← The Wolf Of All Streets
The Wolf Of All Streets
Buy Everything! Crypto Gets A Massive Boost! $9 Billion Into Coinbase?
00:57:19
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- [00:01]
Scott Melker
Arthur Hayes says that it's time to, quote, unquote, buy everything, crypto and otherwise. We're going to see if the gentleman on the panel today agree with that sentiment. And of course, Coinbase will be joining the S&P 500 next week. Some saying that could lead to 9 billion in passive flows. Absolutely huge news for our industry. It's time to get the show going. We've got Matt Hogan today alongside myself, Andrew and Tillman. Let's go.
- [00:30]
Matt Hogan
Let's do.
- [00:45]
Scott Melker
What is up, everybody? I am Scott Melker, also known as the Wolf of all streets. Before we get started, please subscribe to the channel and hit that, like, button. And good morning to Matt Tillman and Andrew. How are you gentlemen doing today?
- [00:59]
Tillman
Fantastic. Really, really good.
- [01:01]
Matt Hogan
Can't, can't beat it. Bitcoin's up. We're cruising.
- [01:05]
Scott Melker
No, bitcoin's dead. It went to 106 and it went back to like 101. It's bear market.
- [01:11]
Andrew
Hard to keep up.
- [01:14]
Scott Melker
My entire feed yesterday was, now we'll be able to buy bitcoin in the 80s again. We just got here, man. I mean, I guess anything is possible. Why not? Right? Right, but, but still, it's like the sentiment, spaz. Spasms on X are absolutely insane. You can tell how many people are not exposed to bitcoin who still kind of feel like they want to be. I mean, I think that's been the moral of the story for me. Gauging sentiment is that there's still a lot of people who thought they were going to buy in the 60s or just below 74. And now they're thinking, am I going to get a chance to buy in the 90s again?
- [01:51]
Tillman
Coinbase, everybody. Coinbase in the S P means everybody's going to be exposed to bitcoin, whether they like it or not. That, that's a big, big, big deal. And so passive investors associated with ETFs and the like, the vanguards of the world and others are going to have some small connection to bitcoin, to bitcoin, based on the fact that Coinbase is going to be in the S P 500, by the way, that wasn't telegraphed. You know, nobody was really talking about that. And then boom, it just happened. So wild. That is a, that's a really, really big deal. Really big deal.
- [02:29]
Scott Melker
Matt, is this much bigger than MicroStrategy making it into the NASDAQ 100?
- [02:32]
Andrew
Oh, it's, it's way bigger. It's not even a comparison. I mean, the NASDAQ is something that we talk about. But the S and P is what everyone benchmarks to. There's $16 trillion benchmark to the S and P. That's why you see this $9 million, even though it's only going to enter at a weight of 0.1%. But it is a big deal. It means literally every American and every American institution will have exposure to the largest crypto exchange. That's a meaningful thing. I'm at a TRADFI conference today and this, this sort of. I trialed this as a talking point. It mattered to people. It seemed to suggest to people that this industry has grown up. This is another major milestone. I actually, I do think it's a pretty big deal.
- [03:16]
Scott Melker
Yeah, I think it's an absolutely massive deal. And regardless of the passive flows, like you said, this is like a final stamp of approval because it was a big deal. Even though we had crypto companies that were listed forget even s and P500, the fact that they were even able to get on the stock market, people forget years ago was a huge deal.
- [03:36]
Andrew
That's exactly right. It's also worth noting for people who aren't familiar that the s and P 500 doesn't just own the 500 largest stocks. There are various screens. There's a committee that decides. There's a process. They want to see companies that are stable, that aren't going anywhere. So it's more meaningful than just a mechanical addition to an index.
- [03:58]
Scott Melker
Yeah, I mean, Tillman, what do you think of this? And is it fair to say that this is exposure to Bitcoin, or is it more fair to say that exposure to the industry because Coinbase actually kind of made news of late saying they had considered adding a lot more bitcoin to their balance sheet and didn't.
- [04:13]
Matt Hogan
Well, I, I think that's part of the interesting, you know, development here is Coinbase is not just a bitcoin centric entity. Right? I mean, they're launching mean coins and all sorts of stuff. So what this really is, is a final stamp of approval that crypto is here to stay and, you know, kind of let the games begin. I think that the, the, the moral of the story is, is that we won the war. The war is over. This, in my opinion, is, you know, the, the final boss, if you will, of the game. You know, getting into The S&P 500 is, you know, that's, that's, that's the end game for us now. It's about how does this game develop and what kind of, what kind of Additional products are going to be injected into the industry that allow volatility inside of bitcoin to be the secondary market, not, you know, altcoins. And so this bitcoin dominance narrative and what Bitcoin is doing right now from a, you know, corporate adoption perspective, I think that's the story of 2025. I think we're about to see something really special in terms of a squeeze that may not play out, but it's looking ever more likely by the day because these types of announcements were coming, you know, few and far between, and, and now they're just like every single day you're hearing of a new Bitcoin, you know, treasury being set up. And, you know, I think That's. There's only 21 million. There's. Nobody can turn on the faucet on the other side of it and create more supply.
- [05:50]
Scott Melker
I love Saylor. The bitcoin treasury companies are starting to worry me. Not the people who are just adding Bitcoin to the balance sheet to hedge against inflation losses, but the raising convertible debt, raising notes to buy more Bitcoin, effectively leveraging entire companies to buy Bitcoin. It's starting to worry me. How many of these do we need?
- [06:15]
Andrew
Yeah, I actually agree with that, Scott. I'll say that. I've always thought the risk. People have tried to pin risk on microstrategy. They're very sophisticated about their sort of debt to their Bitcoin holdings. The risk has always been somebody trying to outdo it to microstrategy. And I do worry that we're moving up that escalator of people who want to stick their neck out above Michael Saylor. And to do that, you have to be more aggressive. And I don't like the pattern of a million of these people with people trying to sort of stand out more than the next guy. I do think there's some risk in that.
