Fastest Growing Crypto CEO Predicts A Market Collapse | DSH #2032

Summary

Digital Social Hour, Episode #2032

Title: Fastest Growing Crypto CEO Predicts A Market Collapse
Air Date: June 24, 2026
Host: Sean Kelly
Guest: Jake (CEO of the fastest-growing crypto RIA, Ripple-focused investor, digital wealth manager)
Episode Theme: An unfiltered, comprehensive exploration of the current state and future of the cryptocurrency market—especially XRP (Ripple)—the predicted correction in global markets, the role of banks and institutions in crypto, stablecoins, AI’s impact on finances, and the macroeconomic factors that may trigger a historic market collapse.

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Episode Overview

This episode centers on high-level insights into crypto’s intersection with traditional finance, macroeconomic instability, and technological innovation. Jake, a prominent figure in the crypto space, unpacks the trajectory of XRP, the evolving regulatory environment, and anticipates a major correction in the global stock market, all while emphasizing the new roles for blockchain and AI. The conversation is equal parts cautionary and optimistic, offering a rare behind-the-curtain look at institutional movements, government actions, and the personal journey of a crypto-focused wealth manager.

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Key Discussion Points & Insights

1. Market Correction Prediction & Macro Outlook

Jake boldly predicts a substantial downturn in equity markets and shares his thesis on systemic risk.

• "There's going to be a correction. I think we're going to see somewhere between 30 and 50% down on the stock market this year." [00:00, 22:11]
• The “reverse carry trade” (borrowing yen at low/zero rates, investing globally) will unwind rapidly as Japan is forced to raise rates after supply shocks (Hormuz shutdown affecting oil).
• Between $10T–$14T is currently leveraged on this trade; its unwinding could spark a global liquidity crisis affecting stocks, crypto, and more. [23:30, 27:34]

“The S&P was down 13% in a single day [in August 2024]… There's never been this much leverage at scale that's been deployed globally...” – Jake [22:45, 27:09]

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2. XRP & Ripple: Utility, Adoption, and Institutional Use Cases

A deep dive on why Jake is “all in” on XRP and sees it as the backbone of future financial settlements.

• Ripple/XRP’s origin: started June 2, 2012, among first crypto assets. [01:19]
• Jake was an early ETH/Chainlink/Cardano investor but pivoted to be 100% in XRP from mid-2022.
• XRP’s "banker coin" label is accurate; Jake forecasts it will become the “primary settlement layer” for cross-border payments and collateral in global markets. [04:14]
• Banks aren’t yet actively using XRP at scale—liquidity isn’t high enough. Jake believes XRP must reach $50-$100/token to serve this role. [05:42]
• R3, a blockchain infrastructure provider, uses XRP for settlements in its Corda network after an extensive lawsuit/settlement.
• Banks trialed XRP (e.g., with MoneyGram, Bank of America), but mass adoption hinges on increased liquidity and market depth. [06:08, 06:34]
• XRP is being wrapped for DeFi (via Solana, Flare). If it achieves “tier-1” asset status, much of its supply would be locked up as premium collateral, especially in derivatives markets (potentially up to $4 quadrillion size). [07:38, 08:08]
• Current market cap: $130B–$140B; needs to be much higher for institutional use.
• Ripple’s “full stack” (Ripple1) offers custody, prime brokerage, and credit—XRP is accepted as collateral in these services.

“I believe it’s what will end up settling the back end of the stock market, the FX market, commodities… eventually being labeled a tier one asset by the BIS.” – Jake [04:14]

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3. Stablecoins, Tether’s Risk, and Institutional Preferences

Stability concerns around the crypto ecosystem’s reliance on specific stablecoins.

• Major stablecoins: Tether (USDT), USDC, Paxos. Jake is wary of USDT due to regulatory and audit uncertainties; prefers USDC, Paxos, and ROUSD—cited as “institutional-friendly.” [09:52, 10:14]

“I don’t know what’s going to happen to Tether USDT over the long term. … For them to launch USAT here, that’s a compliant stablecoin. Why would you do that… if you were going to get USDT to be compliant?” – Jake [09:10, 09:51]

• If Tether depegs or is frozen, it would cause a massive liquidity crunch in crypto markets, affecting trade sizes and stability. [10:14]
• Large trades are easier with USDT than with “safer” stablecoins.
• Tether has never been fully audited; MasterCard and Visa avoid it for this reason. [37:23, 37:48]

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4. Institutional Crypto Wealth Management & Client Demographics

An inside look at the shift from cypherpunk roots to institutionalization, risk management, and family legacy planning.

• Jake’s firm managed $0 to $1B in a year, making it the fastest-growing RIA (Registered Investment Advisor) in the world. [15:18]
• Most clients are 45–70, early crypto adopters with significant digital wealth but little technical know-how.
• Services offered: institutional multisig custody (insured up to $100M at Anchorage), legacy/estate planning, ability to collateralize crypto holdings for loans and real-world purchases. [16:17]
• “We’re the Schwab of crypto.” – Jake [17:12]
• Friction in self-custody (“worst anxiety I ever get”) and Cold Wallet horror stories drive clients to managed solutions. [17:30, 17:45]

“If you’ve got it on a cold wallet and your spouse has no clue about this stuff… we provide a multisig inside of institutional custody at Anchorage” – Jake [15:43, 16:17]

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5. Blockchain Scalability, Settlement, and Tokenized Markets

Forecasts for financial infrastructure upgrades and ripple effects on finance.

• XRP transaction speed: 2–3 seconds, faster than Ethereum.
• XRP network can process up to 1,500–15,000 transactions per second (TPS); further patents could allow infinite scaling, aiming to rival Visa/MasterCard’s 30,000 TPS. [18:05, 18:18, 31:12]
• The stock market (DTCC, NASDAQ, NYSE) is moving to tokenization and near-real-time settlement in 2026, with plans for 23/5 and eventually 24/5 trading hours. [18:26, 19:09]
• Tokenized payments can reduce transaction costs and inflationary friction.

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6. AI, Agentic Economy, and Asset Management

The upcoming transformation driven by AI and its profound economic implications.

• Agentic economy: AI agents that run autonomously, make micro-payments, and create scalable GDP; this could uncap growth currently limited by human labor. [20:07]
• Most financial markets are “overvalued”—AI stocks (e.g., Nvidia) exhibit high price/earnings (PE) ratios (18–20 for AI; up to 27 for the S&P overall), indicating bubble risk. [21:10, 21:32]
• Jake is waiting for a pullback to invest in AI infrastructure; prefers investments with lower PE ratios (<15).
• AI will become crucial for asset managers to execute and rebalance trades at scale, outperforming traditional quant strategies. [42:55]

“I don’t know that there’s ever going to be a quant or a human that will be able to analyze things as quickly as… an AI…” – Jake [42:55]

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7. Past Market Failures: FTX, Luna, and Stablecoin Lessons

Hard-learned lessons from recent crypto crises and why Jake remains risk-averse.

• Discusses FTX collapse; FTX had more actual collateral than most banks (not as leveraged), but liquidity cascades led to bankruptcy. [12:31]
• Luna and algorithmic stablecoins: “not going to end well”—20% yields tipped off an unsustainable, risky model. [39:53, 40:18]
• Black swan events often strike when markets are euphoric and risk is unquantified; most high-yield strategies are unsustainable at institutional scale.

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8. Regulation, Technocracy, and the Future Political Landscape

Sober assessment of regulation needs and a possible shift in governance models.

• SEC and CFTC now offer joint guidance, with new OCC stablecoin rules pending. Regulatory clarity is progressing but hampered by technological illiteracy in Congress. [13:51, 14:32, 19:09]
• Jake predicts a future “technocracy” run by field experts (vs. politicians). [51:20]
• “It’s not a general election… but they are people that are super competent and capable in their field… If you look at people that sit in Congress today… a lot of them don’t have any concept of how any of this works or the technology itself.” – Jake [53:10]

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9. Digital Dollar, UBI, and Dystopia vs. Renaissance

Exploring both upsides and concerns around central bank digital currencies and AI-driven economic shifts.

