The Wolf Of All Streets - Bitcoin's Crossroad: DeFi Bleeds While Stablecoins Win

Episode Date: April 30, 2026

Bitcoin holds steady while DeFi scrambles through a $300 million bailout after the Kelp DAO hack raising real questions about how decentralized DeFi actually is. Meanwhile, stablecoins are making moves. Meta is paying creators in USDC, Tether proposed a mega merger to build the biggest public Bitcoin company, and the Treasury seized nearly $500M in Iranian crypto. The Fed is expected to hold rates in Powell's likely final meeting, and Wall Street just split on whether quantum computing is coming for Bitcoin's encryption. We break it all down live. Learn more about your ad choices. Visit megaphone.fm/adchoices

Bitcoin is at a crossroads. Defy bleeds while stable coins win. So we obviously are going to unpack Defy United and all of the contagion from the Kelp Dalhack. Also talk about some massive stories in stable coins and, of course, the merger that Tether is proposing between 21 and friends. And we got pal who just ain't leaving. I can't think of a better guest to have today to help me try to attempt to maybe unpack all of this than my friend Austin Campbell. It's going to be a great one today. Let's go.

Let's go. Good morning, everybody, and welcome to the Straits of Hormuz. I didn't know this would be back there. You'll notice this is not at all AI generated because you can see the natural, windy flow of the plants that are going in opposing directions. Are there butterflies? There's a lot going on, but it would have looked real if I didn't tell you that. So it's fine.

But this is what the Straits of Hormuz looked like. Have you ever been to the Straits of Hormuz on vacation, Austin? I was going to say, I have not. I, what is the best way to say this? I get dragged all over the world purely for work reasons at this point. So I live in the inside of office buildings everywhere. Okay, but at least you get on a plane sometimes. So listen, let's start with that.

I think the story of the day, maybe that's not necessarily a crypto story, but we got to talk about it, right? Jerome Powell, his term is fed, chair is ending. Remain on the board until DOJ probe is over. So there's a lot to sort of unpack here. But I just want to show you a live click, really quick of this. We got the footage. I'm not leaving.

I'm not leaving. I'm not fucking leaving. He literally pulled back. It was like, it's your turn to go. No Fed governor, no Fred Jeremy has ever stayed on since 1948. And he was like, it's too politically motivated. Oh, wait, one more clip. We got to play one more clip, right?

He was asked, he said he'd keep a low profile. This is what he said. You mentioned that staying on as a governor, you intend to keep a low profile. I'm just wondering if you could give us a little more detail on what that looks like and how you can. How is a comedian now? This is funny.

It's his last press conference, his chair. He can kind of do whatever he wants. I'm glad he wasn't up there with a beer. This might be our last press conference ever. I mean, it's actually possible in his particular case. Fed governors do tend to keep a significantly lower profile. And, you know, Scott, I'm sure you have your own thoughts, but I'm certain part of what's motivating this somewhat unprecedented move is the response to political pressure. So we'll see how much he hues to previous precedent around interviews.

Yeah, this is really interesting, though, because he says it's because of the probe, which effectively was sort of dropped already, I think. But it seems like he just, in his words, wants to maintain. the Fed's independence and doesn't think that will happen if basically Trump gets to appoint another seat. But this also does have major implication. If he sticks around, we know that he's kind of had a hawkish tilt. So it may be, I think markets reacted very strongly, actually, to the downside when they saw this because they thought, well, if we're not going to get the stock puppet one and sock puppet two, whoever that would be, can Trump actually, you know, get what he wants out of this Fed? Will we see interest rate cuts? What we see easing liquidity?

I mean, a little bit like all the tankers trying to get through the straight of Hormuz. You're in pretty dicey waters here if you want rate cuts now. If you look at just what's happening with these decisions, so Powell's going to stay on. He strongly values the independence of the Fed. And I'll remind everybody, ignoring all the political like drama, he was very well regarded within the Federal Reserve, even before he became chair, much less after. So I think other people will take some cues from him. And two, we've seen what's happening with energy prices.

