CD133: BITWISE BITCOIN ETF WITH HONG KIM

Transcript

WEBVTT

NOTE
Transcription provided by Podhome.fm
Created: 5/15/2024 9:53:03 PM
Duration: 6637.973
Channels: 1

1
00:00:04.160 --> 00:00:05.460
Watch Sailor carefully,

2
00:00:06.080 --> 00:00:07.930
and I've watched his messaging. And,

3
00:00:08.985 --> 00:00:13.005
it's it's fascinating to me and I think highly intelligent on his part

4
00:00:13.625 --> 00:00:14.684
that he is

5
00:00:15.465 --> 00:00:22.039
not talking about Bitcoin as a replacement to the dollar, not shitting on the dollar, not talking hyperinflation.

6
00:00:23.065 --> 00:00:26.605
I mean, I think I think he he knows all of those things are in the cards,

7
00:00:27.225 --> 00:00:31.965
but he continues to talk about this just as an investment in digital property

8
00:00:32.730 --> 00:00:36.590
and comparing it to Apple and comparing it to Manhattan Real Estate,

9
00:00:36.970 --> 00:00:50.160
and he's just selling it as the best investment. And I I think that's really, really smart on his part. And the reason it's so smart is there's no point in pissing off the US government and all these idiots in DC

10
00:00:50.780 --> 00:00:53.760
who, if they realize we're going after their dollar,

11
00:00:54.220 --> 00:01:04.325
they're much more likely to do the Elizabeth Warren, come after our on and off ramps, and tax us and, I guess, disclose our, you know, our addresses and all that other shit. And so his

12
00:01:04.705 --> 00:01:06.805
you know, I I really respect his approach.

13
00:01:07.530 --> 00:01:16.670
And, I mean, he even asked me in Madura, you know, to kinda tone down the hyperinflation stuff, and I respect that. I mean, I get it. It's like, why get the other side all pissed off,

14
00:01:17.185 --> 00:01:18.085
you know, about,

15
00:01:18.545 --> 00:01:26.165
you know, the fact that this thing's gonna crush the dollar, which it will. But why get them pissed off about that? Why not just make this the best digital property?

16
00:01:26.780 --> 00:01:27.600
You know? And,

17
00:01:28.220 --> 00:01:29.280
you know, the dollar

18
00:01:29.580 --> 00:01:31.660
the dollar's gonna die whether you know, what

19
00:01:32.460 --> 00:01:36.755
irrespective of what Bitcoin and gold do, the dollar is gonna die its own death

20
00:01:37.134 --> 00:01:38.274
based on the misbehavior

21
00:01:38.575 --> 00:01:40.034
of the politicians in DC.

22
00:01:40.735 --> 00:01:44.994
You know? And and, I mean, I I tell people we're looking at investing my fund. I said the only way

23
00:01:45.350 --> 00:01:49.049
my fund doesn't work is if Washington DC gets incredibly responsible.

24
00:01:49.510 --> 00:01:55.284
And, of course, they always laugh. You know? They're like, well, I'm not too worried about that possibility, but it is a possibility.

25
00:02:27.754 --> 00:02:34.810
Happy Bitcoin Wednesday, freaks. It's your host, Odell, here for another Citadel dispatch, the interactive

26
00:02:35.270 --> 00:02:37.290
live show focused on actionable

27
00:02:38.035 --> 00:02:40.215
Bitcoin and Freedom Tech discussion.

28
00:02:41.635 --> 00:02:44.694
That intro clip, was prolific gold investor

29
00:02:44.995 --> 00:02:46.455
turned rider by Bitcoiner

30
00:02:47.150 --> 00:02:47.890
Larry Lapard

31
00:02:48.590 --> 00:02:49.970
on what Bitcoin did,

32
00:02:51.790 --> 00:02:52.750
talking about,

33
00:02:53.150 --> 00:02:55.905
how the dollar is fucked, but we shouldn't talk about it.

34
00:02:57.265 --> 00:03:03.845
Freaks, I have a great, great show lined up today. In person rip. The in person rips are always the best rips.

35
00:03:05.150 --> 00:03:06.690
Someone who I've gotten to know,

36
00:03:08.110 --> 00:03:10.690
through the Internet, through various calls and,

37
00:03:11.470 --> 00:03:13.870
interactions, but finally got to meet in person,

38
00:03:14.584 --> 00:03:20.924
just really moments before this rip. But we're live here from Nashville at Bitcoin Park, and I have Hong Kim with me,

39
00:03:21.465 --> 00:03:23.805
cofounder and CTO of Bitwise,

40
00:03:24.540 --> 00:03:28.160
most known for their recent Bitcoin ETF. How's it going, Hong?

41
00:03:28.780 --> 00:03:29.599
Going great.

42
00:03:30.220 --> 00:03:35.045
Super excited to be here. This studio and space is incredible. Yeah.

43
00:03:35.825 --> 00:03:38.004
It's a little bit ridiculous. Right? Yeah. Yeah.

44
00:03:38.784 --> 00:03:39.284
But,

45
00:03:40.545 --> 00:03:46.010
yeah, very excited to be here. Big fan of the show. And freaks, he's he's not wearing a suit,

46
00:03:46.790 --> 00:03:49.690
for what it's worth. He's wearing a Bitwise branded

47
00:03:50.230 --> 00:03:52.810
sweatshirt without a hood, so not a hoodie either.

48
00:03:53.595 --> 00:03:54.095
It's,

49
00:03:54.955 --> 00:04:00.175
yeah. I I don't really There's there's no video on this rip, so I felt like I should paint the picture for them.

50
00:04:00.540 --> 00:04:03.200
Mhmm. And it's a little bit unbelievable to me that,

51
00:04:04.380 --> 00:04:05.840
on dispatch, I have

52
00:04:06.220 --> 00:04:06.720
a

53
00:04:07.100 --> 00:04:09.680
cofounder of a company that has a Bitcoin ETF.

54
00:04:10.715 --> 00:04:23.170
Live in person is, kind of a weird timeline for me. I I kind of didn't think we're gonna have Bitcoin ETFs after, like, the Winklevoss failed, like, 10 years ago. Yeah. Or, like, 11 years ago, I just assumed that it's just not gonna happen

55
00:04:23.550 --> 00:04:31.655
for maybe another decade or so. So it's kind of still a little unbelievable we have ETFs now. It was unbelievable for me as well. We worked on it for 6 years.

56
00:04:31.955 --> 00:04:32.775
So crazy.

57
00:04:34.115 --> 00:04:36.215
We first filed in 2019,

58
00:04:36.515 --> 00:04:37.655
I think. And then,

59
00:04:38.680 --> 00:04:43.660
yeah, every 2 or so years, we we tried again. And it was I mean, every time

60
00:04:45.160 --> 00:04:51.425
and we thought and the whole industry thought that we were just like a year or 2 away. So every mo every year it was like a year or 2 away.

61
00:04:51.805 --> 00:04:59.139
And also, like, there's administration changes, like the chairperson changed. So like all this change that kind of made it really hard to,

62
00:05:00.400 --> 00:05:10.565
understand what's happening or not happening. Should we spend time in here? Should we not? And we just ended up being stringed along for 6 years. And ultimately everything that we did didn't really even matter that much. It was ultimately a lawsuit.

63
00:05:11.539 --> 00:05:12.039
But,

64
00:05:12.500 --> 00:05:13.000
yeah,

65
00:05:13.860 --> 00:05:14.360
sometimes

66
00:05:14.819 --> 00:05:23.015
I find it even hard to believe that we're finally at a moment that we do have an ETF. And to your comment about just, like, you being surprised about, me being here.

67
00:05:24.515 --> 00:05:26.455
Yeah. I mean, I I I understand

68
00:05:26.835 --> 00:05:27.655
that, like,

69
00:05:28.380 --> 00:05:32.240
a TradFi product might not feel like it can ever

70
00:05:32.620 --> 00:05:37.840
truly encapsulate the Bitcoin ethos. And I recognize a lot of elements there, but we also try our best.

71
00:05:38.515 --> 00:05:39.015
And,

72
00:05:40.355 --> 00:05:43.815
yeah, there's like, I'm not a person that wears like,

73
00:05:44.435 --> 00:05:54.425
you know, I have a beard, long hair. I don't wear suit. Like, I think there's a reason they don't send me to Wall Street events. Right. But, but you're on Dispatch. Yeah. I'm on Dispatch. Like, I,

74
00:05:55.865 --> 00:05:57.565
like, last night, I was at bit devs,

75
00:05:58.104 --> 00:06:19.105
with National Crew. What did you think of the bit devs? It was incredible. Yeah. Yeah. Yeah. It was really good. I mean, there's a lot of topics to talk about. Like, Nostradov v 2 was a big topic, like Bolt 12. Have you ever been to a New York bit devs? I haven't. The New York bit devs is the creme de la creme. Yeah. Yeah. I I grew up on New York Bitdevs, and Jay runs the New York Bitdevs.

76
00:06:19.485 --> 00:06:22.705
Yeah. So when we launched the park, we waited, like,

77
00:06:23.200 --> 00:06:23.860
7 months

78
00:06:24.400 --> 00:06:27.860
before we launched the BitDevs here because I hold it in such high esteem

79
00:06:28.400 --> 00:06:32.835
that it was important that we at least attempted to do it as best as we possibly could.

80
00:06:34.194 --> 00:06:38.455
But Steve Steve Myers and and Matthew who run it,

81
00:06:38.995 --> 00:06:39.495
NP,

82
00:06:40.540 --> 00:06:50.045
IP wasn't there last night, but they do a really great job, and it's pretty cool to have a bid devs in house. Yeah. They did a great job. But if you're ever in New York, you should try and make a New York bid devs because

83
00:06:51.965 --> 00:06:53.585
Jay refuses to

84
00:06:54.285 --> 00:06:58.170
move to Nashville. So you have to go to New York if you want a proper Jay bid devs.

85
00:06:58.730 --> 00:07:00.510
In the comments, I see ASDF.

86
00:07:00.810 --> 00:07:03.050
This is in person, but no video. Yeah. I actually

87
00:07:03.930 --> 00:07:07.550
ironically enough, I like doing the in person rips with no video

88
00:07:10.205 --> 00:07:13.905
because it just I feel more comfortable with having the person here.

89
00:07:15.060 --> 00:07:16.260
And then if you

90
00:07:16.900 --> 00:07:21.000
I, like, I kind of compensate for the remote episodes by giving you video.

91
00:07:21.300 --> 00:07:22.760
So it's like you either get

92
00:07:23.254 --> 00:07:25.514
the intimacy of an in person rep

93
00:07:25.895 --> 00:07:30.455
without video or you have the lack of intimacy of the remote rep, but then you have video. So,

94
00:07:31.560 --> 00:07:37.580
that's a little bit of of the thought process of the context of the of the no video. But me and me and Hong are

95
00:07:37.880 --> 00:07:40.565
we're chilling here at Bitcoin Park, and you you're gonna have to trust

96
00:07:42.645 --> 00:07:44.185
us on that one. I,

97
00:07:44.805 --> 00:07:46.805
so where to start? I wanna start with,

98
00:07:48.290 --> 00:07:50.470
the string of Bitcoin ETFs,

99
00:07:51.170 --> 00:07:52.150
not being approved.

100
00:07:52.530 --> 00:07:56.405
I I when we first started chatting, I think it was, like, November

101
00:07:56.945 --> 00:08:04.485
of last year. Yeah. So it was, like, 3 months before the Bitcoin ETF, and it was because you were really interested in

102
00:08:04.990 --> 00:08:10.930
in supporting open source contributors. And Yes. It was actually quite refreshing because it wasn't us pitching

103
00:08:11.870 --> 00:08:12.370
like,

104
00:08:12.675 --> 00:08:23.440
to be frank, Freaks, like, I pitched every Bitcoin ETF to support open source contributors. I did not pitch Bitwise. Like, Bitwise came to us. Hong specifically came to us and was like, we wanna support open source contributors.

105
00:08:24.620 --> 00:08:25.979
We think this is how,

106
00:08:26.780 --> 00:08:32.235
would be a great way to have it set up. But, anyway, before we get to the supporting open source contributors part,

107
00:08:32.615 --> 00:08:33.995
I just want to just

108
00:08:35.815 --> 00:08:39.210
crystallize here that in November when we were talking about it,

109
00:08:39.770 --> 00:08:46.670
I don't think we I don't I didn't think it was gonna happen still. I mean, I I was pretty sure it was, at this point, was gonna be an eventuality.

110
00:08:47.130 --> 00:08:47.870
Yeah. Yeah.

111
00:08:49.074 --> 00:08:55.574
But, like, I like, a January launch date was still very much up in the air. Totally. Totally.

112
00:08:56.355 --> 00:08:57.095
So when

113
00:08:57.449 --> 00:08:58.829
I reached out to you

114
00:08:59.370 --> 00:09:05.709
was basically the time that it really settled to us that it was happening, that the SEC was very serious. Yeah.

115
00:09:06.275 --> 00:09:07.655
Because it was after the

116
00:09:08.115 --> 00:09:10.755
the lawsuit was decided in October. Right.

117
00:09:11.795 --> 00:09:12.695
And the SEC

118
00:09:13.440 --> 00:09:22.100
really sprinted from then to January. Like it was, it was a crazy time for us because imagine us working on it for 6 years and like

119
00:09:22.705 --> 00:09:25.285
never really getting anything back from them. Yeah.

120
00:09:26.145 --> 00:09:33.110
And like, you send something over the line and, like, wait, like, 5 months to get a response is like the kind of engagement that we had, And then overnight,

121
00:09:33.650 --> 00:09:37.350
because they were sprinting on a deadline, it was a short deadline for them as well

122
00:09:38.130 --> 00:10:13.150
to go from, like, rejecting it for years to, like, approving it in 3 months. They had a lot to work to do on their end as well. Like, every disclosure thing that they're not happy about, they want, like, mining risk to be described in this way and like the environmental risks to be described in that way. And like all these disclosure documents, even just going through the hundreds of pages of each of these issuers takes time. So we were like on a clock, like, like every week they would like send us stuff and then we would send reply. And then it would like next week, they would reply back like a crazy response speed that really indicated that, like, oh, shit. Like, they would this is different, and they wouldn't be doing this if they weren't serious.

123
00:10:14.525 --> 00:10:16.705
And But you didn't know it was going to be January.

124
00:10:17.565 --> 00:10:18.705
But there was a deadline.

125
00:10:19.325 --> 00:10:21.265
The specific 19 before process,

126
00:10:22.045 --> 00:10:26.700
that's jargon for just commodity ETFs. Spot commodity ETFs go through a specific

127
00:10:27.079 --> 00:10:36.375
regulatory pipeline, and it has a 240 day kind of timeline in which they have to decide. So there was a, end date that they needed to decide by,

128
00:10:36.675 --> 00:10:43.160
and if they were going to reject, they need to come up with They didn't have they could have delayed it again in January. Right? No. No. No. No.

129
00:10:44.279 --> 00:10:56.605
The you do can delay a few times along the way and get the full timeline. The full timeline is 240 days. But then after that, you have to decide. The SEC has to decide. So they've always always Wasn't there, like, technicality there? It was, like,

130
00:10:57.865 --> 00:11:19.645
they could have delayed most of them, but they would have had to reject a couple. It was that it? Or Yeah. Yeah. So the the one that had been in the queue for the longest that dictated that timeline, I think it was Van Eck or something. But but basically Right. But they could have just fucked Van Eck, said reject VanEck and then delayed and then No. Yeah. Yeah. Yeah. Okay. So just to maybe taking a step back, like, why did the SEC get into this position? Okay. Yeah.

131
00:11:21.050 --> 00:11:25.230
It's because they've been trading Bitcoin in a specifically weird, discriminatory

132
00:11:25.610 --> 00:11:26.110
way,

133
00:11:27.050 --> 00:11:39.830
moving the goalpost many years. And, like, they just haven't been able to be consistent across administrations and across different chair people and across different, like, market regimes. Like, they felt differently before FTX or after. Like, you know, if

134
00:11:40.710 --> 00:11:53.904
the law should be applied in a consistent way. But but given the political process that is kind of surrounding all of our regulatory decisions, it has just not been consistent. And it's not my view. It is actually the the view of 3 judges,

135
00:11:54.560 --> 00:11:59.459
in DC, the 2nd appeals court that are very well respected judges took on this case.

136
00:11:59.839 --> 00:12:21.880
Ultimately, after the a decade of the industry trying, Grayscale sued, and it went to, court in a second appeals court in DC. And the judges were looking at this, and they were like, what what the fuck is is going on here? Right. And everyone thinks that there's a meme around, like, oh, BlackRock filed, and then suddenly it was all approved. Yeah. That's I I prescribed to that meme. Yeah. The reality is is something much closer to

137
00:12:22.185 --> 00:12:59.675
BlackRock has people. Obviously, their legal team is paying attention to things. And there was, there was an oral They only filed when they knew it was gonna be approved. The oral hearing happened around May or so where there you you had audio recording and you had a transcript. And if you listen to that, the judges are very much upset. Like, there's a SEC lawyers trying to defend, like, how they the futures product is okay, but the spot product is not, and, like, how they they've made all these decisions over the years and, like, trying to come up with the coherent narrative. And the judges are like, what are you saying? Yeah. You're making no sense, and and and they're visibly very upset, and it's it's a pretty unanimous opinion.

138
00:13:00.055 --> 00:13:16.460
And anyone that listened to that could have known that probably Grayscale is winning this thing even though it's unlikely. But if you didn't listen to that as soon as BlackRock filed, it was like, okay. BlackRock filed because they know they're gonna get approved. So, like, you knew by the end of BlackRock's timeline, which I think was past January, but still

139
00:13:16.774 --> 00:13:39.505
by the end of BlackRock's timeline, they were gonna get approved. BlackRock filed around, like, August or so. So it was before the final decision landed. Like, the final landed in, like, October, but, like, they filed aft well after the hearing and well after they probably internally came to the view that that the SEC is losing this thing. And if if if it's if you have that view, then it's just a decision of, like, do we wanna be involved in this thing or not? Right. And,

140
00:13:40.579 --> 00:13:49.399
better to play the game than not. Yeah. Yeah. They're in the game of making money. They're in the game of making money. And they're like, we can definitely win this game. Like, why would we not play?

141
00:13:49.745 --> 00:13:56.005
And. Yeah, I mean, to me, I guess I guess my point is this to me, as soon as BlackRock filed, I was like, okay, this thing is happening.

142
00:13:56.600 --> 00:14:04.940
Was just a matter of what the timing I was like, I was like, I'm pretending to be a savant on the timing. But I think I even had tweets out there. Well, now my Twitter is deleted, but,

143
00:14:06.045 --> 00:14:09.025
I had tweets out there that as soon as they filed, I was like, okay.

144
00:14:09.405 --> 00:14:20.920
Like, buy as much Bitcoin as you can afford because the ETF is coming and the suit's gonna pump our bags. And Yeah. Yeah. Yeah. So I I guess the reason that I I came back to to that context is is to describe,

145
00:14:22.180 --> 00:14:26.025
that ultimately, the SEC was in a really tough position. Right. Because they,

146
00:14:27.285 --> 00:14:27.785
were,

147
00:14:29.205 --> 00:14:32.185
not consistent in how they applied the laws and then ultimately

148
00:14:32.645 --> 00:14:35.050
had a really embarrassing and high profile.

