On The Brink with Castle Island - Mark Lamb (CoinFLEX) on crypto derivatives and stablecoins (EP.317)

Episode Date: May 9, 2022

Mark Lamb, co-founder and CEO of CoinFLEX joins the show. In this episode we discuss: Mark's entrepreneurial path in the cryptocurrency industry and the insight behind starting CoinFLEX The history and market landscape for crypto derivatives platforms The state of the stablecoin market and how flexUSD is positioning for USA launch The regulatory environment and how this is impacting trading venues and stablecoin issuers. To learn more visit coinflex.com and follow Mark on Twitter

Today in the podcast, I sat down with Mark Lamb, the co-founder and CEO of CoinFlex, a derivatives exchange and the operator of the FlexUSD stablecoin. This was a fun conversation with Mark. We touched on a variety of topics. We talked about the history of crypto derivatives exchanges, talked about the role of the perpetual swap in the crypto markets and potentially, eventually in the traditional markets. And we also talked about the growing stablecoin market. I think you'll enjoy this one.

So without further ado, here's my conversation with Mark Lamb. Matt Walsh and Nick Carter are partners at Castle Island Ventures. All of these expressed by them or the guests on this podcast are solely their opinions and do not reflect the opinions of Castle Island Ventures. You should not treat any opinion expressed by anyone on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only is an expression of their personal opinion. This podcast is for informational purposes only. Brought down by bad mortgage investments, Lehman, which has 25,000 employees, will be liquidated.

The federal government loans American International Group, AIG, $85 billion. This is a different kind of market, and the Fed is asleep. The federal government is stepping it to stabilize Fannie Mae and Freddie Mac, the two mortgage giants that have been threatened by the housing crisis. The Bank of England has pumped 75 billion pounds more into Britain's ailing economy with a new round of quantitative easing. And print a couple trillion dollars, and all of a sudden, people start to worry. So out of this worry, we have something called a Bitcoin. Bitcoin. All right, Mark, well, thanks so much for joining today on the podcast.

Great to be here. So great to be here. I think you might be our first guest from Dubai or calling in from Dubai at least. So that's a first for this podcast. Well, Dubai is becoming a major hub of crypto. So I'm guessing I won't be the last. Yeah, I don't think you will be at all. And it's exciting that CoinFlex is located over there. So maybe for the listeners who aren't familiar, we'd love to just start with the background on CoinFlex and how you came to start the company.

Yeah, absolutely. So I moved to the UK when I was 18. I was in university and sort of working on a virtual currency startup at the time and was looking at sort of alternative forms of money. And I both looked at kind of modern inventions like flus and beans and different attempts, basically attempts to create Bitcoin. And then also just kind of the monetary history of gold versus different fiat monies and how long government currencies tend to last before reverting back to a gold standard. And I found Bitcoin in 2012 and thought this is amazing. went all in, got levered in, and went even more in. And basically, in 2013, I had been

trading Bitcoin for a while effectively as a market maker. I was kind of 20% of the UK Bitcoin volume and decided we need to do this as a more professional capacity as an actual exchange. So I created CoinFlor, which is the first UK Bitcoin exchange. That was kind of the majority of Bitcoin volume up until 1718 and started realizing. that we'd sort of monopolized the wrong market, being a large spot fiat on ramp and off ramp and Bitcoin channel in the UK was kind of cool and profitable, definitely, but the real money was being made in derivatives and also just impacting the world, being able to have a global impact rather than an impact pretty limited to one country. So I moved to Hong Kong, which was kind of

the hub of derivatives at the time and still is a major hub of derivatives and a major place for us. And so moved to Hong Kong, started CoinFlex with Sudu, my co-founder, who had been in the derivatives industry for 25 years and was newer to crypto. And so we kind of had very complementary backgrounds and both had sort of these ties to the trading world of DRW. We also both had a very strong passion for physical delivery versus cash settlement, which is a way that futures are settled. It's kind of a niche thing. It's not necessarily something a lot of people cared about. And we thought, you know, traders are going to really care deeply about this. It actually turned out to be very, very useful, but not for traders, but more from a fixed

