The Pomp Podcast - Coinbase Exec: Institutions Are Loading Up on Bitcoin | Brett Tejpaul

Episode Date: October 30, 2025

Brett Tejpaul is the Co-CEO of Coinbase Institutional, leading one of the most influential divisions shaping how major firms enter the crypto market. In this conversation, we explore how Coinbase is driving institutional adoption of digital assets — from bitcoin and altcoins to tokenized securities and on-chain assets. Brett shares how the firm is preparing for the next wave of Wall Street entrants, what risks and opportunities lie ahead for Coinbase, and why the digital-asset treasury era is only just beginning.======================Check out my NEW show for daily bite-sized breakdowns of the biggest stories in finance, technology, and politics: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠http://pompdesk.com/⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠======================DeFi Development Corp. (Nasdaq: DFDV) is pioneering a new category in crypto investing with the first Solana-focused Digital Asset Treasury. DFDV offers public market exposure to Solana’s growth, yield, and onchain innovation, offering investors a leveraged way to participate in a trillion-dollar opportunity. Learn more about why Solana and why DFDV at SolanaTo10K.com.======================In this episode, Pomp spotlights easyBitcoin.app—the app that pays you 1% extra on recurring buys, 2% annual bitcoin rewards, and 4.5% APY on USD. Download it now for iOS or Android at https://easybitcoin.onelink.me/F1zP/klc4v1p8 and start earning today. Your capital is at risk. Crypto markets are highly volatile. This content is informational and not financial advice.======================Timestamps: 0:00 – Intro2:02 – Coinbase’s institutional vs retail business5:33 – Institutional demand for bitcoin and altcoins10:20 – Tokenization and institutional adoption15:49 – On-chain vs centralized infrastructure19:44 – Legacy finance adapting to crypto31:53 – Regulation, DC, and the Genius Act37:17 – Are we at the finish line for mainstream adoption?43:39 – Bitcoin as pristine collateral and institutional shift

What's up everyone? This is Anthony Pompliano. Many of you know me as Pomp. You're listening to the Pomp Podcast, which is my effort to find the most interesting people in the world and sit with them for hours while I ask questions in an effort to learn. So it would mean the world to me if you would subscribe to the show on your favorite audio platform, watch episodes on YouTube, and tell your friends and family about the podcast. My goal is to help millions learn from the world's most interesting people. So let's get into today's episode. Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat

any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only. The rest of the world was thinking they had an advantage on the U.S. In one change of administration, all of a sudden, the U.S. has leapfrogged the rest of the world. Now, the rest of the world is going, holy cow, Brett, what's happening there? Tell me what's happening with institutions. Is it true that J.P. Morgan is really doing J.P. Morgan deposits on base? Is that really happening? Yes. Yes, it did really happen. The ripple effect of it internationally has been super pronounced.

what's going on guys today we got a great episode with brett tejpaul he is the co-ceo of the institutional business at coinbase and we dive into all the things that you probably want to hear from coinbase in terms of institutional adoption we talk about what they're thinking around bitcoin around altcoins around tokenized securities on-chain assets what are they going to do when all of the tradify firms start coming into the crypto industry how is he thinking about all of the different market developments both in crypto and out of crypto and then we even talk about things like digital asset treasuries. And we also start talking a little bit as to where are the risks? Where are the opportunities for Coinbase as they move forward? All that and more

in my latest conversation with Brett Tejbal. All right, Brett, I thought a good place to start the conversation. Coinbase is like the king of crypto. You guys are the most well-known brand in definitely in America, probably globally. You also happen to be a publicly traded US company and you sit at the intersection of the crypto world and the traditional financial world. you have clients that are consumer crypto and you have legacy finance firms uh and in a weird way you guys are building an institutional business that should be bigger than the consumer business over time just given the pools of capital that you can go over there how do you guys balance right there's kind of crypto native it's like a whole different ball game than the institutional

world but coinbase seems to be balancing that so how are you guys doing it uh what a warm introduction thank you of course that's a nice nice start to an interview uh we we have built a pretty amazing institutional business it's grown um the client demands have expanded from just you know wanting to buy and store and trade and finance and all those things and now as we look forward with the regulatory backdrop that we now have with the genius act it's really easy to start to think about a world and and put into action um things that will allow the actually the true disruption of the financial landscape and so i think you're teeing up the the topic of tokenization um as being on the horizon and actually not really on the horizon we've

already done you know a few things and so that probably is the thing that begins to build the bridge between the crypto native world and um the traditional finance world in terms of your specific question on how to balance it um really we've been laser focused on getting the first part right before we try and do the other stuff so when i first came to coinbase you know five and a half years ago uh we really only had one thing and that was uh custody i mean it's and by the way when i'm talking i'm talking about the institutional business not the consumer business we were like 99.9 percent of retail company and so we had to break and rebuild and build for the first time the entire um platform that you see today so we couldn't begin to contemplate other things before

