WEBVTT 1 00:00:00.160 --> 00:00:02.919 If you're that person in the boardroom or a senior 2 00:00:02.960 --> 00:00:05.839 executive and you're still saying things like, you know, cryptos 3 00:00:05.839 --> 00:00:08.560 a scam, stuff like that, it's now embarrassing. We are 4 00:00:08.599 --> 00:00:11.800 moving towards you know, call it convenience, call it speed, 5 00:00:11.839 --> 00:00:15.919 called whatever you believe drives human behavior. This notion of 6 00:00:16.000 --> 00:00:19.800 collapsing these various silos. Do we really think that, when 7 00:00:19.839 --> 00:00:22.519 my twelve year old daughter is my age, that you'll 8 00:00:22.559 --> 00:00:25.359 have to log on to four different websites to purchase 9 00:00:25.399 --> 00:00:31.079 these assets. That's just silly. 10 00:00:33.200 --> 00:00:35.439 This episode is brought to you by Propy, which is 11 00:00:35.520 --> 00:00:39.039 leading to charge in putting real estate on chain. Propy 12 00:00:39.200 --> 00:00:41.600 is a game changer. You can buy and sell real 13 00:00:41.719 --> 00:00:45.799 estate with cryptocurrencies using the propty platform, which is powered 14 00:00:45.799 --> 00:00:48.479 by a blockchain of course, and they have a native 15 00:00:48.520 --> 00:00:51.679 token call pro And I've been an investor in the 16 00:00:51.840 --> 00:00:55.240 propy token since twenty eighteen. So Propy is a licensed 17 00:00:55.280 --> 00:00:59.119 Web three pioneer operating since twenty seventeen. They have facilitated 18 00:00:59.159 --> 00:01:02.840 over four billion dollars in transactions. They're putting titles and 19 00:01:02.880 --> 00:01:06.560 deeds on chain. They use coinbase for their crypto escro service. 20 00:01:06.920 --> 00:01:09.680 So this is a great platform and once again they 21 00:01:09.680 --> 00:01:11.519 are ahead of the curve when it comes to putting 22 00:01:11.519 --> 00:01:14.200 real estate on chain, and they just launched a great 23 00:01:14.239 --> 00:01:16.959 campaign where you can earn some of the Propy tokens, 24 00:01:17.359 --> 00:01:20.599 and it's simply by doing tasks such as sharing their 25 00:01:20.680 --> 00:01:24.000 vision video, signing up, and inviting a friend, and much 26 00:01:24.079 --> 00:01:26.560 more so. If you'd like to learn more about Propy, 27 00:01:26.760 --> 00:01:29.959 visit the link in the description. Hey everyone, welcome into 28 00:01:29.959 --> 00:01:32.879 the Thinking Crypto podcast. I'm your host, Tony Edward and 29 00:01:32.920 --> 00:01:35.879 we are recording at Station three in New York's Financial District. 30 00:01:36.040 --> 00:01:38.319 And joining me today is John Dagostino, who is the 31 00:01:38.359 --> 00:01:42.079 head of Strategy at Coinbase Institutional. This is John's second 32 00:01:42.079 --> 00:01:45.599 time on the podcast, and prior to joining Coinbase, John 33 00:01:46.120 --> 00:01:48.719 was the former head of Strategy for the New York 34 00:01:48.760 --> 00:01:52.159 Mercantile Exchange, where he led the effort to develop the 35 00:01:52.200 --> 00:01:56.280 first Middle East energy derivatives exchange in partnership with the 36 00:01:56.359 --> 00:02:00.359 Dubai government, which led him being the subject of two 37 00:02:00.599 --> 00:02:02.680 New York Times best selling books. 38 00:02:03.200 --> 00:02:05.680 John, great to see you. You know, best selling books 39 00:02:05.719 --> 00:02:08.039 New York Times nothing compared to being on your podcast. 40 00:02:08.080 --> 00:02:10.479 I'm a huge fan and I appreciate you inviting me back. 41 00:02:10.599 --> 00:02:14.759 Yeah, John, I really loved our conversation last time. You're 42 00:02:14.840 --> 00:02:16.879 very thoughtful, you have a lot of knowledge, So I 43 00:02:16.919 --> 00:02:18.560 figured I got to get you back on to talk 44 00:02:18.599 --> 00:02:21.560 about what's happening now in the market, but also all 45 00:02:21.599 --> 00:02:25.639 the great things coinbase is doing. Let's talk about the 46 00:02:25.680 --> 00:02:29.719 market because in October in Q four, October eleventh, the 47 00:02:29.840 --> 00:02:34.080 day that lives an infamy big liquidation event. However, we 48 00:02:34.120 --> 00:02:36.520 seem to be bottoming out right now, big coins up 49 00:02:36.520 --> 00:02:38.919 a bit. What did your take on everything that's been happening. 