income perspective. And really, physical delivery was what allowed us to create the first interest-bearing stable coin. So we created physically delivered futures. And then we iterated on that to create physical perps, so perpetual futures contracts that are deliverable as well. And that kind of spurred the creation or that required the creation of a repo market, which is kind of a centralized borrow and lend market where, you know, right now you have

companies like Genesis and BlockFi doing this bilateral borrowing and lending. So they're kind of borrowing on one side and then lending out to institutions on the other side, kind of like a bank where they're acting as, you know, both sides of the equation. But there's no real marketplace for this where you can trade on an exchange in a borrowing or a lending capacity. And so we created a repo market that was that. And we needed effectively, if you think about the Fed as the largest liquidity provider or lender in repo, in traditional finance, we need an equivalent of the Fed in our ecosystem.

And so because we had that need, we kind of realized, and some of our large users were telling us this as well, why don't you create a stablecoin that pays interest and lends into this repo market? And so we did that. And we created FlexUSD. It pays interest three times a day. It's the only stable coin that pays interest. So if you think about USDC or Tether, you're lending them your dollars.

In exchange, they get to go out and earn all the interest associated with lending out those dollars and buying treasuries and other products using those dollars. And with those customers, they have no obligation to pay any interest. So it's a sweet deal for Circle or Tether or any of these other stable coins. But with FlexUSD, we've basically. basically flipped this model on its head, where instead of giving the money back to Tradfi and keeping it within the kind of antiquated and inefficient traditional finance system, we're plugging the money into crypto repo markets, specifically on CoinFlex.

And that's where it's earning a very high rate of return. You know, the average six-month return is something like 12% APR on FlexUSD. So it's a much higher rate of return, but it's also, it's a return that you're holding while you're using a stable coin. So you're not locking it up. You're not staking it. You don't have to have any liquidity issues. You can be literally trading it on Dex's and on CoinFlex and using it as collateral and making payments with it to your employees. And while you're doing all these things, using the capital as productive capital, you're getting paid interest three times a day. And so that's what we've just launched in the U.S. and that's what we're really excited about.

It's fascinating. I mean, there's so much to dig in on there. One of the things I'd love to your perspective on is, you know, I don't have a lot of people on this podcast that were there at the very early stages of crypto derivatives becoming a thing. And so maybe just talk a little bit about what that was like in the moment around who the active participants were, what that landscape looked like and how it's evolved over time. Yeah, I mean, the first crypto derivatives exchange was run by a Russian guy. It was icy bit. And it was incredible. You know, they had invented these Bitcoin margined contracts that they had to solve the problem of how do you offer leverage without having a clearinghouse standing behind you? And so they had, you know,

they kind of created the real-time margining systems that you see used today by most of the major crypto derivatives exchanges. And they did it in an environment where crypto was, I mean, I think when they launched, crypto was probably in the double digits or maybe even single digits. So they did it in a very, very brutal environment to be offering leverage in and volatile environment. But yeah, it was really this really incredible transformation from ICBit to the Chinese exchanges, OKX and Holby, and also 796, which is a derivatives exchange that almost no one remembers, but they were huge. And then maybe even before all these, you could consider Bitcoinica derivatives,

but it was really levered spot trading. And then after all that, you know, Bitmex came around. And I would remember for a long time, coin floor in the UK on Bitcoin GDP volumes was doing more volume than Bitmex. And we saw this Bitmex exchange and we're like, yeah, you know, I mean, as a percentage of BTCUSD, it's tiny. I remember one time I came into that market, put in a bunch of orders, and then I got emailed from them. Why are you placing so many spam orders? Can you stop doing that? You know, you're putting too many orders in the system. So it was, it was incredible. You know, the whole liquidity was like minuscule. And they struggled for a long time.

