WEBVTT

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And then moving more towards kind of
a regulated infrastructure partner. We serve rias

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and the RIA platforms that are bringing
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other institutional counterparties that want to provide
direct access to for their clients to hold

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digital assets. This content is brought
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please visit vchain dot org. Link
will be in a description. Welcome to

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the Thinking Crypto Podcast. Her home
for Cryptocurrency News and Interviews. With me

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today is Nathan McCauley, who's the
co founder and CEO of Anchorage Digital.

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Nathan, great to have you on. Thanks so much for having me.

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Happy to be here, Nathan.
I'm excited to speak with you because I

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followed Anchorage for many years and you
guys are certainly one of the top tier

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custodians out there, and got a
lot of questions about your news services and

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much more. But before we get
there, tell us about yourself, where

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you're from, and what's your professional
background. Sure, thanks for asking.

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So excited to be here. It's
been following your podcast for a while,

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so it's a pleasure to be on. I guess my name is Nathan.

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I grew up in somewhat small town
rural Indiana. Everybody around me their parents

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were farmers or factory workers. That's
kind of the game in rural Indiana.

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The town actually grew up in for
a little while there was actually called Economy,

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Indiana, which I always think of
that as kind of a funny fact

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now that I'm working in crypto,
working in finance, having grown up in

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a little town called Economy Indiana.
But yeah, got my start there,

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and the Internet really unlocked the ability
to connect with people. My town only

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had something like one hundred and fifty
people, so it was nice to get

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to connect with a broader community online, whether that was through online message boards

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or MMOs like various MMO video games
that I played growing up, really got

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to me to connect with more of
the world. And then as I went

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off to college, wanted to start
my career. I really wanted to get

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into tech, and so figured out
that where they were building the tech was

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San Francisco, and so got myself
hired at a number of companies out in

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San Francisco, and from there really
focused in on software security, compliance,

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fintech, all of which came together
very nicely when it came time to start

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Anchorage later on my career with my
co founder, where we looked to build

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an institutional custodian for holding digital assets
for institutional investors. Now, along your

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journey towards crypto, what was your
first encounter with bitcoin and what was your

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AHA moment? Sure, so it's
it's funny. I have to admit that

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I was a little bit late to
the game on bitcoin, not for lack

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of hearing about it early on I
was one of the one of the places

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I worked at when I was in
the tech scene in San Francisco was at

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the time a very small startups called
called Square. We made a little device

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that plugs into mobile phones allowed people
to accept credit card payments. At the

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time, it was mostly for people
buying and selling, say furniture on Craigslist,

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maybe small coffee shops, things like
that. Really saw Square grow monumentally

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while I was there. Wish I
could take all the credit for that.

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I can't. I was just a
member on the team there, but had

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a really fun time, and it
was during that time that bitcoin really rose

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to rose to prominence. So lots
of people there. Of course, we

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were in payments, we were in
fintech. Lots of my colleagues looked at

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bitcoin and thought it was interesting.
I thought it was interesting from the cryptography

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perspective, but because of what I
would say was my US centric view on

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it, I didn't really perceive the
notion that we needed an alternative currency,

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and so I have to admit that
I missed the point of it early on.

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What I did talk to a lot
of folks about at the time was

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men wouldn't be cool if software applications
could run in the blockchains instead of just

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having decentralized money, could we have
decentralized code, decentralized infrastructure. And so

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some amount of brainstoring about that early
on, and so I was very pleased

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when I turned away from crypto for
many years, turned my gaze back on

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it and found that Ethereum had come
out and exactly that idea had come to

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fruition, This idea that you could
do decentralized applications. That ended up being

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where I really started to get more
interested in, see, oh, hey,

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this is not just a currency thing, this is an everything thing.

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All software can go in this direction, all services can go in this direction.

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It can actually solve a lot of
the problems for us. And so

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that's really what piqued my interest even
more later on with crypto was the rise

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of ethereum, the rise of decentralized
applications. Yeah, absolutely, So what

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was the genesis of the idea to
start anchorage? Did you see a need

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in the market because custody absolutely so
important, right, It's a pillar for

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many acid classes to have proper custody. What was the genesis of the idea

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behind it? Yeah? So the
general purpose idea is Diogo and I Diyoga

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is my co founder here at Anchorage. We were working on Docker. Docker

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at the time was it wasn't is
a cloud computing technology, and we were

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working on security for that to really
bring great security to everybody deploying into into

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cloud environments. Was AWS, Azure, GCP, kind of across the board.

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And one of the things we saw
was particularly in twenty seventeen, was

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the rise of bitcoin's bull run in
a sense really one of the first bull

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runs that really kind of catapulted crypto
bitcoin into the public consciousness at large.

