C (2:43)

Yeah, it was. And, and I think, you know, right now we're still in this mode where everything seems to have broken. Right. So I, I'm going to take the PMI with a, with, with a little bit of a grain of salt insofar that I really need to see liquidity turn. I need to see this whole shutdown narrative turn. I need to see Fed basically recognizing that inflation is basically at near zero. I realize prices are elevated post Covid, but we saw several Six Sigma events that pretty much broke everything that wasn't supposed to be breakable in the last two weeks. Two weeks, not two years. And so we've never seen anything like this collectively, not just because we weren't alive. It just never happened. And so, yes, I think PMI turning is important, but now we need to see kind of directionally that liquidity is coming, that people sense that there's some macro stability, some geopolitical stability, you know, potential for a coup or an overthrow in Iran is not going to help the markets. In the short term, it might. In the long term.

A (3:59)

That'S still happening. I already forgot Venezuela happened. I thought we were. I heard something about Somalia.

C (4:06)

Yeah, exactly. That was two Grammys ago, I think.

A (4:09)

Yeah, yeah. I don't even know what, what, how many conflicts ago that that is, but yeah, I mean, Andrew Tillman, is this something that was on your radar? Obviously we know that Bitcoin follows liquidity cycles to some degree, and this one of the ones that some of the, you know, bigger names in the industry, as I said, have been sort of watching and saying, listen, this thing is going to turn around and this is going to be our signal.

D (4:31)

Well, yeah, I think Bill's right as it pertains to taking it with a grain of salt. I think there's so many indicators, it's kind of pick your poison and the combination of the indications, you know, are really where the magic lies. I don't, I don't trust it. Honestly, what Bill just said, there was probably five or six things that needed to happen to instill confidence in the markets. And I don't, I don't think those five or six things are going to happen. The Clarity act, it's, it's a mess. That whole debacle has really caused, I think, a pretty good pause. But that's where the rounding bottoms happen. That's where the opportunity lies. I do believe we are setting up for that. I just don't know how short term or how I'm not sitting here saying time the market, this is the bottom, go long. And I do think there's a lot of sentiment out there that is still tied to leverage positions. And when there's leverage at play, the price is going after the leverage before it goes after the long term move. And there was, there's been so much liquidation events. I mean, I think the, the thing that started this, if I, if I remember correctly, was when we broke 126. I think that Shakeout liquidated $19 billion of. Yeah, yeah. And so that was a cascading event that again has instilled this like catastrophic fear type of mentality. You saw it in the silver market. I've been following that closely and you know, you've got a lot of different opinions. People are calling what we saw, you know, this last week a blow off top and the largest drawdown, which it is in the history of silver. But then there's a lot of people are saying like it's the foothills to the Himalayas, like we're, we haven't seen anything yet. And there's macro things that are, you know, at play and blah. And so, you know, good luck, I think. But the volatility is a feature. And here, here's my only sound advice, which in my youth I never took and which is like be diversified in a prudent way in terms of not being over allocated across a variety of assets that you have a degree of confidence in and then just wait for their day in the sun, you know what I mean? Because you're eventually going to be right if it is a sound investment and sound, you know, asset class. But you may have to wait a lot longer than you think because there's a lot at play from a, from a leverage perspective that takes precedence in my opinion.

C (7:15)

Bitcoin right now.

D (7:17)

I agree.

A (7:17)

I would like to point out this exactly what I was going to say, Bill, just to echo your point. Bitcoin is down or went down to the lows. So Obviously we bounced 41% from the high 41%, which you can argue we're in a bear market since that happened. But 41% in a bull market is very standard if you consider this a bull market. Silver went down 41% in five days. I don't hear anybody screaming about the death of silver or the bear market in silver. So it really is the time and the brutal, just capitulation as it draws down slowly that's killing people because you don't Hear many foothills of the Himalayas commentary on bitcoin right now.

D (7:58)

I think we are though. I mean. Larry Fink. I'll tee up Andrew. He's next. Larry Fink, what does he say about the foothills to the Himalayas and bitcoin?

A (8:08)

Busy running the World Economic Forum this, you know, last week, but go ahead with your pink, Andrew.

B (8:14)

No, I just, I, I think it just to me, we're on the precipice of, of, of going higher in the crypto space. And in Bitcoin there's a couple data points that are macro that I think are of interest. You know, maybe two, two and a half years ago, Bitwise had about a billion dollars in assets under management. They're now on the precipice of 16 billion. That's not going to slow down anytime soon. It's going to be very, very interesting where Bitwise is as a company and assets under management, in three to five years, it's going to be orders of magnitude bigger than they are now. So that tells you something about retail demand and that we've just barely pricked the end of a finger in terms of retail demand here. Secondarily, traditional markets are either at or near all time highs. Right? So you know, there, there's this world in which we live where we, you know, where everybody's focused on bitcoin and crypto and we're down 41 and 40 here and for, you know, and it's terrible. Everything's terrible. Are we going lower? Everybody thinks we're going lower. And then there's the other 90 of the world. They're like, what are you guys talking about? Like the S P's, you know, you know, potentially going to set another all time high today, another intraday high yesterday. It's, it's extraordinary the dichotomy associated with where we are in traditional markets and the crypto space. And then third, you know, we're, we're about to get a new Fed chairman, right? And that Fed chairman is going to be a bit different than the current one, right? So the, the political back and forth, the animosity, the I don't want to do what you want me to do stance, being very, very, you know, fairly transparent at this point. That's going to go away, right? So we're going to have a world where rates are significantly coming down, assets have stayed at or near highs. At some point, Bitcoin is going to catch up. Bitcoin always catches up. And oh, by the way, not only does bitcoin catch up, but it races past traditional markets. It always does. Like for deck a decade it has. So that's the reason why you don't see in a 40 drawdown. Thank you, Tillman. The likes of Blackrock and Larry Fink like backing off on their commentary. Right. They're not scaling back and saying well maybe we shouldn't launch this product, maybe we should hold off on that or maybe we should stop talking about tokenization because you know, the people on crypto Twitter don't want to talk about it or don't want to hear about it because bitcoin, none of that is true. Like 0% of that is true. They're forging ahead and you know, it's just, do we have the ability here in crypto Twitter to see it further than this far in front of our faces?

