Taking The Power Back From The Banks

Now you've probably heard of Alex. He is going around talking and speaking everywhere. He's a big advocate of cryptocurrencies. He was original creator of void voice over Internet and now he is coining the term money over Internet. And so he really talks about what's going on with the banks, how they're taking advantage of us, why this is keeping people broke or poor, and what we can do about it.

We talked about how cryptos changing this, the decentralization nature, and how the average person can get back with the banks have been taking them for a long time. It's a really good conversation. It's one that I've been wanting to have a long time. I really really looked forward to talking to Alex, and I think you're gonna enjoy it too, So let's go ahead and jump right in. All right, Welcome to another episode of the Market Disruptors podcast.

I am continuing to see the series here on Decentralized Finance. You guys really want to know more about Celsius, and so I am sitting down with Alec Maschinski from Celsius right now. We are at the Bitcoin two thousand nineteen conference in San Francisco. Um, super honor that you would take the time to sit down with me, so welcome to the podcast. Sure much rather be riding those bikes in Baham. And but you know, next sense of you,

we're doing it down to the peak. You know, we'll do that with So for those of you guys, we were talking before the show and and he's a dirt by guy on the dirt By guy, and we're both really like off roading and adventure bikes and so, um, that's really cool. It's kind of a really niche, you know kind of and so to find someone else that shares that passion is pretty cool. So I'd love to take you down on a trip and we can talk more about it. Um. And so we could we could

go on and on for days about that. But let's let's get right into it. So, UM, I started talking about decentralized finance, which is which is an amazing space. UM. You know, decentralizing finance bringing kind of freedom and quality back. UM, the way that cryptocurrencies work. UM, we have the ability to holdle because it's it's a new technology that's gaining

you know, it's growing super fast. Obviously, bitcoins kind of mooning again right now, and I know, you know a lot of people don't want to sell and that's a problem, um, and you have come up with a way to kind of help people do that. Before we dig into that, maybe why don't you just go back a little bit I should have done this is tell us a little bit about what you're doing in the space and kind of how you got here before we jump into Yeah.

So so first, you know, I think the context is very important because people it's more for people who understand, yeah, what I've done before and why it's relevant. So. So, I'm an immigrant that came to this country thirty years ago, and uh, I grew up in I was born in in communism in Russia and grew up in socialism in Israel. And came to America, and this was like just a dream come true. Right, Like, you can talk about all the ideas you want in other countries and no one

is really gonna help you make them happen. And here you show up and you're like, I have this idea. You know, we're gonna put voice on the internet, you know, and and and people backed me in ours two fifty million dollars took the company public. You know, now Voice of I P s used by the majority of the people on the planet right road the original protocols, the patents build the first gateways. So that was just an

amazing experience. I did that in my twenties, right, and and uh so very rarely you can do that kind of revolution twice, right, like going from yeah, going from um something that the phone companies who were the toll collectors, which used to charge us three dollars a minute, to something that is free, right, I mean that really changed the lives of people. They can talk to their friends, they can reach out to their family anytime they want.

So now we're kind of moving from Voice of I P two money over and so October, I mean I filed the patents on my birthday October five. So I think you had an interesting background because one you're not from original from the United States, and so becaunderstand the issues that most people face. Right, So because of that, you probably saw your family having to do a lot of long distance calling, and long distance calling is very

expensive at that time. It's also recognizing that like back then, it was very difficult to figure out which network is going to win. The phone company's bet on a T M ethernet was a big thing. Frame really was a big thing. So betting on T C P I P was actually like looked like crazy idea. Yeah, that was not the norm like now all saying Internet Internet, but the Internet was an application on the phone network when you dial up with your motive. I remember the motive.

So to think that that would be somehow replaced with something that's available seven and it's fast enough to do conferdence calls, like my kids have eight of their friends in real time right all over the world talking at the same time. So that was just a bridge too far. And and and that is exactly the analogy for crypto today because when you look at these powerful banks and you're seeing it how how little they give us right for the hard earned money that we earned. For me,

it's just something that is not just irritating. I have to do something about it. I can't just sit by and like in my presentation there, I said, you know, I asked the crowd, I said, what are you doing about it? You know? You know so so so. I think it's important that people understand that that all of us make that decision every day, all of us choose to the positive money in the bank or put it somewhere else where it will actually do good, it will act in our best interest. Yeah, I want to dig

into that before I do. I love this because you have such an interesting background. I'm just curious. So having started in like you said, and at the time, the protocol wasn't clear, so you were kind of taking a gamble. I wrote a new protocol or you wrote a new protocol. And at the time, there was a lot of people that thought it was never gonna work, and the internet was and it was stupid. I started internet business in two thousand one, an e commerce business. Earlier, people told

me no one will ever find anything. Brands refused to sell me products, no one will ever bu anything online. It's ridiculous. I can only imagine a But so I'm curious, and I'm sure you're hearing kind of the same things today, right, A lot of the tractors say it's a scam, it's never gonna work. How do you, um, how do you see that future? How did you know it was gonna work? How did you manage to stay strong and believe in yourself when everybody was telling you wrong? So, first look,

I was kept in the beginning myself, right. I mean it's not like when I read Satoshia's paper, but the Internet, Right, with the Internet, you found a way to believe in yourself when other people were telling you wrong. Well, when you're in your twenties, you don't know any better. You know, like you think you're the smartest guy, and you think you have all the answers. And I was lucky to be right right, But but you know I was plenty

time wrong in other ventures. It's not like, you know, like we we handed out of the park every time. But but they choose more about the focus was on disruption, The focus was on empowerment of the people. The focus wasn't doing good. I didn't do it for the money.

