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Speaker 1: This episode is brought to you by P and C Bank.

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Speaker 1: National Association Member FDIC.

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Speaker 2: Where do you see crypto going? Because obviously that's a

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Speaker 2: major staple in you in what you guys have built

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Speaker 2: with Robin Hood in twenty twenty five, let's say twenty

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Speaker 2: thirty five, right, Yeah, where do you see crypto going?

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Speaker 2: And Bitcoin specifically?

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Speaker 3: Yeah, I think the IU guest needle mover for crypto

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Speaker 3: is that it's going to help take the great things

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Speaker 3: we've built in the US and make them increasingly global

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Speaker 3: and available to investors all around the world. Some of

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Speaker 3: which haven't had access to these tools because I think

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Speaker 3: we kind of take it for granted here that we

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Speaker 3: have the US dollar, we have access to US stocks,

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Speaker 3: we have really high quality assets. When Robinhood gets our

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Speaker 3: private initiatives, we'll be able to distribute access to private companies,

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Speaker 3: so we have really good investments and ways to allocate

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Speaker 3: your capital. If you're in Venezuela, you don't have access

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Speaker 3: to those things. And that's actually why stable coins have

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Speaker 3: been so popular, because a lot of these people are

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Speaker 3: in countries that have unstable governments, unstable central banks. If

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Speaker 3: they do have central banks at all, they don't have

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Speaker 3: functional banking systems. Currencies are devaluing and they're just adding

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Speaker 3: zeros and zeros to them. Bills are worthless. So stable

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Speaker 3: coins really became popular as a way to store your

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Speaker 3: wealth and US dollars because you know, the crypto companies

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Speaker 3: actually went in and built local rails connecting to all

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Speaker 3: of these markets, so they've been plugged into the crypto system.

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Speaker 3: And I think crypto will evolve with tokenization to make

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Speaker 3: it easy to distribute US stocks and other investments overseas

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Speaker 3: as easily as stable coins have done it to dollars.

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Speaker 3: So I think that's the future. Crypto will sort of

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Speaker 3: like the technology will help stitch together all of the

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Speaker 3: markets that make it so that everyone is on a

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Speaker 3: level playing field outside the US as we are in here.

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Speaker 3: That's at least the future that we're working to build.

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Speaker 2: So you believe in oh ecosystem, not just bitcoin, not

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Speaker 2: a Bitcoin maxie.

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Speaker 3: I'm not a Bitcoin MAXI yeah, I mean I'm a

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Speaker 3: bitcoin fan, and I think bitcoin has an inherent advantage.

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Speaker 2: Price prediction.

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Speaker 3: Oh, price predictions are tough. I would tell you, I'm

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Speaker 3: pretty I'm pretty bull And if you told me at

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Speaker 3: the beginning of the year that there would be like

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Speaker 3: a national Bitcoin Strategic Reserve and all of these dats

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Speaker 3: and we would still be sitting here basically flat for

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Speaker 3: the year, maybe a little bit up, I'd be surprised.

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Speaker 3: It's got a lot going for it. It's a singular asset, right,

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Speaker 3: It'll always be the first, So I think I think

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Speaker 3: it's got a bit of a religion around it with

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Speaker 3: the Bitcoin maxis, and and that's hard to fight relative

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Speaker 3: to the other coins.

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Speaker 1: Yeah, I think obviously, if you look at the correlation

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Speaker 1: between the rise of bitcoin getting up to one hundred

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Speaker 1: and twenty six thousand. You watch your stock also get

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Speaker 1: towards all time high around the same time. People feel

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Speaker 1: like there's a correlation there, But there's also a piece

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Speaker 1: that has helped the stock, and that's the predictive markets. Yeah,

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Speaker 1: so not only could you invest in coin, but you

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Speaker 1: could say, hey, I see it getting to one hundred

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Speaker 1: thousand by December thirty. First, talk about the role that

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Speaker 1: predictive markets is played, because we talked about it like

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Speaker 1: you were thinking about it. We were talking about the

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Speaker 1: probably market the last time we met in Miami, and

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Speaker 1: now predictive markets are a thing, a real thing that

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Speaker 1: I feel like you guys have adopted right away. Some

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Speaker 1: of the other people in the space, haven't. Ye're looking

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Speaker 1: at you guys like, this is a leader. Do we

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Speaker 1: need to add this? This is going to be disruptive.

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Speaker 3: Yeah. Absolutely, And it's kind of a fun position for

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Speaker 3: me to be in because typically when you look at

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Speaker 3: crypto and all the other products we've added, I mean,

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Speaker 3: stock's probably the best example. We were like years after

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Speaker 3: the leaders, right, I mean, stocks went electronic in the eighties.

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Speaker 3: Basically you trade got started. The idea was to trade

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Speaker 3: stocks on the Apple Macintosh. Apple Macintosh had come out,

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Speaker 3: and these two guys got together in Palo Alto, California,

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Speaker 3: and we're like, what if we use the Apple macintalk

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Speaker 3: to trade stocks? And I think that was in nineteen

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Speaker 3: eighty two, which is pretty crazy, So we were multiple

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Speaker 3: decades late to the game for electronic trading in stocks.

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Speaker 3: Crypto started in two thousand and nine. We added crypto

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Speaker 3: to the platform in twenty seventeen. Actually, yeah, twenty eighteen

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Speaker 3: was when you could start trading it. So typically we've

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Speaker 3: had an approach where we come in after there's like

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Speaker 3: clarity that it's a real thing that people want, and

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Speaker 3: then we just bring our scale, lower costs, and you know,

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Speaker 3: better UX to the product. So prediction Markets is a

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Speaker 3: new one for us because we were kind of out

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Speaker 3: in front and then it's sort of like how do

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Speaker 3: we maintain our lead and market positioning and you know,

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Speaker 3: when we have a bunch of people coming after us.