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And the market reality that you saw
at that point was that was entirely a

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retail driven phenomenon. And so if
you take a look at any other asset

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class in the institutional space, what
you find is upwards of certainly more than

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fifty percent sometimes sixty, seventy,
even eighty percent of a particular asset is

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held by institutions that hold it,
and it tends to be a relatively smaller

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overall market share that is held by
individual investors. Crypto had the reverse of

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that. They had huge amount of
retail interest, very little institutional interest,

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and so that performed the thesis for
why over time bringing institutions in would be

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super important. On top of that, you start to look at like,

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okay, what does it take for
institutions to come in? And the starting

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point for them is how to hold
the asset. They can't even get started

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in the asset class if there's no
way for them to hold the asset.

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They need software, security, institutional
counterparty, and regulatory certainty all combined into

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a single package that formed the basis
of the thesis early on for Anchorage.

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Add on to that the fact that
Diogo and I had a lot of interest

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from potential people in the ecosystem,
the real early adopters that were starting to

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invest in digital assets reaching out to
Doogo saying hey, can we custody these

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digital assets? How can we do
this? How do we do this better?

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And got a real sense there that
not only was there a kind of

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theoretical possibility like I laid out of
institutions will adopt the need custody, but

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also a market reality at the time
that people needed it and needed it immediately.

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And so that is really kind of
the genesis of the idea, is

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that understanding of the market structure and
frankly just a market demand that people wanted

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the service back then, Sure,
can you tell us a bit about anchorages,

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different services and what makes it unique
from other custodians in the market.

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Sure so. Certainly at the inception
of the company, the prevailing market sentiment

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was this idea of cold storage.
The basic notion of cold storage is take

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assets, put them on a computer, turn the computer off. That's the

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only way to be secure. Basically
viewed that as roughly speaking, what you

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learn in security one oh one in
college. On the first day, you

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learned that's the only way to build
a secure system, and then the entire

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rest of your education is how to
actually build usable secure systems. And so

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the state of the art was put
it on a computer, turn it off.

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So this was like, Okay,
we have a real opportunity to improve

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on the tech that underlies this,
and we different to ourselves to this day

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about how institutions can get very fast
access to funds. This manifests in a

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lot of different ways. So they
can trade and settle immediately, they can

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access staking services, they can access
DeFi, they can work with NFT marketplaces,

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all without having to have this notion
of taking the assets out of cold

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storage, making them usable, and
then actually doing the action. All of

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your assets should be accessible to you
whenever you want them, and in doing

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that, you can actually build systems
that are even more secure than cold storage

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by tying in biometric authentication, tying
in a whole host of authentication metrics that

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you can bring into the ecosystem.
And so from that custody base, which

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we've grown exponentially over the last seven
years, we've been able to add services

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on top of that, and so
trading services were very popular trading part counterparty

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for some of the biggest institutions in
the world. Settlement services allow them to

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move assets around. A huge amount
of the assets that are held in our

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platform are staked, and so we
have the staking capabilities across a whole variety

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of different assets. And the story
doesn't stop there. We're continuing to add

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and scale up and add more services
as clients demand them. That's amazing.

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And if I'm not mistaken, you
guys had gotten a license on the OCC

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a couple of years back, right
or a few years back, which allowed

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I think I can't remember if we
made you a digital bank. Is that

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correct? Yeah, that's right.
That's right. So early on I was

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talking about what it takes for institutions
to come into the digital asset space.

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The way we thought about it when
we started the company was if we combined

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the solution to two impossible problems,
we would have a very valuable offering in

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the market. That first one was
a fundamental advancement on the state of the

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art, which was previously cold storage. What if we do things better so

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that people could access the assets at
any time? Hard security problem needed to

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be solved. We solved it.
The second impossible problem we wanted to solve

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was how do we get the whole
thing regulated? How do we act as

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a what's called qualified custodian for digital
asset investors. When you're investing other people's

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money at significant enough scale, you
have to follow a rule called the custody

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rule that is enforced by the SEC. The SEC says, if you're over

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this amount of assets that you're managing
for other people, you must hold your

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assets in a qualified custodian. Qualified
custodian has to safely hold the assets and

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do that in a regulated way.
There's a number of ways to do that,

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but the most unambiguous and clear way
to do that is to get a

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federal bank charter, and so many
years into our process, we were actually

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granted the first and as of today, only federal bank charter allowing holding of

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digital assets. And so that was
issued by the what's called the OCC,

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Office of the Controller of the Currency. It's a sub sub agency I suppose

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of the US Treasury. And so
we remain the only federally licensed, federally

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overseen national bank that holds digital assets
for our clients. Wow. I know

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there has been and we're going to
talk a bit about it later, just

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a lot of uncertainty in the market, a lot of pushback on maybe a

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certain legislation and things that have been
put forth. If I'm not mistaken,

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I saw that some folks are trying
to push back on the OCC handing out

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some of these approvals or licenses.
Have you encountered any issues with that over

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the years. So we've found the
OCC to be a very fair regulator and

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a very informed regulator. I would
say they do not take their responsibility lightly

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when they oversee a bank. They
hold that bank to the same standards as

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they hold every other bank to.
And so what we have been working on

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for the past several years since we've
gotten the charter, is continuing to advance

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that relationship, continuing to mature our
processes while the federal agency has mature they're

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understanding of the digital asset ecosystem,
and so we have found a very fair

