The Wolf Of All Streets - Crypto Blood Bath! What Should You Do? | Crypto Town Hall

Episode Date: May 1, 2024

Crypto Town Hall is a daily X Spaces hosted by Scott Melker, Ran Neuner & Mario Nawfal. Every day we discuss the latest news in crypto and bring the biggest names in the space to share their insight. ►►TRADING ALPHA READY TO TRADE LIKE THE PROS? THE BEST TRADERS IN CRYPTO ARE RELYING ON THESE INDICATORS TO MAKE TRADES. USE CODE ‘2MONTHSOFF’ WHEN VISITING MY LINK.  👉 https://tradingalpha.io/?via=scottmelker  ►► JOIN THE FREE WOLF DEN NEWSLETTER, DELIVERED EVERY WEEK DAY! 👉https://thewolfden.substack.com/    ►► OKX Sign up for an OKX Trading Account then deposit & trade to unlock mystery box rewards of up to $10,000!  👉  https://www.okx.com/join/SCOTTMELKER ►►NGRAVE This is the coldest hardware wallet in the world and the only one that I personally use. 👉https://www.ngrave.io/?sca_ref=4531319.pgXuTYJlYd ►►THE DAILY CLOSE BRAND NEW NEWSLETTER! INSTITUTIONAL GRADE INDICATORS AND DATA DELIVERED DIRECTLY TO YOUR INBOX, EVERY DAY AT THE DAILY CLOSE. TRADE LIKE THE BIG BOYS. 👉 https://www.thedailyclose.io/   ►►NORD VPN  GET EXCLUSIVE NORDVPN DEAL  - 40% DISCOUNT! IT’S RISK-FREE WITH NORD’S 30-DAY MONEY-BACK GUARANTEE. PROTECT YOUR PRIVACY! 👉 https://nordvpn.com/WolfOfAllStreets    Follow Scott Melker: Twitter: https://twitter.com/scottmelker   Web: https://www.thewolfofallstreets.io   Spotify: https://spoti.fi/30N5FDe   Apple podcast: https://apple.co/3FASB2c   #Bitcoin #Crypto #Trading The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. This video was created for entertainment. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor.  Nothing contained in this video constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.

Crypto, obviously, having a rough time at the moment. A lot of people looking at Bitcoin and seeing its broken 60,000-ish support after holding it many times and ranging sort of between 60 and 74,000. From a chart perspective, I think that it's a pretty clear gap from that 60,000-ish area down to 52,000, where we had some consolidation in the past, a lot of people pointing to sort of that there's no support in that area. That said, when everybody's watching a level, usually it gets front run or completely nukes through. So it would be probably surprising if the thing everyone's expecting to happen happens. But I would love to dig in with the panel and see what they're thinking

about this market. For now, it's a 23.8% top to bottom retrace or so from 74% to, depending on the exchange, just sub 57,000. That's still, for context, really, really shallow versus other bull market retracements. I assume most people still believe we're in a bull market and pretty consistent with the retracements that we've even seen just in this bull market since the bottom. So 20% to 25% generally not a big deal when you are in a bull market, but there seems to be a disproportionate amount of panic in my opinion based on that. And I think that's because even though Bitcoin dominance has dropped a bit over the last few weeks and alters trying to keep up, they got very, very destroyed sort of at the

top of that move when Bitcoin hit the all-time highs and then started to drop. So Joe, we haven't talked in a bit. What's your general take on the market here? GM, GM? Yeah, it's, you know, Scott, you've been talking about it for weeks here, you know, the market cooling off a little bit. I think the main catalyst to a lot of this, you know, we have to just raise up to macro and everything falls back down is interest rates higher for longer, maybe going up. I don't think they're going to move up. I think they just kind of stay flat and we stay higher for longer. But that is stifling, you know, kind of markets are forward looking. And it's kind of stifling this margin that we had moving up to all time highs and even higher than that. Because, you

know, the fundamentals of everything that's out there are pretty similar. You know, something that I kind of look at that kind of trickles down to the rest of the market with crypto is just housing. You're seeing a lot more houses come onto the market right now. I know it's spring, it's a little cyclical, but I think that the economy is finally getting squeezed to a point where even though interest rates are high, people need to move. They need to liquidate some assets. They're willing to take those hits. Unfortunately, I would say a lot of the buyers of these things are not your millennial or single family. It could be investors. It could be probably someone that is a baby boomer that's had a lot longer to be in the market. They're still working. They thought they were going to be retired. They're not. Now, they have a lot more savings. They can afford to put 50% to 60% down on a house and they're beating out a lot of the younger people on these things. And so, you're just kind of seeing the market, everyone looking like, shit, I'm going to get squeezed for how much longer here now? And so that everyone's just

kind of, their hands aren't reaching into their pockets all the way and they're going to take a step back in the market and say, hey, I'm going to hang on to that 5% APY and that Robinhood count a little bit longer and just kind of go back to work. And so, you know, I think you're just seeing that trickle down to the rest of the market, including Bitcoin. And then, yeah, you're seeing alts getting crushed. But like we said, and we always say, not financial advice, but man, why wouldn't you buy on red days, right, as opposed to green days? And here's another red day. We're going to have a couple more. It's like, these are the days you should be paying attention versus the days, you know, you're like, oh shit, I don't want to look at my portfolio.

So yeah, that's kind of what I'm looking at. I think, I think we kind of range here for a little bit longer, maybe a little bit lower. I don't, I think we're maybe past the days. We're going to see these 20, 30% down ticks with like major news. I mean, we've had wars, we've had all sorts of things that can really punish us in a, in a bad way. And we just kind of move up or down five, 10% in a multiple, what's happening, you know, in the, in the QQQ.

So that's kind of what I'm looking at. And I think, yeah, we're, we're just going to be kind of ranging here a little bit lower for a little bit longer. Yeah. I mean, I tend to agree. Like you said, it's kind of we, we, we hit the euphoric peak, I think, with people sending $30 million in 30 minutes to random addresses on Solana, hoping that they would make some money. That's usually a pretty good sign that things are starting to top. Everything was massively overbought. And now we're just getting to the point where things are starting to be oversold. And now is when people start to panic, right?

So I think we have a similar... Even at those range lows at 60, now certainly, I think we have a similar opposing vibe to what we had at the top, right? The level of panic now is commensurate with the euphoria that we saw at those levels. Listen, I don't think this market's going to do very much for quite a while. Maybe I'm wrong. Maybe it'll be a catalyst. But my expectation at those March highs was we cool off and that we're going to get really boring and we're going to start to see a lot of time-based capitulation where people just freak out after four or five months of boring, of a little up, a little down, and not much

to do. And then maybe we just kick back into the normal cycle. That said, today is FOMC, to your point, Joe. And if you believe macro is driving, well, there's not much bullish expectation, I don't think, about FOMC today. I mean, rationally, I agree with you, Joe. I don't think they would hike because it would be so politically unpopular. But if you actually look at the data they release, which I generally don't believe, a hike probably makes more sense than a cut. And that's what I've been saying literally for, I think, over 12 months now.

