The Wolf Of All Streets - Why Regulation Is Bullish For Crypto | Oliver Linch, Bittrex Global

Episode Date: March 21, 2023

In this episode of the Wolf Of All Streets podcast, I sit down with Oliver Linch, the CEO of Bittrex Global, a leading international cryptocurrency exchange. With his background as a former financial regulation lawyer, Oliver brings a wealth of knowledge about the intricacies of compliance in different jurisdictions. We discuss the challenges of navigating US regulations in the cryptocurrency industry and why Oliver remains optimistic that the US will eventually develop the best regulatory framework for the space. Tune in for this insightful conversation and much more. Oliver Linch https://twitter.com/OliverLinch ►►THE DAILY CLOSE BRAND NEW NEWSLETTER! INSTITUTIONAL GRADE INDICATORS AND DATA DELIVERED DIRECTLY TO YOUR INBOX, EVERY DAY AT THE DAILY CLOSE. TRADE LIKE THE BIG BOYS. 👉 https://www.thedailyclose.io/   ►►BITGET GET UP TO A $8,000 BONUS IN USDT AND GET MASSIVE DISCOUNTS ON TRADING FEES! 👉 https://thewolfofallstreets.info/bitget    ►►NORD VPN  GET EXCLUSIVE NORDVPN DEAL - 40% DISCOUNT! IT’S RISK-FREE WITH NORD’S 30-DAY MONEY-BACK GUARANTEE. PROTECT YOUR PRIVACY! 👉 https://nordvpn.com/WolfOfAllStreets   ►►COINROUTES TRADE SPOT & DERIVATIVES ACROSS CEFI AND DEFI USING YOUR OWN ACCOUNTS WITH THIS ADVANCED ALGORITHMIC PLATFORM. SAVE TONS OF MONEY ON TRADING FEES LIKE THE PROS! 👉 http://bit.ly/3ZXeYKd  ►► JOIN THE FREE WOLF DEN NEWSLETTER, DELIVERED EVERY WEEK DAY! 👉https://thewolfden.substack.com/   Follow Scott Melker: Twitter: https://twitter.com/scottmelker   Web: https://www.thewolfofallstreets.io   Spotify: https://spoti.fi/30N5FDe   Apple podcast: https://apple.co/3FASB2c   #Crypto #Regulation #Bitcoin Timestamps 0:00 Intro 1:20 Bittrex, US & regulation 9:45 US regulatory problem 17:45 Crypto scams: the process of clearing out 22:35 Silvergate bank 25:20 If you are right you win 29:18 Custody issue 32:30 Read the disclosures 35:00 Crypto for the unbanked 37:52 Stablecoins 39:55 Tokenized stocks 42:00 Institutional adoption 45:10 Why Oliver believes in crypto 47:05 Wrap up The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. This video was created for entertainment. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this video constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.

The most important topic in the crypto space in 2023 has been regulation, and more specifically, the uptick in regulatory action from United States regulators. But there are companies and CEOs like Oliver Lynch from Bittrex Global who don't have to think as much about what's happening in the United States because they operate in other regulatory jurisdictions. We talked about how this gives them opportunity, but also makes it very difficult to operate still with the United States offering little to no clarity. But we also

talked about the amazing future of crypto all over the world. So I guess the first question has to be, in this economic climate with the crypto market all over the place, how's business? What a question to start off with. Look, people ask this all the time, right? And depending on how friendly they are, they mean different things. Business is rocky, I think it's fair to say for the whole industry, but there are some clear areas where I remain cautiously optimistic. So let's take a few of these big things that are going on and have a look at how I think of them

as CEO of Bitstrips Global. And it's worth saying right at the very beginning that one of the great joys of that, as I often say, is that we are outside the US. Our entire existence is premised on, we don't have any US clients. We don't allow any US citizens, wherever they are in the world, to become members of Bitrix Global. And we don't even allow access to Bitrix Global platform from within the US. So I sit here from a slight area of cushion from some of the recent goings on in the US. So against that background, look, one of the big talking points for the last few weeks is obviously the SEC, and now it looks like a few other regulators, renewed enthusiasm for regulating or taking aim aim at depending on exactly how you want to phrase it uh the crypto industry i i'm not a u.s lawyer um and i officially i'm a uk lawyer

