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Czech Central Bank To Propose $7bn BTC Reserve | Crypto Town Hall
01:03:21
Czech Central Bank To Propose $7bn BTC Reserve | Crypto Town Hall
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- [00:01]
Host
Morning everybody. Happy Wednesday. Welcome to Crypto Town hall, the largest X spaces in crypto every single weekday at 10:15am Eastern Standard Time. Hope all of you are having a wonderful day. We have quite a lot to talk about today and we will dig into all of this obviously. But our main story here, which may not remain the main story for long, is that we have the Czech central bank governor proposing to invest 5% of their 140 billion billion euro reserves in Bitcoin to diversify his assets. Hilariously, his quote was I like profitability. That's what he said. But this is actually being pitched to the central bank tomorrow. So this is not just a bluster or random idea. This is one of the actual central bank governors proposing it. Potentially in bigger news or arguably we can discuss is that it was just announced, I saw it on Watcher Guru that Donald Trump is launching Truth Fi. This is under the DJT umbrella to buy Bitcoin and other digital assets. So basically their corporation will be potentially adding Bitcoin and other digital adjustments assets to the balance sheet. And on top of that we have Utah I believe. I'm looking for the news right now. Utah moving forward with a favorable recommend recommendation from the House committee to make them the second US State to pass legislation through committee for once again Bitcoin on the balance sheet. We saw Arizona yesterday moving forward, potentially adding Bitcoin to the balance sheet. It seems we have a real arms race here to get Bitcoin on the balance sheet by United States states. So a lot going on here. Sorry, I kind of mumbled through that. Reading the news as we go. Here was the official news by the way on Trump. Trump Media and Technology Group is announcing the launch of the financial services and fintech brand TrueFi. 250 million will be invested in SMAs, ETFs, Bitcoin and similar cryptocurrencies or crypto related securities. TrueFi will enter the field of decentralized finance. Simon, let's talk about Czech Republic first. Right? I mean we've obviously talked about the potential for central banks to add Bitcoin. The game theory of them seeing the United States talking about it, wanting to be ahead of the curve if they think it'll get approved. This seems like a slightly at least more significant story than the other rumors that we've had because he's an actual central banker and is governor and is proposing it directly tomorrow.
- [02:50]
Simon
Yeah, I mean Bitcoin is a free market so anyone can participate. But this was the story that I was looking forward to. Least that was Inevitable and going to come where central banks, members of the International Monetary Fund and the bank for International Settlements which is a terrorist network in my book that has co opted currencies all around the world, is now deciding to hold on to its power for its bank and shareholders to create debt based Ponzi schemes by holding Bitcoin on their balance sheet. So I was way more interested in states gaining freedom from the Fed and the possibility of Treasuries adding Bitcoin on their balance sheet. But we've now hit the central bank phase and Bitcoin is for anybody that wants to utilize it and unfortunately a central bank can use it in order to prop up their Ponzi scheme a little bit longer at the expense of their people.
- [03:57]
Host
I mean they really feel. Just kidding. Robbie, what do you think of the potential sort of game theory now of central banks trying to get ahead and add it and states as well? I mean all I could say also we had announcement by the way that Meta Planet saying I think they're going to buy another 21,000 bitcoin this year in Japan. So there are clearly some big buyers in the market that are trying to get ahead of this trend. Go ahead, Robby.
- [04:24]
Robby
I guess this is where I have to believe hopefully in something that hasn't really worked in practice. But I have to hope that trickle down economics works to a certain extent because I think in this case I think it's great. Obviously anybody who's interested in buying bitcoin, I'm all over, right? I'm in the space and this serves my interests. I think these kind of big players coming in and potentially taking a big stake is great of course for everybody, you know, likely on this spaces who owns bitcoin. But I also think it's great to the extent that we can bring new capital or different capital into the space, whether it's, you know, from state actors or otherwise, guys, and hopefully that then filters down to the rest of the ecosystem. Because I think the only sort of caveat to seeing these big potential investors in Bitcoin is that obviously they're not going to be builders, right? They're not going to go out there and build things with smart contracts on Ethereum and all this kind of stuff that helps grow the space. They're just plugging down a bunch of capital and letting it sit there. So to the extent that the rest of us who are building in the space can actually then make use of that capital, I think this is definitely a win.
- [05:42]
Host
Interestingly, this is kind of a pivot Robbie. But we've seen obviously the crypto natives who probably traded all of those utility tokens in past cycles find their way to memes, right? I think we all know that as much as we love to think that the reason that certain things have gone up and down in the past is utility mostly, it's still, you know, speculation and people trying to get into the hot thing and out of, out of something that's about to drop. So we have, for example, 37% increase I saw in active wallets on Ethereum. Ethereum doesn't move. Right. And we know that this kind of bitcoin buying, if it's in ETFs into central banks, as you said, is going to be holders. So that money may not trickle down the same way it has in the past. So it feels like we have a really bullish narrative for bitcoin right now, but that the rest of the market is potentially really trying to find some actual liquidity in action.
- [06:37]
Robby
I think perhaps another way you could look at it is of course these, this kind of attention for bitcoin is also a net positive for crypto in general because it's one of those things that the information economy does trickle down. So when you know, whether it's Trump talking about it or other world leaders or states, et cetera, talking about acquiring a bitcoin reserve, that does validate the asset class in the sort of traditional man on the Street's mind. And I think that's great because the more mainstream people understand crypto to be, then it opens up the doors for us to have more exotic things like, oh look, here's gaming on chain or here's defi. Here's all the other great stuff we can do with this because actually now that I've got you interested in bitcoin, guess what else there is?
- [07:29]
Host
Perfect gateway drug, right? It's just that I think in previous cycles we would have expected that bitcoin makes a new all time high, $108,000 and then consolidates. We would have anticipated that altcoins would be going up, not bleeding out 50, 60, 70% in five to six weeks, some of them down to bear, market lows. Right? Even some of the most hyped and the ones with utility and actual adoption. It just feels like there's still this bitcoin meme barbell and everything else in the middle is looking for a home. Matthew, go ahead.
