The Wolf Of All Streets - Making Sense of Crypto with Mike Dudas, Founder of The Block

Episode Date: January 5, 2021

Mike Dudas spent years helping major companies like Disney, Google, and Venmo with growth and business development. It was during his professional career that his interest in crypto began to grow. Mike recognized that the crypto space lacked an unbiased data, news, and information hub for retailers, businesses, startups, and hedge funds. After assembling a team of experts from around the crypto world, The Block was born and became arguably the best newsletter and data aggregator in the space. Now thousands of curious interdisciplinarians look to The Block for their expertise, guidance and analysis.  Mike Dudas and Scott Melker further discuss, the need for unbiased research, simplifying crypto for the masses, the Bloomberg Terminal, governments as customers, fintech arriving to crypto, competing with PayPal, Facebook’s crypto product, who will be the next Michael Saylor, regulating stablecoins like banks, dumb regulation threatening crypto, burning and depreciating treasuries, the dollar as crypto’s reserve currency and more. --- If you enjoyed this conversation, share it with your colleagues & friends, rate, review, and subscribe.This podcast is presented by BlockWorks Group. For exclusive content and events that provide insights into the crypto and blockchain space, visit them at: https://www.blockworksgroup.io

What is up, everybody? I'm Scott Melker, and this is the Wolf of All Streets podcast. Today's guest is the founder of The Block, the leading media and information brand in the blockchain and cryptocurrency ecosystem with arguably the best newsletter in the space, which obviously pains me to say since I have a newsletter. Mike spent years driving in essential roles around the development of Disney, Google, Venmo, and other major companies. It was his curiosity that led him to transition towards crypto, where now he is the managing director of G2M Ventures, helping major players in fintech and traditional finance enter into the crypto space. With his background, it's safe to say that Mike Dudas is one of the most intelligent, well-researched people in crypto, so I can't wait to dive deep into his thoughts

on institutional adoption and the future of this space in general. So Mike, thanks so much for coming on. Yeah, thank you for having me. It's a pleasure. Of course. So before we get into the questions, once again, you're listening to the Wolf of Wall Streets podcast, which airs twice a week. And we talk to your favorite personalities from the worlds of Bitcoin, finance, trading, art, music, sports, politics. The show is powered by Blockworks Group, a media company with over 20 podcasts in their network. Check them out at blockworksgroup.io. And if you like the podcast, follow me on Twitter, check out my website, join my newsletter. You can do both those things at thewolfofallstreets.io. So now to get into it, Mike, I was stalking your LinkedIn pretty hard and couldn't help but notice

that your top skills were persuasive emailing and functional tweeting. So do you have any hot tips on how to do those things? Because they sound like very useful life skills. Yes. So what's interesting is I would say that the functional tweeting became dysfunctional actually over the past couple of years as I entered the crypto space, it's virtually impossible to spend a considerable amount of time productively and engage with other folks on a regular basis and stay sort of in a really positive, you know, exciting, positive environment. And particularly if you have strong viewpoints and opinions. So I would say it's become a bit more dysfunctional. And frankly, it was much better. I was a better functional tweeter when I was in more sort of boring, bland industries and ecosystems,

you know, not sexy parts of FinTech. And when you're trying to sort of drum up interest and excitement on the persuasive emailing, you know it it's such a critical part of uh sales both enterprise sales primarily enterprise sales is what i've been doing for the past decade and sort of the email is everything but i think we've also seen that shift you know that's probably a four-year-old thing that i added in my linkedin profile and i think we've seen you know email transition to text messages and persuasive, again, tweets and direct messages. I mean, basically any channel that you can get, Telegram, et cetera, to connect to somebody. So I need to update that.

Yeah, you're serious. Maybe the most marketable life skill now to be able to deliver a concise message in under 200 characters. It really has changed. And I frankly have overdone it and you've probably seen it. So I think to do it, I think you do a good job of staying on message and frankly, the frequency

not being just too overwhelming. So I think if you reveal too much about your thinking process out loud, I mean, if you do it and you're a genius like SBF, you know, it's wonderful. Yeah, he's incredible. Yeah, or Tarun. But if you're like me and you're just sort of sp SBF, you know, it's one thing. Yeah, he's incredible. Yeah, or Tarun. But if you're like me and you're just sort of spitting out, you know,

every thought that's in your head and every article link, it can get a little cloudy. Indeed. So to dig into what's more important here, obviously, you have an extensive resume in FinTech and beyond, as we sort of dug into there in the introduction. But you decided to take all those skills and start the block. Unless I'm missing a space, unless I'm missing something there in the transition, but at least outwardly it appears you were like,

we need to start providing better information, doing better research. What made you make that decision and head into this space? So I've been interested in cryptocurrency, digital assets, whatever you want to call it, but really it was Bitcoin in 2013 when I became interested. And I was actually working at Braintree and we were considering adding crypto payments, Bitcoin payments to the gateway so that customers of some of our biggest merchants at Braintree, Uber, Airbnb, and others could use Bitcoin to pay. The idea was lower transit action costs than credit cards. And this is back when sort of the idea of P2P payments and of low cost payments via Bitcoin was pretty exciting. So we had conversations with Coinbase.

Unfortunately, PayPal purchased Braintree while that process was happening, and that product never got rolled out. I said unfortunately. It might have actually been fortunately because what's proven out over the last five, six years is that folks just haven't at scale to date wanted to pay with a highly volatile asset. I think the narrative around what Bitcoin is has changed from digital you know, digital payments to something more like a store of value. We could talk more about whether that's changed. I think that has changed with the advent of stable coins. But certainly, that's what got me excited. When I looked to enter the ecosystem full time in 2018, it was sort of beginning of 2018, late 2017. It was a peak. I'm not an engineer.

