Speaker 1: The new administration you know, clearly is wanting to make
Speaker 1: you know, the US the capital for crypto and make
Speaker 1: sure that we're not missing a beat when it comes
Speaker 1: to innovation in general and with respect to crypto, and
Speaker 1: I think that's very, very positive.
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Speaker 2: Hey everyone, welcome into the Thinking Crypto podcast. I'm your
Speaker 2: host Tony Edward and my guest today is Bobby Zagoda,
Speaker 2: who is the CEO of Bitstamp USA and global Chief
Speaker 2: Commercial Officer. Bobby. Great to have you on.
Speaker 1: Great to be here, Tony.
Speaker 2: Bobby, as we were talking about before the recording, I'm
Speaker 2: an og user bitstamp. I remember back in I think
Speaker 2: it was twenty seventeen, transferring funds over to bitstamp in
Speaker 2: the Europe in Europe, buying some bitcoin and then using
Speaker 2: some of that bitcoin to buy all coins. So I
Speaker 2: have a lot of background with bitstamp, so I'm really
Speaker 2: excited to chat with you and learn about what you
Speaker 2: guys are up to these days. But let's start with
Speaker 2: your background. Tell us about yourself, where you're from, and
Speaker 2: your professional background.
Speaker 1: Well, first of all, great to hear that you're a customer.
Speaker 1: Love to hear that. Yeah, I've been with bits stamp
Speaker 1: three and a half years. Just about I joined as
Speaker 1: a CEO for the US, as you mentioned, and shortly
Speaker 1: thereafter it took on this global Chief Commercial Officer role.
Speaker 1: Prior to this, I was at Kraken, so another crypto exchange.
Speaker 1: I was a chief commercial officer there for three years,
Speaker 1: and prior to that, I was at I was on
Speaker 1: the traditional financial services side at the Chicago Mercantile Exchange
Speaker 1: CME Group, and I was a member of the leadership
Speaker 1: team there. I ran a couple of different divisions and
Speaker 1: as a matter of fact, it was there that I
Speaker 1: got involved in crypto interestingly, because I had responsibility for
Speaker 1: our venture capital CEMI Ventures, and that team started pitching
Speaker 1: me on crypto and blockchain investments in late twenty thirteen,
Speaker 1: and we started investing in twenty fourteen in some notable
Speaker 1: early stage crypto companies, including Ripple for instance, and I
Speaker 1: got quite involved as a board observer at Ripple for
Speaker 1: a couple of years, and it really opened up my
Speaker 1: mind to the possibilities of this technology, not only for
Speaker 1: the world and for society, but for a company like
Speaker 1: CME Group. And we ended up working really hard to
Speaker 1: get that board of directors comfortable with the idea of
Speaker 1: a bitcoin futures product, which which we ultimately did, although
Speaker 1: it was it was difficult. You know, we were seeking
Speaker 1: approval for this in twenty sixteen, which was still quite
Speaker 1: early for let's call it mainstream traditional financial services companies
Speaker 1: to be thinking about such a thing, but we were
Speaker 1: successful in getting and getting the board to approve it.
Speaker 1: We launched it in twenty seventeen. Of course, many people
Speaker 1: thought we were crazy at the time, but it turned
Speaker 1: out to be a really, really strong product for them.
Speaker 2: That's amazing that you were part of launching bitcoin futures
Speaker 2: at the CME, and today's day, the CME is one
Speaker 2: of the kind of goal posts with the futures markets
Speaker 2: to having futures markets for different assets in the crypto space.
Speaker 2: I think even it's you know, when it comes to
Speaker 2: like getting spot ETF approves approved, excuse me, they kind
Speaker 2: of look to the CME to ensure the futures market
Speaker 2: is established there.
Speaker 1: Yeah, it obviously plays a critical role in the evolution
Speaker 1: of asset classes and assets, not just the CME, but
Speaker 1: the futures marketplace in general. It becomes the price discovery
Speaker 1: venue or venues for assets as they mature, and we're
Speaker 1: seeing that in the crypto marketplace as well. Today the
Speaker 1: derivative side of the crypto marketplace is growing so fast
Speaker 1: and is so large today it is becoming the price
Speaker 1: discovery mechanism for for lots of instruments, including ETFs of
Speaker 1: course or eventually ETFs. Of course.
Speaker 2: With your history right going back to like twenty fifteen
Speaker 2: and so forth and getting involved in crypto, what's it
Speaker 2: like looking back ten years later, we're in twenty twenty five,
Speaker 2: of course, and seeing the growth with trad fi here,
Speaker 2: with spottytf stable cooin market is booming. You have a
Speaker 2: pro crypto government and all these things in place.
Speaker 1: It's just it's just unbelievable. And you know, particularly when
Speaker 1: the ETF approvals happened last year. You know, even though
Speaker 1: there was a lot of regulatory and still is you know,
Speaker 1: you know, important regulatory gaps that need to be filled
Speaker 1: and another challenges. But when the ETF approvals came through,
Speaker 1: I you know, I took a moment to talk to
Speaker 1: some of my colleagues and some of my former colleagues
Speaker 1: and just say, hey, can we just enjoy this for
Speaker 1: a moment. Can we just set back This was unthinkable
Speaker 1: you know a few years ago, and and uh and
Speaker 1: so really quite amazing that that that we are seeing
Speaker 1: the progress and the mainstream acceptance both on the part
Speaker 1: of institutions and and retail investors that were that we're
Speaker 1: seeing now. And it also brings brings home for me
Speaker 1: the level of vision that you know, the godfathers have,
Speaker 1: such as the founders of bit stamped. You know they
Speaker 1: bit stamp was founded in twenty eleven, right, it's the
Speaker 1: longest running crypto exchange. You know, the foresight that those
Speaker 1: brilliant young men have at that time, and not just
Speaker 1: that you know, Brian Armstrong, Jesse Powell. You know, there's
Speaker 1: these guys saw something, believed in it, you know, and
Speaker 1: and really invested, you know, invested their heart and soul
Speaker 1: in it. And so so fancy your question. From my standpoint,
Speaker 1: I've been in the markets now for six or seven
Speaker 1: years full time. It's amazing to see where we are.
