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Compromise With Banks!?🔥iTrust Capital CEO INTERVIEW · The Paul Barron Crypto Show

0:00
Speaker 1: Have we lost all clarity and trust in what's going
0:03
Speaker 1: on in DC? Right now, we're going to break it
0:04
Speaker 1: down for you guys and get into it with of
0:07
Speaker 1: course Kevin Maloney coming over from I trust I'll break
0:09
Speaker 1: all that down. It's going to be a good one today.
0:12
Speaker 1: I do want to start off though, with a clip,
0:14
Speaker 1: and this, of course is Charles Hoskinson referencing exactly his
0:20
Speaker 1: position around what's happening in DC.
0:22
Speaker 2: Take a look, all new projects are securities by default.
0:25
Speaker 2: How is that any better than what scary Gary gave
0:28
Speaker 2: us under Biden? One year later, Elizabeth Warren wrote the bill.
0:33
Speaker 3: You still got people like Brad saying, well, not perfect,
0:36
Speaker 3: but we just got to get something.
0:37
Speaker 2: You know, it's better than no clarity handed.
0:40
Speaker 3: To the same people who suit us, who subpoened us.
0:43
Speaker 3: That's better. That's what we fought for. Sorry, Brad, it's
0:47
Speaker 3: not better than chaos. Take the chaos and fight for
0:50
Speaker 3: what's right. I didn't sign up to hand the fucking
0:53
Speaker 3: revolution to fifteen banks.
0:55
Speaker 2: I signed up for freedom. Goddamn it.
0:58
Speaker 3: They've handed the revolution off so they could be part
1:01
Speaker 3: of a new oligarchy.
1:02
Speaker 2: It's not what bitcoin was built on. It's not the
1:04
Speaker 2: doctorate of setociism.
1:06
Speaker 1: So you can see mister Hoskinson not very happy there
1:10
Speaker 1: as he started to see the unraveling of what we've
1:13
Speaker 1: seen with the Clarity coming out of DC. A lot
1:16
Speaker 1: is happening. So I thought, hey, let's bring on some
1:18
Speaker 1: cleaner and more calm heads. And of course it is
1:21
Speaker 1: Kevin Maloney coming in from my trust already.
1:23
Speaker 2: Kevin good, Paul, thanks for having me. Happy New Year,
1:26
Speaker 2: Happy New Year to you.
1:28
Speaker 1: So you've got a chance to see Charles very upset
1:31
Speaker 1: right there in terms of the status of where we're
1:34
Speaker 1: dealing with Clarity, and of course rightly so I'm I
1:39
Speaker 1: dare I say I'm in a bit of Charles's camp
1:41
Speaker 1: in the sense I feel like this industry has been
1:43
Speaker 1: hijacked a little bit around what's going on when you
1:47
Speaker 1: listen to his statement and what we have seen coming
1:51
Speaker 1: out of DC and maybe even some of our own
1:54
Speaker 1: crypto proponent companies. Where do you guys stand in terms
1:57
Speaker 1: of what's happening right now?
2:00
Speaker 4: Yeah, I mean, Paul, good question. You know, I don't
2:03
Speaker 4: blame the sentiments out there. I see a spectrum of those,
2:07
Speaker 4: you know, from A to Z, there's a lot of
2:09
Speaker 4: different temperaments, talents and convictions involved across the board. You know,
2:15
Speaker 4: I just capital we want to see something go through.
2:19
Speaker 4: I want to see something go through. I think it
2:21
Speaker 4: benefits the masses if we do get a bit more clarity,
2:25
Speaker 4: you know. And you guys know, the House passed his
2:26
Speaker 4: version July twenty fifth. The Senate Banking Committee, you know,
2:29
Speaker 4: had a heavily revised and mended two hundred and seventy
2:32
Speaker 4: eight page draft that came back on the twelfth of January.
2:36
Speaker 4: There was a markup session. People were asking for more time.
2:40
Speaker 4: You know, there's no new dates that there's bipartisan talks
2:44
Speaker 4: happening behind the scenes, even over the weekend. I'm told
2:46
Speaker 4: that it's happening daily. We just hosted Congressman Brian Style
2:51
Speaker 4: here a few weeks ago for lunch on Friday, and
2:54
Speaker 4: he had high confidence and high conviction that something would
2:58
Speaker 4: go through. Personally, I'm a little bit concerned when when
3:02
Speaker 4: I see, you know, Brian Armstrong come out and say, hey,
3:05
Speaker 4: I'm gonna witch all support, as he sort of threatened
3:08
Speaker 4: or did on the fourteenth, you know, hours before the markup.
3:11
Speaker 4: I think Brian obviously doesn't represent the whole industry. But
3:15
Speaker 4: you know, he's got some passion for hopefully doing the
3:18
Speaker 4: right thing and hopefully that that's going to benefit most
3:21
Speaker 4: of the masses. You know, it's a little frustrating the
3:24
Speaker 4: banks relate to the game. They need to stay relevant.
3:27
Speaker 4: They're behind the eight ball. They haven't innovated. They've denied, denied,
3:32
Speaker 4: denied the crypto space for years. I mean, we personally
3:36
Speaker 4: got debanked earlier this year from a large bank massive
3:39
Speaker 4: bank rhymes with ACE, starts with the C, but I
3:44
Speaker 4: don't want to name it. And for no reason, we
3:47
Speaker 4: literally couldn't get any reason that we were that we
3:51
Speaker 4: were de banked as a company. Our corporate account, which
3:55
Speaker 4: has no crypto activity in it at all.
3:57
Speaker 2: It's literally just our own corporate dollars.
