WEBVTT - Current Groupthink of the Crypto Faithful 0:00:02.680 --> 0:00:05.760 This is Bloomberg Crypto, a daily Bloomberg I Heard podcast, 0:00:05.920 --> 0:00:08.720 and I'm Stacy Marie Ishmael, Managing editor of Crypto for 0:00:08.720 --> 0:00:25.560 Bloomberg News. It's Thursday, December eight. There's often in any 0:00:25.600 --> 0:00:30.000 financial market a reasonable amount of group think, sometimes known 0:00:30.040 --> 0:00:33.040 as the herd effect or maybe even a mob mentality. 0:00:33.520 --> 0:00:36.559 There's actually some really interesting research into this. You can 0:00:36.640 --> 0:00:39.839 check out the paper Bubbles, Human Judgment and Expert Opinion 0:00:39.880 --> 0:00:43.280 by Robert J. Schiller for more. Crypto investors are no 0:00:43.440 --> 0:00:46.720 exception to group think, and they're in group behavior comes 0:00:46.760 --> 0:00:50.720 with a lot of catch phrases like the famous GM 0:00:50.720 --> 0:00:53.920 and the infamous have fun staying poor, or the tongue 0:00:53.960 --> 0:00:56.720 in cheek that coin will fix this, where this is 0:00:56.760 --> 0:01:00.080 basically any social or economic issue you can imagine. In 0:01:00.080 --> 0:01:03.440 this episode with Bloomberg Senior editor Mike Gregen, common sense, 0:01:03.520 --> 0:01:08.120 but humans, uh, you know, traditionally aren't the best practitioners 0:01:08.120 --> 0:01:12.279 of common sense and Bloomberg reporter Emily Nicole's it seems crazy. 0:01:12.319 --> 0:01:14.600 Why would you store your money on an exchange where 0:01:14.640 --> 0:01:17.920 it's really difficult to get access to it or you 0:01:17.959 --> 0:01:19.840 don't own the rights to it, Like, isn't that bon 0:01:19.880 --> 0:01:22.880 because we'll tackle the mood among the crypto faithful and 0:01:22.920 --> 0:01:39.560 why some of them are now evangelizing cold wallets. Emily, 0:01:39.840 --> 0:01:42.720 you have written probably more than any of us on 0:01:42.760 --> 0:01:47.480 the team about the culture of crypto, and one of 0:01:47.520 --> 0:01:49.840 the elements of that I think is really reflected in 0:01:49.880 --> 0:01:53.600 the phrase not your keys, not your coins. For the 0:01:53.600 --> 0:01:57.160 people who don't obsessively compulsively read your newsletters on a 0:01:57.200 --> 0:02:02.080 regular basis, can you just explain what that means? So, 0:02:02.440 --> 0:02:05.400 not your keys, not your coins means that if you 0:02:05.480 --> 0:02:09.880 are storing your crypto with a third party online, typically 0:02:10.560 --> 0:02:12.600 there may be something in the terms of service that 0:02:12.720 --> 0:02:16.160 says that while your assets are with that provider, they 0:02:16.240 --> 0:02:18.680 actually own the rights to those assets and not you. 0:02:19.320 --> 0:02:23.320 And it's typically actually the most popular way that at 0:02:23.360 --> 0:02:26.840 least the terms of service act for many of the 0:02:26.919 --> 0:02:30.680 largest providers of crypto custody. So, if you think about 0:02:31.160 --> 0:02:34.920 platforms like Celsius that went by craft earlier this year, 0:02:35.440 --> 0:02:39.160 when you put your assets on Celsius, you didn't actually 0:02:39.160 --> 0:02:42.280 have any claim to those assets once they're in celsius possession, 0:02:42.639 --> 0:02:45.360 because that is how Celsius was able to do things 0:02:45.360 --> 0:02:47.360 with those assets once they had the rights or generate 0:02:47.400 --> 0:02:50.079 the yields for the loans