Speaker 1: But it also reminds me what level of vision started
Speaker 1: back in back with the white paper.
Speaker 2: Oh absolutely, And do you feel like we've crossed the chasm,
Speaker 2: hit the tipping point where there's no going back, like
Speaker 2: the genies at the bottle of this thing is now
Speaker 2: we're hitting the ground running. You got trad Fi, you
Speaker 2: got the government on board, there's change in the regime
Speaker 2: of the SEC, and there's a crypto task force being
Speaker 2: formed of the SEC now that innovators and entrepreneurs can
Speaker 2: really put their heads down, start working, not worry about
Speaker 2: you know, getting a walls notice and things like that,
Speaker 2: and we might see a big boom this year in
Speaker 2: the industry.
Speaker 1: Yeah, I do. I think it's pats the tipping point,
Speaker 1: to use your language, there's no going back. The validity
Speaker 1: and frankly, the brilliance of the technology, the underpinning technology
Speaker 1: and all of the potential applications around it not just
Speaker 1: in financial services, but as has been well discussed in
Speaker 1: you know, identity management and supply chain management, and you know,
Speaker 1: the list goes on and on. There's there's no question
Speaker 1: that the United States and the world are going to
Speaker 1: you know, make the most of this opportunity in lots
Speaker 1: of different ways and lots of different forms. And it
Speaker 1: might not be the way that it was originally envisioned
Speaker 1: by by some of the godfathers I was just mentioning,
Speaker 1: but no question it will be. Uh. It will create
Speaker 1: great opportunities for individuals, for investors and for you know,
Speaker 1: people who are running businesses and moving money and all
Speaker 1: those good things. And I think in particular in the US,
Speaker 1: as you mentioned, right, the US has been you know,
Speaker 1: there's been a bit of a governor on our progress
Speaker 1: by virtue of the lack of regulatory clarity and the
Speaker 1: fact that the past administration you know, seem to be
Speaker 1: you know, actively or behind the scenes trying to slow
Speaker 1: trying to slow the process. You know. My feeling is
Speaker 1: they weren't sure what their position was, but they wanted
Speaker 1: to slow it down in the meantime, and they didn't
Speaker 1: do that in a very transparent way. The new administration,
Speaker 1: you know, clearly is wanting to make you know, the
Speaker 1: US the capital for crypto and and make sure that
Speaker 1: we're not missing a beat when it comes to innovation
Speaker 1: in general and with respect to crypto, and I think
Speaker 1: that's very, very positive. So even today where we're enjoying
Speaker 1: some some really renewed interests and adoption, there's still a
Speaker 1: lot of people who have been on the sidelines, both
Speaker 1: individuals and institutions, waiting for a moment where they could
Speaker 1: get involved without feeling like a regulator might have a
Speaker 1: gun to their head and and them not really know
Speaker 1: about it.
Speaker 2: Yeah. Absolutely, And it's amazing the things that are on
Speaker 2: the table even with the government right a stable coin legislation,
Speaker 2: market structure legislation, and then you have the bitcoin reserve bill,
Speaker 2: states individually are introducing bitcoin reserve bills. And then you
Speaker 2: also have the ELON talking about putting government spending on
Speaker 2: the blockchain, which I think, regardless of what where you
Speaker 2: stand politically, you should know where your tax dollars are
Speaker 2: being how they're being used, and how it's been spent. Right,
Speaker 2: So it'll be amazing to see these things come to
Speaker 2: fruition this year.
Speaker 1: Yeah, No, I mean, it's it is again quite amazing
Speaker 1: a strategic bitcoin reserve. I mean, just you know that
Speaker 1: that level of recognition and that level of relying on
Speaker 1: this asset, you know, is uh is just incredibly important
Speaker 1: and also you know, makes a lot of sense. It
Speaker 1: just makes a lot of sense, you know. I'm certainly
Speaker 1: I've never worked in the Treasury. I'm not you know,
Speaker 1: take everything I say with a great assault as it
Speaker 1: recome as as it relates to treasury and Treasury policy.
Speaker 1: But you know, I think diversification is a good idea
Speaker 1: in general when you're trying to manage a portfolio or
Speaker 1: manage a bunch of money. So so I think there's
Speaker 1: a lot of a lot of merit to the idea.
Speaker 2: M Yeah, I know there's talks of, yes, the bigcoin reserve,
Speaker 2: but also a digital stockpile. I don't know that will
Speaker 2: actually come to fruition, but it were, it would include
Speaker 2: other digital assets as well. So we'll see what Trump
Speaker 2: and the administration decide to do.