and and i officially have no view whatsoever on whether any of these things that the sec or whichever other regulators really says are securities or not but what i will say is you know i've got friends in the industry that say oh you know gary kensler's an idiot he's obviously wrong he's misunderstood like gary kensler is an incredibly smart man the sec is filled with incredibly smart lawyers who know what they're doing and are acting in good faith so So let's start with that. And then you say, well, okay, so you've got this bunch of incredibly smart, well-intentioned people and this bunch of incredibly smart, well-intentioned people looking at the same laws and the same facts and coming to completely opposite conclusions. And what that tells me is there's a problem with the system. The rules are not working

and are inappropriate. And that's not surprising because we're working with an act or they are working with an act that was passed 90 years ago. Something that's passed nine years ago in this industry is seen as woefully out of date. If FDR when he signed the the 33 act envisaged the emergence of blockchain technology and and cryptocurrencies like great he's an even bigger genius than we all gave him credit for but what is the SEC and what are these enforcement agencies supposed to do like that's the tool they've been given and if all you've been given is a hammer the whole world looks like a nail so you know, that's what's going on. And so what does that say?

Well, that says it's Congress's fault. It's the regime that they're operating under, the framework they're operating under, is simply not fit for purpose. Now, what does that mean for BitTree? It's global and for the sort of rest of the world. well it's what we've been saying all along which is that the most successful regulatory regimes are the ones that regulate crypto as crypto engage with crypto on its own basis and we've seen that in lichtenstein and and which was then adopted to form mika in the eu we've seen that in bermuda which is why we got ourselves regulated there an early adopter of a bespoke regulatory regime that says okay what is a digital asset what are the risks associated with that how do we regulate it and how do we allow people to engage safely

so the big winners from this debacle i think it is a there's a big problem with doing this kind of enforcement by regulation by enforcement thing which is the old legal accent at maxim which is um bad cases create bad law right and it's kind of true and i go back to my very first day at law school right day one of week one and they say well what's the point of law and the answer is it regulates interactions between people it allows me to interact with you It allows one company to interact with another company. It means that if I sell you an apple, you know that you're going to get an apple. The apple is not going to be poisonous because there's going to be some kind of food standards around it. If I don't give you an apple, then you have some kind of rights against me.

And it's very basic level law allows people to interact with each other in a socially conventional way. And at the moment, it's failing to do that in the US because even people that want to do the right thing, and there are a lot of us, right? There are a lot of good actors in this place, a lot more than we get credit for. A lot more than bad. Yeah. Right? And a lot more than we often get credit for. They simply cannot do the right thing because they don't know what the right thing is. The law is failing to provide them with that framework for interaction. But the law outside the US, the law in Bermuda, the law in the EU soon, the law in Liechtenstein, is not failing to provide that guidance. In fact, they've created a structure.

And so I'm optimistic because the rest of the world seems to have woken up to this fact. So I've mentioned the EU with Mika, but in just recent weeks and months, we've had the UK launch a consultation paper, Dubai doing some really interesting things with Barra. Even Hong Kong now seems to be getting on board with the idea that you need to regulate crypto properly. So I'm kind of quietly optimistic on that front. I did not have on my bingo card for 2023 the United States cracking down on crypto while China loosened its potential regulation in stance. Yeah. I mean, if you had, I would have been very impressed. So you described, obviously, the purpose of the law,

to which I listened to it and say, if only there was an emerging technology that could solve for trusted third parties, right? Yeah, but that's kind of circular, right? Because people say, oh, don't trust people, trust the technology. And that sounds great. It's a really nice little soundbite, but it doesn't mean anything. Someone has to program it. We all know that. Someone has to program it. Unless you're one of the vanishingly few people,

and I'm certainly not, that can go in and read the code and understand what's really going on behind it, you are just trusting people. You're trusting the technology, but as of yet, it can't create itself. I mean, give that a couple of years and maybe... I was going to say maybe next month. Maybe it can.

5.0, yeah. Right, exactly. But for now, you've got to trust. You've got to decide what to put your trust in. And if the lesson you're taking from the scandals of last year, the FTX debacle and all of that, is that you're going to put your trust in less regulated institutions and less transparent places, you've learned the wrong lesson. And so people are like, oh, it's all about DeFi now. Centralized exchanges are dead. No,

I recognize I'm CEO of a centralized exchange. I would say this. But if that's the lesson that you've learned, you've really missed the point. Because what you actually want, if you're a big institution, a big bank or fund manager, or if you're just a guy who's kind of interested and wants to learn more, the only way you can do that with any kind of confidence is by having crypto regulated to the same standards, the same principles as banks and brokers and traditional exchanges. Of course, there's going to be differences in the way that works to reflect the technology, but the fundamental principles behind it need to be the same. That's how you win back the trust. And it's not stuffing your money behind a mattress. It's not engaging in peripheral and incredibly difficult to use and incredibly opaque DeFi protocols. It's saying, okay, you want to handle my money? Prove to me that you can do that in a safe and secure way and get an independent, well-respected, robust regulator to come in and supervise it.