we got you know the native crypto thing right so that means um you know qualified custody which you know all about um smart order routing uh building the prime function all sorts of financing products staking products uh making sure the exchanges uh we had the right footprint for both spot and perps you know international came came a little late for us arguably but we're now really expanding our reach there so it was only at the point where we had and nothing's ever complete but like a very fulsome set of products where institutions were like okay i can do all the things i want to do and actually um you know thinking about it and this is feedback direct feedback from clients they're like hey you've built something that feels like what i do with

stocks or bonds right it's a similar experience in terms of how i deal how i trade and that's the moment where we go okay like what else can we do what is it you want to do and that's why now it's more like client demand, is saying, well, this is like better, faster, quicker, more secure. Why don't we think about doing other things? And we've seen announcements from other firms about tokenizing stocks and tokenizing credit funds, which we've already done.

And I'm very excited about that future. So it's really, the way Coinbase works is we're laser focused on delivering products and having a steady stream. We can't do all things to all people. So now it is the appropriate time to think about what's next. So let's go maybe sector by sector.

and you just kind of tell me what the institutions are doing um bitcoin i would think a lot of them start there but there's etfs that are available what are you seeing in terms of the institutional demand for bitcoin uh going spot you know versus maybe some of the other tools they could use yeah bitcoin's a gateway uh i mean it's consistent with your view um once we we have now um let's say five years of uh client footprints and and patterns and it's uh fair to say that Bitcoin is absolutely a gateway. Once you do that, you're likely to own ETH and then progressively other things. More importantly for us, you're likely to elect to do more products with Coinbase. So buy, source, sell, finance, do different things. And so if you build a product

platform, the idea is that a singular client will choose to consume multiple products. um and so what we've seen there is an expansion of their activities um into owning more things but then also recently in the past couple years a desire for um you know uh non-us clients to be able to trade in non-us uh places like our perp index and index and so and and perps and so we're seeing a very steady expansion of clients from overseas um beginning to trade on on on index The Deribit acquisition was huge for us. So that's a great demonstration of the progressive activity that institutions do. So first spot, then sort of normal futures and financings in there as well, and now options.

And so options was probably the last big piece of the puzzle that we needed to solve for. And Deribit provided an accelerated path to the go-to-market. When you get into maybe the altcoin space outside of Bitcoin, so still crypto assets, as people would think about it, maybe like the top 50 or top 100 on a coin market cap, what is the institutional demand for those compared to maybe a Bitcoin? Well, as an overall statement, it waxes and wanes. Where it's steady is in the people that have been early. so the whole venture community uh the private sort of high net worth you know communities consistent demand uh the the prosumer what we call the prosumers are they you know the active traders that are trading on our our in texas our acronym for our bermudian perp exchange and so um we see

a lot of activity there i would say for the more tradfi hedge funds that dip their toe in the water trade a little bit of bitcoin maybe a little bit of eth maybe more in the context of an inflation play a store of value they've been at times going out a little further you know thinking about um you know avalanche solana you know other tokens they don't extend too too far so i would say when they five maybe top ten top five you know top ten we've been asked to for you we have the coin 50. So the coin 50 is, as it sounds, a market-weighted index. And we've seen demand for that. So people want, particularly those that are late. So if you're an institution that wasn't already long Bitcoin, you're going to this. I can't tell you how many hedge fund guys would

say, like, I'm a great trader in Tradify, but I miss Bitcoin. I'm never going to miss the next thing. Getting long the coin 50 through our asset management business is a great way to do that. So I would say that intersection of TradFi guys going, you know, extending out with the venture guys that are always in it is kind of what we see. And then the X factor, if you like, are the systematic funds. The systematic funds are coming and they are coming in size, but they really need to trade 40 things, not two things, not 10 things. And they need consistent borrow.

So what we've built now with our prime offering allows them the ability to have constantly on demand a borrow, the ability to go long and short. They can do that on perfect exchanges. They can do it in spot. And so I'm hoping that and betting that that community, that systematic trading community comes in in size and we get more pronounced activity and tokens. Right now, what's filling the void, I know it's a long answer, but what I like about the DATs, you haven't gone there yet, but I think you're going to. The DATs are, I think, a new path, an easy path, like you mentioned, ETFs. But it's a new way for capital to come into tokens that aren't Bitcoin and ETH. And so that's an interesting play, too.

Let's talk about tokenized securities. We've seen lots of announcements from companies. It feels to me like we're still pretty early in these things being tokenized themselves, just like the asset actually existing. And then the market seemed pretty thin in terms of liquidity, but it's been growing. And I think the belief is that as larger players come in and some of the market makers and stuff, you'll get that liquidity. Are you seeing a lot of demand for that right now from the institutions?