I'm not a financial markets person. So I looked at where I thought I could add value. And I'm somebody who's typically worked on bringing early stage financial technology to let's call it 50 to 100x the audience of those early adopters. So I felt like with all this rolling information, competing protocols, multidisciplinary knowledge required to understand digital assets and cryptocurrencies, that it was really important to have a trustworthy, independent research and media source, knowing that most of the industry sources were owned by very wealthy people with strong stakes, whether it be in Ethereum, Jalubin, and Decrypt, whether it be in various silver and Coindesk, and felt like an independent source was important. And that's sort of borne itself out with our popularity

over the past few years. I really did want to reach a retail audience when I started this in 2018, but that audience hasn't really materialized at scale. And so the block has primarily become a institutional insider B2B publication, although that is changing over the last, you know, call it four to six months. I want to dig into what you just said. First of all, I need to say that I felt like the block has been around since 2014, 15, 16. So it's crazy to me that it only started in 2018 because you've become such a leading brand in the space happen at scale, which I find fascinating because, you know, I guess from the outside looking in, it seems like that's where just people on crypto Twitter go to get their information, but it sounds like it's not really the case. Yeah. So our original tagline was crypto simplified. And I should probably clarify, we probably originally, I thought, hey, we'd have,

you know, 5, 10 million, you know, monthly users and page views. And what we actually found is we want to create and we are creating a sustainable business while producing, you know, high quality information. So in order to do that, I guess when I say retail, I kind of mean the person on Robin Hood or, you know, who's trading and where we've really found our sweet spot is to power traders and folks who understand market structure like yourselves, all the way through to, you know, really significantly large institutions. You know, the Fidelities of the World backed Gemini, folks like that. And we realize that you need a mixed and you see a lot of this right now, a lot of debate about tech and media and crypto is one small part of that. But what we recognize is you need a mixed model. So a model of research-driven subscriptions and ad-supported

sponsorships, supported partner-supported journalism and media. And they're really complementary to one another, particularly when you're focused in what is an emerging and rapidly growing niche. Is the goal to eventually become the same sort of scale or size as a Bloomberg offering is to traditional markets and to normal markets, something that has increased velocity of information right on time, exactly what you need to know. And, you know, I mean, a Bloomberg terminal obviously is tens of thousands of dollars. So we're not talking about that per se, but sort of that for your average

trader. Yeah, that's the evolution of the product and the brand. So, you know, we started with, and I think what most people remember is the news, as you mentioned, you know, Frank Shaparo and Steven and it really started that in 2018. And to get quick attention, even Larry Cermak who's incredible researcher and leads our research team now was, was doing a bit of news and supporting the news team. But, you know, to get to, and so we feel like it's a very emergent, it's an emergent asset class that will over time continue to eat larger

and larger parts of the financial markets. You're seeing that happen. You know, I think it's what you want to talk about, which is institutions is starting to participate in different ways. And yeah. And so from a product perspective, we've moved from news only to news plus research to news plus research plus data. You're continuing to layer in those things. So now we have a data dashboard that isn't necessarily like we're not ourselves necessarily creating those data points, but there are fantastic companies, you know, like coin metrics and many others, Paradigm Research.

And we're pulling information from them, aggregating. And then what we're trying to do is put insights on top of that and put context around it. We feel like that's the phase or the stage that we're at. And frankly, people don't necessarily know what the right data points are that are driving value today. So we try to, you to, we don't necessarily recommend particularly protocols, particular tokens,

but we try to put context around what's happening. And then we think over time it will evolve where many more people will have the sophistication to use the raw data themselves to make their own decisions

and their own inferences. But I think the set of folks who can do that reliably today and make money consistently is probably in the low thousands. And so, you know, I think there's probably 50,000 people who think they can do that, but that's not true. Oh, I agree. And I would probably say it's even more skewed towards failure. So we can glean from that, that obviously the business has evolved from, like you said, to news all the way through to data.

So I guess that then begs the point, or begs the question, who is using that data, right? You say that at the end of the day, you want people to be able to interpret themselves, but you wouldn't be creating that data unless there are much larger players that are looking at it and trying to make decisions based on it. Yeah, precisely. So there's a really interesting mix. And because we've been fortunate enough to build a real business model, we're able to support a research and journalism team that is really robust and actually broad and deep. So in other words, we have some engineers who can go really deep on protocol dynamics,

technical changes to protocols. And there's an audience for that, which is typically, you know, startups or investors who are looking, you know, so startups that are looking, hey, what should I build? What's a technical trend that I should follow? There are investors who are saying, hey, what companies or trends, you know, should I invest in? But then we also have folks looking at market structure. Larry, you know, does quite a bit of that. Ryan Todd on our team, for example, does a different set of market structure.

So he looks at publicly traded companies, things like Square and Silvergate and the implications around what they're doing. MicroStrategy takes a pretty strong macroeconomic view on what's happening in the crypto space. So we get hedge funds interested in that, larger scale investors. We have some folks who are doing sort of blockchain-y type research. And then others who are doing actual financial market infrastructure.

So who's doing custody well, who's doing crypto as a platform, crypto security, blockchain analysis, things like that. And the audience there is really interesting, right? We have governments as customers, local, federal. And then we have a whole other section where we're looking at the humongous report on central bank digital currencies. So again, not only are regulators interested in that, but also companies who want to understand how do we fit in.

