← The Wolf Of All Streets
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- [00:00]
A
Good morning, everybody. Welcome to Crypto Town Hall, 10:15am Eastern Standard Time here on X. Dave is on vacation skiing. He just did macro Monday, but he's not going to be here this week. So you have the unfortunate fortune of having to listen me rattle on with our few guests. Sorry in advance, some housekeeping. We're actually reducing the days of Crypto Town Hall. It's no longer going to be a daily show, at least for now. Obviously we are conscientious of the fact that the conversation can be a bit redundant when the market is down, but more it's about bandwidth, obviously. Mario and Ran, originally partners, have long since gotten way too busy for Crypto Town Hall. I've been carrying it alongside Dave. So we're going to drop down to Monday, Wednesday, Friday for now, and then we can always add days when the market is more exciting or we feel that there's a more robust conversation to be had. We just want to make sure that the shows are great and that there's topic to discuss and that we're well prepared and have a full panel to do so. So you can look for us for now Monday, Wednesday and Friday. Obviously we have the market as the probably first topic, but it's hard to discuss bitcoin right now without trying to figure out where it fits into the macro. We have the Supreme Court decision to basically strike down Trump's tariffs last week and then Trump's response, you know, largely saying he thought that the Supreme Court was now captured by foreign ent. Okay, he went ahead and just raised tariffs from 10 to 15%, sort of giving a middle finger to the Supreme Court in general. And now there's questions as to what he can or cannot do and what that's going to mean in the future. I think one more story that just means we have more uncertainty and we know that markets hate uncertainty. Of course, we have our largest military force in many decades sitting on the doorstep of Iran, many people waiting for airstrikes. There a lot of question as to what the narrative is for the reason for that, which I guess we could discuss to some degree. But what everyone wants to know, I think at the end of the day is what that means for crypto markets. I mean, bitcoin is trading down, but sideways 66,000. I think we had sort of the breakdown below the 70s level and have sort of consolidated here. So waiting for a more clear direction and as usual, altcoins somewhat down more than bitcoin with time. So that's kind of where we're going to start. Here we can discuss price action, what could possibly, possibly be catalyst to get the market going in either direction, or we can just start right at Trump and tariffs. So I think that that's largely, like I said, just causing more uncertainty, and markets hate uncertainty. So I'd love the panel. Go ahead, Carlo, to jump in and tell us what's going to give us some certainty here.
- [02:56]
B
Good morning, Scott.
- [02:58]
A
Good morning, Carlo.
- [02:59]
C
All right.
- [02:59]
B
Well, I've been thinking a lot about this tariff thing and was talking about it a little bit on the morning finance show. I think what we're seeing here is that the Supreme Court, in taking their time in releasing this opinion, remember, there were a couple of deadlines that were, that came and went for when the court could have. Of course, the Supreme Court has no deadlines, but, you know, they had their days where they could have released this opinion and they sort of punted it. And I think the reason they did that, Scott, is because they realized that this was going to trigger a backlash from Trump and they needed to craft this opinion in a way that would avoid, I haven't gone to the extent of saying constitutional crisis, but a definite constitutional showdown, because they fully, I think, anticipated that Trump would be furious with the decision since it is the linchpin of his economic foreign policy. And they wrote the opinion, but they also included dissenting opinions. And Kavanaugh's dissenting opinion set the table up for a pivot from the White House where, yes, the initial vehicle for the Trump tariffs was found to be invalid and outside of the scope of executive power. But Kavanaugh, as has been widely reported, basically said, hey, you can do this. You just check the wrong box. You can do it under these temporary tariffs, under this other provision in the law. So that avoided this becoming worse of a showdown than it could have been, because if Trump would have refused to back down from the tariffs, even if the Supreme Court said they were not valid, that would have triggered what many would have looked at as the opening of a potential showdown between the court and the executive branch on who has the power to do what. And if Trump refused to follow the court's decision, that's obviously troubling. Looking down the road to markets, I think there are going to be businesses that will try to claim the damages caused by the tariffs in respect to the actual tariff dollars. But I think the government's going to enjoy a degree of immunity from lawsuits attacking lost revenues, lost customers, so on and so forth. Now, the decision is going to be on every business. Do they want to step forward and try to make a claim for those tariff paybacks. One of the crazy things about it that I'm thinking about to Scott is that, you know, businesses raised prices, made money off the tariffs. Yeah, it hurt their bottom line. Yeah. It hurt their supply chain. But if they get to retain the profits and also go back and make a claim against the tariff, the tariffs, now that they've been deemed against the law, let's say they're kind of double dipping at the expense of the taxpayer because now the taxpayer is not only getting hit with the increased price of goods, but is also having to absorb repaying, which is just going to add more to our already exploding deficit. So I don't know how the hell you trade this, because the bigger, broader takeaway is if we could just stop with all the chaos and let the markets sort of run, we probably would be in a different place right now. But with this continued not only global tension, but now this economic tension, we just seem to stall constantly. And all this uncertainty is not good for markets. They don't like it. Yeah.
- [06:26]
A
And Carlo, I mean, the bigger, and maybe I think a parallel narrative to that is obviously that everybody's just waiting for this massive deluge of liquidity to raise the price of crypto markets. Right. Everybody is showing the charts of how it's so correlated to liquidity. While tariffs were supposed to be the way that the United States was going to run it hot and basically grow our way out of these deficits without tariffs, what does that mean? Kind of resetting back to same old, same old. And listen, I'm not necessarily saying I'm a fan or not a fan of tariffs. I'm just speaking in strictly a narrative. But if that revenue is gone, we go back to having an even bigger national debt crisis.
