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CLARITY Act Odds Skyrocket!🚀Solana Policy Institute INTERVIEW · The Paul Barron Crypto Show

• 0:00
  Speaker 1: Things are starting to get heated in DC, and of
• 0:03
  Speaker 1: course all of this is coming down to one thing,
• 0:05
  Speaker 1: and that is the Clarity Act. Odds are skyrocketing today.
• 0:08
  Speaker 1: We'll break it down for you. Let's just get right
• 0:10
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• 0:12
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• 0:42
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• 0:45
  Speaker 2: It's a big one.
• 0:46
  Speaker 1: Let's go over and kick this off with some things
• 0:49
  Speaker 1: that are happening not only in DC but also around
• 0:53
  Speaker 1: the big line in the sand, which is really boiling
• 0:56
  Speaker 1: down to the banks versus crypto. When it comes to
• 0:59
  Speaker 1: stable coin fields.
• 1:00
  Speaker 2: Well, this is.
• 1:00
  Speaker 1: Bernie Moreno talking about this very issue at the most
• 1:05
  Speaker 1: recent World Liberty Finance Conference.
• 1:07
  Speaker 3: Take a look, what is the status of the market
• 1:11
  Speaker 3: structure regulation that you famously blocked from passing.
• 1:17
  Speaker 2: I wouldn't say we blocked it.
• 1:18
  Speaker 3: Some critics would say, you're just trying to protect your business.
• 1:21
  Speaker 4: Look, the role of the United States government or any
• 1:23
  Speaker 4: government is not to protect incumbency or business models that
• 1:26
  Speaker 4: are eventually going to be replaced.
• 1:28
  Speaker 3: Who's going to be replaced?
• 1:30
  Speaker 4: Well, look as sears how Amazon worked out for them,
• 1:32
  Speaker 4: Blockbuster on Netflix worked out for him. Our job isn't
• 1:36
  Speaker 4: to protect business models and just not working. Young people
• 1:39
  Speaker 4: don't like our current financial system. It's going to be replaced.
• 1:42
  Speaker 4: We want it to happen here in America.
• 1:43
  Speaker 3: Were you surprised? What was your reaction when he after
• 1:46
  Speaker 3: he's obviously been so involved in this and was so
• 1:48
  Speaker 3: deep on it and then came out against the version
• 1:50
  Speaker 3: of the bill.
• 1:51
  Speaker 4: Well, look, concerns about the bill. We got to hung
• 1:54
  Speaker 4: up on the issue of rewards and stable coins, which
• 1:56
  Speaker 4: is really, in my mind, really shouldn't be part of
• 1:59
  Speaker 4: this equation.
• 2:00
  Speaker 2: But can we just.
• 2:00
  Speaker 3: Explain this why should people should care about this?
• 2:03
  Speaker 4: Well, unless you're on a bank, you probably shouldn't care.
• 2:06
  Speaker 4: Because if you're an American consumer, what it means is
• 2:09
  Speaker 4: that the cash that you hold, you're going to have
• 2:11
  Speaker 4: competition to pay.
• 2:12
  Speaker 2: You more interest.
• 2:13
  Speaker 4: But we're going to get this bill across the finish line.
• 2:15
  Speaker 4: But I would say, well, hopefully by April. Hopefully by April,
• 2:19
  Speaker 4: and I feel confident that is it moving.
• 2:21
  Speaker 3: Forward with these rewards in place for stable coin.
• 2:25
  Speaker 2: Yes, there's a small list of remaining open items. If
• 2:28
  Speaker 2: a compromise can be found, this will get to the
• 2:30
  Speaker 2: President's desk for a signature in a few months.
• 2:32
  Speaker 3: Say, because if you don't buy the midterms and then
• 2:35
  Speaker 3: the House goes Democrat, then what happens to it?
• 2:38
  Speaker 4: Well, the House isn't going to go Democrat and new
• 2:40
  Speaker 4: there's the Senate.
• 2:42
  Speaker 1: Okay, Well there's Bernie Moreno talking about that right there.
• 2:45
  Speaker 1: You have Brian Armstrong right there on his side. They're
• 2:48
  Speaker 1: kind of talking in tandem about protecting rewards. So we
• 2:51
  Speaker 1: wanted to get an update on what's happening in DC.
• 2:54
  Speaker 1: We thought we'd bring in Miller White House Levine, who
• 2:57
  Speaker 1: is head of the Salona Policy Institute.
• 2:59
  Speaker 2: Great to have you. Oh, thank you for having me, so, Miller.
• 3:02
  Speaker 1: Let's get into a few points right now. The Clarity
• 3:04
  Speaker 1: Act has skyrocketed in the probability I'm looking at the
• 3:07
  Speaker 1: poly market right there, jumps dramatically over just the last
• 3:11
  Speaker 1: twenty four hours, after it went up from fifty five
• 3:14
  Speaker 1: percent last week, is now skyrocketed to seventy six percent.