But people definitely starting to realize those cuts may not come anytime soon. Right. I mean, Dave, what do you think right now? You know, market, we broke 60,000. That was the very strong support. Does it change anything for you? I mean, the macro range is clearly down, the macro trend. It is, however, markets, I was thinking of trying to figure out a clever way to tweet how markets always exist to humble us.

And, you know, people are always trying to get in front of what it's done before and assuming that what it's done before is some sort of playbook. The reality is that the forces that matter for Bitcoin are supply and demand forces. You know, we've just had the having, yeah, yeah, whatever. I mean, you know, relative to ETF flows, what happens over the next few days in terms of ETF outflows is going to be determinative. If, as I expect, there really isn't a whole lot of reaction, I mean, not, you know, on a percentage terms, because people that bought the ETF are buying it for long term, then I think you stabilize and the range is just a bit bigger, but it's still a range. If, on the other hand, there's always a lot of hot money in the ETFs and you see a cascade out like multiple people predicted would happen, we should be in the 40s by, I don't know, Thursday. You know, you would expect that. So I think that's a very big deal. As far as the FOMC is concerned, I mean, we talk about this on Monday. The Fed is, is is you're right from a U.S. domestic point of view. You can easily see why they would want to be raising rates. But it's not only that. If you look what's going on in Japan, U.S. raising rates is, I'm sure, the subject of a lot of conversation. And there are some major stresses in the global economy, you know, in terms

of the end trade, etc., unpacking it that matters. And to be blunt, the Fed and the government wants asset price appreciation. They certainly don't want asset prices to fall. So where Mike McGlone and I, I don't know if he's, no, he's not up here, he and I always agree on is the Fed won't cut until it looks like something's breaking. And so I think we're stuck in stasis for a while. And that that's what I would expect. And I'd expect that the language would be more hawkish than people might be anticipating. But at the end of the day, it won't matter. Yeah, bearish, bearish pause, continued pause, right? I mean, just kind of say nothing and say data dependent and maybe it's going to be a little longer before we'll consider cuts but they're still on the table

i mean people forget that in december we were talking about four cuts this year right and now they're saying maybe one maybe not you know it just all you have to do is if you start watching the indicators and what's going on in other markets, that to me is important, right? You know, we tend to be in a little bubble. But, you know, when gold is continuing to hold good levels and continue to move higher, that's the same. And you and your Peter Schiff podcast, I mean, obviously, he won't take the bait because whatever, he's a dog with a bone, a really, you know, over chewed bone that, you know, you know, I don't say I don't think there's any meat on that bone anymore. But the reality is that the same basic reasoning applies to Bitcoin. It doesn't apply to a lot of the

altcoin markets. And you know, my thoughts on Bitcoin dominance and where we should be relative to meme coins, which, you know, meme coins imploding down 90 to 95% before we see a rally, while that seems to be will make me very unpopular by saying it, it is not out of the question. Because the sole question is how much I would imagine most of them already are, by the way, because they were being flipped so fast that if we put them in an entire bucket, there's got to be thousands of them that were only popular for a few hours. Right. Well, OK, but I'm talking about Doge inside. You know, like we're talking about the big ones. I don't know.

I'm basically saying that the hot money that was rotating out of Bitcoin when Bitcoin looked to be range bound and Bitcoin was continuing to go up because there was new money coming in via the ETF, that that hot money has a tendency of evaporating very quickly. And, you know, when you get into markets like this, and that's the difference in the dynamic. So my base case has been Bitcoin dominance will go up throughout the same because you and I both think that we're going to be range bound for a while. I tend to wonder about the catalysts that are out there because we have such a screwed up world that we live in. Who the hell knows what's going to happen? But I think that that's something to watch from a crypto point of view. From a Bitcoin point of view, what needs to be watched is the twitchiness of all the new money that has come in. I think you pointed out this morning that 50%, someone pointed out 50% of the buyers of the ETF are now under.

Yes. Yeah. If that creates a cascade out of the ETFs, then yeah, Bitcoin's going to go down quite a bit. I actually doubt that it'll happen, but we'll see. Yeah, I think most of them I've said they'll just pat their passively investing and probably aren't paying that much attention. So I don't think that they're panicking. But go ahead, Zach.

I was gonna say, well, the thing about meme coins, at least two things they have going for them is one, they're, they're pretty liquid. And then two, there, there at least was new retail money coming into the Solana meme coins. The sector of crypto I'm most worried about from a price action perspective are the illiquid VC coins. I think one of the dynamics that's different, I guess there are two important dynamics that are different this cycle than last cycle. One is many more people are participating in private sales than last cycle. Last cycle, it really mostly was institutional investors in the private rounds, and they dumped on retail who provided exit liquidity and ended up getting screwed here.

This round, I think a lot of the people who were dumb money last cycle think they're smart money this cycle because they got into a eight or nine or sometimes even 10 figure seed or series A round for a token that hasn't launched yet. And then there are these much longer lockups than there used to be, right? That projects in 2020, 2021, oftentimes didn't have any lockup. Now, partly because of securities law reasons, partly because of community expectations, there are very long lockups on most of these projects. And they kind of all seem like they're going to unlock at once at the end of this year, right? We're gonna see a lot of token launches throughout 2024 and then late 2024 into 2025. All of a sudden, all of these AI coins, the RWA coins, the, you know, deep in, like, they're all going to hit the market at once. And like, I kind of think that's going to

be a disaster. Because right, I mean, we've definitely seen already with meme coins, and to your point, the ones that have launched, you know, we don't have much extra demand outside of the Bitcoin spot ETFs in the market. And that does not trickle down in the same way that you used to, right? I mean, spot Bitcoin trading, you used to get this cycle where people who were in Bitcoin got bored, they moved down to large caps, down to small caps, and then back into Bitcoin when it started to move, right? We've all seen that cycle. A lot of these Bitcoin buying right now is from ETFs. And you know, somebody can't flip into a meme coin in their retirement account. Right. And so to your point, the more coins that we launch is if you're just looking at it from a binary supply and demand across the entire market, you just have a lot more supply of various coins on the market without increasing demand.

