Hi everyone.
I'm Tony Edward, I'm Amanda were Croft, and we are recording at the Salona Policy Summit. And joining us is Anthony Scaramucci, who's the founder and managing partner at Skybridge. Great to see Anthony.
Good to be here. Thank you guys for having me.
So, Anthony, what's happening with this bear market? What do you think we might see a recovery?
So I'm old school, I've been in the category that this is a cyclical bear market, traditional to the four year cycle of bitcoin, and you've just crossed the halfway mark of the having and so you're on your way to the back half of this thing. You typically don't get any type of real recovery until the first quarter of next year. And because we had this slightly accelerated, and I think this was macro related to President Trump and some of his tweeting and the tariffs, and then
obviously now there's a war. You know, although I would say bitcoin has been fairly sticky during the war, you know, over the last five or six weeks of the war, you probably won't see a recovery in bitcoin until maybe the first month of the last quarter. Right, So we're talking October possibly November of this year, and so you know, people will be very down on bitcoin, they'll be very down on the all market, be very down on Solana, and of course they'll be wrong because it's really just
more of a cyclical thing. But I think what people are upset is that they thought, wow, we've got a new administration as positive on crypto. We're basically in like a jail house with Joe Biden and Elizabeth Warren. You know, we were talking before the show started. I mean, these people were brutal, and so you were thinking that you were going to get better regulation, You're going to get better legislation, and you were going to get a ton
of buying as a result of the ETF activity. Slani ETF a theory METF bitcoin ETF quite celebrated and you didn't necessarily get that, but you did not get it. Meaning you're still seeing a lot of bitcoin buying, a lot of boomers are buying bitcoin, but it's just not enough, you know, because you got whales that are selling into the You know, the ogs in this industry believe in the four year cycle, and so what they do is
they fulfill the prophecy of the four year cycle. By acting on the four year cycle and selling, you know, the whales were pumping lots of coins into the supply at around one hundred thousand, and that's why we dropped into the high sixties.
I know you had mentioned recently on a CNBC interview about two months ago or so that the boomers are hesitant to invest in bitcoin because they're more they're they're the older generations are more trusting in assets like gold and silver. Do you think legislation like Clarity will help bitcoin become a less volatile asset?
I do. I mean I applaud more organ Stanley for making the decision to launch it's bitcoin ETF. They priced it like fourteen basis points, which was a very competitive price, and they've got a huge wealth management division, and so if they even just move a half a percent or one percent into bitcoin, it'll be very very good for the market. And it's another sustainability issue. I think what's completely off the table is the notion that bitcoin is
valueless and all that other stuff. The just the network alone makes bitcoin very valuable. But if you don't get the Clarity Act legislation passed, you're not going to get the banks to really open up Sure Bank in New York as an experimental program. I think so far now has an experimental program, and there's probably others where you can store or I'll hold your bitcoin and custody in
those places. But until the big money center banks. You know, when my private banker calls me and says, yeah, move all your bitcoin. You can move it here to our bank and we'll give you yield on it, or you can be and you can really borrow on it as opposed to the twenty five percent LTV as some of the big money center banks, you're not gonna see the
real full throat of adoption. So you know, I think I think the estimate was in November of twenty twenty four, and I would have gotten this wrong, of course, because if you had asked me this question, would the stable Coin Genius Act the Clarity Act both be passed by the end of twenty twenty five, I would have said yes. But here we are about to start. You know, we're in middle of April, heading into May. We don't have Clarity passed.
So Anthony, the banks, while they are adopting this technology, they're pushing back on the stable coin yield, which is holding up the Clarity Act. How do you think that gets resolved?
Well, I mean, of course they are right. I mean so, I mean, you know, this is a bigger meta question for the United States, which is, if you pay the lobbyists, the regulation will come p a simulant to what you're paying the lobbyist. This is the whole Citizens United thing. You know, we've we've gone up eight x in the last fifteen years in terms of campaign donations and donations related to policy, and so you know, the banks have a huge stronghold in the marketplace. The big irony is
talking about Elizabeth Warrens. She supposedly hated the big banks, but now she's basically one of the big advocates for the big banks. I mean she basically takes their memos and puts them into her writings and her proposed legislation. So I'm of a you know, I respect Brian Armstrong at coinbase, and I understand the position he's taking, and I mean it may lead to us not getting it done this term, and if the Congress switches, it'll probably be two or three years before you get something done.
