0:04

Welcome back to The Breakdown with

0:07

me and LW. It's a daily podcast

0:09

on macro, Bitcoin, and the big picture

0:11

power shifts remaking our world. What's going

0:14

on guys? It is Friday April 11th

0:16

and that means it's time for the

0:18

Friday 5. Before we get into that,

0:20

however, if you are enjoying the breakdown,

0:22

please go subscribe to it. Give it

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a rating, give it a review, or

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if you want to dive deeper into

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the conversation, come join us on the

0:31

Breakers Discord. You can finally get the

0:33

show notes or go to bit.li slash

0:35

breakdown pod. All right friends, we are

0:37

back with another Friday 5 with Scott

0:39

Melker. Of course we are talking about

0:41

tariffs and boy people are getting testy

0:44

and sensitive about this. We're living in

0:46

a Rorshak world which is completely to

0:48

be expected where basically you have two

0:50

types of people. People who can separate

0:52

their feelings about any given political actor

0:55

to just try to understand and assess

0:57

the situation based on the facts that

0:59

we're seeing and operate on that basis.

1:02

The other set of folks cannot separate

1:04

their interpretation of events from their

1:06

affiliation vis-a-vis political actors. And I

1:08

mean that on both sides. The

1:10

people who think Trump is God's

1:12

gift and the people who think

1:14

he's an orange demon are in

1:16

this way united because they cannot

1:18

truly separate their feelings. Now ultimately,

1:20

we're all adults who get to decide how

1:22

we're going to operate. My MO and what I

1:24

try to bring to this show every day

1:26

is a dispassionate analysis that doesn't get caught

1:28

up in my priors. It's why you hear

1:30

so many different sides of any given story.