- [06:46]
Tillman
Well, given what Kindly Stock did yesterday, it's not going to slow down for a while. No, that's the problem, given that.
- [06:54]
Scott Melker
But that's. But isn't that like Long island blockchain iced tea, you know, or like, hey, listen to everything and the.
- [07:01]
Tillman
Don't go to negative town on me, Scott. All right? Don't go to negative town on me, all right? This morning, we don't, we don't need that negativity. But in, in all honesty, you're. You're going to have a significant amount of, of this happening because of what happened yesterday. Just in the short term, you know, over the, in short term. In the world of investing, oftentimes is a quarter, maybe two. We got the bitcoin conference coming up. I'm certain that there'll be another couple of these treasury companies that get stood up and get announced at the bitcoin conference.
- [07:35]
Scott Melker
One of them is Dave. The one that was the one you're talking about is David Bailey, the CEO of Bitcoin magazine and the bitcoin.
- [07:41]
Tillman
Right. They raised money so fast that they couldn't announce it at the bitcoin conference conference to, to be fair. And so that it just, it happened very, very quickly. And that's kind of the point when you set out to raise, you know, 3 to 400 million and you raise 700 plus million and you do it faster than you think you're going to do it, that just sends a signal. I've gotten three, three emails from the company that was the, the lead kind of underwriter under what they did since then talking about all of that. I'm not the only one getting those emails. Okay. There are other folks getting those emails, being encouraged to, hey, if you want to do something like this and make this amount of capital at this amount of time and this kind of return, it seems pretty easy in the appetite for it exists. Meaning that this is going to happen again and probably several more times before it runs out of juice.
- [08:49]
Scott Melker
We're gonna do this again. Why does somebody buy like the new one or 21 instead of buying MicroStrategy? If you have four or five or six or 10 of these things, how do you even choose as an investor which one is the? I don't know.
- [09:01]
Matt Hogan
I, I think it comes down to the management. I actually like this development. Why? Because I think a lot of people are going to fail and they're going to have to cough up their stack and then that's going to be available to be purchased. And, and I, you know, I think management and structure are going to be the most important attributes to these companies being propped up. The more closely tied to Wall street you are, the less likely you are going to, going to be to fail in my opinion, because you're going to be able to pull the necessary liquidity strings when you need them to, to make the, to cover yourself to. The bigger you get, the more liability you're incurring. And so the question in my mind is like, from Matt and your perspective, Scott, what do you see as the biggest existential risk to this kind of being a mega trend? Because the way I understand it is he's borrowing against non recourse Debt, Right. Share price debt. And the worst thing that could happen is Bitcoin crash in price, which would not. None of the loan could be called right. It wouldn't create a default sit. It just would create a mass exodus of their shares and a dump on the market of MicroStrategy itself. But how does that really do anything negative to Bitcoin other than potentially free up some Bitcoin based upon them needing liquidity and having.
- [10:31]
Scott Melker
I'm at answer. The quick answer I gave is I don't know that it triggers the bear market. But if Bitcoin, which it will goes down 30, 40%, whatever, and some of these guys start to panic and do want to make people whole or want to have a company that exists, they're going to sell Bitcoin. And that's how you get the liquidation cascading. You know, sell, panic, sell panic, sell, panic, sell. So yes, if your point is that like probably whenever there's a next bare market, instead of the shallower pullbacks we've been seeing, we get the extra 20%, then yes, I agree, we get to buy Bitcoin cheaper.
- [11:03]
Andrew
Yeah, yeah, I, I think that's right. I mean it's worth noting, of course, I'm a huge fan of this. I have an ETF that only owns companies that are Bitcoin as a corporate asset. So I think this is a good deal, a good thing. I don't think MicroStrategy has this risk, but I worry about the risk that Scott raises, which is in a significant pullback. This is a form of leverage entering the system. And during periods of stress, leverage turns into cascading selling. And I do worry a little bit about the sticking your head up higher than the next guy risk as we get more and more of these. I think that that is a risk worth monitoring. It's not a risk we see in the market yet, Tillman, but it is a theoretical risk that we could see if we get an infinite number of these. But for now, it's absolutely true that companies are buying more than 100% of the supply of Bitcoin. Right. And that is a good thing for price. That's one of the reasons we're up so much. And I suspect that that's going to continue. Right. We think companies will buy 300 to 500,000 bitcoin this year. Right? 2 to 3x. So I think it's positive. But there is this potential risk you can see down the road if you, if you want to look.
- [12:11]
Matt Hogan
I see that risk. I guess to me it's like if you have the, if you have that industry growing though, that's just available market share for the firms that Do Fail and MicroStrategy and other firms that are successful, wouldn't they step in and essentially fill that void and, and, and be the winners, essentially. Because that's essentially the consolidation that happens in every developing market. Right. Is there's people that stick their neck up above to try to create the competitive advantage.
- [12:40]
Scott Melker
Yeah. But the best, and I'm not saying it's the same by any stretch, but if we have to compare it to crypto, you go back to the Block 5, Voyager, Celsius, all these guys days. It started with BlockFi at 3% yield on your Bitcoin. It ended at Celsius with 18% yield on your USDC. And every one of those to compete with the others did exactly what Matt said. Really stuck their neck up a little more. Stuck their neck up. I went through the Voyager thing. Voyager didn't end up being criminal, so to speak. Right. But what it did end up was Steve Ehrlich going to Three Arrows Capital and saying, I literally need to give my people 10% yield, take my money, do something with it unsecured. And that blew up Voyager. Right. So what stops one of these companies who has a unpopular debt raising from sweetening the terms to a point where it's extremely risky? That's, to me, is the, the risk.
- [13:35]
Andrew
Yeah, I, I think that's right. I do think there'll be more creativity in this space. I think you'll see different companies do different things. So I think this trend will continue. It's just always, maybe Scott and I are a little bit scarred from the, from the last, last bear market. It's always, you know, remembering the lessons of history so we don't repeat them. And this is something we look at closely, a bit wise. And we look at the terms of the debt, we look at will they be forced to sell and we don't see any risk right now.
