The Wolf Of All Streets - Trump Pardons Ross Ulbricht | Crypto Town Hall

Episode Date: January 22, 2025

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Good morning, everybody. Welcome to Crypto Town Hall, a day today for most of the Bitcoin community to celebrate. As you can see here in the title and the big news of the day, Donald Trump has followed through with his promise and pardoned Ross Ulbricht, the founder of Silk Road, who I believe spent about a decade in prison on a two-lifetime plus 40 years sentence, I believe. This was something that Bitcoiners were very, very passionate about seeing done and is a promise delivered by Donald Trump in the first days of his presidency. That said, I think the community also awaiting executive orders on crypto, which has not happened, but reportedly will come in the first 200 executive orders. But in other news outside of Ross, which we'll dig a bit more into, we have the SEC forming a commission for crypto led by Hester Hurst. Really, really encouraging. Obviously, many refer to her as crypto mom. She hates the term, by the way.

I actually once called her crypto mom in an interview with her. She said, I'm not crypto mom. I just want people to have the freedom to innovate with proper disclosures. And she shut me down pretty fast. But very clear here that with the SEC now having Uyeda as the interim commissioner and Paul Atkins coming in and Hester Peirce leading the charge on regulation, specifically for crypto, that we are potentially entering a very, very optimistic time for the industry in the United States. I mean, Matt, maybe we should just talk about that first so we can get to Russell a bit later. We kind of have this situation we

haven't seen. So Trump launches a meme coin that we don't get the executive orders, but we do get Russell part in and then we get Hester Peirce and Uyeda. So kind of some mixed signals here, but I would say net massive positive here so far. Yeah, net massive positive. It's good to be on. Wonderful to celebrate Ross getting his freedom after after 10 years. Ridiculous sentence. But I take it all as a win. I mean, not all you know, we didn't mention part of it. Trump launched on Solana, which a week ago was facing SEC lawsuits as a potential illegal securities offering. So, you know, from my perspective, it's a 180.

It takes time to get all the executive orders through. You know, I do believe we'll see some version of a strategic Bitcoin reserve in the first hundred days. I think it's a complete game changer at the SEC and has really opened up a huge number of possibilities. And I still think the market hasn't processed the degree of the switch because it's just bigger than anything we've experienced in terms of how governments can shift overnight, at least in my lifetime. So I still think it's not priced in. And I'm very encouraged by the steps, particularly the rapid change that we're seeing at the SEC. I think that's a game changer.

And Peirce has long sort of hinted, I think, towards companies effectively should have a three-year period to prove that they're sufficiently decentralized or whatever criteria we come up with to not be a security, and then they can operate in the United States. Honestly, I think we've jumped way past that probably with Trump, but a very reasonable approach he's had for a very long time here. Yeah, I mean, let's talk a little bit. That's exactly right. The reason that's important is it allows the crypto industry to innovate. The regulatory knot that we were in was that the SEC declared effectively everything illegal that started with any degree of centralization. Only things that had a completely free and fair launch, like Bitcoin, could escape its grasp. And everything else was not just illegal to start,

but illegal forever. And in order for this industry to move forward, in order there to be game changing apps that are used by billions of people, you need to have the ability for entrepreneurs to have an idea, create something and then move to a system where it can be reasonably distributed and decentralized and tap into the power of blockchain. And that was just, you know, literally impossible. There was not a pathway there. That was what was wrong with the SEC is it was impossible for decentralized crypto apps to emerge and be embraced by millions and billions of people. And now that's possible. And, you know, again, to go back to what I said, I think people are underestimating, you know, what that means. We've sort of tied ourself in

all these absurd knots over the last four years, you know, with sort of wink and nod airdrops and tokens that don't have any meaningful rights and, you know, entrepreneurs restricted for the market. And all of that changes and not just like long-term, it changes day one. And you're already seeing, you know, UBS saying there's now something to crypto, Bank of America saying there's now something to crypto. And underneath the surface, I imagine, you know, a million smart people deciding to build on this technology. So I think it's a really big deal. Do you think it is a really big deal if we don't get executive orders? Yeah, yes, absolutely. You know, you can build your expectations up too much. So could there be a short term pullback if the executive order sort of spree

peters out and we don't have something like a strategic Bitcoin reserve? Absolutely. But if you're a true believer in the transformative potential of decentralized public blockchains, which, you know, if we take off our trader's hat and put on our long-term investor's hat, those are being unleashed. Executive orders are not. Those are being unleashed just by the changes we've seen at the SEC in the first few days. And if you take that long-term view, then any short-term pullback, if we're disappointed by the executive orders, would just be a buying opportunity. And I think ultimately, we are not going to be disappointed by the executive orders. Crypto is just taking its place in line. But if there is any short-term

pullback, again, I think it's a long-term opportunity because we've gone from these massive headwinds to these massive tailwinds. And I think that's going to play out not over weeks, but literally over years. So yeah, that's my thought. Perfect. I'm wondering what executive orders we could potentially get. I mean, I think everyone's waiting for the SBR, obviously. I think one was that we would potentially have crypto deemed a national priority, I believe is the terminology. SAB 121 overturn. Are those the big ones that are really possible? I think Polymarket actually had the SBR at over 60% now, which I was surprised.

