When you figure out how to work with Blackloor, you can probably work with anybody else. And then eventually in March this year, we basically unbailed the project. A couple of things. One is the Tognized money market fund that we launched, which has very quickly become the largest in the world ever, the fastest growing exes.
It's a huge success.
This content is brought to you by bitco, which is one of the top crypto custodians in the crypto industry. Bitco works with many big companies and brands such as Pantera Capital, Bitstamp, and bitcoin Ira. Nike also selected Bitco to power its wallets for its NFTs and bitco has many great services such as hot wallets, custodial wallets, self
managed cold wallets, and NFT wallets. Many institutions trust bitgo with its top level security and incredible services such as being able to deploy your capital while it's in custody, which includes lending, borrowing, tradings, taking DeFi access, and more. If you'd like to learn more about bitco, please visit bitgo dot com link in the description. Welcome into the Thinking Crypto Podcast. I'm your host, Tony Edward and with me is Carlos Domingo, who's the co founder and CEO
at Securities. Carlos, great to have you on.
Thanks Tony for I'm here, very very glad to be here with you guys.
Yeah, Carlos, I'm really excited to speak with you. Tokenization has been on the adoption of tokenization has been on the rise, and Securitize is I think leading that charge. And I've known of Securities since back in twenty eighteen. So I'm really excited to have you on and I have a lot of questions for you. But let's start with your background, where you're from and what's your professional background.
I'm originally from Barcelona, from Spain, and that's where I was born and recently until I was twenty one years old, and my background is technology. I have a piece in computer science, but then I also started involving the kind of like the intersection of business and technology most of my career.
I also noticed you authored two books. Tell us about that.
I did so. The first book was many years ago, it's probably more than ten years ago.
At that time, I was the head of R and DN innovation for a company called Telefonica, which is a very large telecommunications company, and I got really into try to understand why some companies innovate and some mothers don't,
because telcods are not particularly famous for being innovative. And then over a book called The Journey of Innovation, which is kind of like a compendium of all the different innovation technologies that companies use depending on the stage where they are to do, you know, discovery and then commercialization, et cetera, which is basically a summary of I don't know, like ten or aut of fifteen books on innovation that I really like that they are you know, explained as
a journey through the whole process of innovation from like the research until commercialization. I was the first one, and then the second one was in twenty sixteen when I when I discovered crypto, I got fascinated about it, and there were very few books about crypto at that time. Now like a million, but twenty sixteen was very early days, and in particular, there was none in the Spanish language. There were very few that were English books that were
translated into Spanish. So I approached the editor of my previous book, which you know, sold quite well. So I don't know, like why did I grab a book about crypto, so I wrote it in twenty seventeen. He goes to go publish in twenty seventeen before the first would run. So it's very interesting because I was kind of like pitching crypto and bitcoin, and there was not a lot of things like DeFi, NFTs, none of those things existed
back then. And I remember like how skeptical people were about crypto when I was like going doing the tour books and in the book in Spain, etcetera. People didn't understand anything about it. They didn't know anything about it,
they didn't think it's like a real thing. So it was very interesting, and it also helped me kind of get deeper into the space because I had to do a lot of research about the first let's say ten years of crypto since bit kind of started until twenty seventeen when it got published.
Now you mentioned you discovered crypto or bigcoin in twenty sixteen. How did you learn about it? Did a friend tell you about it? Did you read about it on a forum?
That's interesting, so twenty fourteen even earlier, Yeah, twenty thirteen fourteen, that's the first time I heard about bitcoin. When I was a Telephonica because I was managing R and D and innovation. We used to do something called the Disruptive Council, where we will invite people to tell us about disruptive new things happening in the world to stay up with the trends. And then there was a guy from Silicon Balley, Jeff Clavier, who came and talked to us about bitcoin.
And I didn't pay much attention, just to be fair with like a lot of people heard forever. Then got into it, like I was like, what is this? Like, I didn't give much importance. And then then he started telling us the year after about blockchain as supposed to crypto bitcoin. How that was like shifting on the silicon body.
That's want A lot of these blockchain enterprise blockchain companies came up in twenty fifteen sixteen, But really when I got like the bag and I got really into the space was in twenty sixteen that's one of Thereum launched. And then and I heard from from a friend that was one of the first uh you know, I CIOs that he was launching a token, the Basic Attention token from Brave so and that's that's when I really got
into the space. Uh, and started like investing in icios, learning the technology and then decided to basically launch you know, atorganized fund first and then.
Securitized that friend was that brandan Ike. That's Brandon I am.