Speaker 1: I inc I'm sorry, I mean interrupt Tony, but instantly,
Speaker 1: I don't think that's the most important thing, you know,
Speaker 1: I think it's great that the administration is focused on
Speaker 1: that and I think there's benefits to be had, but
Speaker 1: I do think the regulatory issue has got to be solved,
Speaker 1: and it's got to be solved quickly. And I believe,
Speaker 1: I don't know, but I believe that's going to require
Speaker 1: congressional action. You know. My take on the situation in
Speaker 1: the US is a we are behind so in Europe
Speaker 1: and bitstamp is a very global business. So our business
Speaker 1: in Europe in many respects is thriving because of a
Speaker 1: different level of regulatory clarity with the MICA framework and
Speaker 1: other things. So it hasn't enabled institutions and banks in
Speaker 1: particular to get involved in a way that is not
Speaker 1: currently possible in the US, just as one example. So
Speaker 1: I believe that Congress needs to act. They need there
Speaker 1: needs to be a framework that, for instance, you know,
Speaker 1: defines the jurisdictions here between CFTC and SEC and how
Speaker 1: that all fits together with crypto because it doesn't fit
Speaker 1: neatly into you know, traditional structures there. And then those
Speaker 1: regulators need to create, you know, create rules and do
Speaker 1: it transparently, not not by enforcement where we're all trying
Speaker 1: to guess what, you know, what the rules are. So
Speaker 1: that that I hope UH, the administration prioritizes and and
Speaker 1: and becomes an initial focus.
Speaker 2: Yeah. Absolutely, one hundred percent. That is the thing a
Speaker 2: lot of people are waiting for in the market's waiting for, uh,
Speaker 2: because there's still some wild West activities happening in the
Speaker 2: crypto space. We need the regulations and UH that protects consumers,
Speaker 2: but also the fosters innovation. Let's talk about bitstamp for
Speaker 2: those who may not know, tell us about big Stamp
Speaker 2: and the different services you guys offer.
Speaker 1: Sure, sure, thanks, so, as I mentioned, bistamps the longest
Speaker 1: running crypto exchange. Are quite proud of our track record
Speaker 1: in that regard. We do serve to starting at the
Speaker 1: highest level. We do serve retail investors. We've got you know,
Speaker 1: five million or so retail customers. We also serve in institutions,
Speaker 1: and we have a growing and really strong, uh you know,
Speaker 1: cohort of institutional clients. And we believe that that diversity
Speaker 1: makes our markets really healthy and really and really reliable.
Speaker 1: And bit stamp, you know, our claim to fame is
Speaker 1: generally that we believe we have the the most extensive
Speaker 1: regulatory licensing footprint in the business, and that we have
Speaker 1: always prioritized regulatory compliance and you know, professional governance as
Speaker 1: a company, even at the expense of growth, probably in
Speaker 1: the early years. And that was you know, going back
Speaker 1: to our founders and I wasn't there at bitstamp at
Speaker 1: the time, but my my belief and based on my
Speaker 1: conversation is with them, you know, they anticipated this moment.
Speaker 1: You know, they anticipated a time when mainstream adoption will
Speaker 1: happen and specifically institutions will get involved, you know, in
Speaker 1: more of a complete way. And so they back in
Speaker 1: twenty fifteen twenty sixteen, started making decisions to prepare bitstamp
Speaker 1: to be an obvious choice, particularly for institutions. So what
Speaker 1: did they do. You know, they they firstly separated custody
Speaker 1: from the exchange, so we out we had we had
Speaker 1: that technology, we outsourced it to a licensed custodian bid Go.
Speaker 1: Why because the institutions generally get worried about that counterparty
Speaker 1: risk when when those two things are together. The next
Speaker 1: thing they did was they got a license. So we
Speaker 1: were the first to ever get a license, which was
Speaker 1: which was in Luxembourg, and that's started us down the path.
Speaker 1: We have sixty plus licenses around the world today and
Speaker 1: the third thing they did was, which I thought must
Speaker 1: have been quite radical at the time, is you know,
Speaker 1: they made the decision in twenty sixteen to start getting
Speaker 1: global financial audits from a big four accounting firm. And
Speaker 1: you know, I'm pretty sure in twenty sixteen there weren't
Speaker 1: many crypto companies thinking about global financial audits. And because
Speaker 1: of that, you know, we're the only ones who can
Speaker 1: say we have eight years of cleaning audit opinions from
Speaker 1: a Big four accounting firm, and that has defined bitstamped
Speaker 1: to a pretty great degree. We just do things right.
Speaker 1: You know, we don't mess around. We want to make
Speaker 1: the confidence that our customers have in us kind of
Speaker 1: beyond approach.
Speaker 2: That's great. I love that, you know, going back to
Speaker 2: twenty sixteen, you guys are doing these audits and if
Speaker 2: only the industry had that standard or you know, more exchange,
Speaker 2: we wouldn't have FTX and all this madness that took place.
Speaker 2: And then I love that you guys outsource your custody
Speaker 2: to like a trust custodian like bitgo. That's really great.
Speaker 2: So they'll com mingling and once again FTX is the example.
Speaker 1: Yeah, Yeah, I couldn't agree more obviously, And the only
Speaker 1: other thing I would add about Bitstamp is, as I
Speaker 1: started to mention, where we're truly global, so you know,
Speaker 1: our heritages in Europe. We were founded in Europe. Europe
Speaker 1: is still sixty five percent of our total business, but
Speaker 1: we have a strong and growing business in the US
Speaker 1: and in the Americas and also in Asia.
