Speaker 1: Hello, and welcome to What Goes Up, a weekly markets podcast.
Speaker 1: My name is Mike Reagan. I'm a senior editor at Bloomberg,
Speaker 1: and then Donna h a cross asset reporter with Bloomberg.
Speaker 1: This week on the show, well, they were calling it
Speaker 1: the crypto Winner. The value of big coins like Bitcoin
Speaker 1: and Ether were cut in half and a little more
Speaker 1: than two months, and many of the smaller coins fared
Speaker 1: even worse. But there have been some green shoots since
Speaker 1: late January and crypto values have perked back up again.
Speaker 1: What does it all mean for the huge ecosystem of
Speaker 1: products that have grown up around crypto. We'll talk to
Speaker 1: the CEO of a company that provides exchange traded crypto
Speaker 1: products about what he's expecting in the coming year. But first,
Speaker 1: fill Donna all this talk about crypto winner. Has been
Speaker 1: thinking about groundhogs? Or do you say will break Groundhog Day?
Speaker 1: Doesn't everybody? Don't? We all sort of watch and see
Speaker 1: what happens because we want the winter to end. We do.
Speaker 1: And there's very sort of ominous news in New Jersey.
Speaker 1: Did you know there are local groundhog in New Jersey?
Speaker 1: Melville Millville mel actually dropped dead right before he was
Speaker 1: supposed to see his shadow or not. I find that
Speaker 1: I find that ominous. Yeah, it is pretty ominent. I
Speaker 1: don't know what. I don't know what that means. But
Speaker 1: I think we need a groundhog for crypto winners, maybe
Speaker 1: like an n f T. Like if bitcoins down, you
Speaker 1: have a groundhog n f T that comes out and
Speaker 1: sees the shadow or not? What how would you How
Speaker 1: would you get it to pop its head out of
Speaker 1: the ground. It has to be I think it has
Speaker 1: to be triggered by like a forty percent drop and
Speaker 1: pick coin and then it comes out, and it could
Speaker 1: be a coin toss too. I was reading apparently punks
Speaker 1: a tawny phil the most famous groundhog only has a
Speaker 1: track record that compares his to his benchmark of a inflip,
Speaker 1: and he's trailing his benchmark terribly. So I don't you know,
Speaker 1: I think a good n f T crypto groundhog can
Speaker 1: beat him. I don't know. I'm throwing it out there
Speaker 1: if there's any developers out there listening. It's a weird idea.
Speaker 1: That's a free, free idea for me that I'm sure
Speaker 1: no one's no one's probably gonna take up. But I
Speaker 1: do what I can possibly our guests might have some
Speaker 1: thoughts on this. I don't know if I'm sold on it,
Speaker 1: but I want to welcome Honey Raschwand he's the co
Speaker 1: founder and CEO of twenty one Shares and a Moon,
Speaker 1: and Honey, I want to thank you for joining us.
Speaker 1: Of course, thanks for having it. I want to get
Speaker 1: into your sort of outlook for for crypto in general.
Speaker 1: But it's a lot of listeners might not be very
Speaker 1: familiar with twenty one shares. It's funny because in the
Speaker 1: US we sort of fixate on, you know, the SEC
Speaker 1: being very slow in approving uh bitcoin or other crypto
Speaker 1: ETFs around the world, though it's flourishing. I mean, twenty
Speaker 1: shares has a bunch trading in European markets, So up
Speaker 1: to us a little bit about some of your biggest
Speaker 1: products where they're trading, how how much assets are involved,
Speaker 1: that sort of thing. If you can't tell by my voice, Um,
Speaker 1: I did grow up in America as well, and so
Speaker 1: did my co founder, and so the fact that we
Speaker 1: actually built the company in Switzerland was very much on purpose.
Speaker 1: What we were just looking to do at the beginning
Speaker 1: was put crypto in a safe, accessible, known package. Or rapper.
Speaker 1: For a lot of people, buying e t S is easier.
Speaker 1: For some people, buying e t S is necessary. And
Speaker 1: we couldn't find any of these products out there. There
Speaker 1: were numerous reasons why not, but we sort of scoured
Speaker 1: the globe. We we We spoke to twenty seven different jurisdictions,
Speaker 1: different regulators around the world before settling on Switzerland and
Speaker 1: then using Switzerland as a base too from which to expand.
Speaker 1: The first product we we launched was actually a bit
Speaker 1: of a complicated product. I think people assume we did
Speaker 1: the Bitcoin ETP first. No, we we first listed the
Speaker 1: uh what was the world's first and only index one
Speaker 1: and so it was an index of the top five
Speaker 1: cryptos represented the market, was just a single share and
Speaker 1: it was the first time that anything globally had been
Speaker 1: listed on a stock exchange that was physically back. Now
Speaker 1: that doesn't mean some people listed things and said they
Speaker 1: were physically back, but there's no guarantee. It's not in
Speaker 1: the product structure itself. These are physically back commodity e
Speaker 1: tps and we put crypto it. At the moment, I
Speaker 1: think we have maybe two and a half billion or
Speaker 1: so spread across about total products. We're going to double
Speaker 1: maybe triple the product suite this year, and we cover
Speaker 1: everything from a single assets like the most popular ones
Speaker 1: bitcoin ethereum, to some less popular ones or more let's say,
Speaker 1: more esoteric, younger ones like Polka Dot or chain link
Speaker 1: or Solana or binance coins. We also have a bunch
Speaker 1: of index is if you want to buy thematic baskets
Speaker 1: and that kind of thing. Uh. And we also have
Speaker 1: the only bitcoin short in an ETP format, and so
Speaker 1: we have a single bitcoin short at the moment. It's
Speaker 1: in Switzerland, Austria, Germany, Holland, France, Sweden. I think we
Speaker 1: announced that we're bringing Australia it's first bitcoin and ethereum ETPs.
