The Wolf Of All Streets - JPMorgan Opening Bitcoin Trading to 90M Customers | Crypto Town Hall

Episode Date: May 20, 2025

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On top of everybody, happy Tuesday and welcome to Crypto Town Hall. We do the show every single weekday, 10, 15 a.m. Eastern Standard Time. I hope that all of you are doing well. We've got quite a bit to cover today, so we're going to start to dive right into it here. The main story, JP Morgan opening Bitcoin trading to 90 million customers. Now we know that in the past, JP Morgan's wealthy clients had the ability to gain exposure to Bitcoin through their wealth management, but now opening the doors to everyone, we know that Jamie Dimon has long been a critic of the crypto industry, of Bitcoin

as an asset, but effectively bowing to the inevitable here and giving his customers what they want because he wants to make money. With Jamie Dimon and JP Morgan, it's always been a watch what I do and not what I say. JP Morgan very deep in the crypto space. They have JP Morgan Coin. They've settled tokenized real world assets on chain. So this kind of was the final move, but still really huge. We've seen Morgan Stanley unlock of late. Now we're going to be getting JP Morgan. So a lot to talk about here. Just kind of dive into the panel here. Dwayne, you're immediately over there off to my side. What do you think of this news? Hey, hey, good morning. Yeah, well, this is obviously positive news. The more institutional

participation you can get, the better. So, you know, this doesn't necessarily completely open the flood gates here because obviously US banks are still constrained with not being able to directly invest into crypto firms. But giving their customers, we're talking on the upwards of 90 million customers here, access to buying Bitcoin ETFs is definitely a step in the right direction here because you know we've seen a lot of inflows here we've seen a surge of Bitcoin inflows and that's something that I've been paying attention to so you know we've had the highest inflows I think since the beginning of the month here you know so this is definitely positive news in that respect I think overall with you know

some other things that we could take a look at, like even the confusion with the government in regards to tax cutting and some of the issues with the house, I think this is all in general bullish for Bitcoin. So if we have adoption from institutions on one side, we still have confusion in regards to what's happening with the economy. I think that's pretty positive overall, but we'll see what happens here. Yeah, Dave, I accidentally rubbed you.

I went to add you to the space and kicked you from the space. So I'm glad you found your way back in here. What do you think of this JP Morgan news? First they fight you. Dot dot dot. Exactly. You know, look, banks are the ultimate profit seekers. You know, many of us would call them rent seekers, but that's a different story.

There is no way that they were going to stand in ceremony. The only company that will stand on ceremony until they're forced kicking and screaming is Vanguard. But they've always been that way, right? So, to me, it's not that big of a deal. I think the bigger deal, there are two bigger deals. Probably the biggest deal for Bitcoin is the fact that, and then you posted it, that Trump is more or less

giving up on spending cuts in order to get his tax cuts done. That to me is huge for Bitcoin and gold and huge in every sense. I think people are just underestimating it. I also think people are completely underestimating the knock-on effects of having the stablecoin bill moving forward. I think that it's a much bigger deal than people realize because it's just not well understood.

People don't understand how accelerating and making more efficient the plumbing and the financial system will make it so much easier. Take the Bitcoin news with JP Morgan and now look let's play two or three move down the chessboard. So JP Morgan allows you to buy Bitcoin. JP Morgan doesn't want to lose all their deposits. JP Morgan now has access to stablecoin rails which can move and transfer and swap between tokenized assets very quickly. Why are people gonna keep money in checking accounts that pay nothing when if JP Morgan's competitors

are all gonna offer sweep accounts that are gonna allow them to pick an investment account, pick a checking account, and have it automatically debit the savings account when they need to make payments. The amount of money that's going to be kept sitting idle in anticipation of payments because of the risk that they won't be able to move the money is going to dramatically drop. Some of that is going to find itself into things like Bitcoin in addition to the fact that the more stable coins you have as opposed to checking accounts, the more of that will

get reinvested. The profits at least the more of that will get reinvested. You know, the profits at least from treasury will get reinvested in Bitcoin. So to me, it's a pretty bullish news, but even more so when you take it all together. Hey, Tony, you're showing to me as a listener, but I think I saw your hand go up. Are you on stage?

Yeah, I think there's a bit of a bug going on here. I got from what I see here to listen. Yeah, so guys, I have no idea who is and isn't on stage, but Tony, go ahead. At least I saw your hand go up. Yeah, for sure. I think this is significant news. Bitcoin's biggest critic. I mean, we're talking to final boss here who has bashed Bitcoin over the years is capitulating. This is significant. And, you know, it's essentially the largest domino following here. And, you know, I look at the landscape and what's coming and what we heard from Bank of America's CEO in February that once stablecoin legislation is passed, they're going to launch

their own stablecoin. So I think Jamie Dimon and the folks at JP Morgan, they see the alarm bells going on here, going off here. They're king of the hill. They're the world's largest bank. But if they don't move, they're going to lose market share. And you know, Jamie doesn't want that to happen. And then you have, of course, the United States looking to set up a strategic Bitcoin reserve. And if Jamie's going to continue to play ball with, you know, US government, with the Fed,

Treasury and so forth, and how they're plugged in, they gotta get on board or they're gonna have a blockbuster moment eventually. But Kramer said Bitcoin's going up, so aren't we doomed? Didn't say it's going up, he said he should buy it as a hedge against like monetary, against inflation or something. So yes, we're going to like 10, maybe five. Bitcoin's dead, sorry, Jim Kramer killed us once again. No, but he did kind of come around to the Bitcoin is a hedge narrative today, apparently, or yesterday, which is just unbelievable.