- [14:02]
Scott Melker
But we do see you guys have Jeff Park. We don't.
- [14:09]
Andrew
That is true.
- [14:10]
Matt Hogan
We have to go through crypto. Twitter.
- [14:12]
Andrew
That's right.
- [14:13]
Scott Melker
That's right.
- [14:14]
Andrew
He spits out the answer.
- [14:15]
Scott Melker
Yeah, I mean, but. So that's my simple fear. To your point. I just showed that article though right now it's nothing but people buying. I just prefer the Gamestop, you know, and the Square and the Tesla. Hey, we're going to put part of our treasury into bitcoin and we're going to hold this forever to hedge against the losses of the cash that we're holding here. That to me is like such a layup that that could be so much buying from every company on the planet if that trend goes without having to turn it into some like, financially engineered investment vehicle.
- [14:45]
Andrew
Yeah, I think that's right. And I think we'll see that too, for what it's worth.
- [14:49]
Scott Melker
Yeah, I agree.
- [14:49]
Tillman
Yeah, that trend will continue as well and it will pick up speed. Maybe it was three weeks ago where it was said that, I think it was Eleanor Tourette said that, you know, like a year ago there were 35 ish companies in the S P500 that had Bitcoin on, on their balance sheet. Now it's, I think it's close to 90. So it continues to climb. And Matt was at the forefront of this, of this movement and saying that it was going to pick up speed. And so it's clearly picked up speed and will continue to again having their dominoes. Right. So Matt's point about Coinbase going to the S P500 and that resonating with Trad5 folks, that's a wave of capital associated there that really has no end. There is no end to that amount of capital finding its way into the space that we love. Right. And, and so the Coinbase thing, I think it, when we look back on it in 12 months, 18 months, two years, will be a bigger deal than, than maybe a lot of things that we've talked about in the last six months because it will have allowed both retail and institutional traditional entities to have their eyes opened. Right. Matt's standing behind these traditional guys keep, you know, pushing their eyelids open, saying, look, look, look, you can't, you can't not see it anymore. Right. It's here. And you know, the S P 500 is the Bible for Tradfi guys. I mean, period, end of story. It's what everything is benchmark on. And so having Coinbase there and it now being a part of every S P fund that exists is going to be something. And then it'll be a question of how does Coinbase perform, how does it move up the quote unquote, top 10 holdings of different types of ETF funds and all of that stuff. It's going to be, you know, it's going to be an interesting journey to watch for Coinbase and then crypto overall, you know, where are we at? Again, I go back to. And most of us on this panel are old enough to remember, right? The dot com bubble and all those companies that went from 800 a share down to 99 cents are now some of the biggest companies in the world. And so that in my mind, that's where we're headed with quote unquote, crypto and all the adjacent companies existed around it over the next three, five, seven years.
- [17:38]
Scott Melker
I would have thought, actually there was a lot of conjecture that Robinhood would be sort of the first major crypto adjacent company that would have made it into the S and P. I know that there was a lot of consideration they'd be in for inclusion. They actually have news today which is enters Canada by taking over crypto Exchange WonderFi for 179 million. Mr. Wonderful just keeps on winning. This is his thing. Wonderfi. But, but I mean, these guys, Robinhood, I think alongside Clark, Coinbase, really just driving the sort of front end of adoption here for crypto. I mean they've become as much of a crypto company as any as anyone else. Quietly, yeah.
- [18:15]
Andrew
These are going to be the two biggest financial services type firms in the world in 10 years. I think we're moving in that sort of direction. We're on the record of saying Coinbase will surpass Charles Schwab as the largest brokerage by market cap. Possibly this year. It have to 3x from here, but I don't think that's unreasonable. Every generation gets a new financial services company. Schwab was the last generation. It's time for a new one. It's going to be Coinbase and Robinhood for sure. They're both executing extraordinarily well.
- [18:45]
Scott Melker
I thought it was going to be. When Sam Bankman Fried bought Goldman Sachs.
- [18:49]
Andrew
He missed his window, Scott. He missed his window.
- [18:53]
Scott Melker
One of the, like most underreported news stories of the past few months was that Robinhood became a bank. Yeah, I mean, they're the full suite of financial services, literally everything.
- [19:03]
Andrew
Yeah, yeah.
- [19:05]
Scott Melker
They're gonna dominate, I think. And Coinbase has now applied for a bank charter is the rumor as well, correct?
- [19:11]
Andrew
Absolutely. I mean, look again, it's been a long time since we'd had innovation in the financial services space that affects most people. Right. Like, we haven't changed since the atm. It's about time. So it's good to see them moving in that direction. I, I really think they're going to shake things up significantly over the next couple years.
- [19:30]
Tillman
If I, if I'm not mistaken, Vlad is going to be at the bitcoin conference, isn't that right? Isn't he a speaker?
- [19:37]
Scott Melker
I know, I know. I know for a fact because I might have accidentally gotten you booked for Something. Matt, I'm sorry. Or, or you're welcome. But I know Robinhood actually during the bitcoin conference that Thursday has a conference in Tampa and my front friend Rob, who is now the number two guy at Robinhood because he sold trade PMR to, to Robin Hood, their custodian specifically requested your presence there to speak.
- [20:01]
Andrew
So I, yeah, I did, I did learn that yesterday.
- [20:05]
Scott Melker
You're welcome. I'm sorry. And you're welcome.
- [20:08]
Andrew
No, I'm excited to go to Tampa. That'll be great.
- [20:10]
Tillman
No, thank you.
- [20:11]
Scott Melker
Yeah, so, so, but, but yes, I think that Vlad will probably be at the bitcoin conference. They're going to be everywhere.