Yeah, that's right. I think SBR is the big one. I think it's clear it's a national priority. We have a crypto czar in David Sachs, and we're already getting executive orders in and around the crypto space. So whether it's declared that or not, I think it's de facto that anyway. So SBR is the one that matters. SAB 121 is a dead man walking regardless of whether it's repealed by executive order or not. And I think all of Wall Street already knows that. So really, the only one that matters, quote unquote, in terms of, you know, printing a giant

green candle is the SBR and the degree to which it's robust. But yeah, you might see those other ones. But I think I think those are much less important. They're sort of already built into the market. Makes sense. Anybody else can feel free to jump in. Obviously, I know a bunch of you probably have thoughts on what's likely to come and how important it is. Alon, you haven't been here for a while, man. How are you? Doing great.

Early morning for me on the West Coast. I appreciate you guys. It's so great to hear your voices. And I see some friends on the speaker list too I appreciate you guys. It's so great to hear your voices and I see some friends on the speaker list too, aside from you. So, I'm stoked to be here. Thanks for having me. I'm, you know, just writing on what Matt just said, not exactly answering your question about the SBR because I wasn't sure if maybe it was going to end up being, you know, a Cynthia Loomis bill and try to get it through the Senate or what they're going to do. But as the dude up here, and I know Lou does this as well, who sees early stage startups every

single day, I am stoked for what's to come just based on, you know, the feelings people are having now. Every single American founder I would meet would be calling me, not every single one, but so many of the American founders I'd meet would be calling me from another country, right? They'd be calling me from Dubai or Thailand or Singapore or wherever they left because they felt like it was not okay to do what they wanted to do here in America. And think about the tens, hundreds of millions of dollars that went to lawyers just to try and do these like, you know, crypto jujitsu moves to try and make it somewhat feasible to launch their startup in America when literally, like, it's just nonsense, right? Like, people who are doing good things trying to create great economies are having to compete with the scammers. And this whole meme coin movement

kind of stemmed from the fact that we had no real rules, right? Like they went, hey, we can't do it that way. Let's YOLO it this way. And let's do all these kind of shady practices to try and get these tokens out, do these things. And obviously it's fueled by greed too. But I'm very, very happy that the SEC to try and get these tokens out, do these things. And obviously it's fueled by greed too, but it's,

it's, I'm, I'm very, very happy that, that the SEC kind of made it clear that they're not waiting for new commissioners to get shit done. They're going to just vote two out of three gets things done. And I don't think they could have picked a better person for the task force than Hester Peirce. And so I think we have what we've waited for for a long time. And so I'm just excited to see entrepreneurs get shit done and start pitching me in America and start investing in people that are close to home. Not sure if you saw it. It keeps getting, I think, removed online. It's a CNN panel with Van Jones. I had tweeted and it got removed this morning. Did you by any chance see that interview where he was talking

about meme coins and talking about why Americans buy crypto? It was really powerful. So I don't know if people caught it or if it got removed. Did you see it? I don't know if I saw that one. I think I was texting the Lunar Crush guys live right at the inauguration time and stuff. Every time I would see some stuff like this, but I remember one time it was really funny. It's a little bit of a Donald Trump troll from CNN, but it was hilarious. They said something like they mentioned his meme coin as he's walking in the room. He's like, this is the first time we're seeing Donald Trump on stage as a verifiable billionaire. It was just hilarious. Which means that CNN also doesn't understand low float, high FTV, by the way. They don't understand shit. None of them do. My favorite thing,

and my friends were giving me shit going, you're watching CNN. My favorite thing during all the political stuff is the bounce between uh CNN and Fox uh Fox News just to see the contrast in how stupid both of them are um and then of course you know uh hang in with our friends here on Twitter to to get the real deal but it's yeah it's so funny it wasn't a troll at all in this case okay jones yeah so he effectively said i wish i could find it first of all one of the quotes he had was a lot of people are buying crypto as a prayer for a better tomorrow as a hope that somehow something will go good for them which i thought was poignant you know and he was saying this obviously but what he he went on a rant he said listen i'm a california democrat and even i'm saying this he's's, you know, he's like, I believe in Silicon Valley and technology. This is the gist, obviously. Yeah. And he basically said, you know, Biden,

who I love, he said this, and Elizabeth Warren, who I love, he said this, he like absolutely crushed innovation in the United States. It was just very strange. And then and he went on to say that the crypto industry had a lot of like incredible builders and technologists and entrepreneurs that were trying to build legitimate things in the United States and that the government and these people just continue to crush them and beat them down and beat them down and charge them with things until they just create, because they were talking about Trump meme coin, until they just created meme coins because those had no utility.