that they were creating. But 0:02:50.280 --> 0:02:53.920 conversely as well, if you think about even the banks 0:02:53.960 --> 0:02:56.679 that offer crypto trading alpha some customers, like in the UK, 0:02:56.800 --> 0:02:59.440 we have an app called Revolute. It's also pretty big 0:02:59.440 --> 0:03:02.520 in Europe any assets that you buy with Revolute. So 0:03:02.520 --> 0:03:05.320 if you can buy bitcoin, you can buy ether. You're 0:03:05.360 --> 0:03:08.200 actually just putting your name attached to a bit of 0:03:08.320 --> 0:03:11.760 bitcoin in revolutes big bitcoin pile, and you don't own 0:03:11.800 --> 0:03:14.079 any rights to that. So it also makes it very 0:03:14.080 --> 0:03:15.920 difficult if you then want to be able to withdraw 0:03:15.960 --> 0:03:20.600 that bitcoin and take it somewhere else. Now, first of all, 0:03:20.960 --> 0:03:25.160 that seems wild in the sense that when you talk 0:03:25.320 --> 0:03:28.040 to crypto folks, and especially when you talk to people 0:03:28.080 --> 0:03:32.480 who describe themselves as bitcoin maximalists, the idea that you 0:03:32.520 --> 0:03:38.040 would knowingly willingly hand over, you know, the right to 0:03:38.480 --> 0:03:42.600 your crypto seems bonkers. But you know, Mike, something that 0:03:42.680 --> 0:03:46.320 you have addressed kind of similar to the idea of 0:03:46.920 --> 0:03:50.560 you know, culture, is kind of this idea of like convenience, Right, 0:03:50.880 --> 0:03:55.240 it is really hard actually to hold onto your own stuff, 0:03:55.960 --> 0:03:59.000 and so you've got people who are like one, surely 0:03:59.040 --> 0:04:02.520 they'll give me back if I ask demonstrates it not 0:04:02.600 --> 0:04:06.840 necessarily and too well, surely they're not doing anything nefarious 0:04:06.880 --> 0:04:11.160 with that. Also tvd SO, on the podcast that you 0:04:11.240 --> 0:04:13.680 host with vill Donna What Goes Up, you had a 0:04:13.720 --> 0:04:18.080 guest Leo Wold recently who started talking about cold wallets. Now, 0:04:18.240 --> 0:04:22.080 cold wallets emerged as this idea of Okay, people may 0:04:22.120 --> 0:04:25.040 do nefarious things, people may go bust, here's how to 0:04:25.120 --> 0:04:28.280 keep your keys safe. What is that like in practice? Well, 0:04:28.320 --> 0:04:30.960 you know, I think it gets to the heart of 0:04:31.040 --> 0:04:34.960 the fact that people trust the blockchain itself, especially with Bitcoin. 0:04:35.040 --> 0:04:39.120 They don't trust all these other intermediate mediaries who are 0:04:39.160 --> 0:04:43.000 working on top of the blockchain. And I think that's 0:04:43.040 --> 0:04:45.360 really a lesson that's come back home. You know. There 0:04:45.400 --> 0:04:48.640 seems to have been a complacency that had grown around 0:04:48.960 --> 0:04:51.520 the likes of a huge exchange like f t x 0:04:51.880 --> 0:04:54.880 H and all the others. And in practice, it's it's 0:04:54.920 --> 0:04:57.560 really getting back to that notion not your keys, not 0:04:57.720 --> 0:05:04.000 your coins. People want to hold these private keys somewhere 0:05:04.080 --> 0:05:07.400 safe offline. And if you look at the data, there's 0:05:07.400 --> 0:05:11.400 a website crypto quant that tracks a whole bunch of things. 