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and thoughtful broker in the OCC and
in how they oversee us. I think

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it makes a lot of sense as
you start to scale up the amount of

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assets in a platform, as you
start to scale the kinds of use cases

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that institutions want to get into.
Having the transparency and the finality that comes

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with blockchains on top of federal oversight
from a regular like the OCC really gives

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you the best in breed level of
trust that a custodium can provide. And

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so you take that transparency that inherently
comes with the blockchain plus the same level

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of oversight as the other large banks
in the country, and there's really no

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place that you can get as much
trust in the custodian as you can get

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from Anchorage Digital Bank. And so
this as a trend. We being the

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first, we expect that we will
be the first of many to get this

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charter and to work in this place. For now, we're for now we're

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the only ones, but we think
it's a very positive trend and expected to

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continue over time for sure. Yeah, I mean we're seeing Congress and the

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folks. They are all working towards
passing legislation. Obviously, there's still a

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lot of uncertainty and confusions when many
government agencies. We're going to talk about

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the SEC later and so forth.
But it is what it is. And

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but to your point, the occ
seems to be they understand the landscape and

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are working with the industry. Tell
us about the type of clients that are

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working with you. I don't know
if you can name drop, but maybe

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you can give us the categories and
are you custodying any of the bigcoin ETFs?

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Hi, everyone part in the interruption. I'm Tony Edward, the founder

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and host of the Thinking Crypto podcast. I have a YOUG favor to ask

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you. If you haven't subscribed as
yet on YouTube or the podcast platforms,

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hit that subscribe button, hit the
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or Apple or wherever you get your podcasts,

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please leave a five style rating and
review. It supports the podcast.

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It allows me to bring great quality
content to you. Thank you for your

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support, and I'll let you get
back to the content. Good question.

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Good question. So we serve some
of the largest institutions globally, the largest

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holders of digital assets. By way
of categories, I'll start with early adopters,

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venture capital funds, hedge funds.
Anyone who was early to the space

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wanted to invest in digital assets,
whether that's taking positions in bitcoin and ethereum

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or a us the landscape, investing
in the new protocols that are coming out

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like ap dose, Suie, stark
net, other other kinds of protocols where

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investors want to participate in those.
So we really like serving the investors in

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the in the ecosystem, but we
also like solver serving the innovators themselves.

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So the blockchain protocols, when they
launch a new protocol, often the their

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entity and their their foundation ends up
holding a decent portion of the overall circulating

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supply, and so we we serve
as a custodian for them as well,

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and that's a big, big area
for us. On the more traditional side,

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we serve entities like sovereign wealth funds, So some of the global sovereign

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wealth funds that want to take positions
in digital assets, we serve their their

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use cases as well, and then
moving more towards kind of regulated infrastructure partner

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UH we serve rias and the ra
A platforms that are bringing folks like Franklin,

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Templeton, eagle Brook other institutional counterparties
that want to provide direct access to

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for their clients to hold digital assets. In terms of the crypto ETFs,

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it's a very exciting area where we
don't have anything to announce today, but

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suffice it to say that we are
a very natural partner for any crypto based

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ETF looking to roll out products in
that area, looking to do things like

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custody of say bitcoin or over time. One of the things that's very interesting

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is that our Federal Bank charter allows
us to participate in staking, and so

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the fact that it allows usicipate in
staking, we think will be a very

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meaningful unlock for future growth for the
the ETFs that might want to have assets

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in the ETF that incorporate a staking
component there as well, and so we

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expect the the ETF landscape to be
a big part of our growth over time.

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Let's talk about staking for a second. I'm very fascinated by that because

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on multiple levels, I persons stay
crypto. There's a lot of retail investors

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whose steak as well. Are you
seeing a growing demand in institutional staking and

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are they viewing it as a passive
income or some sort of yield that they're

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earning over time, and are they
adding to that pool. Let's say it's

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e theorem right that they see that, hey, we can hold this asset,

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it's going to appreciate in price over
time, but what we can also

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earn yield off of it via staking. It's a really good question. I

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think I can't necessarily speak to everybody's
particular interest in staking and why they're pret

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in stake. And there's certainly folks
that want to participate in staking for exactly

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what you're talking about, because there's
a yield component that comes along with the

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staking. There's others that view it
as, hey, there's this blockchain has

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an emission schedule, and if I
want to keep up with my ownership percentage

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of the total supply, I need
to participate in staking in order to make

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sure that I am not diluted of
my total share. And so the individual

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views on which way to think about
that vary, and I think everybody has

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their own different investment thesis and reason
for participating. What I can say unequivocally

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is that staking is a growing business
for us. We've seen over quarter growth

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in terms of number of units and
overall dollar equivalent value that is participating in

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staking in our platform. Right now, I think something like one sixth of

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our asset base participates in staking,
and so we have a very sizeable amount

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of assets in the platform that are
being staked. A lot of this is

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ethereum, a lot of this is
other assets like Solana, but then a

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bunch of the new assets that have
launched over the last several years, they

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tend to launch and want to participate
in staking from day one, and so

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there's a there's a really healthy mix
of different assets in the platform that are

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participant in staking. M HM,
tough question for you, and I'm not

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sure if you can speak fully to
this, because I know it's there's many

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complications today. If an asset a
crypto asset, and this is a big

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debate happening with the SEC, c
FDC and much more. We're waiting,

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we're waiting for clarity from Congress.
But if an asset that says classified security?