And he was like, the irony that anyone trying to do good and build something real got crushed, I believe he said, into butter. And anyone, so they just started launching meme coins, which are stupid and have no utility, as he said, and got rich. Right. And he was like, so that's amazing. He gets it. He's like Trump. The Trump token is a symptom of the way that the United States has approached the crypto industry over all this time. I thought it was really pretty powerful, especially to be watching that on CNN. You know, it was. Yeah, he gets it. I love it. That's great. I mean, it would have been nice if he said something nice about it for the last, you know, seven years, but I'll take it now. It's still good. You know, sometimes it takes losing to cope and take a deep look for anyone you know in any political party i got i got

some flack from friends because i told them go to the stand with crypto website and in our area um actually like it just so happens where i live in southern california there were more democrats that were pro crypto than the republicans in our area and i think people got used to just saying blanket across the board vote republican because they're better for crypto. But it's just it just depends. But also in the next jurisdiction over, we have our good friend from the Financial Services Committee. What's his name? The worst of them all. uh no um why am i uh but um yeah somebody somebody get me i'm my brain is just too talking about brad sherman yes brad sherman yeah cobra coin mom bush cobra coin so i i have been writing um these op-eds for the local business paper here. It's like the San Fernando Valley Business Journal ripping Brad Sherman for literally like seven or eight years now. And I tried to flex on him that I run this startup group called 805 Startups in Southern California that we have a few thousand

members and most of them live in his jurisdiction. And the dude has literally, I could have probably pushed harder. I could have showed up at his office or something, but I got real work to do. But his office never respond other than a polite decline to meet or to talk to the group. I told him they could pick a moderator. I just wanted him to explain

why he doesn't like crypto in a little bit of a longer form than what he does in Congress. And he wouldn't show up for like seven years. Of course. It's funny. It was like in December of 2022, right after FTX, I kept going on mainstream news channels and basically defending the industry over and over again. But they Yahoo finance made the horrible mistake of putting me and Brad Sherman on basically back to back. So I didn't know I was going on as a guest or like, here's your topics.

And then I go on and I'm watching Brad Sherman, like absolutely eviscerate the industry. And then he goes off and they bring me on and they're like, what do you think? And I just went, I mean, I went to like completely ballistic to the point where this woman, like they had to take the news anchors face off because she was so shocked at how like aggressively I was going at him. He's absolutely, absolutely, absolutely the worst. So listen, we got Simon and Amateo with their hands up. Amateo,. Happy to be here. With Trump, and I think the idea that everyone's

kind of on the edge of their seat waiting for these executive orders, I think the real question in everyone's mind is, is crypto a priority? And it's very obviously yes, building on what these said um with with like having a new sec focus on crypto regulation with having the cryptos are and david sachs with launching trump coin two days before he gets inaugurated clearly this is a priority clearly we have a lot that we can anticipate and expect. It's not all going to happen on day one. People need to be patient. People need to see the forest from the trees here, that there is so much moving in the conversation around this. And we're also seeing that very, very clearly, Trump is working to honor his promises.

He did that with Free Ross. It'd be really curious to see if the first part of Free Ross was involving getting him out of prison, the second part being Silk Road funds, being the core contributor to the US's strategic back reserves of Bitcoin itself, because that would be an interesting kind of chain of events um but i think overall like america's back right like the uh crypto.com announced the new u.s institutional investment platform uh we have uh circle ceo talking about that he does believe executive orders are coming um overall yeah i'm gonna pin a tweet on that for people to see that really quickly. Keep going.

Yeah, that just happened. So there's an anticipation from insiders who are involved on the ground floor of what's to come. Everyone who's actually involved at the policy level who are a part of this is basically hyping up what's to come. It's everybody who's on the outside looking in impatiently that are being overly eager of what's happening. So this is happening now. And I just think the priority is really clear. And just to take a moment to recognize what a big deal it is that we're going to be able to legally build in America once again and that we can starting today. It's just huge for the industry. I don't think that huge for the industry i don't think that's priced

in i don't think that's felt and i don't think the actual innovation that's going to emerge from the juxtaposition of ai and crypto um in this cycle uh has been fully realized um maybe we're actually still really early. Yeah. Simon. Hey, everybody. It just feels so awesome with the Ross Ulbricht. You know, that was just such a great moment with everybody, you know, wondering, is it going to happen? The disappointment and then the big thing. So, you know, it really is a Bitcoin story.

Bitcoin represents freedom. Ross is free. And now it's completely ironic that America might get a Bitcoin strategic reserves using the Bitcoin that Ross Ulbricht put together for the American people in order to potentially one day free it from the clutches of the Federal Reserve and the European bankers that took over the American dollar in 1913. So I really look forward to seeing this story unfold. But I also just wanted to say that as somebody that has been operating regulated business, building Bitcoin security since 2010, we built three broker dealers fully regulated by the SEC, and one by one just

couldn't utilize them. And so although there is all this change that is needed, there is actually a massive amount of pent-up demand from broker-dealers that already comply with all sorts of regulations already that would love to just engage in this industry and use common sense in order to make sure that the rules that exist within the traditional financial sector are also applied to this decades and decades of experience of selling securities and investments. There is already a virtual asset registration for broker dealers, we applied for it and got no answer from the SEC for years and years and years. They already then released a special purpose broker dealer. And we spent millions and millions

trying to apply for it and got no answer. We also ended up we we ended up having to sell our ats which was to you know create and sell bitcoin bank based securities we sold that to coinbase coinbase had the licenses all along i know because we built them at bank to the future and sold them to coinbase and they always wanted to comply and use that ats and broker dealer But they just couldn't use it because anytime they tried to use it, it wasn't possible. So just having an environment of the staff that are willing to look at all these applications and use all the laws as they exist today would already be a sea change of opportunity for all of the broker-dealers that exist out there today. We've already got ETFs. They can sell them. They can do all this stuff. So even if nothing happens,