Speaker 2: Now, there was news last year I believe that robin
Speaker 2: Hood had acquired bitstamp. Tell us about that acquisition and
Speaker 2: how you'll be working together.
Speaker 1: Yeah, we're really excited about this, and I can't comment
Speaker 1: much about it because it's a transaction in progress. But
Speaker 1: what I can say is what we said publicly, we
Speaker 1: when we announce the acquisition that we it will take
Speaker 1: some time to get through regulatory approvals. I mentioned, we've
Speaker 1: got a lot of licenses. That's all progressing very very well.
Speaker 1: We said when we when we announced that we expect
Speaker 1: to be done with that that process, the regulatory approvals
Speaker 1: and realize the change of control in June of twenty
Speaker 1: twenty five. And we we are on track for that timeline. Still,
Speaker 1: it's of course difficult to predict with precision because regulators,
Speaker 1: you know, kind of operate on their own timelines, but
Speaker 1: everything is progressing very very well. We're quite excited about it.
Speaker 1: That the combination is very complementary. Right, So you know,
Speaker 1: they're they're one retail focused today and as I mentioned,
Speaker 1: we have a really strong growing institutional business. They're primarily
Speaker 1: us UH in terms of their current customer base, and
Speaker 1: and we're we're more skewed towards Europe. So these things
Speaker 1: will I think create a really powerful combination.
Speaker 2: Oh for sure. And in Bitstamp, As far as services
Speaker 2: you offer, I'm I'm assuming you include the top crypto assets.
Speaker 2: Uh do you offer staking? I'm assuming spot trading, futures
Speaker 2: trading and things like that.
Speaker 1: Yeah, great question. So we were primarily a spot exchange today,
Speaker 1: although we do have a derivatives offering coming soon which
Speaker 1: I can which I can mention although we haven't we
Speaker 1: haven't promoted yet, and we we do have a global
Speaker 1: set of Spot offerings that support our Spot exchange. What
Speaker 1: what we believe about the derivative side of the market
Speaker 1: place is, as I mentioned earlier, you know, it dwarfs
Speaker 1: the spot side of the crypto marketplace in terms of
Speaker 1: overall volume and market cap, if you will, and it's
Speaker 1: growing faster for all the right reasons. It's because these
Speaker 1: as an asset class, crypto is maturing. However, the vast
Speaker 1: majority of that volume is on venues that I would
Speaker 1: characterize as offshore, you know, offshore or in lightly regulated jurisdictions,
Speaker 1: And that's of great concern to me as somebody who's
Speaker 1: been in the industry for a while and believes so
Speaker 1: deeply in what we're doing. I like, where have I
Speaker 1: heard of this before where a venue becomes large and
Speaker 1: is in a lightly regulated jurisdiction. Oh, I remember is FTX.
Speaker 1: So so you know, I think I think the industry
Speaker 1: really needs to step back and think, so we don't repeat,
Speaker 1: you know, repeat history here. So so ninety five percent
Speaker 1: of a giant, you know, derivatives market is too much
Speaker 1: to be in those venues that might have been okay
Speaker 1: five years ago, but in twenty twenty five and going forward,
Speaker 1: it just can't be so bitstamp. You know, Given everything
Speaker 1: I said about our regulatory posture, we think we can
Speaker 1: bring a solution to that, and I think others can
Speaker 1: and need to as well, so that traders and investors
Speaker 1: have alternatives that are liquid that you know, are not
Speaker 1: in some jurisdiction that might not be as rigorous or
Speaker 1: as trustworthy as others.
Speaker 2: Yeah, great point, because I still see like these some
Speaker 2: like new derivatives platform or exchanges pop up and they're
Speaker 2: like no KYC and all these things, and I'm like,
Speaker 2: that's probably not gonna last very long with the regulations
Speaker 2: coming into place. Like to your point, like five six
Speaker 2: years ago, you know, it was a young market. Now
Speaker 2: I don't think that's gonna fly. So, yeah, we want
Speaker 2: to have regulated institutions and things buttoned up, guardrails in
Speaker 2: place and much more.
Speaker 1: Yeah, for sure.
Speaker 2: Now, I would love to get your thoughts on your
Speaker 2: future outlook for crypto exchanges and platforms like bitstamp. And
Speaker 2: in the context of look, there's ETFs being launched, there's
Speaker 2: platforms like robin Hood, there's PayPal and so forth. How
Speaker 2: how would bitstamp separate itself from these companies? You know,
Speaker 2: what are some of the things you guys plan to
Speaker 2: offer and maybe eventually tokenize assets, Right, We're going to
Speaker 2: tokenize stocks and commodities, and maybe bitstamp will offer stuff
Speaker 2: like that.
Speaker 1: Yeah, absolutely, So you know, there's a couple of ways
Speaker 1: to think about about what's happening here from a from
Speaker 1: a purely exchange standpoint, you know, and this is a
Speaker 1: gross oversimplification, but you know, what are we what are
Speaker 1: we good at? And what are exchanges good at? They're
Speaker 1: good at matching buyers and sellers right and doing it
Speaker 1: transparently and and doing it you know, incredibly efficiently. And
Speaker 1: and so it doesn't have to be a single commodity
Speaker 1: or type of commodity or asset that that is in
Speaker 1: play for for an exchange. So what does that mean?
Speaker 1: That means exchanges, you know, should think about diversifying into
Speaker 1: for instance, you mentioned tokenized securities or tokenized assets of
Speaker 1: other of other types that would be a natural growth that.