And that's why the music had to stop on that musical chairs rotation that we were seeing with meme coins. Now, I don't know if I necessarily agree entirely about the private sales. I think that there will be tokens that do exceptionally well because they're either hyped or actually have utility. But I would say that just like in past cycles, 99% of those trend towards zero. But how many people want to... At least these meme coins are starting at essentially zero, right? Who is going to be the exit liquidity for venture-backed coins that did a private round in the hundreds of millions of dollars valuation? I don't know who's going to be out there, who's going to sign up to be that exit liquidity. I had Josh Frank from the tie on my YouTube show

this morning. And we were kind of talking about this exact phenomenon that he was digging pretty deep into the data. And he was making the point that people should be looking at FDV sort of fully diluted value more than market cap. Obviously, market cap is what's on the market fdb is what will be on the market you know like a fully diluted valuation when all the tokens are released and he pointed at and i didn't realize this he pointed at world point um and i think he said i don't want to be inaccurate but i think he said that only two percent of world coin supply had yet been released onto the market, meaning that there's 50 times more supply yet to be released onto the market. So think about what, in that case, would be

required from a demand perspective just to keep price effectively in the same place. And I think it was, you know, sub a billion market cap or something and 2 billion more were being released just this year. That's correct, Scott. There's a $900 million market cap and a $44 billion fully diluted valuation on that. I would say really quick, don't underestimate the markets, the narratives around that. There's a lot of things that can run because people would say it's the same dynamic as when a startup has Andreessen leading a Series A. Suddenly Suddenly everyone's like, oh shit, I need to be a part of that. Right. So if you have some quality VC names that are investing in things like Scott saying that potentially have some utility or even are a layer one, and it's like, what utility, you know, is some of that outside of, Hey, I, you know, I'm just sending money around like

everything else. People just, it like, People just hop into these things simply because those names are part of it. So I wouldn't underestimate that piece of it. Yeah. But Joe, I guess the point I'm making, I think is different. The cycle is the people that have the money to do that in a reasonable way are already doing that in the private markets. These projects are raising series A pre-launch valuations that are nuts. And I think that is driven by, oh, shit, there is smart money that came in an earlier round. I just don't know once these tokens are liquid. And those of you who participate in the private crypto markets, you've seen the same warrants I have.

At the 12 months post all of these TGEs, there's going to be simultaneously big unlocks for all of these projects, kind of all at once. And if the four-year cycle exists, 12 to 18-month unlocks that people are investing in things now, you're talking about potentially going into next summer, potentially a bear market or a downturn. And I think a lot of people are looking at that. I mean, last I spoke to Arthur Hayes, I had him on my podcast five or six weeks ago. I don't remember what it was. And he basically said, yeah, we invested last year during the bull market. He's like, I wouldn't put money into anything now that has any sort of longer unlock schedule. I mean, that's how I feel. That's how I feel too, right?

I mean, like you kind of had to, with the modern unlocks, you kind of had to do that during the bear market and think ahead. And like now, even if the tokens can do really well at launch, I feel like the private round investors are going to end up being exit liquidity this time. Yeah. Really well at launch might mean they get their money back. Right.

So like your, your 15 or 20% initial unlock, if you dump by the way, which is going to wreck the price and momentum, you might get your investment back or make a tiny little bit of money. And then the rest of it you either view as a potential stimulus check or, you know, loss. I don't know. But yeah, I think that people have gotten wise to the game this time.

Eamon, you've had your hand up for a while. And then Iago. Yeah, thank you very much. From my point of view, I think we as a crypto community, we should pay a closer look to the macroeconomics of the things, because the situation now is that the figures are lower than expected from growth and from inflation. And there is like this big cloud of hyper, of stagflation that is over the world now. And it's very bad because from a government perspective, it's kind of a tricky situation where should it raise more interest rate and

cause more depression? Or what should be done here? And also the world now is facing a lot of these turmoil in the Middle East and every corner in the world, like there is a problem. So, yeah, us as a crypto community, we should pay closer attention to that. And the way I see it is that maybe we should think more of crypto or coins

that are linked to somehow to real economy. So whether it is backed by tokenization or have a utility going from somewhere in the real economy. That's what I wanted to say here. To me, this all feels very, very similar to what we've seen in previous timeframes. It feels very much like early halving activity. So the way the price rises after a halving feels like a hill, right, where it begins quite shallow and only towards the end does the rise become fast and steep.

So that's something that I've been expecting and seems to be in line with what we're seeing. We've been seeing an overall rise in price towards the halving, but it is certainly capable of drops and will be quite a shallow rise initially. The other thing that we're seeing right now, which we've seen previously around halving periods, is there's a whole new wave of FUD. There's new walls of worry. We've seen a bunch of developers being indicted. We've seen the FBI recommend that people not use self-hosted wallets, etc.

This all feels very familiar. If before it was China, now it's the United States. And then the third thing is that the primary narrative of this cycle hasn't formed yet. And that has also been the case in every single halving previous. So if you think about the 2014 period, it was altcoins. And then later in 2016, 17, it was ICOs. And then later it was DeFi Summer. So if you look at DeFi Summer, it started in July, only with the very first inklings of it occurring. And that was close to two months after the halving. I think one of the reasons that we're seeing so much activity and interest in memes is because this time around, people are aware of the fact that we're heading into a halving.

They're expecting the overall markets to rise in price, but no narrative has crystallized. The ones that people are trying to push right now, I think, are either too confusing. So deepen, what is that? Why should a regular person care about that? It may prove that if they can issue enough tokens and people earn enough, that they can gain sort of some momentum to that narrative. Real world assets remain as regulatorily complex as they ever were and is also very difficult for retail to participate in. And so we're kind of left with meme coins. My view is that the pattern that we've seen up until now has always been an overall increase driving the momentum as the halving begins, the creation of a narrative which starts to see winners, and most of that is driven by funds already in the crypto space.

And then only later do we see retail new entrants start to participate. And I would expect very much that the pattern would hold. Overall, my sense is, as opposed to the speaker before me, that crypto remains very much a world on its own. Because of regulatory reasons, it's hard to see any sort of use of real world assets in crypto over the course of the coming years. And also the macro environment, you know, it changes, it comes and it goes. And that has always been the case for Bitcoin. It's always been the case for crypto. And ultimately, that is what makes them highly uncorrelated assets. So I think we'll see fluctuations in volatility in the macro markets, and I don't think it's going to change the pattern overall for crypto. I view it as an uncorrelated asset class as well, just to be clear and agree.

So I don't think this dump had much to do with the macro. But go ahead, William. I saw you. Yeah. So I think we have too much expectations about linking what happens in the economy, inflation, interest rates, and what happens in the crypto markets. I mean, this makes for a good heated discussion, especially here. But again, this is correlation, it's not causation. Technically, of course, the charts do not look good on Bitcoin, especially because it

leads. And the SEC has reminded us the past few days that they still are not finished tightening the screws on crypto, given what they are doing with Uniswap and consensus and so on. We need to ask ourselves very, very hard, like what are the factors really that contribute to all of this? Yeah, the Fed cycles, volatile economies, corporates, countries adopting Bitcoin. There's only one Michael Saylor. There's only one country that's doing that.