0:05:11.400 --> 0:05:13.320 But one of the things I'm fascinated in is how 0:05:13.400 --> 0:05:18.720 much bitcoin is being withdrawn from exchanges and put presumably 0:05:18.760 --> 0:05:21.400 in cold storage. And in the middle of November, something 0:05:21.560 --> 0:05:24.080 like half a billion dollars worth of bitcoin a day, 0:05:24.160 --> 0:05:27.800 something like twenty nine thousand bitcoins a day, we're getting 0:05:27.839 --> 0:05:33.520 yanked off of exchanges. The problem though, is that, you know, 0:05:33.560 --> 0:05:35.640 you put those private keys on a hard drive, and 0:05:35.680 --> 0:05:40.480 we've all heard the hilariously sad stories of people losing 0:05:40.480 --> 0:05:43.479 their hard drive forgetting the passwords of their hard drive, 0:05:43.600 --> 0:05:44.880 or you know the one poor guy I think it 0:05:44.880 --> 0:05:47.360 was in Wales, we threw it out and was trying 0:05:47.400 --> 0:05:49.480 to bribe the people at the dump to let him 0:05:49.520 --> 0:05:52.440 go dig dig around for his hard drive because the 0:05:52.480 --> 0:05:54.440 value of the bitcoin had had gone up so much. 0:05:54.480 --> 0:05:57.880 So there are companies that offer this service as well. 0:05:57.920 --> 0:06:00.840 But I think you know, this emoil we've seen in 0:06:00.880 --> 0:06:04.440 the last month or so has really revived that whole 0:06:04.480 --> 0:06:08.400 notion of you wanted those private keys as close to 0:06:08.680 --> 0:06:12.200 possible and as safe a place as possible, and for 0:06:12.240 --> 0:06:14.560 many of that is simply on a hard drive that 0:06:14.600 --> 0:06:16.520 you can put in a safe, put in your closet, 0:06:16.600 --> 0:06:19.760 put wherever there's one. A few interesting ones have come 0:06:19.839 --> 0:06:22.400 out recently to regarding n f T s, there's now 0:06:22.480 --> 0:06:24.880 cold storage. While it's where you can store your n 0:06:24.880 --> 0:06:26.599 f T s but also show them off to your friends. 0:06:26.680 --> 0:06:29.279 It looks like a little iPhone, so you can sort 0:06:29.279 --> 0:06:32.240 of scroll through your n f T collection, but it's 0:06:32.279 --> 0:06:35.039 in cold storage, meaning it's not connected to the internet. 0:06:35.279 --> 0:06:37.200 No one can sort of reach in through the internet. 0:06:37.279 --> 0:06:39.720 Somebody could steal your little device. Someone could yeah where 0:06:39.760 --> 0:06:41.200 you could put it in the dump and and have 0:06:41.320 --> 0:06:45.280 to drive a trashman to get one of the things. 0:06:45.480 --> 0:06:49.200 I always remind people that, in addition to the joke 0:06:49.520 --> 0:06:51.159 that you know will kind of make where it's like 0:06:51.200 --> 0:06:55.120 ha ha, underlying technology crypto is also just tech, right, 0:06:55.240 --> 0:07:01.320 and so getting people to memorize passwords very different. Cold problem. 0:07:01.360 --> 0:07:05.680 Getting people to back up there are hard drives, very 0:07:05.720 --> 0:07:08.479 difficult problem. Like the number of people in my own 0:07:08.680 --> 0:07:13.560 family shout out to my family who are like, well, 0:07:13.600 --> 0:07:16.440 you know, I know you said to back up these files, 0:07:16.440 --> 0:07:18.440 but I didn't. Are they gone forever? And I'm like, 0:07:18.480 --> 0:07:21.560 oh my god, I could be a member of your family. 