And it's really, I mean, really inspirational story to me as an entrepreneur, because that is kind of the process and the journey. And, you know, sometimes you go a long time without finding product market fit. And then, you know, they invented the perpetual swap. They had a bunch of different kind of futures contracts. They did stock index futures. They tried to make A. shares futures a thing for the China audience. You know, they did all sorts of things. When they invented the perpetual swap, that was that was when it really started taking off because the perpetual swap, you know, futures trading from kind of Chicago style, commodity style futures trading has this concept of a one month or a one quarter future. And it usually trades at a premium or discount

to spot. And in crypto, it's always been a premium on average. You know, over long time skills, it's a premium, right? And in ICBit, it was a 200% annualized premium for two years. You know, so you could buy spot, sell futures, make 200% annualized on your dollars. I never did that because I didn't have any dollars. I was all in Bitcoin. So there was no room for me to do that trade. But, you know, there was this interesting period where you had a bunch of people trying to trade futures, but they didn't really understand how, because they didn't understand why they should pay more for Bitcoin in the future than they do today, even though they were bullish on Bitcoin. So there's there's a logic to the leverage you can get, you know, means you might want to pay

more for Bitcoin in the future than today, you know, leverage has a price. But people didn't understand traders in crypto didn't understand how to price that leverage into a one month or a one-quarter futures contract. But as it turns out, they don't mind paying daily or three times the daily funding fees. So if the contract looks like Spot, if it's, you know, Spots trading $40,000, $100,000, and the perpetual contract is $40,105 or $100, that they can tolerate, that they can get their head around. And so that was really, I think, from a retail perspective, and even from an institutional perspective, there's a number of benefits. And that was really what made BitMex a thing and what made the perpetual swap a thing because even today, Bitmex is much smaller, much, much smaller.

But the perpetual swap is the dominant instrument in crypto derivatives. And we've iterated on it as well. We've taken the concept of a perpetual swap and we've created a perpetual swap where you have the option of taking delivery. So you can say, I'm long 100 Bitcoin and right now it's leveraged. But tomorrow, maybe I feel like converting that into spot and basically saying, I'm going to put down the cash and claim the Bitcoins. And that's not something you can do on any other derivatives exchange, but it is something you can do on CoinFlex. Do you think the perpetual swap is one of these crypto innovations that will bleed over

into traditional financial services? Yes. If you think about what it can replace, so it's not just futures, it's also, especially in the context of our iteration on it with repo, it's also stock borrowing and lending. It can replace. we've thought about and talked about with different stock exchanges, how it could, what makes single stock futures work? Single stock futures have really commercially failed. And I think the simple reason is it's difficult to be doing the basis trade on, you know, many, many, many, many instruments

and in kind of these types of sizes. And so there's a ton of benefits to perpetual futures all throughout the traditional financial system, perpetual futures would make a really big difference, even just in the flexibility, because when you have a commercial need, if you're an agricultural seller, you know, if you're a corn seller because you're a farmer and you have this agricultural need to sell at the end of the month, yeah, sure, like a monthly future, a quarterly future makes total sense. But if you just want leverage and you don't know when you're going to be delivering something or selling something or whatever, you know, a monthly date is pointless for you. And it adds this cost, which is not just mental, it's financial as well, of rolling, which is basically, I'm long one futures contract.

Okay, expires happening. I now have to log into my account, sell the future by the next month's future. And that's expensive. Trading fees are incurred. All sorts of problems. You know, the nice thing about a perpetual future is you can literally open a position and hold it for three years if you wanted to. Or two weeks and five days, you know, or whatever customizable time frame. you want. And so, yeah, I think it is going to bleed into traditional finance. Traditional finance is

very stagnant and difficult to change and difficult to move. So I think it'll bleed in very slowly, but it will totally make its way in. And once it's in, it will enable all sorts of types of trading, borrowing, lending, and activity in Tradfai that has never been possible before. I think so, too. It has to be an amazing journey as an entrepreneur just to see the landscape changing so fast and the basis for competition here is just moving at just light speed compared to the traditional market. So you referenced a bunch of competitors over the years that aren't around really anymore at scale. How do you think about the competitive landscape right now around derivatives and what does it take to be an enduring franchise in the category?