So yeah, a lot of people obviously pointing to his comments, but I think that this JP Morgan news was just somewhat inevitable. I mean, Gary, man, you told me before we had ETS had ETFs before we had any institutional adoption that all these guys were coming. You've been saying it to me for literally since the day we met. They're here, bro. They are absolutely here. I remember earlier today, I think Dan Hill made a comment. He said best time to buy Bitcoin was 15 years ago. And today I actually, I love Dan. I think he's got some really good points.

I actually think the absolute lowest risk adjusted entry into Bitcoin is right. The second, um, like I'm hearing these people complain about not being able to buy Bitcoin. I'm like, dude, you guys have no fucking idea what this is going to look like in a year. Like you're going to probably be at 160, 180, 200. And if you thought it was expensive today, this is going to be really cheap, man. Two trillion dollars. It's very, very impressive to have the entire world bending their knee here. My God, man.

So to me, Scott, the bigger news is the news we're not really hearing a lot of, but we're hearing little tweaks about is Saudi. It's Qatar. It's like these giants, right? They are not going to take the same process that a JP Morgan will do which is announce it Release a product these guys are buying chunks of Bitcoin right now. I'm stunned. The price is doing what it's doing right now with all the buying Yeah, I mean we've seen it very transparently from sovereign wealth fund in Abu Dhabi. I think we've had multiple, you know, four or $500 million purchases, but I agree with you. I think that's just the tip of the iceberg.

And we keep hearing these whispers, especially about Qatar, as you mentioned, Qatar, Qatar, however we're pronouncing it today. It's all coming. I wonder if any of these will be the announcements at the Bitcoin conference. Anybody have any color on what we're expected to see as the biggest announcements next week? We have a lot of politicians speaking, quite a few sovereigns, quite a few institutions. There's always a huge, huge announcement there. Gary, I wonder if that would be one of them.

I don't know, man. I hate the whole announcement thing and the convention Pump and dump. I don't I built like if you're making an announcement for the For the Bitcoin show it's a little bit like Klarna saying or XRP saying they've done another deal with some ancient dinosaur bank That has zero revenue attached to it. It's a partnership deal. We'll hear a bunch of those. Bro, show me the money. Show me the revenue. Show me what you're actually doing. Otherwise, you wouldn't have waited till May the 27th to launch your idea. I've seen this for like 20 years. Visa MasterCard love doing this. It's a payments thing. I would pay zero attention to it.

It's also just different now, right? I mean, in 2021 when Naid Boukeli, you know, when they did the announcement with Jack Mahler of El Salvador making Bitcoin legal tender, that was at a time when you never seen anything like that. Even that same announcement today has minimal impact, in my opinion, just because it, which is good because the asset class has matured and there's no unicorn announcements left to be made. Yeah. Then you brought the convention up.

I will tell you, I will predict most big corners are not going to like this convention. I mean, Peter Schiff speaking. Yeah. There's going to be a lot of people speaking that the big corners don't even want to hear. It's becoming a big, big show now. So it'll be interesting. Yeah. It's, it's a little, little, little bit more Coachella than a conference, but I

think that, uh, you know, for the mainstream that that serves the industry probably. Well, uh, Ryan and then I'm gonna tell you, I think you had your hand up, but go Ryan and then I'm gonna tell you. Yeah, it's, I had to be the naysayer, but guys, I don't see the price going to this 200, 250, 300 this cycle. And I mean, I hope I'm wrong. Like six months from now, I really hope I'm wrong. And hey, Coachella, Bitcoin or Vegas this year, like, I hope they just blow the roof

off and like all the announcements and the price goes sky high. But I just, I just don't see the price like topping like 130 or 140 per cycle. I just, I just don't see it. Well, the conference, even with the big increase from here, man, it's nothing wrong with that. I mean, people should, sorry, Scott, but people like Ryan, I, like, I'm just saying, it just seems like an awful lot of players with monster amounts of money and they have very solid hands that we could see this get to 120, 130. That's a 30% move. That's awesome. Especially after below 20.

But I think a lot of these big moves are happening OTC. So they don't like a lot of these big moves of crypto going into the nation states and stuff. They're not moving the general markets because like people are doing these OTC deals specifically not to move the general markets. Dude, dude, stop that narrative. Please do. I can't take it. Look, I ran a firm that literally trades, algorithmically trades this stuff.

We know all the market makers. There is no such thing as this OTC phantom liquidity. What there is are OTC brokers are smart. They use intelligent trading methods that aggregate liquidity. When derivatives are cheap, they'll use derivatives and move it into spot later. But the fact is, there's no magic bullet here of OTC liquidity. What you're seeing and have been seeing for months

are OG crypto folks selling Bitcoin to finance their life and to take some money off the table and people that I always joke that look more like me, although I don't look necessarily as old as I am, but the fact is it's where boomers are buying it and new investors are buying it and sovereign funds are buying it. And eventually that supply will run out. The supply dynamic, the demand dynamic is not definitively not changed by trading OTC. This is not a hill I need to die on because I know I'm right about it. I just told you two plus two equals four.

Please, dear God, if a market maker tells you that they have magic liquidity, all that means is that there's a seller that's talked to them that is willing to trade with them and that they may have orders to trade across other markets. But OTC brokers use sophisticated tools to trade, but they don't manufacture liquidity.

I'm sorry, this PSA was brought to you by an angry boomer. Hey, Ryan. Ryan, I'm curious what metrics or signals are you using, Elliott Way, Fibonacci, as far as your price target over that range? I'm not... like Dave said, Dave is like experienced in capital markets and all this stuff.

I'm literally looking at mining profitability and looking at how fast we can produce the hardware versus the difficulty of the network versus how we are rely on this equipment. And if the price goes to half a million dollars, you know, $600,000, whatever, it means all the publicly traded miners are instantly some of the most profitable companies on the face of the planet. And we have a crunch. I don't think they'd be the most profitable companies, but they for once would be profitable.