149
00:14:39.850 --> 00:14:52.025
Arbitrary and a capricious way in which the SEC handled all the filings that it was an arbitrary and capricious way in which the SEC handled all the filings over the years. So they didn't really have a way of going back from that and being, like,

150
00:14:52.700 --> 00:14:55.760
doing something willy nilly again. So,

151
00:14:56.540 --> 00:15:03.615
doing a rejection on a single filer with some cute narrative is just not something they can do. So at that point, they they had to approve

152
00:15:03.995 --> 00:15:07.595
the next deadline. They couldn't do another rejection with any reason.

153
00:15:08.740 --> 00:15:47.720
That wasn't a new reason, but there were there are no good new reasons to come up with. So then they they ended up approving. And and so then that's their hand was forced. Yeah. Yeah. Yeah. Yeah. And it's so so that was what we were working with, and we kind of knew the January timeline. And and, ultimately, later on, they communicated that that was what like, the timeline that they were working with as well. And so I had a really hard time in my body, like, not thinking that we're being gaslit again. Yeah. But because we've just been beaten down for so many years. Yes. If you go through, like, being hopeful and being rejected 6 years, then It's just that you're a broken person. Yeah. Yeah. Yeah. Like, my body had a really hard time accepting that this time was different, but it really was different. And that's when we reach out to you guys. Like like, that's when, like, when I really

154
00:15:48.200 --> 00:15:58.575
like, the, there's a lot of other people in the company working on product structuring and, like, operations. They they were, like, working on all the, like, details with the SEC. But something that I was thinking about is that, like, when I finally

155
00:15:59.320 --> 00:16:06.540
it dawned on me. I was I was trying to, like, accept that this was happening. Then I was I was then I really, for the first time,

156
00:16:06.855 --> 00:16:11.755
like, thought about, like, okay, then what do we what should what do we owe

157
00:16:12.535 --> 00:16:13.834
the network, the community?

158
00:16:14.214 --> 00:16:15.095
Like, how can

159
00:16:15.889 --> 00:16:19.829
it's both a great moment and a bit of a sad moment for the community, right? Like,

160
00:16:21.010 --> 00:16:31.655
because it is a custodial product and we're going to grow another user base, another owner base of custodial products. And yes, number might go up, but there is definitely kind of a sadness and a loss.

161
00:16:32.515 --> 00:16:35.495
And then we can, we can talk about how we can make those things better,

162
00:16:35.820 --> 00:16:44.000
like, inclined redemptions and stuff like that, which which I also care a lot about. But anyways, there is kind of that element, and I was thinking a lot about, like, how can we,

163
00:16:45.115 --> 00:16:46.075
the best we can,

164
00:16:46.635 --> 00:16:48.335
make that better. And

165
00:16:48.715 --> 00:17:05.305
I don't think at that time, anyone was really thinking that Bitwise would be a major player. I mean, it was like Block Rock Fidelity, and then You guys punched way above your weight. It was like like, you know, Frankel Templeton managed a a trillion and a half billion, in in dollars. Like, Invesco manages over a trillion. Like, these are, like, the largest asset managers

166
00:17:05.685 --> 00:17:10.025
that all manage over, like, 1,000,000,000 of dollars. Yeah. And then and then there's, like, us.

167
00:17:10.565 --> 00:17:14.760
And so I don't think anyone was really thinking that we would be a serious player, but but we had big ambitions.

168
00:17:15.220 --> 00:17:21.320
And in that world, I think I we we thought a lot about, like, how can we still create the most aligned,

169
00:17:22.125 --> 00:17:22.525
and,

170
00:17:23.005 --> 00:17:25.665
product than something that gives back and and,

171
00:17:26.045 --> 00:17:33.490
has a relationship with the network and the community and and the code base and everything. And so You leaned into what you knew, which was being Bitcoiners.

172
00:17:34.029 --> 00:17:41.565
Yeah. Because that was the advantage you had over the TradFi suits that were just entering the game essentially. Right? Yes. Yes. I mean,

173
00:17:42.105 --> 00:17:42.684
the we

174
00:17:43.065 --> 00:17:55.769
the ETF is is a definitely like a mass product, and it's very horizontal product in a way. Like there is no special treatments amongst different like holders of the shares. It's a kind of a horizontal product in that way. So

175
00:17:56.534 --> 00:18:10.100
it's used it's used by, like, a self directed person that is putting in their retirement account and also by, like, an endowment or, like, a financial adviser that has 50 clients that they are, like, all allocating to, etcetera. So it's just used by everyone, and

176
00:18:11.280 --> 00:18:11.600
we

177
00:18:12.195 --> 00:18:15.015
tricky thing that we do navigate is that we we serve

178
00:18:15.635 --> 00:18:16.855
multitudes of constituents.

179
00:18:17.155 --> 00:18:26.230
And so, for example, like, if, you know, we're going to Wall Street and talking to, like, financial advisers and etcetera, etcetera Right. We don't talk about the donation that much. They don't really give a shit. Because, like, for them,

180
00:18:26.610 --> 00:18:32.375
they're not used to seeing that on an ETF. An ETF is not supposed to, like, have, like, a world view and, like, some sort

181
00:18:32.675 --> 00:18:32.915
of,

182
00:18:34.515 --> 00:18:41.410
public mission like that. So ETFs don't have donations associated to them. And and it from their perspective, like, if you have, like,

183
00:18:42.030 --> 00:18:42.530
it,

184
00:18:43.230 --> 00:19:04.919
excess excess revenue like that, why don't you just reduce the fees? Right. So so I think to them, it's, like, kind of not a feature. It's like a weird bug. So we don't just don't talk to it about them. But but there definitely is also so so I'm not here saying that, like, we're all, like, doing this out of altruism. We definitely have our self interest as well. There's competition Yeah. To me there, especially at launch. Like, I think people don't remember

185
00:19:05.554 --> 00:19:16.100
How many ETFs were at launch? Was it 9 or 10? 9 new ones. Yeah. There was there was 9 ETFs plus GBTC, which was the juggernaut in the room. High fees, but tons of assets under management already,

186
00:19:16.800 --> 00:19:18.180
came in as number 1.

187
00:19:18.800 --> 00:19:24.115
There was intense competition, and there's there's only so many ways you can differentiate yourself from the competition.

188
00:19:25.395 --> 00:19:32.535
And you guys did it in 2 key ways. I mean, and we can go further into it, but open sort contributor to open source contributors and transparency,

189
00:19:33.290 --> 00:19:42.190
I would say are like the and fees. I mean, you guys were incredibly competitive on the fees, and there was a there was almost, like, a race to 0 on that, and you guys came in, the lowest.

190
00:19:43.585 --> 00:19:44.085
But,

191
00:19:45.745 --> 00:19:46.485
I just

192
00:19:47.505 --> 00:19:49.105
I just wanna capture, like, the

193
00:19:49.970 --> 00:19:51.990
it it was just such a crazy moment,

194
00:19:52.370 --> 00:19:56.550
and, like, the freaks don't realize, like, my other show, rabbit hole recap, I do it every week.

195
00:19:57.075 --> 00:19:59.175
Haven't skipped a week in 5 and a half years.

196
00:19:59.555 --> 00:20:01.335
Right? And, like, you came in November

197
00:20:01.875 --> 00:20:05.095
with this amazing idea for funding open source contributors.

198
00:20:07.240 --> 00:20:07.980
I did,

199
00:20:09.320 --> 00:20:10.460
like, 22

200
00:20:10.920 --> 00:20:22.855
rabbit hole recaps before I could talk to people about it. Oh, yeah. And that whole period was, like, such a crazy period in my life. I mean, it was probably way crazier period in your life. But I remember, like, the day before,

201
00:20:23.440 --> 00:20:26.980
like, the SEC bungled it and just, like, released the press release,

202
00:20:27.360 --> 00:20:32.340
and then, like, Hong messaged me. He's like, you can't talk about it still. Like, we have to pretend we didn't see it.

203
00:20:33.135 --> 00:20:40.275
It's not bad. And then the next day, they're like, oh, we've we've approved them. Like, it was just the most it was the most insane fucking period.

204
00:20:40.940 --> 00:20:43.420
On the suits thing, you don't think there's an argument

205
00:20:44.220 --> 00:20:47.840
I think there's, like, a pretty compelling argument that Bitcoin is different than other ETFs.

206
00:20:48.380 --> 00:20:49.360
Yeah. And that

207
00:20:50.665 --> 00:20:51.725
that, like, if

208
00:20:52.185 --> 00:20:58.765
it's part of the security of the ETF is supporting open source contributors. I mean, I I maybe it's not for every suit,

209
00:20:59.250 --> 00:21:04.630
but I know at, like, 1031, like, we have a venture fund. We get institutional capital. Like, we have endowments.

210
00:21:06.185 --> 00:21:16.059
Like, our core we have conversations with pension funds and stuff. And, like, when we we take a portion of our management fees, actually, very similar to Bitwise at a much smaller scale,

211
00:21:16.760 --> 00:21:18.539
and contribute to open source contributors.

212
00:21:19.080 --> 00:21:21.500
And when I talk to them about it, I always say,

213
00:21:21.855 --> 00:21:23.235
like, at the end of the day,

214
00:21:23.615 --> 00:21:24.835
like, if you're investing

215
00:21:25.135 --> 00:21:31.870
100 of 1,000,000, 1,000,000,000 of dollars, you know, tens of 1,000,000,000 of dollars and holding Bitcoin with it, like, it's prudent

216
00:21:32.490 --> 00:21:40.429
to support the contributors that are maintaining the protocol that your wealth relies on. Like, it's it's almost like a it's a security thing to a degree. Right?

217
00:21:40.875 --> 00:21:50.000
Totally. I mean, that's how I feel. I mean, I I I think even the word, like, phrase donation is a little off. I I think it is very much kind of a a self investment.

218
00:21:51.020 --> 00:21:52.080
Yeah. Like if if

219
00:21:52.540 --> 00:21:53.360
if the US

220
00:21:53.740 --> 00:21:57.050
spends on a defense security budget, they don't call it a

221
00:21:57.554 --> 00:22:01.174
a donation. They don't say that we're donating to the military. We're it's like a self interested,

222
00:22:02.275 --> 00:22:14.990
investment into your own security. And I think that's a very similar mindset that I would have and how I would frame it to anyone that if I had a conversation like this to talk about. Right. But the reality is that a lot of people make allocations and use products without really having this type of conversation.

223
00:22:15.515 --> 00:22:22.075
And like, yeah, I mean, Bitwise did a good job. And I think we really punched them over weight, but we're still 5% of the market. Right. Like,

224
00:22:22.710 --> 00:22:32.365
BlackRock is at, like, 15,000,000,000 and Fidelity is at, like, 9, and then we're at, like, 2. I mean, it just GBTC is at what? GBTC is at maybe, like, 20 or something. Yeah. Yeah. Yeah.

225
00:22:33.465 --> 00:22:35.005
They're just yeah. Well

226
00:22:35.705 --> 00:22:57.040
yeah. Yeah. Yeah. Yeah. So so And you're at 2 so you're you're 4th in terms of assets under management. Right? Yes. Yes. Because Arc is in there too? Arc is in there too. Arc is, like, 2a half. We're at 2,000,000,000. And then after us, it's a cliff. So it was basically, like, there were 4 spots. You're in the top quartile. Yeah. Yeah. Yeah. Yeah. Yeah. Which is incredibly impressive. Well, it's it's quartile in terms of ranks, but in terms of assets,

227
00:22:57.340 --> 00:22:59.520
like, I think we have more inflows than

228
00:22:59.820 --> 00:23:11.530
everyone after us added together. Oh, yeah. That's crazy. Yeah. So so it really was a cliff. There really wasn't that there wasn't 5 spots. You didn't fall off the cliff. Yeah. Yeah. There was 4 spots, and we kind of, like, held on to it. Yeah. But but but,

229
00:23:12.010 --> 00:23:14.670
the way why I say that to describe that is that, like

230
00:23:15.370 --> 00:23:39.570
like, we have the lowest fee. We do all these things that we think are more Bitcoin aligned. You're the only one on the cliff that didn't fall off the cliff that supports open source contributors. Yeah. And and and yet still, like, 95% of the people don't care about that. Right. So so that's the reality. I'm I'm just describing that, like, there are suits that people, like, that that care about this stuff. I mean, even in, like, large Wall Street firms, like banks and such, there's always Bitcoiners. That's also an incredible thing about this is that, like,

231
00:23:39.975 --> 00:23:56.860
it is really a movement. So, like, there are, like, secret people that are really about the the movement in any organization almost. That's what we see when we work with institutions. It's like just because the institution isn't Bitcoin focused doesn't mean someone on their investment committee isn't Exactly. Exactly. So so so there are definitely people that do,

232
00:23:57.405 --> 00:24:01.905
love the donation aspect of those things as well, but I'm just describing that in, like, in a general sense.

233
00:24:02.365 --> 00:24:04.945
Most people aren't like the low fees the most.

234
00:24:05.650 --> 00:24:12.550
Yeah. Yeah. Yeah. Yeah. Yeah. Everyone likes low fees. I don't so, I mean, I think one of the things that we did about the fees is that we were just very,

235
00:24:16.085 --> 00:24:16.585
we

236
00:24:16.965 --> 00:24:23.785
accepted the reality earlier than others, I think Yeah. That it was going to be competitive. Like, whatever you wanted it to be was not gonna be the reality.

237
00:24:24.150 --> 00:24:30.570
Like, your hopes doesn't dictate reality. Right. The reality is that, like, 9 people are like, 9 firms of the largest are, like, launching

238
00:24:31.735 --> 00:24:36.875
commodity products. Like, they're roughly the same thing. Right. So then it just was just going to be

239
00:24:37.335 --> 00:24:38.795
a a fee competition. And

240
00:24:39.100 --> 00:24:43.840
so we just went down earlier. So we ended up at our our 20 basis points, so 0.2%.

241
00:24:44.380 --> 00:24:48.065
Fidelity and BlackRock are at 25 basis points, so so 0.25.

242
00:24:48.365 --> 00:24:53.585
Right. And then the rest And Arc did the meme number. Right? You know, it's 21. 1 bps. Yeah. Yeah. Yeah. But,

243
00:24:54.445 --> 00:24:55.505
yeah. I I think

244
00:24:56.070 --> 00:25:05.450
we ended up roughly we're not that much lower than everyone else, but because we committed to being low early because that we just we knew that that was going to end up,

245
00:25:06.005 --> 00:25:23.935
leading up to it at any point in time, people like kept adjusting fees for, like, for 3 days in a row. But in any days, if you wrote an article about who had the lowest fee, then it was us. So I think that was really helpful in, like You're always the lowest. We yeah. Yeah. Yeah. And everyone ended up being where we were, so it didn't really matter that much in the grand scheme of

246
00:25:24.655 --> 00:25:26.755
things. It's not like we'd lost a lot of revenue over that decision,

247
00:25:27.135 --> 00:25:39.920
but, we just accepted that earlier than others so that we got credit. We got a disproportionate amount of credit for being the lowest when in reality, we have similar fees. Yeah. Yeah. I mean, I liked how aggressive you guys were with it. Like, you're obviously, like, in it to

248
00:25:41.044 --> 00:25:47.465
you you were prioritizing, and you were in it to win it. And We're we're in it to win it. We're in it to like, we we weren't shy.

249
00:25:48.360 --> 00:25:54.380
We we we did a TV ad, before, like, we We were very proud of that TV ad. Yeah. Yeah. It was fine.

250
00:25:56.040 --> 00:25:58.265
Yeah. I mean, the the thing is, like,

251
00:25:59.305 --> 00:26:03.405
it was with by the way, Freaks, if you haven't seen it, it was with the most interesting man in the world,

252
00:26:04.585 --> 00:26:08.809
the Dos Equis guy. Yeah. Yeah. Yeah. And I think we we were just,

253
00:26:09.190 --> 00:26:16.815
like, leaving it out on all on out in the field. Right. And we had to. I mean, I think the record shows that, like, everything that we did combined

254
00:26:17.115 --> 00:26:18.495
ended up with us

255
00:26:19.035 --> 00:26:23.240
holding on to 5% market share. And it's a great place to be

256
00:26:24.120 --> 00:26:25.420
because now we have

257
00:26:25.880 --> 00:26:53.505
a serious enough product that we can go out and sell. Like, if we had a $100,000,000 product, then it's not like no amount of it doesn't matter. Like fees, donations Very relevant. Proof of reserves, like, how how much you spend on marketing and sales. At that point, you don't have a product that has enough liquidity Right. To anyone else to further decide. They they can't in their good conscious. It's just like a slow spiral to death. Yeah. Yeah. Yeah. But but $2,000,000,000 product is a viable product. Yeah. Like, nobody, like $2,000,000,000

258
00:26:53.885 --> 00:26:58.625
is it's sizable. Yeah. Yeah. And and that's that's great. I mean, I I think

259
00:26:59.400 --> 00:27:01.580
I I also feel proud about, like,

260
00:27:02.040 --> 00:27:02.940
the the

261
00:27:03.400 --> 00:27:07.180
then things that we can really push for with that amount of, like, seriousness.

262
00:27:07.794 --> 00:27:12.294
If we do, if we publish our addresses and do proof of reserves, like, nobody can be like,

263
00:27:12.674 --> 00:27:23.730
they're just fly by the night. They don't take seriously. It's not a real product, like, so, like, you can't like, real serious people can't do proof of reserves. Like Right. You can't say that when there's, like, a $2,000,000,000

264
00:27:24.030 --> 00:27:24.530
products,

265
00:27:25.150 --> 00:27:25.810
out there.

266
00:27:26.115 --> 00:27:42.595
And also like, you know, we if there's something that we're not happy about, like our custodian, let's say, like there were a lot when we published our addresses, people were upset about the fact that it was, like, not even a segued address and stuff. But but, like, we can we can go back and really have a serious conversation about Kobi's, like like, what the fuck, guys? Like, it really

267
00:27:42.895 --> 00:27:53.080
is, a problem that you are putting us into this position. Right. And this is, like, not okay. And and and they take us seriously because, like, again, we're a big client. So so there's some things that I really feel,

268
00:27:54.500 --> 00:28:05.995
we we've been able to, like, push in in a way that, is material because we we got like, again, of course, I would have been great if we were in BlackRock's position, but I think we have enough for it to be, like, powerful.

269
00:28:06.590 --> 00:28:10.049
And we also am excited to grow it from here. Yeah. I mean, you should be proud.

270
00:28:10.990 --> 00:28:14.745
And that's coming from the guy who says fuck the suits in all caps. Like, you should be proud.

271
00:28:15.785 --> 00:28:16.285
I,

272
00:28:17.065 --> 00:28:18.365
so let's talk about

273
00:28:20.265 --> 00:28:22.765
we'll get to Coinbase custody and

274
00:28:23.540 --> 00:28:25.080
transparency and that stuff.

275
00:28:26.180 --> 00:28:27.400
Let's talk about,

276
00:28:28.260 --> 00:28:31.835
how you how you did your your open source,

277
00:28:32.235 --> 00:28:34.255
contributions. I thought it was it's quite clever.

278
00:28:34.635 --> 00:28:39.855
It was not our idea. It was it was Hong's idea. Like, he came with this idea of

279
00:28:40.720 --> 00:28:44.500
10% of profits for 10 years, nice long term reoccurring,

280
00:28:45.520 --> 00:28:46.660
aligned commitment,

281
00:28:47.520 --> 00:28:56.135
where if they make more money, open source contributors get more money, and then split between 3 organizations. It wasn't just OpenSets. It was HRF, Brink, and OpenSets.

