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Potential major bitcoin signal is flashing which is that we're having massive inflows especially Yesterday into Bitcoin ETFs and institutions buying while apparently early whales and retail are selling. Could this finally be that transfer of wealth that we've been looking for in the bitcoin space showing its face? We're going to discuss this and everything else happening in the market and crypto news of course with TMAN and Andrew, but with a very special guest, Matt Hogan. Let's go.
B
Let's do. That's dope.
A
Good morning everybody. Happy Tuesday and welcome to the show. Going to go ahead right now right after you subscribe and like or do whatever it is you people do out there. I don't want to get into your personal business. And bring on Andrew, Matt and Tillman. Good morning gentlemen. How are you?
C
Morning Scott.
A
Dark where Matt is, I can tell you that he, he works hard.
C
We start early out here.
A
He's one of those hard working guys, gets up early. You like that? All right. So this one kind of shocked me when, when I opened up the terminal this morning at and by terminal I mean my phone. But I wanted to sound like I like was a Bloomberg analyst. Yeah. Bitcoin ETF saw 471 million in inflows yesterday, the highest since the US Iran war began. I don't know why that's the metric we're using but BlackRock led with 182 followed by Fidelity with 147. Institutional demand is picking up again. You can see it here on the chart. And interestingly I showed the study from river yesterday that showed I think it was 69,000 Bitcoin bought by institutions in the first quarter. While I think it was 61 or 62 were sold by retail in the first quarter. So you had this massive institutional buying. Governments were like 20,000 or something. Then ETFs I think the netted out pretty low, a few thousand Bitcoin and retail selling like crazy. So what's going on here?
C
That's exactly what's going on. I mean as you know we meet with institutional investors all day long. It's still a raging bull market. In that market they are just interested in bitcoin. They're moving into bitcoin that hasn't slowed down. When we go to the large wirehouses they're increasingly engaged with bitcoin as well. It really is a tale of two worlds. They're, they're not that concerned about the quantum threat. They're, they're just seeing this as a Natural cyclical opportunity to allocate. And retail hasn't seen that yet. I don't know when they will see that. Maybe the guys have some views, but that's the story. There is just no bear market in institutional interest in crypto right now.
D
We should probably delineate that. You know, Bitcoin ETFs, like they're not just inherently institutional, by the way, like, you know, retail money is going into those ETFs. It's just different retail money than, you know, anonymous, funny looking avatar, crypto, Twitter people, okay? They're different segments of the, of the market. These are people that have accounts at Morgan Stanley, ubs, Merrill lynch and, and Wells Fargo. Those people are allocating to bitcoin and those are the majority of the flows. It's not just some Sultan of Saudi Arabia that's dumping $100 million into ibid on any given day. It's thousands upon thousands upon thousands of people making additional allocations to the Bitcoin ETFs. And again, we haven't been able to talk with Matt about this, but I'd be very interested in his thoughts on the Morgan Stanley Bitcoin ETF and what a truly big deal that is as it relates to quote unquote, retail. But retail being high net worth, ultra high net worth folks. Morgan Stanley doesn't do that unless there is a, a mega signal from their core constituencies that says we want this product. Right.
C
I think that's absolutely right. Right. They are the, the creme de la creme of, of this, of this wealth management space. And they're the largest firm in that space. And they haven't launched many ETFs. They haven't put their name behind many ETFs. I've said this before, I think it's a big difference between allowing your clients to access third party ETFs versus launching your own ETF with your name on it. And I think it does speak to that demand, I would say. You know, I think a lot of crypto natives wonder how this is possible. A lot of these people have zero allocation. You have a zero allocation and you're looking at this market, you're like, ah, great, I have a chance to get in. Right? You have none of the emotional damage of the up and down and pain of the last few years. You just see it strictly as an opportunity. So I think this is a trend with legs for years. I mean the Morgan Stanley ETF isn't even out, right? It's coming. And yeah, I think it's A really big deal.
B
Yeah, I, I would echo that. I think if you measure, you know, corporate adoption as a percentage, I mean, you know, the 1% to 3% allocation, I think is kind of unarguable at this point as a hedge. I think most people that have heard the narrative believe that, but now they have to put it in practice. And I think that's where we're going to see a large catch up. I, I don't think that many companies have tackled this, and I think that we're, you know, something that always is pressing to me is if you do have zero allocation, like Matt said, it's, it's one of those begging questions. What other asset can provide me all the coverage points, all the asymmetric upside, all what Bitcoin can provide you, they're really after you do your due diligence. Some takes years, some take very, you know, months. But at the end of that, you know, that educational process, there is no asset like Bitcoin. And so you come back to the realization of, oh, I've got to do something. And I don't even think we've begun that journey. So I think this rising tide floats all ships, both from retail. As you know, like Andrew just pointed out, there's, there's retail mass adoption happening or systematic, systematic adoption happening. But I think also from a corporation perspective, it's the only way that to rebuild the middle class of America, in my opinion, as quickly as we need it to be rebuilt, is to educate small businesses as to how to save money in Bitcoin. Some, you could justify a way larger percentage than 5%, 10%, 15% based upon their cash position and what their, their overhead costs are. And some you, you can't. But Michael Saylor is a great example of taking a business that's kind of dying on the legacy front and reinventing themselves. That's one example. That's a very extreme example, but there's a huge spectrum there that can help small businesses as it relates to Bitcoin.
C
Yeah, I absolutely agree. I'll add one more thing from the sort of institutional corner, a story that I heard when I was talking with Top 50 Endowment a few weeks ago that it allocated into the space. And the reason they allocated was that their peers were allocating. And I think that speaks a little bit to what you're getting after. Once you see a few people doing this, it becomes the bar just getting off zero. And they had made a sizable allocation just because they didn't want to be off beta compared to their peers. The Other endowments in their region who had allocated as well. And that's another way that this sort of spirals out.
A
So Matt, do you think that when we see a spike in inflows like this, I mean, we've talked about inflows and outflows forever, but yesterday was really sizable. Right. You know, over over 400 million. Is that because some random large entity finally allocates? Because it doesn't seem to necessarily track price directly. We had a nice little spike yesterday, but when we're moving between 67 and 69,000, it doesn't seem like, you know, these huge ETF spikes are really shown in the price.