You know, it's kind of crazy. We have, we're in this phase now to setting the context of why it's kind of crazy. So the context is that the Genius Act passed. passed and so now stable coins are part of the framework so that has been a giant catalyst it's not really the price action on bitcoin that that got people to reconsider the marketplace it was actually passing the genius act and what's what's to come on market structure so now that that's like part of the mainstream economy everyone's going okay like hmm this crypto thing is really going to disrupt financial services how and if you're a behemoth like um as an example not a

specific one, but JP Morgan, Bank of America, Citibank, Morgan Stanley, you're sitting there and you're saying, hey, team, how is this going to disrupt our business? And they say, well, if they apply the technology, it's possible that, or maybe even probable that, we can have tokenized stocks and different instruments. And so all of a sudden, everyone's gone, oh, well, that's kind of cool. Like, can I tokenize my hedge fund LP? Can you tokenize my credit fund? And we're doing stuff with Apollo. Of course. And can we hit new distribution paths? So I'd say that demand is mostly coming from asset managers that want to find new distribution paths. So if you think about like issuers and investors, it's the issuer side who's really

actively looking for new investors. And this is going hand in hand with the major push into retail investors and high net worth online and what I call an independent investor. That's really what's driving a lot of this is they see tokenization as an avenue where they don't have to go through the stockbrokers or wirehouses. They can go this other angle. Well, I'm thinking there's multiple paths here. So you can tokenize things and still go through your brokers. And so my theory is water will flow where it flows the easiest. And so tokenizing things, so a couple of things come to mind. So VanEck did a tokenization of a treasury fund. I think they're kind of ahead of the game. I think Avalanche did something with CLOs,

which is at the more complex end of things. And that's kind of interesting. That's worth dwelling on. So why would you tokenize a CLO fund? I mean, CLOs are kind of complicated. I used to be ahead of structuring of CLOs, and so I know it particularly well. But that's a good demonstration of something on the more exotic and complex things, rather than a single stock. So that is a good example, the Avalanche CLO, of what structures are called repackaging. So making it available to those people in a form, in a marketing way that wasn't previously available. So it's possible, and I think probable, that some of those tokenized assets may find its way to new buyers.

Maybe it's a new demographic of younger people that are already involved in crypto that are like, hey, what's that? It sounds interesting. So I think tokenization is a super broad topic. It can apply to the most complex, to the most vanilla. I think it will be transformational for having issuers find new investors. And the list is eclectic. So for us, it's kind of difficult to say, like, who is it that we should cater to?

You know, I can give you a list of public announcements that are out, but like Apollo, right? And, you know, Mark's out there talking about tokenization markets. Larry Fink's talking about tokenization of all things. And those serve as, you know, amazing examples. You know, Avalanche has been out there for a long time talking about, you know, using their chain to tokenize assets. So thematically, all this stuff is coming together. It's not exactly clear to me what's going to scale first, but I feel like the issuer

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and why dfdv is the best way to capitalize on it visit dfdv.com slash pomp that's dfdv.com slash bomb now um there's also this belief that uh on-chain and kind of the decentralized infrastructure versus centralized infrastructure so we talked about like there's different types of assets that people want exposure to or maybe even be the issuer of um but the way that they interface here right so they can go and buy something on your centralized exchange uh but also now it seems like quimbus is adding a lot of decentralized you know kind of on-chain type activity is there demand from the institutions for that type of stuff yet or is that kind of like 201, 301 level stuff that they're not yet there? I think it's 301, you know, level stuff

where I think the institutions have to begin to say, um, it's the first time really that they've had, I would say not the promise of something, but the threat of something. And it's the threat assessment to say, you know, what can happen to our business? So if you're, I don't know if your audience is any um uh TradFi people out there but if if there are TradFi people over here okay so I can say you know in boardrooms right now they're saying hey the last great transformation uh of markets was uh like electronic trading right and and that like changed the landscape of of all things um that is the sort of that's that's the context with which people are saying this is the great thing that's going to change the financial landscape. So that threat assessment is driving

firms to say, huh, what's going to happen to our equities business if this actually comes to scale? And so it's the threat assessment that's sort of drawing both fixed income, vanilla, complex, all the financial instruments are everyone that's responsible for a product is now being forced to think through how stable coins as collateral management that goes across all the asset classes are going to change uh the way they flow and so i think there's a real risk of people saying just like they they did last time uh if you think about you know some of my former bosses and managers by the way like when i when i said i was going to go to coinbase to try this thing and i was really interested um nine out of ten of them like begged me not to go but that because