Correct. Yeah. It was a grand statement. They'd be very profitable. When you have some of these miners where they're minting Bitcoin for 70 to $80,000 a coin, their margins are very, very nice. What is the average cost of mining a Bitcoin right now? Do you know?

I haven't seen in a while. I don't know if the average is at this point. I know some of the miners that are running around two cents a kilowatt hour, three cents a kilowatt hour, with low OPEX are probably in the 80,000 range. I mean, that's profitable, but still in the danger zone, depending on what price action does, right? the the I was just gonna say. Dave, you can feel free if you see someone by the way at the hand and I'm clearly not calling them. Just go ahead and take over. I'm not sure Scott can hear me. I can hear you. I just couldn't see you. Okay. Yeah. Yeah, I was gonna say when it comes to the JP Morgan news, I do think it is significant

news but I think also the timing of it is important because typically with these markets, if we was in like the euphoria stage for Bitcoin and this news come out, I would say that's a top signal. If you think back to like 2017 when we was at 20K and they announced the Bitcoin futures trading news, that marked the top for BTC. The fact that this news is out now when we're in a bit of a weird range

and a weird part of the cycle. I do see it being bullish and significant. So I don't think it is a top signal at all. I think this is probably going to boost the price of Bitcoin in the midterm to long term. But yeah, I just wanted to point out these kinds of news I'm very skeptical about depending on the time that the news is released. So right now I think it is a bullish news event.

But yeah, if it was like later on in this year and JP Morgan announced that I would be selling my BTC. Yeah, I did something this morning Scott, which was interesting. People were, you know, and it was funny because, you know, John Haar from Swann meant something different than the way it was taken out of context by somebody else's post. I was talking about comparing now to 2021. So I just went back and looked at funding rates and etc. And it's really stark. In 2021, when we were at 60K, and it was clear euphoria, and you know that I criticized Mike

and others for picking that as their time start, the funding rate to buy, to get long Bitcoin was approaching and in many cases exceeding 100% annual. At the same time, T-bills back then were paying zero. So it was just an incredible amount of speculation. It's almost unfathomable that you could have weeks of time that people were willing to pay that much to do it. Today, right now, and it has been this way for weeks, months actually, the average funding rate is roughly 5.5% per year and T-bills are 4 a quarter, meaning you're only paying a percent more as an individual speculator than the risk-free rate. That's insanely low and effectively there's zero speculation.

So make of this what you will. I make of this, it basically shows me that to say that we don't have euphoria may be a great grand understatement. Usually you see this sort of stuff when you're consolidating in a range, you know, when everyone thinks the market's dead. And you know, I like to be contrarian, as I've said many times. So to me, that's an extremely important signal. Yeah, interesting, Dave. Another one that kind of crossed the tape today that is in line with

that is that we're seeing the basis trade come back, right? We talked about outflows for quite a while with, I bet specifically, but ETFs in general. Now we're seeing once again, massive inflows and the basis trade is up to 9%. I think it was four in April. So we're seeing this kind of historic run once again of inflows into the ETFs. More than 50% of that is going into BlackRock, which makes a lot of sense.

They have options available on BlackRock, and well, it's BlackRock. And a 9% basically guaranteed yield by simply shorting the futures and buying the ETF. Yeah, that might have been at a point yesterday, but right now I'm staring at it. And right now the June futures are offered. It's 105,575 and spot is 104,725.

So I mean, it's not the spot, the May future is 104,9 something or other. So it's like 600 bucks. I can do that math off of 100,000. That's not 9%. That's, you know, that's under 6%. I'm assuming it's a longer dated future. Right. But the volume is in right now is the roll period right now. It's made a June. June is the highest volume and that's the one I'm looking at. Yeah, I'll pull up the article. It might have spiked yesterday. I wasn't watching. So I don't know. I'm just looking at it right now.

Go ahead while I look this up. Yeah, I wanted to get back to the mining thing, and I think this relates to the current price and what you guys are looking at in the futures. Scott, you said, hey, what are miners' costs? I just grok this thing, so don't hold me responsible. But it looks close. Marathon Digital, the estimates are $166,000 all in. Now I'm asking all in on cost of capital, everything, right?

Her Bitcoin? Yep. All in costs. The average cost is $47,000 to mine, $69,000 for the Bitcoin, but with depreciation and all that, you roll everything in. Riot platforms, Q1 2025, $131,300. Now, I've seen this before, okay, when producers are underperforming relative to their cost base and Wall Street starts buying the paper or the underlying, which I think is what's happening. They're like, shit, I'll buy 104. The producers can't make it.

Riot Platforms, 90 to 110,000. CleanSpark's the best at 99 average, 80 to $100,000 cost over Q1 $100,000 cost over Q1 2025, excuse me, 2025 in Toto. And then Iris or Iron Energy is 87,000 with three year depreciation estimate 70 to 90,000. 101,573. So I think it's a little high. I don't think it's that I don't think it's that far off. Even I mean, Gary, 85 Marshall's a minor. Oh yeah. I forgot in here. I mean, Gary, you and I talked about this last year at the Dallas conference, but yeah, I mean, I don't think it's that far off. And Ryan, you probably know maybe a little bit more than me, but look,

the there's a stark difference between these PubCo guys who are just tapping ATMs left and right, diluting everybody stick taking cash and then just buying equipment that they can do accelerated depreciation on. So there's that side of it, but there's a growing mid scale size. There's a good example. You guys probably seen this guy online, his name's Bob Burnett. The way he runs is the way this sector is growing. It's smaller pockets of mining. This is the way I mine in Africa.

Community impact based. I can tell you my cost is well under $40,000. The guys that are pushing a lot of cash rate, my concern is how sustainable is this? Because these guys have gotten away with murder, diluting their investors and they're now trading under nav effectively are pretty close to now no multiple. So what's the point of even being public at that point? And climbing, right?