- [07:09]
B
Yeah, it's not only the elimination of that, quote, revenue, it's now the possibility of having to increase the deficit to make up for the shortfall because it was not lawfully executed. And look, it also presents a leverage point for other nations in negotiating with us on trade deals because they know that the new tariffs have an expiration date. And now we may have pushed this constitutional showdown a little bit down the road because when those tariffs expire under the law, presumably Trump has to go to Congress to reauthorize them. And we all know what that will look like. So, yeah, this introduces an element that is pulling down everything, including Bitcoin. And there are a lot of people in the timeline who are obviously observing this, that bitcoin is supposed to respond to this volatility and act as digital gold and it's not. It's acting like a tech stock and it's responding negatively to all of this. And I think my take, I think that it's just a lagging indicator. I still think that bitcoin and Scaramucci posted something interesting about that today that he, that he commented on this, that you know, essentially bitcoin is I think in the end going to be vindicated. Although it's certainly going through its own awkward period here. Scaramucci's direct quote. The strongest version of the bull case for bitcoin and the one I think is most intellectually defensible is this. Bitcoin is a bet that the 21st century will need a neutral, non sovereign digitally native store of value and that nothing else credibly fits that role. Given the macro trajectory of debt, money printing, AI disruption and geopolitical fragmentation, that bet looks more reasonable with each passing year, not less. I tend to agree with that take.
- [09:09]
A
Yeah, yeah, I was going to say that I wish Dave was here because his favorite talking point is Bitcoin is an option on its own future adoption. Right. And that's effectively what Scaramucci is very eloquently saying here. Jw, go ahead.
- [09:24]
D
Yeah, I love the Scaramucci language. That's a great way to put it. I'm still wondering if bitcoin is going to be that alternative. To me, the real question for the future is what medium of exchange is agentic commerce going to use? What medium of exchange or AI agents going to use? They're still nascent. Open Paw is doing cool stuff. We're all playing with it, but once
- [09:48]
B
it's going to be right.
- [09:50]
D
Yeah. What are they going to want to use? Are they going to be interested in Ethereum, Solana? Are they going to find a way? I mean, bitcoin can't scale. Now, most stuff can't scale without L2s, but what blockchain are they going to prefer? And I still don't know the answer.
- [10:06]
A
Stable coins, most likely. Stable coins, you'd have to imagine they're stable coins, but that maybe JW plays into the old bitcoin as your savings account, stablecoins as your checking account narrative.
- [10:16]
D
Well, I don't know.
- [10:17]
B
That sounds like something I said here.
- [10:19]
D
The least private is stablecoins. I mean, stablecoins are as bad as Bitcoin on privacy.
- [10:24]
A
So zcash. I know you're on the zcash foundation, right?
- [10:27]
D
I don't want to talk my own book. I do I think privacy will be a component and to me the question is, is it going to be zcash or will it be privacy add ons to ethereum like Aztec or whatever? I don't know. But that's what I'm most curious about. What will AI agents, once they kind of take over the economy in the next year or two, whatever, what are they going to prefer? And I still don't know.
- [10:47]
B
Can I respond to that briefly, Scott?
- [10:49]
A
Yeah, of course.
- [10:50]
B
Hi Professor. So yeah, I understand and I think a lot about this too because I think the narrative that I'm seeing recently among the bitcoin community is that stablecoins are an extension of the surveillance state. And you and I obviously understand that the Bank Secrecy act applies to across the board when it comes to stable coins because there's no different than any other bank offering or bank monitored currency. So we're going to see that surveillance layer when it comes to stablecoins. I, I think about this from the perspective of micropayments too when it comes to AI agents because I think the one thing that stablecoins lack is they're going to be divisible down to, you know, pennies because they're still dollar denominated. So I still think there's going to be a cryptocurrency layer to the AI agentic community and their commerce because you're going to need to get much more granular in the way these micropayments work in a way that I don't think JW stablecoins can, can necessarily solve for. I think they'll be a blunt instrument for agentic payments. But I think the advantage the stablecoins have over everything, including Bitcoin is they're pegged. So if you want to eliminate the volatility, the price you pay is the obviously the anonymity component. But you do get something that is presumably pegged to a dollar equivalent asset so it's less likely to have those fluctuations.
- [12:20]
A
JW any thoughts?
- [12:23]
D
No. It's interesting thesis Carlo. I hadn't thought about the micropayment issue and stablecoins are limited by one penny where crypto isn't. That's a, that's a neat, that's a neat angle. Really cool.
- [12:36]
B
And you know my, my mantra going forward and the more my, my thinking evolves on this for the consumer and for the business. I, I've been preaching it for a long time. I think that the, the strategy as far as I see it is you want to stack in sats, you want to Spend in stables and you want it as much as you can make your wallet your bank, because that's the best way to play the hedge. The dollar's not going away. You cannot run a business in this current economic framework where you're accepting Bitcoin and fully on the Bitcoin standard, because you're going to lose 98% of your consumer base because people don't know how to use these assets yet. People don't have Bitcoin readily available to spend on daily consumption needs. So you need a bridge. Stablecoins are that bridge because they're digitizing the dollar and they're making this stuff all move on blockchain rails. But I don't say that to say that they are the ultimate solution because they still don't solve for debasement. They still don't solve for all the other problems that we have with fiat. Which is why I think on the other side of that, you need to be mindful of what is the solution to that. And if you believe it's gold, you believe it's Bitcoin, I don't care. But you should have some kind of a hedge because obviously we're getting digitized dollars whether we like it or not. They're not going away. They do come with surveillance to touch on what you had touched with Christian Carlo Scott. You know, look, that is baked into it. You not only have private sector surveillance, but you also have government surveillance over these things. But it's no different than what we exist in right now with credit cards and banks. Anyway, they surveil across the board and the government sees it all. Anyway.
