← The Wolf Of All Streets
The Wolf Of All Streets
Can Bitcoin SAVE GameStop?! Huge Crypto Regulatory Changes Are Happening NOW!
00:29:59
Loading summary
Transcript42 lines
- [00:02]
Scott Melker
Can bitcoin save gamestop? Who's going full micro strategy, raising convertible debt to buy more bitcoin. That's just one of the many stories that we have here today on the Friday 5 with NLW. Let's go, let's go. What is up everybody? I'm Scott Melker, also known as the Wolf of all streets. Before we get started, please subscribe to the channel and hit that like button. I'm here broadcasting live from Bill Barheit's living room. He's the guy who has always had the piano behind him. I'm gonna go ahead and bring on nlw. Also broadcasting live from Bill Barheist living room. It's weird. We should just have been on one camera, you know?
- [00:56]
NLW
Yeah, it's. The setup is actually complicated when you try to get two people in the same room. So I'm glad we figured it out.
- [01:02]
Scott Melker
It is. I hope you're not getting echo through your mic from you screaming three feet away, but here we are, not for a piano concert, but to talk about the Friday 5. All the things that have happened in crypto this week. I mean we just sort of have to always Honorable mention price action, which continues to be about as pleasant as a long trip to the dentist. Stories are hilarious. You got spotty TF's report, 10th straight day of net inflows. Yeah, it's great news. And then the next article is we have auctions expiring Bitcoin above 90k and then crypto slumps 4% on Trump tariff moves. But US GDP data helps markets recover. I mean, I've come to the grand conclusion that nobody knows what the hell is going on or where bitcoin price is going or why it is the price that it is at any given time.
- [01:48]
NLW
Well, yeah. And then like five minutes ago, didn't we get a hotter than expected CPI print too? So what's going on with that? I mean, that's going to be coming in.
- [01:56]
Scott Melker
I don't even know if that's good or bad.
- [01:57]
NLW
Yeah, exactly.
- [01:58]
Scott Melker
One thing's good news. It's good news for the economy, it's bad news for market. If it's bad news for the economy, we might raise rates and that's therefore good news for risk assets. So here we are just in the doldrums of sideways miserable chop.
- [02:11]
NLW
Yeah, man, it's. We, it is always, we are always reminded that people in crypto hate nothing more than sideways. Like we would. We are gluttons for punishment or excitement. But one way or another, we would rather be either cratering or soaring. And nothing in between.
- [02:30]
Scott Melker
Well, this nothing in between is a purgatory that many cannot tolerate, as you can see by people losing their minds, obviously on Twitter. But let's talk about the first official story of the day, and that is, of course, assuming I can get it up here, GameStop sink some plan to borrow 1.3 billion to buy Bitcoin. You've got this tweet here. There's what the chart looks like after they issue, decided to issue debt and made that announcement down 25 at one point. This is a pretty, pretty funny little meme we got going on here. But what's interesting here is that I was kind of traveling yesterday. So the day before I saw that GameStop was up like 14 pre market because they announced the strategy to buy bitcoin. But then when they said they were going full micro strategy. You've seen the movie Tropical Thunder, right? Never go full. I don't think we're allowed to quote that here, but even in 2025, but never go full anything. But they went full microstrategy, raising convertible note and down goes the ship.
- [03:29]
NLW
Yeah, it's so, it's very weird. I mean, you know, you're correct in the analysis. They announced that they were going to do this and they were sitting on this big old cash pile from, from cashing out at one of the, one of the, you know, recent pumps about a year ago or, or, you know, it's a little less than a year ago. And I think that the market liked the idea of them spending some of that cash on bitcoin. Right. And so, you know, stock rallied. You know, it was up, it was up double digits. But then they decided to issue convertible debt to do it. And everyone is sort of, you know, left with the, the, the confused monkey meme of, of why do that rather than just spend the cash on hand. But look, you know, ultimately I think that GameStop is not a company that does things sort of halfway. They, they lean into their own memes and it's, you know, it seems like that's what they're, they're thinking about doing here. I, I think that this is just the, you know, the, the, the, the poetry of this, this is the prophecy being foretold. I mean, this was, you know, we, we had that quote from Elon forever ago that, you know, in retrospect it was inevitable. This feels like that, you know, times 50. So I don't know. I, I think it's a, it's, it's, it's A match made wherever matches are made these days. But you know, I, I, I again, I think that markets are a little confused around the specifics of, of, you know, it was, they thought it was one thing and they liked it, and then when it was a different thing, they didn't like it.
