The Wolf Of All Streets - Reddit HOLDS Bitcoin, ETF Outflow, Trump’s Regulation | Crypto Town Hall

Episode Date: February 23, 2024

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Hey, Carlo, our boy John Deaton is making some waves, huh? Yes, he is. And I'm thrilled to see him jump into this race. She's got her hands full because I think he he's not only got the credentials for the job as far as his prior government service, military service, and the fact that the battleground here is crypto makes it for an interesting race. So I think she's definitely got something to worry about. She seems scared, honestly. Like that one take maybe is that she's using it as a quick opportunity to raise money. But the velocity at which she responded and with such incredible panic in the language that she used in her fundraising, I found really surprising. It seems that in my opinion, that she made him a viable opponent

just by her response, which she could have just said nothing. Yes, because the interesting thing about that is he's not even really officially in the race against her because he's still got to clear the Republican primary. So yes, he's given, he's now got a lane for fundraising and for media attention that he probably would not have had otherwise. So she probably made a tactical mistake there by making this a big deal. Yeah, I agree. She gave him instant credibility, instant access to endless media, and just really made him viable. Like you said, I mean, he's not even her opponent yet. And the way that she characterized him is just hilarious.

A MAGA Republican backed by the RNC machine when he's quite literally the exact opposite. Just a guy trying to do the right thing who's running has no effectively minimal backing starting and probably couldn't be characterized as MAGA at all. And by the way, guys, I don't do politics at all. We're speaking of this objectively. But I think regardless of your party, you have to accept from her own rhetoric that Elizabeth Warren is effectively public enemy number one for this industry. And so, you know, she has to lose. And we happen to love John. He's a friend of the show.

He's a friend in general. And just like the stars aligning so perfectly here for this, in my opinion. And the thing that's interesting about him as an opponent is he's not a person that I think is going to be vetting stuff and looking at how things will pull. He's going to be blunt and he's a

brilliant lawyer it's that far she's she's really gonna have her hands her hands cold i'm not sure if it's my internet or yours it's glitching i've been having problems all morning but you were a bit glitchy there can you guys guys hear me okay? And could you guys hear Carlo? Okay. Okay, cool. Dave, I know that you're excited about this fight. This wasn't meant to be the initial topic here, guys. But I think that this to me is the biggest thing that's happening this week. But Dave, you gotta love it. I mean, obviously, I do. And I talked to John, as you did. Sorry, I'm driving. I talked to John, as you did before he did this. And there are a bunch of things that matter. But one thing I would say, and a lot of politicians have understood this for years, it's kind of an old maxim. One does not gain popularity of being against something very often. And if you do, it has to be something that's universally despised. So the notion of an anti-crypto army was always going to be problematic for her. And effectively trying to blame a special interest on an industry that by every metric is more inclusive, higher minority participation, higher poor people participation than the equity markets, et cetera, is not going to be a winning strategy. In fact, it only is a winning strategy if it can

be hidden. But this is going to bring it out into the open. And that is incredibly important, even if he can't win. And I've made the joke a few times that it will also bring the eye of Soran back to Massachusetts. Now, why does that matter? Well, I've heard from multiple people in D.C. that Senator Warren is very important in terms of dispersing DNC funds. And so if she is threatened, that means that all the other vulnerable candidates who are also part of our anti-crypto coalition may have problems. And so in general, it's just it's very good news for the industry. Yeah, she's the tip of the spear.

So to attack her, obviously, anyone who doesn't understand how important she is, she's the most powerful senator in finance in the United States because she heads the committee. She's effectively the reason that we have Gary Gensler at the SEC and she's the reason that we have a anti. Let me just make one more point. That is really important because there are many people in traditional finance who want her gone too. What is hard to understand inside our crypto bubble, but look, I'm on Security Traders Association. I'm on the board of the New York chapter. And I talk to my old friends in TradFi all the time. There has never been an SEC or a financial regulatory regime that has had more industry unanimity about how bad they are. And this is an opportunity. They all see this opportunity, too. So don't be surprised if his appeal broadens beyond crypto. Yeah, I mean, again, right. Like I said,

she's the reason Gary Gensler is at the SEC. And as much as we, to your point, think he's so unpopular in crypto, he's unpopular everywhere. Private equity hates him. Hedge funds hate him. Right. The transparency around short selling. There's a lot of things that people are very unhappy with him about on Wall Street. And so, you know, she effectively, her losing is the way to end all of this, all of this nonsense. So just, I think, a really interesting sort of way to start the conversation. Carlo, there's actually a lot of, since we have you, there's a lot of sort of legal things happening this week.