1:32

It's why there isn't just one set of

1:34

people who tweet who I agree with who

1:36

I share their opinions. And hopefully if you're

1:38

rocking with me on this right at this

1:40

point, you're in for that perspective. But as

1:42

you'll see, it gets a little testy in

1:44

the middle of this episode because of some

1:46

people not wanting to somehow talk about the

1:48

most significant economic story that we've experienced in a

1:50

very long time. In any case... For those of you

1:52

who are here, I of course appreciate your contributions to

1:55

this discourse. And it will surprise you none to find

1:57

out that I think that my audience of listeners who

1:59

I do see... trying to actually get to

2:01

the root of issues, and who

2:03

have the mental flexibility to update

2:05

their perspectives without abandoning their core

2:07

principles or ideas, is a better

2:09

way to live. So with that

2:11

information, let's start into the actual

2:14

episode. Tariff Halooza. Yeah, we have

2:16

a shocking lack of new stories

2:18

to talk about, because there's only

2:20

one thing that's dominating everything right

2:22

now. It's unbelievable. Right now, markets

2:24

are completely unhingged. I was just

2:26

kind of taking a look at

2:28

even on the year from the

2:30

high solos, but we have this

2:32

crazy situation where risk is down,

2:34

right? Stocks are down, assets down,

2:36

SIB is down, Bitcoin is down,

2:38

from the highs earlier in the

2:40

year, but also the dollar is

2:42

down. I'm old enough to remember

2:44

when risk assets were supposed to

2:46

have an inverse correlation to the

2:48

dollar. And of course, yields keep

2:50

going up no matter how hard

2:52

they try and gold is surpassing

2:54

$3200. including the things that usually

2:56

go up when everything else goes

2:58

down. Yeah, and obviously it's all

3:00

a result of this, right? Generally,

3:02

tariffs, but the bigger story here

3:04

is the indecision around tariffs, the

3:06

50-50 split views on what each

3:08

of Trump's moves means, like half

3:11

the country and world seeming to

3:13

think that he capitulated, half seeming

3:15

to think that he's playing 12D

3:17

chess and executing the art of

3:19

the deal. Either way, I can

3:21

tell you that both Powell and

3:23

China, who are probably his biggest

3:25

opponents at the moment, have called,

3:27

whether it's a bluff or not,

3:29

they've called China, once again here,

3:31

raising their tariffs up to 125%

3:33

and calling Trump's levies a joke,

3:35

officially coming out of China, and

3:37

of course, Powell pushing back and

3:39

saying, well, we're less likely to

3:41

cut now because we're afraid inflation

3:43

is going to go up. Yeah,

3:45

I mean... You know, I think

3:47

the interesting sort of story of

3:49

this week if you look at

3:51

the pattern was, you know, we

3:53

can't. into Monday everyone's asking is

3:55

it going to be you know

3:57

a black Monday redox? Kramer's screaming

3:59

for it. So of course it

4:01

doesn't happen. You know but things

4:03

still aren't looking good. bonds start

4:05

freaking out. I mean this is

4:07

all the stuff I'm sure you've

4:10

covered over your show every day

4:12

but you know for the quick

4:14

hit recap bonds are freaking out

4:16

overnight and and that I think

4:18

seems to catch attention given that

4:20

while we've turned away from the

4:22

stock market as the as the

4:24

indicator of what's successful the treasury

4:26

yields are still kind of firmly

4:28

in the the driver's seat at

4:30

least in terms of the narrative.

4:32

So we get the 90-day reprieve

4:34

and the 90-day reprieve isn't exactly

4:36

or reprieve. that maybe this won't

4:38

be as bad as we thought.

4:40

But then, 24 hours later, I

4:42

think a combination of two things

4:44

happens. One, people remember that they

4:46

have no god damn idea what's

4:48

for dinner, you know, to say

4:50

nothing of whether things are actually

4:52

going to be the same in

4:54

90 days. And then at the

4:56

same time, they also kind of

4:58

recognize that. maybe all of it's

5:00

a distraction for what the real

5:02

thing is, which is this trade

5:04

war with China, and that clearly

5:06

is still on, you know, like,

5:09

Donkey Kong. And the rest of

5:11

the week has been basically digesting

5:13

the, you know, tit for tat

5:15

escalation of that very specific piece

5:17

of the story, which is China

5:19

versus the US. And so we

5:21

end the week with China, to

5:23

your point, calling. And I think

5:25

people even who are very supportive

5:27

of these policies, being pretty nervous

5:29

about a slap fight with a

5:31

country that doesn't seem to have

5:33

nerve ending. So, you know, here

5:35

we are. I mean, I've said

5:37

this over and over again. China

5:39

has shown no. lack of ability

5:41

to torture their citizens for political

5:43

gain or just to prove that

5:45

they're right. I mean, obviously during

5:47

COVID, they were locked down for

5:49

years past when everyone else does.

5:51

So it's very clear that this

5:53

is a very high stakes game

5:55

of chicken with an opponent that's

5:57

very very unlikely to flinch. I

5:59

mean, you dig through these articles

6:01

and it takes a while, right?

6:03

Trump and Zier preparing for a

6:06

war nobody wants. I think everybody

6:08

agrees with that. Trump terrorist, but

6:10

US services, trade surplus with China

6:12

at risk, dollar sinks and gold

6:14

soards and spiraling trade war and

6:16

spiraling trade war, treas are trading

6:18

like risky assets and warning to

6:20

Trump. I mean, you said all

6:22

of this, but the expectation was

6:24

that yield would drop. The old

6:26

skyrocketing is a pretty bad side.

6:28

Yeah, I mean look, even more

6:30

than most times, I think the

6:32

illusion of control in this situation,

6:34

we're not only playing with live

6:36

ammunition, we're playing with entire arsenals

6:38

all at the same time, and

6:40

no one has, there's no precedent.