I didn't like say, oh, where can I make the most money, Let's do voice of ip R. The idea was, here is a new set of rails, right that that bypasses the phone company and soon enough it's going to be powerful enough to take all of that business away from the phone companies. And today and lose his money on international voice because like basically all their customers left them and they're all using Skype and What's Up and

Vibra and all kind of other apps. All right, So the banks are exactly the same thing about people don't understand. They look at me and the same. But the banks are so powerful and like, the banks are not powerful at all. The only reason their proful is because you give them your money for free every day. So let's talk about that. So you you founded a huge problem with international calling, and you fix that, and today you

see another huge problem. And then in between I did a few other than seven startups in between, right, raised a billion dollars and three billion in exits. I I should be retired right now. I just don't have enough switch. Because you have so much energy I can. I do not have enough switch. I'm like this seven days a week because you see problems and you want to solve them and and that's and and I think when you're

doing that, you have energy, right, So that's good. But so now there's another big problem that we have today. After I fixed that car, so yeah, yeah, there's a whole cars out here we are looking at. So. Um, we have a problem with the financial system today, which we're not going to get into all of that. I talked about it all the time, but one of the big problems is in the way to find its works and um, which no one understands really and most people, unfortunately,

they don't teach us in school. They don't teach us in high school. You could graduate in PhD. In economics and you still would not know how to make money. Right. So if you think of how many people actually know how to really earn millions of billions of dollars, it's

very very few. I mean, that's why we celebrate war in Buffett and the guys that Ryan Goldman Sacks and people like that, because they can extract billions of dollars of profit out of something that for us we barely make a salary, right like and and we were like struggling to finish our month and these guys make billions and profits every year. So so that talent, the talent

of earning that return is a very rare talent. And and again still celebrating the scientists and the and our real heroes, we celebrated people who are making money, who who basically aggregate wealth. Right, So so it's just all upside down. So I try to create a new system in which you don't have to know anything, right, I mean, the whole idea about Salesa's network is like cost you become a member of course school, You take a giant card, you walk in, and everything in the warehouse is at

the lowest price, the best quality. You just fill the card as fast as possible, and you check out. So that's that's experience, the financial experience people should have with the curated service that acts in your best interests. Right, that's what we don't have. We don't have any institution acting in our best inch just not the brokers, not the insurance guys, not the banks, no one. So like a fidelity or like no one, none of them is

acting in your best interests. I'll give you a simple example. Right, you think that fidelity charges you, that's a steel, right, it's nothing. Let me give you an example. You bought let's say Tesla stock, right, and you're deposited with Fidelity, and they charge you four the trade. They make thirty percent a year, lending your stock to short sellers thirty percent years. So if you give them ten thousand dollars, they made three thousand dollars a year for you just

sitting there holding your stock in the Fidelity account. So the same way people make money on your Bitcoin or your Ether or your Dash. Right, The simplest example is Dash because Dash actually earns you without doing anything, but if you take exactly. But most people don't have eighty thousand dollars of Dash, so they bought ten thousand or five thousand, they hold it on Binance or somewhere else. Bindance steaks it, Bindance earn seven percent. They just don't

give it to you. So all Celsius did it, said give us your Dash, we will immediately every week we will send you more Dash to your account, will stake it for you, no fees, no charges, just we're gonna do it for you. And people go like, there must be some hind in agenda. Why are you doing it? Gosh that's that's because there's no education in the way

that exact works. And so you talk about there's no way for the average person to know what these rich rich how they make their money, but there is, and so there's clues, right, Warren Buffett tells us, um, if you don't learn to make money while you sleep, you'll work till the day that you die. Yes, And so it's important for us. And working is a good thing. Working is a good thing. But don't forced to work, especially doing something you hate, exactly. And so we want,

we want our money to be worked. We work hard for our money. Our money should be loving, hardy, and warm. Buffet says, we need to put to work. And that's essentially what you're talking about, right, putting our money to work. And most people unfortunately, again, half of Americans don't have four hundred dollars in case of emergency. I mean that of Americans the bottom of the same wealth as the top one percent. So I'm I'm part of that one percent.

