Speaker 1: Hi everyone.
Speaker 2: I'm Tony Edward, I'm Amanda were Croft, and we are
Speaker 2: recording at the Salona Policy Summit. And joining us is
Speaker 2: Anthony Scaramucci, who's the founder and managing partner at Skybridge.
Speaker 2: Great to see Anthony.
Speaker 1: Good to be here. Thank you guys for having me.
Speaker 2: So, Anthony, what's happening with this bear market? What do
Speaker 2: you think we might see a recovery?
Speaker 1: So I'm old school, I've been in the category that
Speaker 1: this is a cyclical bear market, traditional to the four
Speaker 1: year cycle of bitcoin, and you've just crossed the halfway
Speaker 1: mark of the having and so you're on your way
Speaker 1: to the back half of this thing. You typically don't
Speaker 1: get any type of real recovery until the first quarter
Speaker 1: of next year. And because we had this slightly accelerated,
Speaker 1: and I think this was macro related to President Trump
Speaker 1: and some of his tweeting and the tariffs, and then
Speaker 1: obviously now there's a war. You know, although I would
Speaker 1: say bitcoin has been fairly sticky during the war, you know,
Speaker 1: over the last five or six weeks of the war,
Speaker 1: you probably won't see a recovery in bitcoin until maybe
Speaker 1: the first month of the last quarter. Right, So we're
Speaker 1: talking October possibly November of this year, and so you know,
Speaker 1: people will be very down on bitcoin, they'll be very
Speaker 1: down on the all market, be very down on Solana,
Speaker 1: and of course they'll be wrong because it's really just
Speaker 1: more of a cyclical thing. But I think what people
Speaker 1: are upset is that they thought, wow, we've got a
Speaker 1: new administration as positive on crypto. We're basically in like
Speaker 1: a jail house with Joe Biden and Elizabeth Warren. You know,
Speaker 1: we were talking before the show started. I mean, these
Speaker 1: people were brutal, and so you were thinking that you
Speaker 1: were going to get better regulation, You're going to get
Speaker 1: better legislation, and you were going to get a ton
Speaker 1: of buying as a result of the ETF activity. Slani
Speaker 1: ETF a theory METF bitcoin ETF quite celebrated and you
Speaker 1: didn't necessarily get that, but you did not get it.
Speaker 1: Meaning you're still seeing a lot of bitcoin buying, a
Speaker 1: lot of boomers are buying bitcoin, but it's just not enough,
Speaker 1: you know, because you got whales that are selling into
Speaker 1: the You know, the ogs in this industry believe in
Speaker 1: the four year cycle, and so what they do is
Speaker 1: they fulfill the prophecy of the four year cycle. By
Speaker 1: acting on the four year cycle and selling, you know,
Speaker 1: the whales were pumping lots of coins into the supply
Speaker 1: at around one hundred thousand, and that's why we dropped
Speaker 1: into the high sixties.
Speaker 3: I know you had mentioned recently on a CNBC interview
Speaker 3: about two months ago or so that the boomers are
Speaker 3: hesitant to invest in bitcoin because they're more they're they're
Speaker 3: the older generations are more trusting in assets like gold
Speaker 3: and silver. Do you think legislation like Clarity will help
Speaker 3: bitcoin become a less volatile asset?
Speaker 1: I do. I mean I applaud more organ Stanley for
Speaker 1: making the decision to launch it's bitcoin ETF. They priced
Speaker 1: it like fourteen basis points, which was a very competitive price,
Speaker 1: and they've got a huge wealth management division, and so
Speaker 1: if they even just move a half a percent or
Speaker 1: one percent into bitcoin, it'll be very very good for
Speaker 1: the market. And it's another sustainability issue. I think what's
Speaker 1: completely off the table is the notion that bitcoin is
Speaker 1: valueless and all that other stuff. The just the network
Speaker 1: alone makes bitcoin very valuable. But if you don't get
Speaker 1: the Clarity Act legislation passed, you're not going to get
Speaker 1: the banks to really open up Sure Bank in New
Speaker 1: York as an experimental program. I think so far now
Speaker 1: has an experimental program, and there's probably others where you
Speaker 1: can store or I'll hold your bitcoin and custody in
Speaker 1: those places. But until the big money center banks. You know,
Speaker 1: when my private banker calls me and says, yeah, move
Speaker 1: all your bitcoin. You can move it here to our
Speaker 1: bank and we'll give you yield on it, or you
Speaker 1: can be and you can really borrow on it as
Speaker 1: opposed to the twenty five percent LTV as some of
Speaker 1: the big money center banks, you're not gonna see the
Speaker 1: real full throat of adoption. So you know, I think
Speaker 1: I think the estimate was in November of twenty twenty four,
Speaker 1: and I would have gotten this wrong, of course, because
Speaker 1: if you had asked me this question, would the stable
Speaker 1: Coin Genius Act the Clarity Act both be passed by
Speaker 1: the end of twenty twenty five, I would have said yes.
