Institutional Crypto Adoption: Opportunities & Obstacles with Brett Tejpaul, Head of Institutional Sales, Trading, Custody & Prime Services, Coinbase. Glenn Barber, Head of Sales & Business Development, Copper. Brian Brooks, Former Acting Comptroller of the Currency. Jalak Jobanputra, Founding Partner, Future\Perfect Ventures.
Moderated by Daniel Roberts, Editor-in-Chief, Decrypt.
SPEAKERS
Brett Tejpaul
Head of Institutional Sales, Trading, Custody & Prime Services
Coinbase
Glenn Barber
Head of Sales & Business Development
Copper
Brian Brooks
Former Acting Comptroller of the Currency
Jalak Jobanputra
Founding Partner
Future\Perfect Ventures
MODERATOR
Daniel Roberts
Editor-in-Chief
Decrypt
TIMESTAMPS
EPISODE TRANSCRIPT
Daniel Roberts: (00:00)
All right, finishing out the day here with more Crypto Talk. Thank you to everyone who's here, delighted to be with this all-star panel.
Daniel Roberts: (00:14)
Let me just start quickly by saying, when you do a lot of these conferences, you start to see some of the same folks on the circuit. I remember when SALT, just a few years ago, had maybe a little touch of Crypto in the mix. And you look around today at the lineup for the last three days, and I think that, that says a lot about institutional interest in Crypto. I mean, half the sponsors and a good mix of the panelists are about Crypto, I think that really tells you where institutional interests stands in the space. But we only have a little time, let's dive right in.
Daniel Roberts: (00:43)
Brett, good way to start would be to talk about this Coinbase, $2 billion debt offering that reports indicate you guys had hugely oversubscribed, tons of interest. What's going on there, especially an obvious indication of maybe some investors that, a few years ago, were more skeptical, ready to dive in?
Brett Tejpaul: (01:01)
I think it's an awesome moment for Coinbase and for Crypto. The fact that so many hundreds of investors put in orders for that deal is fantastic. The fact that they bought seven and 10 year debt is amazing. Particularly if you contrast it versus an investment in equities, right? When you're on the fixed income side, you're making a bet of the longevity and stability of the platform. You'll get your money back at the end of 10 years. So I think it's an enormous endorsement for the industry and for Coinbase too. And then with respect to the investors, it's quite frankly amazing to see the biggest, largest, most sophisticated asset managers in the world, in that transaction. Many of whom are already clients, but actually so many, I hope, will join the platform thereafter.
Daniel Roberts: (01:50)
You guys are going to hear me hit this a lot, but the idea that we've seen the interest from institutions, especially maybe firms or individual investors that I think as recently as three years ago, were dismissing Crypto. Now they're ready to rush in, people can ask, "Are they late? Maybe they're still early." But Brian Brooks said "Kick it over to you." In case anyone here doesn't know, I don't want to assume Crypto knowledge of everyone's background, but Brian was the CEO of Binance.US until just recently. And before that he was a regulator himself.
Daniel Roberts: (02:19)
Brian, what did you see in your time at Binance.US in terms of the institutional interest? And what I'd really ask all of you guys is, was it really the pandemic that changed everything? I mean, there was this narrative that the actions of the fed and inflation, and that's why a lot of people changed their tune on Crypto. But it was kind of happening before the pandemic started, right?
Brian Brooks: (02:39)
Yeah, for sure. I mean, look, we've had an accommodative, monetary and fiscal policy in this country going back 10 or 12 years at this point. So it's an incredibly risk-on environment, which means Crypto. It means anything with vol in it. Anything that's new is awesome. What I think is interesting though, and Brett on the Coinbase side, it's really interesting, is yet today most institutions are not willing to hold primary Crypto assets. Institutions that are licensed, can't participate in DeFi. So how do they to get exposure if they want to be risk-on in crypto? And the answer is, you find a public company and you would invest in their debt. That's an exposure to crypto, but it's not actually crypto. So I think the big regulatory question is, how do we actually open this up for real institutional participation in the underlying projects we're all working on? That's the heavy lift for the next year or two.