- [20:18]
Tillman
Which is, which is telling, right? Which is telling in and of itself. Yeah, they're, they're. I Again, to, to, to, to the point that was made here coinbase, getting in the S P500 before Robin Hood is, is a surprise. I mean that, that's, I don't know what the machinations are. You know, can you politic to get into the S P 500? I, I, I don't know politic to.
- [20:44]
Matt Hogan
Get into anything, Andrew. You know that. But I, I' the story Wall street we know is full speed ahead. I mean, the train is leaving the station and it's going as fast out of the station as it can. I think the thing that I'm really excited about and kind of blown away about is the banking side because Caitlin, we talked to her, I think last week and Caitlin Long said everyone's going to need a bank charter. Like you wait until you see the rush of companies go and try to become a bank because of what Matt just said. I mean the, the innovation that has been suppressed for the last 20 years is about to explode. And you know, Caitlin was talking about what they were able to accomplish through regulated channels, FDIC insured channels. They were able to do create a deposit token based upon deposits they held with a company and send a cross border payment instantly pay the employees on payroll. Right at that moment it was truck drivers delivering goods. So they got paid right when they made the delivery. And they did that all with regulatory oversight and approval. That is, that's never been done before. That's literally the first of, of its kind. And the fact that it's happened now means the cat's kind of out of the bag. And I think there's going to be a race to integrate crypto into, you know, banking systems everywhere in the United States. And I think between Wall Street's adoption and our banking industry's adoption, we really, we have a head start if we go fast and furious on both those fronts against every economy on the face of the earth. I think we, we do a great deal to support the US Dollar's dominance and, and keep it in kind of the center. Center's spotlight as the world reserve currency. If our banking system is the only banking system that's able to do this and pushing the boundaries, which I know Caitlin said that she's patented the process. The question then becomes, you know, how quickly can they get this integrated and really replace the Swift network with this new digital, you know, settlement layer? It's to me that, that I'm watching that like a hawk because I think that's going to be where again, millions and millions of people see the benefit of crypto and get that exposure for adoption.
- [23:13]
Andrew
Yeah. I would just add, I think it's happening at a much greater degree than people are feeling. There's almost a boil the frog element. We just skipped over a news story that said Robinhood chose to enter a new country by buying a crypto exchange. Right. A week ago, Robinhood said it was building a brokerage to trade U.S. stocks for European investors on Arbitrum or Solana. And no one even tweeted about it. Right. Like, these changes are happening so fast and so frequent that we sort of like shrug, like, oh, yeah, great. Of course, of course they would enter a new country. Crypto first. Right. That is incredible. Think about that headline. Two years ago we would have been talking about it for months. And so I do think this is going to happen a lot faster than people think. I don't think it's priced into the assets. I think it's a bigger deal than people, people recognize right now.
- [24:10]
Scott Melker
So outside of these news stories, let's talk about the market itself and what's happening. Obviously, the China US Trade deal, potentially a big deal. I guess we'll see in 90 days as that develops. But Matt, you obviously dropped one of the greatest quotes in the history of this show, which was effectively that governments have made recessions illegal. And well, even JP Morgan now drops US Recession call after U. S. China trade truce. And then of course, we have our title here. Arthur Hayes declares buy everything. He actually said that in a fireside chat that had no fire, coincidentally, if you guys have ever been to a fireside chat, I've never seen one by a fire, but in Dubai with, with me. And here he is. Buy everything. Chimerica lives USA and China agreed a major reduction to tariffs for 90 days. Like, it almost concerns me that People are so bullish now on this news because it was supposedly so bearish before, but it seems like markets are on all systems go right now. And that's going to include crypto. And I would say maybe even the best gauge of that is that all coins actually went up.
- [25:09]
Andrew
Yeah, I think that's right. All coins went up. I also think it's the case, Scott, that we suppressed and looked past a huge amount of good news over the last couple of months because we were distracted by this negative event on the tariff side. And so I think there's, there's a coiled spring element that you saw in eth's rally. Like ETH had a lot of actual good news that a reorientation of the foundation. It had some positive talk about its development roadmap. It had the PETRA upgrade and it did nothing. And then it was released and you know, it's up 40. And I think that's true even of bitcoin. I think there's a lot of positive news in the bitcoin market that just got lost amidst the distraction of the tariff. So I don't know where we go in the next, like, couple days, but I'm pretty optimistic about where we go if this is the new normal. If we have banned recessions and, and we're back to, you know, risk on in the market.
- [26:05]
Tillman
Yeah, there's, there, there's going to be a. And again, I often default to BlackRock's thoughts. Right. And their Biddle portfolio is now nearing $3 billion when 90 days ago it was $500 million. Right. And that's not because the assets inside that portfolio have gone up by fourfold. It's because people keep shoveling money into it. So it's not always going to be just a bitcoin story, right, that there are other assets that are going to live and breathe and grow and become part of the larger story associated with, with the industry. To me, it's fascinating to see where we'll be in two years. I think there's going to be a huge, huge bitcoin ecosystem that will be, you know, a totally different conversation than just, you know, where is the price today? But at the same time, I think there's going to be things that are built and things that are going to be used on other chains that people haven't considered in a significant way just yet. And as always, smart minds and quote unquote, smart money are ahead of the curve. The bitwises of the world and the blackrocks of the world that, that are, you know, putting portfolios together based on that premise. And yeah, I, I think, I think we're going to be surprised in many ways what, you know, jumps to the forefront in the next couple of years and, and there's a lot of people making bets on, on that reality. Again, when you see money and assets flow in a certain direction. You know, Larry Fink doesn't say bitcoin's going to five to $700,000 just because he's bored and he wants a headline, not how that guy works. So for that to happen, you would think that other assets are a part of that story. And that growth story is not just a bitcoin dominance to 95%. That's not where we're headed. Bitcoin dominance may still be a real thing, but there are going to be other chains and other assets that become a part of the story, and it's going to be fascinating to watch.