Speaker 1: But here we are about to start. You know, we're
Speaker 1: in middle of April, heading into May. We don't have
Speaker 1: Clarity passed.
Speaker 2: So Anthony, the banks, while they are adopting this technology,
Speaker 2: they're pushing back on the stable coin yield, which is
Speaker 2: holding up the Clarity Act. How do you think that
Speaker 2: gets resolved?
Speaker 1: Well, I mean, of course they are right. I mean so,
Speaker 1: I mean, you know, this is a bigger meta question
Speaker 1: for the United States, which is, if you pay the lobbyists,
Speaker 1: the regulation will come p a simulant to what you're
Speaker 1: paying the lobbyist. This is the whole Citizens United thing.
Speaker 1: You know, we've we've gone up eight x in the
Speaker 1: last fifteen years in terms of campaign donations and donations
Speaker 1: related to policy, and so you know, the banks have
Speaker 1: a huge stronghold in the marketplace. The big irony is
Speaker 1: talking about Elizabeth Warrens. She supposedly hated the big banks,
Speaker 1: but now she's basically one of the big advocates for
Speaker 1: the big banks. I mean she basically takes their memos
Speaker 1: and puts them into her writings and her proposed legislation.
Speaker 1: So I'm of a you know, I respect Brian Armstrong
Speaker 1: at coinbase, and I understand the position he's taking, and
Speaker 1: I mean it may lead to us not getting it
Speaker 1: done this term, and if the Congress switches, it'll probably
Speaker 1: be two or three years before you get something done.
Speaker 1: I'm a little bit more proud to I probably would
Speaker 1: have tried to get something done, and I would not
Speaker 1: make the perfect deal the enemy of progress. And so
Speaker 1: just quickly, the best example I give you that is
Speaker 1: that Bitcoin ETF. Gary Gensler hates us. He did not
Speaker 1: want that to happen. He lost the lawsuits, so he
Speaker 1: was forced to have it happen. But the way it
Speaker 1: came about was ridiculous. It was just like punishing. You
Speaker 1: had to put cash into the ETF, and then if
Speaker 1: you wanted to get liquid, you know, get your money
Speaker 1: out of it, you had to take cash out of it. It
Speaker 1: was ridiculous. Paul Atkins had to rewrite the rules allow
Speaker 1: bitcoin to go in and bitcoin to come out. He
Speaker 1: did the same thing on a theory and with the
Speaker 1: staking couldn't stake it. It was ridiculous, you know. So
Speaker 1: but we got it done, and so that was progress
Speaker 1: on the way to perfection. I think if you put
Speaker 1: the perfection before the progress, particularly in a place like Washington,
Speaker 1: it gets gummed up and it may not happen. So,
Speaker 1: you know, I would prefer the progress over the perfection.
Speaker 1: But that's me.
Speaker 3: Has Crypto aligned with one party Nicole.
Speaker 1: Wall Street or you know, and Brian's sort of like
Speaker 1: a mystical religious figure in our industry compared to me. Right,
Speaker 1: but go ahead, keep going.
Speaker 3: Has Crypto aligned with one party too heavily to pass
Speaker 3: by a partisan legislation, Yeah, you.
Speaker 1: Know, on the margin. Yes, But I think that was
Speaker 1: out of necessity because they really didn't have a choice.
Speaker 1: I mean, the Democrats decided that they were I mean
Speaker 1: choke point two point zero. I mean I was in
Speaker 1: the meetings. You could ask Novograts or Mark Cuban, you know,
Speaker 1: I was in the meetings with the White House people
Speaker 1: in July of twenty twenty four, and then we set
Speaker 1: up another meeting in Treasury and these guys were like
Speaker 1: very antagonistic. So you know, if one party is going
Speaker 1: to be that antagonistic to you, you're gonna be probably
Speaker 1: one sided on the other side. Now, I would like
Speaker 1: to see, and I think David Sachs has said this
Speaker 1: more eloquently than me. I would like to see this
Speaker 1: be postpartisan. You know, you know, whether or not we
Speaker 1: have gold in our reserve, like our strategic reserves is postpartisan.
Speaker 1: The answer is we have gold. So to all the
Speaker 1: other countries, do we have oil as a strategic reserve?
Speaker 1: The answer is yes. It's not a partisan debate. You
Speaker 1: don't have Elizabeth Warren like saying can't have oil, it's bad,
Speaker 1: and you know it's a horrific asset, and we don't
Speaker 1: have that, so we have to we have to get
Speaker 1: off of that. But I understand why I got that
Speaker 1: gott in that position.