Daniel Roberts: (03:26)
Jalak, I mean, let's talk about what you do at FuturePerfect. Another way to get exposure to crypto, obviously, is on the VC side to invest in some of these crypto companies, how has your thesis been affected by the obvious rise in institutional interest?
Jalak Jobanputra: (03:41)
Well, I started the fund in 2014 on the thesis that everything was going to be tokenized and started with Bitcoin. And Bitcoin was really the primary crypto asset out there. But I invested early in the internet and I looked at any technology developments. And you first have to invest in infrastructure, and then you invest in connectivity, middleware, and what's now considered layer two. And then the applications, which we're starting to see happen right now. And, so it's been, obviously the last year has been phenomenal in terms of the growth, but we always knew that the institutions were going to come because of the macro environment we're in.
Jalak Jobanputra: (04:26)
I think one of the things that was missing is that regulatory uncertainty, and it's still not quite there. And I mean, you look at DeFi, we're very actively investing in DeFi. We're actively investing in NFT infrastructure. We're actively investing in institutional infrastructure, but it seems like the technology is ahead of the regulation, but given the demand we've seen from institutions as well as retail investors, this will all be figured out. And I think the next five years are going to be the most exciting time to invest in the sector.
Daniel Roberts: (05:02)
Let's talk a little bit more about your portfolio at the firm. You mentioned regulatory uncertainty, I mean, that's an understatement, right? And as you look at companies to invest in right now, is that coming up as one of the main topics of, "Well, how do we deal with this? This might be an obstacle for us." What are the primary things that you were looking for when you're investing in the crypto space right now?
Jalak Jobanputra: (05:23)
So when we first started investing, there was a lot of regulatory uncertainty, Mt. Gox had just happened, that's actually what got me into this.
Daniel Roberts: (05:31)
Way back.
Jalak Jobanputra: (05:32)
And that's what got me into the sector because of the resilience that Bitcoin, and then the entrepreneur is building on this technology showed. And so I thought this is not going away. And obviously when everyone else is running away, that's the best time, especially to be a venture investor. But we do pay attention to and invest in entrepreneurs who understand that there are regulatory constraints. We invest globally. So I was just talking to Brian before, I've been talking to regulators around the world, educating them about this new asset class. And so we help the entrepreneurs navigate different jurisdictions, including the US, and I don't think one size fits all. Every environment is different there. I mean, we have legacy infrastructure here. We have legacy regulation here that doesn't exist in some other places, but the US is still going to be an important market for the sector.
Daniel Roberts: (06:31)
Please.
Brett Tejpaul: (06:31)
Just one reflection on this, given the crowd that we have here today. So I spent my first 25 years in investment banking, bringing new asset classes to institutional investors. So leading them into emerging markets and illiquid assets, so on and so forth. And during all those years, usually regulation follows innovation. And so there wasn't a moment in time where it was crystal-clear of what the regulatory backdrop was and enabled the capital income. So if you just look at what's actually happening now, our debt deal, but also our balances, people are actually taking the brave step to make direct investment. So I think that the space will certainly prosper with more clarity, but I think it'll continue to grow on unbounded in the meanwhile.
Daniel Roberts: (07:15)
Glenn, I want to bring you into this. Let's talk about Copper.co and working with the institutional clients you do, especially on custody. Especially keeping with the fact that this is SALT. This isn't just a crypto conference. I don't want to assume any automatic knowledge. Can you explain just briefly for everyone what it even means to work with institutional clients on crypto custody and that part of it? When people are coming to you guys, what are the different questions they're asking and what is it they're looking for?
Glenn Barber: (07:40)
Sure. And I think this ties back into what we started the panel with, right? In terms of institutional adoption. I mean, I think one of the things that people that are getting into crypto or new to crypto don't realize are, that we have so many investor protections that have been layered into our systems in traditional finance, whether it's equities, bonds, fixed income, even over years, right? We've had calamities, we've had theft, we've had problems and, therefore new things are brought in. So we're talking about custody, clearing settlement, depository trust corporation, options clearing Corp, right? And really what I think people here really want to see is, "Okay, I'm familiar that if I have assets that I'm managing on behalf of other people, and I have a fiduciary responsibility, well, what is Mike Williams of State Street? Or Bank of New York? Or Citigroup? Or JP Morgan in custody?"