Speaker 1: They're classified as at S there actually uh. And we're
Speaker 1: going to do the same with brand new region in
Speaker 1: the next couple of months. And so that's sort of
Speaker 1: where we're at by both assets as well as number
Speaker 1: of products. Certainly, we are the world's largest issue of
Speaker 1: crypto ETPs and we were the ones that first brought
Speaker 1: it to market a couple of years ago. Amazing, yeah,
Speaker 1: just a few years. I mean the company's two thousand
Speaker 1: and eighteen. You were started, so that's a lot to
Speaker 1: get done in a few years. We're three years old. Yeah,
Speaker 1: I think we're three years old. In a couple of
Speaker 1: months now. I think this this is my third startup.
Speaker 1: It is the quickest of product market fit. Now. It
Speaker 1: wasn't instantaneous. I remember launching in November with at the
Speaker 1: time five million in seated capital, which we slaved away
Speaker 1: to raise, having never been in e t F before,
Speaker 1: and just the price action of crypto. This was a
Speaker 1: basket of the top five. We launched the first day
Speaker 1: with five million. On Thursday day two, second day of trading,
Speaker 1: three point five three point seven millions, and so that
Speaker 1: was the the drop in just one day. I mean, actually,
Speaker 1: it took us a really quite some time to get
Speaker 1: to an acceptable, respectible level and then from there. I
Speaker 1: don't remember going from twenty to twenty million to two
Speaker 1: billions again. I remember being in the range of thirty million,
Speaker 1: and then all of a sudden, we're now talking about
Speaker 1: two to three billion. A lot of people have have
Speaker 1: used it, but I think it just it speaks to
Speaker 1: the product market fit here. A lot of people were
Speaker 1: looking at this. Why a few folks on the crypto
Speaker 1: side were scoffing at the people that would buy crypto
Speaker 1: using an e T S or wasn't as exciting adventure
Speaker 1: to pursue. Everyone thought it was impossible to do, or
Speaker 1: maybe if it's not listed in America, it doesn't matter.
Speaker 1: Various other viewpoints there that we happen to disagree with
Speaker 1: took a contrarian opinion, and here we are, so, honey,
Speaker 1: can you actually talk about the regulation in Europe and
Speaker 1: how that regulation actually allows for your products to exist
Speaker 1: over there, whereas over here in the US we have
Speaker 1: a bitcoin futures product and everybody is still sort of
Speaker 1: waiting for that holy grail bitcoin spot e T F.
Speaker 1: So when we okay, when we say Europe as it
Speaker 1: applies to us specifically, there are two Europe. There's Switzerland
Speaker 1: and then there's the European Union, and the regulations are
Speaker 1: a bit different. Switzerland has a very very rich history
Speaker 1: of costuming and trading commodities like think about swizz gold,
Speaker 1: baults and that kind of thing, and so it was
Speaker 1: actually be one of the easier conversations with regulators that
Speaker 1: that we had was here in Switzerland, because very very
Speaker 1: quickly they got it. We said, we want to wrapper
Speaker 1: for physically backed, instored in our vaults gold. We wanted
Speaker 1: to have these characteristics. We don't want the ability or
Speaker 1: power as an issuer to take the money out. We
Speaker 1: wanted to be guaranteed, and we wanted to trade in
Speaker 1: this way. We wanted for retail and institutional and they said, great,
Speaker 1: here is a package. And then towards the very end,
Speaker 1: I remember say yes, but it's digital, that's the only thing.
Speaker 1: And so instead of physical bars, we're gonna, you know,
Speaker 1: put laminated pieces of paper or platinum plates or whatever
Speaker 1: within custody vaulting and do it that way. And so
Speaker 1: the Swiss really understood that they got it. There was
Speaker 1: also a tremendous amount of political agreement, and not like
Speaker 1: we're seeing in America where it's a little bit more
Speaker 1: partisan than I would want it to be, but in
Speaker 1: in Switzerland, which is quite part is in itself. Everyone
Speaker 1: agrees that this the crypto nation and they should have
Speaker 1: a stake in the future here, and it's a very
Speaker 1: important thing for them. And so we get we get
Speaker 1: that treatment, and then we help the country build this
Speaker 1: entire program of having been the first to do it,
Speaker 1: and and so very good relationship there. Europe is a
Speaker 1: bit different in that there is a passporting scheme and
Speaker 1: so once you get approved in one European country for
Speaker 1: X license, oftentimes you can passport it across the rest
Speaker 1: of the European Union, all the other twenty seven countries,
Speaker 1: and so that was basically how we've done it, which
Speaker 1: is why in some areas of Europe where the regulator
Speaker 1: may not be the most bullish crypto, we still may
Speaker 1: have listings just based on precedent passporting and doing all
Speaker 1: of those various things. But we have a very good
Speaker 1: relationship with the German regulator. Germany is the largest on
Speaker 1: me in Europe and that's something that we feel very
Speaker 1: very good about. On the US and regulations can't comment
Speaker 1: too much with any specifics. We do have a filing
Speaker 1: that I think it's public news that we've filed with
Speaker 1: Cathy Wood and ARC as well as twenty one shares.