Speaker 3: Sorry, coming off of strategic reserve. Do you think that
Speaker 3: the government should hold bitcoin and strategic reserves?
Speaker 1: Yes, but I think it's very hard to hold bitcoin
Speaker 1: in a strategic reserve if it's a partisan issue. And
Speaker 1: I think if we can get this to be a transformative,
Speaker 1: postpartisan what's right or wrong for the country, what's right
Speaker 1: or wrong for the American tax payer, then the answer
Speaker 1: is yes. But if you're in a position now where
Speaker 1: lots of people in the Congress don't understand it, lots
Speaker 1: of people really understand the future of money and where
Speaker 1: it's going and what bitcoin represents in terms of the
Speaker 1: operating layer of decentralized forward money, it's not going to happen.
Speaker 1: So I wouldn't push it. I'd be more or less
Speaker 1: where they were on the Executive Order last year, where
Speaker 1: they said we're gonna we win some in a lawsuit,
Speaker 1: We're going to keep it. We're not going to sell it.
Speaker 1: What's ever on the balance sheet of the government right now,
Speaker 1: we're not going to sell I mean, the Biden administration
Speaker 1: was selling it right up to the end. I'm not
Speaker 1: sure if we've done an audit yet, so don't quote
Speaker 1: me on this, but I sort of think we haven't
Speaker 1: done an audit yet of how much Bitcoin the US
Speaker 1: government actually holds. But my attitude is my mission would be,
Speaker 1: let me rephrase that. My mission would be to explain
Speaker 1: it to people so that they get it the way
Speaker 1: the three of us get it, and then it doesn't
Speaker 1: have to be debated anymore. It just becomes one of
Speaker 1: the things. You know, we have twenty eight different assets
Speaker 1: in our strategic reserve. From a government balance sheet perspective,
Speaker 1: It's not just goal and oil. There's rare earth minerals
Speaker 1: in there. There's other commodities that we think are valuable
Speaker 1: to the manufacturing process. There's medical equipment, medical supplies in there.
Speaker 1: In the god forbid, we go through another pandemic, and
Speaker 1: so those things. No one's sitting around saying, oh, geez,
Speaker 1: you know, let's debate the partisan benefit or detriment to
Speaker 1: having that stuff we got to get bitcoin there, but yeah,
Speaker 1: it it should should certainly be in the reserve.
Speaker 2: How far away do you think we are at from
Speaker 2: the consensus to have both parties in agreement that we
Speaker 2: need to have this reserve? Its five ten years away.
Speaker 1: I don't think it's that long. I think again, I
Speaker 1: don't want to make this a political podcast or anything
Speaker 1: like that, but I think the president. Let me stipulate this,
Speaker 1: and some of your viewers will be mad at me
Speaker 1: for saying this, but I think it's a factual statement.
Speaker 1: The president's polarized. Some people really like him and some
Speaker 1: people really don't like them, and so his detractors, if
Speaker 1: they don't like him, they're like, well, what does he like? Well,
Speaker 1: he likes crypto. Okay, well he likes crypto. I'm not
Speaker 1: gonna like crypto. And I think if you can get
Speaker 1: a less polarizing person in a position like that, I
Speaker 1: think you can move closer to something that's postpartisan. Was
Speaker 1: that too political? I don't think so. Right, I would
Speaker 1: give me a factual statement about where we are. You
Speaker 1: already get a lot of heat anyway, so I don't
Speaker 1: mind taking the heat. It's fine.
Speaker 3: I think a lot of this has been politicized, including
Speaker 3: the technology itself, which is unfortunate.
Speaker 1: But that's just where things are, I mean, but that
Speaker 1: should also make you very bullish. Can I explain to
Speaker 1: you why? Because every headwind that you can imagine has
Speaker 1: happened to this technology, Bitcoin solana, bureaucratic headwinds, lobbying headwinds,
Speaker 1: banking association headwinds, the sclerosis of Wall Street not moving
Speaker 1: quicker to adopt the technology or to adopt tokenization. Every
Speaker 1: different part of this that you could imagine is blowing
Speaker 1: in the face of these assets. And then look at
Speaker 1: where these assets have gone over the last fifteen or
Speaker 1: sixteen years. Now, yeah, granted they're off their cycle highs
Speaker 1: and they're off their all time highs, but think about
Speaker 1: where they are, think about the use cases, and think
Speaker 1: about the exponential adoption and the expansion of the wild
Speaker 1: It would be impossible to really study this and have
Speaker 1: a four or five year frame of mind and not
Speaker 1: be bullish. If you have a five minute frame of mind,
Speaker 1: then your bearers. Because we're in a bear market, and
Speaker 1: what happens to a bear market is people say this
Speaker 1: asset's dead and they walk away from it. But you know,
Speaker 1: underneath it is the growth and the exponential activity and
Speaker 1: the fact that it's just better technology.