So I can't speak to specific customers, but you know folks who are issuing private money. And we talk to those folks all day and their customers. Not only of the public research that we do that you get with the subscription, but conversations and one-on-ones with our research team. It's interesting. You just said that governments are customers. So clearly we're seeing a major shift from what drove the market in 2017 to an 18 to what's happening in 2020. So I want to really drill into that. Why is a government a customer and what are they looking at here? Is it from a regulatory perspective trying to figure out what it is, or is it because governments may actually want to invest in some way as a reserve, like we've seen companies do?

What are governments looking to do here? Right now, we're seeing they're at the knowledge accumulation phase. And not only knowledge accumulation, but hey, how is the research that we're doing being synthesized by some of the leading minds, right? So it's almost like action reaction. Hey, BIS puts out something. Okay, well, how do some of the leading minds, right? So it's almost like action-reaction. Hey, BIS puts out something. Okay, well, how do some of the smartest folks out there then interpret that and put that into their workflows? So we're seeing that on the institutional side and call it stablecoin issuers and folks of that nature

will do quite a bit, like, again, a massive, you know, stablecoin report around, you know, the implications of sort of issuing KYC, highly regulated money, versus, you know, all the other different types of coins. And so what happens is, you know, we get people join not only for our research, but for the discussions around it. So, you know, we get people join not only for our research, but for the discussions around it. So, you know, we have a Slack group, we have, and you know, this from your own, from your own business, it's a lot of those, you know, private, deeper conversations, where folks are accumulating knowledge, but it's all spurred the way that you build this business is it's all spurred by, youred by putting out some strong viewpoints,

research and analysis. And it can't be only one of those things. I've seen, you know, a lot of businesses built around, let's just say, just opinion, right? Or just analysis. And if you're not doing original research and context setting and description. So, you know, when to get back really quickly to your question about central bank digital currencies, you know, we did a really robust review, you know, sort of across, I think, 15 to 20 different countries or entities, you know, the EU and said, Hey, here's what they're doing. Here's how they're thinking about structuring it. Here's the timeline. And so the benchmarking there got folks very interested in what other folks were doing. And then you become that sort of central, that hub of inbound and then outbound synthesis. It's interesting. I used to

always make the argument that crypto is a trader driven market, right? It was completely speculative. So it was the only market we can look at a chart and reliably perhaps have a chance to trade it. But I've argued more recently, certainly in the last few months, that this market is no longer driven by traders, right? We're seeing spot kind of buying lead ahead of leverage, but also the narrative has just changed. We see these huge buys from institutions. So why do you think institutions are all of a sudden finally so interested? Because we've been hearing about it for years. They're coming, they're coming, you know? Yeah, so you know markets, I think, better than I do.

So I can't necessarily speak deeply to institutional mentality, but what the smartest people, again, our researchers who are speaking with these folks, the data companies that are helping them make the case, you know, whether it be to their LPs or their shareholders to make these decisions. One is it's been done a few times now, right? We have public companies who have taken an extremely strong stand. We have some of the most successful historically macro hedge fund folks to the world who have come out and said, Hey, you know, I actually believe that in a pretty significant asset class here where store

value is, is exceptionally important. You know, as a particular property and investment allocation as part of a portfolio. You know, we have something new and emergent that just won't die. And, you know, these are simple things. Like, you don't overthink it. If you follow, for example, what Michael Saylor is saying, if you follow what any of the hedge fund luminaries are saying, it's basic stuff that, you know, if you're on crypto Twitter, people have been reciting it like a mantra for five years. It's just actually coming true now, right? And it's coming true in a non-hysterical way, in a methodical way, and in a relentless way.

And so, and it's happening across multiple fronts. So you have on the institutional side, the biggest one we haven't talked about yet is PayPal giving the, not only giving the sort of stamp of approval to cryptocurrency and making it available to their customers on the consumer side, but also saying we are committed to this being a form of money that folks can spend at our 25 million plus merchants. Next year is humongous. And then not only stopping there, but Dan Shulman getting out there and saying, look, we've done this in a supremely compliant way. We've done it with Paxos. We've got the stamp of approval from New York State.

They're going all in. And so that's just, it doesn't get, in my mind, more powerful than that on sort of the commercial side. So you've got that, then you've got folks. So you've got the narrative of like sort of payments, the biggest FinTech in the East. I'm sorry. Yeah. In the West, you know, really going all in as a fast follower. And they're doing as a fast follower because Square did it, right? Square is eating their lunch in terms of, you know, cash apps growing faster than PayPal. And Bitcoin's a big part of the story. It's sexy. They market it exceptionally well. And so, you know, they've done it the right way. They started with a closed Bitcoin product and then they opened it up so that you can, you know, basically move your Bitcoin out of the cash app, you know, if you'd like to. So obviously PayPal and Robinhood have limited products now where it all happens, you know, it's kind of an IOU. Yeah, exactly. It will evolve over time. So that's been a big driver to your point about spot driving this. There's

just so much demand right now. And, you know, what happens obviously when there's an incredible amount of demand, more demand for the asset than, you know, sort of new supply in terms of what's being mined and price goes up. It's a really exciting time. At the same time, I'm not getting the hysterical stuff that I got in 2017 from my family being like, Hey, I need to FOMO into that. And I'm seeing, you know, very reasonable people say to me, okay, the time horizon is different. I don't want to