• A digital dollar would provide government transparency, efficient social programs, and universal income—a solution to AI-induced job disruption. [47:43, 49:10]
• Jake envisions a near-term “renaissance period” where people, freed from subsistence work, unlock new creative potential. [50:59]
• Government could shift to AI-assisted resource allocation, preventing the “Soviet-style” equal distribution failures.

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Notable Quotes & Memorable Moments

• “We went zero to a billion in about a year.” — Jake [00:09, 15:18]
• “We’re the fastest growing RIA in the world.” — Jake [00:14, 15:20]
• “XRP will be locked up... as premium collateral and also settle that volume in that market.” — Jake [08:09]
• “If Tether got depegged, it would be a huge liquidity crisis across the exchanges and crypto as a whole.” — Jake [10:17]
• “If a quantum computer gets a hold of [Satoshi's wallets]... it's a big exposure for the network.” — Jake [35:35]
• “I think a lot of people are in for a roller coaster here.” — Jake [26:12]
• “They need a forcing function. And so, you know, I think that there’s a much larger game being played.” — Jake [26:26]
• “[Technocrats are] people that are extremely proficient, whatever their field is... It’s not a general election... super competent and capable.” [51:39, 53:10]

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Timestamps for Key Segments

• Jake’s Market Collapse Prediction: [00:00], [22:11]
• Origin and Role of XRP/Ripple: [01:09], [04:13]
• Bank and Institutional Use Cases for XRP: [06:08], [08:08]
• Stablecoin Risks (esp. Tether): [09:10], [10:14], [37:23]
• Institutional Crypto Custody/Client Demographics: [15:18], [16:17]
• Tokenized Stock Markets/Finance Infrastructure: [18:26], [19:09]
• AI/Agentic Economy Paradigm: [20:07], [42:55]
• Past Collapses (FTX, Luna, Celsius): [12:31], [39:53]
• Regulatory Progress/Technocracy: [13:51], [51:20]
• Digital Dollar, UBI, Society Shift: [47:43], [49:10], [50:59]

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Episode Takeaways

• High Alert: A major correction in both traditional and crypto markets may be imminent due to macro-level leverage and interest rate dynamics, particularly from Japan’s pending monetary shifts.
• XRP as Infrastructure: If Jake’s vision comes true, XRP will evolve into a core component of international finance—settling not just bank transfers but potentially the broader derivatives market and collateralization.
• Stablecoin Uncertainty: The continued dependence on opaque stablecoins like Tether represents the largest systemic risk in crypto.
• Institutionalization Is Here: Crypto is rapidly moving from its Wild West days to an era of institutional custody, compliance, and risk management.
• AI & Tokenization: The next phase of finance will be dominated by intelligent agents, 24-hour tokenized markets, and transparent, programmable money.
• Societal Shifts: These changes will likely precipitate government and cultural transformation, including universal income and more technocratic governance.
• Cautious Optimism: While the ride will be volatile, those who prepare and diversify may find the best opportunities during disruption.

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Further Resources

• Jake’s Wealth Management & Mastermind:
  • BeyondBroke.com
  • DigitalFamilyOffice.io
  • DigitalWealthPartners.net

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This summary covers all important points, integrating timestamps, detailed insights, major quotes, and a logical, engaging structure for both crypto veterans and newcomers seeking to understand the future of digital assets and finance.

Transcript

[A]

There's going to be a correction. I think we're going to see somewhere between 30 and 50% down on the stock market this year. I believe it's what will end up settling the back into the stock market, the FX market. Commodities eventually being labeled a tier one asset by the bis. We went zero to a billion in about a year.

[B]

Damn, that's a record.

[A]

But it is. Yeah. We're the fastest growing RIA in the world.

[B]

All right, guys, we got Jake at the Bitcoin conference. We'll talk a little Bitcoin, but mainly Ripple, I think.

[A]

Yeah, Good to go either way. Thanks again for having me.

[B]

Absolutely. Man, you're busy this week, so I appreciate your time.

[A]

Absolutely.

[B]

I know you're doing podcast events all week and then you're flying to another compass right after this.

[A]

Yeah. Running around, you know, cut hay while the sun shining non stop. Gotta, you know, bare market. Got to make sure that you stay ahead.

[B]

Yeah. How's the year been for Ripple? I haven't been really keeping up with much.

[A]

You know, it's down from last year, just like the rest of the market is. But I mean, sentiment's back up here. You got Fear and Green Index back in the 60s. So I think people are hopeful. A lot of geopolitical stuff going on that I think are eventually going to turn into some price appreciation for us.

[B]

Yeah, it's been one of those coins I hear about here and there for years. I feel like it's still around still.

[A]

I was in the top 10. It was first four or five assets that were ever created.

[B]

Yeah, well, really, I didn't know that it was that early.

[A]

June 2, 2012.

[B]

Wow. You got in June 3.

[A]

That would have been great. But no, I've been in. I owned XRP back in 2020, was diversified back then, made a bunch of money during that bull run. And then, you know, it's kind of led to what we do now.

[B]

Oh, okay. So you wait eight years after it was made, you got in.

[A]

Yeah.

[B]

Okay. You still made some good coin off it.

[A]

Yeah, I mean, decent. You know, a lot of the money that I made in crypto was actually off of other stuff. When I first got in, you know, bitcoin was at like 5,000. And I was like, ah, it's too far gone. Just like everybody. So, you know, I was in eth, you know, top, top stuff. Chain link was like first thing I ever bought.

[B]

I remember that one.

[A]

Made, made a lot of money on Theta.

[B]

I remember that one.

[A]

And then Cardano and XDC were kind of like the three biggest winners that I had in 20 and 21.

[B]

Nice. You cashed out.

[A]

I did not sell enough. Oh, but that's everybody's first cycle.

[B]

Yeah. It's hard to time it, right.

[A]

Yeah. I mean, you think it's going to continue? Everybody's euphoric and everybody's excited.

[B]

Yeah. All right.

[A]

Remember, you know, Elon going on SNL with the dogecoin? Yeah.

[B]

Then it tanked. Yeah. My mom bought some. That was like some normie mainstream stuff. They thought it like 10x after that. Yeah.

[A]

And that was. That was the top, you know, so top signal, man.

[B]

But yeah, it's been the bear for how long now? Like two years?

[A]

Well, you know, 2025 was pretty much entirely a bear market. We had a big run up there in November, December of 24, and then we had another big jump in June for. For xrp. And then, you know, kind of off on the cliff. I think the high ended up being like 350, 360.

[B]

Okay.

[A]

And then, you know, we're back down to 140 right now.

[B]

Wow. So it was. It was $3.60 at the high you said. Okay.

[A]

So it never even got its all time high either. The all time high back in 2017, 2018, like January 4th or 5th of 2018 was $3.84.

[B]

Damn interesting, I guess, for my audience because a lot of them might not have heard of Ripple. Could you explain why you got into it? What makes it special?

[A]

So XRP is actually the token Ripple, actually. So just take it all the way back when it was. First minute it was called X and S. And then that was by Open Coin. Open coin gifted 80% of the supply to Ripple. The founders kept 20%, which is pretty common across most of the assets that are out there. They. A lot of them have sold off over the years. Ripple rebranded at Ripples, and that's where everybody else kind of still gets confused on it. 2014, the IMF came out with a white paper talking about an exchange rate peg. And their abbreviation in that white paper was xrp. XRP got it. Shortly after that, Ripple rebranded the Token xrp. And it's been that ever since. So it's its own decentralized open source network. I would argue actually more decentralized than some of the other networks, but we'll save that conversation. So, you know, the whole premise behind this, the stigma in this space is it's the banker's coin.

[B]

Yeah.

[A]

Right. And I would actually say, yes, it is the banker's coin. It's what banks are going to use to settle between counterparties across borders. I believe it's what will end up settling the back end of the stock market, the FX market, commodities eventually being labeled a tier one asset by the bis.

[B]

Wow. So you're that confident?

[A]

Yes.

[B]

Have you seen like sort of like documents on this or you're just like,

[A]

I've been really blessed to be in rooms and have some conversations with some people.

