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Senate Passes GENIUS Act! What comes next?
Recorded: June 18, 2025 Duration: 1:23:10Space Recording
Short Summary
The recent passage of the Genius Act introduces a comprehensive regulatory framework for stablecoins, emphasizing reserve transparency and federal oversight, which could significantly impact the crypto landscape by fostering growth and institutional adoption while also raising concerns about algorithmic stablecoins and potential declines in interest.
Full Transcription
Thank you. Oh Thank you. Thank you. Thank you. Thank you. Thank you. Music Thank you. Thank you. Thank you. Thank you. All right, looks like a little bit of a smaller turnout today, but that's fine.
We can talk about the Genius Act with our friend Ryan here and kind of the implications of this passing by the Senate yesterday.
It's pretty huge, right?
So the summary of what the act does for people that aren't too familiar, it creates a federal framework for stablecoins.
So if you don't know what stablecoins are, they're digital assets, or excuse me, they're digital tokens pegged to an asset like the U.S. dollar or gold or the euro.
And there's a one-to-one reserve backing mandate, meaning that the stablecoin issuers must hold equal value in U.S. currency or liquid assets.
And those that have specifically over $50 billion in circulation must provide audited reserves.
So issuer standards, right? So this is – not everyone can just go out there and launch their own stablecoin. There's a lot of different approved entities. Sorry, there's specific approved entities. So bank subsidiaries, federal, qualified. It's not just – you can't just go tomorrow and make your own stablecoin, right? There's going to be strict oversight.
There are going to be AML-KYC rules, public disclosures.
There's a lot – it's a big battle.
Not a big battle, but there's just a lot that needs to be looked at and approved, and I still think it's going to be relatively gatekept.
at and approved, and I still think it's going to be relatively gatekept.
And also, the U.S. markets need to have consumer protections. So again, reserve transparency,
I'm assuming it's going to look something like the proof of reserves that centralized exchanges provide.
And it also prohibits congressional family profits.
So this, although this doesn't extend to the president or the immediate family,
which is a point of criticism, and I think that's going to be something that's highly debated and contested.
I think it's kind of interesting where congressional family profits are prohibited, but it's not extended to the president or his family.
And it's kind of odd to me.
So I'll pause there.
Ryan, what are your thoughts so far?
What are your thoughts on the act specifically?
And then we can dive into why it matters.
Oh, man. Well, first of all, good morning. thoughts on the act specifically and then we can dive into why it matters.
Oh man, well first of all, good morning. Good morning Noah and the rest of the
spaces here. Man, I've been going through this, it's you know 57 pages, so rather succinct for a law here in the US. I mean, we see laws that come out that try to
give general guidance for things and they end up being thousands of pages and it takes people days,
if not weeks to scour through them and find out everything was in there. So I will say that the
benefit of this one is it's only 57 pages. So you can actually
go through it fairly quickly. It's fairly straightforward in what it does. They didn't
overcomplicate it, which is nice. But I will say that they left some key things out that make it
maybe a little confusing for what it means for the defy world um
you know stable coins right now is kind of a safe harbor for people on the dexes that are moving in
and out of crypto and maybe trading meme coins uh trading um wrapped bitcoin or trading the different
alt coins on the dexes uh jumping back into a stablecoin is often
kind of like a safe harbor where you have your cash reserves and you're writing the ups and
downs of the market. And even getting like a return if you want to lend out stablecoin on
one of these DeFi protocols, whether it be like Aave or Compound, there's not a whole lot of guidance or regulatory clarity
on usage in that way. So the way these DEXs will hold the stablecoin, the way there's lending and
all the different financial products on chain right now, we're completely not addressed by
this bill. Really what it looks like for this bill, it's like the initial step of starting to set up
walls around the use of U.S. denominated currencies on chain.
And that's really kind of what this bill was.
It was kind of drawing a line in the sand saying that the U.S. will be monitoring and auditing anything that's
denominated as U.S. currency on chain.
And they want to bless those who are allowed to issue it.
So the key word is issuer, where it would be a designated party entity or a company that was sanctioned by the US. So it'd be a bank
or an approved non-bank. But there's really not a whole lot of clarity around the word
issuer beyond that. I find this really interesting because it leaves kind of this open question mark around a
Dow. There are nameless, you know, Dow's out there where you don't know who the quote unquote
issuer is. So you can have Dow's that could be its own stable coin entity. And it completely falls
into a gray area for this bill because it doesn't fall under
any type of applicant or company or bank. So I found that really, really interesting. But this
does, just to wrap it up and I'll hand it back to you, Noah, it does provide a line in the sand and
start setting up walls around banks and large institutions that want to control
stable coins on chain. So JP Morgan, PayPal, potentially Square and Stripe. I think Walmart
was even applying for a stable coin. There's a lot of really big entities that are applying for
stable coins now, and it's kind of putting a wall around them
and they can all get approved as stable coin issuers which puts them basically in line for
federal oversight monthly audits and one last point is in the bill the feds have, the federal department that's reviewing applications has to respond with a yay or nay on the application within four months.
If they do not respond to the application within four months, then the applicant automatically is approved.
So it's a yes until no type situation, which is really, really interesting for a U.S. law
because typically it's a no until yes.
It's typically guilty until proven innocent.
This is a very rare situation in the finance world in the U.S. where it's a yes until no,
which means that eventually this department could get so overrun with applications that there is no possible way, given the affinity of government efficiency that we all know, to get through all the applicants within four months.
And therefore, we could have a flood of, you know, basically just stable coins that automatically get approved.
So that's right for a potential exploit as well.
Yeah, I was going to say, initially I thought you would tell me that after four months,
if it's not approved, then you need to reapply.
But it sounds like you can just, you know, people can just flood the system with applications.
And like you said, if the workers or if whoever is in charge of approving can't get to all of them, now you just have different companies and different entities launching their own stablecoins.
And I don't know, do you think there's going to be degrees of criminal behavior as a result?
The wrong entities getting approved just automatically?
Well, you have to remember that even if they're automatically approved,
they are still subject to monthly audits.
So they do have to expose their books on a monthly basis,
showing a one-to-one reserve.
And the bill is fairly clear on what type of assets
they can diversify their treasury into.