Speaker 1: I guess here's what I could talk about. We filed
Speaker 1: to files. One was futures and one was physical, and
Speaker 1: we have pulled the futures file. We were tracking and
Speaker 1: trying to see what people were looking for, how people
Speaker 1: would react to it, and in the end it wasn't
Speaker 1: the product quality that we wanted from the beginning. We
Speaker 1: could have listed private trusts with premiums to uh net
Speaker 1: asset value. We could have done things that have greater
Speaker 1: counterparty with We could have done things that would have
Speaker 1: made us more money. And we've shied away from bad
Speaker 1: product built in bad product quality because we don't think
Speaker 1: you can as easily replace any of these things over
Speaker 1: time and its compounds and all of a sudden you
Speaker 1: have a crappy company, right, And so we really didn't
Speaker 1: want to do that. We thought, maybe there's enough liquidity,
Speaker 1: maybe this, maybe that. But I think that the data
Speaker 1: across the board shows that sends the futures et f launch.
Speaker 1: It doesn't track the price of bitcoin, which one would
Speaker 1: argue is the most important thing, and then it has
Speaker 1: myriad other issues as well, given that it's built on futures.
Speaker 1: Physical is the way to go. Physical is how we've
Speaker 1: done it so far in probably a dozen countries, and
Speaker 1: we will continue making our case. And I can honestly
Speaker 1: say that everyone we're speaking to is listening with open
Speaker 1: ears and is willing to have a conversation, which is
Speaker 1: all that you can really expect and hope for here.
Speaker 1: And we will along with the rest of the community
Speaker 1: try and work very hard to bring America an easier
Speaker 1: way of accessing with the cryptos. Well, honey, I gotta say,
Speaker 1: if you have to live through a crypto winner in
Speaker 1: the middle of a regular winner, Switzerland seems like a
Speaker 1: good place to do it. I hope, I hope you
Speaker 1: ski a little bit, uh while you're there. I'll tell
Speaker 1: you this. Recently, the blizzards in New York are far
Speaker 1: secure whatever interesting. Alright, so we are getting we are
Speaker 1: getting the shirt in. But I wanted to sort of
Speaker 1: gauge your mood and and what you sense as the
Speaker 1: mood of the industry after this this nasty sell off
Speaker 1: in in crypto that we've seen since November. Um, you know,
Speaker 1: obviously the space was just flourishing. I I know, you
Speaker 1: had really ambitious hiring plans. You're gonna hire more than
Speaker 1: a hundred people or something like that this year. And
Speaker 1: obviously that's that's the story you hear all over the place,
Speaker 1: people really ramping up and and and really interesting projects
Speaker 1: and a lot of venture capital coming in, and and
Speaker 1: on and on. Does this price action change the temperature
Speaker 1: at all? Does it change the mood in the industry?
Speaker 1: Make you sort of second guess any plans or anything
Speaker 1: like that. Uh, you know, how are you thinking about it? Look,
Speaker 1: I think this is a very very interesting question because
Speaker 1: by all means, Crypto is not the only one that
Speaker 1: it faces these kinds of things. Like I think, I
Speaker 1: remember when I when I did my first startup, I
Speaker 1: dropped out, I moved to California. It was the Sequoia
Speaker 1: Capital's rest in piece good Times power point presentation, because
Speaker 1: that's how the market was. And like I remember my
Speaker 1: first round that I ever raised was on a today
Speaker 1: relatively small cap. I think it was three or four million.
Speaker 1: It was three million the first time, four million the
Speaker 1: second time around. And it's it's it's a very very
Speaker 1: very different world. Of course, it changes the scene. People
Speaker 1: are more careful. I forget who said this. It was.
Speaker 1: It was a seat station investor. I think it might
Speaker 1: have been Michael Deering. And it's it's the most perfect way.
Speaker 1: I think during downturns, we all know a Kleenex box,
Speaker 1: and based on whether we have just opened it or
Speaker 1: if there's only four kleenex is left and it's nighttime,
Speaker 1: our use of the Kleenex is going to radically change.
Speaker 1: It's the same thing here now, and so I think
Speaker 1: all of a sudden, companies that were more casually doing
Speaker 1: a million dollars sponsorships for conferences of mostly crypto insiders
Speaker 1: are probably rethinking. Some of these companies that were not
Speaker 1: on solid footing. Well, you know, now now we see
Speaker 1: who's swimming without any swim trunks. Now a lot of
Speaker 1: sunlight is the best disinfectant here, and so I think
Speaker 1: it makes everybody more careful, which is probably why the
Speaker 1: data shows that downturns are better times to build companies.
Speaker 1: Not everything is going well, you have to make sacrifices.
Speaker 1: You have to think about this or that, which is
Speaker 1: a new paradigm ship for our industry. But you are
Speaker 1: honest with yourself. You're intellectually honest with yourself. You've seen
Speaker 1: this coming. If you're careful, you've seen this coming. If
Speaker 1: you're in crypto, that's for sure, because you know we
Speaker 1: we do these normally and will continue to do them
Speaker 1: for for quite some time, and you care for it.
Speaker 1: So we still have all of these hiring plans. We
Speaker 1: have forty or fifty open positions. Were a hundred and
Speaker 1: twenty five people now up from twenty. I think or
Speaker 1: so about a year ago. But we've been, you know,
Speaker 1: an intelligent squirrel during the bull market and really stored
Speaker 1: up to make sure that we not only are safe
Speaker 1: now but can can be opportunistic in case something comes up.