just having a regulator that says, this is something we want to embrace and this is an opportunity for our country, actually doesn't require any changes whatsoever. Add to the fact that you're going to do things better, and it's a real great opportunity and just an exciting thing to finally see that America can just embrace this, even with everything they've got already. Yeah, I mean, Matt, does it really feel like all systems go? I mean, we talked this over and over again, and maybe you and Andre both can take this i guess from a bitwise perspective but you know we had this sort of initial take that trump launches a meme coin that means any and anyone in america can do exactly what he did and keep 80 supply uh supply and you know uh it's full yolo over here and then

we had a couple lawyers say hey it's not going to be legally defensible to say the president did it, so I did it. Right? Necessarily. So I do think we're going to have some rules here still. Absolutely. And we want some rules. I think one of the emergent risks in crypto is if it's truly a wild west and we get the best things and the worst things all together, could that crack confidence in the market? That's something I'm concerned about. But my take is, you know, we'll get some rules. Once you get below the political level at the SEC and you start engaging at the staff level, which are the non-appointed people at those agencies. You know, those tend to be very serious people that certainly follow the gist of where the politically appointed leadership is pointing them, but still understand

how the laws work and apply them. So I do think we'll get rules, but it is more open than I thought. And it's open faster than I thought it would be when Trump was elected. Usually it's the case when you have a new administration come in, there's sort of a holding period at these regulatory agencies while they wait for the political leadership to be appointed and confirmed by the Senate and they don't take big steps. But that's not what's happening at the SEC. So the short answer is, at least from the US, and Andre can speak from Europe, there will be rules. It's not going to be a regulatory free-for-all. That is correct. But it is more open than I anticipated a week ago. And it's open faster than I anticipated a

week ago. And you're starting to see that from a product perspective in all the filings. And I think you'll see that sort of accelerate as people start to explore things like staking and in-kind and other things. Andre? Yes. Hey, happy to be here. And happy Free Ross Day. So from a legal perspective, I think,

I mean, in Europe, we have the MICA rules, right? The Marks and Crypto Asset Regulation. And it's been in place since the beginning of this year. But what you can generally see in terms of regulatory developments is there's usually some lag between the regulations being put in place and corporations and households acting on these regulations about, I'd'd say 12 to 18 months what we observe in europe so there's probably some time lag before you see some like serious projects maybe in america it's it's a bit faster right because of the entrepreneurial spirit but

i'd say yeah usually there's there's a bit of a time lag. But maybe a last comment on the SBR. I think, you know what worries me a bit about the SBR? So, I mean, if you just watch guys like David Bailey, right? He's been tweeting, it's happening. It will be included in the first rounds of the executive orders, right? And Jeremy Allaire just said the same, which is pin above. Exactly. So, and then now he backpedaled.

He said, like, oh, okay, it's still happening, but it will happen in the first 100 days, right? So he backpedaled. I mean, we've seen the polymarket odds decline, right? From cryptocurrency executive orders within the first week i'm having a look right now it's 28 so it declined from around 70 in the first week to 28 right it's still high for 2025 but it's declined generally but maybe i mean that being said maybe we don't need the sbr at least not. Because if you just look at the amount of buying by ETFs,

I've just tweeted it out. Over the past five trading days, US-bought Bitcoin ETFs alone bought 31,500 Bitcoins, right? It's crazy. It's like 15 times the amount of new supply within five days, right? And we know MicroStrategy, they've just bought 11k bitcoins, corporates, they've been buying around 70k since the beginning of this year. So there's a huge supply deficit that that's our

narrative and spin our narrative for maybe the last six months. I mean, and also think the big difference to march 2024 because people keep like saying um keep saying like ah maybe this is a cycle top right we see kind of consolidation there's too much froth in the market and so on but if you look at march 2024 the post etf period right when we had this long consolidation, I mean, exchange balances, they drifted higher, right? And same was true if when we have this capitulation in August, exchange balances drifted high, we had new supply coming online. But now, if you look at exchange balances for Bitcoin, they continue to drift lower, right? And that's why I'm saying maybe

we don't need the SPR right now. I mean, maybe they should work on this bill, right? That's originally planned. And in the meantime, it will serve as some kind of magnet, you know, for the market to move higher, right? While Yeah, the supply deficit continues yeah i'm gonna be more negative than most on the sbr in that you know i think uh you know at the end of the day you know the u.s is able to do what it does you know and have the life that we have because of the u.s dollar because we can you know the rest of the world has to suck down our dollars today and And undoubtedly, the biggest threat to the dollar is Bitcoin. And I think as Trump, I don't know how much about Bitcoin Trump really understands. But wouldn't they want to control it? I mean, even in a cynical view? Yes.

Oh, exactly. That's the whole point. He would want to control it, but you can't control Bitcoin. Nobody can control Bitcoin. That's the whole point of it. but you can't control Bitcoin. Nobody can control Bitcoin. That's the whole point of it. That's why I'm here. That's why Satoshi created it, was because he didn't trust government any more than I trust government, whether they're Democrats or Republicans. They are not our friend. Yeah, that makes sense. I would say.