- [08:04]
Matthew
I do think there's an interesting, there's an interesting point that a lot of liquidity has just been cycled through Say for example, the Trump coin and through a lot of amine coins. And because of this and because a lot of the utility projects haven't actually become profitable and haven't actually broken through, we're seeing sort of, I think, a bit of a flight to safety with bitcoin dominance being so high. And I do think that it's really good that we are actually seeing more world leaders take it on. I mean, small countries, yes, but also us as well. It should be bullish news, but I think at the moment there is not enough people who provide liquidity to crypto getting their money back yet. And hopefully that changes soon.
- [08:46]
Host
Yeah, the doge all time high, I've been saying for like two years, would be the signal that retail would come back because they would all look in their wallets and go, holy crap, I'm actually not underwater on this thing that I bought at 75 cents or whatever it is, and that would get them interested and be a catalyst. But it is interesting that we have all these tailwinds, all this bullish news, all these incredible things, but prices just generally aren't going up. And if you look, I mean, to your point, the Trump token, you know, I think it was a 75 billion market cap at its peak, total market cap did not rise. Right. So what does that tell us? That tells us that all of that 75 billion, that was FDV, so we can call it, you know, whatever it was, you know, 7.5 or 14 or 15 billion actually in actual liquid, that was just coming out of everything else. That was not new money. There was none. Right. And that's not what we want to see. We don't want to see things cycling through and the same money just getting washed. Go ahead, Dwayne.
- [09:44]
Douglas
Yeah, sure. Thanks. Good morning. So, I mean, I think, you know, just speaking about the Czech situation here, I think it really is an underappreciated like catalyst or a tailwind for bitcoin in the sense that this is the first western country that seems to be fully committed to basically adopt this. So the governor, you know, to echo some of your comments here, the governor was calling himself, you know, a pioneer, if you will, someone who's, who's making a four way, you know, into the jungle, so to speak. These were his words of, you know, basically getting into this. So, you know, some of the things that we're watching here, of course, was the inflows for Bitcoin ETFs. So overall in the month, we've seen, you know, we've seen Net inflows positive, I think as of today. I only checked maybe say like an hour and a half ago, but I think it was just IBIT that had positive inflows for today. But on a monthly basis we can see that it has over. We're overall in the green here. So I think institutional adoption is very big. The FOMC meeting is today, which would have most likely pulled back in regards to sentiment as well as the overall prices here because most people believe that the Fed is going to hold fast for some time and we're going to pay attention to their comments. So I think the overall themes that we have here of institutional adoption as well as just overall interest for the average person on the street are going to hold fast and despite the fact that some of the Trump trade, at least for the moment, is priced in in regards to sentiment. So I think overall there isn't anything to really worry about, so to speak, and that we're not going to necessarily see too much of a strong pullback, but we're going to see prices progress over the three to four months here.
- [11:38]
Host
Douglas would love your thoughts there. Obviously, as you're looking at the macro as well.
- [11:44]
Dwayne
Yeah, everyone's kind of on pause today to see what the Fed does and it does look like the federal stay on hold even though everyone wants them to cut. But I think that maybe the most exciting news today that I picked up was Robinhood saying that they're going to go to the SEC so they can offer private equity in tokenized form. You know, so pre IPO stocks and like the SpaceX of the world, the open eyes of the world, because that really shows if you can get what is there 25 million private companies in the United States. If we can start essentially having them not create meme coins but create securities that can then be traded with the liquidity of public stocks, that would be quite something. And I think Robinhood's sort of the biggest name that's leading that charge. But I think that that's very interesting in terms of central banks, in terms of states. I think we all understand and everyone in this call probably knows that yes, it's going to happen and it's going to go through, but the buying might not happen as soon as they sign the documents. And so I think what it does is it gives us support on the downside in Bitcoin and you've got some folks calling for a pullback to 75,000. Okay, great, that'd be super. We can buy more. But the reality is that Bitcoin is just going to continue to climb higher over time. And I think that when we have these calls on a daily, weekly basis, you know, we get anxious about time and because we're essentially putting a microscope on time. But the reality is that we all know and we all understand that over time, you know, in a year's time from now, we'll look back when it's at 250,000 and say, well, of course it was going to go up. You know, we're not looking at every single news headline. But, yes, it seems like most states will end up adopting it. And the states seem to be doing it in a bipartisan way, which I think is very important. I think Senator Lummis is doing everything that she can to make sure that bitcoin is a large part of this crypto reserve that the US Is going to happen. It's exciting to have the Czech central bank say, yep, we're going to move into doing this as well, and you're going to find adoption by all central banks once the US really tells the world what they're doing. But it's very hard now to be a central banker anywhere in the world when you understand that the US Treasury Secretary and the US President are both now fully bullish on crypto and specifically bitcoin. And I think that that's going to be echoing throughout every central bank and they will start to pick it up and you'll see more and more folks now it's much easier for the younger central banks like the Czech central bank to come in and say, you know, we're going to adopt this, but you've already seen it obviously in El Salvador, but we're going to see it everywhere, and we just have to be patient.
- [14:20]
Host
I agree with all of that. I think, Douglas, I think the struggle. Listen, this is crypto town hall. Obviously, I'm a bitco first believer. I believe there's bitcoin and everything else, and they're completely separate asset classes, but it's crypto Town hall. And the reason I think we're seeing the depths of despair all over the place is because everyone agrees with what you just said, but has very little conviction at this point or a lot of questions about what happens to the rest of the market. I think that that's just kind of the issue that we're having here is that people are not just holding bitcoin and probably are fearful that those other things won't rise. I mean, Robbie, I'll ask you. I know I'm a tell you had your Hand up. But Robbie, I'm just going to ask you quickly. You guys, obviously we talk about this all the time, are investing across the ecosystem. You obviously don't have any doubt that we're going to see major altcoin movement. I mean listen, we just XRP and Cardano and all these dinosaurs at one point, just a month ago moved like 7x so we know they can move but it seems like you have to be more discerning and selective this time.