• 3:18
  Speaker 1: What is going on in DC that would make that
• 3:21
  Speaker 1: move so quickly, at least in the poly mark?
• 3:24
  Speaker 2: What are you hearing? Well?
• 3:25
  Speaker 5: I think it's reflective of the immense amount of progress
• 3:29
  Speaker 5: the White House has been making with the banks and
• 3:31
  Speaker 5: the crypto lobby on trying to reach some sort of conclusion,
• 3:35
  Speaker 5: productive conclusion to this stable coin yield for reward issue
• 3:39
  Speaker 5: and disagreement. Of course, to Senator Mareno's point, I think folks,
• 3:44
  Speaker 5: and we agree in industry, think that this was settled
• 3:48
  Speaker 5: last year when the Genius Act passed, and the banks
• 3:51
  Speaker 5: should have made their case then and not caused us
• 3:54
  Speaker 5: problems on the Clarity Act this year.
• 3:57
  Speaker 2: But we are where we are, and I.
• 3:59
  Speaker 5: Think the White House's total commitment to getting this issue
• 4:02
  Speaker 5: resolved has been the critical factor and it will remain
• 4:06
  Speaker 5: the critical factor if anyone could get it done, it's them,
• 4:09
  Speaker 5: and so I think their engagement. There were some rumors
• 4:12
  Speaker 5: yesterday that they may have another meeting tomorrow at the
• 4:15
  Speaker 5: White House between the banks and the crypto folks with
• 4:19
  Speaker 5: an interest in the rewards issue. So I think as
• 4:22
  Speaker 5: long as the White House remains engaged and committed to
• 4:24
  Speaker 5: getting this done, actively trying to facilitate resolution, folks are
• 4:29
  Speaker 5: rightly hopeful that the bill will pass.
• 4:32
  Speaker 1: Yeah, why haven't we seen Trump just come out and
• 4:35
  Speaker 1: publicly say, hey, we should really do this. I mean,
• 4:38
  Speaker 1: it would be right within his bailiwick of saying, let's
• 4:41
  Speaker 1: get more money to the American people, especially in this
• 4:45
  Speaker 1: affordability crisis that we're facing. What do you think is
• 4:47
  Speaker 1: holding the card back from doing that?
• 4:51
  Speaker 2: I completely agree.
• 4:52
  Speaker 5: You know, at the end of the day, what the
• 4:53
  Speaker 5: banks are trying to prevent is the broader, wider sharing
• 4:58
  Speaker 5: of yield to consumers. It's certainly in every consumer's interest
• 5:02
  Speaker 5: for rewards to be shared with them, and the government
• 5:06
  Speaker 5: shouldn't play a part in preventing that. I think the
• 5:08
  Speaker 5: President's been certainly supportive of getting a deal done here.
• 5:12
  Speaker 5: I think that, you know, just in Davos, a few
• 5:15
  Speaker 5: weeks ago he got for the bill to get passed.
• 5:17
  Speaker 5: In response to our reporter question, I think last week
• 5:20
  Speaker 5: in the Oval Office he's.
• 5:21
  Speaker 2: That he looked forward to getting the bill done.
• 5:23
  Speaker 5: So my ambression is the president's pretty active, and he
• 5:26
  Speaker 5: certainly has been using the bully pulpit to press for
• 5:31
  Speaker 5: a deal on this issue. And I do think to
• 5:33
  Speaker 5: the extent you know, there is transigence on either side
• 5:37
  Speaker 5: of this debate that we could see, you know, the
• 5:41
  Speaker 5: President get more directly active.
• 5:43
  Speaker 1: You mentioned that there might be another meeting with the banks.
• 5:48
  Speaker 1: This tells me that at least it appears there could
• 5:51
  Speaker 1: be some concessions being made by one side or both.
• 5:55
  Speaker 1: Right now, if you were a polymarket batman, would you
• 6:00
  Speaker 1: think this fall? Do you think the banks are conceding
• 6:03
  Speaker 1: some issues around stable coin yields or do you think
• 6:05
  Speaker 1: crypto is conceding or have they come to an alignment
• 6:08
  Speaker 1: that maybe allows both to win.
• 6:11
  Speaker 2: Well, I don't think that alignment has been found. It's
• 6:13
  Speaker 2: certainly the goal.
• 6:14
  Speaker 5: I think the document that came from the banks, as
• 6:18
  Speaker 5: reported from last week's White House meeting, I think that
• 6:21
  Speaker 5: was last week, but a lot's been going on. They
• 6:24
  Speaker 5: I think got further away from any position they had
• 6:28
  Speaker 5: previously expounded on the issue, and we're going in the
• 6:31
  Speaker 5: opposite direction. You know, I think that list of items
• 6:35
  Speaker 5: was effectively a prohibition on direct or indirect rewards of
• 6:40
  Speaker 5: any variety to anyone, and that is certainly not where
• 6:44
  Speaker 5: the banks were even in January. So I think that
• 6:47
  Speaker 5: that document didn't evidence much open mindedness or desired to
• 6:52
  Speaker 5: reach a productive conclusion. And so I think the hope
• 6:56
  Speaker 5: is that this week that will change.