I'm not sitting here telling you all I'm poor. I'm fighting for the poor. No, I'm rich, but I'm fighting fighting for you giving the poor tools exactly, I'm not giving you the fish, I'm teaching you how to fish. So UM, what you're doing is you're allowing someone to use their cryptocurrency and uh and and use the value that's there without having to sell it, without them even knowing how to do it, without even knowing how. And maybe maybe we could say it's giving them passive income,

right because they're passively income. There's other ways to make passive And I couldn't show you a dividend pain stock or something like that. UM. Bonds obviously have yield and things like that. UM and in those types of situations, UM, and when I do a bond, right, they have like triple A rated bonds or junk bonds and they pay

different yields. Would loan in my crypto Wolby be similar to that bond, so a bond and the yields and bonds have been going down drastically, right, So, so what people have to understand is that like, for example, when I came to this country thirty years ago, I could take my dollars departlem in city bank and earn seven percent without doing anything right, try to earn seven percent on your money today right with low risks. So the

banks I believe on average pay about zero. Yes, yes, so so so like JP Morgan, for example, has fourteen trillion in assets. Half of its seven trillion, they don't pay any interest whatsoever. And that's about a hundred million Americans giving them the money and getting nothing because they're too lazy to move the money from the checking accounts of the savings account Because they're saying I have a thousand dollars exactly, i'ms a hundred million, seven trillion dollars

in deposits. Right, So, so JP Morgan makes thirty billion a year in profit just from that, right they make all the banks together made thirty four billion in fees from overdraft fees. Yeah. I mean that's taking money from the people that cannot finish the month, taking thirty dollars and then the person has to go and get a day loan because they can't pay their just it's all upside down. Why because they prey on the poor. There's just no other way to say it. Right, So again,

why isn't there anyone acting in your best interests? Cost cocts in your best interests. Amazon acts in your best interest? Right? I can say that with the stray face. I know business wakes up every day and he's trying to do everything for his customers. Why isn't anyone doing it in their financial services? Well because they're they're not they're they're

interests are not aligned with our interests. Right, And the number of banks that exist of was shrunk down to four or five, right, So so there's no reason there's no competition. Right, it's impossible since dog for it's impossible to open a your breath bank. You if you get a license, you have to be complying to eighty thou pages of regulation. So the rules that we're supposed to protect us are actually preventing competition from coming in. And then when these banks take too much risk, we have

to bail them out with taxpayers. So all we're trying to do and again, our job is not Celsius is not here to play with your coins or create manipulation or anything like that. Our mission, we have only one mission to earn return on your assets. Your asset. You can go all the way crazy and take really risky assets, right, we have risky coins in our wallet, or you can go super safe and take stable coins. We're not we're not telling you which one you have to do your homework,

and you have to decide. And I recommend to people say what should I do? And I'm like half of you asked. You're being stable coins, right, We pay eight point one percent on stable coins right now, Like you take your dollars, you convert them into stable coin. People don't know what that means. Let me speak in English. You take your dollars, you buy t U s D or g U s D or U s DC. Right, these are issued by by True us D or by

Gemini or ber Circle. These are reputable companies, their trust companies, the fiduciaries. So you know the dollar is actually sitting in that bank account and your token represents a dollar. And now you can deposit the token, earn eight point one percent at any time, twenty four hours a day. You can enjoy it and get your dollars back. For people to earn April one percent, that's a life changing event,

right it can. We have a guy here who's paying his mortgage and his kids college just from the interest is earning from Celsius, right so, so, and that's what we're saying to people. Look, just create a nest egg that like you said, instead of you're working for the money the markets is wanting, working for you. Then take another put in bitcoin. Then take another put in I have other coins right now, you have a diversified portfolio. It's still yielding seven or eight percent, but you have

the upside of bitcoin. You may have the downside too, but at least you have some exposure. But you're yielding while you're earning. Right, So the people are deposited with us during this downturn in the market, they were paid in bitcoin. That bitcoin is now worth three times as much. They didn't earn seven percent. They earn Oh so you pay that we pay bitcoin? Yes, Oh wow. So that's

a big difference exact crisis going. So unless you only when you feel that when you open your wallet and you go, wait a second, I actually made five thousand dollars. I only put five thousand. If I put ten bitcoin in, I would get Yes, we only paying bitcoin. We're not allowed to pay in dollars because we're not a bank. We're not allowed to take dollars. We're not allowed to pay in dollars. So you have you so going back

to this. So again, so there's there's options for people if they want to make interest on their money, like did it in paying stocks or bonds or whatever, which are all pegged in dollars, which are all pegged in and what there's an unseen force that is actually squeezing your money, right inflation. It's three percently your money every year, So three and am or more exactly, they tell you,

we know it's a lot exactly. So so if you're only earning two percent, right, the average bond right now pays two percent, right government, but so you're actually losing one and a half to two percent a year. You think you're earning, but you're actually losing money. So you have to earn enough to at least exactly exactly. So for you to earn eight percent like we're paying unstable coins, you have to take a lot of risk, right, And

that's what we're telling people. Look look at the risk you have to take to earn that in the stock market or somewhere else. And look at the risk we have. We have all of our loans asset backed. We only against I want to get into the risk. That's definitely what we want to dip into. But I want to just talk about this for a second. So that's on on usd The real where the real huge benefit is in is in the bitcoin, right or other cryptocurrencies, because