It is very much geared towards low risk assets,
whether it be just holding US dollar
or holding some type of treasury for yield,
but that's clearly defined.
So even if you do get through this application process and you
you know get just de facto approved you still have to keep your books open to the monthly audit and
if you grow fast enough this is the other thing is there's a 10 billion dollar threshold so if
you're you know if your uh fly by night stablecoin happens to grow massively and gets very successful, 10 billion plus, then the federal regulators and oversight actually step in to control the situation. It's really kind of interesting. But to answer your question, I do see under this bill a situation where we could have tons and tons of stablecoin issuers that get de facto approved just from the flood of applicants.
And like you said, algorithmic stablecoins are like your tweets as I pinned Ryan's tweet to the top.
Algorithmic stablecoins and stablecoins launched by DAOs.
By the way, with respect to the latter, I did not think that DAOs were out there launching their own stablecoins.
On a quick tangent, tell us a bit about how that works.
Tangent. Tell us a bit about how that works.
Yeah, so this is a this kind of interesting loophole in this whole thing, because they say that if you are an issuer of a stable coin, right, then you fall under these regulations.
Yeah.
contract that can accept assets, can accept Ethereum, can accept some type of altcoin,
or can accept other stablecoins. And out of that deposit, you issue a stablecoin yourself,
or that smart contract issues a stablecoin. It's a deterministic entity on chain or a DAO,
a decentralized autonomous organization that handles its own treasury that is fully auditable,
that is fully on chain.
And you can't really track down who's in control of that.
Now, the issuer of that contract then could do withdraws
from the deposits and they could divest the deposits
however they want to get some type of a yield.
And then they could show like a fractional
reserve or whatever but there is still a layer of anonymity there so so there there is still a
gray area for dows and that quote-unquote term issuer and i'll go stable coins are just completely out of the question. This makes me
think that the future, I mean, if it already kind of is like this, but for sure, the future of
stable coins is going to be stable coins that are centrally controlled. And I don't want to call
them pseudo CBDCs, although in some cases they could be. But generally speaking, I think that
we're just going to see a future of centralized CB, excuse me, centralized stable that can be
frozen at any time for any reason. What are your thoughts on that? So, yeah, so the algorithmic
stable coins, to be frank, just not a lot of people understand them, right?
They don't understand the working mechanism behind them.
They don't understand necessarily the stability of their value or the long term viability of the peg.
So the bill calls out kind of a further study, a further research for algorithmic stablecoins.
Now you got me doing it.
But there's just not a lot of clarity there at this point.
So for now, stablecoins have to have a one-to-one back reserve and it has to show basically low risk diversification of the deposits in the stablecoin
treasury. And that basically makes algorithmic stablecoins an outlier, which would not hold up
to the current regulation. So this now goes to the House where negotiators may choose between this version or the already passed House Stable Clarity Act.
I'm not too familiar with that, but I know that reconciliation is required before it reaches the president.
Are you familiar with the Stable Clarity Act, Brian?
the Stable Clarity Act, Brian? I'm not. I haven't dug into that one yet. I spent most of my time
I'm not. I haven't dug into that one yet.
digging through this 57-page document. So yeah, whatever gets through to the president,
what gets kind of the amalgamation of two different bills here that got passed with
House and Senate, which by the way, I see this happen a lot with Congress. And I still sit there scratching my head going, wait a minute, like,
I didn't think that's how the process was supposed to work. But it does seem to be the
very common process now of like, oh, they passed this version and they passed that version.
And now we're going to look.
I have no idea what happened there. Sorry.
You're going to have to unmute a few times to make it work.
Yeah.
Sorry. I got, yeah. When you have like incoming calls, it does seem to block you.
Yeah. I'm not, I'm not super familiar with the House side of the bill. I'd be really
curious to see what comes out of the reconciliation and actually makes it through to Trump.
I agree. So the implications, right, the implications are huge. For consumers,
more protection, clear redemption rights. For crypto firms, you have a structured,
reliable operation framework that is going to encourage or hopefully encourages U.S.-based innovation.
For banks and payment networks, this could enter the stablecoin space under – they could enter the stablecoin space under these regulated conditions.
And then global issuers now have a pathway to operate within the U.S., raising competition and compliance complexity.
So this is overall good, and I think that if you do have different entities like Bank of America and Walmart and PayPal,
and PayPal's already launched one, but basically once you have all these stablecoins launching that are available to the average US person. And then once the average
person, once the average, I foresee a rise in one-click DeFi solutions. So, you know, front
ends that look more or less similar to, let's say, Robinhood, that allow you to stake your stable
coins in, let's say, a trusted DeFi application like Aave. I see a rise in those,
and I'm sure that Aave, for example, is already working on something like that. But once U.S.
citizens have access to this many stable coins, once stable coins become saturated and maybe
there's a de facto way for people to self-custody dollars, I can see a lot of that money flooding into DeFi
because people see now, oh, well, I can earn 6% APY on this stablecoin, and my bank account's
only giving me 3.5% now. What are your thoughts on that? Yeah, so we have to remember that people
really, really don't like it when you mess with their business model.
And the more powerful those people are, the more well entrenched that entity is,
the dirtier they'll play. For some reason, I have a firm belief that the banks in the US have no qualms with playing dirty in order to protect their business model. I think this step with the bill is it's ambiguous enough in certain areas,
but it does start setting up walls that I can,
I can see the bank start taking advantage of fairly quickly.
One thing I was going to say is I originally thought this, you know,
every summer we seem to have a theme in crypto, right?
We had the meme coin summer and we had DeFi summer and we had the NFT summer.
And it's because the general markets, you know, are typically down and sideways.
And there's always something that comes out during this kind of doldrums period in the market.
And I thought for a long time it was going to be like the summer of AI
agents. I thought like, we're just going to have like so many AI agents and all these projects
that are exploding on AI agents, but there's been this shift. And I really think that we're
going to be going into the summer of stable coins where everyone and their mom is going to be
announcing a stable coin or bringing out a stable coin and some type of yield or DeFi or whatever.
And I think that the banks are going to use that
as a talking point, if you will,
and say, look at this crazy wild west
of all these mom and pop stable coins.