50 00:02:39.439 --> 00:02:44.599 So October tenth was a meaningful event. However, I would 51 00:02:44.680 --> 00:02:49.759 argue not an unpredictable event in the sense of these 52 00:02:49.800 --> 00:02:52.879 sort of builds up. Of these build up of leverage's 53 00:02:52.919 --> 00:02:57.639 natural build up of leverage. I guess a skewed speculative 54 00:02:57.840 --> 00:03:01.400 to hedging ratio. It's sort of endemic to this asset class. 55 00:03:01.400 --> 00:03:02.960 And it's not just endemic to crypto. I think it's 56 00:03:02.960 --> 00:03:05.960 indemic to ascid classes like commodities and other types of derivatives. 57 00:03:06.280 --> 00:03:08.439 And so this is a natural ebb and flow. These 58 00:03:08.439 --> 00:03:11.400 asset classes tend there's a ton of potential upside right 59 00:03:11.400 --> 00:03:14.599 when momentum is swinging up that tends to attract a 60 00:03:14.639 --> 00:03:20.280 certain type of market participant who's less risk tolerant. During 61 00:03:20.280 --> 00:03:22.960 those upswing periods, they tend take on excessive leverage. And 62 00:03:23.000 --> 00:03:24.560 so then you have this resetting. So you have this 63 00:03:24.639 --> 00:03:27.479 sort of upward escalating sign curve. Now, I know we 64 00:03:27.520 --> 00:03:29.199 all kind of want to get away with it from that. 65 00:03:29.240 --> 00:03:30.879 You know, some people just wanted to go up forever. 66 00:03:31.240 --> 00:03:33.520 It can't, by the way, mathematically it'll be bigger than 67 00:03:33.560 --> 00:03:36.800 the US economy. Right at some point, it may just 68 00:03:36.840 --> 00:03:39.039 be this is how the asset trades. And I think 69 00:03:39.039 --> 00:03:43.759 over time the standard deviation around that sign curve will diminish. 70 00:03:43.800 --> 00:03:45.599 But I think, you know, again, like I keep saying 71 00:03:45.639 --> 00:03:48.879 this that before crude oil went negative a few years ago, right, 72 00:03:49.000 --> 00:03:52.120 and it's an incredibly important assea class that's wildly liquid 73 00:03:52.240 --> 00:03:56.039 and highly institutional, and so it maybe this is just 74 00:03:56.319 --> 00:03:59.199 the nature of these acid classes for at least some time. 75 00:03:59.560 --> 00:04:04.159 So over tenth horrible cataclysmic. But but again, not everyone 76 00:04:04.159 --> 00:04:06.360 I know who's no sophisticated investor. It's not like out 77 00:04:06.360 --> 00:04:07.599 of the realm of possibility. 78 00:04:07.680 --> 00:04:07.800 Right. 79 00:04:07.840 --> 00:04:10.000 But so let's talk about some good things that came 80 00:04:10.000 --> 00:04:10.840 from October tenth. 81 00:04:10.919 --> 00:04:11.039 Right. 82 00:04:11.039 --> 00:04:17.279 One is there was. There wasn't this incredible fraud discovered. 83 00:04:17.279 --> 00:04:19.120 There wasn't you know everyone everyone every time there's a 84 00:04:19.600 --> 00:04:22.439 price correction, everyone starts, Oh, you know, there's some it's 85 00:04:22.439 --> 00:04:25.360 always this. It's always this mythical Asian hedge fund, right, right, 86 00:04:25.399 --> 00:04:27.600 and or an exchange blew up or this or that. 87 00:04:28.360 --> 00:04:30.480 So there was none of that. Right. There were some failures, 88 00:04:30.360 --> 00:04:32.519 as there always is going to be. But but we 89 00:04:32.519 --> 00:04:37.399 we went through a massive tide pulling out that didn't 90 00:04:37.439 --> 00:04:40.800 reveal a terror Luna or an FTX stuff like that. 91 00:04:40.800 --> 00:04:42.800 That's that's a good thing. That means that in general, 92 00:04:42.839 --> 00:04:47.000 at least the larger market participants have matured and managed 93 00:04:47.079 --> 00:04:50.480 risk properly. That's a good thing. Right. We didn't see 94 00:04:50.639 --> 00:04:52.959 rapid fraud, you know. We so a lot of people 95 00:04:53.000 --> 00:04:56.600 were hurt, but not in the way that requires massive 96 00:04:56.680 --> 00:04:59.839 regulatory intervention. Right. So so that's a we don't want 97 00:04:59.879 --> 00:05:01.800 to October tenth to happen. But if I look back 98 00:05:01.839 --> 00:05:05.639 and say, in a perfect world, it happened in the 99 00:05:05.639 --> 00:05:09.600 way that the worst possible scenario weren't realized. So because 100 00:05:09.639 --> 00:05:12.720 of that, we went into a kind of retrenchment. I 101 00:05:12.720 --> 00:05:14.839 don't know if we've bottomed. A