So Brendan was the CEO of Firefox and then became the CEO for a short period of time. And at that time I was working in telecommunications, so we did the project together to build a mobile operating system based on HTML five. Wanted to use web technologies as they frontend for a mobile phone. So Brendan and I, you know, spent a lot of time together. This was really pretty crypto, and then he pivoted to crypto very early on, like
even before the Theorem launch. He was he had the idea about the browser with the wallet to be able to pay for your attention and receive rewards, and started with big company. Didn't work because it is not suitable for that. And then when the third launch and he could create his own let's say currency for doing that process, that's when when the project really took off.
So yeah, I had Brian on the podcast years ago, and I think he's also the co creator of JavaScript of MAM.
He's one of the smartest persons I've ever met. Yeah, as a legend in Silicon Valley.
It's amazing. And you're both here building in Web three.
So there's a lot of people if you think about it. I saw that you had Mike Belch recently from Bidgo. He also comes from you know, a Web two and did a lot of work, and he was actually a Netscape and then Google. If you look at Jeremy Alair, so I knew who he was way before crypto because you're doing web streaming what I was Intel COO. So there's a lot of you know, especially people of our age which are like like the older generation of the
crypto people. We all come from web to technology backgrounds and got into crypto layer.
Yeah, it's fascinating. I was thinking about that not too long ago, about the number of entrepreneurs and builders who were in Web one point zero and Web two and now they're hearing Web three and it's fascinating. And I tried to share that as an example to people who still don't understand crypto, like this is the next layer on top of the Internet. And the folks who were at Netscape and you know, marking treason and all these guys, they're here. They're here building.
Correct, because it's you know, if you think about what was missing on the first Internet layer, there were two things, right. One was a way to transfer value because you could transfer you know, boys, communication, messaging, content, et cetera. But there was not a layer that allows you to transvalue.
And if you think about the Internet, the Internet is a decentralized network, right, like that's people was designed to be decentralized by DARPA, the Department of Defense Agency, precisely to be a network that is very resilient, right that you can all go down in case of an attack. So if you think about what a blockchain is, it's just basically a decentralized network that is very resilient, right, and it's cryptographically secure, so you can use it to
transfer things that represent value. So that's kind of like the missing layer on top of the Internet. I think the other interesting thing of how crypto has developed as opposed to the Internet is how people are monetizing the protocol as opposed to the Internet, that the application layer accrue all the value, so that the facebooks and the you know, the Googles of the world, as oppose in
crypto orre the infrastructure layer. Because of the ability to issue a token, then they accrue a lot of value. But yeah, it's a lot of similarities.
Yeah for sure. So do you feel that model is now flipped on its head to your point, Facebook collects all the monetization benefits, right, but the users they don't get anything unless you you know, buy the stock. But rather now you can be kind of an equity holder by having the token, you can have governance, say and on the network and be more of have more skin in the game versus Facebook is just monetizing your activity.
We shouldn't sayquit the whole lot. Otherwise this this is going to come and say those stop and securities that's what they are. They are to some extent, you know, I know there's a very controversial argument, but I agree with you. Like at the end of the day, they give you economic exposure on the success of the project, right, which is what securities are anyway. So that's why there is this controversy about whether the stock and sarch securities or not. But yeah, I agree with you that they
give you an option to participate. And this is why you know there is this huge retail following in crypto that maybe was not existing in other industries because of the ability to participate and get upside if a project does well.
Yeah, I need to rephrase or update my verbiage I should say, but you know, you get to participate and all right.
But by the way, this is the whole controversial about whether the can say securities or not that because you do actually get a commercial benefit out of it, right, So so arguably that's what securities are supposed to be, or investment contracts, and there's another argument that they're not because of other reasons. So but yeah, that's that's preciically the the conundrum there for sure.
So let's talk about securitizes. Tell us about securities. How did the idea come about to start this company and what you guys do?
It came out of the ICO time.
So when icios started to happen, and I remember that time, it was brave, It was argon with this uh you know, the centralized governance thing that I also knew the founder who else it was Bangkor, which was kind of like
the predecessor of UNISWAP. And there was like many of these icos that I was, you know, fascinated about the products, but at the same time being able to participate, as you said in the product right as an investor, being able to invest and receive something that would represent uh so well correlate let's say, in value with the sexcess
of the project. So and uh you know, because I come from tech, I've always been investing on the startups, investing, but with the with the Web one point the companies went public very early, so it was very easy to invest in public stocks, but then that kind of disappeared, so it was almost impossible to invest on the stock of a company unless you invest when they're private, or you had to invest in vcs. And then those processes of investing in on private shares, whether private shares or vcs,
are very cumbersome. It's very difficult to follow to do the investment, and then they're very liquid, so you don't know when you don't have a market to sell them.
Right.
