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- [00:00]
A
Morning everybody.
- [00:01]
B
Welcome to Crypto Town hall every weekday here at 10:15am Eastern Standard Time. Hope that you are all having a wonderful day as we dig into the topics of the day. What's happening in crypto markets and generally what's happening beyond. Very hard these days to have a conversation about crypto without all of a sudden becoming an expert in geopolitics, macroeconomics and American politics in general. That's exhausting, to be quite honest. Before we dig in to those topics, we do have an awesome sponsor today, which is Zero G gonna tell you a bit about them quickly. AI is reshaping the world, but right now it's stuck in the hands of just a few big players. But what if AI could run openly, verifiably and on chain? That's what Zero G is building. The world's first decentralized AI operating system open to everyone. Imagine a network where you don't just trade tokens, you train, store and run independent AI models at scale. No lock ins, no black boxes, no single point of failure. Just quick, cost effective auditable AI that anyone can build. Do you believe the future of AI should be a public good, not another corporate monopoly? Join us at Zero G AI. That's number Zero G AI. So listen, the topic today is hype up to fundamentals matter. It was something Dave and I were discussing, but Dave I think is having trouble getting on stage. So we'll table that for the moment because we do have Dan Spooler here. Dan, good to see you, man. Wanted to get the Clarity act update. We've got bad weather, we've got the AG Committee versus the Financial committee versus the House versus Project Crypto. So many things, everything being delayed.
- [01:32]
C
Good morning. Good morning, Scott. Yeah, thanks for having me. It's been, it's definitely slowed things down. Let's say it hasn't shut things down. Patrick Witt just did a great interview this morning, so he gave a great update too. Listen, I'm still, I'm still optimistic on it. I think it's going to happen. I think it's just a matter of time. It has been, you know, we're in, we're in a unique position because we represent pretty large swath of the industry. You know, quite a bit of our members represent the DEFI side. Quite a bit of our members represent the larger centralized finance CEFI side, let's say the exchanges such as Coinbase. I will say though, we've come further than I expected this year. Hold on one second. Actually I'm having some technical difficulties Give me one second.
- [02:18]
B
No problem. It wouldn't be spaces if somebody wasn't having technical difficulties. I don't know how soon Dan will be back, but if anybody else on stage has takes at the moment on what's happening with Claire, Charity act and Project Crypto, feel free to jump in. Otherwise I think we can maybe move to the other conversation until Dan is back. It's so hard to manage these because I just see people going up and down and falling off stage and right now I only see two guests. So I literally have no idea who's even here. I see Andre and Dan. Is there anybody else on stage?
- [02:55]
D
Hey, Scotch.
- [02:56]
A
Mark, my mic's working.
- [02:59]
B
Mark. Mark. I saw, I couldn't tell who else was speaking, but glad to know that there are other human beings that exist. That's good news. So listen, Dan, are you back?
- [03:11]
C
Okay. Okay, I think. Yeah.
- [03:12]
B
You sound good.
- [03:13]
C
Sorry about that.
- [03:14]
B
Keep going.
- [03:14]
C
All right. So yeah, last week we've been engaged the market structure legislation, Senate ag, they released their latest drafts of this market structure legislation. They called coined the Digital Commodities Intermediaries Act. And we held a good meeting actually yesterday with some of the senior staff on the Senate AG to discuss feedback on the draft. They postponed the markup which was supposed to be today. It's not now it's going to be on Thursday morning at 10:30am Knock on wood. The federal government is still out because of this winter storm. But now the concern is based on what's been happening, you know, just over over the country with ice. There may be concerns around another government shutdown because they had to extend the funding deadline and a lot of the Democratic senators now want to hold that Homeland Security funding rather and we think that could lead to a potential shutdown. I think the Kelsey market ads had it up pretty high last I checked. Disappointing. But again, that's another wrench in it. So we're going to host members again this Thursday to kind of go over it. We're doing another readout on the team. I'm, I, I'm optimistic. We're going to get something this spring. Will it be perfect? Probably not. If you look at everything in the past, the only way good legislation typically gets done is if everybody's pissed off. I know that's a little high level right now, but that's where we're at. Chris Lucas was the gentleman that we spoke with yesterday from Senate Banking and we've been in good touch with Tim Scott, of course, and Lummis and on the House. Listen, the House side was the Good version. We just got to get the Senate side done. I think the one good thing that's been uniting everybody is this antithesis towards the banks. Both the defi community and the centralized finance community, if you will, generally aligned on that. But what we don't want is anything ingenious to fall back.
