- 14 hours ago
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00:00Let's start with the recent sell-up. What's that? Is that cryptocurrencies losing momentum?
00:06No, no. It's just a quick pit stop at the gas station before we go on the long road trip.
00:11So healthy correction. Where do cryptocurrencies go from here?
00:14Well, the demand is still incredibly strong. We've got a lot of things to look forward to.
00:19The Clarity Act is likely going to get passed, and that's going to bring a lot of institutional players in.
00:24User growth is strong. Institutional demand for Bitcoin is very strong.
00:28A lot of innovation, a lot of new projects.
00:31VC is a little stagnant during these time periods, but it'll pick up in the last part of the quarter and the early next quarter.
00:36So I think probably middle of next year, $250,000 Bitcoin.
00:40What's the risk out there, right?
00:42Some say that the optimism is partly driven by easing rate cycle, but who knows where that's going?
00:50How far, how fast might the crypto world participants, investors be disappointed?
00:55Yeah. The challenge for cryptocurrencies is it has to decide what kind of asset it wants to be.
01:00Does it want to be a tech stock or does it want to be like a contrarian, counter-cyclical thing when the government's not doing well?
01:07And some days it wakes up and it says, hey, when the dollar's weak, crypto's strong.
01:10And some other days it wakes up and it says it'll follow the dollar or follow tech stocks.
01:14So we'll figure that out this cycle as the institutions come in and they figure out how they want to trade it and what bets they want to have.
01:20But there's just simply put too many people and too much money coming into space relative to the supply.
01:25So I think we're still headed towards a bull market.
01:28Just stuff happens like the tariffs and the fight over interest rates and these things.
01:32And we're not immune to the macro.
01:34You know, we live within that.
01:35And when there's geopolitics or bigger economic concerns, people get a bit more conservative and they wait to deploy capital.
01:43In your opinion, what's the tightest correlation to cryptocurrencies?
01:48Would it be the dollar?
01:49Would it be gold?
01:51Would it be what would that be?
01:53During the bear market the last few years, it was tech stocks.
01:57And then it followed gold for a little bit.
01:59And hopefully it's large enough to basically be its own asset class.
02:03I want to get you to look into the crystal ball in terms of pricing.
02:07Where do you think Bitcoin is going and link to that where Ethereum is headed?
02:12Yeah.
02:13So I think all the alts are going to enjoy a nice spike.
02:16But typically there's a lag.
02:17So Bitcoin goes up, it stalls and then the alts come up and then the market goes down.
02:21It reaches a new plateau.
02:23We sit there for a few years and then we go up.
02:25Those cycles were retail driven and they were every four years.
02:28But now that we have all this institutional involvement, we have things like the Clarity Act coming,
02:32you're going to have probably another half billion to a billion users entering the space as the Magnificent Seven come in.
02:37And they integrate crypto into their platforms.
02:40We're already starting to see the banks come in because of the Genius Act.
02:42And these create disruptions that are unpredictable because that's a different kind of capital than these retail cycles that we have.
02:49So in terms of price, I still firmly believe that Bitcoin is probably going to peak somewhere around $250,000 sometime next year.
02:55Sometime next year is middle of next year?
02:57Probably about middle of next year.
02:58It just depends on the macroeconomics.
03:00And Ethereum?
03:01It's hard to say.
03:02But usually you see a proportionality with those types of things.
03:06So I could see another 30 to 50 percent.
03:09But I'm the worst trader in the world.
03:11So don't take any financial advice from me.
03:13Hey, you know, you made a crypto comment on X.
03:16You said Cardano is going to break the Internet.
03:20What's the basis of that comment?
03:21We're having a lot of fun with Cardano right now.
03:23We've got the launch of Midnight.
03:25You know, we've got Ouroboros Leos coming out.
03:27And so just everything's getting better in that ecosystem.
03:29A lot of wonderful partnerships, a lot of wonderful collaborations like the one with Google Cloud.
03:35And so it's just fun to see that the community is waking up and been reinvigorated.
03:40And we've kind of survived the worst parts of crypto.
03:43And now we're on the other side of it.
03:44And we're getting very excited for the bull market.
03:45It has reignited the debate whether Cardano is sound money or not.
03:50Well, we're deflationary like Bitcoin.
03:52And I'd argue that we're in the same category as that.
03:55But then, you know, you get to this definition of what is sound money and is Bitcoin money or is it digital gold or not.
04:01But regardless, the magic of what we've been building with Cardano is the ecosystem.
04:07It's the millions of people that are there.
04:08It's the decentralization.
04:10And in fact, we've been running for eight years straight, 24 hours a day, seven days a week, never been hacked, never gone down.
04:15There's a foundational reliability there, which is why the U.S. government likes it.
04:19They tweeted about it.
04:20It's going to the reserve.
04:21And it's also why a lot of institutional people like Cardano is one of the blue chips of the industry.
04:26What I find interesting is that Cardano has often been seen or has been said to be a threat to Bitcoin's dominance.
04:35I mean, don't they have different value propositions?
04:38Yeah.
04:39And I don't view anybody as a threat to each other anymore.
04:42I mean, the big challenge for us is we kind of want.
04:44And we're like the dog as an industry that kept chasing the car and finally catches it.
04:48And it doesn't know what to do with the car.