Yeah. So the biggest thing, I'm a big fan of Peter Thiel, zero to one and these types of concepts around how competition is for losers. And the biggest thing we try to do at coinflex is not compete, ideally with anyone. We have a few products that are sort of in the intersection of a few different industries. So we're a stablecoin. So we're competing with stable coins. We've got repo. So we're technically competing with our lend platforms. And we're a futures exchange. But really, the way we see ourselves is we want to be the cheapest source of dollar funding in crypto. And we want to do that by having the only interest bearing stable coin. Because if we can get flexu-so, so the thing I notice is Binance Open Interest is about $10,11 billion,

and the biggest stable coin is $80 billion. With FlexUSD, there's a correlation. If someone mints a billion dollars of FlexusD, coin flex-open interest is probably going to go up by a billion dollars, because traders will take that latent capital, and they will buy repo. They will be long the futures. They will be aggressively borrowing dollars from the funding markets that we've created. And that will result in a billion dollars of open interest. And so if we can get flexus D to be a major stable coin, let's say top five or sixth, if we can get it to be about $10 billion,

we should be bigger in open interest than finance. But it wouldn't be by competing with finance on the active trading customers. It's really by going after this perpendicular market, which is passive capital. Passive capital, you know, we just see it as anyone who's not trading. You know, finance, FTX, a lot of these exchanges, they're very, very focused on traders, right? So FTCS's motto is even buy traders for traders. And a lot of these exchanges, they're very, very focused on active traders because that's who pays them the bulk of their fees. You know, they are the best customers from the perspective of, you know, who pays the most fees on an average day. But they're not sticky at all.

They will shift exchanges if there's a better offering, right? all the people that have switched from Bitmex to Binance, you know, all the most active of those traders, they could switch to another exchange. So what we're really looking for when we kind of realize this around the non-stickiness of active traders and also around the power of passive capital in a market, you know, if you can get passive capital to bribe liquidity, we basically realize that we should be focusing all of our time on making flexuosity an enormous stable coin. You know, that's why we're launching in the U.S.

That's why we're trying to get all these family offices and retail customers minting flexusti, especially customers that have nothing to do with crypto. You know, we want the people that are not even thinking about crypto, but we tell them, look, you can, with your bank account, just send funds and mint flexusty and you're automatically earning interest three times a day, auto compounding, a variable rate, but usually a pretty high rate. And we'll explain to you exactly how it works. and we're getting audited and all sorts of things, right? So when we realized we could do that and create a pool of capital that wasn't going to leave us,

no matter what, even if the fees are better on a different exchange or this or that, you know, like it's earning interest. It can't do that on, you know, in the same way on finance or FDX. You know, none of these other exchanges or platforms have an interest bearing stablecoin, right, especially one that you can spend with and still get paid interest. So when we realized that, we realized we realized we could create something. where the competition is zero. And if we did create it, let's say FlexuSD went much bigger than 10 billion. So let's say FlexuSD went to 50 billion or 100 billion, you know, and became a

really large stable coin used by corporates and multinational corporations to settle transactions and be part of their treasury as well because they're facing inflation. So interest is a great problem to solve that pain point. Well, at that point, not only are we bigger than Binance and no I, but we're really the majority of open interest. So if you think about the open interest in crypto, at one point, Bitmex had 70%. They went from one third. They went from, I mean, at first, nothing. OKX and Hoby were everything.

Then they got one third. Then a few things happened, regulatorily and Bitmex is marketing. And they got to two thirds of the open interest, very impressive position. arguably a monopoly position that was sort of theirs to lose. And we all know what happened. We all know the regulatory reasons they were kind of gone after and had legal problems with the U.S. government. But at the end of the day, it had to take something like that to bring them down because

their position was almost absolute. It was a very powerful position. And I think the interesting thing about the market structure now is there is no one that has that position right now. Binance's open interest market share is only 35, sometimes 40%. No one has anywhere near a monopoly. That's what gets us out of bed every morning. That's what gets us really excited is, you know, we cannot become a monopoly in derivatives by going after traders and trying to do the same things that finance and the other derivatives exchanges are doing. It's impossible because they're doing a great job at it and they're still not succeeding. I have respect. I have respect

for my competitors, you know, I think some of them are doing a great job. And they still haven't managed to do it. So if I just think about it, it's like, well, I don't want to go after that market. I don't want to do that. But I do think with going after the stable coin users, going after the people with dollars in a bank, we can have a much higher chance of getting to majority market share position in open interest. And that's something that can change the world. Because not only are we saying, okay, we're going to go after, we're going to get these traders that are on these other exchanges to switch to be on our exchange, that's zero sum. You know, you're shuffling trading fees from one exchange to another fee exchange and maybe your exchange has some benefits, but who cares, right? But bringing a hundred