We have Kraken and SEC both, and excuse me, Coinbase both pushing back against the SEC, trying to get cases dropped. We have a company in Texas that's, I believe, suing the SEC, basically to get clarity once again on... Are we having connection issues today? I don't know. I think it's you. I'm not quite sure because... Can you guys hear me? I don't know. Yeah, we can hear you. I think everyone can hear me, Carlo, and you were breaking up a bit earlier. So maybe if you sign off and sign back on, Carlo. I don't think you can hear me. Well, we'll figure that out. But yeah, quite a lot of pushback, not just in obviously having Senator Warren have an opponent here, but from people who no longer fear the SEC at all, which I think is interesting.

And people are saying I'm echoing now. So, well, we can dive into the other topics here then and get straight into it. I'm not sure if people saw, I guess, while we're doing politics, but it is in the topic here that Donald Trump had a comment on Bitcoin. I can tell you guys exactly what he said. He said that Bitcoin has taken on a life of its own. Originally, obviously, he had said that it was not a fan. He said that I can live with it. You probably have to do some regulation, but many people are embracing it. More and more, I'm seeing people wanting to pay Bitcoin.

I can live with it one way or the other. Not exactly a rousing endorsement, but certainly effectively saying I will not be a part of the anti-crypto army. What do you guys make of this commentary? Do you think that this was an off-the-cuff statement? This was with Fox News during a town hall event with Ingram, I think. Ingram. And do we think that this is a true position? A lot of people saying that this is the influence of Vivek Ramaswamy. A lot of people saying that he could just effectively say nothing,

say he's not against it, and that's a winning tactic. What do you guys think of Donald Trump's effectively at least softening his position? Matthew, I saw you giving sort of a thumbs up there. Go ahead. Yeah, in this world where we're seeing a lot of single issue voters, and especially in our, not so much an echo chamber, but our ecosystem, our lovely Web3 ecosystem. So, you know, in this world of single party candidates or single voter issues, I think being a candidate that just takes a softer stance on this and says, no, we're not totally against it, doesn't necessarily be a ringing endorsement. But for people who are super focused on the crypto and Web3 space, I think that's enough

for them to go, well, at least this is a drastically different mindset and paradigm shift from what we're currently seeing. So I don't think he has to fully endorse it for people to get on board. And I think the Vivek influence is certainly there. So it's just easy enough for him to take a softer stance. And I think that that's a W in his column. Yeah. And it's not harder to take a softer stance than what we're seeing from the current White House administration. Tomer, I saw you giving the thumbs up there. I think you probably agree. Yeah. Thanks for inviting me. Thanks for having me. I think this is all we really want. At the end of the day, we don't want Bitcoin to get all

tangled up with government in the first place. We don't want it to be the official currency of the world figure out what to do with it rather than have legislators tell us what we're going to do with it. So that's just my added two cents there. Yeah, we've seen that Vivek is obviously one of his potential VP candidates. So I can't imagine that they haven't at least had a sort of superficial conversation about this. And also, we do know that Trump is pretty deep in NFTs. So regardless of what he said about it in the past, and honestly, a lot of people pointed to the fact that when he was dismissive of it in the past, they thought that those were sort of canned tweets or narratives coming from Mnuchin, who was, you know, in the cabinet at the time. So maybe, like you said, the softening stance or effectively just saying we will do nothing is the best case scenario. I actually am wondering, do you guys think that Bitcoin will be a major issue in this election if the two candidates are Trump and Biden? Or do you

think that it'll be sort of dismissed and thrown by the wayside? In the primaries, obviously, everybody had an opinion, right? All the younger candidates came out. But now that we're likely down to these two, do we think that Bitcoin takes the main stage in the coming election? Or do we think that it just becomes sort of fallen by the wayside? Jordan, what do you think? Hi there. Yeah, well, you can tell by my accent, I'm not from the US and from Scotland, but obviously the whole world is looking at the US. So I think it won't be a big talking point through this. I think a lot of people are just staying neutral on it. Like, I wouldn't say that Trump was endorsing it last night when he was speaking.