4:00
Speaker 4: I am hopeful that we'll get to a resolution that
4:04
Speaker 4: will have some benefit. You know, my attorney says that
4:09
Speaker 4: when you have a good settlement in a lawsuit, it's
4:12
Speaker 4: like both sides feel just slightly screwed, and so I'm
4:16
Speaker 4: hoping that we get better than that than that feeling
4:19
Speaker 4: of a settlement here. I think the banks have a
4:22
Speaker 4: very strong lobby, Let's be honest. They haven't innovative, As
4:26
Speaker 4: I mentioned, so now they want to control the entire process,
4:28
Speaker 4: and we'll.
4:29
Speaker 2: See what happens.
4:30
Speaker 4: I'm hoping that, you know, this latest draft allows for
4:34
Speaker 4: some active participation and that we get you know that
4:39
Speaker 4: there's some liquidity provision and not passive holding with with
4:42
Speaker 4: no benefit. There's got to be some benefit for the
4:46
Speaker 4: for the for the you know, stable corn holders.
4:48
Speaker 2: Yeah, there has to be.
4:49
Speaker 1: I think that, Well, that's just one of obviously protecting
4:52
Speaker 1: DeFi is another big category that has been restructured in
4:56
Speaker 1: the markup, along with just privacy in general. I think
4:59
Speaker 1: that the challenge that a lot of Americans are really
5:02
Speaker 1: miffed about. Let me play another clip for you. This
5:04
Speaker 1: is John Deaton, who falls on the side. I was
5:08
Speaker 1: surprised at this clip as well. It's probably an antithesis
5:11
Speaker 1: of what Charles was talking about. But take a look
5:14
Speaker 1: at what John said.
5:15
Speaker 5: You know, when I look at the bill, I think
5:18
Speaker 5: a bill. I agree with Brad garling House. Let's not
5:20
Speaker 5: let perfection get in the way of good because once
5:23
Speaker 5: you leave the table and these midterm elections and there
5:26
Speaker 5: could be a macro event. It could be with Iran,
5:29
Speaker 5: everyone's attention turns to that the Democrats take control and
5:33
Speaker 5: Elizabeth Warren becomes the chairwoman of the Banking Committee, which
5:37
Speaker 5: she would be, which is going to go back if
5:39
Speaker 5: the SEC has all the control and we're arguing over
5:43
Speaker 5: tokenized securities and so time is of the essence. And
5:47
Speaker 5: I think that if they're not talking about marking that
5:51
Speaker 5: up in the next few weeks, I'm going to go
5:53
Speaker 5: from cautiously optimistic to it ain't gonna happen. Yeah, and
5:58
Speaker 5: won't Charles Hodgkinson on it.
6:01
Speaker 1: All right, So when you look at that, where do
6:03
Speaker 1: you officially stand? Would you say there's no middle ground?
6:06
Speaker 2: Yeah?
6:07
Speaker 4: I mean there's got to be a middle ground. As
6:09
Speaker 4: much as I obviously pro crypto all day long, we
6:13
Speaker 4: need to have you know, we need to get the
6:17
Speaker 4: large traditional financial institutions kind of on board or on
6:21
Speaker 4: their way to getting on board. This bill is not
6:25
Speaker 4: going to be perfect. I think there there's probably going
6:28
Speaker 4: to be some middle ground. Will probably have to give
6:30
Speaker 4: up a few things. I don't think we should budge
6:33
Speaker 4: much on token ban, on token ized assets, you know,
6:37
Speaker 4: you know, things like that your rewards not getting paid
6:41
Speaker 4: out to stable corn holders. I think we need to
6:43
Speaker 4: hold our ground there. I think there's going to be
6:45
Speaker 4: a middle ground, start the ball rolling, the banks can
6:48
Speaker 4: learn and grow and connect with the industry. We can
6:50
Speaker 4: start maybe getting some more congruency in the industry, and
6:54
Speaker 4: then we can keep educating them. And maybe this is
6:57
Speaker 4: a bit hopeful, and I don't want to, you know,
6:59
Speaker 4: sit here with a lot of hope opium on your show.
7:00
Speaker 2: But maybe with once.
7:04
Speaker 4: We get the ball rolling, we can get the right
7:06
Speaker 4: people in the right seats on the bus, get the
7:08
Speaker 4: bus moving, and get the wrong people off the bus,
7:10
Speaker 4: and make changes that can further benefit the industry. But
7:13
Speaker 4: a complete stop and walking away I think sets us back,
7:18
Speaker 4: and especially going into midterms, I'm fearful that.
7:21
Speaker 2: We could lose some seats and then lose the momentum.
7:24
Speaker 1: Well, I'm in agree with that. I don't like the
7:26
Speaker 1: idea of a complete stop. Obviously, I'm in the position
7:28
Speaker 1: where I think what we've seen coming out of coinbase.
7:31
Speaker 1: We had gray Wall on last week and they were
7:35
Speaker 1: looking very positive in the sense that yes, there was
7:37
Speaker 1: still going to be another return to the table. But
7:41
Speaker 1: it's interesting too because you said securing tokenized security, so
7:44
Speaker 1: that means that it would lean more toward bank compromises
7:50
Speaker 1: versus brokerage compromises like what Securitized and Blackrock have kind
7:54
Speaker 1: of said.
7:55
Speaker 3: Yeah.
7:56
Speaker 2: I mean, look today even there was some announcements.
7:58
Speaker 4: I don't know if you saw this morning, but NYC
8:02
Speaker 4: and NASDAC several weeks ago both filed for extensions with
8:06
Speaker 4: the SEC to extend market hours.
8:08
Speaker 2: That's a good sign.
8:10
Speaker 4: I think that they're they're trying to compete with crypto,
8:12
Speaker 4: which is twenty four seven three sixty.
8:14
Speaker 2: Five, right. So we saw that.
8:16
Speaker 4: We also saw that that the NA season contemplating that
8:21
Speaker 4: tokenized assets will become more ubiquitous second half of this year,
8:25
Speaker 4: and so I think it's coming. I think we can't
8:28
Speaker 4: deny it. I think we want transparency and compliance around it.