- [05:12]
E
So.
- [05:16]
B
Great. Sorry if I see. Dan, I'm just going to mute your mic really quick, otherwise. Dave, did you hear any of that? I think you're here.
- [05:26]
E
Yeah. Can you hear me now?
- [05:27]
B
I can, yeah.
- [05:28]
E
I had to reboot my phone. I'm actually driving to a conference that Sidley's hosting with Commissioner Purse, who I actually had dinner with last night with a group of people and a bunch of legal people. You know, it's fascinating to. You listen to lawyers and talk, you know, the ones either from crypto companies or elsewise, and they kind of understand that it's really just a question of getting something over the line to get some clarity, not to overuse the pun, because the real work's going to be done at the exchange, you know, at the agency level. And probably the most important part of the conversation that we had, and that, you know, Hester, like, nodded at me violently. I know we. I've talked to her about this before, so I know she agrees, is that the biggest problem that we have today is the fact that being called a security in the world of crypto is considered a death sentence, which is insane. It makes no fricking sense. Because it was exactly the conversation you were having with Josh Frank this morning, which is why. Which is, I think, fascinating. You know, the. There is a part of the securities market, the OTC market, with significantly less overhead to get listed and trade, but it still has a bunch of archaic rules. Things like the accredited investor rules still apply, which is really ridiculous. And the things like the three quote rule, you probably wouldn't even heard of it, seasoning other sort of stuff. So the real question is, can the agencies, can the SEC and CFTC agreement on who regulates what, what sorts of things they want to regulate and move just get on with it? Because at that point, you have the ability for tokens to mean something. And to me, that's. That's the biggest part of the conversation. And just, you know, for those who watched Scott's show this morning, Josh Frank made a statement which I violently agree with, which is that token holders should get, you know, should know what the. And whoever sells it to them. I don't mean in the secondary market. I mean, the issuer should be held to whatever the marketing for that token was. And ultimately, without law, without a clarity act of some sort, we're never going to get those sorts of regulations. And you know, that's important. So, you know, really, that's what all this stuff is about. And considering, as you said, sorry for the little. I'm driving so I can't really look down and see.
- [07:56]
B
Yeah, you're breaking, you're breaking up a lot as well. But. Yeah, go ahead.
- [07:59]
E
Yeah, sorry, but to finish doing blindly land the plane. The reason why so much money has been diverted from the altcoin markets to digital asset treasuries and whatnot is because those are instruments people can actually trade and know what they are. And yet what did we find? People bought them not really knowing what they were. And there's not going to be any, any sec. There's not going to be a problem with that because they at least were told sort of what they were and the people who bought them didn't really understand it. So everyone who thinks that just being a security means you can't attract liquidity, that's obviously not true. Doesn't mean it's going to work. But it is what it is. I hope that.
- [08:36]
B
Yeah, yeah. We were talking about the fact that, you know, axel are sold basically to Circle in December and the Axilar token went down. And so the main topic here today is that hype token is actually up. And some would say that's because they're crushing it massively. The volumes that they're doing on commodities. Dave, I got to beat your mic. The volume that they're doing on the silver and gold pumps and such. So maybe fundamentals do matter in that case. But the larger conversation is once again, if a company or protocol or project actually achieves something in the real world, how does that value accrued to the token holder?
- [09:19]
E
Right? And to me, that's arguably the most important thing. And you know, hype, they buy back their token, right? And you know, you have to use it if you want to trade on it. Now of course you could laugh and say, well, but the US people can't legally, you know, wink, wink, nudge, nudge, trade on hype and can't legally wink, wink, nudge, nudge, open, you know, own it, but which of course is absurd and that needs to get fixed. But yeah, I mean, you know, BNB hype and some of the other tokens that are exchange tokens, whether DeFi or CEFI, have at least a path for that value to get communicated back to token holders. So Many of these others don't yet. The projects themselves might be doing well. It's just the question is, are you buying, you know, are you buying like Pudgy Penguins, right? Pudgy Penguins does deals, but it's not the token holders that benefit.