Like we need greater clarification.
We need greater regulatory control.
We need to tighten it up more.
I think there's going to be a move towards more and more centralization around the stablecoin issuance and control.
I think this is kind of the first bill of its kind to like start setting up walls.
But I really do think the bigger banks in this country are going to start moving to control the stablecoin
economy here in the U.S. And I think we'll see that over the next six months.
I think the eventual goal is that other countries will follow suit, where they'll start adopting
stablecoins. The U.S., you know, kind of leading the charge there. I, regardless of the doom and gloom or the
conspiracy theory around banks, I do think this is a general positive thing for the individual
because there is greater freedom currently in a stable coin versus fiat. Anytime fiat is in the
banking system, it is very, very controlled. I can't just withdraw
my money whenever I want to. I can't just transfer my money whenever I want to. And if I do, if I try
to go to the bank right now and I try to withdraw a couple thousand dollars, I have a bank teller
asking me why I'm withdrawing the money. Because they are going to enter a note in their computer
and they need to have a reason why I'm trying to access my money.
You don't have that type of intrusion with stable coins currently where you can freely go between countries and as long as you have your passphrase or your mnemonic in your head or memorized,
you take your wealth with you. So I think the narrative around stable coins
is still very powerful, but I do think
that large centralized organizations will seek more
and more to gain greater control over it.
And I think they're gonna use a summer explosion
of stable coin applicants and issuances as a reason why we need greater
auditing and greater control.
Stablecoin summer to I think the average crypto head or just average person doesn't sound
as exciting this DeFi summer and it's not not like the hot girl summer thing, right?
Yeah, stablecoin summer, it's like a bunch of old Wall Street guys in suits, you know?
It doesn't sound very sexy at all.
This idea of being able to take your wealth across borders, I think, has always been,
for me, the most paradigm-shifting component
of crypto.
And for stablecoins, I don't know, it's kind of, for me, just like the idea that the issuer
can technically freeze someone's assets is not, it's not super, it's not relieving to me.
I don't know if I would be able to sleep well at night if I had hundreds of millions of
dollars sitting in a stable coin that I know technically can be frozen at any time.
I'd rather hold like Ethereum or Bitcoin.
Such a great point.
Yeah.
Such a great point. Yeah. Such a great point.
Yeah, that's the other kind of underlying thing
that was clearly laid out in the bill
and kind of the heart of the matter here
is greater control.
And there is this idea that a stable coin,
in order for it to be compliant with the regulations, is the issuer of the stable coin in order for it to be compliant with the regulations is the issuer of the stable coin
has to be able to freeze and control the stable coin, which kind of flies in the face of the
general ethos of DeFi and these crypto networks in general is we want less regulation.
We want sovereignty in our in our currency, in our wealth, in our assets.
And the idea that this regulation declares that a government sanctioned stablecoin must be controllable by the issuer completely removes the aspect of decentralization
completely removes the aspect of sovereignty so yeah there you go it does pave the way for
credit on the blockchain it does pave the way for all the traditional debt instruments that
we currently have in in normal, it does pave the way for
that. But along with that comes the complete destruction of self-governance and sovereignty,
unfortunately. I agree. Mikey, what's going on, brother?
Hey, but excuse me. Sorry about that. No, it's, you know, Ryan brings up a good point. But honestly,
if you look at the 21 cycle where it was honeypots and all sorts of stuff, people were clamoring for,
gosh darn frog, people were clamoring for some kind of regulation. They're like, we need,
we need help. Someone needs to stop these scammers and all that. And this is what you get. And you
know, you get, you know, Wells Fargo and Bank of America launching a token, being able to freeze
the assets, being able to do all that stuff.
Now, people are going to look back and say, maybe we didn't want it, but it's here and it's the future.
So the positive is that more and more people are going to be into Web3, into crypto due to this.
But now you're going to have the regulation that people wanted because they were getting scammed.
But a lot of people didn't want because they want to be able to have their funds, have the anonymity with it, and be able to use them as
they want. I will say a positive on my side is with your traditional bank, it's nine to five
hours, Sundays are eight to one. But with this, three in the morning, Saturdays, Sundays, you're
able to access your money and move it. So there's going to be positives and negatives both ways,
but people wanted regulation. So this is kind of what you get.
Yeah, Mikey, look, I totally agree with you.
And one of the things that really frustrates me about the traditional banking system is, or even platforms like PayPal or Venmo, is how much more restricted and difficult it's become for me to send.
My cousin lives in Canada, for example, and he's young. He's
about 21, 22. He's working at coffee shops trying to make it. And so I send him money here and there
just to help him out. He doesn't know how to use blockchain and crypto. I've tried to tell him how
to set up a wallet and stuff, and he's just kind of doesn't. So me sending him money from PayPal or Venmo, the number of different questions I need to answer and the limits.
And like you said, going to the bank and Orion said, going to the bank and having to answer questions.
I'm trying to get a loan to buy a home, for example.
And I swear, man, in five to 10 years, they're going to want a freaking blood sample for me.
It's the number of questions they ask and i just i think i've been i've been red pilled crypto pilled whatever
you want to call it but but i just compare it to me going on ave where i have my bitcoin and i have
my ethereum staked and just borrowing against that with a couple clicks of a button and it's
just such a it's such a better system i know it has its own downsides
right if you get hacked you're fucked you have to self-sovereignty comes with the responsibility
and all that but um i don't necessarily see the you know the the genius act or the kind of
institutionalization of stable coins or the framework around stable coins as a net negative
i know it's not what you're saying but for me i'm just not going to use the wells fargo stable coin of stablecoins or the framework around stablecoins as a net negative.
I know it's not what you're saying, but for me, I'm just not going to use the Wells Fargo stablecoin, right?
They can launch all the stablecoins they want on Ethereum or on the EVM.
I just see it as more people potentially onboarding as a result.
So yeah, the Bank of America stablecoin is not my safe haven.
And to be quite frank with you, I don't really see any stablecoin as a safe haven unless it's decentralized.
And what do you guys think about a stablecoin like LUSC, that of liquidies,
where they just have a bunch of Ethereum locked and they're issuing a stablecoin that way?