282
00:28:57.559 --> 00:29:04.780
And since you brought that to me, that has been essentially the model that I've tried to pitch as many because I don't want OpenSats to be.

283
00:29:05.385 --> 00:29:12.445
Yeah. Like, I have enough pressure on me. Yeah. I I I say to everyone who's who can I think OpenSats is,

284
00:29:13.100 --> 00:29:19.039
you know, one of the best nonprofits in the world? I think we have plenty of plenty of places we can improve,

285
00:29:19.820 --> 00:29:35.040
but I think we're more ethical, more transparent, more efficient than 99% of the nonprofits that operate in the world. But anyone who gives me a critique, I would love for them to launch their own. And, like, I think as the the the more people working on this problem,

286
00:29:35.580 --> 00:29:37.920
the better, because there's no easy solutions here.

287
00:29:38.455 --> 00:29:40.475
So I've actually used your model,

288
00:29:42.294 --> 00:29:46.875
in pitches since then. I mean, they haven't been quite successful. Like, it's a long grind.

289
00:29:47.289 --> 00:29:50.830
But let's talk about that model a little bit because I think it's it's quite compelling.

290
00:29:51.850 --> 00:29:52.750
Yes. So,

291
00:29:54.304 --> 00:29:55.525
as we were talking about,

292
00:29:56.145 --> 00:30:07.190
a moment ago, I think around, like, November or so Right. It was, like, a month after the court case, like, 3 3 months after BlackRock filed. I think, like, at that point, we really knew this was happening, and I was I was thinking about it. And

293
00:30:07.490 --> 00:30:08.149
and so

294
00:30:08.635 --> 00:30:16.015
once I really felt that, like, we really need to figure out a donation, to devs here, and and and I think it's it's like,

295
00:30:19.370 --> 00:30:23.310
I mean, because it there is a unique opportunity here where, like, this is,

296
00:30:24.865 --> 00:30:28.245
a custodial product, pulled Bitcoin together. We take fees.

297
00:30:28.945 --> 00:30:29.425
So,

298
00:30:30.545 --> 00:30:32.325
it's much easier for us

299
00:30:32.720 --> 00:30:43.445
to then take a portion of the season and make that donation. It's inherently monetized. Yeah. It's inherently monetized, and it's also inherently monetized in a transparent way because it's a public product. Like,

300
00:30:43.825 --> 00:30:58.789
I mean, if another business were doing it, then they would be kind of disclosing their revenue details, and that can be a little bit uncomfortable. Right. But this product is already a public product. The fees are transparent. The AUM is transparent. Because it's an ETF. It has to be. Yeah. Yeah. Yeah. So so in some ways, it's already taking,

301
00:30:59.250 --> 00:31:00.710
again, it's inherently monetized

302
00:31:01.895 --> 00:31:02.635
inherently transparent.

303
00:31:03.655 --> 00:31:05.035
And so we weren't really,

304
00:31:05.415 --> 00:31:05.915
like,

305
00:31:06.215 --> 00:31:17.310
it was a really great vehicle. And also it's really well aligned in terms of, like, let's say if it's an exchange, then your revenue is tied to trading volume, so it can be more volatile, but our revenue is just

306
00:31:17.690 --> 00:31:23.905
with along the AUM. So if this whole thing becomes more valuable, then we make more money. So it's in a way, like, it's if we tie it to a rent

307
00:31:24.465 --> 00:31:29.730
recurring model, then it can be a more sticky and kind of stabilizing force Yeah. Compared to, I think, donations

308
00:31:30.110 --> 00:31:56.225
generally are a little bit even, like, further cyclical than the market cycle because people feel even further squeezed when the market is down than just the price level. No one donates when Bitcoin price is down. Exactly. Exactly. And so we could our our our revenue would go down, but it wouldn't go down to 0. And and I think that was also an opportunity. So so so there was a lot of ways in which it was a good opportunity, and but then when I was thinking about actually implementing it, there was a fair amount of, like, questions.

309
00:31:56.525 --> 00:31:57.025
Right.

310
00:31:57.885 --> 00:32:03.720
How do we do it in a way that people don't feel threatened by TryFi firm, like, us showing up and saying,

311
00:32:04.900 --> 00:32:17.260
we're donating that Even a buyer developers. Yeah. Yeah. I mean, even though even if we have good intentions The suits are here to bribe our developers. Yeah. Yeah. Yeah. Good intentions are not enough. Like like, Bitcoin in itself has that ethos as well. It should be

312
00:32:18.040 --> 00:32:21.100
the design of the incentives or like the model itself should be,

313
00:32:21.800 --> 00:32:22.460
should embed

314
00:32:23.000 --> 00:32:24.940
as much as possible kind of a,

315
00:32:25.435 --> 00:32:28.735
clarity about what's possible and what's not. And so, like, us,

316
00:32:29.595 --> 00:32:37.100
making a donation to an individual dev and just saying that we're not pressuring them, that's just not great for people to believe. Gonna believe you. Yeah. No one's gonna believe us.

317
00:32:37.740 --> 00:32:40.640
And so it it needed to be no strings attached,

318
00:32:41.980 --> 00:32:43.920
but it also had to go through

319
00:32:44.525 --> 00:32:46.465
other entities. It couldn't be direct.

320
00:32:47.565 --> 00:32:49.665
And then when I thought about, like,

321
00:32:51.165 --> 00:32:52.925
it being 1 and 1 nonprofit

322
00:32:53.380 --> 00:33:00.440
Right. That also comes with problems. What if we become incredibly successful? I mean, we want to be incredibly successful. Then then let's say we, like, dominate the ETF market.

323
00:33:00.745 --> 00:33:06.765
Then then suddenly one organization gets, like, a disproportionate amount of the open source funding that also can create problems.

324
00:33:08.025 --> 00:33:08.925
And and

325
00:33:09.549 --> 00:33:10.049
yeah.

326
00:33:10.429 --> 00:33:11.970
So then it had to be multiple,

327
00:33:12.990 --> 00:33:18.929
and that's kind of like where that was the kind of the idea maze that I went through of thinking, and then, okay,

328
00:33:20.654 --> 00:33:24.355
like, deciding that set was a little bit of a judgment call. Right.

329
00:33:25.294 --> 00:33:26.914
I went out and talked to

330
00:33:27.410 --> 00:33:28.390
everyone that I respected,

331
00:33:28.850 --> 00:33:32.230
in the space. Like I talked to, like, Steve Lee, I talked to

332
00:33:32.770 --> 00:33:33.670
Adam Jonas

333
00:33:35.085 --> 00:33:42.785
and a few others too that were very deep in the work of it all and like what types of organizations that they felt

334
00:33:43.770 --> 00:33:45.550
were doing the best work. And

335
00:33:46.410 --> 00:33:51.870
thankfully, it was pretty a pretty easy decision. Everyone kind of coalesced to OpenSats and Brink and HRF,

336
00:33:52.955 --> 00:33:53.455
And

337
00:33:53.995 --> 00:33:56.655
those are also the 3 entities that had the kind of cleanest,

338
00:33:57.755 --> 00:33:59.295
like clear nonprofits,

339
00:34:00.380 --> 00:34:00.880
mission

340
00:34:01.740 --> 00:34:05.280
and, We made it very easy for you. Yeah, yeah, yeah. It was, it was like

341
00:34:05.900 --> 00:34:13.025
the options were very clear that that was like the best set. And also it had the most kind of well set up kind of governance structure around that as well.

342
00:34:14.125 --> 00:34:21.280
Because we we don't want there to be trouble there. So so it it it just ended up being that that was Dirk's right side and the easy set to go with.

343
00:34:21.580 --> 00:34:26.115
And, 3 felt like a good number, and, like, ultimately, 10% of the,

344
00:34:26.595 --> 00:34:28.615
the net profits of that product was also

345
00:34:29.075 --> 00:34:32.775
just a number, but 10 felt like the right number. And It's a big number.

346
00:34:33.460 --> 00:34:34.820
Yeah. They yeah. But,

347
00:34:35.300 --> 00:34:42.580
I mean, I wanted the meme number of 21%, but, you know, I'm not gonna complain. Yeah. Yeah. Yeah. So that that's how we ended up with it. Yeah. Yeah. I,

348
00:34:43.285 --> 00:34:44.184
I will say as someone

349
00:34:44.565 --> 00:34:45.065
who

350
00:34:49.045 --> 00:34:52.345
is intimately involved with raising money for Open Sats,

351
00:34:52.930 --> 00:34:54.550
I'm very grateful

352
00:34:55.090 --> 00:34:56.630
for the long term commitment

353
00:34:56.930 --> 00:34:59.030
because I make no money from Open Sats.

354
00:34:59.735 --> 00:35:03.195
And this idea that I have to just constantly be calling people

355
00:35:03.975 --> 00:35:08.235
and texting people and circling back to try and get new commitments,

356
00:35:09.230 --> 00:35:11.810
The reoccurring model is a breath of fresh air.

357
00:35:12.830 --> 00:35:16.530
You know, 10 years is, like, a 100 years in Bitcoin terms.

358
00:35:16.990 --> 00:35:18.110
So I have, like, a century,

359
00:35:19.454 --> 00:35:24.115
I have a century commitment. You know? I, it it it it is it is

360
00:35:24.815 --> 00:35:29.540
it is a massive it's a massive departure from the usual, like, one off donations.

361
00:35:30.160 --> 00:35:31.860
So I appreciate that. I'm curious.

362
00:35:32.560 --> 00:35:34.020
What do you say to the critics

363
00:35:35.015 --> 00:35:38.875
that say, well, you know, 10% of profits right now, like, isn't that much?

364
00:35:40.855 --> 00:35:43.675
I think we have really big ambitions for the product. Yeah.

365
00:35:44.810 --> 00:35:46.270
I think something that,

366
00:35:50.490 --> 00:35:51.050
something that,

367
00:35:53.135 --> 00:35:56.675
so so so let's just, like, kind of do the rough math. I think, like, we have,

368
00:35:57.375 --> 00:35:58.035
a $2,000,000,000

369
00:35:58.415 --> 00:36:01.234
product right now. 20 basis points means that we have 4,000,000

370
00:36:01.730 --> 00:36:07.890
in annual revenue from that product now. Right. And, let's say it has a 50% profit margin. Okay. So so then,

371
00:36:10.435 --> 00:36:19.335
2,000,000 in kind of, like, profits from the product, and 10% of that would be 200 k. Right. Not a game changing amount of money. I recognize that. But if that 10 x's,

372
00:36:19.690 --> 00:36:23.230
yeah, it's that 100 x's, then it can be a meaningful amount. And,

373
00:36:23.930 --> 00:36:24.590
it can

374
00:36:25.050 --> 00:36:25.550
like

375
00:36:26.815 --> 00:36:27.315
and

376
00:36:27.694 --> 00:36:33.075
and also, I'm not here saying that we're solving open source funding You did it. Problem. You did it, Hong. You solved it.

377
00:36:33.454 --> 00:36:36.035
Like, I'm saying that we want to Mission accomplished.

378
00:36:36.760 --> 00:36:38.839
We want to pull our weight. Yeah.

379
00:36:39.240 --> 00:36:40.300
And and

380
00:36:40.680 --> 00:36:43.660
it is kind of well incentive aligned if we have more success.

381
00:36:44.015 --> 00:36:47.155
But but but but maybe to just paint a picture a little bit about, like,

382
00:36:48.735 --> 00:36:50.755
how it could be a bigger product is

383
00:36:52.390 --> 00:36:55.849
so GLD, which is the 4th gold ETF in the US, launched in

384
00:36:56.150 --> 00:36:57.529
2004. Yeah. And

385
00:36:57.910 --> 00:37:08.385
that in the first 3 days or a week gathered about $1,000,000,000 in assets. Right. That was the most successful, wildly, like historic launch, like $1,000,000,000 in 3 days. Crazy.

386
00:37:09.359 --> 00:37:15.539
And then the next 3 months maybe gathered about another half $1,000,000,000 or so, like a 1,000,000,000 and a half, and then it kind of died out there.

387
00:37:15.885 --> 00:37:33.664
And then people thought that it was an event that came and passed because, like, launched 1st day 1st few days is 1,000,000,000 and then, like, a a little bit more trickled in, and then, like, it's it's quiet now. Right. The reality of what happened after that is that, like, the next year in 2005, maybe about another 2,000,000,000 came in.

388
00:37:34.525 --> 00:37:37.345
Next year, I think about, like, 3, 3a half,

389
00:37:38.680 --> 00:37:39.180
5,

390
00:37:39.480 --> 00:37:40.700
and then there was a $10,000,000,000

391
00:37:41.480 --> 00:37:45.099
year. Ultimately, there were positive inflows that were growing,

392
00:37:46.205 --> 00:38:01.240
and the kind of like sustaining in those levels for another 8 years after that, that were, and the launch year was an insignificant moment in the grand scheme of things. And I think that is also likely what we will see with Bitcoin ETFs as well. We had a historic time.

393
00:38:01.619 --> 00:38:03.460
We launched in the 1st month. Right.

394
00:38:04.495 --> 00:38:09.405
Outside of GBT's flows, we had maybe a 2 or 3,000,000,000, and then in, like, next 3 months, we had, like, 10,000,000,000 or so. So, like, we had, you know, an incredible incredibly successful,

395
00:38:14.220 --> 00:38:19.360
debut. I mean, if you think about it as kind of like maybe, like, an IPO moment, like, it was a successful IPO.

396
00:38:19.900 --> 00:38:21.040
It beat all expectations.

397
00:38:21.625 --> 00:38:33.230
Yeah. It beat all expectations. And and I but I think there's a way in which Like, it insanely beat all expectations. Yeah. Yeah. It it only beat be all There was people that say it was a nonevent. It was a sell the news event. Yeah. Yeah. Yeah. Yeah. And I think those people,

398
00:38:33.609 --> 00:38:50.140
Were wrong. Yeah. Were wrong and and regretted it. And and I think the market priced that in as a, like, you know, the market dipped because people thought that it was the the sell that it was over. It didn't launch. Yeah. Yeah. Yeah. And after the 1st month, it seemed like the things were quieting down. And then on month 2 and 3, another $10,000,000,000 of net flow showed up, and then everyone And now we're at $65,000.

399
00:38:51.080 --> 00:38:56.465
Yeah. Yeah. Yeah. So, like, price went up, like, 50%, and and the market has kind of adjusted to that new reality now. But,

400
00:38:58.125 --> 00:39:00.705
what I'm trying to paint the picture here a little bit is that, like,

401
00:39:01.005 --> 00:39:02.305
there's a way in which

402
00:39:02.980 --> 00:39:03.880
crypto Twitter,

403
00:39:04.260 --> 00:39:05.000
or traders

404
00:39:05.460 --> 00:39:13.055
kind of like to think about the ETF moment as, like, an event, like, and the market event. A singular event. A singular event, and it came and went.

405
00:39:13.515 --> 00:39:16.655
But in reality, it's much closer to like a state change.

406
00:39:17.190 --> 00:39:31.924
Right. It's much more closer to paradigm. A company going public. Like, it's not that the company itself changed. Like, why you would invest in the company? What is the value or the moat of the company, why it exists, didn't change. But when a company goes public, it just goes from having private market liquidity

407
00:39:32.300 --> 00:39:46.865
to public market liquidity. The amount of market participants and the dollars that can really easily engage with that company's stock just changes and it changes forever. It doesn't never unless it delists, It doesn't it it just maintains that, and I think that's closer to what we have here.

408
00:39:47.325 --> 00:39:47.805
And,

409
00:39:48.205 --> 00:39:56.050
and but but that state change is now a new world in in terms of just, like, kind of public market liquidity, but saturating the opportunity set

410
00:39:56.430 --> 00:40:00.505
is just gonna take some years. And to paint a picture a little bit there, like, most of the dollars

411
00:40:01.265 --> 00:40:07.630
time. Yeah. Like, we think think about, like, the like, wire houses, like, large banks, like Morgan Stanley or UBS or Wells Fargo, these firms,

412
00:40:09.069 --> 00:40:13.250
a financial advisor that's managing money for, like, their clients can't really

413
00:40:13.789 --> 00:40:24.234
put a Bitcoin ETF into their portfolios yet. It's considered high risk. It's new. It's No. It's just not approved for that. So so so currently, it's allowed if the client asks,

414
00:40:24.579 --> 00:40:43.690
but there is no discretionary allocation that's allowed. It's just not allowed by the home office, and they're going through due diligence. And due diligence for ETFs, new ETFs usually take, like, 6 to 12 months. I think everyone is racing towards trying to do a little bit earlier because They're all competing too. Yeah. Yeah. They're all competing, and they're all also trying to, like, meet their client needs. Right. You know, they they have customers that want it, but,

415
00:40:44.869 --> 00:40:48.490
but it's still they're like, the first firms are, like, coming out of the woodwork there,

416
00:40:49.109 --> 00:40:49.930
really, like,

417
00:40:50.365 --> 00:40:56.705
because we're now 4 months in, 5 months, it's just like the first set of firms are starting to come out of the, the tunnel.

418
00:40:57.005 --> 00:40:57.745
And so

419
00:40:58.420 --> 00:41:05.960
really in terms of, like, actually Bitcoin ETFs taking in the money that was, like, structurally unable, like, the public market liquidity

420
00:41:06.265 --> 00:41:10.605
that really wasn't able to interact with it. We we got, like, a taste of it, like, the the $12,000,000,000

421
00:41:10.985 --> 00:41:14.685
that showed up in the 1st 3 months Right. Was a taste of that. A small taste. But really,

422
00:41:15.470 --> 00:41:22.369
that takes time. It's the tip of the iceberg. Yeah. And even after they have discretionary ability to so right now, it's just not allowed.

423
00:41:22.829 --> 00:41:23.970
Once it gets allowed,

424
00:41:24.605 --> 00:41:50.974
I mean, if you think of even how, like, the retail played out, it Right. It played out over time. Like, people put in a little bit amount, and then they lose that money or, like, they go through the volatility, and then they realize that they should have, like, just held on to it, and then they put in a little bit more. Stack sets. Yeah. Yeah. And and they learn about Bitcoin, and then they learn about, like, auction economics. It just takes time. So I think, like, right now, the gates haven't even really opened for them, and it will open, and then they will all find out, like, find their ways in. And and that's why

425
00:41:51.529 --> 00:41:52.509
a product like GLD

426
00:41:52.809 --> 00:41:54.269
just had incrementally

427
00:41:54.569 --> 00:41:55.069
higher,

428
00:41:56.250 --> 00:41:58.829
flows for years that ultimately, like,

429
00:41:59.425 --> 00:42:06.360
paled the 1st launch year. Launch year again was like $1,000,000,000 and like 4 or 5 years later, a single year bought in like 10.

430
00:42:06.840 --> 00:42:07.900
So I think,

431
00:42:08.360 --> 00:42:12.540
that's the dynamic that we're at play, and we're just so early, like, like, yes,

432
00:42:13.320 --> 00:42:16.220
that's why we're bullish and why we're, like, really committed

433
00:42:16.665 --> 00:42:22.445
and excited about this part of the journey. Because now that Bitcoin is, like, a little sideways, a little bit died down,

434
00:42:23.065 --> 00:42:25.869
all the other firms like BlackRock, still ultimately

435
00:42:26.329 --> 00:42:32.349
is a small product for them or like Fidelity or or are they all have other asset classes that are much bigger. Baby.