I mean bitcoin's up over two like this year. We're also down before before, But it depends on what time period you look at it. But for the most part, most people in bitcoinn believe it's going to continue going up. I mean, I think over the next several years get into twenty thousand and fifty thousand is realistic. At least I'm hopeful that it is. And so I don't want

to sell, and most people don't want to sell. However, that money is locked up, and if I could earn at least earn interest on top of what I'm earning, that's a huge opportunity. Um, And so that's part of it. But you also offer another type of product where I can borrow against that as well, right, And so then I could take that bitcoin. I have ten thousand in bitcoin, and I could borrow five thousand out and I could do what I want with that five thousand, including leveraging

back in or buying a piece of real estate or whatever. Right, Um, what do you think are the different types of people that are interested in that? So the richest people I know, and I'm I'm you know, smoothing around within the Hampton's or in on Wall Street with with these people. Right, I can tell you, including our president, right, they make all their money because they don't pay any taxes legally. Right. So Donald Trump famously says, I followed all the rules.

I borrowed dollars against my real estate. Right. The interest is tax deductible. In the meantime, I don't have any tax bill because I didn't sell anything. Same thing with bitcoin. If you have bitcoin and it appreciates, right, Let's say you wanted a two thousand, and now it's a ten thousand if you sell it, so you could you have to pay your mortgage, you have to pay your kids college, You have to pay almost half of that to the government if you live in California, in New York, anywhere else.

So exactly, so so you can avoid that, you can just borrow against the asset and then you don't have to pay any taxes. You're deferring the taxes for later on, just like Donald Trump does with his real estate, which is anything, and it's a legal So we're telling people, look, all these tricks that the rich people do are available to all of us, and another trick that the rich due that I've talked about is then taking those dollars

and putting them into another job. So now one dollar can be doing two jobs and leverage, leverage and attacks deductible. So I could put but you have to be smart about it. Advanced strategy right and and and most people probably to watch the show say it too complicated for me. I don't know how to do it. So Celsias saying, look, you don't need to be a genius. We have like a hundred fifty different strategies that we automatically deployed to generate this yield. You don't have to choose them. You

don't have to understand them. You we we have one bucket of BTC. We don't treat the guy with a ten million dollar and the guy with a ten dollars differently. You're both in the same bucket. It's a PROADA allocation. Whatever we earn goes PROADA to all the people participating. Now go to your bank and tell them, hey, I have a thousand dollar deposit. I wanted the same treat to it. Like Donald Trump, You're not gonna get it right. So again, because they make all their money on the poor.

They cannot charge the which people any any real feest. I don't pay any fees from banks. You know, I'm too rich for them to charge me any fees. Right, they know I'm gonna leave in a minute if they charge me anything. So all we've done in Celsius is we said no feat to anyone. We have never charged the fee. All of our earnings, whatever we earned, eighty percent goes to our depositors. That's what no one has

done in the history of mankind. No one was crazy enough to take real earnings that they can earn on other people's money and give it to the depositor. Who would do such? Who would do such a stupid thing? Who would do that? So when we started this, people are like, Oh, it's a scam, it's not for real.

Then they started looking and we you know, we've we've unfortunately in this industry, we've seen a bunch of we've seen a bit connect they're going to pay one percent today or whatever they're gonna we're promising eight percent a year. I know, I get it. But we have three million in assets, We've done two billion in loans. I mean, there's some banks here in California that haven't done that this year. So we are moving very very quickly. Why because when people look at this, they do a little

bit of homework on Alex Muschinsky. They're like, Yeah, this guy doesn't need to work. Yeah, why is it doing this? Maybe he is really maybe it really cares about us, So let's talk about that. So everything has risk. Doing something has risk. Doing nothing has us. Right, we all have risk, and we we we have to understand what those risks are. Um, if I if I leave my money under the mattress, there's risk that it's losing value, you get stolen if I put in the bank. And

if everything has risk, we have to understand that. And it's just important to assess those risks. And so you said, um, the average person should do a little homework. So, um, you're not the only one doing this thing. But maybe we were the first one. You were the first one, but maybe you could tell people that we forced the other guys to do it. Right, So we forced the block fives and the sold and the next so and all these other people who paid nothing, they took all

your coins and paid you nothing. Right, we showed up. You made them up their game a little. Let me remind everybody, right, last year, just a year ago, you wanted to do a margin loan against your bitcoin. You paid eight we paid, We charged five to nine. So we cut it by two thirds. Everybody, everybody hates us. Why why all these other companies hate us? Because we took this game that that basically they used to charge like a credit card, and we said, no, it's an

asset back loan. You give me a bitcoin, I'm giving your dollars at fifty cents on the dollar. I shouldn't be charging you double digits. I should be charging a single digit, just like if you bore it against your home you would be paying. But people don't understand that. It's the same thing. They don't understand that. So what's the So we we broke the game and we said, not just that we're gonna charge you five percent, We're

gonna pay you eight percent on your deposit. If you don't take a loan, you understand it's it's it's that's what it is. So so that because again for us, it's for me, success is a hundred million users. For the other guy's success is stealing as much as possible from your pod is a completely different game exactly. But but that's the question is what is your motive and why why are you doing this A you're doing it for the money? Are you doing it for profit? You know?