• 6:58
  Speaker 2: All right.
• 6:59
  Speaker 1: So if that's the case, they were moving kind of
• 7:01
  Speaker 1: the opposite direction. You have the White House putting a
• 7:04
  Speaker 1: lot of pressure on it. Then of course we see
• 7:06
  Speaker 1: the you know, the situation right now, which has really
• 7:09
  Speaker 1: been targeting this March first deadline that President Trump put
• 7:13
  Speaker 1: on Congress to get this done. And of course you
• 7:16
  Speaker 1: now potentially have the banks kind of either pretending to
• 7:19
  Speaker 1: compromise or is it just a lot of pressure coming
• 7:23
  Speaker 1: in from the Trump administration that's saying this is the
• 7:26
  Speaker 1: way forward, guys, and you have to follow the rules here.
• 7:30
  Speaker 2: Yeah.
• 7:30
  Speaker 5: My guess is you know how this ends is the
• 7:33
  Speaker 5: White House is going to make a policy decision that
• 7:35
  Speaker 5: neither side is going to be happy with. You know,
• 7:38
  Speaker 5: I think it's one of those the adage that if
• 7:41
  Speaker 5: everyone's unhappy, then you probably have reached a good conclusion.
• 7:44
  Speaker 5: And I think that's what is going to happen here.
• 7:48
  Speaker 5: I think that you know, from the bank side, it
• 7:52
  Speaker 5: is difficult to decline to engage with the White House
• 7:56
  Speaker 5: in a productive way, and so I think it's been
• 7:58
  Speaker 5: extraordinarily helpful for Patuit and the White House to remain
• 8:03
  Speaker 5: a convening force here because it's the only way to
• 8:06
  Speaker 5: get folks to the table.
• 8:08
  Speaker 1: Do you think they're going to miss the March first
• 8:10
  Speaker 1: because Moreno was talking about April, that would be another
• 8:13
  Speaker 1: thirty days in the hopper of trying to get this done.
• 8:16
  Speaker 1: You've got the skyrocketing odds right now on polymarket. It
• 8:20
  Speaker 1: looks to me like something's going on that hasn't been
• 8:23
  Speaker 1: revealed to the market just yet. Somebody knows something. So
• 8:27
  Speaker 1: do you feel like March first is even potentially in
• 8:29
  Speaker 1: the cards?
• 8:30
  Speaker 2: Here?
• 8:30
  Speaker 1: We are twelve days out or ten days out.
• 8:32
  Speaker 5: I think we could definitely see a stable, going reward
• 8:35
  Speaker 5: yield deal before the end of March, and I think
• 8:37
  Speaker 5: that was excuse me, before March, and I think that
• 8:40
  Speaker 5: was the deadline that the White House had set for
• 8:44
  Speaker 5: stable going reward deal. I think that to the extent
• 8:48
  Speaker 5: a reward and yield deal is reached, and to your point,
• 8:51
  Speaker 5: maybe it has been reached and you know, hasn't been
• 8:54
  Speaker 5: shared with the world yet, that is going to be
• 8:58
  Speaker 5: a starting gun or or perhaps you know, more of
• 9:01
  Speaker 5: a of a closing gun for the broader market structure effort.
• 9:05
  Speaker 5: This yield reward issue has metastasized into such a nightmare
• 9:09
  Speaker 5: that I think to the extent a deal is reached
• 9:12
  Speaker 5: on this issue, then the bill is moving and you
• 9:15
  Speaker 5: know it's one hundred percent happening, and stay out of
• 9:19
  Speaker 5: the way of the freight train type thing. So I
• 9:22
  Speaker 5: think to the extent yield and reward issue is resolved,
• 9:26
  Speaker 5: there's going to be immense amount of momentum to get
• 9:30
  Speaker 5: the broader build done. Because one thing is for sure.
• 9:33
  Speaker 5: Everyone can agree that no one wants to go through
• 9:36
  Speaker 5: any of this again. So I think, to the extent
• 9:38
  Speaker 5: that has resolved, folks that are going to be like,
• 9:40
  Speaker 5: let's get her done.
• 9:42
  Speaker 1: Let's take it on. Let's steal man a little bit
• 9:44
  Speaker 1: and take a look at it. What happens if there
• 9:48
  Speaker 1: is a concession, you know, and whether it's Crypto conceding
• 9:52
  Speaker 1: and the banks possibly get some sort of deal on
• 9:56
  Speaker 1: banning yields. My next question is is how does this
• 10:00
  Speaker 1: effect DeFi, because obviously DeFi will be the area where
• 10:03
  Speaker 1: most people will flock to four yields now because you
• 10:07
  Speaker 1: can't get them in your exchange. Potentially, what kind of
• 10:10
  Speaker 1: impact do you think that would have on banks seeing
• 10:13
  Speaker 1: that start to.