- [15:22]
Robby
Yeah, and I think, you know, as has already been said on the call, I do think that we're seeing a, I don't know, I like to call it a flight to quality personally. But I was going to say a return to utility because I think that people are starting to recognize that, you know, there is value in utility and in a world where there isn't so much capricious, you know, regulatory enforcement, utility can have a value without the fear of, you know, arbitrary, you know, roadblocks coming in its way. And so for that reason I think definitely we're going to see more. We're going to see it across gaming and defi and you know, rwas depin and a ton of AI stuff and there's going to be a meme aspect to all of this because I think, you know, mimetics are great for user acquisition, they're great for building communities, they're great for viral marketing. And so similar to, you know, on a previous crypto town hall, I think we talked a lot about Telegram. You know, just like I think everybody should have a telegram app to build the top of their user acquisition funnel. I think everybody should think about what their meme strategy is because it's another way to reach out to online communities. But I do think that the focus will be on utility.
- [16:38]
Host
Right. You could say their meme strategy, which is really code at this point for community strategy. Right. Because that if, if this was three years ago, you'd say we need an NFT strategy, right? I mean, is that accurate?
- [16:49]
Robby
Yeah, yeah, I think so. Except the, the difference is I do think that there is some intrinsic value to NFTs only because you do, you know, you do get the digital property rights, which is the first, the first thing. And, and I think that, that we're going to see a lot more products coming out this year that will focus on that idea that we can have digital ownership of ip, whether that's, you know, us owning a collectible or it's actually using on chain mechanisms to enforce royalties for the dissemination of copyrighted materials. I Think all of that is going to blossom this year.
- [17:25]
Host
Right. And I think interestingly, those are narratives that bubbled last cycle. Right. And we always see this sort of like hype cycle that happens and then sort of come back down to earth and then in the next cycle we see the things really start to happen.
- [17:43]
Robby
Yeah, well, and it's not dissimilar to kind of the web 1.0 days where we were all excited about what you could potentially buy in e commerce and then not all the ducks were lined up. We didn't have cheap drop shipping and we didn't have lots of good online payment methods. So e commerce didn't really work in the late 90s. But by 2005 it started to become something that was a reasonable proposition. And then five years later people are wondering why it never happened earlier.
- [18:14]
Host
Yeah, I mean ride sharing was proposed in the early 2000s and failed because people didn't have iPhones, wasn't ready. But it was a great idea. Uber was just at the right moment for the right idea. Amateo, go ahead.
- [18:29]
Amateo
Yeah, great thoughts all around. So if you look at Poly Market, it's got a 98% chance that the Fed doesn't cut rates today and they hold tight. So we've definitely been in this bull market in a liquidity constrained environment that I think is a big reason that it's affected kind of the perceived risk. But we're still seeing liquidity move in. Right. The supply of USDC and USDT just hit an all time high. We also have obviously the bitcoin move to the upside. So we're still seeing liquidity come in from a multiple amount of venues and I think we're just seeing the kind of holding pattern on when do we actually have a risk on environment. I think when it comes to like the central bank and the states starting their reserves, it's very clearly a classic no one wants to be first, no one wants to be last situation. But I think the reality is people now realize that there's an inevitability coming and whether you have some questions onto the ethical legitimacy, the control mechanism that Simon outlined in terms of the actual act of these countries and central banks starting to acquire bitcoin reserves, the seal has been broken and now people are trying to move in because they don't want to be last. And I think that that trend starting to pick up speed is only going to accelerate and I expect a lot of headlines on that. I mean, look, I think there's a reason why this flush hit mean coins. The Hardest, it's to be expected. Memes were a tradable market when we had these weird asymmetric Bitcoin and Bitcoin dominance conditions where you still had potential gains, you still had tradable markets that, that didn't necessarily always adhere to the Bitcoin dominance that was affecting the majority of other alts. But now that is changing. Liquidity is becoming well positioned and I agree with Robby here that as these meme coins flush out, as this liquidity comes in, we are going to see a return to utility and assets, finding valuations beyond speculation and a flight to quality. I think what we're looking here right now is the, the ability to say, okay, when do we have more risk to enter these things and for valuations to start to settle and liquidity start to flow down.
- [21:07]
Host
I just saw an announcement looking into it now that the bank of Canada has announced an end to quantitative tightening. Tightening just for the liquidity maxis out there. However much that's going to help it, it should be interesting to see how that plays out, especially as we kind of have the Fed making their decision. I mean, consensus obviously that the Fed is going to do nothing. Does anybody have a feeling on what that will mean for markets when you do have it priced at 98%, that the Fed's going to do nothing? Are we now back to waiting to see which way Powell sneezes during his speech to decide if he's dovish or hawkish? Matthew, you're laughing, but I mean, that's really where we're at, right? I mean, that's going to be about tone.
- [21:49]
Matthew
Kremlin ology. It's like Kremlin ology where you're, you sort of, you just don't know. I mean, I personally think that the, the amount of change that's happened in the US has, has caught everyone by surprise. Like Europe, as always, is lagging behind in, in what's, what's to come. And I do think that people are actually underestimating the size of the pie could grow. So I would be. I mean, everyone's going to say he's going to do nothing. But I mean, a little cut here could, could make, could make a huge difference to our industry.
- [22:22]
Host
Anyone else any particular thoughts on that? Panos, I saw you were kind of reacting there with the laughs as well. But we all know that, you know, the way Pal says things, almost more important than the actual news. Yeah, it's kind of funny how that works. Yeah. I mean, typically, what happens in these things when nothing happens is you just see a spike up, spike down, liquidation, wicks and then continue sideways until the next news event happens or yeah, whatever, whatever's next on the on the menu for fundamentals that will move the market. So I just think that's what's probably going to happen today. You'll just see some wicks up and down and then continue sideways. Who made the Robin Hood point? Was that Douglas? Was that you?
- [23:13]
Dwayne
Yep. Yes.