you're so good they didn't want to lose you or because they thought you were so crazy and maybe not intelligent for going um it was definitely the former former yeah for sure for sure but now that so just imagine the profile of that person though who's now um you know rewind and it's like the last bull market and you know you've got coinbase and you've got others and you had you know i'll bring up ftx i had a former boss that said brett you know this stuff just won't go away and i'm too old to learn it and after ftx happened he felt validated that he ignored it now he's not yet retired uh he will be soon but he's gonna do the same thing again now and he's gonna lose and so uh it's time for him to retire move on and make way because it's the kodak moment for

financial services right if they don't actually embrace the technology now you will be left behind And so I spent a lot of time the last five years saying, hey, this is coming. Now I'm overwhelmed with interest. I spent a lot of time with the people that are dissenters. Right now, I just don't have the capacity to continue the debate. There's enough out there. There's enough evidence. There's enough big names.

I can go through them and reference them. But once you see your client base activating, and that's what's happening, the client base is activating and the banks are behind. so when you see blackrock doing you know progressively not just one thing it wasn't a passing interest and you know you've got larry and senior leaders in the firm talking about the tokenization of all things like i think you're really supposed to pay attention aren't you like would you ignore it i keep saying that um when do we call blackrock a bitcoin company right or like a crypto company yeah and if you come back to this idea of okay you got one

product it's the most profitable got it but i think that there is going to be a tipping point where likely a more than 50 of their revenue is going to come from crypto related products whether that's tokenized securities you know whether it's bitcoin eth solana whatever like there will be this like flippening of revenue and at that point it is very i think in a different way but very similar to what coinbase is doing right like the blackrock name or name you know fidelity van eck whoever uh very trusted very well established in the kind of traditional world but they're almost like recreating their business in a crypto and right now it's you know more centralized in kind of the traditional wrappers but eventually it'll be on chain in you know various ways uh apollo's

doing some of this whatever you guys seem to be the trusted you know kind of established brand coming from the crypto native side but you are kind of ripping out some of the centralized stuff putting the on-chain stuff in there on the consumer side i'm assuming over time as things just generally move on chain you know i mean ice nasdaq these guys are all saying that they're going to put stuff on chain too uh naturally all businesses are going to kind of flow that way and having that established brand actually may be more valuable than uh than people realize um great and super insightful anthony as always uh this is like the moment where i have to um be nice to me because i'm interviewing you so you know it's it's it's recognition of what brian and

And Max Bransberg built, I know he was talking to you yesterday, but Max has been on his side. He's been the leading tip of the spear. And it's really his clientele, his clients, his consumers that have gone bravely into DeFi. they've they've they've created demand and on-chain they want on-chain experiences it's a younger demographic it's important and um for for the institutions to watch the on-chain economy begin to form and the way it's always been in crypto is it's first retail and then institutions and so this is where it's like super important for the for my institutional business uh to be housed within Coinbase. This comes back to your brand point. And what I've seen so far is the on-chain economy is first starting with retail. But that's led to the first movers and institutions going, oh, I think we want to tap into that consumer. And so that's where I see a lot of

these early tokenization projects on the institutional side. I don't think are designed to be you know you know ibid may be the first trillion dollar etf that has a combination of retail and institutional you think you can get there i think you can actually yeah they're at 100 billion now they definitely touch that um yeah or they're around 100 billion so 10x from here how much of that do you think is price appreciation versus like continued inflows uh you know it's hard i know i'm preaching the choir on this one but you know supply to band and uh wow on the demand side so um i i won't give price forecasts but i think it's possible that maybe 50 of that may may maybe wind up uh being driven by by price but back to you know

the on-chain economy one of the things that brian was saying is you know the crypto natives really want to see on-chain and they really have a you know decentralized um you know preference but a lot of things on the institutional side need to begin uh with centralized and and i think part of the success of base um is really because it's housed within coinbase and we're having i would say surprisingly we're having um institutions say actually the first footprint we're going to have in the on-chain economy is with base and let's privately you know begin to put some things in place. And so that's super exciting. When you think of these institutions, you mentioned earlier, the digital asset treasury companies as another way for the clients to get

exposure. I know you guys are doing a bunch of stuff with these companies as well. How are you interacting with them, servicing them? What are you seeing in that market? Gosh, I think the last time I made a count, and it could be dated now, but I think I counted up 260 digital asset treasuries and that includes corporates that own some you know bitcoin on balance sheet but um there will probably be a consolidation over time and still you know some some deaths that will scale i'd say the role that they're playing is really important because it's a new it's another bridge into the crypto economy so making it easy for people to you know buy a stock and so a couple things come to mind um you know they're i mean the first one that

