FTX Shows Crypto Still the ‘Wild West’

Fried's FTX Exchange. Now, before this, he and his firm were long considered one of the most stable cornerstones of the industry, with the third year old billionaire known as FBF even being described as the JP Morgan or Warren Buffett of digital assets. Even if you've never even dabbled in cry though you've probably watched f t X is funny Super Bowl ad with Larry David, we're seeing FBF paddling around with Tom Brady, or maybe you noticed the f t X logo on the chest of Major League umpires.

So what does it mean for the market when such a high profile pillar of the industry collapses in a matter of days. We'll get into it with the chief executive and the chief investment officer of a quantitative crypto hedge fund. But first, fil Donna. You know before every podcast you write down like forty seven questions to ask. I have so many, so many questions. Now we had we actually had SPF himself on this podcast, and I noticed you never asked him like, hey, SPF, when's your

thing going to blow up? Well? That but that's the thing about his whole company is that everybody thought they were going to be I mean, they were like the gold Star right. And I'll confess I had a do quan on the podcast one week when it did not occur to me to ask him, when's your thing going to blow up? Hopefully no more blow ups. I'm blushed. People can't see me, but I'm blushing. But you know what, the thing is, in crisis, there's opportunity when stuff blows up.

Sometimes traders make the most of it. Yes, I do want to bring in our guests. This is the perfect week for us to be talking to them. I'm really excited to have them on. We have Sadie Rainey. She's a co founder and CEO of Stricks Leviathan and Nico Cordero, he's a ce IO at the company. Welcome to both of you, and thanks so much for joining us on this week's show. Thanks for having us. It's really nice to be here. Despite this week likewise, great to be here.

It's definitely a rough week, and I do want to get into um all about you guys, and um what you do and how you're faring and what this week has like has been like for for both of you and for your teams. But maybe Sadie, we just start start with you and and I'm hoping you can just lay out for our audience what exactly happened this week? What were some of the major factors the major players involved. So great question. I think that's actually the question that

everybody's trying to figure out right now. What what did happen or what is happening? And the big big issue here is really I don't think we have all the pieces of of information. And really it started at the end of last week when there was some back and forth between Finance and f t X on Twitter. You know, there was a lot of I guess allegations going around, which there was an immediate response from f t x um, you know, kind of that everything's fine, We're all fine, um.

And then suddenly, you know, there was very clear signs of distress um for f t X in the market, and Finance came forward with an offer to acquire or bail out f t X more or less, which was very quickly rescinded um. And in that whole process there was a large run on f t x um which dried up their liquidity, leading to them freezing withdrawals. And now there is a very aggressive attempt by f t X too finds a solution to their liquidity so that

they can make their investors whole. You know. Also, if i'd be curious if did this catch you guys as much of a surprise as it did the rest of us. Yeah, it did to be frank, I mean, the speed of which we turned from you know, small rumors on the internet that didn't seem to have validity into f t X freezing accounts was all in a span of about

thirty six hours. And like you mentioned in the opening, you know, f t X was largely considered the most trustworthy institutional player in the space outside of the us UM so not including coin base and others. Um, so, yeah, I think it was. It was. It was quite a shock, um, and a lot of folks are surprised and angry rightfully. So, yeah, Nicole, I imagine it's and and city. I imagine it's impossible to run a crypto hedge fund without having some sort of exposure to ft X, you know, either as a

client or counterparty in some ways. It is it creating any issues for you guys, Yeah, I mean it is difficult to not have exposure to them, you know, within the US. You know, preferably we'd like to keep our capital in the US under US regulated exchanges. But if you want access to derivatives, perpetual futures and capital efficiency through the type of instruments that are offered offshore, you like, you have to be off shore, you know. So we were there. We're a counter party to them. We do

have some funds frozen there. It's not the best of situations, but luckily for us, we are, you know, place a large emphasis emphasis on risk management, and so we only had a small portion of our portfolio allocated there, simply because this space is the wild West, and you know, you expect these things that happened just not to ft X any communications or indications of of one n F you'll be able to withdraw funds. At this time, it's a very fluid situation. We're not sure you know what's

happening behind the scenes. And Sady, maybe you can talk about just the significance of the events, because we've been we've been talking about how it's been a rough week. Obviously crypto markets tanked at one point during the week it seemed like the horrible sentiment from crypto also had spilled over into the equity space where we saw the SMP five hundred also selling off. Just what is the significance, Like, how momentous of what unfolded over the past couple of days.