0:07:21.600 --> 0:07:24.520 I feel like, so you you layer on top of 0:07:24.680 --> 0:07:27.520 shall we say, the default stands of human beings which 0:07:27.560 --> 0:07:29.520 is not to do the right thing when it comes 0:07:29.560 --> 0:07:32.800 to tech because it's annoying. And then you say and 0:07:32.880 --> 0:07:36.360 make that potentially be worth tens of thousands, if not 0:07:36.520 --> 0:07:39.520 millions of dollars. How do we solve that tension? How 0:07:39.520 --> 0:07:42.360 are people trying to solve this tension? You know, I'm 0:07:42.400 --> 0:07:45.480 not sure you do. And I think what happens is um, 0:07:45.560 --> 0:07:48.160 you know, maybe you put your coins in cold storage 0:07:48.720 --> 0:07:53.880 when the coins at dollars ethereums at three thousand and 0:07:54.120 --> 0:07:56.960 prices collapse and then you kind of forget about them, 0:07:57.040 --> 0:07:59.400 you know, and then five years goes by, ten years 0:07:59.480 --> 0:08:01.520 go by, and a wait a minute, I I'm a 0:08:01.520 --> 0:08:04.560 bitcoin millionaire. Where is that hard drive? What is the password? 0:08:04.840 --> 0:08:06.880 So I think it's at your point, I think it's 0:08:06.960 --> 0:08:10.040 human nature. There is no simple, elegant solution for it 0:08:10.160 --> 0:08:12.320 other than the things you're talking about. You know, back 0:08:12.360 --> 0:08:15.480 it up, don't leave it somewhere in the sun, if 0:08:15.520 --> 0:08:19.840 it's a hard drive, if don't let your kids. Yeah, 0:08:19.880 --> 0:08:23.040 I mean it's common sense, but humans, uh, you know, 0:08:23.120 --> 0:08:27.040 traditionally aren't the best practitioners of common sense. So you know, 0:08:27.600 --> 0:08:29.000 the one thing I would say is that when a 0:08:29.040 --> 0:08:31.920 lot of these coins get moved off the exchanges. It 0:08:32.040 --> 0:08:34.480 used to be considered a very bullish thing, right, Oh, 0:08:34.559 --> 0:08:37.800 people are pulling them off the exchanges. That means well, 0:08:37.840 --> 0:08:39.640 at least they're not trying to sell them. If you 0:08:39.679 --> 0:08:43.480 see an influx of coins back onto exchanges, the thinking is, well, 0:08:43.480 --> 0:08:45.440 they're all getting ready to sell. But I think that 0:08:45.559 --> 0:08:47.960 signal might be broken at the moment. I don't think 0:08:48.000 --> 0:08:51.560 you can, you know, assume that because people are so 0:08:52.080 --> 0:08:55.679 paranoid about every company involved in crypto, that it's a 0:08:55.720 --> 0:08:58.880 bullish thing that they're they're moving their coins into cold storage. 0:08:58.920 --> 0:09:02.040 I think it's it's just survived at this point. And Emily, 0:09:02.400 --> 0:09:06.640 you know, you pay a lot of attention to shall 0:09:06.679 --> 0:09:11.560 we say, the sentiment negative or positive of folks in 0:09:11.640 --> 0:09:15.920 and around crypto, not just institutional investors, but also you know, 0:09:15.960 --> 0:09:19.319 like retail investors on crypto Twitter. What have you observed 0:09:19.840 --> 0:09:23.520 to Reagan's point about what folks are doing. I think 0:09:23.559 --> 0:09:25.360 the one thing that stood out to me a lot 0:09:25.520 --> 0:09:29.840 is that in this particular cycle of people moving money 0:09:29.920 --> 0:09:33.760 back and forth between like cold wallets or online exchange wallets, 0:09:33.760 --> 0:09:38.520 hot wallets, is that during this period of tumult a 0:09:38.559 --> 0:09:43.120 lot of the typical resort um last resort for crypto 0:09:43.160 --> 0:09:45.400 investors is that it's time to build it. Is what 0:09:45.480 --> 0:09:47.880 you hear a lot of companies say during this time 0:09:47.960 --> 0:09:50.199 is that okay, well, okay, no one's trading and everyone's 0:09:50.200 --> 0:09:52.559 moving their coins off the exchange. Is there's time to 0:09:52.679 --> 