trade this, Dudas. But, you know, do you think this is something that I should sort of just set it and forget it, dollar cost average in and hold? So the whole mindset, that being said, so that's the positive. It's not what got me into crypto, you know, in 2013, which was, you know, again, peer to peer money, this idea of low cost payments, let's totally transform global digital internet money. I do still think that that's critical to Bitcoin's, you know, development over the next decade. And I actually deeply hope that the PayPal, you know, allowing folks to spend Bitcoin at 26 million merchants plays a part in that. I think it will, by the way,

because as you expose people who own $100 or $200 worth and it becomes 150 or it goes up 50%, I think that type of person might be willing to actually spend it. So it's going to be really, really interesting to watch. I've always found it interesting though. And you mentioned sort of the difference now between Bitcoin and stable coins, which is worth digging into because when you were talking about it in 2013, you were just talking about Bitcoin and it's not the best, you know, peer to peer money, even though that's the name,

you know, the white paper peer to peer cash. But now we have stable coins. Aren't stable coins just a better product than PayPal itself? They are a, so they're a better product than the way the PayPal network works today. In other words, PayPal's effectively sitting here as a rentier, like just effectively taking a rate because of the network that they've built out. That's a take rate. That's just a higher than, than Mark. I mean, it is market because you know, the PayPal button is on tons of sites. The good news is stable coins are coming along and this is an area that I'm extremely passionate about. And most likely the focus of the next business that I build coming along an incredibly wonderful time. You may see sort of the memes and the jokes where somebody will show a mobile checkout page and it has like eight buttons. It's like shop pay and

Amazon pay and Google and Apple pay and all this. Point being, it's going to get really competitive here. And so here's what stable coins have the potential to bring. One is a set of rails that are much lower cost to move money, not just for payments, but for sending money from here to another country. They have not only consumer implications, but also business implications, right? I'm a contractor now. When I get paid by some of the companies that I work with, I'm paying just insane chase, transfer fees, this, that, and the other thing. Stable coins have the potential. They're not at scale today. It's not easy to move them from one

endpoint to another today. But I think it's going to change really, really quickly. And the reason is because you have so many brands competing with PayPal for your attention and for my attention. And in order to make merchants happy, in order to make consumers happy, you're going to have to add more value than the sort of convenience of PayPal. Right. And how do you do that? More value on the consumer side, perhaps higher yield on my stable coin balance. I don't know how sustainable the yields are that we're seeing today. They're probably not sustainable, but certainly higher than 0.2%, right? Higher than nothing. Yeah, higher than nothing. It's great. On my business account at Chase, I'm getting nothing. I mean, it's nuts. So, you know, some benefit there. Get rid of some of these fees for moving money internationally.

And then I think that on the merchant side, you're going to be able to start to give some rebates and some relief to merchants who do accept stable coins. And this is where it's going to be interesting to watch what PayPal does. And frankly, I'm excited to see which ones of the sort of neobanks really pick up. I'm excited to see which is of the sort of neobanks really pick up. I'm excited to see which is the first big branded neobank to offer, you know, sort of this new visa, you know, USDC, let's just call it a little money, you know, money account over here, right?

Take a thousand bucks, put it in, get a yield. That's maybe 6% can move that money around via the visa network to spend it. If I want. I mean, I think that's going to be really attractive when paired with an existing strong brand, call it a chime or something like that. Somebody's going to do that. They're going to do it. I mean, we're already seeing huge banks in Europe and abroad, even like within the last week or two, starting to say that they're going to offer, you know, these services to some degree. And, you know, the model has now been proven by the Voyagers and BlockFis and Celsiuses of the world that you can, you know, safely park your money and gain yield. So whoever can combine, sort of, as you said, you have to be a bit of everything in your business. One of these banks is going to have to step in and be everything for this business.

And I think this is like three to six months, not three to six years at this point. Precisely. Yeah. I delete all my tweets because I've had so much trauma from tweet attacks for years. But I've said the same thing. I think, you know, right now, some of what we're talking about sounds implausible. But you saw it look, Tether went from what, like 2 billion to 20 billion in total volume, or in total, you know, outstanding stable dollars. This year, you're going to see USDC, I think, or sort of the aggregate non-tether KYC stable coins. And certainly if LIBER comes into play, which is a little bit more of, again, of a perhaps a private money, depending on what they back it with. We're not really sure what that's going to look like when it comes out of the gate. But massive, massive numbers of these crypto dollars out in the market. And yeah, it's going to be really, really exciting to see.

You know, I think people think that, for example, Novi, Facebook's wallet is just going to be the de facto winner. And I am just so, so, so excited to see, you know, what entrepreneurs kind of wrap Libra into their products, or Diem, I'm sorry, wrap USDC in, but have a lot more choice and less strategy tax than Facebook and how they approach this. And just less like reputational friction, right? Exactly. Precise. We're already seeing Libra rebrand to DM as you touched on just to separate themselves from Facebook. So I don't

think it's a far jump to believe that people are going to be a bit resistant to a Facebook wallet as their core choice, right? I mean, people just don't want to mess with Facebook and giving Facebook control over your money is a pretty big jump. So it's a huge leap. The thing, however, is that, so it's more of an issue for the folks who are talking about and even know that DM exists today than the, let's just call it, you know, a billion plus folks

who might actually just see it on WhatsApp or, or see, you know, see an ad for in Facebook or Instagram to download the DM will, is the DM wallet. It would be the Novi wallet with, with DM in it. Yeah. Those folks will just say, Hey, and I'm, you know, Facebook gives me five, 10 bucks of it probably at some point. I don't know that those folks really care. Yeah, I agree. I mean, just going back to the PayPal thing, I just still find it so interesting that they're, I mean, Jack has obviously forced their hand with square a that's all.