I'm a little bit more proud to I probably would have tried to get something done, and I would not make the perfect deal the enemy of progress. And so just quickly, the best example I give you that is that Bitcoin ETF. Gary Gensler hates us. He did not want that to happen. He lost the lawsuits, so he was forced to have it happen. But the way it came about was ridiculous. It was just like punishing. You had to put cash into the ETF, and then if you wanted to get liquid, you know, get your money
out of it, you had to take cash out of it. It was ridiculous. Paul Atkins had to rewrite the rules allow bitcoin to go in and bitcoin to come out. He did the same thing on a theory and with the staking couldn't stake it. It was ridiculous, you know. So but we got it done, and so that was progress on the way to perfection. I think if you put the perfection before the progress, particularly in a place like Washington,
it gets gummed up and it may not happen. So, you know, I would prefer the progress over the perfection. But that's me.
Has Crypto aligned with one party Nicole.
Wall Street or you know, and Brian's sort of like a mystical religious figure in our industry compared to me. Right, but go ahead, keep going.
Has Crypto aligned with one party too heavily to pass by a partisan legislation, Yeah, you.
Know, on the margin. Yes, But I think that was out of necessity because they really didn't have a choice. I mean, the Democrats decided that they were I mean choke point two point zero. I mean I was in the meetings. You could ask Novograts or Mark Cuban, you know, I was in the meetings with the White House people in July of twenty twenty four, and then we set up another meeting in Treasury and these guys were like
very antagonistic. So you know, if one party is going to be that antagonistic to you, you're gonna be probably one sided on the other side. Now, I would like to see, and I think David Sachs has said this more eloquently than me. I would like to see this be postpartisan. You know, you know, whether or not we have gold in our reserve, like our strategic reserves is postpartisan. The answer is we have gold. So to all the other countries, do we have oil as a strategic reserve?
The answer is yes. It's not a partisan debate. You don't have Elizabeth Warren like saying can't have oil, it's bad, and you know it's a horrific asset, and we don't have that, so we have to we have to get off of that. But I understand why I got that gott in that position.
Sorry, coming off of strategic reserve. Do you think that the government should hold bitcoin and strategic reserves?
Yes, but I think it's very hard to hold bitcoin in a strategic reserve if it's a partisan issue. And I think if we can get this to be a transformative, postpartisan what's right or wrong for the country, what's right or wrong for the American tax payer, then the answer
is yes. But if you're in a position now where lots of people in the Congress don't understand it, lots of people really understand the future of money and where it's going and what bitcoin represents in terms of the operating layer of decentralized forward money, it's not going to happen. So I wouldn't push it. I'd be more or less where they were on the Executive Order last year, where they said we're gonna we win some in a lawsuit, We're going to keep it. We're not going to sell it.
What's ever on the balance sheet of the government right now, we're not going to sell I mean, the Biden administration was selling it right up to the end. I'm not sure if we've done an audit yet, so don't quote me on this, but I sort of think we haven't done an audit yet of how much Bitcoin the US government actually holds. But my attitude is my mission would be,
let me rephrase that. My mission would be to explain it to people so that they get it the way the three of us get it, and then it doesn't have to be debated anymore. It just becomes one of the things. You know, we have twenty eight different assets in our strategic reserve. From a government balance sheet perspective, It's not just goal and oil. There's rare earth minerals in there. There's other commodities that we think are valuable
to the manufacturing process. There's medical equipment, medical supplies in there. In the god forbid, we go through another pandemic, and so those things. No one's sitting around saying, oh, geez, you know, let's debate the partisan benefit or detriment to having that stuff we got to get bitcoin there, but yeah, it it should should certainly be in the reserve.
How far away do you think we are at from the consensus to have both parties in agreement that we need to have this reserve? Its five ten years away.
I don't think it's that long. I think again, I don't want to make this a political podcast or anything like that, but I think the president. Let me stipulate this, and some of your viewers will be mad at me for saying this, but I think it's a factual statement. The president's polarized. Some people really like him and some people really don't like them, and so his detractors, if they don't like him, they're like, well, what does he like? Well,
he likes crypto. Okay, well he likes crypto. I'm not gonna like crypto. And I think if you can get a less polarizing person in a position like that, I think you can move closer to something that's postpartisan. Was that too political? I don't think so. Right, I would give me a factual statement about where we are. You already get a lot of heat anyway, so I don't mind taking the heat. It's fine.
