The Winklevoss Twins Discuss Gemini and Facebook

Social network. They were the folks who had the original idea behind Harvard Connection, which later became a predecessor company that theoretically Mark Zuckerberg lifted some of the ideas from and used to launch UH Facebook. We talked about that, We discuss the variety of different opportunities that exist in cryptocurrency, in bitcoin, in Gemini, which is the exchange your vault in exchange they set up. We talked about other venture

capital work they do. It's really a fascinating conversation that's wide ranging and covers a ton of different stuff. If you are at all remotely interested in anything from vcs to start up to crypto, you will find this conversation fascinating. So, with no further ado, my conversation with the Winkelvy. My special guest this week are Cameron and Tyler Winklevos, better known as winkle Vye. Is that plural? Do you guys like that? Or is that just a tired joke you're

sick of? Okay with it? So in case you are wholly unfamiliar with who they are, They most famously worked on the predecessor at Harvard UH to Facebook with Mark Zuckerberg, who they subsequently sued for stealing their intellectual property. That case was settled for tens of millions of dollars. They now run winkle Voss Capital, a VC firm, and have been aggressive investors in crypto, blockchain, bitcoin, etcetera. They also

founded Gemini, a cryptocurrency exchange. Cameron and Tyler winkle Voss, Welcome to Bloomberg. Thanks for having us than you, And by the way, you guys have to just feel free to jump in. I don't know which one of you to look at. You are my first set of twins as interviewees. So it's a little confusing, but but quite intriguing and I think we'll have a little fun with it. So I have to start with the obvious question. You guys must be recognized wherever you go. Is that a headache?

Is it a hindrance? Does it help? How do you how do you deal with your fame from from the whole Facebook debacle? So, you know, we're not recognized, So we've we've always been recognized, well in the sense that like, oh, there's two of you, So there's always been this thing like, wait, are you guys twins? Way before any of all that,

does anyone really ask you if you're twins? I mean, you guys kind of look like identical twins more than you think, And a lot of times they ask if we're identical or like brothers, Um, well brothers, really, I'm not sure if you guys are related. That's just shocking that anyon would say that. But the it kind of depends where we are. We can at least it feels like we can kind of blend in a little bit, but it's it's definitely harder being six four, six, five

six or five twins. That's almost harder to disguise than like, oh, those are the guys from the social network. So it kind of depends where we are. If we're at like a business school event or something, um, you know where people sort of read trade magazines, or a cryptocurrency event, um, but if we're just kind of walking down the street, it doesn't feel like a lot of people necessarily recognize us. But maybe we just don't see it. And and Manhattan

is pretty chill about that for the most part. Is for the most part. I mean, we've definitely been asked to take selfies just because we're twins. Yeah, the person had like no idea who we were and probably figured it out after the fact or whatever. Um so the twin thing gets a lot of eyes for sure, especially because we're you know, not you know, we're older twins. Usually you know, twins sort of separate, live in different cities. We kind of work together where we have similar routines.

So we might be like walking together down the street and people sort of turn around and say, oh, those are two guys that are tall, that look people appreciate the fact that we still get along and we're like in our later thirties. I think they expect to sort of see twins, you know, ten year old twins like hanging out with lollipops and all right, So let's let's move forward from I'm sure you're tired of that question. You must get all the time. So undergraduate Harvard Business

School at Oxford. Was the plan always to go into finance, to be entrepreneurs? What was what was the thinking when you were mapping out your academic and professional careers. I think the idea was I think we thought we would always be entrepreneurs because our dad is an entrepreneur and he has a technology company and has been building software for thirty years. UM. He was a professor of actual science back at Wharton. And then when Offen became an entrepreneur.

So we we grew up UM in a startup tech office environment, and we always wanted to sort of be like that. UM, and then we discovered the sport of rowing, and one thing led to the next, and said, oh, maybe I can be good at this in high school, and then got pretty good, made junior national team, and said maybe we can row in college. And I don't see what happened how you ended up on the Tarles River. Was it from high school rowing? Yeah? I mean that

was Harvard was Harry Parker was this legendary coach. He coached for over fifty season and by the time we were applying to college, he was a guy that you would aspire as a as a high school rower to to row for and then we got to college and said, hey, maybe we can make the varsity and then we did that. We're undefeated national champions in two thousand three, two thousand four, UM, and then we said, hey, maybe we should try our luck at the national team and try the Olympic level.

So it was one of these things that just I kind of call our our sports career a bit of a detour because we didn't grow up in this jock household. My parents played sports, but you know, the house and revolve around that. It actually really revolved around entrepreneurship in business ideas. So rowings sort of started off as this thing that became a fifteen year detour, but I think we always knew we'd get back into startups. So so let's talk about startups. You guys run Winklevoss Capital. What

sort of companies do you invest in? What are you looking for? Uh? In a startup? So we invest in early stage startups with the technology focused really, but we're somewhat agnostic. UM, We've definitely invested in consumer brands and and things that we like. UM. It's a private investment firms, so we kind of make the decisions and call the shots. We don't have outside money UM yet. UM. We could

potentially raise it some later point, but currently it's private. Yeah, and I think that there's just a big focus on UH software technology, although as Cameron said, we've definitely done CpG type stuff. UM. So it is it is really up to us that that is the fun about it, and that has actually been one of the greatest advantages is the agility and the nimbleness because when we saw bitcoin originally, UM, we could invest in it because we called the shots versus a lot of vcs they can

