Speaker 1: This is Bloomberg Crypto, a daily Bloomberg IHOD podcast, and
Speaker 1: I'm Stacy Marie Ishmael, Managing editor of Crypto for Bloomberg News.
Speaker 1: It's Wednesday, December four. Hey, everybody, quick housekeeping notes. This
Speaker 1: episode was recorded before Sam bankman Fried was arrested in
Speaker 1: the Bahamas earlier this week. SPF, as he's known, has
Speaker 1: now been charged by pretty much everyone, including the Securities
Speaker 1: and Exchange Commission and the Department of Justice, on allegations
Speaker 1: of everything from defrauding investors to com England customer funds.
Speaker 1: While the following episode unpacks the year's biggest stories, I
Speaker 1: would be remiss not to admit that this is perhaps
Speaker 1: the biggest of them all. We'll be covering spfs arrest
Speaker 1: and these charges against him in much more detail in
Speaker 1: other episodes this week. Thanks for tuning in. It's safe
Speaker 1: to say two wasn't the best year the crypto. By
Speaker 1: late January, bitcoin had already shed half its value compares
Speaker 1: to the old times high set previously in November, and
Speaker 1: that number, if you remember, was nearly sixty dollars. Bitcoin
Speaker 1: prices then stayed on a downward trend. That trend accelerated
Speaker 1: after the first major crisis of the collapse of an
Speaker 1: algorithmic stable coin called terra USD. Now, the implosion of
Speaker 1: what was once considered an ambitious experiment for defy sent
Speaker 1: shock waves through the industry, triggering the collapse of a
Speaker 1: crypto hedphone called Three Arrows Capital, which then led to
Speaker 1: bankruptcies that companies called Voyage of Digital and Celsius, and frankly,
Speaker 1: it was starting to feel a little bit like the
Speaker 1: Hunger Games. Crypto CEOs and other senior executives racing for
Speaker 1: the exit, true believers getting into Twitter fights about whether
Speaker 1: centralization was the real enemy, all against this weird backdrop
Speaker 1: of conferences and parties where people were trying to rekindle
Speaker 1: enthusiasm for their board actions. It was a weird time.
Speaker 1: And then, most recently, and for a lot of us,
Speaker 1: most surprisingly, you had the collapse of one of the
Speaker 1: most significant crypto exchanges in the sector FTX. Quite the
Speaker 1: air has not even done here to break down the
Speaker 1: year's biggest stories with me are Bloomberg Reports, has Voldona Hark.
Speaker 1: Crypto people like the idea of becoming more mainstream or
Speaker 1: just being able to be part of your everyday conversation
Speaker 1: and Emilina Cole high yields that Crypto had been advertising
Speaker 1: during this period of low interest rates in the real
Speaker 1: real world to entire small people into the system. Those
Speaker 1: frequently and in a big ways, started to show cracks.
Speaker 1: Emily Voldona, what a pleasure to have you on the show.
Speaker 1: Thank you so much for having us. Emily. Can you
Speaker 1: just remind everybody what your actual job is, because I
Speaker 1: feel like it's it's a little complicated. Yeah, so I'm
Speaker 1: technically the Bloomberg Crypto blogger, which is a real nice phrase,
Speaker 1: but it basically means that, in addition to doing news
Speaker 1: coverage on Crypto, a lot of what I do is
Speaker 1: analysis in terms of exactly helping we just understand what
Speaker 1: happened in this year, in particular what went wrong um
Speaker 1: and who the players were and how that might all
Speaker 1: be interlinked across the whole year. Basically reminding you about,
Speaker 1: like here's the big news today and here's what you've
Speaker 1: forgotten already happened. That should give you all the context.