- [05:01]
Scott Melker
There was a lot of conjecture about this, obviously, because of the photo of the CEO of GameStop with Michael Saylor a few weeks ago. And so, as you said, the prophecy did come true. I guess it begs the question whether GameStop is a serious enough company for us to each, for us to actually even count this as meaningful, or do we need a company that actually does something that's not a meme to adopt Bitcoin for us to start really talking about it as a serious treasury asset? I mean, I think in the eyes of Wall street, even strategy at this point is a bit of a meme. Right. It's obviously not the business software company that's successful in just adding Bitcoin to its balance sheet. This is their entire strategy. If GameStop follows the same, do you want to really be the second doing it?
- [05:45]
NLW
Yeah, I mean, look, I think GameStop has a, a bigger business than MicroStrategy did when it got this thing started. Right. You know, still 5 billion doll whatever in revenue. And, and they, that part. The other thing to note is they also did report like 4, 4x what Wall street expected in terms of, of, of revenue or profit rather. Uh, so, you know, there were other reasons besides just the Bitcoin announcement that their stock might have been, uh, might have been going up. But I, I think that you're, I think that it's pretty clear that this is still in the realm of the, the meme side of the treasury strategy. There was an interesting recent argument recently. I can't remember if it was Matt Hogan or if I'm just attributing all interesting analysis to him right now, but someone was arguing that the actual, the main impact of the BSR was less likely to be other governments immediately kind of, you know, get getting in the game and the game theory happening that way and instead it being a, removing another kind of lingering impediment when it came to the treasury strategy. Right? Like legitimating Bitcoin as a Treasury asset that was likely to be taken up by, by, you know, public companies faster than it was by government. So, you know, look, I, I think that we're likely to see more of this. I don't think that MicroStrategy is, I think that they've Made it so that you can't really completely copy their, their approach. Right. That's sort of, you know, they've on the one hand evangelized, but on the other hand blocked off barriers because there's just not that much room for, for multiple of these, of these types of companies. So, you know, it' to see. I think GameStop is a little archipelago ecosystem unto itself and ultimately what it's going to care about is what, you know, makes sense to it and what makes sense to its legion of, of still kind of committed shareholders. The GameStop folks might not be as loud as they used to be, but they have not gone away. They, they are.
- [07:42]
Scott Melker
Oh, we saw that when Roaring Kitty came back.
- [07:45]
NLW
Absolutely. It is it, it of all stocks has the most crypto like following. Like, you know, there is a floor put by, you know, the people who just like the stock and, and I don't think they're going anywhere.
- [07:58]
Scott Melker
There are people in the comments who don't like us being in the same room. So I'm going to go ahead and move myself to the doge with glasses.
- [08:05]
NLW
Okay.
- [08:06]
Scott Melker
From chat GPT just for the moment and we're going to move on to the next story, which is a lot more serious actually, than my background would indicate. Although I think this is one of the best headlines I've seen in a long time. Crypto's favorite money laundry shakes. The yoke of sanctions. This, of course, is about tornado cash being removed from the OFAC sanctions list. Absolutely huge news. You can see that it's been delisted. This was something that was very important to the crypto industry and is actually happening. It turns out that code might be free speech here or that you might not be a criminal for simply protecting your privacy. So what's going on here? And are these guys still sitting in jail even though the OFAC has removed this from the sanctions list?