only invest in C corps. So they had structural problems with their UM you know, private offering documents where even if they wanted to invest in bitcoin they could, they had to invest in companies and the partners a lot of them UH saw the opportunity and personally invested in bitcoin, but could invest their funding. It interesting. So sticking with portfolio companies, you had a firm you invested in Love Begins with l was just acquired by Procter and Gamble

are crunch Base says you've already had thirteen exits. Is that more or less accurate? Lucky number thirteen? So thirteen though, but where's the denominator in crunch base thirteen out of how many companies have you guys actually been that successful with already? I think we've invested in over seventy at this point. UM, So that's a good percentage to have about with an exit already. I think at this life cycle, UM,

it's still pretty early. Like we started investing UM about five years ago, and UM, I think most venture capital funds have about a ten year lifespan. So you could argue we're about halfway through, and there's there's a number of great stories that are playing out as we speak, and then there's there's some that you thought were going to play out a little bit longer and get snatched

up UM pretty quickly. I think one a good example as this company Chariot, which is building basically ride sharing and it was taking more of a group model, and so they got these big vans from Ford and had these roots and an app and UM there you know, their equipment supplier was Ford, and Ford eventually was like, oh, let's you know, we should just acquire these guys because

we're not gonna go build and you know, experiment this way. UM. So that exit I think happened maybe a year after our money was wired um, and it was a great return we probably you know, I thought it might have played out over a couple more cities another year or two, but um, it was. It was a great outcome for us.

And we're seeing a lot of that were um. You know, we we invest in brands, they start getting traction and then a large UM consumer company comes and just basically acquires it because they've got all the distribution, but they don't have that innovative thing going on. So I want to come back to bitcoin in a little bit because there's a ton of stuff to go up with you. But I have to ask you something about the Winkle

Voice Capital website. You have on that home page a fascinating painting that I've been in trance with by Jack Crossing on Sixth Avenue. What motivated you to put that on on your home page? Are you on sixth Avenue or what? What was about? And if you've never seen the picture the painting, it's an astronaut and full full um space suit on fire Crossing sixth Avenue. Yeah, I think I think we really like the image because a we're New York based, UM, so it really spoke to

us in that fashion. B it's an astronaut and a lot of these companies, including you know bitcoin and cryptos pushing that frontier right going into space moonshots exactly, and then the flames you know represent I think, uh, the risk inherent with with these entrepreneurs and what they're trying to do and and um, you know people often you know they dare to like think big, but you also have to dare to know that, like you know, you could fail in a big way. Um. It just may

not work. You might put years of your life on the line for no guarantee, no return. Um. And that's just important, you know, being able to take that risk and being comfortable with it and if you fall, getting right back up and going at it again. What what's the Jeff Bezos quote If you're not failing, you're not taking enough risk or something to that effect. That sounds right. Um. You know, we had a rowing coach in high school that said, if you meet all of your goals, you're

not setting them high enough. So there's probably a lot of ways to skin that saying. But I think Cameron makes a really good point, Um, being comfortable with the concept of huge failure. UM is really the essence I think of of entrepreneurship and risk taking. UM. I think that that astronaut picture really embodies that and and sort of the the essence of what it means to be an entrepreneur. And and yeah, it's not for everyone, and

it's uh, it's certainly not an everyday thing. And those are the type of individuals and teams we're looking to back and it's a very specific person UM, and I think that that sort of captures the the kind of astronauts were looking for. Harvard Connection. Was that a fun idea? Was that really going to be a business? What was the thinking when you guys first heat that up? So it's definitely UM a lot of fun thinking about this, but we always thought this could be a great business

as well. There's actually Harvard Connection that was rebranded to Connect to You UM, but the idea was to help students connect UM more easily on campuses. We went to Harvard for undergraduate but in in Boston alone, there's at least fifty schools. There's so many different students, but by junior year, we hadn't really met many people from outside

of your walk of life. You you know, you're in sports team, you're you do, you have your major, and you don't really like connect outside of your bubbles, like life's too busy and geography constraints whatever. So we sort of said, like, let's let our fingers do the walking, and let's put real life social networks online and let's use email addresses to filter people into networks within networks. So if you go to Harvard, you have a Harvard dot E d U email address. Um, you can't get

that unless you're actually a student. Um, the registrar gives you one, and they don't issue you more than once. You can't just give one an X one to a friend. Um. So and the same thing if you go and you work at a company. Let's say you go to work at Golden Sacks, you get a Golden Sacks. Uh, you know email address. I can't get one because I don't work there. And so all of a sudden you can

start building some order online. Um. You know, the predecessors to connect to Facebook where my space uh friends stir. But they were just one network, a home morass of people. You couldn't really find people based on their schools or where they were, and that was really the breakthrough that we that we had that later was uh, you know, pushed into into Facebook. So here's the obligatory social network question. Um, what do you guys think in the movie? Did they

ever consult with you? Were you sort of surprised by how you were depicted? What? What was your experience with that? Like? So, we we liked the movie. I think we're the only people depicted in it that actually went to the premiere. Um. Uh, so you know, I think they did, did you right? Yeah? Um? I think they did a great job of telling a story and three different sides of the story, but not

drawing a specific conclusion. So the conversation really starts as you leave the theater, and based on how they told the story, you can sort of take any any of the sides of the different characters. Um. But I think, you know, there was a ton of information in the public domain, believe it or not, at that point, so they could do a ton of research without even actually talking to the subjects. Um. I think it probably should have won Best Picture. I remember one that year it

was well that was made for the Oscars. Yeah, it was. It was sort of packaged and feel that you know, you're fick like campaign. I think they got the Queen of England to sort of endorse it. They just you know, ran an incredible and it's a movie you can you can watch with your grandparents and younger kids. It's it's feel good, you're kind of rooting for the king even though he's a king. Um, and you know, the social network.