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Speaker 3: It has surprised me that, you know, you have the

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Speaker 3: exchanges like Polly and Calshi, who have obviously been there

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Speaker 3: from the beginning, but like no other brokers has gotten

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Speaker 3: into it yet, no other broker of significant consequence, And

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Speaker 3: I think they're coming like they're seeing what we're doing

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Speaker 3: and they see that it's resonating with traders and just

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Speaker 3: with mass market retail. But yeah, I think we're also

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Speaker 3: moving and we're adding new innovations. I think the event

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Speaker 3: that we're gonna we're gonna unveil on the sixteenth is

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Speaker 3: is going to show some new things to people that

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Speaker 3: they haven't seen before. And it's the fastest growing business

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Speaker 3: that Robin Hood's had. You know, in the past year,

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Speaker 3: we've gone from one single contract, which is the presidential election,

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Speaker 3: to over fifteen hundred. We've gone from it's basically the

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Speaker 3: volume is doubled quarter over quarter. Q three had I

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Speaker 3: want to say, two point two million contracts, but then

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Speaker 3: October had two point five million, so more than Q

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Speaker 3: three put together. And then you had November. We announced

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Speaker 3: some November numbers, three billion contracts traded in November, which

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Speaker 3: is yeah, it's a thirty million revenue in a month.

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Speaker 3: So so three hundred and sixty million run rate if

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Speaker 3: you take the November numbers, which is a big ramp,

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Speaker 3: and I think you know it's it's it's just been

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Speaker 3: really resonating with the traders and sports betting sports a

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Speaker 3: big part of it, but the big part of what

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Speaker 3: we're doing is also diversifying the contracts. So it used

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Speaker 3: to be just elections and elections I think to me

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Speaker 3: is probably the most interesting. Then we added sports and

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Speaker 3: we've added a ton of leagues.

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Speaker 2: There is it sports betting or like, what is it exactly?

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Speaker 3: I liked most people I took to call it wagering.

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Speaker 2: Wagering, Okay, I like the language there.

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Speaker 3: I think it's different in all seriousness to sports bet

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Speaker 3: and a lot of people ask about, you know, how

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Speaker 3: is it different from a regulatory standpoint, from a product standpoint.

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Speaker 3: I think it's significantly different. And I haven't really done

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Speaker 3: much sports betting, But what people love about it is

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Speaker 3: you can actually trade these contracts during the game, so

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Speaker 3: you know, the because it's a two sided market, the

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Speaker 3: exchanges run the contracts while the games are happening, and

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Speaker 3: that's when the information's coming in. I mean, for example,

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Speaker 3: you can see how each play changes, changes the odds

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Speaker 3: and the outcomes, and you can go in and out

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Speaker 3: of the positions and a lot of the market participants

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Speaker 3: that are coming in both from the market maker side

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Speaker 3: and sort of like on the trading side, are the

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Speaker 3: same market participants that have been trading futures and equities.

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Speaker 3: So I think it's disruptive to sports betting, but I

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Speaker 3: see it as a fundamentally different animal and a better product,

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Speaker 3: which is why I think all the traditional sports betting

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Speaker 3: sites are so nervous about it, and they're just sort

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Speaker 3: of like, uh, yeah, they see the writing on the wall,

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Speaker 3: and they're they're working as hard as possible to figure

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Speaker 3: out their prediction market strategy, and some of them are

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Speaker 3: outright pivoting to prediction markets completely.

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Speaker 1: As soon as you said the November's numbers went up,

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Speaker 1: I automatically thought NFL and its height constable in its height,

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Speaker 1: but it's not just sports and NBA. NBA is and

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Speaker 1: it is kicking off World Series is just about the end.

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Speaker 3: Well, and we have I think we mentioned this earlier

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Speaker 3: AI model contracts, which you know is a space I

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Speaker 3: feel like I have some understanding of, and you have

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Speaker 3: traders that are specializing in very specific areas, and you know,

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Speaker 3: like four months ago, it was I think thirty five

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Speaker 3: percent chance that Gemini would have the best model by

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Speaker 3: the end of the year. Chad Gpt started the year ahead, right,

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Speaker 3: and you know, if you really for folks that really

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Speaker 3: kind of understood what was happening in the AI world,

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Speaker 3: it seemed like conventional wisdom was wrong. Right, you have Google,

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Speaker 3: who's on a steep trajectory, and they have all the data,

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Speaker 3: all the compute, they're highly motivated. I think now we

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Speaker 3: look at the Gemini release and it's like, well, it's

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Speaker 3: so obvious they had all these tools. But back then,

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Speaker 3: I think conventional wisdom was wrong. So I think for

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Speaker 3: a trader, it's going to open up more possibilities, and

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Speaker 3: you know, you can specialize in things because there's probably

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Speaker 3: at least one topic that each person understands better than

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Speaker 3: the average conventional wisdom. So I think it'll pull in

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Speaker 3: more traders. But I think the most interesting thing for

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Speaker 3: me is that it creates a new source of information.

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Speaker 3: It's almost like the new media or new news, or

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Speaker 3: instead of watching talking heads pontificating about what's going to happen,

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Speaker 3: you can just look at the market and then you'll

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Speaker 3: learn a little bit about what's likely or what's even

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Speaker 3: true in this world.

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