- [10:09]
B
Mark, Mark, I think you were trying to jump in, but I'm not sure.
- [10:13]
D
Yeah. Hey Scott, you know, you just said it's not the token holders that will benefit. And you're, you know, you're, you're talking about clarity and about bridging to tradfi to touch a potential shift in the conversation. I'll let you, Scott and Dave decide you want to do it. Yesterday for the first time I heard three incomings or I had three incomings on the quantum computer FUD or reality that Bitcoin will not be able to upgrade and is that why bitcoin's price is being held down? So that's just a street level view of what I've heard from two investors and then one, you know, high net worth retail person who are all in bitcoin and had cons and had, and wanted to know the validity of what the guy, what's his name, with a funny mustache that wanted to arm wrestle Elon. I'll think of it, I'll think of his name. But there's a, there's a digital asset person out there with a report saying, you know, 6 million tokens or Bitcoin are at risk in old wallets and you know, the risk isn't zero that bitcoin goes to zero. So that, that was, that was something that I thought was new and given the diversity in the crowd here, I want to know anyone else getting that kind of feedback? Again, this is a little bit of a diversion, but I bubble it because I haven't heard of this in a while.
- [11:48]
A
You mean quantum risk or.
- [11:50]
D
Yes, quantum risk that it's not five or 10 years out, it's two years out and the developers are not set up to provide enough protection and upgrade.
- [12:04]
A
Wallets etc like I have like. So my own opinion on quantum risk and Bitcoin is first of all, every major crypto asset essentially like the top 50 by market cap, are all eventually exposed to this kind of risk by a Scholz algorithm. So Bitcoin, Ethereum, Bitcoin, Cash, Litecoin, any major crypto asset. That being said, my bottom line on the whole quantum risk topic is it's not an existential risk for Bitcoin because at the end of the day you're talking about supply risk, potential Supply risk. I, I do think that especially those inactive coins, like the Satoshi coins, right, will be attacked, right? And will come to the market at some point, right? So it's definitely supply risk. But if you, if you talk about like the Q day when this going to happen, I think it's at least 10 to 20 years away. And the reason why I think that is, is if you look at the current state of quantum computing, there are around physical, 1000 physical qubits right Now I think Google's Willow, they have like 100 physical qubits. You need around 1 million physical qubits to be able to attack these wallets, right? So from thousand to a million is like 1000x, right? And based on Moore's law, you need at least nine doublings to go from a thousand physical qubits to like a million physical qubits, right? So nine doublings means based on Moore's law because like semiconductor efficiency increase, so doubles every, every two years, right? So you need like 18 to 20 years, right? If, if like the quantum efficiency follows Nevin's law, which has actually happened empirically so far, then so doubling. So Nevin's law implies doubling every year. So way faster than like Moore's law. But you still need these nine doublings, right? So you still need a like nine years, right? So even if like this kind of efficiency accelerates based on Nevin's law, which is like the upper case limit, right? So I mean, that's why I think that's at least nine to ten years to, to 18 years away. So ten to 20 years roughly. Right?
- [14:45]
D
Yeah. Andre, I agree with you, I agree with you and I brought it up because it's, it's, it's not new. And as Adam Back said, you know, he has incentive to think otherwise, which, that it won't be a problem. And I agree is that the people who are bringing it up, like Google and Microsoft, they want to say, hey, we're at the forefront, they want funding, they want to be seen as someone who's at the forefront of this and is bringing something to market. So I want to sort of highlight that it's out there, it's not grounded, it's not new, and you added some nice metrics to frame it so that everyone here can go back when it comes up to say, the Moore's law, the doublings. I think that's great metrics to, to solidify that it's out there and that developers don't have 12 to 15 months to figure this out. So thanks thanks for those numbers.
- [15:41]
A
Yeah, thank you.