lot of people were 102 00:05:14.839 --> 00:05:18.920 saying we needed a catalyst to bottom that. Catalysts might 103 00:05:18.959 --> 00:05:23.879 have been some recent regulatory signs of positive political pressure 104 00:05:23.920 --> 00:05:26.800 coming to create a fair resolution around the banking stable 105 00:05:26.800 --> 00:05:31.040 cooin issue. But I think it's just it's just all 106 00:05:31.079 --> 00:05:33.759 the market participants licking their wounds for a few months 107 00:05:34.240 --> 00:05:37.680 realizing okay, we were shaken up, but our risk parameters 108 00:05:37.680 --> 00:05:41.800 worked out okay, and then slowly and carefully entering into 109 00:05:41.800 --> 00:05:44.000 the market again. And I do think that's what we're seeing. 110 00:05:44.600 --> 00:05:46.839 Yeah, it's funny, John, because we didn't see the same 111 00:05:46.920 --> 00:05:50.519 type of parabola parabola I should say, where you had 112 00:05:50.560 --> 00:05:53.519 the euphoria and a lot of movement behind the market 113 00:05:53.560 --> 00:05:55.639 that can be seen in previous bull markets. So I 114 00:05:55.680 --> 00:05:58.319 almost think on the downside, you may not have that 115 00:05:58.480 --> 00:06:03.360 same type of extreme dream, extreme selling and fear, even 116 00:06:03.399 --> 00:06:04.879 though we're seeing a bit of it on the you know, 117 00:06:05.040 --> 00:06:08.240 sentiment charts. So maybe you know there was a diminished 118 00:06:08.279 --> 00:06:10.160 bull market and also a diminished bear market. 119 00:06:10.199 --> 00:06:12.399 Now we're experiencing It's it's great observation and we've we've 120 00:06:12.399 --> 00:06:13.920 been saying for a while. For a few months, I've 121 00:06:13.959 --> 00:06:16.160 been very public about this that there's a massive disconnect 122 00:06:16.240 --> 00:06:20.000 between the institutional fundamentals and market fundamentals and retail fear. 123 00:06:21.240 --> 00:06:24.720 I think we have. We have levered and speculative bubbles 124 00:06:24.720 --> 00:06:29.680 within crypto periodically. We also have levered and speculative sentiment 125 00:06:29.720 --> 00:06:32.680 bubbles in both ways. Right, we tend to be fairly 126 00:06:32.680 --> 00:06:36.360 bipolar as an asset class. And so just look at 127 00:06:36.360 --> 00:06:38.279 the numbers recently, right, and in the last couple of weeks, 128 00:06:38.319 --> 00:06:43.439 we're seeing increased ETF flows. We're seeing significant price increases, 129 00:06:43.720 --> 00:06:46.600 rallying at bit cooin with still negative funding rates, slightly 130 00:06:46.680 --> 00:06:49.639 negative funding rates. That's all positive. We're seeing increasing prices, 131 00:06:49.680 --> 00:06:52.480 decreasing open interest on the future's and derivative side. These 132 00:06:52.519 --> 00:06:55.199 are all signs of a healthy market. Yet the fear 133 00:06:55.240 --> 00:06:58.079 and greed index is still at ten. So I don't 134 00:06:58.079 --> 00:07:01.199 want to I hate telling people how to fear, but 135 00:07:01.240 --> 00:07:04.120 I would. I've been gently reminding folks for the last 136 00:07:04.120 --> 00:07:07.040 i'd say month month and a half, is if you 137 00:07:07.079 --> 00:07:10.560 can afford to invest like an institution, and I suggest 138 00:07:10.560 --> 00:07:12.839 everyone should. I've had a big proponent of dollar cross averaging, 139 00:07:12.920 --> 00:07:15.600 only investing what you can lose. It invests that way 140 00:07:15.639 --> 00:07:18.399 because that allows you to think like a sovereign wealth 141 00:07:18.399 --> 00:07:21.439 fund or an institution that has you know, three, five, seven, 142 00:07:21.519 --> 00:07:25.040 ten year time horizons. And if you can invest in 143 00:07:25.079 --> 00:07:28.399 that way and trade that way and think that way, 144 00:07:28.959 --> 00:07:31.639 then then you have the luxury of looking at their 145 00:07:31.680 --> 00:07:35.040 behaviors and they're not panicking and they haven't been panicking 146 00:07:35.279 --> 00:07:37.800 because they're seeing what I'm seeing, which is nothing has 147 00:07:37.879 --> 00:07:40.439 changed in the last six months on the downside. It's 148 00:07:40.519 --> 00:07:44.800 only been upside. We have regulatory leaders now in the US, 149 00:07:44.959 --> 00:07:49.160 Paul Adkins and Mike Sellig, who are every day