8:31
Speaker 4: That part I'm fine with. And the KYC KYB is
8:35
Speaker 4: not going away. We need to know who the customers are.
8:38
Speaker 1: Well, speaking of brokerages, here is Cody coming in from
8:42
Speaker 1: the Digital Chamber talking about the idea of either coinbase
8:47
Speaker 1: or really the brokerage side, which is more Blackrock. Take
8:50
Speaker 1: a look what he had to say.
8:52
Speaker 2: I agree with Carlos.
8:53
Speaker 4: I think that the way that Brian was reading this
8:56
Speaker 4: bill is or his lawyers were telling him of how
8:59
Speaker 4: this bill would impact or ban tokenized equities.
9:02
Speaker 2: Is just false. I'm not sure you know where coinbase
9:06
Speaker 2: was getting that.
9:07
Speaker 4: Carlos Domingo, who is the CEO of securitized when is
9:10
Speaker 4: saying coinbases fears here.
9:12
Speaker 2: Are kind of a little bit overblown. I want to
9:14
Speaker 2: get your reaction.
9:15
Speaker 6: To that best case. Some folks have said, this doesn't
9:17
Speaker 6: do anything, it's not even necessary. From our perspective, it
9:21
Speaker 6: had the potential to shut down exemptive authority that is
9:24
Speaker 6: a pillar of sec authority, and to undo that pillar
9:28
Speaker 6: was a dangerous, dangerous president. Even if it was only
9:31
Speaker 6: one vote in one committee that no matter what, that
9:34
Speaker 6: was not the intent. The intent was not to eliminate
9:38
Speaker 6: exemptive authority. The whole point of crypto is to do
9:41
Speaker 6: things like atomistic settlement. If the existing rules worked, we
9:44
Speaker 6: would have been able to register and to have new
9:48
Speaker 6: origination and have a proliferation all of all these great
9:50
Speaker 6: new Web three projects. Instead, we're in this position right
9:53
Speaker 6: now where things like books and records or clearing agencies,
9:58
Speaker 6: we haven't been able to move forward on some of
10:00
Speaker 6: those things because they are technological and the previous administration
10:04
Speaker 6: didn't want to use their exemptive authority to do that.
10:07
Speaker 6: If you have to write rules that look exactly like
10:09
Speaker 6: the old rules.
10:10
Speaker 2: What's the point.
10:11
Speaker 6: But we couldn't let a bill that had I think,
10:14
Speaker 6: serious problems get to the next step without fixing some
10:17
Speaker 6: of those very serious red lines.
10:20
Speaker 1: So that was confusing to me because that was obviously
10:22
Speaker 1: coinbase countering. What Cody was saying is that it wasn't
10:26
Speaker 1: really a big deal, but in reality it was a
10:28
Speaker 1: big deal around the exemptive authority and getting into that position.
10:32
Speaker 1: Then you had Brian Armstrong come on with AX. He says, hey,
10:36
Speaker 1: we didn't get pushed away. Actually, the White House has
10:39
Speaker 1: been super constructive here the White House, they did ask
10:43
Speaker 1: us if we can figure out a deal with the banks.
10:45
Speaker 1: That's typical Trump fashion, even though he will tried a
10:48
Speaker 1: strong arm every once in a while. We were watching
10:51
Speaker 1: that right now. But from a negotiation standpoint, you think
10:58
Speaker 1: about it, do you think we got the right pieceeople
11:00
Speaker 1: in charge. I was looking up on your Twitter account.
11:02
Speaker 1: I saw you with beau Hinz here and I was like,
11:05
Speaker 1: bo did a pretty good job. He got genius act
11:08
Speaker 1: across the line, and I think it worked in favor
11:12
Speaker 1: of the industry, maybe so much so that it put
11:14
Speaker 1: the banks a little bit on their heels. Do you
11:18
Speaker 1: think we have the right people in the crypto side
11:21
Speaker 1: of White House right now? Because Patrick Witt seems to
11:24
Speaker 1: be dealing on both sides of the deck here.
11:27
Speaker 2: Yeah.
11:27
Speaker 4: I mean, you know, Bo's phenomenally He's right, young kid. Unfortunately,
11:32
Speaker 4: they just don't pay a lot to be involved with
11:34
Speaker 4: politics at an early age. Most people come later on
11:36
Speaker 4: after didn't make a ton of money. And I know
11:38
Speaker 4: his dad's pretty successful. But you know, to Bo's defense,
11:41
Speaker 4: he wanted to go, you know, get into private industry
11:43
Speaker 4: and make some money and he and he deserves the
11:46
Speaker 4: right to do that. David Sachs is a bright guy.
11:49
Speaker 4: I haven't met Witch, but I know that their intentions
11:51
Speaker 4: are good. Bo and David combined, I think we're just
11:55
Speaker 4: a force to be reckoned with. They're doing a great
11:57
Speaker 4: job of educating people. I think they did move the
12:00
Speaker 4: ball quickly. I think the attitude of hey, the train
12:02
Speaker 4: is leaving the station. Big things are happening. Banks, you
12:05
Speaker 4: want to get on board or not, because we're going
12:08
Speaker 4: this way no matter what, and I think the banks
12:11
Speaker 4: got nervous. I think trad five is going to start
12:14
Speaker 4: to participate in the blockchain economy. In a big way
12:16
Speaker 4: in the next six to thirty months, you know, And
12:18
Speaker 4: when Brian pulled support for the current Senate draft and
12:21
Speaker 4: you said there's too many issues on summarizing its material
12:24
Speaker 4: worse than status quo and prefers no bill over a
12:27
Speaker 4: bad bill, but open to fixes. You know, I think
12:30
Speaker 4: that's a big voice. And you got to have that
12:33
Speaker 4: and be like, you know, what does that mean. Hey,
12:34
Speaker 4: let's let's figure out a way to play ball. I
12:36
Speaker 4: like that the White House reached out and said, hey,
12:38
Speaker 4: can you help us? Can you help us work with
12:41
Speaker 4: the banks to get something? You know, and if you
12:43
Speaker 4: look at Robin Hood's position, you know, the vlad tent
12:45
Speaker 4: of you know, he agrees that there's still plenty of
12:49
Speaker 4: work to be done, but you know he.