That's what we at Bitrix Global have pushed for forever. That's one of our founding principles. I am happy for you that you can say exactly what you said as your disclaimer at the beginning, but it's really hard for me as an American to watch it happen, right? Because we've always prided ourselves as a country, I guess, on leading in technological advancement, leading in regulation, being open to innovation. And it feels like it's just being utterly stifled here. And there's almost no hope that that won't be the case in the near to mid future. What is an American to do? I know you're not the CEO of it, but Bittrex does have an operation in

the United States, right? It's not you. I know that, not the CEO of it, but Bittrex does have an operation in the United States, right? It's not you. I know that, but the company does. Sure. And let's be clear. It's not just Americans that are impacted by this. It's the whole industry. Because the fact is, some of the smartest people out there, the best engineers, the most innovative people are and will always be in the US. You have the best universities. You have the best programs.

You have the ecosystem, the infrastructure. The US could be a real leader in this space. And this clampdown, I think inevitably, well, there's going to be some people like, okay, let's go do this outside the US. But I reckon there's going to be a hell of a lot more people that are going to say, all right, let's just not do it at all.

Let's stick with our traditional banking. let's stick with the inefficiencies let's stick with um screwing a whole load of people that are disaffected and underbanked and underprivileged out of the opportunities of crypto and all right well it was it was nice when it started and that doesn't just affect the us that affects the whole world and, there are other obviously big areas of the world where there's innovation, there's a lot of excitement and activity, but without the US, the largest economy in the world, that takes a big hit and it sets the whole industry and the whole crypto project back a long way. Preston Pyshko, So how do you navigate that knowing that it's going to be impactful to the entire industry, but effectively, I guess, compartmentalizing that market separate from

everything else? I mean, you just go about your business and hope for the best because you're not operating there? Or are there certain sort of rules you have to abide by or follow to make sure that you're compliant and that your business can continue to run? Yeah. I mean, look, to an extent, you can only do what you can do. And unless and until Congress take a different view in the US, you kind of feel hopeless and you feel hopeless outside the US, and I imagine you must feel a hell of a lot more hopeless inside the US as to how to do it. I think now there are still a lot of people trying to make it work in the US, right? And I think that that will continue to be the case.

I think that there are going to be a lot of eyes on the Ripple action coming in the next few months or whenever the timeline has been set for that, there's still a game to be played out here. I don't think it's curtains by any stretch. And I think the ingenuity and the entrepreneurial spirit of America shows that when there's development to be done, when there's progress to be made, very often it finds a way to do that in the US. But the conversation about how to do that safely and robustly in terms of like regulatory protections has been had outside the US. So the big winners are, you know, I was privileged to sit down with the Premier of Bermuda last week and pointed out to him like the Digital Assets Business Act, ABBA, has just been

sitting there doing its thing, regulating crypto properly for like three, four years now. Well, that is a great beacon for this is not impossible. And all those people that say, oh no, regulating crypto properly is not possible. Like, yeah, it is. We know because we've been operating under that system that works. And it's really tough. It's really difficult. And, you know, my background is I was a private practice regulatory lawyer for over a decade doing financial services regulation in the traditional sphere right so i i understand what it means to be a regulated bank and a broker dealer or traditional exchange and and the answer is it's really difficult it's really

hard the regulators ask lots of annoying questions uh and they get all up in your business and you have to take difficult decisions and you have to turn down revenue streams because it doesn't fit within what you're allowed to do or how you're allowed to do it it's really difficult and annoying and so it should be right because that's the way that customers and markets are protected and there's no reason why those exact same principles cannot be applied to crypto but in order to get there this kind of this latent view which which did exist when in crypto, that somehow it needs to exist outside of regulatory environments, those things are over. Not anymore. Those places don't exist.

They need to get with the program. Well, unfortunately, they still do exist. They're few and far between, but they still do exist and they're very quickly being stamped out. Preston Pysh, the very fact that someone who practiced regulatory law is the ideal person to be the CEO of a crypto exchange says just how important being able to navigate the regulatory ecosystems and all of these different places is. Recently, I was on Twitter Spaces with CZ from Binance, and he said that his entire job now is speaking to regulators in different countries. I would say 95% and 5% is taking selfies with people for a good PR push, right? But 95% of his time, and we're talking about a guy who has built trading systems, built an exchange and traded, all he does is navigate regulation.