signaling 150 00:07:49.360 --> 00:07:55.000 with language that the most optimistic crypto bitcoin Maxie was 151 00:07:55.040 --> 00:07:58.079 talking about a year ago. That's an extraordinary Paul Akins 152 00:07:58.160 --> 00:07:59.680 came out, I think just twenty four hours ago and 153 00:07:59.720 --> 00:08:03.639 said we gonna have zero latency atomic settlement soon t zero. 154 00:08:04.199 --> 00:08:09.680 Mike Sellig is is a brilliant and talking about the 155 00:08:09.720 --> 00:08:13.480 cfcc's role in prediction markets in defile. I mean, the 156 00:08:13.480 --> 00:08:16.600 political side is fantastic, but but the regulatory side talk 157 00:08:16.639 --> 00:08:23.160 about a one to eighty that is consistent now over 158 00:08:23.199 --> 00:08:26.639 the over the last six months and a wonderfully bullish 159 00:08:26.720 --> 00:08:27.480 catalyst and. 160 00:08:27.480 --> 00:08:31.240 Sign Yeah, great points there, and is the dichotomy of 161 00:08:31.279 --> 00:08:34.200 what's happening on the institutional side and how the retail 162 00:08:34.279 --> 00:08:37.440 masses they're feeling. It couldn't be further apart, because, like 163 00:08:37.480 --> 00:08:39.919 you said, there's so much building. I mean, just yesterday 164 00:08:40.000 --> 00:08:41.879 Morgan Stanley said, Hey, we're gonna file for our own 165 00:08:41.879 --> 00:08:43.200 bigcoin ETF. 166 00:08:42.720 --> 00:08:45.600 And they're gonna use coinbas as as custodian, which was 167 00:08:45.600 --> 00:08:48.919 which was great, And uh, there was that announcement. Look, 168 00:08:49.039 --> 00:08:52.080 I'll leave their competitors. I don't care. Kraken's announcement about 169 00:08:52.080 --> 00:08:54.960 the FED window fantastic, great for them. I think it's wonderful. 170 00:08:55.279 --> 00:08:55.440 Uh. 171 00:08:55.480 --> 00:08:58.240 Ice investing in ok x. I used to compete with 172 00:08:58.320 --> 00:09:00.440 against Jeff Sprecker at ninem X. I can't wait to 173 00:09:00.519 --> 00:09:03.519 rip his face off again. Like he's a legend, and 174 00:09:03.559 --> 00:09:07.039 I admire him tremendously. I loved competing against him back then, 175 00:09:07.320 --> 00:09:09.519 and I'm looking forward to competing against him again. But 176 00:09:09.799 --> 00:09:12.039 you know, I love all that. I think it's great. 177 00:09:12.080 --> 00:09:14.320 I think it's great when high quality players. You know, 178 00:09:15.120 --> 00:09:17.440 he's trying to find the next coin base, right, But 179 00:09:17.840 --> 00:09:22.519 all that's wonderful. I'm not seeing a lot of structurally 180 00:09:22.559 --> 00:09:26.240 negative signs. I struggle to no one can point them 181 00:09:26.240 --> 00:09:29.759 out to me, except you know, short term price action, 182 00:09:29.879 --> 00:09:33.080 and if you believe, if you believe as I do, 183 00:09:33.279 --> 00:09:34.759 that it's just talk a bit bitcoin for a second. 184 00:09:34.799 --> 00:09:37.240 If you believe that bitcoin as I do, is a 185 00:09:37.279 --> 00:09:40.919 wonderful long term hedge against monetary debasement, Monetary debasement does 186 00:09:40.960 --> 00:09:43.519 not occur over weeks or months or even years. It 187 00:09:43.519 --> 00:09:46.639 occurs over decades, and so you have to measure your hedge. 188 00:09:47.120 --> 00:09:51.360 Duration should match duration. And so if you're a short 189 00:09:51.440 --> 00:09:54.360 term trader, you should like the volatility to some degree, 190 00:09:54.600 --> 00:09:56.639 but just be aware. If you're a short term retail trader, 191 00:09:56.639 --> 00:10:00.000 you're up against folks who really really know what they're doing. 192 00:10:00.399 --> 00:10:02.440 On the other side, who have the ability and balance 193 00:10:02.519 --> 00:10:06.120 sheet to hedge with various OTC products and offshore and 194 00:10:06.159 --> 00:10:08.879 on shore, so it would just be very cautious about 195 00:10:08.919 --> 00:10:09.840 trading it in that way. 196 00:10:10.039 --> 00:10:13.200 Pardon the interruption. Hi, I'm Tony. I'm the host of 197 00:10:13.240 --> 00:10:15.679 the Thinking Crypto podcast. I wanted to ask you if 198 00:10:15.720 --> 00:10:18.120 you can please support the podcast by hitting the like 199 00:10:18.159 --> 00:10:20.679 button subscribing. If you haven't as yet, you can leave 200 00:10:20.720 --> 00:10:22.840 a comment below as well, And if you're listening on 201 00:10:22.879 --> 00:10:25.919 a podcast platform such as Spotify, Apple or wherever you 202 00:10:25.960 --> 00:10:28.919 get your podcasts, please be sure to follow and hit 203 00:10:28.960 --> 00:10:31.039 the five star rating. I'll let you get back to 204 00:10:31.080 --> 00:10:34.000 the content. Thank you so much. Well, that's the saying goes, 205 00:10:34.559 --> 00:10:37.919 bite a blood on the streets right when, and also 206 00:10:38.279 --> 00:10:41.240 when many are fearful, that's the time to be greedy. 