I think a lot of people get to the end of that movie and you sort of feel like, wow, okay, this is this is not a happy world. Um, it's not you know, um, there's you know, necessarily that feeling to it. So it was the original business model of Harvard Connection. Let's spread fake news and affect the presidential campaign?

Or did that come later that that's funny? Um? I mean, so when we were thinking about this idea, we were saying, like, if this works on the Harvard campus, there's no reason it doesn't work on every campus, you know, every like micro network in the world at that time, So as long as you have a single identifying email address, that

can't be fake, right. I mean, so at that point, people were still almost not being themselves online and using avatars, and then this was really the first time where people were saying, hey, I want to be identified as Cameron Winklevoss.

I want people to be able to find me, I think today now because if you go back to like the a LL like a well, the chat rooms, no one was themselves right nobly it wasn't Yeah, and then all of a sudd um there was this flip um sort of cracked the identity problem on the Internet and then everyone's like, wait, I'm gonna be my real self online. And that was really interesting to see that sort of movement. So net net was the social network good for you?

Did it? Was it? Do you to come away from it with a positive experience or did you think of this as well? They kind of you know, told the story and and played a little fast and loose with the truth and and made some people out to be good guys and bad guys. So I think that we've made it good for us. I think ultimately you have to like take these things and try and you know,

make them positive for you. Um, it's a at the end of the day, it's a piece of art and entertainment first and foremost, as opposed to a documentary that's hard hitting, uh, investigative reporting. And you know, we certainly understood that difference, but a lot of people don't. They're like, oh, that's like exactly how things went as opposed to that's sort of a composite storytelling. Um. But yeah, I mean I think overall it was super exciting to sort of

watch it unfold and happen. It was flattering that people cared about our story to some extent. Um, And like Cameron says, it's a lot like it could have been a really bad movie, um, a really bad portrayal. Um, it happened to be like a great movie when we can show our grandkids kind of things. So you can't take yourself or it too seriously. The funny thing is, though, is like a lot of other people like take it more seriously than at least we do. Well, it sounds

like you guys have a healthy attitude about it. We try, um, but people will come up on the street and they'll be like, I'm so piste off or like you know, they're like really exercised about the movie or what happened or this or that. Um, it's like, dude, calm down, Like it's okay, it's just a movie. Well, so let's talk about real life a second. So you're working on Harvard Connection, you hire Zuckerberg to do some coding for you.

At what point did you start to get an inkling, Hey, this guy is uh not really being all that transparent with us. We got our first inkling when we read the Harvard Crimson at the dining room table and we're started. It was like surreal, like you're reading you know, this this alternative reality, and we're like, well, wait a second, maybe there's like another gone on campus with the same

name who's thinking about, you know, the same thing. And it was just a very surreal moment, and that that's when we sort of realized what what had happened, right, so that the Harvard Crimson's the student newspaper um. But then when we obviously were shocked, we're like, what like Mark Zuckerberg launched the Facebook. We're like reading our own

obituary and it's like so super surreal. Uh. Then sort of looking back as we sort of uncovered or thought, like, there was fifty two emails exchange, and it was clear, as we learned later on, that he would say he was doing stuff and then tell his friend like, I'm sandbagging them effectively. So so yeah, it was it was like this. It wasn't like all of a sudden he went his own way and said, see guys like good luck.

It was sort of this methodical, premeditated sandbagging, which was really the basis of of the lawsuit, which was fraud. So you pursued proceeded on two levels. One was the lawsuit, but there was also UM a Harvard Code of Ethics that the claim was, hey, you have an obligation as a student here to maintain the highest levels of ethical standards. How did that play out in real life? It was

depicted in a certain way. It did because in the movie it's a whole discussion with the president of the university and that that turns out to be kind of artistic license. Larry Summers wasn't that interested in the the Ethics handbook, so so that the part is accurate where we go to student office hours and sit in line like everyone else and say, look, you know, the handbook says this a student you know, uh, interacted with us

in a way that's in violation of that UM. And yeah, the truth is the fact is that that the university UM in present Summers just didn't care UM. So that was disappointing. Um. I think you know, as young students, you know, wide eyed, bushytail like entrepreneurs. I think we thought, we naively thought that like the student handbook had some teeth or would sort of um protect us. We we uh, we certainly approached him as a fellow student, not some random stranger. Um. And so that was an eye opener.

And I don't want to say a loss of innocence, but oh gosh, like you know, um, it just felt like we we had a different idea or perception of what actually the reality was. You had expectations of better behavior from a fellow Harvard student. Is that a fair way to sum it up? I think? So when did you guys first get involved in in bitcoin? So we we first got involved in the summer of and we first learned about it on vacation in Abisa. So I gotta think bitcoin is like ten bucks then, is that

about right? I think it was just under ten. It was high single digits um, which which at that point, if you talk to bitcoiners, was like, oh, it's getting really expensive, right it used to be like pennies, you know. Um, So we're on vacation and a guy who we didn't know, but it had mutual friends in common. Came up, introduced himself, said like, basically, have you what have you guys thought?