C
Yeah, I think those, those, those one day spikes and it was concentrated in three providers. Often some of that is like a large hedge fund putting on a trade and deciding to distribute it across the. The best flows are when you see everybody get flows, all nine providers or whatever, that is the best possible signal. Sometimes you just see BlackRock because they are the largest. This one felt a little bit like someone putting on a trade, but I do think if you look at that chart more broadly, it's a generally positive story given the direction of price.
A
Do people utilize the BlackRock one? Because if it's a hedge fund, they have more size and options around it so they can put on like a more complex trade, basically, I'm assuming.
C
Yeah. As painful as is, as it is for me, liquidity begets liquidity in ETF land. So the big get bigger and it's the easy button for a lot of people. Yeah.
A
What do we make of the fact that apparently, I mean, I can see, I can show you an article that shows the exact opposite from like two days ago, but here we are. But as I said, the other side of this is not only that retail selling, but we've also seen some data that whales are once again selling here around 70,000. So we know they sold above 100 in size. We know they continued selling down. Most metrics showed that they somewhat stopped when we got to 60 and we kind of rose back to 70s. Seems that now alongside retail, some of them are selling again, but like I said, inflows are up and institutional buying's up. So.
C
Yeah, yeah, go ahead.
D
I would just say that it's a really healthy market is the best way that I could say it. Because if, if you've got quote unquote institutions or whales selling, who are they selling to? Well, you just, we just Talked about Bitcoin ETFs gobbling up Bitcoin. Right. So, so there's, there's a healthiness to the market overall. That's generally the way I look at it. I don't try and deconstruct are whales selling and what does that look like? What does it mean on any given day? I don't find that all that interesting. What I do find interesting is the fact that blackrock, again with the liquidity in the options, that particular, the scale of that, that market, you know, their options there have gotten so big and so influential in the space. It's, it's hard to quantify honestly. And the fact that they've created a second ETF to capitalize on that particular market, it's really something. It, it, there's two ways to look at it, right? It, it's, oh, okay, there, that's the scale of bitcoin and the interest in bitcoin and the volumes and liquidity they're going through bitcoin. All of that's generally speaking a good thing. But also, you know, it's kind of a funny looking meme where BlackRock does this and then it does this and then it does this. It's just BlackRock doing a bunch of stuff with BlackRock. Right. So is that good? I don't know if that's necessarily great.
B
So it's called a flywheel. Andrew, come on.
D
But you know. Yeah, a flywheel. But when it's created, you know, just amongst BlackRock doing BlackRock things for BlackRock. Yeah, I find it, I find it interesting. I'd love to get Matt's thoughts on that. Right. That particular product and again, what it will do to things like volatility with bitcoin, which is often a feature, not a flaw. Yeah, just like to get his thoughts on.
C
Yeah, yeah, a bunch of thoughts about the option overlay space, which is really, really big. I mean even at bitwise, we do a lot of SMAs, we have a lot of people in kind bitcoin into our ETF so they can do an option overlay strategy on it. I'll say two things. One, it actually explains to me part of the reason bitcoin is down so much, even though the underlying statistics look like a balance between buying and selling. Because if you hold bitcoin and you're continually writing calls against it, you're selling away the upside. And I actually think there's a lot of this not on chain selling happening through these option overlay strategies who remain long technically but have given away their upside in exchange for income. And I think that's part of the reason we're down so much, they're free to do that. Their alternative would be just to sell directly. So it's not like, that's like added sell pressure versus but, but this is what they're choosing to do in terms of it's, it should compress volatility over time. Right? The more liquidity, the more instruments. It should compress volatility over time. It can create situations where volatility sort of ramps into itself as markets move, so you can get accelerations. But you, you wouldn't be surprised to see this sort of channelization in a market with a lot of option overlay strategies. And that's, that's kind of what we've seen. And, and I think, I think, look, I think volatility will not decline as much as it has over the last five years, but will continue to decline as these markets get more institutional, more liquid, and there are more derivatives on top of.
D
It is compelling. That, you know, two years ago, everybody on the planet, every analyst everywhere, was like, well, you know, Bitcoin ETFs, they'll launch and they'll do okay. And maybe the, the asset class will bring in 5,7 billion in the first year. And, and it completely blew all that away. And then the options happened and the options have absolutely, you know, NASA launch blown everything everywhere away.
A
It, it doesn't launch things. It's fake. The earth's flat. Yeah.
D
Yeah, right.
B
So I, I think there's a, there's a bit, let me point something out. I think there's, that we're talking around and we're, we're, we're not talking to, which is there's a migration that's happening from cold storage and from self custody into paper products as a whole. I think people want paper products for the convenience of it for the custodian. You know, the, the value of, of the, the lack of complexity that it injects into the situation and the risk that it injects all of these things. The, the options are just another version of paper that's, you know, and ultimately it's the, which is the dog and which is the tail. And, and we know the answer to that. And I think a lot of bitcoiners are struggling with the realization of the answer of that, which is that the paper gets a lot bigger eventually and we're seeing real time. And so yes, we're seeing a lot of whales sell. I know of many that I've heard that are selling a lot of bitcoin, but they're all, they've been in the game for a long time they've had more than a 10x and so it's going from weaker hands because they've already had all their upside that will change their life forever. They capitalize on that to people who are satisfied. If institutions saw bitcoin go back to its all time high, they would be having parades. That's asymmetric upside compared to what they typically invest in. And yet all those same people that I just mentioned would be very disappointed if it capped out at 126 and started falling back down again. So it's just the mindset of who's on the other side of the buy or the sell. And we're seeing a new wave of investors, the biggest wave with the deepest pockets, the most liquidity come into the space saying this is a value for me, this provides me. And I, I think that's incredibly encouraging. I mean you try to follow smart money in life and, and that's about as smart of money as it gets.
C
Yeah, I think that's exactly right. It is a, a generational shift. It's changing the asset, it will change its shape of its returns in the future, but it is a huge tanker size amount of money that is coming into the space. It just takes time. It takes time.
A
I think it just confuses people that price hasn't followed, you know, and, and of course, I mean we've said it a million times, but when all coins don't move, the crypto people yet freaked out. Right. So like, you know, still not much hope there for coin number 146 to catch that institution.