- [14:18]
E
Did you, did you say my name?
- [14:19]
A
Well, I. I did.
- [14:20]
E
Oh, okay. Cool, man. I was just gonna say like, with like layer twos on top of ethereum. Ethereum, like the base of the rails for stable coins. And then things like Polygon and other chains that are really focused on moving stable coins I think will be probably the winner in like where all this gets transferred from and to. And everything else. But then to jump into kind of what I was. I've been kind of trying to short the market, thinking that, you know, the entire market will probably drop off. I wanted to know what you guys thought about, like, if we do go into Iran, how that would look for the overall market.
- [15:00]
A
Well, I can tell you that historically and it's something we discussed on my other show this morning. But generally markets hate the uncertainty of the lead up to war. So this is usually when you would want to be short. And the minute the bombs start Dropping. And this is not, this is a. Just based on, I'm not saying it should or should not be this way. Markets tend to actually rise and do fine again because there's certainty as to the situation, as strange as that is. So you don't want to short the start of the war historically, doesn't mean it will happen the same this time. But historically, a, there's money spent if it's a full scale war. But B, markets then have the certainty that the war has started and they go about their, their business strangely.
- [15:38]
E
Okay, no, that's a great advice, Wolf. I appreciate it very much. And then I was also, you know, do you guys think, like, obviously there's not going to be a lot of winners in a lot of these different altcoins over the next few years? You know, I think a lot of things are going to go away that are, don't really have any use case. But, you know, one of the big things like you guys have been talking about is the use case with, you know, stable coins. So I think some of the winners in altcoins might be those focused on actually, you know, money, remittance and micro payments and the ability to, you know, transfer money. I, I don't understand where you guys come in with like the penny thing because, I mean, basically, even though it's pegged to a dollar, you can basically trade, you know, stable coins down to almost, you know, just point, point, point, point. Right? Or am I wrong? Richard?
- [16:32]
A
Yeah, no, Richard, please go ahead.
- [16:35]
B
I'm thinking about that. This is something that was debated in a bitcoin space that was, that got my wheels turning about this very issue. The satoshi seems to be more fractionalized than the stable coin. But Richard, what are your thoughts?
- [16:48]
F
I was going to respond to Tom because I'm just waiting for a topic to come up that I could speak to. I think, Carla, you guys were covering the tariff thing way better than I'm equipped to do. So I just wanted to respond because I'm always looking forward to what the future represents. I mean, we've been in crypto long enough to know that it's endured so many different setbacks. And for me, this is no different. It's just a different version, a different time, a different narrative. But I was fortunate enough to have been invited to the World Liberty Forum at Mar A Lago last week. It was quite an experience. And the first thing I was struck by was this wasn't your conventional crypto conference where you've got founders really trying hard to promote their New protocols or projects or just some kind of a partnership rehashing of existing, existing projects and new associations. There were genuine industry leaders from the traditional financial sector that were speaking very candidly. And I think it was really refreshing to listen to senators and CEOs of large banks. And I understand that there are other conferences maybe that have this kind of flavor, but certainly if you go to a token 2049, whether it's in Dubai or Singapore, Weber, you know, the tone is very cryptocentric and you know, I grow wary of having to sift through that noise and try and really get to the nuts and bolts of where we're at. And I mean, we do talk about a lot on the show about what's taking place, current affairs with, you know, regulation and stuff. But I was very. I came back feeling really optimistic with the honesty that came out of the various speakers. In particular, David Solomon, the chairman and CEO of Goldman Sachs. I mean, you can understand that even though he's probably speaking to a lot of pro bitcoiners in the room, he was exceptionally honest about where they're at. And that is that parity is such a critical hurdle for our industry. Whilst I think tariffs represent a headwind, they represent a headwind for most asset classes in some shape or form. But for crypto specifically, which is what I'm genuinely interested in is where are we? We're going to be incumbent to general macro conditions, geopolitical tensions. We've seen this over and over again with various different things that have played out, but specifically for what everybody's anticipating, and I mean the speakers there were profound. I mean it was. Brian Armstrong was speaking and we had two senators, Senator Moody and Marino from Florida and Ohio. I was very encouraged that what everybody's anticipating is that clarity will happen. They're obviously stressing the importance of it happening as soon as possible. I can't remember who it was exactly, but someone made a prediction that roundabout April they're expecting and I can't remember what the exact pretense was, but what for it to be wrapped up.