So what I want I have to find out is what is the counterparty risk that we have as a risk As as an investor, I always wig risk and reward. Great question. Typically I want more upside the downside, and it's here it seems like maybe I'm risking a hundred percent. You're holding all my coins risking to make eight. So

let's take a few examples. So it's a great question, and and it's very important that people spend time not just listening to me or you, but actually doing their own home word because they need to feel comfortable that they're taking their precious assets and they're putting them in a safe place. So, first of all, we use bidgo as a custodian. Right. It's one of the best custodians, a hundred million insurance from from Lloyd's. It's the same

custodian that exchanges like Cracking and other people use. You put your coins and cracking they go to bid go, right, you put your coins and they have insurance. So if there was some sort of a hack or something. Have insurance that so so, but there's a big difference. For example, if you take that dash coin, we actually don't land it out. All we do is take it so it sits in bid go and you earn seven said, that's

the lowest risk acid you can actually do. Now. Dash can move up and down value but lose value, but you will earn that yield. We don't even lend it out. It never leaves bidgo. Okay, so it's ensured, it's yielding, it's doing everything it's supposed to do. You pay nothing. If you want to open a bitgo account, it's three thousand dollars a month minimum. We're giving you that for free. Right, so people have to understand that, Wow, okay, I got big for free. I got the insurance for free, I

got steaking for free, and I'm staking. It's not easy for those at homes, it's not easy. You're doing all the work of exactly. That's definitely exactly. And you needed minimum of eighty thou dollars for each note. So if you gave me five hundred dollars worth of Dash, I'm still paying you as if you had eight and you created your own staking note, then you check the computer every day. We're doing all that for free. Why are we doing that for free? Right? People go like, no,

it's too good to be true. Right, So we're doing it because we want to convince you that we're at think in your best interests. Because we make enough money on your bitcoin and enough money on your dollar loans and everything else that we can give this away, you know, So then you have other assets. For example, if you deposit bitcoin with us, we don't earn money from bitcoinsidering in bitco, right, so we have to lend it out. Lend it out means what we go to exchanges, we

go to hedge funds. We don't lend to individuals. We collect coins from individuals. We only lend to institutions. Right, So, if you remove your coins from binance and you put them with us, guess what not bynus does not have enough coins. They're like, hey, we need to do market making, we need to do shorting, we need to do front running of all of our customers. We need more coins. Can you lend us coins all the ship that they do. They do it with your coins, which you gave them

for free. When you remove the coins. Then they have to pay eight nine for borrowing from us. So we collect it all from the exchanges and the hedge funds instead of them collecting tolls from you. So now you're loaning these coins out, and I don't know who that's going to. I would imagine they're all being commingled, right, And so there's a big btc um you know, omnibus account, meaning one giant account from there we lent to all

the parties. And so you're lending into these exchanges or whoever institutions, and I don't have any control over that or what their credit worthiness or whatever. And so let's just say any of all something default. And as a matter of fact, a couple weeks Polonius had a problem and and violence are the problem. They stole forty eight

million dollars from violence there just a few weeks ago. Yes, just the other day Polonias had a problem where one of their derivative clam or when we use poloniae, the socialize the loss right, everyone had to take a sixteen percent haircut. That's correct, and and so then how does that affect myint None of our customers got affected, Okay, And Celsius covered that, so we we can't get into the details because of this legal stuff going on. But

but we have an inheritment. Yeah, we have an arrangement with Circle, which is the owner of Polonias, that guarantees of all these people are going to get their money back. And we already started receiving all of that distribution. Why because we're big enough customers of Circle or Poloniacs for them to basically say, oh, you're a little guy, here here is your socialized loss. Right. So but none of our customers are going to see any of that in any case. Right, So we have our own internal fund,

some sort of reserve fund or something like that. Yes, you could. You're kind of prepared for anything, something like our job. Our job is Job number one is to always return all the coins to our depositors. Job number two is to remember job number one. Rule number one. Right, So there's no as soon as it falls apart, it falls apart pretty quickly, I would imagine. Well, so first any hedge funds will end to they have to give us collateral, right, so we don't. We never land without collateral.

Any exchange that we trade with we usually have their assets in our deposit as well. So for example, Circle, we we have a lot of USDC coins on deposits as well, so we can always offset these things, meaning we don't have real exposure. So we manage the counterparty risk all the time against all of these two hundred different hedge funds and exchanges that we work with, and that's our job. We we represent only the depositors. We do not represent the exchanges or the hedge fund everybody else.

