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Speaker 1: Welcome to the Fear and Greed business Interview. I'm Sean Alma.

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Speaker 1: Sophisticated investors are moving into cryptocurrency, with trading volumes suggesting

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Speaker 1: established investors and now shaping the future of digital assets.

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Speaker 1: That's a sharp shift away from the small retail investors

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Speaker 1: that typified the early crypto boom. The third annual Investor

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Speaker 1: Study report from Australian cryptocurrency exchange BTC Markets also suggests

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Speaker 1: female investors and older investors are accessing cryptocurrency in greater

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Speaker 1: numbers as the market matures. Remember this is general information

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Speaker 1: only and you should always seek professional advice before making

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Speaker 1: investment decisions. Caroline Abowler is the chief executive officer of

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Speaker 1: BTC Markets. Caroline, welcome to Fear and Greed.

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Speaker 2: Thanks so much for having me.

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Speaker 1: So what is going on with the sophisticated investors pushing well,

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Speaker 1: not pushing out retail investors. I'm sure they're still there,

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Speaker 1: but getting more interested in crypto.

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Speaker 3: Yes, So what we've seen is the likes of smsfs,

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Speaker 3: trusts and other kind of non retail investors are coming

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Speaker 3: into cryptocurrency in a way that they haven't before. We

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Speaker 3: know there's about a billion dollars according to the ato

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Speaker 3: held by smsfs in cryptocurrency, which is obviously an improvement

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Speaker 3: year on year. But what we've seen too is not

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Speaker 3: just that they're coming in in greater number, but they're

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Speaker 3: also in greater deposit size. So this is where it's interesting.

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Speaker 3: They're exhibiting what I would classify as you know, standard

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Speaker 3: issue SMSF behavior. They're coming in with larger trade volume,

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Speaker 3: but they're trading less frequently, so they're coming in whereas

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Speaker 3: your average retailers say, perhaps they're coming in with, you know,

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Speaker 3: one thousand dollars deposits, but they trade that on a

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Speaker 3: regular basis. Instead, these guys are coming in with a

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Speaker 3: longly held position.

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Speaker 2: I'ously maybe you know.

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Speaker 3: Ten thousand dollars worth of bitcoin and they're holding up

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Speaker 3: for a longer period of time rather than trading it

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Speaker 3: in and out. In many ways, actually that mirrors the

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Speaker 3: behavior that we've seen from female investors traditionally as well,

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Speaker 3: that they tend to buy and hold. They don't come

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Speaker 3: in to trade with the same volume that men do.

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Speaker 3: That they come in and they buy and they hold.

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Speaker 3: They hold larger positions. But that's what we've seen with

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Speaker 3: SMSs and trust and the like coming onto the platform.

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Speaker 1: Okay, so I suppose it's not that much of a

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Speaker 1: surprise that smsfs are buying greater amounts and holding them

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Speaker 1: for longer. The idea with a superannuation fund, of course,

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Speaker 1: is that you're saving for retirement. It's not a trading platform.

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Speaker 1: Are there any restrictions on how smsfs can buy cryptos

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Speaker 1: hohold cryptos, that type of thing that might be restraining

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Speaker 1: the amount or the time held.

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Speaker 3: Yeah, I don't believe that there are specific restrictions on

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Speaker 3: smsfs in general. I think that there are obviously restrictions

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Speaker 3: based on how the SMSF itself has sat up and

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Speaker 3: the kind of particular to that particular fund, But more broadly,

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Speaker 3: I don't think that there are issues. What we have found, though,

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Speaker 3: is that there seems to be coalescence around certain assets

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Speaker 3: seem to the most popular, and they've kind of fallen

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Speaker 3: lockstep with the majority of the industry or a majority of.

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Speaker 2: People who are training and buying.

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Speaker 3: Bitcoin is the number one most popular asset for SIM,

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Speaker 3: which makes sense as well. It does fit rather well

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Speaker 3: with the thesis of as you say, that longer term

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Speaker 3: investment profile.

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Speaker 2: Bitcoin certainly matches up with that.

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Speaker 3: But they're also interested in Ethereum, which is probably the

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Speaker 3: better known utility platform.

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Speaker 2: It's supposed to be.

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Speaker 3: Kind of how the blockchain economy is going to be

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Speaker 3: built is going to be on the Ethereum ecosystem. But

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Speaker 3: alongside that, then there's like the Salana that have come through,

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Speaker 3: particularly over the last twelve months, which are which is

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Speaker 3: kind of known as a pretender to the Ethereum crown.