So kind of Web one point zero IPOs were super early, so that kind of solve that problem, make it easy to invest and make them liquid. Then Web two that disappear, and then Web three that kind of came back with the token right, make it very easy to invest and make it liquid. Because a lot of these stockings were liquid right after and they had projects like bank or which we look at it very very closely at the beginning, as I mentioned, is the predecessor of unit in terms
of automated market making. That could create liquidity automatically right without centralized this change. So I thought it was fascinating, and then my observation was very naive, thinking why not apply this to securities? Right, so you have equity, you have lp inches of bcs, et cetera. Those are things that are difficult to invest and that are I liquid. So if you could take this technology and apply there,
then you can open up a huge market. What I didn't know, because my background is not you know, legal or regulation or finance, is how complex the whole regulatory environment of doing that legally is. Right, of course, a lot of people did it illegally from the beginning wanted to do it legally, but the whole idea was to apply the ICO model to securities. And then, of course, as I mentioned, we were very naive thinking this is a technology problem, and then realize it's not just a
technology problem, it's a regulatory problem. So I think that this is one of the reasons why in the twenty eighteen times when you guys met us for the first time, things didn't take off, right because of all the regulatory complexity, licenses that you need to do things in a legal way, et cetera. But that was kind of like the genesis of of securities, right. Take the ICO model and try to apply it as closely as possible to things that are regulated.
And that has evolved to tokenization and the ability to tokenize many different things. So I love to get your outlook on tokenization. You know, there's things I've thought of, like, okay, if athletes tokenize themselves or their contracts, or I, as an entrepreneur tokenize myself, what is your outlook and let's cover like the full gambit, you know, whether it's my house myself or black rock building and tokenizing a fund and things like that.
So first, tokenization is exactly what we did at the beginning, right. So when I say securities, if you think about the process of tokenization is basically you take an asset whatever the act is. It could be treasury is, it could be the contract of an athlete that you mentioned. We actually did a project with an MBA player about that because Stephen the Winded many years ago. Then it could
be you know, a building, it could be whatever. For the most part, like you issue a token that gives you an economic interest in the underlying asset that and that token is either a security or you have to securitize the asset through a traditional securitization process, which is basically put it in some sort of legal or rapper
and then give fractional ownership to this. Right, that's why we call securities right the way, like most people don't understand what we call securitize because toganization is basically securitization on asteroids, because it's like a very good way to do it. So to organization is what we've been doing since the beginning. I think that the problem is that and then obviously we've we've learned this over the years,
is that you think that this applies to anything. Right, you could talk because theoretically you could tognize anything you want. And there's all these people over the years have been saying everything will be tokenized, or the assets in the world, the real estate, or the contracts of the athletes and things like that, and the reality is that you know.
The token itself.
Tochanization itself doesn't necessarily addvalue unless there's all the things that come along, right that you make it easier to purchase, which sometimes is a regulatory problem, not necessarily a technology problem. You make it somewhat liquid, they're talking, that's something that the non organized version doesn't do, which makes it more valuable, like you know, easy to trade or to move around, peer to peer, et cetera. And a lot of these
early organization projects, we're not doing anything. You're just basically putting a token und the blockchain and that's it. So I think that's why it didn't take off. My view today is a bit different. I think that all these long tail toganization projects, like I said, organizing the contract of an mb athlete what happened, but will happen much farther down the road. And I think that today if you think about what has really taken off is toganization
of dollars, right, that's the stable coins. And then the next thing which is adjacent to it that is taking off now is the organization of treasures, right because these are like dollars but with a yield, but almost so safe as a dollar. And then and then you're going to go down that way, right like treasures will continue going, and then you will have things adjacent to treasuries, could be commercial paper, could be other you know, private credit,
et cetera. And then eventually you will get to this long tail of tokenized assets that will be tradeable and will be very efficient.
But I think we're still far away from from that situation now.
In regards to black Rock, you guys have a partnership with the Biddle and creating the Biddle Fund, which just five hundred million dollar milestone. Tell us about how that partnership came about and the fund and how the performance so far.
So we've talked to black Rock since I think twenty nineteen when when Roy Mitnick joined the company is the head of Digital Asset now and then we've been on and off talking to them about, you know, things that we could do together until around a year and a half ago. And this is when when Larry thing More publicly was saying that you know, talken is was the future of asset management because he sat it's a very efficient way of managing assets and provided more efficiency, et cetera.
And then we kind of restart the conversations with them about doing something together, and then of course we work with them behind the scenes for a long time. You know, getting to work with black Rock was probably a bigger challenge that we expected initially in terms of complying with
all their you know, regulatory compliance. You know, it's a very big asset manager, and it's very strict in some things, which you know is a good thing, right because you when you figure out how to work with Blackglog, you can probably work with anybody else. And then eventually in March this year, we basically unveiled the project. A couple of things. One is the Tokenice money market fund that we've launched, which has very quickly become the largest in
the world ever, the fastest growing et cetera. Is a huge success. And then the second thing was an estrategic investment of black Rock in our company, and then Joseph Shalom taking a board seat, and you know, continue working closely with them on enabling more functionality Forbiddle for the first first, because we think, I think we're just scratching the surface, and then doing other projects in the future as well.