- [28:25]
Matt Hogan
Well, I think what Matt said about skipping over the headlines of them entering the a new country on the back of buying a crypto exchange. You know, if you look at any industry, one of the precursors to mass adoption is, is that big companies start spending big money on infrastructure and connectivity. And if you look at the acquisitions that have made the headlines over the last few weeks, they're big dollars and they're all about infrastructure, they're all about buying exchanges, they're all about connecting markets so that capital can flow freely between traditional markets and now these new crypto markets. That's what Ripple's trying to do. That's what everybody's trying to do. That kind of understands this, this trend. And then when you inject the bank's adoption on top of that, you've got full circle effect. I mean, it's where money can go anywhere, anytime. Both tradfi and crypto. I mean, coin. I remember TradeStation used to have functionality three, three, four years ago where you could deposit funds, you could trade Trad 5 securities, but they had a sister brokerage that was connected where you could transfer money and trade crypto and you could move money back and forth and you could also then take the crypto off in cold storage. It was a very unique loop that they possessed. And they, they shut it down. They couldn't keep it up because of regulatory, you know, scrutiny. I guess that's speculation. I don't know that for a fact, but I would assume so. But now you're going. That come back and in spades. And so what does that mean? It just makes it a lot easier for dollars to flow into this market at every level. Both now in Wall street form, where you're buying ETFs and, and, you know, products, but also in the crypto form on chain. You know, when that, you have that, when that connectivity happens, there's going to be a lot more money that can flow on chain that could never get there. And Coinbase is being adopted or put into the S P is, is, is like proving that in spades. If, if they're not going to be able to do it, who will?
- [30:34]
Scott Melker
Yeah, my next question was going to be how much does this matter for base? I mean, they literally have their own blockchain and they're now in the S P500.
- [30:43]
Tillman
I think that the other trend that, that we may see is a, an enormous amount of merger and acquisition activity in, in the crypto space because there's going to be a bunch of folks that go public and when you go public, you got, you got pockets full of money. Right. So you have the opportunity to do that. I'd love to get Matt's thought on that because that has happened a bit, a little bit in other cycles, but in ways that, you know, probably, maybe if we go back and look, or slightly uncomfortable, but now there's going to be a legitimate legitimacy to it. So I think that particular area of the space may explode a bit. Matt, what do you think?
- [31:24]
Andrew
It's already exploding behind the scenes. The number of M and A conversations, the number of pitches that come into my inbox. This is already happening at the crypto to crypto level. And then I think there are two other unlocks that you spoke of. One is crypto companies going public and then having a lot of cash. We're going to see a dozen crypto companies go public in the next year.
- [31:46]
Scott Melker
Zincalcy going public next week, basically today.
- [31:49]
Andrew
Yeah, one of these days. And they're just the tip of the iceberg. I really think you'll see more than more than 12 go public in the relative near term. And then it's traditional companies buying their way into crypto because they have to. So you're going to see a massive wave of M and A and that will cycle back into new VC funding. I think it's a really big deal. I mean, it is shocking to me. If I measure the number of investment bank pitches coming into my inbox, it's up not 2x, it's up 15x year over year. It's absolutely massive. Lots of companies for sale and a desire to grow. So I think it's a really Big theme.
- [32:29]
Scott Melker
Yeah, it's funny, I'm looking at, I was just looking at that tether headline we brought up before. There's more tether in circulation than ever. But then I just started seeing latest crypto news and when you just look at all that's happened in a day or two to the point about how fast things are happening. I mean, the Robinhood news we discussed Galaxy going public. Dubai's Finance Department signs MoU with crypto.com to enable crypto payments for government services. Coinbase being listed, right? I mean if you click in, you have like Eric Adams saying that they want New York City, New York to be the crypto capital of the world. Nasdaq listed GD Culture Group to sell up to 3,300 million in shares to acquire Bitcoin and Trump meme Coin. I mean, you can't even keep up anymore.
- [33:11]
Andrew
It's wild. It is wild. It's completely wild. It's also true that crypto spent like two years building incredible infrastructure but not having market penetration because we were shut down by regulators. So there is this reason we can grow faster and reason more things can happen. We couldn't have had this activity a few years ago where, you know, you'd have the ETH transaction fee spike to 30. But we're not in that world anymore. We've built the infrastructure to scale. It's an amazing market.
- [33:41]
Tillman
Well, even at a company to company level because of that, you know, more than two year period, all of these companies are very lean, right? They're extremely lean. They can move very, very, very fast. They're not bloated with personnel or with other restrictions associated with growth that's, you know, unfettered and money blowing into the sky. So the ability again over the next two years, I think we're going to see a different landscape. And again, it's very, very exciting space to be in. To your point, Scott, just showing off the headlines in, you know, a half of a day. Now, two years ago was four months of headlines that we were all excited about and would, you know, materially move the, the price of bitcoin and other assets. Now it's every single day stuff is happening and it's not going to slow down. It's going to pick up again, to Matt's point, you know, 12 plus or more, maybe closer to 20 over the next 12 months because there's going to be some that go public that probably shouldn't, but it's going to turn into a bit of a frenzy. And so you just do because you that the money's available to you, that's going to create another just wave of activity again, that it's going to be fairly legitimate. It's very, very different than the FTXs and Binance of the world throwing money at people and hoping for the best. This is now, you know, public markets.
- [35:11]
Matt Hogan
So I think it's the ICO days, but legitimate, right? It's, it. This is going to be just like the ICOs where you just, you started a coin and it just starts going crazy up because there's so much liquidity that wants to, to make those speculative bets on kind of first market. And you always see that with markets that are suppressed, right? When, when, when markets are artificially suppressed, when the demand continues to boil under that surface, there has to be a boiling over point. And I think we're, we're about to see that boiling over point. And what's going to be really fun is to see to your point earlier, like whose head gets highest. And that's going to have natural consequences. People are going to fail. But chasing the monthly transactional users is going to be what everyone is trying to do. Why? Well, because coinbase has what, 300 million users. That creates a whole lot of incentive to go carve out some market share. And how are you going to do that? By differentiating yourself just like the ICOs did, as it relates to like their use case and their potential market fit. But instead of it being on the back of speculative market fit and speculative utility, I think this cycle is going to be about actual utility. It's going to be like we acquired this exchange. Why? Because it comes with this many monthly transactional users and it connects this market to this market, which unlocks this much more capital than we had before and that leveraged into a share price that is going crazy. You've got growth potential out the wazoo. I mean, this is, it's going to be a wild, wild ride. And I think that if we think the ICO days were crazy, the depth of liquidity that pumped the ICOS is, is so shallow compared to the liquidity pools that we're playing in now. I mean, it is incred. It's, it's incredible. It'll be, it'll be fascinating to watch over the next few years.