- [15:41]
C
I want to just chime in on that too. On the quantum side, from the industry's perspective, you know, it is being taken seriously certainly by some of the major players, some of the bigger, let's say, publicly traded companies. You know, I go back to Coinbase, they just announced this independent advisory board to address these quantum risks. They announced it earlier this week and they're said to have this report that will be coming out on this topic. Now, I don't know if they're get. It's a serious existential question. Maybe from their. The shareholders are pushing this, we don't know, but it's definitely a concern for the broader, you know, ecosystem. I think that they are taking a serious list of these chains like Bitcoin, Ethereum, that rely on this elliptic curve public key cryptography. It needs to be secured for the future. Now whether that's five years, whether that, I don't think it's two years. But it'll be interesting to see how this plays out. And some of the experts they have helping them on this, they had a gentleman from Eigenlayer, they have folks from the university level. I'm not sure if anybody else has heard about this, but I think that's the first I've seen, at least from the industry side, take this collectively seriously and investing resources into the topic.
- [16:51]
E
Yeah, I thought that that was very important. I think that it's also extremely. You know, the person who talked to you, Mark, you know, contradicted themselves mid sentence, which of course is the first place you start. If 6 million coins are quote, attacked by people spending billions of dollars to gain possession, possession of them, they have zero incentive to do anything other than to maximize their return. Which means there's. It's not like they're going to get them and smash sell them to destroy it. What they're going to do is try to make money out of it.
- [17:18]
D
Yeah, it was Nick Carter who's been going out with that and he didn't want to arm wrestle Elon, he wanted to fight Hoffman.
- [17:26]
E
So sorry, I'm gonna defend Nick because what Nick has been. Nick is still a bitcoin holder, okay? He's putting his money where his mouth is. What he's saying is that the industry should take it more seriously. And he's trying to tell them to do it. He does not think it's an existential risk. He thinks that it is a bumpy volatility road that could cause issues. And that is absolutely right. He's basically just trying to say people stop ignoring it.
- [17:51]
D
Yeah.
- [17:53]
E
But, but here's the important thing. I haven't talked to him about it. I don't know if he's going to because he's in Miami. Maybe he's going to be at this conference. I'm going to. I don't know. But to my mind, if I were, if I had to guess, I would say he's per. He's happy that Coinbase is doing what he's doing and he wants more people to do it. And it's not about bitcoin dying. It's not about going to zero. Use the word zero. Bitcoin goes to zero, people believe it has no value and the networks fail. Quantum is not that. Because you would literally be spending billions of dollars in order to build something to take possession of an asset that you have zero incentive to destroy it. Yeah, I think that's the, that's an.
- [18:29]
D
Important point and it is important for messaging, just like you said. And that's why I like Andre's metrics, because I think Nick did. And I, I have not seen the report, but it's been quoted as your bitcoin can go to zero. Was I think in there. And I agree with the tilt of it. He's both, he's a bitcoin guy, he owns bitcoin and he is trying to beat people up. And the, the reception, the interpretation is fud. And that's why I like this kind of forum to help us clarify and educate so people can understand it like what you guys just did there. So thanks for that.
- [19:10]
A
But you know, bitcoin cannot go to zero because Adam back has like limit orders at like $0.01. Right. $cent to buy up all the bitcoin. But like even, like, even if like a quantum attacker attack, like the satoshi wallets, right. We, we estimated basically it's essentially like a back of this space was downloaded via spacesdown.com visit to download your spaces today kind of estimation. But nonetheless, if you like consider that like the Satoshi wallets hold around 1 million bitcoins, which is around like 30% of exchange supply. It's like 30% of exchange supply hit the market price dumps approximately by 40%. Right? But it's not like it's not the end of the world. I mean it's math. It's a massive dump. But nonetheless, I mean 40.
- [20:04]
E
You guys need to sharpen your pencils on your math. Speaking of someone who, who wrote, you know, who, who was involved in the building of the model that Robert Algren And Neil Chris built for impact cost. There is a square root function of degradation of impact as quantity increases. And so 40% is nuts. If you actually conducted an auction instead of. So let's say for the sake of argument, whoever bought, if it was considered legal and not theft, because if it's theft, then they're going to have to sell it much more carefully because then they can get caught. But let's just say for the sake.
- [20:37]
A
Of argument, that's so much nuance, right? I mean, they won't smash, dump it.