- [23:14]
Host
Yeah, I saw today Forbes released a ranking of the most trustworthy crypto exchanges in 2025. CME Group was first, Coinbase, Bit Stamp, Binance and Robinhood. It's interesting to see first of all how far we've come and the fact that Binance and Coinbase, who are still actively being sued by the SEC for basically listing unregistered securities finance, who was in a lot of trouble but clearly has cleaned up being on that list. But I think that Robinhood is going to be a. And this wasn't the topic I intended, but Robinhood is going to be a massive leader in the next cycle. I can tell you anecdotally because like one of my closest friends, his name is Rob Baldwin, owned an RIA called Trade PMR and they just in big news, about a month ago it was announced that they sold he sold his company to Robinhood for $300 billion. $300 million. Excuse me, 300 billion would be a lot more exciting as his friend. But he sold to Robinhood for $300 million. Effectively he'll become the second guy and shareholder at Robinhood running the institutional side. But what we have here is Robinhood is wholesale obviously into crypto, as you said, tokenization, all these things and now hiring and buying more aum. So that's 40 billion more now they'll have as custodians. But really what they're doing is buying a custodian, buying an RIA, hiring one of the most talented RIAs in the world and converting those 25 million retail customers they have into real long term adult investors who are actively or passively managed. And crypto is going to be a huge part of that. I mean it's hard to understate just because I'm happened to be close to it and have seen some of the conversations how big this will be for Robinhood as a company, but for crypto because it's so fundamentally integrated into what they do. Go ahead, Matthew.
- [25:14]
Matthew
I was just going to say Robinhood is literally the most normie stock device possible. You can just go onto the Reddit subreddits Like Wall street bets and one of the most popular subreddits. All the GME stuff was all around Robinhood. Robinhood is probably the easiest way we get liquidity into the crypto market. It's full of savvy investors, Gen Z investors, and when they see those sort of comparative returns on crypto and potentially some of the bigger crypto plays there versus what they used to stocks and options, which somewhat a lot of risk and downside, I think it's going to definitely accelerate adoption in terms of putting liquidity into our space.
- [25:59]
Host
Right. And so imagine assuming they're successful when Robinhood makes a full institutional push, as will be arguably one of the largest custodians in the space, wooing institutions over and pushing their retail clients into more serious products like the ETFs and these tokenized crypto assets. That's what they want to do. Whether they'll be successful, I can't say or not. But they have now a huge lead with basically this acquisition. Amateo.
- [26:29]
Amateo
Yeah. One thing that we haven't talked about today is Kucoin pleading guilty to US criminal charges that happened yesterday. They agreed to pay over 297 million in fines and forfeitures and also agreed to not to cease US operations for at least two years. Imagine there's all sorts of VPN workarounds.
- [26:50]
Host
Not financial us. I was just gonna say, did they have US operations? What's the two year thing like? I didn't think they were available to us. Am I wrong?
- [26:59]
Amateo
I mean there. I think obviously those workarounds were very telling and very easy to identify because they were servicing US operations, otherwise there wouldn't have been jurisdiction and the ability to actually go after these guys for the purpose. There was nothing that I saw and I could have missed it, but around like anyone. Yeah, there's some deferred prosecution agreements in the mix and stepping down in management roles. But what does that actually mean? Is anyone getting arrested, etc. I think that remains to be seen, but I think that we are seeing kind of like what is the on ramp, off ramp, musical chairs situation that we have here, both in institutions and within retail. So like we're talking about Robinhood, that's obviously going to be increasing as an on ramp into crypto through retail and to institutions. But we're. I think we'll see more of this. But I think what's the bigger story here is that a lot of these concerns, the SEC concerns, we're starting to put this stuff to bed. And that is the kind of Headwinds and clear skies that we need for people to have more confidence in the market.
- [28:10]
Host
I mean, when you talk about Kucoin, I didn't dig so deeply into it. I remember obviously when the charges were kind of brought, it's kind of like Binance flight, right? I mean it's the same idea allowing Americans to access the site, unregistered securities, potentially some questionable market making and liquidity. But once I think Binance was resolved, you could tell what was going to happen with most sort of offshore exchanges, which is come kiss the ring, pay the fine and get compliant, right?
- [28:41]
Amateo
Yeah, exactly. And I think the other piece of that is Coinbase announcing that they're going to be changing their entire listing framework because of the sheer velocity of tokens that are coming on board and that whatever they offer to consumers doesn't need to be made visible, whether it's happening on a Dex or a sex. So I think when you look at that clearly there, everyone's fed up and they just want to open the markets. They're tired of restricting things, they're tired of jumping through hoops. And I think that they're willing to take on the challenge and the risk. With the anticipation of whatever regulations come, they'll adhere to it when the time comes. But the fear of actual penalties is also being put to rest.
- [29:24]
Host
I mean this exchange makes so much money. If they're, if they're really downside is 20, 25 to pay a couple hundred million dollar fine. I don't think they're even scared of that. And I think that a lot of them are going to be wholesale making moves into the United States to compete as well. But hard to tell what's coming sort of in that arena. I'm trying to look through the rest of the news. I do want to talk about sort of this, this Trump story. Trump's media new financial arm TruthFi to invest in crypto and other assets. As I said, they plan to invest up to 250 million which will be managed by Charles Schwab, interestingly, and customize ETFs, crypto and other investment vehicles. So that's actually interesting. We have to dig into this. But if Schwab is managing it, how will they be investing in crypto? I'm assuming that means Bitcoin and ETH ETFs or through companies that invest in Bitcoin convertible notes, maybe from MicroStrategy. I mean, what can they really do if this is being managed by Charles Schwab? Does anyone have any thoughts on that? Of Course this is conjecture, but this isn't like World Liberty Financial that's just buying Ethereum $10 million at a time on chain. Right? I mean, anybody have any thoughts? I mean, Simon, what do you think? How can they even approach this market through Charles Schwab?
- [30:43]
Simon
Sorry, I was a little distracted. Do you mind rereading the story?
- [30:46]
Host
Yeah, sorry. I was just saying that Trump Media Group is basically going to invest 250 million into crypto and other assets. But it says it will be managed by Charles Schwab and customized ETFs, crypto and other investment vehicles to my knowledge. And maybe I'm wrong, but there's not many creative ways to invest in crypto beyond the ETFs through Charles Schwab.