A (11:00)

Okay, so we don't even need to conjecture. And Bill, I sort of asked you this question before but Andrew just made the great point that we're going to continue to see an increase in adoption, increase in assets under management. You have the data, you do this right. So I mean talk about Abra's business. What's focused on, what's growing. Has there been anything that you've seen a major downtick in? Because we're in a bear market, I could tell you that, you know, YouTube views go down and Twitter engagement goes down, but the people with big money actually care.

C (11:31)

Yeah. So look, our AUM was up 4x last year for our new business. So you know, it's all moving in the right direction. It's combination of people generating yield on stable coins, on, on, on bitcoin, on, you know, just staking. We've got a looping service on Solana that basically gives you like 2x the staking yield. And so all of that has generated significant deposit volume for us over the past year. The fastest growing still remains the lending piece where it hasn't caught up to yield. But the rate at which new clients are coming in on the bitcoin backed loans is outpacing the growth now in anything related to staking, although the staking business is still larger. But that all basically purports that people want a safe regulated place to do these things.

A (12:23)

Right.

C (12:24)

We're not an ETF company, we just deal in separately managed accounts. So I think you're going to see kind of a bifurcation between kind of retail simple, I want my ETF and people who are more sophisticated who are holding the underlying which is still 85% of the market by the way. Right. So I think if you look at crypto market cap versus ETF holdings, it's actually, it's probably a little bit higher now because Altafone, but it's, you know, it's no more than like 22, 23% of crypto is in exchange traded products, the rest is in gender line, you know. And so we're still seeing significant demand there. And you know, we just launched a yield bearing stablecoin USDAF which you can now get through Abra and will soon be available in the next couple of weeks to retail. But it's the first yield bearing product that you can get in the U.S. because these are basically, you know, it's an SEC registered RIA underlying the, the accounts that we use in the U.S. so, so, so there's a lot of innovation happening not just with us, but I mean I'm seeing like a lot of it really interesting stuff in the market right now across the board. You know the, the amount of defi adoption happening by CFI companies is just awesome. And it's still obvious and the reason why it's obvious it's still a hangover from what happened last time where nobody wants to trust CEFI lending anymore and they shouldn't. Why should you if you can basically get your arms around this technology and trust that, you know, so, so I think we're just at the beginning of kind of a DeFi 2.0 cycle which is going to be massive in my.

A (14:08)

Yeah, sorry. I find that so interesting because the immediate effect of the collapse of CFI was basically a black mark on Defi because people didn't understand the difference. And so Defi saw this massive downturn. Now what we all dreamed about was hey, Defi hummed along nicely, liquidations were orderly, nothing broke. This should be the case for Defi and maybe it's taken three or four years, but it seems that certainly a regulated or with a professional managing the way that you engage with Defi that that is the natural way. I want to ask you one more question about the yield products. Obviously with a drawdown from 126 to 74, I would imagine that there have to be some margin calls or people that are needing to at least add some bitcoin. I mean what did the market look like? I think it's been slow enough that if you didn't see it coming and got liquidated, shame on you. It's not like silver. If bitcoin had gone 126 to 75 in four or five days, I think that would have been, been pretty savage. But so yeah, so.

C (15:09)

So we don't really have the kind of what you would call D gen client. You know, if I refer to, as a matter of fact, my average client was here and I use the word dj and they'd be like, bill said dj and, and so, yeah, like, we don't. That's, you know, our clients are coming in at like 25 to 35% LTVs for their loans for the most part. And so that gives you a pretty good cushion even with a 40% or 45 drawdown. And then, you know, if you have to top up, you do. But you get so much warnings from our system. It's, you know, I, I don't, I haven't heard any liquid of any liquidations across the board. We get people who say, I want to pay down the loan so I can get the collateral back. But that's planned. But yeah, so, so we're, we're more of the, you know, please start with a 25% LTV kind of service and not the, you know, let's go DJ and broke kind of kind of service.

A (16:04)

I'm a customer, right. So I know that that's not. Not telling you lies as absolutely the case. And you guys don't let anyone get even remotely close. Right? So, yeah, no problems there at all. I mean, I didn't take a loan at 126 grand. Maybe, you know, things would look a little different, but, you know, just add a little bit. I mean, Andrew Tillman, like, you know, hearing him talk about the, you know, the, the pros, the basically the trajectory of the market and price not mattering because all we hear about is that, you know, price is down, everything's dead. Sounds like that's not really the case.

D (16:41)

Yeah, well, I mean, I think Andrew touched on all the traditional finance reasons and kind of the adoption reasons from a macro perspective. But I, I really find a lot of solace in the nuance and some of the nuances Bill mentioned is, I think, just a absolute game changer in the industry, which is this integration of DeFi into the central exchanges. And I don't think people really understand why. But let me break it down for you. It's like DEFI is incredibly scary. The interface, the user interfaces are very messy, they're very congested, they're not user friendly. And if you mess up, you lose all your money. And so it's a very scary place to go. And only the quote degens of the space really like to go in and try to figure those, those systems out when you're talking about a central exchange, most of what they spend their time on is user interface. Like that's what half the battle is, is just trying to make it easy. Because blockchain has traditionally been very hard to interface with over the last 15 years. And so to make it easy means you make. Because most people don't have the bandwidth, they don't have the time, they don't care enough to spend hours to educate themselves on cold storage, wallets versus Hot walls. Like all that stuff doesn't mean or never will mean anything to them. But when you can log on to your brokerage account, I. E. Abra and you can, you can interface with it in a way that gives you flexibility, allows you to earn money, allows you to borrow money, all of those things again done at a central level creates a management nightmare and an overhead, you know, burden that most central exchanges don't want. But if you can plug and play a defi protocol into that user interface, it's an on ramp now that allows the normal person to experience defi and what the value proposition really is. And the value proposition is the same thing that we love about blockchain, which is fair and equitable rules that are set kind of out for public consumption, public scrutiny, and then set into motion in the form of a market and the rules of that market. And in that smart contract and those rules, they don't have emotions, they're not human beings, they're not somebody on the other end that's a clearinghouse. And this is a great example of why defi is so pertinent in this day and age. If you try to sell silver right now, good luck getting a price anytime soon. Good luck getting your money anytime soon. Why? Because there's this backlog in refineries that has to process all that silver and they, they don't want the head, they don't want to hold the silver on their own risk and their own dollars. So they won't quote you until it's that you, you're up to bat essentially. Well, in the defi space in when you have dealing with smart contracts, that liquidity pool that you need to cash out or interact in a way financially, it's there 24, 7, 365. No human being has to sit there on the other side and stir a pot or do anything. It's just all instantly settled essentially. And not instant, but as close as humans have ever gotten to instant, that once you've experienced it, you'll never go back. And I think it's incredibly smart of all of the central exchanges and pretty much anyone that has a user interface that can tie DEFY into that, I think it's incredibly smart because I think that on ramp will be used. I think it's a very valuable on ramp for not only our industry, but really for the people because it's going to show them a new system that's not predicated on bias and, and on essentially gatekeeping. It's, it's predicated on you just having the, the native token that can interact with the protocol. That's it.