Well, I mean, it's immediately against the law with this bill. It does not qualify for
the custodianship of the reserves.
That's in the US though, right, Ryan?
In the US, yeah. So what we're going to start seeing is we're going to start seeing the approved assets
and we're going to start seeing the illegal assets.
And there's going to be eventually very serious implications for mixing the two, where wallets
that have the approved assets cannot mix or diversify with non-approved assets.
non-approved assets otherwise they become tainted uh you know we we can't forget that the the
Otherwise, they become tainted.
current system that we we all know and live in or within uh was created by the same group of people
or propagated by the same group of people that are currently working on the new the new system, the new legislation to control the new system.
So it's the same people. Once you let bankers and Wall Street and government in the front door,
it might look very benign at first. Everyone's like, oh yeah, we can't operate without regulation.
Bullshit. You can operate without regulation well you can operate without regulation we've operated without regulation for hundreds of years in different
countries around the world thousands of years and and we still survived uh you know what can't
operate without regulation is big business and big companies that want to create a monopoly on
a certain industry and that's what banks have had in the US. I mean, we saw
a couple years ago under Biden, we started seeing the large three banks gobbling up all the smaller
banks, right? And it was looking like we were going to have this oligopoly of banks here in
the US where you have the three big state approved banks. And this whole thing keeps reminding me of,
it was thrown around several years ago
and it has its wave of popularity,
but this quote by Benjamin Franklin,
he said, those who would give up essential liberty
to purchase a little temporary safety
deserve neither liberty nor safety.
And like this idea that we are through regulation, we're looking for safety,
which it does provide safety. It provides safety for the consumer. If any of these stablecoin,
approved stablecoin companies go bankrupt, the holders of the stablecoin are first in line to
get their money back. You know, there is consumer safety there. Like the stablecoin companies can
freeze assets. They can move assets. If you got scammed, it can restore the money back to you.
So there's a chargeback implementation.
But at the same time, with that safety comes less liberty.
And over time, you will find the propagation of safety to take more and more ground of liberty.
And that's kind of the slippery slope we're on now.
This whole idea of tainting wallets is interesting.
And Mikey, you might be on to something when you said, you know, at first glance, we might not look at the stable coins and say, OK, well, I'm just not going to use them.
And they're a good onboarding tool, but I'm going to opt out.
And maybe that's the first step, right? The second step could be that any wallet that is using another stablecoin
or anything other than those stablecoins is now considered tainted. I don't know what that means.
I also don't, you know, I hope, Ryan, that this isn't a slippery slope. And next thing you know,
you have to start KYC-ing your wallet with certain entities.
And then that wallet is going to be blacklisted from, let's say, purchasing a home.
I don't know.
I've got a lot of thoughts going through my head right now.
I know, for example, in places like the UAE, you can currently buy a property with crypto.
I don't know what the nuances are.
And I don't know what questions they ask you or what hurdles you have to leap over.
But I know that I know people personally that have done it. And if that happens in the U.S. one day, for example, then I wonder if you probably I mean, I guess you probably have to KYC
the wallet that you're buying with. And then they'll be like, well, why why were you you know,
why were you holding LUSD at this point? Or why did you get a Monero transfer, right?
Why did someone send you Monero that was swapped for Ethereum on fixed float?
I'm starting to think of all the scenarios where, like you said, they come in and even though Ethereum is decentralized,
come in and even though Ethereum is decentralized, they come in and they start to make it harder for
people that have crypto on their wallets to integrate with the traditional system. Or,
or everyone goes on chain and it becomes something that, like, can you, can you technically regulate
the blockchain the way that you do the traditional finance system if everyone's on chain and people are just transacting peer to peer?
It seems like it's a different animal entirely.
It is a different animal.
And here's a funny thought along those lines, because the idea of mixing funds is very very serious in the current
system it's very very serious about keeping funds siloed when they're
designated for certain purposes and give you an example of this when we were
looking to open up so I used to be the CEO of a company called Titan and we
would run private mining pools for large miners. When we were looking to open up
an account with a very, very large crypto trading company to do some OTC transactions and just have
general banking with them, they had to do an audit of all our different addresses for the pool.
And when they did an audit for the pool, they came up with a bunch
of addresses that were on their quote unquote blacklist. Basically, these are flagged addresses
that have been correlated to different illicit activity or different companies around the world
that have been flagged by the US. And it actually caused a huge holdup in our application where we had to
come up with reasons why we had transactions with those certain addresses. And we had to
go back through our entire payments log from the pool and find out who those addresses belong to.
And in an anonymous public pool, that's very, very difficult to do. We had to track down IP addresses and all that.
Now, the crazy thing is, because it's an open ledger, right, and the mixing of funds can be a very, very serious thing, you have all these publicly traded crypto ETFs, right? You have all these companies that have billions of dollars in their ETFs and they're custodianed with Coinbase or one of the other big financial
players, they cannot commingle funds or they cannot mix funds from these certain band addresses.
Now, if these band addresses really wanted to really F with the system, they could start
spamming small Bitcoin transactions to all the big whale addresses out there and start
commingling funds against their will on chain. And as long as those transactions got picked up in a
block, any time these ETFs got audited, any time these large treasuries got audited, they would
start having flagged addresses on their books. Something inside of me, like the little anarchist
inside of me, kind of like chuckles because I'm like, oh, that would really like mess up the auditing
system when they all of a sudden start having all these flagged addresses with commingled funds.
And it kind of underscores this idea that you can't necessarily apply the rules of the
traditional system to this new decentralized ecosystem. Oh, it's going to happen, right? It's the same way that
Tornado Cash was dusting different celebrity and high profile wallets. I guarantee you that would
happen without a doubt. I think it would even, I think, I almost think it would be a community
effort. I think just like crypto anarchists and crypto purists, fundamentalists would say,
fuck this. And there would be loads and loads of dusting of different high-profile wallets.
Mikey, what are your thoughts?
You know, the way I look at it, you know, the beauty of the blockchain is that everything's transparent.
Everything's on there.
You can see everything.
You can see what wallets are interacting where.
But at the same time, you know, the door for control has just been swung open.
When you have to KYC a wallet, when you have to KYC one of your wallets, any wallet that you interacted with, it's all going to show up there.