D
At the same time too though, you know, again Matt, tell me if I'm wrong, but when you're doing presentations at, you know, trillion or billion dollar RIAs and Morgan Stanley's, the Wells Fargo's of the world, you're not going to whole lot of questions about altcoins, are you? That coming up much?
A
Come on, they want to know about Shiba Inu,
D
you're just not.
C
No, that is right. Yeah, they're interested in Ethereum, they're interested in Solana and maybe Chain Link and then that it sort of peters out. Yeah.
A
To that end like do they ask about the tokens or they ask about the narratives? Because I would be surprised if they're not saying hey, how do I participate in tokenization or RWA or whatever? And they're not asking like, you know, is that through some specific token? Right.
C
No, that is exactly right. How do I participate in stable coins and tokenization? It's bitcoin stable coins and tokenization. Those are the only two things you can talk to them about in the reports. Yeah, yeah.
A
Annual report says tokenized assets representing real world assets are expected to see continued growth. With some projections estimated market could reach 13 trillion by 2030. IMF is talking about tokenization, which by the way, they're the evil empire, so I'm not sharing that. But I mean this is right, these, this is what shows up on these people's terminals.
C
Absolutely right. And it's worth noting that 13 trillion is a lot more than 20 billion, which is about where we are. There are many zeros. And so, so they see that and they want that exposure and but yeah, but they don't want to talk about the 15th altcoins. A nuclear winner in altcoins. You know, a lot of them are just gone. That's just going to be it. And that's going to weigh on crypto retail sentiment. I think for a while the signal
B
there is that utility has finally arrived. I mean we've talked about utility and the altcoins side of things for the last three cycles. And you know, whether it's XRP settling Swift or you know, you just go back to every narrative in every altcoin as to what their true use case is. I think Wall street said Bitcoin's use case is this and money followed because it, it proved to be very valuable as that use case. And I think that we're going to see the same thing in altcoins. But it's very hard for an altcoin to compete with tokenized oil. We know the utility of oil. So now you have true utility in real world assets that come, that is coming in to compete with hypothetical utility. It's not, it's not going to go well for the hypothetical of things. Now it doesn't mean that altcoins or what you know, what Matt just said is they want to know about real world assets and what, what follows that is okay, Ethereum, I can do that on Solana, I can do that on right now. But there will be many, many more that you can do that on. There will be better, there will be different. There, all of that is just maturing. But there is one thing that we do know that tokenized oil went From I think 25 million in volume on day one to 1.2 billion in day. See the utility of tokenized commodities and that's a very, very easy place to start because you know, it's, it's the, it's, it's better for Everybody, including the exchanges.
C
Yeah, I think that's exactly right. I think we've seen what works in the tokenization space, which is when the blockchain is in the background and no one knows about it, basically.
B
Yep.
C
That is what works. That worked on Hyper Liquid. It works on Polymarket. When's the last time someone talked to you about the underpinnings of no one cares, Right? No one cares. That's. That is the application that, that you want to see. That's where the growth will be.
B
Yep.
A
How do you index for that when you're creating products?
C
Well, good segue. You know, look, I think what you're going to see is a lot of ETFs that are thematic in nature. I think you're going to see ETFs that focus on themes like stablecoins and tokenization and other areas of the market. I think you're going to see a lot more interest in crypto equities, to be honest, because that's another way that this gets explained into Trad 5 that they can wrap their heads around. But I think the days of single asset ETPs, there's probably hyper Liquid, maybe like the last one left that could have some interest. But generally speaking, I think people are going to want to own groups of assets to gain exposure to themes and aren't going to care about this versus that versus that. So the days of debating Ethan Solana, those days aren't going to exist for the institutional community. They're just going to want to own all of that.
A
To the extent will it be blended with tokens and equities? Obviously, if you have a stable coin index, it's gonna have to circle. Right. But I don't even know. And maybe there's some tokenization side to that, but, you know, are these going to be effectively blended indexes?
C
I think you'll see that. I think you'll see that there are some reasons, some arcane regulatory reasons that, that's a little bit complex, but it's a, it's a solvable problem with things like Cayman subs. But yes, you're going to see those blends. I would even add, you know, and I've made this pitch to a few people. One way to think about things like ETH and Solana is if you own, let's say, a financials index and you don't own ETH and you don't own Solana and you don't own Chainlink, do you really own the financials index? I'm not sure that you do. Right. If you own the queues and you don't have crypto in it, do you really own technology? I'm not sure that you do. So I think to your point, there's a separation of equities and tokens, which is not something repo really care about. They just want exposure to the theme. And so I think you're going to see those two come together increasingly in ETF products.
A
When.
C
I can't give you my, my layout, Scott, I fear my competitors might be listening. But look, it's high on our mind. Exactly, it's high on our mind. And we're hearing it from clients, right? We hear when we talk about stablecoins and tokenization. I gave a big talk on that topic to Barron's, the Barron's top RIA conference, like their 100 largest RIAs. At the end I have this complicated slide that says how to invest. It has like 12 things on it and it's a terrible slide, but that is the answer to how to invest. Like there is no one answer. You can't just buy one thing. It's like buy these five crypto assets and then you want some Circle and some Robin Hood and some Coinbase and whatever. I would love for that slide to just have a ticker. So we're working on it.
A
Yeah, that makes sense. Andrew, I think you're about to say something.
D
Yeah, I mean that, that's just, I mean that's classic wealth management, right? The reason why Matt's like, I wish this slide didn't have 17 things on is because I know my audience is thinking, I don't really want to have to, I don't have to explain this to my 68 year old client who is, doesn't know what any of this means.
B
How many phones come up at that slide and they start taking pictures.
C
It's, it's, it's absolutely right. And these guys are busy, right? They, I've said this before, but the average wealth manager spends I think 8% of their time on portfolio construction. And if crypto is 2%, it's 2% of 8. Think about how many minutes a week that is for them to think about this space. It's like, it's like rounds to zero. So they need something easy. That is the solution that works for them.