So ETFs have been the only real connection. But it's still a small segment. And it's not battle tested. All of this inflow is not battle tested meaning i read this today that the average buys in those etfs are we're about for 58 000 so we are about 57 right now so this is real the real test is whether they'll stick with it or panic and get out if there is further downward pressure on Bitcoin specifically. What do we need? We need more adoption.

How do we get out of this? We need more adoption. I'm more of an adoption guy. I'm more of a usage kind of proponent. On the user side, we need more Web3 apps. We need more DeFi usage. We need more NFTs being used in useful things, meaningful ways, games, whatever. More assets being tokenized. That is real. On the financial side, we also need, of course, more traditional financial products being mimicked into crypto. And there's no shortage of creativity.

I'll end with this prediction for this afternoon, because I know all the eyes are on the Feds. Today, the dollar index, by the way, is on a relative high, 1.06. And as you know, that is a factor. As interest rates are higher, generally people gravitate towards the dollar because it's a good return. In my opinion, maybe this is contrarian. I think the Fed will be able to afford lowering the interest rates and not hiring them. I predict there might be a quarter of a point up to a half a point maximum.

Today? To spur the economy. Do you think that happens today? That's my prediction. How would you handicap that prediction? At what percent? A quarter. A quarter points.

Just to show that... I'm saying what percent chance do you think? What percent chance do you think we get a rate cut today? In my opinion, because I'm leaning towards it more than 50%. Are you crazy? I will bet you like i'll beat your whole bitcoin and we go 50 50 on it let's go even even if i'm not gonna take a bad time i'm just saying if you're saying it's an even money bet should be an easy one for you let's go

one btc no rate hikes versus uh versus no cuts today versus no cuts? I would have probably taken Vinny's side and had Andy caps. I think that validates Andy caps. There's no way Paul can cut race today. Zero chance. Like 0%. The prediction markets are 99% sure it's going to stay and 1% it's going to hike.

Yeah. Zero chance of a cut. And by the on the i've been on the hike cycle for like two months and i'm saying i and you know i didn't say when all i said was we'll see a hike before a cut and i still hold i'm still holding on that one and by the way guys like as much as you think there's no correlation there's absolutely correlation in the market between the bitcoin price right now and it's just directional if you see what's been happening in the breakdown in macro over the past couple of days and weeks, Japan, et cetera, it just takes time for these cycles and the information to flow into the market and boot things down.

I posted bubble warning on my Twitter three weeks ago at 69K. And I said, we're in crazy territory. Everyone thought I was nuts because we're going to 100. i did the same but yeah i knew vinnie was going to come for the victory lap and it's well deserved but you know yeah i i did the same but not macro related just what i was seeing in crypto right yeah yeah no no exactly and that was that was more what i was seeing crypto but but remember guys everyone misses this okay crypto is a function of global market liquidity. It's as simple as that because all the money goes into Bitcoin and then it flows down into altcoins afterwards. And Bitcoin is a risk-on asset that is dependent on market liquidity.

If you look back at 2019 and 2018 era, the bear market coincided with a steep drop in global liquidity. If you look at COVID, when Bitcoin crashed as well, that was when markets liquidity dried up. This is not a risk off asset. This is a risk on asset. And the moment you see liquidity drying up on a global basis, you're going to see Bitcoin take strain. Simple as that. And then it flows downhill from there. On short-term timeframes, possibly, but over long-term timeframes, correlation remains extremely low to the rest of the market.

It seems to be mostly unaffected long-term in terms of liquidity. We've seen very significant liquidity changes occur with no long-term effect over the four-year cycle or the overall trajectory. And the trajectory itself vastly exceeds any changes to liquidity. So I think it's true that all assets, all of them, every single one, are correlated to global liquidity and correlated to the markets over short time periods. Most of them are also correlated over longer time periods. And I think what's different about Bitcoin is that it is the exception to that rule. Over the long time, it does its own thing.

No, but hold on. So Bitcoin is now looking at a triple top formation, okay? It's basically hit the 69 to 73 range three times since 2021, okay? So I'm not sure that I fully agree with you there. We haven't had any breakouts yet. This is going back down by the looks of things. So how do not sure that I fully agree with you there. We haven't had any breakouts yet. This is going back down by the looks of things. So how do you reconcile that? It's in the same range over three years.

Yeah, so what? We've been in the same range. The pattern that we're seeing is exactly the same pattern that we've seen time and time again. We've been through now five. we're entering our fifth cycle. All of the last four cycles, by the time that you reach the halving, you were near the previous top and you stayed there for months, up and down a little bit. When you take into inflation, we still haven't reached the previous peak.

It would be very difficult to look at what we're seeing now and say that it is fundamentally different from previous cycles. So yes, it's possible that this time is different. In fact, every single cycle that we've had, people have said this time is different. And there've always been very, very good reasons to think about it. People get over-optimistic, people get over-pessimistic, but the truth is that over long time frames, Bitcoin has remained the least correlated asset in existence. Least correlated to what? Least correlated to the market,

so both bonds and the stock market. And those are the things that you're looking at. Okay. So if Powell came out today and hiked rates 50 basis points, what do you think happens to Bitcoin? Surprise hike. What do you think happens to Bitcoin? It shanks like everything else in the stock market.

Like, do you agree with that? I think, Vinny, I mean, we have to attach timeframes, and that's where the disagreement is here. Everyone knows in any black swan, which I would consider a 0.5 rate hike today, that all correlations go to one effectively, right? Fair enough. Fair enough, yeah. Agreed.

So, I mean, we have no idea what would happen, but I think anyone, even if they believe that it's an utterly uncorrelated asset over the longterm would agree that, uh, something that shocks the market like that is going to have a short term negative effect. I don't want to be Vinny the bear, but I do think the cycle has topped and I think we're going to go back down and be test some. Well, you did tell me privately that when, when we broke uh 60k in the next 10 days that was within 10 days ago you did say that would be your confirmation of the theory you had been brewing that the top could be in that doesn't mean i agree but you you very clearly said that to me privately and i will make

i i will make a bet on this uh vinny so So three or four months from now, people are going to be looking back at this period and they're going to be saying, oh, well, you know, the U.S. dollar is U.S. interest rates are being hiked. It's hurting the Japanese yen. This is creating a macro environment in which many fiat currencies are becoming more uncertain, including the yen. And that is why people are moving into Bitcoin, because we'll start to see Bitcoin rise again. We're going to be trading in a range for months with a slight uptick. Overall, my expectation is that over the coming months, we will not see massive price increases but we'll see over any three or four month period a general trend towards uh increases in prices specifically for bitcoin and possibly for the rest of the crypto markets and people will have retroactive explanations for that

including macro market explanations and they'll be you know possibly right on short timeframes, but probably wrong on longer ones. Really? Yeah. I mean, look, I get that people can be like permabulls on the long term on Bitcoin because all we've seen happen over the past 11 years is it keeps going up. But I do think that we have to pay attention