- [31:08]
Simon
Okay, yeah, that is bizarre. So let's think through that. So Trump Media is a public company, djt.
- [31:15]
Host
Right.
- [31:16]
Simon
The actual public company, not the.
- [31:17]
Host
Correct. This is this company that's launching an kind of an arm called Truth Fi, which will be the investment arm focused on crypto and other investments.
- [31:27]
Douglas
Yeah.
- [31:28]
Simon
So maybe it's a play with MicroStrategy. I don't know why you would need Charles Schwab in order to manage that. You know, more likely you'd be using a crypto native type of regulated financial institution. But that is interesting. Maybe there's something we've missed around custody. Maybe as you said, it's just ETFs and corporate debt. But yeah, I think. Watch that story. But I do think it's fairly interesting that we've now got another public company. So let's look at the Trump empire. So far we've got Bitcoin strategic reserves. I'm sure he owns a shit ton of bitcoin. He's got NFT collections, he's launching a stablecoin, he's got a meme coin for himself and his wife and his pastor and many others. He's got a defi platform built upon Ethereum and he's got a governance token that has sold half a billion dollars, including the largest investor being Justin Sun. Very, very interesting. I think this is an indication of what being the capital of crypto for America is. And I think he's lining up to become very wealthy out of the whole thing. And I think, I guess that's just.
- [32:52]
Host
The way it is. I mean, on a very positive note, he's obviously putting his money where his mouth is. Right? Like whether Tim or his investment advisors or whoever he's with, he's not only doing this through executive order for the country, he's doing it with all of his own properties.
- [33:06]
Simon
So yeah, I do believe in the concept.
- [33:09]
Host
Yeah, I would say we could argue about what he should be buying, you know, and which assets. And of course there's nuance. Most people would say should just be bitcoin on the balance sheet, but he's definitely following through, at least his team is. Paul, go ahead. So I think people forget there's actually quite a lot of stocks that can give people a huge amount of exposure into crypto. Obviously Coinbase backed Marathon Digital, A lot of the mining stocks are easily exposure to crypto, kind of indirectly and as well even before the ETFs, you did.
- [33:38]
Dwayne
Mention the ETFs, but even before the.
- [33:40]
Host
ETFs we did have grayscale and they allow exposure into things like not just Bitcoin and Ethereum, but also not anyone want this but Ethereum, Classic, Litecoin, Solana, I think even zcash. So those are different opportunities that I think don't really cross people's mind. But if you're restricted into what a traditional brokerage would be able to offer, those are definitely options. It'll be interesting to see if they kind of go beyond Schwab, you know, and find more interesting ways to get exposure to the market. But it seems like they're doing that through World Liberty Financial already. So maybe this is just a separate approach. But either way, as Simon said, the real story here is another publicly traded company in the United States putting bitcoin and crypto on the balance sheet. And I think we can all expect a major acceleration in that arena this year. Those are going to be the stories, right? The central bank stories like Prague, the corporate adding it to the balance sheet. And of course, has anybody dug deeply into MicroStrategy's new security offering, STRK, which is I think generally preferred stock. Anyone here taking a look at that? Because it's yet another way for Michael Saylor and MicroStrategy to raise capital to buy, raise capital to buy Bitcoin. You know Paul, Douglas, either of you looked into this? Oh no, you guys. Douglas.
- [35:06]
Dwayne
Yeah, well, I've looked, I mean I, I've looked at it in a cursory way. I mean it seems to me these are largely out of the money calls that you can buy that pay you a nice yield of 8%. And so it's non dilutive in a way, but allows him to raise capital again through a vehicle that some companies that can't invest in equity or can't invest necessarily in Bitcoin can invest through this. I think that what he's doing, he's an absolute genius of financial engineering and he surrounded himself with folks that say, look, here's where the pockets of capital are. Here are the rules with which you can invest in things. Some guys are looking for lower volatility. This is going to be obviously lower volatility than the common equity. And so based upon different rules that people have for capital allocation, he's finding products to fit that and products to fit that in a way that he can buy Bitcoin at a much cheaper rate that's accretive towards the common stock investors.
- [36:06]
Host
Yeah, I mean that's really the story is he sort of microstrategy was a proxy for an ETF before there were ETFs. When the ETFs were approved, he started doing convertible notes, which are like debt instruments he could sell to insurance companies and such who could buy a micro strategy stock or Bitcoin. Now he's just finding more and more novel ways to open the doors to everyone to get exposure. Right. I mean, Simon, obviously we'd rather everyone just buy Bitcoin. Right. But to that end it's still, I would say, a net positive to have people gaining exposure through these novel sort of products. Right.
- [36:41]
Dwayne
Well, not everyone, not everyone can buy Bitcoin. You know, if you're a pension fund manager, you can't necessarily buy Bitcoin today. And maybe you can't buy MicroStrategy because the volatility is too high, but maybe you can buy this new preferred stock because it's got a much lower volatility. So in that way you've got indirect access to Bitcoin and price movements and it's all allowable based upon the rules you have as an investor.
- [37:08]
Simon
Yeah. As I've always said, Bitcoin does three things. Things it allows you to earn your money without a bank, it allows you to spend it without having to get permission first. And it allows you to historically be inflation and every other asset class. And so if there is only people pensioners gaining one utility from that, which is the third one, then it's better than nothing. What is, I think interesting is that there has been an application for in kind redemptions to some of these Bitcoin ETFs, which is actually an incredibly interesting concept that you could come. I mean even just imagine you're doing it through your pension fund, you buy an ETF and then you're able to get an in kind redemption. How does that look? You know? Then are you needing you Know, almost like a multi sig wallet with some of the more crypto friendly and bitcoin friendly retirement plans that have been set up with self invested pensions and various other things. So all sorts of interesting questions, but yeah, at the end, I think the true power in bitcoin is that you earn your own money and you harness all of the power of it. But if this is your gateway drug, then welcome to the party.