D
Yeah. In that world, assets under management is the gain. It's, it's basically the 92% game. So what do they spend 90 doing talking to other 68 year olds with lots of money to bring them into their, into their practice. And so yeah, I mean, there's a reason why in wealth management there really are no more guys that are sitting at their computer, you know, doing, picking out allocations for subsections of their. They farm all that out to, to folks like bitwise, frankly. And so, yeah, so when to, to Matt's point, when he's got a slide that he doesn't like, he knows why he doesn't like it, because the audience is like, oh boy, I wish this was similar.
B
Well, it's, it's just like what we were talking about. It's like the complications of this industry and this sector have kept a, have been a giant hurdle for people that they don't want to go over. And so making it easy and combining one, one thing that y' all are talking about, that's really fascinating to me. And just from an economic outcome perspective and modeling perspective, if you're able to combine through ETFs, exposure to real world businesses that have tremendous cash flow, for example, or tremendous IP value off chain, real world value, and then you're able to combine the upside of exposure to pretty much a broad array of emerging technologies on the platform blockchain side, you're getting this risk reduction mechanism as a part of the whole, that is really difficult to manage in a segregated way. Like, it's incredibly difficult that the rebalancing effort would have to happen daily. You're not talking about the 2% or the 8% at that time. You're talking about 98% of your time. Just because. Why? Well, because all those assets are so volatile, the risk reward ratio changes every day meaningfully. And so therefore your allocation should be reflecting those changes. And yet no one does that. This is the vehicle to make that, I mean, just like incredibly simple and get massive broad exposure across our entire space. And if you look back at like the ICO craze, 2017, for example, the best people, the people that made the most money just had a little bit of money and everything and they just waited, waited till the ping pong ball bounced and they cashed out. And that's essentially what this is going to allow you to do, but at the same time de risk the entire effort. I mean, that's, that's pretty amazing.
D
Yeah. Yeah.
C
Well said.
A
Yeah. I want to talk, moving on just slightly to the sort of regulatory clarity environment, whatever. I don't even think we have to talk about the Clarity act because it's not a real thing. That's just my very humble opinion. Sorry, did you guys see that? Eleanor Terrett was like quoted as saying that they were very close to a deal. And she was like, I never said that. And it was like massive news that we were all getting it. The coinbase Graywall had said 48 hours. He's like, I didn't say that. I mean now we're just making stuff up.
C
That's amazing.
A
The thing we're not making up is that we actually have an SEC and CFTC that are trying to do things right. And Matt, you were I think, the first really to point out the fact that regardless of what happens in the elections, regardless of what happens with legislation, we gotta still three years here of pro crypto regulation and we can effectively take that time to show that we matter and become too big to fail as an industry. But here he's floating reg crypto for fundraising. And this is like really one of the things we've been looking for a lot of clarity on basically saying how can you raise money for a crypto company for a token? How can you do an ico? Things that you would have never obviously heard under the Gensler era. And he's saying that we're getting close to a proposal for how this would be done. So I mean, maybe just shifting to some positivity here. Regardless of what's happening on the legislative side, it seems like we're going to get a lot more clarity from the regulators and that's going to continue to be a trend for, for years to come.
C
Yeah, I mean imagine this headline four years ago the market would have been, you know, the God candle to the upside. This is an incredible thing and we do have this unique three year window to really prove that crypto matters. I think it's going to actually, I think there's an opportunity for people who are following this because I think people have such bad memories of the worst parts of the ICO effort and such bad memories from that era of crypto that I bet they will be skeptical of these new efforts under this red crypto offering. But I think the reason those were such failures was there wasn't the right regulatory standard to get them into it. The idea of raising capital for a new token project, or raising tokens that actually act almost like equities and have real claims on cash flow are good ideas. And I think we're going to see a big flowering of those ideas under Atkins, sort of regardless of what happens to the Clarity Act.
A
Yeah. And it seems like the CFTC won't get in their way, which would have also been an issue before.
C
Right.
A
We would have had this turf war between the SEC and the CFTC and they're actually working together here for what seems like very rational, obvious. Yes, we should actually know if, how you're allowed to raise money. Still.
C
One of my favorite like news stories was how shocked people were that the SEC and the CFTC were talking to one another. It just tells you how backward our regulatory environment was that, that was like, that was news that they might collaborate on regulating their financial market. It's unbelievable. But yeah, I do think we're gonna look at, comes from a token background. Right. He was on the, the token sub task force of, I forget, the digital Chamber or something. Yeah, but that is his background, so this is something he wants to do. It's clearly going to happen and I think you're going to see a flowering of amazing entrepreneurial ideas. I'm pretty excited about it.
D
Well, four years ago, by the way, that headline was just the meme that if you did anything in crypto, straight to jail,
A
quite literally 100 degrees.
D
No, no, no, no. So, yeah, you know, something that's come that far to the other side is we're actively working on creating, you know, frameworks that have to do with tokens and token launches and, and, and all of that stuff is really, really, really good. And you know, generally speaking, in the world of politics slash, you know, regulatory stuff, three years is a lifetime. And so you, you, you, you get yourself, if they're able to do this at, at the, at that level and it takes hold and then some level of scale is built around that. Very difficult to roll that back. It's hard to roll that back. Clarity or no clarity. When you've got meaningful stuff that has been built and everyday people are using it for good things, it's tough to say, well, let's just throw all of that in the trash. So it may be able to stand the test of changes in Washington, changes in regimes. At least that's the hope. So I'm glad they're, they're getting after it and doing it, you know, quickly
B
so well, they have to. I would argue that with in the last six months, what's happened in AI has accelerated software development at a rate that we could have never hoped or guessed. It's commoditized. Something that used to be the massive bottleneck of every company is like, how do we develop this? How do we test it properly before we roll it out? Software development now is an overnight process, literally. And testing it is having 15 agents test it and back to like, it's completely changed the game. So if you think about like just from a macro perspective that regulators have had a hard time keeping up with innovation in our space. Without that, you're not putting this cat back in the bag. But in three years from now you're going to see more software written and more use cases come to market and more people using those use cases than we've seen in the last 17 years at crypto. By a long shot. I mean just by an absolute.