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Does that affect your ability to custy
it? So there's a lot of

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market participants that need to devote a
lot of careful consideration to whether an asset

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is a security. The good news
for us, at least is that national

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bank do not. National banks are
unequivocally allowed to custody securities, and so

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when we are custodying assets, we
do not have to decide, hey,

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is this a commodity? Is this
security? Is this a token? National

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banks are given the ability to custody
across the board, and so we utilize

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that fact to custody a wide range
of assets without necessarily on the custody side

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needing to be concerned whether it's a
security, commodity, or any other such

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type of asset. Got it all
right, Let's talk about the big news.

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Porto, the institutional self custody wallet. Tell us about this and what

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are the capabilities? Sure so,
Porto is a great addition to our product

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suite. What we've seen over the
lifetime of Anchorage is that our clients want

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to do more and more with us
with our tech, with our platform.

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As I mentioned earlier, we built
our tech in a way that allows it

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to be very flexible in order to
move assets quickly to participate with those assets

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UH. And increasingly what clients want
to do is they want to take their

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assets and utilize them on chain for
various activities that they would like to do.

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So those on chain activities might be
participating with various DeFi interactions they might

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want to participate in with a staking
protocol. For example, one of the

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one of the use cases that some
of our clients have wanted to do is

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to participate in restaking type opportunities like
our developing. Sometimes clients want to participate

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into NFT marketplaces UH and put bids
out there for some of those kinds of

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things. And so what you find
is a whole host of use cases that

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are really frontier use cases that clients
would like to participate in. And the

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best way to do that tends to
be to take the assets yourself, put

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them into your self custody system,
and then within that self custody system,

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utilize the platform capabilities that allow you
to participate there. And so really what

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it is doing is allowing the clients
to with a familiar set of tech interfaces

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that are very much distinct from our
custody system for example, and for the

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kind of the regulated entity systems but
still feel familiar in a way, allow

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them to access the full range of
things that they would like to do with

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their assets. And so that's really
the raison deetra for Porto was serve the

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client's use cases, allow them to
have the flexibility to use their assets in

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the way that they would like to, and really free them up to access

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the whole ecosystem of activities and opportunities
that are available within the crypto ecosystem.

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Now, as a retail investor,
I use hardware wallets and I have some

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software wallets that I use as well, so and I have to back up

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my private keys and make sure those
private keys are safe and secure. Tell

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us about the process of the private
keys for those institutions. Are you helping

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to cussy the private keys or is
it split? What's the metrics or the

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mechanisms behind that? Good question,
good question. So what institutions want,

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and whether it's in a custody system
like anchor digital bank or a self custody

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system that puts more of that control
in their hands. Ultimately, what they

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want is reliability. They want to
know that they have the assets, want

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to know that the assets aren't going
to somehow disappear, they are going to

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make some sort of a mistake and
lose access to their assets. And so

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the core premise of Porto at its
inception is provide the same level of security

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and the same level of trust as
is possible when using Anchorage Digital Bank for

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these clients. And so what we
provide is a very similar security architecture,

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security mechanisms, things like access to
the keys using biometric authentication with hardware devices

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that you have on the client side
and then backed by keys that are backed

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up by Anchorage and allow people to
make sure that they have access to those

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things. Now, notably, we
do not have any access to their assets.

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We are not able to move their
assets. That is only possible through

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their infrastructure, and they must be
involved in order to be able to do

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that. But the set of trade
offs and constraints that we allow them there

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allow them to have say key recovery, where they can migrate the keys if

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they want, they can recover the
keys. They recover the keys without needing

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to interact with us, And so
that you have a whole set of frameworks

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and options that are available there while
maintaining the same level of trust and reliability

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that the clients have come to expect. Mm hmm. I want to talk

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about like the industry and custody because
obviously we saw what happened with FTX and

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com mingling and all kinds of nonsense, right, and then we're seeing certain

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bills being brought up by different sites, like I saw California put out something

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for proof of reserves and so forth. Do you see a rise in custodies

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custodial services around crypto being used by
uh more government and so forth, who

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are going to eventually put bitcoin in
their treasury and so forth, pension funds

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and endowments and so forth. I
would love to get your take on how

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the custody landscape essentially has changed since, like because of the big FTX collapse.

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Sure, yeah, so I think
one of the ways, one of

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the ways to think about this is
that crypto in many ways has gone through

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cycles, and one kind of interesting
way to think about it is that it

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has gone through cycles on a accelerated
path relative to say the broader markets.