- [20:43]
E
If you in fact auction for the satoshi wallet. And basically said, because there's a lot of institutions who find it very hard to buy bitcoin because they worry about price impact. If you conducted an auction such as a secondary. So secondary offerings of stocks, mega cap stocks of the same size of bitcoin happen and they don't. Cause, I mean, I don't think I've ever heard of one being more than 10% down. But let's just say bitcoin is double the volatility. So it's 20% down. That would be the upper end of the range for what that will cost. Because you have to realize that supply often begets demand in situations where there just isn't liquidity. And so all the people who look at this are just looking at it based on empiricism within the bitcoin world and they're extrapolating it out to numbers that we've never seen before. Well, guess what? We have seen these numbers before in finance and they tell a different story. I mean, sorry, you literally triggered me. So I'm going to go back to.
- [21:40]
A
You know, I think the moment you see a single set leaving these satoshi wallets, the market instantly dumps BY probably like 20%.
- [21:50]
E
Oh, absolutely. People will do the lemmings in the way people trade in the crypto world. You're 100% correct. And, and that, that is true, which is why, you know, it's one of the things, one of the things that traders love about the, about bitcoin market, about crypto in general, is it's really easy to play on those. That's why October 10th was such an easy manipulation, I think, for the people who pulled it off. And they made absolute fortunes. I don't know who did it, obviously. I just know exactly how they did it. And you know, it's, it's. I was actually talking about this last night. It's like that's the kind of thing that, that is a big problem for crypto in the future. And one of the reasons why some people think that some market level of market surveillance would be helpful because it would give them, you know, they'd be able to sleep at night. I mean, people love 24. 7 trading until it's on a weekend when there's low liquidity and all of a sudden liquidity cascades are triggered on purpose, then nobody likes it. So, I mean, it's a. It's a really interesting question, you know.
- [22:47]
A
You know, another interesting question is, I mean, is there like a quantum discount in the price right now? Because Q day is like, it's like nearer than previously anticipated or anything. But I don't think there's something like quantum discount visible right now. Because, I mean, both bitcoin cash and bitcoin, so BCH and bdc, they're both exposed to the same kind of quantum risk. And bitcoin cash, if you look at the performance, right. Q4, I think, has outperformed by like 44% or something. Right. Same kind of risk.
- [23:23]
E
Right.
- [23:23]
A
Why has bitcoin cash outperformed?
- [23:26]
E
Right. It's really. You want the answer to that question? Because I'll actually answer it. It's because a lot of the people who hold bitcoin think of bitcoin cash as worthless. They wouldn't touch it. And so a lot of those people are the ones who are actually paying more attention to the quantum risk. I think bitcoin cash is a different animal. I mean, you can make an argument, a very strong argument, that bitcoin, that that 44% underperformance is actually the, quote, discount. Quantum is one of the reasons that's been cited for it, honestly. Really, it's more.
- [23:58]
A
I mean, the counterfactual. They're both exposed. Right. So that doesn't make sense.
- [24:03]
E
I agree. But what would happen. Here's the difference, and you want to. The perverse thing, if bitcoin, if both were exposed and both suffered the same thing, bitcoin would recover. I'm not sure bitcoin cash does. And so, yeah, you're right. I mean, it's actually kind of crazy. So if you really think that quantum is the reason, then that tells you that shorting bitcoin cash relative to bitcoin is probably. You've never had a better opportunity. But that's just me talking.
- [24:29]
F
Agree.
- [24:31]
B
How about bsv? Bitcoin Satoshi's vision from the real Satoshi Nakamoto. Craig Bright, how about that one?
- [24:40]
E
Yeah. You a big bidder on that one, Scott? Huge.
- [24:44]
B
I'm sorry, I can't like, honestly, I forget that not everybody who listens knows my sarcasm. So let me be clear. I have never owned BSV and don't believe that Craig Wright is Tosh Nakamoto. And the courts tend to. Yeah, but, yeah, absolutely astounding. So, I mean, interesting conversation. I'm looking through the news. There's a very, it's, it's a, it's just crazy how little is happening outside of politics. I will say I saw a very interesting article on Yahoo. Finance. I mentioned this on my show this morning that basically said massive FUD against MicroStrategy that implied that their purchase this week was somehow different than what they've done in the past and is exposing massive risk. And then I looked and it was an entire article about the fact that strategy is buying bitcoin not with cash reserves, but by engineering their balance sheet and selling shares. I just couldn't believe that this was on Yahoo. Finance, that somebody thought that all of a sudden this week when they bought 250 million worth after buying, I don't know, 2.5 billion the same way the last two weeks and I don't know, 700,000 Bitcoin after a few years that now apparently what MicroStrategy is doing is an existential risk. Have we dipped this far?