Glenn Barber: (08:31)
And that's what Copper and some of our other competitors and colleagues are, right? We are designed to provide safekeeping of assets, and each of us does it in a slightly different way, but the bottom line is that no one wants their assets that they're being managed on behalf of investors or LPs to go away and to get hacked, right? And so, crypto custody is very technical in nature. It involves military-grade security and technology, but the base layer value proposition is simply, "How do I make sure that if I'm going to buy digital assets, they're stored in a place where I really don't think they're going to leave?" Right? And I think that's part of the pipes and plumbing that a lot of people here would like to see and will have been being built over the last couple of years, to get them to a comfort level where they can explore further.
Daniel Roberts: (09:20)
And how much does the narrative play into it? Being from the media side, I know that a lot of people who still have stayed away from crypto, it's because it is an extremely narrative-driven, headline-driven space. When you talk about custody, you mentioned the fear of getting hacked, the fear of losing your investments. I mean, of course, and I think that there are a lot of people from the traditional investing world or traditional Wall Street types who, every so often they see a headline about either an exchange being hacked or the New York Times story a year ago about people who lost their keys, and so they can never access that Bitcoin. That went kind of viral, and I understand why. People see a headline and they say, "Wait a minute. You can just lose it? It's so unsafe." How do you guys combat those kinds of misconceptions? We kind of have the opportunity here today, maybe, to combat some of those misconceptions. When you're hearing from more conservative, cautious investors, is that the concern a lot of times is, "I could lose this stuff"?
Brett Tejpaul: (10:12)
Well, at least our approach to it is, it's like your own, which is to make it a fortress, an un-penetrable fortress that's never been hacked, which is where we're at. Custody for us is a foundational element for the prime platform. But you don't want to just buy an asset and have it sit there. You may want to finance it. You may want to stake it. You may want to do other things. And so in a similar way, we've built a platform to meet the rigorous due diligence requirements of institutional investors in the same way that they would undergo diligence of Goldman Sachs or JP Morgan or others. And so if you can put crypto and position it relative to other financial assets and evaluate its operational risks, security, and other elements of risk relative to financial assets, you'll find that, actually, crypto, in many cases, is more secure and it's at a step above.
Brian Brooks: (11:02)
Can I just jump in on this for a second? One of the things that we don't do a great job as a community in conveying to the world is, we're new so we seem risky. And we never asked the question risky compared to what, right? So think about the Equifax data breach, where all of your credit bureau information was leaked to a bunch of Russian hackers and sold. Okay? Or imagine the Target hack where all of your American Express numbers were sold on the dark web as a consequence of it.
Brian Brooks: (11:30)
When I was the controller, I fined two banks $140 million for cyber breaches on the main banking platform. When people talk about crypto, nobody talks about that because those risks, we believe, are the state of nature and we're new. We need to start talking more about the problems we're solving, right? Incrementally, there might be new risk, but on net, there's probably less risk, Brett, just as you say, and that's the story we don't do a great job of telling. So we let the incumbents win the narrative, even though the less risky option probably as a public back-to-back transparent blockchain.
Brett Tejpaul: (12:06)
Well said.
Jalak Jobanputra: (12:07)
Yeah. 100%. I'm just nodding because I'm a technology investor, and why I got into this sector was what was possible with the data security and the technology and the tokenization. And I am amazed all the time when I hear people talking about how they still believe you can't track these transactions. They don't understand the private public key cryptography and how that has kept the Bitcoin blockchain secure all along.
