Latest / The Paul Barron Crypto Show / Bitwise XRP ETF Incoming🔥Matt Hougan Interview

Transcript

Bitwise XRP ETF Incoming🔥Matt Hougan Interview · The Paul Barron Crypto Show

• 0:06
  Speaker 1: Lots of news of course around XRP and ETFs and
• 0:10
  Speaker 1: all of that, and of course today we're going to
• 0:12
  Speaker 1: break it down with a special guest that I think
• 0:13
  Speaker 1: you guys will like to talk about the current markets,
• 0:16
  Speaker 1: where they might be going, and also some of the
• 0:18
  Speaker 1: strategies for a big investment overall, my name is Paul Barrel.
• 0:21
  Speaker 1: Welcome back into tech Path. Before we get started, we
• 0:24
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• 0:25
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• 0:47
  Speaker 1: Maybe this was your first stop today, I want to
• 0:50
  Speaker 1: kind of bring in someone we've been talking about. We've
• 0:52
  Speaker 1: played many clips of him on our show, and of
• 0:56
  Speaker 1: course that is Matt Hogan coming in from bit Wise.
• 0:59
  Speaker 2: Great to have him at Thanks for having me. I'm
• 1:02
  Speaker 2: so excited to be here.
• 1:03
  Speaker 1: Yeah, finally we have you instead of a clip of
• 1:05
  Speaker 1: you that we're usually referencing.
• 1:08
  Speaker 2: So this would be good.
• 1:09
  Speaker 1: We got the live, we get the real, the real world, Matt,
• 1:12
  Speaker 1: as they say, going out there. So a couple of
• 1:14
  Speaker 1: news items I want to hit on, and before we
• 1:16
  Speaker 1: get into some of these topics, Matt, I want to
• 1:18
  Speaker 1: kind of just get your temperature on how the ETFs
• 1:22
  Speaker 1: are overall doing when you look at both eth as
• 1:26
  Speaker 1: well as Bitcoin in general, from not only traditional investment,
• 1:31
  Speaker 1: but also maybe just in general, how the markets are
• 1:33
  Speaker 1: perceiving these ETFs.
• 1:35
  Speaker 2: What do you guys seeing.
• 1:36
  Speaker 3: Yeah, well, I think it's great to call those two out.
• 1:39
  Speaker 3: I mean, look my position, and I come from an
• 1:41
  Speaker 3: ETF background. Right before I moved a bit wise seven
• 1:44
  Speaker 3: years ago, I ran ETF dot com, So.
• 1:46
  Speaker 2: This is my home turf.
• 1:49
  Speaker 3: These are among the most successful ETF launches of all time.
• 1:52
  Speaker 3: I mean, the bitcoin ETFs are the most successful of
• 1:55
  Speaker 3: all time. They've pulled in eighteen point five billion dollars
• 1:58
  Speaker 3: in assets. That's you know, three to four times over
• 2:03
  Speaker 3: the previous record for the fastest growing new ETF. So
• 2:06
  Speaker 3: it's a grand slam. On the east side, you've seen
• 2:10
  Speaker 3: a more nuanced story because you had a lot of
• 2:12
  Speaker 3: money coming out of the grayscale product. But if you
• 2:16
  Speaker 3: look at the new ETPs, they're doing exceptionally well. I know,
• 2:20
  Speaker 3: Blackrocks is over a billion here at bit wise, we're
• 2:23
  Speaker 3: a quarter of a billion dollars.
• 2:25
  Speaker 2: You know, those are among the most.
• 2:28
  Speaker 3: Successful ETF launches this year. So I think, whichever way
• 2:32
  Speaker 3: you look at it, these are a grand slam success.
• 2:35
  Speaker 3: And the key thing I want people to know is
• 2:36
  Speaker 3: that an ETF land typically the first year is the
• 2:40
  Speaker 3: weakest year. Usually the second year is bigger than the first.
• 2:43
  Speaker 3: Then the third is bigger than the second, and the
• 2:44
  Speaker 3: fourth is bigger than the third. So this is a
• 2:47
  Speaker 3: down payment and it's a really big down payment. And
• 2:51
  Speaker 3: I think it's I think I think actually they're going
• 2:53
  Speaker 3: exceptionally well.
• 2:55
  Speaker 1: Well, it's interesting timing when the markets are as they are,
• 2:58
  Speaker 1: which is somewhat vold till. But you also look at
• 3:02
  Speaker 1: a lot of I think beachheads that are starting to
• 3:05
  Speaker 1: be approached, and you look at regulatory we've already started
• 3:09
  Speaker 1: to see a lot of movement in that space. Now
• 3:11
  Speaker 1: we're going to be looking from a political landscape possibly
• 3:13
  Speaker 1: some you know, some clarity there, and I think also
• 3:18
  Speaker 1: just the awareness of what's happening in the investment markets
• 3:21
  Speaker 1: to where investors are finally waking up and saying, hey,
• 3:23
  Speaker 1: this is a real asset, it's not going away, and
• 3:26
  Speaker 1: we're here for the long term. So I would agree
• 3:28
  Speaker 1: with you you guys. Had you guys had some news
• 3:31
  Speaker 1: out here, a bit wise filing to convert three futures
• 3:33
  Speaker 1: based ETFs to your new trend wise strategy, Explain what
• 3:38
  Speaker 1: you guys are doing with that real quickly for our audience.