Now I know some people who are new to crypto, blockchain and tokenization are going to say, so what so, okay, black rock tokenized. What are some of the benefits I guess the tangible benefits that maybe the newbie user can relate to. Is it faster, is it twenty four to seven trading? What are some of the benefits.
So the benefits of the organization depends on on the asset. Right, some assets, some tognized assets have this feature that makes them more useful for some of these don't. But overall, you know, what people need to understand is when you when you buy or when you issue securities, you need to represent the ownership somewhere. You need a ledger, right, So that's the premise. You need to have a ledger that you represent the ownership of the asset, and then
you could use any ledger. But blocking happens to be a very good ledger that is publicly available. Is you know, decentralized, is cryptographically secure, and that has if you think about the origin of blockchain, is bitcoin right, which was precidesally is a ledger designed to record ownership of an asset and being able to transfer the ownership of the asset in a decentralized way in a very safe way. Right, So the same thing applies to security. Securities need to
be represented somewhere. Today, many securities are represented in inefficient ledgers or in some cases that have electronic ledgers, they will have like paper ledgers, et cetera. And so that's one aspect of it. The other one is when you transact with securities, there is the security that moves, but it's also money that moves, right because you need to pay for it, or you need to redeem it against something, or you need to receive a dividend. So you need
to have also a ledger that tracks the money. And then we happen to have the same ledger a public blockchain that has a token that reference the security, and the same you know technology layer represents dollars as well, which is stable coins. So that allows you to do things in terms of moving money and security simultaneously in a super efficient way that it's impossible to international markets, Like most people don't realize.
When you transact.
International markets, things don't settle, like the transfer of the ownership and the money doesn't happen immediately, and that creates all sort of problems. You know, counterparty risk creates issues with you know, reserve that you need to have in case the price changes, et cetera. So all those things get eliminated on the blocks. You just make a very very efficient layer that allows you to transact with securities
and simultaneously in an extremely efficient way. And that makes it easier for those securities to then be used by people. Right because like if you have bidle, for instance, and you need cash because you need to liquidate your position, you know, you just swap it by USDC on chain and you get USDC twenty four seven available. You want to do that in traditional markets, good luck with it, right, So you have to notify somebody to do it. You
have to submit the redemption requests. It will take them, like you know, a they or two to do it. If you get caught up in the middle of the weekend, then it doesn't happen until Monday, there's a holiday. They also doesn't happen et cetera, because nothing is automated. Everything is manual, while these things are all like digitized on the same ledger and everything is automated.
So and do you feel that will open up secondary and tertiary markets, especially you know, both for retail and institutions. I know the retail tokenization aspect is still way off, like you know, but let's say people decide to tokenize some sort of rare artwork they have, or a rare car or whatever it may be. What type of like secondary in tertiary markets do you think might open up.
The first thing I want to say is that you know, there is this this misperception that toganization makes the asset more liquid, and it's actually not really true. Right, So what toganization does it makes the asset easier to trade and easier to transfer, Okay, And of course to have liquidity, you have to transfer the asset, right, So so one
thing is a prerequisite for the other one. But the fact that tochiniciation make it very easy to move the asset is not necessarily makes that the asset is going to be liquid just for the fact of being tokenized. And I think this has been something that the industry has gone wrong over the years, and that's why you've seen all these you know, rare art toganization that you just mentioned that people think, oh this do you have this Pikasso? And by the way, I also thought that
this was going to happen many years ago. I just you know, over the time, I realized it's not as symbol. But you know, I think that I'm going to tognize that Picasso on because you know, have a very efficient way of product fractional ownership and moving and transferring the ownership of these fractions of the pain. Then the pain becomes liquid. But you still need to have that market that wants to buy and sell the asset, right and then I think that for these long tail assets, those
markets are still not there. So today, if somebody comes to us and says we want to organize a rare asset like a rare paint, we will license the technology if they want to, but we will not get involved because they most likely probably is that this is not
going to be a successful project. So I think that we need to, as I mentioned, go from the most liquid assets, which are dollars and next treasure is all the way down building all the infrastructure not just for making the asset easy to trade, but also to have liquidity and having off market participants. So that goes along with bringing retail into the mix, which today most of
the organization projects. We do have some retail projects, and we've done retail projects in the past, but there is still a regulatory friction to do it right that has nothing to do with the technology. I think that will get eliminated over time and will get a simple way of retail to participate in organization projects the same way that they buy Apple chairs or you know, Tesla shares today.
And it's not a problem.