436
00:42:33.315 --> 00:42:36.375
We're we're focused on only one thing. Like, we don't have another,

437
00:42:37.234 --> 00:42:37.734
$2,000,000,000

438
00:42:38.035 --> 00:42:49.230
product out there. And and so I think this is kind of the part that we feel excited about. They're not trying to show me a copper ETF, you know? Yeah. Yeah. Yeah. I'm not gonna be talking about, like like, Chinese equities or or

439
00:42:49.615 --> 00:42:50.355
fixed income,

440
00:42:51.135 --> 00:42:52.835
or or something like that tomorrow.

441
00:42:53.454 --> 00:42:54.674
And and and so

442
00:42:55.214 --> 00:42:56.115
yeah. Anyways,

443
00:42:56.870 --> 00:43:02.410
I think I think, basically, I think the message is that, like, the category is actually much bigger than what it seems now,

444
00:43:02.790 --> 00:43:09.615
and it can grow into something much bigger, not just from prices going up, but also just from saturating the public market opportunity.

445
00:43:10.395 --> 00:43:13.135
And I think if we do that well, our

446
00:43:13.755 --> 00:43:16.255
ETF could be a much bigger product and hopefully,

447
00:43:16.940 --> 00:43:22.560
donate a lot more to to Dez as well. Yeah. I mean, I think, like, on the institution side, like, you have institution level,

448
00:43:23.580 --> 00:43:24.640
time that takes

449
00:43:25.915 --> 00:43:32.174
family offices, as you talked about. I mean, family offices are a big part of the American economy that people should not discount.

450
00:43:33.035 --> 00:43:33.934
That's like

451
00:43:34.600 --> 00:43:36.540
money managers of rich families.

452
00:43:37.960 --> 00:43:46.015
But even on, like, the individual level, I mean, we saw so many stories. I still hear stories of, like, people going to, like, their broker at UBS or their broker

453
00:43:46.795 --> 00:43:59.980
at Morgan Stanley or whatnot and be like, I wanna buy the ETF. And they just send them through so many hoops if they even let them buy one of the ETFs to begin with. Yeah. And these things take time. So, like, it really is definitely a paradigm shifting moment.

454
00:44:00.775 --> 00:44:06.714
And my answer is is quite simple when people give me that critique. My answer is, like, look. At the end of the day,

455
00:44:07.095 --> 00:44:08.875
Bitwise put their balls on the table.

456
00:44:10.200 --> 00:44:13.020
They directly aligned it with how much money they're making.

457
00:44:13.480 --> 00:44:13.980
So,

458
00:44:14.920 --> 00:44:21.145
if you have any critique on no matter how much money they're making, it's 10% of it, which is a sizable portion.

459
00:44:22.485 --> 00:44:25.545
So that's huge. The second thing is is

460
00:44:25.845 --> 00:44:27.145
I say, our

461
00:44:27.670 --> 00:44:31.770
the the the deal we made is is that 5 to 10 year

462
00:44:32.710 --> 00:44:34.569
the years 5 through 10

463
00:44:34.925 --> 00:44:38.625
are where it's gonna be most significant from an absolute

464
00:44:39.085 --> 00:44:39.585
terms,

465
00:44:39.885 --> 00:44:42.145
and I won't have to call you back at that point.

466
00:44:43.119 --> 00:44:48.580
You've already committed to it, which is huge. And then third of all, you've told everyone else on the cliff

467
00:44:49.414 --> 00:45:02.310
why, you know, why aren't you doing what we're doing? Like, why is why is GBTC not supporting open source developers? Why is BlackRock not? Why is Fidelity not? Why is Arc not? And they've noticed. Like, they they have definitely noticed,

468
00:45:02.930 --> 00:45:03.670
and and

469
00:45:04.770 --> 00:45:06.130
I I do not think

470
00:45:07.775 --> 00:45:11.315
I I think it's it's very hard to overstate

471
00:45:12.415 --> 00:45:13.955
what you guys have done,

472
00:45:14.710 --> 00:45:18.170
and most people are understating it. I remember

473
00:45:19.430 --> 00:45:20.810
Hong messaged me,

474
00:45:21.349 --> 00:45:24.170
like, a week before the ETFs approved, and he's like,

475
00:45:24.615 --> 00:45:27.115
we have no idea if they're gonna get approved or not.

476
00:45:28.295 --> 00:45:30.155
Like, I have no insider information.

477
00:45:31.495 --> 00:45:32.955
But if we do get approved

478
00:45:33.700 --> 00:45:36.120
on the date that everyone expects us to get approved,

479
00:45:36.820 --> 00:45:39.320
like, I would love to have you on the Twitter spaces.

480
00:45:40.580 --> 00:45:46.265
Is that out of the question because it's the demon app? Because you you knew I didn't like I didn't like Twitter.

481
00:45:46.565 --> 00:45:50.984
And I was like, yeah. Sure. Sure. I'll go on Twitter spaces right before I I deleted my account.

482
00:45:53.050 --> 00:45:54.430
And our Twitter spaces

483
00:45:55.050 --> 00:45:56.030
had, like, a 150

484
00:45:56.330 --> 00:45:57.230
people in it.

485
00:45:57.770 --> 00:46:06.285
Like, we did not have that many there was there was the the big some of the other ETFs had massive Twitter spaces, and they had, like, a full celebrity

486
00:46:06.825 --> 00:46:12.940
group of influencers, like, all on stage or whatnot. And we're just talking about supporting open source contributors.

487
00:46:13.640 --> 00:46:15.260
And I I think, like,

488
00:46:15.800 --> 00:46:20.184
a lot of people fated it. A lot of people fated it. And the fact that you guys had the conviction

489
00:46:20.484 --> 00:46:23.385
and the aggressiveness to actually make it fucking happen

490
00:46:24.164 --> 00:46:31.150
is is why we're here today, but is also, like, why it's a significant thing. And I think it's something that, like, goes down in history books. Like, I think

491
00:46:32.010 --> 00:46:34.270
I think it's, like, it actually does.

492
00:46:34.845 --> 00:46:40.785
It it it will make the difference as time goes on, and people will look back and be, like, holy shit.

493
00:46:41.085 --> 00:46:43.744
Like, Bitwise really did lead the charge there.

494
00:46:44.510 --> 00:46:48.210
I've had so many private conversations where people are like, that Bitwise news

495
00:46:48.830 --> 00:46:56.575
was the one of the most incredible things I've ever seen. And I I do I really appreciate you, Hong, for for leading the charge there, and and

496
00:46:56.875 --> 00:46:58.255
and thank you. Wow.

497
00:46:59.355 --> 00:47:01.650
Thanks for saying that. I think,

498
00:47:02.510 --> 00:47:03.810
I'm feeling a little emotional.

499
00:47:04.349 --> 00:47:04.849
But

500
00:47:05.710 --> 00:47:06.430
I really do

501
00:47:10.025 --> 00:47:13.325
yeah. I think there is a way in which it was not,

502
00:47:15.065 --> 00:47:22.570
like, in retrospect, now that Bitwise had some success, I think it's easy to say that, like, oh, yeah, it was a good business move, blah, blah, blah. But I think

503
00:47:23.110 --> 00:47:31.825
and and and now we're even having a conversation about, like, why are these other players not doing it? And And that is a conversation to be had. Yeah. It's a conversation to be had because

504
00:47:32.204 --> 00:47:33.425
an alternative exists.

505
00:47:33.805 --> 00:47:37.760
And I think there is. Yeah. Yeah. So I appreciate you kind of recognizing that that,

506
00:47:38.700 --> 00:47:40.000
required someone on a conviction.

507
00:47:41.660 --> 00:47:42.400
I mean,

508
00:47:44.015 --> 00:47:46.995
I think ultimately it, it, it really was,

509
00:47:48.575 --> 00:47:50.490
I mean, I did think about the business aspects of it as well, but also it was just a right,

510
00:47:53.430 --> 00:47:53.930
thing.

511
00:47:55.150 --> 00:47:55.650
We're

512
00:47:56.869 --> 00:47:57.845
ultimately Bitcoin.

513
00:47:58.484 --> 00:47:59.224
The right,

514
00:48:00.325 --> 00:48:03.285
thing. We're we're ultimately Bitcoiners. Yep. Like

515
00:48:03.685 --> 00:48:10.610
and and this is something The business rides or dies on Bitcoin. Like, Bitcoin fails, you guys are fucked. Yeah. Yeah. And also also,

516
00:48:11.230 --> 00:48:11.890
I mean,

517
00:48:12.590 --> 00:48:15.250
even beyond the business, and and I think this is,

518
00:48:17.244 --> 00:48:22.944
like, Bitcoin is just a very important thing for the world. Right. That's why most of us are here. Yeah. Like,

519
00:48:24.130 --> 00:48:24.630
the

520
00:48:25.170 --> 00:48:27.990
the idea of, like, a user controlled money.

521
00:48:29.650 --> 00:48:30.550
And I think

522
00:48:31.625 --> 00:48:36.285
it's just a radical idea that is very important to, and it just doesn't have

523
00:48:36.585 --> 00:48:37.085
like,

524
00:48:38.160 --> 00:48:43.460
just just obviously is going to work out. Obviously, is it going to win? I think there's a way in which,

525
00:48:45.605 --> 00:48:51.785
there's sometimes I feel like a bit of a complacency in people. Yeah. I mean, because because I I also There's a lot of complacency.

526
00:48:52.244 --> 00:48:59.599
I mean, I also get it as well. Like like, there's so much, like, bad faith critiques that I think when we talk about it in public, I don't like giving,

527
00:48:59.980 --> 00:49:00.480
like,

528
00:49:01.045 --> 00:49:17.880
showing weakness. Like, best Bitcoin critics are Bitcoiners. Yeah. Yeah. Yeah. So so so, like, when when I'm talking about it publicly with people that are, like, putting forth, like, bad faith arguments against it, then, of course, I'm like, yeah. Bitcoin is is rock solid. You like, that's all, like, bad argument. Well, like, I would I would do that. I would kind of do the microsailer.

529
00:49:18.275 --> 00:49:27.175
Right. But in in with Bitcoiners, I think we can recognize that, like, it's just not a given that this is a thing is going to be allowed to exist and work and be secured,

530
00:49:27.660 --> 00:49:28.320
and, like

531
00:49:29.020 --> 00:49:39.075
and and people think about, like, consensus stuff all the time as, like, the main thing to think about and maintain, but, like, that's a small part of what the open source devs do. I mean, ultimately, it's a network,

532
00:49:39.694 --> 00:49:41.954
and, like, the mempools are always,

533
00:49:42.414 --> 00:49:48.260
having different types of issues to navigate and different and the issues change over time, you know. Like, it's it's a live

534
00:49:48.560 --> 00:49:49.380
freaking network,

535
00:49:51.120 --> 00:49:55.380
and and all sorts of things that needs to be to be maintained. And, like,

536
00:49:55.975 --> 00:49:57.915
the, the yeah. So,

537
00:49:58.295 --> 00:50:01.595
and it's just not obvious to me that, that it,

538
00:50:02.830 --> 00:50:04.210
we can be complacent

539
00:50:04.510 --> 00:50:07.010
in, like, supporting our devs and, like, just

540
00:50:07.310 --> 00:50:11.825
expect this thing to work out. Someone else will do it. Right. Yeah. So I think,

541
00:50:14.045 --> 00:50:16.625
there's a part of part of part of that as well, that

542
00:50:16.925 --> 00:50:17.425
I

543
00:50:19.180 --> 00:50:21.280
wanted it as a Bitcoiner. Yeah.

544
00:50:22.140 --> 00:50:22.960
Yeah. I mean,

545
00:50:23.500 --> 00:50:24.000
I

546
00:50:25.180 --> 00:50:26.640
I believe we

547
00:50:27.615 --> 00:50:28.675
will do this thing,

548
00:50:29.135 --> 00:50:32.755
but I believe we will do it because people stand the fuck up and make it happen.

549
00:50:33.295 --> 00:50:41.609
And we haven't won yet, and we haven't made it happen yet. And and until then, people have to do things, and they have to do the hard things.

550
00:50:42.230 --> 00:50:42.630
And,

551
00:50:43.155 --> 00:50:50.695
complacency fucking kills, and I don't want, you know I I keep going back to the meme of just mission accomplished George Bush on the aircraft carrier.

552
00:50:51.660 --> 00:50:55.120
There's a lot of Bitcoiners that embody that meme. Don't be one of those Bitcoiners.

553
00:50:56.140 --> 00:50:59.280
Yeah. I mean, the reality is that, like, all the things that we,

554
00:51:00.585 --> 00:51:05.565
like public key cryptography being a thing that is that we enjoy as like a right that we have,

555
00:51:06.185 --> 00:51:09.165
is not a thing that was given to us. We fought for that. Right.

556
00:51:09.790 --> 00:51:11.570
And Continue to. And,

557
00:51:13.230 --> 00:51:18.450
yeah, it's it's just it's just gonna be something that we have to continue to fight for. I mean, just one thing about the the

558
00:51:18.845 --> 00:51:21.025
the the years 5 to 10 point,

559
00:51:22.925 --> 00:51:26.065
we don't have intentions of pulling it on year 11, at least that's

560
00:51:27.080 --> 00:51:30.460
how we think about it. We, we, we gave the 10 year number as a minimum,

561
00:51:31.480 --> 00:51:31.980
because

562
00:51:32.520 --> 00:51:35.980
saying that it's indefinite sounds in some ways like a weaker commitment

563
00:51:36.325 --> 00:51:40.025
and making a concrete number. We could do 21 years if you don't wanna do indefinite.

564
00:51:40.805 --> 00:51:42.885
I mean, what what what what what I'm saying is,

565
00:51:43.445 --> 00:52:03.490
I don't think we're we're, like, secretly looking looking to to to Year 11, you're gonna fuck us. Right? I I I mean, we if we have the success that we hope to have, then I think we'd be happy to continue to donate 10%. Well, I hope my successor at Open SaaS calls you up, year 11. Yeah. And if I'm still if I'm still involved, I just

566
00:52:05.090 --> 00:52:10.530
Yeah. I'm I'm exhausted, freaks. I'm exhausted. So but but I no. I I I never

567
00:52:11.035 --> 00:52:20.175
I I definitely didn't mean it in that respect. Yeah. Yeah. Yeah. I mean, I mean, I mean, all Me, like, 10 years is a nice round number. We did we did 10%. Yeah. Nice round number. 10 years, nice round number.

568
00:52:20.540 --> 00:52:23.520
Just just We can circle back. The audience. And and to some extent, like, of course,

569
00:52:23.820 --> 00:52:24.480
it's all,

570
00:52:25.500 --> 00:52:26.800
you have to to

571
00:52:27.260 --> 00:52:38.670
to trust our intentions to some extent that we we will continue to, and, like, that is like, it's just me me saying that. But also, I think you can attest to the fact that, like, we came to you with this. It it like, I'm not I'm not,

572
00:52:39.930 --> 00:52:43.470
No. It was the single easiest open sats deal I've ever done.

573
00:52:44.045 --> 00:52:57.780
Yeah. And and and maybe that kind of shows a little bit, of the proof of work of, like, that it was something that we decided to do, and we thought, and and so part of yeah. Anyways, we I think that's the Yeah. You're great.

574
00:53:00.185 --> 00:53:09.770
But, yeah, years 5 to 10, man. That's gonna be we're gonna Great. The open source contributors are getting a lot of money those years, I think. And we'll have bigger problems then. I,

575
00:53:10.710 --> 00:53:12.810
let's talk about so we talked about

576
00:53:13.110 --> 00:53:17.085
the the from my angle, the 2 big things that you guys,

577
00:53:18.105 --> 00:53:21.244
business just raided us. So he brought his

578
00:53:21.545 --> 00:53:24.410
audience over here. Thank you, appreciate you.

579
00:53:24.890 --> 00:53:25.950
Rat or die freak.

580
00:53:26.650 --> 00:53:31.390
Good Internet friend. I don't think I've ever met you in person. One day, maybe. That'd be great.

581
00:53:32.975 --> 00:53:35.555
Also, I wanted to say to KNI

582
00:53:35.855 --> 00:53:36.355
Calverio,

583
00:53:38.335 --> 00:53:42.220
I appreciate you. Don't, let the people in the chat bully you.

584
00:53:42.780 --> 00:53:44.160
Say whatever you wanna say.

585
00:53:44.540 --> 00:53:45.920
Our our chat is unmoderated,

586
00:53:46.300 --> 00:53:49.265
and, they can't censor you even if they wanna censor you.

587
00:53:52.224 --> 00:53:55.684
As always, freaks, you can you can join us in the live chat,

588
00:53:55.984 --> 00:53:57.125
at civil dispatch.com/stream.

589
00:53:58.850 --> 00:54:03.510
The rider died freaks that joined the live chat, make this really special. I met at

590
00:54:03.890 --> 00:54:06.710
bitcoin BitBlock Boom in Dallas. Great event.

591
00:54:09.525 --> 00:54:11.625
I can't place you. I apologize,

592
00:54:12.484 --> 00:54:13.865
but I appreciate you.

593
00:54:18.090 --> 00:54:19.050
I wanna talk about

594
00:54:20.810 --> 00:54:23.070
to me, there's there's 2 big things.

595
00:54:23.609 --> 00:54:26.845
And I I think I think there's a strong argument

596
00:54:27.224 --> 00:54:27.724
that,

597
00:54:28.905 --> 00:54:30.025
a lot of us, like

598
00:54:30.585 --> 00:54:31.724
I mean, me, personally,

599
00:54:32.265 --> 00:54:32.765
I'm

600
00:54:34.340 --> 00:54:37.160
probably as anti ETF as they come.

601
00:54:39.780 --> 00:54:43.080
Self custody all the way, use your own note. I'm like,

602
00:54:43.925 --> 00:54:48.265
don't trust third parties. But at the end of the day, like, I have a lot of friends and family

603
00:54:49.125 --> 00:54:54.400
that the Bitcoin ETFs opened up a whole like, opened up the possibility for them to actually

604
00:54:55.020 --> 00:54:56.640
hold Bitcoin for the first time

605
00:54:56.940 --> 00:55:04.085
or hold a Bitcoin ahead of you for the first time. And I always just recommend them Bitb. Right? Like, I recommend them your product because

606
00:55:04.785 --> 00:55:06.645
I think it's it's most aligned

607
00:55:07.130 --> 00:55:10.029
with ethos, and I think just dropped from the open source

608
00:55:10.890 --> 00:55:13.965
contribution side is fucking massive. And I tell them that's why.

609
00:55:14.925 --> 00:55:17.265
And and I I think there's a strong argument.

610
00:55:18.125 --> 00:55:22.360
And this is why, me, personally, like, I always focus on the rider dies. Like, the rider dies

611
00:55:22.760 --> 00:55:30.125
are the people that go out there, and then they they talk to a 100 people, a 1000 people, and you don't know who those a 100000 a 100 to a 1000 people are.

612
00:55:30.685 --> 00:55:33.105
They could be movers or shakers or wherever they are,

613
00:55:33.565 --> 00:55:34.785
and they get shit done.