So like you're talking about the asterisks and stuff like that.
None of us are going to make it to that Crypto Hall of Fame under these rules, man.
It's scary to think of.
But, you know, when Ryan said when Ryan said, if you give up your
liberty for safety, that's essentially what we're doing. And we are giving that up, knowingly or not,
when these rules get passed, when these laws get passed, we are saying, hey, we're going to abide,
we're going to do it. And unfortunately, that's how it goes. When something gets big, the people
that were big before that thing got big, they want a piece of it. They want to control it.
And they want to figure out how to make money off it.
And that's where we're at with Web3.
People want to figure out how to get their claws in it and kind of control it.
Yeah, look, to be fair, I feel like a lot of us, like you said, Mikey, didn't want regulation, right?
It's like, okay, we're in a wild west.
And if we make mistakes and we
lose money, we accept the responsibility. I've made mistakes. I've gotten money stolen from me.
I've gotten rugged. And I accept that responsibility, right? I didn't play those
situations well. And I would prefer to continue operating like that, right? I like the self-regulation idea, and I know that a lot
of people don't. And I also like the taking responsibility for myself that comes with it.
However, I don't think it's up to us, right? You're saying that we're, I know you don't mean
it literally, but despite whether we want it or not, it was going to happen anyway.
These people have the power.
I agree.
Yeah, and they're going to come and take over, and that's what they're doing.
And so hopefully we – I think people in crypto, especially people that have been around for a long time, are good at adapting.
Especially if you survive multiple bear markets, you're good at adapting, and we'll've survived multiple bear markets, you're good
at adapting and will adapt to this. Lucas, what's going on, brother?
Noah, good to hear you. Ryan, thank you. Thank you for your summation of the act. I've been
distracted of late and it caught me by surprise yesterday sort of popped up on my radar.
And I listened to most of what you had to say. I had a brief phone call.
Question for you. Was Bitcoin was Bitcoin discussed as as as a reserve asset or something that qualified as a reserve?
And is it? No, it's not. Bitcoin under the current
regulation does not qualify. And if you look at the way the reserve assets and the language
is laid out, it's very much geared towards the traditional banking system and very much geared towards like traditional market tools so treasuries or basically low risk yield bearing items bitcoin and other crypto do
not qualify they would be considered too risky or highly volatile and what about etfs that are based on Bitcoins or other cryptos, are they permissible?
So ETFs are kind of a completely different animal to stablecoins when it comes to regulation.
ETFs still do fall under the SEC.
This bill is very specific to provide regulation where stablecoins do not fall under the SEC.
regulation where stable coins do not fall under the sec um the interesting thing about etfs i
heard something uh on scott's interview earlier where they're talking about um tokenization of
securities and the discussion came up of taking a bitcoin etf and tokenizing it and i was sitting
there scratching my head going well wait a wait a minute, we took a token,
we wrapped it in ETF.
Now we're taking an ETF and wrapping it in a token.
And then all the wrapped Bitcoin guys are sitting there scratching their heads going,
well, we already did that.
But this is like a traditional markets move where we're just going to have wrapped products
on top of wrapped products.
But short answer is each each I should
once again not qualify stable backer well it would do when you say Scott do
you mean Scott Besson Scott Scott I always slaughter his last name wolf of
all streets Scott Metnick Oh Scott I think I'm not milker milker there it is Wait, Scott. I thought it was Melker.
Melker, there it is.
Sorry, Scott.
I always slaughter it.
I don't.
You made it harder. I make it harder.
Yeah, yeah, Scott Melker.
There it is.
That's one of the three wise men.
Melkier, Gaspar, and I forgot the third.
Well, it'd make more sense if there were more than just Bitcoins in the ETF to retokenize them.
But one last question for you, and thanks for the responses.
What about – I see state and federal authorizations for these stablecoins.
I'm assuming this aligns somewhat with the state and federal banking charters.
Was there discussion and does the bill address state stable coins and probably
that are backed by their strategic asset reserves? Yeah, so this is still unclear. So
the bill does outline that this is going to be a joint effort between federal and state oversight.
This does not bar individual states from creating their own regulation around stable coins or how they're going to work with stable coins.
So that's still a really big question mark.
I would venture to guess certain states are going to take a very, very strong stance against it, like California or New York, or a very strong regulatory stance.
And then other states are going to opt for more freedom and liberty.
Historically, that would be like Texas and Wyoming.
But still a big question mark on the regulatory side for states.
You know, I said that was my last question, but that was a joke.
I can't help it out for another.
Because as I think about this, one, when you talk about the different states and their regulatory attitudes,
I think about all of the cases that the SDNY has with regards to crypto, tornado cash, samurai wallets.
There's a couple more that I can't think of that don't come to my mind right now. But part of their
predication for their jurisdiction is because the dollar runs through New York City, runs through there. Are some of these states talking about isolating or giving companies or operators some sort of autonomy
from being pulled into other jurisdictions or other regulatory environments like New York City?
Are we going to get away from the rule of Wall Street in some way?
Oh, I don't know. I don't have an answer for that one. I could foresee the Federal Reserve
stepping in at some point with a central issuance for a stablecoin and saying like the
need for standardization. Until then, I really don't know what this is going to entail on a
state level. I bet Massachusetts won't be for it. That's all I got. Thank you. Thank you. Thank you, Noah, for letting me up and asking my questions.
Of course, man.
You always got good questions.
Yeah, I mean, that's really what I wanted to discuss today was just the Genius Act and the implications. And I mean, I think it's a net positive, right? If we just consider the idea
that regulation is coming and there's nothing to stop it. What do you guys think about this
specifically, right? People of Congress, congressional family profits are prohibited,
but the ban doesn't extend, I can't say it without laughing, the ban doesn't extend to the president or immediate family. What do you guys think about that?
I, I, yeah, I'll let someone else start.
I'll hop in there because obviously we just saw the Genius Act pass the Senate yesterday,
but let's not forget some of the hurdles it had to overcome, which on the one hand,
I'm overwhelmingly happy that we have a crypto focused, uh, or empowering, you know,
or thought to be empowering, uh, administration and office and the hurdles that we've cleared,
the new regulation,
you know, changed, but also just the path forward seems a lot clearer.