- [08:47]
NLW
Yeah, so it's, it's great news, but not as sort of unreservedly great news as perhaps it might seem at first. So the great news is exactly what it said, that all of these addresses that had been previously listed on the sanctions list are now off and that treasury is acknowledging this challenge of sort of, you know, how do we deal with the fact that we don't want North Korea, you know, using these assets, while at the same time we don't want to penalize, you know, and kind of, you know, abnegate our own principles in order to get there? What makes it a little bit less, you know, fully, fully robust in terms of, of the counter shift is the treasury is not saying that, that in print. They're not arguing or, or guaranteeing that they're never going to put anything with tornado cash or a mixer back on the sanctions list. Right. This is a very specific change that's happened in the context of these particular addresses that had been listed. It's not totally clear how far Treasury's conviction around this goes. It feels very much like they're in a uncomfortable kind of in between place. They are dealing with a court order. Right. So there's some amount of this that was compelled and they're just trying to get ahead of it rather than fully having to, to, to be compelled. We have other parts of the government, you know, the SDNY that are still purs pursuing criminal charges around this. So it is still an uncomfortable area. I mean it, it basically, it does appear that you're less likely now to, to, to, you know, be, be jailed as an American for just using these types of tools. But it is, it is. We're not out of the woods when it comes to real clear legal precedent for, for, for mixers and for this type of technology. So absolutely, undeniably progress, undeniably a good thing. But unfortunately, even more than some of the other, you know, kind of good news that we've had recently still has a lot of caveats and asterisks around where, where it all ends up. Ultimately.
- [10:58]
Scott Melker
I think we'll take it as a victory. Did you. Yeah, I don't know if I got muted there for a moment, but having some technical difficulties. I was saying, yeah, we won the battle. But far from saying we have won this war yet.
- [11:09]
NLW
Yeah, it's, it's a W. There may still be L's in our future.
- [11:14]
Scott Melker
Look at the market, man. I think everybody's feeling the L's at past, present and future. But one thing that likely will not be an L is stablecoin legislation. Seems like the lowest hanging fruit. The most likely thing we're actually going to see this is the US House stablecoin bill going live and a flurry of crypto activity on Capitol Hill, of course, following the Genius act from Hagerty in the Senate last week. And we know that there's multiple potential legislative efforts around stablecoins coming from both houses. Seems like there's a lot of consensus that something's going to get done. We just have to hope that that something is actually the kind of stablecoin legislation that we're looking for. But this is pushing forward.
- [11:54]
NLW
Yeah, no, there's, there is a huge amount of intent from both parties to get stablecoin legislation done. I think there's also a huge amount of intent to get market structure legislation after that done. There's just sort of more, you know, inherently complication there. One interesting thing about stablecoin legislation this week and I don't want to read too much into it, but Senator Kirsten Gillibrand was at the DC Blockchain summit and she was basically a part of. Her comments were effectively like thinking oppositionally and, and antagonistically about what could happen depending on different ways of coming at the stablecoin legislation. And keep in mind Gillibrand was, you know, a Democrat for common sense crypto regulation before other Democrats were.
- [12:38]
Scott Melker
Yeah, New York's Democrats.
- [12:39]
NLW
Exactly. She, she crossed the lines to, to, you know, to, to, to, to collaborate with Senator Cynthia Lummis on, on, on, you know, on, on their comprehensive crypto legislation when that was a very unpopular thing to do. So I think that you can very clearly count Senator Gillibrand and the list of allies. But there were a lot of her points that were being made that felt very like banking lobby sort of, you know, talking points. Right. She was basically saying that, you know, we probably shouldn't have interest, you know, yield bearing stable coins because that undermine local deposits in local banks and you couldn't have mortgages with that. Like just these things that are very, you know, you've heard every type, every time a new financial instrument that competes with people just putting their money in a bank comes up, it's this sort of argument. And what I couldn't quite tell not being in the was how much she was saying these are my concerns versus saying we're on the one yard line and now is the right time to think about everything that could be and really like nail this. And, and you know, she, it was clear that she was saying we, you as an industry don't want to screw this up. It's really important and if we have more screw ups it's gonna, you know, be a death knell for us. And I don't think that was, I think that I, I would from, from afar I took that sincerely as her actually saying we don't want to screw this up, you know. But it was still interesting to see at this late stage those sort of older, tired arguments re enter the conversation. So I'm a little worried that we have kind of a, you know, an 11th hour surprise coming in terms of some of the specifics of stablecoin legislation. But you know, we're in a better position to have those debates now than we were at any previous point in the past. So I'm sure we'll figure it out.