A
Yeah. And the irony is that like regulation and legislation aren't going to stop that anyways, as we saw with crypto, like, you know, it's like water flowing. It's going to find the cracks and it's going to continue on. I mean, I vibe coded a website in five minutes as a joke. Like I was like, I need a new website. And I said it to our little open claw agent. Knowing what you know about me make a website, zero information. I mean I haven't launched it yet, but it literally made me a website that would have cost like 20 grand. Yeah, yeah, six months ago. And it, you know, five more like I know nothing about anything. Change this number, change this. I had a website literally in less than an hour and was doing it passively on the side.
C
Yeah, absolutely. I mean this is, this is probably the alt season that everyone's waiting for. It's the combination of AI capabilities and this new token framework is probably the actual alt season of 2026.
A
So how do we invest?
B
Clip that, because that's the headline of the show.
D
Don't miss that one. Yeah, it's.
A
It used to be where I get stuck though is like how do the people who've been here for so long believing in it, okay, you just buy bitcoin, I get it. But like the people who really deeply believed in these altcoins are bag holders are hoping they'll go up. How do we participate in this? Becomes the underlying technology of the institutional. I don't know how I profit from the DTCC tokenizing things. It's cool.
C
I'm not sure you will, but I often think Alpha exists in the gap between reality and expectations. And particularly in this situation. To go back to what I said, I think people are going to be more skeptical than they should be about some of these new experiments and they're going to dismiss them because of historical bias. And if there is an opportunity in this space, it's to evaluate them rationally in a new regulatory framework. I think you're going to see ideas that failed in the past be retried and be interesting. Not Every idea. Maybe not Uber for crypto, but if you do like, you know, I could think of a lot of sort of failed experiments, I don't know, music, etc. You're going to see all those reattempted again. And I do think there will be opportunities between sort of people historically dismissing them and this new reality. That'll be pretty interesting.
B
It reminds me very similarly to when, you know, torrents were popular and people were, you know, taking music and movies for free offline and downloading libraries of them and it was all illegal, right? And it was an unregulated market, but the technology was so good that all the big players took notice and said, we have to move to this. And what they do, they, they fought Napster, they fought limewire, they fought bittorrent, they fought all of those competitors that had the competitive advantage of being first market movers. And then they launched itunes and Amazon streaming and YouTube TV and that, that is the same exact industry, but one being unregulated and unsupported by Wall street and one being regulated and supported by Wall street. And, and we're seeing that shift take place right before our eyes. And, and you know, the alpha to me is betting on the second fiddle. It's easy to see the utility in something like hyper liquid. And then you go, how do, how do I make money on investing in hyper liquid? Well, you just look at their framework and then you look at real world brands that are coming to market. I'll give you a good example of this. It doesn't take a rocket scientist to figure out why Mr. Beast and the Ethereum gang are getting arm in arm like that. Doesn't take a genius to figure out that's the intersection of real world brand and blockchain technology at its finest. We've never seen those types of collaborations before at scale. So, you know, I think there's, there's going to be really clear opportunities as you see this technology be integrated and adopted.
D
I don't know, I kind of think Scott's the Mr. Beast of crypto. You know, if we were, I can see Scott doing a video where he's carrying the bags of money and then it's more money, and then it's more money.
A
You know, running that off, you can
D
pull that off from my lips.
A
I will have the only daily crypto show on mainstream media.
C
I heard that. I heard that was luck, though. That's what I saw
A
actually, though, I found out that the producer's dad watches this show and told him that this is who they needed, which is crazy. I thought I had all these, like, great ideas of how it came about. It's like my dad watches you.
D
Yeah. Our public can confirm that your audience is very dad. Like, let's put it.
B
They drink a lot of La Croix. I'll say that
A
back, though. I almost fired everybody over that limoncello I was drinking last week.
C
Pledge?
A
Absolutely pledge. I mean, Matt, listen, anything else we're missing before I let you go? I mean, what do you, you know, as you've kind of alluded to. No, there's no bear market when you're having your conversations, which I think is very encouraging. But is there anything else that people are talking about, questions you're getting that we may have missed?
C
Questions we're getting. We do get some questions about Quantum. We get some questions about the L1 space and whether they'll be able to really accrue value in that space. But broadly speaking, people just now have these two narratives. They have bitcoin, they have Eth Solana, other sort of stablecoin and tokenization plays. They're going to invest in those. I think the more we actually see those perform a little bit differently in the market, the more that will continue. So if you want to see if that's happening. But look, we're pretty bullish for the end of the year. I think we're doing okay, given the geopolitical turmoil out there. The fact that we're just sort of hovering is fine with me.
A
Yeah, I'll take it. That's a win. We're going to be just fine. Now you say it.
B
Everything's going to be okay.
D
Will be okay.
A
Thank you for joining us at six o' clock in the morning. Have a wonderful day. I. I can't imagine it getting any
C
better than this, but it's a good way to start it. Good to see you guys.
A
Good to see you, Matt. Hey, so what do you guys want to talk about?
B
The Clarity Act? I. I'll say this. Have you guys changed your odds ratio of it actually passing? The one thing I will say that I keep coming back to zero.
D
Yeah.
B
Higher than zero. Well, here's the thing. I just think. I think I may have, in my equation of. Of prediction, underestimated how badly the banks need it. And so if you go back to that central, you know, they're the ones that really want this. And then you say, okay, it looks like Coinbase just got awarded or is in the process of being awarded. Awarded Fed access at the Fed window,
D
or they've been given A trust bank charter. Yeah. Trust, yeah.
B
Well that's Fed access. And so my point is, is like the, the, I see some, some compromise in the real story and the fact that yeah, maybe USDC is the, the thing that Coinbase is going to have to fall on, the sword that they're going to have to fall on and it's not going to be included as something that can be provide yield. They may be willing to swallow that if they get to be a bank, big bank and they get to be up at the table and whether they're giving yield on USDC or whether they're giving yield on deposits, if they're a bank, who cares? They can still disrupt the market as somebody who's giving disproportionately back to the depositors. Right. They can still do exactly what they're trying to do. But you know that there's, I know there's a lot more sticky points and it's passing but it seems like there's concessions being made on that front and or compromise being made and it made me, my ears perk up and kind of take us pause and say, you know, what are the odds of this thing actually getting pushed through? I'd love to hear Yalls opinion about that.
A
Zero. Yeah, we're doing wars right now, guys.
B
True. We are doing more wars right now.