We've seen what's happening with market uncertainty. This is not usually an environment into which the Fed would cut. You can't cut. Right? They can cut. No, I feel like if you're looking at potential encroaching like energy price rises and you think that's going to have a shockwave effect into the rest of the market, you're not going to be cutting interest rates. Now, you can't hike your way out of a supply shift. shock. Right. Reminder to everybody, oil is a physical good. The reason the straight is so important

is that stuff needs to get from point A to point B and interest rates will not change the physical process, but you also don't want to be cutting into a supply shock because that will just unleash chaos. So they're kind of stuck. It also feels like the conclusion of this war may be no war, no deal. I mean, if you look at what the current strategic, like, frame is for the United States, it's we're kind of done punching you kinetically, but we're going to keep this blockade going because we think your economy is collapsing, like our Treasury Secretary has been speaking about that. And then we're just going to sit on our hands and wait and see what happens. Yeah, this is like surrounding the castle in medieval times.

and starving out the people inside. Like we're not gonna lose troops attacking the walls, but eventually you guys are gonna come out. I mean, I don't know if you saw this story, but sent as USC's nearly 500 million in Iranian crypto as Operation Economic Fury sends regime into crisis. So this was previously, I think it was 344 or 374, roughly 300 mid 300 millions, specifically frozen by Tether,

basically on behalf of the government in Operation Economic Fury. That's up to 500 million now. So interestingly, this doesn't say it's tether necessarily. So I'm assuming that other assets in some way were confiscated here. But this is interesting to see such a crypto element to the plan in this case. Well, the Iranians have been using crypto as one of the many ways to fund the regime. And I think if you're looking at this kind of news, along with the news today of Dubai,

arresting a bunch of crypto scammers and an international sting. over 200 people. Yeah, 267. And by the way, there are connections between these two things, which is to say, if you look at a lot of the analytics around this stuff, and crypto is guilty of primarily looking at on-chain analytics for these. But if you look at open source intelligence data like social media data, dark web data, other data sources and combine it with blockchain, you start seeing that a lot of these

scam networks have links to each other, right? Like they're laundering money for each other. They're passing dirty money back and forth. And one of the unpleasant lessons that criminals and crypto are learning right now is that if you use a public blockchain, everything you do is public. Two, stablecoins have freeze and seize capabilities, which means if you're using a U.S. dollar stable coin, the United States is going to find a way to get their hands on you. And I think it's taken the government, if we're being honest, a little bit of time to, to get up to speed on those techniques and to figure out how am I supposed to do these things? But now that they've started to get their arms around that, they're going to act.

So let's talk about tether in particular because you brought them up. Tether, I will remind everybody is something like what, the 11th largest holder of treasuries in the world. They have a gigantic reserve. It's an incredibly profitable business. They brought dollar access to the third world. So do not take what I'm saying is a critique of tether writ large, any institution of that size will have money laundering problems. Here it's just public. And you can see what's going on. And because Tether has all those reserves, the United States can go to Tether and say,

we would like you to freeze X, Y, Z. And so Tether's got two options. They can say yes, or they can say, no, in which case the United States goes down the street to say Cantor Fitzgerald and says, please give us this amount of money out of Tether's reserve. And they will be like, yes. So, you know, I used to run the stablecoin platform at Paxos. I managed the reserves there. You don't functionally have the ability to say no and hold on to your reserve assets. That's a really interesting insight. I mean, I knew that you were there, but I didn't know that that was the situation, right?

Were you there when the whole BUSD thing happened? So I was there for all of 2022. We rebuilt the platform. I can't say everything, but the BUSD thing had already started. started at that point. And part of why we were so careful about liquidity management and like reserve sufficiency is you've always got to have somewhere in the back of your head, I might have to give all of the money back, like all of it.

And so a stable coin should be run very conservatively. But the other part you learn is if I have international holders, some of whom I have not personally KYC, that I have law enforcement who's going to be sending me notices, I need to find a way to thread like that needle. So a thing I've been saying for a long time, I think, because I experienced it firsthand is, if you believe in cypherpunk ideals and true decentralization, do not use stable points. Those are fundamentally centralized entities that will respond to real world law enforcement, whether you like it or not.

I think to be fair, if you listen to Palo Ardoino or certainly Jeremy O'Reilly or any of them, at no point have they disputed that. Correct. Carlos says we work with governments. We work with law enforcement. We always respond to direct requests. We are a tool of hyper-dollarization. Yes, I'm a bitcoiner, but that is not what Tether is.

I mean, he said it to me no less than 10 times. No, and if you look at the arc of Tether, right? Like, I'll remind everybody, Tether is actually somewhat old now. They were created in, what, 2014, I think originally under the name of RealCoin. Yeah. And there has been a long arc of evolution from a big. very, call it, crypto-native project. And let's be honest and say somewhat janky compliance and reserve frameworks.