614
00:55:36.525 --> 00:55:43.240
But the transparency is really cool. I think it's really cool what you guys have done in terms of proof of reserves, in terms of Hoseki.

615
00:55:45.460 --> 00:55:52.895
I I think we should talk about that a little bit. So, like, what was your what was your thought process on on proof of reserves and

616
00:55:53.260 --> 00:55:56.160
and and making your addresses public? I mean,

617
00:55:57.020 --> 00:56:03.385
I don't think there's not a single ETF that has done it besides you guys. Right? So so on the open source side, Van Eck,

618
00:56:04.005 --> 00:56:07.065
which is a smaller ETF, much smaller ETF,

619
00:56:07.685 --> 00:56:08.745
they give 5%

620
00:56:09.300 --> 00:56:10.920
of their profits to Brink.

621
00:56:12.980 --> 00:56:13.480
Besides

622
00:56:13.859 --> 00:56:14.359
Bitwise

623
00:56:14.980 --> 00:56:15.800
and VanEck,

624
00:56:16.975 --> 00:56:18.195
nobody else is giving

625
00:56:18.735 --> 00:56:19.955
to open source contributors.

626
00:56:21.215 --> 00:56:30.700
And then you guys are the only ones who have actually made your addresses public and done proof of reserves, and you went even farther with Hoseki in terms of, like, proving ownership of those addresses.

627
00:56:31.080 --> 00:56:32.300
How do you think about that?

628
00:56:32.680 --> 00:56:33.180
Yeah.

629
00:56:34.255 --> 00:56:41.394
Yes. That one is another one that I I would hope the other ETFs would, also consider. I mean, it's been some time now, so I think it's

630
00:56:43.600 --> 00:56:46.020
in a 2nd case, how did we think about that?

631
00:56:46.640 --> 00:56:47.620
I mean, ultimately,

632
00:56:48.480 --> 00:56:49.620
again, I'm a Bitcoiner

633
00:56:49.985 --> 00:56:51.925
and I've just been frustrated with,

634
00:56:54.305 --> 00:56:55.125
all the

635
00:56:55.425 --> 00:56:56.485
shit over the years

636
00:56:56.865 --> 00:56:58.325
of custodial products

637
00:56:58.750 --> 00:57:07.855
not having transparency, and then ultimately them growing to become kind of systemically large and then, and then blowing up and, and kind of the community having to

638
00:57:08.155 --> 00:57:11.615
then clean up the mess and kind of, like, move on from that. And,

639
00:57:13.995 --> 00:57:20.340
when we got to a certain size, I think we were either a 1000000000 or 2,000,000,000 I think like month 2 we were 2, but like,

640
00:57:21.140 --> 00:57:22.760
it felt like it

641
00:57:23.315 --> 00:57:25.335
now we were sitting on an amount of Bitcoin.

642
00:57:25.795 --> 00:57:27.895
That is a pretty meaningful amount of Bitcoin.

643
00:57:28.355 --> 00:57:28.855
And,

644
00:57:32.270 --> 00:57:35.090
like, we should do it is kind of,

645
00:57:35.630 --> 00:57:36.690
there's no,

646
00:57:37.070 --> 00:57:43.645
like, argument not to ninja launched it. What? You kinda, like, just woke up one morning and just, like, tweeted out your addresses.

647
00:57:45.145 --> 00:57:51.350
I mean, it was it was considered. I mean, we we did have to I mean, the the reason that we could've do it, like, immediately after day 1 or something,

648
00:57:51.890 --> 00:57:56.710
because we didn't fully think it through at that time. And then once we started thinking it through,

649
00:57:57.575 --> 00:57:59.035
it still took some time with, like, legal and compliance. Like, everyone still had like, we had to make sure that it was,

650
00:57:59.655 --> 00:58:02.635
buttoned up, but we're we're, you know, we

651
00:58:06.890 --> 00:58:12.110
don't take like years of these these things. So, so like a month or 2 was enough for us to, to get clarity there.

652
00:58:12.410 --> 00:58:16.825
And yeah, and I, and I think that's another area where I feel

653
00:58:17.285 --> 00:58:26.460
excited that we can kind of be an example because like, no one can say that it's not doable. Right. You did it. Yeah. Yeah. And we You did the thing. We definitely take,

654
00:58:27.000 --> 00:58:32.140
like, legal compliance, regulatory stuff very seriously. We've worked with SEC for 6 years on this product, like,

655
00:58:32.744 --> 00:58:35.404
so I think nobody can say that, like, it's not

656
00:58:36.505 --> 00:58:37.885
allowed or like it's not doable.

657
00:58:39.785 --> 00:58:40.285
And,

658
00:58:41.224 --> 00:58:41.724
and

659
00:58:42.250 --> 00:58:43.950
like another few things is just like,

660
00:58:44.410 --> 00:58:45.550
I was also a little

661
00:58:46.250 --> 00:58:47.150
post launch,

662
00:58:47.770 --> 00:58:48.990
feeling a little bit

663
00:58:49.454 --> 00:58:56.070
like people were treating it a little bit too much like gold or like that type of narrative. Like, I like the digital gold narrative as an investment narrative,

664
00:58:56.470 --> 00:59:05.210
but when people go too far in thinking that that's literally what it is, then they don't understand that they're dealing with a radically different thing here. Right. Like,

665
00:59:06.315 --> 00:59:11.694
gold cannot do proof of reserves. Yeah. Like, gold, you cannot securely custody, but also publicly

666
00:59:12.970 --> 00:59:13.470
verify

667
00:59:14.010 --> 00:59:18.349
or or or maintain public transparency about your holdings. It's one of the benefits of Bitcoin.

668
00:59:18.730 --> 00:59:22.765
Absolutely. Like, is that like That someone around the world can trustlessly verify

669
00:59:23.145 --> 00:59:27.165
ownership without without giving them custody. Exactly. Like, public auditability

670
00:59:27.625 --> 00:59:32.970
is, like, one of the really big strengths of Bitcoin as an asset and network and idea.

671
00:59:33.510 --> 00:59:35.270
And there's there's a way in which,

672
00:59:36.790 --> 00:59:47.850
like, the GLD people were, like, actually, they they took pictures, like, in the gold vault Yeah. Yeah. Yeah. Yeah. Proves nothing, really. It proved nothing. But but but but that's just the best they can do. But just to show, like, what a difference

673
00:59:48.170 --> 01:00:14.220
difference there is between Bitcoin and gold. Exactly. Like like, GLD launched, GoldBugs were, like, upset about GLD because, like, how do you know that paper gold? And then, like, they they did it, like, a media tour of, like, bringing some people inside to the vault and, like, taking pictures. They took selfies inside the vault. Legit. Yeah. Yeah. And, like, that's supposed to prove a point. Look at all this gold. Yeah. But we're there's a way in which we're kind of treating Bitcoin in the same way, and that frustrates me a little bit. Or or, like, it's it's not like the full

674
01:00:16.300 --> 01:00:29.710
and and to some extent, like, showing versus tell telling is is always more effective. It's so much more effective. Yeah. Yeah. Like, we can talk about, like, oh, there's a public key and there's net blockchain. Change you want to see in the world. Fucking do it. Do the thing. Yeah. But, like, when

675
01:00:30.330 --> 01:00:34.975
you show the address to people, like, set of addresses to people and, like, look, it's here.'

676
01:00:35.755 --> 01:00:45.380
It doesn't mean that it's the custody is not safe. That's how public key cryptography works, and that's how Bitcoin works, and like, you can have public audibility without it being any more at risk at loss

677
01:00:45.680 --> 01:00:47.780
and, like, don't have anyone tell you otherwise

678
01:00:48.240 --> 01:00:48.740
and

679
01:00:49.200 --> 01:00:54.805
even a regulated product like us can do it, like, when you show it to people, then I think people have to

680
01:00:55.265 --> 01:00:56.005
have to,

681
01:00:57.505 --> 01:01:00.085
go through some cognitive dissonance in, like, really

682
01:01:00.550 --> 01:01:09.930
trying to think through what is different here and come to realize that like gold and Bitcoin isn't, isn't, it's nowhere near the same thing. And especially also like when people,

683
01:01:10.315 --> 01:01:23.850
and it's a really important part because when people think about things like, let's say, free banking Yep. At the gold era and Bitcoin era, they they kind of talk about it as if it has the same set of risks. That is just not true. Yep. Because you can have the type of public transparency and accountability

684
01:01:24.470 --> 01:01:30.545
while having custodial services. That's just not possible with gold and probably with Bitcoin. And and so anyways, like, I just,

685
01:01:31.965 --> 01:01:32.365
wanted

686
01:01:33.805 --> 01:01:46.810
yeah. It wasn't like I one day woke up and I was like, we're shipping this. It kind of felt like that. It it kind of did post launch. I think there was a way in which it was very successful, but but it was successful in a way that kind of too much of it was kind of, like, removed,

687
01:01:47.825 --> 01:01:52.005
and wanted to push to surface more of like Bitcoin ness

688
01:01:52.305 --> 01:01:53.125
to the product,

689
01:01:53.425 --> 01:01:57.940
and then really started pushing our legal and compliance team and and like kind of like or like, I mean,

690
01:01:58.240 --> 01:02:00.500
to give them a ton of credit there,

691
01:02:01.200 --> 01:02:03.885
we have we didn't build a firm of like,

692
01:02:05.085 --> 01:02:16.849
people that don't also have this ethos. They are also Bitcoiners. So so they are trying to make this work in a way that we still don't get into trouble. And And so they're trying to dot, you know, dot their I and cross the t's and, like

693
01:02:17.150 --> 01:02:20.930
but but they they did the work, and then we came out feeling that there's nothing

694
01:02:21.230 --> 01:02:27.215
no problem here, and then we move forward with that. Yeah. Yeah. I mean, one of the I think one of the coolest parts about Bitcoin companies is,

695
01:02:28.495 --> 01:02:36.170
we've never had this before, which is like it's yeah. I I like to call it, like, almost like a shared equity. Right? Like, 1031 has 36 portfolio companies.

696
01:02:37.015 --> 01:02:41.035
Most of those companies own Bitcoin. Most of the employees own Bitcoin.

697
01:02:41.575 --> 01:02:44.395
Most of the people involved in those companies are Bitcoiners.

698
01:02:44.855 --> 01:02:48.540
And so if one company does does things that that

699
01:02:49.320 --> 01:02:49.980
are successful,

700
01:02:50.360 --> 01:02:55.020
it usually benefits everybody else, which is is something that we've just never seen.

701
01:02:55.325 --> 01:02:56.785
It just has never existed,

702
01:02:58.125 --> 01:03:01.905
which is a it's like a crazy thing to just, like, wrap your head around.

703
01:03:02.525 --> 01:03:11.490
On the transparency side, on the proven reserve side, I know it wasn't you woke up one morning and just decided to tweet out your addresses because I had been talking to you about it,

704
01:03:11.950 --> 01:03:14.050
for a while Mhmm. Before you did.

705
01:03:16.895 --> 01:03:20.995
I just wanna say to anyone who's listening that's a Bitcoin Twitter influencer,

706
01:03:23.720 --> 01:03:29.819
Just you can go fuck yourself. Like, in the whole and I know you're you you're more reserved. You're more

707
01:03:31.155 --> 01:03:35.095
deliberate in in your I'm actually pretty deliberate in my comments.

708
01:03:36.435 --> 01:03:38.455
People don't give me enough credit for that.

709
01:03:39.569 --> 01:03:40.069
But

710
01:03:40.849 --> 01:03:42.150
Bitwise comes out,

711
01:03:42.849 --> 01:03:44.230
and it's like, here's our addresses.

712
01:03:45.569 --> 01:03:48.235
And Bitcoin Twitter was just, like, overwhelmingly

713
01:03:48.535 --> 01:03:51.035
negative. They were they were just like, oh,

714
01:03:51.415 --> 01:04:00.190
like, what is not native Segwit? It's you know, like, what are you doing here? Like, look how antiquated they are. The only ETF to actually post addresses

715
01:04:00.810 --> 01:04:06.260
and and do some semblance of proof reserves, which you guys have gone even further since then, with Hoseki,

716
01:04:07.685 --> 01:04:08.745
in terms of actually

717
01:04:09.045 --> 01:04:12.085
verifying ownership of those addresses. I mean, like, any you

718
01:04:13.045 --> 01:04:17.460
Craig Wright has a perfect example of someone whose post addresses that he doesn't control,

719
01:04:18.960 --> 01:04:20.100
was just really disappointing.

720
01:04:20.400 --> 01:04:22.100
Like, get your priorities in order,

721
01:04:22.800 --> 01:04:24.740
and you don't have to comment on that.

722
01:04:25.385 --> 01:04:29.085
I think the the segued stuff, I think it's cool that you

723
01:04:29.545 --> 01:04:32.765
used your your position as a big client at Coinbase

724
01:04:33.145 --> 01:04:34.445
to push them to

725
01:04:36.340 --> 01:04:38.840
move to the new address type was cool.

726
01:04:39.780 --> 01:04:41.160
Unnecessary, but cool.

727
01:04:42.500 --> 01:04:44.120
I my bigger question,

728
01:04:44.964 --> 01:04:45.464
and

729
01:04:46.244 --> 01:04:56.230
I'm gonna kinda put you on the spot here. My bigger question is, I I think the bigger concern for a lot of people is that everyone that almost everyone is at Coinbase except for Fidelity.

730
01:04:59.089 --> 01:05:01.190
I forget who one of them is at Gemini,

731
01:05:02.095 --> 01:05:03.315
which might be worse.

732
01:05:04.494 --> 01:05:08.115
I mean, the Winklevoss twins, they don't have, like, the best record.

733
01:05:09.375 --> 01:05:13.680
I think they still owe people a $1,000,000,000 from Gemini Earn,

734
01:05:14.460 --> 01:05:15.680
thanks to Barry Silbert.

735
01:05:17.580 --> 01:05:20.320
What are your thoughts what are your thoughts on on being

736
01:05:20.635 --> 01:05:26.565
solely reliant on Coinbase custody? I I if you wanna talk about centralized points of failure, like, that is the

737
01:05:27.440 --> 01:05:34.099
the I'd like I could I could give 2 shits if it's in a legacy address versus a segued address. Totally. Totally. I,

738
01:05:34.560 --> 01:05:35.460
I see that.

739
01:05:37.005 --> 01:05:38.545
What I would say is that I

740
01:05:39.565 --> 01:05:40.065
imagine

741
01:05:41.484 --> 01:05:42.625
that the

742
01:05:43.085 --> 01:05:44.385
future is likely

743
01:05:45.390 --> 01:05:46.370
multi custodian

744
01:05:48.590 --> 01:05:49.490
and that

745
01:05:50.190 --> 01:05:51.730
that transition will happen

746
01:05:52.795 --> 01:05:54.735
in not too long of a timeline.

747
01:05:55.355 --> 01:06:01.775
Let's say, like, in 12 months from now, if it was still this concentrated with Coinbase custody, I would likely be surprised.

748
01:06:02.730 --> 01:06:05.870
So you're saying a situation where, like, ETFs are holding

749
01:06:07.050 --> 01:06:13.075
30% of 1 custodian, 30% of another, 30% of another. Mhmm. Mhmm. So a single Like, compartmentalize.

750
01:06:13.615 --> 01:06:15.475
Like, she had poor man's multisig.

751
01:06:16.575 --> 01:06:17.055
Yes.

752
01:06:17.375 --> 01:06:18.675
An an ETF,

753
01:06:19.460 --> 01:06:27.285
as a vehicle can definitely have multiple custodians. Okay. That's not a thing that is precluded. Right. We don't have any product that does that yet. Okay.

754
01:06:27.905 --> 01:06:28.465
But it's

755
01:06:28.945 --> 01:06:30.965
None of the ETFs do that right now. Right?

756
01:06:32.385 --> 01:06:35.685
Don't quote me on that. But but none that is Quoting freaks.

757
01:06:37.730 --> 01:06:39.570
That is a large product. Okay. But,

758
01:06:41.810 --> 01:06:45.750
we're definitely exploring it, and I think there's good reason to,

759
01:06:46.335 --> 01:06:49.875
imagine that that is likely where the space is going

760
01:06:50.335 --> 01:06:51.315
for many reasons,

761
01:06:51.615 --> 01:06:54.755
related to centralization that you're talking about. It's also just

762
01:06:55.930 --> 01:06:57.770
a pretty competitive market, so,

763
01:06:58.170 --> 01:07:01.310
that I think also just generates natural amount of some,

764
01:07:02.250 --> 01:07:02.750
diversity.

765
01:07:03.755 --> 01:07:09.295
Maybe some context is helpful. I I think this is Yeah. Incredibly context. Yeah. Incredibly fair critique, and I,

766
01:07:09.675 --> 01:07:11.855
would own up to anyone saying that,

767
01:07:12.460 --> 01:07:18.240
But a little bit of context about, like, why we had this amount of like, everyone just had the same choice.

768
01:07:18.619 --> 01:07:22.214
And why that happened is because we talked a little bit at the beginning of this episode

769
01:07:22.595 --> 01:07:28.570
about it. It's suddenly going, like, in October, November, going from, like, no word from the SEC to, like, they're they're

770
01:07:29.050 --> 01:07:32.750
they're giving us comments every week, and we're, like, racing towards,

771
01:07:33.530 --> 01:07:35.230
a a January deadline.

772
01:07:36.170 --> 01:07:36.670
And

773
01:07:37.050 --> 01:07:38.030
in that process,

774
01:07:40.204 --> 01:08:05.710
your worst nightmare is that, like, you're caught up in, like, comment like, replying about some specific issue, and then everyone else moves on from that. And then, like, the you don't get the day one launch. Like Right. The 8 others go, and then you're stuck for 3 months. You're dead. You're dead in the water if that happens. Even a single day, you're dead in the water. Like like, it just so much of it happens on the launch moment. So much of the game plays out in the launch moment Right. That even if you are, like, a week later, then it's over.

775
01:08:07.210 --> 01:08:07.710
So

776
01:08:08.090 --> 01:08:12.110
I think everyone had that fear, and everyone was just, like,

777
01:08:12.595 --> 01:08:15.015
trying to have the least amount of

778
01:08:15.955 --> 01:08:19.095
back and forth with the SEC as possible. Like, just one of the most noncontroversial

779
01:08:19.635 --> 01:08:21.015
selections on every dimension.

780
01:08:21.350 --> 01:08:21.850
Right.

781
01:08:22.230 --> 01:08:22.730
Like,

782
01:08:24.150 --> 01:08:26.410
so if you go at it from that perspective

783
01:08:26.790 --> 01:08:44.670
and Coinbase was a public company that Etsy was had The Goldman Sachs of crypto. I mean, it's a company that the the SEC knows and also that BlackRock chose. It was just a consensus pick, Yeah. And and and you don't want to be talking about multiple custodians. You don't wanna be talk you don't wanna be the one that is, like, bringing You're not bringing the artisan

784
01:08:45.050 --> 01:08:45.550
custodian,

785
01:08:46.250 --> 01:08:46.750
play.