Have you guys thought about bitcoin digital currency? And we hadn't UM and we had just started winklebos capital Um a few months earlier. We had just been we retired

from rowing. We had rowed for fifteen years. We competed in the two eight Olympics and decided to hang up um our oars, and so we were just starting to get into entrepreneurship UM again basically via angel investing, and so we were totally all ears for new ideas and we stayed in touch and then met some UM bitcoin entrepreneurs in New York as soon as we got back to the States and the rest of sort of history. Did you start by buying bitcoin or start by putting

money into other crypto related UM startups? So that was kind of a debate we had internally, Um, what's a better investment the coin or the company built on top of it. We ended up actually doing both UM. But I think in a lot of these cases for cryptocurrencies, the ultimate bitcoin bat is bitcoin, because Bitcoin's gotta work first before a company that is built on top of

it works. So we we sort of like came to the sequencing that UM buying the currency is it's sort of like buying a piece of the entire Internet or the ecosystem. UM. And so imagine if you could go back in time and buy a piece of the Internet, Like you don't have to bet on Amazon versus pets dot com if you own the Internet, UM, as long as you know, as long as you would be a part of Amazon's growth. I remember when Network Solutions, which

was the registrar for domains that was officially approved. I remember when that stock went crazy, and it was the exact same argument. Hey, you don't have to pick a winner, pick the one company that gets to get a little piece of every company online, just like sort of like bet on the racetrack, not trying to pick the horses. And as long as there's horses racing, you'll be a

part of the pot. So Bitcoin goes pretty vertical, starting in with a couple of big pullbacks, but ultimately towards the end of I want to say it was about nineteen Is that about right? That's about right, And I think that the first sort of big inflection point we saw was in I think it was March of when there's the Cyprus um financial crisis and the government did a bal in so basically they trimmed anybody with deposits

above a hundred thousand euro. They just took it, and right people started, you know, bitcoin sort of hit and mainstream consciousness at that point and people realized, wow, this is like a global asset that um, it's fascinating. It's it's literally a digital gold. I've been calling it libertarian gold because the philosophy of the government shouldn't be able

to do what is so appealing to that right. And one of the things though we also realized as as it sort of entered mainstream consciousness was that, you know, the Cypriots, the ship had sailed for them, right, they weren't going to get into bitcoin, and it already happened. But there's a lot of people who saw that who then said, hey, how do I get into bitcoin? And the only option at that time was a was a site called Mount cox Um, which is mt g o X.

It stands for Magic the Gathering Online Exchange. So prior to being a bitcoin exchange, it was a Magic the Gathering Online exchange for literally magic cards, and they did one of the greatest pivots of all time into bitcoin, and so we actually acquired a lot of our bitcoin on Mount Cox. Thankfully we weren't caught up when it imploded, we had already left the exchange. But through that sort of experience and all the risk, UM, we built our

own cold storage system. We basically private keys, shartered them, cut them in basically into pieces, and then distributed across the country in banks. Um, and some banks like they kind of figured what we were up to, Like they knew we were involved with bitcoins, so they're like, no, like, you can't open up a deposit box. Um, we got

turned away by a number of banks. I would think anyone could walk into any bank and say, Hi, I want to open a safety deposit, you would think, But I think that's kind of how it works, right, because when you open one up, then the bank person leaves and gives you that privacy. They're not really supposed to ask you. Yeah, but apparently it's not you know, contraband why would you're not supposed to put dollars in? Okay?

I think you could potentially argue that we were putting value, But but you know, a shart of a private key in it of itself is not value, it's the quorum of those keys, so it's it was a really interesting kind of experience, and we lived on planes for you know, the better part of a week UM, and we're like, we're really motivated to do this great, but how do we really get people into this system? And how do

we create an on ramp? And that kind of led us into um the gap, which is that in order for this to really work, we've got to have regulated infrastructure that's licensed, compliant, built with like a security first mentality, and that was the genesis of Gemini Are, our online platform that we started building, we launched, and we've been

running in building since since then. UM. And the simple value prop is really by sell and store initially Bitcoin now ethereum z cash, Bitcoin cash, light coin, and we'll be adding more UM. And then once we built that trusted platform, you know we we didn't, we launched mobile app, so you can download the Gemini Mobile app and the Google Play or the Apple um iOS store and literally travel with your crypto at your your tips and you can trade and do whatever you need to do effectively

mobile UM. So that was that's what we've been working on for the better part of the best for or five years. Let's let's talk about wink decks, because I haven't really gotten to that. This is effectively your UM custom index of various cryptocurrencies. Is that a fair way to describe it. So it is a blended price index of UM bitcoin prices UM. So it's just one of the products we've been building over the past couple of years.

When you say blended, is it multiple cryptos or is it just one, Well, there's one for memo correctly, bitcoin and ether. So the risk profiles of exchanges very a lot because every crypto exchange is also custodian, so when you trade somewhere, you've got to commit your capital there. And some exchanges are like mount Cox and some exchanges

are like Gemini they've never had an incident. So UM prices can differ in the industry quite a bit from different exchanges because of the risk profile of how they custody, whether or not you can get Fiat dollars in or

out UM. So the idea of the win de x was to try and create a price because there's a lot of disparate prices UM and understand what that sort of blend is similar to stocks where you have things trading on the New York than AZDAC that you go through all the list of different exchanges, very often you'll have a different price across this. You want to come up with, here's the actual price of bitcoin at this moment.