- [37:14]
Scott Melker
Yeah. Matt, anything before I let you go, anything specific that you're excited about from bitwise, anything you guys are building, what do you think will be sort of the next big play?
- [37:25]
Andrew
Yeah, well, I'll just give you one anecdote from being on the road and then I'll talk about Bitwise for a minute. This is the, the, the third. I'm at a major financial services conference from a, a mid market brokerage dealer with you know, north of half a trillion in assets and it's the third type of that conference I've been at in the last month. I've gone to them every year. This year I'm the closing keynote at all of them. And last year I was a sideline and then two years ago I was a pre conference event. So as a Matt Hogan indicator of you know, our progression into the mainstream, you know it's, it's moving in the right direction. At Bitwise we just, we continue to innovate with new products and ATPs. You know we're pushing to get our index fund uplisted and we continue to do more on chain to knit some of this conversation together. You know Bitwise is now doing, we now have a multi billion dollar staking business. We're now looking at other on chain solutions as well. So I do think this tradfi and crypto native are coming together. I see that at Bitwise and I see that in the industry broadly.
- [38:33]
Scott Melker
Yeah, I love it. You guys never stop. You never. I don't know how you can always be at all these conferences. Lots of chicken, dairy, understanding family.
- [38:44]
Andrew
That is right. My wife's a saint. Yeah, 100.
- [38:48]
Scott Melker
They all are if they deal with us. I have to say guys, you give, you can give Matt a follow obviously on X tagged right down below. Matt, we always, always appreciate you showing up especially at 6 o' clock in the morning. Hey, happen to be in the world.
- [39:02]
Andrew
Always for you guys. Thanks. Great to see you all.
- [39:04]
Tillman
Thanks Matt.
- [39:07]
Scott Melker
All right guys, let's. Oh, your faces are huge. I'm gonna leave. Okay. I'm gonna make our faces smaller. Not because of you guys, because of my face. I hate. Do you remember MySpace that my face would have been good if they had mixed Facebook and MySpace.
- [39:24]
Tillman
Yeah, there you go.
- [39:27]
Scott Melker
The mind of an 80 ADHD.
- [39:29]
Tillman
Opportunity missed. Yeah, opportunity missed there Scott. You could have been on something. My face.
- [39:35]
Scott Melker
Absolutely. So now let's talk about Arch Public. Let's do it. We got the scrolly thing, we got the logo thing, we've got Vegas coming up in two weeks. What's going on there?
- [39:46]
Tillman
One thing to note for us, the RL goes again. Being user driven, you have the opportunity to dial in everything that you want to dial in there. I take a look at the price action over the last 30 to 40 days in crypto which has, you know, bottomed to some extent and then, then rocketed higher very, very quickly. A V shaped, a real V shaped type of stuff. And so one of the value of algorithms and executions that are completely disassociated with emotion, fear or greed doing the work on your behalf. Well, to give you an example, our Solana Arbitrage algorithm bought at 104 and 113. And where do we sit today? Scott? 175. Right. I'm not a, a math whiz, but that's better than 50%. Therein lies the value associated with unemotional rules based executions that are happening not only in the midst of movements lower or higher, but when you're completely unavailable to make those decisions on your own, when you're sleeping or when you're indisposed in some other way. Our customers continue to come to us and tell us this is extraordinary stuff. I'm not only using the setups that I started with, but I'm now using these setups because I've gotten comfortable and I dial this in and I dial that in. And so, you know, over the weekend I had 10 executions that happened based on the setups that I've come up with and the setups that you guys have put together in case studies. So it is fascinating to watch the community grow, to watch the community become very, very aware of the technology that they have in their hands and that they have the capability to use associated with volatility and the opportunity that exists there to have tools. You know, it's like going to mine gold in a mine but you only got your fingers and your, your fingernails to scratch versus, you know, the latest and greatest tool to just start hammering away at walls and all you're doing is pushing buttons so it hammers either faster or slower. Big, big, big difference.
- [42:08]
Matt Hogan
Yeah. And honestly that's why we've, we think thing is believing, that's why we've made the product free to use. If you want to download it, you go to our website, click try the Bitcoin algo or the XRP algo or the ETH Algo and you can, you can download that algorithm for absolutely nothing. You can use it up to $10,000 of purchasing power every single year at no cost. And so once you see behind that, we will spend as much time as needed to help you get up and running. So that's something that we really firmly believe in. We've been in the crypto space for a very long time and the customer service has been horrible. Every company involved and so you know, I think a new dawn is, is, is breaking and I think we are going to be setting a standard as it pertains to helping people. So if you've never used automation before, if you don't know how to use it, that's what we're here to do. We can literally run you through every single feature set and get you set up. And then once you get going, like Andrew said, you know, you're going to have an eye opening experience. You're going to be exceptionally excited about the tools that you now possess and we'll spend more time with you talking about how you can set it up to, you know, the nth degree. So this can fit anyone's, you know, bill as it pertains to what you're trying to accomplish, whether you're trying to accumulate, whether you're trying to trade, whether you're trying to unaccumulate or sell, it can do all of those things very, very effectively. And we can show you how to dial it into your specific user parameters. But once you see the software, once you really get to play with it, I think it's going to be a very eye opening experience for you. It was for, for us, when you get your hands on the first tool, piece of automation, it's, it's something where you go, man, this has endless potential to provide material value. And so that's what we've dedicated the last five years of the firm to, is building that value and trying to fit institutional tools inside of a package that allows retail consumers to manage them and to deploy them very, very easily. So we're trying to make this as easy as possible. I think we've come such a long way that that's the response that we're seeing in the customer growth. You've had thousands of customers download the software and we get positive feedback from, we don't get any negative feedback because if you don't want to use it, don't use it, but it is going to be available more than you are. So when the market presents those opportunities to either buy and, or to sell a little bit, if you're not sitting in front of the computer or if you're like John Deaton said in his tweet this week in court and or picking up your daughter from school, the algorithm is, is not, you know, it doesn't have any other priorities. It sits there and monitors the market. So really excited to see the customer growth. We want to continue to improve. So if you have any suggestions for the software, please reach out to Us, but schedule a time for a demonstration, schedule a time to get on with one of our staff members and help you get it set up. Because I think you're going to be very pleased when you do.