It's more just staying neutral. And if you look at the Bitcoin and crypto space, they've sucked that up. And I kind of see that as the plan is to get these voters on site. And that's kind of the way that I'm seeing it from over the pond anyway. I think that's rational take. Anybody else have any thoughts on this, Paul? Yeah, so my take is based on the way Trump has acted with respect to Bitcoin and crypto is that in his heart, he doesn't seem like he's in it. It feels almost like he's got some young kid in his staff and saying, hey, this is the cool thing. Let's go launch some NFTs. Let's say something about Bitcoin, because it is a talking point. I do finally think it will be a talking point within this election, especially because we have a third party candidate with RFK making very, very, very strong support, creating for strong support of Bitcoin. And barring insanely even more massive censorship from media, he's

got a pretty good chance of getting into the debates. And with the debates, someone's going to bring it up, whether he does, or I feel like one of the other candidates who might be anti-crypto will bring it up. Because I hate to say it, as much as we love crypto, it's so easy to bring up kind of negative sentiment around it. It's easy to create a negative narrative

around crypto. So finally, I think it is going to be a piece of the campaigns, already has been. And we have a candidate that I think is the true pro-Bitcoin. There was a tweet, I think, that Wendy O put out saying, hey, you know, Trump is pro-Bitcoin, I'm pro-Bitcoin, you know, I'm a single-issue voter. I don't think he's the pro-Bitcoin candidate,

if that's, you know, what we're really looking for. RFK is the pro-Bitcoin candidate, is what you're saying, which is very clear. It is clear. Saying I'm not going to kill you does not make you pro-Bitcoin. That's effectively what Trump is saying here. He's saying, dude, I believe he used the term It is clear. It is clear. Saying I'm not going to kill you does not make you pro-Bitcoin. It doesn't. That's effectively what Trump is saying here. Right.

He's saying, I believe he used the term that we've seen before, which is hilarious. I think it was Jamie Dimon that also said people should have the freedom to do Bitcoin or lots of people are doing Bitcoin, which shows that you clearly have no idea what's going on anyways. And also Trump in his statement, I don't have the exact quote in front of me, but he says he's seeing a lot of people doing payments or interested in paying with Bitcoin. And clearly, that's not what he's seeing. We know that that's not happening. Clearly, he doesn't have experience with it.

It's something within his staff that's saying, somebody within his staff that's saying, hey, this is a talking point. We need to say something about it. But he can't get it out of his soul that he's not truly a fan of this technology. That's my take. Even in the statement, he says, I'm only a fan of one currency, and that's the dollar, right? I mean, he says that every single time. So that's pretty clear. Tomer, go ahead. Yeah, I think maybe one of the most interesting things that could happen this year that might make an issue is if if one of the anti-bitcoin anti-crypto candidates makes a big issue out of it because the the army the real army is not the

anti-crypto army it's the it's the pro-bitcoin pro-crypto army of people who are ready to community note and correct and rectify any miscommunications about this space very rapidly like we saw the ecB put something out yesterday and within, within hours there were tons of corrective statements, tons of tons of lampooning and so on. And so I think as this and we've got the having coming up, there's a lot happening this year aside from the presidential election that puts Bitcoin and crypto in the spotlight.

And so I do think if we get someone who's trying to make it an issue, trying to make banning it an issue, that it swings the pendulum over. There's no press that's bad press for Bitcoin. Everything's good for Bitcoin. All of these sayings actually hold true because they make more and more people aware. And then some people are scared off the first, second or third time they hear about it. But by the fourth or fifth time they hear about it, they're like, wait, this thing isn't going away. And there's different people saying different things. And it seems to be much bigger than it was last time. So this could

be a really big year. I'm not saying it's necessarily going to be a presidential issue, but the candidates are always looking for something to divide the electorate with and take aside. And I think it would be a big miscalculation in hindsight, but a seemingly tempting calculation ahead of things to differentiate oneself and say, I'm against Bitcoin because it's used by criminals and money laundering and all this kind of stuff that keeps getting said, but has less and less teeth with each passing month. As I think about it more, we obviously started talking about John Deaton versus Elizabeth Warren. I think that assuming that that race is on the national stage and John continues to make noise and make waves and attack

her as the anti-crypto army, I do think it will become a much bigger issue in this election because she'll be fighting for her life defending her anti-crypto position and will probably ask for a lot of help from the White House and otherwise. But as Dave said, I mean, Dave, you made the best point. Being anti-something is so wildly unpopular. I understand it from a financing her campaign from the bank's perspective. But even in the United States, for people who don't like crypto or don't own it, they're not against it. There's no, I don't think, community-like constituent sentiment to kill crypto. I think that either you have accepted Bitcoin or you've dabbled in crypto or you just don't care.