- [14:27]
Scott Melker
A lot of what you just said echoes, as a side note, some personal experience I'm having. I'm out of town with 13 of my friends from college. So you're Talking about basically 13 guys who are almost 50, most of them Wharton graduates or in some way on Wall street. Or were on Wall Street. And we got, of course, into the inevitable crypto conversation yesterday. And I can tell you that the sentiment from all of them is Bitcoin has been legitimized, but all they see in the media or think is that the rest of it is an unregulated speculative casino that's gone off the rails. And I think that her view kind of echoes not what we think when we look at the utility and the true use cases in this. Obviously, I've tried to set them straight, but it feels like we have Bitcoin and then even the legislation that we're looking for and other things might go the wrong way because of a view that. That this industry isn't serious.
- [15:24]
NLW
Yeah, I mean, we're not necessarily making that a lot easier on ourselves at this stage. I will say that it's been interesting. You know, I kind of had. It felt to me like when the Ethereum spot ETFs got approved, that Wall street might comfortably settle into this sort of notion that with Bitcoin they had exposure to the digital gold narrative, and with Ethereum they had exposure to everything else. Right. All the smart contract stuff. And it seems so far that Wall street just doesn't care about exposure to the non digital gold narrative at the moment. And I think that what, you know, the experience that you just recounted is sort of reflective of that.
- [16:06]
Scott Melker
Yeah. I don't think the news that BlackRock is tokenizing assets on Ethereum even hits their radar. It's important to us. We say, look, all these things are happening outside of Bitcoin, but that's an in one year out the other story. Because either they don't care or they just don't even understand enough to want to pay attention to that. So maybe that's a narrative that we're still early. Right. But I still have my doubts that when a, you know, Doge or Trump or anything else ETF drops, there's going to be much institutional interest in those things right now.
- [16:44]
NLW
Yeah, I mean, look, I think we were talking about this before. You know, we're just still, we are uncomfortably farther set back than, than we'd like based on the shenanigans of 20. The, the, you know, the institutions have been willing to move on as, as a whole and not really care that much because there's money to be made and they were structurally denied playing in this, in this playground for a while. But when it comes to individuals, most of their attitudes are still sour, you know, and it's, it's going to take more time.
- [17:13]
Scott Melker
Important to remember that our president launched not one, but two meme coins days before he was inaugurated. And then the Bybit hack was very much on people's radars. I think that's been understated, but I can tell you they all said we see is a lot of good news about Bitcoin, but then a lot of hacks and scams and meme coins. That's what they said. It gives me a good window into the problems we need to solve, at least from a narrative perspective. Some more good news here though. OCC ceases examinations for reputation risk and then to follow that, US FDIC moves to put an end to reputational risk following criticism from crypto industry. This is another banking and operation Choke point 2.0 story. Choke point 2.0. What do you make of the reputation risk, reputational risk story? What does this mean?
- [18:06]
NLW
It, it is, it's, this one is basically sort of, you know, unmitigatedly positive. The whole reputational risk idea was sort of a circular argument that you could use to, as a, as a bully cudgel to get people to do whatever it is that you, that you didn't want. Right? You say the thing that you don't like creates reputational risk which means that people can't do it because there would be more reputational risk. So it's basically an act of self fulfilling prophecy to say, you know, in, in our case, crypto is, is reputational risk. In previous administrations it was, you know, pornography or guns or whatever it was, right? So basically they say, you know, if you do any of these things there's reputational risk, so don't do those things. And people say, well I'm not going to deal with that. You know, what we saw with Operation Choke Point is that banks are, are creatures of opportunity and it doesn't take much for them to say screw that, I'm not going to deal with that particular set of things. No one's going to stand on principle on these issues. So this is the huge upgrade to just kind of get this out of the window also for beyond crypto. Right? This is Something that it, we have literally seen it deployed for other purposes other than targeting the crypto industry as a way to kind of, you know, to delegitimize a legitimate or at least legal industry. And so very, very positive overall. Kind of leave being that the hanging chat of bank regulators when it comes to unwind of, of, of operation choke point 2.0.