- [19:48]
A
But I saw that Garlinghouse just, just this was the clarity. He said 90% chance. That was like a big story last week. I don't know if that's what you're talking about, but yeah, so it was,
- [19:58]
F
it was, it was real people managing multi trillion dollar portfolios that we're not fobbing off crypto, but really specific looking at the effectiveness of stablecoins and its necessity really, which was what was probably the big takeaway was them all recognizing that blockchain. So remember why we got into crypto in the first place. It was always this revolutionary underlying technology, as simple as the open ledger, transparent ledger, decentralized ledger concept was. I mean, we've iterated so much in the last decade plus that we've lost focus. And it seems to come back to basic principles of this one particular rail of blockchain. And I'm exceptionally optimistic about what's coming. I think it's going to take time, and for me, this is just another season of regrouping, refocusing, and making sure that you're on the next move. And someone made a very good statement. They said, you know, that you want to be on, on this train. You know, don't. Don't get in. In the way of it. Get onto it. And I think that's where we are. You know, we just got to keep moving along with this train, however slow it's going at the moment. You know, once clarity passes, I think it'd be a big moment where someone said 1 to 3% of portfolios could easily flow back into. Into crypto. Once this regulatory hurdle has been overcome,
- [21:28]
A
we can. I don't really want to move on from that. I think it's interesting that you were there, and I know Rand was there as well. We never really got the time to unpack it with him. But did you have the feeling? Because I've been to a lot of these type of conferences. I was at Bitcoin Investor week that pumped it in New York two weeks ago, and it was very similar, Right? It was kind of the big names from banks in the crypto industry not talking to retail, polarized opposite of a token 2049 or Bitcoin Vegas, where it's heavily retail, wondering if their bags are going to pump. And I'm curious if you felt like a David Solomon, for example, Right. I think he had the sound bite from that conference where he said he owns a little bit of bitcoin, right? Which is something you would buy a little bitcoin. You would buy a little bitcoin and show up at the bitcoin at the World Liberty thing and say you got bitcoin. It's like, you know, Trump on stage in Nashville saying fire Gary Gendler and then saying it again when he realized how good of a sound bite it was. So I guess the question is, did you feel like a guy like David Solomon? Do you think that he was there, somewhat pandering, or do you feel like he really gets it? Because I think that there's a very long kind of scale of. With Larry Fink on one end. Because Larry Fink talks like he's Satoshi Nakamoto at this point. Right? No.
- [22:43]
F
So for the record, to finish that quote, he owned very little bitcoin, but he owned no gold. And I don't think he was pandering. I think what he was was a consummate CEO chairman that was representing the best interest of his company that he's running and effectively said, we will do what our clients ask us to do. And right now, and specifically around crypto is the ability to facilitate that need. But we can't do it without clear guidelines from the sec. And therefore we need this final act to be passed. And that was, for me, a very positive takeaway. Irrespective of whether or not he owned a minuscule amount of bitcoin. He was saying that there is demand and that they need to facilitate that demand.
- [23:31]
A
Right. And that's even supported by a Jamie Dimon, a JP Morgan, for example, who actually hates bitcoin. Right.
- [23:37]
F
And he's the same thing.
- [23:38]
A
I'm a CEO and my customers want it so.
- [23:41]
F
Well, I mean, BlackRock are smart enough to recognize the sheer volume of fees that they could inherit as a result of running the etf. I mean, speaks for itself. Don't overthink it, guys. I mean, if there's a demand and you can make money out of it, why fob it off?
- [23:59]
A
Yeah, I agree. And I think, like I said, I just think it's a scale because I think that's kind of how Larry Fink probably started. But even anecdotally, from stories I've heard about Robert Michnick coming in and basically orange peeling him, the comments he makes about a hyperinflating dollar are not about fees. I think he gets it to some degree. Whether he wanted to get it or we want BlackRock involved is a totally separate conversation. I just wonder where the other CEOs are on that sort of trajectory. I mean, Richard, seeing that you were there, unless anybody has specific comments on this, what were sort of the most compelling other speakers? I mean, like you said, Brian Armstrong was there. I saw CZ was there. I mean, it was heavy hitting.
- [24:40]
F
CZ wasn't on stage, Brian. I've heard him speak quite similarly, you know, on CNBC and Bloomberg. So I think he was just going through the motions, knowing very well that he's a big part of the mouthpiece for crypto in general. So I think a lot of his stuff, for me, I was familiar with and you know, obviously very strong, strongly advocating for, for the need for these, these regulations to happen, that they're stifling the industry. For me, what was more refreshing was listening to particularly those two senators was unbelievably. I want to use the word clarity because it's a bit ambiguous, but the clarity of mind of what this space
- [25:23]
A
was downloaded via spacesdown.com visit to download your spaces today of how they were
- [25:29]
F
referencing crypto was super positive. And that for me was a one off experience. Just hearing it right from the people at the highest level that are up there voting these laws into effect was significant. I really enjoyed both speakers from New York Stock Exchange and nasdaq, Lynn Martin and Adina Friedman, and even Jenny Johnson, the CEO of Franklin Templeton. Powerhouse ladies. Absolute powerhouse ladies. But I suppose the conversations did kind of pivot into AI quite a lot because those were a lot of the questions that were. It wasn't just purely crypto. I think what everybody was trying to ascertain was how are you dealing with this rapid change of technology? And it was quite refreshing as well to hear major business leaders that are themselves going out and trying Claude, for example, and not letting the understudies come to them with revelations of what they're finding with this tech is like just encouraging people to, to use it, that it was as new for them as it was for us. And everybody's confronting this, you know, this, this wave of change that we're confronted with, in particular with AI. So yeah, I mean, I don't know if you've got any other questions, but yeah, once again, I can't speak highly enough about. Someone just said this was the davos of, of crypto because for once we've got.