That is the job of being the CEO of a global exchange, it seems like. Sure. But that's the job of being CEO of the New York Stock Exchange or Goldman Sachs or any other number of- That's a good thing. We've matured. Yeah. Yeah. Absolutely. We're getting it. And too slowly. It's a real shame that it's taken scandals and people losing vast amounts of money and fraud and all the bad stuff to get there um but yeah like being the ceo or i before being ceo i was general counsel of pitchers global yeah it involves engaging with regulators because that's the future of crypto it's it's crypto 10 years from now this kind of won't exist because there'll be no need to have a dedicated, like bespoke description of what crypto is.

It will be just another asset class in the same way. OK, you get specialist bonds or equities or structured products, guys, but they're operating within a financial ecosystem, financial services more generally. And that's where crypto will end up. Now this isn't a, does it go this way or that way? Does it go unregulated? It's only one way. There's only one way from here on it. But back when Bittrex was founded, 2013, 14, we were basically the only people pushing for this, right? So our founding pillars are security, innovation, and regulation. Now, I've never heard anyone say, oh, I don't want security or innovation, right?

What I really want is an unsecure exchange or an un-innovative. No one ever says that. But there were a lot of people that said, I want it to be unregulated. And in fact, our founders got literal death threats from people saying, how dare you push for regulation of this stuff? It's anathema. When we take over the world, you're going to be up against the wall. Literally horrifying stuff because they dared to say that crypto should be properly regulated. Well, okay. So a decade later, we won. We were right. Their vision was right. And the whole world now needs to get on board and start walking the walk rather than just talking the talk. You just mentioned how we've gotten to this place because of all the scams and fraud and collapses and contagion that we've seen of late.

How much has that impacted your business? I guess, A, I know it's obviously been rocky and it has led to the regulation that we just described or the regulatory environment. And then B, do you think it's over? Well, look, so on the scandals thing, I see it as a necessary function. My favorite analogy here is, it's like if you went on the internet in the early days in the mid 90s you went on the internet was full of bugs full of scams and bright neon lights it was an absolute catastrophe of a place right but also in there were things that became google and amazon and facebook and like i've heard of those, they still exist. So the trick is, how do you ensure that you're one of those ones that exists

and continues and clear out the crap that sits underneath it and actually create a, I'm not going to say that the internet's a wonderful place full of only good actors today, that's for sure, but it's a damn sight better than it was in the mid-90s. So I think we did need to go through a process of clearing out and probably still do need to go through a process of clearing out. Is it over now?

Well, who can tell? There's lots of things going on, right? So the FTX scandal seems actually not to really be about crypto at all. It seems mostly just to be straight up or the allegations are straight up fraud right it could have been he could have been selling you know screws or hammers or like whatever it is um doing the same thing so it's kind of it affects the industry because people see crypto and scandal and put them together but it wasn't really about crypto at all or at least it didn't seem to have been. On the other hand, I guess if you're looking at

scandals like algorithmic stable coins, that is much more an actual crypto problem. And the industry and the sector and the technology guys need to figure out how they work and do they work and how to make them stable, stable coins. So is it over? Like, I don't know. I think it's getting a lot better. I think the push to regulation is a good thing. But I think it needs to be a push to quality as well. And I think there is a flight to quality as well.

And what we're seeing is the big institutions, especially because they're the ones best at managing risk. They were so price focused over 2021, 22. They were just chasing the bargains. There does seem to be an extent to which they simply weren't doing the due diligence necessary to actually ensure that quality. To answer your question about what the impact we've seen is, nobody seems to be slamming on the brakes here, but it is clear that people have taken their foot off the gas and are now asking the questions that frankly, they should have been asking all along. And we like that, right? We say, okay, you say you're regulated, but how are you regulated? Where are you regulated? How does that impact

your day-to-day? And most importantly, how does that make people and markets and participants safer? That's what it's all about. Now, those are the questions that we are now being asked in a really searching and robust way by those big banks, by those financial institutions. And we love that because we've got answers to those questions. But yeah, it takes time and they've got to go through their risk committees and their processes. And so there's obviously been a drop off in volume trading and people aren't quite putting

the triggers on the plans that they're still setting up. So that the end goal is a future that looks much more like what we want it to be. And we are getting there really, really fast. There's probably still some pain to go and the the real world economics and financial situation is is playing into that right so silver gates being the obvious example there the the fall in u.s bonds yields are sort of rising u.s bond yields and the full new spawn prices has effectively or at least according to some analyses, led to the surrogate situation. So you can't just see crypto as a self-contained ecosystem. It interacts with the real world.