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And so you could look at some
of the exuberance that happened in twenty seventeen

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as roughly equivalent to the stock market
boom and bust cycle of the early two

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thousands. And I like to liken
everything that happened with FTX to the set

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of issues that happened in the traditional
financial markets around two thousand and eight,

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some amount of fraud, some amount
of over leverage, and that causing some

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failure to some institutions and a really
hard lesson for many people to to to

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live with. And so what you've
seen with FTX is a I think healthy

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response to think more about counterparty risk, to think more about segregation of duties,

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to think more about regulatory oversight,
combining with cryptotransparency, all of those

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things coming together leading to a renewed
interest in conservative, thoughtful players like Anchorage.

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And so in many ways, the
industry suffered a big, big blow

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overall when it came to the FTX
issues that happened there. But in the

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in the rebuild there that has been
beneficial, I would say, in many

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ways to the players that are trying
to do it right, like Anchorage,

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the players that are trying to say, hey, we want to never commingle

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client's assets, always keep them on
separate ledgers in separate blockchains, so that

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when you're holding assets and anchorage,
not only do you get a statement from

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US that says, hey, you
have twenty bitcoin, but you have a

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wallet address where you can look at
your wallet address and say, hey,

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that's my wallet address. I know
that my particular bitcoin is held there by

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particular theory of my particular xy z
token. And so that additional level of

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transparency that we'll provide where you have
segregated wallets on chain, all also being

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overseen by a federal regulator. There's
no way to get more transparency and clarity

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than this. And what we're going
to see over time is more of the

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world's institutions will move to this model
where the counterparty risk is so greatly reduced

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because of that federal oversight, because
of that on chain transparency. And I

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do think that, yes, over
time, we already serve sovereign wealth funds

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who have decided that they want to
allocate into crypto, and whether that's whether

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that's their their treasuries or as you
mentioned, pension funds coming in over time,

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I think there will be a whole
host of this, and some of

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that will come from direct relationships with
us, like many do today. Some

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of it may come in through the
ETFs or which we will be a custodian

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of H and it will be a
good variety of ways to access the crypto

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rails. I'm assuming the answer is
no, it is, but can can

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you tell us someone the names of
those sovereign wealth funds? I cannot kudos

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for asking, but we have to. We have to be thoughtful about our

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clients and their positions. I gotta
yeah, you know, and it's it's

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out of general curiosity because everybody wants
to know, you know, who's who's

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investing and so forth, especially from
the soalegn wealth fund standpoint, because you

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don't get too many headlines and things
along those lines. You know about those

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folks. So anyway that I ask
fair enough, what's on your twenty twenty

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four roadmap? So this year we
want to really build on top of the

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strong custody base that we've gotten,
and the general trend is to do more

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things that our clients want us to
do. So clients are asking for more

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advanced trading capabilities. We're going to
help them with that. Clients have asked

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for easier access to FIAT rails and
all things around. Stable coins, so

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we're going to do more of that. Clients have asked to be able to

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hold assets at anchorage and not have
to move those assets to exchanges in order

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to trade, and so being able
to do off exchange settlement where you hold

383
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your assets and anchorage, but then
still get the ability and buying power,

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whether it's ATTC desks, market makers, or crypto exchanges. Clients want,

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clients want access to that. We
want to continue to help out the ra

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A ecosystem. It seems like there's
been a acceleration in that area, driven

387
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in many playouts by the crypto ETFs. Right now you just have bitcoin ets,

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but many of the r providers want
to provide access to more tokens for

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the clients, and so we're going
to be integrating with them and even more

390
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some some things that I can't necessarily
announce yet, but that's it's going to

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be a really big year for us. And so we're looking forward to that

392
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follow up question on the item where
clients want to not be have to move

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their funds out of custody, you
know, whether it be OTC or trading

394
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and so forth. Are you playing
to build like your own trading desk or

395
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a partner with an exclusive exchange or
I don't know if you can share any

396
00:33:53.519 --> 00:33:59.759
details or it's under NDA for now. No. So we do have a

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trade capability that is built into anchorage
at this point, and clients that are

398
00:34:04.160 --> 00:34:08.480
holding assets with us are able to
trade. We go find the best price

399
00:34:08.519 --> 00:34:13.320
for them out in the ecosystem and
then allow them to execute that trade and

400
00:34:13.360 --> 00:34:17.039
then settle directly into and out of
custody. That doesn't meant all of the

401
00:34:17.239 --> 00:34:22.159
client's needs, and so sometimes there
are particular features of other OTC desks or

402
00:34:22.199 --> 00:34:29.360
exchanges that they'd like access to without
having to take counterparty risk to actually put

403
00:34:29.400 --> 00:34:35.639
their assets on, say that custodial
exchange or that that dealer, and so

404
00:34:35.719 --> 00:34:40.000
what's what's needed there is really a
kind of a triparty solution to allow people

405
00:34:40.039 --> 00:34:45.400
to keep assets at anchorage and have
the counterparty know that there are assets there

406
00:34:45.400 --> 00:34:47.519
that are available to them in order
for them to trade. That's what we'll

407
00:34:47.559 --> 00:34:52.079
be We'll be looking to expand in
that area over time. That's awesome.