How momentous is it? It's really momentous in this situation. You know, we've been through a number of market crashes and you know, in the past have also traded with Voyager, or we've used Voyager, not for trading, but we've used Voyager in the past. We also use block Fire, and when there were some indicators that maybe there they were I guess you could say over over their skis um, we stopped trading with them, you know, well ahead of of what happened last spring, and this one I don't

think anyone saw coming. You know, it was really quick how it happened. It was really fast. And I was actually speaking at coin al It's last week up in San Francisco on Thursday, ironically, and one of the topics I too talked about was risk and how you know, the reason people love this industry is because the crazy returns you can get, but you know, you pay for that with with risk, and you have risk across every avenue,

and counterparty risk is just one of those risks. So you really have to make sure that you're looking at, you know, all the areas out there, um, and you're never literally putting your eggs in one basket because you can never be sure at this stage that everything is what it what it looks like it is on face value.

Was it also much more shocking considering that we basically had like weeks or even months of a very I guess we could call it a calm market where we really didn't see prices searching or plunging in any way, but just like meandering for a really long time. Yeah, I mean that's exactly correct. I mean, from the outside looking in, it looked like crypto was stabilizing, has sort of forming a foundation from which to find strength after the chaos of May and June um and things were

starting to trend, you know, upwards again. Things you're starting to look um like crypto used to look in the early bowl markets. And then obviously everyone was sidewiped by this revelation that you know, very few if anyone, saw coming, you know, city, I know sort of one of the appeals of quant investing is that, you know, you let the math do the work and you sort of take

out the human emotion of things. So this strikes me as something that you know, even a quant strategy is going to struggle with just such an out of the blue occurrence. So I'm curious if you could talk about some of your strategies. Um, I know, you have a market neutral strategy that in theory, you know, should be able to weather a type of collapse in prices like this better than a sort of on only or levered

up long strategy. How does this type of event affect a quant um is it is it the type of thing that you're just you know, as clueless as everyone else, or is you know, is there something about being a quant in the space that allows you to navigate it a little better. Uh. In general, yes, we I definitely believe we can navigate a lot of these incidents much more efficiently than than a lot of our I guess a lot of our comrades out there. But really, you know,

quant is non human. Uh. You know, it's it's looking at the data, it's it's trusting the data. And but you have to set up your system with a very risk oriented mentality. So you have to you have, the computer can can only be as good as as you let it be in those situations. And you can't just listen to everything that your your signals say. You know, you have to set it up so that you are mitigating risk. Do you always have to have multiple counterparties

in these this industry, you can't. You can't trade with just one one place. You also have to make sure that you have you know, we set maximums for any one counterparty. Um. So even though prices might be the best in trading, might be might be the most profitable with one exchange, We're not going to put eight of our funds there. We just we just won't. We're not willing to do that. And you know, so our portfolio has limits per per trading partner, it has overall limits

for signals. You know, we are a long short fund and our main fund, our system will only go to a certain percentage short, so you know, it doesn't matter what the market looks like UM, and if all of our signals wanted to short it, we still wouldn't short. We'd only shot up to UM the threshold percentage. So you know, you have to really make sure that your guard rails are set in place for for a quant fund. And then you know, having different strategies definitely helps. Having

a market neutral d FI fund helps in this situation. Having, you know, our d FI fund was you know, has you know so far been completely unaffected by this because it's self custodied UM using decentralized exchanges, so we don't have the centralized party risk of somebody mishandling our our funds without us knowing it. So the system, though again I'm just being repetitive, but the system is only as

good as as what you train it to be. I'm sure you guys don't want to sort of give up the ingredients of the secret sauce or anything, but I'm curious what sort of some of the main elements are of your strategies and I'm guessing trend following and momentum plays a big role. Yeah, and the flagship funds, you know, that's trects. We have systematic in nature, takes direction or

exposure both on the lawn and short side. We have a mixture of trend momentum, cross sectional momentum us really plain relative value across the assets that we trade, as well as some idiosyncratic signals that are that we found about unique market structure within crypto. UM you know, would pick up the bulk of the of the systematic fund and then on the market neutral with DeFi yield funds.