0:09:54.760 figure out how to build something coolse they come back 0:09:55.480 --> 0:09:58.400 and in that one of the top things is how 0:09:58.400 --> 0:10:01.439 do we make it easier for p or to interact 0:10:01.480 --> 0:10:03.920 with things like cold wallets or interact with things that 0:10:04.080 --> 0:10:07.200 there are on exchanges, because it's like, at the beginning 0:10:07.200 --> 0:10:10.640 of this episode, we said, it seems crazy. Why would 0:10:10.720 --> 0:10:13.000 you store your money on an exchange where it's really 0:10:13.040 --> 0:10:16.320 difficult to get access to it or you don't own 0:10:16.360 --> 0:10:18.520 the rights to it, Like it isn't that bonkers. But 0:10:18.559 --> 0:10:20.720 the reason they do that is because it's really difficult 0:10:20.760 --> 0:10:22.520 to stow it on a cold wallet. You're going to 0:10:22.600 --> 0:10:25.800 forget your password. And so one of the biggest challenges 0:10:25.840 --> 0:10:28.840 I think that crypto investors talk about is how do 0:10:28.920 --> 0:10:31.720 we make it more palaceable for the masses, Because it's 0:10:31.720 --> 0:10:34.360 not just that you know, bitcoin goes up and down 0:10:34.400 --> 0:10:36.360 and you might lose all your money. It's also that 0:10:36.960 --> 0:10:40.200 the digital literacy is a thing, and it's not even 0:10:40.280 --> 0:10:42.760 that you have to be digitally literate not to get crypto. 0:10:42.840 --> 0:10:47.320 You can be incredibly digital litteral and still not get crypto. Well, 0:10:47.880 --> 0:10:51.160 you know, in traditional finance tradfy as it were, the 0:10:51.200 --> 0:10:53.920 way that folks have solved this is with regulation and 0:10:54.000 --> 0:10:56.280 legal precedents. Right, Like, if you put your money in 0:10:56.320 --> 0:10:59.840 a bank and the bank goes under up to US 0:10:59.880 --> 0:11:03.040 or an amount, you will get your dollars back. It's 0:11:03.080 --> 0:11:05.600 not even any kind of a well did city but no, 0:11:07.040 --> 0:11:08.920 So if you had up to two hundred fifty dollars 0:11:08.920 --> 0:11:10.800 in the US and the bank goes onto you're gonna 0:11:10.840 --> 0:11:13.199 get your money back. And so I find it a 0:11:13.240 --> 0:11:16.640 little bit challenging to square this idea of folks in 0:11:16.720 --> 0:11:19.040 crypto saying we want to make it more palatable for 0:11:19.080 --> 0:11:23.520 retail investors while simultaneously saying we don't want any additional 0:11:24.160 --> 0:11:28.440 government interaction with our asset class. There's a big elephant 0:11:28.480 --> 0:11:31.559 in the room here in that no one knows legally 0:11:31.960 --> 0:11:36.679 if a company like FDx files for bankruptcy, where the 0:11:36.720 --> 0:11:40.360 people who had deposited coins, where they stand in sort 0:11:40.360 --> 0:11:43.200 of the hierarchy of who gets paid out in a 0:11:43.240 --> 0:11:46.640 bankruptcy filing. You know, there are they secured creditors, so 0:11:46.720 --> 0:11:50.160 they get paid out ahead of non secured creditors. That 0:11:50.200 --> 0:11:52.160 hasn't been tested in the bankruptcy courts. And if you 0:11:52.200 --> 0:11:54.480 read coin bases, I'm one of my hobbies is reading 0:11:54.559 --> 0:11:57.480 risk factors of public companies. If you read coin bases 0:11:57.880 --> 0:12:02.400 risk factors in their sec filings, they'll say fingers crossed. 