• 3:41
  Speaker 2: Yeah. Absolutely.
• 3:42
  Speaker 3: You know a lot of people before we had spot ETFs,
• 3:45
  Speaker 3: a bunch of firms filed to offer future based ETFs,
• 3:48
  Speaker 3: and we were one of them. But once you have
• 3:50
  Speaker 3: spot ETFs, those are more efficient than futures based ETFs.
• 3:54
  Speaker 2: So what do you do?
• 3:56
  Speaker 3: I obviously can't speak beyond what's in the filing, but
• 3:58
  Speaker 3: what the filing shows is we're converting those strategies to
• 4:02
  Speaker 3: rotate between let's say bitcoin and treasuries. So if the
• 4:07
  Speaker 3: market is in a positive momentum period where bitcoin's price
• 4:10
  Speaker 3: is rising and the ten day moving average is above
• 4:13
  Speaker 3: the twenty, they'll be in bitcoin, and otherwise they'll be
• 4:16
  Speaker 3: in treasuries. If the market is falling. I would just say,
• 4:19
  Speaker 3: you know, momentum is the most established factor in all
• 4:22
  Speaker 3: asset classes, in stocks, in bonds, in real estate, and commodities,
• 4:27
  Speaker 3: and indeed in crypto. There's a big academic literature on that,
• 4:31
  Speaker 3: and so we're just trying to offer a new strategy
• 4:34
  Speaker 3: that captures that momentum aspect for people who are worried
• 4:38
  Speaker 3: about those big pullbacks in crypto, which you know, quite
• 4:41
  Speaker 3: honestly is a lot of us. So I think this
• 4:44
  Speaker 3: idea is to rotate out when the markets are in
• 4:47
  Speaker 3: that position.
• 4:49
  Speaker 1: It'll be interesting to see this because we see it
• 4:50
  Speaker 1: a lot in just in the crypto investors that watch
• 4:53
  Speaker 1: our shows. They have kind of that built into their
• 4:55
  Speaker 1: portfolio right now, so it'd be good to see structured
• 4:58
  Speaker 1: campal kind of coming into this. I want to hit
• 5:01
  Speaker 1: on the point of the news this week, of course,
• 5:04
  Speaker 1: just yesterday believe it was you guys going into officially
• 5:07
  Speaker 1: filing for an XRP ETF. More around just the topic
• 5:11
  Speaker 1: of why XRP as the next ETF because many people
• 5:15
  Speaker 1: are looking at all kinds of different assets, especially in
• 5:17
  Speaker 1: the digital sphere. Why XRP.
• 5:21
  Speaker 3: Yeah, absolutely again, can't talk to the specific filing but
• 5:24
  Speaker 3: can talk to XRP in general. You know, first, I
• 5:28
  Speaker 3: think you've probably heard me say this. We're in the
• 5:30
  Speaker 3: ETF era of crypto, so I think they're going to
• 5:32
  Speaker 3: be ETFs on a wide variety of ETPs. XRP specifically,
• 5:38
  Speaker 3: you know, it has a very vibrant community. It's been
• 5:41
  Speaker 3: around for many years and sustained that community. It has
• 5:45
  Speaker 3: a novel consensus approach that's been working at you know,
• 5:49
  Speaker 3: low inflation rates, and it has interesting and evolving use cases.
• 5:54
  Speaker 3: My general view on crypto, like I'm an index investor
• 5:57
  Speaker 3: at heart, right, I come from the sort of index
• 6:00
  Speaker 3: investing side. My general review is we are still in
• 6:03
  Speaker 3: the early stages of crypto and no one knows exactly
• 6:07
  Speaker 3: how it will play out, and so we want to
• 6:09
  Speaker 3: offer investors access to a wide variety of assets. XRP
• 6:13
  Speaker 3: is one with a strong community and a strong track
• 6:15
  Speaker 3: record and a strong history. There are people with positive views,
• 6:18
  Speaker 3: there are people with negative views.
• 6:20
  Speaker 2: We understand that.
• 6:21
  Speaker 3: But just if we can structure a low cost, secure
• 6:24
  Speaker 3: way to access that, we think that's an improvement for
• 6:26
  Speaker 3: the market.
• 6:28
  Speaker 1: Well, and they you know, you look at just the
• 6:30
  Speaker 1: news that has been going on with Ripple and XRP
• 6:34
  Speaker 1: beyond the sec you know scenario, really what they've done
• 6:38
  Speaker 1: from a technology standpoint, but also from a strategy standpoint.
• 6:42
  Speaker 1: A lot of things happening right now. So that's a big,
• 6:44
  Speaker 1: big kudo for them.
• 6:47
  Speaker 3: I think that's right, and I think people overlook that.
• 6:49
  Speaker 3: They forget that these established platforms have very smart business
• 6:53
  Speaker 3: development people that are working every day to find new
• 6:55
  Speaker 3: applications and whether you're talking about you know, rolling out
• 6:59
  Speaker 3: stable coins, a partnership with leading financial firms, you know,
• 7:03
  Speaker 3: there is a lot to point to on the business
• 7:05
  Speaker 3: development side in terms of what's going on in the
• 7:08
  Speaker 3: XRP or Ripple community, and I think maybe it doesn't
• 7:11
  Speaker 3: get fully reported.