Speaker 1: That is something we are focused on where we have
Speaker 1: a strategy there and a set of initiatives that you know,
Speaker 1: we'll be able to communicate more about in second half
Speaker 1: of this year. But something we're very very excited about,
Speaker 1: as everybody is the possibilities associated with tokenization in general
Speaker 1: are just immense. You can do so many things, and
Speaker 1: there's so many types of assets that lots of you know,
Speaker 1: retail investors or buyers and sellers don't have access to today.
Speaker 1: But with a tokenization you know process, then that could
Speaker 1: really democratize a lot of market a lot of markets,
Speaker 1: which I think is quite exciting. So yeah, tokenization is
Speaker 1: really important. You also mentioned a minute ago staking and
Speaker 1: some of the yield bearing products and services those I
Speaker 1: think are really important for exchanges and also something that
Speaker 1: we offer in select geographies. In Europe, for instance, we
Speaker 1: have a lending offering where our customers can can choose
Speaker 1: to lend their crypto for yield, and we do that
Speaker 1: via a partner. But uh, the point the point of
Speaker 1: that is we we do it quite transparently and differently
Speaker 1: than it had been done in the past. We do
Speaker 1: it in the big stamp way, if you will, and
Speaker 1: then the other way to think about the future. I
Speaker 1: think you mentioned robin Hood and cash app and some
Speaker 1: of these guys. You know, there's there's a lot of
Speaker 1: banks out here, also banks globally and in the US
Speaker 1: that have you know, tremendous amount of loyal customers that
Speaker 1: really trust them. But I think they're finding themselves in
Speaker 1: a situation where they're depositors, their customers have to leave
Speaker 1: their ecosystem to buy bitcoin, you know, or to use
Speaker 1: a stable coin to transact somewhere, and they're getting increasingly
Speaker 1: concerned about that, and I would too if I were them, right, So,
Speaker 1: so I think there needs to be a or there
Speaker 1: will be a convergence, you know of either led by
Speaker 1: banks or led by fintech companies, great fintech or payments
Speaker 1: companies where they bring a lot of these banking and
Speaker 1: financial services capabilities together in one app, you know. And
Speaker 1: and from an exchange perspective, we would love to support that.
Speaker 1: It doesn't have to be us at the at the
Speaker 1: front end. We can be the liquidity liquidity at the
Speaker 1: back end. But I do think that phenomenon is happening,
Speaker 1: and I do think exchanges diversifying into different asset classes
Speaker 1: is happening.
Speaker 2: Yeah, for sure. And that's a great point of mentioning
Speaker 2: that you could power to back end. Right, So it's
Speaker 2: a bank and they don't want to build all these
Speaker 2: things out. They just go to you guys, plug you
Speaker 2: in and they can offer the customer's script. But you're
Speaker 2: you're you know, powering to back end.
Speaker 1: Yeah, exactly, in fact, and that all we haven't We
Speaker 1: have that ofurn called we call it big Stamp as
Speaker 1: a service. And in Europe I alluded to this earlier
Speaker 1: in Europe. We have a lot of a growing business here,
Speaker 1: particularly in the banking sector, because they're not going to
Speaker 1: build it at this point, right, so they're going to
Speaker 1: need to rely on somebody who has the full regulatory
Speaker 1: stack like like we do, and the full technology stack,
Speaker 1: and and just plug it in so that their customers
Speaker 1: don't have to leave in order to buy a few
Speaker 1: dollars a big coin.
Speaker 2: Yeah, great point. What's on your roadmap for this year?
Speaker 1: Oh well, we're very excited about addressing this derivative situation
Speaker 1: I mentioned. And again, like I said, we haven't announced
Speaker 1: this yet, but suffice it to say that, you know,
Speaker 1: outside of the US, a little bit different equation in
Speaker 1: the US, but outside of the US, you know, and
Speaker 1: specifically in Europe, you know, we have the licenses, specifically
Speaker 1: a miffed license that would enable us to offer derivatives
Speaker 1: and particularly perpetual swaps in our fully regulated, fully regulated fashion,
Speaker 1: in a trustworthy jurisdiction. And beyond that securities or token
Speaker 1: is securities or what have you. So, so in the
Speaker 1: bitstamp way, we've we've gotten our licensing foundation in place
Speaker 1: so that now we can build offerings that you know,
Speaker 1: provide a really safe and sound regulated alternative to what's
Speaker 1: in the market today. So that's a primary focus for us.
Speaker 1: In addition to that, as I mentioned, we're in the
Speaker 1: US looking to get back into the art and science
Speaker 1: and ball game of growth. So for the last couple
Speaker 1: of years, when the regulatory environment has been so uncertain,
Speaker 1: like many we kind of we continue to grow our business,
Speaker 1: but you know, maybe in a more quiet way then
Speaker 1: would be typical, and we also true true form for
Speaker 1: a bitstand we're also quite conservative in terms of our
Speaker 1: token listings and our offerings. So for instance, when the
Speaker 1: SEC brought actions against some of our competitors and they
Speaker 1: named certain tokens, you know, we automatically trade halted those tokens,
Speaker 1: even if we could not understand why the SEC picked them,
Speaker 1: even if we had you know, legal opinions saying that
Speaker 1: it was okay, we just took a very conservative posture.