billion dollars of extra capital into crypto derivatives, that's exciting to me because I've seen crypto go from sub one hundred million dollar market cap total to two trillion. And there is a drastic lack of leverage in the space. And I think one of the biggest things that can get us from $2 trillion to $20 trillion is more liquidity. And more liquidity will come from more leverage. So if we can get Flexus D to $50 billion, $100 billion, we increase the leverage and the liquidity of the space and then crypto can grow more. That makes a ton of sense. I love the framing around the monopoly. Stable coins have to be one of the most fascinating markets just in the world right now because you have both sides of this market are kind of feeding off each other.

So at one point, you have just the insatiable demand for dollars in the crypto capital markets, but then you have just a staggering amount of new use cases taking off that is driving the demand to just get access to a stable coin, whether that be, you know, international residents that want dollar savings devices, whether that's use cases in defy. What are you seeing driving the majority of the demand right now for FlexUSD? I think it's going to come in multiple stages. Right now, it's people wanting interest. So we kind of see flexuosity as a multi-stage process.

Right now, it's people who are wanting interest. And so far, we've been mostly international. So coinflex.com has only had non-US users, right? So the international users generally have a higher hurdle rate of interest that they're looking to get. And so if interest rates dip down to 6%, 7%, they're like, well, maybe I'll redeem some. But the thing we're very excited about is the second generation, which is the Americans. You know, America has so much capital. It's the home of the dollar.

There's no friction converting between U.S. dollars and flex U.S.D. And so when you open up to that market, it creates access to users that might accept a lower rate of return, you know, because they have so much more money. Their alternatives are so poor. You know, they're not earning interest on their dollars. and they like liquidity. They like having the ability to go straight to their bank immediately. Whereas if you're an international user, you know, if you're in Hong Kong, Australia, UK, whatever, there's always going to be some friction going from stable coins into your bank.

So because of all these benefits, I think the U.S. is the perfect market and there will probably be more users still looking for interest in the U.S. I think the third and ideal market is really people that are looking to use flex U.S. for sort of stable coin use cases, making pain. doing trading, using it for defy. They want to use it instead of USDC and Tether because it's also paying you interest. So you can use all these other stable coins for the same use case. But with flex U.S.D you get interest on top. And that's really the ideal market for us longer term, because those folks are totally agnostic to what interest rate they're getting. Anything

better than zero is a positive. It's like a cherry on top. And right now they are getting zero. You know, they're getting zero from USDC and Tether. And so that's really the way we see kind of flex USD evolving over time and sort of the market dynamics changing over time. It's interesting. I wonder if you'll have a dynamic where some of your competition will be forced into trying to evaluate paying interest. Do you see that as a basis for competition in the future?

I do. And the thing I'm excited about is that none of them run futures exchanges. So, you know, circle, circle's biggest, people are like, well, what's your biggest? user USP over circle or unique selling point or core advantage. You know, I'm like, well, they don't run a futures exchange. And I've built a futures exchange. It's, it's not the easiest thing in the world. There are a number of regulatory complexities.

There are a number of complexities involved in that. And so I think they could offer interest that comes from traditional finance, you know, in which case, they're really going to be paying something like one or two percent. I don't think that's going to be very attractive to folks. I just think that's going to, you know, I, I think they may even have a problem where if they did start offering those kind of treasury bank rates of interest to their customers, their customers will be like, wait a minute, we could be getting,

you know, it might even bring attention to flexus D, but also it cuts off their revenue. Circles revenue is almost entirely from interest income, whereas our revenue, only 20% or so of it comes from flexus de interest, 80% of it comes from trading fees. And the way we model out the growth of FlexuSD as well is, well, FlexuSD is creating more trading fees on the exchange. It's creating more open interest. It's creating more futures trading. So even the way FlexuSD makes money for CoinFlex is really by increasing the volume on the platform