That's that's correct. Yeah. So the question that that I find intriguing from an institutional perspective is I've heard and read various parties say it's challenging to get liquid and bitcoin for size, meaning hundreds of thousands of dollars. Has that changed? Is it going to change in the future If someone wants to move a million dollars in and out a bitcoin, can you do that quickly? Or were

we not quite there yet? So the when we first got into bitcoin, UM dollars was hard to move into the market and actually acquire UM at a market cap? Would you move the price if you were buying did it in a way you know? You could definitely impact the market um it was a hundred million dollar market cap UM world that that when we first got in UM. I think what people one of the common misconceptions about bitcoin today is the liquidity. There's a lot more than

people think is there. UM you could move a million dollars in and out UM relatively easily UM, and so very very quickly, very quickly, and a lot of times. Because these exchanges are full reserve UM, the depth of the order book looks shallower than it actually is is. But Gemini, for instance, we have UM the world's biggest liquidity providers outside of crypto their customers. So if you can think of a name UM of a market maker on New York Stock Exchange, there's a really good chance

there on Gemini. So we have the same amount of UM liquidity in a sense, the same UH players are there. UM, they just don't show as much because it's full reserve, but it's meaning it's dollar for dollar back up. The prime brokers haven't haven't totally moved into the space yet so UM, but they're they're all sitting there and if they see orders come onto the order book, they're going to move funds and and try and add liquidity and take the other side of that trade, assuming it makes

sense for them. What what do you make of Fidelity investments being so aggressive so early moving into the crypto space. The rest of Wall Street had kind of a let's wait and see what's going to happen fidelity. Maybe I wonder if they missed the E T F boom or something, but they appear to have said, hey, this is the next big thing we want in early. I think it makes a lot of sense and it's a smart move.

Um there. You know, they see the opportunity today. It may not make you know, the business case may not be there today, but it will be there tomorrow. And as these businesses work, um, you know, getting there first is an advantage for sure. Um. I think a lot of Wall Street got really close in seen and we're about to take the plunge. Maybe they set up a trading desk with one individual thinking they would scale that out.

I think Goldman Sachs, you know, built started to build a trading desk, and then it seems to be a little bit on pause, and you know people have backed away. But there are going to be first movers and there's gonna be a lot of value that accrues to them, I think because of that. So so I love the ad campaign that you guys have put together for Gemini because it's so counter to the sort of wild West early days of crypto, So just a full When I was doing my homework, I I saw a couple of things.

The revolution needs rules was one crypto without chaos, which certainly makes sense for people who seem to have lost cash when something implodes or a company loses their their key. It just seems insane that that happens. Money has a future. You guys are trying to take this exchange and make it like a regular mainstream currency exchange. Or am I over selling that? I think that's that's right. I mean, we we enter the space when it was a wild West.

We know what the revolution looks like without rules. Um, it usually ends up with catastrophic failures. UM, people really getting injured, a lot of value being lost. And you know, you would never put your money in an unregulated bank. UM, it would never cross your mind. And yet in crypto, like that's that's the sad reality of the market to some extent. UM. I mean like we were there five years ago, Like I don't miss that. I'm not nostalgic for the early days of of of bitcoin or crypto. Um,

it wasn't as interesting as it is today. The best entrepreneurs weren't in the game. UM, and I think that the you know, the regulation is brought in certainty, it's brought in more money there for investment, therefore better entrepreneurs UM. It's sort of been this incredible great cycle UM. So we lived that wild West firsthand, and it was scary

and a lot of people got burned. And uh we created Gemini in the wake of all of that as a solution to that problem so people could engage with crypto in a way that was felt is you know, safe and compliant as you know, opening a bank account at g P. Morrigan or whatever, UM. And so we we know what that's like and you know, so I think we're pretty informed on on you know, the shortcomings of it. And I think the Money as a Future really plays on this idea that most of the payment

mechanisms that we grew up with UM our decades old. UM. The fed wire system is ancient. UM. Credit cards I think came from the fifties and sixties. And I remember the first days of eBay UM when I ordered some stuff, I did a money order through through the post office. So you go to the post office, you give them a Hunter bucks, they give you like a slip that's basically credit you put an envelope, you mail it off, you get your good and then PayPal came out and

you're like, wow, that's amazing. It just made a life so much easier. But then you realize that it's still sending value through the existing system and protocols. It's really not a global payment system. And then you discover Bitcoin and you're like, oh my god, um, this is truly amazing. You can send any amount of money for very cheap um anywhere in the world pretty much instantaneously. UM. And

and so that fast forward to the past year. We built the Gemini Dollar, which is a stable coin peg to the dollar UM on the Ethereum network, and now with the Gemini mobile app, I can send literally proxies for U S dollars to anybody in the world, um, instantaneously. We've literally brought dollars onto the blockchain. And that's like the future of money. You know. It's kind of like it's so counterintuitive, isn't it. Yeah. I mean it's sort

of like what Skype did for for voice. UM. I remember when I was a kid, long distance calls were a thing. Yeah, Like my mom would be like, like your aunt's calling from California and we lived in Connecticut at the time. It's like expensive as a big thing, and that's what moving money has been for a long time, since the beginning of time. Up your banker. You have to put in these wire instructions. It's like these ancient protocols. Mad you send a wire on Friday, Um, it in

there's a bank holiday on Monday. You know, from New York to London, it's probably getting there on Tuesday. Um, did you put the numbers in incorrectly? It's going to be sitting in limbo for a long time. So that the joke and crypto is you're better off getting um, going to a plane on JFK and flying from New York to London with a bag of cash because they would get there quicker. So crypto, the ideas crypto is basically making money, sending money and value as easy as