786
01:08:47.595 --> 01:08:50.015
None of that. You you you I think people

787
01:08:50.475 --> 01:08:55.400
I mean, rightfully, though, but, like, it was just a crazy time. Yep. And we were, like,

788
01:08:55.880 --> 01:08:58.460
racing towards they were racing, we were racing,

789
01:08:58.840 --> 01:09:03.580
and you just did not want to raise another question. Yeah. Yeah. Yeah. Because

790
01:09:04.165 --> 01:09:12.425
this is the thing that we were look, if we after we get it out, then then everything, you know, we can talk about multiple custodians. Like, we we do everything, but, like, until

791
01:09:12.800 --> 01:09:13.120
and and

792
01:09:13.760 --> 01:09:14.820
yeah. Another issue

793
01:09:15.200 --> 01:09:26.304
that was kind of this way was I think people this crypto Twitter caught on a little bit about, but, like, in kind contribution in kind creates and redempts. Like, you can't put Bitcoin in and get Bitcoin out of this product. Yeah. That's not an ETF

794
01:09:27.620 --> 01:09:29.320
structural, like, legal I mean,

795
01:09:30.100 --> 01:09:40.115
all all gold ETFs as in kind and creates some like, all commodity products. Okay. Yeah. Yeah. So so it was an arbitrary thing that the the SEC was drawing a line about, like, with Bitcoin ETFs,

796
01:09:40.895 --> 01:09:43.395
at least for now. Oh, really? So in kind is in play?

797
01:09:44.350 --> 01:09:52.110
In kind is definitely in play. Okay. Yeah. I mean, there It doesn't require, like, an SEC rule change or something like that? No. It's just them changing their opinion about

798
01:09:52.935 --> 01:09:57.034
like, big there's these, like, weird things that the SEC has positioned about Bitcoin specifically.

799
01:09:57.574 --> 01:09:58.954
Right. Like like like like, for example,

800
01:09:59.335 --> 01:10:10.574
SAB 121 is another one of this. I think it's gotten a little bit of attention on Twitter this week. SAB 121 is, like, special accounting bulletin board item or something 121, where SEC just put out just just specifically targeting

801
01:10:10.875 --> 01:10:11.375
Bitcoin

802
01:10:12.235 --> 01:10:12.735
guidance

803
01:10:13.114 --> 01:10:18.415
around the fact that if a regulated entity like a bank wanted to custody Bitcoin for their customers,

804
01:10:19.020 --> 01:10:21.520
then they have to also have one to 1

805
01:10:22.139 --> 01:10:27.205
reserves of dollars. Fucking insane. So if you're custodying a $100,000,000 of Bitcoin for clients, so you have to

806
01:10:27.765 --> 01:10:42.469
take on the capital cost of just holding another $100,000,000 of of dollars treasury. In addition to the 100,000,000 Bitcoin you hold already. So it makes it not viable for any regulated I mean, of course, we we want more self custody and all that, but we also just want, like, it's a permissionless

807
01:10:42.770 --> 01:10:51.715
network and asset. Like, if regulated entities want to custody it for their clients, they should be able to do that as well. But the SEC is saying, no. No. No. No. We have a specific accounting

808
01:10:52.250 --> 01:10:59.975
because we think it's risky. And and and and Especially since with dollars, they're doing fractional reserve banking, so they're not even holding 1 to 1 dollars.

809
01:11:00.375 --> 01:11:09.195
And if they hold 1 to 1 Bitcoin, it still doesn't qualify because they need to hold an additional It's it's really level of dollars. It's really fucking insane. It's really

810
01:11:09.710 --> 01:11:10.370
quite absurd,

811
01:11:11.230 --> 01:11:21.505
and, it it really it went to I think the house voted on it last week. Okay. And it actually was a bipartisan like like that it was a weird, unlawful, or like this this this was not,

812
01:11:22.864 --> 01:11:26.940
it's not right. And then it it passed. And it's and now I think going up to the senate,

813
01:11:27.800 --> 01:11:28.540
but, like,

814
01:11:29.800 --> 01:11:43.164
there are these arbitrary things that is just not a legal constraint, not like what is what the spirit of the law says or, like, what this is, a specific reason that this is shouldn't be allowed, but more so just guidance level decisions by the SEC

815
01:11:43.720 --> 01:11:44.220
that,

816
01:11:45.239 --> 01:11:49.100
that really is mostly targeting Bitcoin in in some ways.

817
01:11:49.480 --> 01:11:49.980
And

818
01:11:50.975 --> 01:11:53.635
in in kind was just another one of those things. And,

819
01:11:56.015 --> 01:11:59.520
the SEC was pretty clear that, like, if you wanna be out on the first batch,

820
01:12:00.080 --> 01:12:02.580
you just have to I mean, so you brought it up, Hong.

821
01:12:05.840 --> 01:12:06.580
I think

822
01:12:08.295 --> 01:12:19.460
this yeah. So, I mean, that's the argument I make to most people behind the scenes about Coinbase. It's like no one wanted to rock the boat. They just wanted to get approved. They needed to be there for launch. Coinbase was the easy answer.

823
01:12:20.720 --> 01:12:22.100
Public company, $60,000,000,000

824
01:12:22.480 --> 01:12:23.220
mark cap,

825
01:12:24.745 --> 01:12:32.285
ex Goldman Sachs founders, selling surveillance software to US government and other governments. It was, like, it was the easy answer.

826
01:12:33.030 --> 01:12:35.770
And these things will evolve over time, and and

827
01:12:36.310 --> 01:12:40.090
and the beauty of of capitalism when it's not captured by government

828
01:12:40.645 --> 01:12:44.265
is that there's competition, and and people will improve the products. Absolutely.

829
01:12:44.645 --> 01:12:48.185
And and at the end of the day, like, what is the risk? The risk is

830
01:12:48.645 --> 01:12:50.025
that funds are lost,

831
01:12:51.030 --> 01:12:52.810
and that is a central point of failure.

832
01:12:53.350 --> 01:12:57.370
And and that is a risk that any ETF operator,

833
01:12:58.395 --> 01:13:01.695
It's about. Yeah. Obviously, because it it destroys your business.

834
01:13:02.475 --> 01:13:07.600
So the incentives make sense. But I I wanna ask you, you you you brought up this in kind redemption.

835
01:13:10.060 --> 01:13:12.159
I think we have some visitors. Yeah.

836
01:13:12.940 --> 01:13:14.595
He he's just gonna listen in.

837
01:13:16.435 --> 01:13:20.215
It's it's rare that you get to be here for an in person dispatch, so

838
01:13:23.090 --> 01:13:25.030
I respect anyone who wants to

839
01:13:25.969 --> 01:13:27.430
to enjoy it in person.

840
01:13:29.330 --> 01:13:31.430
Guys, if you come to Bitcoin Park,

841
01:13:32.175 --> 01:13:38.915
you can sit on the couch and listen to dispatch in person and get to enjoy it. So consider coming down to Nashville.

842
01:13:39.429 --> 01:13:42.650
We're having a fun time down here. In kind redemptions, Hong.

843
01:13:43.829 --> 01:13:44.489
I think

844
01:13:45.510 --> 01:13:47.050
it's incredibly predatory

845
01:13:47.765 --> 01:13:49.385
to not have in kind redemptions,

846
01:13:51.205 --> 01:13:52.585
because I think

847
01:13:53.605 --> 01:13:55.065
GBTC has proven

848
01:13:55.659 --> 01:13:57.520
that if Bitcoin does its thing

849
01:13:58.219 --> 01:14:06.545
and it goes up you. I know you agree with me, but I'm just I'm incentives are important. Right? So I wanna talk about this a little bit because you brought it up.

850
01:14:06.925 --> 01:14:12.785
And you can tell me, like, I don't wanna discuss it. Yeah. Oh, you're always welcome to do that. I told you beforehand.

851
01:14:14.240 --> 01:14:16.740
And you haven't done it yet, but you're welcome to.

852
01:14:17.920 --> 01:14:18.980
Because GBTC

853
01:14:19.280 --> 01:14:19.780
proved

854
01:14:20.240 --> 01:14:21.540
that if you have

855
01:14:22.105 --> 01:14:27.085
Bitcoin appreciation that increases the way we've seen it to do it historically,

856
01:14:28.745 --> 01:14:30.605
and you don't have in kind redemptions,

857
01:14:31.090 --> 01:14:33.830
then the only way for them to leave the lobster trap

858
01:14:34.530 --> 01:14:36.550
is to take cap gains

859
01:14:36.930 --> 01:14:40.725
so they will accept a higher fee. So if you don't have in kind redemptions,

860
01:14:41.745 --> 01:14:48.485
you can actually increase the fee over time. So it's actually the opposite of what you usually see in most industries where fees

861
01:14:49.410 --> 01:14:50.630
compress to 0

862
01:14:51.090 --> 01:14:52.710
and go down and get more competitive.

863
01:14:53.010 --> 01:14:55.590
Fees can actually go up if you don't have any kind redemptions.

864
01:14:57.595 --> 01:15:01.135
Do you think that there there's actually, like, a world where we start

865
01:15:03.115 --> 01:15:05.915
where where some ETFs, like, actually move to in kind,

866
01:15:07.090 --> 01:15:14.950
where you don't have like, you can't trap your customers. Like, you can't actually trap them in the in the product and increase your fees. Absolutely.

867
01:15:15.490 --> 01:15:15.990
Again,

868
01:15:16.705 --> 01:15:18.565
in kind is the norm

869
01:15:18.945 --> 01:15:25.205
in all other commodities spot commodity ETFs. All gold ETFs in kind is possible. There's even a gold ETF

870
01:15:25.530 --> 01:15:26.750
where if you redeem

871
01:15:27.450 --> 01:15:28.910
as an individual shareholder,

872
01:15:29.610 --> 01:15:32.670
they they can send you gold bars and coins to your door.

873
01:15:33.275 --> 01:15:41.535
They would, like, size it up and, like, send it to your door. And and and that's not a taxable event. Yeah. Yeah. Yeah. There there's, like, event. But most people, like, if you're gonna take, like,

874
01:15:42.929 --> 01:15:43.510
a $100,000,000

875
01:15:43.969 --> 01:15:45.989
in kind on gold, like, that's

876
01:15:46.770 --> 01:15:52.035
many trucks. Right? It's like it's it's difficult. Yeah. Yeah. Yeah. Yeah. But but, again, for Bitcoin, very doable. Yeah.

877
01:15:52.515 --> 01:16:09.020
With Bitcoin, you could do it from your cell phone. Yes. But but what I'm saying here is that that's allowed for gold. Right. We have a gold US ETF that does that, that delivers gold coins to your door. It's it's not that it is legally not possible or against the spirit of the securities laws or something. It is just an arbitrary

878
01:16:09.755 --> 01:16:10.495
point that,

879
01:16:11.355 --> 01:16:13.455
was drawn. And, like, we,

880
01:16:15.595 --> 01:16:16.655
we're definitely motivated.

881
01:16:17.835 --> 01:16:25.990
I mean so we don't need any rule change. We don't need any rule change. It it so so so the main thing that actually does not allow in kind redemptions right now is that the,

882
01:16:27.574 --> 01:16:28.395
the APs,

883
01:16:28.855 --> 01:16:29.915
authorized participants,

884
01:16:30.614 --> 01:16:38.370
or, like, a specific entity, do you think about broker dealers, like Right. For for our our fund, it's, like, disclosed, like, let's say, like, Goldman Sachs and, like, James Street and blah blah blah,

885
01:16:39.570 --> 01:16:40.470
are are

886
01:16:40.850 --> 01:16:43.910
the broker dealers that can create and redeem shares.

887
01:16:45.015 --> 01:16:49.275
But the current situation is that the SEC says broker dealers cannot touch Bitcoin.

888
01:16:49.975 --> 01:16:53.755
So the reason in kind is not possible, it's not because they

889
01:16:54.090 --> 01:17:03.630
specifically have something about in kind. It's about 2 things. Only broker dealers can create and redeem shares, and broker dealers are not allowed to custody or touch Bitcoin.

890
01:17:04.465 --> 01:17:07.125
And if you say those 2 things and in kind is by,

891
01:17:08.225 --> 01:17:18.150
kind of a derivative fact that it's not possible because you say only these regulated entities can create and redeem shares. Right, and those regulated entities are not allowed to touch Bitcoin, then in kind of just not possible.

892
01:17:18.690 --> 01:17:19.170
But,

893
01:17:19.650 --> 01:17:26.094
am I hopeful about the broker dealers being able to custody and service Bitcoin soon? I am. The reason I'm hopeful

894
01:17:26.554 --> 01:17:30.175
is that the tides are turning there in the sense that, like, SAB 121

895
01:17:30.820 --> 01:17:36.520
or or, like, these types of arbitrary things about regulated entities not being able to touch Bitcoin. Who's lobbying against those things?

896
01:17:37.060 --> 01:17:46.695
Who who who who who's who's, like, pushing the government on that? Actually, the banking lobby is now doing that. Because they want to get involved. Yes. Because, like, if you were a U. S. Bank and you like a Blockrock,

897
01:17:47.170 --> 01:17:48.550
they're they're effectively

898
01:17:48.930 --> 01:17:59.965
custodying a lot of customer's Bitcoin and, like, making a ton of money on that. Can't compete. Why are we not not allowed to do it? Yeah. Like, why why are you saying that the ETFs are possible and we shouldn't be able to service,

899
01:18:00.665 --> 01:18:02.700
a Bitcoin for our clients? And so

900
01:18:03.180 --> 01:18:05.820
the arbitrariness in which the SEC has been,

901
01:18:06.380 --> 01:18:08.320
kind of putting up these roadblocks

902
01:18:08.700 --> 01:18:12.000
are now being highlighted and pushed by

903
01:18:12.885 --> 01:18:35.494
banks. Yeah. The incentives are kind of The incentive is kind of pushing through the the and and and we're not even asking for any type of special treatment for the client. No. Just just let it treat it at Like non special treatment. Yeah. You're asking for non special treatment. Else. Like, every other spot commodity. Like, please, like like, let's just get it to that point. And so I I'm hopeful, like,

904
01:18:36.514 --> 01:18:41.239
that the in kind stuff get resolved in not too distant future because

905
01:18:41.700 --> 01:18:42.200
ultimately

906
01:18:42.580 --> 01:18:46.360
broker dealers and banks will solve that for us. Their business incentives

907
01:18:46.820 --> 01:18:48.120
will solve that for us.

908
01:18:49.434 --> 01:18:51.054
And then at that point, we can

909
01:18:51.594 --> 01:18:55.375
all these things are really on the table. And That'd be awesome.

910
01:18:56.010 --> 01:19:31.475
Yes. For for me, the I will be the first first person to say that the major the the main con of a Bitcoin ETF in its current form is definitely the fact that you can't take it out in kind. Without paying cap gains. Exactly. Because You have to sell it for dollars, pay cap gains, and then buy Bitcoin. Exactly. Exactly. So if you buy, this is a very common experience. You buy some Bitcoin, then it goes up 10 x, 100 x. Right. And then you and then you take it seriously. Like, you you like Every GBT dealer understands this. That's why they're paying Yeah. 1 1 and a half percent because they they have to. Otherwise, they have to pay 20, 25%, whatever cap gains. Yes. Also as a Bitcoiner,

911
01:19:31.990 --> 01:19:33.930
I am very much like everyone

912
01:19:34.790 --> 01:19:38.090
that feels comfortable doing so and, like, can educate themselves

913
01:19:38.470 --> 01:19:41.050
and should should do self custody and do, like,

914
01:19:41.685 --> 01:19:52.159
interact with the network in a self custodial way because we need more people doing that to be to for people to using these products, have a larger user base. I mean, that the government is definitely coming after

915
01:19:52.460 --> 01:19:54.079
a lot of like self custodial,

916
01:19:55.739 --> 01:20:07.849
users, and the more users we have there, I think there can be definitely much more political pressure and agreement on, like, that being something that we wanted. Anyway, there's just many reasons that, like, more people using the network directly

917
01:20:08.150 --> 01:20:10.329
is a good thing for the network, and ultimately,

918
01:20:11.829 --> 01:20:16.315
there is no world in which Bitcoin fails and, like, our ETF succeeds. Right. So

919
01:20:16.775 --> 01:20:20.875
so I I want that as Bitcoiner. I also want that as just, like it just make the product better.

920
01:20:21.255 --> 01:20:22.635
Like, I'm I'm,

921
01:20:24.615 --> 01:20:30.780
again, like, we shared a little bit in the beginning, but even though the 12,000,000,000 of the 1st year was was a big chunk,

922
01:20:31.720 --> 01:20:34.625
what's coming in the coming years are much bigger. Yeah. So so I,

923
01:20:36.625 --> 01:20:37.125
there's,

924
01:20:37.585 --> 01:21:00.230
like, we're nowhere close to thinking about, like, oh, we'll, like, raise we'll like capture a little bit more and then like start raising fees and like, we'll be good. That's not where we're at. I think we're much more closer to like, we want better products so that more people can buy this thing and we want to have the best product so that, we will win more market share because how much market share of the dollars that we win in the coming years will determine

925
01:21:00.530 --> 01:21:03.670
whether we end up with 5% market share or 50% market share.

926
01:21:04.290 --> 01:21:07.430
And we want to be at 50%, not at 5%. And so,

927
01:21:07.935 --> 01:21:11.155
yeah. We we definitely want to make in kind possible. And and

928
01:21:11.615 --> 01:21:21.930
and, you know, I know you're an ETF, a skeptic, but, like, if we have I own no ETF shares. Yeah. Yeah. Totally. Totally. I recommend Bitby and own no Bitby. Yeah. Yeah. Yeah. Totally. Totally. Totally. Disclosure.

929
01:21:22.390 --> 01:21:24.010
And but if we I own Bitcoin.

930
01:21:24.365 --> 01:21:27.025
Yes. Yes. That's great. That's great.

931
01:21:28.365 --> 01:21:29.665
But if we have inclined

932
01:21:30.125 --> 01:21:35.440
Yes. Then I do think the converse like, the ETF becomes a pretty useful,

933
01:21:36.620 --> 01:21:49.594
product in Top of funnel. Yeah. Exactly. It is like because when it goes up is when you realize why self custody matters. Yeah. Yeah. Yeah. Yeah. No one realizes why self custody matters until it goes up. Yeah. Yeah. But even if you want more people to do self custody,

934
01:21:50.090 --> 01:22:03.235
who who learns to do do self custody? People that have a lot of Bitcoin. That's what I'm saying. Yeah. Yeah. Yeah. You learn as it goes up in value. Exactly. So so so the main thing that if we want more people that own Bitcoin or soft cost of Bitcoin, etcetera, is that we just want more people that that

935
01:22:03.615 --> 01:22:05.875
have economic exposure to Bitcoin. Right.

936
01:22:06.255 --> 01:22:06.755
And

937
01:22:07.110 --> 01:22:10.410
and if we think about the process now, if if if, like,

938
01:22:12.070 --> 01:22:32.974
open up like, you have to open up a you have to not only convince someone to the put in, like, a hunt just put in a $100. Like, you you can't tell someone for the first time, like, tell them to buy a $10,000 worth of this thing. You're you're actually gonna tell them to buy a $100, but for that $100, they need to open up a new account, go through KYC AML, and then wire money or or or, like, or or It's ridiculous. It it it's it's too high of a friction. So

939
01:22:33.275 --> 01:22:36.494
imagine the amount of, like, Bitcoiners, the potential Bitcoiners that we're losing

940
01:22:36.795 --> 01:22:42.100
because we can't kind of convert like, any everything is to some extent. Friction really matters on conversion.