Speaker 1: Good Please remind me. But Vildonna, welcome back. What do
Speaker 1: you do? I love to be on this podcast specifically,
Speaker 1: that's my main job now. I'm actually a cross asset reporter,
Speaker 1: which when I tell people that, they always say, what
Speaker 1: are cross assets? And I don't have a very good
Speaker 1: answer except that we cover all kinds of markets, including
Speaker 1: for me, the crypto market, which has been actually very
Speaker 1: fun and very rewarding over the last four or five
Speaker 1: years or so, because the stuff that happened in stin
Speaker 1: crypto is sometimes so much wilder than anything you can
Speaker 1: find in the stock market or the bond market, and
Speaker 1: it's sometimes very painful to go through, obviously for a
Speaker 1: lot of people, but it's been very very rewarding to
Speaker 1: be covering and writing stories about. And you say this
Speaker 1: as a person who's covered some wild rides in stocks
Speaker 1: and bonds. Right, So, and one of the things that
Speaker 1: we're going to do in this episode is talking a
Speaker 1: little bit about what was happening in crypto and how
Speaker 1: that was informed by that broader macro context. But first,
Speaker 1: let's do some like do Do Do Do Do? Go
Speaker 1: Back in Time music. That's a really good soundtrack. Our
Speaker 1: sound engine is gonna be mad at me, but let's
Speaker 1: go back in time. Because I feel like to start
Speaker 1: and to talk about what happened, we have to go
Speaker 1: back and specifically, we need to go back to the
Speaker 1: coin base i p Yes, what was going on around
Speaker 1: the time of the coin based i pod we thought
Speaker 1: twin twenty two years. Wild one also was very wild
Speaker 1: because we had just from the pandemic a huge stock
Speaker 1: market rally. We had prices of all manner of crypto things,
Speaker 1: including n f T s and stuff that we had
Speaker 1: never heard of before, skyrocketing in value. Everybody had laser
Speaker 1: eyes on their Twitter profiles, which they've since removed. And
Speaker 1: with the around the coin based i p O, I mean,
Speaker 1: there was just a lot of excitement around it's coming
Speaker 1: out to the public, so to say, it was just
Speaker 1: very exciting for a lot of crypto people because crypto
Speaker 1: people like the idea of becoming more mainstream or just
Speaker 1: being able to be part of your everyday conversation. And
Speaker 1: coin base and obviously a lot of other developments sort
Speaker 1: of helped that. But we we had very low interest
Speaker 1: rates and there was just a lot of speculation, a
Speaker 1: lot of froth, game stop and all of those sort
Speaker 1: of meme stocks. Everything was skyrocketing, including so much stuff
Speaker 1: in crypto mm hmm. And that was you know, April,
Speaker 1: there was a sense of optimism. Yes to the moon.
Speaker 1: We were like, this is everything is going great, you know.
Speaker 1: Fast forward a couple of months or several months to September,
Speaker 1: El Salvador starts accepting bitcoin as legal tender. More enthusiasm,
Speaker 1: you know, the folks who were looking at bitcoin like,
Speaker 1: here's the first best example of an actual government, you know,
Speaker 1: a country taking this token seriously. Fast forward another couple
Speaker 1: of months, you have, as you mentioned, the hype around
Speaker 1: non fungible tokens culminated in every celebrity going on whatever
Speaker 1: nightly talk shows talking about how amazing their Ugo Labs
Speaker 1: board ape situation is. We get to November, bitcoin hits
Speaker 1: an all time high. Yeah, and there was one more
Speaker 1: important thing that happened around then. In October, we had
Speaker 1: the first bitcoin futures et F and actually there are
Speaker 1: a couple of them, but when the first one debuted
Speaker 1: by pro Shares, it saw so much trade eating that
Speaker 1: it was just like for the record books basically, and
Speaker 1: it amassed more than a billion dollars in assets in
Speaker 1: two days, which was also a record. So that also
Speaker 1: was you know, Bitcoin's price was hitting record highs around
Speaker 1: that time, and then in the weeks following it kept
Speaker 1: sort of hitting those highs until we got the almost
Speaker 1: sixty nine thou per coin number. So we're going into December.
Speaker 1: Everything in crypto is amazing, amazing crypto and the booming
Speaker 1: interesting look at bitcoins as well in the cryptocurrency space.
Speaker 1: Of course, this weekend, Emily, everyone paying attention to the
Speaker 1: Super Bowl. It's super Bowl. One of the things that
Speaker 1: was remarkable is on hindsight is everything, but it was,
Speaker 1: you know, people were spending millions and millions of dollars
Speaker 1: on really splashy crypto advertising and the Super Bowl. Even
Speaker 1: if you don't care about football, American football specifically is
Speaker 1: a vehicle for kind of cultural commentary around ads, marketing, branding, sponsorship,
Speaker 1: and so much of that commentary was around crypto. Emily.