You kind of touched a bit on this earlier. But you know, let's say an entrepreneur, let's say Elon Musk, right, was to tokenize himself and this is like maybe ten years from now, but someone of that caliber well known, they see his vision, they see his success and the companies he's built.
Do you think people will do that?
And could it be that also new entrepreneurs can say, here's my idea, I'm going to tokenize myself and you share in my I don't know, earnings or whatever may be over time. Do you think that that might be a scenario that appears.
That's that's interesting.
So I mean, if you master today issues are token that gives you any access to his future earnings, that's going to be a massive success, right because obviously you know these guys like.
The most successful entrepreneur ever in history.
If you think about all the stuff he's done, so people will bet on him being successful in the future and they would want that, right, Why you must want to do that or not that's a different story because
he doesn't need to do that. But along those lines, we did this project, as I mentioned with Spencer Lin with him where he basically tokenized his the future earnings of his contract, so you could actually buy a token that will give you an interest based on the on the future earnings he was making on the on the contracts. And that was a very interesting project was it became very controversial. The NBA didn't like it. He went through all sort of regulatory and legal problems and ended up
launching but with limited success. So I think those are super interesting ideas. There's been also the same concept around toognizing uh, you know, royalty streams for music for artists, which is kind of similar idea of Okay, I'm an artist, you know any money to produce my music? I tell you, I tognized myself and of my future earnings of the royalties of the music that I produce, and and you you can you know, fund my business, right, So it's kind of like funding the personal if you want to
some extent, right, which is a very interesting concept. I think eventually these things will happen, but I still think that we need to create a lot more infrastructure demand than simplicity to be able to participate for these things to really take off.
Now, we talked about toganization of money stable coins and then treasuries, and you know what Black Rock's doing with their fund and so forth. What do you think is going to be the next wave? Will it be real estate as maybe that's a bit more liquid, and that's a very prominent asset class people are familiar with. Everybody understands you need shelter, But if I can if a building in New York City is tokenized, I might invest in that because I know the value goes up over time.
I don't know.
I'm gonna be a skeptic of the real estate organization, and I've been doing a lot of those projects over the years.
Perhaps though that's why I'm a bit skeptic.
First first, real estate is a very broad term, right, so you could have, you know, a blacks and real estate fund that contains hundreds of properties. They're very diversify, actively managed, paying dividends. I do see those things eventually becoming tokenized because why not. Those are like fans semi liquid, et cetera, all the way to like an individual property.
Let's say we were part of this crazy project many years ago trying to organize the Plaza hotel in New York when it was trying to when it was being sold. So those are like the two streams, right, Like you have a very diversify portfolio of things and a fun format that is real estate and it's huge that and
you have like an individual property. I think that those individual organization projects, they will still, you know, take time to get tokenized successfully because first, you know, you need to find a demand, and second you need to find the liquidity. Right And when there's a small property, naturally you'll have a small amount of you know, holders of the token. And then because you have a small amount of holders of the token, then you will not have
a lot of liquidity by definition, right. So I think, on the other hand, if you think about what's in between let's say real estate and treasure, is there's a bunch of a bunch of things in between, right right.
There's private credit.
Clos there is commercial paper, there's debt like bonds, et cetera, which are probably more suitable for coganization as a way to add, you know, treasure are going to go down in value the yield right because interest rates are coming down.
Hopefully this year they will do the first cut.
Right at that point in time, people will look for what's the adjacent in terms of risk. So it's a little bit riskier, but a little bit higher yield to start compensating from the yield that you're losing from holding treasures.
So and you also to feel that, look, the market is not conditioned. People are not conditioned to understand it. The first they have to understand it right, and then they have to recognize that, hey, there's a safe market out there to do these things where other assets can be tokenized. So maybe we're ten years away from now. Maybe it's my daughter who's going to be more into I'm going to buy, you know, the part of the Empire State Building or something like that.
The problem of these things is that, yeah, you need to have a very trustworthy marketplace where you know what you're buying about price, because you know, if they tell me, oh, you can buy a piece of the of the Empire State Building on one side, I will think this is
very cool. Because why not, like pri state building probably never going to go down in value, and you know, but at the same time, I wouldn't know how to value, you know, whether I'm buying something at a fair price or not right, because I have no idea about real estate, and I think, you know, the cast flow of property, the actual value, the potential value in the future. This is a very complicated thing that only very few people
know how to do it right. So I think that you know, being able to get enough retail demand for these things require, you know, marketplaces where people trust that there is a price setting in a fair way for people to participate, and I don't think we have that there yet.
Yeah, for sure.
Now let's talk about the blockchains you're using to do this. Obviously block excuse me, black rock tokenized on each theorem? Are you mainly using etherorem Are there other blockchains that you're testing as well?
So we started with a theorem.
