1 00:00:02,520 --> 00:00:09,280 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. Arizona has filed criminal 2 00:00:09,360 --> 00:00:12,200 Speaker 1: charges against cal She, accusing the company of operating an 3 00:00:12,200 --> 00:00:15,480 Speaker 1: illegal gambling business. To Max Tim snowk joins us now 4 00:00:15,680 --> 00:00:18,800 Speaker 1: with Kaushi Kofouna and CEO Tim take it away. Hi, 5 00:00:18,880 --> 00:00:21,560 Speaker 1: We're joined by Tarak Monsieur. He's the CEO and co 6 00:00:21,600 --> 00:00:23,799 Speaker 1: founder of Call She. Tarak, good to see you. Thanks 7 00:00:23,800 --> 00:00:24,599 Speaker 1: for joining us on this. 8 00:00:25,000 --> 00:00:25,239 Speaker 2: Look. 9 00:00:25,280 --> 00:00:28,120 Speaker 1: Even though other state regulators have taken steps to crack 10 00:00:28,200 --> 00:00:30,760 Speaker 1: down on what they say is unlicensed betting on call 11 00:00:30,840 --> 00:00:34,040 Speaker 1: She's site, Arizona appears to be the first to escalate 12 00:00:34,080 --> 00:00:38,199 Speaker 1: to criminal charges. What is your response to these charges? 13 00:00:39,240 --> 00:00:41,080 Speaker 2: Look, I mean, these charges have nothing to do with 14 00:00:41,720 --> 00:00:44,640 Speaker 2: gambling or the merits. If it was about gammling or 15 00:00:44,640 --> 00:00:46,680 Speaker 2: remote they would let the judicial process fright its course 16 00:00:46,680 --> 00:00:49,680 Speaker 2: in the federal courts. You know, five days ago on Thursday, 17 00:00:49,760 --> 00:00:52,839 Speaker 2: CALCI filed suit against Arizona and federal courts on the 18 00:00:52,880 --> 00:00:55,480 Speaker 2: mets on whether Calshi is subject. 19 00:00:55,200 --> 00:00:56,960 Speaker 3: To exclusive jurisdiction of the CFTC. 20 00:00:58,000 --> 00:00:59,840 Speaker 2: And you know, we're gone from an opposition and wanted 21 00:00:59,840 --> 00:01:01,280 Speaker 2: to let the court process play out. 22 00:01:01,400 --> 00:01:02,800 Speaker 3: And instead of letting that happen. 23 00:01:03,440 --> 00:01:06,480 Speaker 2: The Arizona Attorney General decided to subvert the judicial process 24 00:01:07,360 --> 00:01:09,360 Speaker 2: and weaponize it and go to state court and file 25 00:01:09,480 --> 00:01:12,759 Speaker 2: these criminal charges, which you know, we view as merit 26 00:01:12,760 --> 00:01:14,880 Speaker 2: lists and basis. We see this as a total overstep 27 00:01:15,400 --> 00:01:16,720 Speaker 2: and we look forward to finding it in court. 28 00:01:16,840 --> 00:01:18,440 Speaker 1: Well, experts are saying this could be the first of 29 00:01:18,880 --> 00:01:21,840 Speaker 1: many charges such as these from other states too. How 30 00:01:21,880 --> 00:01:23,360 Speaker 1: does it change your legal strategy. 31 00:01:24,280 --> 00:01:26,080 Speaker 2: Well, this is the whole point of federal preemption. So 32 00:01:26,400 --> 00:01:29,560 Speaker 2: this is not about camera. The charges that the attorney 33 00:01:29,640 --> 00:01:32,600 Speaker 2: general filed are not about gambling, they're not even about 34 00:01:32,760 --> 00:01:35,640 Speaker 2: sports only. They're about prediction markets writ large. It's just, 35 00:01:35,800 --> 00:01:38,880 Speaker 2: you know, attacking the entire business model. And nothing prevents 36 00:01:38,880 --> 00:01:41,200 Speaker 2: from the same attorney general or others from fighting the 37 00:01:41,240 --> 00:01:44,399 Speaker 2: same criminal charges against derivatives markets writ large. They could 38 00:01:44,400 --> 00:01:48,320 Speaker 2: file the same exact charges under the same analysis against 39 00:01:48,320 --> 00:01:51,480 Speaker 2: CME or Ice or NASTAC. And that's the whole point 40 00:01:51,600 --> 00:01:54,560 Speaker 2: of federal regulation of these financial exchanges is to prevent 41 00:01:54,600 --> 00:01:57,520 Speaker 2: this sort of chaos and these sort of attacks on 42 00:01:57,560 --> 00:02:00,320 Speaker 2: these businesses that could be political in nature or or other. 43 00:02:01,000 --> 00:02:02,440 Speaker 3: And that's a very important distinction. 