207 00:10:41.279 --> 00:10:43.480 And when the many are greedy, that's the time. 208 00:10:43.360 --> 00:10:45.679 To be sure. I've never failed me before. I keep 209 00:10:45.679 --> 00:10:48.159 a lit little piece of paper in my wallet post 210 00:10:48.399 --> 00:10:50.799 right after nine eleven or right after nine eleven in 211 00:10:50.799 --> 00:10:53.360 New York City, two best trades in my life. Ten 212 00:10:53.440 --> 00:10:56.960 days after nine eleven, I bought my first apartment and 213 00:10:57.120 --> 00:11:00.480 I bought city stock at I think printed at like 214 00:11:00.559 --> 00:11:02.919 ninety eight cents, like I forget these. I printed like 215 00:11:03.039 --> 00:11:05.919 almost the low on City because I was sitting there going, okay, 216 00:11:06.120 --> 00:11:10.240 if Citi's dead, America, the entire world at this point, 217 00:11:10.279 --> 00:11:14.559 who cares? Right, We're being ridiculous here, and so two 218 00:11:14.600 --> 00:11:17.559 best trades in my life. Best tripled my apartment value 219 00:11:17.639 --> 00:11:20.120 in five years, because I remember back then, who would 220 00:11:20.120 --> 00:11:20.919 ever live in New York? 221 00:11:20.960 --> 00:11:21.120 Ever? 222 00:11:21.159 --> 00:11:22.840 Again? New York is New York is done. 223 00:11:22.879 --> 00:11:24.519 They said the same thing after COVID, and. 224 00:11:24.519 --> 00:11:26.120 They're saying the same thing about Dubai. Now, it's just 225 00:11:26.159 --> 00:11:29.840 it's just ridiculous. So that now is the time to 226 00:11:29.919 --> 00:11:33.679 go in through these these hyperbolic periods of of of fear. 227 00:11:34.399 --> 00:11:35.559 It's never failed me before. 228 00:11:36.159 --> 00:11:40.320 Yeah, it's so fascinating how market cycles, market psychology and 229 00:11:40.399 --> 00:11:44.159 sentiment works, right, John, And you have to not necessarily 230 00:11:44.159 --> 00:11:46.399 look at the narratives, but look at the charts and 231 00:11:46.440 --> 00:11:50.399 the principles of markets and investing, because there's an emotional 232 00:11:50.519 --> 00:11:52.879 roller coaster. But you have to keep that at bay. 233 00:11:53.559 --> 00:11:55.919 It's hard, and it's hard, I get it, especially especially 234 00:11:55.960 --> 00:11:57.919 if you're emotionally invested. If you're investing, you know, maybe 235 00:11:57.960 --> 00:11:59.720 a little bit too much, if you're I find most 236 00:11:59.720 --> 00:12:02.159 people don't invest more than more than they should. They 237 00:12:02.440 --> 00:12:04.879 just mismatch duration. They invest money that they need short 238 00:12:04.960 --> 00:12:09.039 term in assets that you you really shouldn't. So, you know, 239 00:12:09.080 --> 00:12:11.240 one of the things I really love about coinbases, uh, 240 00:12:11.320 --> 00:12:13.039 you know, I find them to be kind of responsible, 241 00:12:13.080 --> 00:12:15.360 like you know, I you know, I'm a spokesperson for 242 00:12:15.399 --> 00:12:17.559 the firm, and they know how I feel about this topic. 243 00:12:17.600 --> 00:12:19.399 And I've never been told you know, no no push 244 00:12:19.480 --> 00:12:23.600 you know, push push speculative you know, irrational behavior like so, So, 245 00:12:23.960 --> 00:12:26.759 I do think it's on the It's on the players 246 00:12:26.759 --> 00:12:30.279 in the market, the exchanges, the big asset managers. I 247 00:12:30.279 --> 00:12:33.039 do think it's incumbent upon them to continue to push 248 00:12:33.080 --> 00:12:35.240 this this narrative, no different if I was talking somebody 249 00:12:35.279 --> 00:12:40.440 about deriatives, trading, edi edy, any idiosyncratic, implicitly levered asset. 250 00:12:41.240 --> 00:12:43.600 People should do what they want. Ultimately, adults should be 251 00:12:43.600 --> 00:12:44.919 able to do what they want with their own money. 