pops into my mind happens to be you know avalanche and avax and i think they have an interesting strategy because um they were early on the institutional side uh with their subnets and sort of uh different projects that they they took on i think i already mentioned um you know the clo one they've i think they've got one with the dmv they've got you know one toyota and some other stuff which is which is pretty cool but the dat which will on the token also intends on i think they call themselves like the berkshire hathaway or crypto or something or or that's their ambitious you know goal um but uh there i think they they have something different which they want to buy ecosystem partners um not just own the token themselves by the way in this moment

i need to disclose that uh i am actually on the advisory board in a personal capacity and so um the you know my comments here are really in that context but i've learned that they are intend to buy and and support ecosystem partners that you know to to kick to kick start you know activity there and it's the idea that they want to have operating businesses that have cash flow and stuff like that because i think that's the one thing i mean we just saw strategy get their credit rating and one of the things they got dinged for was the fact that they're not profitable right um many of the other companies that have started to uh you know enter into this treasury world they actually are either selling off their like core operating businesses and and trying to become much more like

pure plays but it does feel like there's a whole new wave i know of some that have not yet been gone public or they're kind of thinking about it these are you know one case they're companies that have nothing to do with technology right they're like kind of like infrastructure or manufacturing type businesses that are profitable that you've got you know essentially a bitcoin or you know some sort of crypto fan that runs those businesses they've been putting stuff on their balance sheet And now they're saying to themselves, well, maybe I should be a public company. I've got cash flow and I've got the asset. It sounds like this Avalanche one is trying to do something similar, but just like go and acquire it, almost like a roll up.

Yeah, I don't want to speak too much about that one. But going back, I mean, as you say, those operating companies, I can think of another debt that has a mining company. I can think of another debt, like Strategy started with their software business and then said, we're going to buy a bunch of Bitcoin. But we have enough operating income to sustain leverage and price downdrafts. They've now grown so large that the operating company looks small in relation to their holdings. That's a new set of problems as a function of their success. But a lot of the deaths are just, hey, let's find an easy path for new money to enter the place to own tokens. And some are Bitcoin, some are intent on modeling themselves after what they are betting that one day if there's an SBR, a strategic Bitcoin reserve or sovereign holdings, they'll mirror those holdings.

And so there's some pretty advanced strategies that are out there. But the thing I like most about it is I think the last time if there were 260 companies, I think there was something like 15 billion of new capital that's come in into the marketplace. And we welcome that. And if there's some sort of flow of that capital that gets to support emerging on-chain businesses and the crypto economy, mining and other things, I'm all for it. Now, what are the areas you see as maybe where you think the institutions are not yet paying attention to, but they should? We talked about on-chain. Are there other areas where you guys are either making bets from a product standpoint or you're like, man, I'm pretty surprised that we're not seeing demand in X or Y area? Well, I just realized I didn't totally answer the question you asked in terms of what Coinbase is doing with the debt. So let me just finish that off.

So what we're doing is what you'd suspect, which is we're providing custody for sure, providing trade execution, financing. A lot of them actually are, it's a small bunch of people that intend on having some sophisticated treasury management. And so we've got our asset manager, Coinbase Asset Management, CBAM, who has those skills. So if you're doing like call overriding or doing Bitcoin yield, they just launched a Bitcoin yield product. So CBAM is actually positioning itself as an asset manager to act on behalf of those treasury companies, like outsourced asset management. Coming back to the current question in terms of what else we're not seeing, if I go back to the big picture on tokenization and what we're seeing from issuers, what we're seeing

is stock markets are at all-time highs. uh people are feeling i i'm not gonna uh make a projection where we go next with the economy that's that's what you do i heard 8 000 uh i thought i didn't know he's 8 000 as a b a million of bitcoin um um so so we're seeing those issuers want wanting to find you know active new ways to find investors right so i think issuers are how they're like how do we keep growing and for them to keep growing they need to find new ways to attract capital and if they've expired all the traditional like distribution paths which they have then the next frontier is the on-chain economy so i haven't seen anyone so far say ooh look what's happening there like

we need to our operating business to instantly go there but anthony i do remember you know when i first joined coinbase and i was kind of learning and talking about what smart contracts can do and i had uh ceos and cios of insurance companies come immediately which i know for 20 years saying all right we're ready i had uh i don't want to say the names of the the some of the world's largest retailers um and tech companies you know remember the all the stuff with meta and what they wanted to do and so they came all all at once and said hey we're ready to do this on chain thing like how does it work we weren't ready uh we weren't ready at the time to to fulfill their needs i think we're now ready so we're we're getting there so i think i want to see myself more of the use

cases i think our consumer business will lead the way uh i think we've already seen massive um growth of uh d5 exchanges um and that continues to grow thematically brian's talked about base eventually becoming more decentralized so there's a lot there anthony to unpack i i'm Let's stop there. Today's episode is brought to you by EasyBitcoin.app. They offer a simple, rewarding Bitcoin investment experience. With EasyBitcoin, every recurring buy automatically earns you 1% extra in Bitcoin. And the sats don't stop there.