You know, that's largely driven by yield opportunities with a with a heavy risk overlay being able to hedge out, you know, crypto data exposure in uh you know, a crypto native way entirely on chain without having to interact

with centralized counterparties. So, Nico, can you actually talk more about your market neutral fund, because this is something I had been writing about over the summer when UM well and also earlier in the year we had crypto prices crashing in May and June and what market neutral strategies do is they tend to hold up better during those times. Right, So maybe can you just lay out for our audience what is the market neutral strategy and how is it

faring on during weeks like the one we just had. Yeah, so market neutral in this sense is we have some exposure to crypto price movement through the assets that we're holding within a variety of decentralized that change and other defy protocols. But then we utilize hedging strategies to net out that price exposure. UM. So that way, you know, if ethereum goes up, um, you know, our long holdings and ethereum go also go up, but are short exposure

goes down and it kind of nets out. There's more to it than that, you know, it requires real time rebalancing to account for impermanent loss and and other issues that arise onto centralized of changes. But in a nutshell, that's how it works. So does this event this week? Will it change your strategies going forward? Change the way

you do business? You know, it sounds like in a way you were, you know, sort of prepared for something like this to happen, you know, limiting your counterparty exposure and that sort of thing. But what's is there a lesson learned that that you'll carry for forward from this week's events. I mean, for one, we'll probably reduce our individual exposure anyone counterparty even more. Um. It gets difficult because there are not a lot of large exchanges with

good liquidity that you can trust. And then we've also started the very initial conversations of like around okay, do we take our flagship fund and only interact on decentralized options uh to to mitigate the central the centralized counter

party risk. Um. So that's early stage discussion. But because we run the market neutral DE five fund, we have all the technical infrastructure in place too, self custody our flagship fund and you know, only interact on uh, you know, on chain and Sadie, maybe you can just, um just to go back to the basics, basically, tell us more about you guys company, how you got interested in crypto, and maybe you can even fold in a bit about your background and Nicho's background, because you guys both have

very interesting, um sort of past lives before your your crypto lives. Sure happy to kind of give a little more color about our background. Um So I'm the co founder of strict Slevive and and UM originally founded the company with Jesse Proudman about five years ago. And I met Jesse when I went to work UM for him at his last startup, UM, which was a private cloud company. I was financial controller there. That company was acquired by IBM in so I stayed on led the integration of

the accounting and finance operations teams into Big Blue. Didn't really love UM going into a three sixty thou person company after being in a sixty person startup. And Jesse was a distinguished engineer at IBM, so he UM. You know, he ended up in their blockchain group and really fell down the crypto rabbit hole, as we all do. We'd

stay good friends. So I knew he was getting more and more into crypto and you know, dabbling and mining and trading UM, but then really really got passionate about trading and from as a technologist, felt like that was a huge opportunity UM. So approached me towards the end of seventeen and said, hey, I've got this business idea. UM, what do you think You knew that we needed to have structure and operations and legal and compliance. But that's all stuff that he finds UM as exciting as watching

paint dry. So he's like, hey, can you know, do you want to do this? I know that's kind of your wheelhouse. So that's how we started. I was really looking at trading in the space and you know, individually trading. Back at that point in time in crypto, it was impossible to capture any kind of UM gains efficiently. You know, you could see the price discrepancies across different exchanges, but by the time you could actually execute a trade, there

was no profit left in it. You know, you couldn't trade by a p I or if you did trade by a PI, you know, trades were dropped or double filled, or would look like they weren't filled, and then two days later they'd show up as completed. And so it was. It was just super inefficient. So UM we started a launch of fund um with actually Jesse as the main investor to start and some of his friends and then

m built the trading technology at the same time. UM launched the fund, the first fund in April ofen and by then realized that our technology was just as valuable UM as as our fund methodology was. So UM and stepping back a little bit. After we we formed the company officially in January, we realized we needed somebody with

much deeper finance UM skill set than we had. So that's where we were introduced through a friend to Nico and it was you know, it was as soon as we met Nico, we we knew like, this is this is the person that we're going to grow this company with. So um he joined really early on as well. So when you know, when we went live and April and bought our first bitcoin, which the price at that point in time was nine thousand dollars UM thereabouts. UM, you know,