44 00:02:02,480 --> 00:02:05,280 Speaker 1: Well, I read the charging document from the Attorney General 45 00:02:05,640 --> 00:02:08,919 Speaker 1: as twenty charges. They're mostly about betting and wagering when 46 00:02:08,919 --> 00:02:12,000 Speaker 1: it comes to sports, there's some election stuff in there. 47 00:02:12,639 --> 00:02:16,480 Speaker 1: Would you ever consider limiting your business in Arizona or 48 00:02:16,520 --> 00:02:19,720 Speaker 1: other states to things that these ags don't seem to 49 00:02:19,760 --> 00:02:23,920 Speaker 1: have problems with, like economic data, the price of bitcoin, 50 00:02:24,000 --> 00:02:26,680 Speaker 1: what markets are going to do predictions around those things. 51 00:02:27,639 --> 00:02:29,320 Speaker 2: Look, I mean the AGE also claimed that we have 52 00:02:29,400 --> 00:02:33,160 Speaker 2: war markets, which is incorrect. It's either flat out to 53 00:02:33,240 --> 00:02:36,320 Speaker 2: lie or it's misinformed take which is unfortunate for someone's 54 00:02:36,360 --> 00:02:39,080 Speaker 2: you know, filing criminal charges against the company. What's more 55 00:02:39,120 --> 00:02:41,040 Speaker 2: important here, again is this is not about the merits. 56 00:02:41,080 --> 00:02:43,720 Speaker 2: If it's about the merits, let's let the judicial process 57 00:02:43,760 --> 00:02:44,239 Speaker 2: run its. 58 00:02:44,080 --> 00:02:45,120 Speaker 3: Course in federal courts. 59 00:02:45,600 --> 00:02:48,680 Speaker 2: This is about something other than the merits, which is 60 00:02:48,680 --> 00:02:50,160 Speaker 2: what I'm focused on. I don't know what the AG 61 00:02:50,320 --> 00:02:52,280 Speaker 2: is focused on, but you know she is off for reelection. 62 00:02:53,400 --> 00:02:55,959 Speaker 2: You know, it does, it did some press, It does 63 00:02:56,000 --> 00:02:59,119 Speaker 2: seem to be making some buzz. But what I'm really 64 00:02:59,120 --> 00:03:01,760 Speaker 2: focused on is building create product for URM lends of customers, 65 00:03:01,800 --> 00:03:04,280 Speaker 2: out of which close to four hundred thousand are in Arizona, 66 00:03:04,360 --> 00:03:08,160 Speaker 2: and fighting any of these basless cases in courts, which 67 00:03:08,200 --> 00:03:09,520 Speaker 2: was which we're going to continue doing. 68 00:03:09,680 --> 00:03:11,880 Speaker 1: So you're fighting the cases. As I mentioned, Arizona is 69 00:03:11,880 --> 00:03:14,919 Speaker 1: not the only state to take issue with your business. 70 00:03:15,400 --> 00:03:19,640 Speaker 1: What happens ultimately if courts do side with states, what 71 00:03:19,680 --> 00:03:21,400 Speaker 1: does it mean for the future of your company. 72 00:03:22,040 --> 00:03:23,800 Speaker 3: We believe in the rule of law. 73 00:03:24,240 --> 00:03:27,000 Speaker 2: Right, we will always abide by court decisions. 74 00:03:27,440 --> 00:03:30,040 Speaker 3: The law applies to us, but it also applies. 75 00:03:29,680 --> 00:03:32,400 Speaker 2: To the government, including state governments, and that's a very 76 00:03:32,480 --> 00:03:33,440 Speaker 2: important thing. 77 00:03:34,040 --> 00:03:34,239 Speaker 3: Right. 78 00:03:34,800 --> 00:03:38,640 Speaker 2: This is really not about our business model. Again, if 79 00:03:38,680 --> 00:03:40,720 Speaker 2: it was about our business model, we would be focused 80 00:03:40,800 --> 00:03:45,080 Speaker 2: on the federal courts and the lawsuit about the merits. 81 00:03:45,800 --> 00:03:50,200 Speaker 2: This is a broader attack, and you know many states 82 00:03:50,240 --> 00:03:52,360 Speaker 2: have sided with us and have granted us a preliminary 83 00:03:52,400 --> 00:03:55,120 Speaker 2: in junction agreeing with our legal analysis. We have spent 84 00:03:55,160 --> 00:03:57,360 Speaker 2: four years getting regulated by the federal government, and we 85 00:03:57,400 --> 00:03:59,960 Speaker 2: have a federal government in the CFTC that is come 86 00:04:00,320 --> 00:04:03,760 Speaker 2: strongly in favor of our position. Following these charges is 87 00:04:03,800 --> 00:04:08,120 Speaker 2: a total total overstep and an overreach from an ag 88 00:04:08,280 --> 00:04:10,680 Speaker 2: that's up for reelection, and we find that unfortunate. But 89 00:04:10,720 --> 00:04:12,600 Speaker 2: we will stay focused on what we do best, which 90 00:04:12,600 --> 00:04:13,640 Speaker 2: is building a great product. 