- [45:16]
Scott Melker
What I think is amazing is that we started this how it's got to be almost a year. A year.
- [45:19]
Tillman
A year, yeah, yeah.
- [45:20]
Matt Hogan
More than a year doing this.
- [45:22]
Tillman
A year.
- [45:22]
Scott Melker
We're so old and we were. You were not doing anything with bitcoin at all. It was, we were on trade station, obviously trading with the algorithms that have done incredibly well. And then you could dollar cost average basically into Bitcoin at the end of the day by taking the profits from your trades on, you know, S and P and such. But I looked because we used to do the daily update, you know, the weekly update, $10,000 portfolio and then we moved on to the bitcoin algorithm. It made over 42% in a year and 7% this week. Yeah, the original products are still just crushing it over on the other side, trading stonks.
- [46:01]
Matt Hogan
Yeah, well, the futures market. Yeah, there's automation. We have automation for the futures market as well, like Scott saying. And that is in my opinion a little bit more sophisticated because you're trying to only trade for cash in the futures market. What's great about crypto is if you want to accumulate crypto, think about it like this. If you make a trade and the trade goes against you and you do appropriate job of really scheduling out how much dollars you place in each trade and you keep a lot of powder dry, then as the price goes against you, you're able to dollar cost average into a position as the price goes for you, you're able to cash out of some of those positions if that's something that you want. And so you keep your losers and you keep them over a long period of time and you, and you cash out of your winners. And so there's, there's two outcomes that you get. You either get a lot of accumulated crypto like of your preference. If you want to accumulate Bitcoin and you start implementing a strategy like this, you will accumulate a lot of Bitcoin if the price continues to go up and it shakes the tree in a lot of volatility. You also will, based upon your parameters, be able to sell that and make some cash yield on top of holding that, that, that core position. And so this allows you flexibility to, to take advantage of volatility is, is the bottom line. Because volatility, when you're just holding it's hard, you know, it makes you, you don't like it because you're holding a bag and it's going down against you. But if you're able to take some of those holdings and take advantage of the volatility and play those swings, it, it allows you an opportunity that you would not otherwise get if you didn't deploy automation. So it's, it's something, again, that will add versatility and flexibility to, to your strategy, your Bitcoin accumulation strategy, or your Solana accumulate, whatever. You know, the crypto. Right now we've got four available through Gemini. We will be expanding very shortly to Kraken and to Coinbase. We're excited about that expansion because there's some coins like Sui that we want to add, and they. Gemini doesn't currently serve that. And we also have some markets like Canada, where we have a lot of customers in Canada that have said we really want to use this software, but unfortunately we can't right now. So this will help grow our customer base, get the tool in more people's hands. And just like what we've talked about earlier with Matt, the next iteration of this cycle is going to be built on utility, and it's going to be built on what utility you provide the market. And this is, like I said, try it and tell us that it provides, tell us whether you think it provides utility, because we've gotten a ton of customers that have said that they believe it does. So we're excited about that.
- [48:50]
Tillman
A reminder, too, is that 80% of all TradFi market trades that happen in traditional markets are algorithmically done. That is a reality. That's the reason why there's nobody on the NYSE floor anymore yelling and screaming at each other. In other words, at some point that same percentage of algorithmic trades will find its way into crypto. Okay, so you use these tools, we've made them free. You're ahead of the curve now. Now you're ahead of the curve. At some point, you just got to be on the curve. So that type of functionality, that type of maturation of markets, that type of squeezing of margins associated with what happens in the crypto space, we're at the beginning of things starting to move and change and shift so that, you know, liquidity acquiesces around certain assets, certain exchanges, the whole idea of merger and acquisition. So instead of there being 9,000 exchanges, there's going to be about six, six that matter in two years. And then five years from now, there's going to be three that are still crypto kind, you know, Only that matter. So, you know, now's the opportunity to stay ahead of the curve, use tools again that are free to stay ahead of the curve and, and benefit in a very, very unique way. We're going to be at the Bitcoin conference in a huge way. We've, you know, sponsored the complete whale Experience. Scott's going to be there with us for a day or so, and I.
- [50:30]
Scott Melker
Am not the whale experience.
- [50:31]
Tillman
Yeah, he's a different experience.
- [50:34]
Scott Melker
Whale experience is just me in a room now, the middle experience.
- [50:40]
Tillman
So, you know, we're gonna have a separate space, a, A suite that's a little bit off the wheel experience for people to come and spend time with us. Scott's going to be doing some really interesting interviews and so just, you know, get connected with us. Stay around Arch Public, stay around Scott. We're gonna, we're gonna be doing some really cool things there in Vegas and looking forward to meeting all of you, everybody.
- [51:04]
Matt Hogan
And if you're a big XRP or bitcoin believer, we've kind of got a new live case study that's posting all of his trades, which is Mr. John Deaton. So if he's amazing, if you wanna, if you want to kind of see blow by blow on somebody that's using the software very aggressive, aggressively for their own purposes, you can follow along on him on, on AX and follow those.