- [19:31]
Scott Melker
I can just tell you that from talking to my friends, I'm still suffering from reputational risk as a result of crypto. So maybe, maybe it's good that the government's not doing it. But I would have thought that here in 2025 it would have improved. But this is, to your point, very important. Even outside of our echo chamber, which is the only way that we focus, this is just common sense that this needs to be removed from the banking regulators tool toolbox. And I think that as you said we can cheer this as an unmitigated success. Another story here. Abu Dhabi's financial free zone signs MoU with chainlink for Tokenization framework. That's a memorandum of understanding for those who don't know. I recently interviewed Sergey from Chainlink and he had me exceptionally bullish on the future of tokenization. And it seems that this is really starting to bubble. Whether the Wall street guys understand it or not, this is yet another case where we do see real utility and the importance of this industries on the forefront with a major company country.
- [20:35]
NLW
Well, one of the things that's interesting about tokenization is that if you remember way back in the hinterland days when we were still dealing with operation choke point 2.0 and we were wondering what the next, you know, what the narrative, the positive narrative of the next cycle would be. This is also like sort of before Bitcoin Spot ETFs real world asset tokenization was the odds on favorite for that. Right? It was the thing that everyone was talking about as the likely next big narrative. Now the challenge with tokenization as a narrative has always been that it is not obvious or intuitive to people that simply tokenizing other types of assets on a chain actually increases the value that the value accrues to the token of that chain. There's a bunch of leaps that you have to get to in terms of understanding how these systems work to get there, right? Otherwise you're just well, well it's just infrastructure. Like I, I don't care about Swift. Why do I care about. You know what I mean? Like there's a, there's, you know, whereas digital gold is very clear, it is a OneToOne proxy for a thing that has value. Right. The token itself is the thing that is valuable versus the, the technology system that underpins it. So even if tokenization is a huge thing, I think it still doesn't necessarily a priori answer the narrative questions that come with it. And in fact, I think that there are a lot of folks on Wall street who are 100 absolutely convinced and sold that of course everything is going to be tokenized on chain because it just the opportunities that it creates for new types of instruments and new types of derivatives and you know, new type, new modalities of trading, like that's a sandbox that every Wall street person is going to want to play in. Like, obviously we're headed that way. Certainly this is, it's kind of Larry Fink's attitude with this, with, you know, like to him it is so clear that it's 100 inevitable. Again, it doesn't necessarily mean that, that there's clarity around how that, you know, creates value for, for the chains underneath. But this is, this is, this is this sort of world moving forward. Right? This is, you know, it's, it's Abu Dhabi continuing to, to try to aggressively place itself as, as a key hub for, for, for this sort of new crypto economy. So again, really positive thing that I think it wouldn't surprise me if in six to 12 months we look back and say, hey, there was an interesting tokenization story happening quietly that whole time, but we were so focused on the spot ETFs and the meme coins and Trump and all these sort of things that we didn't see this sort of seismic infrastructure shift that was actually in its early innings then.
- [23:00]
Scott Melker
I agree with that. Take that the adoption of the technology for this purpose is superior and therefore inevitable. But that doesn't mean that for your average person and it's going to be investable in a way that they're used to in crypto with some sort of guaranteed profit. Right. I think it's going to be spread out exceptionally far. Sergey's point when I talked to him was that he thought crypto adoption on its own maybe has another 2.3x in people who are going to come here and speculate and play in this sandbox, but that bringing Tokenization is a 1000 or 10,000 or 100,000x to what can be done with the technology coming in from the other side. Because once you tokenize things and people realize how powerful it is, and that's a superior way to transact and to exchange value, every asset will end up on the chain. But that doesn't really mean that a bunch of crypto natives are going to profit from it.
- [23:52]
NLW
Well, I mean, this is the interesting thing, like, if Wall street gets there, it's like the value proposition is no longer about the speculation. It's about gas fees and, you know, whatever. Like the ways that these chains actually are economically designed to make money from that activity. And so the funny thing is that it actually gets it right back in the realm of something that Wall street can understand. It's just that so far, crypto has been so tied to what is the actual value of the token itself, the end unit token, not as a productive asset, but just as the thing. Right. I mean, we've spent years arguing, at least I have, that the sort of the pet rock version of Bitcoin is like, its point is to be a pet rock. That's fine if you're looking at it as digital gold. It's allowed to be that. That's not a dismissive thing that is doing exactly what it's supposed to do. It's holding your. Holding your value. You know, you know, and, and I think that there's. But there's always been this bifurcation between, you know, is it. Is the token the thing or is the underlying technology the thing? And ultimately, I think it actually is a better financial story if Sergey's right and we have a thousand times the activity because that the. The business model is implicit and it just actually makes money and it actually is valuable in those ways versus it just being people betting on that being the inevitable future and so kind of trying to price it in now and speculate early.