• 7:13
  Speaker 2: So we're excited about that.
• 7:15
  Speaker 1: Yeah, well, I mean we report on it quite a bit.
• 7:17
  Speaker 1: There has been a just a slew of news coming
• 7:20
  Speaker 1: out prior to the swell event. I imagine there will
• 7:22
  Speaker 1: be a lot of announcements next week. I think it
• 7:25
  Speaker 1: is when XRPN, Ripple are here in Miami talking about
• 7:28
  Speaker 1: the next step for them, including stable coins, all sorts
• 7:32
  Speaker 1: of things that are happening. I was looking at you
• 7:35
  Speaker 1: the bit wise website here and I was looking at
• 7:38
  Speaker 1: some of the weighted investments that you guys have in
• 7:41
  Speaker 1: the holdings and bitcoin ethereum, salt, most of these are expected,
• 7:45
  Speaker 1: but XRP holding in right there at one point eight,
• 7:48
  Speaker 1: which is significantly higher that a lot of these other
• 7:51
  Speaker 1: really blue chip assets in digital assets. Why do you
• 7:56
  Speaker 1: think we're seeing institutional more interest, I guess in XRP.
• 8:02
  Speaker 1: It's an interesting point that it's the number four position
• 8:05
  Speaker 1: right there within you guys.
• 8:07
  Speaker 3: Yeah, I know if you sort of abstract out and
• 8:10
  Speaker 3: think about crypto big picture, it's introducing two things into
• 8:13
  Speaker 3: the world. It's introducing sort of public money and permissionless finance,
• 8:18
  Speaker 3: and it's introducing public compute and smart contracts, and those
• 8:22
  Speaker 3: are both really big breakthroughs, and XRP is interesting. And
• 8:26
  Speaker 3: then it has aspects of the public money side and
• 8:29
  Speaker 3: also increasingly assets access of these sort of smart contracting
• 8:35
  Speaker 3: style applications. I know it's not fully there, but it
• 8:39
  Speaker 3: offers a legitimate shot on goal on those two big
• 8:42
  Speaker 3: new introductions, and I think that's the reason it's been
• 8:45
  Speaker 3: a sustained asset, and that's the reason you see the
• 8:48
  Speaker 3: market capitalization, which is of course the reason that you
• 8:51
  Speaker 3: see it high up the list, right It's been around
• 8:54
  Speaker 3: and it's had staying you know, staying power. I would
• 8:58
  Speaker 3: note there are a lot of crypto assets that have
• 9:01
  Speaker 3: been around and are no longer in that position on
• 9:04
  Speaker 3: the list, right, some of the og crypto assets, they
• 9:07
  Speaker 3: all haven't sustained that interest to this day. And XRP
• 9:11
  Speaker 3: is one that has, right, Yeah, more so than other
• 9:14
  Speaker 3: assets you might point to.
• 9:16
  Speaker 1: Well, and I look at it from an investor standpoint,
• 9:19
  Speaker 1: diversity and really taking a look at your balancing of
• 9:22
  Speaker 1: the portfolios. These days, we talk to a lot of
• 9:24
  Speaker 1: fund managers, both for retail capital but also in some
• 9:28
  Speaker 1: of the professional spaces, and one of the things that
• 9:31
  Speaker 1: I'm hearing more and more from those fund managers is
• 9:33
  Speaker 1: they're looking at the diversity that they can get into
• 9:37
  Speaker 1: these ETFs that are kind of a little bit of everything.
• 9:39
  Speaker 1: Are you finding that to be the case right now?
• 9:42
  Speaker 1: Because you've got bitcoin, you've got ethereum, potentially we get
• 9:45
  Speaker 1: an XRP etf. There's a lot of opportunities out here.
• 9:48
  Speaker 1: What are you finding the investors kind of doing?
• 9:52
  Speaker 3: You know, I think that's exactly right. The funny thing
• 9:54
  Speaker 3: about crypto is it's one of the only markets where
• 9:57
  Speaker 3: people are still primarily focused on single exposures. If you
• 10:01
  Speaker 3: look at the equity market, or you look at the
• 10:03
  Speaker 3: bond market, no one's buying one stock, They're buying a
• 10:06
  Speaker 3: basket of stocks. No one's buying one bond, they're buying
• 10:08
  Speaker 3: an etf of bonds. Our view is that the same
• 10:11
  Speaker 3: is going to be true in the crypto market. As
• 10:13
  Speaker 3: you move from primarily retail to primary institutional capital, they're
• 10:18
  Speaker 3: going to want diversified exposure.
• 10:20
  Speaker 2: That's the way.
• 10:21
  Speaker 3: Institutions invest, that's what they're taught in school, that's what
• 10:25
  Speaker 3: they're taught in their careers, and that's a dominant paradigm.