6:42

Well wait, I mean, it's quaint

6:44

now, there's just nothing that people

6:46

can compare this to because we

6:48

have no precedent. So of course

6:50

things are going to behave in

6:52

a way that is totally unpredictable

6:54

and I expected. they will point

6:56

to endlessly the fact that you

6:58

know chaos has been a strategy

7:00

historically he tends to relative you

7:02

know when we're talking about comparative

7:05

advantage he's certainly better in chaos

7:07

than in sort of normal situations

7:09

relative to other people on average

7:11

so maybe it's all again this

7:13

is where the sort of the

7:15

the 12D chest argument comes in

7:17

but you know for market participants

7:19

who want some amount of predictability

7:21

over what happens. The fact that

7:23

nothing is behaving, and no one

7:25

is behaving the way that they

7:27

might expect, except honestly China is

7:29

behaving exactly the way that you

7:31

expect in this situation, is not

7:33

a very comforting thing. I mean,

7:35

look at that monthly chart for

7:37

the 10-year yield, or back up

7:39

at 4.5 percent. This is not

7:41

supposed to happen, and I'm old

7:43

enough to remember a few months

7:45

ago when the Fed cut and

7:47

yields also went up. Right

7:50

these are the it seems like there's

7:52

no lever to pull right now to

7:54

make these yields go down to be

7:56

able to refinance the debt cheaper to

7:58

bring mortgages down for some relief. to

8:01

the average person and this is not

8:03

I'm not saying it's Trump's fault or

8:05

otherwise I'm just saying the classic tools

8:07

that you utilize to get yields down

8:09

are just not working. It's because there's

8:12

no amount of monetary policy is going

8:14

to fix political issues. It's as simple

8:16

as that, you know, the premise that

8:18

somehow we could create a totally unprecedented

8:20

situation that upends the entire global trading

8:23

order that has existed for 80 years

8:25

and think that markets are just going

8:27

to behave the way that they're supposed

8:29

to because you did X or Y

8:31

happens. Good luck, man. I think there's

8:34

a high level of delusion if we

8:36

think that we can just kind of

8:38

casually push on the same levers or

8:40

pull on the same levers that we

8:42

have before. And, you know, I mean,

8:45

look, maybe it's a good thing that

8:47

the market is sending the signal so

8:49

clearly, so early that that's simply not

8:51

going to be the case and there

8:53

is no control here. So to the

8:56

extent that we want the chaos to

8:58

be controlled, it's not going to come

9:00

from predictable market actions, I don't think.

9:02

reasons for why bonds to be selling

9:04

off and yields could be skyrocketing. I

9:07

haven't seen the evidence of it yet,

9:09

but it seems like common sense with

9:11

gold prices going up and bonds crashing

9:13

that China's retaliatory measure here behind the

9:15

behind the scenes might be to sell

9:18

off US debt. Obviously, it's sell off

9:20

US bonds and to buy gold. I'd

9:22

have to imagine that part of these

9:24

negotiations with all the countries that have

9:26

come in is the United States saying,

9:29

oh, you have to buy our treacheries.

9:31

Yeah, someone needs to tap Apollo on

9:33

the shoulder because tether's the only buyer

9:35

left, man. He's my, he's my podcast

9:37

for Sunday. I talked to him about

9:40

the other day. They're literally going to

9:42

be like number one by the time

9:44

this is all done. Yeah, well, out

9:46

of a group of one, you know,

9:48

by the time, this is all done.