But I still don't understand who it appeals to be aggressively anti-crypto. I mean, Dave, why do you think she still continues to take that stance, continues to push the narratives of terrorist financing and like no matter how many times you get dunked on community notes noted corrected wall street journal uh apologizing still goes still pushing davey there i love your take the struggles the struggles are real today disappears as i'm asking anybody else have a thought on that? I could chime on that. Really, it's look at our history. The history of crypto is riddled with really bad news. It's, it's kind of an easy thing to rally around. And I'm not just in the crypto bubble, even though I take part in a lot of the conferences and meetups,

you know, just being in the tech space, I've participated a lot of just tech community events. And when I interface with people are definitely not necessarily crypto people, you will hear a lot of the negative sentiments like, oh, okay, well, who lost money today? And oh, I heard about that $100 million hack or that billion dollar hack. And so I think she's rallying around a lot of the negative sentiment, especially of the negative sentiment that we had back in 2022, early 2023. That's the piece that she's trying to rally around. Fortunately, now that we're in this cycle of the election year, we haven't had nearly as much of that. And it's basically going and backfiring against her in the sense that now it's actually a positive sentiment that's rallied around with the ETF having launched

a potential Ethereum ETF launching. So it's really a timing thing. And she'd rallied around it at the right time back then, but kind of veering onto wrong timing at this point. It actually seems to be almost a bad move for her because there is so much institutional adoption coming now of crypto that the timing of her anti-crypto movement is sort of, I think, emphatical to the very bankers and financiers who are her lifeline for funding and support. So I think she's essentially shooting herself in the foot right now by continuing to push this narrative in the face of the mass adoption that we're seeing. Yeah, listen, it's not, maybe it is a coincidence, but I refuse to believe that right after the SEC in a 48-hour period filed massive suits against Coinbase and Binance.

Coincidentally, BlackRock comes out and files for a Bitcoin spot ETF. And Larry Fink goes on a worldwide roadshow talking about crypto being a flight to quality and the importance of its asset class and tokenizing everything. So to your point, I don't know who she's pissed off, but some of the biggest names are vehemently opposed to her positions on crypto and are supporting and pushing this industry forward. Maybe she didn't see that coming, Carlo. I mean, what do you think? Larry Fink's more powerful than Elizabeth Warren. hates crypto as much as she's genuinely looking for talking points because she's always run on this uh on this platform that she's you know there for the little guy quote unquote and always willing to take on the institutions I think that in this instance she looked at this as being a a danger to

consumers that she was going to champion this cause to protect consumers. But when you look at the number of institutions that want to put securities and want to put trading on blockchains, she's kind of working now counterintuitive to where the trend is going. And I think ultimately, this is going to backfire for her. And if Biden continues to align himself with her as far as taking direction from her on this, I think it's going to hurt his reelection chances, candidly. Ed, I'm so glad you're here. What do you think? No, yeah, I think what Carlos said is right on. I think she champions herself as somebody who looks out for the little guy. She's more on the left side of the left wing. And really, she's not really too much of a pro-capitalist.

Whereas, I mean, I think most Democrats are capitalists, but the left wing of the left side, the left side of the left wing, they kind of stray away from that. And I think it's bad for the Democratic Party. I think it's, you know, I think, I don't know who it was earlier said it never really benefits somebody to go against something unless it's something extremely evil. Right. And that's something that everybody agrees is bad. But like Bitcoin and even crypto in general, nobody's like I mean, I guess you could say like altcoins and stuff. There's people who are highly against altcoins, but Bitcoin in general, there's not really clans of people who are anti-Bitcoin. So I don't see the benefit in it, other than I think she thinks she's actually doing good by going against Bitcoin. Maybe she thinks that people who don't know a lot about it are going to put money into it, and then we'll

have another bear market, and then they'll lose a significant sum. I don't know. I don't know what her thinking is, but I definitely don't agree with it. Dave, go ahead. Yeah, I think there's two points here that are kind of important. The first one is, being anti-crypto is one thing, but we all know that her stance has been unbelievably counterproductive, and we may know that. But the average human being, the average voter does not. John will absolutely make that point. We know that she was cozy with the elder Bankman Freeds.