Exactly. And so I don't know how sustainable this stuff is. You know, there are larger private guys like the guys from Electron. They're doing a good job. But the overwhelming majority are, if not, way underwater or definitely underwater. And there is no end in sight. They've been growing at all costs. Yeah. So you say growing at all costs.

Listen, we saw a lot of them literally by the most expensive miners possible at the dead top of the last bull market, right? So not geniuses clearly. But so how are they continuing to exist? Are you saying that literally it's like tax efficiency by depreciating the equipment and then raising these convertible notes like sailor? I mean, what's the business that that's how it's happening. Yeah. So the, you know, the for a long time in mining, you would get punished for

making bad business choices at every halving cycle. But now these guys were able to tap an ATM at the right time. And it's become a game where they're not getting punished for these bad business moves as quickly as people used to be because they have cash to kind of float along. And now everybody's turned into this micro strategy kind of hybrid vehicle where we don't really have to be good at mining Bitcoin because we've got 10,000 Bitcoin on the balance sheet. And as long as Bitcoin keeps running, then we're good. But I don't know how long this kind of lasts because at some point the music's going to stop. They got to be selling everything then. I mean, I would say that's my biggest concern going into this next wave is miners, pubcos

have been, and look, I consult for almost everybody that you listen to. And I can tell you right now, they all run suboptimal deployment period in historic, but that's not their game. Their game is playing this public market stuff. But yeah, they're, they're, they're, they're doing a different game. And I don't even consider a miners at this point. Ryan and then I'm a tail. Yeah.

I'm glad Marshall jumped in. He's exactly right. So I ran the calculus in the background real fast. So miners, if highly optimized, low electricity rates can mine Bitcoin between 25,000 and 30,000 a coin with the latest hardware. That's just electricity costs and I'm just running it in my garage. When you get to like Bob Burnett and his size he has you know OpEx layered on top of that but Marshall's dead on exactly right like

it's it's the public markets game and if we're gonna see the next big pullback or crash in Bitcoin it might just happen with the publicly traded miners. Yeah, can you hear me now? I can. All right. I went to Macro Micro. I don't think this is precise either. I definitely trust Marshall since he's got his hands in the mix here, but it's looking at like between 90 and 105,000 average costs. So, I mean, it is not insignificant. It makes me wonder if we're going to start to see Bitcoin mining be sort of re-migrated to cheap power sources, if we're going to see China start to become a bigger, more dominant player in the space as a result of all of the energy output that they're delivering.

But I think that to the conversation of like, can it actually hit 140,000, 150,000? I think kind of to Dave's point, the demand just doesn't show any signs of slowing down. And the demand is coming from such a large multitude of sources from around the world. And every day we get more news of demand, we get more onboarding effects from JP Morgan or other countries embracing crypto and Bitcoin. It's definitely looking like how long can we get these sorts of headlines that are so dramatic.

I think that that's a valid question. I think as the headlines are to slow down, that will start to sort of mark the talk. But I don't see any signs of demand starting to slip and outstrip supply here. I think supply constraints just keep continuing. Marshall, what do you think then, you kind of jumped in after we were discussing it, but Ryan had, I guess, a lower kind of bull market target than some others as a result of what he's seeing in the miners. How much do you think that this will affect price moving forward? How much do you think that this will affect price moving forward? Oh, man, I don't know. I stopped trying to read the tea leaves long ago. I mean, look, there is, it's just nice to not be called a drug dealer these days, to

be honest with you. The, you know, the for a long time, the narrative was, oh, this is just for nerds. It's really cool to be able to have meetings with heads of state. And, you know, and so at that point, it's it's gone well beyond my wildest dreams. And at this point, you know, I wouldn't be surprised if they hit 200 and I wouldn't be surprised if they hit 50. Yeah, that's my general approach. Never be surprised. But I mean, Gary, I mean, you look at this on the public markets, not that this is now the topic we're intending to discuss, but I mean, Gary, I mean, you look at this on the public markets, not that this is now the topic we're intending to discuss, but I mean, you look at any of these and say,

yeah, I need to own mining stocks. Well I do own mining stocks. I've made a 50% return. It's been a horrible investment. I should have just bought Bitcoin, but I tried to be all clever and shit. Up leveraged Bitcoin is what we viewed it as. Yeah, but it's not leverage Bitcoin. It's grossly inefficient Bitcoin.

This is like being a farmer. Why would you want to go to the bank, draw out a note to own some land? Your parents might have given it to you. Then you have to go to the bank and draw out a note to own some land. Your parents might've given it to you. Then you have to go to the bank and borrow money. I mean, fucking borrow money to buy the seed and buy the fertilizer and buy the water and then buy the equipment or rent the equipment and then hire people to only have corn prices go into the shitter. And you get to sell it a loss of 13 percent only to be able

to enjoy two out of 10 years of some kind of bull run that you were not able to expect. And in fact, the insects probably took over your fucking acreage that year and you didn't even enjoy it. And your neighbor made all the money. I mean, mining is a horrific business. And I think what Bitcoin mining shows you is that trying to do it on scale is actually too expensive. And that micro farming is going to be the only survivor of this because they can literally source energy at zero. If you're paying three cents a kilowatt, you're not going to survive Bitcoin. I do not believe I've said this since day one, you must control the land and the energy

and it has to sit on your balance sheet such that it is not a cost and that you can hold the underlying commodity on your balance sheet, just like an oil producer does. Wow. Marshall and Ryan, you guys were just hitting the emojis hard on that. So I guess Marshall, you agree there? Yeah, look, man, I big big credit to Gary. Gary's put in a ton of work over the past couple years that I've known him to really study this. He hit the nail on the head. This is the most brutal, capitalistic endeavor, anything I've personally done. And,

you know, Gary's done a lot more business than I have. So like, did it change? It wasn't always that way, right? Well, it started being this way in 2013, just being so hard with new hardware coming out, left, right and center. But the people who haven't adapted their models and strategies, they're getting smoked and the people who have who are doing literally what Gary just said, people are making deals with people who own the power infrastructure and, and where it can sit on your balance sheet and you don't have a floor or maybe a ceiling of power price and allows you to custody the Bitcoin.