9:51

Yeah, well, out of a group of

9:53

one, you know, by the time this

9:55

is all done. So, Bitcoin's recent drawdown

9:57

proves it's more than just a leverage

9:59

tech play, just by the 20. 6%

10:02

drop from all time. High as Bitcoin

10:04

holds steady compared to leading TechSock signaling

10:06

increasing maturity. I tend to agree with

10:08

this. Obviously we talked about it last

10:10

week before the Sunday drop, right? We

10:13

said holy, holy wow, Bitcoin is just

10:15

hanging out here at 82, 83, 81,000

10:17

while markets are in turmoil last Thursday

10:19

and Friday. Of course, then we ended

10:21

up getting to sell off on Sunday,

10:24

but I think we all know rationally

10:26

that when people are panicking to sell

10:28

the thing they can sell. and so

10:30

Bitcoin dropped but here we are all

10:32

this turmoil chilling at 82,000. Yeah I

10:35

mean look. We talk about this, it

10:37

feels like every week, but Bitcoin is

10:39

not an either or asset, it's a

10:41

both and asset, and it's got a

10:43

big weird coalition of buyers and holders

10:46

now, and it's going to behave in

10:48

contradictory ways at the same time because

10:50

of totally different patterns, interests and behaviors

10:52

of its base, and we often see

10:54

the weirdest sort of psychic fracturing at

10:57

these low points where the parts of

10:59

the holder base that are, you know,

11:01

sort of, it's just a risk asset

11:03

alongside their portfolio for portfolio construction. are

11:05

competing with the diehards who will hold

11:08

forever and who might even be quietly

11:10

scooping on the side. And those think

11:12

those we wore at the bottom. And

11:14

that's why I feel like we often

11:17

see this sort of we race down

11:19

with everyone else, but then we hit

11:21

sort of our floor more quickly and

11:23

stick there because of that inbound base.

11:25

So it's not particularly surprising to me.

11:28

I think every time we see this,

11:30

it's helpful in explaining this or helping

11:32

new participants in the market understand that

11:34

there are some very different dynamics of

11:36

Bitcoin. on the sort of bottom end

11:39

of these type of market cycles, but

11:41

it doesn't surprise me at all to

11:43

see it hanging out and holding. You

11:45

know, I wouldn't carry that on. Like

11:47

there is always more legs down to

11:50

be had. It's just that as we

11:52

start to reach bases, I think that

11:54

we have a stronger community than most

11:56

when it comes to it. Well, I

11:58

can tell you in my experience in

12:01

the last week and a half in

12:03

reading the comments constantly today and all

12:05

the other days is people don't like

12:07

these conversations. conversation is nauseating how about

12:09

give it a minute that's one of

12:12

them people saying we're judging him in

12:14

three months I will say everybody should

12:16

give the benefit of the doubt maybe

12:18

there is a grander play but it's

12:20

our job still to unpack what's happening

12:23

in the short term and it's hard

12:25

to think that there wasn't a smoother

12:27

way If you do this, maybe if

12:29

you, sorry, is accurate and maybe the...

12:31

Sorry, I'm gonna throw down here, Scott.

12:34

If you think this comment, this conversation

12:36

is nauseating, you are way to up

12:38

your own butt when it comes to

12:40

your perspective on people. If you can't

12:42

look at this situation, if you genuinely

12:45

think that you understand what's going on

12:47

or that anyone really understands what's going

12:49

on, do you have that thing and

12:51

it's not worth discussing, turn off the

12:53

TV for a while, my friend, because

12:56

you're wrong. and no one knows. We

12:58

are in completely uncharted territory. You don't

13:00

have to waste your time if you

13:02

don't like the conversation, but if you

13:04

think it's nauseating because, you know, your

13:07

boy's being critiqued, check yourself. That's how

13:09

I feel. Yeah, I mean, I keep

13:11

getting accused of TDS, and I like

13:13

to remind people of the kind of

13:15

conversations we had about Gary Gensor, Elizabeth,

13:18

Warren, and Joe Biden in the past

13:20

few years. Did I have JDS? Is

13:22

that a thing Joe? Yeah, look, Trump,

13:24

Trump's- We're just, we're just equal opportunity

13:26

critiquers. He's in the power sea right

13:29

now. Also, if you think that this

13:31

discourse that Scott and I have in

13:33

general is Trump critique, you are way

13:35

off the rocker for what critique looks

13:37

like. I mean, look, I don't, I

13:40

don't give a shit. I've, I have

13:42

lived for years with people on one

13:44

side thinking that I'm not enough, so.