• 10:14
  Speaker 5: Occur, Well, I think, you know, trad FI and banks,
• 10:19
  Speaker 5: you know, I think one of the broader stories of
• 10:21
  Speaker 5: twenty twenty five and this administration, beyond it being you know,
• 10:24
  Speaker 5: such an amazingly favorable policy environment, is trad FI and
• 10:28
  Speaker 5: the banks have arrived, you know, even last year in
• 10:31
  Speaker 5: summer on genius and clarity passing through the house.
• 10:36
  Speaker 2: They you know, had been nowhere to be found.
• 10:39
  Speaker 5: And they certainly had it engaged prior to twenty twenty five,
• 10:44
  Speaker 5: and you know how to dick it. Seriously, I think
• 10:46
  Speaker 5: that the bank's engagement, you know, is to me extremely
• 10:51
  Speaker 5: validating because they spent the prior eight years, you know,
• 10:53
  Speaker 5: saying all of this is fake and does it matter?
• 10:56
  Speaker 5: And now it's an existential threat to the entire banking
• 10:59
  Speaker 5: sect there if you know, you take what they're saying
• 11:02
  Speaker 5: at face value, and the same will be true for
• 11:05
  Speaker 5: DeFi in their worldview. So I think that either the
• 11:09
  Speaker 5: banks are floundering a bit here and are trying to
• 11:12
  Speaker 5: figure out their pivot to grypto and public block chains.
• 11:17
  Speaker 5: I certainly welcome it, and I think, you know, the
• 11:21
  Speaker 5: folks that could get ahead of the curve and skate
• 11:23
  Speaker 5: to where the puck is going, so to speak, are
• 11:27
  Speaker 5: going to be rewarded long term. But of course they
• 11:29
  Speaker 5: are going to be folks that try to use the
• 11:31
  Speaker 5: existing regulatory regime to to prevent competition from from arising.
• 11:37
  Speaker 5: And I think that's, you know, the gist of what
• 11:39
  Speaker 5: we're seeing here.
• 11:40
  Speaker 1: Yeah, you mentioned that this is going to create kind
• 11:43
  Speaker 1: of a starting gun approach. One of the things that
• 11:46
  Speaker 1: potentially could have a big impact is synthetic stocks Salana
• 11:50
  Speaker 1: of course being one of the cornerstones of where this
• 11:53
  Speaker 1: activity is taking place right now. But we could see
• 11:57
  Speaker 1: this maybe rolling into a KYC am situation. My question is,
• 12:03
  Speaker 1: if we get into a KYC situation, how much of
• 12:06
  Speaker 1: an impact do you think that would have on something
• 12:08
  Speaker 1: like an x stox or any of those synthetic stock platforms.
• 12:12
  Speaker 5: Yeah, I think it depends on which markets we're talking
• 12:17
  Speaker 5: about here, So I think for like cryptospot markets and
• 12:19
  Speaker 5: regular trading, we're certainly a long way off from any
• 12:23
  Speaker 5: k y C a mL requirements and are actively advocating
• 12:27
  Speaker 5: against it. On the security side, it's going to be
• 12:30
  Speaker 5: more complicated and everyone should prepare for that for a
• 12:33
  Speaker 5: variety of reasons. Number one, they are regulated markets, and
• 12:38
  Speaker 5: you know, historically the Bank Secrecy Act as applied to
• 12:41
  Speaker 5: intermediaries operating in the securities markets. I think that's going
• 12:45
  Speaker 5: to stay consistent, and you know, leaves the question as
• 12:51
  Speaker 5: to what an intermediary is versus what DeFi is, which
• 12:54
  Speaker 5: is how a lot of these conversations end or where
• 12:57
  Speaker 5: a lot of these conversations lead to.
• 13:00
  Speaker 2: So that's the first thing I'll say.
• 13:01
  Speaker 5: The second is with respect to securities, or at least
• 13:04
  Speaker 5: native securities on chain, which is the goal, like we
• 13:07
  Speaker 5: want the actual equity security on chain is the vision.
• 13:12
  Speaker 5: The Securities Acts have separate disclosure requirements that are unrelated
• 13:18
  Speaker 5: to AML CFT issues. So for example, major holders of
• 13:23
  Speaker 5: US equity securities for completely different reasons have to be
• 13:26
  Speaker 5: disclosed and they're you know, major trading has to be disclosed, etc.