Our responsibility is only for the depositors. Another thing is is like if you use our app, you can see like basically you can see how many users. You can see how much we have on deposit. So like right now we have three Yeah, I'm showing you my wallet, but if you have your wallet, you can see the same thing. So you can see like how much is

on deposit. So you can see what is on deposit, you can see how much you're earning, you can see how much interest We just crossed three million in interests, right. So so the reason for this transparency is because none of these banks and pointing because Bank of Americans right behind us, none of these institutions ever shared anything with you. The only time you know there's a problem is when we have to bail them out. Right, So getting an ordered from Ernst a year and a half from now

that that everything is fine. Right now, it's completely useless. We're talking about real time on the blockchain. You can order us on the blockchain and verify how much we have on deposit, how much did we land out, did we collect that interest? Did I give you eighty percent of what you were supposed to earn? So all these things are not things we were required to do by law. There's no law obviously, Binance coin based. None of these people do any of the stuff I just talked about

because they're not acting in your best interests. So so the average person needs to know that if they leave their coins on an exchange, they're probably subject to as much, if not more risk than they would be working with you. Bitfinex socialized losses. Binance did not because they had enough cash to but but Polonia socialis losses. A lot of these people, some of them are total loss, like the guys in Canada, the guys in Australia. Right laws there

was no recovery. So so it's a double jeopardy when you hold your coins on exchanges. You're helping them cheat you, You're helping them front run you, right, so at least remove them, right. I recommend to people to keep at

least some coins in cold storage. I always tell that, but I can tell you our community is not going to grow If everybody has to learn the mastery of how to use a treasor or how to use UH and how to work with private keys and all that stuff and keep it in a safe place, We're not gonna grow and have a billion users. So what Celsius

has done is done a half step. And basically we went to the community that doesn't understand anything technical and said, look, here's a way to come in and transact take benefit from all this stuff without knowing anything about bitcoin. You don't need to know anything to transact with us. And we have a service called sell pay that allows you to share the love with everybody without them having any wallets. Um.

Can we talk about the Celsius coin cell coin token? Yeah? Um, and so I believe you were paying an extra percentage if you pay that's the utility of the cell TOKENA is there is that still actively working on? So we we so we launched the cell token. UM Obviously, we did an i CE a year ago and we raised thirties something million dollars. We used all that money to build a platform, and three weeks ago we went live,

but with with the utility. Meaning, if you took a loan you wanted to pay interest, if you paid it with cell token, you pay less. If you want to earn on BTC, instead of getting paid in BTC, you can get paid in cell token. You earn more more. So instead of eight point one percent, you earned ten point one percent. Right, we issued that to everybody of our community. Came and said, we love you, grade I don't want to get paid in BTC, give me more

cell token. Right. Lawyers jumped and said, wait a second. In the US, you may have a problem with us, So hold the US, let us figure out what's happening. Continue you paying everybody BTC on BTC. So we didn't stop anything. We just told the people that wanted BTC for now, you're getting BTC. You're not getting self talking, right, and then when we resolve all these issues again. There was no action from the SEC. There was no any any enforcement action or anything like that. Right, this is

our lawyers telling us, let's do the right thing. Let's solve all these things. And again, our our job number one is to protect the community. So if we are doing something that may endanger the community, may may cause a regulator or one of our competitors are coming focus in the eye. That is not good for our community. We're doing exceptionally well. What about the rest of the

decentralized finance space. So you're in like a custodial type asset back loan type, and we're centralized you can use that word, where we are a centralized version of decentralized. And then there's then there's protocol bases, right, so the defied guys a compound of dharma or something like that. But those have their own risk as well. Sometimes the protocol doesn't work good, like we saw, I mean dharma.

If you got liquidated, you've got seventy six cents on the doll So so the cost of like if you get to the point where you get caught in the margin call, or you get caught because you were asleep and suddenly there was a flash crash, you're gonna you're gonna eat all of your assets without having any recourse. There's nothing, no one to talk to, it's a smart

contract than eight your coins. So it's curious where you see being someone who's been a step ahead of the game, pushing the envelope um where you see the DeFi space going and you do you guys have plans to get into more. Yeah, so first we support DeFi, So we have the die token in our wallet. You can deposit die with us, you can give us ether and earned die. I mean there's we do all of that, so we don't see uh defies as as competition or as a

bad actor or anything like that. It serves the purpose. A sophisticated guy that understands how the stuff works can either generate yield or generate leverage from these type of tools. But these are derivatives, right, I mean most people don't understand how stocks and bonds work forget about derivatives. So I would not recommend the average joe who's just finding

their way around the stuff. We has a job and have kids and have a wife and all that stuff to get into this game, because that is a game for prose and we land, we make money. We we sit on the receiving side of dice if somebody gets liquid and we are the ones collecting and distributing it to our community. So you want to be taking the risk. We want to be the guy who collects. We give you a strategy. Whoever liquidates the contract, we sit there

all day long and wait to liquid it. Why because it's an easy way to earn We just take to then give it to our coin holders automatically. So so that's one of those und fifty strategies. Right. So all I'm saying to people is, look, we're not hiding how we're making money. We just like Warren Buffett, Right, what if it tells you, look, I bought Where's Fargo? I have twenty billion dollars worth of else Fargo. They pay me six percent dividend every year. That's how I make

my money. You can buy it also. It's the same thing here. We have many many strategies. They're all available to anyone. Right Like right now we are collecting on cash deposits. Right we're paying ten point to five ten point one on cash deposits. Were using the cell because we can deploy it at much higher rates. Right So now again it's not gonna be there forever. It goes up and down, and it's only available sometimes and but on average it returns that ten percent and we give

eight point one percent back to the community. So so you want to you want to track all the exchanges and figure out where which one popped and go in there and open an account and manage they yield. And so we we we socialize the profit just like the other guys that socializing the laws. Right, So it's it's now.