12:51
Speaker 2: Sees a path and they're here to help.
12:53
Speaker 4: So and he's more on the broker dealer side, right
12:56
Speaker 4: He's dealing with traditional securities getting ready for token ized
12:59
Speaker 4: asset and not doing as much in you know, spot
13:02
Speaker 4: crypto or in our case, retirement crypto as I think
13:05
Speaker 4: they need to be. But you know, they're highlighting how
13:08
Speaker 4: the regulatory uncertaintly blocked staking and tokenized you know stocks
13:12
Speaker 4: in the US, and and that has implications, you know,
13:15
Speaker 4: that has implications for US. We offer you know, staking,
13:18
Speaker 4: we offer crypto in the iras long term, you know,
13:22
Speaker 4: you know, retirement outlook for working professionals across America. And
13:26
Speaker 4: I know that these professionals are going to want to
13:28
Speaker 4: participate in ETFs and other tokenized funds and tokenized assets
13:33
Speaker 4: and put those in their crypto IRA accounts. And they
13:36
Speaker 4: should be able to do that. But don't enterestimate the
13:39
Speaker 4: bank's lobby. They are strong and powerful. My prediction is
13:43
Speaker 4: a top ten or fifteen bank in the next three
13:45
Speaker 4: to five years will not make it because they didn't innovate.
13:49
Speaker 4: They denied that this economy and this arena existed, and they.
13:54
Speaker 2: Thought everything related to crypto.
13:56
Speaker 4: Some you know, one or two of the top twenty
13:58
Speaker 4: banks just head in the sand, want nothing to do
14:02
Speaker 4: with it.
14:03
Speaker 2: It's not going to be around forever, and they continue
14:06
Speaker 2: to deny.
14:06
Speaker 4: What we've found is now a few of the top
14:09
Speaker 4: banks have reached out and said, hey, can we do
14:11
Speaker 4: a masterclass with you guys on what's unique, better and
14:14
Speaker 4: different about your approach, how we can understand the flow
14:19
Speaker 4: of funds, compliance, transparency, KYC Tokenized assets, crypto retirement accounts.
14:25
Speaker 2: How we can.
14:26
Speaker 4: Serve the masses and allow them to make self directed
14:29
Speaker 4: decisions with good tools, resources and access to educational tools
14:35
Speaker 4: that will help them make good decisions. And we're sitting
14:37
Speaker 4: here saying, look, we can help educate the large traditional
14:41
Speaker 4: financial companies about what the working professionals across America want.
14:46
Speaker 4: I know that there's more than crypto curious participation from
14:50
Speaker 4: the banks. I know they're trying to get a bit
14:53
Speaker 4: of a land grab and keep more than they probably
14:55
Speaker 4: will get. I'm sure there's going to be some compromise,
14:57
Speaker 4: but again, we need to hold our ground.
15:00
Speaker 2: On some of these items.
15:01
Speaker 4: But we need to get the ball rolling, get tradfy
15:03
Speaker 4: in before the midterms. We can educate them and help
15:07
Speaker 4: them grow along the way, and I think there will
15:09
Speaker 4: be more changes down the road that will ultimately benefit
15:12
Speaker 4: this whole economy, the blockchain economy.
15:14
Speaker 1: Further on, he came in right out here in the front,
15:17
Speaker 1: say hey, dear banks, now's a good time for you
15:19
Speaker 1: to take a big deal.
15:20
Speaker 2: It just seems like this was.
15:23
Speaker 1: And it also I think put most of the industry
15:26
Speaker 1: against coinbase, and if anything, now you've divided and conquered.
15:32
Speaker 1: This may be the perfect thing for the banks. Would
15:35
Speaker 1: you have negotiated this deal a little differently.
15:39
Speaker 4: If I was Brian Armstrong Coinbase, I probably would have
15:42
Speaker 4: waited a couple of weeks until I got more of
15:44
Speaker 4: the Clarity Act through on that announcement where they were
15:46
Speaker 4: basically taking over all banking, all brokerage, all crypto, all payments,
15:52
Speaker 4: all everything activity right. I don't know if you saw that,
15:56
Speaker 4: the prodigious announcement, but it was incredible and amazing and
16:02
Speaker 4: it's needed. I think that and his powerful stance can
16:07
Speaker 4: be intimidating to some of the banks. It's just my
16:09
Speaker 4: personal opinion, but I've I've met with Coinbase, I've met
16:13
Speaker 4: with Brian multiple times. They are sharp, they are focused,
16:16
Speaker 4: they want to deliver value. They are dominating, and they
16:19
Speaker 4: don't want to wait for the bank the banks to
16:22
Speaker 4: jump on board, get on board, the train's leaving. I'm
16:24
Speaker 4: in a different position because I trust Capital much smaller.
16:27
Speaker 4: We need to work with really good banks. We want
16:30
Speaker 4: them to get up to speed. I don't want them
16:32
Speaker 4: to have all the power. I do think rewards should
16:35
Speaker 4: be able to get paid out clear rules. In our opinion,
16:38
Speaker 4: boost you know investor confidence and helps us grow you know,
16:42
Speaker 4: retirement accounts. And when the banks participate, that's like Kannheiser
16:45
Speaker 4: Busch launching a new beer and we have an amazing
16:49
Speaker 4: cult like following with a delicious craft beer, and when
16:52
Speaker 4: they go market the beer, we just get more beer sales.
16:55
Speaker 2: I'm using obviously an adult.