941
01:22:42.720 --> 01:22:43.220
And,

942
01:22:44.720 --> 01:22:46.340
as a top of funnel thing,

943
01:22:46.960 --> 01:22:56.765
it is true that Bitcoin ETFs are very like like, you could just convince someone to buy some, and then they probably have some brokerage account, and then a few taps. That's it. No accounts. No wires. No additional

944
01:22:57.210 --> 01:23:00.270
KYC. Like like, it just Yeah. They just log in to TD Ameritrade.

945
01:23:01.770 --> 01:23:17.690
Buy the yeah. Buy the ETF. And then when it goes up in value, they realize they wanna take self custody, and they go through the portal or whatever. They put their Bitcoin address. They take self custody as that as it should be. That is my ideal world. Yeah. Yeah. That is my ideal world. And and I don't think it is that far yeah. I don't think that is that far out.

946
01:23:17.990 --> 01:23:24.765
I love it, hon. Be the change you wanna see in the world. Yeah. Yeah. I mean, look Even if that means less fees for Open Sats,

947
01:23:25.225 --> 01:23:35.420
I'm I'm cool with that. I I I don't You have my blessing. Yeah. Yeah. I I just don't think that would mean less business for us. That like like, that's the thing that I I think that would be make way

948
01:23:35.900 --> 01:23:41.855
it would make your ETF way more competitive. Exactly. Yeah. That would be another reason why everyone would,

949
01:23:42.715 --> 01:23:43.534
recommend it,

950
01:23:44.155 --> 01:23:47.935
or make it as their first product that it allocates to. I mean, it I think

951
01:23:48.300 --> 01:23:53.680
it it it is is not yeah. Yeah. So We're aligned. That's dope. Definitely. Okay.

952
01:23:55.715 --> 01:24:06.240
That's fucking awesome. Okay. I did not know that. I thought we need an SEC rule change. So No. I didn't realize that was one of the things that just, like, everyone coalesced on just to get approved. That's awesome. Okay.

953
01:24:07.500 --> 01:24:09.740
We're definitely having still, even this week, someone,

954
01:24:11.660 --> 01:24:26.150
leadership from our team went and to DC to meet with SCC people around in kind specifically. So so, you know, it's a thing that we're actively That's awesome. Thank you. Talking about that. Thank you for your service. I will say I mean, you compare it to, like, something like oil

955
01:24:26.450 --> 01:24:31.750
where, like, during COVID, like, we went negative because no one can take barrels of oil in kind.

956
01:24:32.105 --> 01:24:56.425
It's, like, the most insane thing. But, like, Bitcoin, you can take in kind so easily. It's it's It's the most natural thing. It's designed for it. It is designed for it. That's right. That's right. And and but we're allowing it for for gold to, like, them to ship it into your I can take in kind of oil. I just where am I gonna fucking store the barrels? I don't know where I'm gonna put it. I should've during COVID, I should've just fucking figured it out Yeah. And just taken a bunch of barrels of oil somewhere.

957
01:24:57.680 --> 01:24:59.940
It probably would have been an environmental disaster,

958
01:25:00.880 --> 01:25:05.460
because I don't know how to store oil. But we're making progress. I I I I I do,

959
01:25:05.935 --> 01:25:09.715
like, I guess, I guess it's tough to be too bright eyed

960
01:25:10.175 --> 01:25:15.650
about, the regulatory landscape right now, given the DOJ stuff. Yeah. It's pretty bad right now.

961
01:25:16.050 --> 01:25:17.830
But for the stuff that

962
01:25:18.929 --> 01:25:23.909
has very clear business intensive aligned, like, there's no money to be made in in

963
01:25:24.364 --> 01:25:26.465
private or it's much harder,

964
01:25:27.804 --> 01:25:28.304
but,

965
01:25:28.844 --> 01:25:35.000
with stuff like this, in kind just needs broker dealers and banks to be able to do business with Bitcoin.

966
01:25:35.300 --> 01:25:36.520
It's currently not allowed.

967
01:25:37.060 --> 01:25:38.200
They'll make it happen.

968
01:25:38.580 --> 01:25:40.600
And I think there it is not

969
01:25:41.275 --> 01:25:51.600
controversial now. Like 5 years ago, if a bank wanted to custody Bitcoin and service it for their customers, I think, most people, even the public opinion, would be that, like, that bank is crazy and reckless. I don't think anyone says

970
01:25:51.900 --> 01:25:53.040
that now about Bitcoin.

971
01:25:53.420 --> 01:26:04.465
So then now that the businesses see the business, want the business, will push it forward, I think it'll happen. That's freaking good. But it requires people like you and and the Bitwise team to actually, like, make it fucking happen. So thank you.

972
01:26:05.085 --> 01:26:19.545
Yeah. You you you'll see it from us when it's when it's possible. Yeah. Yeah. You did briefly mention during authorized participants, Jane Street. I just wanted to do a huge shout out, to Tim Reynolds. His foundation did support Open Sats. He's one of the cofounders of Jane Street.

973
01:26:20.325 --> 01:26:21.625
There's Bitcoiners everywhere,

974
01:26:22.805 --> 01:26:25.385
and they're standing up and making this thing happen.

975
01:26:26.710 --> 01:26:28.329
Hong, I wanna talk about

976
01:26:29.909 --> 01:26:34.489
I wanna talk about Noster. You love Noster. I love Noster. You're on Noster. You're a

977
01:26:35.405 --> 01:26:39.425
cofounder of a company that launched a Bitcoin ETF, and you're on Noster.

978
01:26:39.805 --> 01:26:40.305
Why?

979
01:26:41.485 --> 01:26:44.865
Why are you on this ridiculous protocol that we're using?

980
01:26:47.930 --> 01:26:48.430
Because

981
01:26:49.770 --> 01:27:00.265
I think I really think about Bitcoin as user controlled money. Yeah. And I think there's a way of looking at it as like gold. It's just like this kind of perfect thing that will always be fined. And I think of it as like

982
01:27:00.565 --> 01:27:01.305
the users

983
01:27:02.270 --> 01:27:03.730
need to be vigilant

984
01:27:04.429 --> 01:27:05.090
and coordinate

985
01:27:05.630 --> 01:27:08.130
and defend this thing because it is,

986
01:27:08.750 --> 01:27:09.889
it is not our

987
01:27:11.614 --> 01:27:14.355
or it is our right, but our rights have to be defended.

988
01:27:14.975 --> 01:27:16.515
They're not always upheld.

989
01:27:17.295 --> 01:27:17.795
And

990
01:27:19.060 --> 01:27:19.720
so then

991
01:27:20.100 --> 01:27:24.680
if you imagine a type of world where users really need to be,

992
01:27:27.515 --> 01:27:29.695
vigilant to maintain this network.

993
01:27:30.315 --> 01:27:34.255
If they, if they aren't sovereign about the ways that they communicate to each other,

994
01:27:34.990 --> 01:27:37.970
then how is that coordination and resistance supposed to happen?

995
01:27:39.070 --> 01:27:40.210
Like, I don't know.

996
01:27:40.510 --> 01:27:47.895
If, like, if we're all on Twitter and there's a Twitter policy change and, like Yeah. Yoland just wakes up one morning. He's like, no Bitcoin talk.

997
01:27:48.835 --> 01:27:51.810
Then it's over. Or or I mean, I'm I'm I'm being a little bit,

998
01:27:52.930 --> 01:27:55.750
Provocative. Provocative here. But but, like, I like provocative.

999
01:27:56.770 --> 01:27:57.750
I I think

1000
01:27:58.515 --> 01:28:00.614
it is not that hard to understand

1001
01:28:01.235 --> 01:28:02.455
why kind of

1002
01:28:03.395 --> 01:28:05.655
having sovereignty over your communication

1003
01:28:06.940 --> 01:28:08.239
and identity network

1004
01:28:08.940 --> 01:28:10.880
is critical to a sovereign

1005
01:28:11.340 --> 01:28:11.840
money

1006
01:28:12.540 --> 01:28:13.440
and the users

1007
01:28:13.925 --> 01:28:15.625
and owners of that sovereign money.

1008
01:28:16.165 --> 01:28:16.565
And,

1009
01:28:17.204 --> 01:28:21.065
I think the social layer is as important as the technology layer. Yeah.

1010
01:28:22.480 --> 01:28:22.960
And,

1011
01:28:23.280 --> 01:28:25.300
as much as we care about the decentralization

1012
01:28:25.760 --> 01:28:51.445
of like the mind, like everything the code, I mean, we should care a lot more there as well. I think this recent few weeks of, like, minor centralization is also something that we should but but as much as we care about and so that that also doesn't get enough attention. So, like, that's also a problem. But but but but as much as we talk about that, I think we should also talk about, like, are do we have sovereignty over our communication? I mean, we shouldn't be talking about, like, Bitcoin consensus changes on Twitter. Like, you need a fucking account.

1013
01:28:51.824 --> 01:28:55.364
They, like, block people left and right. Like, come on, people.

1014
01:28:55.720 --> 01:28:56.940
Get your shit together.

1015
01:28:57.480 --> 01:29:01.900
And and Bitcoin consensus is not gonna be won by Twitter debates.

1016
01:29:02.600 --> 01:29:03.660
Get over yourself.

1017
01:29:04.925 --> 01:29:05.505
Be better.

1018
01:29:06.045 --> 01:29:10.224
So that there's one level there. And then I also am very excited about just

1019
01:29:10.764 --> 01:29:11.264
like,

1020
01:29:12.364 --> 01:29:13.025
I think

1021
01:29:13.420 --> 01:29:16.559
this type of web of trust is like ultimately the identity

1022
01:29:17.500 --> 01:29:18.559
layer for the internet

1023
01:29:18.940 --> 01:29:21.119
that is compatible with the ethos of the internet.

1024
01:29:22.045 --> 01:29:22.864
And also

1025
01:29:23.885 --> 01:29:26.285
something that can still practically work. Yeah.

1026
01:29:28.445 --> 01:29:29.905
I also think that

1027
01:29:30.460 --> 01:29:32.560
I'm very excited about things like, Ecash.

1028
01:29:32.940 --> 01:29:37.760
I wanna talk about Ecash. But before we talk about Ecash, are you gonna delete your Twitter account, Hong? Or yeah.

1029
01:29:41.664 --> 01:29:57.445
Yeah. Yeah. Yeah. The the reality of the matter is we're still, you know, trying to run a bit. Honestly, one of the best emails I ever got was you. Like, oh, Matt, will you join the Twitter spaces or is it just a demon app? No. That that It was like one of the best Yeah. I felt a little bad. Like like like, if if I don't know what you're you know,

1030
01:29:57.824 --> 01:30:10.580
I I felt a little bad pulling you back into it or, like, I don't know. But I hadn't posted on Twitter in 6 months, but I joined your Twitter space. Yeah. Yeah. Yeah. That's how I feel about you. Yeah. Yeah. Proof of work. Appreciate that. But yeah. Yeah. Yeah. I mean, like,

1031
01:30:11.285 --> 01:30:12.025
I also

1032
01:30:12.325 --> 01:30:15.305
recognize that a lot of these networks are really kickstarted

1033
01:30:15.685 --> 01:30:24.200
by people that take a stance like you do. And it really just kind of make the like put a stake in the ground and say that this is where I'm going to talk. And like, if you want to talk to me, come here

1034
01:30:24.820 --> 01:30:26.360
because there's a network effect,

1035
01:30:26.925 --> 01:30:29.105
and the beginning of the network effect is brutal.

1036
01:30:29.485 --> 01:30:32.625
So so some people have to make it to Yeah. So it's that, like

1037
01:30:33.085 --> 01:30:43.745
yeah. I'm doing the same thing as you. I'm I'm, like, the 5th largest Bitcoin ETF, and I'm I'm Nostra only. You know? Like, that's I'm doing the same exact thing Yeah. In a different way.

1038
01:30:44.785 --> 01:30:49.205
So You don't have to leave your Twitter. I was just fucking with you. Yeah. I couldn't put it. I had to ask.

1039
01:30:50.625 --> 01:30:51.125
ECash.

1040
01:30:52.140 --> 01:30:55.360
We're pretty excited about ECash. So excited about ECash. Yeah.

1041
01:30:55.820 --> 01:30:56.320
ECash,

1042
01:30:58.140 --> 01:31:00.400
I think people trip over the fact that it's a custodial.

1043
01:31:00.755 --> 01:31:03.415
Yeah. Whether it's, you know, single sig with, like, cashew

1044
01:31:03.795 --> 01:31:04.275
or,

1045
01:31:05.955 --> 01:31:09.095
multi sig with, like, a federation with Fediment, etcetera.

1046
01:31:12.980 --> 01:31:13.480
But

1047
01:31:16.180 --> 01:31:22.855
I think, like, you have to think about it from, like, where it fits in. Like, I think the Mutiny Wallet's approach is incredible.

1048
01:31:23.235 --> 01:31:24.455
Yeah. We're we're like,

1049
01:31:25.075 --> 01:31:34.150
if someone is just trying to get $10 of Bitcoin. Right. They should not be running a self custodial letting note. Like, I I'm sorry. They should not. Yeah. But but

1050
01:31:34.745 --> 01:31:46.850
but then like, manage the liquidity together. This is not like, you know, same thing as, like, I mean, how I feel a little bit about the Bitcoin ETF stuff as well. Like, someone's buying $10, a $100, there's it's not gonna

1051
01:31:47.230 --> 01:32:02.175
figure out so so it it's just, like, not economically viable for them, and it's also not if you add up that much much friction, then they won't do it. Right. So I I think it's very smart that they go e cash for a certain threshold of stats,

1052
01:32:02.590 --> 01:32:08.769
And then when it goes, it's a larger balance or the dollar value of it goes up, then they might change their mind. Yeah.

1053
01:32:10.349 --> 01:32:13.555
So so but then, so to me, it's just pretty obvious

1054
01:32:14.095 --> 01:32:15.795
that, like, we still want

1055
01:32:16.175 --> 01:32:23.310
the, a low dollar amount, engageable custodial layer because we still want people to start using Bitcoin for money. Right.

1056
01:32:23.929 --> 01:32:30.590
And like the reality is that Bitcoin is not winning as much like a medium exchange right now. So we do need to make it easier for people.

1057
01:32:31.255 --> 01:32:31.755
So

1058
01:32:32.534 --> 01:32:37.835
that for the small dollar amount and for the first kind of early, part of the journey user using a solo

1059
01:32:38.534 --> 01:32:39.594
experience is, like,

1060
01:32:40.120 --> 01:32:42.620
very obvious to me that that is actually what they should do.

1061
01:32:43.080 --> 01:32:44.600
But then do we want them to be,

1062
01:32:46.120 --> 01:32:46.860
just using

1063
01:32:47.625 --> 01:32:54.605
like, the the current flavor of custodial services? Right. We have to KYC and AML, and, like, in certain certain jurisdictions, they're not allowed to use it.

1064
01:32:55.700 --> 01:33:05.805
I think I think if people are religious about the self custodial lightning, they need to be kind of, clear with themselves that that is the world that they are pushing for it. Right. That, like,

1065
01:33:06.205 --> 01:33:09.345
everyone that onboards onboards with KYC and MO,

1066
01:33:09.965 --> 01:33:10.785
and like,

1067
01:33:11.805 --> 01:33:13.105
that type of

1068
01:33:13.800 --> 01:33:16.780
not, a custodial service that doesn't preserve your privacy.

1069
01:33:17.080 --> 01:33:18.460
And I would rather

1070
01:33:19.080 --> 01:33:23.340
the first step be a custodial service because that's the economically viable thing,

1071
01:33:23.705 --> 01:33:29.085
but in it being private. And that is what eCash is to me. No. And And it's cryptographically

1072
01:33:29.465 --> 01:33:32.425
native. Graphically native. And even if it was

1073
01:33:32.950 --> 01:33:35.450
even if you had an e cash custodian

1074
01:33:36.070 --> 01:33:37.610
that was KYC AML,

1075
01:33:37.990 --> 01:33:45.095
it would still be better than the current status quo because they can't see your your your total balance and your transactions.

1076
01:33:45.955 --> 01:33:47.095
To me, it's like,

1077
01:33:47.875 --> 01:33:50.215
we live in a world where people are using custodians,

1078
01:33:51.190 --> 01:33:56.730
so let's make the custodians better. Yeah. Yeah. And it's not just a temporary thing. I mean,

1079
01:33:57.429 --> 01:33:58.409
Bitcoin transactions

1080
01:33:58.710 --> 01:34:01.955
on the l one will just always have economic costs.

1081
01:34:02.335 --> 01:34:05.235
Or do you think mempools will clear? Mpools will not clear.

1082
01:34:06.335 --> 01:34:11.239
That's okay, guys. Thank you for joining us for solo dispatch. We have Hong here.

1083
01:34:12.099 --> 01:34:13.239
I mean, I don't know

1084
01:34:14.900 --> 01:34:24.315
if you're if you imagine Bitcoin to do the thing that you want it to do, I mean, maybe not like, at some point, we will get to a point where mempool is just not clear. Yeah. That that It's an eventuality.

1085
01:34:24.615 --> 01:34:32.580
It isn't if Yeah. Bitcoin either does not work or it's an eventuality. So so, like, I I want to when when we're thinking about futures, talk about an eventuality.

1086
01:34:33.520 --> 01:34:34.660
And in that world,

1087
01:34:34.965 --> 01:34:35.364
like, it's

1088
01:34:36.804 --> 01:34:44.300
so so so there's a there's like a argument about, like, oh, we're living in a KYCML world solely we do, but, like, if it weren't, no, it

1089
01:34:44.679 --> 01:34:47.659
just is the reality that at a certain sat threshold,

1090
01:34:48.360 --> 01:34:50.620
people will just not be able to open up

1091
01:34:51.114 --> 01:34:51.855
Lightning Channels

1092
01:34:52.474 --> 01:34:59.614
and have that run us up. So like it is an economic reality in my mind, not a political reality. It is just an economic reality

1093
01:35:00.060 --> 01:35:02.560
that the small sat amount users

1094
01:35:03.020 --> 01:35:03.760
will begin

1095
01:35:04.300 --> 01:35:05.840
with custodial services

1096
01:35:06.300 --> 01:35:08.160
that take that economic

1097
01:35:09.025 --> 01:35:13.045
hurdle away from them. They take the burden. Yeah. And we want that

1098
01:35:13.345 --> 01:35:21.620
because we want Bitcoin as money to work and win for everyone, not for a small group of people. So then we're living with a custodial,

1099
01:35:22.960 --> 01:35:23.460
element,

1100
01:35:23.840 --> 01:35:27.140
not because we're lazy as Bitcoiners, but because that is the

1101
01:35:27.595 --> 01:35:33.614
the economic reality of the system that we have. Yeah. If your first experience of Bitcoin is a 10 sat zap,

1102
01:35:34.235 --> 01:35:40.710
like, it's not gonna be on with on chain Yeah. Guarantees. Yeah. It's not going to be. Yeah. And,

1103
01:35:43.305 --> 01:35:47.645
so so in that world then, like, it's also not that, like, I I am,

1104
01:35:48.025 --> 01:35:48.525
like

1105
01:35:49.070 --> 01:35:55.490
all k y c, AML, like, it's bad, and we we should live in, like, the wild west. We're here to fix this.

1106
01:35:56.270 --> 01:36:07.190
But but the thing that I believe in is that, like, we shouldn't it shouldn't be all or nothing. Right. It shouldn't be like you have to send your passport and, like, sell out your life versus, like, not being able to use anything.