408
00:34:52.679 --> 00:34:55.480
Let's talk about the crypto market at
large. I would love to get your

409
00:34:55.480 --> 00:35:00.599
thoughts on the bitcoin ETF launches and
the inflows we've been seeing pretty incredible and

410
00:35:00.960 --> 00:35:04.760
it just seems like there was pent
up demand for bitcoin. What are your

411
00:35:04.760 --> 00:35:10.119
thoughts on the performance. I think
it's it's really just the beginning there.

412
00:35:12.400 --> 00:35:20.199
This is a asset that has continually
attracted more and more people over time.

413
00:35:20.519 --> 00:35:24.239
The general trend is as you learn
more about bitcoin, you get more interested

414
00:35:24.280 --> 00:35:28.920
in it and want to participate in
it, not just because of the price

415
00:35:28.960 --> 00:35:32.480
appreciation, but because of the deflationary
nature of it, the fact that there

416
00:35:32.559 --> 00:35:37.079
is a fixed supply, and so
I think what has happened there is a

417
00:35:37.800 --> 00:35:44.400
packaging in the in the bitcoin ETFs
that has allowed more people to more easily

418
00:35:44.400 --> 00:35:51.239
express that opinion, whether that's through
their existing brokerage accounts, existing institutional offerings,

419
00:35:52.000 --> 00:35:55.239
and so that that is a area
that will continue to grow and will

420
00:35:55.360 --> 00:36:01.840
basically only continue to grow over the
next really decades. I think the cascade

421
00:36:01.840 --> 00:36:07.679
there is that the bitcoin ETF is
just the first of many, and that

422
00:36:07.679 --> 00:36:10.360
we should expect that to be an
infinite game, not dissimilar to the way

423
00:36:10.519 --> 00:36:16.960
that traditional asset ETFs are. There's
an infinite number of combinations that come together

424
00:36:17.360 --> 00:36:21.599
in those markets, and so we
should we should expect this to be a

425
00:36:21.719 --> 00:36:24.719
very healthy ecosystem that develops over time, and we're just in, you know,

426
00:36:24.840 --> 00:36:30.480
really the first inning of what that
looks like. For sure. I

427
00:36:30.480 --> 00:36:34.280
know everybody's asking about the etherar METF
when we might see that this year and

428
00:36:34.360 --> 00:36:38.360
next year? And obviously we got
still some uncertainty from the SEC and the

429
00:36:38.360 --> 00:36:42.480
CFTC and so forth. Do you
think we see that this year or maybe

430
00:36:42.480 --> 00:36:46.320
next year? So it's a good
question. If I had a if I

431
00:36:46.320 --> 00:36:50.920
had a crystal ball that knew the
answers to these things, I would be

432
00:36:51.039 --> 00:36:54.719
running a hedge fund instead of a
custodian. And so the core premise of

433
00:36:54.800 --> 00:36:59.119
running a custodian is, uh,
you don't know. You can't predict the

434
00:36:59.119 --> 00:37:05.039
price, you can't predict anything except
that the general trend is positive for digital

435
00:37:05.079 --> 00:37:08.559
assets and everyone's going to need a
custodian there. And so I'll avoid making

436
00:37:08.559 --> 00:37:14.400
any kind of prediction. But but
to say that I'm I'm a supporter of

437
00:37:14.440 --> 00:37:21.480
the idea. I think the faster
that we can get more of the investing

438
00:37:21.480 --> 00:37:27.320
public access to these assets, the
more fair of a of a situation we're

439
00:37:27.360 --> 00:37:31.559
going to have in the in the
digital assets ecosystem. The digital assets shouldn't

440
00:37:31.559 --> 00:37:37.480
only be available to early adopters or
those who can figure out all the complexities

441
00:37:37.480 --> 00:37:45.360
of private key hes and crypto specific
exchange accounts. So the the crypto ETFs

442
00:37:45.440 --> 00:37:50.480
as a rapper that gives the financial
outcome to more and more of the investing

443
00:37:50.480 --> 00:37:58.719
population is a undeniable public good and
I'm very very excited to see more people

444
00:37:58.760 --> 00:38:02.360
get access to the opportunity here for
sure. Let's talk about n f t

445
00:38:02.480 --> 00:38:08.159
s and tokenization and is anchorage custding
n f t s for any major brands

446
00:38:08.239 --> 00:38:14.400
or institutions and I'm assuming you're set
up to handle tokenization of real world assets

447
00:38:14.400 --> 00:38:19.840
as well. Yeah, good questions. So we are an NFT custodian for

448
00:38:19.920 --> 00:38:27.519
a number of the larger brands in
the space that are working in the in

449
00:38:27.599 --> 00:38:32.519
the the n FT ecosystem, So
we don't have any disclosable relationships there,

450
00:38:32.519 --> 00:38:37.639
but we do we do hold n
f ts for clients and and help them

451
00:38:37.679 --> 00:38:42.920
with that, whether it's people that
are using us as an infrastructure provider for

452
00:38:43.280 --> 00:38:46.679
say they're buy and sell all the
way to say n f T funds that