Jalak Jobanputra: (12:39)
And so there's just a lot of misunderstanding. And if you look at our healthcare data that's sold all over the dark web, that premiums, the credit card data. And a lot of this underlying technology can solve that and our assets. And if you believe everything's going to be tokenized and we're going to have hundreds and thousands of different crypto assets there that are tokenized and they can be kept secure. And we can say our healthcare data can be kept secure, and we can potentially trade with that data and make sure that it's secure and we can monetize it. And so it's a world I think a lot of people don't yet grasp. And I do think as an industry, we're coming along on all of that, and it's great to see the institutional adoption because a lot of these institutions do a lot of diligence before they invest and they see that.
Daniel Roberts: (13:37)
Brian, you said something interesting there about what problem is actually being solved. And a lot of the times, when I'm hearing from kind of crypto skeptics, that's what they ask is like, "Well, why do I need to own Bitcoin?" And in many ways the narratives have become, "Bitcoin digital gold, hold on to it as an investment."
Daniel Roberts: (13:54)
And then Brad, earlier you mentioned that firms increasingly want to do something with their investment, stake it, lend it out, make more money on it. You're really getting into DeFi, Decentralized Finance. And there are still, obviously, so many people who they're just at surface level, they're still starting to try to understand Bitcoin. And then you bring in Ethereum and staking and protocols and layer two and all this stuff. And your mind races. Long way of asking you guys, are you hearing from firms now that are also trying to get a one-on-one and understanding it's gone beyond just, "I think we're ready to buy some Bitcoin and we'd like you to custody it for us." Now it's become, "Well, how can we build on our investment and do more with it," right? But they need to learn about those tools.
Brett Tejpaul: (14:34)
Yeah. So the light bulb on moment for institutions, I think, is shining bright right now. And one thing I'll say is, it's not all about Bitcoin. And so the four buckets that I would put different inquiries into is direct investment, for sure. It could be Bitcoin plus others. About 75% of our institutional clients own more than just Bitcoin. And then of that lot that owns more, most own E and at least 25% of them own at least five cryptocurrencies. So direct investments, obviously, number one.
Brett Tejpaul: (15:07)
Number two is, institutions are thinking through business-to-business critical applications. So that's using coin basis pipes and plumbing to enable their end clients. So that's bucket two.
Brett Tejpaul: (15:18)
Bucket three is stable coins. And so that's going through stable coins and smart contracts and thinking through the utility function of crypto beyond and away from speculative investment.
Brett Tejpaul: (15:27)
And the last one is what I call Future of Finance, which is where I'll group in DeFi and NFTs. And so there's a whole surge of interest and enthusiasm from art, sports, everything in NFT, as you know right now. And so those are the four buckets that I put investor interest into.
Glenn Barber: (15:46)
And I think I'd like to add to that, right? And one thing I'd like to impress upon the audience is that, like Brad, I come from the traditional world, I've got 30 years global capital markets experience, and I want to come off as reasonable and understandable, right? So I'm going to say two things that I hope people can get their heads around.
Glenn Barber: (16:06)
Number one, I think people don't really understand quite yet how revolutionary blockchain technology is and how it's going to scale and make the world more efficient in several different industries that we're all aware of, whether it's transportation, real estate, logistics, finance, and the like.
Glenn Barber: (16:23)
And the second point I'd like to leave you guys with is that, make no mistake about it. Digital assets is the capital market's opportunity of the next generation, right? And I don't want this to come from someone like us on stage where it's just a bunch of crypto guys and girls trying to show their product. This is the new global economy being built as we speak as in investors and financial market participants, I believe in, and this might sound controversial, but I believe you owe it to yourself to do the research, to figure this out because the returns are going to be there. You're investing in the new world that's coming down the pipe, that's going to be run by the people that we consider our sons and daughters. And this is just the facts.
Brett Tejpaul: (17:11)
Yeah. Mic drop. Love it. We already have billions of tokenized assets in our inner custodian. And so I love walking around my neighborhood, which is full of traditional finance people and telling them we've just tokenized five different real estate buildings in the Houston area. And no one believes me. But yet to your point earlier, tokenization is certainly an enormous opportunity.