While at the same time, I was talking with somebody about this yesterday.
It's been interesting.
It's also been met with some interesting challenges because the Trump family is so actively involved
in crypto, right?
Like the launch of USD1, I get it. But
at the same time, that opened the doorway for people like Elizabeth Warren and some of the
staunch haters of Trump to question, you know, if we pass this, then connect all these dots,
then that means this is just supporting Trump's business. So on the one hand, I think it's great that the Trump family is so
involved and I can't blame anybody. Let's be honest. I can't blame anybody for spending more
than three hours looking at the market and then realizing this is where we want to put all our
eggs in terms of business and development and integration. So I get that that but i do think it's also met with uh a heavier form of
another hurdle to get over of uh from people that haven't made that leap of looking into these
things you know namely uh some people not all but some people that are heavily on the left in
congress to say oh this is only all these things are only to benefit the Trump family. So at the end of the day, I think the pros and cons of the crypto ecosystem
and just the efficiency of blockchain,
as we see getting passed in the Genius Act yesterday,
I think will eclipse some of those issues.
But I do think, you know,
was the Trump meme coin a good thing or a bad thing?
Was, is the USD1 a good thing or a bad thing?
I think it just brings a little bit
more scrutiny, somewhat, I don't want to say slower pace, but slowing down some of the pace
that could be happening if they weren't involved. But I can't blame them for being involved because
this is the foundation of the next stage of this evolution of global finance. So I don't really
know how I feel about it. Yeah, I don't know. I don't know, Amanda. The meme coin was, ah, go ahead, Ryan. I'll
circle back. I want to hear from the panel.
You know, I have, I have no doubt in the next five years that the Trump family will be one
of the wealthiest families on the face of the planet. If you just look at the activity that they've been doing since Trump took office,
and whether it's a good thing or a bad thing, that's beside the point.
They have Trump Mobile, right?
They're launching their own phone service.
They have the
the american bitcoin right the mine the mining play they have the the meme coin they have uh
you know a stable coin they they will take advantage of every single part of this regulatory landscape
um and i i have no doubt that using their own personal branding and their own
family name, that they will become one of the wealthiest families on earth. I can't
really throw judgment out one way or the other because they're very, very smart. They're
a very, very ambitious family and they've done incredibly well for themselves. Anyone that's read the art of the deal or how Trump has made his money, he's done very well
to hedge his bets in every single market. And with his different real estate plays and development
plays, he's just a very, very shrewd guy. So on a national level, he's negotiating for America and our
tariffs and our trade deals. And he is doing everything he can or within his power to
make America, quote unquote, great again. But at the same time, you see his sons and his family starting company after company in each of these regulatory areas.
And I think they're going to just be incredibly successful. And I think the left loves to vilify
that type of ambition and success and the right likes to champion it. So I just, I see it just
being more and more political talking points, even though in a lot of regards, I think it's just amoral.
Lucas?
So I'm really glad to hear that the members of Congress are, I think it's a step in the right direction to excuse them or preclude them from involvement in the creation of stablecoins.
We ought to think about doing so with investment in the stock market too.
Maybe that comes on the heel of this.
But I also think it's very wise to not extend that penumbra to the president.
to the president. And we have already seen, we've already, you know, seen this bear out
in Trump's first administration, the allegations of fraud, of, you know, using his position,
et cetera, et cetera. But we have to be very, we have to understand the very political nature of that position and the
protections that are given it. And so when I think about, because I would imagine that
he's still subject to impeachment and that political process in Congress.
And so I understand that this can be abused and maybe it will do so.
But I also have to think about how this could deflate um how this can deflate wealth and and bear with me here like
trump trump gets out of office let's let's think about how this works you say he will be the
richest family in the world um their wealth in the state of new york is in is is in jeopardy
and in question and and this is part of why i think about you know what autonomy
our state currency is going to have in the future and is somebody like donald trump who has a great
amount of wealth that he garnered in the state of new york but he's persona non grata there
um is he going to try to squirrel that away into a coin or some sort of currency that the state of New York cannot freeze or dissolve.
And I think about how our government also, I mean, we talk about the inflation
of the dollar today. We have this issue going on in Iran. How many people understand that in 1953,
the CIA had printing plates for US dollars and they were housed in Iran. Why did the CIA stay in the
embassy so long after people have been excused? Well, one of the reasons of many was to protect
those plates. And it was with those plates that they were printing US dollars to put in suitcases
to hand out to political figures. And they had several set of plates in Europe. So I think that this notion of using better accounting and open accounting
methods to ascertain what's backing currencies that are passed around are going to force into
open business operators who are actually making something and have an asset behind it that people agree
has some sort of value.
Well put, Lucas.
I didn't think of it that way at all.
I wonder if the Trump family is going to somehow get U.S. people's wrecked on crypto eventually because
they're going to be shilling it so much and things are going to be doing so well.
What do you guys think about that?
Well, I think the Genius Act kind of changes that conversation a little bit because I think
the industry will now get, I don't want to say substantiated, but sort of bolstered by the support of the banking conglomerates as they get more entrenched into the crypto ecosystem with the tokenization of assets, with the tokenization of tre tight line, a tighter edge of how things can be discussed.
As we see, it's kind of, I think, dependent on how these integrations actually roll out and get implemented over the next three years to where we're at then.
If there's not a lot of integrations, I think there's a huge target on crypto's back, almost in retribution to kind of clamp down on all of Trump's things if the left
gets in office. On the other hand, if we see the bank, you know, the big banks making a lot of
money from eliminating a lot of costs from the legacy finance now integrating over onto Stablecoin
and blockchain rails, then it's only going to see a larger impact of more people being involved. So you can't really target crypto as broadly as you have been in the past.
So, yeah, I mean, I don't know.
It's an interesting question or if it's a more selected target that we'll see if that happens.
But I don't know.
I just say it feels like the world's getting more and more integrated on the blockchain.
It's harder to target the ecosystem.