Speaker 1: What happened right after that in March, I think probably
Speaker 1: the biggest thing that happened that month was the hack
Speaker 1: of a bridge connected to tax the Infinity, which was
Speaker 1: responsible for making sure that all the people who played
Speaker 1: Acts the Infinity, the boxing game could cash out their
Speaker 1: earnings because it was at that time very popular among
Speaker 1: people in lower income countries for earning a living, and
Speaker 1: for a long time they couldn't get any of their
Speaker 1: money back. So that was the first I suppose ding
Speaker 1: on sentiment right, but it was because it was the first,
Speaker 1: it wasn't the worst. There was a sense of that
Speaker 1: seems bad. There's always stuff like that happening exactly, you know,
Speaker 1: it's like, well, yeah, it's a crypto hack. It's not ideal,
Speaker 1: but we'll we'll get through it. Then we started to
Speaker 1: have to know what an algorithmic stable coin is, and
Speaker 1: specifically terror u s D and its associated token Lunar
Speaker 1: terror USD and its sister token Luna lost their peg
Speaker 1: to the dollar in the last few weeks. They had
Speaker 1: a spectacular meltdown, sending prices to near zero and their
Speaker 1: market value to a shadow of the combined Emily, why
Speaker 1: did so many folks need to care about that? So,
Speaker 1: Tara USC and Luna had been kind of the darlings
Speaker 1: of the defise sector for quite a few months eating
Speaker 1: up to that point, um there had been quite a
Speaker 1: lot of noise going around about about Tara and Luna. Specifically,
Speaker 1: Galaxy Digitals billion I CEO Michael Neverbrat's got famously got
Speaker 1: a tattoo of a lunar wolf to show how much
Speaker 1: he cared about the cryptocurrency, and so when the two
Speaker 1: collapsed together in the space about a week, wiping about
Speaker 1: forty billion dollars in value, this was a sign that
Speaker 1: actually something in the market infrastructure in the way that
Speaker 1: crypto was being sold to people, as this like solve
Speaker 1: all magical financial instrument, was not okay, and not everything
Speaker 1: was was going to be living up to the promises
Speaker 1: that had been touted by its founders. So Terra as
Speaker 1: an indicator of sentiment was a huge deal, But it
Speaker 1: was also a huge deal in terms of the actual
Speaker 1: market consequences that accrued as this thing started to collapse,
Speaker 1: because it turned out, as we have reported, some of
Speaker 1: the biggest and supposedly smartest players in crypto were very
Speaker 1: very exposed to either the Terry USD stable coin itself,
Speaker 1: to other people who were exposed to the terror USD
Speaker 1: stable coin. Filed on and talk a little bit about
Speaker 1: what it was like watching the collapse happen. After that, well,
Speaker 1: two things. Just one thing to just set the scene
Speaker 1: a little bit more. What we have happening this year, obviously,
Speaker 1: is the FED was raising interest rates, and that's really
Speaker 1: sort of put a damper on sentiment, not just in crypto,
Speaker 1: but also in the stock market. The bond market also
Speaker 1: wasn't doing well at all during and so you had
Speaker 1: just people being very risk averse all year long, and
Speaker 1: that in particular, I would say, hit cryptocurrencies and all
Speaker 1: manner of cryptocurrencies and all manner of crypto offshoots and
Speaker 1: you know whatever else. And f t S also dropped,
Speaker 1: I mean plummeted in in value. But to to your
Speaker 1: point about the interconnectedness and the big players that have
Speaker 1: been involved, these are people who had huge followings on Twitter,
Speaker 1: where a lot of crypto discourse happens, and they tweeted
Speaker 1: quite a bit about all kinds of stuff, sometimes sometimes
Speaker 1: at each other, and sort of started these feuds, which
Speaker 1: I'm sure we will talk a little bit more about
Speaker 1: as regards f t X, But it sort of just
Speaker 1: started showing people just how interconnected all of these different
Speaker 1: companies were. Who was loaning money to whom, vice versa,
Speaker 1: who was buying what, And then once one sort of
Speaker 1: block in the domino fell, how it started impacting all
Speaker 1: sorts of other companies and everything was just very to Wolf,
Speaker 1: I can't believe you didn't go for one block in
Speaker 1: the chain, Oh gosh, this opportunity. Gosh, I'll kick myself
Speaker 1: forever for that. Up next, more from Bloomberg reporters Voldana
Speaker 1: Harrig and Emily Nicole on the year's biggest headlines and
Speaker 1: what all of this news could mean for three We'll
Speaker 1: be right back, so, Emily, you know, to to Vldona's points,
Speaker 1: you have this interconnected web of relationships, many of whom
Speaker 1: are people who actively hate each other. What does that
Speaker 1: have to do with three Hours Capital? They had made
Speaker 1: some rather sizeable bets when it came to Tara and Luna.