C (20:45)

Yeah, I think we're really close to not talking about DEFI anymore when it comes to the kind of services that we offer. Right. It's just banking and it's just finance and the assets are digital assets. Right. So later this year we'll be offering any kind of asset because they're all going to be tokenized anyway and the account already supports any tokenized asset. It's just an NPC wallet. And so at that point you're going to be borrowing against Apple shares and tokenized real estate just like you're borrowing against Bitcoin now. And the fact that it's defi, it's not defi, it's just technology. When I was a kid we worked on the west coast peering point for the Internet at NASA, which meant we managed the Internet on the West Coast. You had to know the innards of network programming to do our job. Right. Like today we have to know the innards of DEFI protocols to do our job. And so I think we're getting to a point now where the complexity of that is about to become totally hidden to this kind of next generation of just users. They're just banking users.

A (21:54)

Bill, along those lines, what percentage of your customers would you say actually ask those questions anyways? So I know obviously you're abstracting away DEFI entirely right now it's bitcoin based loans. It will be everything tokenized. But how many people are like, are using aave, you know like are actually asking what defi protocols it's in, what the mechanics are. I mean I asked right? But like very few.

C (22:18)

Yeah, so, so they look at the risk disclosures, you know, because we have an ADV that you can read and it's like any other RIA but, but very few come back and say okay, like explain this about Abiy protocol. They'll, they'll ask in high level terms okay, what are the risks? But, but that's the same as when we were doing just only CEFI loans. Now we Offer both. Today we offer both CEFI and DEFI loans. They generally look at the rates, look at the LTVs and go, okay, I'll take, I'll take your default, which is defi. And, and you know, every once in a while if it's an eight or nine figure loan like in a family office, wants to dig in to risk protocols and you know how everything works, then we'll have a protracted discussion. But even then they'll, they'll end up choosing by and large the, the technology risk as opposed to the corporate counterparty risk.

A (23:11)

I just want to point something out. Circling back on the how much has the downturn affected people's business? Well, it hasn't been great for exchanges. I actually wasn't paying much attention but crypto exchanges buckle as stock losses mount amid Exodus. Obviously share prices down 40, 60%. I think I saw in one of these articles the trading volumes were down as much as 80 or 90% on some of these. But you can take a look at Coinbase Stock obviously topped 440, trading at 187. I had not ever taken a look at these etoro. I mean topped it. 80 bucks was kind of the first. It's trading at 28. Bullish. These things are making all time lows right now. So not all roses, puppies and unicorns.

C (23:56)

Circle's gotta be down what 70, 80% from, from its highs at least I.

A (24:01)

Would guess Circle below. I know ip, IPO price. It's actually an interesting conversation. Maybe the next one we should have. I have a great tweet by Dan Tapiero, you know, friend, friend of the show, as we say. Basically saying like this is the time to buy Circle. Right. Circle stock is 80% from it down 80% from its peak seven months ago. And last year total trading volume of stable coins was 33 trillion. Now in January, loan stables volume was 10 trillion and USDC was 8 trillion of that in one month. Right. So TAM of pay will be north of 1000 trillion is what he's saying. I love Dan and his big numbers. He's amazing at it. But yeah, I guess there's a push and pull between transaction volume and interest rate risk. Right. So like I don't know how much percentage of Circle's revenue is transaction volume. Maybe Bill, since you're working with, you know, you have a better idea. But I'd have to imagine that, you know, getting 1% on your treasuries instead of 4% is going to be a big problem for publicly traded stablecoins.

C (25:00)

Yeah, Circle's a narrative trade right now. Its business model is just because of how much revenue goes to Coinbase, the fact that treasury rates are coming down, it's a little suspect. But if the crypto narrative picks up, I'm sure Circle will get that trade for at least a while. And then I think eventually it's going to be about fundamentals and the quarterlies. But right now I think it's a narrative trade and I think the narrative is confused about the whole stablecoin yield vis a vis Clarity act or lack of Clarity act discussion. And you know, look, we're looking to go public this year. You know, hopefully we'll have something more to say very soon about it and you know, it's all moving in the right direction. But, but honestly, I would rather be going out now and have a. And if I, especially if I was putting my treasury in crypto from an ipo, you know, I was in one meeting, I can't say who, but well known person was like, man, I wish you guys could go out now because if you could buy this, just put this on your treasury at like 70k, that would be amazing. I said, yeah, but I don't think that's going to happen. So, you know, I wish you would, but you know, I'd much rather be buying treasury at 70k than 125k.

A (26:19)

Yeah. Andrew, before you jump in, Bill, I just want to say we talk about the Clarity act. It's our topic every single day. Stablecoin yield. And they're all like, the banks are lobbying. No stablecoin yield, we don't want that. And you're like, hold my beer. Yeah, United States how?

C (26:38)

Yeah, it's, you know, figures doing it. We're doing it. There's other banks that have figured it out. We're not a bank. Coinbase is still paying their rewards.

A (26:47)

What's the problem?