Yeah, to touch on that piece, I think one thing to consider is that Trump does have some really quality advisors and economists around the SBR. Do you think they helped him with the Trump token? Do we know? That was his degenerate children, for sure. That was not. Which is the only people he trusts. Right. I don't know that. I know that he's built a cabinet and a group of people around him that he, you know, I don't think David Sachs was advising on the Trump token. I don't think Cynthia Loomis was, right? So when we look at the SBR, I do think that there is a chance that there is a strategic positioning that they need to put in

place before just going ahead and doing this. I don't think it's as clear cut as just signing an executive order if you're going to do this properly. Trump obviously operates very hastily. So I wouldn't be surprised if this is off the cuff or moves very quickly. I also would counter Lou's point that I don't think it's a threat to the dollar. I think that as we move into the AI age and everything else, we're looking at a hybrid reserve strategy to back US dollar and policy. And there could also be a factor in how do you implement a hybrid reserve strategy and use it to strengthen the dollar rather than use it as a threat to the dollar, which has been the very thing that both stable coins and Bitcoin have been rallied against from congressional members saying that it is a threat. So

I think we all know from spending enough time in this space that it doesn't have to serve as a threat. It can actually serve to bolster the US dollar. But I do think there has to be an infra plan. There has to be an acquisition plan. They have to evaluate all the Bitcoin that's in the US balance sheet that they can allocate to the strategic reserve. Obviously, other countries are making preemptive moves because they don't want to get priced out, anticipating that this is happening. We also don't know what kind of acquisition strategy they're approaching to it. So I just think that, you know, we were all very eager, and we just look at this as this cut and dry thing that you just say that you're going to do this,

but I think it's far more complex. And hope is that they're being uh very strategic about how they approach this i mean mic issues uh here as usual and that's uh not not not a surprise here i'd actually try to lift the mic and it doesn't exactly work go ahead yeah sure um i'd refute that i hope that um trump has the right advisors because if somebody's advising him that bitcoin competes with the dollar um they're not actually giving the correct advice the reason for that is you've got to work through the what bitcoin is bitcoin competes for savings i don't think many people are choosing between saving in the dollar and saving in treasuries. Treasuries is a way of having US credit rating generating income. It doesn't do any of that. It protects you from any government risk, any counterparty risk, and it doesn't generate income. And so

what really competes with the dollar that I think the Fed would really be concerned and government should understand as well, and anyone advising, is actually stable coins, because the stable coins actually go direct from government debt, treasury to blockchain asset with no fractional reserves. That's incredibly disruptive to the banking system. And so really, stablecoins competing with Federal Reserve Bank digital currency issued by the bank as credit is actually the real competition. Now, how do you manage that competition? Well, what you do is as you transition from a federal reserve system to a government direct to blockchain asset, or you have a hybrid model of CBDC stable coins and bank credit

digital currency, you actually hedge. And the way you hedge is that the government, not the Fed, owns a reserve of assets, i.e. a Bitcoin strategic reserve, in case the dollar ever needed to be restructured and there needed to be backing behind it if we ever moved to a hard money standard in the future. So for me, I am way more likely to buy treasuries by purchasing a stable coin, if I know that America is the country that has the largest Bitcoin strategic reserve. And so I know that the Fed knows that. But does Trump and the administration know that? Because if they did, Jerome Powell would make sure that you are scared shitless about the opportunity to hedge the dollar from the Federal Reserve. And so it is actually a strengthening, a complementary,

and anyone that thinks otherwise hasn't quite figured out what Bitcoin can do for countries that want to protect themselves from central banks. So Simon, assuming that everything you're saying is true, then as every country creates their own strategic Bitcoin reserve, aren't they now better competitors against the dollar? Absolutely. So America not doing it makes the dollar worse relative to other countries that might be able to create something that's backed by a hard asset. But if other countries back a much higher percentage, then the other countries are going to be actually better alternatives to the dollar. Correct, which is why America needs to make sure that they protect their position now by having a Bitcoin strategic reserve.

But they can't. There's not enough. There's not enough Bitcoin. That's not true. That's not true. You don't need to back your Bitcoin right now. Yeah, there's a $2 trillion market cap, but you don't need to back it. A strategic reserve is about if the Federal Reserve System collapses or the banking system collapses and nobody will buy those treasuries anymore in order to bail out the banks, then at that stage, and if the Federal Reserve can't print because it creates a hyperinflationary environment, then you can restructure the dollar from treasuries using your strategic backing. This is about contingency planning to make sure that the dollar always has its place, despite the actions of the Federal Reserve. I say sorry. Sorry, I think that there are many angles to this. I

mean, the declared goal, as we all know of the strategic reserve is to pay back the debt, right? So they're implicitly saying, we'll back the treasuries with Bitcoin, right? We hold it for 20 years and the goal is to retire government debt. And so I don't think they're... Is that, have they ever said that? I don't think they ever said that, did they?

Yeah, they said that. But if they do, that's a Great Depression because that's literally wiping out the dollar because the dollar is backed by debt. So if took out 36 million dollars maybe just one example so we know el salvador adopted the bitcoin standard in september 2021 right what happened to their credit rating since they've adopted the bitcoin standard? Might be a coincidence, but their credit rating went from CCC+, right? Which is highly speculative, near to default, right? In July, 2021 to B minus, that's January, 2025, right?