• 10:28
  Speaker 3: So I think you're going to see more of these
• 10:31
  Speaker 3: diversified exposures, more of people wanting to make a bet
• 10:34
  Speaker 3: on crypto and not make a bet on you know,
• 10:37
  Speaker 3: bitcoin individually or ethereum individually. Let's just make a bet
• 10:41
  Speaker 3: that crypto and public blockchains are going to be more
• 10:44
  Speaker 3: important in ten years than they are today. That's a
• 10:47
  Speaker 3: bet I have very high confidence in. And the way
• 10:50
  Speaker 3: you would express that is a diversified portfolio.
• 10:54
  Speaker 1: Well that's you know, it's kind of the mantra of
• 10:56
  Speaker 1: our channel. We talk so much on sure we talk bitcoin,
• 11:00
  Speaker 1: we'll get into a lot of the blue chip all coins,
• 11:02
  Speaker 1: we get into the Web three gaming space quite a bit,
• 11:04
  Speaker 1: mainly because that very point is the diversity of not
• 11:08
  Speaker 1: only the asset class, but also the potential opportunity within
• 11:11
  Speaker 1: all these sectors to grow based on all sorts of variations.
• 11:15
  Speaker 1: I mean, you've got things from a global standpoint that
• 11:18
  Speaker 1: are impacting many of these all that, so I think
• 11:20
  Speaker 1: you guys are on the right track. I wanted to
• 11:22
  Speaker 1: get your opinion on something. This was Eleanor Terrett coming
• 11:25
  Speaker 1: over Fox Business and she made some statements here that
• 11:28
  Speaker 1: I thought were interesting around this. The SEC, of course,
• 11:31
  Speaker 1: has not filed its Form C with second Circuit. This
• 11:34
  Speaker 1: is in reference to the appeal, so they need to
• 11:36
  Speaker 1: do this pretty fast, so Ripple kind of knows how
• 11:38
  Speaker 1: to proceed. They also have fourteen days from to day
• 11:41
  Speaker 1: to file across appeal if they choose to do so.
• 11:43
  Speaker 1: I'm just kind of curious. Do you think that we
• 11:46
  Speaker 1: could see a scenario because this seems like a little
• 11:49
  Speaker 1: bit of a chess match right now between the SEC
• 11:51
  Speaker 1: and Ripple. Do you think that maybe the SEC could
• 11:55
  Speaker 1: just say simply say we're going to drop this appeal.
• 11:58
  Speaker 3: Oh wow, that would that would be interesting. I mean,
• 12:02
  Speaker 3: of course, anything is possible, and I'm not a legal expert.
• 12:04
  Speaker 3: We'd have to talk to my general counsel. My view
• 12:07
  Speaker 3: is that there, you know, the SEC seems to be
• 12:11
  Speaker 3: moving down the pathway of appealing this, but we will
• 12:14
  Speaker 3: see at the end of the day. What I've focused
• 12:16
  Speaker 3: on from a legal perspective is that, you know, crypto
• 12:19
  Speaker 3: has done exceptionally well when challenged by the SEC in
• 12:23
  Speaker 3: court on major cases. I think Ripple is probably the
• 12:27
  Speaker 3: most well known example of that, but there have been
• 12:29
  Speaker 3: multiple instances where the courts have found that the SEC
• 12:33
  Speaker 3: is overstepped and that the arguments that the crypto industry
• 12:37
  Speaker 3: has made are maybe more sound than are purported in.
• 12:41
  Speaker 2: The mainstream media.
• 12:42
  Speaker 3: They've a very good track record in court. I think
• 12:45
  Speaker 3: that's the case here, and so I don't know on
• 12:48
  Speaker 3: this appeal no appeal story, but I think Ripple has
• 12:51
  Speaker 3: made real progress in court against the SEC, and I
• 12:55
  Speaker 3: think they should feel good marching forward on that.
• 12:58
  Speaker 2: Well.
• 12:58
  Speaker 1: Listen, Jude Torres is probably going to have a field
• 13:01
  Speaker 1: day I think with this one. On our what we've
• 13:03
  Speaker 1: seen and we've reported on this and covered this, done
• 13:05
  Speaker 1: deep dives on this pretty extensively. It'll be an interesting
• 13:09
  Speaker 1: round of legal I guess hoops that will be dealing
• 13:15
  Speaker 1: with for a little while, so it's going to be
• 13:17
  Speaker 1: one to watch. I was looking at a tweet you
• 13:20
  Speaker 1: put out, we need to I think you're right on this.
• 13:22
  Speaker 1: I think we do need this. A polymarket on a
• 13:25
  Speaker 1: stable coin aum topping one trillion by the end of
• 13:28
  Speaker 1: twenty twenty six. Matt, that's uh, that's just two years.
• 13:32
  Speaker 1: That's two years away, man, A trillion, a trillion, Come on.
• 13:37
  Speaker 3: Give it.
• 13:37
  Speaker 2: I thought I thought about putting end it.
• 13:39
  Speaker 3: I thought about putting the end of twenty twenty five,
• 13:41
  Speaker 3: but I wanted to be conservative. Look, I think there
• 13:44
  Speaker 3: is a I think there's a major unlock coming in
• 13:47
  Speaker 3: the stable coin market. Stable Coins are a killer app
• 13:49
  Speaker 3: of crypto. They've gone, you know, from zero to one
• 13:52
  Speaker 3: hundred and fifty billion dollars without regulatory clarity. If you
• 13:57
  Speaker 3: listen to Congress, the thing they agree on most in
• 14:01
  Speaker 3: crypto on the Democrat and Republican side of the aisle
• 14:05
  Speaker 3: is stable coin legislation. I think the US wants stable coins.