Speaker 1: Same thing with Staking in the US, the reactions brought
Speaker 1: about Staking offerings. We think our Staking offering is different,
Speaker 1: but we paused it. So now in twenty twenty five,
Speaker 1: we want to get back into the business, albeit in
Speaker 1: a disciplined and thorough way, to revisit those tokens and
Speaker 1: also new tokens that have come out in the meantime,
Speaker 1: and also staking products.
Speaker 2: That's great, and I understand. I actually worked at a
Speaker 2: small crypto exchange in the United States which had to
Speaker 2: close its door because it didn't want to deal with
Speaker 2: things like like as you mentioned, right, Wells notices and
Speaker 2: get into massive lawsuits. So it feels like the dark
Speaker 2: cloud has been lifted companies to help and get back
Speaker 2: to focusing on growth, building great products.
Speaker 1: And much more. Exactly exactly, yeah, the way everyone said
Speaker 1: this a million times, but you know, the way the
Speaker 1: SEC was operating it really made it quite uncomfortable. Even
Speaker 1: for a company like bitstand like, we just want to
Speaker 1: do it right. Just tell us what's right, we'll do it,
Speaker 1: you know, I mean, no questions asked. We know how
Speaker 1: to deliver compliant processes, but it was never quite clear
Speaker 1: what was right, and the only way that the SEC
Speaker 1: seem to want to address the issue was via enforcement.
Speaker 1: And you know, if they bring an action, if they
Speaker 1: bringe Wells notice and or a law suit, you know,
Speaker 1: it's crippling for a business. It's crippling. You know, it
Speaker 1: costs millions upon millions and millions of dollars just to
Speaker 1: defend yourself even if you're one hundred percent correct and
Speaker 1: above board. So it's you know that to your point,
Speaker 1: it's good that we seem to be it's not done yet,
Speaker 1: we seem to be moving beyond it.
Speaker 2: Yeah. Absolutely, I love like your thoughts on the Bitcoin
Speaker 2: ETF and etheromytfs. Obviously, Bitcoin ETF a massive success, the
Speaker 2: fastest growing ETFs in the history of the ETF market.
Speaker 2: I blew out records out of the water. What are
Speaker 2: your thoughts, And then there's talks of getting x RP
Speaker 2: and Solana ETFs other old coins this year.
Speaker 1: Well, it's just, uh, the phenomenon of the Bitcoin ETF
Speaker 1: just can't be underestimated in terms of legitimizing the entire
Speaker 1: idea for lots and lots of people and institutions. So
Speaker 1: so so that's great and from a from a bitstand perspective,
Speaker 1: you know, to us, that's a that is growing the pi,
Speaker 1: you know, literally growing the pie. It's creating an avenue
Speaker 1: for individuals and institutions that are comfortable with it. They
Speaker 1: know how to deal with ETFs, they know what an
Speaker 1: ETF means. They have those access points, you know, well
Speaker 1: paved and and therefore they join a marketplace that they
Speaker 1: otherwise you know, wouldn't it wouldn't take the time to
Speaker 1: find the access points. So so similarly with Solana and XRP,
Speaker 1: which I think are both you know, going to come,
Speaker 1: I don't know on what timeline, but it's just gonna
Speaker 1: do the same thing. It's going to open up new possibilities.
Speaker 1: You know, both of those assets have a story, you know,
Speaker 1: they have they have an ecosystem, there's an awful lot happening,
Speaker 1: and you know, participating in that side of the crypto
Speaker 1: marketplace is a little bit different than Bitcoin because of
Speaker 1: what's what's being built within those ecosystems, and so so
Speaker 1: I'm excited that more classes of investors are going to
Speaker 1: get smarter and get more grounded in what is you know,
Speaker 1: cutting edge across the across the crypto the cryptosphere if
Speaker 1: you will, m hm.
Speaker 2: And also your thoughts on the stable coin market, which
Speaker 2: has been booming. You have a lot of new folks
Speaker 2: issuing stable coins, even like Ripple they just launched a stablecoin.
Speaker 2: PayPal has a version. I know the folks at robin
Speaker 2: Hood is working on a conglomerate stable coin. I remember
Speaker 2: speaking to I think it's Johann kerbat at Robin Hood.
Speaker 2: Uh yeah, just so it seems a stable coin market
Speaker 2: is heating up. There's many layers today because uh, if
Speaker 2: the United States does it very well or right, Uh,
Speaker 2: it can help maintain the world reserve currency status of
Speaker 2: the US dollar and uh and a political aspect all
Speaker 2: of that.
Speaker 1: Of course, yeah, of course, and you are you are
Speaker 1: correct or we're we're seeing the same thing. Just there's
Speaker 1: there's a bit of a proliferation of new stable coin projects,
Speaker 1: and you know, they all have slightly different con you know,
Speaker 1: context or or or strategy behind them, but they all
Speaker 1: carry a lot of possibilities associated with them. So what
Speaker 1: I mean specifically is, for instance, some of them are
Speaker 1: are more geared towards sharing rewards with infrastructure providers. So bitco,
Speaker 1: for instance, bitco is launching a stateable coin, and part
Speaker 1: of their concept, as I understand it, is you know
Speaker 1: the yield, so you know, the underlying assets supporting these
Speaker 1: stable coins generating an incredible amount of yield. If you
Speaker 1: look at at Circle and if you could look at toether,
Speaker 1: you would see just a lot of zeros, like just
Speaker 1: enormous businesses built around this yield, but they don't share
Speaker 1: a lot of that yield some of these new projects.