1107
01:36:08.450 --> 01:36:11.030
I mean, it's this is how I feel. Like, this is,

1108
01:36:12.370 --> 01:36:25.199
in the physical world, that's often true, but in the digital world, in the same way we talk about proof of reserves, like being possible, like that thing not possible for gold, impossible for I think this is also private thing available for privacy that people have not wrapped their mind around. Like right now I go into a bar.

1109
01:36:25.580 --> 01:36:27.040
They check my driver's license.

1110
01:36:27.420 --> 01:36:31.280
What are they, what legally, what are they trying to check? They're trying to check that I am not underage.

1111
01:36:31.585 --> 01:36:36.804
Yeah. But I I just because of the form factor, I have to reveal where I live,

1112
01:36:37.344 --> 01:36:39.204
like, what my date of birth is,

1113
01:36:39.820 --> 01:36:40.320
what

1114
01:36:40.940 --> 01:36:47.280
it there's an By the way, I still give my grandfather shit that, like, it requires KYC for me to enter a bar.

1115
01:36:49.985 --> 01:36:54.885
Like, how do they not fight that? Like, that is that seems ridiculous to me. Yeah. I mean,

1116
01:36:55.264 --> 01:37:09.474
but but but at the same like like, but if we, we can society doesn't agree that we don't want underage people to be able to go into spaces where people drink. We can agree that as a society. Yeah. But but we there's a kind of a violence in the current modality of privacy. Yeah.

1117
01:37:09.935 --> 01:37:13.315
That it it kind of forces people to do the kind of an overexposure.

1118
01:37:13.775 --> 01:37:18.490
Right. And and I think modalities like e cash start to get very interesting

1119
01:37:19.110 --> 01:37:21.450
because now that we have the

1120
01:37:21.910 --> 01:37:22.390
full,

1121
01:37:23.395 --> 01:37:25.735
toolkit of digital kind of encryption and privacy

1122
01:37:26.275 --> 01:37:27.574
embedded to the assets,

1123
01:37:28.275 --> 01:37:34.969
then now we're talking we we can we can negotiate as a society. What do we want? What do we want guarantees of? Do

1124
01:37:35.350 --> 01:37:47.195
we want them to have to, like, literally reveal everything about themselves? Right. Or what is it? What is the guarantee that we want here that they're not sending to us? Or I I mean, that has problems, so I'm not advocating for that. But but, anyways,

1125
01:37:47.655 --> 01:37:50.795
that's kind of what I'm excited about in the kind of Ecash world.

1126
01:37:51.870 --> 01:38:00.050
What's up, guys? Are you are you gonna record now? Is that okay? I was waiting for you to come here before I wrapped. If you didn't show up, it wasn't gonna be proof of work.

1127
01:38:01.075 --> 01:38:02.275
Rod just walked in.

1128
01:38:02.835 --> 01:38:05.335
He's he wants to record a podcast, so we're

1129
01:38:06.515 --> 01:38:10.630
we're we're kinda we're kinda tight on time, so we're gonna wrap it here. But,

1130
01:38:12.130 --> 01:38:15.270
he doesn't have the rest of his people, so we're not gonna wrap it yet.

1131
01:38:17.105 --> 01:38:19.605
I agree. I agree. I think options.

1132
01:38:20.625 --> 01:38:26.005
I think the world we're going towards is options. I wanna give people as many options as possible.

1133
01:38:27.010 --> 01:38:32.389
I don't wanna I don't wanna pick their prescription for them. I don't wanna say this is how they should do things.

1134
01:38:32.849 --> 01:38:34.869
I want them to be able to choose

1135
01:38:35.170 --> 01:38:35.989
how they

1136
01:38:36.715 --> 01:38:37.215
interact

1137
01:38:37.675 --> 01:38:39.855
with the world, whether that's a speech,

1138
01:38:40.875 --> 01:38:48.870
perspective with something like Nostra or whether that's a financial perspective with something like Bitcoin, it should come down to options. Right? Yeah.

1139
01:38:49.330 --> 01:38:52.070
Also, like, there's a difference between privacy

1140
01:38:52.615 --> 01:38:54.395
and secrecy. I think I think the,

1141
01:38:57.175 --> 01:39:07.425
and and and really, like, privacy as, like, a right is about me having control over what I want to selectively reveal to people. It's a cyberpunk manifesto. Yeah. Yeah. Yeah. Yeah.

1142
01:39:08.065 --> 01:39:10.625
I mean, a recent book that was really great was,

1143
01:39:11.585 --> 01:39:13.764
Genesis book by Aaron Van Virdam.

1144
01:39:14.065 --> 01:39:17.380
Awesome, dude. Haven't read the book. Bought the book to support him.

1145
01:39:17.780 --> 01:39:26.120
You should read it. I mean, I I thought it was the best. I mean, we I only just buy I buy Bitcoin books. I don't read them. Yeah. Yeah. It it really lays out, like,

1146
01:39:27.445 --> 01:39:36.000
I mean, there's something a bit of, like, a purity in in what the cypherpunks were thinking about because they were thinking about it prior to a lot of the economic incentives to think about it,

1147
01:39:37.360 --> 01:39:41.060
and they were struggling with all these these issues, and I think that,

1148
01:39:43.175 --> 01:39:50.555
yeah, the articulation about privacy and secrecy and kind of like how, you know, that that also resonates with me. Anyways, so I'm excited about a world

1149
01:39:51.335 --> 01:39:51.835
because

1150
01:39:54.300 --> 01:39:58.239
they they wanted to make it a reality in the eighties nineties. Right. ECash,

1151
01:39:58.540 --> 01:39:59.680
Tommy and eCash,

1152
01:40:00.940 --> 01:40:06.545
and weren't able to do it. Why? Because it required banks to do it and dollars to do it. It required permission.

1153
01:40:07.005 --> 01:40:14.770
Yeah. The underlying you still need an asset to back it to to do this kind of issuance of notes that are private, have privacy embedded,

1154
01:40:15.150 --> 01:40:25.950
and the you didn't have the And they're bearer notes. Exactly. So you didn't have the thing to back the bearer notes, and it had to be dollars or or fiat money. And that didn't have to be banks, and then it had to be permission.

1155
01:40:26.430 --> 01:40:28.270
So so so it just was an idea that,

1156
01:40:28.670 --> 01:40:29.730
didn't really get

1157
01:40:30.270 --> 01:40:30.590
the full,

1158
01:40:32.430 --> 01:40:33.410
to live its life.

1159
01:40:34.215 --> 01:40:36.315
And now we have an alternative.

1160
01:40:36.855 --> 01:40:37.755
Now we have

1161
01:40:39.015 --> 01:40:40.315
a fully, endogenously

1162
01:40:40.615 --> 01:40:48.429
digital asset in Bitcoin for the first time that we can now use to build all these systems that we dreamed of with

1163
01:40:48.889 --> 01:41:01.350
different levels of privacy or for what people are are comfortable with or or kind of different amounts of disclosure that people are comfortable with, different entities that they're engaging with. We can give them that control and granularity.

1164
01:41:01.650 --> 01:41:05.150
It was just not possible in the prior world and and,

1165
01:41:06.690 --> 01:41:12.425
and before the conversation gets too dark, I think there's a way in which, like, the government is currently trying to,

1166
01:41:13.045 --> 01:41:15.785
bring a very blunt conversation to the privacy,

1167
01:41:16.085 --> 01:41:26.710
like digital privacy to financial privacy conversation, but it's, like, it's gonna be black or white, and it's gonna be, like, for criminals or good people. And before it becomes too black and white and we don't have

1168
01:41:27.935 --> 01:41:29.875
a chance to build our case, like,

1169
01:41:30.574 --> 01:41:37.849
I think that's why pushing eCash now is so important so that we can actually get it used for real people for the real use cases

1170
01:41:39.510 --> 01:41:40.010
and

1171
01:41:40.469 --> 01:41:42.889
kind of demonstrate this type of

1172
01:41:43.864 --> 01:41:47.485
full spectrum privacy and full spectrum kind of sovereignty

1173
01:41:48.265 --> 01:41:48.925
over that,

1174
01:41:49.864 --> 01:41:51.965
such that when we are forced to

1175
01:41:53.260 --> 01:41:56.320
negotiate as a society, like what should and shouldn't be allowed,

1176
01:41:57.420 --> 01:42:03.315
then we have a lot more to show and demonstrate and like concretely talk about because

1177
01:42:03.935 --> 01:42:12.090
the physical analogs don't work. The physical analogs is just a driver's license. You just like that, that it's black and white is the physical modality of privacy.

1178
01:42:12.470 --> 01:42:28.120
So that's the only mental model people have and to break people out of their mental model, that you just have to show them something that's different. Give them a different option. Yeah. And and when when when people are showed is only when they really question their mental model. Yeah. People are like, it's ridiculous that you're surveilling my $600

1179
01:42:28.500 --> 01:42:31.720
Venmo transactions, but they don't understand there's another option.

1180
01:42:32.265 --> 01:42:39.005
Yeah. And the and the regulations were written that way because there was no other way. Yeah. And and and and and so

1181
01:42:39.545 --> 01:42:40.364
or, like,

1182
01:42:42.250 --> 01:42:43.150
in some ways,

1183
01:42:43.849 --> 01:42:44.349
even

1184
01:42:46.010 --> 01:42:51.150
people pushing or lawsuits or, like, kind of the public discourse can't happen when there isn't an option.

1185
01:42:53.074 --> 01:42:54.855
What I mean by that is that like, okay,

1186
01:42:55.395 --> 01:43:00.375
the initial Internet was like all just public. There's no encryption, anything. There's no,

1187
01:43:03.310 --> 01:43:05.890
we didn't have discourse about whether

1188
01:43:06.430 --> 01:43:11.705
privacy is should private communication online should be a right that we have Right.

1189
01:43:12.165 --> 01:43:13.065
Until encryption

1190
01:43:13.605 --> 01:43:20.250
was actually a possibility. Right. You know, the Internet happened in the seventies, 8th and eighties, and it was gaining steam by early nineties, and

1191
01:43:21.430 --> 01:43:23.530
until it was a practical option,

1192
01:43:23.830 --> 01:43:37.570
we just didn't talk about it because why what would you talk about? Right. You know, But but once public key cryptography kind of got to a point that it could be used, then people started using it. Then then now there is a is a discussion to be had. And

1193
01:43:38.110 --> 01:43:39.330
from, like, a rights perspective,

1194
01:43:40.030 --> 01:44:13.429
of course, we have private conversations in a room, like, why shouldn't we able to have it in a in a in an online setting? Like, that makes no sense to me, but it still was a thing that we had to be fought because the way that technology progresses is usually the non private thing. Public thing happens first and the private thing comes after, and that's when you have a material thing to talk about and you have to fight for it. And so, like, in some ways, I feel there's a lot of analogy to that in in the current Bitcoin world where where, like, we we fought that for public communicate online communication, private, you know, online communication, but we didn't have to talk about financial transactions

1195
01:44:13.969 --> 01:44:15.429
Right. Because it wasn't possible.

1196
01:44:15.969 --> 01:44:18.869
It wasn't possible to have a private financial transaction

1197
01:44:19.655 --> 01:44:41.735
because Private digital trend. Yeah. Sorry. Sorry. Sorry. Yeah. Yeah. Yeah. Because we had cash. We had cash. Exactly. So it's the same thing. Like I walk into a bar. I pay cash. Exactly. No one fucking knows what the I'm doing. Exactly. And that was fine. So we have it in again, the same analogy is that we have privacy for financial tax dollars in the physical world. Just don't have it in the in the digital world. And but just the way in which we are progressing here,

1198
01:44:42.114 --> 01:44:45.500
we didn't have to have that conversation because it wasn't an option. And now that it's an

1199
01:44:46.040 --> 01:44:48.300
option, it's becoming a problem and a conversation,

1200
01:44:48.680 --> 01:44:49.180
and

1201
01:44:49.800 --> 01:44:52.780
we're discussing it. Yeah. Hong, you're a fucking legend.

1202
01:44:54.235 --> 01:44:56.175
Thank you for being a friend and an ally.

1203
01:44:57.355 --> 01:44:57.855
Freaks,

1204
01:44:59.195 --> 01:45:06.079
I wanna agree with Kieran. KYC is the illicit activity. It's not effective against criminals. They just buy

1205
01:45:07.500 --> 01:45:08.320
or steal,

1206
01:45:10.219 --> 01:45:11.199
financial credentials

1207
01:45:11.764 --> 01:45:15.545
to to get into these sites, and it it just affects regular people.

1208
01:45:16.804 --> 01:45:24.320
I wanna thank all the freaks who joined us in the live chat. You guys make this show unique and special. You guys are the true rider dies. Thank you.

1209
01:45:25.179 --> 01:45:36.105
I wanna thank everyone who supports the show. Our biggest supporters this week was 8 Myth Rendur, rider die freak with 24,000 sets. We had v with 23,000 sets, and Erza CC with 10,000 sets.

1210
01:45:37.205 --> 01:45:41.600
We're gonna have another seal dispatch on Friday with Matt Hill of start 9

1211
01:45:41.980 --> 01:45:44.560
at 1700 UTC, the usual time.

1212
01:45:45.260 --> 01:45:46.320
RHR tomorrow

1213
01:45:47.165 --> 01:45:53.264
at 1800 UTC, and I'm gonna have some guests here in the studio. Don't tell Marty he doesn't listen to dispatch,

1214
01:45:53.804 --> 01:45:57.500
so he won't expect it, But we're gonna have some great guests live

1215
01:45:58.040 --> 01:45:59.980
here in the studio at Bitcoin Park.

1216
01:46:00.520 --> 01:46:01.020
Hong,

1217
01:46:01.640 --> 01:46:03.100
this has been fucking awesome.

1218
01:46:03.885 --> 01:46:08.304
I really do appreciate you. Thanks for having me. Thank you for being a friend.

1219
01:46:10.590 --> 01:46:12.429
I feel like it's been a whirlwind. It's been,

1220
01:46:13.230 --> 01:46:15.650
me and Hong have only been French for about 6 months.

1221
01:46:16.110 --> 01:46:21.205
It was it's a good friendship. Yeah. Right? It's a good friendship. We went through a lot. Yeah. Yeah. Together.

1222
01:46:21.745 --> 01:46:23.365
Yeah. Yeah. Yeah. With Gigi.

1223
01:46:23.985 --> 01:46:24.485
Gigi,

1224
01:46:26.465 --> 01:46:28.085
fucking boss man running

1225
01:46:28.545 --> 01:46:31.700
open sets. Hong, final thoughts before we wrap.

1226
01:46:35.680 --> 01:46:36.980
Excited for the future,

1227
01:46:37.520 --> 01:46:42.055
but we have to fight for it. Like, I, I, I think the, the moment that we have to really

1228
01:46:42.435 --> 01:46:47.015
the users of the user controlled money having to be vigilant and

1229
01:46:47.715 --> 01:46:59.325
care for the whole stack from like the software to the mining, to the, to the, the, the platform that we have these conversations on the communication channels, like Novstar, to like how we make,

1230
01:47:00.025 --> 01:47:08.285
custodial financial transactions that are necessary at the onboarding stage, more private, like e cash. Like we just have to care for the whole stack. And

1231
01:47:08.670 --> 01:47:11.409
as much as the, the opportunity

1232
01:47:11.790 --> 01:47:17.730
is really big and kind of more and more real for us to be realizing these, these things, I think

1233
01:47:18.764 --> 01:47:22.065
the, the urgency of making progress before we have to

1234
01:47:23.085 --> 01:47:31.070
the resistance becomes bigger is that timeline is also shrinking. So excited for, you know, excited for all that. Excited for, I mean,

1235
01:47:31.930 --> 01:47:34.590
very thankful for what what all you do as well. Yeah.

1236
01:47:35.055 --> 01:47:35.955
Appreciate it, Hong.

1237
01:47:36.335 --> 01:47:43.475
Until next time. Let's let's try and make this a reoccurring thing. Yeah. Absolutely. That'd be awesome. Like, I mean, we said tip of the iceberg.

1238
01:47:43.990 --> 01:47:53.130
We're at the tip of the iceberg. Let's do, like, an ETF update every 6 months or something like that. Great. Yeah. For those to do that. Let's fucking go. Appreciate you freaks. Stay humble, Stack Sats.

1239
01:48:07.300 --> 01:48:10.735
I keep a close watch on this heart of mine.

1240
01:48:11.514 --> 01:48:14.975
I keep my eyes wide open all the time.

1241
01:48:15.675 --> 01:48:19.135
I keep the ends out for the tide it finds

1242
01:48:19.929 --> 01:48:21.630
because you're mine. I

1243
01:48:22.250 --> 01:48:23.230
walk the line.

1244
01:48:30.315 --> 01:48:33.695
I find it very, very easy to be true.

1245
01:48:34.555 --> 01:48:35.695
I find myself

1246
01:48:36.350 --> 01:48:38.369
alone when each day is through.

1247
01:48:38.750 --> 01:48:39.969
Yes, I'll admit

1248
01:48:40.350 --> 01:48:42.530
that I'm a fool for you

1249
01:48:42.989 --> 01:48:44.369
because you're mine.

1250
01:48:45.015 --> 01:48:46.555
I walk the line.

1251
01:48:53.655 --> 01:48:57.200
As sure as night is dark and day is light,

1252
01:48:57.900 --> 01:49:01.360
I keep you on my mind both day and night.

1253
01:49:01.980 --> 01:49:02.880
And happiness

1254
01:49:03.465 --> 01:49:05.725
I've known proves that it's right

1255
01:49:06.505 --> 01:49:07.805
because you're mine.

1256
01:49:08.425 --> 01:49:09.805
I walk the line.

1257
01:49:16.910 --> 01:49:19.915
You've got a way to keep me on your

1258
01:49:20.875 --> 01:49:24.735
side. You give me calls for love that I can't hide.

1259
01:49:25.435 --> 01:49:28.940
For you, I know I'd even try to turn the tide

1260
01:49:29.820 --> 01:49:31.120
Because you're mine,

1261
01:49:31.900 --> 01:49:33.199
I walk the line.

1262
01:49:46.530 --> 01:49:47.989
Open all the time.

1263
01:49:48.770 --> 01:49:52.390
I keep the ends out for the tide of mine.

1264
01:49:53.170 --> 01:49:54.469
Because you're mine.

1265
01:49:55.235 --> 01:49:56.775
I walk the line

1266
01:49:57.555 --> 01:49:58.775
because you're mine.

1267
01:49:59.635 --> 01:50:00.855
I walk the line.

1268
01:50:05.620 --> 01:50:06.760
I love you freaks.

1269
01:50:08.100 --> 01:50:11.640
Stay on the sax ads. I'll see you Friday well, Thursday, tomorrow,

1270
01:50:12.315 --> 01:50:15.935
if you listen to RHR. But if you don't listen to RHR, I'll see you Friday.

1271
01:50:16.235 --> 01:50:20.575
That was, I Walk the Line by Johnny Cash if you live under a fucking rock.

1272
01:50:22.030 --> 01:50:25.330
But I've been told I need to tell you guys what I play.

1273
01:50:27.310 --> 01:50:29.250
I love you all. Stay humble, and

1274
01:50:30.555 --> 01:50:33.935
if someone is gonna buy an ETF, just recommend Bitb,

1275
01:50:34.715 --> 01:50:37.973
and, otherwise, recommend self custody. Appreciate you all. Peace.