D
I, I will say clarity or no clarity, the fact that, you know, crypto exchanges are looking more and more like banks anyway. Yeah. You know, Kraken has a fat. A Fed master account. Kraken, right. It's one thing to say Coinbase and getting approval for a, you know, a trust set up, that's, that's kind of a bank, but it's not, they can't take deposits as a bank. But listen, they're going to do the trust thing and they'll do the next step. The next step. The next step. You know, three years from now all the major crypto exchanges here in the US will be basically banks and then all the banks will offer most crypto stuff anyways. So it'll just be all kind of one thing. So you know, kind of to what we were talking about before, if that's happening anyways. And by the way, that happens at the regulatory, you know, level. Right. They're, they're granted these things from, from regulatory bodies. What do we need the Clarity act for anyways? It all effectively is just going to happen. So we'll see. And, but, but is there a world where, because Coinbase feels like, all right, if we play a little Bit of ball here. We'll get the next two steps that we want to get from a banking standpoint, like in the, in the, in the back room of this negotiation. Hey, we promise we'll give that to you guys if you guys just give a little bit here. I mean that's how stuff gets done anyways. That wouldn't necessarily surprise me. Coinbase has to weigh how much do we really want to piss off, you know, the, the true kind of crypto people because they'll see right through that again. It's, frankly, it continues to be just a bit of a mess.
B
I, I, there's something in my gut that says it's going to get ramroded. I don't know why that's, I feel, I feel something in the wind. We'll see.
D
Well, one way could get ramrod rotted is like the Trump administration just needs a win of some sort. Like they just keep kind of what
B
I mean, man, like, I'm just saying there's a lot of things getting ramroded these days. This could be one of them. I, I don't know. We'll, we'll see.
D
I don't know, I'm kind of on this Scott. It's Mr. Beast Crypto Kick right now I'm so
A
stuck on who's getting ramroded.
D
I knew you'd go there. I was waiting, I was waiting for it.
A
I have to get it out at 9:00am before that.
D
Yeah, yeah, yeah. Let's talk about Archbubel.
A
I think we should look at that website, man.
D
And that's it. You know what, you know what we didn't do, we didn't create it out of nothing with some sort of funny looking Claude thing that you're talking about. We actually worked on this, we got
B
real hum, we got real humans working on, on this website and I, I will say it's a lot, lot cleaner. I like it much better than the last one is like, like Matt was talking about, simplicity is good as it relates to delivery and you know, we're trying to make this process as simple as possible for, for everyone. It used to be in days of old automation, no one understood it, no one could get their hands on it, no one understood the value proposition. It was a black box. You know, obviously we've taken it upon ourselves to change that and to educate people as to what the primary use case for automation is, which is to alleviate time constraints and the convenience of having your will monitoring the market at all times. Especially with 24, 7, 365 markets that becomes imperative and then removing the emotion because most of the time when you're interacting with the market markets, that it's a highly emotional endeavor and a lot of people don't have the stomach for it and don't have the time for it. And so, you know, when you start to just build the foundation around those two principles and you start to then see the flexibility of the software and how you can program it to do whatever you want it to do in the market, it opens you up to this infinite, you know, possibility of, of really building a very detailed, very complicated strategy. But doing it very simply with just, you know, drag and drop click buttons and then watching that execute on your behalf is one of the most intoxicating feelings. I won't ever forget the first time I saw it because, you know, having a proverbial robot in the market for you, acting on your behalf and listening to whatever, you know, commands you give it, it is something very unique that most people haven't experienced but before. And so we, we want that education for everyone. We have over 20,000 people that are using the software suite, 700 of them we, we would call concierge customers roughly. So you're welcome to come and use the software to my point is it's free to use 20,000 plus people are using it for absolutely no cost. And that is something that I think is incredibly important. Important as it relates to onboarding people into the crypto space is making it easy and giving them things that they understand and know how to use. And so I urge you, if you haven't used these types of tools before, to, to check them out and come to our site, schedule a demo, get with one of our sales guys because they are incredibly talented at the software. All of them were previous customers, or the vast majority of them were. So they know the software kind of in and out and they love helping people set it up and, and learning about your individual story. So it's, that's, that's really where our passion lies. And we're just seeing, with the continued rise in awareness of crypto and also just the treasury management aspect of corporations and, and treasury companies that need these types of tools. It's just, it's very refreshing to be able to deliver something that is, has such recognizable value and you get so much goodwill built with your customers. So we're very thankful, very appreciative of all the people that have taken the time to, you know, trust us with their time and we're glad that they see value in it. So if you're interested in it, please come and check us out. We, we'd love to get you started and teach you all about it.
D
The best way to get started too is, is again, use the free product. Put 800 into your Coinbase account and you know, do a couple of setups on our website and set those setups to buy $50 worth of, of Bitcoin in, in our arbitrage algorithm and, and just watch it work. You don't have to have 5 grand or 10 grand or 50 grand or 100 grand to run this thing. Put 800 in your account and then watch it do its thing and then you'll be convinced when it does its thing at 2:30 in the morning when it's impossible for you to be involved at that point and you're not, you're not putting meaningful capital at risk. You're just learning how to use something that everybody is going to have to use two to three years from now when all markets are 24 7. When a movement in Tesla or Nvidia in your portfolio does something meaningful at 2:30 in the morning, you, I don't care who you are or who your advisor is or what company you've got assets with, they don't have humans, they're not going to have humans sitting there at 2:30 in the morning. So familiarize yourself with this technology. We've been doing it for a long time and yeah, not only that though, beyond the, you know, algorithmic automated version of everything that we do, we have wonderful people. Like Tillman said, there are wonderful people available to you to talk about what it is that you're watching, what it is that you're seeing, the why, the how, the when and the what. And I think the best commercial for, for Arch Public is the fact that, you know, six months ago Scott started out with 50 grand in his account and he's more than 10x that amount into his account based on what he's watched these tools do. Not much more can be said.
A
Can't stop buying stuff.