That's what it is. Right. I mean, Jack has obviously forced their hand with square A. That's all, that's what it is. Right. I mean, I don't view it as some like corporate ethos that this is the future. I just feel like they have to be in it. Same thing you're, I'm sure you're seeing from institution, all of a sudden, every single institution has a research report on Bitcoin, not because they care about Bitcoin, because their customers are asking about Bitcoin. And so they have to do it, right? Unquestionably, unquestionably. But the best companies in the world are participating in cryptocurrency to get back to, you know, when I think of institutions, again, not being somebody who came from Wall Street,

a lot of my research team gets excited about the Fidelity's entering and all the other wonderful institutions. I get so excited about Visa, right? Like we talked about partnering with USDC and just so many of the other institutions that are partnering for payments and actual real interesting consumer use cases. Right. So we have all these use cases and then we have the obvious, if you touch on the store of value, the micro strategy that I'm putting my money into this because my buying power of the dollar is dying and holding cash is basically just lighting our treasury on fire. So we saw micro strategy do it. We've seen Square do it. We're seeing some other smaller companies. What does it take to see the big boys do it? At what point can we expect

an Apple or a Facebook or an Amazon or a Google to start talking about, you know, this as a treasury asset? Yeah. So I would be really surprised if any of those companies, I mean, their treasuries are growing by leaps and bounds from, you know, in many cases, you know, sort of natural monopolies and specific markets and or just insane competitive advantages that can continue to compound. So I don't necessarily see tech companies having a need. And they've proven, for example, that they can redeploy capital better.

Like they don't store value, right? So I would say tech companies are like the last type of, the best tech companies, the ones that you just highlighted. You know, their cost of capital, I mean, they reinvest their capital in building just monster businesses. And today the market is rewarding them not with profit, even if they don't have profits in reinvesting in the top line. So it would be companies, it's like, I could, it would be great to see,

sort of IBM, for example. They remind me of micro strategy in a lot of ways where the core business isn't supremely, you know, exciting. It's a consulting and largely a services and consulting driven, you know, data business. Okay. IBM, you know, blockchain is critical to the future. Well, what's the best application of blockchain? You know, money, money in all its forms. Okay. Park some of your treasury and Bitcoin and put your money where your mouth is. So that would be a more likely one. Do I, I'm. So that would be a more likely one. I'm sorry, that would be a, I could see that being a more compelling strategy. I mean, if you get one company of that scale to put treasury in and to actually move the needle,

you know, there you're talking about, you know, billions of dollars and that gets really interesting and it's not implausible. So I don't know when that's going to happen. And I'm not in the habit of making those wild predictions um you've been on twitter long enough to know that uh you can't make wild predictions because somebody will take back seven years and uh make make a oh michael zahler right people are pulling up his 2013 tweet saying that Bitcoin was basically dead. And God forbid somebody evolved in seven years or even seven weeks. I did the dummy thing. You know, like when he, when he, I, you know, his particular style of talking about Bitcoin is, it's interesting.

It's not like mine, but it's, I kind of mocked it when it came out and I said, Oh no, another one of these guys. But you know, I've listened a lot more and that was too quick a judgment. And it was a, it was a bad judgment on my part. When you listen, he does a very sophisticated understanding of, you know, this being, you know, what the longterm trend is here. And so he, he's, he's clearly bright and he's actually bright enough to talk in a very, a lot of these folks are, you know, you know,

pomp takes a lot of heat, but he's smart enough to talk in a very specific, focused, consistent way that appeals to a lot of people about the thing that he cares about. And so, and it works and it's been positive. And, you know, I think you need those folks and you need the skeptics as well, you know, to keep folks grounded. Smart people have strong opinions loosely held, right? You're allowed to change.

Well, you're allowed to change sometimes. You don't just walk the party line. I've been cast from, you know, I started as a Bitcoin maxi and got into that cult and, you know, then got turned off by the fact that to be part of that cult, you had to agree with basically every talking point. And I got really interested in Ethereum being around really brilliant people like Teo Leibovitz and some of the builders that he was working with and got to know. And you get really excited. And if you're into technology, it's hard not to start to get as excited about Ethereum and a handful of the other layer one chains out there and what's happening in DeFi.

And you're going to offend folks as you start to get excited about things that they think are a threat. So you just have to deal with it. Yeah. It's interesting. I think that there's even an argument going back to the Apples and Googles,

the FANG stocks, that those are stores of value themselves, right? So they don't need to put their treasury in a store of value if people view buying their stock as a store of value in itself. Because, right? So they don't need to put their treasury in a store of value if people view buying their stock as a store of value in itself. And then the second argument is that they're just way too big and Bitcoin's way too small. I mean, if Apple wanted to put 1% of their treasury in Bitcoin, they would own every Bitcoin. They would, exactly. And to your point, though, indexes, as you know, have become such a critical

part of people's portfolio that it's literally, you park your money there, you don't think about it. And as the tech companies become ever larger parts of those indexes, yeah, to your point, they really are effectively a store of value. That's interesting. Now we have the, I mean, we're hearing about the S&P creating an index product. And I think that also is going to be extremely popular in the coming six months to years. That's something you guys are seeing on your end as well. Yeah. I'm not sure I understood that question exactly. Well, the SMP is working, I know, on an index product that will be traded.