[B]

Got it.

[A]

Talked to Mastercard and Visa back in 2024. We've talked to R3. We did a project with them. I can't talk about the project, but you know, they had a lawsuit with ripple back in 2014, 2015, ended up settling for 1.04 billion XRP that they use. R3 doesn't have its own settlement token, but it's infrastructure. They're kind of like the Oracle for large institutions. They build out proprietary blockchain infrastructure inside of corda, which is their blockchain. But because it doesn't have its own settlement mechanism, they leverage XRP as the primary settlement layer for that infrastructure.

[B]

Got it. Are any banks using it yet?

[A]

So it's been trialed in a lot of different places. It's never been like effectuated. Like banks aren't using it to exchange value yet.

[B]

Okay.

[A]

I believe that's because there's not enough liquidity in the token. They're actually going to have to drive the price much higher for them to start leveraging it in that capacity.

[B]

What's the liquidity now and what would you think it has to be to get to that level?

[A]

I mean, total market cap right now is around 130, 140 billion. I think the market cap is going to look absurd at the price point that I'm just going to, you know, throw out here. I think it needs to be north of fifty to a hundred dollars a token.

[B]

Wow.

[A]

Before there's enough liquidity in it for them to be able to start settling between counterparties at, at, at a massive scale. If you look at Swift, they settle $5 trillion a day.

[B]

What?

[A]

It's a lot, right? Copper happen back into the stock market. Something similar. You know, total global stock markets around $450 trillion. So daily settlement volume on that is somewhere between 5 and 7.

[B]

Wow. So that's trading volume, right?

[A]

That's trading volume and that's, that's what I think will sustain a high price for xrp. But they have to push it to a high enough price where they can start utilizing it inside that infrastructure.

[B]

They can't start with Smaller banks and then prove the concept.

[A]

Well, and they kind of have. So they've tried it with MoneyGram, they trialled it with bank of America. But you asked for like actual use case.

[B]

Right.

[A]

It hasn't been, you know, fully implemented yet. They've just trialed it in a bunch of.

[B]

So that's like the big play. Right. I hear that all the time with banks. And what else is their use case for xrp?

[A]

I think it'll end up collateralized. So you already started seeing it being wrapped on Solana. You've got wrapped xrp, you've got Flare is another network that wraps XRP and allows it to participate in defi to be able to generate returns. And the more XRP that's like locked off the market in ETFs or other structured products or if it does become a tier one asset, I mean, if you look at the way tier one assets are used today, US Treasuries are the backbone of everything. Primarily in the derivatives market. The banks actually have to post Treasuries in order to be able to trade into. Oh really? Yeah. So you know, stable coins, they're going to use U.S. treasuries because of the genius act. But I think derivatives, if the BIS does designated tier 1 asset, XRP will be locked up in those situations. It won't be able to be rehypothecated. Right now a lot of banks, they will lend Treasury. Yeah. Multiple times in order to facilitate that. And they really don't have a way to quantify all of the risk that they're currently taking in derivatives. So we need to tokenize that infrastructure so that they can actually quantify that that total market cap is around somewhere between, you know, on the low end, one quadrillion, all the way up to four quadrillion dollars.

[B]

Gosh.

[A]

Quadrillion quadrillion with a Q. And I think that that's the primary purpose of XRP over the long term is it'll be premium collateral and it also settle that volume in that market.

[B]

Okay. Is it being used as collateral right now for anything?

[A]

A few, you know, G. Treasury Ripple has acquired that company last year. You got Ripple Hidden road and now they have that prime broker. So they have a full stack that they use called ripple1 to be able to issue stable coins for banks. They provide custody and then they provide that that prime lending desk and they will take XRP as collateral and then post it on their balance sheet and be able to do other things with it.

[B]

Got it. Is XRP your biggest position?

[A]

It's my only position.

[B]

Oh, it's your only. No Bitcoin anymore. Did.

[A]

Were you ever in Bitcoin or. I've used bitcoin in the past. You know, I've, I've had, I've held Bitcoin for periods of time, especially, you know, 20, 21 2. But I consolidated my entire position to XRP in. In middle of 22.

[B]

You're all in. No stable coins either. I don't know how I feel about some of them.

[A]

Yeah. You know, so I, I'll say this. I don't know what's going to happen to Tether USDT over the long term. You know, we just saw that they froze $344 million in association with, you know, sanctions on Iran.

[B]

Jeez.

[A]

That being an open, decentralized protocol. You know, people I think may have used that to circumvent sanctions for a period of time, but now it's apparent that that's no longer going to be an option. And, you know, I don't know about their balance sheet. We'll see what the big four audit firm that whichever one they choose comes back with. But for them to launch USAT here, that's a compliant stablecoin. Why would you do that if you were going to get USDT to be compliant?

[B]

Yeah, it doesn't make a whole lot

[A]

of sense to me. So I'm with you. You know, I think that there's certain stable coins that I don't know about. Like, but I think Paxos is fine. I think that USDC is fine. And Rousd are the three that, you know, when we've talked to MasterCard and Visa A couple years ago, before ROUSD was released, those were the two that they felt comfortable handling and, and using.

[B]

I wonder what would happen if Tether got depegged.

[A]

You know, I don't know that it's going to get depegged, but it would, it would be a huge liquidity crisis across the exchanges and crypto as a whole. I mean, it's third largest market cap at this point. And it's. I don't know if you've ever tried to trade like out of USDC into Bitcoin or some of these other tokens. But the trades are significantly smaller than what you can. You know, are they with.

[B]

With Tether, you can't just cash out a million dollars.

[A]

No, there's just. Well, you could, but it's a lot of slippage. Right. So the trades are just significantly smaller. So, like, you probably could find a trade for USDT to XRP or for a million dollars, somebody else is willing to take the other. The opposite side of that USDC or ROUSD. Those trades are going to be 50,000 or less.

[B]

Damn.

[A]

And so you got to stack a bunch of those annoying. And. And the price is going to move while you're making those trades in and out of that stable coin into that crypto. So, you know, I. That's another reason that I think XRP will probably end up sitting in a unique position for exchanges. Have you ever heard of the Shane Ellis theory?

[B]

No.

[A]

So if you do some research on that, he talked about a situation where Bitfinex could go illiquid or there could be problems with tether and they would then use XRP and that's that position, and drive liquidity into it. While based on his calculation, he saw, you know, around a $500 XRP just for that one.

[B]

Holy crap. If Bitfinex goes under. Yeah, that'd be nuts. It is crazy seeing how FTX went under. But if they didn't sell any of their. Have you seen this?

[A]

Yeah. It would have been $151 billion.

[B]

All the Salmana they had, they had some other coins that went up like crazy.

[A]

Yeah. I mean they had anthropic and a bunch of other stock positions or, you know, I just. Nuts if they had left him alone.

[B]

Yeah. I wonder how SBF feels knowing not, you know. Did you ever meet him?

[A]

I. I never met Sam before we went to prison.

[B]

Oh, you met him after?

[A]

No, no, didn't meet him after either. But you know, I don't know. I think there's been a lot of players in the space that have. I don't think they were even necessarily malicious. I think that there just wasn't any oversight and they got a little over their skis. And then when there's, you know, liquidity issues in certain part of the market and they have stuff deployed there, they have losses. And then when there's a bank run. This is an interesting statistic. FTX actually had more collateral than most banks have.

[B]

Really?

[A]

Yeah. They weren't leveraged 10 to 1 like most banks are.

[B]

Wow.

[A]

So for them to go under, you know, CZ I think kind of helped orchestrate.

[B]

I saw that. Yeah. But then he got in trouble.

[A]

Max.

[B]

It's just like musical chairs. Right.

[A]

He went to prison. Now he's been pardoned by Trump. I don't know if Trump's going to pardon.

[B]

I don't think so. But he pardoned a lot of crypto bros. Yeah. A Lot.

[A]

Yeah.

[B]

And his sons are speaking at this event, so. Interesting. Yeah, yeah, they're definitely. Are you a fan of government getting involved with crypto or are you kind of against it?