So they're still junk, right? They're still considered to be non-investment grade, but they're close to investment grade. So their credit rating has improved significantly and their default probability, if you look at Bloomberg data, has also decreased from 20% one-year default probability to 5%. I mean, there are many reasons for this, GDP growth, increasing tourism and so on. But my take is also because they are bolstering their FX reserves, they are also backing their foreign liabilities with Bitcoin. They had this improvement in the fiscal debt situation

and decline in sovereign debt default probabilities, improvement in credit ratings, decline in sovereign yields, and so on. And I'd say this could also happen to the United States. So they could decrease default probabilities, right? Markets would start pricing in lower CDS and so on, right? Credit default swaps and so on. I mean, El Salvador is a good example because CDS have been declining, right? Default probabilities.

And I'd say if the US starts implementing a strategic reserve, you'd probably see a better credit rating and so on. That's just my expectation. Matteo. Yeah, I agree with the strategic Bitcoin reserve. I actually want to go back to stablecoins and a question for Simon. I look at the stablecoin environment and I look at upcoming regulations, Circle talking about proof of backing and Brian Armstrong talking about the future of how stablecoins will need to have proof of reserves to justify their backing to be approved in America. We also have, as you were saying, Simon, that we have potential regulation that could come through allowing banks to custody crypto for broker dealers to immediately onboard. on board they've had time to prepare and what i see here is actually the ability to do a order of magnitude leap in the actual financial rails by utilizing stablecoin that actually makes the

us dollar one of the most efficient um assets in the world by using stablecoin rails that at some level have, whether it's proof, settlement, some kind of connection to the Federal Reserve. And I don't see how faster, efficient, greater circulation, greater adoption, utilization, and economic transaction volume of US dollars that are stablecoin-oriented being a competitor. And so I'm just trying to really understand that position. Yeah. Basically, the entire history of central banking is to maintain control over the issuance of currency and back it by credit for private banks so that the treasury and the government can't issue their own currency independent of the central bank. So essentially, fractional reserve banking is confiscation of the profits from scenerage and money creation

over to the private banking sector. And so if treasury, the government, figures out that they can benefit from the profits of creating the dollar and they don't need to hand it over to the private banking sector, then the Federal Reserve will do whatever it can in order to maintain that control for its shareholders, which are the private banks that issue the digital currency back by credit at the moment. And so that is a friction. And that is the entire history of the fight between government and central banking over who profits from the creation of the dollar. So stablecoin takes the banks and the Federal Reserve System out of the equation. And I think they would rather have a central bank digital currency than allow for private issuance of stable coins that bypass the banking system and are much, much more efficient and better for Americans. They'd much prefer that it's better for the banks that have a cushy Cineridge subsidy. And that's the reason why indebtedness is so high because of that friction. Awesome conversation so far, guys. Obviously, everyone I think viewing is great news that Trump has pardoned Russ Ulbrich.

Deep conversation here about stable coins, which I've long sort of argued are the killer app of crypto. But I think that now sort of the shift in focus has been to the intersection between AI and crypto. I've got Sujit here and Gaurav, both Sujit, the CEO and founder of Brain Alive. So just to give you guys some context, they were actually on my YouTube show this morning. This is not a sponsorship. It's nothing like that. There's no uh as a as of yet this is just the coolest uh intersection of uh crypto and ai that i've seen and well uh frankly this is my show so i'm gonna talk to them because i think it's cool and i think you guys will uh get some uh really good alpha out of this so maybe sudi if you could just break it down exactly or gorov either of you i see gorov what's up man are you still out in the streets of Davos in the cold?

I can't hear Gaurav. Gaurav, are you there? Yeah, I can. I think there's a little lag. Yes. Sadly, every time I have to talk on a call or a space, I have to step out in the cold. Can you hear me? Yes.

Yeah, we can hear you. And yeah, go ahead. So quickly to cover on the crypto side because the audience need uh needs a good crypto cover before they're shot onto science uh like scott said the this is a unique economics of its type uh you know the founder sujit being uh working with nasa and uh you know almost getting NASA and almost got his green card and extraordinary visa heading for citizenship. We wanted it to be a hyper-compliant token structure.

So there's like zero token supply, zero allocation, zero mint ever in this token in the past. The first token ever created would be essentially to the user using the product, submitting their private data to the decentralized storage and marketplace and verifying that data to be human

for at least one hour. That is when the first token is printed. And yeah, so there's like, that's the whole supply of the token, the most fairest distribution and the most verified distribution ever. So that's the crypto side of it. The blockchain side of it is the biosignal data that is produced to the hardware and AI that Sujit is going to talk about is submitted into a decentralized storage that is gatekept by an NFT, but of a sort of slightly advanced type,

and then connected directly to the data marketplace, the biosignal data marketplace that is available for not just Brain Alive to use, but is available for any institution for research or industrial or commercial purposes. And then every time this data is accessed, the user has to authorize and in return get incentivized by the network directly in the form of tokens. So I think that's the blockchain and crypto side that I wanted to cover quickly

as TDFi and partner to Brain Alive. I'd pass on to Sajid for the science side of it. And just a quick little warning, this is not an AI meme coin that is

producing funny content on Twitter and here and there. It is a real multi-model AI built from scratch by one of the most celebrated AI

researchers in the world. Over to Sajid. Hi, thanks, Kaurav. I assume you can hear me? Yeah, we see you. Right, perfect. So thank you, Gaurav, for summing it up. But in a very quick sum up, if I tell you then, Brain and Live AI, we have been working in this domain for last seven years approximately. And we have been working with neuroscience primarily and computer