Oh, yes, yes, yes. And we're seeing obviously a lot of private ones. And that's a huge movement actually in the smaller projects on DeFi is to create these index products. But is that something that you see as a huge evolution here that we're going to start to see? Yeah. Yeah. I mean, just the fact that you see so many of these index products, for example, a bitwise launches, there's trades way above, you know,

trades in a massive premium. There's more demand for these products than, you know, the actual fundamentals can sort of secure and be backed. And so people are very, very hungry for index products. They want exposure. This is extremely complex stuff. DeFi, for example, is extremely complex. So full disclosure, one of my clients that I'm consulting with is a company called 21Shares. They have another brand name called immune AMUN phenomenal company. I'm a small investor have known the founder Haney for years. They have a set of ETPs, you know, very healthy business regulated in Switzerland. That's doing well, but they're launching a set of what you just talked

about DeFi tokens that will represent different strategies, right? Indexes. And I won't pump it here too hard, but, you know, it could be similar to sort of Wi-Fi looking for, you know, the best yield. If I deposit a thousand dollars, you know, we'll find the best yield across a bunch of different pools. And then other ones like, hey, here's a coin that gives you exposure to all of the different proof of stake protocols, as well as, you know, instead of just owning the tokens, like you wouldn't a centralized exchange, you can participate in the economics of those proof of stake protocols and our additional coins or tokens and fees. So, you know, you're going to see these more sophisticated products, but they're going to be autopilot because honestly, I can't, I don't have

the time, the know-how, the access. I live in New York. I can't even trade that. Yeah. I can't, I don't have the time, the know-how, the access. I live in New York. I can't even trade. Yeah, I can't do this stuff. And so that to me is really promising. We've been talking a lot about institutions. I think those products will start by appealing to somebody just above your casual retail cash app user, you know, maybe again, you know, me, and then it may rise actually up to, you know, institutional allocations. I'm actually really curious to see what institutions will start to allocate to after, you know, BTC. I saw somebody tweet out today, you know, who's going to be the Michael Saylor of ETH. You know, Jill

Lubin obviously is that today. It's probably going to be a technologist. It'd be really interesting. Actually, it would be really interesting to see if one of the tech companies, and again, maybe not one of the five that we named at the top, but a different tech company, Ethereum is much more, I think, of a technology plus money play. Makes ETH part of a treasury asset

or something like that. That'd be interesting. Yeah, and we've seen Grayscale recently sort of come out and say, listen, we're getting a lot more interest in our Ethereum products now even than our Bitcoin products. And I mean, they're buying more of both than are being mined right this year. Talk about supply side shock. But I do agree with you that I think that there's a lot of people who are behind the scenes looking at Ethereum much more seriously than before, and maybe even more so

than Bitcoin. Yes. And I don't know if they're looking at it on, so on the, on that 10 year horizon. And you can see it in the narrative. I think most folks who are deep in the Ethereum ecosystem realize that they're saying, Hey, I think there's a, you know, there's a 4X, 5X, 10X on ETH here in the very near term. And maybe there is. I don't know. I mean, to me, that might be speculative, like the call it Bitcoin-led mania of 2017.

Bitcoin to a million. Yeah, right. But there's just so much development happening and actual real use cases on Ethereum that are starting to emerge at significant scale. You know, tokens that tokens that rely on Ethereum. I wouldn't say as a reserve asset, but rely on smart contracts, DeFi and NFTs, real use cases, real money being transacted. And it's extremely bullish, obviously, for Ethereum in the near term. Essentially what you said about the index is because your average person is just never going to understand DeFi, right?

Not a chance. I mean, I don't want to yield farming. And when you get really deep into it, that's why these automated products that are based on indexes are so interesting. By the way, not only that. Oh, I interrupted you. Go ahead. No, please. Yeah. So, I mean, today we just saw, and I don't want to pick on

Ucarp or Nexus Mutual, but if the actual person who's created the DeFi insurance protocol is hacked for eight and a half million bucks, man, via MetaMask, like we got some issues here. This is not something that the average person's going to be playing with uh or understanding or understanding how to secure it today

nor should they i mean honestly they absolutely absolutely should not so um yeah i think custodial or index based or other ways to get exposure uh it's it's how this is going to happen both on the institutional side as well you mean then theparadigm, dragonfly, three arrows institutional side, people who do other things, they're going to allocate not by doing it directly. I mean, you're in New York, arguably the most heavily regulated and difficult place on planet Earth to be in crypto. I can even use BlockFi and it's like right down the road, you know? Yeah. I mean, do you think that regulation is still, I don't want to say the biggest threat, but the biggest hurdle to adoption?

And what do you see regulators potentially focusing on in the coming months and years? Yeah. So I think dumb regulation is, is the biggest threat, meaning literally not understanding, uh, the technology, not understanding, uh, how this type of money cryptocurrencies are different, um, than, you know, sovereign currency, how the assets are held, how they're issued, you know, in the case of stable coins. And so misapplying regulation paradigms, the easiest sort of mental model I have is like, when you think about how regulators have looked at the gig economy, and you have like full-time workers and then you have contractors. There's probably like a third regulatory tranche that should be like the gig worker, you know, regulation that has elements of both. That's just my personal opinion.

There's likewise, probably, you know, some regulatory approach that isn't no regulation. And there is regulation today. I mean, we're doing KYC AML. If you're, you know, if I want USDC, I go through that process. But just, you know, saying that we're going to regulate stablecoin issuers, for example, as banks, that's, you know, it's ludicrous. and frankly yeah yeah so that's bad regulation and you saw it again with uh i think it was finra or or you know one of these other institutions that was just hacked and they retained the information for it wasn't finra but it was another one that but they finson and they hold you know this data in perpetuity It's a honeypot. There's some really scary crap going on. CoinDesk wrote a great article about it.