C (26:49)

So you know, just do your jobs and, and get on and get, get something good passed that, you know, deals with the issues. We need a moat from the last cycle. We need a moat from the Warren Cabal not returning. That's the most important thing right now. All this other stuff, to me, it's great to. It is important to dig into the details in the sausage factory and all that stuff. It makes sense to me. Do, do your job, but, but build the moat. That's what, that's what we were promised more than anything else. I don't feel like I was promised clarity around Bitcoin based or dollar based yield. I feel like I was promised a Moat from the not happening again. That's what I want. And, and so get that done and we'll all be better off for it.

A (27:35)

Andrea, you got a million.

B (27:37)

You know, the data about exchanges and trading activity, you know, traditional brokerages went through this, you know, 25 years ago when for all intents and purposes, they basically shuttered their, their, their trading desks in large part. And then they, they separated themselves in terms of being beholden to the moves in the market to, to, to generate revenue associated with just retail trading. And so they went to wealth management type of, of models. You know, Morgan Stanley used to be a, you know, a huge global investment bank and that's where they got all of their business big trade desks, both on the equity and bond side. All that stuff is now, let's call it 20% of their business and nearly 80% of their business is now wealth management fees that just recur and recur and recur because all of their advisors are charging anywhere from 25 bips to 125 bips for every account that they work with. So crypto exchanges, there's a reason why they're all rushing into prediction markets. Right? Because they're trying, yeah, they're trying to replace the trading that happens associated with the movements in crypto and bear markets and, and sentiment and all that stuff. So they're doing. Yeah, so coinbase predict, right? Yeah. All Gemini ever talks about on Twitter now is, you know, look at our prediction markets and you know, Robin Hood too. Yeah. So they're just trying to replace the type of activity and revenue that is very, very fickle. Extremely fickle. Just by the waves of the markets and, and more, more so sentiment than anything else. We could have significant upside. You know, we could go from 75 to 95 or even 105. That may not remarkably change sentiment and increase fees associated with trading in a huge way. Because sentiment is a difficult thing to shift. So these organizations are trying to find their way to adjust revenue models or else it'll be a really, really tough slog for the next, let's call it 24 months. On top of that, though, I do expect over time in the same way that online brokerages significantly consolidated over a 15 year period because everything moves faster now and certainly crypto moves fast, faster. I think there'll be consolidation over a five to seven year period across crypto exchanges that try and try and try and you know, and then a couple, three or four get bigger, lots bigger than the others. And so, you know, they eat up. So we'll see what that looks like. You know, I, I, I'm a big fan of all the exchanges that I think they've got great people doing great things there for all the right reasons.

A (30:29)

Good people on both sides.

B (30:31)

Yeah, but, but, but there's a reason why Coinbase is super focused on, you know, their, their yield business and, and other businesses that are somewhat detached from just trading. You know, there's a reason why smart people, they're doing some smart things.

A (30:46)

Yeah.

C (30:47)

I think Coinbase wants to be Chase, and that's what scared me. I don't think Coinbase wants to be what crypto heads call Coinbase. And that was readily apparent in Davos. He wore it on his sleeve and now he's getting hammered by it because they have a voice and an audience.

A (31:10)

Right.

C (31:10)

And so that's why, in my opinion, and I don't really care, like more power to him, I fall more into the wealth management bucket that you were talking about. I think that's the future of crypto as it relates to banking, decentralized crypto. And so to me, what they're doing isn't really crypto anyway. It uses some of the pieces, but they're just trying to go after Chase's business, and Chase is basically going to treat this like a fight to the death, as they probably should if you're a shareholder of, of, of Chase, I suppose, and it's pro. You know, the difference is, is that there's two different moats, right? There's, there's the moat that allows you to lend the same dollar six times, which, you know, they basically say, hey, I'm allowed to lend the same dollar six times, so these guys shouldn't be allowed to pay yield, which doesn't really make sense. Right, that's what they're saying, but it doesn't really make sense. But, but the reality is, is they're all going to be directly competing with the same retail customer. And that consolidation is probably even more important than the crypto consolidation or the exchange consolidation you were alluding to. Because I've been saying that the exchange consolidation is coming for eight years, and so far it hasn't come. I keep saying spreads are going to compress, fees are going to compress, and they just don't. I believe you. I actually think the same thing, but I've been thinking it over and over again and it still doesn't come.

D (32:31)

I, I think that's why defi is so important, though. Or, and whether it's hidden or whether it's acknowledged, you know, it's just like bitcoin. Bitcoin set a standard that couldn't be ignored. And the standard was etched in stone and everyone had to adjust to the standard. It doesn't move with the wind. Bitcoin doesn't care about any geopolitical stuff. It's a mathematical code that keeps marching forward every single day based upon natural law. And defi is that too money should be that way. Humans inject friction into money flows and this is a removal of humans. That is a good thing that cannot be stopped. Whether slowed down, whether the timings off. All of those things you can bet on. And they're good bets. I'm betting on them too. But it's inevitable. The cat's out of the bag. The technology has been created. It would be like us trying to go back, you know, in time after the combustion engine. It doesn't happen like that. It's, it's, it's. We, we understand it now. It's too powerful is the point.

B (33:36)

So I saw a stat Caitlin Long put out a post, I don't know, a couple days ago last week at some point that showed that in bull markets, and I don't what constitutes a bull market. That's the question here. But the stat still stands in bull markets. 100 of the move of the money that moved away from traditional markets in traditional banks into Coinbase didn't return back. It stayed there. Right? Stayed there. That's the reason why Jamie Dimon is, you know, screaming at, at Brian Armstrong.

A (34:09)

Davos be more concerned with being Epstein's banker.

B (34:14)

You would think, you would think, you would think that that would be of, of interest to him. But the reality is, you know, to, to Bill's point, you know, Coinbase is an absolute behemoth. And they, they have, they have been smart about using that scale and not, not slowing down. And so it sounds crazy to most people to, to that JP Morgan should be concerned about Coinbase, but they are. And you know, Coinbase has 120 plus million customers and JP Morgan has 82 million.

A (34:51)

So what did I miss? I literally missed the Jamie diamond yelling at Brian Armstrong that like, perceived.