The issue is trust. The issue is that most people don't. Again, they get screwed so many times in their lives that when they listen to this, they go and say, yeah, right, you know lex Yeah, this guy, this immigrant guy from New York who lives in a fancy apartment on Lexington Avenue, really cares about me and he's doing it for me. Yeah, right, right, And that's the issue. The issue is that we get conditions so badly by the banks not to earn anything on our money that when we see a good thing,

we don't know it's a good thing. The other thing is that and this is a little bit off topic, but another thing is that you know, today we're seeing society kind of paint capitalism or entrepreneurship or business owners as bad and greedy because we all have took advantage of it. But really, I say that a business owner is a servant. We're solving problems the only way to be good in business. I mean not obviously the banks

is a different story. But there are ten million small business in America and they do everything you said, and they're solving problems. They all I agree with you, but the not the profits. If you take if you take the profits in America car right, then you take the top four or five companies. They make more than half of all the profits. So the problem is, why are those guys, like when when JP Morgan makes thirty billion a year in profit, why aren't they paying their deposit

a little bit more? Just a little bit they can pay you. Understand, they make return on capital, so on average they can pay you seven seventeen on average in the state they're bragging about exactly they're stealing from you. Let's go through the scenario. They're certainly not they're certainly not paying. It's stealing. Okay, you make a deposit to the bank, right, they pay you one percent or less. They then turn around lend me your money. It's not

their money. Most people think that when I use the credit card, the Chase Manhattan credit card, the Chase lends me the money. No, it's not their money, it's your money. You get one percent. Now, why is there such a gap? It didn't used to be that way, right, People used to actually get a I used to make seven percent by the positing money with Chase. And not only not only are they doing that, but they're fractionally reserving it exactly. They can tender one exact legally, they have a license

to steal. Yeah, okay, so that's interesting. I know we're going super long. We can talk about this stuff wherever I love it. Um, we're at the bitcoin conference. Um, and so we're here with with a lot of bitcoiners. Uh, we're talking about that, and I really appreciate you getting into the risk and whatnot. Hopefully everybody learn from that. But I'm just curious looking out at the landscape over all. We talked about the DeFi space, but maybe what are

being at the blog Bluction conference. What are you seeing right now happening in the industry that has you excited and kind of hopeful for the way I see it is again, Communism, socialism, capitalism. These are three experiments at bettering our lives right, and again, I'm thriving in capitalism, right, but most people are not. Most people cannot just start a business and whip it out of nowhere and raise all this money and do well. And it's not because

they're not good people. It's not because they're not working hard. It's just they don't get in front of those opportunities. And decentralization is a fourth movement, it's like a fourth wave. It's an experiment, right, It's it's another experiment at bettering our lives, and all of us have to decide are we sticking with centralization, which is capitalism and centralization it's the same thing, right, And again I have that perspective because I'm one of the very few people that live

through all those systems. It's pretty hard to live in in communism, right, So so so for me, decentralization is like again, it's like a beautiful, uh shiny day, right that it's obvious to me that that system is better than the other three experiments. But for most people they look at this a decentralization. I don't even know what that word means. Right, So again I invite your viewers to do the homework to understand just go on Wikipedia and read about it. Right, it's not a new idea,

it's just an idea whose time has come. I actually I made a video I talked about it's the pendulum, and there's a cycle. And every every forty years we go from a week to a me cycle. And you can trace this back for thousands of years. And the last me individualisms decentralization was at the end of World War Two, and we've been going to a we a centralized cycle um with the U, N and the EU,

and we're just topping out where we're maxed out. And now the pendulum will sting back to decentralization and we have a people are tired. They're tired all that, right, They don't they can't put their finger on where it's not work. I don't know why. They don't know why. They don't understand why their money is not working. They don't understand why they can't pay off the mortgage. They don't understand why they cannot move ahead in their in

their life and their careers and everything else. So it's like the invisible hand is slowing them down instead of speeding them up. Right, if you don't know what the invisible hand is then research it, yes, then researchers and so it's again it's going from that, uh you know Adam smith idea of invisible hand to Austrian economics where it's all about deflationary powers. The bitcoin is a deflationary power.