And so, you know, regulation, I think, brings on risks that can, in many cases, be worse than the problem they're trying to solve. You touched on it, but that, I guess, Tlaib led, is that her name,ential legislation on stable coins, which I don't believe will ever see the light of day, but my god. So for anyone who's listening and doesn't understand, didn't hear about it, she basically was saying that she wanted stable coins to be regulated like

banks, correct? So if you're going to issue a stable coin, you had to have the same licensing, the same structures in place as a bank. But the argument was that stable coins are racist and predatory and that they don't want people creating stable coins and taking care and taking advantage of poor people. So the answer to that is to make them turn into banks who are actually, you know, predatory and taking advantage of poor people. The jump in logic to me, it bothered me for like three days. Anyone who had listened, I just bitched about this potential regulation.

But yeah, and then even worse than the regulation was, you know, Rohan Gray, who was one of the thinkers behind it, and who's clearly an exceptionally intelligent person and understands bank regulation and financial and systemic risks very deeply. But I think it's trying to apply them again, in ways that are totally tone deaf and antithetical to the actual technology has said thing almost gleefully, if you if you look at the tone about, you know, if it looks like I think it looks like a duck and quacks like a duck, it's a duck like, or something of that nature. But you know if it looks like i think it looks like a duck and quacks like a duck it's a duck like or something of that nature but you know he's said things like and it gets back to the platform um you know sort of section 230 in node operators could potentially you know be liable criminally the implication he made was but you know we wouldn't we wouldn't actually aggressively go

after them but you know that they could be, we wouldn't actually aggressively go after them, but you know, that they could be liable for, for example, illegal transactions that they validate. I mean, it's just, you know, come on. Leave it to the U S government to make crypto somehow painted as racist. Oh yeah. And then, yeah, the racism thing, I mean, it's just so comical. It's like banks are banks have systemically you know, blacklisted and not loaned or given equal opportunity.

Redlining. So, yeah, let's regulate everybody who's not doing that or may not, like banks. I mean, come on, guys. Don't kill innovation while it's sprouting. And beyond even killing innovation, I mean, it takes about five minutes of reading to understand that crypto was literally created or it's used for the opposite purpose, right? To empower poor people. All you have to do is look at any place where they actually have hyperinflation or people don't have access to their money to see how it helps the poor. Venezuela, Iran, Lebanon, Argentina, you choose your country.

And you could cherry pick data points that say, Hey, the wealth today is concentrated in a handful of, you know, Bitcoin whales or Ethereum whales or this and the other thing, but you're never going to get to the point where that starts to change. It has been changing, right? As new entrants come, as technology is built that reaches these folks, um, it's unquestionably happening. And, you know, we can point to all the examples you just highlighted. And so, again, to nip that in the bud while, you know, we're kind of improving while quote unquote decentralization is starting to propagate out, it's just insane. So we've talked about regulation and we've touched on central bank digital currencies before, but, you know, where do central bank digital currencies,

what is their role in all of this? I mean, China, we're obviously already seeing it, but what's our maybe time horizon for seeing it with the euro or the dollar? And how does it affect Bitcoin and crypto? Yeah. So I read Ryan Selkis's, I love his 20, 20. 130 page. I think I'm on like page 100 hundred and look, I really enjoy it. He's brave and he takes a viewpoint. It's,

it's opinion mixed with analysis, but he has a sound understanding of the research as well. Even if, you know, what he's presenting isn't research, it's really well thought out. And so he kind of took a very long, he said, look, I don't really care. I mean, I don't want to put that word in his mouth, but look, that's, that's, that's 10 years off. I don't think that's the case. Right. Like China has more than a billion people and DCEP, you know, their central bank digital currency is currently in pilots and is launching. And it is clearly a surveillance currency in a society that, you society that already has cameras on every street,

that you have your national ID. This is surveillance currency. If anything, to me, it's a factor we didn't talk about earlier that strengthens the bulkheads and the necessity of Bitcoin and other censorship-resisting currencies. They won't unilaterally or universally, I don't believe, replace central bank currencies, digital or not, but we need the alternatives. There are transactions that have to be private, that have to be unstoppable.

We can't put in the hands of our government every element of money from the moment of issuance, the moment of spend, to how it's recycled, and then reused, and where it's stored. And we've just seen through history, you have to have a way to store your own value and to move that value outside of government purview, you know, and the effect that for any case, for example, that a country blows up like Zimbabwe, you know, or Venezuela, you know, I'm reading a book, Lords of Finance, about the Great Depression now.

And so, you know, it's really important that we have the ability to have some level of financial sovereignty. Central bank digital currencies will absolutely reduce that by default. And it's critical. So anyway, it's not possible to regulate Bitcoin anymore. It's, you know, or Ethereum, I don't believe, you know, there's going to be a pocket that pops up somewhere else, you know, today to mine those currencies, you know, later to stake those currencies with Ethereum, but with Ethereum, but you, you know, they're, they're global at this point and distributed. So, you know, it's just a matter, it may have impacts on price, but you're not going,

these networks are not going away. These money networks. Yeah. They can't regulate Bitcoin anymore where they can certainly make it really difficult for you to get money in and out. Yes. Unquestionably. Yeah. And I think that that's sort of the scarier part. But money is a global competitive market as well. So if the US does that or China does that, somebody else might pop up. Exactly. So I guess maybe that's, yeah. So with Bitcoin, I think that's the strongest point is it's just whack-a-mole at this point.