D (35:00)

Yeah, well, they all have because Brian was on stage. And the clip that made kind of the most viral clip that I saw of the entire event was Brian educating somebody about the fact that Bitcoin had no issuer. Yeah. And that there was. And, and I think, I think it was in that, that spirit of irreverence and that spirit that, you know, Bill was talking about him wearing on his sleeve he, he, he came in there with, without any apologies, without any, you know, excuses. It was like, I'm here and this is changing the world and you guys better get on or you're going to get run over. They don't like that type of, you know, bravado. So, you know, you're going to see pushback. It's a lot of egos in that room. A lot.

B (35:49)

I mean, yeah, it was, I mean, you know, there's, there's JP Morgan CEO publicly cursing Brian Armstrong at Davos is in the Wall Street Journal. So, I mean, yeah, it said you're full of diamond said to him.

A (36:04)

So.

B (36:04)

Right. I mean, when it gets, when it bubbles over like that, you know, there's, there's probably stuff that's gone back and forth.

C (36:13)

Right? Yeah. That's a message to shareholders as much as it is a message to Brian Armstrong.

B (36:17)

Sure.

C (36:18)

You know, at the end of the day. Right. Like I said, Brian Armstrong, I like Brian. We know each other. It's, it's, it's not. He's not trying to be a good steward of the crypto space. That's not why he's doing what he's doing. Right. He's basically trying to compete with Chase on his own terms without having to basically be regulated. You know, Chase has an army of OCC and FDIC people on site. Okay. Not that oversee them from afar physically in their headquarters that they live there. That's their job. Coinbase doesn't have that. So, so they don't want that. But they want the benefits of what it comes to pay, yield and, and, and, and defi. And all the lending and that's what they should want. Right.

B (36:58)

Why would you win the ball where it lies? Right?

C (37:00)

Right, exactly.

B (37:01)

You play the ball where it lies. Brian has some advantages right now and there's a reason why the OCC and FDIC folks are sitting there in J.P. morgan. They, they've, they've paid a few fines over the past couple decades. Right. Just a little bit.

C (37:14)

When you say money six times.

B (37:16)

Yeah.

C (37:17)

And, and the, the kind of, you know, lender of last resort becomes the fdic, or the acquirer of liabilities of last resort, to put it exactly, is, is the, is the American people. They probably should be on site. I don't like that business model and it needs to die, but we, but it hasn't died. It's still the business model we have. And so they need to do their jobs. And, and that's Jamie Dimon's biggest problem right now is, is that he's create, they are operating in a different playing field, right? But Brian is able to market similar services. He's doing loans, he's, he's paying yield and it's not going to change. There's nothing that's going to come out of this Clarity act or any banking rules that's going to change any of that. We're going to keep growing our lending business. We're going to keep growing, keep growing our yield services. We have a yield bearing stable coin now. It's not going anywhere. It operates within a, you know, both legal frameworks inside and outside the U.S. and you know, isn't that a good.

D (38:15)

Thing for crypto though? Because it sounds like the field is so sloped towards crypto that eventually, you know, you know, Jamie diamond, forgive me, but you know, he, he's at a different stage of life than Brian Armstrong is.

C (38:30)

This is a conversion about, right, because you've got all this fourth turning, you know, happening at the same time, right? Of why is gold volatility? Gold is at the same price right now, it was last Thursday. But the volatility, you know, over the last five days has been what, 30%, that's, you know, at least 20. That's crazy. Something is breaking, right? And, and what's breaking is, is the old world order. And then when you go from the old world order to the new world order, fractional reserve banking is going to be one of the first things to go because people don't trust anyone anymore. And that's a good thing. People are starting to ask questions, hey, what's under the hood here, right? Why they don't trust institutions as it is anymore, right? And so as this migration away from, you know, dollar hegemony towards a new world order happens, governments may start to print money to buy more gold, right? To reflate the gold, right? So, so who are they going to trust? Well, probably the crypto banks that, you know, can show where their assets are in a vault and you can borrow against the value of what's in your vault, right? And that makes more sense to me than saying, oh, here, here's give me your dollar. Okay, great. Here, you can have a dollar back. You can have a dollar back. You can have a dollar back and you can have a dollar back. That doesn't make sense.

B (39:56)

Bill's point about Jamie saying that, you know, Brian Armstrong is, is, is more so to his, not only his shareholders, but his customers is spot on. Right? Because what's Jamie trying to, to project like, hey, you shouldn't do business with Coinbase, like if you've got money at Coinbase, get it off of Coinbase. If you're thinking about putting money on Coinbase, don't go there. That's what Jamie is trying to. And so that's a, that's a well thought. Their bill, I mean, apparently, right, they have the data associated with the amount of, of capital flight that is moving in that direction. So no question they're, they're concerned about it. Of course they are. They have to be. Have to be.

A (40:45)

I mean we have, we have the video here. I mean, I didn't realize that. See, I somehow missed this. I feel like I'm on top of the news. But apparently he was like right in his face waving his finger at him and telling him he was full of shit on tv. I didn't realize that, but this is why he was so mad. This is what, Brian, we have the one minute video. Let's just watch it really quickly. I know, Bill, you gotta go to.

E (41:01)

A couple minutes giveaways to TradFi. If I can say that our view is that there should be a level playing field for this is allowed. This is not allowed. And then all the US companies compete and banks didn't like that. They were, in my view, the commercial sides of these banks are very smart and the CEOs get it. And they're talking to us about integrating crypto. The bank lobbying groups and bank associations are out there trying to ban their competition. And I have zero tolerance for that. I think it's un American, it harms consumers and the banks need competition, they need to innovate. We also saw this from some of the securities broker lobbying groups because tokenized equities are a big thing happening in crypto. So there was three or four kind of red line issues we saw in the draft text. And as I was in D.C. that day meeting with members of the Senate, I asked them, okay, is there a path to fix this after it comes out of committee? And they basically told me behind closed doors, if this comes out of committee with a bipartisan vote, we can't really help you on the full Senate floor. And so I felt like I had to stand up and say something defending, defending our customers rights. And I was careful not to opine on what the Senate should do in terms of a markup or not. And I was careful not to say anything. We don't represent the whole crypto industry. But from a Coinbase point of view, I was not comfortable with the draft text as written. And I'm glad that everyone came Back for another round of negotiation.