and then that volume results in us making more trading fees. So we could even, you know, we take a cut of the interest right now. We take 10% of the interest that FlexuSD makes. We could even reduce that interest cut to zero if we wanted to make no money on. flexes D. And we would make a ton of money from the futures volume. So it's, I think it's a difficult position they're in. And it's really an economies of scale and complex integration problem. So, you know, we have multiple markets all integrated into each other. And there's economy of scale when you get to having these three markets, you know, borrow land futures and stable coin kind of

tightly integrated into each other. It's a fascinating stack when you think about it that way. I'm curious what you think about the category of algorithmic stable coins. Obviously, we've seen a lot of attempts at this over the years. It's very much in vogue right now. Just broad views on that category. Mostly they've been sort of destined to fail experiments. It's a very tricky thing to create because what you're saying is we can issue a dollar debt and we're going to back it with something that is not correlated to the dollar.

It's not that it's not worth the dollar, but it's not even necessarily correlated to the dollar. So, you know, if there's more demand for the dollar, there might even be less demand for the thing backing the algorithmic stable coin. And that's a tricky situation. You know, that's a difficult situation. It's great when there's lots of creations. But, you know, stable coins don't always have just huge moments of net creations. I mean, I remember, I distinctly remember buying Tether at 92 cents. It was nice getting that fill.

It was also scary because you know that someone else is panicking. And so there are these markets and it's a tricky situation. I think the much easier setup is just backing it with something that's worth a dollar. Every repo position on CoinFlex is always worth a dollar. You know, we're buying Bitcoin and selling futures against it. Bitcoin doubles, you know, still worth a dollar. Models like die, like the collateralized debt pools, that could work. That has worked.

And I think that can be a very sound model. You know, they're doing a margining system. It's mostly pretty solvent. But something like an algorithmic stable coin, that's a much more difficult model, especially to get to large commercial scale. It's also going to be interesting, I guess, to see how the regulators reason with this. So maybe that's a good dovetail into just how you've thought broadly speaking about the regulatory landscape across the world, really, I guess, since you're operating in so many jurisdictions.

But where do we stand now? How have you seen it evolve over time? Yeah. So as I mentioned, you know, I've operated in London and Hong Kong and now Dubai. The best regulator for crypto overall is probably Dubai, especially the best regulator outside of the U.S. The U.S. is kind of its own category, is probably Dubai right now. And there's others that are very forward-thinking, too, especially in the Caribbean. But Dubai is probably one of the most forward-looking forward-thinking regulators.

The U.S., I would say, is probably the most advanced and forward-thinking and friendly when it comes to stablecoin specifically. So the U.S. is obviously very complicated jurisdiction, right? There's probably at least 60 governing bodies that have some degree of regulatory authority over crypto. When you think about every state's money service business, departments, the FinC, the CFTC, SEC, etc. There's a lot of different governing bodies. So it's very complex. And so I wouldn't say that for everything, you know, the U.S. is doing everything completely correct and, you know, bravo to them.

But what I would say is from a stable coin perspective, they could not be savvier. If you look at the Fed's papers and the research papers about stablecoins, you just consistently get this sense that this is a group of people that are basically crypto-native, I would call them. And then there's not that many crypto-natives in the government, but it does seem like the Fed has either hired or grown internally a bunch of very crypto-native people. And they're coming to a viewpoint, which is sort of, well, staple coins are probably not securities, which I think is beneficial for the crypto space, for them not to be classified as securities. And they're probably something that is also beneficial for U.S. government policy when it comes to proliferating the dollar.

So the dollar is like one of the U.S.'s most important or most powerful tools for global policy, foreign policy, and how the U.S. resolves conflict in the world and all sorts of things. And I think there's an awareness, I think there's likely an awareness that in crypto, at least, four years ago, most of crypto trading was actually denominated in CNY. This was not ages ago that it was all taking place, fully denominated in Chinese Yuan. And so that's a realization. And if you think about it as well, if the U.S. The US clamps down on stable coins and makes some sort of pronouncement that they're all,

you know, some sort of problem. Well, crypto can once again easily switch to euro backed stable coin, C&Y back stablecoin, C&H back stable coin, some other type of stable coin. And that would have implications beyond crypto because at this point, I mean, here in Dubai, people are buying houses, they're buying cars, buying all sorts of things using stablecoins. It's universally accepted. If you go to any property company here, it's not do you take. take USC. It's, of course, I'm going to pay in USC, please, and they'll understand.