Speaker 1: We were widely profitable, we remained pretty profitable. But I
Speaker 1: think the extra attention to detail is something that I
Speaker 1: certainly missed during the bull markets where everyone's a genius
Speaker 1: and I wish the prices were higher, I always do,
Speaker 1: but I know they'll be higher a year from now,
Speaker 1: and I would much rather be in this position than
Speaker 1: than anything else. It's also all cyclical, and relatively speaking,
Speaker 1: every metric you've said so like bitcoin or ethereum dropping
Speaker 1: by half as compared to what date, because I think,
Speaker 1: you know, a year out, we're all up, we're all
Speaker 1: beating the SMP. Well, I haven't sold any crypto for years,
Speaker 1: so how how am I? And I think we have
Speaker 1: to really consider all of these things, especially in an
Speaker 1: area like crypto where a lot of us are very
Speaker 1: very trained holders and it's part of the culture. Something
Speaker 1: interesting that I actually noticed is a bunch of research
Speaker 1: reports that I've been getting in my inbox have been
Speaker 1: pointing out that there actually have been slight inflows into
Speaker 1: a bunch of crypto products over the last couple of weeks,
Speaker 1: and and even if there are outflows, they're really miniscule.
Speaker 1: And I looked at the bitcoin features E t f S,
Speaker 1: the ones offered in the US, and they've seen no
Speaker 1: outflows at all. And I'm just wondering why you think
Speaker 1: that might be, given that there is so much attention
Speaker 1: at the recent draw down. I think it depends on
Speaker 1: the person, because every every person sort of in crypto
Speaker 1: for a slightly different reason. Those that are investing in
Speaker 1: crypto because of political risk, what has changed. Nothing. Those
Speaker 1: that have invested in crypto because they're worried about increased inflation.
Speaker 1: What has changed. Part of the equation has changed, which
Speaker 1: is why the prices have moved. But largely that thesis,
Speaker 1: if you're a long term holder, still applies. Those that
Speaker 1: have invested in crypto as a VC case, like a
Speaker 1: lot of I think tokens can be looked at as
Speaker 1: VC project. Of course they're going to hold that. That's
Speaker 1: the whole point, and so I think that's how we
Speaker 1: have to think about it. Really, A few of our
Speaker 1: competitors have customer profiles that are far different from us,
Speaker 1: and they're inflows, outflows. Activities as a result, even in
Speaker 1: the good time, are just different from us. We don't
Speaker 1: really attract too many traders. We attract long term holders.
Speaker 1: Our AUM tends to be among the stickiest in the
Speaker 1: space as a result of what is predominantly family offices,
Speaker 1: private banks and fund managers that hold the ball of
Speaker 1: the au M of the product, and the healthy dose
Speaker 1: of retail that give it act. But you know, I'm
Speaker 1: not surprised by the data. Our data shows the same.
Speaker 1: It's it's it's a little too soon, but I think
Speaker 1: we've come close to maybe inflows in the last thirty days,
Speaker 1: which is very good. Actually, you know, a couple of
Speaker 1: days of outflows, but overall for the month, net inflows
Speaker 1: and the outflows weren't nearly serious. You're in an industry
Speaker 1: that talks a lot about in ten years we will
Speaker 1: be x and as a result, you get a lot
Speaker 1: of people in the industry that invest with that time horizon.
Speaker 1: A lot of people are trying to get rich quick,
Speaker 1: but they tend to be uh, sort of flushed out
Speaker 1: in these market movements. Honey, I want to rewind a
Speaker 1: little bit to something you said that I've been thinking
Speaker 1: a lot about, and that's sort of the partisanship. Uh no,
Speaker 1: when it comes to politics and crypto now here. You're
Speaker 1: a guy who's you know, flown around to how many
Speaker 1: jurisdictions twenty First of all, I wish I had your
Speaker 1: frequent flyer miles. They must be you can probably get
Speaker 1: a trip to the moon at this point. But but
Speaker 1: I'm curious, you know, tell me if I'm wrong in
Speaker 1: sort of simplifying it to the to the idea that
Speaker 1: it seems like the conservative side, the right side of
Speaker 1: the political aisle is very much sort of pro crypto,
Speaker 1: hands off regulation and the and the left side is
Speaker 1: more cautious at once tighter regulations, more restrictions. Is that
Speaker 1: too simplified of a way to think of it, or
Speaker 1: from your experiences, is that sort of what's going on.
Speaker 1: I think that's not a bad summary. I haven't thought
Speaker 1: about it under those models. I think it's I think
Speaker 1: it's fairly interesting. I I I've always looked at this
Speaker 1: as even earlier than that, in that none of the
Speaker 1: commentary that I'm hearing on the bearer's side, left or
Speaker 1: right makes sense. So it there there's an element there
Speaker 1: of you know how, at the very beginning of crypto,
Speaker 1: we were getting a ton of this is only used
Speaker 1: for drugs, and at some point we were getting this
Speaker 1: is only going to be used by criminals and terrorists,
Speaker 1: and that narrative has largely died due to data, to
Speaker 1: the anecdotal evidence, due to monitoring on exchanges, the professionalizing, etcetera.
Speaker 1: And I would say the same thing here as well.
Speaker 1: A lot of the comments that I'm hearing are about
Speaker 1: this is going to exacerbate income inequality as an example, right,
Speaker 1: and so very that's very clearly something that is a
Speaker 1: commentary from the left. That's that's unhelpful. And I'll mention
Speaker 1: one on the right as well, just to be fair.