Speaker 2: So on that note, every major Wall Street firm is
Speaker 2: tokenizing or has a tokenization strategy. It includes the stock
Speaker 2: exchanges looking to go twenty four to seven? Anthon, you
Speaker 2: have a plethora of experience in the markets. Where do
Speaker 2: you see the twenty four to seven markets in five
Speaker 2: years or so? And how does that change?
Speaker 1: Want sooner than that? I mean, I would say in
Speaker 1: the next two to three years you'll have twenty four
Speaker 1: to seven stock and bond trading. I mean, the Nasdaq
Speaker 1: announced the deal with Kraken where they're going to use
Speaker 1: Kraken's rail system, start the process of tokenizing stocks and
Speaker 1: let them trade twenty four to seven. We have the
Speaker 1: capability to do that. I would make the argument, you know,
Speaker 1: when I was a kid in the industry, we were
Speaker 1: literally T plus five. It took five days for a
Speaker 1: stock that you bought to land in your account. Now
Speaker 1: we're T plus one. Everybody knows that's listening into this. Generally,
Speaker 1: the people listening in are quite sophisticated. They know you
Speaker 1: could do it in T plus an hour through the blockchain,
Speaker 1: and so the question is whether that be better for
Speaker 1: us or worse for us, And I think it'd be
Speaker 1: better because when you have twenty four hour liquidity or
Speaker 1: twenty four hour activity, it changes your risk profile. Like
Speaker 1: if you've got a war going on, or you don't
Speaker 1: know if the straight of war moves is going to
Speaker 1: be open or not open, and you're looking to get
Speaker 1: out of something, Well, guess what's open. The crypto markets
Speaker 1: are open, so you know, Okay, that's where my source
Speaker 1: of liquidity is going to be in the overnight markets.
Speaker 1: And if you had everything overnight, then you'd have massive
Speaker 1: improvement in liquidity. So I think would also change the
Speaker 1: profile and perspective of people. So I generally think I
Speaker 1: generally like it. I think it happens in the next
Speaker 1: two to three years. How's Skybridge preparing for that? Is
Speaker 1: it too early for you, guys?
Speaker 2: Or will you have international teams or AI helping you
Speaker 2: trade twenty four to seven.
Speaker 1: I think anybody that's not using AARI right now is
Speaker 1: missing the boat. We use AI. We're long term investors
Speaker 1: at Skybridge, so we don't really have international teams. I
Speaker 1: think we're reasonably well positioned. I think my thing at
Speaker 1: Skybridge I have to almost be like a shrink or
Speaker 1: a life coach for some of my investors. Stuff. Calm down.
Speaker 1: I know bitcoin went from from here to one to
Speaker 1: twenty six and it's now in the high sixties, low seventies,
Speaker 1: and everyone's upset. Got the hair on fire. You can
Speaker 1: take this to the bank. Everybody is a long term
Speaker 1: investor until they have short term losses. Admit they have
Speaker 1: short term losses. They go crazy, They run around and
Speaker 1: yell at everybody, and then they blame you. But if
Speaker 1: you just calm down and you see the super cycle
Speaker 1: that we see, you're going to be incredibly well rewarded
Speaker 1: in the future. So my job relieves just keep clients
Speaker 1: clock calm at this moment.
Speaker 2: One more question for I let you go. You've got
Speaker 2: Skybridge Crypto investment. Any changes to your portfolio. I know
Speaker 2: you've been bullish on bitcoin, Avax, things like that.
Speaker 1: So we own Solana, we own Avax, I own Avalanche,
Speaker 1: I'm sorry, the Treasury, you know, the Avax one. We
Speaker 1: own some Forward which is a salon of Treasury, as
Speaker 1: well as Solana. We have some STRC, which is sort
Speaker 1: of the ill bir bearing securities coming out of strategy
Speaker 1: obviously have a very large position in bitcoin, and so
Speaker 1: you know, listen, I'm long term bullish on this stuff.
Speaker 1: It's not a great environment for it. But again, if
Speaker 1: you looked at where we were five years ago to
Speaker 1: where we are today, I love where we are. Oh.
Speaker 1: I can't believe the growth in this industry, and so
Speaker 1: I just believe that if we're sitting here, if I'm
Speaker 1: lucky enough be sitting here with you guys, five years
Speaker 1: from now, I think we'll look back and say, wow,
Speaker 1: those prices in twenty twenty six. I'm not sure why
Speaker 1: people were so negative given where we are today in
Speaker 1: twenty thirty one.
Speaker 2: All is a pleasure, Anthony, Thank you so much. All right,
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