- [25:14]
Scott Melker
Well, Petroc's actual ones have held their value better than most of the things not named bitcoin in my portfolio. So maybe I should start investing in those once again. We had a few honorable mentions here as we sort of come to the end. Of course, the US SEC holds Crypto Task Force Roundtable as. As Trump plans regulatory revamp and even to further that story, you can see the schedule here, but there's four more of them through May that are already being planned and hosted. So very clear, once again, that the sec, and maybe that's a proxy for the entire administration and legislators and regulators are looking at this industry seriously and actually talking to experts and leaders in the industry for feedback on how to move forward. Just really encouraging. And once again, one of those zoom out and remember where we were at 18 months ago situations.
- [26:05]
NLW
Oh, my God. If you, if you look at Hester Purse's speech from the blockchain summit this week. It is like 2,000 words of, you know, every single sentence is another to do list item of how they make it work better in the future and how they deal with regulatory overlap. I mean it is, it's almost, it's boring in a lot of ways because it's not big bobastic speeches about how they have to change and, and things like that. It is just like, all right, so how are we going to deal with the CFTC and the SEC having similar jurisdictional issues here, like 0.1.2.3. No more time to explain that because I got 50 other things like, and if you actually take a step back, it is so, it is so action oriented. And I think you see that in the, in the, in the roundtables too. The roundtables, unlike perhaps White House summits about crypto are there's like a detailed agenda with very specific stuff, you know, and, and I think that if you're looking for the actual sort of like positive actions, that's, that's where you should look.
- [27:03]
Scott Melker
100% agree. And while we're talking about legislation and regulation, we've got Rep. Emmer and Soto reintroducing Securities Clarity act as Congress eyes crypto legislation. So important to remember that stablecoins may be the low hanging fruit, but this is somewhat a precursor to market structure which I think could be even bigger when it comes finally defining what these assets are, what, what baskets we can put them in and how companies can move forward in that context. So nice to see that we're moving forward basically in every arena.
- [27:32]
NLW
Yeah, I mean, and this one is, this one is the most valuable thing to have as its own focus as well. Because if we could, if we could get nothing else done, but we could for once and for all get clear on securities designation and, and, and figure out actually how to allow for securities like behavior in some cases with clear, you know, guardrails. This is, this is the lingering question has been forever. It's the number one thing and any market structure legislation that doesn't deal with this will be incomplete. And, and so, you know, I think Emer and Soto are, are doing two things simultaneously. One, they're trying to shape that part of the conversation which is so important. They don't want to wait, they want to get it going right now and want to actually try to like, like have their vision of that. You know, they want to plant their flag. But two, they're also hedging if you can't get the whole market structure thing done. You got this thing that you can fall back on and it wouldn't be a bad consolation prize to at least get that through.
- [28:32]
Scott Melker
I agree. And the final honorable mention story here, ripple to get 75 million of court ordered fined back from SEC drops cross appeal. This was one of those interesting scenarios where we saw the SEC continually dropping every, every single case or decide not to pursue them, including I believe crypto.com just in the last couple of days. And here we had Ripple kind of negotiating behind the scenes for a better deal when they saw the way that the winds were blowing and looks like that's exactly what happened here. This is dead. And they got some money back.
- [29:09]
NLW
You know, throw, throw a big party, guys. We're waiting for our invites.
- [29:13]
Scott Melker
Yeah, seriously. Well, apparently that was the White House crypto summit. It didn't look like a very fun party to me. Guys, that's all we've got for you today. NLW are gonna go and I are gonna go have a dueling piano concert in the back. It's gonna be amazing. But we're not going to broadcast it for you. I'm sorry. Give NLW a follow on X and check out the breakdown. That's all we've got for you today, man. Thanks and see you next week.
- [29:41]
NLW
Later, guys. That's dope.