B
I will say like, you know, like we've all, you know, learned over our careers. You do make your money in, in the trenches, right? When, when everybody else is running, especially retail and you look at those opportunities that we've all been around to see. Remember when Bitcoin crashed to like 3, 300 bucks or 3,500 bucks and, and everyone said it is absolutely dead, like it's going to zero. And then, you know, so it's, it's one of those things where you're really Buying a risk reward ratio at every entry point and that is ever changing. So you, you need management tools, you need to manage the risk of volatility and, and doing it in a prudent way when, whereby which you're never over allocating and you're not doing it predicated on emotion and you're not doing it based upon your availability. All those things lead to a better outcome than if you were a slave to, to those, you know, variables. And so you know, the, the most, the biggest compliment I ever get is you've given me time back, you've given me 15 hours of my week back. That's actually something that was said to me last week. And you know that, that, that is what it's for is to reduce complication of life. It's like what Matt was saying. If we can bundle these assets and make it easy for people to get exposure, broad exposure, where it's, the risk of volatility is, is muted. We have a lot more participants than if we don't. And so that's what this is about is, is bringing in participants and giving them a good taste in their mouth when, when they arrive and showing them that it's not all pump DOP fun and these crazy things. You know, it there's real legitimate infrastructure being built and to that end, I mean we work with all the major exchanges. So if you want to, if you have a Robin Hood account, if you have a Coinbase account, a Kraken account, a Gemini account, any of those, you know, and even more you can hook our software up inside of your brokerage account and run whatever algos that you would like to run or schedules that you'd like to run within your existing account. So you manage it, you turn it on, you turn it off. Completely user driven and increasingly easy to use from an interface perspective. So we're really, we're focusing on making
A
it that for people it's the best. Well thanks. I use it every day because I don't have to use it. You know.
B
That's right. That's exactly right. Yeah.
A
We set it and forget it and life continues on. So for guys, for those of you who could living under a rock, here it is@archpublic.com you can check it out there. By the way, I just have one thing that I was dying at my news team. I don't know. Obviously we've had the quantum debate and I heard Matt Hogan bring it up and Dave Weisberger was very passionately talking yesterday about how he thinks that that's what's suppressing price. And then there was this debate over quantum bitcoin mining, not just the signatures. And then this paper came out from these guys. BTQ BTQ Technologies publishes research showing quantum Bitcoin mining will require 10 to the 23rd cubits and more power than a star at current difficulty.
C
Right.
A
So bitcoin, quantum bitcoin mining is a complete non starter for those. So this is about signatures and there's companies like this and others that are obviously working on post quantum cryptography and securing the wallets. But this basically is like you need more power than the sun to do that. Like what are we doing here? I'm not saying not a threat to the old wallets, but like I think that this study at Cornell University maybe we went a little, little too far.
D
Maybe, maybe a little too far. Listen, I said a couple days ago and you know, heaven forbid I, I hurt anybody's feelings but you know, I just, I like to listen to guys like Adam back on this. You know, he's measured and also he's doing something about it and he's probably forgotten more about bitcoin and crypto than most people actually know. So just kind of stick it there, you know. Yes, we're working on it. Yes, we, you know, let's make sure that we've got it covered. But at the same time, like, come on, relax everybody. This, we're long ways away from the, you know, Adam has said, whether it's in a, a direct post or a reply, we're, we're decades away from this stuff. And, and to the point of that, and, and Tillman can speak to this a little bit, you know, more eloquently like the amount of power and amount of just actual space you would have to, have to, to have those types of computers working on for some reason this small little asset called bitcoin versus a bunch of other stuff doesn't, I don't know, it doesn't seem to make sense. Right.
B
People, people don't understand what role role bitcoin mining plays in the electrical grid and the infrastructure, but let me explain it. It's the only thing that will use power whenever it's available, especially when other things don't want it. What do I mean by that? There's this thing called on demand, like power and the, the demand that we see on our grid, you know, varies throughout the day. So you know, when everybody's getting up in the morning and heading to work at you know, eight o', clock, you see a ton of usage of Power. Why? Because everybody's, you know, opening the refrigerators, making breakfast, blow drying their hair, this massive spike. So the power companies have to generate power based upon peak demand, based upon how much demand they have to serve at any given point during the day. So they have to over generate at all times because you're never at peak demand for very long. It's just these short blips. So what do you do with the over generated power that you're not using in the grid? Well, it bleeds off into the atmosphere, guys. It's impossible to store that energy. You can't put batteries in a building, stack them to the roof and make it a Walmart distribution center sized battery. We don't have battery technology that's good enough to store power. That's the truth. There's a limited limiting function there. Solid state batteries may come around and change that, but we're not there yet is the point. And so when you generate power at peak demand levels all the time and you're using power down here, there's this delta of power that could be applied to something useful. So the argument is zero, that through economic incentive everyone that's in the bitcoin space has already found that power, that, that, because that's the cheapest power for them to operate on, which is a natural incentive for them to find it. And you can find, you can look all over the world and the number one reason why a bitcoin mining place exists is because they found cheap power. That's literally the number one variable that they look for. And so it's, it's a misnomer to say that bitcoin's using all this power. No, we're not using it. And bitcoin's putting it to use. It would be no different than if I saw an oil well out in West Texas that had a massive flare off gas component and they just built this massive tower and every night I drive by there and they're just lighting the sky up with natural gas burn off well, why are they burning the natural gas? Well because they're not there for natural gas. They're for there for the oil. And they don't want to mess up the oil flow because that's where all the money is, in the well. The gas is just a byproduct of the oil production. They don't want it, they don't need it. And guess what, it's equally hard to store natural gas. It's like electricity. You can't unless you have a pipeline to hook it up to what do we do with all this gas that's coming out of the pipe? Well, that's where flare offs happens. They just light it on fire and burn it into the atmosphere. So you can put a coin plant on that flare off gas. You can take that natural gas, pipe it into a generator, light it on fire under, you know, combustion and generate power and then sell that power back to the grid so that the grid has more on demand power generation at any given point in time so that they can produce more, more power in the power plant and equal. And so all these things are happening, but bitcoin is solving these problems. Guys, it's literally the, the, the neutral party in this equation that goes, hey, we just want cheap power. In fact, if you can give us free bleed off power, we'll only use that. You see what I'm saying? So, you know, I, I don't see it as a problem. But number one, number two, quantum computing is a total hoax. The amount of power that it uses is more than a bitcoin. Like it's. Are you, are you kidding me? Do you know you have to keep a quantum computer at absolute zero for it to function? You know how much power, I mean, you go ask, go look at what CERN is doing and look at how much power they're using to keep things at zero and collide at them. Like it's, it's a. Again, the, the base, you know, value of proof of work, which is Bitcoin at this point is the fact that it always takes more power to break it, more money to break it than gold that's in the vault. That's.