sending email. Um. So that's kind of the That was our aha moment um five years ago and it still is today. So you describe it as amazing. A lot of other people in shared that enthusiasm. Did you feel in like bitcoin had blown up into a full on bubble? Like, how are you looking? Having been there? So much earlier. How are you looking at going We were in this at eight dollars, this thing is now a thousand, five thousand, ten thousand. At what point did you say this is

starting to get out of hand? Well, I think we we so seventeen we felt like, okay, we've seen this movie movie before UM, because it was like, I don't know that the twentie bitcoin bubble um where people said, oh, it's out of it's way ahead of itself, it's going to explode and be worth nothing. But each time the excitement gets ahead of itself, it tends to stabilize at

a better floor than it than it was before. So if you look at the instead of looking at the fifty two week highs, look at the fifty two week lows, and each of them are stepping up into the right direction. Now, the way we get there is kind of a wild ride in between. UM. But we've sort of lived through this before, and now people call it a crypto winner, and this is like the third or fourth winner we've been in UM, so we've sort of seen this before.

It's pretty typical of early stage technology. People get over excited, it recorrects, then entrepreneurs come and continue to build great stuff and then it will go again. So we we fully think that there will be another wave, UM, and it should be probably more exciting than the last one. So on paper, in your bitcoin investments scale up to over a billion dollars? Is that fair number? That? That's that's what I read. I don't know how much hyperbole,

isn't that? What is it like when you're saying, I know this is a little crazy, but there it is on paper, it's a billion dollars Or do you just say, we know this is gonna come back down to earth and well let's just ignore it and keep working. I think the latter. I mean we we definitely ignored it and keep working. Um. If you look at the price a year ago, it was close to twenty. If you look at the price to a it's it's a fifth

of that. UM. And yet over the last year, if we think of like what we've achieved as a business as Gemini in terms of building our company, We've launched mobile apps. UM, We've launched a stable coin, We've added three new assets to the platform. Were about two hundred employees strong. Uh, we're shipping two employees really, so this is a not insubstantial company, and you're really thinking about this as a longer term play, not hey, look how

much we're worth, hits a bid and let's go on vacation. Absolutely, I mean we we UM, we're trying. We we say internally that we're building a centurion, a hundred year plus company UM in the valley. People often talk about the unicorn, and that's the company valued at a billion dollars. And our view is that, like, look, let's try and build a sustainable business. If you look at the people in the financial world that that we respect UM, like the State Streets of the world, the Bank of New York,

these are two hundred year old plus institutions. So that's what we're trying to build is longevity, and we think the value, the valuation part will really take care of itself. And so the last year for Gemini has really been remarkable. We've never sort of built so much, built so fast, and done so many things. And when you look at the price UM at a fifth of where it was, it just it kind of is a reminder how it's

it's just one metric and it often lags. It's it can be obviously too too far ahead and too far behind. And and one of the anecdotal things I will say is that UM, as the price was rushing up to twenty thousand, I was getting tons of texts and questions from people like should I buy? Should I buy? And I'm like, I don't know. I mean, it feels like, you know, there's a there's a lot of froth here.

But now I'm getting the questions again because people are seeing it at four thousand and sitting there and it's been there for I think we're going into like thirteen month thirteen of the bear market. People are starting to say it's starting to look like, uh, that's interesting, Yeah, like cheap right. Um, but if you zoom out enough. UM our view, at least with bitcoin is that is a digital gold, and so um that thesis is the qualities that make gold valuable. If you break them down

um scarcity. For instance, bitcoin is actually fixed divisibility, portability, bitcoins like sending email, uh, fungibility. So all of the characteristics that make gold valuable. Bitcoin has those characteristics that either equals them equals gold or better better's gold, so we call it gold. Two point oh and bitcoin's market cap I haven't checked today, but let's say it's a hundred million dollars then golds at seven trillion. If it's a better gold, it's got to get that high as

a market cap. So we think, uh, you know, bitcoin is better at being gold and gold, so therefore, uh it it has a lot of room to appreciate. Blockchain originally was touted as unhackable, and now we're starting to see some articles about small hacks not into the wallets, but to blockchain itself. Is that a genuine issue or these just really little fringe situations that don't undercut the main premise of blockchain. So a lot of the early

hacks were actually company hacks or entrepreneur failures. Uh, they weren't failures of the bitcoin protocol, which has never been hacked. UM. So there are smaller coins um that have had issues because they don't have a large mining community around them. UM. So you know, I think that this stuff is overblown. It makes good good headlines, but I don't think it tells that all the full picture, just like price is not the full picture. So I think you need like

dig deep and do your homework on this stuff. But this space is here to stay. Cryptocurrency is not going away. It's going to power and re architect the future Internet. People talk about Web one point oh two point out. We're on the um beginning of Web three point out, so it's something you should totally learn more about and take seriously. Can you guys stick around? I have a bunch more questions as we have been speaking to Cameron and Tyler Winklevoss, founders of Gemini, a crypto exchange, as

well as Harvard Connection and winkle Voss Capital. If you enjoyed this conversation, be sure and come back for the podcast Actors, where we keep the type rolling and continue discussing all things crypto. We love your comments, feedback, end suggestions right to us at m IB podcast at Bloomberg dot net. Check out my daily column on Bloomberg dot com slash Opinion. Follow me on Twitter at Rid Halts. I'm Battery Rihults. You're listening to Masters in Business on