A (42:21)

Yeah, you. You bald guys are beautiful, man. Yeah.

B (42:25)

I mean, what in the world did he say that was terrible. There's nothing about that that's terrible.

A (42:29)

I mean, he said. He said the banking. I mean, he said it really calmly and whatever, but I mean that.

D (42:35)

Shots fired at the professional CEO right there. That's what you want to see.

B (42:40)

Yeah, it's.

C (42:41)

It's, by the way, clarity from through obfuscation. Because he is completely full of. But, you know, it's. It's okay. It really is okay. It doesn't really matter, you know, so.

A (42:53)

Oh, you need to shave your head if you're going to be a crypto CEO. I'm sorry.

C (42:56)

Yeah.

D (42:58)

As long as you can, Bill. This is not my choice.

A (43:04)

And it was beautiful. I've heard that. Go ahead, go ahead.

B (43:11)

The George Costanza look would come back. I could really pull that off. You know, I really.

C (43:16)

Yeah, you guys can pull it off. I'm not going there.

B (43:19)

I'm gonna fight to the death.

A (43:21)

Serve me. You and me both, buddy. You and me both, Bill, man. Anything else? First of all, anything else we missed before I do let you go?

C (43:28)

I know it's a great discussion. Smart gang here. Honored to be part of it. And look, I think we're in for some fun times the next few months. Bottom line is, I think asset prices are going up. Might be actually with a stronger dollar, which we haven't seen for a very long time. And that's only because it's a race to the bottom with the other fiat currencies. Not because the dollar is doing anything special, but other than that, I think we've really. We've covered it.

A (43:54)

So.

C (43:54)

Good stuff.

A (43:55)

Thank you, man. Bill, always a pleasure. Everybody. Obviously, check out Abra and Bill. I know we'll have you back very, very soon.

C (44:01)

Look forward to it. Good to see you guys.

A (44:03)

Appreciate it. If I shaved my head, man, it would be so bad. No, I used to have to, like, you know, shave it on a one thing, but I have that thing that you get in the back where there's. You look like a Shar Pei. Yeah, yeah, yeah.

B (44:20)

Yeah.

A (44:21)

I don't wanna.

B (44:21)

You know, there's a lot of jokes coming to mind if you were to shave your head that are probably of our audience. You know, you could probably an extra. Be an extra in some movies, but I, you know, I'll leave that to the imagination of.

A (44:35)

Whatever, man. They don't make those movies anymore.

C (44:40)

Clips on it.

A (44:44)

I would like to point out very quickly that not everybody is fearful and terrified of the market or of shaving their heads. I'm trying to bring it up. Here we go. Wait, here it comes. Yeah. Cathie woods buying everything. You almost got me into a room with Cathie Wood this week.

D (45:03)

Yeah, close.

A (45:05)

Close to no. No cigar.

D (45:06)

No cigar.

C (45:07)

Yeah.

A (45:08)

But yeah, she bought Circle Bit mine, Bullish Block, Coinbase, everything. We basically just mentioned she's buying the dip on. It's a perfect segue to talk about who else is buying the dip and that is me with all of your beautiful bald algorithms. I mean, I bought this thing. To be fair, we've bought everywhere, but we bought the dead ass bottom and way more aggressively than it had been buying before because it caught me on the 6 hour, the 12 hour, the daily across all of the assets. It was beautiful. I mean, executed just above 74,000. I know. It bought at 78, it bought in the 76 area. It bought Solana, like sub 100 I think for me. Or right, right around there. Love it.

D (45:53)

Well, if you're looking at, you know, we talked about it earlier is, you know, why is Everybody that's down 90% down 90% was because they have no more dry powder to re buy. They're not managing their purchases. They don't have any strategy as it pertains to. That was a pun intended, by the way. They don't have any strategy as it pertains to actually dollar cost averaging into those, those positions. It's just smash by and I get why and blessings to them. I mean they've shined a big spotlight on, but kind of for all the wrong reasons, in my opinion. It's like bitcoin's a safe haven where by which if you want to own Bitcoin long term, you should be exposing yourself to as healthy of a cost curve as you can. What does that look like? Well, it looks like buying all of the dips and when you see an aggressive move off of price both to the upside or to the downside, there's a high probability that there's a mean regression play that can be harvested and there's some volatility that can be harvested there. And so if you have those lines set and you have, you know, essentially those strategies deployed within the software, then you're going to be able to take advantage of those whether they happen in the middle of the night or, you know, in the first part of the day when you're taking your kids to school. Like the market doesn't care what you're doing. And so this gives You a convenience factor of setting those, you know, parameters before you have to be there at the computer to execute them, no emotion involved. And that's the way in which you accumulate those assets at the best price is through a, a tried and true dollar cost averaged, but intelligent dollar cost averaged approach, kind of dollar cost averaging at its rudimentary state is just Every Tuesday at 9am I'm going to buy a little bitcoin. Well, that's fine, but you're blindly going into Tuesday. Tuesday could be a giant upday, a giant down day, a flat. You're not using any market indicators to pick Tuesday, if you will. Our algorithms believe that market conditions are a gift. The volatility is a gift. And if you set the conditions of the algorithm to take advantage of that volatility, then you reap the benefits of that gift. And so that's what our tool allows you to do very successfully. It allows you to do it without emotion. And it's got this last move. The reason why you had triggers through all of those time frames is because it was a very big move in a very small period of time that stayed below that closed all those candles below.

C (48:30)

Yeah, yeah.

A (48:31)

I mean, I, I can only tell you that I have about 12 minutes a day to pay attention to the market. I barely even can stay on top of bitcoin price anymore just because of, of life. Right. And so, yes, that, that doesn't exclude the possibility of dollar cost averaging every Monday at nine. Passively. Right. I don't need to be watching the market to do that, but I'm obviously somebody who wants to participate with better timing. Not perfect. I didn't wait to deploy my entire stack at 75. Right. I can guarantee you, by the way, if strategy had used this tool since the, since the highs, there would be no articles about his cost basis.