16:56
Speaker 4: Beverage analogy, but like we want bigger, you know, better
17:01
Speaker 4: participants to come in because it opens the pool for
17:04
Speaker 4: a lot more participants. We do a better job at
17:06
Speaker 4: servicing and converting. But I do think that the clear
17:11
Speaker 4: rules are needed. The banks potentially want to issue their
17:15
Speaker 4: own stable coins, manage the capital behind those right and
17:20
Speaker 4: then decide if and when they want to pay out
17:23
Speaker 4: the return, the reward or the yield on that. Think
17:25
Speaker 4: about that right now. There's four different layers. You've got
17:27
Speaker 4: Circle who issue the us DC stable coin. They use
17:31
Speaker 4: black Rock that's managing the dollars held in the US
17:35
Speaker 4: one to one behind each stable coin. Black Rock makes
17:38
Speaker 4: a return, they manage it short term commercial paper money
17:41
Speaker 4: markets things like that. Coinbase will bring in individuals like
17:44
Speaker 4: me and I'll have a little bit sitting in my account.
17:46
Speaker 4: I'll get a little bit of reward for being a
17:48
Speaker 4: member of participating or a certain engagement on their platform,
17:52
Speaker 4: and there's multiple parties involved there. I can see how
17:55
Speaker 4: and why the banks potentially would like to.
17:58
Speaker 2: Issue stable coins.
18:00
Speaker 4: The manager of the capital held one to one US
18:02
Speaker 4: dollars in the US behind the stable coin. Keep all
18:05
Speaker 4: of those fees, right, keep all of the delta on
18:09
Speaker 4: what they pay out for a bit of small savings account.
18:12
Speaker 4: And that hurts you know, I just capital are our clients,
18:17
Speaker 4: and it hurts coinbase and all the other loge exchanges.
18:20
Speaker 4: I don't think the banks should be able to control
18:21
Speaker 4: that whole process. They didn't innovate.
18:23
Speaker 2: They need to innovate or some of them are going
18:25
Speaker 2: to die well.
18:26
Speaker 1: And you're also starting to leverage against DeFi, which is
18:29
Speaker 1: a real concern. My concern is, does does Coinbase end
18:33
Speaker 1: up letting some of the benefits of protecting DeFi fall
18:37
Speaker 1: under the knife in this negotiation because they're going to
18:40
Speaker 1: be one of the lead negotiators here. In general, I.
18:43
Speaker 4: Think I think we would love to see it go
18:47
Speaker 4: through in its earlier forms, where there was more protections
18:50
Speaker 4: and more.
18:51
Speaker 2: Protection for for you know, for DeFi, but.
18:54
Speaker 4: I understand for the masses to participate and for these
18:57
Speaker 4: things to move. You've got to remember trillions will flow
19:00
Speaker 4: in when the banks get on board through four to
19:03
Speaker 4: one k's, through registered investment advisors that control over one
19:08
Speaker 4: hundred trillion. Four to one k's is more than ten
19:11
Speaker 4: trillion cryptoiras we're talking about, but there's thirteen to fifteen
19:14
Speaker 4: trillion at iras. There's tons of cash sitting on the sidelines,
19:18
Speaker 4: and so I think there's going to be a lot
19:21
Speaker 4: more participants. Trillions of dollars will flow pension plans and
19:24
Speaker 4: downmans foundations. They'll start allocating if we just get a
19:28
Speaker 4: four to five percent allocation into crypto, like ba A
19:31
Speaker 4: came out and publicly stated four percent allocation. Our advisors
19:36
Speaker 4: are now recommending into crypto that came out. I think
19:40
Speaker 4: it was January fifth this year. They announced it in December,
19:42
Speaker 4: but they're live with it. That moves the needle. So
19:46
Speaker 4: we need to get the large banks involved to some capacity.
19:51
Speaker 4: We should hold our ground on some things. I think
19:53
Speaker 4: there's going to be a bit of a compromise. I
19:54
Speaker 4: don't know if we're gonna be able to hold our
19:56
Speaker 4: ground on everything, DeFi and I do think ultimately long
20:00
Speaker 4: term it benefits most of us in the crypto arena.
20:03
Speaker 1: You keep mentioning retail there because this, to me is
20:06
Speaker 1: one of the pivotal points. I mean, we're talking about
20:10
Speaker 1: the United States alone representing over two hundred million in
20:16
Speaker 1: millennials or gen z. Those are investors, and eventually we'll
20:20
Speaker 1: become the investors less than one hundred of million I
20:24
Speaker 1: believe now in the boomer class. So it is clear
20:27
Speaker 1: that the guard has passed, and that kind of audience
20:32
Speaker 1: is a different audience than I think what the banks
20:34
Speaker 1: and even to a certain extent of what the institutions
20:37
Speaker 1: have been dealing with. So maybe that's why we're seeing
20:40
Speaker 1: such a pushback here. I want to play a clip
20:44
Speaker 1: from Wyndyoh. She was talking about retail being ignored, and
20:47
Speaker 1: I want to get your opinion.
20:48
Speaker 2: Take a look.
20:49
Speaker 7: White House is considering pulling it support for crypto market
20:52
Speaker 7: structure bill entirely of coinbases not come back to the
20:55
Speaker 7: table with a yield agreement that satisfies the banks and
20:57
Speaker 7: it gets everyone a deal. This is President Trump bill,
21:00
Speaker 7: and at the end of the day, not Brian Armstrong.
21:02
Speaker 7: I came out and I said I fully support coinbase.
21:04
Speaker 7: Eric Vorhiz I fully support Coinbase. Actually, we've been cooking
21:07
Speaker 7: up some good ideas and how we can help the
21:10
Speaker 7: community banks specifically in this bill. This absolutely sounds terrible.
21:14
Speaker 7: The yield agreement that satisfies the banks. We don't care
21:18
Speaker 7: about the banks. What do you mean community banks that
21:21
Speaker 7: take advantage of the working class that anytime they get
21:24
Speaker 7: into a little bit of trouble we bail them out.