91 00:04:13,960 --> 00:04:17,479 Speaker 1: So certainly the CFTC. We know where the CFTC stands, 92 00:04:17,520 --> 00:04:20,479 Speaker 1: and we know where Michael Mike Selig stands on this. 93 00:04:20,839 --> 00:04:23,320 Speaker 1: We don't know where courts stand on this. And I'm 94 00:04:23,320 --> 00:04:28,000 Speaker 1: wondering if if we see a state like Nevada, for example, 95 00:04:28,120 --> 00:04:32,120 Speaker 1: block access to your business, what will you do? Will 96 00:04:32,120 --> 00:04:34,760 Speaker 1: you continue to operate or will you will you say, Okay, 97 00:04:34,960 --> 00:04:37,680 Speaker 1: we're not going to operate in Nevada. 98 00:04:38,560 --> 00:04:41,279 Speaker 2: Well, first of all, let's let's get to that point, 99 00:04:41,279 --> 00:04:42,520 Speaker 2: and you know, we'll have to make a decision as 100 00:04:42,520 --> 00:04:44,359 Speaker 2: the company what we do. What I can reiterate is 101 00:04:44,640 --> 00:04:46,600 Speaker 2: we will one hundred percent abye by the law. 102 00:04:47,640 --> 00:04:49,080 Speaker 3: That's what we will do as a company. It's always 103 00:04:49,080 --> 00:04:49,680 Speaker 3: been our position. 104 00:04:49,800 --> 00:04:53,520 Speaker 2: That's why we spend four years getting regulated upfront, regulatory 105 00:04:53,560 --> 00:04:55,080 Speaker 2: first as a company and. 106 00:04:55,080 --> 00:04:56,120 Speaker 3: Always abide by the law. 107 00:04:56,520 --> 00:04:58,200 Speaker 2: But what I always say, the law applies to us 108 00:04:58,240 --> 00:05:00,520 Speaker 2: as much as it applies to the government. And government 109 00:05:00,560 --> 00:05:03,200 Speaker 2: oversteps the law and goes out of bound, We're going 110 00:05:03,200 --> 00:05:05,240 Speaker 2: to fight that in court, which we look forward to. 111 00:05:05,839 --> 00:05:09,359 Speaker 1: How long does that process take? Because it seems like 112 00:05:09,400 --> 00:05:12,280 Speaker 1: there's a regulatory limbo happening. You're you're it's almost like 113 00:05:12,320 --> 00:05:13,680 Speaker 1: your legal team is going to have to play whack 114 00:05:13,720 --> 00:05:15,960 Speaker 1: the moll with all these states that are that are 115 00:05:16,200 --> 00:05:19,000 Speaker 1: filing suit or bring in criminal charges. How long is 116 00:05:19,000 --> 00:05:19,599 Speaker 1: this going to take? 117 00:05:20,200 --> 00:05:22,120 Speaker 2: And gladly we have a legal team to handle these 118 00:05:22,160 --> 00:05:24,120 Speaker 2: types of things and they're going to be focused on 119 00:05:24,160 --> 00:05:26,840 Speaker 2: and you know, maybe it's a question for them. I mean, look, 120 00:05:26,880 --> 00:05:29,760 Speaker 2: whatever long it takes, we're going to fight for prediction markets. 121 00:05:29,960 --> 00:05:32,440 Speaker 2: I spent eight years building this company, four out of 122 00:05:32,480 --> 00:05:34,360 Speaker 2: which I have a which are getting regulated upfront. 123 00:05:34,560 --> 00:05:35,880 Speaker 3: I really believe in this marketplace. 124 00:05:35,920 --> 00:05:37,919 Speaker 2: I'm very excited about the growth that we're seeing some 125 00:05:38,000 --> 00:05:40,600 Speaker 2: of the fast growing company companies in America right now. 126 00:05:41,520 --> 00:05:43,160 Speaker 2: And so what I'm going to be focused on is 127 00:05:43,240 --> 00:05:45,200 Speaker 2: keep building a great product, and that's what's sort of 128 00:05:45,240 --> 00:05:48,479 Speaker 2: most important for me. The more important sort of question is, 129 00:05:48,720 --> 00:05:51,200 Speaker 2: you know, when it comes to this is not really 130 00:05:51,200 --> 00:05:53,280 Speaker 2: about you know, whether this is gambling or not. This 131 00:05:53,360 --> 00:05:56,920 Speaker 2: is not really about state versus federal which are both 132 00:05:56,920 --> 00:06:00,159 Speaker 2: co existing and both growing both models. This really is 133 00:06:00,200 --> 00:06:02,960 Speaker 2: turning into sort of some special interests that like the 134 00:06:03,000 --> 00:06:03,480 Speaker 2: status quo. 135 00:06:03,560 --> 00:06:04,640 Speaker 3: The status always worked. 