And I don't mean that as a negative. I mean that all startups are like that. You build it. I'm trying to get a Ferrari down the roads in 1930 and try to figure out what the traffic laws were, much like finance and everyone else. Correct. And this is the nature of day for all the tether like doomers or whatever that maybe they were right 10 years ago and they're wrong now.

And they've gotten to the place where it's not going to be an issue. Exactly. Exactly. Like if you told me if there's a giant financial shock, will Tether have economic problems in 2018? The answer is probably very different than today. And to Tether's credit, I think over time they have realized this and professionalized their operations, which is what you would expect of an entity growing and building. So now you get to the current day. They have more liquid reserves. They have a much better handle on managing them. They know where they are. But that also means other people kind of know all these things. So now they've been building. the anti-financial crime apparatus and their own monitoring and like working much better. And I'll say this, not just with U.S. law enforcement, but global law enforcement. Tether, to some extent, might even have a better track record at this point of freezing funds than Circle does. And so the days of, hey, crypto is all crime are rapidly coming to an end as these people start to understand the landscape.

Yeah, I agree. So I think it's a nice pivot here to the defy hack. and everything's going on. I've been kind of slowly unpacking it as it's happened, because to be fair, it's been a slow-moving train wreck that you can unpack slowly. But, I mean, for context, you know, everybody knows, I think at this point that Kelpdow was hacked. This came after drift.

I think what was different in both of these cases was that we soon saw new and novel ways for most likely North Korea to extract money from defy that wasn't just, hey, we simply find a way to exploit you the bridge and hack it and go sell those assets. what they did obviously in the case of drift was a long social engineering campaign where they actually were handed the keys they convinced the drift that they were real and got access and extracted 200 whatever it was million in 12 minutes and then obviously in the case of kelp which is wild

they didn't just pack and steal the rs eath they then went and took a massive loan against it on ave which created toxic debt across more than 20 platforms in defy which which then leads us to this story, which I'm really struggling with. Defi United, coming together here to basically fill the hole. So I think on one hand, and I want your take. On the one hand, it's great that your average person's not going to pay for this, right? We saw this action with ByBit. They were effectively bailed out by the industry after the lessons are in 2020.

On the other hand, this reeks of tarp. That's lazy. but on the surface because it's not like coerced like the government. It also, to me, reeks more of J.P. Morgan 1907 banking panic. Like, get everyone in a room and tell them we got to save this system. Yeah, I think the 1907 analogy is probably the correct one, which is to say when a system is facing a collapse and you have a lot of interested parties, they have a natural incentive to get in the room and figure it out

because the other option, Scott, as you just said correctly, is collapse. Now, I think there are a couple of layers to this thing that are happening that you were hinting out there. One is how decentralized is this industry if the solution to a problem is let's get the rich people in the industry together in a room. And then we'll make a solution ourselves and pay everybody out. You know, back to your 1907, nobody was arguing the U.S. banking system was highly decentralized in 1907, right? Like there was one dude in the financial district calling the shots and his name was J.P. Morgan. Two, how decentralized and how well built are some of these protocols in the first place? I think that is a question that is raised here.

And then three, I think on the subject of decentralization writ large, can you have a decentralized system that is this complicated if you have a very sophisticated nation state actor coming after people? because I just, like, as a guy who's been a CRO, let me be very blunt with anybody in DFI who's listening. If you think your InfoSec can be good enough to stop the North Koreans, you are wrong. You need to be building your stuff with the idea that they will successfully get access to your systems so that they're built in such a way that if that happens, you still can't go break the current running protocol for people. Right? And that is not how the industry has been building. No, but that's because we have things like kilp Dow that I've never even heard of until this happened, where somehow there's hundreds of millions of dollars in potentially toxic collateral sitting there,

and nobody in the industry even considered that they would take a loan against a hack. So this was a new and I think entirely novel approach, and that's what gets me because AVE's smart contracts worked perfectly fine. But the problem is that just like FTT should not be used as collateral, maybe a lot of these, you know, I don't think WLFI should be used as collateral on dolomite at a 100% utilization rate to the pool either. Right? So like that what you accept as collateral is a really, really big deal. I mean, I would actually say this was knowable. Like we've seen a hack similar to this in the past, which was mango markets, if you remember that one.