to what's happening macro in terms of regulations, compliance, KYC, AML, and the governments of the world's willingness and desire to sort of clean up the space and stomp out liquidity and stomp out trading and everything else. And I don't think you can sit there and go, oh, it's going to keep ticking up. I think if Bitcoin poses enough of a threat to the global macro situation, I think you're going to see a response. Also, I think that the Japan thing is, you know, I wouldn't say overblown, but like it's almost, in my mind, it's almost a certainty that the Fed or Treasury or one of the two are going to give them some sort of swap line to prevent them from selling their treasuries to help them prop up their currency. And so, you know, I think everyone... We're two and a half months after an ETF. We've seen courts time and time again slam down the SEC. When has there ever been a time

when governments and regulators were not pushing against miners? We're not pushing against debts. We're not pushing against ICOs. We're not pushing against wallets. It's been happening since day one. There's always been this FUD. And the market has always muddled through. Ultimately, these things haven't managed to really slow adoption in any significant way. It's certainly not more severe this time around. I disagree, but I'll let Dave take over. Dave, I think Dave wants to jump in here. What's the relationship between kyc ml and price action

that you're trying to make i'm not sure i totally understand that um so so there's a lot of trading happening on uh foreign exchanges uh that they have got very light kyc requirements and i think that you know you can just look at what's happening with the samurai wallets and wasabi wallets and stuff like that it is a concerted government effort right now to clamp down and actually scare people. Totally agree, but are samurai and wasabi driving price action? No, no, no. But the government's trying to scare people

into buying Bitcoin on some level. Everyone thinks that Bitcoin can just replace the dollar without a fight. I just don't think that's a practical path going forward. It's just not going to happen quickly anyway, even if it does happen. No, and the market's not pricing that. I mean, Vinny, we've talked about this. The market is basically pricing the odds of Bitcoin, even replacing gold as a store of value at less than 10%. And that matters. But I want to make a couple of points. First than 10%. Sure, exactly. And that matters.

But I want to make a couple points. First, you're 100% right on the swap line. The fact is, excuse my language, but there is a ton of liquidity that's going to end up sloshing into the markets. I urge everybody here to read Arthur Hayes' most recent missive, other than some of the way he characterizes the players from Yellen and otherwise. He lays out a very strong case that liquidity is going to get pushed into the market by the G7 central banks, because it pretty much has to happen, because of paper over cracks in the system.

They're expert at can-kicking. I continue to believe they will do so. I think interest rates are irrelevant in this range because we're more or less in a neutral-ish to slightly restrictive interest rate environment with more liquidity being pumped in. Fiscal is different than, is the opposite of what the monetary policy is. Monetary policy makers are wringing their hands, not able to do what they want to do, because what they want to do is pull liquidity from the system and crush speculation. But if they do that, then it literally does the opposite of what they want, which is to channel inflation into assets away from consumer goods.

And we've talked about that is a very important thing. But when you look at Japan, it's very important to understand they are an export-led economy. They can introduce capital controls. The yen being devalued, they want to defend it. And there's only one way they can defend it, and that's with injections of liquidity into the market, full stop. It's literally the only way. And that will tend to benefit risk assets, that will tend to benefit speculative assets,

but probably I think Bitcoin is at the forefront of that, because I do think that a lot of what you said, Vinny, is true and applies to a lot of the alt markets. I mean, the fact that the VC community jumped wholeheartedly into an entire spectrum of new coins with the kind of lockups in the private markets that they did, as opposed to some of the other things that they might have been able to fund is almost comical, right? Because the single biggest macro picture other than liquidity is the Bitcoin ETF. And where I disagree with you, Vinny, is that the governments of the world are sort of saying, you know what? If you can't beat them, join them. Typically, when you see a fall like this, we get an avalanche of FUD.

Oh, Bitcoin's killing the environment. Oh, Bitcoin's used for rapists and murderers and child traffickers or whatever. And it really hasn't happened this time. is because the government sees the ability to do what Ben Hunt, who runs the Epsilon theory, talks about. They're looking to co-opt it. And they're basically saying, look, let it be an escape valve, but it's small enough that it doesn't matter. I mean, Bitcoin could literally go up by a factor of 10. It could be trading at $600,000. And it still would be too small to really threaten the dollar, because we know that gold doesn't threaten the dollar. I would disagree with that, because the velocity of gold in terms

of trade and moving money around is very, very slow compared to Bitcoin. I have to run for another meeting, but I will leave you with the one thought I have on ETFs, and I've said this many, many times. It is a huge problem for me to see how much money, how much Bitcoin is going into ETFs that are effectively under the control of governments, whether it's Hong Kong, the US government, wherever else in the world. You're going to start seeing double-digit percentage of Bitcoin sitting in ETFs, government-controlled ETFs around the world. This is not a good thing for decentralized money, guys. I just don't see how this works

because they can literally just, if shit really hits the fan, they can freeze these accounts. They can do whatever they want. It is a big problem. And maybe it's not a problem in the short term, but in the long term, I'm going to call out that I think it's a red flag. Isabel? I was just going to say, to Dave's point, I do think they are going to take sort of like a, if you can't beat him, join him approach. But what they're going to go after and what they're going after with Samurai that I think is important to note here is that they're going to go after no KYC, right? They're going to go after make sure we get our cut,

you know, like, that's what they actually care about with Samurai. It's not about, you know, eliminating Bitcoin as a store of value or as an asset class. It's about making sure that, like that's what they actually care about with Samurai. It's not about, you know, eliminating Bitcoin as a store of value or as an asset class. It's about making sure that like they get theirs and that no one's evading taxes or whatever the hell is going on, that they can still control it, basically. It's not just Samurai either, right? I mean, we've obviously seen Uniswap action. Well, consensus is slightly different. There's definitely, Dave, there's been no uptick, I guess, in the FUD, like, you know, the classic FUD, China bans and electricity and for terrorists, unless you're the 12 people

that listen to Elizabeth Warren. But we have seen a major uptake in attacks on self-custody during this downtrend. Right. That's not FUD. That's very real. Like, no, it's real. That's what I'm saying. So it's a very different...

That's exactly the point I'm making. So we actually have legitimate attacks here instead of just uh silly narratives yeah and to and to vinny's point right like one of the ways they're going to do that is just like yeah making like having full control of like on ramps and off ramps that's going to be one of their tools in addition to going after these these uh you know non-kyc you know tooling infrastructure companies. Yeah, nobody here wants to see a world where your only option for exposure to Bitcoin in the United States is BlackRock. Real quick on like the government going after, it's like if they go after Uniswap, fine, Coinbase, fine.