Speaker 1: So when the value of those holdings went to zero, um,
Speaker 1: the loans that have been extended to three Hours Capital,
Speaker 1: with which it made most of its trading, they were
Speaker 1: no longer able to meet those loans, and so when
Speaker 1: the margin calls came in, everything just basically collapsed and
Speaker 1: and that went down too. But being a hedge fund
Speaker 1: of thoughts at three hours Capital had clients. Many firms
Speaker 1: had either lended loan money to three hours or had
Speaker 1: invested in it. And so therefore, as fil Downa described
Speaker 1: it as dominos, those sides fall too, and we get
Speaker 1: to now see the beginnings of this ripple effect that
Speaker 1: spreads out from almost like terrors the start of it,
Speaker 1: although obviously the market had already started to show signs
Speaker 1: of weakness before then. But as we go further and
Speaker 1: further out, even as far as like this month alone,
Speaker 1: we still have people saying, oh, and the knock on
Speaker 1: the market that happened with Terror is the reason why
Speaker 1: we have losses today. Um, and that slowly started the
Speaker 1: web of bankruptcies that we're currently in. And when you
Speaker 1: talk about things like margin calls, counterparties, what you're describing
Speaker 1: is the fact that so many of these players all
Speaker 1: each other money. So you know, you could be hedge
Speaker 1: fund and you borrow money from this lender over here
Speaker 1: in order to do a trade on this other thing
Speaker 1: over here, and in order to do a trade on
Speaker 1: that thing, you had to put up some collateral. So
Speaker 1: Three Arrows Falls files for bankruptcy in their week. A
Speaker 1: couple of other companies, one called Voyager, one called Celsius
Speaker 1: also file for bankruptcy, Celsius being perhaps the most consumer
Speaker 1: facing of the entities that have been caught up in
Speaker 1: this so far, because well, what was the Celsius business model?
Speaker 1: What did they do? So Celsius was in the business
Speaker 1: of giving people yields if you promised to lock up
Speaker 1: your tokens with them. So if you think about it
Speaker 1: a little bit like a savings account, but you know,
Speaker 1: just without any of the banking licenses or regulators or
Speaker 1: any of the bits to protect you if the company
Speaker 1: goes under UM. And what it turned out is that
Speaker 1: if people had read the terms of service, they would
Speaker 1: have seen that. And actually this is pretty common and
Speaker 1: a lot of crypto company's terms of service as we
Speaker 1: now know UM. If you gave your assets to Celsius,
Speaker 1: Celsius reserve the right to do or whatever it wanted
Speaker 1: with those assets. They no longer really belonged to you
Speaker 1: in any sense of the word. So when what they
Speaker 1: had done in order to generate those yields that it
Speaker 1: could pay back out was invest those tokens elsewhere rehypothication UM.
Speaker 1: And as a result, if some of that went in lunar,
Speaker 1: that all went. If some of it went in something
Speaker 1: that was called staked ether um, that also started to
Speaker 1: show slight signs of discount from the price of main
Speaker 1: Either I won't get into the actual mechanics of it,
Speaker 1: but basically that was unstable too UM. And so Eventually,
Speaker 1: the high yields that crypto had been advertising during this
Speaker 1: period of low interest rates in the real real world
Speaker 1: to entire small people into the system, those frequently and
Speaker 1: in big ways started to show cracks and signs of
Speaker 1: that they weren't able to sustain offering those yields anymore.