- [27:04]
A
I accidentally muted trying to scroll. Go ahead.
- [27:07]
E
Sorry.
- [27:08]
F
No, no worries. I mean, it was basically just that I would conclude with that statement that the comment was. It was similar to the Davis of crypto. So very, very mature, sophisticated minds talking about the future of crypto, not the now, but the future.
- [27:24]
E
Can I say one thing real quick? I was gonna say, I think once banks are able to store, you know, especially for the normal person, your Bitcoin, Ethereum or maybe all the coins can completely, or just at least the main coins, I think that'll be a big boost for the normal people to be able to come into the market as well. Because I feel like security is one of those things when I do talk to a lot of normal people that they really have a problem with, you know, and they feel like you Know, crypto is very risky in that sense.
- [27:59]
A
Yeah, I think I tend to agree. DB I see you're throwing up the hundreds there. I know that you're always talking about and thinking about security and the problems that we have that may, you know, prevent mainstream adoption.
- [28:13]
G
Oh, for sure.
- [28:14]
A
Yeah.
- [28:14]
G
It's my primary area of focus and it, I've said it many times before, it just, the space is not ready for the adoption that many of us want to see. It's not user friendly, it's not secure. There's so many attack vectors and the primary tools and even chains that many of us use on a daily basis are part of the issue and. Well, yeah, we can go down that. But yeah, it's interesting discussion for sure. I know one that Dave would love and I'm looking forward to watching your morning, Monday morning brief once I go to the gym in a little bit because I want to see him and James and Mike go back and forth as usual.
- [29:01]
A
We didn't fight as much this week. We had some catharsis last week with the rage quit event with Larry Lepard. So now we're.
- [29:08]
G
Oh yeah, that was quite the spectacle.
- [29:10]
A
Everybody was slightly, everybody was slightly subdued today and Dave was trying not to wake up his wife who's in the next room. So it was a funny day. But he definitely had some good takes. I mean, we really dove mostly just into, you know, the macro side tariffs in Iran. I mean, the Iran situation is somewhat wild as well, but. Jamie, go ahead.
- [29:28]
H
Yeah, just real quick on the clarity act like I just see like, like that, you know, zero benefit to the Democrats or the banks to cooperate in any way with like passing this bill. I know they, you know, they promised we were going to get it last year, then they promised in January, now February, now it's been through April. I think a lot of it is a lot of marketing, a lot of trying to keep people, you know, and in the news and keep people encouraged that this isn't going away. But like the Democrats have no majority. They don't have the administration. You know, like, if I'm just thinking strategically, you know, pushing this as far as they can, you know, through the midterms, maybe the Dems break the majority and then, you know, Trump's essentially neutralized for the, for the next two years. So, you know, you know, maybe the Democrats get the administration next election, maybe maybe the Dems get the majority, who knows? But like, you know, to me, the banks have no, like an enormous benefit in waiting this out indefinitely. The yield, the banks can capture deposits that they will protect from leaving the banks by users who are chasing yield. I mean, but ultimately, I mean, defi is not going anywhere. And people who want that yield and who are exposed to it or will become exposed to it knowing that there's some additional yield that they can get out there, banks are still going to have to figure out a way to deal with defi that's not going in regardless of this clarity.
- [30:56]
A
Yeah, I was going to actually say, Jamie, you raised such an interesting point because I think I can see both sides of the debate on where the banks stand on clarity or what they would want from it. I wish that I could remember. I talked to so many people. But which guest kind of broke down the other side of this? I think it was on my show or maybe in another interview. But basically you're correct in that the banks to one degree have zero interest in rushing this or giving the crypto industry any concessions, certainly on anything that could affect their bottom line, like yield on stablecoins. But the flip side is that understanding the inevitability of stablecoins and the technology, they actually can't participate until they have, no pun intended, clarity on what they are allowed to do as banks. So I would say that if you're thinking about that rationally, that there's kind of two sides. What the banks would ideally want is to actually pass a Clarity act that's a bit of a Trojan horse and looks and smells like a crypto bill, but is really bank protection and ability to do what they want with it bill. And I think that that's to some degree where Brian Armstrong is coming from when he says no legislation is better than bad legislation. That's a good point.
- [32:10]
H
And I think it was interesting too. Like, like as this is going on, and I don't know if it was kind of like a strategic little marketing or public. I don't even know how to describe it, but I did see that coinbase offered a 3 1/2% bitcoin yield like this weekend.
- [32:28]
A
Like it was like the same day it was last week. It was like the Y. I mean, and he kind of made that quip like, you know, sometimes it's the small things that make a big difference. It was, it was a very. Yeah, I mean, he's not afraid to continue offering the products that they are and continue rolling this out while there's suspense block. Prof. Go ahead.
- [32:50]
D
Yeah, I was just going to say the Clarity act is. Has an uncertain future. Everybody's optimistic. But, but the odds of major Financial services deregulation are always low no matter what. In the post Dodd Frank era, it's just always low. And you would have to resolve the yield issue or the rewards issue. And it's very scary to me, not just because it affects coinbase, but because I think the banks would eventually use it to prohibit rewards or yield or whatever you want to call it in defi as well. And then you got, so you got to get past that. You got to get past the fact that some of the provisions in the last negotiation with the Democrats were sort of kind of hinting at, or could be interpreted as, and were interpreted by staff at treasury as adding KYC obligations to defi front ends, which hopefully, as the tech evolves, will be less dependent on defi front ends and agents will be able to access the protocol directly. We won't need front ends, but for now we do need them. And putting KYC obligations on front ends is very scary stuff. And then once you run past that, those two gauntlets, you still have to get to the conflicts issue with the Trump family. And the Democrats weren't letting go of that, especially as the midterms come close. So, man, the odds are low. I hate to say it for everybody working so hard on Clarity, but the odds are by low, I mean like single digits.