We know that she was part of the agenda to have meetings with FTX and never meet with Coinbase and Kraken and other people who are in the industry. We know that most of the frauds that happened were because there was no regulatory regime. And she has been the champion of this stonewalling of saying, yeah, we don't want to legitimize the industry by regulating it. And those issues come home to roost if they get elevated. And of course, in this campaign, they're going to get elevated because they're so obvious and they're easy to understand issues. So they're really hard to obfuscate. So that's thing number one. Thing number two, there was an article today in the journal by Alex Osipovich, which is also going to end up getting highlighted, which is, you know, the article is titled is trading frenzies grip penny stocks criticism of NASDAQ grows. But it's going to shine a light on the fact that there's just as much nonsense, such as many degens in the stock market as there is in crypto. Only the difference is, at least in crypto, a lot of the opacity is gone. Now, there are plenty of founders who do all sorts of things with tokenomics and crypto that isn't good. But the fact is, is in the equity market where there is

no public ledger, it allows that to get highlighted. So the fact that there are narratives that are easy to understand if they get the light of day, that's something that people need to understand because it matters. These narratives, these stories matter. And the public, while they're not incredibly sensitive, they're not going to understand the difference between DeFi and CeFi. They're going to understand, oh, wait a minute. There's a public ledger that anybody can see, whereas in equities there isn't. And this is the thing you're saying you hate? Those sorts of stories are going to work.

Yeah, and John's going to expose her, as you said, which is the best part. Sasha, I saw you had your hand up before. Yeah, I mean, fully agree. Some of what I was going to say is very similar to what dave said um but i think there's also another step back we have to to make and get out of our crypto bubbles and i think those politicians obviously are focused on the majority of people and and i think right now of the back of what happened with ftx they're clearly careful about the narratives about being too positive about crypto because it's a very slippery slope. And I think they're trying to figure out

what the majority of people think about. And if you take your parents, your grandparents, this is something that might be scary to them because they don't understand it. They don't know how it works. And the media has been trying to associate the entire crypto space with scams, with fraud, with manipulation. And obviously we know, and back to Dave's point about building the right narratives around it, I think it's very important. But I think they're still afraid about that slippery slope of getting in the wrong direction and not addressing the majority of their voters. Yeah, I agree.

Again, I think there's plenty of people who are single-issue voters on behalf of Bitcoin and crypto who literally will vote for any candidate that they think supports the narrative. I can't imagine there's a single-issue voter out there in the world who's voting because of a candidate being anti-crypto or anti-Bitcoin. So it just makes no sense to me unless there are other incentives that we don't know about, but we can conjecture about that, I think, somewhat endlessly. I think we should talk about the fact that Reddit reported that they've been moving some of their treasury into Bitcoin and Ethereum. It was underreported. I don't think they were making a big deal out of it and it got caught up by the media. But it's been a long time since we've seen a notable company or platform take up the sailor narrative of putting Bitcoin on your balance sheet to hedge against inflation and

such. So what do you guys make of Reddit making this move at this time? Anybody have some thoughts on that? Feel free to jump in. I think that the specific company is less important than understanding the backdrop, which is effective January or effective this fiscal year, companies for the first time can own Bitcoin on their balance sheet and get positive and negative exposure. Previously, it was only negative. And so, yeah, you know, maybe, you know, Reddit is doing this as a stunt, but I wouldn't be ridiculously surprised if there are dozens

of companies that attended Michael Saylor's institute or whatever he called it, his conference, that have tabled the idea until this year. And now you're going to start hearing about them. I think it's just yet another asset pool that is opened up to it. And Reddit just happens to be one that, okay, they were one of the the more likely to do it and i don't think it's anything beyond that i think yeah i'm gonna chip in i think a lot of it will stem back to the co-founder alexis because if you look back to 2012 he seeded coinbase and he is also a large investor in the Bitcoin space. So it makes sense for these companies to, if they've got excess cash, to be moving some

of it into Bitcoin and taking the Michael Saylor playbook, because otherwise it is just a melting ice cube. So I think we're going to see this a lot more and it's going to become a lot more common in the future. And I like that it's Reddit because it is a well-known brand and people can relate to it. And that's what my company is all about, is simplifying Bitcoin and making it relatable. So it's nice to see one of the well-known brands adopting it.

Paul. So Reddit, perfect brand to start incorporating crypto. People might have forgotten, but back in 2011, 2012, Reddit actually hired Ryan X. Charles at the time, a very well-known Bitcoin developer, to incorporate crypto into their platform and potentially even launch a token specifically tied to Reddit. The technology was very early. We weren't really well baked out. It's a different time today. So I'm just going to have like this fun speculation that they might actually try to reincorporate some aspect of cryptocurrency onto the platform.