And as it becomes bigger and more important, those interactions are going to become multilayered and more complex. So look, if I could predict what the future hold on crypto, I barely predict what happens 30 minutes from now. I know. Yeah, I agree. But I think we're trending. It might not seem like it, but I think we're trending long term in the right direction. You mentioned Silvergate, which is hard not to talk about at this point because they were

the first to effectively bank the crypto industry in the United States, the only one willing to take a gamble on these small companies like Coinbase and Paxos and Gemini, certainly in 2014, 15, 16. So on the one hand, it's very sad to see them go, but there's another bigger problem, which is, does anyone need to step in and pick up that slack? We've recently seen reports that Crypto.com can't find anyone to bank them effectively in North America, that they only have an EU banking partner. Are you concerned at all right now that what is happening with Silvergate and in the industry could affect the relationships with banks and effectively cut off the on and off ramps for exchanges and then, of course, their customers?

Well, I think you've got to be concerned about that possibility. You can stick your head in the sand, but it's happening and it is a problem. How much of a problem remains to be seen. And yeah, I agree with you. It's really sad. And Silvergate did an awful lot for this sector at a really early stage. And historically, Bittrex and Bittrex Global are banked there. Now we don't have any customer assets there now.

And we kind of moved on. And again, you get to a situation where the big winners are the rest of the world, because if people are having trouble, I hadn't seen the report you mentioned, but but if big exchanges are having trouble getting US banks, well, then you go find yourself a bank outside the US. Right. We had regulatory arbitrage. Now we have bank arbitrage, right? Just go find the place where you're treated best. But arbitrage in a good way, rather than in a regulatory sphere, we mean arbitrage, meaning a race to the bottom. Here, we just mean a race to opportunity.

And look, who knows? If I were an innovative CEO of a bank in the US, might I see this as an opportunity to capture some of that business and start offering new services? Like maybe, but that would be quite a bold decision in the current environment in the US. And so again, it all comes full circle, which is how much appetite is there for this stuff? And ultimately, is the legal regime allowing people to make those decisions? And again, the big winners are if you are a number of European banks that offer USD functionality or rest of world banks that offer USD on and off ramps, you must be licking your lips and

being like, this is great. Yeah, absolutely. And interesting, I mean, it's hard not to continue talking about regulation, but I think it's always important to point out that just because a regulator has a stance on something or has an opinion, much like Gary Gensler saying that everything's a security, still has to be codified in law and supported by the legal system. And in the past few weeks, we've seen some serious pushback from the US legal system against the SEC and regulators, the Voyager case being one example. Grayscale, the judges

questioning the SEC's stance. So I think as much as there is this justified fear about regulation in the United States, the game's not over. I completely agree the game's not over. And ultimately, the US is, in all sectors, sectors, not in crypto across the board is held up as, um, in many ways, the epitome of the rule of law. And if you believe in that, and if you believe that you're right, then yeah, you go through the process and, um, and ultimately you will win. Who really wins though? Well, as I say, I spent over a decade as a lawyer and i was all in favor of paying paying extortionate amounts of legal fees right because that was that was my career now i have to pay those fees i'm less excited about that prospect and look just look at the the legal fees

coming out of some of the insolvencies like yeah the rule of law is great and i'm a fundamental believer that ultimately if you're right you will win and the u.s is a very legalistic system and it has a lot of levels of ensuring that that the end game the final result will be right but how much money is left when you get to the final result is how much money is left and who's up for final result? How much money is left? And who's up for the fight? I think there's a lot of people, a lot of very good, very clever, very innovative entrepreneurial people who will just sit there and be like, Nah, I'll just go Goldman Sachs. I'll just go to JP Morgan. They're banks.

They're traditional. It's fine. And the ultimate people that lose out is just society. It's just society, right? They're the only people that lose out. And this, it goes to the very core of what can crypto offer, which is people that have been failed by traditional finance that don't have access to the products and services that they could be

getting because they're not not because they're dodgy but because the the risk profile of these big institutions refuses to acknowledge that they can be provided with services that's what crypto offers and those are exactly the people that are least well served by this reliance on the court system or challenges and whatever the whatever the correct legal route is all of that could be wiped away by actually having legislation that says this is what you can do this is how you can do it go away and do that and and the lack of certainty is i I would much rather bad but clear regulations than opaque, who knows, come and see me in three years after having spent $150 million. And then we'll tell you if you were right. That's no way to run a business. I've heard that quite a few times. Negative clarity is better than no clarity, which is a sad, sad sort of state of affairs. I mean, talk about these insolvencies.