That's where everybody started in the industry when we started, because there was nothing else. So plus sixteenty seventeen, Over time, we kind of recognize that the world is probably multi chain and we're going to have multiple chains, and therefore we need to support different chains. So what we did is basically created a substruction later for our platform so we can talk to different chains. And then I started
supporting all the change. We did some work in the past with Algorm, so the Exos talking for the Exos wallet was done in Algorm, and after that we've supported Avalanche, Polygon x sy more recently, and then we're now working with other block chains to be able to support them as well and be able to issue the same assets that we have on the theorem on multiple change, right, And that's kind of like phase one, which is what we're going to be doing from not till the end
of the year. So you're going to see more blockchains coming life in our platform soon, the major ones you can think of. And then now the second thing that we're also looking at is working with not have supporting multiple blockchains, but being able to bridge the same token across multiple blockchains. That has different implications in terms of.
How to do it and also how to.
Control the compliance of the talken because our talkeets are securities, but that's ultimately what we want to do.
Yeah, that's exciting. I think you answered my next question I was going to ask by interoperability, like can I move a token from etheroeum over to avalanche, So you will.
Be able to do it at some point in the future. In the near future. They were not talking about years. We're talking about months.
Oh awesome, I notice is probably under wraps. Anything you can share about what black rocks next tokenization project might be.
No, I kind of speak of we have a black Rock first, like black Rock is black Rock, and I'm security dies I can tell you what we want to do from security perspective. I think that as I mentioned first, I think Biddle is just scratching the surface. So if
you think about you know, stable coins. If you think all crypto is like around two point five trillion dollars, right, and then you have one hundred and fifty billion dollars on stable coins, The first thing I think is going to happen is that first scripture is going to continue growing, but the stable coins will grow faster because it's probably one of the assets that has the most product market fit of entire crypto, right, So it's only natural that
sable coins grow faster. So if crypto goes from two trillion to I don't know, ten trillion, stable coins are going to go from one hundred and fifty billion to two trillion because they will grow faster.
So that's the thinking. Now. The second thing is what's adjacent to stable coins is treasure is.
And today you have one hundred and fifty billion dollars stable coins and only two billion dollars in treasure. That makes no sense. You should have a much bigger percentage of the stable coin market that is in treasure is because in traditional market is actually the opposite. You have two dollars of treasure is per each dollar of actual cash. So of course cryptures will be different because stable coins are permissionless and treasure is our permission because of securities,
so I think it will be the reverse. But the fact that is only two billion out of one hundred and fifty billion makes no sense. And the only reason that is happening is because it hasn't been anybody pushing that market until we came in with black Rock, and now everybody's like rush into to grow this market. So I think treasures will still have a massive amount of
growth in front of us. And then I'm always a big believer of focus on not doing way too many things at the same time, even though sometimes we doing too many things. But if you can grow biddled from you know, half a billion dollars that is now to a few billion dollars or more, that by itself is a really good business. And then, as I mentioned, I'm
exploring what's adjacent to it? Right, what are the things that are adjacent to it that people they will have demand in the next twelve to eighteen months as the yield of stable coins start as or treasure story, it starts trickling down.
Right.
We already have a credit product with Hamilton Lane Scope, which is very good. It deals on average, you know, eighty twelve percent depending on the month it Sparak Credit is managed by Hamilton Lane, which a trillion dollar asset managers is very safe as opposed to a lot of the tokenized credit that have been in the crypto market. So I think those asset classes are very interesting for us in terms of launching more projects.
What do you think about tokenized goal because as you're saying that, I thought of why not goal? I've heard different people working on things, I guess, but what are your thoughts on that?
I think that the I was talking to a friend this weekend about that. We don't do commodities, So tognized goal is a commodity, and we do securities because that's where we have strength and mode, because we have the licenses and the experience how to do it. Securities are
much more complex than commodities. I think there's an argument that because toognized commodities or gold or oil or whatever could trade in different venues at different times than the actual goal, that this has valued right because you know, I think recently the packs of stognized Goal, I think it was training at a completely different price than the actual goal. And the reason was because there was the manduring the weekend and people could buy packs of organized
Goal but they couldn't buy normal goal DDF. Let's say so, and I created this location in the market, which I think is interesting for people doing arbit trust.
Right.
So I also think that commodities, maybe the coganization process is not necessarily the same like you can do purpose. I think it's a company Cale Color organ is doing that, creating perhaps on the price because people sometimes they just want to speculate on the price, they want to actually own the asset. So that's something else that own security is a bit more complicated, especially more liquid securities, so that might happen there. But yeah, I think it's very interesting.
I think, you know, those are just very different problems, but both of them are equally interesting.