I think a lot of this has been politicized, including the technology itself, which is unfortunate.
But that's just where things are, I mean, but that should also make you very bullish. Can I explain to you why? Because every headwind that you can imagine has happened to this technology, Bitcoin solana, bureaucratic headwinds, lobbying headwinds, banking association headwinds, the sclerosis of Wall Street not moving quicker to adopt the technology or to adopt tokenization. Every different part of this that you could imagine is blowing
in the face of these assets. And then look at where these assets have gone over the last fifteen or sixteen years. Now, yeah, granted they're off their cycle highs and they're off their all time highs, but think about where they are, think about the use cases, and think about the exponential adoption and the expansion of the wild It would be impossible to really study this and have a four or five year frame of mind and not be bullish. If you have a five minute frame of mind,
then your bearers. Because we're in a bear market, and what happens to a bear market is people say this asset's dead and they walk away from it. But you know, underneath it is the growth and the exponential activity and the fact that it's just better technology.
So on that note, every major Wall Street firm is tokenizing or has a tokenization strategy. It includes the stock exchanges looking to go twenty four to seven? Anthon, you have a plethora of experience in the markets. Where do you see the twenty four to seven markets in five years or so? And how does that change?
Want sooner than that? I mean, I would say in the next two to three years you'll have twenty four to seven stock and bond trading. I mean, the Nasdaq announced the deal with Kraken where they're going to use Kraken's rail system, start the process of tokenizing stocks and let them trade twenty four to seven. We have the capability to do that. I would make the argument, you know, when I was a kid in the industry, we were literally T plus five. It took five days for a
stock that you bought to land in your account. Now we're T plus one. Everybody knows that's listening into this. Generally, the people listening in are quite sophisticated. They know you could do it in T plus an hour through the blockchain, and so the question is whether that be better for us or worse for us, And I think it'd be better because when you have twenty four hour liquidity or
twenty four hour activity, it changes your risk profile. Like if you've got a war going on, or you don't know if the straight of war moves is going to be open or not open, and you're looking to get out of something, Well, guess what's open. The crypto markets are open, so you know, Okay, that's where my source of liquidity is going to be in the overnight markets. And if you had everything overnight, then you'd have massive improvement in liquidity. So I think would also change the
profile and perspective of people. So I generally think I generally like it. I think it happens in the next two to three years. How's Skybridge preparing for that? Is it too early for you, guys?
Or will you have international teams or AI helping you trade twenty four to seven.
I think anybody that's not using AARI right now is missing the boat. We use AI. We're long term investors at Skybridge, so we don't really have international teams. I think we're reasonably well positioned. I think my thing at Skybridge I have to almost be like a shrink or a life coach for some of my investors. Stuff. Calm down. I know bitcoin went from from here to one to twenty six and it's now in the high sixties, low seventies, and everyone's upset. Got the hair on fire. You can
take this to the bank. Everybody is a long term investor until they have short term losses. Admit they have short term losses. They go crazy, They run around and yell at everybody, and then they blame you. But if you just calm down and you see the super cycle that we see, you're going to be incredibly well rewarded in the future. So my job relieves just keep clients clock calm at this moment.
One more question for I let you go. You've got Skybridge Crypto investment. Any changes to your portfolio. I know you've been bullish on bitcoin, Avax, things like that.
So we own Solana, we own Avax, I own Avalanche, I'm sorry, the Treasury, you know, the Avax one. We own some Forward which is a salon of Treasury, as well as Solana. We have some STRC, which is sort of the ill bir bearing securities coming out of strategy obviously have a very large position in bitcoin, and so you know, listen, I'm long term bullish on this stuff. It's not a great environment for it. But again, if you looked at where we were five years ago to
where we are today, I love where we are. Oh. I can't believe the growth in this industry, and so I just believe that if we're sitting here, if I'm lucky enough be sitting here with you guys, five years from now, I think we'll look back and say, wow, those prices in twenty twenty six. I'm not sure why people were so negative given where we are today in twenty thirty one.
All is a pleasure, Anthony, Thank you so much. All right, thank you guys, thanks for happening. This episode is brought to you by Bitco, the trusted infrastructure behind the digital asset economy. If you're serious about crypto, whether you're an investor, institution, or building in this space, you already know security, compliance, and execution are everything. And that's exactly what bitgo delivers.
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