- [38:37]
Host
By the way, you show as a listener for me and I was just told by the team that you're a speaker, so welcome to the glitch. Can you actually hear me? You're a listener for me. So I, I kept, I invited you like 50 times to come on stage and I was wondering.
- [38:52]
Douglas
Yeah, but I tried to log in 50 times. Honestly, it's like I.
- [38:55]
Host
Do you show us a speaker or listener?
- [38:59]
Douglas
For me, I was trying to unmute and then I left and I came back and I don't know, it was.
- [39:03]
Host
You're a listener for me.
- [39:04]
Douglas
For me I didn't hear some, but. But if you hear me fine.
- [39:08]
Host
Yeah, I hear you fine. It's great. Jimmy, thoughts here. I know we're going to move on in a minute, but specific thoughts?
- [39:14]
Douglas
Yeah, I think honestly I'm very happy. I wanted to reflect on the first half but then when I managed to get back in, I was, I didn't want to interrupt the floor, but I was actually wanting to say that I'm very happy to see these things happening with the central banks and the Czech Republic and whatever, adding or even having a serious conversation about, you know, adding bitcoin as some sort of reserves. And what I think we really are going to see, and this is why things can get really silly really fast, because supply shock is going to happen. So what you're going to see is that more and more companies, more and more governments and central banks and companies going to realize that there's 21 million bitcoins out there. Two of those are already lost and whatever, about 2,4% is held by only the US ETFs. I think it's going to be very clear very fast that it's the first come, first served and that can really send the price higher of all of our expectations in the coming years.
- [40:07]
Host
Ran, are you joining us live from Satoshi Roundtable?
- [40:10]
Douglas
I'm joining you live from Dubai, sir. Live, live and in the flesh.
- [40:14]
Host
I'm having a little fomo. Is it today the first day? How is it?
- [40:18]
Douglas
No, it's not. It's a day before, so I haven't actually seen anyone. I've been actually working most time in my room. Yeah, it's. Yeah, I'm still, still getting up there. I don't think too much fomo. So.
- [40:31]
Host
Okay. Okay. We haven't been listening, but anything you're dying to. To share with us before I know we move on to a sponsor, you guys have no.
- [40:39]
Douglas
I mean, I guess, I guess big FOMC today. First time with Powell versus Trump. I guess we're going to see a little bit of posturing by Pal, but just maybe digging in his heels to just remind everybody that he's independent. I don't know. I think that that's. That's pretty much what we can expect today. What do you think?
- [41:00]
Host
I think it'll be a big nothing burger. We were talking about before that like at some point he'll say something with some tone and the markets will, you know, go up and down with wicks in both directions and everybody will real. Everybody will realize it's kind of nothing and move on with their lives to the next story. But you remember when these FOMCs, it was like, do you remember these FOMCs RAM when we used to do shows and it was like 30, 000 people showed up hanging on every word.
- [41:26]
Douglas
Yes, I remember that.
- [41:29]
Host
Nobody cares.
- [41:31]
Douglas
I missed the bull market, sir. And I mean you can say this is a bull market, but it's not actually, actually scratch. I. It's not the bull market. I actually, I did a show today and I spoke about why people are getting shaken out and actually I looked at some data points. Retail is completely, completely out of this place. The only people driving this market are Sailor and the, and the, and the ETFs. And that's not retail related and that's only bitcoin related. Actually.
- [41:57]
Andre
There's only.
- [41:57]
Douglas
But there's actually only bitcoin inflows at the moment. And it's just not enough to. To prop up this altcoin market. And actually if you look at Solana relative to bitcoin, it's the same price relative to Bitcoin as it was exactly two years ago, believe it or not. So like even Soul, which has been that one of the best performers in the market on a major level, that is now it's exactly the same price relative to bitcoin as it was two years ago.
- [42:23]
Host
Yeah, we were talking about that before. It's this barbell, you know, like the same DJs who have been here for 10 years are trading memes and the institutions are buying bitcoin and there's almost nothing in between.
- [42:36]
Douglas
Yeah, there's nothing in between. That's very, very, very frustrating. It's so frustrating because the problem is tokens are launching.
- [42:45]
Host
Yeah. I mean you got bitcoin hit an all time high, over 100,000, holding above 100,000 in the past cycle. This would have been an absolute altcoin fiesta during a period like this.
- [42:58]
Matthew
I mean one thing I would say is that we have like, like 500 million altcoins now. We have so many altcoins, it's kind of inflation for our industry in a way. I mean if you count meme coins, if you count the millions of coins that are launching every day, the liquidity is getting thinner and thinner spread. I mean when everyone was locked into meme coins on Ethereum, you had gas fees, you had actual technical knowledge to stop people launching chains. Now we have a proliferation of chains, we have a proliferation of supposed utilities. The NFTs, there are now a billion NFTs, there's now 500 million chains. There's so many things now, now that we're actually probably in the biggest bull market, but there's no liquidity. Individually there was a smaller participation but all of those people became richer from being in it. And I think it's definitely the case that we have more participants but there's way more ways to actually spend your money and spread that liquidity. And I think the bear market was absolutely worse than a lot of people imagine. Recovery from that was harder than some people expected and they didn't actually have the liquidity to make that money back. I think that's actually been part of it that people who would have participated couldn't actually get back in. So we've seen prices rising and the liquidity still has not been there. I think that's just my personal take on it, not financial advice of course.
- [44:27]
Douglas
I think it all comes back to attention though if you really look at it. Yes, there are 500 million, 2 million or whatever coins out there. But if you look at that liquidity owned those Bitcoin is basically nothing. So that's why I believe, you know, there was a very good saying that 2025 will be traders paradise and investors house because it's all a rotation market. We've got bitcoin, we've got Solana because we've got AI agents in Solana, we've got memes on Solana and that's been the major player. We are hoping for an ETH rally but in general it's been rotations. So I think it's rather coming down to attention. I don't necessarily think that it's, it's a liquidity dilution because it's, it's a dilution for a little time. Look, AI agents has been here, you know what the past three months, 30 days ago, they were like the biggest thing ever. Everybody was talking about them. Now Most of the AI agents done 80%. Will they come back? Absolutely. But it's going to be a rotation market. And yeah, I think it's rather the question who can get the most attention. What catalyst can we find in these that will eventually cause rolly?