- [26:07]
D
Yes, we have. It is. It is. My son's a philosophy major and he's like, this is what Bojard has, has talked about, about the simulacra. Like, you know, that's why you need to meet people on forums like this and, and, and, and check your math, check your stats, get a reality check. Because there's a shitload of information out there, and if it feels good, it's going off as fact. Scott. So I, I, I don't think that's a light thing to talk about, meaning it's uber relevant. So you're right, it is screwed up.
- [26:43]
B
Yeah, I mean, I just, it was one of those things where I kind of read it in passing and then I just couldn't believe that it can make it to a headline on mainstream media when it's completely just a description of his entire playbook for all this time, but positioned obviously as a massive negative headline. Dan, I think you had your.
- [27:00]
C
Oh, yeah, you know, this is a slightly different topic. But now that we have Dave, we have Mark and these other experts on the line, one of the topics I wanted to chime in on was the Fed chair potential pick. And I've been reading more and more about Rick Rider as a, as a favorite Potentially the latest favorite. Seems like it changes every week. We don't really know. But he seems to be a lot more bullish on bitcoin as the store of value argument. A BlackRock guy, right? Does anybody have any thoughts on him and where and how that would affect.
- [27:33]
D
Yeah, I used to. I mean, I remember Rick back when he was at Lehman and he did his weekly investment grade call. I'm sure Dave, you know, knows him and others on the phone. He is a fixed income maven. He is a product of Wall Street. He is structured. He'd be a practitioner as opposed to the economist we have in now. I don't know if he can do anything different than, you know, print baby print. But as far as bitcoin, yeah, he. He allocated 1% to the fund. I think he'd be constructive. I would like to see him there overall for, you know, as far as being.
- [28:24]
B
I lost Mark, but I don't know if that's just me.
- [28:26]
E
Okay. I thought I got lost.
- [28:29]
B
God, man.
- [28:32]
E
The one point I want to make, Scott, because I'm going to probably lose you guys in a second, is the biggest reason why we should all care about having a practitioner in that job if Rick gets that job, is not necessarily about Federal Reserve monetary policy, because I think that's pretty much baked in the cake that they're going to print, baby, print, whatever you want to call it, they were going to run it hot. The big difference is the Federal Reserve has been a massive roadblock on the regulatory side. Think Custodia bank, et cetera. Having somebody who actually understands will almost certainly break that logjam. And that's a very big deal for the actual adoption type of ecosystem that we're looking for. So just keep that in mind. That is why it matters much more, more than what people are focused on, at least in my opinion.
- [29:22]
B
So I have to bring something up quickly because I see Gary on stage. Gary, I just saw a poll on X. It's very curious that. Asking if Gary sold all his bitcoin. This is from Fred Krueger. Last I checked, you and I talk literally all the time. And you were on my podcast last week talking about your target and acquiring bitcoin and that it's basically your new life's work is just to find ways to acquire bitcoin. And here we are with Gary. Sell all of his bitcoin. Did you sell your bitcoin, Gary? I can't hear Gary either. Can you guys? No, no. But I can answer for him because I can talk to him as well.
- [30:09]
E
He'S 100% still on BTC.
- [30:14]
B
Yeah, yeah, yeah. I was going with the very obvious. I mean, it's just like, what are we doing here? Is that your sarcasm coming through again? Yeah, sorry. No, I mean, I knew the. I knew the answer, but I was trying to tee it up and obviously his mic didn't work. Gary, is your mic working?