Nico was there placed our first trade. So it's been pretty awesome to have him at the Helm since then. Yeah, Nico, why don't you why don't you take it from there? How did you end up in this rabbit hole? Uh? What's your what's your back story? Yeah? Absolutely, um, so high. I ended up in the rabbit hole of crypto as I used to be in the U. S. Military spense of time over in Iraq and Afghanistan. Um it was around two thousand and ten. I think it was the

first time I read about bitcoin. UM. I did not put everything I had into it, or I'd be retired on an island right now. But I was entirely fascinated by this concept of decentralized currency that had no intermediaries and no overarching control. I mean, it was very hard to sit in Iraq and looking around at the you know, the complete collapse of their infrastructure and not see the value add um, which is not as easily visible from the streets of the US where we don't have to

worry about those things. Yeah, what I'd like to rewind a little bit and get back to the idea of defy um. You know, as you point out UM, I feel like defy has a bit of a told you so a moment right now after what happens to a centralized, huge important player like f t x UM. So I'm curious, where are the opportunities in defy that are most exciting to you guys, and especially in the you know, the

notion of yield farming. I feel like that seemed to get pretty toxic after the collapse of of Terra and it's it's anchor program. UM. So what you know, is yield farming too risky these days? Or or there or their places where you know, it's still attractive. Uh and and sort of what projects what you know? Are you are you finding the opportunities in these days? Yeah, definitely,

hadn't I told you moment here, Kase. Everybody who operates on de FI is sitting with their own capital, in their own self custodied wallets and not worrying about some third party stirring off the their funds um and do any illicit things with it. Um. So definitely, and I told you so a moment. In terms of your farming, there's still plenty of opportunities out there. I mean, this is we're very early stages. I know at this point.

You know, Bitcoin has been around for you know, it's it's been almost thirteen years now since the White paper originally came out, But all of these additional use cases around the centralized finances are still in their infancy. So you know, if the trillions of dollars of global economy, even if it captures one percent of it, you know, the opportunity is still quite massive. Um. And so the opportunity still remains, and we're still pretty bullish on it. Nico.

Can you talk a little bit more about what you guys are doing right now? Maybe you can give us just a bit more specifics. I know, and the notes you had sent to us, which granted you sent before everything happened, but you said that there are potentially some areas in the space that are undervalued. So can you just tell us a bit more about that from an undervalued or overvalued perspective? Like one of the reasons we built the system we did on the flagship funds because

that is an impossible number to peg um. You know, she's bit coined, be a million dollars or a thousand dollars or less, like no one really knows, and it's dependent on future IDIO seeing credit events involving the decisions by governments all around the globe. So it's extremely difficult to you know, put a number on that. Undervalued in the sense that I think people are writing off DeFi after the last year year and a half because of the blow ups and the collapses and the amount of

money that has been lost is where things are undervalued. Um. You know, these systems are in therifancy, they're not user friendly, but if those problems get solved, you know, there's a ton of value in removing intermediaries and creating a more frictionless um you know, financial system. And again, you know,

this goes back to discovering this when I was in Iraq. Like, this means a lot more to somebody in Africa or the Middle East or other parts of the world, and it does to us sitting in America, Like, we're not I'm not particularly concerned about my bank going to zero dollars and stealing my money or the US government, you know, collapsing in the next five or ten years. But that is a really real concern for many people around the globe. What about all coins, because I think you guys also

were favorable towards certain old coins. Yeah, we are. I mean, you know, it's it's it's hard. I think this whole space will look very different in five years than it does today, and even more different in ten years than it does today. But we that stricts are not particularly fond of the idea that there will be one currency to rule them all. They think there are reasons that multiple currencies will continue to persist, and you know, we're

particularly excited about the DeFi ones. But you know, decentralized identity is another very interesting area that we're looking at UM and I think it's kind of necessary to take the next step in DeFi. So it's all inter related now, I know, is quantz. You guys have your heads in