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Speaker 3: It's another one of those unity platforms that's been coming

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Speaker 3: along and doing very well. So there isn't a huge

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Speaker 3: amount of variety per se that they are sticking with

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Speaker 3: what we would classify as large cap crypto in if

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Speaker 3: you use traditional language, but the fact that they're coming

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Speaker 3: in is really significant. As to say the eighty I

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Speaker 3: reckon they've got about a dollars in Australia held up

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Speaker 3: in crypto for myself.

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Speaker 1: Okay, what about retail investors in crypto? Have they decreased

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Speaker 1: the amount that they're trading or is it just that

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Speaker 1: there's the big of shaer is coming through ass and others.

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Speaker 3: Yeah, I think we've seen we've seen a change in

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Speaker 3: the in the retail behavior and certainly even along gender lines,

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Speaker 3: we can see the changes. Men tend to be far

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Speaker 3: more active in general in a ballmarket pair back of

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Speaker 3: their behavior and in the bear cycle that we've seen,

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Speaker 3: whereas in fact we've seen that women probably skew differently

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Speaker 3: in that sense that the women are actually less busy

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Speaker 3: in the ball and busier in the bear. But what

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Speaker 3: we have found is that women traders in crypto or

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Speaker 3: women investors in crypto, their portfolio performs better in a

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Speaker 3: bear than it does in a ball. And I think

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Speaker 3: that the probably again possibly mirrors what we see in

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Speaker 3: traditional markets in terms of the risk profiles stacking up

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Speaker 3: between the two genders, and sometimes those stereotypes are there verias.

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Speaker 2: And certain we've seen that.

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Speaker 3: So what we've seen, as I say, is there's definitely

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Speaker 3: been a pair back in the number of trades that

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Speaker 3: we've seen coming through for retail and non retail. But

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Speaker 3: that is a trajectory that we anticipate is going to

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Speaker 3: shift as we move into the next calendar year.

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Speaker 2: In particular.

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Speaker 1: Okay, so in terms of volumes, I get that the

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Speaker 1: sizes are larger, but total trade volume there was a

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Speaker 1: big jump last year, wasn't there. In certainly through your platform.

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Speaker 2: Yeah, absolutely so. We saw.

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Speaker 3: Many people had called it the return of the bull

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Speaker 3: or suddenly they're getting you know, that they we'd move

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Speaker 3: past the bear. I don't necessarily know that we had

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Speaker 3: moved out of a bear market per se. We did

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Speaker 3: see a change, a positive change in the price of

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Speaker 3: bitcoin that was led by the ETF announcements coming out

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Speaker 3: of the United States. But do I think that the

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Speaker 3: investor sentiment shifted hugely, No, I don't. I don't think

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Speaker 3: that retail felt like they could come back in yet

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Speaker 3: in large, in large, and certainly although we did see

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Speaker 3: the year on year improvement, we're definitely haven't been back

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Speaker 3: into that phone met trade, that ball trade. But we

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Speaker 3: were coming off the back of a particularly prolonged and

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Speaker 3: particularly pronounced bear market. Where it was it was very

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Speaker 3: very low in terms of trading volume. But thankfully we

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Speaker 3: did we turned that corner. But to be fair, I

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Speaker 3: don't think we're going to see a return to to

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Speaker 3: buoyancy in the markets until kind of the tail end

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Speaker 3: of this into next year. And that's as much to

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Speaker 3: do with the liquidity that's out in the market, as

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Speaker 3: you know, global macro issues that are playing more so

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Speaker 3: than just specific to cryptocurrency.

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Speaker 1: To stay with me, Caroline. We'll be back in a minute.

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Speaker 1: I guess today is Caroline Bowlt, CEO of BTC Markets.

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Speaker 1: We talked about the bitcoin halving of it. I think

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Speaker 1: it was the fourth bitcoin halving of it. Did they

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Speaker 1: actually have an impact on the market, Yeah.

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Speaker 2: It does. There always tends to be in the build

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Speaker 2: up to it.

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Speaker 3: We see the wrap up the price of bitcoin, and

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Speaker 3: I think there's kind of this expectation that, oh, you know,

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Speaker 3: the flood lates are now open, we've had the having.