- [30:28]
F
Yeah, it's working. I don't know, maybe there's boredom when you get to, you know, when you come out of these really fancy schools, maybe you just go into such boredom that you. You just gotta. I don't know what the agenda would even be. Somebody could have just simply asked me, hey, are you selling your bitcoin? I was talking about NACA at the point and how stupid that decision was. So I don't really know how or why people spread stuff like that. The comment I made was, I don't see bitcoin getting to $100,000 tomorrow morning. I think there's sellers here, and I think we have to be pragmatic now. I'm not holding $3,000 bag, okay? And I've been sitting here stroking my bag for like five years, talking on podcasts. I'm buying at 80. Like, I've got a bid in at 87, 85 and 84. And I'm working on something to buy another hundred bitcoin. Like, if, you know, I think bitcoin's gonna slip here and people should be prepared. This is the part I would really wish that we could do better. Is just a group is, hey, how do we get people in preparation mode? It's not like you and I have stacks. You know, I'm going to come to your office tomorrow and grab a bunch of your cash you got and deploy it into bitcoin. We do a podcast and generate a lot of cash, right? That doesn't happen. What. What happens is I have to go create the money, find the money, and then deploy it. And I'm not going to do that sitting in a space at 11 o' clock at night. Like, I don't. I don't know why. So, you know, if I was like, I'm just a little bearish here because I just don't see the impetus. I don't see new money coming into this space. And that's the point I was trying to make. A lot of money's been wrecked in this space, man. I'd really like to know how much money has been lost in the last three months in this space. That money is not coming into bitcoin it's gone.
- [32:29]
B
Yeah. I just think it's so interesting because we've talked about this so many times, and I don't see, A, how they could conflate what you've said about Nakamoto with your position on bitcoin. B, saying like, it's not going to 100k tomorrow is ridiculous for that to be a premise for someone to sell when you're trying to accumulate lower. But C, I think you've been very clear whenever we talk and you talk publicly is that you wish you had just bought bitcoin instead of doing those other things at no point where you're like, nakamoto's down, man. I'm gonna sell my bitcoin. You were like, God damn it. I could have bought five bitcoin with that money.
- [33:02]
F
Exactly, dude. Like, like, I mean, David called me today, you know, or I had a chat with him because he probably didn't. Didn't love the. The post. But I'm like, bro, I picked the worst winner out the worst loser. And I'm just trying to help the community. I have a voice here. I made a mistake. I chased a fancy little glittery object and it cost me five bitcoin. I mean, that's like, that's not a mistake I want to make again. And it's not a mistake that, like, there's a lot of mistakes being made in this industry. It's fucking amateur hour here, really. Okay? Somebody's got a three thousand dollar bags and a. And a heavy duty MBA and they're not continuing to buy bitcoin. I don't understand that. I gotta say, it's one of the weirdest things to me in this industry. And I think that that's a common thread among futters is they seem to have really cheap bags.
- [33:58]
B
Yeah, I mean, he posted at some point because I was critical of something or other that meant I had no bitcoin. Also, just for the record, so at one point he said, yeah, I bet Scott has less than like, has no bitcoin. It was me and Dennis Porter or something. I don't remember, but I don't know where it comes from either. Mark, Andre, you both had your hands up. Mark first.
- [34:17]
D
Yeah, yeah, Gary. I think it's a good point about trying to be realistic. And then I'll start with saying I have no idea if it's going to 90, 100 or 70 or. Or lower on. On bitcoin. I just, you know, check. Check the facts. You know, your original thesis. And anything short term is silly. In this. And then as far as bitcoin treasury, you know, GBTC was a great thing to buy, not at plus 40, but at minus 40. So anything that wraps bitcoin, you know, be alert, you know, buying it, buying it at. At a. nav may not be the best decision for certain people. So being bearish is fine. And then the question is, Gary, like, I'd love to know your priority of events or lack of catalysts that give you theirs, because that's where we all get informed. And I think you've shared it. No new money.
- [35:19]
F
That's my thesis. There's no new money. And this industry has made it very difficult for the old money to come into this. I mean, extremely difficult. Like, the marketing is horrible. And the reason I'm saying this is I'm heavily invested in this. I would like to see the marketing better so that we don't treat people. They're 60 years old, coming into Bitcoin with $3 million, and they don't want to hear about 12 seed words. And then we make them wrong. Like, oh, my God, man, you're telling a guy that just deployed $5 million that he did it wrong. Why would you do that? And by the way, the customers that are investing in these people, like, you're confusing them also because we're basically saying that if you go to Baskin Robbins, all the ice cream is very different.
- [36:05]
E
They're.