the data and you know the algoes and everything. But I think what this week really hammered home for me, as as well as the collapse of Terra, is how important these sort of larger than life personalities can be in crypto, you know, whether it's FPF or do Quan and especially you know, these flame wars break out on Twitter between you know, Do Kuan and his critics and now, as you pointed out, Finance and f t X, and it's almost like this kind of machismo bravado alpha male

battle that goes on and really can cause some destruction in the in the whole space like we've seen. So Sadie, I'm curious how you think about that specifically. You know, uh, level headed woman, uh, surrounded by a bunch of bros, you know, duking it out on Twitter. How do you sort of incorporate the risk of all of that into what you do? Yeah, the story of my life being a bunch of bros, I mean, being a woman in

technology to start was was big enough. Uh, you know, lack of diversity, and then I went into crypto, you know, just because it wasn't bad enough. But you know, I have to say I don't work with Brose. I would not describe Nico or any of our team is rose thankfully they're fantastic. But I have five brothers. That's what I meant. He was, Yeah, that five brothers. That's a that's a lot of That's a lot of men in

one room. So really, I mean, Setoci Nakamoto had it right by by building this amazing, amazing ecosystem and then never revealing his, her or their identity, you know, not Setoci is not out there influencing what's happening UM, which is truly magical. Like that is the only reason I would want to meet them is to find out, like how did you when things have gotten so crazy? Sometimes

like how did you keep your mash up? But you know, I think some of these some of these projects where the influencers get a little bit larger than life and they get a get to you know, too focused on their social following UM and less focused on the business. That's definitely hasn't ended up being a good thing in almost any context. So you know, going forward. It's something to really kind of look at more of like, hey, who you know, is the head of this project getting

a little bit too influential? And the holy grail right now in crypto is valuation. You know what it what is? What are the fundamentals of crypto? What are the fundamentals of evaluating any specific crypto asset? And we just we don't have that. I mean in traditional markets, you you know, you have the c f A society and that's like we have experts basically who can value assets and um. In crypto, we don't have that. You know, there's just

everyone kind of uses a different methodology. Everyone has their own into mental methodology. But but when it comes down to it, there isn't really a tried and true valuation methodology for cryptos. So we have to use sometimes some of these more like I guess non traditional ways of evaluating a project, and you know, the who's leading it and how influential they are is probably going to factor into that a little bit more than maybe it would

have previously. You know, social there's a lot of strategies out there that use social social sentiment and social indicators. Um, you know, I don't I'm not saying we're going to go into that direction because we haven't before. But uh, it's uh definitely proven in the last six months at least to be somewhat of a negative indicator if the leader has um a little bit too much of a of a voice in a platform, and it definitely makes our jobs harder, I think for me and you, Mike

at least. But but on the on the flip side, it's those big personalities that also draw the capital and to begin with, you know, so it's it's kind of a dual edged sword. I guess. Yeah, that's good point. You know, you do need to have that charisma, you know people. I was talking to a VC investor recently, a very prolific investor here and Europe, and and his comment was, I just write checks to people, you know,

I don't even listen to their idea. If I like the person, I think they've got potential, Like I write that first check and and then I write the second check once I see how good their idea is. UM, So you do need that personality for for a lot of that money to come in. That's fascinating that that's the decision. No one would a single check filled out

on No, I never have. I certainly never would. But Sadie, maybe you can just talk about what some of the um in your what in your estimation are some of the unanswered questions that we still have with everything that happened with FTX. Obviously, the word regulation gets thrown around a lot, but it's not so obvious what that might actually look like. Do we potentially see more regulation of these centralized exchanges? And what else? Does? What else would

you like answers to? What what questions are out there that you'd like answered? Still, so I think really a lot is going to come out in the next week or two about and about the handling of the situation, you know, hindsight bias. We we can go back and try to figure out what what happened. Um, it would be really great to understand the Alameda um F t X transactions and how how some of that came came to be. You know, it would be great to understand a little bit more why Finance made that offer and

walked away so quickly. You know, there's there's a lot of rumors around that, and you know, but in the end, like I don't think we'll ever truly know, we're gonna know. You know, there's there's the famous quote, there's what I what I remember happened, what you remember happened, and then there's what actually happened. So we're going to get a lot of that, I think. But the underanswered questions are really how are they going to they how are they

going to deal with it? You know, we've got some examples of what I consider to be a really respectable way to handle a disaster like this, when with how Voyager has handled it. You know, Steve at Voyager I think is a very very admirabile person. It was really hard to see him go through that. But I feel like they have done a really great job of trying

to be as transparent with their customers as possible. Others who I won't say, they say because I don't want to say the names, all right, So Celsius is I think on the opposite spectrum where, um, you know, what they've done to customers is really hard to see, and you know, they I don't believe if cared that much how it's impacted customers, and the transparency just hasn't been there. So you know, I'm really hoping that this f T x sit oration resolves and that they can restore confidence.