• 14:09
  Speaker 3: It's a way to export the dollar, it's a way
• 14:11
  Speaker 3: to sell more treasury debt. It's a way to improve finance.
• 14:15
  Speaker 3: Big finance wants to get into stable coins. They're looking
• 14:18
  Speaker 3: at tether making more money than Goldman Sachs and saying
• 14:21
  Speaker 3: hold on, we want a piece of this pie. So
• 14:24
  Speaker 3: if you have Wall Street, Crypto and Congress all aligned,
• 14:29
  Speaker 3: I have a very high confidence that we're going to
• 14:31
  Speaker 3: see breakthrough stable coin legislation early in the new congressional season.
• 14:36
  Speaker 3: And if we do that, I think it's Katie bar Theador.
• 14:39
  Speaker 3: I think it's Bankham New York. I think it's JP Morgan,
• 14:42
  Speaker 3: I think it's Visa. I think it's every major And
• 14:45
  Speaker 3: so I think a trillion dollars in two years is
• 14:47
  Speaker 3: probably conservative. There's ten trillion dollars in money market funds.
• 14:53
  Speaker 3: Stable coins are going to be a better version of that.
• 14:55
  Speaker 3: There's so much dollar deposit, and that's just in the
• 14:59
  Speaker 3: un You go globally and you can access dollars. I
• 15:03
  Speaker 3: think a's trillion dollars is easy. So I would take
• 15:05
  Speaker 3: the pro side of that poly market if it opened,
• 15:08
  Speaker 3: and if the regulators let me invest in poly market like.
• 15:12
  Speaker 1: I like your betting style there, Matt, So I'm kind
• 15:18
  Speaker 1: of in with you now that you've convinced me on this,
• 15:20
  Speaker 1: I think you might be right. You look at the migration, though,
• 15:23
  Speaker 1: a couple of things are happening in the stable coin
• 15:26
  Speaker 1: markets in general. Tether, of course, you mentioned Coinbase is
• 15:29
  Speaker 1: going to be delisting non compliance stable coins coming up
• 15:32
  Speaker 1: in Europe as the MEKA deadline comes up. This is
• 15:34
  Speaker 1: the end of the year. Most likely that Tether will
• 15:37
  Speaker 1: not necessarily hit the mark around a lot of these scenarios,
• 15:41
  Speaker 1: especially within some of these exchanges. When you look at
• 15:44
  Speaker 1: Tether and you look at what's happening with USDC Circle,
• 15:49
  Speaker 1: I mean, what's the potential here of us seeing a
• 15:52
  Speaker 1: major landfall so to speak, windfall I should say, for
• 15:57
  Speaker 1: Tether or excuse me, for Circle, especially into twenty twenty five.
• 16:01
  Speaker 1: To your point, do you think once we get regulation
• 16:04
  Speaker 1: that maybe that's when Circle really gets a little bit
• 16:07
  Speaker 1: of move on the ball.
• 16:09
  Speaker 3: Yeah, I think I think that will help. I think
• 16:11
  Speaker 3: that that headline you showed from Europe is an example
• 16:14
  Speaker 3: of that kind of unlock. I think is more regulated
• 16:18
  Speaker 3: players want to interact with stable coins as opposed to
• 16:21
  Speaker 3: unregulated players. That biases towards Circle. I also think Circle
• 16:27
  Speaker 3: is going to face more competition from traditional firms getting
• 16:30
  Speaker 3: into the space from PayPal marching into the space, from
• 16:33
  Speaker 3: Revolute marching into the space.
• 16:36
  Speaker 2: But I'm very.
• 16:38
  Speaker 3: Bullish on USDC and its future. I also think that
• 16:42
  Speaker 3: the level of sort of competitive moat in the stable
• 16:45
  Speaker 3: coin space is probably going to get a lot smaller
• 16:48
  Speaker 3: as we get more regulation. You know, regulation substitutes for trust,
• 16:53
  Speaker 3: and so you can see new entities gain scale really fast.
• 16:57
  Speaker 3: And yeah, I think I think you could see a
• 17:00
  Speaker 3: lippening in the stable coin space. Look, I don't think
• 17:02
  Speaker 3: Tether is going away, incredible business, incredible footprint, particularly overseas.
• 17:07
  Speaker 3: But do I think USDC will gain share.
• 17:09
  Speaker 2: Yes?
• 17:09
  Speaker 3: Do I think regulated stable coins will become the dominant player.
• 17:12
  Speaker 2: Yes.
• 17:14
  Speaker 3: Is there a history in the crypto market of seeing
• 17:16
  Speaker 3: that shift from unregulated venues to regulated venues? Absolutely, look
• 17:21
  Speaker 3: at where trading takes place, right, So I think we're
• 17:25
  Speaker 3: going to see that same migration in the stable coin space.
• 17:27
  Speaker 3: I'm very bullish on Circle and on its competitors on
• 17:30
  Speaker 3: the more regulated side of stable coins.