What that is, hard to say. It is a centralized platform and doing it in a self-custody way is a challenge. But for a very long time, they were one of the first well-known brands to have a core interest in not just acquiring crypto, but actually putting it into the platform so that people can use. So I think it's a long shot, but it is a speculation that I think could be a fun one and obviously would bring Reddit some very interesting rewards if they're able to pump the price from an actual piece of adoption of crypto baked right into the platform with millions of users. What do we make of the fact that they also added Ethereum? Because that's not something we've seen. Sasha? Yeah, I think there's also Reddit has been struggling with the monetization of their platform as well. There was a big backlash when they started

charging all the builders for API access. But to me, a lot of this is a great marketing stunt for their IPO. I don't think I saw any actual numbers of how much they invested.

It was more of a line in their disclosure somewhere that they held these assets. And so it's really a brilliant tactic to say we hold both. As to why Ethereum? Well, I think Ethereum is really according to the narrative of financial infrastructure more than store of value. And I think that's what they're also looking after, right? It's building platforms,

building infrastructure. And it's also a way to have the two communities, which are sometimes pretty at odds, rally in the name of Reddit. Yeah, I think we all agree that anyone putting these assets on the balance sheet is a friend of us and it's good news. Dave, I love your point about the Sailor CFO conference. I talk about it all the time. We've probably talked about it before. I think that was like February 2021

now, right? So three years ago, he sat down with 2000 CFOs famously after he had added Bitcoin to the balance sheet. And we were all surprised to see nobody do it. But it was all those gap accounting laws that you're talking about. Yeah, I mean, it's important for people to understand if you're a CFO and you want to go to your board and you have to explain, yeah, we're going to put something on the balance sheet because of these X, Y, Z reasons. But if it goes up, we will get no credit for it. And if it goes down, we're going to look like the village idiots. That's really hard. That was a non-starter. And so it basically only real

degents happen. So what happened in the last month that might have brought people back to that date? Well, don't be surprised because we saw, I mean, it hasn't happened yet, but there have been multiple articles about microstrategy being potentially included in the S&P as discretion. But the absolute truth is that that article made the rounds. And if you attended that conference and you read that and you saw what happened and you're like, well, wait a minute, I want to get me some of that. I mean, there's an old joke about football that it's a copycat league. There's an old joke about finance that everyone wants to copy the most recent, most successful. Everyone's chasing what worked over the past year. It's not crazy to think that a lot of the people who attended that conference and talked about it, seeing that news, would say, maybe we should reevaluate it as well. It doesn't hurt with Larry Fink proselytizing and Fidelity doing the same. It's just part of the same thing. You know, my friend Ben Hunt,

who does Epsilon Theory, he talks about narrative shifts. Those things take time, but this is all part of a narrative shift. I agree. Carlo, before when we were having some tech issues, I think you're working now. I just wanted to circle back to the SEC, what's happening with Kraken and Coinbase, and they're getting sued now by a company in Texas for more clarity on what is or is not a security. It seems like there's zero fear of the SEC. In my mind, 18 months ago, I would have been shocked to see anybody sue the SEC. They had this 99% famous win rate. They never lost. And they just literally never win against the crypto industry. I feel like nobody fears them anymore.

But what's happening with those cases? I, first off, love to see the pushback. Kraken, I don't know if anyone's seen it, but Kraken's official website posted an announcement on the motion to dismiss that they filed yesterday. And it kind of mirrors the arguments that have been raised in the recent hearing on the Coinbase matter as far as they're making up the definition of an investment contract and they're sort of trying to redefine this notion of a digital asset investment contract. They're trying to sort of carve out an exception because they're failing to make a successful argument that there

is a contractual relationship when it comes to token offerings and Kraken offering the tokens. And I think this is a problem for the SEC. And I love seeing Kraken push back in this way. And I have to agree with you, Scott. I think they're on the ropes right now. And this lawsuit in Texas, albeit it's kind of a vague assault on the SEC and digital assets because it's more tied to requirements for listing securities, which I think they're arguing is a hindrance to business. But I think it gets the job done because it's now putting it front and center in the Fifth Circuit Court of Appeals for some clarity on exactly what the limits are and what the SEC can do under their current mandate. I don't remember the name. It's like legit.finance or something. It's literally the most laughable exchange that they're trying to launch. I get the feeling that somebody created basically a shell company so that they could go after the SEC and get clarity because it's alongside a lobbying organization as well, the Texas case, right?