- [45:21]
Host
I think one thing, but one thing I really have my eye on which I think could catalyze at least Bitcoin and tokens on bitcoin are the suite of L2s that really hasn't hit the market to the degree that I think people are expecting. But as mentioned by I think Matt, in the early days of the meme coins and the altcoins on Ethereum, it at least created gas fees for Ethereum. Bitcoin. Its story in the L2S has primarily been lightning which has by and large not functioned. And when we got a huge influx of tokens on. Not tokens, but NFTs on Bitcoin, it was short lived because they were so expensive. But being able to put those on an L2 as well as put DeFi on a full EVM compatible L2 fundamentally I think will catalyze the next wave and it will do so specifically on bitcoin. Whether or not that trickles down into other chains and other altcoins is yet to be seen. But I feel like this is easily one of the next big catalysts that could change the market. Yeah, I agree with that. I know that you wanted to have a chat with Andre.
- [46:24]
Douglas
Yeah, yeah, we've been, we've been. Andre, I see you. Are you, are you hearing us? Because just we'll make sure that you're also here and can you hear us, Andre? I see.
- [46:35]
Andre
Yes, yes, yes, yes, I can hear you guys.
- [46:37]
Host
Yeah, good job. It's a miracle when we can get to actually work for everybody. Good job.
- [46:44]
Douglas
Yeah, next time I'm not even gonna. I'm not even gonna. I'm just gonna unmute and ask for the first second you guys hear me. Cool. Andre, welcome, welcome, welcome out here. I hear been having a discussion and wanted to talk about these Falcon Finance that you guys are building out a. And on October 10, 2024. Yeah. Last year started talking about this yield bearing synthetic dollar. Can you tell Me tell, tell us more about it, what it is, how does it work? Why is it interesting?
- [47:11]
Andre
Yeah, the first of all, hey, yeah. Thanks for inviting me today. The Falcon Finance we started building this last summer in 2024 before and we built another company and another team for this. And this is synthetic dollar. Why synthetic? Because it represents a dollar value which comes from spot and hedgehog strategies which generates staking and finding rate farming yield which is going to to the liquidity providers. And also we apply some other form of strategies such as delta neutral arbitrage and other delta neutral strategies in order to generate yield for those who stake their assets in order to mint our synthetic dollar. That's how to track. Yeah.
- [48:09]
Douglas
So what is. What is. So you. We have usdc, we have usdt, we have Athena stable. What makes you guys different?
- [48:20]
Andre
I would say that the closer competitors and similar projects it would be Athena. Not usually not usdt. Because USDC and USDT they are backed by fiat currencies. Athena is also synthetic dollar. Right. Our differentiation is that we accept the virus assets as collateral. Not only stables BTC and ETH but also very liquid altcoins and almost all the coins that have binance perpetuals which allows us to cover like larger part of the market. And also we are planning to apply some toized real world assets and fiat currencies in the future. For example like regional fiat currencies like dirham or peso or whatever is not dollar. Yeah.
- [49:18]
Douglas
So for me what is interesting and especially when it comes to stablecoins, especially now you see with regulations, Mika coming in usdt, you know, having majority of the market share and then obviously THENA and USDC coming up as underdogs. How do you position yourself? So what's again the competitive advantage? How do you position yourself in the market?
- [49:41]
Andre
We focus for now the crypto native holders and we don't have any plans for now to be distributed among nuclear. We are focusing like on global market and we will follow friendly jurisdictions such as UAE and others in order to be like licensed with these jurisdictions. Now we start with like proper audit firms and with a proper legal setup that allows us to serve clients.
- [50:24]
Host
From.
- [50:24]
Andre
Like most of the world countries.
- [50:27]
Host
Yeah.
- [50:27]
Douglas
So there will be two tabs. What does it mean that there will be two versions of the stablecoin?
- [50:35]
Andre
The first version it is stable itself which is stable which is one by one, one to one to USD. And the second version is a staked version of the stable which represents generated yield. And this version is. Is representing the yield that are generated that is generated by the Falcon Finance and can be distributed to the staked version holders. For example, you stake 1000 USDF F alcon dollar and then you receive for example 1000 stake falcon dollar. And then let's say in a few months, because of the Yield, your Stake Falcon dollar will cost more than $1. It would be something like a 1.2 for example and then you would be able to redeem 1.$2 for each staked or something like this. It's like the defy version of the original synthetic dollar. Yeah.
- [51:49]
Douglas
So a lot of times the question comes back to, you know, when you want to use a stable coin, obviously you want to make sure that you use something that is stable and it is trustworthy and whatnot. And you guys obviously DWF, you invested in 700 projects, one of the largest, you know, liquidity providers, market makers in the space. What do you, how do you see the go to market for Falcon Finance? Like how will you get people using this table?
- [52:14]
Andre
I think you know that there are like three important parts of it that I believe, right? There's people confidence that it is really over collateralized or collateralized and liquid. Then it's transparency. And the other one is yield. Right. How much money people can make from this? Right. And here we solve these parts like this, this we use third party custody to make sure that all the assets are available at any point of time and have no counterparty risk. Then we also use on chain wallets and third party auditors that will issue audits on a monthly or quarterly basis basis to ensure that collateral is enough and covers all the issued dollars. And also we have, we will have and we are ready and have insurance fund. Insurance fund will be used for instant liquidity to redeem like medium and small amounts of synthetic doors like instantly and to be liquidity for liquidity pulls on the farmer market. Regarding go to market, we see that we go with internal testing which is ongoing now with our team members. And then I think in one week or so we will open it for our partners who are working with DWF labs and they will contribute tvl. We will have a kind of hard cap. We have a hard cap of 100 million USD value of TVO for this period of time and once we are ready to roll it out to everyone on the market, we will do it. Approximately this product will be available available for everyone on 1st of March and USDF will exist on defy markets in February.