I agree. It also seems like Bitcoin, this is kind of indirect, but just seeing Bitcoin's resilience
over the last couple of weeks, and especially over the last week with the geopolitical and
the war happening in the Middle East is remarkable to me. The fact that all of this news hasn't
made Bitcoin dip under 100K, I don't want to say this because every time,
every bull market we say this, Bitcoin ends up surprising us. but i feel like we've actually entered a new paradigm
this go around but uh we uh we gotta we have to also remember we want to and i don't want to pour
water on that because i agree but at the same time the s p 500 is also holding up remarkably well
uh in all of this so it feels like there's a sense in the investing sector of the market, like there's hope about what could be ushered in from, you know, has been discussed around all the tariffs and potential trade deal comings.
And, oh, we don't want money printing, but everybody that invests, you kind of secretly, I don't want to say you hope for money printing.
You're also kind of like, OK, I'm loving this, you know, the global M2 going up. So I'm here to capture it. But morally, I think it's disgusting, right? I think it's
disgusting that we have all this money printing, but I know it's an inevitability. And I think the
investor class is looking at that, expecting at some point, I would say probably in the next three
months for something major to happen. Otherwise, the market's going to see a pretty big bottom
wash out of it. And we're going to see a pretty big bottom wash out of it,
and we're going to see a pretty big drawdown.
Yeah, I think it's a really good point you just made, Kelly.
Maybe people are catching on, or maybe people have caught on, excuse me,
and they've seen, for example, what happened after the COVID crash.
I know a lot of people got shaken out, and then we saw all-time highs.
And so I think investors are smarter this time around.
I think information is more available. And I think a lot of people are just holding onto
their bags thinking, okay, well, this is just going to be a sideways chop. And even if we dip
lower, I don't want to be unexposed. I just want to wait out the storm and the money printing's
coming and I want to be on the other side of it. So what do you think? I'm sorry, go ahead.
This is not investment advice, so take it as you will. But I will say that my general observation
of the Bitcoin price and the crypto network's values typically go when everyone
is talking about it and everyone is projecting prices of 200, 300, 400K. In my mind, that's the
indicator to sell. When everyone is talking doom and gloom and wash out and the miners going bankrupt
and everyone is, is talking about, you know, how it's crashing and it's destruction and
doom and gloom, and everyone's kind of in the dumps about it.
That's the time to buy.
Uh, once again, not, not investment advice, just an observation. I asked my buddy, Steve, when we were in Vegas, he has a lot of experience launching different crypto ETFs and in traditional markets.
And we were going around the table and I asked him, I'm like, hey, what do you think the top for this year is going to be?
Like, what's going to be the all time high?
What's the high going to be?
And his response kind of sobered the entire table. And he said last Thursday when it hit 111. So, you know, I,
I still think we were going to have a run in, in the fall, but I just, I don't believe, you know,
this, this idea that the Bitcoin cycle is over. It's because that's exactly what they said last cycle and the cycle before that.
And if you look at the corrections, it's been an 80% correction each time.
And if you do the math, 80% takes us back down to what?
27, 28.
No one wants to think about that because that's devastating.
But if we maybe surge in the up to like 160, 150,
and then we do an 80% correction,
I'm just saying a pattern is a pattern for a reason.
It's a good point, Ryan.
Like Ryan said, not financial advice,
but just historically I've seen the same pattern, right?
When everyone is saying higher and everyone's excited and people are leveraging their homes. That's a big one. That's a top indicator and not financial advice. But I've seen that top when people are leveraging their homes and selling shit that they need to buy more Bitcoin. It's usually not a bad time to think about maybe DCing out. I don't know. NFA.
But I also think that this time it feels a little different.
I hate saying that.
I hate saying it's different because I've heard it's different so many times and it ends up not being different.
It does feel a little different.
However, I am in the same camp where, you know,
if things get very frothy with alts, I'll probably start to pull out this time. I'm
not going to try to time the top. Ryan, how are you doing, sir? I'm doing pretty good. I used to
be IP nerd, just so there's no confusion, but I'm using my real identity now that I got to some
certain metrics on my own deal. So a lot of people are seeing the same patterns, and it's almost like we have a mindshare on what this pattern is and what most of us think it's
going to be in the future, again, not financial advice. So what I want to do is I want to get
actually to the bare bones, the blocking and tackling, like why Bitcoin behaves the way it
does. And if you look at Bitcoin in like the most simplest terms, really what it is, it's the
largest decentralized liquidity pool not charted by a bank in the history of mankind. So right now,
a saying I like is the product is the market cap. So right now, the market cap of Bitcoin is about
$2 trillion. Now, the reason why that's important is not to get religious,
but just the kind of spirituality and religion are part of society. Another way to view it is
it's the largest collection plate in the world because anybody can access it for any reason.
And it doesn't care about your rate, your age, your race, or your sex. How do you get in Bitcoin?
I'm in. How do you get out? I'm out. Now, we talk about it feeling different. I think some of the
reasons why we might have more resistance and might not have a full 80% retracement,
we have a lot of institutional companies that are getting involved, and we're getting more and more Bitcoin reserve companies.
So that's important because the lower it goes, the more they're going to buy because they're
using it as a reserve. And two last points here. One, China has about 200,000 in Bitcoin.
The United States also has 200,000 in Bitcoin. The reason why I think that's important is if we look at history, the Cold War, the more nukes Russia built, the more nukes the United States built.
And eventually the United States broke them.
I think it's a situation where the United States and China, neither one of these countries wants to get too far behind the other country in Bitcoin reserves.
behind the other country in Bitcoin reserves.
And the more these two countries own and hold Bitcoin, the more stable it's going to behave
so we might not have massive retracements.
That's an interesting thesis, and that's one caveat that I share with people when they
One caveat that I share with people when they ask me if this time is going to be the same.
ask me if this time is going to be the same.
Like you said, Lucas, a lot of these reserves, unless we're looking at some cataclysmic event, aren't going to be touched.
So I don't know if we get that 80% retracement.
Although I'm not going to say that a 50% retracement if shit hits the fan is off the table, especially if, as Ryan said,
we end up pumping by the end of the year
to something like 160, 170, or even 200.
I mean, 200 is, you know, I could see definitely,
not definitely, I don't want to say definitely,
but I could see more than a 50% retracement.
You know, when companies are leveraging
and they're adding Bitcoin to their balance sheet
and their stock price is going up as a result, I'm no expert.