453
00:38:46.760 --> 00:38:54.199
want to hold assets with us and
participate in the the price appreciation of those

454
00:38:54.800 --> 00:39:01.480
of those n FT collections. On
the real world asset side, this is

455
00:39:01.519 --> 00:39:07.000
a this is a very interesting area. I have a little bit of a

456
00:39:07.480 --> 00:39:10.880
i guess contrarian view on this,
or maybe non standard view that there is

457
00:39:10.920 --> 00:39:19.519
actually a very very popular real world
asset that most of the crypto industry participates

458
00:39:19.519 --> 00:39:24.960
in, which is USDC USDC stable
coins generally, I think are the first

459
00:39:25.199 --> 00:39:31.519
proof point of real world asset tokenization, and so where we do a lot

460
00:39:31.559 --> 00:39:35.679
with stable coins, and we're can
continue to do a lot with stable coins,

461
00:39:36.679 --> 00:39:39.760
but it's an area that I think
can grow over time. You have

462
00:39:40.000 --> 00:39:46.039
a lot of positivity around the space, particularly around asset tokenization. Some of

463
00:39:46.039 --> 00:39:53.960
the recent announcements, say from black
Rock looking at tokenizing effectively treasuries in a

464
00:39:54.000 --> 00:39:59.519
sense, and we are a we
are a partner to them on that,

465
00:39:59.760 --> 00:40:02.599
and we are we are customing some
of the Biddle token h for some of

466
00:40:02.639 --> 00:40:06.840
our clients who have looked to take
a position higher. And so we're going

467
00:40:06.880 --> 00:40:12.719
to continue to grow in that area
and excited to be a an enabling infrastructure

468
00:40:12.719 --> 00:40:19.599
player for the real world assets tokenization
movement. Yeah, and I'm very curious

469
00:40:19.639 --> 00:40:22.559
about the future of that and more
so because maybe my background, but real

470
00:40:22.639 --> 00:40:28.480
estate, like if a building in
Manhattan is getting tokenized, and I can

471
00:40:28.519 --> 00:40:35.239
buy a chunk of those respective tokens
and then have them at a custodian like

472
00:40:35.320 --> 00:40:39.760
anchorage and then trade them or borrow
against them or whatever it may be.

473
00:40:40.440 --> 00:40:44.280
I'm curious about that, you know. And and it may be artwork as

474
00:40:44.280 --> 00:40:50.559
well, having certain rare art pieces
of art token ied. So I know

475
00:40:50.639 --> 00:40:52.880
black Rock is looking to do funds
and all that not really I like for

476
00:40:53.000 --> 00:40:57.440
me personally, or you know,
a different flavor for everybody, But I'm

477
00:40:57.519 --> 00:41:01.199
very curious about the real estate tokenization
and what that would look like. Yeah,

478
00:41:01.199 --> 00:41:08.800
I think it's a it's a really
interesting thing to somewhat reflect on the

479
00:41:09.000 --> 00:41:13.920
things that we can own as investors
right now. So none of us,

480
00:41:14.360 --> 00:41:19.199
none of us blinks an eye when
we're able to own a small fraction of

481
00:41:19.239 --> 00:41:23.840
a publicly traded company. You know, you and I are very easily able

482
00:41:23.840 --> 00:41:30.599
to own a portion of Tesla and
participate in the rise or fall of Tesla,

483
00:41:30.199 --> 00:41:37.320
And for reasons that aren't entirely clear, that's less possible with real estate

484
00:41:37.360 --> 00:41:42.679
assets. And so the the idea
that real estate assets could be fractionalized and

485
00:41:43.400 --> 00:41:49.760
have more widespread participation in that area. You know, real estate is one

486
00:41:49.800 --> 00:41:54.159
of the one of the biggest assets
in the in the country. There was

487
00:41:54.199 --> 00:41:58.480
even early in the early in the
country's history, there was even an idea

488
00:41:59.639 --> 00:42:07.880
that the dollar should be backed by
real estate. And it was the first

489
00:42:07.519 --> 00:42:13.760
real world asset, real estate to
real world asset. And so I think

490
00:42:13.760 --> 00:42:17.519
it's I think it's a great trend. I hope crypto is enabling mechanism for

491
00:42:17.679 --> 00:42:22.960
more widespread ownership of real estate,
and so yeah, I would love to

492
00:42:23.039 --> 00:42:28.400
join you in that in that endeavor
once it's once it's more readily possible.