0:12:02.640 --> 0:12:05.000 You know, they don't really say fingers crossed. I'm atting that, 0:12:05.080 --> 0:12:10.640 but it's it's implied that we think in a potential 0:12:10.679 --> 0:12:12.920 bankruptcy and no one saying coin bas is gonna go bankruptcy, 0:12:12.960 --> 0:12:15.160 but these risk factors you have to give every possible 0:12:15.200 --> 0:12:18.280 dire scenario, and they're saying, you know, in the event 0:12:18.280 --> 0:12:22.400 of bankruptcy, we think that people who have come to 0:12:22.520 --> 0:12:25.080 us for custody of of their coins, which is not 0:12:25.160 --> 0:12:27.400 just you know, mom and pop traders, that could be 0:12:27.600 --> 0:12:31.720 you know, funds, big time players, we think that the 0:12:31.760 --> 0:12:34.160 courts will decide that they will get paid back their 0:12:34.160 --> 0:12:37.760 crypto holdings. But it's not It hasn't been really tested 0:12:37.960 --> 0:12:41.640 and appealed and everything in courts, so no one really knows. 0:12:42.120 --> 0:12:46.480 As a depositor in one of these exchanges were lenders 0:12:46.760 --> 0:12:50.959 or any other crypto company. What's to become of those 0:12:51.000 --> 0:12:53.319 coins in a bankruptcy? How you'll get treated by the 0:12:53.360 --> 0:12:55.880 bankruptcy court as a client of of one of these companies. 0:12:56.000 --> 0:12:58.360 I feel like because all roads seem to lead back 0:12:58.440 --> 0:13:01.079 to Matt Levine somehow when it comes to this, it's 0:13:01.120 --> 0:13:04.960 it's very much the this isn't actually a trust less ecosystem. 0:13:05.040 --> 0:13:08.880 Like the amount of faith you have to have in 0:13:09.240 --> 0:13:12.880 different things working in order to navigate the system right 0:13:12.880 --> 0:13:16.880 now seems to be at an all time high. Up next, 0:13:17.160 --> 0:13:19.960 more from Bloomberg's Mike Reagan and Emmelin Nicole on the 0:13:19.960 --> 0:13:32.240 crypto faithful Emily or maybe you, Mike, in your you know, 0:13:32.440 --> 0:13:34.760 the time that you've been reporting on crypto, even just 0:13:34.800 --> 0:13:37.160 in the past twelve months, do you think there's been 0:13:37.160 --> 0:13:39.400 a shift in like the level of kind of aggression 0:13:40.120 --> 0:13:43.880 around you know, some very straightforward types of reporting that's 0:13:43.880 --> 0:13:46.160 happening because the market has gone down because of this 0:13:46.240 --> 0:13:49.200 collapse of trust, Like what are you seeing? Yeah, for sure, 0:13:49.280 --> 0:13:52.560 I Mean there's kind of two prongs to it, right 0:13:52.600 --> 0:13:55.959 in that on the one hand, the aggression is stemming 0:13:56.040 --> 0:13:59.960 from now, especially in a post FTX world, even though 0:14:00.040 --> 0:14:02.240 is at the very top of these companies like Finance 0:14:02.320 --> 0:14:04.839 Yo s e Z say, Okay, I'm going to be 0:14:04.960 --> 0:14:07.680 more proactive in calling out what I think could be 0:14:07.800 --> 0:14:10.880 fraud because maybe it'll give everybody the warning clients they 0:14:10.880 --> 0:14:14.000 needed to have spotted FDx before it happened. Actually reflect 0:14:14.000 --> 0:14:17.439 on the SCS situation, and I kind of blame myself 0:14:17.480 --> 0:14:20.320 for tweeting that too late. I think as the industry, 0:14:20.320 --> 0:14:22.840 we let fts got too too big before we started 0:14:22.880 --> 0:14:26.080 questions someone those things. So I'm taking the approach where 0:14:26.120 --> 0:14:29.480 we ask questions much earlier, and that has already resulted 0:14:29.520 --> 0:14:32.680 in several instances of him tweeting