13:46

Whatever, man, bring it on. I got

13:48

a podcast and you don't, so. Yeah,

13:51

listen, at the end of the day,

13:53

it's going to take time to see

13:55

how all of this sorts out, but

13:57

there's no way you can look at

13:59

this and think that the messaging has

14:02

been consistent and that everybody who is

14:04

driving markets right now is on board

14:06

with whatever plan is happening. Unless you

14:08

believe that Howard Lubbock is literally a

14:10

stoog who has decided as a billionaire.

14:13

to throw himself in front of the

14:15

bus on behalf of leader Trump. You

14:17

can't say, wow, what a brilliant negotiating

14:19

technique this is, look at all these

14:21

countries that came and also say we're

14:24

going to get an external revenue service

14:26

in the tariffs of the future of

14:28

American economy. Yeah, also you also like

14:30

it is again not to really hammer

14:32

on this But not critiquing people is

14:35

not patriotic if you think it's American

14:37

to just sit there and wait and

14:39

not have discourse around these issues Like

14:41

I don't know what history you're paying

14:43

attention to but it's not the history

14:46

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pivot to things we like, like the

16:01

Wall Street consultant Paul Atkins confirmed to

16:03

lead SEC. So while we can be

16:05

critical of Trump's tariff policy and debate

16:07

to death, whether it's intentional or why

16:09

it's happening, we all agree that Trump

16:12

right now for the industry outside of

16:14

price has been the best thing that

16:16

could possibly happen in the United States

16:18

for crypto. We've got pro Bitcoiners in

16:20

literally every seat of power, whether financial

16:23

or otherwise, and now we get an

16:25

absolutely massive win in the SEC after

16:27

already having an incredible win with Hester

16:29

Perce being the acting commissioner and rolling

16:31

back everything that Gary Gensler did and

16:34

more. Yeah, I mean, look, this is

16:36

nothing but good. This is also a

16:38

role that people were excited about him

16:40

playing for beyond just the Bitcoin implications.

16:42

We'll see, I would say that I'm

16:45

certainly a little gun shy of going

16:47

full-throated excitement for anyone. I worry that

16:49

there's something about the SEC chairman chair

16:51

that warps people. There's an anti-B Bitcoin

16:53

curse that was put on it at

16:56

some point by someone in the past,

16:58

but it's certainly optimistic relative to what...

17:00

it could have been and I think

17:02

nice to see that progress happening even

17:04

in the midst of other changes that

17:07

we don't have control over. Yeah I

17:09

mean it's not just the SEC either

17:11

of course there was obviously this week

17:13

the Trump signed the law overturning the

17:15

IRS rule. which was one of the

17:18

most hated things about the Biden administration

17:20

effectively calling brokers and defy, you know,

17:22

exchanges having to report. So that was

17:24

another massive positive. And of course, this,

17:26

U.S. Justice Department dispends crypto enforcement team,

17:29

citing Trump order. So now basically all

17:31

of the anti-scripto army infrastructure one by

17:33

one has been dismantled. I mean, we

17:35

saw it at the SEC. They had

17:37

a completely new mandate for their enforcement

17:40

team. Now the DOJ. as a new

17:42

mandate for their enforcement team. This is

17:44

absolutely incredible. And more importantly than all

17:46

of that, which we've talked about in

17:48

the past, is the ending of Operation

17:51

Cho point 2.0 and how the bank

17:53

regulators have rolled all these rules back.

17:55

Yeah, the creation of this team was

17:57

a sort of clear sign of the

17:59

ramp up of Cho point 2.0, the

18:02

unmaking of it is the reverse sign.

18:04

Firmly. in the category of exactly what

18:06

you'd hope to see, exactly along the

18:08

trend lines, that seems so positive, but

18:10

still really powerful in that it's sort

18:13

of, you know, the coming to fruition

18:15

of those changes. And also I think,

18:17

you know, in general. we've seen a

18:19

lot of faster changes in the agencies.