• 13:32
  Speaker 5: I think the threshold is five percent. It's incompatible with
• 13:35
  Speaker 5: a pseudonymous system, and I think is one of the
• 13:39
  Speaker 5: core challenges that the SEC is actively working through. They
• 13:43
  Speaker 5: I think are trying to retain the permissionless aspect of
• 13:47
  Speaker 5: defive protocols public blockchains while vindicating the disclosure obligations that
• 13:53
  Speaker 5: are required in US securities markets, which I think will
• 13:56
  Speaker 5: require some sort of identity. You know, I think long term,
• 14:00
  Speaker 5: my personal view is that the Bank Secrecy Act is
• 14:02
  Speaker 5: un constitutional and it's a dying regime that doesn't work,
• 14:06
  Speaker 5: and you know, it's it's it's ready, it's ready for
• 14:11
  Speaker 5: the asheep of history.
• 14:12
  Speaker 2: But that's a long term that's a long term battlefall. Yeah,
• 14:16
  Speaker 2: it is.
• 14:17
  Speaker 1: Well, it's one that I think right now we're at
• 14:20
  Speaker 1: a very pivotal point because this is most like, yeah,
• 14:24
  Speaker 1: it's going to open up all kinds of issues that
• 14:26
  Speaker 1: are immediately going to go right into the Bank Secrecy
• 14:29
  Speaker 1: Act and it's going to cause rub across this issue
• 14:32
  Speaker 1: that's been out there for quite some time.
• 14:34
  Speaker 2: So I don't know if.
• 14:35
  Speaker 1: If you're exactly right, yeah, yeah, If we deal with that, though,
• 14:39
  Speaker 1: do you think there will be an interim where people
• 14:42
  Speaker 1: that maybe already hold a lot of these synthetics right
• 14:45
  Speaker 1: now that would be forced to either sell and rebuy
• 14:49
  Speaker 1: or how do you think that would play out on
• 14:51
  Speaker 1: somebody that's already in the market.
• 14:54
  Speaker 5: Since they're already in the market, it's all offshore and
• 14:56
  Speaker 5: so they are just operating under a different framework. It's
• 15:01
  Speaker 5: you know, offshore US securities, so don't really have to
• 15:04
  Speaker 5: think about it. So my expectation is that they will
• 15:07
  Speaker 5: remain unaffected. What the SEC is going to unlock is
• 15:13
  Speaker 5: US person straighting US securities on public block chains in
• 15:17
  Speaker 5: DeFi in the US, that's you know, greenfield that we've
• 15:20
  Speaker 5: never had before and a year ago could imagine having.
• 15:24
  Speaker 5: So I think it's what they're doing is making the
• 15:26
  Speaker 5: pie bigger versus I think preventing anyone from from experimenting
• 15:30
  Speaker 5: the way they are today.
• 15:31
  Speaker 1: What do you make of the pre stocks angle we've
• 15:35
  Speaker 1: seen now Robinhood moving into this space with Robinhood Ventures
• 15:39
  Speaker 1: obviously pre stocks right here, these are being able to
• 15:42
  Speaker 1: invest in companies before they go public. The idea is
• 15:45
  Speaker 1: that you know, you look at about that and first
• 15:48
  Speaker 1: of all, do you think this is going to be
• 15:50
  Speaker 1: a major move? Do you think the SEC is going
• 15:53
  Speaker 1: to get involved in this and say no, we can't,
• 15:55
  Speaker 1: we can't get into this kind of situation.
• 15:57
  Speaker 2: This should be a security.
• 15:59
  Speaker 5: Well think they are securities, and I think those folks don't,
• 16:03
  Speaker 5: don't deny that they're securities. The SEC is trying to
• 16:06
  Speaker 5: create a framework where it's saying it's okay to be
• 16:09
  Speaker 5: a security actually because we're going to create a framework
• 16:12
  Speaker 5: for you that is combatible with trading and activities on
• 16:17
  Speaker 5: public blockchains. So being a security is no longer a
• 16:20
  Speaker 5: death sentence, you know, like it's the US capital markets.
• 16:24
  Speaker 5: We love securities more than anything. And to the extent
• 16:27
  Speaker 5: that you can issue a equity security on a public
• 16:31
  Speaker 5: blockchain and be in compliance, that's an amazing outcome for everyone.
• 16:36
  Speaker 5: So I think the presecurities thing is an interesting one though,
• 16:40
  Speaker 5: because it's more broadly aligned with the SEC's the current
• 16:45
  Speaker 5: SEC's philosophy. I think around freeing capital and freeing access
• 16:50
  Speaker 5: to investments. I think this commission with Chairman Atkins and
• 16:55
  Speaker 5: commissioners person you waita have. I think the lack of
• 17:01
  Speaker 5: participation in public markets among US companies over the last
• 17:05
  Speaker 5: you know, fifteen years, I think has been a tragic
• 17:08
  Speaker 5: outcome of over regulation in their minds. I think it
• 17:13
  Speaker 5: was twenty nineteen is the last data I saw, But
• 17:16
  Speaker 5: more capital was raised via private exemp securities offerings than
• 17:22
  Speaker 5: public ips.
• 17:23
  Speaker 2: That is a.