something and then having 0:14:32.720 --> 0:14:35.640 to delete the tweet because actually it caused more fear 0:14:35.680 --> 0:14:38.520 and uncertainty and doubt than it was supposed to do. 0:14:38.720 --> 0:14:42.840 The opposite um But on the other hand, there's also 0:14:42.960 --> 0:14:46.880 more aggression around trying to be more stable with what 0:14:46.920 --> 0:14:49.600 you're putting out there about your own company. But if 0:14:49.600 --> 0:14:52.000 you're an investor and you have your own portfolio, you 0:14:52.040 --> 0:14:54.240 want to make sure that the tokens that you hold 0:14:54.280 --> 0:14:57.880 aren't coming under dress unnecessarily, and so you'll sit, you'll 0:14:57.960 --> 0:15:00.400 jump in quickly when you hear someone saying something that 0:15:00.440 --> 0:15:02.880 you think is inaccurate to say, actually, hold on, here's 0:15:02.920 --> 0:15:05.760 what I think. And the finance example you gave of 0:15:05.880 --> 0:15:08.200 the two billion is a great example of that, because 0:15:08.600 --> 0:15:11.040 we see this spot tweet out that two billion in 0:15:11.080 --> 0:15:15.440 bitcoin is moving. Um Zi rapidly says, this is just 0:15:15.600 --> 0:15:17.840 you know, us doing something for our orders Too who 0:15:17.880 --> 0:15:20.320 asked it for our proof of reserves. But then we've 0:15:20.360 --> 0:15:23.800 already heard from others like Mirror Cristanto, who works for 0:15:23.800 --> 0:15:27.480 a digital currency group, saying that actually, an Orders Too 0:15:27.520 --> 0:15:29.200 would never ask you to do that because that's a 0:15:29.240 --> 0:15:31.800 financial liability for them, And then you don't really know 0:15:31.840 --> 0:15:33.600 who's trust right, and it leaves you in the in 0:15:33.680 --> 0:15:37.680 this limbo. And in a way, I think this all 0:15:37.760 --> 0:15:40.800 to me looks like the market is trying to do 0:15:41.240 --> 0:15:44.360 what regulators would do if if they could wrap their 0:15:44.360 --> 0:15:48.120 hands around this, which is sort of force some accountability 0:15:48.280 --> 0:15:52.240 on these companies, force more transparency with the proof of reserves. 0:15:52.760 --> 0:15:55.680 And it reminds me of something we wrote a while ago, 0:15:56.000 --> 0:15:58.520 that notion of crossing the chasm, you know, going from 0:15:58.920 --> 0:16:03.600 early adopters who are you know, comfortable working with private 0:16:03.680 --> 0:16:06.400 keys and and that sort of thing to sort of 0:16:06.400 --> 0:16:09.440 a more mainstream adoption where you have these big, you know, 0:16:09.480 --> 0:16:13.680 centralized exchanges and players and sort of being forced to 0:16:14.160 --> 0:16:18.120 mature and provide the type of disclosure, the type of 0:16:18.120 --> 0:16:21.760 transparency really build. The type of confidence that you know, 0:16:21.920 --> 0:16:25.920 decades of regulation did in the radifi world is really 0:16:25.920 --> 0:16:29.000 being forced on them now, not by regulators but by 0:16:29.120 --> 0:16:31.440 the market itself, by the players in the market who 0:16:31.520 --> 0:16:33.640 are like, enough is enough. You know, you need to 0:16:34.280 --> 0:16:36.560 do this, that and the other thing to really have 0:16:36.640 --> 0:16:40.400 our confidence going forward. Yeah, it reminds me of a 0:16:40.400 --> 0:16:44.640 phrase in kind of sociology called context collapse, right, which 0:16:44.640 --> 0:16:48.040 is what happens when a conversation or a set of 