252 00:12:45.320 --> 00:12:47.679 But I think it's incumbent upon institutions like ours to 253 00:12:47.799 --> 00:12:51.679 just remind people that this type of volatility is probably 254 00:12:51.679 --> 00:12:54.159 not going away. It's gonna get it's gonna get better, 255 00:12:54.600 --> 00:12:56.600 but it's probably not going away at least in my 256 00:12:56.759 --> 00:12:57.679 the rest of my career. 257 00:12:57.840 --> 00:12:59.720 So John would all the things we just talked about 258 00:12:59.840 --> 00:13:02.399 more again, Stanley and a lot of these big institutions, 259 00:13:02.440 --> 00:13:05.000 ICE investing in ok X and UH, the SEC and 260 00:13:05.039 --> 00:13:08.879 the CFDC putting rules together. It feels like we've crossed 261 00:13:08.879 --> 00:13:12.279 the chasm where institutions no longer viewed it as taboo. 262 00:13:12.320 --> 00:13:15.519 But they need to have a strategy. It's a must, 263 00:13:15.559 --> 00:13:18.720 it's critical, and everybody's on the raceline ready to go. 264 00:13:18.799 --> 00:13:20.039 Maybe when the clarity. 265 00:13:19.720 --> 00:13:24.159 Act passes absolutely. Look, every major financial institution is hiring 266 00:13:24.200 --> 00:13:28.600 out a senior senior crypto team. I'm getting the calls 267 00:13:28.600 --> 00:13:31.919 to like ever, everybody's getting you yeah, not not not 268 00:13:32.159 --> 00:13:35.440 going anywhere. I love point uh, but but every and 269 00:13:35.480 --> 00:13:38.080 when I say every, every major brand name financial institutions, 270 00:13:38.159 --> 00:13:41.679 even the ones where whose CEOs are publicly still you know, 271 00:13:41.720 --> 00:13:44.559 it's clear. And I said this on another show recently, 272 00:13:44.559 --> 00:13:46.639 but I do think at this point, if you're that 273 00:13:46.840 --> 00:13:49.559 person in the boardroom or a senior executive and you're 274 00:13:49.639 --> 00:13:52.159 still saying things like you know, crypto's a scam and 275 00:13:52.159 --> 00:13:55.120 stuff like that, it's now embarrassing to be perfectly honest. Right. 276 00:13:55.159 --> 00:13:56.919 So now I do think some people will like just 277 00:13:57.000 --> 00:13:58.840 ride out the rest of their career. I think because 278 00:13:58.840 --> 00:14:01.240 they're embarrassed. They're like they're the if you're if you've 279 00:14:01.240 --> 00:14:04.200 been very vocally against this asseat class, it's fine, by 280 00:14:04.200 --> 00:14:05.759 the way, I think we have to do a better 281 00:14:05.840 --> 00:14:07.919 job like thoughtful, like like Uriel Rebeti is a very 282 00:14:07.919 --> 00:14:10.519 good friend of mine. Right, He's a he I take 283 00:14:10.559 --> 00:14:14.799 everything he says very seriously. We disagree. He's a thoughtful critic. 284 00:14:15.519 --> 00:14:19.679 He's a thoughtful critic. There are non thoughtful critics, and 285 00:14:19.720 --> 00:14:21.120 I think if you're one of those people, it's a 286 00:14:21.159 --> 00:14:23.720 bit embarrassing at this point. So you have to either 287 00:14:23.759 --> 00:14:26.399 have two choices. You can admit I was as wrong 288 00:14:26.440 --> 00:14:28.879 as wrong can be, or you can just ride out 289 00:14:28.879 --> 00:14:31.200 your career and hope that you know, you'll never have 290 00:14:31.240 --> 00:14:33.000 to deal with it, and you might not. My mother 291 00:14:33.200 --> 00:14:37.399 just switched to online banking, just literally this year. She 292 00:14:37.720 --> 00:14:41.240 deferred it for forty years because she hates it. But 293 00:14:41.240 --> 00:14:43.559 but yeah, look, I think I think we are you know, 294 00:14:43.600 --> 00:14:45.200 I love this notion the coin base talks about this 295 00:14:45.279 --> 00:14:49.000 everything exchange, because I do think that we are moving 296 00:14:49.039 --> 00:14:51.879 towards uh, you know, call it convenience, call it speed, 297 00:14:51.879 --> 00:14:55.279 call it whatever whatever you believe drives human behavior. This 298 00:14:55.399 --> 00:14:59.799 notion of collapsing these various silos, it makes sense for 299 00:14:59.879 --> 00:15:01.759 me I perspective, like why should I go to three 300 00:15:01.759 --> 00:15:06.080 different systems to buy credit? You know, Muni's equities, commodities, crypto, 301 00:15:06.120 --> 