Speaker 1: But it's unhelpful mostly because it's not true. Right. My
Speaker 1: co founder of Failure loves crypto in part because of
Speaker 1: female and women empowerment in the developing world, suddenly having
Speaker 1: access or being able to have access to finances, which
Speaker 1: has proven to be better for families overall. Anyone anywhere
Speaker 1: in America elsewhere can suddenly plug into a financial system
Speaker 1: that is global in nature. There's there's a ton that
Speaker 1: the left with love about crypto. It's just not properly explained.
Speaker 1: On the right, I think I've heard some things about
Speaker 1: how this is quite negative for the United States, it
Speaker 1: should be squashed. Maybe China or Russia are behind this
Speaker 1: in order to destroy the dollar or to control it
Speaker 1: or whatever. It's very clear based on Russian and Chinese
Speaker 1: actions that they are similarly confused, right, And I think
Speaker 1: it's just it's a bit early. But to me, bitcoin
Speaker 1: is is pretty American. It's what's one of the most
Speaker 1: American things I would say has ever been invented build
Speaker 1: on sovereignty as a concept, let alone sovereignty in the
Speaker 1: digital age, which is which is both American individual liberties
Speaker 1: and freedom combined with American ingenuity and innovation. Right, this,
Speaker 1: this thing, this entire asset class is super American, which
Speaker 1: is why a lot of people that happened to the
Speaker 1: Americans are in the industry and a lot of American
Speaker 1: dollars are in the industry. But it would be a
Speaker 1: shame if America missed out on this, and I think
Speaker 1: America can really benefit from this in myriad ways. One
Speaker 1: is the bitcoin mining and we've been seeing what states
Speaker 1: like Texas are doing to incentivize Chinese mistakes ultimately of
Speaker 1: destroying the their own mining industry. But we should see
Speaker 1: the same thing. Right now, American exchanges don't seem to
Speaker 1: be as competitive as global exchanges based on revenues, based
Speaker 1: on market share, based on kind of products, and and
Speaker 1: and I would I would argue that we have been
Speaker 1: falling behind on a couple of things. We've been doing
Speaker 1: well on say mining and a few other topics, but overall,
Speaker 1: I wouldn't say that it is the best place to
Speaker 1: do DeFi best place to be crypto And you know,
Speaker 1: boy should it be? And we make that case privately
Speaker 1: UM as a company, h and we will continue to
Speaker 1: do so. I forgot already what were you used to
Speaker 1: describe some of the I think it was esoteric products,
Speaker 1: So you had mentioned Salona, Polygon, a bunch of other
Speaker 1: e t p s. So I'm wondering which of your
Speaker 1: products you're seeing the most investor interest and why that
Speaker 1: might be. We look at two metrics. One is just
Speaker 1: generally speaking, what are our biggest products, and those tend
Speaker 1: to be the usual suspect Bitcoin, Ethereum, the basket, etcetera.
Speaker 1: We also get a lot of attention with bringing accessibility
Speaker 1: to ask that are even in the West generally inaccessible.
Speaker 1: I don't know if they launched it yet, but I
Speaker 1: don't think so. And I think for the longest time
Speaker 1: polka dot has been wanted by coin base and just
Speaker 1: not there. I think they they in the end listed it,
Speaker 1: but there was a time period where we were the
Speaker 1: only way to access polka dot in the West. Certainly
Speaker 1: that is the case for Binance, which is a very
Speaker 1: good product for US finances by far the world's largest exchange,
Speaker 1: and mostly people in the West really don't know too
Speaker 1: much about it, like as on a retail level, and
Speaker 1: we are one of the few, maybe only way in
Speaker 1: a regulated fashion to purchase this asset in the West,
Speaker 1: and so you get a lot of attention. The other
Speaker 1: metric that we look at besides just overall, what are
Speaker 1: our biggest product, and really it's just the usual suspect
Speaker 1: is time that it takes to get to a hundred
Speaker 1: million dollars in a one because that actually shows there
Speaker 1: are some products that that list and then soar to
Speaker 1: a hundred millions, are products that take another two years
Speaker 1: and still haven't hit a hundred uh and on those
Speaker 1: basically all the layer, all the layer ones and layer
Speaker 1: two's that we've launched everything that you could see as
Speaker 1: either an Ethereum competitor or compliment, depending on how you
Speaker 1: look at has been soaring, and it's been soaring in
Speaker 1: the summer, and it's been soaring since we've listed it.
Speaker 1: And so it's Lana Avalanche Polygone, very very popular launches
Speaker 1: Cosmos right now because you know, Mikey brought this up
Speaker 1: bear market even though I think the podcast is the
Speaker 1: price goes out for something, right what goes up? Yes,
Speaker 1: you didn't even know the name right now, but it's okay.
Speaker 1: But yeah, I think I think even if if you
Speaker 1: were to look at the bear market right now, Cosmos
Speaker 1: is and we happen to have I think the only
Speaker 1: Cosmos product in the world, So all in all, we'll
Speaker 1: still see strong influence to that point, you know, honey.
Speaker 1: Before every podcast, the Albanna gathers up a list of
Speaker 1: about three d and forty seven questions for for the guests,
Speaker 1: and uh, unfortunately we never get to all of them,
Speaker 1: but she has got a good one on on her
Speaker 1: list that I'm gonna steal because we are running out
Speaker 1: of time, and it's about basically the notion of institutional
Speaker 1: investors and decentralized finance. Um, do you see an interest
Speaker 1: from institutions to get into defy? If that, what will
Speaker 1: it sort of take to get them involved. I feel
Speaker 1: like institutions are just finally worming up to sort of
Speaker 1: the big cryptos Um. Are they ready to sort of
Speaker 1: go into the rabbit hole of defy? And if I
Speaker 1: can tack one more question on that, you know, the
Speaker 1: barrier tentry is so low that there's so many projects,
Speaker 1: so many coins going out there is that a hazard
Speaker 1: to the space when you have so much supply of
Speaker 1: new stuff coming in, does that sort of water down
Speaker 1: dilute you know, the potential worth of of of all
Speaker 1: the projects. Yeah? Absolutely, So let me answer your your
Speaker 1: second question first, because that's an easy question. There's about
Speaker 1: two million apps maybe more on the Apple App Store.