21:26
Speaker 7: We don't get bailed out. Nobody the bank will take
21:29
Speaker 7: their house. No, this is about retail. This is about
21:32
Speaker 7: people who have absolutely had it with the current traditional
21:36
Speaker 7: financial system and we're done. We've been done. I support
21:39
Speaker 7: Brian Armstrong and I support coinbase to an extent, but
21:43
Speaker 7: I don't trust them. I don't trust these people in
21:46
Speaker 7: power that have lost the plot because it should be
21:48
Speaker 7: about retail. But again, nobody cares about retail.
21:51
Speaker 1: So nobody cares about retail. You can kind of get
21:53
Speaker 1: the point there, and the frustration coming in from what
21:55
Speaker 1: has been a very large audience. We see it in
21:58
Speaker 1: our comments, and we're seeing right now, Kevin a sway
22:03
Speaker 1: in the amount of people that are not for this
22:07
Speaker 1: kind of thing. It appears that we are dealing with
22:11
Speaker 1: what Larry Fink claims is capitalism is losing public trust
22:16
Speaker 1: and must evolve. You know, this was a tweet that
22:19
Speaker 1: he put out.
22:21
Speaker 2: I thought that right.
22:22
Speaker 1: There kind of says one thing, and that is that
22:26
Speaker 1: you're right. A lot of people have lost the plot here,
22:28
Speaker 1: and it does put a position in. It may also
22:31
Speaker 1: why you see why you're seeing such growth in Robinhood,
22:34
Speaker 1: which has been kind of the little man, you know,
22:38
Speaker 1: it's the average retail investor.
22:40
Speaker 2: I think we're in a shift here.
22:42
Speaker 1: I think we're in a shift. Man. This is a
22:44
Speaker 1: dangerous wire that we are walking right now.
22:47
Speaker 2: Yeah. I mean, Robin has done a phenomenal job. Their
22:49
Speaker 2: stock was up forty percent last year. I was a
22:51
Speaker 2: small investor.
22:52
Speaker 4: And I'm not pushing any stock, but I was really
22:55
Speaker 4: pleased with their ability to innovate and just and deliver
23:01
Speaker 4: value across the board.
23:02
Speaker 2: They're dealing with millions of small accounts. You know.
23:05
Speaker 4: The transfer of wealth that's happening in this country over
23:08
Speaker 4: the next five to ten years to the tune of
23:10
Speaker 4: forty to sixty trillion dollars in wealth is being passed
23:14
Speaker 4: down from one generation to the next over the next
23:16
Speaker 4: five to ten years. These people are growing up in
23:19
Speaker 4: the digital age they're growing up in the blockchain economy
23:22
Speaker 4: is the norm, and they may not even want to
23:27
Speaker 4: deal with their large, well known, incumbent one hundred year
23:31
Speaker 4: old banks. They're not They don't know crypto. They don't
23:35
Speaker 4: know how to service it, they don't know how to
23:36
Speaker 4: sell it, they don't know how to understand it.
23:38
Speaker 2: They really just don't know it, and so they need lots.
23:43
Speaker 4: Of cult like craft beer, with the right kind of
23:46
Speaker 4: following of people that they can deliver value to. They
23:50
Speaker 4: don't understand it. And so even if they get more
23:53
Speaker 4: of what they want or more of what they think
23:56
Speaker 4: we all think they deserve on this bill, if there's
23:59
Speaker 4: some sort of concessions happening, they have to still be
24:03
Speaker 4: careful because they don't have the authentic connection to the
24:07
Speaker 4: blockchain arena. They literally debanked people like me and my
24:11
Speaker 4: company this year and now they're amazing, and I'm going
24:15
Speaker 4: to stay with them and do great things and give
24:17
Speaker 4: them everything I have.
24:19
Speaker 2: No, that's not gonna happen.
24:20
Speaker 4: They're gonna have to earn the trust of the industry
24:23
Speaker 4: and they have to get up to speed.
24:25
Speaker 2: There's so many nuances with crypto.
24:28
Speaker 4: We get it all the time we enter two thousand
24:30
Speaker 4: calls a day with live people in the US, just
24:34
Speaker 4: removing barriers.
24:35
Speaker 2: For our clients.
24:36
Speaker 4: And if you don't do that well at scale with
24:38
Speaker 4: a smile and professionalism and remove those barriers, it takes
24:44
Speaker 4: years to years to build that authentic approach to delivering
24:48
Speaker 4: that kind of value and service for our client base.
24:50
Speaker 4: The banks aren't going to flip a switch to the
24:53
Speaker 4: younger generation that's going to transfer that wealth and expect
24:57
Speaker 4: all of them to stay. Most of them are still
24:59
Speaker 4: going to go chase the relationships with you know, of
25:04
Speaker 4: Vlad and Brian at their entities and not stay with
25:07
Speaker 4: the banks because the banks are just too late.
25:09
Speaker 1: Well, and the point you're getting at, I mean the
25:11
Speaker 1: consequences here of screwing over retail, that's the point you're
25:15
Speaker 1: getting at. This is a huge maybe line in the
25:18
Speaker 1: sand that maybe never even gets to the point of
25:21
Speaker 1: where banks can innovate. Back to your prediction of possibly
25:24
Speaker 1: a major bank failing in just the next few years.
25:26
Speaker 1: So I'm going because they.
25:28
Speaker 4: Didn't get into crypto, you know, sorry to cut you
25:30
Speaker 4: off literally, because they didn't get into crypto. And we've
25:34
Speaker 4: we've spoken in three to five really good ones that
25:36
Speaker 4: are like, yeah, we're in.
25:37
Speaker 2: We're developing behind the scenes.