[A]

You know, there's the libertarian part of me that wants it to be an open, decentralized ecosystem that anybody can participate in. It democratizes access and all the things that we want it for. Right. But there's also the part of me because I mean, we're an SEC registered ria, we're wealth manager, there's oversight and I think as long as there are checks and balances, it can be a good thing for crypto. We want the institutional adoption. Right. Like we've seen what the ETFs can do with the inflows that benefits everybody in the ecosystem. But that comes with some other things that the whole premise behind this technology is kind of shunned for a long time. But I think, I think those two things can work together. I don't know that I agree with government getting involved, but the regulators, I mean, we've got joint guidance from the SEC and the CFTC at this point, which is great.

[B]

That's good. That's unheard of.

[A]

Right? Yeah. And so, you know, I think that that's going to bring a lot of people back here to the US to be able to do their business. And then separate of that, now we have the OCC coming out with stablecoin regulation May 1st here. And so maybe we don't even need the Clarity act, but I think the Clarity act is going to get pushed out, you know, a lot further than people are hopeful for. I just don't think Congress really understands the tech enough to be able to regulate it the right way. And I think that's a good thing. I think that the, the regulatory bodies that exist, if they're able to bring forth some guidance and guide rails and checks and balances, that's a good marriage to be able to move forward and make sure that there aren't malicious actors rugging people or causing issues.

[B]

For sure. How crazy of a time was that for you when the US was going after all those US based crypto companies?

[A]

Well, so we, we took a gamble. You know, I've been doing this for about three years now. Well, really 2022, at the end of 22 is when I launched my consulting business. So we're, we're a full multifamily office. We specialize in digital assets, SEC regulated ria. We manage about a billion in crypto today. Yeah, the majority of that is XRP you could imagine. So we started taking assets and started to manage assets in October before the election.

[B]

Okay.

[A]

And we were like, we think this is going to go this way, and we think there's going to be some bipartisan support for this stuff. So we're going to. We're going to roll the dice. And so it ended up. We had perfect timing. You know, we went zero to a billion in about a year.

[B]

Damn. That's got to be.

[A]

I don't know if that's a record, but it is. Yeah. We're the fastest growing RA in the world last year. The previous fastest growing RIA was 0 to 600 million over three years.

[B]

So you, like, tripled it.

[A]

Yeah, it was. It's been a wild ride. And obviously the market's down since then, but we've continued to, you know, gain market share. We have a lot of clients that just, like, they're. They're crypto broke.

[B]

Yeah.

[A]

And they got in early, and now they're a little bit older. They have a wife or a spouse, and they have some kids or at least some on the way. And they're starting to think about legacy planning and how to be able to leave this to the next generation. And if you've got it on a cold wallet and your spouse has no clue about this stuff, and God forbid something happens to you, like, how many horror stories have you heard about people, you know, not being able to get into their cold wallet? And then the generation loses those assets. So we provide a multisig inside of institutional custody at Anchorage. It's insured up to $100 million.

[B]

Wow.

[A]

And that's a lot. Segregated bankruptcy, remote. They're still your assets. They're in an FBO account in your name. You can remove them at any time back to a cold wallet that you designate. There's a little friction there. It's 24 hours to remove them instead of it being immediate. But that's just in case there's like, a hack issue. Yeah. So, you know, try to provide the best of both worlds. Again, like, a little bit of friction, but at the same time, access to your stuff. And then also, like, let's say you want to go buy a house or get a line of credit or whatever.

[B]

Yeah.

[A]

Most banks aren't going to, you know, entertain your ledger.

[B]

Nope.

[A]

They're like, that's not an asset. We're not counting that. If you have it with us, it shows up on your balance sheet. It's a regulated entity. Oh, look at. So there's just a lot of you know, benefits, you do give up a little bit of control and oversight and freedom, but you also gain all these things that you would get from a traditional account. Right. So my joke is we're the Schwab of crypto.

[B]

It makes sense for a certain demographic that's older, doesn't know tech as well. Right.

[A]

I would say the majority of our clients, I mean, they are 45 to 70 years old and they have an allocation here, but they're not super tech savvy. They don't know how to deal with defi. They're. They're worried about moving it from an exchange to their cold wallet.

[B]

Right. It is scary. Every time I send a big transfer or something, my heart's dropping. It's like the worst system, honestly. Like, like, did I type a letter wrong?

[A]

Right. It doesn't when you look on the block, the block explorer, and make sure and check everything.

[B]

No. It's like the worst anxiety I ever get.

[A]

I mean, you send a million dollars in Bitcoin, you're like, it's supposed to be there.

[B]

Takes forever.

[A]

Yeah. I mean you get, you know, free verifications on the blockchain and then eventually it'll settle with the exchange with your counterparty. If you're doing cold wallets, a cold wallet is faster than that. But that's the other benefit of xrp. It's two to three seconds.

[B]

Really? So it's faster than Ethereum?

[A]

Yes.

[B]

Wow. Yeah.

[A]

1500 TPS is the max on the blockchain today. But they have, there's some patents that have an implicit or explicit subnet that Bob Way developed while he was at Ripple that allows for it to be basically infinitely scalable on the TPS side.

[B]

That's impressive. So it'll be quicker than Zelle when it gets in the banks much. That's impressive because wires are so annoying.

[A]

Oh, dude.

[B]

Especially on Friday afternoon. Right?

[A]

Yeah. Well, that's the other benefit of everybody tokenizing everything. With tokenized deposits, the stock market's going to be tokenized this year. We're going to move to 23,5 trading. So five days a week, 2023 hours a day. The DTCC has already said that they're going to move to real time settlement here in 2026 because that's really the only way that that actually works.

[B]

Yeah.

[A]

And you know, Texas Stock Exchange supposed to launch later this year. So you know, all those frictions that people have been dealing with for nights and weekends and holidays, that's going to be a thing of the past. I think by the End of this year.

[B]

Crazy. I didn't know the stock market was, was digitizing. Yeah, because now you can only trade 9 to 5 Monday, Friday, so you could do 23 hours now you said,

[A]

yeah, they're going to move to 23,5 first and then I think they'll go to 24,5 after everything's kosher and they don't need that extra hour.

[B]

Wow. I have not seen anyone talk about this. What the heck.

[A]

Yeah, there's. So the president of NASDAQ came out and said that last year at Swell in New York, which was Rebels event.

[B]

Yeah.

[A]

She was interviewed by Monica Long. And then you've also had the president of Nicee or the New York Stock Exchange say that they're tokenizing their exchange. And then Paul Adkins, who's this SEC chair has come out a couple times on public networks and talked about it as well. Nice, that's cool.

[B]

So no other coins you're investing in? What about AI?

[A]

AI is huge. I think there's going to be a huge benefit with the agentic economy. You know, agents can't open bank accounts but they can open a crypto wallet. So stablecoins and their ability to be able to pay micro payments on stuff like for API tokens. I think the agentic economy is going to completely remove this paradigm people have around market cap and gdp.

[B]

Yeah, that's a big issue. Right.

[A]

It makes it infinitely scalable because right now we're capped per person. Right. Like there's 8 billion people on the planet. We have to work. You know, you have families, you get sick, you know, there's downtime, vacations. Agents don't take any of that 24, 7, 365 and they're faster than.

[B]

Way faster.

[A]

So I think that that's going to be a huge benefit for, for transfers and payments for that ecosystem. And then, you know, with blockchain being a distributed database, you could hold proprietary data and then lay an AI over that. I think there's going to be a ton of applications for that as well.

[B]

So are you investing in the infrastructure or companies or.

[A]

We're looking at it. I think we're in a bubble right now. I mean Nvidia just hit an all time high today. It was like 200 and I don't remember $207. 7. Crazy. If you look at the chart, it's like straight up, I'm waiting for a pullback. I think that things are a little bit overvalued currently. If you look at PE ratios on a lot of the AI companies, they're 18 to 20 on a PE ratio.

[B]

Wow.

[A]

I like to find things that are closer to, like, you know, below 15 is, is really where I would look to.

[B]

What ratio is that?

[A]

Is that revenue to employee or PE ratio is like total income for the company versus total market cap.