Right. So, yeah. Yeah. Avi Eisenberg did basically this. He punted up the price of a very small token, the mango tax. token, borrowed against it in size instantly and absconded with all the assets, which is very similar to what happened here. That wasn't a little. It was fine. He was like, what, what? Working is intended. The code let me do it. Code is law. And what I would say to people is

crypto has had a long history of trading security in favor of efficiency, right? Because there are many layers to how you prevent a hack like this. But number one is, why can a new borrower you've never seen before show up and borrow that amount of money basically instantly. And I look at this and I ask, what would have happened if they'd had like, hey, if you deposit, your borrowing is like staggered and phased. So like your collateral has to be there for a while before you can take. There are many ways to put circuit breakers, like gradual movements of price or collateral or availability into protocols. And the market has been like, no, I want to be able to have a billion dollar loan right in a single block so that I can borrow it, do a huge trade,

repay it. But as a result, you are trading off a huge amount of safety. And now we're coming face to face with the fact that you have actively adversarial actors who do not care about the long-term functioning of this system using those exact features you've built. I just, to be honest, I think defy is going to be faced with the decision, Scott. And I'd like your opinion on this, have either become dramatically simpler and safer or get way more centralized to build in the kind of controls that the traditional market has. I actually question whether they're going to have the opportunity to make that decision when you see much capital flight there was here.

And I think that this may have actually been the straw breaking the camel's back for the larger like capital coming into DFI. So I don't even know if they'll get the chance, but I think it's probably they'll have to, I really love your point. I think that there's a, as with decentralization, people sort of have this, you know, bipolar barbell. It's either decentralized or it's not, but nothing exists at the polls. Everything is somewhere on a sliding scale of levels of decentralization, even to the point where you can be so decentralized, but AWS is your cloud server and if they go down or decide to freeze you, you're done, right?

So I would say that just like that, this is somewhere on that scale, but I like that it doesn't mean full KYC, to your point, because it's not just two options. You're the first person to lay out all those other things in between that I've heard, which I think makes sense. I just fear they won't have a chance. I mean, to some extent, maybe the current crop won't have a chance. I'm pretty optimistic. Future things could be built that are significantly, call it better. I, you know, and it back to. It would be like built by Goldman Sachs for Goldman Sachs clients, and it won't be defy at all, right?

A better protocol that's used within the Tradfai system that once again, we can't really participate in. Right. Yeah. I have doubts that's the future too because a lot of those are a bridge to nowhere. Like if it's built by Goldman Sachs, you know who's not using it, J.P. Morgan. And if it's built by J.P. Morgan, you know who's not using it? Goldman Sachs. They're going to need to find a way to open up a little in order to innovate. And this is part of why finance has been so stuck. But like I actually find all of this to be very optimistic. If we go back to another historical parallel, think about the internet in the 1990s. Like, Scott, you and I are both old enough to remember getting sent like something like

892 AOL CDs a year or whatever the heck they were doing. And like Netscape was the browser of choice and you log on with one of those horrible modems. Like, yeah, we don't use any of that anymore. Like none of it. And none of that is a refutation of the value of the internet. It's just progress. So there's going to be things that will emerge in the future.

Like nobody in 1995 was like, you know what? TikTok. right like that was not the thing and so I look forward to being surprised by what people come up with my space was still better shout out to Tom I mean my space was a real moment in time I mean I just yeah I don't know what happens to defy I mean here's who's contributing also I think it's worth noting that we get these articles like this that say you know 300 three three three hundred three million dollar bailout, but if you actually look at the numbers, it's being presented completely wrong. Yes. Because you look at the top, Arbitrum Dow is 30,765 of those, those are, that's

ETH that was hacked. Yes. That's coming back. That's not like Arbitrum's like I'm donating 30,000 ETH to the cause. That's literally the token. I'm returning your stolen funds. Right. So and then you get you get down to you know like Stani giving 5,000 ETH. You guys might remember Warren Buffett, I think put five billion into Goldman and five billion. into Bank of America in 2008, kind of smells similar. But then a lot of these are actually loans. Yes. Right?

So it's not like there is a definite and element of, you know, people plugging the hole with their own funds. And here you go, no expectation except for to save defy. I mean, you have Circle like literally announcing they're going to buy AVE token, you know, just to kind of show a faith. But a lot of this is still like in the interest of the person who's doing it. If they believe that DFI will continue and then Avey will remain the blue chip and it has to, they'll get paid back with interest.