They're going directly after these entities, fine. I think the scary part, even MetaMask, I think the scarier part would be, do they ever go after CloudFlare? Do they ever go after, you know, Google Cloud? Do they ever go after AWS to somehow block these things or talk with Apple? Right? Because once you kind of block off the internet a little bit, it does suck the lifeblood and can suck the lifeblood out because that's the UX layer of everything that we're doing here. I would take the other side of that. I think with, you know, companies that operate under a specific jurisdiction and that, you know, they're just a

corporation, there's a little bit of an element of render unto Caesar what is Caesar's. I think what's scary collectively about the Uniswap case, the MetaMask case, the Samurai case, Tornado Cash case, is that they're going after code that is not, strictly speaking, operated by a company. It's operated peer-to-peer by its users. And that type of regulation where someone publishes speech on the internet, and that is being deemed to be regulated in the same way that a bank would be, that seems more dystopian than passing laws that apply to companies that are domiciled in the same way that like a bank would be, that seems more dystopian than like passing laws that apply to companies that are, you know, domiciled in the United States. Can I just interject? Do

you think it's going to hold up? Like, I can't, I mean, I feel like there is precedence for these things, just like, you know, free code is free speech. Like, I'm just unconvinced that these attacks are actually going to work, theoretically, in like a free democracy with, you know, First Amendment, you know, freedom of speech rights. Do you have a point of view about that, Zach? Yeah, I have a very strong point of view. I'm writing an ambiguous brief for one of the cases now. Look, I really hope it doesn't stand up. I think there are strong arguments, both under existing law and then sort of backstop

constitutional arguments that could be helpful. The problem is, you know, these are not affirmative litigation cases that are being brought by people in the crypto industry that highlight the most sympathetic cases. Oftentimes, these are criminal cases that are brought by the DOJ specifically because they have the least sympathetic facts. And so like, if you take Samurai as an example, like there are two charges there, that's, you know, the money laundering charge, which is hard to prove. But if it turns out that these guys conspired with an undercover FBI agent specifically to launder criminal money, that's going to be very difficult for a judge to take them seriously. Whereas the other technical charge, this MSB charge, which is the really bad precedent for Bitcoin and crypto, I'm worried that they're just going to

plead to that at the end of the day. Will we win in court on it? I mean, I don't know, it remains to be seen. But I think that the line to draw here is that like speech is protected to the extent that the involvement of devs is just publishing code. I think that is the strongest possible case. And you know, I think it would be good to see the industry bring an affirmative case like we saw Grayscale bring for the Bitcoin ETF or like we're seeing for the ETH as not a security case. If we can find an example where the government regulates against someone who all they did was purely publish code, I feel very good about that case. I think when you look at MetaMask, when you look at Uniswap, when you look at Samurai,

these are a little bit more shades of gray where it's important to stand up to the same principle, but I'm not quite as bullish on the legal outcome. I'll let Yago... I think my favorite comment of this entire week on space is, maybe it was Friday, but I think it was Monday, Matthew Siegel from VanEck. Zach, I don't know if you heard it, to your point. He said, we're just hoping at VanEck that Zach, I don't know if you heard it. To your point, he said, we're just hoping at VanEck that Bitcoin and gold go up enough right now that we can convince Jan VanEck, my boss to sue the SEC over the Ethereum spot. Yeah, like Grayscale did, which was a pretty funny revelation publicly. But yeah, there are people who are already considering lining up for that litigation.

But I would think there's less of a thirst for it just because it's such a smaller market. Yeah, although it's existential for a lot of crypto. And then to the extent that these things encroach on individual use of Bitcoin, there are definitely things in motion to try and develop war chests to look at these litigation options. Well, listen, I mean, Bitcoiners not not generally a certain sect or cross-section of bitcoiners have celebrated government action against other coins have celebrated the sec even and others and now they're coming after bitcoin self-custody if you didn't see that coming as a bitcoiner then i don't know what to tell it right so uh go ahead uh i think overall

one of the optimistic things to remember is that the u.s judicia judicial system has for the most part proven to be very independent so there's a huge amount of political pressure right now on government agencies to prosecute crypto and i think a lot of it is that crypto is starting and Bitcoin is starting to become a partisan issue with the thrust being led by the left wing of the Democratic Party, which doesn't like the idea of unfettered free markets, doesn't like the idea of unfettered free markets, doesn't like the idea of capitalism, and is seeking to turn it into a political issue.

What as a result happens is that we've started to see people on the right begin to defend Bitcoin and defend crypto more. We've always hoped that it wouldn't become a partisan issue, but I think given the deadlock in Congress, one of the most powerful defenses is becoming a partisan issue. And at the same time, the SEC has been slapped down by the U.S. judiciary system, and judges have gone far further than we ever thought that they would in the Coinbase trial, even with Binance. If you look at Binance, it's been a slap on the wrist. So, yes, there's a huge attempt to create this chilling effect, but the government is not a monolith. The IRS are interested in taxes

and not much more. DOJ is interested in money laundering and not much more. SEC has much more of a political agenda. The judicial system has a completely different agenda and the political parties have different agendas. So no, I don't see consensus forming within the US government or across governments on exactly how to deal with crypto. And the power of crypto is that it lives like a weed in the cracks. It has for 15 years and will continue to do so and continue to grow. But I think your broader point is true. And we're going to have more luck in the courts than we've had working directly with regulators. And I've personally spent much more time working with litigators than I ever have before.

I do think there is a narrative in the crypto space that we're beating the SEC that is, it's not actually warranted. Like the Ripple case is held up as an example. I think that's an anomaly. I think that was just a weird, bad decision by a judge that's going to be overturned. The Coinbase case, there was one good win there on this sort of peer-to-peer aspect on their wallet not being a brokerage because it was a front end for DeFi. That was great.

But basically, the rest of it was a pretty clean win for the SEC. And I'm very worried about the outcome of that case and the other exchange cases. And so I think it's too early even to declare that we're making serious progress against the SEC. It's definitely an important battle to fight, and it will be a fairer fight than we've had so far, hopefully, but we're not necessarily winning. The real progress against the SEC will be when it's a different SEC. Yes. Right. Go ahead, Dave. First of all, I think Isabel's point is the point,

and everything else doesn't matter, which is they want their cut. And that is agreed to by both parties. OK, so if you want to know where the intersection of parties are, it's we want to make money. Now, apart from that, understand and see where things are going. The clear, clear, and when you look at the stablecoin bill, it's as well. I mean, they've gotten Cynthia Loomis to basically agree to only let bank-bank stablecoins be there, because what they want to be able to do is control all inflows and outflows from dollars full stop. But at the same time, with BlackRock and with what's gone on with the ETFs, and I tend to share Vinny's concern,