493
00:42:30.960 --> 00:42:34.239
I know you probably can't answer too
much about this, but I'll ask you

494
00:42:34.280 --> 00:42:39.880
anyway. Is there anything in addition
to the black Rock what they're trying to

495
00:42:39.880 --> 00:42:44.840
do, investing funds and so forth, any other information you can share there

496
00:42:44.840 --> 00:42:50.280
and they're looking to tokenize other things, and you know, whatever you can

497
00:42:50.280 --> 00:42:54.679
get details you can give there.
Sure, great questions. So I don't

498
00:42:54.719 --> 00:43:00.480
have any particular insight there versus what
you can. You can see Black Rocks

499
00:43:00.480 --> 00:43:07.800
saying publicly, even even Layer of
Fink saying publicly that they have a big

500
00:43:07.840 --> 00:43:13.679
strategy on their side to participate in
this area, and so it's it looks

501
00:43:13.679 --> 00:43:16.679
like it should be an interesting area
pay attention to over time. But I

502
00:43:16.719 --> 00:43:22.039
don't have any particular insight that I
can share there. I hope you I

503
00:43:22.039 --> 00:43:25.360
got to ask because the users and
the people listen and watching, like ask

504
00:43:25.400 --> 00:43:30.280
him about this black rod. Everybody
wants to know what's happening the seeds.

505
00:43:30.559 --> 00:43:34.480
All right, I got some wrap
up questions here for you. Firstus,

506
00:43:34.559 --> 00:43:37.199
if you could create your own metaverse, what would the theme be? Yeah,

507
00:43:37.239 --> 00:43:43.159
so this is a This is an
interesting question. I I like meta

508
00:43:43.280 --> 00:43:50.840
verses mainly in the sense that they
can spark the imagination about what we can

509
00:43:50.880 --> 00:43:54.840
do in the real world. So
most interested in how they can participate in

510
00:43:54.880 --> 00:44:00.800
the real world. And so my
my view of this would be combine a

511
00:44:01.000 --> 00:44:08.360
metropolitan city like a San Francisco or
New York with the architecture and taste of

512
00:44:08.440 --> 00:44:17.760
Barcelona in the commitment to beauty that
Barcelona brings, with a healthy dose of

513
00:44:19.880 --> 00:44:24.440
rural areas. And so if I
can be out in a on a row

514
00:44:24.480 --> 00:44:30.440
boat on a pond and then head
into a beautifully designed city, that would

515
00:44:30.480 --> 00:44:35.559
be my ideal metaverse. Mainly,
so that it could spark the imagination so

516
00:44:35.599 --> 00:44:39.000
that we can see those things come
into reality someday. That's awesome, and

517
00:44:39.039 --> 00:44:44.119
it got some wrap up questions here, excuse me, rapid fire questions Versus

518
00:44:44.159 --> 00:44:50.159
favorite food. Favorite food, I
would have to say I love grilling,

519
00:44:50.440 --> 00:44:55.000
and so a steak grilled to perfection
along with a potato some corn on the

520
00:44:55.000 --> 00:45:00.840
cob. That really that's my sweet
spot. Favorite music or ben uh.

521
00:45:01.280 --> 00:45:06.679
Lately been listening to a lot of
Boston. I think they did a They've

522
00:45:06.679 --> 00:45:08.719
always done a really good job.
You know, it released one album a

523
00:45:08.760 --> 00:45:12.000
decade, you know, really took
their time on and did it right.

524
00:45:12.039 --> 00:45:16.320
So I'm a big fan of Boston. And favorite movie. Uh, favorite

525
00:45:16.360 --> 00:45:24.880
movie. I loved Mad Max Fury
Road for just its its commitment to a

526
00:45:24.920 --> 00:45:29.079
theme, the beauty that was in
there. It wasn't it wasn't trying to

527
00:45:29.119 --> 00:45:30.360
have a big plot. It was
just trying to do exactly what it did.

528
00:45:30.400 --> 00:45:34.199
It did it so well and so
big fan of Mad Max. Yeah,

529
00:45:34.239 --> 00:45:37.639
me too. I love the Originals
as well with Mellen Gims. Those

530
00:45:37.639 --> 00:45:45.159
were great as well. Favorite book. Favorite book lately, I've been focused

531
00:45:45.239 --> 00:45:51.239
on this particular book called Timeless Way
of Building and it's a it's a it's

532
00:45:51.280 --> 00:45:58.480
a book all about how to basically
the ideas that like architecture should be designed

533
00:45:58.960 --> 00:46:07.760
to encourage particular activities and so that
a place gets defined by what happens there

534
00:46:08.119 --> 00:46:13.920
more than the building itself, and
so designing buildings so that they really focus

535
00:46:13.960 --> 00:46:19.119
on what happens there and the implications
of that even beyond architecture are really interesting

536
00:46:19.119 --> 00:46:22.400
to me these days. And when
you're not working at Anchorage, what are

537
00:46:22.400 --> 00:46:27.719
you doing for fun? So gardening, playing with my children. I've got

538
00:46:27.719 --> 00:46:32.559
I've got three kids, reading books, playing chess, a few hobbies there,

539
00:46:32.800 --> 00:46:36.920
but a lot of the time goes
to spending time raising my kids.

540
00:46:37.079 --> 00:46:40.800
Awesome, Nathan, great chatting with
you. I'm looking forward to the future

541
00:46:40.880 --> 00:46:45.000
updates around Anchorage and would love to
have you back on as things progress.

542
00:46:45.239 --> 00:46:47.599
Thank you so much for joining me. Thanks so much, Tony, appreciate

543
00:46:47.599 --> 00:47:02.960
it. Task eighty th stut T
postopt thing Stan