00:15:07.799 Like why should I go to four different systems to 302 00:15:07.799 --> 00:15:10.200 buy those? So efficiency is great, but just from a 303 00:15:10.240 --> 00:15:13.080 practical perspective, when you start to collapse those systems, you 304 00:15:13.480 --> 00:15:16.559 do things like cross margin financing. You can lend against 305 00:15:16.639 --> 00:15:20.080 cross collatterized assets, which is what tokenization does, and you 306 00:15:20.240 --> 00:15:24.200 just unlock put aside twenty four seven trading, which is 307 00:15:24.200 --> 00:15:27.240 also extraordinary, and watching people hedge their exposure to the 308 00:15:27.240 --> 00:15:30.679 Iran war on DeFi on hyper liquid, you know, over 309 00:15:30.720 --> 00:15:34.879 the weekend prior to the open that frees up tremendous 310 00:15:34.879 --> 00:15:37.600 amounts of value. But there is this notion of you know, 311 00:15:38.159 --> 00:15:40.240 do we really think that when my twelve year old 312 00:15:40.320 --> 00:15:42.840 daughter is my age, that you'll have to log on 313 00:15:42.919 --> 00:15:46.639 to four different websites to purchase these assets. That's that's 314 00:15:46.679 --> 00:15:47.799 just silly. 315 00:15:47.759 --> 00:15:50.519 Right, So, and this is along the lines of what 316 00:15:50.600 --> 00:15:53.279 coinbase is building, because you just recently added stock trading 317 00:15:53.759 --> 00:15:54.799 things along in the futures. 318 00:15:54.919 --> 00:15:57.600 Now you've heard and Mike Sellen just announced recently that 319 00:15:57.720 --> 00:16:01.480 US purpose are coming as soon as April. You can't. 320 00:16:01.879 --> 00:16:04.519 One of the reasons I'm not. I have the luxury. 321 00:16:04.600 --> 00:16:06.399 It's easy for me to say this because we have 322 00:16:06.440 --> 00:16:08.639 an amazing policy team that's fighting tooth and nail to 323 00:16:08.639 --> 00:16:11.480 make sure American consumers get get good choice. So I 324 00:16:11.559 --> 00:16:13.480 kept the luxuries saying like, I'm not worried about that. 325 00:16:14.240 --> 00:16:16.799 They have to worry about it. I am not worried 326 00:16:16.879 --> 00:16:21.360 because because it is absolutely the right move for them 327 00:16:21.480 --> 00:16:24.879 from a technology perspective, from a American consumer perspective. And 328 00:16:24.919 --> 00:16:28.519 I just know eventually, over time that wins out and maybe, 329 00:16:28.679 --> 00:16:30.159 you know, maybe we wind up with a clarity act 330 00:16:30.200 --> 00:16:33.240 that we don't love. Who knows, but I know over 331 00:16:33.320 --> 00:16:35.919 time it'll just get whittled down for the benefit of 332 00:16:35.960 --> 00:16:39.000 the American consumer. No different from my new Uber was 333 00:16:39.000 --> 00:16:41.360 going to win, right, Remember when all the municipalities were 334 00:16:41.360 --> 00:16:43.639 fighting Uber and like for a while it was touch 335 00:16:43.679 --> 00:16:45.679 and go. But like then you use the app and 336 00:16:45.679 --> 00:16:48.720 you're like, this is just clearly better. It's clearly better. 337 00:16:48.720 --> 00:16:52.120 It's clearly going to win. They can stall it for 338 00:16:52.200 --> 00:16:56.240 a while, but eventually the consumer votes with their feet, 339 00:16:56.639 --> 00:16:59.679 votes with their vote, votes with their dollars, and you know, 340 00:17:00.639 --> 00:17:03.000 you can accept zero point zero one interest rate or 341 00:17:03.000 --> 00:17:06.200 you can accept you know, high threes, and you know 342 00:17:06.359 --> 00:17:08.799 eventually that that wins out. 343 00:17:09.480 --> 00:17:11.240 And to your point, you know, there's going to be 344 00:17:11.279 --> 00:17:13.720 a generational shift. Gen Z and these folks, they're more 345 00:17:13.759 --> 00:17:17.079 digital than even myself, and I think on myself as digital. 346 00:17:17.119 --> 00:17:19.359 But you know, you give the example of your mom, 347 00:17:19.480 --> 00:17:22.240 right finally moving to online banking, really growing up in 348 00:17:22.279 --> 00:17:24.519 a digital world, and they're going to inherit a lot 349 00:17:24.559 --> 00:17:27.079 of money, and they're going to start investing, and it's 350 00:17:27.119 --> 00:17:30.599 going to be via the mobile platform, via wallets. 351 00:17:30.359 --> 00:17:35.160 And they're aware of the inflation return gap that exists. 