25:38
Speaker 4: We're lading for a little bit more regulatory clarity, and
25:41
Speaker 4: we've spoken to a few that said, nope, we want
25:44
Speaker 4: nothing to do with it. Everyone's this is still the
25:46
Speaker 4: wild wild West of twenty seventeen, eighteen or two thousand,
25:50
Speaker 4: you know, twenty one twenty two time frame.
25:52
Speaker 1: Well, last a couple last questions here before I let
25:55
Speaker 1: you go. Clarity Act provisions most benefit to I Trust
25:59
Speaker 1: Capital customers.
26:01
Speaker 4: I think if we get the right kind of clarity
26:03
Speaker 4: on stable coins, I think that'll be huge.
26:05
Speaker 2: We we are launching us d C. We are ready
26:08
Speaker 2: to go.
26:09
Speaker 4: Our clients are asking for yield, and we want to
26:12
Speaker 4: provide that we have billions in crypto assets, hundreds of
26:15
Speaker 4: millions in cash, hundreds of millions in precious metals.
26:18
Speaker 2: And we want our clients to you know, we're not
26:21
Speaker 2: just a little CRYPTOIRA platform.
26:23
Speaker 4: We want them to view us as a destination platform
26:26
Speaker 4: where they can get involved with staking and lending and
26:29
Speaker 4: and yield generation on BTC us d C, and we're
26:33
Speaker 4: you know, looking at opportunities, viable compliant opportunities for for
26:38
Speaker 4: XRP and others that people are asking for so yeah,
26:41
Speaker 4: for us, you know, we love working with the regulators.
26:44
Speaker 4: I had the SEC at my office hester Purs was here.
26:47
Speaker 4: You know, she left some meetings down the road here
26:50
Speaker 4: in Orange County. I'm in Irvine, California, and stop by
26:53
Speaker 4: for a couple hours, and we see her at conferences.
26:56
Speaker 4: And you know, they don't even regulate US, I mean
27:00
Speaker 4: or state chartered bank regulated trust company. We just filed
27:04
Speaker 4: a for mate EV, so that should get approved soon
27:06
Speaker 4: with the SEC, but they don't regulate it. From a
27:09
Speaker 4: CRYPTOIRA perspective, that's actually more of the IRS and the
27:12
Speaker 4: IRS is here for an audit. So we're very transparent
27:15
Speaker 4: about our approach. We like working with the regulators. We
27:18
Speaker 4: just want a reasonable approach and we're looking for Just
27:22
Speaker 4: give us the guidance, you know, let's put up the guardrails,
27:25
Speaker 4: give us the guidance, tell us what the speed limit is,
27:27
Speaker 4: and we go work quickly to make sure that everyone
27:31
Speaker 4: in our industry is holding each other accountable. But the
27:33
Speaker 4: USDC standle cooin things a big deal. Yield generation is
27:37
Speaker 4: a big deal second half of the year for us
27:39
Speaker 4: RWA real world assets, whether it's real estate or traditional
27:43
Speaker 4: tokenized assets.
27:44
Speaker 2: I think that's going to be interesting and you can.
27:46
Speaker 4: Hold all of that in your IRA as long as
27:49
Speaker 4: the third party custodian does that work for you, and
27:52
Speaker 4: as long as it's not art or collectible.
27:55
Speaker 2: So we were.
27:56
Speaker 4: Patiently waiting for some of this, you know, for the
28:00
Speaker 4: how Senate reconciliation, there's still a bit needed. I like
28:03
Speaker 4: that Brian's holding a strong voice for the industry. He
28:08
Speaker 4: has a lot to gain from this personally and professionally.
28:11
Speaker 4: In the company, there's no doubt, but we will benefit
28:15
Speaker 4: if we can hold the line. But again, I do
28:17
Speaker 4: believe there's going to be some concessions and compromises to
28:20
Speaker 4: get the banks in. And I'm hoping that once we
28:23
Speaker 4: get this thing going, like I said, get the bus
28:25
Speaker 4: going like Jim Collins built the last are good to great,
28:28
Speaker 4: get the bus moving, get the wrong people off the bus,
28:31
Speaker 4: get the right people in the right seats, and then
28:33
Speaker 4: we figure out how to continue to add value. But
28:35
Speaker 4: get the bus rolling. Right now, the bus rolling for
28:39
Speaker 4: traditional finance, and I think trillions will start flowing in
28:43
Speaker 4: once we get a little bit more clarity, because right
28:45
Speaker 4: now they don't want to risk, they don't want to
28:47
Speaker 4: risk brand or reputation on getting into crypto and they're
28:52
Speaker 4: looking for what's in it for me?
28:54
Speaker 2: Right?
28:55
Speaker 1: Yeah? Do you think that the banks and the I
28:59
Speaker 1: will say anti Clarity Act in its current role, really
29:03
Speaker 1: understand that this would be a handout to you know,
29:07
Speaker 1: projects like Solana, which are one of the biggest in
29:09
Speaker 1: terms of token is securities globally that's operating outside of
29:13
Speaker 1: the Clarity Act right now. If Clarity Act doesn't go through,
29:16
Speaker 1: Solana is going to be a monster winner here. Do
29:19
Speaker 1: you think they understand that?
29:19
Speaker 2: Yeah?
29:21
Speaker 4: Yeah, I think that they need to get behind and
29:23
Speaker 4: figure out how to buy more of these large assets.
29:26
Speaker 4: Somebody might try to buy Circle. Somebody needs to start,
29:30
Speaker 4: you know, one.
29:31
Speaker 2: Of the banks. I'm talking about banks.
29:33
Speaker 4: I'm not telling individuals to go buy you know, any
29:35
Speaker 4: particular assets, but I do think the banks should really
29:39
Speaker 4: roll up their sleeves, stop acting like they can't, you know,
29:43
Speaker 4: they can't innovate, and really start engaging with the crypto
29:47
Speaker 4: companies and individuals who are smart enough to spend time
29:53
Speaker 4: and educate them. Yeah, some big platforms out there do
29:55
Speaker 4: really well. If this doesn't go through, I think, ultimately,
29:59
Speaker 4: I think crypto, you know, we put a bit of
30:02
Speaker 4: a ceiling on crypto.