Speaker 1: And now if you see platforms offering yields of I mean,
Speaker 1: eight percent is probably about the average now, but back
Speaker 1: then it was um that's also a massive warning sign
Speaker 1: to consumers that this is probably not something that can
Speaker 1: guarantee that yield for very long. And was on this
Speaker 1: how does this fit into the rising interest rate environment
Speaker 1: that you described? Well, I think from because I talked
Speaker 1: to a lot of rad five people, traditional finance people too,
Speaker 1: and all along what they sort of as onlookers into
Speaker 1: the crypto world had been saying is these are warning signs.
Speaker 1: You can't just earn eight, ten, twenty percent just lending
Speaker 1: out your crypto holdings, that we're putting your money in
Speaker 1: some of these bank like products without there being just
Speaker 1: so much risk involved. And this sort of kept playing
Speaker 1: out throughout the year. So we we saw it with
Speaker 1: Celsius and Voyager. Obviously, both of them going under, but
Speaker 1: then also later on with Gemini, and that also was
Speaker 1: a yield earning product where people had put in bitcoin
Speaker 1: or ether or some sort of stable coin and then
Speaker 1: the gem it was called Gemini earned, Gemini earned, would
Speaker 1: lend out those holdings and try to earn an interest
Speaker 1: in return for themselves. And those also have the withdrawals
Speaker 1: have been halted and book can't get their money back.
Speaker 1: So another example of the ways in which the main
Speaker 1: streaming of crypto that you referred to at the beginning
Speaker 1: turned out to have pretty serious consequences for people in
Speaker 1: ways that they weren't necessarily expecting or hoping for. Now,
Speaker 1: in around October two, you know, a couple of months
Speaker 1: after these various thirty years ago, after these bankruptcies start
Speaker 1: getting filed, we published a story about the wave of
Speaker 1: high ranking you know, executive suite departures. Vasan, I don't
Speaker 1: even know if you even remember, but you were like
Speaker 1: one of the people who wrote the story because like
Speaker 1: dozens of whether they are crypto CEUs or people in
Speaker 1: risk or heads of trading were either being downsized, right,
Speaker 1: so there were layoffs and they were part of them,
Speaker 1: or they were like I'm gonna go spend some more
Speaker 1: time with my yacht. YEP, that is a real thing
Speaker 1: that I would love to not making that up. So,
Speaker 1: you know, you start to see this um sinking ship
Speaker 1: feeling sentiments and that that in and of itself. People
Speaker 1: are looking around and they're like, hang on a minute,
Speaker 1: why are all these people losing their jobs? Why are
Speaker 1: all these people quitting? There were very, very significantly off
Speaker 1: at a lot of places. And then less than a
Speaker 1: month later is when we perhaps get into the part
Speaker 1: of the crisis that I'm not sure most people would
Speaker 1: have said, this is the next shoe to drop, and
Speaker 1: that shoe was the collapse of f t X and
Speaker 1: it's CEO and it's CEO Sam Bankman freed emily. If
Speaker 1: it were possible to summarize the state of things about
Speaker 1: how we got there, what would you say? So hind signe.
Speaker 1: So now my explanation will be covered by the facts
Speaker 1: that we know now compared to what we knew before.
Speaker 1: F t X had its own native token called ftt
Speaker 1: and it appears that f t X belong with its
Speaker 1: sister trade platform, Alameda Research had been using that token
Speaker 1: for various purposes, but mainly one of those was at
Speaker 1: least at Alameda as collateral for loans that it had
Speaker 1: taken out to fund its trading activities. There are also
Speaker 1: some suggestions now and these are being investigated to the
Speaker 1: present as to whether or not f t X commingled
Speaker 1: customer assets with Alameda assets not to be able to
Speaker 1: fund some of these trades as well. Um But in
Speaker 1: October some of this information was leaked into the press,
Speaker 1: and Finances CEO shangqung Zhao said that he would sell
Speaker 1: a very large portion of FTT because Finance was concerned
Speaker 1: about how how stable that business was. And from there
Speaker 1: it took oh, i'd say less than two days until
Speaker 1: ft X then said okay, we are selling ourselves to Finance,
Speaker 1: and then less than twenty four hours again until Finance
Speaker 1: said sorry, no, we don't want that deal, and then
Speaker 1: another another twenty rouse until Alamidas Sam bankmin Freed said
Speaker 1: Alameda would wind itself down, and then another twenty four
Speaker 1: hours until FTX was in bankruptcy. So between Sunday and Friday,
Speaker 1: one of the largest crypto exchanges that we have was gone.