- [36:05]
F
There's only one pure Baskin Robbins ice cream and everything else is derivative. Dude, all you're gonna ever sell is, like, you're gonna have one customer a day. You need 31 fucking different flavors. Wrapped, packed, stacked, like, yielding like. I look, look, look, the STRC product. I was with my bankers the other day. I'm like, you guys got me jammed in for, you know, a bunch of treasury notes, paying nothing. I want you to move those over to strc. And they didn't know anything about it. They're going to move 60% or 65% of my treasury portfolio that's getting sub 4 into strc. They're going to give me 75% loan to value on that. So I take a little haircut there. But look, I'm going to jack my fucking return up from three and a half to 11 and only pay 17% tax. Now, that product is essential for me to educate the bankers, and it's essential for me to be able to use Bitcoin to arbitrage the old system. The beauty of Bitcoin is that it can arbitrage the analog system that is us. That for me is much more valuable than self custody. Yeah, I lose my optionality on self custody.
- [37:19]
D
Yeah. I'm going to defer to Andre here because you just talked about there's a load of money but not a lot of incentive or education. And, and in my world of speaking to raas, I see it. But Andre, we had your colleague on here last week or a week or two ago and, and the question I gave him was when you guys go in, how many in the firm of 100 RIAs or would have are bitcoin or digital aware? And I think the answer was not that many. I don't know if you can expound on that.
- [37:54]
A
I mean, we conduct this kind of annual survey among financial advisors right, in the US and like adoption is rising significantly. If you look at like those financial advisors who've said like, oh yes, we've actually invested in the crypto assets already. I mean that that percentage has increased from around 22% I think in 2024 to above 30%. So like a third of financial advisors are already saying yes, we already allocated to crypto assets. I think it's a significant number. I mean, how many financial advisors are like, probably not right now, but like historically have like allocated to precious metals, Right? Probably not significantly higher. Probably the most recent allocations are higher. But like in general. But I think the trends is quite promising. I mean, talking about the adoption trend, Gary, you mentioned there's no new money coming in. I mean, I can share some internal intelligence from Bitwise. We've just approved a major, major warehouse just today. They've just greenlighted one of our Bitcoin ETPs, BITP for distribution. These guys, they have like, so this particular warehouse, they have 16,000 financial advisors. They manage around, I think over 6 trillion inclined assets. And now they can proactively put BITP into their client portfolios. That's actually big, big, big step, right? And we've seen many of these kind of big wirehouses, green lighting, just Bitcoin ETFs. And it's just happened like last month, right? It's not, not happen like in like mid-2025, just happened in December. So I think we're just about to see this kind of lot of capital and to enter like bitcoin on this bitcoin ETF spread. So I think that there will be new money. And this kind of institutional demand tends to drive performance, you know, and I wouldn't be surprised if like price starts grinding higher. Flows keep coming because of this kind of institutional ongoing Institutional adoption. And there might be other catalysts, right? I mean like the announcement of maybe Rick Rieder or any other guy as fat share. Right. Or maybe some kind of precious metals rotation in the bitcoin. I mean, silver looks extremely throppy. I don't know what you think, but like if you look at things like fractal dimension, it's like clearly signaling like at least like tactical top and silver. Right? But yeah, there might be different kinds of catalysts. But yeah, I think the institutional option keeps going as far as I. I can see.
- [40:47]
D
I love you dropped fractal dimension there. It's a little a nod to Mandelbrot. Nice job.
- [40:55]
A
Yeah, it looks frothy and I, I think it's hit like below 1.25. The 65 day fractal dimension for silver. So at least like the last time this happened. I just posted the chart today. The last time this happened, silver went side sideways for one year.
- [41:12]
E
You know.
- [41:17]
B
I keep getting cut off. Guys, I think we've covered all the topics for today. Another good show, but you know, I don't want to keep it drawn out when we've had a great conversation already. And I need to privately call Gary to buy all of his bitco and sell it to me. That's why I'm mad. Gary get a discount on it. Come on, man. Anyways, guys, that's all we got. We'll be back tomorrow for another crypto Town hall. Thanks for tuning in. See you tomorrow.
- [41:42]
D
Bye.
- [41:43]
A
That's fine. Thank you guys.