Bloomberg Radio. Welcome to the podcast, guys. Thank you so much for doing this. I've been really looking forward to chatting with you, and you have not disappointed. There are so many questions I did not get to um, and they'll have to wait for another time because I have to ask you my favorite questions that we ask all of our guests. UM. These are always in interesting and revealing of people's um history and background and personality. So

let me jump right into this. Tell us what is the makeyearin model of the first car you guys owned? I think we shared a an SGV, a land Rover. I think that's right, first car, and you guys will split We split it down the middle. You guys were living in Grantwich, Is that right? So you had a really interesting up upbringing and I wanted to to ask you about that, but well, if we have time, we'll we'll circle back. So tell us the most important thing

people don't know about the Winklevoss twins. Um, So Tyler's right handed Cameron's left handed? Is really is that true? That's it? Is that common amongst twins? Or is that relatively rare? So? I think that it's in identical twins are mirror image. UM, and I think it's when the egg splits later. Right, That's quite fascinating. I had no no idea about that. UM. Who are some of your early mentors? You mentioned your dad who affected your career

and your entrepreneurial desires. I think for sure. Parents, UM, I would say early coaches were important. UM high school rowing coach James Megan, this irishman who really helped us explain the sport to us and help us fall in love with it, UM and sort of believe in ourselves that we could achieve these things as kids in high school. UM. So I'd say those are those are big ones early on that really helped, um, you know, affect the trajectory

of of our later years. What what about you guys as venture capitalists and investors, who has influenced the way you think about that work and the way you put money at risk? I think, well, our father is an entrepreneur, so I think we through osmosis sort of being in

that that household. Um. He worked with computers back in the sixties, prior to even monitors, when it was like punch card and is using a univact that the computer I don't think it would even fit in in this floor of the studio was probably three times the size of the studio. So we'd already always been around sort of technology and ideas and taking risks. And then I think, you know, I believe or not the sport of rowing.

I feel like it's informed so much of how we think, UM, build building teams, UM, you know, day and day out, just consistency. UM. You know, it was a fifteen year journey for us. UM. When we stepped in the boat house, I don't think we thought we would be on you know, Olympians, But fifteen years later, UM, we were. And it was just a lot of work for you know, day and

day out. UM. And I think that's most of you know, entrepreneurship. Uh. It's easy to look at the big numbers and the I p o s. But if you look at most of these companies, they've been at it for uh well over a decade and just you know, plugging away. Quite interesting. Tell us about some of your favorite books, be they investing or general interest fiction non fiction? What do you guys like to read? So? I think Zero to one is a great quick read. It's ter Teel's book on investing.

There's a lot of counterintuitive ideas and examples in there. UM. It's I think it's something like eighty pages. It's a really quick, straightforward read. UM. And then it really captures the art of of startups and entrepreneurship. It's it's a really good quick way to understand how that world works, because you don't learn it in a classroom. Usually, you don't learn it in a liberal arts education. Uh certainly, usually not in high school. So I think that's a

quick way to kind of get up on it. What else, what else do you guys read? So? I think snow Crash by Neil Stevenson is phenomenal. UM. I think it was written in the eighties and he UM pretty much like UM depicts virtual reality UM in an amazing way. Uh. So that's a great, great book and just becoming more and more relevant by by the day. And then I

think Kryptonomicon, UM, I knew you're gonna go there. Yeah, also by Stevenson by Stevenson, and it basically you know bitcoin is you're reading and you're like, this is bitcoin. You know how incredible he this guy? He predicts VR and predicts UM bitcoin. So if people are decades in advance, not even like right before ahead like UM. And so if you've read Ready Player one, it's sort of like

the newer version of snow Crash UM. But those are really fun, incredible, there's so much more than just like, oh he predicts bitcoin and VR. But also I think you're going to see this, um conversions of the two worlds of VR gaming and crypto and payments. UM, that's going to be fascinating to see play out. So these are great books to kind of go back to where it all started. Quite interesting. Tell us about a time you failed and what you learned from the experience. It's

a great question. I mean, I think a lot of times when people think of failure, they think of some epic, you know, decision or thing that went wrong. And I think, um, certainly, you know, if you're in the game long enough, you're going to have those. UM. I think we sort of

learned early on how to pick your partners wisely. UM. But I think you know, in the sport of rowing, uh, a lot of times you go out and you have a bad practice, UM, and you feel pretty bad about the performance, but um, it only lasted long until the next practice, and so you build this this you sort of live with failure in a way. UM. And most of you know, the Olympians and gold medalists that we

know lost a lot more races than they won. So you really learned to embrace failure, to process it, um, and then just keep moving on and realize that you know, as you push forward, it's just going to be part of that that experience. UM. And I think the people who stay in the game, whether it's entrepreneurs or investors through the long haul like they do well, it's the people that that sort of fail or or you know, leave after a year or two. Um, they kind of

miss out on on all the other stuff. What do you guys do for fun? M hmm, that's a good question. Um, everybody wants to wants to start a start up, and then um, when you get any you realize how much work it is. Uh, there's not too much time for fun. But if there's downtime. We've been doing some skiing lately. Uh, really enjoy getting out in the mountain. The energy workouts. Very social, it's fun. Um. Love reading, love watching movies. Um, you know, simple things that just are sort of relaxing,

seeing friends. Um. But but yeah, when you when you start a company, it it definitely, Um, it's all consuming. That the thing I would equate it to most And I don't have kids, but I imagine it's like having a family having kids. You don't just you know, check in from nine to five it's a seven thing that you live with, and it's all encompassing. There's really it blurs between you know, work time and non work time.