18:21

And I think that where people's attention

18:24

shifted after that was to Treasury, to

18:26

DOJ, you know, to kind of understand

18:28

how these other antagonists in the past

18:30

were going to behave, even as, you

18:32

know, the SEC and the CFTC kind

18:35

of get on board. So very positive,

18:37

even if, you know, kind of the

18:39

type of thing that we would hope

18:41

to, we would have seen. Yeah, we

18:43

have kind of a couple stories here

18:46

that really speak to this emerging crossover

18:48

between the Bitcoin industry, the crypto industry,

18:50

and Tradfai, and in this new sort

18:52

of. regulatory environment with an expectation of

18:54

more clarity on legislation. We're seeing a

18:57

lot of moves that we definitely wouldn't

18:59

have seen in the past, one of

19:01

which is tether eyes new US-based stable

19:03

coin for institution. As regulation advances, I

19:06

did talk to Palo a bit about

19:08

this. He was pretty clear to say,

19:10

we're not saying tether's not going to

19:12

be allowed in the United States. He

19:14

believes they will. This is just like

19:17

a product that's even more tailored towards

19:19

United States institutions, but the very fact

19:21

that... Palo Artoino of tether is able

19:23

to walk around in Washington DC for

19:25

the first time and have conversations with

19:28

legislators and is backed by Lutnik tells

19:30

you everything you need to know about

19:32

this massive sea change that we've seen

19:34

with regulation legislation in the industry. He

19:36

used to think that he might get

19:39

jailed if he stepped foot in the

19:41

United States because of all the tether

19:43

fun. Yeah, I mean look I think

19:45

this is a this makes sense to

19:47

me as a strategic move a way

19:50

to kind of play in this market

19:52

But not also give up the the

19:54

opportunity that that That exists in tether

19:56

as it's currently constructed. They're clearly building

19:58

out the narrative framework for it, which

20:01

is totally coherent these products serve different

20:03

markets and so they want to actually

20:05

offer products that fit, you know, the

20:07

different market dynamics. So, you know, I

20:09

think it's bullish. In general, whenever banks

20:12

get involved, it tends more often to

20:14

be consolidation in our official barriers than

20:16

it does to be big free market

20:18

participation. So having our sort of most

20:20

powerful crypto-native institutions be able to take

20:23

their swings and compete feels like a

20:25

positive win to me for consumers and

20:27

businesses who want choice. And to that

20:29

end, though, it's been interesting because the

20:31

incumbents have largely been locked out of

20:34

the crypto industry in the United States

20:36

and were screaming from the sidelines that

20:38

they wanted a piece of it, right?