And in many countries in the world, there are entire multinational corporations that are now moving their payment flows into stable coins. It's just a thing. And so the U.S. government knows this is happening. And I think there's an awareness within the government that this is something that's actually beneficial to the U.S. dollar reserve policy, because these transactions are now not happening in foreign local currencies. Yeah. I think you're spot on. I mean, I think if you had a head of crypto strategy for the United States, their number one

conclusion would be we need to at all costs preserve stable coins and make sure that we are a center for allowing entrepreneurs to launch these things. Because if we don't, to your point, we will entrench China as the number one stable coin issuer in all likelihood. And that will have a huge negative impact on the dollar as a reserve asset. Yeah, I think as a policy matter, whether Bitcoin gets regulated this way or that way or whether exchanges are looser or tighter or better or worse, doesn't matter that much to the U.S. government.

It's not a high priority for them, in my opinion. But you're totally right. Stable coins are the top priority. They should be the top priority. And the U.S. has an incredible leading position. And this is why we're so bullish on the U.S. This is why we've launched CoinFlex in the US. This is why we're making Flexis the accessible in the US because it's such a great country

for stable coins. It's the heart of the dollar. It's the heart of the global banking system. It is where all these things are originating out of. And so it's something that's incredibly exciting for us as a company, but we're also just thinking about crypto as an economy. And it's amazing that one of the biggest economies in the world is embracing core crypto infrastructure in this way.

it's great. It protects crypto. It is something that strengthens crypto and it's extremely bullish and positive for crypto. So that's how we see it. Yeah. So it's going to be an exciting next couple weeks, next couple months by the time this airs you will have launched FlexUSD in the United States. So what are the next few weeks look like for you? Well, the next few weeks is really building out a sales marketing team around FlexUSD in the U.S. So, you know, thinking about who we're going to be focusing on the institutional side, we have kind of a pipeline. built out of institutions and registered investment advisors, you know, these types of family offices, etc., that all have a need and a use case for a FlexUSD. And then really just figuring out what type

of marketing we're going to be doing and how we're going to be building out a community of users, you know, a community of people that are into stable coins. CoinFlex US is also going to have zero fee trading. So it's going to be the, I think, the only US based crypto exchange to have no trading fees. So I think there's, you know, there's a lot we have to offer America. And on the international side, it's a real symbiosis, right? Because the more that CoinFlex grows in the U.S., the more that Flexus D grows in the U.S., the more compelling and competitive, the coinflex.com futures exchange is because the funding rates will be cheaper and cheaper. And the size you can do will be bigger. And so that's something that I think is going to very much grow in tandem with

everything we're building in the U.S. A lot of the exchanges, like, by the market, finance, for example, finance, US and Binance.com, you know, they share a technology stack, but really the growth of one doesn't impact the other very much, maybe moderately. But really, the thing I like about CoinFlex, if you think about most companies, like WhatsApp, for example, WhatsApp US and WhatsApp Brazil might be a different team, but it's the same platform. And for regulatory reasons, we have to make it a different platform. We can't offer futures trading in the US, at least for now. But separate to that, we do want to make as much of the.

you know, our whole philosophy is building connected markets, interconnected markets, and building products that all connect up to each other. And so having FlexUSD as a growth engine that will also drive the international exchange is really important thing for us. And so that's where, you know, we're excited about everything we're doing in the U.S. and we're also excited about how it's going to impact everything we do internationally as well. That's awesome. Mark, well, it's been a blast having you on the podcast talking about these markets. Where can we send people to learn more about coinflex. Yeah, so you can join our telegram. You can follow us on Twitter. It's coinflex.com. I'm at Mark David Lamb.com. I'm also at Mark David Lamb on telegram. And yeah, you can also just go

to coinflex.com or pointflex.com or pointflex.com. Awesome. Mark, well, thanks so much for joining us on pod today. Thanks for having me. Thanks for listening to another episode of On the Brink with Castle Island. To find out more about Castle Island, visit castle island. Visit castle island. Vc. to all of our podcast episodes, please go to On the Brink-Podcast.com or just click on the tab on our website. Thanks for listening.