• 17:33
  Speaker 2: Yeah.
• 17:33
  Speaker 1: Well, you've got a lot of things happening with PayPal,
• 17:36
  Speaker 1: of course, with their own stable coin. You've got of
• 17:39
  Speaker 1: course Ripple coming into the game. It looks like we'll
• 17:41
  Speaker 1: get that announcement soon, and then you think about just
• 17:45
  Speaker 1: the strategies of we haven't seen the banks really come
• 17:48
  Speaker 1: into this yet, so it's very possible we could see
• 17:50
  Speaker 1: some real moves there. So I would agree with you
• 17:53
  Speaker 1: that there's going to be a large influx, and to
• 17:56
  Speaker 1: your point, it's kind of the killer app of where
• 17:58
  Speaker 1: blockchain is going. Speaking of that killer apps, we always
• 18:02
  Speaker 1: cover the gaming space, the innovation in Web three, what
• 18:06
  Speaker 1: we're seeing in real world assets, A lot of it's
• 18:09
  Speaker 1: happening overseas. I'm looking at your top ten holdings right here,
• 18:14
  Speaker 1: which I would kind of consider I would call this
• 18:17
  Speaker 1: almost like the gaming portfolio. Let'm kind of zoom in
• 18:19
  Speaker 1: on that for everybody that's watching right there. You've got Shopify,
• 18:22
  Speaker 1: Meta in their roadblocks is in their Unity software, and
• 18:26
  Speaker 1: a few others. Why not some of these blockchain Web
• 18:31
  Speaker 1: three projects in here. There's a lot to be looking
• 18:35
  Speaker 1: at on the market. When can we see a big
• 18:37
  Speaker 1: guys fund for that?
• 18:39
  Speaker 2: I love that idea.
• 18:41
  Speaker 3: I think that's a great idea and I think it
• 18:44
  Speaker 3: really is, you know, sort of happening and exploding right now.
• 18:47
  Speaker 2: So kudos to you on the idea.
• 18:49
  Speaker 3: The thing about these ideas, which people forget is you know,
• 18:52
  Speaker 3: we all know that technologies go through this two wave
• 18:56
  Speaker 3: motion right where there's a hype cycle and then a
• 18:59
  Speaker 3: crash of despair and then the slope of enlightenment where
• 19:02
  Speaker 3: they really start going. And that's what I'm seeing in
• 19:05
  Speaker 3: the gaming space. We had, we had the hype cycle,
• 19:09
  Speaker 3: we have the slope, the pit of despair. But if
• 19:12
  Speaker 3: you look past the service and look at the numbers,
• 19:14
  Speaker 3: you're seeing real and substantial growth. If you look at
• 19:17
  Speaker 3: the pipeline of games coming into the space, it's very broad,
• 19:21
  Speaker 3: which suggests we're going to have winners. If you think
• 19:24
  Speaker 3: of the performance aspects of the underlying blockchains and the
• 19:28
  Speaker 3: throughput and low cost that's now enabled in them, you
• 19:31
  Speaker 3: can imagine the scale that you're going to get. So
• 19:34
  Speaker 3: I think I think you're looking at it at the
• 19:36
  Speaker 3: right point. You're like six to twelve months ahead of
• 19:39
  Speaker 3: where the market and the media coverage is because you're
• 19:42
  Speaker 3: starting to see traction. But people are stuck on the
• 19:45
  Speaker 3: old narrative that Web three gaming was a bust, and
• 19:49
  Speaker 3: that's just not what the data increasingly suggests.
• 19:52
  Speaker 1: Well, in what we do here, you know, we dive
• 19:54
  Speaker 1: into the tech quite a bit that's really the background
• 19:57
  Speaker 1: of our channel, and most when you look at what
• 20:01
  Speaker 1: the strategies are taking place in Silicon Valley, where that's
• 20:04
  Speaker 1: Microsoft Meta to a certain extent, and even if you
• 20:07
  Speaker 1: take a look at Sony and what they've been able
• 20:09
  Speaker 1: to do in a short period of time, a lot
• 20:11
  Speaker 1: of blockchain involvement. Even here recently, we've had off the
• 20:15
  Speaker 1: Grid start to launch now on Xbox, one of the
• 20:17
  Speaker 1: first marketplaces that we've seen that actually show an opportunity
• 20:22
  Speaker 1: for Web three gaming in traditional Web two outlets, especially
• 20:26
  Speaker 1: around some of these big markets. And if you see
• 20:28
  Speaker 1: what Meta is doing in terms of ARVR and XR,
• 20:32
  Speaker 1: it's just a natural evolution, I think is just going
• 20:35
  Speaker 1: to take place. So I think you're right, you're in
• 20:38
  Speaker 1: that early early stage. It's much like nineteen ninety six
• 20:41
  Speaker 1: of the Internet era when I was a young engineer
• 20:44
  Speaker 1: working in Microsoft. Nobody thought we were going to see
• 20:48
  Speaker 1: what we saw, of course in nineteen ninety nine and
• 20:50
  Speaker 1: then two thousand, but it's definitely happening, so much so
• 20:55
  Speaker 1: that you've got this happening right here in Japan, and
• 20:57
  Speaker 1: that is a Digital Minister of the Japanese government now
• 21:02
  Speaker 1: going head forward to web three and kind of the
• 21:05
  Speaker 1: future of where this technology is going. Here's my question
• 21:10
  Speaker 1: to you. Do you think Japan and Asia is just
• 21:14
  Speaker 1: that far ahead of US and they're going to explode
• 21:16
  Speaker 1: in terms of innovation and opportunity or can the US
• 21:20
  Speaker 1: catch up here?