• 17:26
  Speaker 5: Situation that's not just terrible for companies and folks trying
• 17:30
  Speaker 5: to raise money to start new innovative businesses, but also
• 17:33
  Speaker 5: for anyone that's not already rich and wealthy and therefore
• 17:36
  Speaker 5: has access to private investments. You know, you have to
• 17:39
  Speaker 5: have a million dollars in liquid assets outside of your
• 17:41
  Speaker 5: primary home and make over two hundred and fifty k
• 17:44
  Speaker 5: a year to access the private markets in the US
• 17:47
  Speaker 5: right now. So you know, that's I think an intolerable,
• 17:51
  Speaker 5: intolerable situation, and I think the Commission agrees, So I
• 17:55
  Speaker 5: expect that they'll be probably supportive of initiatives like this
• 17:59
  Speaker 5: that provide access or liquidity to early stage employees, companies
• 18:05
  Speaker 5: that have for rewarded employees with stock equity, and I think,
• 18:10
  Speaker 5: you know, it's broadly aligned with their agenda of freeing
• 18:14
  Speaker 5: capital and freeing access to investment opportunities for US citizens.
• 18:19
  Speaker 1: Well, you know, and Paul has talked about this is
• 18:22
  Speaker 1: that when you look at the accredited investor situation, what
• 18:25
  Speaker 1: you're referencing there right now. That would to your point,
• 18:28
  Speaker 1: I think it would really open up the opportunity not
• 18:30
  Speaker 1: only for individuals to be able to buy in to
• 18:33
  Speaker 1: you know, these kinds of opportunities, but I think it's
• 18:36
  Speaker 1: going to open up the opportunities for companies to actually
• 18:39
  Speaker 1: accelerate into the market. To your point, so very big deal.
• 18:43
  Speaker 1: I want to get over to another situation that also
• 18:46
  Speaker 1: is a big trend, and that is prediction markets. You've
• 18:49
  Speaker 1: got Mike Seely right here, of course, coming in from
• 18:51
  Speaker 1: the CFTC says, hey, we filed this brief. This is
• 18:54
  Speaker 1: the Ninth Circuit Court. This is basically defending the CFT's
• 18:58
  Speaker 1: authority to regulate the prediction market. But at the same time,
• 19:01
  Speaker 1: you've got states that are out there trying to pull
• 19:03
  Speaker 1: a little bit of a push pull against prediction markets.
• 19:07
  Speaker 1: Do you think the CFTC is going to go full
• 19:10
  Speaker 1: on against these states that try to try to basically
• 19:13
  Speaker 1: buck their current situation.
• 19:17
  Speaker 2: I definitely think so.
• 19:18
  Speaker 5: I think that's exactly what Mike did yesterday, or Charon Seelig.
• 19:21
  Speaker 2: Excuse me. I think that that was as guns.
• 19:25
  Speaker 5: Of laziness it gets in the world of administrative law litigation.
• 19:31
  Speaker 5: So they dismitted a masterful brief last night, and I think,
• 19:36
  Speaker 5: you know, the litigation around this issue, it's almost impossible
• 19:40
  Speaker 5: to follow because there are so many cases that are
• 19:42
  Speaker 5: moving so quickly, but it's it's a surely signal that
• 19:46
  Speaker 5: the CFTC and the new chairman has an extremely strong
• 19:51
  Speaker 5: view that these assets or contracts excuse me, are within
• 19:54
  Speaker 5: the existing jurisdiction of the CFTC and therefore preempted from
• 19:59
  Speaker 5: state life and regulation. I expect this one to go
• 20:04
  Speaker 5: to the Supreme Court, given the amount of litigation, the
• 20:08
  Speaker 5: fact that states are parties of this litigation, and now
• 20:10
  Speaker 5: that a federal agency is involved. Yeah, it seems like
• 20:13
  Speaker 5: that's where it's adding for sure.
• 20:15
  Speaker 1: I'm looking at the CFTs Innovation Advisory and Committee members.
• 20:20
  Speaker 1: Solana of course is down here on it as well,
• 20:23
  Speaker 1: so we've got Salon of Labs with totally on there.
• 20:25
  Speaker 1: I'm kind of curious what kind of matters do you
• 20:27
  Speaker 1: think would pertain to Solana, you know, from an advisory role,
• 20:32
  Speaker 1: how do you see that potentially structuring under the CFTC
• 20:36
  Speaker 1: with all these advisors in here, because there's a lot
• 20:38
  Speaker 1: of different people in here from different chains, et cetera.
• 20:41
  Speaker 1: What is Solana's big take here.
• 20:44
  Speaker 2: That's exactly right, I know.
• 20:46
  Speaker 5: And there's a lot of different kinds of businesses or
• 20:49
  Speaker 5: you know, software developers on that list, and I think
• 20:52
  Speaker 5: it's reflective of the fact that the participation in futures
• 20:57
  Speaker 5: markets in twenty twenty six is uh, you know, quite varied,
• 21:02
  Speaker 5: and the venues in which that activity is happening has uh,
• 21:06
  Speaker 5: you know, exploded in a Cambrian style uh experimentation over
• 21:11
  Speaker 5: the last few years.