Hold your stack in the app and you'll collect a 2% annual reward plus 4.5% APY on any U.S. dollars you park in the USD interest account. You can even opt in to have your interest auto-converted to Bitcoin. It's a simple, set-it-and-forget-it way to grow your Bitcoin. easy bitcoin is live right now on ios and android hit pause click the link in the description download the app and start earning while your bitcoin stash grows your capital is at risk crypto markets are highly volatile and this content is informational and not financial advice dc is now uh very important uh it seems like every other week uh there's some event going on there people are flying from all over the country um genius i think is a good first step

and people feel like, okay, we've got some clarity and certainty here. We now know what the rules are. Let's go execute. There's the Clarity Act. There's also a number of other things that people are considering. How are you guys building in a space where you know that the regulation is going to continue to clear up, right? It's always one of these things where I think the reason why Coinbase has such a good brand is kind of my view of it is you guys have always said, look, we're going to operate with extreme caution. And even at times where I think you guys were operating with caution. You still felt like, hey, we're running into the regulatory apparatus and there's some maybe irrational views that are coming to us. And we're the good guys.

We're the guys who are trying to be pretty cautious here. Now that we're getting that clarity, it does feel like it's a tailwind, but there's still some open questions. What does clarity look like? What does some of these other legislative pieces? So how do you kind of incorporate the dc activity in what you guys are doing well i i gotta say it is the number one catalyst uh for my business for sure and so uh a number of things pop into my head i i love the expression even if people don't you can't put the toothpaste back in the tube and that's what just happened it's true you can't do it you cannot do it right it's a mess and i actually tried that one time in a hotel bathroom and yeah it doesn't work it's true so gotta check you know if you're gonna

use the words you gotta check it make sure yeah gotta check it uh so so that's happened right and don't pick up pennies in front of a steamroller and you gotta check it yeah see the trad fight expressions are coming out i like it i like it uh so you can't we're not going backwards and and that's an important point and it's you know stable coins aren't a bipartisan thing it's not it doesn't favor you know democrats or republicans and so now that that's happened And I'm actually kind of relaxed about what happens next, to be honest. I mean, there's definitely things that are more advantageous for the current model that we have. But we've built everything in preparation of having variable outcomes.

And so what I mean by that is when we built the business, we separately capitalized. We have information barriers. We have everything. So everything that we've built can be tied together, but it also actually has to stand on its own. That's the concept, right? So I didn't build one trading desk that we've never traded proprietorially. So different to pretty much every other shop out there, we don't front run. We can't.

We literally cannot do it. Other places still do that and somehow get away with it. But I could name a few, but that wouldn't be nice. So all the things that we've built, we've built in anticipation of living in a world, which is the world that I actually came from. where i've got like a patchwork quilt of regulators there it's uneven you know regulatory environment you have to be compliant in all the places that you operate it's not the same you want to have a a client experience that extends across multiple geographies you want

to financing across all those things you want to have margin but you know you know this country is a little bit more disadvantageous for capital this one's awesome this one has netting and so So what happens next, although D.C. is going to be a favorable outcome, I'm pretty relaxed, meaning we can cope with and adapt to whatever happens. The other thing that's happened in the context of D.C. is the U.S. was lagging the rest of the world for a long time, like years. And so we were pushing internationally. We were thinking about a world where actually innovation had to go abroad, was going abroad. We've got, I've got people in, you know, Dubai. We bought a business, you know, Deribit.

There's people in Amsterdam and Dubai. And the rest of the world was thinking they had an advantage on the U.S. In one change of administration, all of a sudden, the U.S. has leapfrogged the rest of the world. Now, the rest of the world is going, holy cow, Brett, what's happening there? Tell me. What's happening with institutions? Is it true that J.P. Morgan is really doing J.P. Morgan deposits on base? Is that really happening?

Yes. Yes, it did really happen. And yes, the big banks are finally coming, and that's happening. So DC, for me, is the single largest catalyst. it's it's triggered everyone domestically and actually it's had the ripple effect of it internationally has been super pronounced and so now rest of the world is like oh my gosh are we going to lose our advantage are we gonna are people going to stop building here i think my answer to them is um i think everyone's really happy in both places and we continue to build

coinbase needs to build this brand internationally i still want to invest you know internationally and grow grow our footprint there so no change for us but dc is the single biggest catalyst i love the fact anthony that you and i are talking about all sorts of things like really really big things in dc you know tokenizing some of the world's largest markets as an example you watch football um you know sometimes they're like running for a touchdown and they celebrate a little too early and they drop the ball and then it's like a fumble and usually a safety and it's That's the whole thing. They get mocked on the internet.