30:05
Speaker 2: I still think it has trillions.
30:06
Speaker 4: To go, of course over the long term, but I
30:08
Speaker 4: think we kind of put a ceiling on it if
30:10
Speaker 4: we don't get more institutional trad FI participation. I do
30:15
Speaker 4: like the ETFs that helped our business immenseally. We don't
30:17
Speaker 4: offer ETFs, but it became a gateway opportunity for people
30:22
Speaker 4: to get in through the ETFs. It said something crypto
30:25
Speaker 4: was approved. It felt a little safer, and big names
30:29
Speaker 4: got behind it, and that's why ETFs took off.
30:32
Speaker 2: We don't offer ETFs, but our business took off as well.
30:35
Speaker 2: We tripled, you know.
30:37
Speaker 4: After a dupled, it validated the space, and I think
30:42
Speaker 4: that tradifi coming in at some capacity it also further validates.
30:49
Speaker 4: And I think there's a massive worry of the banks
30:52
Speaker 4: with this transfer of wealth happening.
30:55
Speaker 2: A lot of it's not going to go to the
30:56
Speaker 2: traditional banks.
30:58
Speaker 4: The kids, the boomers of these of these families are
31:01
Speaker 4: going to say.
31:03
Speaker 1: If yeah, I think that ship is saled for for
31:07
Speaker 1: the younger investors, we'll just see too much of it.
31:10
Speaker 1: Last question to you, when you look at self Coustody
31:13
Speaker 1: right now, how do you guys position around it? Is
31:15
Speaker 1: this something you're for. You don't think it's good for
31:18
Speaker 1: people to do self custody?
31:19
Speaker 5: What?
31:20
Speaker 2: What?
31:20
Speaker 1: What's your position?
31:22
Speaker 4: I think people should have the option. Absolutely, don't take
31:25
Speaker 4: that away. There's some very competent, very adept people that
31:29
Speaker 4: the look that are very capable of managing their crypto
31:33
Speaker 4: and their keys. I think there's billions of people around
31:36
Speaker 4: the globe that aren't bankable and don't trust their governments
31:40
Speaker 4: or banks, and so they should be able to hold
31:42
Speaker 4: their own keys, and so I think absolutely we cannot
31:46
Speaker 4: take that away from people at all.
31:49
Speaker 2: From an eye trust capital perspective.
31:51
Speaker 4: We use you know large you know liquidity and storage
31:53
Speaker 4: providers that are battle tested, bluechoop, blue chip names, and
31:57
Speaker 4: they've done a phenomenal job on the US govern and
32:00
Speaker 4: other entities use the entities we use.
32:04
Speaker 2: I personally don't manage my own keys.
32:08
Speaker 4: I saw friends lose their devices and safes and fires
32:12
Speaker 4: in California a year ago this month, and so I
32:17
Speaker 4: use the institutional stuff, but absolutely don't take that away
32:21
Speaker 4: from the individuals that want to hold and manage and
32:25
Speaker 4: be in charge of their own crypto.
32:27
Speaker 2: They shouldn't have.
32:28
Speaker 4: To leave their borders with a reelbarrow full of useless cash.
32:35
Speaker 4: They should be able to put a hard drive in
32:38
Speaker 4: their pocket and walk across the border or memorize some
32:43
Speaker 4: phrases to get them back in anywhere in the world.
32:46
Speaker 2: I don't think they should have to go through an
32:47
Speaker 2: institution for that. We do a great job.
32:50
Speaker 4: Most of our clients are forty to sixty working professionals,
32:53
Speaker 4: and they're sitting there saying, like me, I don't want
32:56
Speaker 4: to deal with that. I don't want to risk getting
32:59
Speaker 4: hacked at Starbucks on my laptop, and I trust capital.
33:02
Speaker 4: It's a closed loop system, right, So you can get
33:05
Speaker 4: lazy and leave your laptop open anywhere and someone could
33:08
Speaker 4: get into your talent and buy and sell your stuff,
33:11
Speaker 4: but they can't leave with your crypto or your cash.
33:14
Speaker 2: That's a closed loop system.
33:15
Speaker 4: It's kind of a security custodial, very secure platform for
33:20
Speaker 4: dummies like me that don't want to worry about it.
33:22
Speaker 2: That being said, you know, let people decide what they want.
33:26
Speaker 2: I like it.
33:26
Speaker 1: Kevin, Thank you so much for coming in today. This
33:29
Speaker 1: is going to be a very active week with everything
33:32
Speaker 1: that's being negotiated in DC, so we'll be tracking that closely.
33:36
Speaker 2: Thanks a lot.
33:37
Speaker 4: Yeah, I think we'll get some good things thanks for
33:39
Speaker 4: having me. And by the end of this month, I
33:40
Speaker 4: think we're going to get a lot more clarity. And
33:43
Speaker 4: it's not going to be perfect. We should be prepared
33:45
Speaker 4: for that. Both sides might feel slightly screwed. My attorneys
33:49
Speaker 4: told me that's a great settlement. I don't want to
33:52
Speaker 4: get screwed too much, and I don't want to give
33:54
Speaker 4: the banks too much power. And I am excited though
33:57
Speaker 4: that there are some banks saying, look, we just want
34:00
Speaker 4: to do some big things with you know, your community,
34:05
Speaker 4: and to help serve others.
34:07
Speaker 2: Is that hyperbole? I don't know. I think the banks
34:09
Speaker 2: are wording. They're trying to catch up right now.
34:18
Speaker 1: If you like this video, like and subscribe, drop a
34:21
Speaker 1: comment down below, and also join our free private member group.
34:24
Speaker 2: The link is in the description.