Speaker 1: That's their whole concept is like, actually, we want to
Speaker 1: reward the infrastructure that is, you know, providing access to
Speaker 1: use of the stable coin. And then at the same time,
Speaker 1: like the killer app side of stable coins just keeps
Speaker 1: getting more and more pronounced. You know, the ability to
Speaker 1: just move dollars or euros, you know, seamlessly and without cost,
Speaker 1: you know, across a network or across an ecosystem is
Speaker 1: is never going to go out of style. You know,
Speaker 1: there's still there's still you know, Western Union and other
Speaker 1: other places that charge an incredible amount to move money
Speaker 1: and it takes a couple of days. You know. It's
Speaker 1: it's that's ripe for ripe for innovation, let's.
Speaker 2: Say, yeah for sure. Uh And and to your point,
Speaker 2: like stable coin seem to be the killer use case
Speaker 2: of blockchain. Obviously there's going to be more, you know,
Speaker 2: with tokenization and stuff like that, but stable coin being
Speaker 2: the first, and it's incredible, I feel like we can
Speaker 2: hit if we haven't, we're close to it as yet,
Speaker 2: maybe a trillion doullar market cap for stable coins probably
Speaker 2: by the end of the year. Next year, we'll see,
Speaker 2: but things are heating up.
Speaker 1: I think it's I think it's possible. And I think
Speaker 1: what's interesting is how many different There's two things are
Speaker 1: interesting to me. One is how many different stable cooin
Speaker 1: projects will get traction. I don't think it's going to
Speaker 1: be just one, but I don't think it's going to
Speaker 1: be one hundred either. And then also currencies, so you know,
Speaker 1: the U s D stablecore market is by far the
Speaker 1: the one that has gotten traction. But I'm curious to
Speaker 1: see if if Euro stable coins, of which there are
Speaker 1: some really quality projects out there, will will get traction,
Speaker 1: or are Brazilian reale or or some other important FIAT currencies.
Speaker 1: And you mentioned the political side of this, which is
Speaker 1: interesting too. You know, I I am a firm believer
Speaker 1: in what you said, which is, you know, the US
Speaker 1: dollar enjoys a rarefied space in the global financial ecosystem.
Speaker 1: And uh and and if and if we the US,
Speaker 1: you know, for instance, stifle crypto or do not support
Speaker 1: U s D stable coins, then it will be I
Speaker 1: think negatively affected. Over time, it will erode. So healthy
Speaker 1: USD stable coins will I think support you know, the
Speaker 1: US dollar as a global currency and a global reserve currency,
Speaker 1: and so I'm glad to see the administration's posture on this,
Speaker 1: for instance, versus a you know, a central bank stable coin,
Speaker 1: which I think would would disrupt that possibility.
Speaker 2: Yeah, to your point, it seems like the CBDC movement
Speaker 2: has kind of died down and the governments are leaning
Speaker 2: more towards private sector stable coins. But we'll see. You know,
Speaker 2: maybe some other countries may still move forward with CBDCs,
Speaker 2: but at least here in the United States, that is,
Speaker 2: it seems like it's dead on arrival.
Speaker 1: Yeah, I believe so. I hope so, because I just
Speaker 1: I think both in terms of, you know, your economics,
Speaker 1: it's better, but I also think the privacy aspect is
Speaker 1: really really important too. But in China it's all CBDC,
Speaker 1: you know, that's that's the marketplace there.
Speaker 2: So so yall, Yeah, for sure. Now I hope you
Speaker 2: do to mind be asking you about this, But you know,
Speaker 2: meme coins have been going crazy. It's it's madness, right,
Speaker 2: It's a well while West look there, I want to
Speaker 2: make sure I preface this question. There are certain meme
Speaker 2: coins like doge Coin, which I've been around for a
Speaker 2: long time, you're not going to get rugged pulled by
Speaker 2: doge coins. You know, it's not. It wasn't created last
Speaker 2: week or last night on pump fun, right, But there's
Speaker 2: a lot being created. The president launches own and a
Speaker 2: lot of people are getting hurt and rugged. You know,
Speaker 2: how does bitstamp look at these things? And and even
Speaker 2: if there are some quality meme coins like your doge
Speaker 2: coins that you're playing to listen, how do you guys
Speaker 2: approach it.
Speaker 1: Yeah, it's a great question, and it's you know, it's
Speaker 1: something that is impossible to ignore. To your point, it's
Speaker 1: you know, there's just a lot, there's a lot of
Speaker 1: projects that are getting real traction and so and to
Speaker 1: your point, the longest, the longest we're running ones that
Speaker 1: you like Doje and Pepe. You know, these are generally
Speaker 1: I think more trusted and they're too big now to
Speaker 1: be like some pumping them you know scheme, which which
Speaker 1: is great, I think from a bitstand perspective. You know,
Speaker 1: for tokens in general, we're very choosy. You know, we
Speaker 1: we have a very rigorous process where we look at
Speaker 1: these projects, not just from a regulatory perspective, although that's
Speaker 1: very important, but also from a technology perspective, from a
Speaker 1: you know, a usability or a commercial perspective, a security
Speaker 1: you know, information security kind of perspective. We try to
Speaker 1: look out for our customers, so so when we list something,
Speaker 1: you know, it kind of has our seal of approval.
Speaker 1: We're not the kind of exchange that just throws stuff up.