And to some extent, if they don't, at least they're buying themselves time to figure out solutions to do other things. Because your worst case is just leaving this unresolved. And a reminder for everybody in the background here, back to our discussion on real world assets, a bunch of people are going to be suing each other over this and we're going to be chasing exchanges around to try to see where the money went from North Korea. That's going to take years. Right. And I'm maybe being charitable with only years there. So it's not a position where they can really wait if you want Ave to continue functioning in a regular way, Scott. You'd either have to just take the hit and haircut everybody or you've got to find the money.

Yeah, I mean, what happens if they don't step in? Here's my better question. Okay, what happens if this is $5 billion? I was going to say, there is a point at which the system cannot bail itself out. I remember sitting in a meeting with one of the very big bank CEOs post 2008. somebody dropped the line, guys, at some point, the financial system is financially systemic, right? Which is to say, you can't save everything when the problem gets big enough. And five billion, I don't, well, five billion is probably at the outer limits of what the industry

potentially could have done because if like Binance and Tether come in, that kind of money is there. But like hypothetically, imagine a critical bug is found in like one of the uniswap contracts. That's right. It's just kind of over. And so this goes back to the point I've been raising for a while of if you have truly hostile threat actors like the North Koreans operating in your space, there's two good models of security. Number one is keep everything super simple and ideally segregated so that if something gets hacked, it's like, oh no, Austin lost the $512 of USDT and that one prepaid card. I mean, I'll be mildly annoyed, but that's not systemic to the industry. The other option is you're going to end up building things that are more centralized, slower, and with more toll gates along the way to make sure that people don't abscond with the funds.

You know, it's, I'll jokingly say in very crypto fashion, they are reinventing like access controls from first principles with some of these actions here. Yeah, I mean, what they should do is make somebody convert that RSE, into something that will not be toxic collateral and then take a loan against it. Just, dude, you got to flip your RISD into ETH and you can get your big loan. Right. Phone anywhere. Flip it into Bitcoin and take a loan with a limited LTV.

We have your collateral. Have fun with your $2 billion and play with your cryptos or whatever Donald Trump said, Nashville. Have fun playing with your cryptos. I mean, that certainly solves that is the collateral itself worthwhile problem. It, however, does not solve. the real world legal problem of are those stolen funds? Yes. Because you could still get swept into a whole lawsuit where you get clawed back, e.g. Bernie Madoff, right? Like, that is its own sort of problem.

So, like, hypothetically, if AVE had been built so that the collateral pool was much narrower, exactly as you just said, but also when you deposit funds, you can't borrow against all of it at once. It like steps up, call it 10% per, I don't know, six hours, pick some incremental time frame. damage would have been much lower. Yeah, it would have caught it much earlier. You probably also can't just flip R.S. Heath into Eth for $200 million with no slippage in real time or whatever. So you, but that already shows you it's toxic collateral before it was even toxic collateral. So what are we doing here? Correct. And there's a good argument that your collateral limits should be based on like trailing trading volume, right? Back to how do repo desks on Wall Street work? If somebody shows up to me

with like, hey, I've got, I don't know, a hundred billion of off the run tips. I'm not going to lend them a giant amount of money and full value on that. Yeah, I mean, I don't, I think we just need to, like, one huge step would be to just determine what's not worthy collateral. I thought we had solved that to 2020.

Like this whole composable finance bullshit, like I take a load. It's still, it's still tacos and yams from the original DFI summer and farming just dressed up with bigger numbers. But like really, if you step back, like should something called R.S. Heath exist and should you be able to take massive loans against it? And should it be yield on something that's already earning yield that's on something that's rehypification. Come on. Yes. And my answer to those is I'm fine with it existing. It should not be good collateral. And people should be thinking a lot harder about the risk profile of why they're doing this stuff. I mean, Scott, here's a question for you. Given where yields on stable coins were prior to. this hack. So let's call it 2 to 4%. And the fact that you can get 3.5-ish percent in a government money market fund, would you have left your money in AVE? It's so funny. No. Obviously, so first of all,

I would never do anything for a 2 to 3 percent yield, no matter how safe I think it is. But didn't the Bank of Canada or the central bank, something in Canada like a month ago was raving about how AVE specifically, but DFI had like never had an issue, zero percent. I mean, you're effectively saying, like, it's so safe that I will accept a inferior rate to what's considered the risk-free rate. And given, like, a lot of people in Defi can't buy bonds, I'm sure. Yes. But, yeah, I'd rather, like, how do you not just say, I'll go buy STRC at 11.5%. Like, if I'm taking risk, why would I ever participate in Defi when I can go buy STRC?