136 00:06:04,480 --> 00:06:06,760 Speaker 2: Very well for monopolies, but not for the consumers that 137 00:06:06,800 --> 00:06:08,440 Speaker 2: are flocking to prediction markets right now. 138 00:06:08,760 --> 00:06:10,360 Speaker 3: Which we're going to keep plighting for Tark. 139 00:06:10,440 --> 00:06:14,719 Speaker 1: There is this perception though that people think this is gambling. 140 00:06:14,880 --> 00:06:17,880 Speaker 1: An IPSOS survey from just a few weeks ago, for example, 141 00:06:18,160 --> 00:06:20,839 Speaker 1: show sixty one percent of adults safe prediction market trading 142 00:06:20,920 --> 00:06:24,440 Speaker 1: is closer to gambling. Eight percent say it's closer to investing. 143 00:06:24,720 --> 00:06:27,640 Speaker 1: So there is this public perception that doesn't necessarily match 144 00:06:27,680 --> 00:06:30,960 Speaker 1: with what you say. The platform is how do you 145 00:06:31,000 --> 00:06:32,760 Speaker 1: respond to that and how do you battle that? Like, 146 00:06:32,800 --> 00:06:34,080 Speaker 1: how is this not gambling? 147 00:06:34,839 --> 00:06:38,919 Speaker 2: I haven't really looked at these polls, you know. The 148 00:06:39,080 --> 00:06:41,720 Speaker 2: thing I will say is there's always been a battle 149 00:06:41,760 --> 00:06:45,000 Speaker 2: of whether financial derivatives are gambling. Great features were called 150 00:06:45,000 --> 00:06:47,719 Speaker 2: gambling and the eighteen hundreds, and there was a Supreme 151 00:06:47,720 --> 00:06:50,359 Speaker 2: Court decision that you know, said even though there's speculation, 152 00:06:51,120 --> 00:06:54,719 Speaker 2: these you know, products have financial our structures the financial markets, 153 00:06:54,720 --> 00:06:57,040 Speaker 2: and thus are going to fall under financial market jurisdiction. 154 00:06:57,600 --> 00:07:00,080 Speaker 2: So I always say this, you know, whether it's something 155 00:07:00,160 --> 00:07:03,160 Speaker 2: feels and looks like gambling doesn't necessarily make it gambling. 156 00:07:03,240 --> 00:07:06,200 Speaker 2: Speculation exists in all financial markets. If we're going to 157 00:07:06,240 --> 00:07:09,359 Speaker 2: take a line that speculation is gambling, then the stock 158 00:07:09,400 --> 00:07:12,960 Speaker 2: market with retail participation is gambling, then buying options for retail, 159 00:07:13,000 --> 00:07:14,920 Speaker 2: or is your data to expire options is gammling, then 160 00:07:14,960 --> 00:07:18,160 Speaker 2: retail buying crypto is gambling. The more important line in 161 00:07:18,200 --> 00:07:20,640 Speaker 2: the historical line that we've been taking under the law, 162 00:07:20,760 --> 00:07:23,800 Speaker 2: but also as you think about it societally. Is the 163 00:07:23,840 --> 00:07:26,960 Speaker 2: business model a gambling business model, which is a model 164 00:07:26,960 --> 00:07:29,080 Speaker 2: where the revenue of the business and the profits are 165 00:07:29,120 --> 00:07:31,840 Speaker 2: equal to the customer's losses, in which case the incentive 166 00:07:31,880 --> 00:07:34,080 Speaker 2: is to promote more losses and blog the winners. Or 167 00:07:34,120 --> 00:07:36,720 Speaker 2: is it an open, free and fair marketplace where people 168 00:07:36,760 --> 00:07:39,880 Speaker 2: can enter in and out freely and transparently, which is 169 00:07:39,920 --> 00:07:42,000 Speaker 2: a financial exchange, in which Calci falls under. 170 00:07:42,720 --> 00:07:46,600 Speaker 1: Tark Monsieur Calci co founder and CEO. Tark always good 171 00:07:46,600 --> 00:07:48,680 Speaker 1: to speak with you. Thanks so much for joining us.