- [51:25]
Scott Melker
Trades like the most respected guy in the entire industry.
- [51:29]
Matt Hogan
Yeah, he's awesome. Listen, he's got a heart for the people. That's what attracts us to, you know, he, he really is just transparent, which is awesome.
- [51:36]
Scott Melker
And this thing, I mean, there's every trade that the algorithm.
- [51:41]
Tillman
Yeah, he just flat out sharing his trades.
- [51:43]
Scott Melker
I mean, he was so annoyed, probably because he was just saying annoyed that immediately people are like, have you been hacked, dude?
- [51:51]
Matt Hogan
Listen, we've had. Joel Katz can pop up and show concern like, hey, Deaton, are you. Have you been hacked, buddy?
- [51:57]
Scott Melker
Let's, let's hold off if it's actually.
- [52:03]
Tillman
Yeah, I mean, he takes screenshots of his, of his trades and a bunch of them happen over the weekend with all the, the upside stuff. And, and you know, there it is. This is as transparent a guy as you're going to find in the space. And you know, talk about no bs. The guy's a lawyer. I mean, you know, you can't, there's no fake it till you make it stuff here.
- [52:24]
Matt Hogan
It's.
- [52:25]
Tillman
This is what Dialgo does. These are the results. Here's my account. Take it for what it's worth. Good Bad or indifferent. And, you know, we're going to spend some time with him at the conference. Got a VIP dinner that he's going to be at. You're gonna interview him? Yeah, we're gonna spend some real good time with it.
- [52:45]
Matt Hogan
Well, I think that's the most exciting part.
- [52:48]
Scott Melker
I was gonna say, apparently the Whale Experience is me in a room watching Brendan Flasier flicks. I don't know why that's funny to me. I don't know if it's like Encino man or if we're watching School Ties, but for some reason, that just really made me.
- [52:59]
Tillman
What an arc that guy has followed, you know? What an arc that guy has followed.
- [53:03]
Scott Melker
You know, roller coaster.
- [53:06]
Matt Hogan
I was just going to say, I think one of the neatest things that John's made himself available to do is take a Q A session in our room at the conference. So one of the things that I think is going to be different about this conference is just the level of talent, if you will, that's available to. To talk. So pretty exciting stuff. I mean, just like we've talked. Spent this whole show talking about, like, the companies that are adding it to their balance sheet. I mean, think about it. There's going to be a lot of publicly traded company C suites at this conference. There's going to be a lot of government officials in official capacity at this conference, including the Vice President of the United States. So, you know, last year, as cool as it was that Trump came and spoke at the conference, he wasn't in office when he did. This year we've got a bunch of people in office that are coming to the conference. That's pretty unbelievable.
- [53:58]
Scott Melker
I literally think, like, I look at the lineup of this conference and the people, like, a lot of them are just like. Like Brian Johnson, he's got to live forever. I'm like, I don't know what that has to do with bitcoin, but apparently, like, Biggie and Tupac are playing in the Whale Room with Brendan Fraser and they've got everybody coming to this thing. I don't even know. Crazy. Crazy as we got to go. It's 9:57. And. And we have lives, you know, guys, try archpublic.com discover bitcoin. Yield. It's scrolling down at the bottom. Like, I see the criticisms, the code, like, they're not holding your. Like, people are so dumb. And it's not. Excuse me, you're not dumb. You're just making assumptions. Yeah, they're not holding. There's this. We don't hold any access to your money.
- [54:39]
Matt Hogan
No access.
- [54:40]
Scott Melker
And if you don't like the trades, you hit stop.
- [54:43]
Tillman
Yeah, yeah.
- [54:44]
Matt Hogan
Well it's important to note so it in, in old times there's a lot of scams around software where they say let us hold your money and we'll provide some yield on it. That's not how this works. We give you access to a suite of software that then you implement inside of your brokerage account. We don't have access to your brokerage account. Your funds are yours. So it's completely different. That's why we're offering it for free. Try it and see what you think.
- [55:10]
Scott Melker
And if you have a bunch of money and first of all if you're the type to trade, this will help you trade better even if it's your own strategy. Okay. And B, like if you want to buy more bitcoin, there's going to allow you to buy more bitcoin at better prices. It's not like there's nothing weird here. Yeah, yeah, I listen the funny thing is though I'm going to be to be fair to like the, the reply guys and stuff I used to on algorithms all the time because every single one that I tried it was like it was some like garbage or it froze or it didn't execute and stuff but that was like on a dex somewhere or like you know, it was like some third party API that was allowing me to like access finance from the U.S. yeah some weird. You know this is guys like you don't get. Well this is CEO of, of these companies. This is not, it's not that you don't have to use.
- [56:02]
Matt Hogan
Well here's the great part. You get to download the software and you get to look at the results through TradingView. You don't even have to trust us for the results. Results. You can do your own back testing on the largest third party integrated platform on the face of the earth. Trading View. So again seeing is believing. We'd love to help you. We'll spend time helping you absolutely at no cost. So reach out to us.
- [56:24]
Scott Melker
All right, gotta go guys. That was awesome. Thank you so much. Always amazing having Matt like is there any better spokesperson for the industry?
- [56:30]
Matt Hogan
That whole company is intimidating. They have a bunch of big brains over there. It's crazy.
- [56:36]
Scott Melker
They're killing it. Absolutely killing it. Love to see it. See you guys next Tuesday and all the times in between. But see you guys next Tuesday. By the way, the next one after that we're gonna be. Not here.
- [56:48]
Tillman
No at the conference.
- [56:49]
Scott Melker
Maybe we'll you know, we'll live stream at 6am we could do it. We could wake up.
- [56:52]
Tillman
We can. We can.
- [56:53]
Scott Melker
We can do it live. Oh, yeah. Okay, Before I cat, my mouth writes any checks my ass can't cash. Let's Joe. See you guys later. Bye.
- [57:03]
Matt Hogan
That's dope.