Yeah, as a general rule, I would say for people in crypto, if you're getting paid less than, high-yield bonds, you're probably not getting paid enough. Like, that is the least risky risk instrument that I'll at least start to accept comparisons to, right? And God knows if you can do better in treasury money markets, you should probably either just do that or find somebody who can. Yeah. I want to talk about the next big story of the day because I really need your help on this one. Oh, boy. This is the news that Jack Mahler's 21 capital surges after majority holder tether proposes.

three-way merger. So I've read this, I don't know, by red, I mean fed it into AI like nine times and tried to get different takes on it. But effectively we have 21, which is obviously the Bitcoin Treasury Company that was backed by Cantor and SoftBank and Tether. Bought a whole lot of Bitcoin at the very beginning, haven't heard much from them in the last year. But Jack Muller also is the CEO of Strike, which is a financial services company. And then they're merging with a mining company, correct, which is called Electron, which honestly, apparently controls 5% of the Bitcoin network. So sizable player here. And then you have Tether investment arm, but not Tether themselves. It's basically proposing this and will put their votes behind it. Is that a correct

summary? But so what I think on the surface, what people are saying is now you have a treasury company that actually has some real utility, their mining, and they have a full suite of financial services. So we have a treasury company that actually is going to earn money to buy Bitcoin. You've created a monster. And then the skeptical side says this looks a lot like David Bailey taking Nakamoto and buying the Bitcoin conference in UTXO, which whether you agree with or not happened, right, where you can have a take on that or any of these others. I mean, Pomp, you know, pro cap bought Sylvia, his own AI company. Right. So is it a consolidation of interest or is building a powerhouse, I guess, what we're getting it, and will it even happen?

Okay, so one, I mean, Scott, as you know, but for the viewers, I've been a pretty sharp critic of Dats over time and skeptical about that business model. On my gravestone, I will have skeptical of Dats from day one. It's going to be my big hit. I wrote a newsletter, right? Like, I write this newsletter, Zero In, and I was very skeptical about Dats early on, and I got a lot of hate mail and a lot of, like, that hate mail. and a lot of like that hate mail is aged like cheese.

So, you know, I'm with you on that. But I said there are only two kind of dats that make sense. Dat number one is a dat that is trying to buy cash flowing businesses, right? Like you're trying to put together a thing that can actually have real economic activity. And the debt component is just a convenient form of fund grazing. So think of this thesis as I'll call it crypto Berkshire, right? Like I'm just going to use this as a capital accumulation engine. That could work if you execute it well.

But you need a real operator to do that. That's not some crypto guy starts a company and decides that he's going to be Berkshire Hathaway. Correct. You probably need people who think very deeply about like investing in cash flows and business models writ large, which as we've discussed, rarely happens in crypto. Two, the other one that hilariously would work well as a dat created to unwind all the other dats, right? Because like basically a debt hold like a fund of funds for that's. Right. You look at them and you're like, oh, okay, well, you've got all these assets.

You're trading way below nav. I'm going to accumulate this and force you to unwind and have the infrastructure internally to take all of that in and liquidate it, right, which means you need like custody, trading, et cetera. But that's basically a purpose-built hedge fund, right? That just goes around like murdering all the other debts in the market. Okay, fine. So when I look at this, I ask, is it one of the,

those two things if I want to have any like probability of success. And the answer here is probably no, but it at least has a chance to move towards the first one. And the reason of a little like number one, although it, but with all controlled interests being the same. We have the CEO of two of the companies. See one guy is CEO of two of the companies. Yes. And the other part is all of these are very highly correlated. Like we have a Bitcoin treasury company with a Bitcoin minor with a payments company that wants to do Bitcoin, all of this is still just, hey, I own a bunch of Bitcoin. If this entity goes and starts buying other less related businesses over time, then I will start to get more optimistic about what they are doing. Like if they find things that, for instance,

you could transform the business model by incorporating stable coin payments and you're just doing the thing of like, let me improve your margins, improve your margins, improve your margins, Now I'm going to get very interested. But right now, as an investor, it's impossible to discern. Is this like a just corporate conglomerate combination, or is this going to be a real thing? I would put a third option, which is my less intelligent brain. But how I kind of framed it from the beginning, I always thought that the idea of a Bitcoin treasury company as a business was nonsense because it means financially engineering Bitcoin and strategies doing it.