- [34:17]
A
Yeah, I think so. I've said sub 5%. Yep, I think so, too. And by the way, I think maybe it's worth discussing, the point that Witt made when Brian Armstrong said no bill is better than a bad bill, is that he said, well, a bad bill passed by this government versus a bad bill passed by the next version of this government, maybe something you would want, which I think is an interesting nuance. If Elizabeth Warren is the head of the Senate Financial Committee and we get the Clarity act from that version of the government, it could be even worse than the bad bill we're having proposed now. Right?
- [34:54]
D
That's true, that's true. But maybe no bill either way is best. Look, if you've seen, seen comments from, from Scott Besson, as much as he's been like 90 useful to things I care about on AML KYC stuff, he's still not helpful. And the Trump DOJ is very much not helpful. The, the Blanche memo is meaningless because they still, they still put my guys in jail for the things that they said they're no longer prosecute people for. It's the ultimate rug pull. So I don't trust this administration even implementing the, the sanctions provisions of Clarity in a way that's reasonable. That's my concern. I mean, I trust that. I trust the SEC and the cftc and, and I think Atkins and Selig are great. And, and I. Maybe the best outcome is just the two of them giving us as much, much exemptive relief as they can. And then we'll fight to defend the exemptive relief later.
- [35:50]
A
Yeah, Matt Hogan somewhat made that point, recently, said, you know, let's start thinking about a world without the Clarity Act. Well, we do have three years of favorable regulation where potentially they can move this forward enough that it would be the better case scenario. I mean, it's kind of what you're saying here, right? Yeah.
- [36:07]
B
If you think about it, Scott, if the SEC doles out a bunch of clearance letters in the next three years and sets a precedent in motion that basically acknowledges what these assets are and how they work within the securities infrastructure that currently exists, it's going to be hard for, even if we do have a shift in power to justify completely turning that paradigm on its head. And at the end of this, even if Clarity dies on entry because of the ethics provisions and because the banks, I think, have hijacked the conversation to make it all about a backdoor to try to rewrite the Genius act, we still have the Genius act, and I don't think there's anything stopping the disruptive nature of stablecoins when it comes to banks. So Coinbase is, I think, hedging themselves for how they're going to survive on the other side of this, and they're still going to find a way through their base wallet, through their defi wallet services, to give the consumer access to yield and quote rewards on stablecoins in the DeFi environment. Nothing in Genius act prevents that. And I think the banks have overplayed their hand here pushing this narrative that they're here to protect community banks, which they're also pretty much putting into extinction. And this notion that they're going to have this massive flight of deposits if this happens is frankly necessary, and it's coming one way or the other, and they better prepare for it. I know they want to try the best they can to preserve their fee extraction model, but I think there's going to be too many competitive alternatives out there.
- [37:37]
A
Scott Carlo, I think it's worth mentioning, and this doesn't mean that anything Armstrong or Coinbase has said is disingenuous, but Coinbase is in a uniquely positive position right now for nothing to happen. Because if nothing happens, they are the one that's already offering, quote, unquote, rewards, AKA yield And nothing is stopping them.
- [37:56]
B
Yeah, because they have an amazing arrangement with Circle and USDC and they could just continue to play that game under the Genius act and the banks end up losing market share either way.
- [38:09]
A
Tom, you've had your hand up there for a while.
- [38:11]
E
Yeah, I think you guys went right into what I was talking about with fee or what I was going to talk about with fees. You know, I really, I really dislike Coinbase. I feel like, you know, they rob their customers overall in a sense of just high fees, being able to swap things. They just take advantage of their customers in, in a big way and I can't wait to never have to use them again. You know, I really liked Binance before I was kicked off their platform a long time ago. But at the end of the day, like I think competitors are really going, going to help the market overall solve, you know, the customer being taken advantage of at this point, you know, because I just don't think it's very fair at all that, you know, Coinbase is able to get away with what they do, you know. So I was wondering what you guys thought about that. And then also, you know, I think once you're able to deposit straight into banks and there's competitors that, that will help solve like kind of like what you guys were just talking about.
- [39:14]
C
Hey Tom, appreciate your viewpoint. I, I must say I have a really different view on this one. I would, I, I very surprised if regulation passes here. I'm a big believer in no regulation is better than a bad regulation on the Coinbase side. And I appreciate the viewpoint of, you know, sovereignty and centralization. But Coinbase has done more than any company to invest in lobbying for an education across the world about Bitcoin and like what we should be doing right now. And I think a pause would be really good for us to take the time because we're not centralized to all kind of get together and realize what we should be doing is educating the public that major banks, the entire oligopoly is spending millions and millions of dollars in lobby to defend a 3 1/2% margin they're making that they sh. The consumer should be receiving. This is a awesome marketing opportunity along with an education opportunity. So many different educations too. Hey look, crypto is going to give you a yield. The banks are trying to stop it. You're getting raped. Why wouldn't you want this option? I thought America was a free marketplace. The banks aren't allowing competitors in. This is an. But we are not centralized and so we act like we're jack off kings talking about all kind of different things and this is why we're getting delayed really. It's so frustrating. And like this is an awesome opportunity to educate the world and we're banging our head against the wall and without that community bitcoin price does nothing. Just one last thing, I just want to, I think I was wrong about the four year cycle. I think the four year cycle is intact but it's wrapped around. It's not about mining. It's about the 4 or 5 million coins that were bought below 500 bucks that must come into the system and it's happening now. I've always believed these coins are going to come in the system when prices are going down, not up. And that's what's happening. So let's wash it out. I think we need to wash out get 2 or 3 million coins. People get in a fiat, they go buy real estate, they, they diversify their 300 coins into something more realistic for them and, and we move down the road. But until that happens I, I, I see us just grinding in the five digit range for quite a while here. We love some other people's input on that.