Speaker 1: In other words, thirty years went by. That was during
Speaker 1: that week. That was quite a week. That was quite
Speaker 1: a week. And you know, the thing, just the gloss
Speaker 1: I want to put on top of all of this
Speaker 1: is like, while all of this was happening, everything that
Speaker 1: we've just described, bank when Freed had been playing the
Speaker 1: part of rescuer in chief, right, So when the collapse
Speaker 1: of three Hourrows triggered the collapse of Celsius and Voyager
Speaker 1: and other companies, bankman Freed emerge and he's like, I
Speaker 1: will buy everyone, or at least you know, he will
Speaker 1: buy the ones that he could Abriese financing for and
Speaker 1: be he thought was worth his and f t X
Speaker 1: as time. This was also a period in which there
Speaker 1: were intensive discussions around the world about how best to
Speaker 1: regulate crypto, and various crypto ceo saying all we want
Speaker 1: is notory clarity. Please give that to us. Here. We've
Speaker 1: written you proposals, so you know of which exactly of
Speaker 1: which Sam was the face. You know, obviously you also
Speaker 1: had Brian Armstrong coin Base CEO being you know, represented
Speaker 1: in these conversations, and in the US, you have um
Speaker 1: CC of Finance being represented not in the US, but
Speaker 1: certainly in conversations and many other countries around the world.
Speaker 1: And now it's almost as if none of that happened.
Speaker 1: I think that the sort of the strangest thing about
Speaker 1: twenty two. It's not even that we're back where we're started.
Speaker 1: It's like we're back into before the coin base. I P. Well, one,
Speaker 1: there's a lack of liquidity, Like the amount of trading
Speaker 1: that's happening in crypto has essentially fallen off a cliff,
Speaker 1: partly because some of the places people were trading on
Speaker 1: went bust. There is a real noticeable, shall we say,
Speaker 1: vibe shift in the sentiment for an industry that not
Speaker 1: super long ago was having debauched parties in Miami and
Speaker 1: now they're worrying about being summoned in front of you
Speaker 1: senators and other types of investigators. And we have a
Speaker 1: definite change and tenor of the regulatory conversation because it's
Speaker 1: gone from how can we help this industry to succeed
Speaker 1: to how can we protect consumers? Emily, I want to
Speaker 1: make sure that you know, we don't only talk about
Speaker 1: what's been happening in the US. Tell us a little
Speaker 1: bit about how some of these things played out in
Speaker 1: the UK and Europe. Let's start with Europe because that's
Speaker 1: the that's a little bit easier. The European Union has
Speaker 1: been working on a comprehensive crypto regime for a long time,
Speaker 1: and that was partly the the criticism of the EU
Speaker 1: earlier this year was that it had taken them so
Speaker 1: long to get here UM. But in June they agreed
Speaker 1: the provisional steps for MIKA as it's known UM that
Speaker 1: would put in place some level of oversight of crypto
Speaker 1: companies and maybe a little bit of protection for for
Speaker 1: consumers in terms of just helping make sure that companies
Speaker 1: do as they say they do and are overseen properly
Speaker 1: by local regulators. UM. There are things that are not
Speaker 1: included in there, which were some of the things that
Speaker 1: went wrong this year, like defy and staking and particular
Speaker 1: types of crypto assets, and so that will all have
Speaker 1: to come later, but the basics right UM, and that
Speaker 1: is due to be going through final agreement in February
Speaker 1: and come into force in mid four In the UK. However,
Speaker 1: there was some echoing at the start of this year
Speaker 1: about how, yes, crypto is going through a rough patch,
Speaker 1: but you know there's there's still a dream to be had. UM.
Speaker 1: So we're going to become a global crypto hub and
Speaker 1: this was all in April under the chancellor at the time,
Speaker 1: Rasci Studac, and probably thereafter Rashi Sack resigned because there
Speaker 1: was a very big political the government collapse. I'm trying
Speaker 1: to be polite about it, but basically we had no
Speaker 1: government for most of the summer UM and that meant
Speaker 1: that everything that had been suggested up until that point
Speaker 1: in terms of crypto regulations, so that's things like putting
Speaker 1: in place an oversight regime, UM, financial promotions rules, all
Speaker 1: of that got kicked to the side, including an n
Speaker 1: f T made our Royal mint who make our money UM.