[B]

Oh, got it. Okay. So 18 to 1 they're at right now. Yeah. And that's really high, right?

[A]

Yeah, yeah. So the total stock market's at the highest PE ratios that it's ever been, somewhere between 25 and 27.

[B]

Oh, my God.

[A]

Everything's significantly overvalued right now. And I think that's a forcing function of M2 being so high. This is the most money we've ever had sloshing around. And anybody that has that money, they're looking to put it to work somewhere. They want to leave it in fiat because it'll inflate away. So by proxy, a lot of that has moved into the stock market. And I, you know, I have a full theory on the reverse carry trade unwinding and how that kind of culminates to XRP's price appreciation, which I call the domino theory.

[B]

Got it. So 26 to 1, the market can't sustain that. So eventually it's gonna.

[A]

There's gonna be a correction. I think we're gonna see somewhere between 30 and 50% down in the stock markets this year.

[B]

Wow. They serious hud. So pretty quick.

[A]

Yeah. When the reverse carry trade unwinds. Are you familiar with.

[B]

No. Could you.

[A]

Yeah, absolutely. So Japan has held their interest rates at 0 and sometimes negative for an extended period of time. They're really low. Interest rates have happened over the last 25 years. And so because of that, anybody that could borrow from the bank of Japan has pension funds, hedge funds. Yeah. Warren Buffett, you know, and Berkshire Hathaway have done it.

[B]

Oh. So even if you're not a Japanese citizen, you could borrow.

[A]

Yes. So that's the deal. China is really good about this. If you borrow yen, you have to put it to work in their economy. Right. And that's why you've also seen, like ghost cities in China, because 90% of that has to be back in their economy and it can't leave their. Their society. So Japan didn't put those parameters in place. So anybody and everybody has borrowed money for free, basically swapped it for dollars or euros or whatever else, put it to work in markets. And when that trade no longer makes sense, they're not able to make the spread, to be able to service the debt as they've Raised interest rates. You started to see this unwind in August of 2024. The S&P was down 13% in a single day.

[B]

Geez.

[A]

And that was only about $2 trillion that got unwound. There's tens of trillions of dollars, somewhere between 10 and $14 trillion currently out on that trade. So as they raise interest rates and the US Lowers interest rates, which I think they may do here in the near term, you're going to see a rotation out of US Treasuries into Japanese Treasuries and all of that money is going to be pulled from markets to repay those loans. You've seen Warren Buffett, or not Warren Buffett, Berkshire Hathaway. They've invested a bunch in yen so that they can be a lender in that situation. The Fed has also stacked a bunch of yen to be able to support their currency. But also in a liquidity crisis, they can be a lender. So they all see this coming. It's just. And now that we've had this radar Hormuz shut down, I called that about eight months, a year before it happened. You predicted that? Yeah.

[B]

Oh, my gosh.

[A]

That's legendary.

[B]

Literally. I've never heard of someone.

[A]

I don't know if it's legend or not.

[B]

Well, not for that reason, but.

[A]

But, yeah, so. But I knew that they were going to have to raise oil to push Japan into a corner and give them a scapegoat to be able to do this. And so now that we have that happening, you've seen huge inflation in their economy and they're basically backed into a corner where they're going to have to raise interest rates aggressively.

[B]

Iran's economy or Japan? Oh, Japan.

[A]

Japan gets the majority of their oil from the Middle east through that corridor. And so with that being shut down, their, their energy costs are going up exponentially and their supply that they had, you know, on the backlog isn't going to last much longer. And so in order to keep their currency in a position where it can maintain its value, they'll have to raise interest rates in order to offset that. And that's what'll cause all of this to, you know, compound and markets to collapse. But luckily we have the genius act. Like I said, the OCC has regulated it and they've got guidance on it that should go into effect on May 1st. And that'll allow the banks to absorb those Treasuries when all of that unwinds. So it'll stabilize the bond market. Like the dollar's not going to Collapse. We're going to be okay. There's just going to be significant losses across pretty much every other market. I think you could see $50 silver. I think you could see $2,200 gold.

[B]

Whoa. Right now, what are they?

[A]

Gold's at 45, 46 and silver's at 77. $80.

[B]

Okay.

[A]

Somewhere in there. But they were at all time highs. You know, gold was almost. I think it was over 5,000 for a period of time. And then silver was all the way up at like 110.

[B]

Jeez.

[A]

So there's been some pullback, but I think there's going to be even more pullback and I don't think it'll be long lived. I think we'll v. Bottom out of there like we did with COVID Yeah. But yeah, it's. I think people are in for a roller coaster here.

[B]

Wow. So we're like hurting ourselves with this war, basically.

[A]

I think we needed to happen though, in order to be able to shore up our currency and continue to move into this new paradigm where they can implement this technology.

[B]

Yeah.

[A]

They. They need a forcing function. And so, you know, I think that there's a much larger game being played.

[B]

Yeah, man, I didn't know about that Ja. Ja. Japan stuff though. Yeah.

[A]

I mean, not a whole lot of people. There's four or five of us on Twitter.

[B]

Okay.

[A]

Talk about Twitter.

[B]

Yeah, yeah. That's a whole. Another world.

[A]

Crypto Twitter, man.

[B]

You guys are different. We not.

[A]

We are.

[B]

Yeah.

[A]

I don't know. You know, Twitter is my news source. Like I get everything real time, very quick.

[B]

Yeah, yeah. You get. You find out like quicker than the mainstream, I feel like on Twitter. Right.

[A]

Yeah. One is not as manipulated.

[B]

Yeah. Has this happened before where another country was offering 0% or good rates and this kind of crashed our economy, you

[A]

know, nothing at this scale. There's always been discrepancies. If you could go borrow from another country and exchange rates and. And people play that market all the time. You see crypto talk about, you know, the FX market and trading. Yeah, yeah. So there's always stuff like that, but there's never been this much leverage at scale that's been deployed globally. That'll be basically, you know, a credit call all at one time.

[B]

Yeah. You said 14 billion.

[A]

Trillion.

[B]

Oh, trillion. Yeah.

[A]

With a T. Geez.

[B]

I can't even. That. That sounds like I can't comprehend it. It's just like a lot. Oh my God.

[A]

Zeros.

[B]

14 trillion.

[A]

Yeah.

[B]

Who was borrowing most of that?

[A]

Is. There's not like one in particular. Right. So like I mentioned, you know, companies, sovereign wealth funds, nation states, it's across the board.

[B]

Wow, that's crazy, man. Well, we'll see how it plays out. You said this year it's going to

[A]

happen so I'm pretty confident that we're going to see it play out. I mean we've got the bank of Japan coming out tonight with their monetary policy on the 27th and then you got the FOMC for the Fed the 28th and 29th of this month. I don't know that they're going to be able to pivot until that stablecoin regulation from the OCC is in place. But as soon as that's in place, I think they'll have the green light to let this thing run. So.

[B]

So are you going to set some options?

[A]

I don't know that they'll execute. Like that's my other concern. A lot of people are like well I'm going to buy lower, I'm going to buy Bitcoin at 20,000 or you know, you see these crazy numbers. If tether has problems because of the reverse carry trade which I think is a possibility because of the stuff on their balance sheet and the rest of the world's in a credit crisis, it's going to be very difficult for people. I think things will lock up. Like Jim, Jim Rickards talks about an ice9 type event. I think that that's what we're headed for.

[B]

So tether will be frozen.

[A]

I just don't think trades will execute. You could have limit orders but I

[B]

happen on Robinhood for certain stocks.

[A]

I mean you may get it there, right? But yeah, crypto markets I think are going to have some issues. I just continue to dollar cost average at the points that we're at. Yeah, you know I don't, I'm not trying to catch a fallen knife.

[B]

Yeah, it's been tried and true method dca zoom out at the charts. You're pretty good in the long run. If the markets freeze. Has that ever happened before in crypto where you just couldn't buy or sell?

[A]

I mean on specific cryptos. Right. If things go illiquid for whatever reason, you know, Luna was difficult to execute trades.

[B]

I got correct on that.