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Speaker 3: We tend to see the impact of that come six

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Speaker 3: months post having or the following. You know, that kind

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Speaker 3: of time frame seems to you when the shift happens,

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Speaker 3: and there's always this talk of oh, you know, not always,

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Speaker 3: but there is generally a conversation then around oh is

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Speaker 3: this going to be the having where the wheels fall

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Speaker 3: off or or and that just hasn't happened. We haven't

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Speaker 3: seen that that happen, and I think at this point,

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Speaker 3: given how many times we've gone through this experience as

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Speaker 3: an industry, I think it's relatively safe to assume that

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Speaker 3: that's not going to be the case. That the technology

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Speaker 3: is working as it should do. But certainly I think

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Speaker 3: that in prior cycles, because the having event was considered

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Speaker 3: so novel, there was probably a lot more hype around

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Speaker 3: what was transpiring. Now at this point, as you say,

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Speaker 3: we've gone through four of these instances, the world has changed,

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Speaker 3: the macro conversations has changed, the expectation around bitcoin has changed.

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Speaker 3: I think the industry with the value rather of the

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Speaker 3: bitcoin is kind of have priced all of this in already,

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Speaker 3: and certainly we see that when it comes to bitcoin havings.

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Speaker 1: Has the industry, the crypto industry matured enough to say

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Speaker 1: that there are now three, four, five, six primary cryptocurrencies

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Speaker 1: and the meme stocks in the meme events has been

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Speaker 1: way of putting it or a thing of yesteryear, and

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Speaker 1: investors are just focused on a bunch of more mature

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Speaker 1: currencies or not.

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Speaker 3: I think that there is absolutely a market for meme

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Speaker 3: tokens in the same way that there's always a market

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Speaker 3: for penny stocks. There'll always be a market, I think

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Speaker 3: for memes in the industry, and I think that there

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Speaker 3: are people out there who make money off of it

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Speaker 3: and do really well on their investments in those That's

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Speaker 3: not something that the beef markets that we focus on.

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Speaker 3: We don't tend to list those. We tend to, as

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Speaker 3: you described, look at projects that we feel have got

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Speaker 3: a longer term use case or you know, are they

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Speaker 3: going to be around longer, And you know, we don't

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Speaker 3: give any guarantees with that, but instead we look up

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Speaker 3: the white paper will conductor extensive due diligence around what

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Speaker 3: we list, because.

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Speaker 2: That's the platform that we are.

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Speaker 3: If you want to do the meme stocks, there are

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Speaker 3: plenty of other platforms for that, but this is what

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Speaker 3: we specifically kind of have focused on, and that's the

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Speaker 3: segment that we work with. To your point, you know,

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Speaker 3: if you look at the concentration within just bitcoin and ethereum,

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Speaker 3: they're you know, at any one point in times about

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Speaker 3: sixty percent of market caps in those two assets. So

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Speaker 3: you know, the market itself decides whether they think the

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Speaker 3: value is and where they think the long term is.

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Speaker 3: I know there's plenty of people who made money on memes,

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Speaker 3: and I know there's plenty of people who view them

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Speaker 3: as fun in the same way as I say the

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Speaker 3: penny stocks. They view them in the same way as

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Speaker 3: you know, they have a punt on them, and that's

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Speaker 3: an entirely valid viewpoint, it's just not what we do

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Speaker 3: for business.

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Speaker 1: Yeah, older investors. In your report, you also talk about

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Speaker 1: older investors they're increasingly open to cryptocurrencies.

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Speaker 3: Caroline, Yeah, absolutely, and I think that probably bucks the

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Speaker 3: trend of money's expectations that people kind of think it's

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Speaker 3: just twenty five year olds men in hoodies that are

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Speaker 3: into crypto currency, and that's just not the case. And

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Speaker 3: certainly we've found people who perhaps, you know, the way

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Speaker 3: that they view it may be different in the sense

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Speaker 3: that they look at it as they would other alternative investments.

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Speaker 3: We generally put, you know, between five to fifteen percent, say,

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Speaker 3: of your investment portfolio goes into those assets, and certainly

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Speaker 3: that's what we've seen kind of come through from that demographic.

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Speaker 3: But they have been coming into this market over the

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Speaker 3: last five years that we've been running this survey, in particular,

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Speaker 3: that they've been coming into this market, they've been investing

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Speaker 3: in it, and they're increasingly doing so.

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Speaker 2: They rather, like the rest of traditional.