04:50So the regulators have finally embraced us.
04:52We're talking to the Federal Reserve.
04:54We're talking to the SEC on favorable terms as an industry.
04:57And now we need to reconcile the legacy world and the DeFi world and bring them together and just have FI, next generation finance.
05:03So everybody has a role to play in that, whether you're Bitcoin or Ethereum or Cardano.
05:08It's just going to take a little bit of time to figure out how to do compliance and what privacy looks like and how global settlement is going to work.
05:14Like every securities law has to be rewritten.
05:16So you're talking about a coexistence between traditional finance and what we have right now, what you represent.
05:22I just had a conversation with Vlad Tenev of Robinhood.
05:26He talks about how cryptocurrencies will be the backbone of the financial system.
05:32Will it be?
05:33I think so.
05:34I mean, tokens are like financial stem cells.
05:36They can be heart cells and brain cells.
05:37And so they can be securities or commodities or currencies or intellectual property.
05:41And having T0 24-7 global settlement with full programmability is a really powerful thing.
05:48The only thing we're missing is selective disclosure and rational privacy.
05:51You need to have the ability to do private smart contracts to sort out the private side from the public side.
05:56And that's where the industry is at right now, solving that last mile problem.
06:00Once you have it, you can pull everything together and then you can be a super set to broker dealers and super set to custodians and all this other stuff that runs the legacy world.
06:08And at that point, there's no reason to run on the legacy system.
06:11You want to run on the crypto systems because there's far more liquidity.
06:13And when will that happen?
06:14Within the next three to five years.
06:16And the big challenge was regulation, but the regulation is getting done.
06:19You know, Clarity Act will probably be passed in October.
06:22And then it'll be about two to three years of rulemaking between the SEC and the CFTC.
06:26And then every jurisdiction, the MECA framework in Europe or Abu Dhabi's ADGM or here the Singapore Monetary Authority,
06:32will have to be interoperable with that financial set.
06:34And it's not going to just talk about tokens.
06:36It's going to talk about securities laws and taxes and custodial standards.
06:39And then we as an industry can adapt our software accordingly.
06:42And then all the securities will enter in.
06:44That's $10 trillion on the blockchain space.
06:47And then, you know, everything else is the sky's the limit.
06:49So we've basically won as an industry.
06:51There's so many issues within the space.
06:54There's cryptocurrencies, tokenization.
06:56And now the big thing is DATs, digital asset treasuries.
07:00What do you make of the inflated valuations that we're seeing?
07:02Well, Wall Street's never found something they couldn't securitize and mess with.
07:07It's just an old play, run again and again and again.
07:09And they've already overdone it, which is why the valuations of DATs are starting to decline.
07:13And what's happening with DATs is they have to go from a trade to an investment.
07:17So the first layers of DATs that were launched, they were all about, hey, let's get in and out in 90 days or 120 days and make a multiplier.
07:23But there was really no desire or connection to the underlying asset in terms of a long-term goal to be in the ecosystem.
07:30But now what's happening is they have to convert these into almost like blockchain development companies.
07:34And there they have to think about, okay, how do we create value for this ecosystem three years, five years, ten years?
07:40And you can look at it DAT as kind of an index of an entire ecosystem, not just the underlying asset, but all the things built on it, all the partnerships derived from it.
07:47So they figured out the financing mechanism.
07:50They figured out how to get liquidity.
07:51Now they have to actually figure out how to responsibly place the money.
07:54And they'll get that sorted out.
07:55And the SEC will come in at some point and say, hey, hey, calm down a little bit.
07:59They always do.
08:00And they'll figure out a way to run these that are beneficial for everybody, including the investors.
08:06How will it shake out winners, losers?
08:09Any person that's in it for the long run that bets on why the technology is here, that T0 settlement, that 24-7 liquidity, the ability to make settlement compliance, automated regulation, these types of things is going to do really well.
08:23Because those types of systems are going to be the inheritors of trillions of dollars of new assets.
08:28Any person that's coming in and trying to figure out the timing of the market and, you know, how do I get in in a month and get out next month, you tend not to do very well because the problem with crypto is it's too subject to black swan events.
08:39You have major companies collapse and major people go to jail and big regulatory events and macro factors like war in Ukraine or tariffs that come in.
08:49And they blow up a market that seems to be heading towards a bull run or they build up a market that seems to be heading towards a bear run.
08:56So I wouldn't try to time it.
08:57Instead, you leap like Warren Buffett saying markets are weighing mechanisms.
09:01You just look at the long term and say, what are the fundamental bets in 3 to 5, 10 years?
09:06Make those bets and you'll do very well.
09:08Are you setting a new coin up to Cardano and Ethereum?
09:10Are you looking at one?
09:12Well, we have Midnight coming out and that's kind of an extension of what we've done in the Cardano ecosystem.
09:16But that's a big bet on rational privacy and selective disclosure because we wanted something for Wall Street to enjoy having.
09:22We wanted something for the custodians and the exchanges and the big guys to be able to tokenize what they currently have but bring it into the cryptocurrency space and project it into Ethereum and to Cardano and Solana.
09:32So we're having a lot of fun because we get to be everybody's friend right now, whether they're the legacy people or the DeFi people.
09:38So that's going to be great.
09:39Midnight's coming towards the end of the year.
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