352 00:17:35.160 --> 00:17:39.079 They're keenly aware, even even folks who aren't particularly financially focused. 353 00:17:39.079 --> 00:17:42.240 I hate saying financially alliterated non financially just dude, because 354 00:17:42.400 --> 00:17:44.799 just because you're not aware of something doesn't mean you're 355 00:17:45.039 --> 00:17:46.920 not capable of being aware. It's just they want to 356 00:17:46.920 --> 00:17:48.599 have different priorities in their life, right, So not everyone 357 00:17:48.680 --> 00:17:51.039 get up every day spending time thinking about their money. 358 00:17:51.400 --> 00:17:54.400 But I think the average young person is far more 359 00:17:54.440 --> 00:17:58.480 aware of that gap between inflation and earning potential. And 360 00:17:58.559 --> 00:18:01.200 so that you know, difference two point zero one percent 361 00:18:01.359 --> 00:18:04.519 interest and three and a half percent interest compounded over 362 00:18:04.559 --> 00:18:09.000 a lifetime is massive. That's differen between putting your kids 363 00:18:09.000 --> 00:18:12.039 into school. That's owning a home and not owning a home. 364 00:18:13.039 --> 00:18:16.440 So I think they'll demand it. I do, and I 365 00:18:16.519 --> 00:18:18.200 understand why the banks are fighting. I get it. I 366 00:18:18.680 --> 00:18:20.640 try to be very sanguine about this stuff. I try 367 00:18:20.640 --> 00:18:24.039 not to ascribe malice where where self interest is the 368 00:18:24.079 --> 00:18:27.119 more likely excuse. I get it. It's a fantastic motel. 369 00:18:27.160 --> 00:18:28.640 I would love to be able to borrow at zero 370 00:18:28.680 --> 00:18:32.119 and borrow it at take in five percent, and lend 371 00:18:32.160 --> 00:18:34.200 out at zero. I'd love to do that. Who would 372 00:18:34.319 --> 00:18:36.839 love to do that? So I fully expect they're going 373 00:18:36.880 --> 00:18:40.519 to completely protect that mote. But their arguments are just silly. 374 00:18:40.640 --> 00:18:43.160 They're just silly, like this notion that you're comparing a 375 00:18:43.279 --> 00:18:46.759 levered bank that is putting assets at risk in the 376 00:18:46.799 --> 00:18:50.640 loan portfolio to a one to one regulated backed narrow bank. 377 00:18:52.559 --> 00:18:55.119 That argument won't win. I know it won't win. 378 00:18:55.799 --> 00:18:58.920 And I've often given the analogy. I'm a JP Morgan 379 00:18:59.000 --> 00:19:02.839 Chase customer. Yeah, and I have my regular checking in 380 00:19:02.880 --> 00:19:06.079 savings and guess what I'm getting zero point zero one 381 00:19:06.119 --> 00:19:08.799 percent or whatever it is in my savings. But what 382 00:19:08.880 --> 00:19:11.279 I'm currently doing because of stable coins and crypto, I 383 00:19:11.319 --> 00:19:15.240 put some money in USDC on coinbase, I'm earning my rewards. 384 00:19:15.240 --> 00:19:16.640 I've been doing this for over a year and a 385 00:19:16.680 --> 00:19:20.000 half Coinbase one customer, and I'm also staking and I'm 386 00:19:20.000 --> 00:19:21.079 getting more returns. 387 00:19:21.160 --> 00:19:23.440 John, Well, you're taking some risk with saking, obviously you 388 00:19:23.519 --> 00:19:24.960 take right you're taking so and you should be paying 389 00:19:24.960 --> 00:19:26.359 you should be by the way, you should be paid 390 00:19:26.359 --> 00:19:29.559 accordingly by taking that excess risk. And that's a wonderful, 391 00:19:29.599 --> 00:19:32.759 a wonderful thing. That's the that's the whole point. So 392 00:19:33.039 --> 00:19:34.799 I think I think that's great. So so taking that 393 00:19:34.880 --> 00:19:41.119 option away under the guise of minimizing risk again, it's 394 00:19:41.160 --> 00:19:43.599 it's it's it's it's. It fails on the merits, it 395 00:19:43.599 --> 00:19:46.440 fails on the tech, it fails on the economic logic. 396 00:19:46.920 --> 00:19:48.599 And so I am you know, I have the luck 397 00:19:48.640 --> 00:19:50.440 you're saying this, but I am. I am very very 398 00:19:50.440 --> 00:19:54.039 optimistic that regardless of which administration wins in midterms or 399 00:19:54.160 --> 00:19:58.599 that eventually, the American consumer votes with their feet, votes 400 00:19:58.599 --> 00:20:00.960 with their vote, votes with their wallet, and will not 401 00:20:01.000 --> 00:20:03.880