Speaker 1: There's I think three to four million on the Google
Speaker 1: Play Store. We're not that concerned about good mobile apps
Speaker 1: taking off. There's going to be a ton of noise.
Speaker 1: It is our opinion that there's going to be more tokens,
Speaker 1: not less. Because we're starting to see this, you see it,
Speaker 1: especially with the n f T s. It's very possible
Speaker 1: that instead of subscriptions, we get n f t s,
Speaker 1: or we get tokens that represent something like that is
Speaker 1: very possible that for a bunch of aspects of our lives,
Speaker 1: we will you know, add on top of it some
Speaker 1: crypto element, which is quite interesting. And so if anything,
Speaker 1: we're going to see more tokens, not less. There will
Speaker 1: still only be the top top ones. Maybe it's ten,
Speaker 1: maybe it's twenty, maybe it's five. Uh, and so it
Speaker 1: still makes sense to invest in the in the big ones,
Speaker 1: the ethereums and their compliments and competitors, the bitcoins, etcetera.
Speaker 1: But overall, I would assume if if we really think
Speaker 1: this will go to a hundred trillion dollars, it's it's
Speaker 1: not inconceivable for a bunch of random tokens to get
Speaker 1: tens or hundreds of billions in market cap. And you're
Speaker 1: seeing it right now like it's super early. We have
Speaker 1: defy assets with tens of billions in market cap. Once
Speaker 1: it goes a step or two more in adoption, those
Speaker 1: same asthlets would be hundreds of billions or or maybe
Speaker 1: low trillions if you really extrapolated up, and we would
Speaker 1: see that something quite similar. Institutions have an incredibly long
Speaker 1: term perspective, which is very helpful. Here. Institutions have a
Speaker 1: ton of money, which is very helpful. Here. Institutions move
Speaker 1: very quickly, and they have an incredible amount of needs,
Speaker 1: and so that's not helpful. Institutions are not here. Uh,
Speaker 1: they're on the way, but sure everyone is on the
Speaker 1: way to something. I think they still need a lot,
Speaker 1: especially if you're talking about big pension funds and insurance
Speaker 1: companies and the like. The good thing is that they're
Speaker 1: looking at falling bond yields, issues with interest rates absolutely
Speaker 1: low yield, sometimes negative, like in Switzerland it's negative seventy
Speaker 1: five basis points what the bank charges you on your balance,
Speaker 1: and they're seeing all of that and they need to
Speaker 1: do something about it. So they are actually some of
Speaker 1: the best conversations we have. But they are the conversations
Speaker 1: we have that we know will take another two, three, four,
Speaker 1: maybe five years to materialize into anything. And that's fine,
Speaker 1: you continue to invest in that, but I think it
Speaker 1: will be a while before this really tips the scale.
Speaker 1: Which makes this such a unique asset because I'm pretty
Speaker 1: sure that most asset classes are first embraced by the institutionals.
Speaker 1: Honey frequent listeners of Price Goes Up know that Mike
Speaker 1: likes to ask multiple multipart questions. So I have a
Speaker 1: two part question for you as well. One one is
Speaker 1: parts that's amateur. It's amateur, but it's it's big for me.
Speaker 1: I usually like to keep it just one question. One
Speaker 1: is it is Mike you might learn from that? Uh.
Speaker 1: One is we mentioned that you are the co founder
Speaker 1: of A Moon and I wanted to ask you to
Speaker 1: talk about a Moon a little bit because the reason
Speaker 1: that you and I originally started talking is and the
Speaker 1: reason I wanted to have you on the podcast is
Speaker 1: that you were telling me about index tokens, and so
Speaker 1: can you tell us what our index tokens? Describe why
Speaker 1: you guys started working on this for our listeners. And
Speaker 1: really it was the very first time I had heard
Speaker 1: about them when when I when you told me about them,
Speaker 1: So all of those details would be great. Absolutely. I
Speaker 1: think it's all about the end consumer when you think
Speaker 1: about it. If our mission is to make crypto marks
Speaker 1: a sessible and what we see ourselves doing is just
Speaker 1: building bridges into the crypto world, if you want to
Speaker 1: take that analogy to the limit, then there are different
Speaker 1: vehicles for different people on that bridge. And that's sort
Speaker 1: of how we see tokens overall, just conceptually, is that
Speaker 1: for some people the product that makes the most sense
Speaker 1: is an e t F my mother for example, a
Speaker 1: fund manager for example. But for some people, and this
Speaker 1: could be either a mix of maybe someone is more
Speaker 1: technically savvy and technical and crypto forward. But and this
Speaker 1: is where it's really important to us and how we've
Speaker 1: initially thought about it. Maybe they're in a geography where
Speaker 1: for the foreseeable future, a we will not be listed
Speaker 1: locally on our local stock exchange and be they will
Speaker 1: not have access to the markets that we are on.