Speaker 1: See what happens now mean cooin. You know, it's more
Speaker 1: challenging to understand the purpose, right to be blunt. However,
Speaker 1: to your point, some of them have real communities behind it,
Speaker 1: like Doge. Like Doge has a very vocal, loyal, growing
Speaker 1: community around it. So in that regard as an exchange operator,
Speaker 1: you know, we have to make it available. We've got
Speaker 1: to make it available to you know, to customers and
Speaker 1: they use it to move value around, and you know,
Speaker 1: perhaps there's a set of possibilities being built on it,
Speaker 1: you know, over time. But we're we won't be the
Speaker 1: first to list any any new mean coin for all
Speaker 1: the reasons you alluded to, Like I think there is
Speaker 1: a real speculative side of this proliferation of meme coins,
Speaker 1: and we don't want to really be a party to that,
Speaker 1: even if there's money to be made Frankly, that's not
Speaker 1: why we're in crypto. That's not what we stand for.
Speaker 1: A bit stamp. I don't mind that those are out there,
Speaker 1: but that's not really kind of our you know, kind
Speaker 1: of our focus.
Speaker 2: Yeah, absolutely, I think, yeah, there's there's some clean up
Speaker 2: that needs to happen here. I don't know how they
Speaker 2: get to regulated, but you know, I believe in the
Speaker 2: free market. Like, if you want to invest in it,
Speaker 2: go ahead, just know the risk. But I guess the
Speaker 2: part of being able to rug people, right, the RUG
Speaker 2: polls are what hurts a lot of the meme coin market,
Speaker 2: and it kind of puts a bad reputation because of
Speaker 2: course the mainstream headlines, oh, this guy, you know, Hoavier Malay,
Speaker 2: president of Argentina, creates a mean coin of rug pulls
Speaker 2: people for eighty seven million. That doesn't reflect well in
Speaker 2: the market. So we have to figure out some sort
Speaker 2: of balance.
Speaker 1: Yeah, it's not good. Yeah. And yeah, when it gets
Speaker 1: like wreckly integrated with politics, either in our country or
Speaker 1: other countries, I think it really also gets complicated because
Speaker 1: you know, buying the token can can be viewed I
Speaker 1: think as you know, trying to create influence, and that's
Speaker 1: obviously should be very separate.
Speaker 2: Yeah, absolutely, Bobby. I got some wrap up questions here
Speaker 2: for you. First, if you could create your own metaverse,
Speaker 2: what would the theme be?
Speaker 1: Yeah, yeah, yeah, let me let me go. You know,
Speaker 1: this might sound corny, but one of the things that
Speaker 1: intrigues me about the metaverse or meta meta versus in
Speaker 1: general is like, you know, utopian ideas. So so I
Speaker 1: think it would be diversity, you know, I believe it
Speaker 1: or not. Like, uh, you know, if that was the
Speaker 1: thematic headline and all the people that grab potated towards
Speaker 1: that metaverse had that in mind, you know, I wonder
Speaker 1: if it would create new possibilities.
Speaker 2: Oh sure, rapid fire questions. Favorite food.
Speaker 1: Food mm hm god, you know pizza.
Speaker 2: Your musician or band.
Speaker 1: Oh that's a really really hard one for me. I
Speaker 1: I'm also a musician. I play in bands, so it's
Speaker 1: a really tough one. I'll tell you one of my favorites.
Speaker 1: I'll discussed the.
Speaker 2: Nice favorite movie.
Speaker 1: Man. I'm gonna sound like like a stereotype, but my godfather,
Speaker 1: it's classic. Favorite book, favorite book, here's your room, my reputation.
Speaker 1: My favorite book is actually, uh, this very very old
Speaker 1: book of poems by E. Cummings mm hmm.
Speaker 2: And when you're not working a bit stamp, what are
Speaker 2: you doing for fun as a hobby?
Speaker 1: So, as I mentioned I I I play guitar and
Speaker 1: I play in bands, write songs. That's that's uh, both
Speaker 1: for sanity reasons and and and to keep the other
Speaker 1: side of my brain working, so that takes takes a
Speaker 1: lot of time, something I truly love. I also do triathlons,
Speaker 1: which keeps me moving. Uh. And then yeah, my family.
Speaker 1: I've got a great family. I've been very fortunate and
Speaker 1: blessed in that regard. So those those things come to mind.
Speaker 2: Nice. Uh. Follow up question the guitars, because I play guitar.
Speaker 2: You can't see it, but I have a less Paul,
Speaker 2: I have a friender Stratton to back there acoustic. What
Speaker 2: is your favorite guitar to play?
Speaker 1: Well, my favorite guitar is A is a sixty eight
Speaker 1: Gibson Dove that I that I have in Chicago. It's
Speaker 1: an acoustic obviously. My electric is A is a telecaster. Uh.
Speaker 1: And uh yeah those are those are my babies.
Speaker 2: I want to get one more baby, but my wife
Speaker 2: would probably kill me. Uh, gretch white Falcon. I want
Speaker 2: to want to get.
Speaker 1: Oh, I also want to gretch.
Speaker 2: I do, yeah, my wife. My wife's already complained by
Speaker 2: I'm piling up guitars here, you know.
Speaker 1: Uh.
Speaker 2: Bobby, great chatting with you. Love what bitstamp is doing.
Speaker 2: I would love to have you back on in the
Speaker 2: future as things unfold for bitstamp, especially with the integration
Speaker 2: with Robin Hood and much more. Well, thank you for
Speaker 2: joining me.
Speaker 1: Oh, thank you, Tony. He's really really a blast and
Speaker 1: anytime