I think it was just reported that FTX spent $38 million in a month in their chapter 11 bankruptcy. And we know that this is going to take years and years and years to resolve. You're talking about billions of dollars and that's not FTX's money. That's literally the creditors money that's being spent on those fees. I mean, what an insane process. I don't know which law firm has got that mandate but um yeah that's what that's why you become an insolvency lawyer right yeah lawyer and advisor or the new ceo apparently um but that that's neither here nor there and one of the one of

the big sort of statements from certainly giggensler as a result of the FTX insolvency, the CeFi collapses, has been that exchanges should not be viewed as trusted custodians. There should be a wall between custody and exchanges. Running an exchange, how do you fight that battle? And whether it's right or wrong, I mean, I don't know your opinion, but how do you actually approach that? So to me, the most important thing is clarity. Tell your customers what it is they're buying. Where I think the SEC is at its strongest and most persuasive in all of these, and they're very well written, very well thought out complaints, but where they're at their strongest is where they say they were doing X, Y, and Z

or X, Y, and Z, given that we can turn them over. That is fine. We accept that. We're global here. Good to know. So they said they were doing A, B, and C, but they never told their customers that.

Or their terms of service said they were doing something else. And that's unarguable right because the lack of clarity to your customers is basically unforgivable you need to the enforcement needs to allow for people or the regulatory regime needs to allow for people to offer a variety of services but they need to be transparent about what those services are so if we take it back to my apple example right it's it is one thing for me to say well there's three different types of apple there's like really good

apples there's kind of starting to moldy apples and then there's kind of manky apples but they taste nice right and and if you have the kind of manky apples but it tastes nice here are the risks associated with that but like maybe you want to go and make bake something that requires like slightly overripe and manky apples you shouldn't be able to make that choice so long as i've given you the information that you need to make that choice and i think there that where the complaints are is that i'm just saying apples or worse, sometimes I'm just saying oranges. And then you get home and you open a bag and it's a manky apple.

I've absolutely hammered this analogy to death. Now I'm going to move on. I like it. I enjoyed it. I do too. I think it's because I can understand apples a lot more than some of the technical analysis that goes on with some of these uh these more funky crypto uh assets but um i i think where we need to get to is a stage where people need to be able to make informed choices

and if you provide them the information that they need to make those informed choices then within a certain scope and ruling out sort of scams and genuine bad actors on either side, like optionality and choice is a good thing. So I think where the SEC is at its strongest and where actually I don't think anyone really objects is when you say this was misdescribed or not described. Right, transparency and disclosures, I think everyone agrees with. I think the caveat there being, no, that it can't be like a, did you read the terms

an agreement scroll down 100 pages and click yes right that's the other problem is that yeah I also I also had to like read the disclosures to use iTunes you mean you don't read the disclosure God I I'd assumed everyone read every single yes there was a great South Park episode about that where it was like, why won't it read? And they kept showing it the iPad to read it. But I mean, nobody reads the terms and services. So I guess you would with a bank, but it would have to be, point being, if that was buried 17 pages deep in legalese disclosures,

you're also not going to see that loan that they gave out that you wouldn't have agreed with. Sure, but there's a balance to be struck here, right? So again, taking my legal background in a totally different context, I was talking to a company that was advising on a bond issue. And bond prospectuses in the EU are very heavily regulated and they have to follow a very strict formula and they're put together in a certain way or set out in the prospectus regulation and what you end up with is a book like that thick that tells you um these are bonds and bonds are risky for the following 426 reasons and you think well you can read that kind of stuff and and actually there is an element to which okay our terms of service for pitchers global are what 40 pages

if you don't know what you're getting into one of the great advantages of crypto is that unlike traditional finance you actually can find out everything you need to find out and yes it's obviously like the running joke no one reads apple's terms of service for itunes okay fine but that doesn't mean you shouldn't read But that doesn't mean you shouldn't read anything. That doesn't mean you shouldn't inform yourself of anything. And I think people can take that argument too far and go too far the other way. And so to bring it back to the question you asked about custody, it's one thing to say we are a custodian and we treat your assets in accordance with custody rules, A, B, C, D, and E, and it turns out that's not true,

that's obviously fraudulent, misrepresentation, throw the book at them. But if you have a set of terms of service that says, we are not custodians, we do this, this, and this with your assets, this is the status that you are going to be as a customer. That's what we should be doing. That's what we should be disclosing to people. And it's not a legitimate argument to say, oh, well, I shouldn't have had to read those pages to explain that. Sure. Yeah.