On the note of that situation would go where the actual goal market is so to speak, for the weekend, but the token ies can still be purchased. What do you think we see the full twenty four to seven trading of securities and commodities on the blockchain? What's your timeline window where you know there's no opening or closing bell.
Well, first, what people need to understand is that there's no reason why the New York Service SCEINS doesn't open twenty for seven. There's no regulatory reason. It's more like a tradition that the traders will trade in the morning and they will go up stop working at some point then the venue process. But there's more and more liquidity outside trading hours. And then some brokers like robbin Hood, they enable twenty for seven trading for a lot of
stocks already. So I do think that you will see like national market stocks trading twenty for seven on traditional exchanges before they happen on the organized space. Because also, if you think about the most of the organization projects, they tend to focus on prid markets because national market securities, let's say like an Apple share Tenesila share have their own like regulatory restrictions in terms of how you trade them that the tokenized version of it is complicated to
do from a regulatory perspective. So I think that those markets might not be the most suitable wants to go with organization, and I think the twenty for seven will take care by itself.
With traditional markets.
I think this is more interesting to organize anything else that is actually not available and not tradeable and not in any venue.
Right, So.
Yeah, definitely makes sense. I'm excited for that feature that where the markets can be twenty four to seven, and especially.
Robinhood already I am.
I'm a big fan of rowing Hood and I use that for my own personal training, and there's a ton of stocks in Droming Hood that are already twenty for seven.
And then you know, in addition to that, with tokenization, do you feel that it will open up assets to different countries and jurisdictions. For example, not everyone can access the New York Stock Exchange if you're in certain parts of the world, but maybe with tokenized securities and ass and commodities. Anyone can access those tokens.
That's a that's a very interesting so that part.
I do think that if you can solve their regulatory challenge to do it legally, because when you create a talken, and by the way, there's been some companies in the past and crypto that they've been trying to do this and some of them were shut down by regulators.
So I think that there is a path to do it.
But it's not a straightforward if you want to do it in a legal way, because even if you talk an test lash yers and sell them to the Philippines, you're still touching a US security, so the US regulators can still go after you, which actually happened in the past with some companies in the space. I don't need to mention anybody, but I do think that's an interesting value proposition, right, Yeah, this this digital twin as a talken that tracks the price of stock to be able
to offer it, you know, the jurisdictions. I think that how to do it legally is where the tricky part is. But yeah, I think that that will probably happen, you know, sooner than later.
Let's talk about the crypto market at large. We talked about you know, your background and discovering Bitcoin Circle twenty fourteen, then twenty sixteen and so forth. What are your thoughts on how the industry has grown, The ASD class has grown. We have bigcoin ets, we have e theorem metfs. It's pretty amazing.
Look, I'm pretty happy that, you know, things are now growing in a much more stable way and a lot of the craziness and that happened the last few years is gone, because you know, the twenty twenty one grandpap in crypto, in my opinion, was purely speculative for the most part, and in many cases by people committing fraud bay openly, like you know, all these lending platforms like
a block fi cell. To say, anybody that understands securities regulations knew that what they were doing was illegal and they didn't care. And I think that's not good for the industry that you have these people trying to play regulatory aarby trash, and then you have FTX with nobody knew they were doing something illegal and internal that it was actually the biggest illegal thing. And then after a Luna and then you have you know, so many of
us strut. So I think that I'm pretty happy that a lot of these things are pasted and whoever needs to be in jailer's in jail, whoever needs to go when bankrupt and they're out because there's a bad actors that you don't want in the industry. And I think now people seem to be focusing on building real stuff.
And I think this whole narrative and real weal assets came right after this debacle that happened a few years as a way to It's a terrible name, by the way, but it does signify that the crypto people think this is real as opposed to what was happening before, which was not real. Right, So I think that's that's interesting. But I still think that there's first there's a lot of people in crypto that are there as pure and another place where they can speculate, right that they could
care less about crypto. It's just a more inefficient market, so I might as well specular here than eespeculate somewhere else that is a more either regulated or mature market. There's a lot of people that are like grifters, that are like just in crypto because there is an opportunity to issue attacking and make money or an FT or whatever. But there is a significant amount of people that are trying to build real staff that actually has real utility,
that solves real problems. And I think that portion, which used to be the minority in my opinions of crypto for the last ten years, is kind of growing and that will probably lead to two real usages of crypto that solve real problems, which today, in my opinion, is what is lacking.
So yeah, yeah, absolutely, And I've been trying to highlight as much as possible, like the real world adoption. Like just yesterday, Avalanche they announced that the state of California put a bunch of vehicle card titles actually millions.
Yeah, we reposted that.
I mean, there's not really nothing to do with us, but we thought it was a good example of somebody like Avalanche, which they're really good friends, and I really appreciate what they do of trying to build real stuff, right, things that have real utility.
Absolutely.