And good luck beating Sailor who has a huge lead. Right. But I love the idea of, so yeah, Bitcoin treasury company. I love the idea of a company with a Bitcoin treasury. Yes. Right. So just take your existing business that actually has cash flow, and instead of holding cash, hold some Bitcoin like Tesla does, right, or SpaceX, whichever it's on the balance sheet of Tesla, block. Right. These are companies that have an asset that, you know, is a part of their treasury that if it appreciates massively, it could become effectively what their operating company is about, but obviously not at massive risk. Sort of the way you would tell a person to put Bitcoin into their own portfolio

if they don't get it as a deep believer in the freedom tech, right? I should go, put 10% of your personal assets into Bitcoin and call it a day. And so that I think is kind of the third one. This is obviously not that, right? Yeah, and that I, so I would say for me, that's not really a Bitcoin treasury company. that's just a company like managing its money because everything you just said about Bitcoin. So take like Apple, right, as a balance sheet that has a ton of cash. I could take your whole statement there and replace Bitcoin with gold and it would equally

hang together for Apple. Right. That's just telling people like maybe don't put 100% of your cash in dollars. Yeah. Yeah. Fair point. I think that's fair. I mean, I don't really know what the future of Treasury.

companies is at all. What is interesting here, though, is that Tether themselves is invested in a lot of non-crypto things. Like heavy investments in AI, obviously gold as well, Bitcoin, clearly, but that's why I wonder what their role is here. Like, it's viewed as a three-way split, but how involved does Tether themselves and how much will, like, their view on investing impact this because they're spread all over the place. And I think that's a smart move for Tether's. So like to the guys over there running that strategy, I think it's a good strategy, which is to say you've built an incredibly profitable, call it financial monopoly almost

in the call it crypto euro dollar space because most of Tether's business is non-U.S. You would naturally ask the question, how much further do we have to run here? Because it's not infinite. But we're generating huge amounts of cash flow. which means you got two good options, either take it all out of the business or start diversifying what you own. And ironically, rather than the dad's doing it, it seems like Tether is trying to become crypto Berkshire if you look at what's going on here. Yeah, I think that that's the best take is that this is part of their Berkshire and this is not going to become Berkshire itself. Listen, I hope this goes great.

I do too. Like, again, I think this one is one of the few ones where I've seen it where I'm like, oh, the chance is not zero. Like there is a real path here because I'll tell you, Scott, I am pretty confident in where most of the Bitcoin treasury companies go and that's they get unwound. Right. Because it's terrible. And the stock goes to zero after every, yeah.

I mean, it's the only way. And I thought there was a chance at some point that maybe Sailor would look at these and do number two. He still might. Right. I mean, if these are trading it, you know, like, I don't even, what is the discount to nav on the Nakamoto or something right now? I have not looked. I have no idea. But they're large, like, well into the over 50% for almost every. I mean, now we're in like GBTC discount territory. Yes. And that was the trade of the year that people didn't really talk about was just buy GBTC. ETFs get approved and all of a sudden your Bitcoin's worth twice as much. But keep in mind, Grayscale did the industry as solid by converting that thing. I think a lot of the reason many of the these trade below, like so far below, is if your insiders have the control rights, how do you force them to convert? And the answer is, oh, there's a way, but it's going to involve people like Paul Singer, like waging warfare against them, both legally. And I guess in Singer's case, maybe literally,

because I'll remind everybody that dude stole a military boat from Argentina, like he does not care. But it's going to take activist investors of that sort to like hire private detectives to follow these people around and like sue them constantly to get them to relent. Yeah. One last story. I know you're going to have to go soon, but you're smart and I have a noon show and I want to talk about these things. So I'm not going to steal your thoughts.

Let's do it. That's okay. Meta quietly rolls out stable coin payments. Is this this way? This way. Yeah. Four years after demise of controversial Libra products, a product. So to the credit of meta.