Because how else are you supposed to get it over to someone? Yeah. I mean, being your own bank kind of requires understanding, at least the very basics of what you're doing. And I loved your sort of description of the ethos of crypto and the reason that it's here in the very first place, which is for those people who do not have access to banks who are underbanked or unbanked entirely. And frankly, they're likely to use an exchange as a bank. I mean, you're going back to CZ once again. He said, listen, I think, I don't remember the percentages, like a huge swath of our customers are people with tiny balances that never trade that are just using

Binance to transact. I would hope that they wouldn't have to use Binance to transact, but that is the reality. i i don't know whether he hopes that or not but um we said we don't make money on them so it's a risk and not a not a not a i don't think he thought it was a great thing for him as a business i i'm sure that's right but i think it represents um a failure a design failure of traditional finance, right? Because certainly from a UK perspective, an EU perspective, traditional finance explicitly says that if you are not a high net worth individual or a big corporate or a sophisticated investor, you may not have access to the whole range of financial services and products that are available to those people, right?

Sorry, you're too stupid or poor to engage here. Go away. And I think there's a lot of people, even when we think about underbanked or unbanked people, we tend not to think about Europeans, right? Because we're generally privileged and generally have access to a wide range of financial services. But even within Europe,

there's a growing reticence that the best investments, the best opportunities, the best products are not available to ordinary people like you and me, and people are frustrated with that. So if they're frustrated about that sitting in London, how much more frustrated with that must they be in an area of the world where they simply don't have access to anything? You want to start a business? You want to get a mortgage for your house?

You want to provide for your family? Sorry, you're too poor or you're too stupid. Go away. Or there's literally just not even a lender in your country. Or there's not a lender, but you've got a mobile. You've got a mobile and you've got a connection to the whole world. That's the opportunity of crypto and and i think you know those jurisdictions that are taking crypto seriously realize that and and want to want to be part of that want to mitigate the harm that

traditional finance sector uh has caused by taking that approach um And yeah, so it doesn't surprise me the numbers that are being cited on these things, because crypto presents an opportunity for people where other opportunities don't exist. Are there other opportunities in crypto that excites you at the moment? Anything new that you see is coming? Anything that you're just really jazzed to see happening? There's been so much negativity that I think people have forgotten even about what you just described, much less all the other things being built on this technology. I think there is a lot of innovation going on out there. I can think of a number of examples, but

I think a couple of things I would highlight. Tokenization of real world assets is obviously the hot topic conversation. Stablecoins is another really big one. So a quick show for Bitrix Global has just launched zero fee transactions with USTC and EuroC. uscc and euro c and that's proven immediately incredibly popular because if you're doing any uscc euro c pairs trading on betrix global you'll pay no fees at all for retail clients so that allows you to basically dip your toe or jump straight in to the pool of well what can stable coins actually provide for me in a way that the cash can't uh or that bank transfers can't allow me to get into crypto that's a really exciting and innovative project and i think stable coins still have a long way to go um to to really develop their potential uh and

there's some really interesting stuff being done there again were they impacted by the the Ferrari and the scandals over algorithmic stablecoins? Sure. But again, don't throw the baby out with the bathwater. See what works, see what's good. And the fact is, innovation does require taking a few wrong turns. And it does require figuring some stuff out and being coming back to it and doing it a different way a few years later. So the USCC and EuroC project that we're working on is really exciting, not just because zero fee. I mean, everyone likes zero fees, but because of the way it leads to future possibilities for innovation. Talk about tokenizing real world assets. You guys have been one of the leaders,

if I recall correctly, in allowing tokenized stock trading, correct? Yeah, we were one of the first to do it. And at the moment, that project is on pause because we want to engage with some new ways of thinking about it. And this is all part of the same process, which is constant innovation and constant development to ensure that our customers are protected at all times, but actually have access to the products that they need. So that program focused on tokenized stocks and basically U.S. equities that have been tokenized. We're now in conversation, really interesting conversations every day with people talking about real estate, funds, insurance contracts. We've got a little task force here called Tokenize Everything.

And the possibilities there actually then stray into NFT territory, which is something we don't do as a platform right now. But as a lawyer lawyer i'm i think nfts are incredibly exciting not for sort of pictures of apes which is obviously funny for the real world use cases yes but for the world when i go and when i go and register my real estate i can either go to the uk land registry and sell to my own this bit of land and trust that they will accurately record that and that my claim will be protected. And I do trust the UK land registry. They're probably not corrupt and they're probably not going to mess up or lose my records.