- [54:24]
Douglas
Where does the yield come from?
- [54:26]
Host
So how do you, how do you.
- [54:27]
Andre
Generate the yield Ah yeah, as I said, right. Three sources of yield. This first one is staking APY and thanks to wide range of assets that we accept as collateral. We can stake not only blue chips but also top assets. But they generate more than a few percent. Yields can be like 10% or more. For example top altcoins from top 30 to 50 coin market cap without the names. Then third second source is funding rates farming. It's when we have spot position, right. And we short your position and we collect funding rates fees. And third one is data neutral arbitrage. When we do arbitrage between centralized and decentralized exchanges and centralized exchanges thanks to like large amount of assets in the treasury.
- [55:34]
Host
Right.
- [55:35]
Andre
And this is the third source of the yield and of course everything we be audited.
- [55:46]
Douglas
How do you see? Again I'm going back to the adoption, right? So I think it all comes back to adoption. And people support brands, people support trustworthy partners. And of course you guys at DWF Bento partners as well a long time. How do you see you integrating and have an advantage over here because of the projects you're involved in, because of, because of your involvement in the space. How will that help you? How will you leverage that to obviously gain adoption for the project?
- [56:18]
Andre
Definitely we will cooperate with 12th Labs portfolio in order to get access and partnerships with reputable and good projects that believe in us and that trust us and that want to have their asset as a collateral for the step of going minting. Because for projects it's also good when their token holders put their spot positions not on second markets to sell and impact the price, right. But into, let's say filecoin finance, right. And then these assets are locked there and the token holders have of synthetic dollar that you can trade but the project token prices are not being affected. Affected, right. Which is also good. And we pay also a lot of attention on defined markets, especially Curve, Uniswap, Airdrop. And we are also in talks with a few markets on Solana and we will contribute liquidity there. Because adoption on DEFI is very important because most of people who use this defi yield bearing strategies, they usually combine as few strategies in one portfolio in order to maximize their yields. For example, they have USDC and then they put this USDC or USDT in some lending protocols, borrow some altcoins and then put these altcoins in some staking pools, borrow another stable coins, right? And then they have a kind of scheme that generates some passive income to them. Right. And we would like to be a part of this scheme, this is for crypto market, right? For very short term plans. Right. For the long term plans. Why I mentioned this rwa, right. And traditional finance. Because we are targeting. We're already working with a few energy producers who produces electricity, power and we started tokenizing it and this tokenized electricity fields and plants. And also for example, commodities or gold or securities can be used as collateral to mint these stable coins. Right. That could be a bridge for people who has, who have reward assets to the crypto space. Right. Without losing their underlying assets. They don't need to sell, let's say securities. They can lock the securities and the yield will go to us, to the protocol and then mint stables. That's kind of our plan, you know, to cover both worlds crypto.
- [59:01]
Douglas
And it's always interesting to see when something like this launches. And obviously it's the underdog, right? Coming for the big pie. How do you see the next steps before we round up? So what's next? If anybody wants to get involved with calls. But what's next in the next two to two months, four months, six months, one year? What is the roadmap?
- [59:23]
Andre
Yeah, to roll the protocol out to the whole market. And our plan is to capture at least 5 to 7 billion TVL this year and to be in top 30 coin market cap in terms of market capitalization of our stablecoin. This is our plan.
- [59:51]
Douglas
We can talk a lot more. I have one more question because I'm just interested about it. What other why ETH and what other chains are in pipeline?
- [60:00]
Andre
We are starting with EVE because it is frankly it is the simplest way to start and the most liquid venues are on steer on Eve because Solana is a bit for another type of markets, purely trading. But your bearing strategy is mostly on if and then we're in talks with less, you know.
- [60:25]
Douglas
Sorry, I have to. Because I. I wanted to round up but I have to know this. So. So we always talk about Ether, Solana and all that and you see that souls for another type trading and you say it's the easiest to start with eth. And that's not the perception that we all get, right? Because we all get okay, ETH is clunky, it's expensive, it's slow, it's like. And then we all got the expression that Solana is easy going, easy to get in, easy to get on board, fast, cheap. Can you elaborate a little bit?
- [60:50]
Andre
Yes, definitely. Look, I completely agree that from user experience Solana is the best, right? If we compare it with ETH because it's fast and it's cheap right. But it's mostly retail focus chain. Right. There are a lot of retail activity and it's mostly like digital trading and some form of gambling. Right. Like and having fun like pump fun. If I'm talking about E it's mostly like large holders and large like large liquidity. And if you for example check what would be your slippage if you would like to to trade let's say 1 or 5 million USD value of assets, let's say from use from if to USDT or from Solana to usdc you would see that if would be cheaper for this amounts because of liquidity.
- [61:47]
Douglas
Do you think it is going to catch a bid?
- [61:50]
Andre
I think is is kind of you know is chain for like large holders now because large liquidity sits on it. Large retail liquidity sits on Solana. Because if I am big I'm fine to pay large gas fees but I am sure that everything works and I have a lot of options to generate some yield or to stake or lock my coins, right. If I am small I don't care how much I can yield from some staking because I don't have a lot of funds for this. Right. But I mostly care if I can do digital trading. And here Solana appeal. Yeah.
- [62:32]
Douglas
Andre, I appreciate you. Anybody wants to find you. I see that you have it all in your profile so they can just click on there. Thank you so much for, for, for. Do you have any final thoughts to this?
- [62:46]
Andre
I don't know.
- [62:46]
Douglas
To the moon.
- [62:48]
Andre
To the moon. Yeah. The it's market is really good. Market is really good and I think we have like a very good entry point especially for major assets.
- [62:58]
Douglas
Yeah, I agree. Thank you so much Andrew and thank you so much everybody who's listening. Follow everybody up on stage. Come back. We're live here every single day bringing you the best alpha and yeah thank you so much for everyone participating and listening. Andre, thank you so much and we'll see you in the next one them.
- [63:16]
Andre
Thank you. Thank you guys.