A
It's just not worth it.
B
That's not worth it. Exactly.
A
So many things while you were talking a. I don't. The moon doesn't exist. I've been told that on Twitter of late. Not even that we didn't go there. It doesn't exist. I don't know. Two is that CERN broke the world in 2020 during COVID and we're actually living in a parallel
D
on.
A
And then, and then when you were doing this thing, all I could think of was Ricky Bobby,
D
what do I do with my hands? What do I do with my hand?
A
But that's what I heard. But apparently we don't even live in the same universe anymore.
D
Well, I'm again, I'm old enough to remember that there's a lot of, of academic papers that have been written that have not been worth ultimately the paper they've been written on. I mean, you, you, you can Create an academic paper about the fact that the moon doesn't exist. And, and when it comes out and there's a bunch of signatures and it's from, you know, Cornell slash Google and like, well, they must be some smart people there. But it, but then, you know, three years later you go back and read it and it was, looks absolutely ridiculous. By the way, has anybody watched the movie An Inconvenient Truth lately? That actually plays as a comedy now based on the claims that they made about where we'd be today. So, you know, again it's, it falls under the heading of thou protesteth too much on the whole quantum thing. It really, really does.
B
Well, it just lets you, it tells us something about ourselves, which is that fear really is, sells fear. Fear will is the driver for, for everything. And you know, to think that bitcoin has survived in this pure state for 17 years and that there's a boogeyman that could disrupt that, that's a pretty fear inducing narrative that I didn't surprise me that people kind of latched onto
A
it and that's why Price is down. Then hold on to your asses when it gets.
B
Yeah, that's what I'm saying. Yeah.
A
I never know what to do with my hands. It's like the old days. Once 10, all bets are off at 10 o'.
D
Clock.
A
Guys, if we run over, I do whatever I want.
B
Listen, I, I, I think that, you know, that big studio change that you did, I think it did elevate your game because you, you're so childish on so many fronts that, that brings you to, into this quasi. Like, you know, if, if I just screen shot this right now I look like I'm on cnbc. But if you actually watch the show, it's like Sesame street. So
A
Seinfeld, Eddie murphy, raw. It's basically Citizen Kane, you know, like
D
Mandalay Industries, Vandalay, Yahoo.
A
Yahoo. We've got like the lower third.
D
Oh yeah.
A
Hacked twice today. And it's like. And then we've got the pardon your pardon the interruption stories going down the sides like bang. I like it. Like, dude, we're gonna be producing.
B
Yeah, I love it.
A
You're not gonna believe it, but I'm still gonna talk like this. It's gonna be sick.
B
I don't even really work here where I am.
A
That's what makes this so hard.
B
That's what makes this so hard.
A
I know this looks good, guys.
B
That's Seinfeld and Kramer. By the way.
D
What do you got in that?
A
Like 11? How late have we gone over. We're done. Check out Arch Public. It's been great. I've had a great time. You've had a great time. Just remember that if you want to mine Bitcoin, you're going to need computing more powerful. Thanks,
B
dope.
Host: Scott Melker
Guests: Matt Hougan (Bitwise), Andrew, TMAN (Tillman)
Date: April 7, 2026
In this episode, Scott Melker is joined by Matt Hougan from Bitwise, alongside Andrew and Tillman (“TMAN”), to unpack a seismic shift in the Bitcoin market: massive institutional inflows into Bitcoin ETFs—even as OG ‘whales’ and retail sell off. They explore what this “transfer of wealth” really means, the drivers and implications of institutional adoption, evolving crypto market structure, the waning influence of altcoins, new ETF trends, regulatory shifts, and address hot topics like quantum threats and tokenization. The mood is dynamic, blending market analysis with candid humor, practical analogies, and industry-insider perspectives.
“There's no bear market in institutional interest in crypto right now.”
– Matt Hougan (02:08)
“Morgan Stanley doesn't do that unless there is a mega signal from their core constituencies that says we want this product.”
– Andrew (03:01)
“The paper gets a lot bigger eventually and we’re seeing [it] real time. We’re seeing a lot of whales sell...to people who are satisfied if bitcoin just goes back to ATH.”
– TMAN (15:00)
“A nuclear winter in altcoins. You know, a lot of them are just gone...that's going to weigh on crypto retail sentiment.”
– Matt Hougan (18:28)
From Single Assets to Thematic ETFs:
Simplifying for Advisors:
“Imagine this headline four years ago—the market would have, you know, the God candle to the upside. This is an incredible thing...”
– Matt Hougan (29:10)
“Quantum computing is a total hoax. The amount of power that it uses is more than bitcoin… Are you kidding me?”
– TMAN (57:38)
On Institutional Flows:
“There's no bear market in institutional interest in crypto right now.”
– Matt Hougan (02:08)
On ETF ‘Retail’:
“Morgan Stanley doesn't do that unless there is a mega signal from their core constituencies that says we want this product.”
– Andrew (03:01)
On Altcoin Sentiment:
“A nuclear winter in altcoins. You know, a lot of them are just gone...that's going to weigh on crypto retail sentiment.”
– Matt Hougan (18:28)
On Regulatory Change:
“Imagine this headline four years ago—the market would have, you know, the God candle to the upside...”
– Matt Hougan (29:10)
On Quantum Threats:
“Quantum computing is a total hoax. The amount of power that it uses is more than bitcoin… Are you kidding me?”
– TMAN (57:38)
This episode captures a pivotal moment for Bitcoin and crypto markets: institutional capital is pouring in, even as old hands and skeptical retail exit, triggering what may be the much-discussed “wealth transfer.” The product mix is maturing—from single coins to blended thematic ETFs—with utility and ease of access trumping speculation. Regulatory tides are turning, giving space for new forms of innovation, and looming fears (like quantum threats) are calmly debunked. As Matt Hougan summarizes, “We’re pretty bullish for the end of the year… The fact that we’re just sort of hovering is fine with me.” (39:16)