Are we at a point as an industry where we're close? We're like on the five yard line and we could start celebrating because we feel like we're winning or are we actually in the end zone and you feel like the institutions, everyone is embracing this. And the reason I ask that question is

I look at it as three things. There's technology, there's adoption, and there's regulation. And the technology for all intents and purposes seems to work both centralized and on-chain. It does feel like every day you're getting new announcements, you know whether it's the coinbase city stuff or it's a certain client or whatever but like the

adoption seems to be there and now regulation like you know you're even you're saying look they're around the edges there's some optimizations and you know advantage uh advantageous stuff but for the most part like the regulations are putting us in a pretty good spot so do we get into the end zone or are we still at risk of like dropping the ball early and turning you know a great thing into a fumble okay so i was a philosophy major okay i was a finance major and i was a philosophy major I'm going to give you a weird answer. Um, here's my weird answer. Um, both those things are true. Yes. And so what I mean, what I mean by that is, um, we're in such an advantageous backdrop where for the first time ever in my pretty long career at this point, we have regulators saying,

listen, we've opened the door, show us through action that you're, you can, you can do this thing. And you can do it in the right way. You can make an on-chain economy work. You can make DeFi work and sensible things will happen. We're also in the end zone because holy cow, Genius Act has happened. That was like the thing that happened quicker than we thought. However, and here's my but, if some version of what happened last time happens again, we're going to ruin it. And I feel like as an industry that self-regulation and all the things that happen, I've seen bits and pieces of hubris in this market. I've seen still evidence of some pump and dump on illiquid stuff. There are signs of things that I don't like and I don't think will

be good for us. And so I think as an industry, if we want to push the limits, we want to make sure that regulation lands in the right place. But if we have a bad actor at scale, and we had a few of those, and that emerges again, and it will, I just hope it's a contained place. I think what's happened, the big trend has been bad actors should leave and go find some other asset class and let's clean this thing up and let's have proper regulation and the barrier to entry is so high that only the good you know the good guys can can operate and i hope that's what happens but it's not what's going to happen but we'll have it we'll we'll unfortunately we'll have a few people and i just hope that we can um not not have to pronounce an impact i do think

that there's a world where uh bitcoin and cryptocurrencies are now attractive to these large pools of capital because the return has come down like when it goes up 500 700 900 in a year and then it ends up dropping 85 they actually don't like that like that that's bad if it can go up 75 a year and maybe there's you know 20 30 drawdowns but they're pretty uh kind of fast to recover that becomes a lot more interesting and so in a weird way the returns coming down actually became an attractive thing for a large pool of capital i also think that returns coming down and regulation and stability and maturation all these things we're talking about are disincentives for nefarious bad actors like it's like already there's like too many cops in the market right

you actually like it when there's no rules and i always tell the story in i think it was 2016 or 2017 like right when the ico uh like boom started i remember somebody was like hey you want to invest in this and they sent it to me and it was literally like a one page google doc cocktail napkin and even better and then uh it had a contract address and then it had a spreadsheet like a you know google sheet and people were just putting in their name their contract uh their wallet address and what they were investing and that was like that's how they were collecting funds yeah i know a guy and and uh to be honest at first you're like well how much is it going to go up and they're like wait a minute what am i doing like this is insane yeah right and so uh when

that's the world obviously there's people doing all kinds of crazy stuff now when the announcements and headlines are not you know token goes up 20x in a day it's you know blackrock launches etf or coinbase and city partner or whatever in a weird way the like bad actors are not so interested in that world right i i like that i think it's it's actually playing out i mean if you look at what happened with Bitcoin, was it two weeks ago, when we had like a little bit of a flash crash. The fact that we haven't dipped below 100, haven't come close to it, I think is a sign of there being more, a steadier base of longer term investors. And so a declining volatility with an appreciating asset, you're right, it kind of fits the profile more for institutional

capital. We're not there yet. It's not boring. I mean, we still have a pretty big ball, uh but i think you're still is up 70 or whatever over the last year yeah right bitcoin amazing um but but yeah we still have those we still have as you go out the tail there's there is still um a lot of that um illiquidity and pops and some of that stuff so i i do think your thesis is right where the more this is out in the the more people invested the more capital at risk the more attention you know from the regulatory community uh eventually it'll get on bank balance sheets um it'll be financed um do you think the banks are going to hold bitcoin on their balance sheet eventually yeah eventually i mean i think the ball ball capital rules um are still um