vision and natural language processing. So the intention was to understand human engagement and intent and we have moved towards looking at intention to create the largest data layer for medical and health data which would help the by health notes so what we are doing is we are providing the state-of-the-art smart variables and through which people can actually collect the data, you know, provide the data and they can also make the money with it. So what we are doing in the terms of health domain is we are tracking a lot of things that I think you might compare it to or or something, you know, ordering or some other marketplaces

where you are looking at blood oxygen, sleep tracking and body temperature and animal to more features. But with the help of AI, we have we have been analyzing this data and this data will feed we create a personalized AI system for every user where it can provide a recommendation based on how what's your readiness level and what how do you how are you performing or how you can to perform which can be utilized for best use case for your day so right now we are doing the buy health notes and we are going we are selling that as node operator

licenses in the form of erc721 nfts um this license will actually allow the users to contribute to the data layer for the biosignals and the best part is that they will be able to earn rewards through it so we have seen to the ai domain and formerly like ai being centered or centralized in a fashion where one company majorly governs all the data as well as the model and the user community doesn't benefit of it so brain live has gone a bit aside on that where we we are trying to we are having a decentralized system where the user will come you know provide the data which will be verified and with with a huge amount of privacy user privacy being taken so you will be able to you know there is blockchain transparency and digitalization but you have like zero knowledge and uh you know homomorphic encryption to uh provide privacy for

the user in a very you know in a nutshell so uh right now it is a white listing after public sale uh where we'll be starting on 15th of February to 31st March. People can go on the, you know, buy website and then just sign up for the, you know, whitelist. And then they can create an account to get the, you know, token, which will be approximately launched in April 2025. So we have right now the health notes, which the user will be using. So you will be getting a ring for free. So there is a buy ring that we are providing that people can check on the website. It is for free. And the subscription to get the analysis from these things will be free for the first year as well.

And for the consecutive years, you can use it to buy tokens that you have earned which is approximately 800 tokens if you just uh we are it for a full day so it says uh and then you need to utilize it for the other year subscription and other stuff uh through the buy so we are having a one ring and then we have foci as well which is our chrome extension to analyze uh the user feedback and engagement i'll take a pause uh for any other feedback questions yeah i gonna say, so at a very basic level, obviously, pretty deep in the weeds, you've created a software, right? With a hardware element that's similar to an Oura ring, which is massively popular. Obviously, they've sold millions and millions of these things that track your sleep, your biomarkers, basically all of your biological

data to help you improve your health. But yours is combined with AI and therefore is much more actionable. It doesn't just tell you what your data is, but it actually allows you to take action to improve it because the AI is constantly improving and giving you suggestions on what to do. And that ring acts as a node effectively. And the only way any token will ever come into existence is directly to the user who is using that node and ring and that user will then own all of their own data unlike any of these other companies that are selling or utilizing your data in a huge database you'll own and control how that data is used all in a decentralized manner that's a pretty good uh yes yes very very well summarized and very well said as well so uh that's very true that company doesn't hold any tokens like i don't have any tokens yet so the company already says this is not vc funded or

something so the token will be minted when the data is being provided uh and that the user agreement and other stuff uh where the data quality will be checked and then the user will be rewarded through that uh so this is something fundamental that we are looking at. And the best part is that what you said is it's actionable, right? So it's not just monitoring that you will look at it and you will be like, okay, what do I do with it? It's more of actionable item here, which will provide you feedback on how you can improve your health.

And you can get up in the morning to tell your readiness level and how you can improve that in your overall daily performance so that recommendation engines as well as ai engines feed it uh which is going to optimize for a personal or you can say uh user-centric development so if you wear it for a full day uh or for a month then the ai will become more personalized to scott uh compared to what it would be for other people, right? So it is a very personalized AI assistive tool in order to provide you better feedback and unlock the potential of a human being, right? So it's like biohacking, but trying out intimidation or biohacking, what people can do to get that thing going on.

Yeah, I just find this absolutely incredible. So, and I assume that with time, the AI will learn more about your behavior, become more customized, and it won't be at all general, like I guess you would see with something comparable. It'll be very much tailored to exactly what you need on a, you know, daily or hourly.

That's very correct, yes. So it's not generic, like how it will be treating the whole of a population or like it's a one device that is catered to all. I'm like one clothes size doesn't fit all right. So it is very catered to, you know, having a personalized assistant to help you improve based on your activity and daily routine in order to understand how you function and then provide your feedback to improve that actually. So it is not going to be very compulsive or drastic changes in your daily routine, but it will be a subtle changes in your daily routine without affecting any outcome of the, but it will improve the performance of how you function. Honestly, I want to know, we have like two of the best crypto VCs on stage. I know it's not my intention. I want to know what Alon and Lou think of this,

or if you guys have heard of it. Have you guys heard of this before? I've hadn't heard of this exact product yet, but I love the idea of, think about like everybody, not everybody. I'm an insane person who hasn't worn a watch since I was in like sixth grade, but most people wear Apple watches. They give all that data to Apple, all of that Apple health data sitting there.