[A]

Yeah. When, when, when they launched Meta, the Meta Planet for like the apes and all of that, you know there was so much volume across Ethereum, people were paying $50,000 gas or something crazy. So there's, there's been other instances where there's just too much volume or too much demand at One time. And things lock up and can't process and there's a lot of slippage.

[B]

How's that ever happened with Ethereum, where so many people are trying to get in and the prices.

[A]

That's, you know, that's the one time that I can recall where, you know, there was just so much latency on the transactions and so much additional cost because of the volume of the other Metaverse Time.

[B]

Yeah. Really? So people are using their Ripple to buy the.

[A]

No. Ethereum.

[B]

Oh, Ethereum.

[A]

Yeah, yeah, yeah. For. For xrp. There has been two times in its history where it's been paused. The network's never gone down like Solana. Um, but there have been two instances where they just paused things until they could reconcile everything and push it through. The volume is too much, right? Yeah, it. It's the most it's ever sustained for a period of time has been like 200 transactions per second.

[B]

Okay.

[A]

For. For a couple weeks. But again, you know, I think that there's going to be this, this subnet that allows it to scale significantly higher TPS, because if you look at MasterCard and Visa, both of them are 30,000 TPS.

[B]

What does that mean?

[A]

Transactions per second.

[B]

Oh, wow.

[A]

So, you know, if, if you. There's really not a blockchain that currently has the capability to scale to that level of TPS securely. But I think the XRPL has these other patents and other things that'll allow it to do it.

[B]

What's the cap out right now for? How much can it do per second?

[A]

They've revved it up to 15 tbs a couple times. 15.

[B]

15.

[A]

Sorry, 15,000.

[B]

Oh, 15,000.

[A]

So half of what master 1500. 1500 cost 1,500. So, you know, that's not enough in designing. We're close to what MasterCard Visa would need.

[B]

Yeah. Because you said they're doing 30,000, so that's like 20x.

[A]

Yeah.

[B]

Wow. But those guys are worldwide and. Right.

[A]

Well, they have all these trusted partnerships. Their margins that they operate on are about 50%.

[B]

50%?

[A]

Yeah. They're charging 2 or 3% per transaction.

[B]

Wow.

[A]

And they're paying, you know, one, one, one and a half transaction, and they have all these trusted parties to be able to facilitate that. But if you think about it, if they could move those transactions at the same tps or a greater TPS and their margins increase significantly, they could actually reduce rates to everybody and that would actually bring down some of the inflation that we're seeing. If you could remove 2% on all transactions every massive.

[B]

Yeah.

[A]

And then because of the volume of payments that they'd be able to process, they could actually make more money. So I think that's why you're seeing American express, Visa and MasterCard kind of lean in here and want to start leveraging the technology.

[B]

Yeah. You think a lot of it gets to the point like a ripple credit

[A]

card or something like that, like using xrp.

[B]

Yeah.

[A]

Make payment to like pay for things

[B]

on a credit card.

[A]

The other counterparties would have to take the xrp. Right. So there's been people that have rolled stuff out right. Now, like MasterCard has had a few trials where they've partnered with Uphold or other exchanges and you could basically sell your XRP and then they would settle the trade in USD to the merchant.

[B]

Got it.

[A]

So you have tax implications for that.

[B]

Yeah, that's the annoying part.

[A]

So, and that's, you know, I'm hopeful just like everybody else that Trump comes out and says no capital gains on crypto, please. But that's really the only way that this works at scale for the banks. Right?

[B]

Capital gains.

[A]

Well, because there's always gonna be small discrepancies between when they send the payment, when it settles.

[B]

Right, right.

[A]

Because there's variations in the price and you want it to be, you would want whatever asset was settling that to be dynamic, to be able to manage the capital flows. Because if it's fixed and you had more volume come onto the network, at some point there's, there's going to be problems the other way.

[B]

Right.

[A]

So, you know, even if it's fractions of a penny, thousandth of a penny, all of that could rack up at the end of the year. And then banks are going to have to be able to reconcile that and pay the. They're not going to do that. So I think they'll just say, hey, look, like these specific cryptos, as long as you're using it in a business application, no capital gains on it.

[B]

Please do. That's why I don't sell my crypto.

[A]

Yeah.

[B]

I just take a loan out against my portfolio.

[A]

That's the way to do it, man. We do that now we have credit facilities with multiple partners, so we do a tri party agreement inside of institutional custody there and you can get, you know, however much liquidity you need.

[B]

90%, right? Some.

[A]

Yeah, we're, I mean, we're not like AAVE or compound. Most of the lenders that we work with are willing to do like 40 to 60%.

[B]

Well, actually it's more volatile.

[A]

Yeah, yeah. Well, I mean, even bitcoin I think they'll go up like 65% on Bitcoin, but I don't know, like, it's kind of irresponsible to take out that much ltv, especially with the volatility in these assets currently. Yeah, we, most of the time we're looking at like somewhere between 10 and 30% for most of our clients. And again, we're a fiduciary, so a lot of our advisors have to just take things into account and make sure that they're not giving their. Giving our clients bad advice.

[B]

Yeah. Do you worry about quantum computing at

[A]

all for certain blockchains? I do. I think that they're going to need to upgrade a lot of these networks by 2028, otherwise they're. They're going to be susceptible to that. I know that that's been, you know, a point of contention in the bitcoin community for the early wallets. And they're trying to work through a scenario on like, best way to be able to navigate that. They don't necessarily want to fork the blockchain. So, you know, they're either going to freeze accounts or do some, some interesting things. I think it'll be interesting to see. I think Satoshi is going to move his bitcoin.

[B]

You think he's still alive?

[A]

I don't know that satoshi still alive, but I think somebody has access to those wallets.

[B]

Really?

[A]

Yeah.

[B]

Wow, that's quite a theory right there.

[A]

Yeah.

[B]

You think he's going to move it to another wallet?

[A]

I don't know. I think that they need to. Right, that's. That's a large portion of the 3%, right? Yeah, like 1.1 million. So it currently sits in the wallets that he controls. That's more than 3%. We have 19 million Bitcoin today. So it would be 5%. Yeah. A little less than 5. Well, yeah, around 5% of the total supply is held by Satoshi.

[B]

Wow. Yeah. So if that gets dumped, it would tank the whole price.

[A]

Well, that's what I'm saying. Right. Like if a quantum computer gets a hold of those wallets, if he doesn't move it to upgrade it, it's a big exposure for the network.

[B]

Well, it's just 16 words. I'm sure they can hack that in a couple years. Right.

[A]

Well, a lot of those are going to be paper wallets that were super early on.

[B]

So what were those operated on? It wasn't a.

[A]

Same deal.

[B]

It was.

[A]

Yeah, but yeah, as long as you had multiple attempts, a quantum computer could figure it out. And the other piece for quantum computers is like both keys need to be exposed. So any of those wallets that had sent Bitcoin somewhere. So the receiving key and the, the other key that it has, if both of those are exposed, that allows a quantum computer to hack it. If only one of the keys is exposed, it'd be much more difficult.

[B]

Oh, really?

[A]

Yeah.

[B]

So you need both. Yeah. Okay, so not getting the seed phrase isn't enough.

[A]

Well, I mean, you could, you could hack it that way, but the keys are really how a quantum computer is

[B]

going to attack these. Oh, okay. I always thought they were going to use them to get the seed phrase, but I guess the keys are easier.

[A]

I mean, it's kind of both. Right. So the keys allow you to get into the wallet. Yeah, but that, yeah, that's, that's from David Schwartz. You know, again, a lot of this technical stuff, like, I am not a quantum physics.

[B]

Yeah, that's a whole nother world.

[A]

So I listen to people that are smarter than me on those topics and that's, that's something that he's talked about is, you know, if, if both of the keys are exposed, it's. It's sent and received. That's, that's when there's exposure. If it's only ever received the asset and that sending key isn't exposed, then you probably wouldn't have to worry about quantum threat.

[B]

What else do you see as a big threat to crypto or xrp?

[A]

Crypto and Tether. You know, we talk about that. I would love it to see if they did get audited and where their balance sheet was and what exposures they have.