That's the, that's, that's the current paradigm that people should be doing. That smaller scale impact focused, you know, all the stuff we're doing in Africa is just that, you know, it's a community endeavor and it's wildly profitable, but I mean, it is like running on a treadmill made out of sandpaper. You don't do it right. You're going to get smoked. Well, I got you guys with analogies today, just question. I just been here on this like I between area Marshall, this would be one of the most entertaining spaces

that we have been on in a while. I need a reader, right? Like entertaining like a cartoon or or entertaining like good education. I mean, I don't know if this is a compliment or a slap in the face, Marshall. No, both. Both. I say this has been educational and entertaining. Hey, look, all press is good press, Gary.

Just make sure they spell our name right. There you go. But let me reiterate, if an individual buys one of the latest miners right now and just plugs it in and runs it with basically no op-ac, they're just paying electricity, they're minting Bitcoin for about $30,000 a coin. If you try to scale that, and this is to Marshall's point, if you try to scale that, to Gary's point, it does not scale well unless you are the power producer or partnered with the power producer. And this is where we're going to

see nation states getting involved in mining. This is where we're going to see nation states getting involved in mining pools, and they will outperform any publicly traded miner. So I think over the next several years, there is going to be a huge shift to nation states controlling their own power infrastructure and mining infrastructure. And it's going to parallel their AI infrastructure. It'll be the same, right? The same infrastructure. Yep. Yeah. You got to imagine that. I totally agree with that, by the way.

Yeah. How is a publicly traded miner going to compete with a mission state that can mine with free energy, basically, and using public resources to do so? Seems like the future is pretty clear. For better or for worse, I guess. It's actually a little mind-boggling, because it's more complicated than that. The sovereigns have an edge over somebody trying to buy third-party energy, and that

is most of the energy the sovereign is going to be producing with Bitcoin or producing Bitcoin isn't actually hitting the system right now. Like literally, it's stranded. It's fucking trapped. It has nowhere to go. Alaska, Dakotas, Saudi Arabia, all over the place. Russia. Why would somebody pay a dollar fifty to transport gas that's worth three fifty? They'll just fucking put a GENCO right there on the platform and mine Bitcoin. And remember, energy doesn't have constant demand. It's up and down, up and down, up and down. This fits so many scenarios for the

sovereign, so much better than the grid used to be able to turn up and down that, quite frankly, the miners aren't really benefiting from. The miners are basically a phone call from a call option that the electric company has. They're not actually able to exploit the greatest margin. And if they are, they're going to get clocked because they're trading the most violent commodity in the world, which is electricity. So we've already seen one mine or have to write down a whole quarter because he fucked up his hedge. Or is that? I must miss it. I can't remember. It was last year sometime.

I mean, of course, scientific had the bankruptcy scare. Yeah, no, this was this was a big minor. This is one of the top four miners that had to just rewrite it was I can't remember which one was iron or one of the ones I own actually well for somebody just they missed their numbers You know, they they missed a happens. Yeah, he does Yeah one other story I wanted to make sure that we highlight because I thought that this was really interesting is the Potential acquisition of circle and apparently ripple it's being reported coinbase has not confirmed

But I'll just read the headline circles reportedly and talks with Coinbase and Ripple for a potential acquisition according to banking and private equity sources. Ripple's $4-5 billion bid, which was likely to include XRP and cash, was rejected. Coinbase CEO Brian Armstrong stated there's nothing to announce at this time regarding a potential deal. This seems like a massive news considering Circle is kind of one of the next up for a public listing and going public. And this would obviously be the private sale. And knowing

that Ripple is making a bid here against Coinbase when Coinbase, I don't know the numbers, but doesn't Coinbase make as much or more money from USDC as Circle? Can anybody, I don't want to speak out of turn, but isn't that effectively true? Does anybody know? Well, then I'm gonna just speak out of turn. But what do we make of a potential private deal here for USDC, especially in the context

of stable coin legislation hitting, I mean, what does this mean for the market? Amitay, go ahead. Yeah, I don't actually necessarily have an answer for that. I have a bigger mean for the market? Amit, go ahead. Yeah, I don't actually necessarily have an answer for that. I have a bigger question for the rest of the panel, which is why would Circle be looking for an exit and an acquisition here? I mean, exactly to your point that they're on the heels of going public. We've got stablecoin legislation going live. Stablecoin's moved over $6 trillion in the first quarter of this year. I mean, that's just a staggering number. So I guess I just am like kind of scratching my head as to why this would even be a consideration when they had the ability to print with interest rates and their reserves.

Yeah, I have just a big looming question as to why this would occur. I think I saw something recently and don't quote me on this, but their revenue over the years has not been great with their operating costs and so forth. I think it has something to do with that, but I think I'm gonna take it to your point. This is the year that things could really change for them as stablecoin legislation gets passed. Matthew, you were about to jump in. I know you've been watching this. Yeah, no, it just feels kind of like Circle might be an engine without a car in this respect, right? So they need an organization and a company to really scale all their efforts from a stablecoin perspective. And they don't really want to do it in reverse. Like Circle is not going to become an exchange. It's not going to become a payment processor in the same sense that Ripple might be, or a custodian like Coinbase might be. So it makes a ton of sense

that they would put themselves up for some sale opportunity and or IPO if they really need to, if they really need the cash as Tony pointed out. But I think if anything, people should really be focused on the fact that the stable coin business is still probably one of the best businesses on earth at the moment in terms of just the opportunity. And as we see the genius bill get pushed further and further into potential law, there's just so much opportunity here.