- [42:04]
A
Gentlemen, have at it. Raise your hand or just jump in.
- [42:10]
H
Yeah, I mean listen, I had Benjamin Cowan, I got an opportunity to interview him this week on one of our spaces and you know he was in the same kind of mindset as what Gary is, is talking about. He, he, you know he, he's in the uh, you know the, the prolonged sideways uh, you know, you know range for a while. You know I'm, I'm still hopeful that we are in the, the re acceleration stage like we were in 20, 20, 2021 where we're not in November of 2021 going down to 16 from 69 that we are in the, the where we went 65 to 30. That was our 50 drawdown. That's kind of where we at now from the 126 to 60 range. That's our 50. And then hopefully we get a re acceleration back up to all time highs from here. You know the ISM index, you know that that's the business cycle. That's one of the cycles that I, I really like to look at. We've, we're, we're now have entered past the 50 mark which usually you know indicates an expansion in the economy. We're at over 52. I would hope that if that continues and continue to accelerate through there that the, the market continues to accelerate and, and we don't have a larger drawdown here from here. But that will certainly be one of my, you know, my invalidation points to see what we do if we continue to go farther down below 60 or if we can hopefully regain some momentum and move back up. But I, I, you know, I'll tell you, sentiment where Gary is, is has been communicating has certainly taken on a life of its own. It's not uncommon. There's more people this cycle who are bitcoin, people who are educated, who have been through multiple cycles who are rooting for lower discounted prices on bitcoin which does not make them bears, just makes them opportunists. And so it's a very different sentiment right now. I'm certainly watching it. But I think Gary has some definitely is communicating sentiment that is picking up. But again I hope that we're in the the 2021. It's like we re accelerate and not going down to the 16.
- [44:26]
A
Yeah, I mean that 55% drawdown I think it was like 65 to 28ish depending on which exchange happened so fast. Right. I think what's kind of felt different this time and maybe has sent sentiment so into the dumps is the fact that it's been such a slow and long grind down. Right. So while the number is the same also I would say that that drawdown that summer before the re acceleration to 69 also came right after a monster alt season which we didn't get this time on the way up. So I think that there was a lot more optimism and excitement at that point that things could bounce and come back because people were launching pre sales that were doing thousand Xs overnight still into April and May of 2021 before that drawdown. And I think also Jamie that a lot of people had specific narratives which they just need to explain drawdowns at that time. They could just say whether it was true or not. You know, China banned bitcoin. That's the reason, you know, mining went offline. That's the reason. And this time I just don't think anyone can figure out why it's happening. And I think it just frustrates people when they have no narrative to assign.
- [45:32]
H
The one other thing I would say if you look at the ETH BTC chart there has been a breakout of that downtrend. So you know, you know, if you take a look at that and I could put it in the nest if you like. You know again that that would, you know, eth led last, last cycle and then bitcoin re accelerated beyond it, you know, you know we just don't know, you know. Right. But I'm just looking for some kind of patterns or something that I can see to say this is something similar or dissimilar. And that's one of the things look at.
- [46:04]
A
Yeah, I. I mean, that's one of. One of my favorite narratives is, you know, we've done 55% in most bull markets, so big deal. It just always feels different for some reason when you're in the midst of it. Even though I've had people tell me that this is the most brutal bear market we've had. And first of all, I wasn't even here for, say, Mount Gox and the much earlier ones. I came in late 2016. But anyone who right now believes that this is the worst bear market we've been in, who's even been here for one previous cycle, is just operating on recency bias. Like, this is literally nothing in my mind compared to what we went through with Voyager, Celsius, Blockfi, Luna and ftx. Right. I mean, at that point and spf. Right. And all these guys. So I just, I think people are just losing their minds because they can't explain it.
- [46:54]
H
And Scott, just to that point, like the fear and greed, like, it's extremely low.
- [46:59]
C
Right.
- [46:59]
H
But. But if you just. What you discussed, like there's. There's no crypto or bitcoin event that's. That is related compared to fdx, Celsius, three hours, all that stuff Loop, Victora, Luna, like that was in the, in the market related. Like everything that I'm seeing that would be related to the fear index being this low is more macro, more, you know, political, you know, all that stuff like that. It's not. There's. We've had administration support, we've had regulation. So like, everything is like bullish for our.
- [47:28]
A
I think that's why, though. Yeah, I think that's what I'm saying, though. I think people are more fearful because they don't have something to explain it. Right. It's just that uncertainty and how is it possible maybe it really is over because it's going down without an FTX or some major catalyst. Right. DB Go ahead.