They don't get rewarded for it. They don't get anything. And then I think that as a large organization, Apple probably can't give the best recommendations, right? Because there's probably all sorts of legal liabilities for them, but a smaller company, especially if you opt in, could probably give you better personalized recommendations over time. So, the general idea sounds awesome. I'd love to see more and stuff. I did see somebody who

had an idea. I've seen a few people with similar ideas, but all of them were contingent on you continually sharing your data, what you ate, what you did when you woke up and all that stuff. Like entering it into a journal. Yeah. So, it's like a journal thing. And maybe there's a bunch of wearables people use now, not just the Apple Watch. And I know there's like, what's that one? There's that one app that's actually really crappy, but everyone uses because it just has all the stuff like my fit, something that people use for dieting and stuff. Um, I remember researching that and seeing it, but, um, again, I like the idea of like

throwing on a ring and then never, uh, and then it just go and like, yeah, drink more water. Exactly. I'll go back to go over and shoot you in a minute. Just Lou, have you met these guys or heard of this? I'm just curious here. No, I have not heard of it. I'm super impressed.

As you know, I'm all in on the intersection of AI and Web3 and AI agents. I'd really like to understand how they're going to scale. Can you tell them a bit more about that? I knew with these guys on stage, we'd get some good insight. Yeah. So somehow I missed his last sentence. Sometimes you can't hear people. He basically asked what the

what the, they were exceptionally impressed. I know that Lou is very deeply an AI agent in this intersection. He was asking how you intend to scale. Is that correct, Lou? Exactly. So, Lou, thank you.

Thank you for the question. The question is actually great. So in terms of right now, you know, we are using decentralized blockchain where the people will be able to, you know, buy the nodes and you're using those computes. So for doing that, so it's fundamentally we're using edge computing as well. So it's not much compute intensive for the company to calculate all of these parameters and other stuff.

So I would say that these models are not very heavy in terms of processing as we see from other you know, on this perspective. I'm sorry, I wasn't asking how you were gonna scale technically, how are you gonna get people to actually try it and use it? your foundation on this perspective. I'm sorry. I wasn't asking how you were going to scale technically. How are you going to get people to actually try it and use it? Okay, yeah. So right now we have, initially when we released it,

we have a lot of 200,000 users, more than that, already whitelisted signed up for this one. And right now we have also opened up the portal where people can go up and sign up for the whitelisting capacity. So they can go on the sign up for the whitelisting capacity. So they can go on the sign up and then they will be able to create account and get into it. Further, the best part is the reward mechanism. So when a user share, you know, with somebody else, they will be rewarded, you know, a percentage of that. So it's 30% reward.

For example, let's say that you share it with somebody as a referral, then you get 30%. But you also get the 30% of the network of that person. So if that person is again, referring to other pokes, you will be able to, you know, get tokens of that. So through this method of, you know, engagement policy, we're thinking of getting as many users as possible in the beginning. And we have a very limited number of node cells that we are aiming for in the first version to go with. Very impressive. Yeah, it's pretty incredible. Already hundreds of thousands of people. You know how we do things. Long time. Yeah, everything Gaurav does is impressive.

So listen, I guess the next natural question, Sudheed, and just so people know, I pinned a tweet from BrainAlive underscore AI, which you guys should all follow above, which kind of explains a bit more. You get the free ring with the node, which is amazing. It's at node.baai.co slash sale. But that is above in the tweet. Sujit, is that the best way for people to check it out? Is that how you get on the whitelist? Yes. So they can go on there

and then they can sign up for the whitelist and they will be followed by the pages to create an account and subscribe. So they will be able to do that. Rohar, any other thoughts there? I didn't listen to any of that. You've been blocked by the World Economic Forum in Davos.

Of course, if you talk about, if you advocate decentralization in this world of, you know, old age 90 plus people of, you know. Yeah. Kaurav, you're breaking up, man. We can't hear you, unfortunately. Sorry. Sorry. You're in the glitch. Yeah. Yeah. Again. Yeah. Kaurav, you're breaking up, man. We can't hear you, unfortunately. Sorry. Sorry. Can you hear me now? You're in the glitch. Yeah, yeah, again. Yeah, I'm saying if you're talking about decentralization, privacy, control of data, control of life, and universal basic income generated through your own work and data, they won't like it. They have to block range. It's hilarious. I think it was the highlight of my show ever.

I was having you on the streets of Davos like a local reporter today, which we've never done in the freezing cold as people walked past it. It was definitely a highlight. All I can say here, guys, what's being built here to me is massively impressive. Like I said, I have no financial interest in it. There's no token.

It's just something Gaurav had presented to me. And then I was so fascinated. I met with Sudheet to discuss it and obviously signed up and I'm waiting to get my ring. Just find this incredible and fascinating. And I encourage all of you who are interested to check out that tweet above. Again, node.daai.co. slash sale, I believe is what it is. And if you're interested in seeing more about this,

to dig into their GitHub and everything they've got going on, there's so much here. I just find it fascinating. And, you know, it's really important every once in a while when we get something

we're excited about that we can kind of take the opportunity to share it on this show. So, Gaurav, Sujit, thank you so much for joining. Thank you. Emeteo, thank you so much for joining. Thank you. And Matteo, Lou,

you guys are amazing. Yeah, you're welcome. And obviously to the rest of the panel, you guys are amazing. Love to have you. Looking forward to doing it again. Guys, we'll be back 10, 15 a.m. Eastern Standard Time tomorrow

with the next edition of Crypto Town Hall. Thank you, everybody. See you tomorrow. Bye. Thanks, guys. Cheers.