• 21:22
  Speaker 2: That's a good question, you know.
• 21:26
  Speaker 3: Look, I never count out the US, is my general view.
• 21:30
  Speaker 3: We always get around to it eventually and then come
• 21:33
  Speaker 3: and play a significant role. Certainly you're seeing and the
• 21:36
  Speaker 3: regulatory environment here has pushed things overseas, and you're seeing
• 21:41
  Speaker 3: more excitement in Asia. I know a lot of people
• 21:45
  Speaker 3: came back from the Token twenty forty nine conference really
• 21:48
  Speaker 3: fired up about the opportunity abroad. You see things like
• 21:52
  Speaker 3: this news on Japan. You see Japan reconsidering taxation on
• 21:56
  Speaker 3: crypto assets. You certainly see a lot of Web three
• 21:59
  Speaker 3: activity over there. But can the US catch up? Of course,
• 22:02
  Speaker 3: we can catch up. I think we're close to a
• 22:05
  Speaker 3: sort of sea change in regulatory attitudes towards crypto and
• 22:08
  Speaker 3: Web three in the US. I think we're going to
• 22:10
  Speaker 3: see that in the coming year or two ahead, almost
• 22:13
  Speaker 3: regardless of what happens in the November election.
• 22:16
  Speaker 2: So could we catch back up? Absolutely?
• 22:19
  Speaker 3: But the beauty as an investor, as it almost doesn't matter.
• 22:23
  Speaker 3: Crypto is inherently global, the blockchains that underpin it are
• 22:27
  Speaker 3: inherently global, and you can benefit from that activity wherever
• 22:30
  Speaker 3: it takes place around the world. And the history of
• 22:33
  Speaker 3: crypto is sort of a history of different countries squeezing
• 22:37
  Speaker 3: it from a regulatory perspective and the balloon expanding in
• 22:40
  Speaker 3: another geography. I think we've seen some of that with
• 22:43
  Speaker 3: the US versus Asia, which you're referencing, But there is
• 22:47
  Speaker 3: always some place that it goes. There's always a release valve,
• 22:50
  Speaker 3: and I think that's sort of the core thing to
• 22:54
  Speaker 3: remember through all this.
• 22:55
  Speaker 1: Yeah, the market is quite different than it was in
• 22:58
  Speaker 1: the early two thousand when we saw the US pretty
• 23:00
  Speaker 1: much taking control of the birth of the Internet and
• 23:03
  Speaker 1: a lot of the e commerce and commerce that really
• 23:05
  Speaker 1: kind of burgeoned out of that. So it's going to
• 23:08
  Speaker 1: be interesting to see because this, I think is the
• 23:10
  Speaker 1: first time we've seen a level playing field globally around
• 23:14
  Speaker 1: a technology, and you could use AI in that space
• 23:17
  Speaker 1: as well as blockchain attack and where crypto is going
• 23:20
  Speaker 1: in both those, So I agree with you, I think
• 23:22
  Speaker 1: it's going to be an interesting one for sure. A
• 23:24
  Speaker 1: couple of last questions for you. One, I want to
• 23:27
  Speaker 1: talk a little bit about yield generation and if you
• 23:30
  Speaker 1: think about yield generation, especially on a fund that would
• 23:33
  Speaker 1: be on chain, similar to what Blackrock has been able
• 23:36
  Speaker 1: to do with securitize, what's the likelihood of bit wise
• 23:40
  Speaker 1: doing something like that.
• 23:43
  Speaker 2: Yes, it's a great question.
• 23:44
  Speaker 3: Without giving away our product roadmap to all my fund
• 23:48
  Speaker 3: competitors out there who I love, I will say that
• 23:51
  Speaker 3: on chain solutions is something that we're looking at very
• 23:54
  Speaker 3: deeply at bit wise. You're seeing that market grow in
• 23:57
  Speaker 3: a substantial format, mostly with traditional finance players coming in.
• 24:02
  Speaker 3: We think there is space for more cryptonative firms that
• 24:04
  Speaker 3: can bridge those two.
• 24:06
  Speaker 2: To fill that role.
• 24:07
  Speaker 3: So, short of just telling you exactly what we plan
• 24:10
  Speaker 3: to do, the short answer is yes, I think that
• 24:14
  Speaker 3: market is right at a major growth point and bitwise
• 24:18
  Speaker 3: wants to be a player in both traditional financial products
• 24:22
  Speaker 3: and on chain financial products, and I think you'll see
• 24:24
  Speaker 3: us do some of that in the near future.
• 24:26
  Speaker 2: Yeah.