0:16:48.040 --> 0:16:51.240 idioms move from the people who have a really sophisticated 0:16:51.280 --> 0:16:54.840 understanding what's happening into into kind of the mainstream. And 0:16:54.880 --> 0:17:00.080 I really think that a fascinating dynamic has been the 0:17:00.160 --> 0:17:03.760 rate at which and actually going back, crypto hit the 0:17:03.800 --> 0:17:07.600 mainstream on an upswing. It was, you know, Matt Damon 0:17:07.680 --> 0:17:10.639 and Tom Brady are telling you to buy to buy 0:17:10.720 --> 0:17:12.440 crypto and buy n f T s and then it 0:17:12.520 --> 0:17:17.040 hit their downstream really really fast at the same time, 0:17:17.080 --> 0:17:19.679 and folks have a kind of a cultural whiplash, as in, 0:17:20.119 --> 0:17:21.679 is this thing good? Is this thing bad? Is it 0:17:21.720 --> 0:17:23.160 the worst thing ever? Is it the best thing ever? 0:17:23.240 --> 0:17:26.000 I just can't felt um. And you don't really get 0:17:26.000 --> 0:17:29.760 the impression that the industry itself was like prepared to 0:17:29.880 --> 0:17:32.959 navigate all this, but you're right, absolutely not. And you know, 0:17:33.080 --> 0:17:37.119 the due diligence was in a bull market is something 0:17:37.200 --> 0:17:40.399 that seems to have been deferred. Oh, this company is 0:17:40.440 --> 0:17:43.240 invested in that one. I I can trust that they've 0:17:43.280 --> 0:17:45.840 done the due diligence. No one really seemed to do 0:17:45.880 --> 0:17:49.040 the homework they should have done, because if you waited 0:17:49.080 --> 0:17:51.080 too long to do it, you missed out, You missed 0:17:51.119 --> 0:17:54.760 the rallies. So you know, these periods of market destruction 0:17:54.840 --> 0:17:57.760 can be creative destruction in a way, and that they 0:17:57.800 --> 0:18:02.600 will cause an outcome where, you know, problems get fixed, 0:18:02.600 --> 0:18:06.280 confidence restored, one would hope, but you know, you never 0:18:06.320 --> 0:18:08.400 know how long it's going to take to to sort 0:18:08.400 --> 0:18:10.359 of really get it back into the full swing of 0:18:10.400 --> 0:18:13.880 things like we saw in Alright. Well, thank you both 0:18:13.880 --> 0:18:18.040 of being on the show. Thank you, thank you. You 0:18:18.080 --> 0:18:20.520 can find more of Mike Reagan and emilin Nicole's work 0:18:20.520 --> 0:18:23.359 on the Bloomberg Terminal and on Bloomberg dot com, and 0:18:23.400 --> 0:18:26.159 of course, check out Mike's podcast that he hosts with 0:18:26.240 --> 0:18:29.119 friends of the show Bill Donna, called What Goes Up. 0:18:35.240 --> 0:18:38.399 This is Bloomberg Crypto, a daily podcast from Bloomberg and 0:18:38.440 --> 0:18:41.399 I Heeart Radio. For more shows from I Heeart Radio, 0:18:41.600 --> 0:18:44.719 visit the I Heart Radio app, Apple Podcasts, or wherever 0:18:44.800 --> 0:18:48.320 you get your podcasts. Send us your comments, questions, or 0:18:48.359 --> 0:18:51.360 suggestions for the show to Crypto at Bloomberg dot net. 0:18:54.560 --> 0:18:57.720 The supervising producer of Bloomberg Crypto is Vicky very Galina. 0:18:58.119 --> 0:19:01.800 Our senior producer is Janet Babin. Our producers are Mohammed 0:19:01.800 --> 0:19:05.439 Farruk and Sharon Barriro. Our associate producers are Ty Butler 0:19:05.520 --> 0:19:09.080 and Moses on Them. Desta wonder At is our engineer. 0:19:09.440 --> 0:19:14.640 Original music by Leo Sidron. I'm Stacy Maria Schmal. We'll 0:19:14.680 --> 0:19:15.400 be back tomorrow.