[B]

When was the last time they got audited?

[A]

They've never been fully audited the bank. So in New York for the bit license, they did sue them and came after them. And the most they got out of them was a pie chart that showed what they had on the batch. Yeah. No, there was no, like line by line item or audit that actually took

[B]

place that is concerning that.

[A]

So. Yeah. So like I said, when we talked to MasterCard and Visa, they were like, we don't touch tether.

[B]

Oh, God.

[A]

Just Paxos and usdc.

[B]

Wow. I don't blame them.

[A]

Right. I mean, the unknown. Right. And if you're a financial institution or a fiduciary, like, you can't. Those unknown risks are things you can't play with.

[B]

Yeah. Do you think there'll be another weird time where a bunch of exchanges shut down and they're not liquid ever?

[A]

You know, if, if Tether was used in some capacity as a. A pawn. I think it may have been rolled into the US government back in 2014, 2015, personally.

[B]

Yeah.

[A]

And you had all these other stablecoin issuers. They're going to come onto the market and you wanted the financial institutions to be able to roll up these exchanges. If you were to topple tether, they would then be able to buy those up for pennies on the dollar in a liquidity crisis. So. And that would also make room for all of these other stablecoin issues to gain significant market share if there was some disruption there. So that's, that's my conspiracy theory.

[B]

There's some chess being played out here.

[A]

I think so.

[B]

Wow. That'd be concerning. Yeah. The last one was nuts, that when Gemini was illiquid, FTX shut down. There was a few other big ones that shut down. Big Forex. I was on a little bit Voyager and Celsius and. Yeah, Celsius was a big one.

[A]

Yeah, A lot of people lost.

[B]

Did you see that comment at all or were you shocked?

[A]

So about three months before everything happened with Luna, which was before, you know, all the other things happened, I flew to an NFT conference in Miami and they were touting Luna. There was. There was an eth whale there that had staked his eth and then got tether against it and restaked the tether and then they levered up and took all of that and put it in UST and they were, you know, generating 20 yield at service to debt. And like, because they had done it in aave and I was like, this is not going to well. And I told everybody that came with me, I was like, I wouldn't play with that fire. And. And most of them listened. There were a few of them that didn't. And when it depegged, I sent everybody on the group text. I was like, I tried to tell you guys what's gonna happen here.

[B]

That one hurt. I thought I was set for life making 20 a year, dude.

[A]

An algorithmic stablecoin, like makes like I understood it. And I was like, there's just this exposure there where it's a negative feedback loop if it does depeg and people capitalize on that. And then that's what ended up playing out.

[B]

That was too ambitious.

[A]

Yeah, I think so. You know, sustain like anytime. So we work with family offices and anytime we talk about returns that are greater than 8 to 10%, they raise an eyebrow because their, their job is capital preservation.

[B]

Right? They're.

[A]

They want return of Their capital and then a return on their capital. Those are their objectives, in that order. So, you know, if you are looking for capital preservation, you're probably playing downstream of the more risky stuff. You might take a small portion of your portfolio and play there, but it's, it's not enough to make a problem happen if you were to lose it.

[B]

Yeah, I mean, with your AUM, there's no way you're getting 20 with a billion dollars.

[A]

No. You know, there's our target. So the way that we have the fee structures is we charge a 2% AUM fee for anything less than 5 million, 5 to 10 million. That drops to 50 basis points. Anything over 10 million, we're 40 basis points. That's all we charge. And then we create derivative products to be able to hold the asset as collateral on the inside of the institutional custodian. We reflect that out, so we mirror it on an exchange so the assets never leave. And then we get a line of margin against that. We only ever trade like somewhere between 30 and 60% of that line of margin. So that mitigates volatility risk. So like 10, 10 happened. We had no assets called away. We got good, which was nine times larger than the ftx.

[B]

Really?

[A]

Yeah, it was that. I don't, I'm sure you were around for that day. Everybody was freaking out, but we, we had no capital called away. So our whole strategy works perfect. Mitigate counterparty risk, mitigate volatility risk. The only risk that we have in the hedge fund that we have is that the strategies don't perform well.

[B]

Got it.

[A]

And in a low liquidity environment, you know, we haven't done great. We did, you know, 5% return last year, but just holding your assets and getting a little bit of cash flow,

[B]

I feel like for crypto, that's actually decent.

[A]

Yeah, well, bear market, it's sustainable. Right. People that get on the far end of the risk curve and are promising these high returns, it's, to your point, just not sustainable over the duration.

[B]

Maybe if you have like a thousand bucks, if you get 20% or something light.

[A]

Well, it's the same thing for Warren Buffett. Right. So you look at the Berkshire Hathaway and how much money they manage. Their $380 billion is sat on the sidelines and Treasuries right now and in the yen. Once you get to scale the asymmetric bets and opportunities that exist in the market, you have too much capital to deploy to even be able to participate in that. That's where I think AI is going to come in. I think that these asset managers that implement AI and they're able to manage, you know, millions of trades instead of having to take big chunks and put it places. That's going to allow, you know, these hedge fund managers and other people to generate those outsized returns that you're looking for, even if they have larger aum.

[B]

Interesting. So you think AI will be making a lot of the trades in the future?

[A]

Yeah, I don't, I don't know that there's ever going to be a quant or a human that will be able to analyze things as quickly as, and rebalance portfolios as fast as an AI could and then you can scale it.

[B]

Right. Well, I know some hedge funds have been using some sort of AI system for a while.

[A]

I have a good friend, Howard Getson, that's been doing that for almost 20 years.

[B]

Wow. That long.

[A]

And he's had, you know, somewhere between 10 and 30% returns over that duration.

[B]

That's insane. For what amount of money managed, he

[A]

has about 400 million.

[B]

That's insane.

[A]

Yeah.

[B]

To get 10 to 30 on that. Yeah, he's on with AI. It's possible, I guess. Right?

[A]

Yeah. And he's been using it for, like I said, a long time.

[B]

So is that crypto or stocks? Stocks. Okay.

[A]

Yeah, he's, he went to that conference with me. Oh yeah, he goes at the NFT

[B]

deal and he was not a luna.

[A]

I'm not playing, dude.

[B]

I almost put a million into that. Thank God I didn't. But I put a couple hundred K. I was like doing the compound calculator math on it and it said it would have been like $100 million in like whatever, 40 years or something. Crazy.

[A]

Yeah, it's crazy, right? Like, and that's the whole point, right. If you can, if you can get a large enough sum of money and park it somewhere that's sustainable, the compound on that is where you really end up winning over the long term.

[B]

Yeah, yeah. The spreadsheet warriors 7% a year in the S and P. Man, you could become 100 millionaire.

[A]

I don't know. Like, the problem with that is. And my dad was a big advocate for the S and P. You know, he was like, just take your money, set it and forget it.

[B]

Yeah.

[A]

You're basically just maintaining your purchasing power because of inflation. Because of inflation. Right. So the stock market, if it moves 7% a year on average, you're doubling your money every 10 years. Ish. With a law of 72. So I think it's 10. I think is the average on the S P and it's every seven years, something like that.

[B]

I know you look at it, but

[A]

really you're just locking in the purchasing power of that capital when you put it in there. I look, I look at gold kind of the same way, and I think gold is overvalued in comparison to other assets. I like to look at things priced not in dollars, but other assets. So if you look at gold to real estate or gold, the S P, you can see that it's value in comparison to where those are at.

[B]

Yeah, most people don't view it that way. They just see the dollar amount.

[A]

Yeah, well, and it's distorted.

[B]

Right.

[A]

Because of inflation. It's, it's hard because it's not actually a stable value. It's actually a declining value that you're pricing that against.

[B]

Also, I never know what to believe on how much gold there is. I know they say there's a finite amount, but it seems like it's never ending.

[A]

Well, so the whole premise, the Fed Having a 2% inflation rate is what they calculated as like how much gold they could mine per year.

[B]

Oh, okay.

[A]

And so that's why they, they stuck with that number. Like there was 2% more gold coming onto the market every year.

[B]

So that's a lot done. Right.