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Speaker 3: Finance, what they hold in larger amounts, They have larger balances,

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Speaker 3: if you like, of cryptocurrency. They trade less frequently, again

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Speaker 3: than other age.

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Speaker 2: Groups, but that's exactly what you'd expect they've.

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Speaker 3: Already gone through the wealth accumulation stage than now on

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Speaker 3: the wealth protection stage, whereas the twenty five year olds

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Speaker 3: are trying to accumulate like mad, wearing their hoodies and

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Speaker 3: having a great time doing so.

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Speaker 2: And so they trade with far greater frequency.

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Speaker 3: But it's this this perception that cryptocurrency is you know,

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Speaker 3: elitist in some way, or that it's only for people

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Speaker 3: who can understand how to program a blockchain or or

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Speaker 3: any kind of like, you know, please supposition about.

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Speaker 2: What people supposed to be to do. It's just not the case.

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Speaker 2: It's just not true.

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Speaker 3: And this idea that just because you're older means that

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Speaker 3: you are incapable of doing some research into bitcoin again

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Speaker 3: is a falsehood that Australians are challenging every day.

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Speaker 2: Those falsehoods out there.

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Speaker 1: One last one and this is purely for me because

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Speaker 1: I never quite understand stable coins, the idea that it's

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Speaker 1: kind of over time, it's they're stable, they remaining in

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Speaker 1: a value. Where does that fit into the ecosystem and

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Speaker 1: is it a growing part of the ecosystem.

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Speaker 3: The single largest training over the last couple of years

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Speaker 3: has been in stable points, which I think says everything

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Speaker 3: about the direction that this is going in. Stable Coins

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Speaker 3: are used within the blockchain economy as we call it.

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Speaker 3: So when I talked about those businesses and organizations that

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Speaker 3: are building using the Ethereum Blockchainel Salana blockchain, for example, oftentime,

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Speaker 3: to access and pay for the services that are being

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Speaker 3: provided on those you can pay for them through stable coins.

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Speaker 3: And so what you could do, and I know very

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Speaker 3: much of examples where this has been the case, where

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Speaker 3: you want to send money to a friend, for example,

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Speaker 3: who lives overseas, or even for me, when I'm trying

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Speaker 3: to send money to my nephew for his birthday, I

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Speaker 3: can buy US dollar through each heather or USDC or

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Speaker 3: some other stable coin and send it to his cryptocurrency

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Speaker 3: account of his cryptos I'm talking about a hundred bucks.

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Speaker 3: I'm not talking about large numbers even to be concerning

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Speaker 3: anyone with putting, you know, a happy birthday kind of gift,

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Speaker 3: and that's across to him in a matter of seconds,

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Speaker 3: he can cash it out on the other side in

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Speaker 3: his Euro account. He can do the effects on that

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Speaker 3: side and he cashes that Euro. It's done incredibly quickly,

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Speaker 3: incredibly inexpens But you can send it anywhere in the

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Speaker 3: world and to anyone. And obviously there's amlky C checks

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Speaker 3: and so on. I mean, we'll just take that as

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Speaker 3: a given. But in terms of utility of something like

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Speaker 3: a stable coin, particularly if your currency isn't as strong

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Speaker 3: as the AUSI dollar or the euro and you're you know,

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Speaker 3: you need to try and hedge your currency exposure. Buying

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Speaker 3: into a stable coin is incredibly easy to do so.

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Speaker 3: And as I say, backtop by dollars on the other

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Speaker 3: side of it. So for every every one dollar of

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Speaker 3: a US dollar stable coin you buy, on the other

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Speaker 3: side of that is a dollar sitting in a bank

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Speaker 3: account or a trust or in.

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Speaker 2: T bills on the back of it. That's that's the

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Speaker 2: thesis behind it.

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Speaker 1: I think I understand it now.

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Speaker 2: Oh brilliant, Oh fantastic.

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Speaker 1: Thank you for talking to Fear and Greed this morning.

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Speaker 2: Thank you.

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Speaker 1: That was Caroline Bowler, chief executive of BTC Markets. This

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Speaker 1: is the Fear and Greed Business Interview. Remember this is

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Speaker 1: general information only, and you should see professional advice before

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Speaker 1: making investment decisions. Join us every morning for the full

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Speaker 1: episode of Fear and Greed Daily Business use for people

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Speaker 1: who make their own decisions. I'm sure I owed my

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Speaker 1: enjoy the day