Speaker 1: Most people around the world don't have access to the
Speaker 1: American stock exchange system, and that by itself is the
Speaker 1: biggest one, let alone the German Stock Exchange or the
Speaker 1: French stock exchange. And so we want to have a
Speaker 1: product whether you are in Guatemala or in Germany, and
Speaker 1: we want to continue having that. And there are indexes
Speaker 1: that I can give to you in an ETP format.
Speaker 1: But if you want to make a themed allocation into
Speaker 1: say the metaverse or defy or or anything else, and
Speaker 1: you want this for some reason as a Salona token
Speaker 1: or an Ethereum token, we should have that product should
Speaker 1: have our name on it as well. That's the basic
Speaker 1: summary of why we do tokens and how we think
Speaker 1: about it is greater accessibility. You do get into some
Speaker 1: very interesting things though, with respect to like what kind
Speaker 1: of products you can build in tokens, because it turns
Speaker 1: out that when you start doing this, you'll then see
Speaker 1: there's a lot of things I can do with tokens
Speaker 1: that are impossible to do with the t f s,
Speaker 1: and a couple of the other way around, but mostly
Speaker 1: tokens are better in a lot of technological ways. You
Speaker 1: could build products that incentivized long term holding by air
Speaker 1: draw up in the feedback at first certain period of time,
Speaker 1: help and various things that you know you could not
Speaker 1: do independently. And so there's all of those aspects to it,
Speaker 1: which is how we broadly organize it. Think about it.
Speaker 1: Tiden up your straight jackets. It's time for the craziest
Speaker 1: things we saw in markets this week. Well, the way
Speaker 1: I organized and think about things is in crazy things.
Speaker 1: I don't know that's an awful seguet, but I'm trying here.
Speaker 1: But let's get you. Have you start us off, what's
Speaker 1: the craziest thing you saw in markets this week? Well,
Speaker 1: as you know, my recent favorite topic to talk about,
Speaker 1: which you and I have discussed, is football. So my
Speaker 1: weirdest thing actually is a story about football. The Bloomberg
Speaker 1: headline said, Lucky Better wins dollars with a twenty dollar
Speaker 1: wager on NFL weekend games. So it was somebody who
Speaker 1: bet the Bengals would beat Kansas City twenty four and
Speaker 1: that the Rams would beat San Francisco T to seventeen.
Speaker 1: It was a twenty by getting the scores and the
Speaker 1: winners correct. Wow, that's it's pretty amazing. Nine thousand dollars
Speaker 1: for a bet. Yeah, but they they're killing themselves for
Speaker 1: not putting another twenty in the right. Well you wonder
Speaker 1: maybe maybe that person had a thousand twenty bets on
Speaker 1: all various permutations, but I hope. So I like this
Speaker 1: story because I'm so bad at guessing the outcomes, Like
Speaker 1: I definitely guessed the opposite for both for all for
Speaker 1: basically all of them all season. So this this is
Speaker 1: really striking to me. So no Draft Kings app for you.
Speaker 1: Do not down that, don't download, that would be dangerous.
Speaker 1: But that's pretty good. One bill down. I'll give you.
Speaker 1: I'll give you credit for that, and I will accept
Speaker 1: sports gambling as a crazy market thing. You know, why not?
Speaker 1: Why not? Ino? How about you? How do you you've
Speaker 1: seen anything crazy in the past week or so. I've
Speaker 1: done zero preparation for this, so I'll just say content
Speaker 1: thing that irks me. Coin Base is a bell weather
Speaker 1: for crypto. Coin based is an incredibly undervalued company. No
Speaker 1: one really understands coin based on the public markets. You
Speaker 1: could see this gulf between public and private in how
Speaker 1: ftx has pund raised this week versus the very public
Speaker 1: price coin base. At some point, ft x is a
Speaker 1: wonderful exchange. It's very quickly growing. It is small compared
Speaker 1: to coin base, and if at some point the private
Speaker 1: markets are valuing it higher than things coin based publicly,
Speaker 1: that should say something. People are overreacting in general. Overall,
Speaker 1: we see it with crypto prices. We also see it
Speaker 1: with crypto public equities. And this is a clear case
Speaker 1: of like, read that coin based quarterly reports, see how
Speaker 1: much money they're holding, how much money they're making, what
Speaker 1: they're actually doing, and you know, tell me somehow that
Speaker 1: it's worth thirty six billion dollars or whatever. Though the
Speaker 1: number that's it's pretty uscinating. I wonder if there's you know,
Speaker 1: does that tell you something about sort of the amount
Speaker 1: of private capital looking for a home and and uh,
Speaker 1: you know something about that side of the market that
Speaker 1: is out of balance. Maybe? I think it mostly is
Speaker 1: just a reflection of how short term cited the public
Speaker 1: market is. And I think you you deal with venture
Speaker 1: investors who are comfortable holding for five to ten years position,
Speaker 1: and that's not the case in the public markets. Crypto
Speaker 1: is going to go whatever the price of bitcoin is
Speaker 1: right now, which I am proud to say I do
Speaker 1: not know. Crypto will go below this price. Crypto will
Speaker 1: go above this price, but in a certain time period
Speaker 1: five to ten years, crypto will materially be above wherever
Speaker 1: we're at now in terms of adoption, in terms of price,
Speaker 1: in terms of usibility, in terms of a lot of
Speaker 1: other things. And I just think that bet is harder
Speaker 1: to make in public markets overall than in private markets. Right,
Speaker 1: that makes a lot of sense. All right, I'll give
Speaker 1: you my crazy thing. Um, I'm fascinated with domain names
Speaker 1: in web three domain names m because I'm old enough
Speaker 1: to remember back in the original dot com boom, all
Speaker 1: the domain names squatting that went on, people thought, if
Speaker 1: you bought the right domain name, and in many cases
Speaker 1: they're right, it ended up being worth a fortune. So
Speaker 1: kind of a similar thing going on with crypto domains
Speaker 1: um and the idea if you're not familiar, I think that,
Speaker 1: and honey, correct me if I'm wrong about any of this.