• 21:12
  Speaker 2: You f cme you know, as.
• 21:14
  Speaker 5: Drat as it gets uh on that Advisory Council because
• 21:18
  Speaker 5: futures are trading there, and uh you also have totally
• 21:22
  Speaker 5: on there because folks have built prediction markets and all
• 21:26
  Speaker 5: sorts of you know, derivatives or assets within the CFTC's
• 21:31
  Speaker 5: jurisdiction on Salona.
• 21:32
  Speaker 2: So I think that, you know, broadly, the vision of.
• 21:35
  Speaker 5: Internet capital markets requires all of these different things to
• 21:39
  Speaker 5: eventually exist on chain. It's never been possible to offer
• 21:44
  Speaker 5: derivatives in a compliant way or futures in a compliant
• 21:47
  Speaker 5: way to us persons, and so the hope is the
• 21:51
  Speaker 5: CFTC is going to make that possible across a whole
• 21:54
  Speaker 5: host of venues. If you would like to go use
• 21:57
  Speaker 5: a protocol on chain using your cell phos.
• 22:00
  Speaker 2: To ball it.
• 22:01
  Speaker 5: You know, here's the pathway to do that. If you'd
• 22:03
  Speaker 5: like to go to CMME enjoy go at it. So
• 22:07
  Speaker 5: I think it's reflective of the fact that the CFTC
• 22:12
  Speaker 5: is not going to be picking winners and losers here
• 22:15
  Speaker 5: via regulatory requirements. I think their goal is to create
• 22:19
  Speaker 5: a level playing field and let the market decide.
• 22:22
  Speaker 1: I'm looking at some of the concessions that seem to
• 22:25
  Speaker 1: have been made during the structure of building the Clarity Plan.
• 22:29
  Speaker 1: I think in front of Congress, one of the big
• 22:31
  Speaker 1: ones that kind of came on was the whole idea
• 22:35
  Speaker 1: around credit card routing. And for many of you guys
• 22:38
  Speaker 1: may not be aware that the idea was to offer
• 22:42
  Speaker 1: a third option. Third option could have been easily crypto.
• 22:45
  Speaker 1: I look at Salona pay and I think, man, this
• 22:48
  Speaker 1: was a missed opportunity of getting crypto maybe into retail
• 22:53
  Speaker 1: payments for the first time. Do you think this is
• 22:57
  Speaker 1: maybe going to take some more time to be able
• 22:59
  Speaker 1: to get something like this enacted again to open up
• 23:02
  Speaker 1: crypto into retail payments.
• 23:04
  Speaker 5: I think the big hold up there is not going
• 23:06
  Speaker 5: to be on these market structure issues. It's going to
• 23:09
  Speaker 5: be on tax issues today. You know, for example, you
• 23:13
  Speaker 5: have every time you buy and sell the stable coin
• 23:16
  Speaker 5: or use a stable coin to buy and sell something,
• 23:18
  Speaker 5: you have some miniscule tax obligation under current law.
• 23:22
  Speaker 2: For example, if your stable coin was point.
• 23:25
  Speaker 5: Nine nine nine nine, you know, dollars at the time
• 23:27
  Speaker 5: that you bought it, and then you sell it for
• 23:29
  Speaker 5: a cent and point through zero one sense, you have
• 23:34
  Speaker 5: technically a reportable appreciation of wealth.
• 23:37
  Speaker 2: That you have to pay taxes on to the US Treasury.
• 23:40
  Speaker 5: That is just obviously not a viable tax situation for
• 23:44
  Speaker 5: stable coins and a host of other crypto assets. So
• 23:48
  Speaker 5: I think that that's going to be the key hold up.
• 23:50
  Speaker 5: I think, you know, in my view of any player
• 23:53
  Speaker 5: and traditional markets broadly, the payments networks MasterCard and Visa
• 23:59
  Speaker 5: and by far the most forward leading on crypto issues
• 24:04
  Speaker 5: Visa as gentlemen Guy Sheffield, who's been leading a team
• 24:08
  Speaker 5: over there for years and years and years.
• 24:09
  Speaker 2: So I think the payments networks are ready.
• 24:13
  Speaker 5: I don't think it's going to be these regulatory issues
• 24:16
  Speaker 5: outside of tax that are going to be the big
• 24:18
  Speaker 5: hold up.
• 24:18
  Speaker 2: I think it's the tax.
• 24:20
  Speaker 1: To it man Okay, well, we'll see how that plays out,
• 24:22
  Speaker 1: because that's according to everybody I've talked to in DC.