Speaker 1: And it's only now in November December time that we
Speaker 1: are starting to get back on track with the government
Speaker 1: that's in place, who looks to be staying around for
Speaker 1: more than forty four days, where we might be starting
Speaker 1: to push ahead with some of that. So by the
Speaker 1: time this episode goes out, there will have been discussions
Speaker 1: in Parliament about the Financial Services a Market's Bill, which
Speaker 1: will put in place powers for our regulator to start
Speaker 1: thinking about how it can properly overseecrypto companies more than
Speaker 1: just checking they're not terrorist financing. And and next year
Speaker 1: we will start getting proposes as well on stable coins
Speaker 1: and other bits. But that's where we're at. We'll be
Speaker 1: right back. The question that everybody asks me when they
Speaker 1: extract the information that I cover crypto for a living
Speaker 1: is like, what's going to happen next? My my go
Speaker 1: to answer is if I knew that I would work
Speaker 1: for a hedge fund exactly, we'd also be parting on
Speaker 1: a yacht for sure, um in the Bahamas with everybody
Speaker 1: else who's parting on the yachts before those yachts get
Speaker 1: seized by the US government of the Singapore in the
Speaker 1: But I do think it is it is reasonable and
Speaker 1: Volton I will asked this, have you've just given the
Speaker 1: work that you do on the Crossassa team, what are
Speaker 1: like the big macro economic things that are on the
Speaker 1: horizon ine that may inform, if nothing else at least
Speaker 1: the overall market environment that crypto folks are about to encounter.
Speaker 1: Well for a long time, and we've talked about this
Speaker 1: before in this podcast, crypto and stocks basically traded the
Speaker 1: same way, So if one went up one day, likely
Speaker 1: the other one was also going up and vice versa,
Speaker 1: and the correlation was extremely high, and people basically talked
Speaker 1: about is about this all all year long, and then
Speaker 1: what has happened with f t X and the aftermath
Speaker 1: of that is that those correlations actually became a bit uncoupled,
Speaker 1: so they're not necessarily eating in the same way. They're
Speaker 1: not treating in tandem anymore. And the idea is just
Speaker 1: that the trust within crypto has really broken. People just
Speaker 1: have much less faith in the system. They have less
Speaker 1: faith in I mean just about anything within crypto. They're
Speaker 1: just less trustworthy and and potentially like going forward, people
Speaker 1: will once again start thinking about some of the macro
Speaker 1: forces that are impacting both markets, both the stock market
Speaker 1: and the crypto market. But right now it seems to
Speaker 1: be sort of on its own, as everybody's just waiting
Speaker 1: to see what the next thing to happen will be.
Speaker 1: If we do return to this idea that macro forces
Speaker 1: are impacting crypto in the same way that they did
Speaker 1: for most of two then again we'll have to go
Speaker 1: back to the FED and what the FED is going
Speaker 1: to be doing, where they've sort of signaled to markets
Speaker 1: that they'll just be less aggressive than they've been earlier
Speaker 1: this year, where they were doing these jumble interest eight hikes,
Speaker 1: and that really was putting a damper on sentiments. So
Speaker 1: if they're less aggressive, potentially you could have riskier assets
Speaker 1: doing a little bit better. But there is so much
Speaker 1: more that people are waiting to unfold it within crypto
Speaker 1: itself that could really impact prices. Still, well, thank you, Emily,
Speaker 1: Thank you Aldana. See you in another thirty years or so. Yeah,
Speaker 1: that sounds great, Thanks so much for having it. You
Speaker 1: can find more of Vildonna and Emily's reporting on the
Speaker 1: Bloomberg Terminal and on Bloomberg dot com, and definitely be
Speaker 1: sure to check out for and subscribe to it twice
Speaker 1: weekly news lesso, which is also called Bloomberg Crypto. This
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Speaker 1: for the show to Crypto at Bloomberg dot net. The
Speaker 1: supervising producer of Bloomberg Crypto is Vicky Vergolina. Our senior
Speaker 1: producer is Janet Babin. Our producers are Mohammed Farouk and
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Speaker 1: on them. Desta wonder At is our engineer. Original music
Speaker 1: by Leo Sidron. I'm Stacy Marie schmal We'll be back tomorrow.