So it's a great, great way for companies like Ripple and Coinbase to continue making acquisitions and continue to bolster themselves and try to even corner the market from a stable coin perspective and take as much as they can away from Tether, which is really the other contender here in this case. I mean, there is also, listen, this is a story that's being reported. I haven't heard an actual comment from any of the three parties. So this could be literally Ripple just saying, hey, we'll give you four to $5 billion for Circle and not Circle actually soliciting bids. So I think there could be some nuance there, Amateo, to answer your point. It's possible they

didn't go out and say, hey, we're for sale. And we know that Ripple has already launched their own stablecoin, excuse me. And so this would probably just be a move further in that direction for them and they're flush with cash. Gary, go ahead. Yeah. Matthew and then Gary, yeah, either one. Sorry, I just wanted to, so the reason they would do this is the IPO was slotted to do 4 billion, 4 to 5 billion.

And then Ripple came in and said, we'll give you 4 billion. Now it's 20. Look, I think Ripple, if they could raise the money, they will pay whatever they have to survive. I 100% agree with that. Now Coinbase, I don't know how much Coinbase funding is available, but when you look at the people, there's been $1.4 billion invested in Circle, like, and you look at the people that are owning it, like you could easily see them get out for 18 to 20 billion. It's a 15X.

I mean, it's a great trade for them. Yeah. And even if Ripple, I mean, this is just conjecture, but even if Ripple bought Coinbase, wouldn't Coinbase still profit from it since they already do? I think they bought Circle. If Ripple bought Circle, Coinbase profits massively from Circle, so it's still going to be a win for Coinbase. Coinbase isn't the loser.

Yeah, so there's no real reason for them to outbid themselves on something that's going to be wildly profitable for them either way. Well, Scott, they should outbid for this, though. To me, Coinbase wins this. While the regulators allow them to do it, they buy everything they can. This is going to be the biggest M&A cycle in crypto history. This is what could extend the cycle, I think, to the gentleman's point about, hey, we're not going to see $200,000 Bitcoin. If you see a bunch of merger activity, which I think we're going to see, I think that could

change. That could accelerate things faster than we're expecting. Coinbase just fought there a bit for almost $3 billion, right? Or was it over $2.9 something? I can't remember the number now. $2.9, I think, was the ballpark. I mean, that's the biggest acquisition in history. So you don't have to look far for evidence of what you're saying. Sorry, Scott, just one quick point about your question about, or your note that Circle didn't say they were necessarily up for sale. I would make the argument that anybody going through the IPO process is technically saying they're for sale just in a different way.

Yeah, definitely entertaining all comers because at that point, it's just about raising capital. So if anything, it's that's a floor, right? Yeah, that's right. That's a floor for you. Yeah, exactly right. Like a stocking horse. I'm a tail. Go ahead. If Coinbase was to move forward with this, do we think that there's any concerns for antitrust that come down the line as they sort of corner the market and all these products? We're obviously seeing that with Google and this man. I gotta tell you, like, like, like to me, Coinbase could quadruple its size. They're still like, so small compared to JP Morgan. So I think they get away with a lot right now. And there's no regulator that's going to block them from like, this is the time you do it, right?

Like if I was on their board, I'd be fucking buy everything you can. If you're going to use your balance sheet, do it now because you're going to have bigger players behind you. Once they catch on, they're going to want a piece of the action and they'll pay whatever they've got to me. Four billion, eight billion, it's not really any big numbers anymore. Yeah, Gary, the more I think about it, as you talk about it, the mergers and acquisitions, it's just going to be insane. Along with the actual public listings. I mean,

everybody's going to try to jump on securing the bag in the next six months to a year. Because nothing, you know, especially if we start to have the threat of like regime change or, you know, like losing the House, the Senate. I think everybody views right now as the time to strike while the iron's hot to really kind of get the big payoff that they've been waiting for in this industry for so long. Now I see kind of as moving on from this topic, this is going to be a great one for all you guys who we were talking about mining and everything. I see David Carvalho joined. What's up, man?

How are you? I'm glad you joined. Hey, cheers, guys. Pleasure to be here. Awesome conversation. Yeah. So David and I, I was going to have you jump in in general. So David and I had a talk, think we're publishing it this week. And you, you scared the shit out of me so bad that I had to have you on Crypto Town Hall too. I didn't even try, man. too. I didn't even try man. So listen, so I actually I see Neorus on the stage as well, but maybe you could like tell us what you do because you know I've been one of those people, I told you this when we met that was kind of dismissive of the threat of quantum for a very long time and you made me see the light otherwise. So maybe you could talk about

like kind of your background in cybersecurity, what you do and why I have you on stage. Yeah, cheers. So, you know, tell the truth. It's not just you, it's, you know, you and everybody else and nation sites and so on. It seems that every year it's like 50% closer and it's not getting to a point where it's like

smaller increments of 50%. So I'll tell you a little bit about myself. So my name is David Cavalli. and it's not getting to a point where it's like smaller increments of 50%. So I'll tell you a little bit about myself. So my name is David Cavalli. I'm the CEO and founder of Norwich Brokoll. We are a native Web 3 infrastructure layer that acts also as a meta-layer so it can embrace other layers that's designed to secure the various stacks of blockchain from pure infrastructure all the way to transaction level against future quantum threats. So it's a completely revamp of the fundamental backbone of cryptography of current change and also of the infrastructure that supports them and allows them to take a little bit about my background.