Bitcoin is on the cusp of becoming, quote, unapproved, in quotation, air quotes, asset. And that is interesting, right? You know, because when things are approved assets and you pump in liquidity, they don't care if it goes up. So the price action for Bitcoin, I think, from the, you know, there are tailwinds to all of this, but the lack and the attempt to try to stop self-custody, which of course is close to impossible. I mean, I've made fun of it as much as everybody else. The notion of calling a blank sheet of paper with 12 words on it, you know, a broker dealer is kind of ridiculous. But make no mistake, they want their cut and they want to make sure that if you're going to be able to spend Bitcoin, you have to

convert it to dollars first. Right. That's what's really at stake here. And they want to make sure that stable coins go through a banking system they can control. None of this is negative from a Bitcoin price action, but all of it is negative from the notion of crypto. And that brings, if John Deaton manages to get enough money to make it a serious campaign against Elizabeth Warren, that is a very big deal. If, in fact, Elizabeth Warren and all the other, the various anti-crypto forces in the Senate keep their jobs, and we have four more years of Gary Gensler running

and his equivalent appointees by Elizabeth Warren and the administration, you're going to see a very, basically a noose around all the fiat on-ramp, off-ramps, and any way of getting into and out of crypto, if not more. And so that really does matter. Amen. Yeah, I couldn't agree with you more, Dave, about the word you said. It's pretty, I like the word, they want their cat. And also, I think that they know that whatever they do, they cannot kill this industry. Even the SEC knows that they cannot kill, but they are adopting this type of male,

alpha male kind of behavior that, okay, I am here, I am the boss, you answer to me, in an attempt to control this expansion. And I think

that if we believe that someday one of the regulators will come and say, okay, hi, let's change something so that it is in favor of this crypto. Not even the crypto, anything that requires a change. The government hates change. Any kind of government. Even our personal experience with regulation have this, like

we had this project of the blockchain in renewable energy and as soon as you touch the energy regulations everybody freaks out and they try to regulate you. But they don't have any regulation about this. Regulators have these boxes and they want to put you in a box. Is it a security? Is it a commodity? Is it something? And if they cannot put you in any box, they freak out and they start doing any other means to attack you, like tax, labor, anything. anything that, and at the end of the day, how we as community can win this battle, or at least continue to progress despite of this, is with the adoption. The more people adopting this, the government will be forced to cope with these changes. That's what I wanted to say here. Anyone agree?

Do anybody think that if we get a meaningful amount of adoption or enough adoption or a certain level that all of a sudden that will be enough to push back? I mean, that sounds like revolution. Not a bad revolution. No, I don't think it's a revolution, at least to the extent that it's happening and will continue to happen. It's a very slow-moving revolution. And because it's a slow-moving, nonviolent revolution, no one is particularly galvanized at any particular moment to put a stop to it. We are seeing very significant new influx of flows into Bitcoin and crypto from the two largest markets in the world, regardless of the outcome of the regulatory scares

and question marks that we have right now, we'll continue to see significant inflows available to everyone in the US through the ETF. And that is going to allow the center of gravity for the entire space, which is Bitcoin, to continue to grow. Now, will it grow or not? You know, Vinny said no.

Other people, my sense is it almost certainly will. The other major influx of flows that we're seeing is from Asia and particularly from China. And that is a far more speculative flow at the moment and has been going a lot to new Bitcoin layer twos, to meme coins, and those are the things which have been seeing significant price action over the last few months. Those two flows alone are significant enough to provide the best marketing in the world, which is green candles. That has been the driver of adoption since day one and will continue to be the driver of adoption. And so I don't see anything fundamental that has changed and I don't see any significant new risks

that we haven't dealt with before. Nothing, no better marketing for Bitcoin than high prices, right? I mean, it is what it is. For better or for worse, William and Isabel. Yeah, but there is a yin and a yang, like a pendulum swinging, because we have to keep asking ourselves, do we deserve these high prices? Yeah, high prices make headlines. But then we go back, okay, do we deserve it? Do we deserve it? Meaning, have there been an increase in the number of users? Has there been new applications that are interesting and so on?

But definitely, if there is a criticism of the industry in the eyes of the SEC and others, is show me the apps. Show me what it's used for besides speculation. So I'm back to let's keep increasing the adoption in those applications aside from the speculatory aspect. Adoption of what? The primary adoption is happening. People get a taste of economic self-sovereignty. They get a taste of an asset that they don't need to ask anyone for permission. They can just transfer it, sell it, trade it, borrow it, lend it, do whatever they want without asking any third party or going through a broker.

People get a taste of that and they never go back. And that's because freedom itself, sovereignty, the sense of autonomy, the sense of personal empowerment that comes with owning Bitcoin, that comes with having a wallet and being able to have control over your financial future, that is the killer app for the entire space. That's not enough. It's definitely enough. That's the entire point. That's not enough. That's not a strong enough argument

in the eyes of the SEC and others. We have to see crypto in apps. Who cares about the SEC? The SEC aren't an investor, right? The SEC pushing further just makes the case for a lot of people why they need to go have self-custody. The fact that FTX collapses and Binance gets sued, these are tailwinds for self-custody. They're tailwinds for DeFi.

But DeFi and self-custody and all of these things, they're applications upon the primary killer app, which is self-sovereignty. And for the vast majority of people, that self-sovereignty can be achieved without us having to invent new use cases. Over time, the economy built around crypto will continue to grow and there will be more and more use cases. But, you know, let's not lose sight of the reason we all fell in love with it in the first place. I think that this question, adoption of what, is actually really important to dig more deeply into because the truth of the matter is that most people are not using crypto or Bitcoin specifically in a sovereign way. The vast majority of adoption, the vast majority of price action is happening through trading on centralized exchanges. That is not sovereignty. So I mean, I think it's like a nice idea. People get a taste of

sovereignty and they'll never look back. But the reality of the situation is adoption of self-custody, adoption of Bitcoin as a, Bitcoin as a payments rail, for instance, those things are very slow. It's a very, very small minority of users who are actually adopting those technologies. The vast majority of people who are using crypto, Bitcoin are just literally like trading it through centralized exchanges in a super, you know, non-sovereign way. Yeah, but I think, Isabel, you're 100% right. But I think those people are not the same people that Yago's talking about. No, do they hold the... For sure, but when we talk about adoption, right?

Like, I think that the adoption of those technologies, the reality of this is they're really slow. Like, that's unfortunate. I wish that weren't the case. I work every day to try to get more people to adopt those technologies. But that's sort of like the reality of what's going on, right? That I think we need to look at. Outside of that speculation you talked about, Isabel, I 110% agree. You know what they're actually adopting for self-sovereignty?

Is the 21 million cap? Tron. No, there is USDT on Tron. Right, right. That's what people are using. Nobody wants to hear it, but that's the quote unquote killer app of crypto so far. People don't realize that over 50% of USDT is on Tron. And that's the chain that most people in the world are using to transact fast and cheap and to get dollars to hedge themselves against their local currency, not to dip Bitcoin to hedge themselves.