There's less and less bitcoin every day because people lose coins, lose keys, and there's less and less mining with the halfing and everything else. So if you understand that, you go and say, wow, it's more powerful than goal. It's more powerful than anything ever created. Right, I brought a prop for that. Actually you see, so you know I'm a trillionaire. You never met a trillionaire, right, So this

is one hundred trillion dollars from Zimbabwe. But now the reason I have this is it's a it's a visceral reminder that the Zimbabwe dollar used to be worth one and a half years dollars and now a hundred trillion is worth less than one dollar. And that's the power of inflation. Right. This is a country that just went through craziness and basically get completely devalued its currency because they didn't have a choice. Right, So the same thing could happen to the dollar. It is, and and and

it's happening. Right. Since we went off the gold standard, we lost of the value of the of the dollar. People don't understand that. But you don't know why prices are getting more expensive, but their earnings are not. Their earnings have not moved in twenty years. So always saying is there is a different system, there's a different set of rails where all these rules of why you're held back don't apply. Right, you can join this revolution. It's here,

The future is here. You just have to choose to stop being abused by the banks and the financial institution and switched to a different set of rails. And we're writing those rails and saying, hey, we'll act in your best interests. So that's so. Then what you're excited about is the technology that we have and the change. You know. I love writing the caboose on that thing, you know, that's all I'm doing. I'm just writing the caboose and I'm having the time of my life. Yeah, it's awesome.

I put out a tweet I think two days ago, and I said, hey, I'm as happy to anyone to see bitcoin going up. Yes, but I'm here for the revolution. Yes, it's happening. It's happening anyway. You can't stop it. I mean again, Facebook trying to ride the same rails. But that's like a wolf in sheep clothing. You know, they're they're not part of this thing. You know, coming from communism.

I know we're going to wrap it up. Coming from communism, you have that perspective, right, and other people in the world have that perspective where they understand why privacy or why censorship resistant. And the people in the US have a hard time understanding that. But I'm thinking, you know, with with the data breach that Facebook had, um, they're starting to make the case as to why we need privacy.

And maybe maybe with Microsoft announcing a new identity thing and whatnot, maybe companies might start optimizing for privacy and making that a feature and helping to put you know, kind of push. Yeah, you're you're an optimist, an optimist, too much of an optimist. Maybe something I would say that Apple, Right, I use Apple? Why do example? Because everything Apple does is actually trying to better my life right, faster, cheaper, better.

Our operating system protects me, tells me how much I'm using the device every day, right, tells me if I'm sleeping or not. Like, so they're actually acting in my best interest. Right? And all I paid for it is nine hundred dollars, Right, I get all that stuff so tremendous value for what I'm doing. You can't say that about Google. You can't say that about Facebook. Ye. Their their model is the opposite, is to extract all your identity stuff sell it to as many people as possible.

You don't notice that, You don't see that, right, it's happening. Then it's like the invisible hand. Hundreds of billions of dollars. These are the most profitable companies in the world. Right, These these companies so so pretending somehow that they're gonna again change their spots. I'm sorry, these guys are greedy, bastard. I mean, when was the last time you heard Google say do no evil? That was the slogans I met Sir gay Bryn when he was still in Stanford, right,

and that was the slogan do no evil? Right, zook? Right, He's not. His job is not. He has to deliver that earnings for his shareholders. He cannot do anything for his customer. It's almost because the exactly just like the bank incentivize wrong just now there they have to produce. So if they said, hey, we're going to cut this data privacy out because it's it's wrong, you hit it on the head, hit the nail. So one one thing,

one things, because it's very important. Right. So the issue is that when you're acting in the best interest of your shareholders, right, which is fine, you have to always extract it from somewhere else. The only place to take it is from your customers. Right. And unfortunately, again we as customers are just taking all that beating without doing anything about it. Right. Decentralization offers you a completely new world. It's like suddenly you can breathe oxygen again, right because

the centralization. Look at Vitalic right with Etherorum, it values people based on their contribution to society. He created something beautiful. It was worth ninety billion out of nothing. Right. It's not based on profits. There's no profit in Ethereum, right, it doesn't generate anything. But that's what we're going through. We're going for a pyramid where everything is measured based on profit generation to a place where it's about the

network effect. Did you create a big enough network and did it provide value and didn't provide value, and it's your contribution to society that matters. Right, We're celebrating the people who contributed the most to achieved Italic people like that. So so I think, like you said, the pendulums swinging the other way, and we are doing all the right things. It's just most of the people insist on sticking with those pyramids, just like the Agian pyramids. That that time

is over. You've gotta move on, guys. Awesome, awesome, good stuff. We can talk forever. I'm really so interested in your perspective because of your background, and I love the political side of things, in the philosophy side. But that's another time. That's another time. The next interviewers, we're doing it on the next time. Next time we'll be in Baja underbikes

bringing the next you guys. All right, thanks for joining. Guys. Hey, if you like this episode of the Market Disruptors podcast, please help us take this to the top of the podcast charts. Just please do me a favor and rate, review and subscribe. Taking fifteen seconds to just leave a quick review goes a long way in helping us reach more people and disrupt more markets. I really appreciate you listening and I'll see you next time on the Market Disruptors podcast