Speaker 1: But to me, the main appeal of having your own
Speaker 1: crypto domain is, you know, you can put your wallet
Speaker 1: at that address, and then it's a lot easier to say,
Speaker 1: you know, send me some crypto to this Mike dot
Speaker 1: ether or whatever. Then here's my you know, super long
Speaker 1: uh wallet address. What is it like forty forty numbers
Speaker 1: and letters or however many it is. But so I
Speaker 1: was looking at the Salona name service yeah, bonfida yeah,
Speaker 1: and a little bit different than the Ethereum one. And
Speaker 1: that they they will allow you to buy a corporate name. Yeah,
Speaker 1: you know, so you can buy Like I was, I'm
Speaker 1: looking at their leaderboard. Number four is Starbucks dot s
Speaker 1: o L. I guess went for about interestingly, which seems
Speaker 1: low right interestingly, right right interestingly. A corporate name is
Speaker 1: not the top of their leaderboard. So I want the
Speaker 1: two of you to hear me out here and try
Speaker 1: to guess what is at the top of it. Bill, Donna,
Speaker 1: if you had read my little contribution to the Crypto
Speaker 1: newsletter this week, you would know this. But I think
Speaker 1: that might if I'm with any luck. That's the one
Speaker 1: thing you haven't read, uh this week. I read it
Speaker 1: three times. Give us a hit. The top priced domain
Speaker 1: name for Salona is an emoji. It's not even a word,
Speaker 1: it's it's an emoji. So so guess the emoji and
Speaker 1: guests guess the prices a tiebreaker, you go first of all, Donna, Well,
Speaker 1: I feel silly because I read your column three times,
Speaker 1: but I was sweeting it for grammatical errors. Would you
Speaker 1: tend to make a lot? Nothing gets full dot and
Speaker 1: we're excited than finding it a type something I've written? Yes, yeah,
Speaker 1: So am I allowed to say poop emoji just for fun?
Speaker 1: It's that allowed on the podcast. I'm going to go
Speaker 1: with that, and I'll go with ten thousand. I guess,
Speaker 1: I don't know, just double the Starbucks alright, hotty Starbucks.
Speaker 1: So boomji was actually one of mine. Because ship coins
Speaker 1: are a thing. I'm amazed. It's not Oh wait, wait,
Speaker 1: never mind, I'm giving them giving away that. I'm giving
Speaker 1: it away, the secret diamond hands. I gotta give it
Speaker 1: the honey. It's it's just the diamond and and sixty
Speaker 1: thou dollars. What a guess. Wow, he's off bite neither one.
Speaker 1: If you is allowed to ever sell me do why
Speaker 1: people will be contacting your people about there should be
Speaker 1: a hand in there, diamond tomoji the hand. Well, apparently
Speaker 1: the single character ones are the most valuable, So yeah,
Speaker 1: diamond hands would probably be up there too, I would mention.
Speaker 1: I think, um, that makes sense. I don't think I
Speaker 1: won that. I said, diamond hands, Yeah, close enough, close enough,
Speaker 1: better better than the disgusting one vildonna. Just at least
Speaker 1: I didn't curse, honey, curse. It was my number one choice,
Speaker 1: number one choice. It's a vertical in our space. It's
Speaker 1: an important to us at class at this point. But
Speaker 1: all right, well we'll see, we'll say maybe that one
Speaker 1: you may or may not have that ticker reserve. I
Speaker 1: think we just broke some news filled out. I think
Speaker 1: we just broke some news. Yeah, I think we did well.
Speaker 1: I'm kidding. But but if I'm not kidding. I will
Speaker 1: do this right now. Fantastics all right, We'll have to
Speaker 1: check back on the leaderboard for the Salata domains. I
Speaker 1: have a feeling maybe someone will. We'll hear this podcast
Speaker 1: and bit up that that discussing emoji that but you
Speaker 1: should you should buy it as a gift. You should
Speaker 1: be doing that. I'll see. I'll talk to our compliance people,
Speaker 1: see if I can get that get that whatever she wants.
Speaker 1: I'll air drop the poop emo g T. I don't
Speaker 1: know that that sounds disgusting, but honey, really fascinating conversation.
Speaker 1: Can't thank you enough for your time. Hopefully we can
Speaker 1: do it again some day. Thank you so much because
Speaker 1: a black Thank you, honey. What goes up? We'll be
Speaker 1: back next week. Until then, you can find us on
Speaker 1: the Bloomberg Terminal website and app or wherever you get
Speaker 1: your podcasts. We'd love it if you took the time
Speaker 1: to rate and review the show on Apple Podcasts so
Speaker 1: more listeners can find us. And you can find us
Speaker 1: on Twitter. Follow me at bring Anonymous. Bildonta Hirich is
Speaker 1: at Bildonta hi Rich. You can also follow Bloomberg Podcasts
Speaker 1: at podcasts, and thank you to Charlie Pell to Bloomberg Radio.
Speaker 1: What Goes Up is produced by Laura Carlson. Ahead of
Speaker 1: Bloomberg podcast is Francesco Levie. Thanks for listening, See you
Speaker 1: next time.