But if I could do that on a blockchain and I could do that in an independently verifiable way, that's going to give me a level of confidence that's much higher, even in the UK. But okay, the UK is pretty trustworthy. If I'm sitting in a jurisdiction where the government cannot be so trusted, or where there simply isn't the infrastructure, the ecosystem to make that claim, that's going to open up a whole world of opportunities for me and allow me to really structure my life in a much more robust way. You have a tokenize everything department.

Do you believe that we will eventually tokenize everything? I mean, that grand vision is wonderful, but do you think that we actually get there? Because I love the idea, but then I think about all the banks and payment companies that are disintermediated or destroyed, unless they, of course, become somehow involved in the business

and disrupt themselves. But I just can't see Goldman Sachs and Visa and MasterCard all disappearing overnight because we can transact. I can send you something directly without them in the middle. No, I don't think they will disappear overnight. I think you're right. What will happen is they will get involved. and that's where you get the real exciting innovation right it's easy in the crypto community to characterize big actors and goldman sachs is always the target right as slow and sluggish and ponderous and only interested in their own position. And that's simply not true. Like historically, those big players have been the biggest drivers of innovation. And are they kind of stuck in a bit of a rut at the moment?

Are they a bit slow to adapt at the moment? Yeah, sure. But actually, the big change will happen when they stop biting it and we stop biting them and we start talking about partnering and working together. And actually we are beginning to see that. And the big talking point of this bear market is institutional interest in crypto. Every big bank now has a substantive crypto desk, not just for trading, but for partnerships

as well. Right? And so it's a nice story. Everyone likes a goodie and a baddie and likes a war against the big bag giant, Goldman Sachs. But actually, they're not the big bag giant. They're the people you need to recruit in order to actually- You can't tokenize everything without them. Without them adopting it, you just can't. And show them a way that it can be done and it can make them money. And I guarantee you, they won't stand in the way of that. They'll be peddled to the metal

to exploit that opportunity because that's what they do. They didn't become Goldman Sachs by turning down financial opportunities. Exploit is the perfect word uh right it's the kind of uh you uh you get what you wish for you want institutional adoption you get institutional adoption of the crypto space and you get this asset class behaving like an institutionally adopted asset class and they're going to come and they're going to try and beat us and they're going to be you know more innovative they're going to be more aggressive they're going to be more innovative. They're going to be more aggressive. They're going to be pushing the boundaries much harder with the weight

that that makes the industry better. That makes the, that makes the opportunities for individuals better. And yeah, it's going to be painful along the way because kind of war is painful, but it's not crypto versus Goldman Sachs or crypto versus institutions. It's a race to who can do crypto better. You're giving me some hope. Good. I think that the future is bright, even though we're in a dark spot here.

Sunshine's and rainbows, Scott. Sunshine's and rainbows. All the time. Unicorns, puppies, ice cream, all of our favorite things. Well, I'm sure that your job has remained extremely challenging through all of this, but I do think it's important that people zoom out and realize that every market has its narratives, but the cycles are somewhat the same. It's just a matter of time. We will go up again. There will be another bull market.

It's inevitable. I think that's right. And I think the reason I fundamentally believe that is because I fundamentally believe in blockchain. And I think the technology is in a world where everything is described as disruptive. I stubbed my toe this morning in a disruptive way. But blockchain is genuinely disruptive. It's new. it's important technology, and it's not going anywhere. So as we as a society, I don't mean a crypto society, I mean, as a human society, begin to really understand the opportunities there and work out how to monetize those opportunities and create opportunities to use that technology,

then yeah, the future is still bright. But that does not mean that the dark clouds above us right now aren't real. They are. People are hurting. In particular, people have lost money in these scandals. And it's very little for them to say, oh, well, don't worry, the future's bright. They're like, sure. When the money's gone, it's gone. Right, yeah. So those are very real pains that people are suffering through. But do I think ultimately

the blockchain technology is going to be part of the financial future? Absolutely. I hope we are both right. So where can everybody follow you? And of course, check out Bittrex Global after this conversation. You can follow me on Twitter. I'm at Oliver Lynch or LinkedIn, also at Oliver Lynch. Or you can visit global.bittrex.com.

Awesome. Well, thank you, as always. You've been a very popular guest of late. I'm glad that we finally got to have a one-on-one conversation as opposed to on a panel. So I'm telling you right now, we're going to have to have you back one-on-one again, maybe, you know, four to six months down the road and see just how bad it's gotten. Anytime. It's a real pleasure to be on your podcast. It always is. And thank you for

taking the time and having me on thank you