Jalak Jobanputra: (17:35)
And it's also the access. And if you think about broadening financial access, and I've been investing in FinTech for a while, I was born in Kenya, spent a lot of time in the emerging markets, and you think of how much of the world is excluded. First it was just banking, but being able to invest and save and lend. And we're seeing this happen with DeFi, where people can connect peer-to-peer, they can decide what their risk and reward profile is. And we're still not quite there 100% yet, but that will happen in the next five years.
Jalak Jobanputra: (18:10)
And then I view it as this is going to benefit all of us. Where you said, I started off on Wall Street before I was a tech investor and worked on the Netscape IPO in 1995. And so I've been watching technology evolution. And I think we're in 1996 internet, and in terms of where we are with crypto, the differences, because this is open-source technology and because we have the global connectivity, that the internet and mobile enabled, we're going to see much faster development than we saw in previous technology and with the internet. So this is like, "Get on this right now for that opportunity in the next five to 10 years."
Daniel Roberts: (18:56)
To Glenn's point about making sure that it's not just a panel of crypto people saying, "Hey, believe in crypto," decrypts, we are aggressively neutral. We cover the good, the bad, and the ugly in the industry. And I do think there's a little bit of, over the last few years, crypto panels or conferences or media, it's people who have fully bought in saying, "It's great. Come on in." And maybe what has changed recently is people who were cautious getting in. But I think it's a good segue to talk about the regulation side, because there's a little bit of the same thing where you have lawmakers who recognize, at the very least, this is a thing that is going to continue to exist. And for many of them they're saying, "So we need to regulate it."
Daniel Roberts: (19:33)
But first there's a learning curve and they need to understand it. It's what tech companies always say, "Well, first let us teach you about how our tech works. Then you can regulate us." And I just want to get, all of you, let's not square them too much, but in terms of regulation, what do these companies do when you have a, uncertain at times, opaque framework? And basically you're hearing, "We're going to regulate business, but we're still not quite sure how we want to regulate it." We could start with Brian, who's obviously been there and done it.
Brian Brooks: (20:02)
I mean, my first advice to you is, don't go work in a regulatory agency and live this life. That would be my first advice. But one of the things we have to get a grip on in this country is what activity should be regulated. So it's a weird question. "Hey, you're doing something. Show me what regulation you're compliant with." Imagine that you were starting a lemonade stand or a clothing business or a fashion design house or any number of other things. The first question would never be, "Show me how you're regulated." But it kind of is nowadays. You hear stories of kids' lemonade stands being shut down by the local health authorities because they don't have a permit. There's a weird cultural thing going on. So I think I don't start with the regulation. I start with, "What is the activity that we're doing here and what aspects of it ought to be regulated?"
Brian Brooks: (20:48)
And I don't start with the assumption that everything that's happening in crypto land ought to be subject to banking or securities regulation. And the reason is because most banking and securities regulation is about individual human issues. It could be about human negligence. It could be about self-dealing. It could be about fraud. It could be about discrimination. But if you go through the US code and look at all of the American financial regulations, the significant majority of it is about the people who work at the bank. And here's sort of a mission statement about crypto. There are no people there's only code, right? That's why the mission of crypto is to say it in code we trust. We're taking all of the discretion and the negligence and the fraud and the self-dealing out of the equation. And what's left is a need to make sure that there's basic disclosure, to make sure that losses are compensated, and things like that, hacking and cyber standards, that sort of thing.
Brian Brooks: (21:42)
I don't think we have a consensus on this in this country right now. And if you just look at yesterday's hearing in the Senate Banking Committee and the way that Gary Gensler was treated by the Democrats versus the Republicans, you could see that there's a fundamental chasm between the Democrats who believe every activity that involves value should be subject to securities regulation, and the Republicans who were asking, "Well, why don't we understand what this is and figure out if there is a regulatory regime that makes any sense?" I'll just end with Balaji Srinivasan's comment that I always quote, which is, "When the YouTube people founded YouTube, did anybody think they should get a broadcast television license? I don't think so."
Daniel Roberts: (22:22)
Brett from Coinbase's perch, we have a recent news peg to ask about this, which is of course, Brian Armstrong, your CEO tweeting out the news that the SEC had basically indicated that if you launch this upcoming high yield lend product, we're going to have an issue there. How are you guys approaching and dealing with the different regulatory indicators?