So my background is in cryptography. I'm a cryptographer. I published a number of papers on post-quantum cryptography with universities in both sizes of the Atlantic and also with the IEEE Foundation and also in other areas related to cyber, mainly around nation-state related cyber and critical infrastructure. I've been global chief of security for a number of multi-billion dollar companies in Europe and also in the UK. I've been also running a cyber SWAT team that deals with nation state level events, mainly cyber war related for close to 15 years. And been advising a group of countries under the NATO umbrella and European Union umbrella on cyber war, cyber terrorism, cyber espionage, and other areas like this data protection

and stuff like that. Currently, we are in charge of Norse protocols that we have created under an ethos that was very real-world focus. We have a number of NATO-level use cases and mandates from former NATO leaders that also part of the project in order to really use decentralization as a source of post-quantum backed truth and trust about everything that runs everywhere from hardware to software improving its state in a decentralized environment. The reason I was dismissive of it before, which is kind of an immature excuse now, I think about it more, was always that, well, if Bitcoin screwed because of quantum computing,

imagine the nuclear codes and the DOJ and the banks and literally everything else. My attitude was we have much bigger problems. But this is actually, you and I have spoken, this is a legitimate problem for Bitcoin and for crypto in general, correct? Yeah, it's a global security risk. There's no two ways about it. The impact is going to be on global systems. Blockchain is one of them. Web3 is not special necessarily. It uses elliptica-based cryptography, which is in the back of everything it does. I would say the backbone of digital infrastructure that as I see it in the future is Web3. But we need to be ready for whatever comes next. So right now, as I mentioned,

beyond blockchains, critical infrastructure, banking, healthcare, telecoms, you name it, all it's on the verge of being compromised. And as you mentioned, the nuclear codes and insert troubling data point here. So nation states are very aware of this. They all have like 20, 30 plans that include quantum or quantum related defense measures, mainly around quantum, say for quantum, post quantum cryptographic standards and kind of like, you know, step by step implementations. There's a number of governments that view quantum technology as a strategic priority for them offensively, of course. But there is an urgent, let's say, drive for quantum safe solutions. Even the US has passed a number of pieces of legislation that publicly mandate

this to 2030 for all agencies and environments that deal with critical infrastructure. Is that soon enough? So that's on the public side. In private, it's probably a lot earlier. So we are very much embedded with cyber commands here in Europe and also with other environments that are running a lot faster. So I assume in the other side, the Atlantic, it's the same. I mean, even today, there was just kind of like sort of like

quote, quote, breaking news of like a 504 qubit quantum computer in China. And I want to remind everybody that theoretically, and this is with Shor's algorithm, so there might be others that we don't know about that are better. You only need 1,500 qubits to break Bitcoin cryptography as it stands, or any other cryptography that's existing in any chain because they're all 32 bytes space or 256 bits long. Okay, so my question, I guess,

here since I happened to bring you to Crypto Town Hall, we know that this question's maybe relevant to all technology, but you've talked about obviously being quantum resistant or post-quantum. How do you prepare for that? If you're an existing project app, staying, you know, layer one, can you retrofit effectively what already exists

to be quantum resistant? Or do you have to start building something that's quantum safe from the ground up? You have both, right? Yeah. Yeah, that's a pretty good question. And, you know, obviously a lot of people have been asking this and this, you know, we had a conversation also with the Ethereum Foundation on the same problem. So as it stands right now, post-quantum cryptographic algorithms are not compatible at all with current blockchain use elliptic cryptography algorithms. So most of the work that we have done and the research that we have done and the papers we have published, et cetera, were in the direction of actually creating,

let's say, a meta-layer. And that's really what Norrish protocol is. Meta-layer creating, let's say, a meta layer. And that's really what Norris protocol is. Metal layer overlay, let's say, that doesn't require any hard forks to be implemented and for you to rehash and remake every transaction that you have made since the beginning of time. Just imagine that with DeFi, it would be crazy. But yeah, think of Norris protocol as a solution to this problem. So it's an overlay or a meta layer that runs alongside existing blockchains. It doesn't alter underlying protocols, doesn't change any consensus. There's no need for hard forks. It doesn't function

like a typical L2 or L1. It observes instead and manages the security logic around the chain without forcing structural modifications and then it uplifts the transactions under a post-quantum context. It basically ends up resigning the broadcasting that exists at post-quantum level from existing broadcasters, let's say, and that brings that back to the chain again. And that's on the transaction side of things, because actually, one of the riskiest parts right now for blockchain from a quantum risk perspective are the transactions themselves, because the hashes are public and

quantum computers can also directly attack hashes, not just cryptography, but also hashing. So unlike public, private, private keys, let's say that our private hashes are actually public. So with the quantum computer, you can actually attack it, break it, do double spend or broadcast it again, since it has been signed already with a different address of destination or a different amount, which basically bypasses the whole principle of consensus. So you don't need to dominate the consensus, just need to dominate the cryptography. That's why it's pretty scary. On the other side of things, the focus

on scalability and speed right now by change is, I think, what we believe is going to continue to happen. But the objective for us to integrate with them is for them, as you say, to integrate with us and outflow the security to us. So that's interesting. That sort of solves the trilemma to some degree, right? Because we always are for those who don't know, right? There's the blockchain trilemma, which is speed and speed and cheap, fast and cheap usually comes at the expense of security. So you can basically get the party and offer the

security. Is that fair to say? Absolutely fair to say so. Cheap and fast as you say. So speed and scalability and the last vertical is security, which is probably the hardest one computationally to achieve and in a provable way. So that projects can actually prioritize performance and user growth, increasing the confidence on the space. But the way that we have achieved this is, we have done that on top of a custom PPFT Ethereum virtual compatible space. So the integration with Ethereum based chains is really, really fast. So we're talking like 24, 48 hours.