I think there's two different thought classes here. One is Bitcoin, self-sovereignty,ignty and money the other is the rest of the market and i think what's kind of being talked about a little bit is there's not enough adoption of utility in the rest of the market but i think really the underlying thought process here is what can a token do right what can an nft actually do as its functionality, right? Like what is possible? And it's, it's payment rails, right? For your app, it's gated access to your app. It's, you know, an NFT that gets you into a, you know, a club or whatever else it may be. It's, it's not a massive leap forward in technology that allows for some sort of other utility to happen. It's just going to find its way into all of these apps. And if it's not a better way to interact with an app, then people

aren't going to adopt it. And so I think that's been the hard part is just understanding that all of these tokens and NFTs and everything else are just a derivative of Bitcoin that's utilized in a little bit of a different way. But I don't think we're going to get some massive killer app like this software and the internet is going to create the killer app. And the tokens are just kind of that sovereign layer, a part of it where it's like, hey, I get to take my data with me, I get to take my value with me. But we just haven't seen it yet. Well, the killer, I personally, I think that the killer app is just going to be, you know, protection against currency debasement. Like, I think over time, that use case of protecting against a currency debasement will be adopted, you know, protection against currency debasement. Like I think over time, that use case of protecting against a currency debasement will be adopted, you know, and, you know, that's, I think the best

possible killer app that this technology could be used for. But yeah, I think for the most part, like to your point, like the UX and the user experience and all these other things, it's just like, there's just not going to be a ton of adoption of a lot of these other technologies, just the reality. And if it is, it'll be incredibly slow and has been incredibly slow. Go ahead, Dave. Well, I was going to say make two points. One of them Isabel just made. I think that from a Bitcoin perspective, that is the killer app.

And, you know, any, you know, sailor and every time he talks about scarcity and money really boils down to monetarist, you know, from Milton Friedman back through Hayek, whatever. And we can talk about this chapter in verse and that bodes well for Bitcoin price action. It bodes well that the government is not really doesn't really care about that as long as they get their cut. That's great. But it is worth stating there is another killer app, it's just going to be one that's going to take the longest and that is the actual ability for a global asset to trade digitally in a way to incentivize global communities global developers all in the same network is a big deal and you

know whether it is the way equities trade worldwide, it will all go digital. I mean, I see tons of data coin routes, we process daily terabytes of market data. And we know things like we know, like, this is a stupid little example. But we know that that the incredibly regulated equity markets in every locality define tick sizes, in a way to be restrictive and restrict the way things can trade. And we know that institutions, at least using our software, can trade large cap crypto cheaper compared to size and they can equities. And the reason for this is because with economic freedom and with competitive markets creates opportunities for people. And so we know markets are going to get transformed digitally.

Just the billions of dollars that are getting spent in the U.S. right now to move from T plus two settlement to T plus one, when crypto is already T plus zero, is a big deal. So there are many, many killer apps in the financial area. I could go through stock lending and interest rate swaps. There are many, all of which are going to be fought tooth and nail by an incumbency of banks and brokers that are going to make it take a long time. But those killer apps exist. It's just you're going to be fighting against people who make money from inefficiency. When I sat in a room last week,

I gave an example that got everyone's head to nod. I explained that banks in a higher interest rate environment make a ton of money, many, many billions of dollars at something called float. What is float? Float is you send money from person A to person B, and for three days, neither person A nor person B has claim on that interest, the banks involved do. Do you think they like USDT on Tron? Of course they don't. Do you think they like efficiency? Of course not. They're going to fight it every step of the way. And so there are many killer apps in the financial world, and they're just going to get fought, but it will happen. I've got about five minutes left. I want to hear from Iago, then Isabel before we wrap.

I think based on the facts, Isabel is far too pessimistic. We've seen massive adoption of self-custody. The vast majority of Bitcoin are not held on exchanges. They're held in some form of self-custody. The majority of stablecoins and probably the vast majority of stablecoin users are using self-custody or migrating to self-custody. largest bitcoin wallet in the world is exodus which is a self-custody solution um you know with many millions of users ledger has millions of users treasurer has millions of users these are not um small parts of the industry they represent a very very significant part of the industry and um considering how much more sophistication you need how more expensive it is how you know more it is, the most terrifying day in the world is when you check if your funds in your cold wallet are still there.

Given all of those barriers, the fact that such a big part of the industry has already adopted this speaks very well to the fact that people do move up the ladder of self-sovereignty once they enter it. So yes, we've got an ETF and yes, we have centralized exchanges, but I see those primarily as gateways for people who ultimately, by and large, do migrate to self-custody. I mean, I just think that that's inaccurate. So yeah, 100%, the majority of Bitcoin, like actual Bitcoin Satoshi units is held in self custody wallets. But the majority of Bitcoin is held by like 5% of users, right? Like the number of users and the amount of Bitcoin held in self custody is completely two different metrics, like and they're, and they're, they're, they're wildly different. Like, we know, I think it's something like one in 10 Americans actually

have like own some Bitcoin in some way. Most of it's on like Cash App and Venmo and stuff like the vast majority of users don't even know what self custody is. There's some statistic that I heard that like the majority of crypto employees, like people who work at crypto companies still hold their Bitcoin on like Coinbase. Like, that is definitely just I mean, like, it's just like, I just think your facts are off. But what I will say also, and I'm, I think that your company is trying to solve for this problem. So I'm hopeful that this will change. But it's not just that people, you know, don't get the majority of users don't care or aren't educated enough to become sovereign. There's technical challenges with becoming sovereign,

right? And not just UX and UI, right? We don't, Bitcoin is not scalable to 8 billion people in a non-custodial way. Like it's not possible technically, right? So I think that these are all things that we need to remember. Like a lot of things need to change both on the education side, on the UX side, but also just on the technical side to even make it possible for 8 billion people to hold non-custodial Bitcoin. And I think, I mean, you probably know that better than anyone. And I think that, again, you're trying to solve that. But yeah, I think that that's sort of like just an important reality for us to face. Yeah, guys, I would love to continue this conversation, to be honest, for 15 minutes

over time. And I have a call and I'm the sole co-host here. Therefore, this space has to end. Sorry. I really would have loved for it to go, though, because I love these conversations. And I think that we're really getting to the heart of the matters here, which is important. And honestly, you know, it's great to have a hyperbolic title like CryptoBloodBath and what should you do?

But like everyone who's listening to these calls in general or listening to these spaces, obviously, 6,000 people right now, I think believe in this long-term and don't need an update every five minutes on what they should be doing with their portfolio. I think everybody on stage would tell you to just zoom out and chill. And then we can have these more important

fundamental conversations. Guys, that's all I got for you. Thank you so much. See you tomorrow, 10.15 a.m. Eastern Standard Time. Bye.