Brett Tejpaul: (22:41)
I'll let Brian's comments stand for themselves. I suppose my perspective is informed by the fact that I worked 25 years within the context of investment banking. And as a pragmatist, I assume that at some point, these are my personal views of those of Coinbase, but I assume that there'll be some form of regulatory regime. So when I was at Barclays and JP, I ran global businesses and we had to meet the regulatory requirements across every country in which we operated. And so I hope we'll get to the right place on the balance of regulation. And I assume that we'll be compliant as Brian opted early in the Foundation of Coinbase to opt into regulation, to actually avoid and try and control some of the self-regulation and bad behavior that might otherwise be there if you hadn't made that election. [inaudible 00:23:31]
Glenn Barber: (23:31)
The way I look at it, I think there's a lot of news articles out there, and there's a lot of varying positions. Look, let's face it. We're a fractured country at this point, right? The way that I look at some of these things is that we have an opportunity to either do something that's going to affect the future and maintain what could be a very significant competitive advantage in terms of financing and the way that we do things with technology, or we're going to lose it, right?
Glenn Barber: (23:57)
Because the one thing that a lot of people that are citizens of a particular nation state, for example, whether it's United States, China, somewhere in Europe, don't really think about a lot, is that this is a global border-less, permission-less ecosystem. And that the United States wants to take its time or do something silly because the politicians that are way too old to be native and understand this technology for it to make sense to them, if they're going to screw around with it, well, there are countries that are not going to screw around with it. So it will simply migrate to Switzerland or Japan or Australia or the UK or anyone that has a favorable regulatory environment that says, "We're not going to be silly about this," right? And it's like that ball that you squish and it shoots out in different areas. That's going to be the way the world develops, right? And not enough people pay attention to this because this is a unique asset class that started globally in nature without sort of morphing from some domicile that we're all kind of familiar with.
Daniel Roberts: (25:00)
And it goes back, Jalak, to your point about investing globally.
Jalak Jobanputra: (25:04)
Yep.
Daniel Roberts: (25:05)
Is that causing a shift in terms of, maybe, the best areas for investment growth are outside the US if regulation is going to look unfriendly?
Jalak Jobanputra: (25:12)
Yeah. And that's right from the get-go. So it also goes into this whole ethos of what the technology is about is decentralization. So we've never believed that there's one place that is going to dominate. And I also believe that the emerging markets are going to be places where we're going to see some of the most interesting business models, because we don't have the legacy infrastructure within finance and financial assets. People want access to real estate, and just like you can buy $5 worth of Bitcoin. You can maybe buy $5 of the coffee shop down the street from you and share on the revenue. And that's something that just seems foreign to people that are used to abundance and used to having access. And so I think the US really suffers from an incumbent problem, which, frankly, a lot of Wall Street did for many years around this technology.
Jalak Jobanputra: (26:14)
And this has happened with the internet, right? I mean, the blockbuster story. Did anyone actually think that we were going to be watching videos at home streaming? And so I think these business models are going to emerge. They're going to emerge very quickly. They are emerging very quickly. And there are a lot of regions around the world, India is an example. We've invested quite a bit in India. They basically shut down the crypto sector for several years. My view was that they're always just trying to fit similar to China, trying to figure out how they're going to regulate the sector or how they're going to get involved in it. MADEC. We have amazing entrepreneurs coming out of India right now. And they all just went underground, built to be a peer-to-peer technology. And the government realizes they can't stop that. And so the US should realize that soon that they're not going to be able to stop this. If we want to keep talent here, we want to keep innovation here, they're going to have to be a friendly environment.
Daniel Roberts: (27:22)
Love blockbuster.
Brett Tejpaul: (27:23)
Well, if we let this thread run too long, I think it would give the audience the wrong impression that it's a massive binding constraint. And so, one of the things I want to call out is for our institutional platform, since we set it up in mind with being compliant, being regulated and adhering to KYC and AML, we route to 12 different venues, all of whom uphold KYC and AML. And so while the crypto landscape is huge and stretches across geographies and to unregulated spaces, at least the business that we've set up is purposeful to operate within a subset of it where we think that we can conduct business safely.