I mean, is that your take here? Because nobody's ever heard of these people before, and that's not an uncommon thing to do, right? If you want to force the hand of the regulator, you create an entity, you create a lawsuit, and it's kind of like the anti-Promethean here. Well, also remember, I think multiple states have jumped into this. I think there are multiple states that have signed off on this request for clarity that was filed the other day in Texas. Matt, go ahead. Yeah, just one thing on the Reddit and the crypto thing. I think the big thing that I think is going to attract a lot more folks is the uh changing the fasbi rules we saw this happen at the end of

december and does that not allow more um companies etc to add this as a treasury asset to the balance sheet the fasbi rule thank you yeah that was the point that dave was that that we were discussing i came in like so i'm sorry i missed that thank No, no, no problem. Yeah. I'm just reiterating. It's a, it's a good point because now it can be done and, and we're going to see it even if it just slowly, slowly trickles with Reddit starting. It can be done. Dan, I brought you up. I saw you in the audience. I'm glad you're here. Anytime I hear, you know, we talk politics or regulation, I scan for the audience and hope you'll show up. Oh yeah. No, thanks for having me. Yeah. Well, it's been a or regulation. I scan for the audience and hope you'll show up. Oh, yeah.

No, thanks for having me. Yeah, well, it's been a busy night. I mean, just the last 24 hours, obviously, we saw what leads in Texas filed that statement against the EIA regarding Bitcoin miners in Texas. And then, of course, the Kraken news. Ripley came up pretty strong last night, completely agreed with what he's doing, what he's doing standing up to the SEC. It almost assuredly was retaliatory. And then last night, too, with President Trump coming out fairly, I don't want to say like 100 percent favorable on Bitcoin. But boy, what a change of pace since Mnuchin was his treasury secretary.

Of course, it was him that basically wrote that tweet a few years ago against Bitcoin. So I think that's just a great sign. There's a lot going on. We've talked about it endlessly here, but I haven't gotten to ask you about Deaton running against Elizabeth Warren. So what are your thoughts there? I think it's great. I mean, listen, he's got an uphill battle. But I mean, listen, anybody who's any opponent to Warren, obviously, I think our industry needs to get behind.

And he's credible. I mean, he's got an incredible background. He's been very supportive of our industry, as we all know, over the last few years, longer than that even. And he's tough. And I think he's going to take it to task. Of course, he's blaming everybody in Make America Great Again crowd, you know, for recruiting him, which he disputes. I mean, it doesn't matter to me. I mean, I think that, you know, I think he's going to be a good candidate. We'll see if he ever debates him. I

doubt he will. But he'll get quite a bit of influx of campaign contributions from our industry. And, you know, I know the only other candidate that was polling well against her was Charlie Baker, the governor, former governor up there who took on the, was the NCAA presidency. So, that's a tough job to give up. So I don't blame him for not running. But somebody like him, if he can endorse Deaton, if we can get some support from the state of Massachusetts, some elected officials up there, it can only help. But he's going to need to spend a lot of time in Massachusetts now. So the only downside is I'm not sure if he'll be out on the conference circuit this year. He's probably going to be focused hard on Massachusetts.

We can sacrifice his presence in our conferences to get him out on the campaign trail, I think. You made a good point, though, Charlie Baker. People have this notion that Massachusetts is massively blue and only goes blue and would only vote blue. But they've had a number of Republican governors. And Charlie Baker is massively popular. Like you say, he's not giving up that amazing job at the NCAA. But I mean, he was extremely popular and has pulled exceptionally favorably if he had run against her. So people were trying to get him to run for her Senate seat, correct? We were, yeah. I mean, a lot of the folks in the industry were strongly trying to recruit him and

a lot of these independent super PACs. But you know, again, he's got a great job. I mean, a lot of folks in the industry were strongly trying to recruit him and a lot of these independent super PACs. But, you know, again, he's got a great job. I don't blame him. Politics is a dirty business. But, yeah, Massachusetts isn't necessarily hard blue. I mean, over the last 20 years, we've seen, you know, Bill Weld, even Mitt Romney was governor about 20 plus years ago. A Massachusetts Republican is obviously a lot different than other parts of the country. But I think Deaton has got as good a shot as any other Republican that would run. Love it. But before we wrap up, we should definitely talk markets. I've got Mike up here. Mike, we kind of talked at length yesterday about the massive earnings of NVIDIA. We haven't talked about it on this show, but seems there's a little pause now but what do you make of the

market reaction to that and what that can mean for crypto well first of piggyback on on the previous discussion it just brought me up with of two quotes that i've been pointing out for at least five years in this space that's happening fast first of all what doesn't kill you makes you stronger by nichi and thank you elizabeth war for that. We have to thank her because she made us stronger and better. And I also have to thank Churchill for what he said. Americans can always be trusted to do the right thing once all their possibilities have been exhausted. This is happening so prevalent in this space. And I like to chip over to what Trump is doing.