For other chains, it's also possible just needs more custom work, even if they are not. But I would say, as you said, kind of like echoing that a little bit in a different way, we remove the heavy lifting of these post-quantum security approaches that would need hard works, allowing you to build faster, safer, more efficiently, while preserving the immutability that, you know, blockchains are, you know, it's the backbone of everything. Quantum technology threatens that immutability that promise, let's say, unless we act now and we migrate. So, we're in the process of this being reality. I don't mean the quantum side,

but actually the quantum resistant, the quantum proofing side. Where are you in that process? I know that you were test netting, like it's a test net, main net, how many transactions, and where are you at providing this to other chains effectively? Yeah, actually, I could give you the live numbers. So we have had a crazy, quote, quote, main net slash test net. It's kind of like our first, I'll call it a beta mainnet, let's say, because it's our own cryptographic standard. It's our own consensus. It's our own everything, our own infrastructure.

But we have done more than 60 million post-quantum transactions already, two months, actually almost 70 million. We have more than 2.1 million wallets currently on the environment in about 862,000 nodes. And because of the use case that we have, it's actually looking at, you know, cyber risks at the same time, we ended up mitigating about 353 million threats between all these nodes, because they all violate each other. That's an insane number. What kind of threats are those?

I didn't even know that there were 200, 300 million plus cyber threats on this level. Yeah, it is actually the same kind of level that you would see from major companies in cybersecurity space, but in a decentralized context. What we have done is actually we have created the first decentralized infrastructure from centralized spaces. So we just grabbed people's computers and their browsers and so on. We made actually, it's one of the use cases that we made public. We have more than 30 use cases that we built on top of our post-quantum chain.

But the one that we have built is what we call a decentralized browser security node. So you download it to your browser. It acts as a kind of like a mini node, a light node on your browser that then analyzes every page that you visit and checks if there's like the anonymizing scripts there that will de-anonymize you or steal your crypto information or your credit card information or sell your data or spread malware or ransomware or whatever. And then that gets blacklisted and shared with every other participant. So it's kind of like a hive mind of trust really, that's as a consequence of this infrastructure being created.

And those are the things that actually got blocked on this specific use case. But this was just to give people a taste of how we can actually, with this NATO-backed principle or from former NATO leaders, let's say, under these mandates, build these infrastructures in the real world that leverage decentralization in a post-quantum context. So it's ready for the future for any sort of use case. This is just a very direct kind of like cyber infrastructure use case, but you can apply this to any validator group, any piece of hardware.

So you can actually, for the first time, prove state for everything that runs everywhere at the same time under decentralized consensus. Okay, what have I missed here? Because I know we just cooked through like 15 minutes, but how is this available to the public? How can people participate, follow, get involved? Yeah, man. So right now, of course, our public cell is live. We actually just went into public cell today, which is super exciting. People can participate and take a chunk of these and have the capability to join us as we create other more exciting things like post-quantum

peer-to-peer VPNs and things on top of our cryptography and on top of our chain. They will be able to stake and have lifetime ownership of it and a number of other things. So people can go to our website norris.4Call.com or Norris.com and just click go to public sale and participate. And they can also still participate in our quote, quote testnet or let's say mainnet beta and go to our Explorer and see post quantum hashes, which if you never saw one, you can go there and see them on the transactions. And really participate however they would like. We're more than happy to have people join in.

Super excited with the community that we created in such a short time. Definitely didn't expect that on our side. Do you have like two more minutes? So I'm just curious, like, as this becomes a bigger threat, do you think that what you're building, what others will build can actually fully protect systems from this? Or is it going to be, is there a situation where it has to be solved now and you have to adopt the technology now or you're going to be in big trouble? Yeah, it's unfortunately the second option.

So it's almost irrelevant if in the next year, because for example, I talk to cyber commands all the time, we partner with them and also with agencies, etc. There was a very well-known cryptographer from the NSA that I was speaking to, a former one, that believes it's going to be the next 12 months that that quote, quote Q day is going to start breaking things. Of course, we would never know if that happened because the track doctor that would be leveraging it wouldn't make itself known. Right? Things probably looked like hacks, but they weren't. So it's almost irrelevant when that happens. If

it's like next year or tomorrow, you need to be post quantum now because your data is in transit on the internet and it's next year or tomorrow, you need to be post-quantum now because your data is in transit on the internet and it's visible. Your hashes, your signatures, your keys, and they can actually be derived from one another. They're being harvested in what's called Harvest Now the Crypt Later by mainly nation states right now, I would say, and agencies that have interest in shaking the status quo and harvesting and keeping them in their hard drives. And there's nothing you can do, I mean, as soon as that happens, and that's happening right now. So the only thing you can do is actually prepare yourself now, be post-mantem now, so that you don't get your wallet raped later or anything

else that actually you are protecting behind those keys because it's the same for the whole global economy and everything that matters in the world really. That's a secret. Crazy. Crazy. Everybody there, I encourage you to follow David, obviously, if you want more insight in this, but Niora's protocol is on stage as well so I would say follow them, check out everything that they're doing. David, we're gonna go ahead and wrap. Any final thoughts before I let you go?

Yeah, first of all, I would like to thank you guys for the good questions and the time here and always great discussions in this group. Obviously, there's a massive market need. We're currently the only in production post-continent infrastructure in operation. There's, I think, a maximum upside potential for people to come in. There's real-world validation from NATO level standards to former Microsoft presidents that are part of the team and things like that. Some of the people that created the internet, et cetera, just come to our website, take a look. And yeah, man. So guys, stay safe, stay sovereign and stay quantum and we'll talk next time.

Thank you so much, man. I really appreciate it. Thank you to everybody else. Obviously, it was a speaker today. It was a great, unintended conversation on mining. I actually learned quite a bit. I had no idea it was such a bad business. Otherwise give everyone a follow. We'll see you guys tomorrow, 10, 15 a.m. Eastern Standard Time for Crypto Town Hall. Thanks, David. Thanks, panel.

Thank you all of you for listening. Have a great day. Cheers, all.