Daniel Roberts: (28:04)
Well, and I want it to end on asking you guys, and I feel like you did this and Glenn, you talked about this too, but just real quick in the couple of minutes we have left, what are the biggest misconceptions that you hear from either peers in tech or investing that haven't gotten into crypto or potential customers or clients who've come to you? From your time at Binance, Ryan, what have you heard that you think are the most common misconceptions you're often battling? It might be a useful thing for, for this audience.
Brian Brooks: (28:29)
Yeah, well look, one thing that I've heard people, both when I worked at Coinbase, when I worked at Binance, and when I was the regulator, was the idea that, "If I'm touching crypto, I can't get access to the traditional financial system. A bank won't bank me if I'm touching crypto or whatever." One of the things I tried to do in my time in government was to make clear that these are investible assets, that banks can participate in payment systems that are built on blockchain, the same as payment systems that aren't, it's fully safe for the traditional financial system to interact with us. And they now are at some amount of scale. So I'm very proud of that.
Daniel Roberts: (28:58)
Jalak?
Jalak Jobanputra: (29:02)
Well, I think there's still a misconception that this sector is full of money launderers and people who have nefarious kind of objectives in mind. And we've moved so far beyond that. And actually, Satoshi, everyone that I got to know in the sector in 2013, and ...
Daniel Roberts: (29:21)
Wait, you knew Satoshi?
Jalak Jobanputra: (29:21)
What?
Daniel Roberts: (29:22)
You knew Satoshi?
Jalak Jobanputra: (29:25)
No. I misspoke on that one. But Satoshi started Bitcoin out of this desire to give people self-sovereignty. And that is the ethos of most of the people, and it's not necessarily nefarious. And a lot of these people care about giving broader financial access and so many people have lost their livelihoods over government policy. And I think the majority of people involved in this sector just care about, first of all, taking advantage of this opportunity that we have. I think, for me, it's a second in a lifetime opportunity next to the internet, but a once in a lifetime opportunity to really make an impact on the world.
Daniel Roberts: (30:24)
Okay, awesome.
Glenn Barber: (30:27)
Can I run this out in 10 seconds or less?
Daniel Roberts: (30:27)
What's that?
Glenn Barber: (30:27)
Can I round it out in 10 seconds or less, hopefully?
Daniel Roberts: (30:29)
Please.
Glenn Barber: (30:29)
One of the biggest misconceptions that I find, and it's not necessarily a misconception, but I think it's just the nascent state of the industry and the investment process. And I'll make a really poor analogy that Jalak alluded to earlier. I think most people look at cryptocurrencies in particular, as sort of this bifurcation, it's either going to zero or it's going to a million something, right?
Daniel Roberts: (30:50)
Yep.
Glenn Barber: (30:50)
It's either the moon or bust. And what people don't really pay enough attention to, or don't know enough about yet, is that it's really about the underlying blockchain protocol, right? The really bad analogy is that it's not. There is value transfer, right? If you think of the blockchain protocol as the new evolution of a company, and you think of the digital currency as the new evolution of the equity, there's no one-to-one correlation in that analogy, and it doesn't hold as much water as we would all like it to, but it's an easier way for people in this room, I think, to get their heads around.
Glenn Barber: (31:23)
And once you start thinking of that, I'll speak frankly, if the blockchain protocol sucks, it's not going to recruit value into the digital currency that it runs on, right? And it's going to go away or become obsolete. And it's going to go the way of pets.com. But we are going to see in five to 10 years, things that resemble Amazon, Facebook, and Tesla from blockchain technology that are going to sit alongside these very same companies. And it's going to be awesome to see, but it's hard to imagine right now.
Daniel Roberts: (31:54)
Wow. Very bullish. Thank you so much to the four of you. I wish we could talk longer. I hope everyone enjoyed. A lot of great knowledge from these four. And we'll talk again soon at some other conference, I hope.