- [47:47]
G
Well, yeah, I think it's also that as well as what you're pointing to, that we didn't get an alt cycle, really, at least nothing compared to what we saw previously. And so many people are holding heavy, heavy alt bags, which makes it seem so much worse for a lot of people, which it's, it's understandable. But if you look back at what happened the last alt cycle, it's. It kind of destroyed things in a way. We had protocols dropping with valuations that put them in the top 200 companies worldwide, which is just absurd. Protocols that didn't even have a working product. They were basically a white paper launching with 10 to 20, $30 billion valuations, which is asinine. And even VCs were underwater on some of these and still are. And this is what did so much damage to the space. And we were due for a reset. That's what's going on right now. That's why there's no altcoin cycle.
- [48:42]
A
Let me add to that. Let me add to that. I think you're 100% correct. I think that that is one of the most compelling narratives. I would just say that if that was the camel, the straw that broke its back was Trump and Melania Quince.
- [48:57]
G
Oh, for sure. Yeah. And I was talking with Dave about this, I think yesterday or the day before, it's. It's unfortunate. It's not just because of what it was, but because of how people view Trump. And now because of this coin, half of the country, half of the U.S. half of the world is anti crypto because of those coins, and that did so much damage.
- [49:21]
A
I think on paper, it was going around making the rounds Yesterday. I think $4.3 billion retail loss on Melania and Trump. So people who bought Held never sold and are down that bad or sold and realized a loss. But as Dave, I think kind of put it, and we've talked about endlessly, it's more about the damage that it did, as you said, sort of to the reputation of the asset class and how people viewed it. Tom, go ahead.
- [49:48]
E
No, I was gonna say that I'm actually, like, with all the fear, all the negativity, I mean, in the past, that's actually been a very good bullish sign for me, you know?
- [49:58]
A
Yeah, bottom sign.
- [49:59]
E
I. I love bottom signals like that. I've been seeing a lot of. A lot of big players come back into the market at these lows. Even if it doesn't hit the bottom here, you know, it's. It's. I don't think it goes much further. And even. Even if it does, you know, that's not a big deal either. Like, I mean, how close are we still to the top of the last. What was. What was the top. What, 72. The top of the last.
- [50:24]
H
69.
- [50:25]
E
69. So 69 was the top of the last bull. So, I mean, we're sitting right in those same Area as we were right at the top of the last bowl, you know what I mean? I've been here since 2018 and you know, I just think overall that this is a lot of bullish things that are coming into the market right now. So I just wanted.
- [50:47]
A
Yeah, I mean last time, last time we topped it, you know, 69 and then went down to kind of sat in the 20s and then dipped down to, you know, 15, 16, 17 post FTX and that was basically aligned with the highs of the previous cycle, around 20. I mean, to be clear, I mean for everyone, I am not bearish and I tend to agree kind of with what Jamie and Tom are saying here. If we have crypto, fear and greed, the longest we've been fearful ever and at the lowest it ever hit, including Those days in 2022, we have Google searches of Bitcoin going to zero at their all time highs. Basically. Those are not signals of a market that's going to drop much further. I'm not saying it can't, but let me just put it this way. I am a heavy buyer higher in this area personally. So like putting money where mouth is, I'm very happy to buy bitcoin here even if it ends up in the 50s or lower because I think we're kind of irrationally getting oversold and the sentiment is, does not align with the value.
- [51:48]
G
So yeah, I think why a lot of people are still probably bearish is because they're altcoin holders and they are looking at altcoins. And I completely agree with you. I still think there is pain coming for the altcoin market. But if we're not near a bottom for bitcoin right now, ouch.
- [52:07]
A
All coins didn't even pump when bitcoin went to 126. Right. So there's definitely a world we were discussing this morning where bitcoin has that kind of climbing the wall of worry Jamie described where it rises slowly back up like 2021, but this time all coins just keep going down.
- [52:22]
E
The difference, the difference in 2021 is that a lot of those coins were new. A lot of those coins had a lot of room to go up. They had a lot of room to go down this time. And I think that's the turnaround in this market is that a lot of them didn't actually do anything. They didn't actually have any use case. They didn't actually, you know, do what they said they were going to do. So all these coins that were way overpriced needed to come back down to where, you know, they're where their legit price should be, you know.
- [52:52]
A
So most of those are zero. Yeah.
- [52:55]
E
Good luck.
- [52:56]
A
Go ahead, Jamie.
- [52:57]
H
Well, I just want, you know like the, the difference with this rise to, to in October for bitcoin and then, you know, the, the 50, you know, downtrend is that, you know, dominance hasn't, hasn't, you know, drawn down. You know, it's been, it's been very steady around 59 now. It's recently broke down a little bit. We'll see if it continues to go, to go break down there. But that like last cycle it went from 60 to 35 and that's when the market shifted their money capital rotated. Ethereum then took off and then once Ethereum took off, then the altcoins took off. So if we don't see a breakdown into the dominance of bitcoin, then that is going to be the indicator to me to where we see a rotation or not.
- [53:46]
A
Agree. All right, gentlemen, we're right up against time and I have an 1115 that I need to make. That was a great conversation. Appreciate you guys joining me once again for everyone. We'll be back on Wednesday, not tomorrow, but Wednesday and trying to keep it fresh and interesting, which I think today most definitely was. Thank you guys for joining. Thank you to everybody on stage. Thank you for everybody listening and we will see you in two days. Have a good one. Bye.
- [54:09]
H
Thanks, Scott. Have a good night.