Now you touched a bit on you know, security laws and clarity, and in the United States we're still waiting for comprehensive legislation, but there's been Carlos I mean an amazing impact on politics. Cryptos had an impact on politics where you have presidential candidates endorsing crypto a build a market structure, build madeia out of the House. We're waiting for it to go to the Senate. What are your thoughts on all this and do you think we get clear regulations by next year?
It will all depend on where the elections go, obviously, because you have one candidate that obviously has been very vocal. I saw the specieve at at the BITCN conference in Asville this weekend, but I watched it live and I thought it was whoever wrote that speech knew exactly what it was the crypto communities is waiting to hear. Yeah, so it was very refreshing to see, you know, a presidential candidate actually speaking about these topics and supporting the industry.
So I think if if the Donald Trump becomes the president, we'll probably see a much more favorable regime in the US. I don't think that things will change overnight because these things need to be approved, they need to go. You will all dependals on, you know, how the House and the Senate end up being configured and who has control over those things. Because as you don't think it. I approved the House, but they have to go to the
Senate and then they go to the President. So so getting things that prefer the US is not a simple thing. We certainly see we'll see a much more or friendly SEC and much more responsive. As you might know, I was actually an expert witness in Congress about an organization. What we do shouldn't be controversial, should be something that both you know, parties should support, but unfortunately doesn't seem
to be the case. And that's pretty sad because you know, if our staff on organization is controversial, I can't even think about you know, feed twenty one or stable coin bills or things like that. But I do think that eventually this is you know, a two point five tillion dollars industry that is growing and that is here to stay.
So somehow, you know, we need to have regulatory clarity and loss that regulate what happens because otherwise, you know, people can get hard, right, So we've seen this with a lot of the issues in the past of the lack of regulation has not let to stop frauds.
So yeah, great point. All right, I got some wrap up questions here for you. Carlos first, if you could create your own meta verse, well the tem me.
My own metaverse. I don't know. I'm a diver. I like diving.
I've been diving for many, many years, and I think that being underwater, like when you're like deep, is the closest thing has been in a different planet. So but I know a lot of people don't dive because it's you know, they have classophobia or they're afraid about being there. So I will build the metaverse that you allow people to experiment what is to be underwater, like at a death certain depth and see on the beauty that you know, the sea has to offer us that is not available to most people.
Yeah, I would love to have an immersive view of them. Is it called the Mariana Trench at the deepest part of the ocean, I believe it.
Yeah, well that would be amazing because that's even way deeper. Right, But you know, even if you go, you know, I have an advanced budy, you can go like thirty or forty meters, which is pretty deep already, and it's beautiful, Like it's so different, it's like you're in a different planet.
So, yeah, there's so many unique ocean creatures and things like that. It's like rare fishes and all that. It's incredible. Rapid fire questions.
Favorite food, Wow, So I'm Spanish, so obviously I love Spanish food. I think it's probably one of the best custines in the world. But I also live for over ten years in Japan, which is probably the closest thing to the bestest food in the world compared to the Spanish one. So I'll have to take both in this case, the Spanish and Japanese food.
Favorite musician are bad.
Probably David Bowie. Favorite movie Blake Runner. That's great. Favorite book. Oh wow, So I.
Don't read novels, so that's just a premise. So I don't read novels. I only read essays or business books. So within that context, I employed. One of my favorite books, and I actually met the author before he passed away many years ago, is The Innovator's Dilemma from Clayton Christensen. So this was a This is a very really good book about you know, why innovation happens and it doesn't happen.
And Clayton was a very articulated person that was a professor and that built his own consulting practice after so I think that's one of my favorite books.
Yeah, you're the second person I've heard within the past month who recommended that book.
It's a very good book. There's two good books, and The Innovation If I can, you can have a second one. So The Innovators Dilemma is very good. But then there's one called Crossing the Chasm, which is very interesting as well, and perhaps crossing the Casm it's more relevant for our industry. So Crossing the Cosm is a I called Geoffrey Moore.
He wrote the book. I think I wrote the introduction to the twenty fifth anniversary edition in Spain like five or six years ago, so it's probably thirty years old
or something like that. But it talks about, you know, the adoption cycle of technologies, like why some technologies seem that they're going to be adopted and they never get adopted, and some others that get adopted by everybody, and what it takes to move them across the different population of people adopting technology, and it's very relevant for things like crypto and most of the startups. Founders should read that book because it's very interesting.
I'm definitely going to check that one out. So thank you for that recommendation, Carlos, absolute pleasure and I love what you guys are doing and securitize and congrats on all the success and I'm sure I'm going to have to have you back on in the future. Is things progress with black Rock.
And definitely don't take another five years to bring us back for sure. Thank you, Carlos, Let's get Tony. Thanks for the interview and it WST