20:40

And to that end, when the ETFs

20:42

were launched because of SAB-121, we saw

20:45

Coinbase effectively get to custody 80% of

20:47

the ETFs, right? And now we have

20:49

a situation where because SAB-121 has clearly

20:51

been rescinded and the banks are starting

20:53

to get... their way and be able

20:56

to participate in this industry. One of

20:58

those track by crypto crossover stories, it's

21:00

huge, is Anchorage Digital becomes newest digital

21:02

asset service provider for Blackrock. Blackrock was

21:04

customating their ETF with coin base. This

21:07

is basically Anchorage, if you're not aware,

21:09

Anchorage is the only US federally chartered

21:11

digital asset bank. and they will now

21:13

be participating in the custody of all

21:15

of Black Rocks digital assets, including some

21:18

of the ETF assets. So this is

21:20

a diversification for them and also a

21:22

move now from the federally chartered banks

21:24

into the space for custody. Yeah,

21:27

I mean look this this was a

21:29

quietly the sort of theme of the

21:31

week had there been no tariffs the

21:33

big blaring headline for us I think

21:35

would have been just this wave of

21:38

Tradfai crypto native institutional overlap this was

21:40

leading but there are a slew of

21:42

other stories like this again to the

21:44

extent that what we were saying about

21:46

the sort of the crypto enforcement unit

21:49

going away. being an indicator of just

21:51

the strong trend lines towards a different

21:53

industry. This is the other side of

21:55

that. The Tradfai world coming together with

21:57

the crypto native world and participating. And

21:59

I think in the form of these

22:02

institutional alliances is, you know, I think

22:04

a very positive sign. And also I

22:06

think to the extent that we are,

22:08

you know, concerned, and not everyone is,

22:10

but to the extent that one is

22:13

concerned with a set of very powerful

22:15

institutions that don't necessarily share the crypto

22:17

industry's values coming in doing all of

22:19

the kind of the market activity, the

22:21

fact that you're seeing so much interest

22:23

in partnership and alliance and basically bring

22:26

those crypto native. companies into the fold

22:28

rather than just trying to out-compete them

22:30

from the ground up, I think is

22:32

also a positive sign. Yeah, bring it

22:34

at home. That's a theme right here.

22:37

Galaxy Digital Gaines, SEC approval for Delaware

22:39

moved, NAS that expected in May. So

22:41

Galaxy was based in the Cayman Islands.

22:43

They're now becoming a Delaware corporation. This

22:45

would have never happened. any time in

22:47

the history before now that a company

22:50

like Galaxy would be comfortable being registered

22:52

solely in the United States for all

22:54

their actions and they're planning to direct

22:56

list on the NASDAQ because they're already

22:58

traded on Canadian exchange. Yeah, no, this

23:00

is, I mean, this has been a

23:03

long time in the works for these

23:05

guys and it just hasn't hasn't been

23:07

the right time yet. Now, there's still

23:09

some progress to be made. I think

23:11

that they're trading at around half of

23:14

the market cap. of what they would

23:16

need for NASDAQ. But, you know, again,

23:18

all things pointing towards the right direction

23:20

here. Yeah, and then the final one

23:22

is kind of the flip side of

23:24

this. Ironically, we saw the roller coaster

23:27

of circle and their IPOs. Now they're

23:29

considering an IPO delay. with the economic

23:31

uncertainty and all the tariffs. But in

23:33

the past cycle, we know that they

23:35

tried to list by SPAC. That completely

23:38

fell through. There was a very little

23:40

merger acquisition, IPO, direct listing going on

23:42

for the past few years, many viewing

23:44

the new environment great for that in

23:46

crypto and beyond. They were about to

23:48

list again, how say they might not

23:51

list. Yeah, I mean, listen, I think

23:53

that this is. I don't think that

23:55

this is particularly circle specific. I think

23:57

there is... a big freeze in risk

23:59

assets. You're seeing it in the venture

24:02

world. I mean, every VC that I

24:04

know that was trying to go out

24:06

and raise funds is now freaking out

24:08

because LPs are all sitting on their

24:10

hands and that's gonna have downstream effects

24:12

on how startups get funded. And part

24:15

of the issue is that there's no

24:17

liquidity profile, right? There was an interesting

24:19

profile of precursor ventures in the information

24:21

recently. And they were talking Charles Hudson,

24:23

the partner of that fund was explaining

24:25

how he anticipates for the next. five

24:28

years, liquidity and his returns to investors

24:30

are going to be 75 to 80%

24:32

shares on, you know, shares of secondary

24:34

is basically that he just does not

24:36

anticipate significant M&A and IPO behavior for,

24:39

you know, the foreseeable future. So it's

24:41

not just circle is the point that

24:43

the IPOs that we had been excited

24:45

about are all kind of on pause

24:47

until further notice. And I think it's

24:49

a rough one for circle because it

24:52

did seem like there's a window before,

24:54

you know, big competitors come in to

24:56

their space. It is a crazy time

24:58

because when the last administration went out,

25:00

it seemed all systems go. And now

25:03

because markets are being rocked, they're having

25:05

to pause and all this happening in

25:07

a matter of months, I mean, I

25:09

just hit the quick, quick chat GBT

25:11

to see what other companies were basically

25:13

delaying IPOs due to tariff induced market

25:16

volatility, klarna. Obviously, the Swedish event tech

25:18

company stub hub, everybody knows online ticketing.