• 24:26
  Speaker 1: I mean, it seems like the appetite is there from
• 24:29
  Speaker 1: the investment community, so it just seems like a natural
• 24:32
  Speaker 1: evolution going forward. Last point is legislation policies, we've kind
• 24:36
  Speaker 1: of sprinkled it through here. We've got a stable coin
• 24:39
  Speaker 1: bill coming through, We've got the FIT twenty one bill
• 24:42
  Speaker 1: potentially in a Market Structure Act coming through. Likelihood of
• 24:47
  Speaker 1: those actually going through. I know you feel like stable
• 24:49
  Speaker 1: coin is going to be the number one right now,
• 24:51
  Speaker 1: at least in terms of getting I think.
• 24:52
  Speaker 3: Stable coin will be number one. Yes, yeah, the US
• 24:56
  Speaker 3: is incentive to do that, right, even from a traditional
• 24:59
  Speaker 3: finance person, even if you dislike crypto, because it exports
• 25:03
  Speaker 3: the dollar and helps us sell our debt, which is
• 25:07
  Speaker 3: a win win. But look, my big picture is that
• 25:10
  Speaker 3: mostly Washington's hostile attitude to crypto has passed its sell
• 25:15
  Speaker 3: by date. And you can see this in things like
• 25:18
  Speaker 3: the SEC not repealing SAB one twenty one but letting
• 25:22
  Speaker 3: Bony move into the custody space. You can see it
• 25:24
  Speaker 3: maybe in the resignation of the Director of Enforcement at
• 25:29
  Speaker 3: the SEC. You can see it in the bipartisan legislation.
• 25:33
  Speaker 3: You can see it even in the speed of the
• 25:35
  Speaker 3: ETF approval. The logjam is breaking up. I think whatever
• 25:40
  Speaker 3: happens in the November election will be sort of the
• 25:43
  Speaker 3: excuse to turn the page from a hostile approach to
• 25:47
  Speaker 3: a more neutral approach. I'm pretty optimistic about that. I
• 25:50
  Speaker 3: see that in the tea leaves. There's no guarantee that
• 25:53
  Speaker 3: will continue, but that is the trend. Those are real facts,
• 25:56
  Speaker 3: real things that happen that all point in a very
• 25:59
  Speaker 3: positive direction. And I think if we can use the
• 26:02
  Speaker 3: November election as a reason to turn the page, we
• 26:05
  Speaker 3: get a very fundamentally different outlook in the other head.
• 26:08
  Speaker 1: Well, listen, if you're in crypto, we always are looking
• 26:12
  Speaker 1: out for these rug pulls, and sometimes I look at
• 26:15
  Speaker 1: at something in the legislative front, I think, oh, this
• 26:18
  Speaker 1: is is feeling too good right now. I'm worried. You know,
• 26:21
  Speaker 1: It's like the minute you think something's going to happen,
• 26:23
  Speaker 1: do you feel like, either way, whatever way the election falls,
• 26:28
  Speaker 1: that we're we potentially have an opportunity here.
• 26:31
  Speaker 3: Yeah, a little Charlie Brown attitude on that, but yeah,
• 26:35
  Speaker 3: I definitely, I definitely think. Look, I do think it's
• 26:37
  Speaker 3: moving in a positive direction. There will be differences and
• 26:41
  Speaker 3: there are things to worry about in the stable coin
• 26:43
  Speaker 3: blue Is there a pathway to allow interest to crew
• 26:46
  Speaker 3: on stable coins sit separate just for the big banks,
• 26:50
  Speaker 3: or can smaller players innovate in that space. There is
• 26:53
  Speaker 3: of course differences in degree, but I think it is
• 26:56
  Speaker 3: from you know, like freezing to decent or freezing to warm.
• 27:02
  Speaker 3: I think that's the question, is it decent.
• 27:04
  Speaker 2: Or is it warm?
• 27:06
  Speaker 3: And either way it's better than what we have today.
• 27:09
  Speaker 3: But there are certainly things to look out for as
• 27:12
  Speaker 3: we move forward.
• 27:13
  Speaker 1: Yeah, well, we're definitely waiting for the sunny in Miami
• 27:15
  Speaker 1: days then where this is coming for sure. Matt Hogan,
• 27:19
  Speaker 1: it's been great having you on. Thanks for coming in today.
• 27:21
  Speaker 1: I know you have a very busy schedule with everything
• 27:24
  Speaker 1: you guys have been doing, so we do appreciate the time.
• 27:27
  Speaker 2: Thanks for having me. This was a lot of fun.
• 27:29
  Speaker 1: Excellent, excellent. All right, you guys are tuned in maybe
• 27:32
  Speaker 1: on the podcast side of things right now, make sure
• 27:34
  Speaker 1: and come over here on the YouTube channel. You get
• 27:35
  Speaker 1: all the goodies over here, And of course one of
• 27:37
  Speaker 1: the things you can do is jump into our Diamond Circle.
• 27:40
  Speaker 1: That's our own private member group. It's where we do
• 27:42
  Speaker 1: additional content, additional analysis, more interviews, all that kind of stuff.
• 27:46
  Speaker 1: We always leave a link down below, so check that out.
• 27:48
  Speaker 1: And of course you can catch me out there on
• 27:50
  Speaker 1: X at Paul Barron. We'll catch you next time, right
• 27:52
  Speaker 1: here on tech Path