D (49:10)

They would have a lot more bitcoin, a lot more bitcoin. And that's the point is accumulating bitcoin should be a strategy. And that strategy means you need to respond to market conditions and buy on the depths and manage your cash to where you always have powder dry to deploy. Because bitcoin, you know, if you, if you think this is the bottom and you deploy 100 of your capital here and it goes to 50, you're, you're going to be waiting for a long time to get back to even. Whereas if you deployed even a third of your capital here and a third at, you know, 60 and a third at 50, your cost basis now is a lot lower, significantly half as as high as it was in the previous example. So it's one of those things where the math is on your side so you just take advantage of it.

A (49:58)

By the way, like we started with a certain size portfolio and I quickly realized that if I deployed as heavily as I wanted to, that wasn't going to be sufficient to do what I wanted to do. So I, I will just being honest, I didn't approach it saying like I have a very fixed amount, which I think a lot of people do. Right. Like I, you know, I have a hundred grand that I, that's it. Right. Mine was I'm just gonna keep buying. And so I've just continued to add, add, add, add, add and bring my cost basis down. I'm not sure everybody would have been able to do that, but it's been.

D (50:26)

Well, everyone should be able to do that. Yeah, that's the point of our fund. For example, future fund. One is to, to, to highlight this feature of Bitcoin being a savings account and, and not a highly leveraged, you know, financial tool or piece of pa. Yeah, hedging. It's just as simple as take what you can afford to save every month and use, and use our algo to incrementally use, deploy that capital into Bitcoin. That's it.

A (50:57)

You articulated that so well because that is my view. I'm not viewing this as like should I buy Bitcoin or put this money in savings? I buy Bitcoin with the money that I would put in savings because Bitcoin is my savings account that I want to grow, grow.

D (51:11)

If you have a long term perspective on your savings and it's not a cash that you're immediately having to tap into, I think Bitcoin has proven to be an exceptional place to save your money in an exceptional one. So that is, that is what your conviction is. And the software is helping you do that better than you could do it yourself. And that's the reason why we're seeing, the response that we're seeing, that's the reason why we're starting the fund is that there's a lot of need for, for these tools. There's a lot of need for a prudent, very managed approach as it pertains to building your schedule. Treasury management is a heavy liability. And you know, just like we were talking about with bill, deploying loans at a central level without defi being integrated is a very liability laden endeavor. Volatility is your enemy because you're taking positions as the market maker, as the, the lender if you will. And those positions have a high degree or a low degree of default at these levels and a high degree of default at these levels. But when you go into the high degree of default zone and there's a liquidity crunch, if you aren't positioned well, you could be in a real bad situation where you're a forced seller. And that's what we're seeing in kind of a way with these treasury companies, is that they haven't managed their deployment of their capital except very well. And so now they, they can't raise more money, and their cost basis is way up here. And so they're just stuck kind of in the seventh circle of hell until Bitcoin goes up in price again, which it probably will, and they'll be fine at a certain point, but each one of those companies will live and die on a cost basis that's fixed on a very steep curve, both sides. Whereas if you take excess income and you apply it to bitcoin, that's savings, that's not money that you're expecting to draw down anytime soon. And so you can wait over time and, you know, over time, Bitcoin has proven to be, again, the most exceptional vehicle for saving that, that exists.

B (53:19)

So on Monday, you know, Sailor and strategy announced that they bought, you know, a bunch of bitcoin. And then basically for most of the day yesterday, everybody clowned them because they bought it at 87,000. Thousand, almost 88,087. Nine. Right. So Scott Melker uniquely outperformed Michael Saylor in his purchasing of bitcoin.

A (53:40)

Not in life.

B (53:45)

To the tune of, you know, nearly 4 to 12,000. 12,000 per per purchase. Right. I mean, that, that's a huge, huge number. So, you know, in terms of, of the tools and what they do and how they work and how you benefit, again, you uniquely outperform the, the biggest player in the market. 88, 000 is what he bought it at. You could have done it in your sleep at 74, 76 and 77, 000.

A (54:14)

Yeah, he did.

D (54:15)

In his sleep. And what, what does that equate to? It's a buy six, get one free discount, basically. Like, you literally, you're, you're, you're, you're multiplying your stack at a rate that. You talked to me, you know, on one of the calls, and he said, I, I don't want to ever sell, so I don't want to do the arbitrage algo. I'm not a seller. I want to accumulate Bitcoin forever. And ever. And I said, well, at any given point in time, how much cash do you have available to buy the dips? And he said, none. I'm 100 allocated all the time. And I said, well, the dips are where the anomalies lies. It's where the biggest opportunities lies. Lie. If. If I look at housing market and it's. It's this kind of static thing that moves this. If. If tomorrow my neighbor was selling his house for 100 grand, if I didn't have that hundred grand to deploy, I would be missing out. The opportunity cost of buying that house would be in the millions of dollars. Well, same thing applies to bitcoin. Your opportunity cost is literally the very best feature of bitcoin from a volatility perspective. This. Yo, yo. That it does. And it does it exceptionally well. If, if you're not taking advantage of that, if you're not keeping powder dry to deploy it at those dips, you're literally leaving the best feature on the table. You're not utilizing the. It'd be like you seeing me ride a bike around town, but never touching the pedals. Like I'm just pushing with my feet and coasting on the bike. And you're like, hey, man, that, that. Those pedals will make you go a lot faster. Volatility will make you look a lot faster. If you look at the buy and the hold of this, last year, 2025, you had a negative year in bitcoin. If you played the volatility, you. You made 25 plus percent. So it's this delta that allows you this additional advantage on top of what bitcoin already gives you, which is as potent as anything, any vehicle out there.

B (56:22)

By the way, if you want to know what it looks like for Tillman, riding a bike through the neighborhood, just.

D (56:28)

That's what I do.

B (56:29)

Go watch the movie Friday and watch Debo ride the bike.

D (56:33)

Yeah, that's exactly what I was envisioning. I didn't know the movie or the character, but I was thinking of.

A (56:45)

Give me that change. Give me that change. Runs away like the dude Red. Running away with arms is like my favorite thing ever.

C (56:55)

Yeah.

A (56:56)

God, Debo, man. Yeah, I love it.

D (56:59)

Hey, one of the things.