Yeah. And you said, obviously that, I mean, we can all agree that there's things that cash are great for, right? So if everything becomes a CBDC and is all digital, there'll be no more private transacting with cash, which increases the bull case for Bitcoin. Also, I mean, I think just getting more people comfortable with the idea of a wallet and transacting digitally inevitably will draw them towards the original, right? Oh yeah, absolutely. You're going to be holding like with your Novi wallet or your PayPal wallet. I mean, you're going to be, you're going to be

holding, you know, or you're in China, you're going to be holding in your WeChat wallet, DSEP and, and you know, whatever other digital currencies, um, you know, whatever other digital currencies, you know, they allow. And the same in the U.S. once this happens. But it's fun to talk about, obviously, the, well, not fun at all, but it's common to talk about in the Bitcoin community, the hyperinflation of the dollar and that that's coming and that Bitcoin will become the reserve currency of the world. But, I mean, you've recently even tweeted, I think, that the dollar is still the reserve currency of crypto, right?

Yeah, and increasingly so. I mean, stablecoins are critical to the functioning of crypto markets. It's, you know, particularly because we're still in a time of, you know, sort of heavy trading speculation, trading and speculation. I mean, that's just a big part of the market. And so the velocity of money that's moving through these markets, uh, not sort of parked in long-term store value is a dollar denominated because people don't want that volatility while they're trading. Um, or, you know, that's not the purpose of, of, of their strategies. So yeah, I mean, and the markets are functioning and so, yeah.

And the proliferation of stable coins i mean they are just dollars right i mean people we people want to pretend that they're cryptocurrency but but at the end of the day the dollar hyperinflates so do your stable coins correct correct yeah which is so i mean people are trying to get exposure to the cryptocurrencies to your point uh you know they're not trying to get exposure the dollar they're just using it you know as a means for their strategies yeah i agree so i know we're kind of up against it with time so with the block specifically i guess and g g g2m that's what's g2m yeah um what do you see ventures it's a it's oh sorry yeah no go ahead please yeah but i'd love to actually answer the question you were going to ask.

I was just going to say, so what do you see as like the core sort of competencies of your business evolving over the next year? Because obviously it seems to change so fast, right? Yeah. So I called the consulting business, go-to-market ventures, GTM ventures, because I basically looked at the, you know, crypto landscape and said, Hey, the thing that I think most of these, uh, entities have difficulty with is not creating, you know, really cool technology. Um, but actually taking it to market, explaining it to people, uh, selling it, marketing it. And I really have done

that before for very popular products. And from Venmo to before that, what now is Google Pay and populating that. And when I say go to market, it's not only to the end user, the end retail user, but also again, the institutions who will use these products. So, you know, with immune, it could be the exchanges that might want to list these tokens. I work with another company called Nash, which is an exchange based in Europe. Yeah. So non-custodial exchange. And so I love the ethos of Nash and, you know, working with them you know, it's, it's a fantastic group of folks where the founders are five

developers. They have skillsets beyond that, but I can work with them to bring sort of a go-to-market prioritization strategy and work with their business team. Not only to like make introductions and, but, but really strategically to say, Hey, this is, here's some best practices to go from X to X. So it's, it's really top to bottom services, obviously. And it's so important because in any nation industry like this, you have these, like this core of tech people who are so hardcore and brilliant, but literally don't know anything

about anything else when it comes to, yeah, I've lucked out. I think, you know, I try to avoid companies that don't know anything about it, like ones who realize the value of a sound go-to-market strategy will listen to folks who have done it before and then will invest behind it, right? Because I can only work with a limited set of companies. And then as I look long-term,

I said it earlier, but I'm really excited about, you know, the application of stable coins and new, call it payments or money movement rails, not like ones that depend on volatile cryptocurrencies like XRP, but, you know, low-cost global rails that move money. It's the area that I participated in. So, so, you know, at the previous companies that I've worked at in long run, you know, I'll probably build a business in that, in that area. It's, it's going to be a year, two years, that kind of thing. I love it. That's the long run. That's the long run. Like if you had a 10 year in 2010,

if someone said to you, yeah, what are you going to do in long run? Well, you know, 10 years down the road, I might. And now it's like, I've lived multiple lifetimes. Yeah. And with the block, look, I thought, uh, just crypto moves at light speed. And so our current CEO of the block, like I'm chairman now is he's a, he's a came through wall street, incredible understanding of, you know, financial markets, great leaders. His name is Mike McCaffrey. We're all Mike's at the block. Seriously. I just said, look, he's a better

leader. I'm a, I'm an intense, volatile, outward personality. Like just, we need a leader where the focus is on the work that these folks are doing, the incredible work and that brand. It's an institutional brand. So anyway, he's been doing a great job. But yeah, things just change so darn fast. I love it. When I retire in 18 months, I'll be able to focus on my hobbies. So where can everybody keep up with you, follow you after this? Yeah. So if you want to see my tweets for 48 hours at a time before I delete them,

at mdudas, at M- Dudas at M D U D A S. But yeah, look, I have my DMS open there and I respond to pretty much everybody who reaches out and I really enjoy the conversation these days. And frankly, I've really been heartened by the conversation and how positive it's become. We have a lot of folks who have moved from maxis into a lot of the most thoughtful people are now interested in multiple cryptocurrencies. So for the last six to nine months, I've just been really having a blast as much publicly as I have sort of

privately in DMS. And I'm also at MDU DAS and telegram. Awesome. Well, I really appreciate you taking the time, Rob, really interesting insight here because so many people don't understand what it takes to actually understand this market, put all that research together when it's so incredibly scattered and brand new. And then to obviously then be able to use that to project what's coming. It's just a rare person. So I appreciate you giving us that insight.

I think people are going to absolutely love the conversation. Really appreciate it. Thanks so much.