• 24:25
  Speaker 1: That's kind of the next shoe to drop is the
• 24:28
  Speaker 1: taxing and dealing with tax I think law around where
• 24:32
  Speaker 1: crypto is going to be going, and of course all
• 24:34
  Speaker 1: these new instruments that are essentially going to be developed
• 24:37
  Speaker 1: coming out of market clarity. I'm going to go to
• 24:39
  Speaker 1: our speed round with you, and this is just quick
• 24:41
  Speaker 1: questions on where you land on different issues. This is
• 24:46
  Speaker 1: the first one yield compromise will be reached by March first.
• 24:50
  Speaker 1: I think you answered that earlier. You think it might happen.
• 24:53
  Speaker 1: I'm kind of on your side. I think we might
• 24:56
  Speaker 1: see something.
• 24:57
  Speaker 2: It may not get.
• 24:58
  Speaker 1: Through, but I think we'll have indicator by March first
• 25:01
  Speaker 1: that yes, it's it's going to happen. All right, So
• 25:04
  Speaker 1: this is going to come fast. Banks will try to
• 25:06
  Speaker 1: ban phantom cash rewards. That's the alternative if they do
• 25:09
  Speaker 1: create some sort of weirdness there.
• 25:12
  Speaker 2: What do you think they're going to try to ban everything?
• 25:14
  Speaker 1: So I'm a yes, okay, yeah, at least the same
• 25:18
  Speaker 1: way on the revenue sharing tokens. What about that Jupiter
• 25:22
  Speaker 1: miniora Camino, Well, those have Do you think that's going
• 25:25
  Speaker 1: to get SEC commit exemption? Okay, I'm with you on this.
• 25:29
  Speaker 2: I like it.
• 25:30
  Speaker 1: I think they are going to get exemption. And then
• 25:32
  Speaker 1: if you look at Clarity Act right now tackling privacy issues,
• 25:36
  Speaker 1: do you think that's going to happen at all?
• 25:38
  Speaker 2: Yeah, okay, we're.
• 25:39
  Speaker 1: Way away from privacy.
• 25:41
  Speaker 2: Yeah, I think.
• 25:42
  Speaker 5: Unfortunately, I think that everyone's hope is to collapse the
• 25:46
  Speaker 5: number of issues being addressed in market structure as still
• 25:50
  Speaker 5: opening new ones. Yeah, like again, four or five months ago,
• 25:53
  Speaker 5: yield rewards, was it even than our topic of conversation
• 25:56
  Speaker 5: in the context of market structure, and here we have, yes.
• 26:00
  Speaker 1: Exactly if a bad bill passes, industry leaders like mister
• 26:04
  Speaker 1: Armstrong will pretend to like it.
• 26:08
  Speaker 2: Do you think that will be the case? What do
• 26:10
  Speaker 2: you think? I think My answer to this one is yes,
• 26:15
  Speaker 2: I think that.
• 26:17
  Speaker 5: They reacted to Coinbase has been pretty pretty Brutalso, yeah.
• 26:23
  Speaker 1: I don't expect We're Liberty Forum event should have happened
• 26:28
  Speaker 1: after Clarity because I think a lot of people are worrying. Hey,
• 26:30
  Speaker 1: this just draws the awareness right back to the Trump administration.
• 26:35
  Speaker 1: And if this was only after Clarity you know, Congress
• 26:38
  Speaker 1: would at least feel better about getting this through.
• 26:40
  Speaker 2: What do you think? Yes, yeah, with you?
• 26:44
  Speaker 1: Okay, Well, we have no side spots here. We got
• 26:47
  Speaker 1: to disagree on somethings. Banks will attend the Rose Garden
• 26:56
  Speaker 1: signing of this.
• 26:58
  Speaker 2: You know, I would love that. Obviously. I'm gonna say
• 27:01
  Speaker 2: yes on that one.
• 27:02
  Speaker 1: Okay, I'm gonna say hell no, they're gonna send the minions.
• 27:07
  Speaker 2: The minions will attend.
• 27:09
  Speaker 1: Jamie Diamond will not be there.
• 27:14
  Speaker 2: That I agree with you? With you there, okay, well
• 27:17
  Speaker 2: that's true. There you go.
• 27:18
  Speaker 1: Hey, listen, this has been a good one. First of all,
• 27:22
  Speaker 1: thanks for coming on today.
• 27:23
  Speaker 2: We appreciate it. Miller.
• 27:24
  Speaker 1: We'll definitely have you back as things get a little
• 27:26
  Speaker 1: bit more heated in DC because this could open a
• 27:29
  Speaker 1: lot of opportunity for Solana being one of the major
• 27:32
  Speaker 1: chains that could benefit from this. So thanks for coming
• 27:34
  Speaker 1: in today. We appreciate it.
• 27:35
  Speaker 2: Exciting times. Thank you for having me.
• 27:43
  Speaker 1: If you like this video, like and subscribe, drop a
• 27:46
  Speaker 1: comment down below, and also join our free private member group.
• 27:50
  Speaker 2: The link is in the description