25:20

all the way down to E-Toro and

25:22

crypto medline industries. I mean there's quite

25:24

a lot of companies that were just

25:27

on the cusp of doing it and

25:29

now are just hitting pause until they

25:31

see what happens. This is not unique

25:33

to circle as you said. Yep. And

25:35

again, as nauseating as this conversation may

25:37

be for some of you, this is

25:40

the type of thing that happens when

25:42

we don't know what's going on. And

25:44

that's not a critique of the policy's

25:46

a priority or a judgment of whether

25:48

they'll ultimately work for whatever their objective

25:51

is. The point is that we're operating

25:53

in a world where no one knows

25:55

what tomorrow is going to hold. That

25:57

is a very, very difficult environment for

25:59

market participants. It allows for no planning.

26:01

It allows for no strategy. It basically.

26:04

action is based on that day. That's

26:06

not where markets want to be. And

26:08

there are impacts to that, whether you

26:10

think they're worth it or not, there

26:12

are impacts. And we're seeing them start

26:14

to materialize. And I think that the

26:17

big important part of this and the

26:19

part that is very clear from where

26:21

I sit, you know, living inside startup

26:23

and venture land and dealing with funding

26:25

issues and things like that. insecurity around

26:28

what happens next. Yeah, and so for

26:30

the entire section of risk assets, it

26:32

might as well have been nothing changed.

26:34

You know, in fact, to your point,

26:36

Scott, it might actually be worse in

26:38

some ways to have this sort of

26:40

flip-plopping. So, you know, that's just the

26:42

reality. You know, again, it doesn't mean

26:45

that the reality won't be worth it

26:47

on the other side, but that's the

26:49

reality that we're living in right now.

26:51

Yeah, I mean, there are plenty of

26:53

things that you can look at as

26:55

historic facts that are happening right now

26:57

that are not up for debate. You

26:59

can debate endlessly what the intention is,

27:02

but 12% NASDAQ market swings to

27:04

the upside in a down trend

27:06

are never signs of a bull market. And

27:08

we saw 50% of that retrace. The

27:10

biggest crazy, insane volatility and bullish rallies

27:12

are not a sign of a healthy,

27:14

slowly grinding bull market to the upside.

27:17

The last time we had to move

27:19

that big on the NASDAQ was... 2008

27:21

and everybody remembers what happened

27:23

after 2008. So I think that people just

27:25

don't know what to do right now and

27:27

maybe there's a master plan and maybe

27:29

we'll get there and there will be

27:31

certainty but for now I expect continued

27:33

insane volatility every tweet to send markets

27:35

up and down and for us to

27:37

just brace and hope for the best.

27:39

I mean listen I will say I've

27:42

said before I continue to think that

27:44

crypto people are best at least emotionally

27:46

or psychologically situated for this type of

27:48

volatility. You know, it's the kind of

27:50

like everyone's have to has to live

27:52

in our world now for a little

27:54

bit. And so once we kind of,

27:56

you know, crock that, we can take advantage of our

27:58

psychic scars maybe go profit during during

28:00

you know, listen, know, it could be

28:02

worse. could be worse. can't wait to see

28:04

what we're talking about next week,

28:06

but my next says my bingo card says tariffs. Yeah,

28:08

we'll see. see. All All right, guys, EdelW

28:10

a a follow, check out the

28:12

breakdown, of course, follow about X, check out

28:14

his YouTube channel and we will

28:16

be back for the next Friday the

28:19

next week. Thank you, man. next week.

28:21

man we have. and we guys. guys.