[A]

I mean, it's relative, but. Relative. Yeah. And you need credit. Right. Like people want to do away with the banks and the way that this works. But at the same time, tech wouldn't be able to advance as fast as it has if we didn't have an engine or liquidity to be able to put toward that, to be able to continue to grow. These companies, especially the AI, right. Like they've raised $100 billion or something for not, not anthropic. Maybe anthropics is raised that much too. But Sam Altman, if you didn't have that much capital to put toward it and people didn't have access to liquidity, the growth of the economy would be significantly slower and so would technological advancement. And the bet is like at some point Moore's law is going to go exponential and there's going to be a huge deflationary event. And I think that's what we're on the precipice of here. And if you knew that was coming, then you would just print a ton of money because there's a huge deflationary collapse coming and that would actually soften the blow when that takes place.

[B]

That's what they did in the pandemic. What would you do? To save the dollar. Do you think it's saveable at this point?

[A]

I think that they're going to back it with gold. I think on the 250th anniversary this year, we're going to see gold back bonds again. Judy Sheldon's talked about that. You know, they're gonna have the ball drop there in New York. They had 220, 26 deal. What's the lady that's on Ripple's board, Rosie Rios, she was there talking about that. So I don't know. I think that this is going to be a really special year and I do think that they're going to be able to stabilize the dollar. I don't think the gold in Fort Knox is there.

[B]

It's not there. It's definitely not there.

[A]

It's definitely not there. But you know, on the Fed's balance sheet, gold still sits at like $42.

[B]

Oh, really? They got in really cheap.

[A]

Well, I mean that was the last time they revalued it before Nixon closed the gold window. So if they repriced it to where it is today, it's still not enough gold. And that's why I think that they're potentially going to have to use, you know, xrp, oil and gold to be able to back currencies across the world to have a level playing field and shore up the system that we're currently in.

[B]

You a fan of the digital dollar that's being rumored about?

[A]

I have mixed feelings on it, yeah. Same reason. Reason being so social programs, I think they're absolutely needed. I think people that are on unemployment and you are using those things for the reasons they should be using them for. It's a great bridge for people and I think it should be there. Medicare, Medicaid, all that stuff. The problem is, the problem I have is when people manipulate or pervert the system and use it in. In a way that's not how it was intended. So, you know, they've done a lot with WIC and like food stamps to be able to mitigate the risk of people like selling those for drugs stuff with them. But that's the benefit of a digital dollar, right? You could have social programs, you would have full transparency and visibility of how those dollars were being used. And I think that we're going to move toward a paradigm and this is going to sound dystopian. Okay, so just stick with me. If you had AI and it could analyze all the transactions across an economy and you could print money in opposition to the deflation that we're going to have from all of this progressive tech converging, you would need to. And actually to hold price stability. And then if the AI could look at all of that, it could actually allocate that capital or incentivize or disincentivize spending across the economy to fill gaps. The reason that the Soviet Union failed was they just spread it evenly and there was discrepancies in the economy that they couldn't account for. So it's kind of like it's not socialism. I think it'll be called something else.

[B]

People hate that word.

[A]

You know, Elon talks about universal high income. Right, right. And I think that's going to be a thing. I think if you make less than $150,000 a year, they're probably going to supplement your income. And people are like, oh, they're going to have to tax everybody to death. I don't think that they will. I think that the output that we're going to see from AI agents and the convergence of all this other technology is actually going to have a huge benefit on GDP and we'll see actual growth in the economy. It won't come from people.

[B]

Wow.

[A]

And so if we're able to produce more, there's actually something that'll be able to supplement that and they'll be able to print money again to be able to hold price stability. So we might be a few years away from that. I think, you know, 27, 28 is probably when that could, that could actually be a possibility because they have to implement digital currency first and get people to adopt it and all the stuff. But that's the reality. And then, you know, people look at that like, oh, you know, all these jobs are going to be gone. They will. People are going to have to retool, but you're going to need a bridge for those people. Just like I talked about, if you lost your job, you need something to supplement you till you find the next thing. And I think we'll go through like a renaissance period. I think a lot of people work a 9 to 5 or multiple jobs to put food on the table. And they have all of these other wonderful talents that they can't even explore because they don't have the time for it.

[B]

Right.

[A]

Like how many artists or singers or other people never get their chance or opportunity even in the creator economy because they're like, well, I don't have time. Like, I have to go, I have to pay my bills. I got to pay for my kids. I got this, I got that. If you were able to supplement that. And everybody had a standard of living that they could live under, and then they could explore those things. I think that you'll have, you know, a lot of the. And that's going to be the benefit that I don't think can fill the gap on the creative component that people have.

[B]

I don't think it will get there anytime soon. Maybe in the future.

[A]

But, yeah, it's gonna. I mean, you have to have consciousness and a bunch of other stuff at that point.

[B]

Right.

[A]

But I think over the next five years, you could see another renaissance period where people actually get to explore their gifts and have a sustainable, sustainable standard of living.

[B]

That'd be incredible. Yeah. Everyone thought Andrew Yang was crazy when he brought up ubi, like, five years ago or whatever. Might have been even longer. He's been talking about it for ages. Yeah. But now he's looking like a genius.

[A]

Yeah. I mean, and the other thing, I think government's going to be completely reformed, you know, so. Elon Musk's grandfather advocated for a technocracy back in the 30s and 40s. I think that that's what all of these, you know, technology moguls are moving toward is a technocracy.

[B]

What would that look like?

[A]

It's really interesting. It's not what you think, you know, it's not like this dystopian AI masturbating. Well, you know, you could argue mass surveillance is good or bad. Have you ever been to Dubai? No, so. Safest place I've ever been to, ever. They have mass surveillance. You're never not on camera in Dubai. You know how much crimes in Dubai I heard?

[B]

None.

[A]

Basically none. The only time I saw a police officer, there was a guy, he was helping him change his tire.

[B]

Wow, that's crazy.

[A]

So anyway, that, like, you could argue both directions on that, but. But back to the technocracy. You basically have people that are extremely proficient, whatever their field is, and they come together and sit on a board and they elect somebody out of those people that kind of governs things. It's not a general election across the public, but they are people that are super competent and capable in their field. So engineers, other people that actually understand how all of this works. If you look at people that sit in Congress today, again, just going back to the blockchain, like, a lot of them don't have any concept of how any of this works or the technology itself. I was on a deal for the Digital Chamber, so we were the only RIA that sat on the board on how to regulate RIAs and propose that legislation to the SEC. And they took all of our stuff, which was cool. But in those conversations talking about tokenized securities, they were still looking at the blockchain like you had to roll it back if something went to the wrong place. And I'm like, that's not how this works. Issued assets can be frozen, they can be clawed back.

[B]

Yeah.

[A]

And all of that's still on the blockchain. And they were like. So my point being, you know, if you don't really understand the capabilities of the technology, it's very difficult to regulate it appropriately. And that's why you would need people that are extreme experts in their field all sitting on a council, going back forth on ideas, but again, just different paradigm. But I do think that that's where we're headed.

[B]

Yeah, sounds fun, man. We'll, we'll be there soon, it sounds like.

[A]

Could be.

[B]

In the meantime, man, where could people find you, Keep up with you, learn more about you? I know you got a mastermind too.

[A]

Yeah, yeah. So we, we have a mastermind group. We get about 17, 000 people in that BeyondBroke.com provide financial education, business resources, access to private deal flow. We have more in real life events than pretty much any other crypto community outside of like Crypto Mondays. Shout out to Louis. So there's that. And then if you want the wealth management or need some estate planning or tax advice or all that stuff, and you have, you know, more than a hundred thousand dollars in digital assets, you can go to digitalfamilyoffice IO for the estate planning and taxes and all that. And then the wealth management is digitalwealthpartners.net awesome.

[B]

Thanks for coming on, man. That was fun.

[A]

Absolutely. Dude, this is great.

[B]

Yeah. See you guys. If you learned anything from this episode or got any value at all, please share this episode with a friend. It helps us us grow the channel, it helps us grow the podcast, and it means a lot to us. Thank you so much.