All you have to do is click on CoinMarketCap and click on volume on volume and see oh he used to say bitcoin is bad for the dollar mike well okay the the volume of tether and the 24 basis is double that of bitcoin i think people are figuring it out and the naysayers are getting it but the key thing from what you skipped hipped in is there's one stock on a global basis that matters amongst above everything and obviously that's n. And the problem I see is, as you look at now, this rally in the stock market is basically going to be potentially its own worst enemy. This is what I started saying about commodities about two years ago, when they were going up too much. They're their own worst enemy. That's happened clearly in almost all commodities except gold. And that's happening in the stock market now, if you look at the Fed.

At the beginning of the year, for this year, the market was priced at almost 170 basis points of rate cuts. Now we're down to, what is it, about 90 or less. And that's still very silly to have a speculative rally in risk assets, most notably the stock market. And with core inflation about double the target of Fed funds inflation, the concept of Fed easing is an oxymoron. It just does not happen unless they're silly, stupid, and we're a third world country. Just take that out of the picture. It's still priced in the picture because that's the problem I see is there's no chance of a Fed easing in this environment with speculative assets, most notably the stock market, and a care like this for the

Fed easing. Why would they take that risk? Because this is a world of intangible assets, really beating tangible assets. And that's clearly what's happening in cryptos. Look at Bitcoin. You can't hold gold anymore without some Bitcoin. I'm going to the metals and mining conference right after this call. And I'm going to state that on our panel. But, you know, people are getting it. It's just that's what's happening in this space. And I think the problem now is we're at this space. The point now is there's going to be no Feddies to help support markets until markets go down, which means the stock market, which has implications for highly speculative cryptos, mostly Bitcoin. But I'll end with this. This is the key thing I think Trump is finally figuring out.

When he pushed back on the dollar literally five years ago, and I wrote right away how strong this was for the dollar and how bullish this was to the dollar compared to any other currency. Now I think maybe he's figuring out from good advisors that, oh, yeah, this technology, it's embraced the dollar and Bitcoin is just kind of the gold of the space. Yeah, it's worth adding James Lavish isn't up here, but he would say this based on the some of the recent Treasury auctions, in particular, the 20 year, which was close to a failure. Having it doing something that would imperil Tether's massive Treasury holdings would be very problematic from a Treasury point of view. Exactly. Yeah. I mean, listen, if we're talking stable stable coins we may have touched on it yesterday but just do want to mention this that obviously usdc is pulling off of tron uh you guys may have seen this as the news a lot of speculation as to why that would be happening i think it's probably

clear that they you know are looking to go public eventually they're probably just looking to get clean uh with regulators a lot of people speculate, there could be problems coming for Tron or Justin Sun down the road. Not a huge story if you look at USDC because it was very small on Tron. But people still don't seem to realize that USDT, Tether, has a $101 billion market cap and $51 billion of that, over 50% is on Tron. So being that stablecoins are arguably the killer app for crypto, people are using them all over the world for quick and fast and cheap payments. And as much as obviously us Bitcoiners would love to say, hey, everybody's buying Bitcoin

to hedge against their hyperinflationary currency. No, they're not. They're buying stable coins and they're using stable coins because they want dollars. So I don't know what it would mean. I can't conjecture to say that Tether will make a similar move. But I think it's definitely worth watching. Anybody here have a strong opinion on USDC backing off of Tron and why that might be the case. I guess I'm the only one with a strong opinion on a USDC backing off of Tron and why that might be the case. So I think, I'll jump in. I'll agree with you. I think you nailed it on the head. That's exactly why they want to get clean. And yeah,

I think there's some trouble ahead there probably for Sun. So I think you nailed it. I just say, you know, cause Dave Dave, you made the point, obviously, that, you know, USTT effectively now, it's almost too big to fail for the United States government and the Treasury with the size and the amount of Treasuries that they own. But that could be a pretty big problem if for some reason they have to back off Tron, and that's where half their market their market cap is. So I think it's just something worth watching. Guys, I think we've pretty much

covered it all today. We'll be back obviously on Monday. Thank you to all our guests for joining you guys. By the way, you should be following all of our guests. If you're out there, follow our guests. And otherwise, I hope everybody has a great weekend. It will be interesting to see what the market does over the weekend once we're not aggressively tracking ETF inflows and outflows, as has become the case all week. So we should have a lot to talk about on Monday. Thanks, everybody. Have a great day.