It's just something about it doesn't sit right with me.
It doesn't seem sustainable, for lack of a better term.
Lucas, what's going on?
You know, Ryan, you mentioned GlobalM2 recently.
And when I think about Bitcoin, I used to think about it with regards,
well, for a long time, I've had lots of thoughts about it, but with regards to what, you know,
like a good measuring stick for what is Global M2 and getting you out of the obfuscation of being
inside anything that was a part of that measurement because of its static supply.
And now I just think that as long as it holds that static supply,
it's probably going to do good.
But if that ever comes into question, if the miners or there's takeover,
if it changed that, then there could be trouble.
But Noah, I wanted to go back to your, or I couldn't,
I've been dwelling, I've been dwelling on your question about does Trump's success with stable coins hold? And to that, I think it's a great question. There are two, and I've like broadly
two baskets. One, I think the stable coins is an innovation that allows us to peer into a bank's vault. And that's something that was very
hard for everybody to do before innovative technology. Now, so if we begin to think,
oh, we're opening up who can enter into the realm of banking, I go back to the baskets of
I go back to the baskets of Rockefeller and JP Morgan, or dare I say, the Rothschilds.
And Rockefeller was successful because he had a stratospheric business.
He was into oil and all sorts of manufacturing.
So I think that's going to be something that we see
in successful stablecoins. We think of them maybe now or they're being looked at in terms of
entering into the sector of banking, but we should be thinking about it also as to
businesses being able to skip or to become their own bank. Now businesses get to be the bank.
The other basket though was, I go to the Rothschilds, you know, there's a whole lot of
conspiracy about them. But the reason for their banking success was because Papa Rothschild had
five sons and he put them in different countries in Europe. And we have lived in a very long time
in a unilateral banking system, and that unilateralist was denominated in the dollar,
and arguably in gold before, but that gets problematic. But so if we again begin to think about, you know,
sovereignty of currencies and them beginning to de-peg from each other or to operate and fluctuate
without having their own denominator, then you have like the notion of the cult of personality and Trump being trusted in various countries,
various states, various businesses around the world. And if he is able to maintain and hold
that amount of trust between disparate parties around the world, I think that
he will be a byword for generations to come.
But again, I look at political problems going on in the world now
and say that success depends on his political decisions in the next three years.
I couldn't agree more with that, Lucas.
I think it supersedes it
but generally speaking
I agree with most of what you said
Ryan, I want to pass it to you
and then go to Ryan
and then I gotta wrap things up, guys
I think it was a good space
I think it was a good solid
Yeah, I wanted to break up my share
into two different parts
just to make it easier for people to comprehend.
So this is something I saw on Reddit.
So I've been doing due diligence on it.
And obviously, quality of source is quality of source.
Apparently, most of Trump's net worth is tied to crypto.
And he's an acting president of the largest economy in the world.
Now, and a couple other points I think are important for people to know.
These are just like Bitcoin mining 101. Right now, it's about $35,000 to mine a coin. So that creates pressure to sell it at these high prices.
the price is high, more miners are trying to get the coins. So therefore, the price goes up.
And when the price goes down, less miners are trying to get the coins. So that $35,000 number
is probably close to an all-time high because Bitcoin's at an all-time high. But it's important
to know those numbers for things like reserves and how it acts so you can make your own decision
and your own thesis on when you think it's going to be.
And then last point here, I wanted to talk about the stablecoin. Other than maybe boxing out startups, I like that it gives clarity to the space. I think what it does is it opens up not
just for Bitcoin, but for any crypto related product to be priced in terms that make sense
to people for their particular, in the United States at
least, it's priced in dollars. So blockchain's not good at everything, but the two things that
it's really good at is timestamping and digital receipts. So if you have some kind of product
where timestamping is important, obviously intellectual property falls into that line.
And then digital receipts, if proof of purchase
makes whatever you bought, like an expensive purse or shoes more valuable,
or for accounting purposes, you could start doing smart accounting where basically
the transactions go into their own category boxes because you can use smart contracts and stuff.
I think stablecoin clarity opens up all
kinds of innovation for products that actually make sense to the average American, which will
make blockchain make sense. Because right now it sounds a little bit Ponzi scheming to the average
person. Like what's the only value? The price goes up, the price goes down. Well, that's the
only value of a Ponzi scheme. But when they start going, oh, this product that I use benefits me
and I own zero crypto, at that point, the scam narratives will go down and I'm complete.
Also, great points, IP. Man, I'm going to have to get used to the new PFP.
You can call me both, bro. Don't even worry about it. I'm trying to actually get the names
flip-flop where people can't tell the difference. I call it pre-branding it was a little little thing i was doing sure
you're yeah the the the path of legitimacy that you outlined i i see i see coming to fruition i
don't know in in two years and five years and ten years but in my opinion in my opinion and i think
we can all agree it's inevitable i want to give to give the last words to Ryan over here, and then we can wrap.
Yeah, thanks, Noah.
Really enjoyed the spaces.
Really a lot of great questions, a lot of great comments and points made.
Really enjoyed the discussion.
Last thing I want to just challenge people to go look into is do some research over the next day of how George Soros made all his money.
Right. Or he is known for them as like the man who broke the Bank of England, basically attacking the peg of the British pound.
of the British pound.
Just do some research on how he did that.
Because as we start looking at these stable coins
and like USDC and USDT
and how important it is for them
to have real-time price data
and real-time pegging to the dollar
based on their assets,
if there is ever a hiccup in banking,
whether it be network delays or if there's just without getting too much into detail, it's an interesting thought experiment.
But once again, we have globally pegged assets that can be digitally attacked.
So not saying it'll happen, but there is a path there,
and it's an interesting thing to research.
Another conversation for another space.
I think it's a good topic to dive into.
In the meantime, go check out George Soros.
And I've heard the name thrown around a lot,
and I've heard about the way that he made his big money,
but only in passing.
So something I will dissect, and we'll have to reconvene.
If not next week, then another time.
Thank you, everyone, for joining.
Remember that everything you hear on these broadcasts is meant for educational purposes only.
Nothing is financial advice.
So be safe out there, and we will see you all on the next one soon.
Take care.