They really shot their shot back in the day with Libra, Vendium, and took a bullet for all private companies that wanted to create money or stable coins. But here we are. Listen, this is only in the Philippines and Colombia. They're paying creators. It's not like they're accepting stable coins to my knowledge yet. YouTube is actually paying. I think you can pay all creators in stable coins on YouTube via P-Y-U-S-D, which makes me giggle that there's a stable coin called GSD. Sorry. Sorry, Austin. I didn't mean to bring you into my maturity. Well, I was, I'm just going to say, I told them there are so many good names for your stable coin when I was at Paxos and they had to pick that one. Justy. But so listen, but this is a signal, right? And to what I read, it's via USDA. I cannot confirm that, but not their own, definitely not their own token. Yeah, it says USDC on Falana and Polygon.

Solana is crushing right now in stablecoins, by the way. That Western Union announcement, the other day was Salana as well. Excuse me. Yeah, it was. So a couple of things there. One, I will remind everybody in the Genius Act in the United States, if you're a publicly traded or large private or foreign company, you're banned from doing a stable coin unless you are a financial company. Right. They kind of put the reverse of the bank holding company act in there, which is to say, if J.P. Morgan can't be a social media platform. The social media platform can't be J.P. Morgan. And so meta kind of has to partner. Now, we know they've been interested in stable coins for a long time back to Libra, which

in many ways kicked off the whole set of affairs that led to genius. It doesn't shock me that they're building this in. And it makes a lot of sense. If you deal with international payments, do you want to go through the correspondent banking wire or like hop-to-hop local payment system? or do you just want to do one transaction on chain? Right? Like one of those is vastly easier than the other one.

So if you can build that framework in and make it very easy for all of your creators to send or receive money, you're also, by the way, building a merchant network that is then scalable to many other things. This is a real idea. And there are versions of essentially what's going on here that actually have gotten quite big in crypto, Scott, that people don't even talk about. Like, have you ever heard of mini pay? No. Okay. It's got 12.5 million users who are real two-legged people. These are not bots.

It operates on cello, which is now an L2 on E. It primarily uses tethered. It's primarily in Africa. But that is essentially crypto Venmo. And it's real. So these sorts of implementations to me are where the industry has sort of the biggest potential gains. And this is a way for meta to essentially become a coordination layer for payments, you know, a little bit like an Apple pay or a Google pay, is if you're using stable coins to do this internationally and you do it right, it's just going to be a much, much, much better experience for the users. I was trying to pull up the Polyon chart, but it's glitching because it's both my mind. So you want to know how.

We've got Polymarket. I was just to say if you want to know how dead crypto is, like the alt. sees inside. Like, this thing's an all-time low. This was Maddock, it became P-O-L, on an announcement that meta is using them for stable coins and polymarket called polymarket because of polygod, right? Yes. I mean, how, what, what's going to be a catalyst for anything that's old to. Well, actually, I'll pile in here and say, that may be the market being correct. And what I mean by that is for a long time in crypto, people believe fat protocol thesis. That is to say the L1 will

accumulate the value here. But I think a lot of the apps have realized, hold on, I can just play Solana off E, off Polygon, off Avalanche, off Miston Labs and Swee, off stealth, like make them all fight. I think the value accrual may be to the apps, right? Like, would you rather be an investor in the Polygon token or just in Polymarket? Yeah, I mean, it makes sense. It's just kind of mind-blowing. I was trying to bring up the chart here. I mean, this is like, it did get a little pop for being fair.

Little pop. This is like the meme of like the giant red thing and then the one tiny green bar, the it's happening, right? Like one percent with the like guy. Yeah, for like the Chad texting guy. Yeah, so good. I would tell you this. If you want to run this play, like if you think this is a meaningful announcement,

the value is probably in meta's stock. Yeah. Right. And the problem there is that's contaminated with the AI spend. So like, I don't know how you isolate that. Bruttle, man. Brutal. All right.

Well, I'm going to let you go. That's all I had for you today, man. I appreciate it. You helped me think through a lot of things. Really great perspective. It's what a while. I would never get bored. No.

I was going to say we will have another decade of excitement, at least, in this industry. So we've got that going for us. Wow, man. All right, Austin. Thanks. Glad we finally got to do this. We do this on spaces like, you know, twice a month at least for the last few years. So it's good to do it, do it face-to-face. A video. We'll definitely do this again soon if you're willing. Absolutely. It's good to see you, man. Enjoy the straight. Thanks so much, man. I'll see you soon. Bye, everybody.