A (57:02)

That's the actor, in case you're wondering.

B (57:03)

Yeah.

D (57:05)

Is that what his real name is?

B (57:07)

Yeah.

A (57:07)

Zeus Lister. Rest in peace, Tiny.

B (57:14)

Yeah.

A (57:16)

Anyways, you were saying something.

D (57:17)

I just was gonna say Abra was Bill. And Abra have been around this space for so long. And what he was talking about is incredibly valuable. It was one of the best guests that we, we've been able to talk to in a while. And I'm going to dig in to what they're doing. But I really do believe that, you know, forget the prices for a second. Forget. Just set your, set your long term goals. Like one of the things that I think is appropriate for everyone to do is really ask yourself, okay, where do I want to be in my Bitcoin or my Solana or whatever it is, my crypto journey a year from now? I want to own X number of Bitcoin or I want to own X this. I want to and set that goal. Use a software to help get you to that goal. And forget all the chatter, pay attention to the people like Bill who have an inside look at the volumes and the participation and the innovation and the integration that's happening in this space and take solace in the fact that they wouldn't be building that unless there was an extraordinary demand that was showing them a reason to build it.

A (58:28)

Right?

D (58:29)

And so the people have spoken, the cat's out of the bag. Crypto is here to stay. And so whether your allocation is 1%, whether it's 3%, whether it's 15%, whatever it is, come up with that goal and then be mindful of our tools. They're free for you to use to get you to that goal. And that's really what it's all about, is helping people to at least get off the snide and participate in the game that we love so much. Because it really does. It'll change your life for the good.

A (59:02)

A really important point, by the way. Everybody who would potentially start this now has a humongous advantage over me. And it goes back to what Bill Barheid said. He said pump starting a company that's going to have a Treasury on the balance sheet. I want to start at 75, not at 120. I started the day the market hit the literal all time high and I still love it.

B (59:20)

It.

A (59:21)

Right, I've said that over and over again, but I know everybody gets bearish now and there's fear and now everybody's questioning whether bitcoin's going to zero. And I'm getting the texts about how it's structurally broken. All the things I love to hear, right. If you start right now, you didn't have to buy at 86 like Saylor, you're buying at 78 today. You know what I mean? Like you're getting started. We will see even if we skyrocket from here, the more volatility we get, you're going to get those 3 to 4 to 5% dips all the time that you're buying better prices even on the way up. Like, there could not be a better time to start doing this than right now. Even if it goes to 60, you're still a rounding error above that. Now at this point, after coming down off 126, well, the probability of it.

D (60:10)

Going, the probability, here's where the way I look at it, and it's just simple math, math, we're, we're at 75 right now. The probability of it going up $60,000, which it's already been roughly to that price point, or going down to $10,000, which one's more probable in your mind? That should give you an innate value proposition that, that should enact, at the very minimum, a baby step, right? Just a very small step towards that value. That, that's the way I look at it. And you know, if you look at Bitcoin from a risk perspective, this is the most riskless time that you could ever be getting in. It's already being adopted by all of Wall Street. It's here to stay. 95% of the curve in terms of the deployment of Bitcoin or the inflation curve through mining efforts have already been distributed. There is no. Is this protocol going to work? It's worked, it's done. We only have 5% left to chase over the next however many 50 years or whatever it, you know, this thing is, is solidified in concrete. And so if you look at the ratio of the price right now at 75, 000, you're almost getting two for one for your money from where the high was, from where you started. Scott. So again, yes, look at your individual, you know, investment of 1 to 3% or whatever you're going to do your allocation, and look at it from a fund perspective, Would you rather deploy the capital at126,000 or would you rather deploy it at 75? And would you want, if it went to 50, would you be happy if you had a slug of cash to deploy it there? Yes, you would. So the moral of the story is, is manage it. And we have a lot of tools to help you manage it. We can make that management very, very simple and emotionless. That's, that's why we built them, for selfish reasons, because we were tired of having our alarms go off by our bedside tables and, you know, all hours of the night because we were in the crypto markets that never slept and these markets never sleep. And the volatility, again, happens when you least expect it and not according to your schedule. So if you want to take advantage of that, you, you just have to ask yourself this simple question. Like, how many times have I heard people in the markets, in the crypto market specifically say volatility is a feature? Well, if it's a feature, how are you capitalizing on it?

B (62:37)

It.

D (62:38)

So there's the simple question that you can ask yourself. And if you want to see tools that you know are free to use to show you how you can capitalize on that, we're here to help. And our customer service is top notch. We really pride ourselves. If you call any of our, our guys, they will spend as much time with you, talking to you about software and automated trading and the markets in general. We're very passionate over here and we, we want to help people and make it easy on them to integrate these types of strategies for themselves. Because it's protocol in pretty much every major, you know, traditional space. I mean, 90 plus percent of daily volume is mostly algorithmic trading. It's not people yelling with pieces of paper in their hand anymore.

A (63:23)

Public.com archpublic.com it's right there for, for those who didn't see it. I mean, some of the comments since we started mentioning Friday, which is my favorite movie of all time. It was the only thing I had on VHS tape my sophomore year of college. That and that and Cheech and Chong up in Smoke, the only two movies that we watched on repeat. I really used to be able to recite the entire movie. So the comments, somebody said, I gotta find it. So good. I know we're supposed to leave. Melker is Smokey, Andrew is Craig, Pil is Depot. I don't know who Pinky is.

D (63:58)

I think he means Big Worm. Big Worm.

A (64:01)

Big Worm. Really funny comic.

D (64:05)

There's an AI in works right now. I think we will see a version, version of that soon.

B (64:11)

The best moment in that movie is when the girl gets out of the car with, you know, with Chris, you know, whatever, whatever his name is, and he's expecting her. Looks like something else. She goes, oh.

A (64:24)

She looked like Janet Jackson looking like Freddie Jackson.

B (64:29)

Don't ever come back here ever, ever.

A (64:31)

Ever, ever, ever, ever, ever come out here again. All right, we gotta go, guys. Thank you to Craig and Debo for participating today. That's all we got. Try Arch public. Do it. Archpublic.com and we will obviously see you next week. Bye.

B (64:51)

Let's dope. Let's do.