It's sort of like always there. I think that's a generational thing because the current generation or helicopter parents go back thirty or forty years and the latch key generation the parents would occasionally check in. But your point is well made. So within crypto and or venture capital, what are you most excited about? What do you think is really the most interesting disruptive thing that's going to come out of those spaces. So I think crypto is gonna

usher in web three point oh. Right now, we have basically an Internet that's built up of a few centralized services, and I think we're gonna see sort of the decentralization of many of these services UM and and users are going to realize that they should really be getting compensated for their their content. Right now, we were all part of these social networks and we are the product, and we're creating tons of content and not getting anything for

it UM. So I think that there's going to be a huge shift UM in that direction, and cryptocurrency is going to be part of that solution. And ushering in the web. Three point oh. And then what we're seeing is a lot of you know, it's building a brand these days, is it's really fasting because you can just go direct to consumer. You don't need the fixed costs of a brick and mortar. Um. We're in one company called Dirty Lemon where literally you just order it through text.

It's SMS. It's super simple, and they have a store uh downtown that's not even manned by any um individuals. You you go by, there's a there's a camera, you you put in your order and you just take take what you want. Um, it's truly automated. Um. And then there's lots of other brands that I think are gonna you know, innovate and then get scooped up by larger incumbents. So um, it's a it's a really interesting time to

be building brands and things like that. If a millennial or a college student came up to you and said, I'm interested in filling the blank startups bench capital crypto, uh sort of advice would you give them? So? I think that the uh, the big piece of advice I would say is that whatever you choose to do, you should definitely look at crypto, but I feel like crypto that's fine, um, but you should be looking at the

minimum of a four year cycle. Um. We see in our shop at Gemini that it takes about six months for an engineer to get up to speed and be truly productive at that optimal level, and then you know, you it takes another six months to just sort of learn and and and understand how the company were. Where the cold brew is all those things. You gotta know

where the coffee is, right, um. And I think a lot of times people they're the horizon that the patients isn't there, um, and they're looking to just sort of switch in a lot of like quickly. And when we look at like our you know, like historically we did. I mean, we were in the sport of rowing for fifteen years and it wasn't until the eleventh year where we thought, you know, hey, maybe we could potentially make

the Olympics. Um. And it took you know, it wasn't it wasn't months, it wasn't it was over a decade. So I think, you know, what we've learned is like patients is huge. Um. We've only been in cryptocurrency, and I say, only for five years. Most people would think that's a lifetime, but it's sort of like dog years cryptocurrency.

So yeah, um, but like how long when when this is mid two thousand's right, so it's not like there's a fifty years totally and and a lot of people they look at the crypto winner right now and they say, wow, this is like so bad. And honestly, most of the time we've been in it, there's been winter Gemini. The first two years of Gemini. Uh, people weren't thinking about crypto. They didn't really you know, weren't paying attention, and all

of a sudden boom, they're paying attention. But I think patients overall, if that's the t l d R of my comment, I mean, there's such a dearth of engineers, and then if you go to security engineers or like infrastructure engineers, it's even harder to find them. So if you want job security, like become an engineer and learn

how to talk to machines. Um. But I also think the with that movement um being able to think creatively, being like artistic and following things, that's sort of um foster that in you is going to be super important because you're gonna have AI, You're gonna have um machines and all this automation. Um, but machines aren't good at being creative. Humans are so really tapping into the creativity

of of being human in the human spirit. Um. And understanding how to like how to intersect with machines is going to be like paramount to navigating the future. And our final question, what do you know about the world of investing, the adventure capital, crypto or what have you that you wish you knew ten fifteen years ago when you were first getting your legs under you. Hm hmm, that's a good question. Um, well I always wish I had a crystal ball. Um, I think you know. But

what Cameron said before is patients is so big. Um. Rome wasn't built in a day startups when we built in the day. We we talk about like, um, the timelines of building a company in the nineteen thirties. Uh, we're so much more longer long than the than the ones today. Um. But whether you're investing like you can have a long term vision, but if you don't have the patience or the conviction to wait it out, and if you're just quartered a quarter or day to day. Um,

then you can get pinched. Um. So you know, the markets are are rational and efficient in the long run, but in the short run they're not. And the same thing as an athlete. You're just not going to make become a different athlete like overnight. And so I think the wisdom the common sense of sort of patients get rich slowly is another thing I like to think about. Um, all of that, you know, true value type investor mentality. Um, you know, I think that's super super important. Um, it's

easy to forget. But you know there's also I love to saying, if you want it bad, you get it bad. Don't like I think the Navy seals don't say like, don't run to your death. Um. I think patients and just having a long a long term long ball type mentality is pretty much any everything in investing, entrepreneurship and life quite quite fascinating. We have been speaking with Cameron and Tyler Winklevoss of Winklevoss Capital and Gemini a crypto exchange.

If you enjoy this conversation, well look up an intran down an inch on Apple, iTunes, Stitcher, Overcast, Bloomberg dot com, wherever your final podcasts are sold, and you can see any of the other two hundred and fifty or so such conversations we've had in the past. We love your comments, feedback and suggestions right to us at m IB podcast at Bloomberg dot net. I would be remiss if I did not thank the crack staff that helps us put

together these conversations each week. Medina Parwana is my producer. Taylor Riggs is our booker slash producer. Attica val Bron is our project manager. Michael bat Nick is our head of research. I'm Barry Ritolts. You've been listening to Masters in Business on Bloomberg Radio.