going to prevent that from happening but eventually yeah too well i mean why not you know you know in the end if you have an asset whether physical or financial that demonstrates the characteristics we just talked about why wouldn't you think about you know lending against it i mean the answer now is because it's prohibitive in terms of you know bank capital yeah um but that one is better collateral it is better collateral right i you know i i've i told story one time before uh there's a gentleman who uh uh very well respected lawyer and um he uh was not very much into the crypto bitcoin stuff but he helped me with a couple of things and um he started reading the letter i write every day and so back in like 2020 2021 i wrote a piece and

i was like bitcoin is pristine collateral and i walked through the whole thing it's liquid the you know the person lending against it holds the asset you can all this stuff right and he responded back and he was like basically this is insane please just stop saying this like what are you talking about pristine collateral you sound like a crazy person and i remember saying to myself like this guy's really smart very well respected yep and he just had in his head like pristine collateral equals like treasury type stuff right treasuries yep and he couldn't yet think through this idea of like maybe something was better and so um there's been a times in my journey of crypto just like no every time you hear that like that's the opportunity

because if everyone already saw it the banks would be there that you know there would almost be no market to like arbitrage and be early and kind of build a business um so maybe that's like a really bullish thing for coinbase it's massively bullish i mean the thing is like this little chat is like uh if we were talking about 301 stuff this is like 801 stuff so so understanding the power of gc collateral i think you and i understand that in the context of is those balance sheets portfolio risk and accumulation so like what happened to the uk the the uk remember like with the the pension funds had to scramble to you know rate raise pounds and so this is amazing collateral right for that it has all the characteristics that you have you know in

terms of the pristine collateral um we don't have to go into the details of it it will get there um and so for for those remember that there's the converted and those that aren't converted those that aren't converted have already been given the remember the homework assignment that everyone has to do right now the homework assignment is how is your business going to get disrupted by crypto there are war rooms like when trump was elected there were war rooms i i you know the people i know the people they were all in them and their assignment was come back and tell us and i think you know they were forced to do the the homework assignment you know even if you don't care about this stuff and so so who runs collateral and treasury for these places it's

the most senior person in the place right like this is the liquidity of the big bank right that person at every place had to conclude that this has the potential of actually completely disrupting our business that is true and that's why you've seen you know some headlines from swift or this or that or you know money you know western union says stable coins are not a threat they're an opportunity yeah okay well let's stop 50 in five years yeah let's just take a snapshot of that one i can add that i have a little i have a little clipboard on my desk of paul krugman internet is no more valuable than a fax machine listen on the point you were making before about the story about the guy i wonder if i know the same guy so there's another guy that that that wrote

a you know bitcoin is whatever secretly years later and this is like a tribute to you said that guy was super smart right the smartest people i know that were the biggest dissenters have actually gone long they flipped and they've gone long and they have maybe haven't advertised it you know they may not have you know written a love letter to bitcoin um but they've converted they will they will they will that maybe the children if bitcoin goes up yeah their children will my favorite uh i i should always caveat this i think jamie diamond's incredibly smart best banker generation in the whole thing right uh but i did find it quite uh quite entertaining at one point um a couple years ago he was like uh you know if i catch anyone trading this i'm

gonna fire them or whatever and then two or three years after that he then told the story he told the story he's on stage and he's like so i said that and then i got a phone call from my daughter and uh she's like hey dad i own some you're fired and he well like but but like i think that's why i like i i like really like him right is that uh he had the intellectual like kind of transparency and honesty to be like all of a sudden he realized like wait a minute there's like a demographic different there's something there yeah and so like i don't think my daughter's dumb right but like she owns the like and i do think and i've said before almost every great especially on the macro investor side i've met a bunch of these folks and almost every single one of them i met

because their son or daughter reached out to me and was like i'm trying to tell my dad about this he won't listen i think he'll listen to you can i like set up a zoom and i could like go through the list of all these folks and in the beginning you know it's like all right let me hear you know it's just like they're not interested whatsoever they're doing it basically because their kid made them and now like you see them on tv and you're like wait a minute what the hell is going on here right two years later and they're like they're like all in right they're like oh i think this you know we're going to do this we're going to tokenize our funds whatever and i do think that that's why they're so great though is the like intellectual honesty of okay i changed my mind

And I'm not ashamed of that. I'm going to go and I'm going to embrace it. And then they end up being a Coinbase customer. I mean, there's no better thing. There's no more rewarding moment for me that when a dissenter turns and becomes a believer and not just a believer, they're hardcore, they're prophets.

Yeah. You know, I don't even do that stuff. I never do that stuff. And it's amazing. I consider myself a bright disciple. I'm a pop disciple. I've been following you for years and years. all right where can we send people to find you on the internet or find more about coinbase

institutional uh go to a website i mean it's amazing i aspire to build a business that's just yeah you want to know about my business just go to my website go to my website yeah it's coinbase.com yeah it's the best all right thank you we'll do it again in the future all right thank you