And no, no matter what happens, I think you asked about regulation. No matter what happens, you know, regulation is coming. It's always been coming, especially for for people in the United States. Like if you want to be in the United States and stay in the United States and being crypto, you just have to know that regulations coming. It's just

a fact of life. And we might not like it in some aspects, but but it is there, and it is it is a protection for investors, right And you know, that whole narrative seems to have shifted over the years. You know it it seemed to be at first, you know, the lack of regulation in crypto was sort of a big selling point, you know, relative to the hundreds and

pages of regulation and traditional markets. But one thing that occurred to me this week is, and it's you know, I think it's occurred to others over the years, is that crypto seems to be stumbling into the problems that rad FI had solved with regulations in the past, as as annoying as those regulations can be. And one of them that really spring to mind to me this week is this notion that you know, well, what is uh SPFS empires an exchange? Uh, it was a trading shop.

And you know within all crypto exchanges, you know there's also basically a brokera gentleman as well. Where you know, should the regulations go where you know you're either an exchange, you're a brokerage, or you're a trading firm and not a combo of the threes? Is it too risky to sort of have all those businesses, uh, sort of, if not under one roof, at least under one sort of central control of an individual like SPF. So having separation

is kind of a basic principle of business. You know, really any any you know, SORR, Sarbanes, Oxley and and a lot of other um and you know a lot of other regulatory requirements really are focused on you know, business controls and segregation of duties. And you know, in a highly regulated industry there's still you know, moments where there's just that temptation to sort of well play in the gray areas, and you know, inevitably it tends to

hurt clients and retail customers and investors. UM. So I think there is inevitably going to need to be regulation. There's a tendency I think to overregulate in UM in situations where you don't understand the nuances of of an industry. That is one thing that I worry is going to happen right now with with what happened at FTX, I'm afraid that, you know, there's going to be a little

bit of a knee jerk reaction to overregulate. Some of those protections are really really important for for our investors. And you know, we've always been compliance focused and compliance first. We've never you know, we we have an in fully engaged compliance firm. UM. You know that's that's on call for all of our questions we UM. You know, we have two different legal teams that we work with, so we're always trying to make sure that we're playing within

the rules. But UM, there are a lot of people out there who who uh feel the opposite. And I know, you know, Sam Bankman Freed actually got hazed pretty badly recently for for being pro regulation. UM ironically, so go along lawyers is the way to play crypto. Well a rough week indeed, uh, Nico, I assume you're not ready to go back to Iraq after this week but Sadio, you tempted to go back to IBM after a week

like this? Um no, I do joke. That's my fantasy occasionally when I'm just like, I worked like a twenty hour day and I'm you know, the markets never stopped, and I'm like, oh, maybe I'll just go work for Amazon Like that just sounds like really relaxing, And then I just laugh. I'm like yeah, and in two weeks I would be going crazy. I mean, I love, love, love love the cryptal world. I love blockchain. I'm so

passionate about what we're doing. I love going to work every day, and I think I would absolutely go crazy if I ever had to take a job that was, you know, at a big corporation and wasn't playing in this space. Wow what a segue, speaking of going crazy. Wow, that's really good, right. I think she planned planned that? Did you plan that? Sadie? It is that time for the craziest things we saw in markets this week? Pretty normal week though, nothing crazier, nothing at all. I actually

have a million things. I have a one million crazy I'm gonna need you to narrow that down the one, maybe two if you got too many. I have three how about that. But one is from a listener, Brian. I hope Brian, I'm saying your name correctly. I always say that he flat to us that the Ontario Teacher's pension hadn't invested in FTX. That was going around Twitter as well, the Big pension invested in f Yeah. Yeah,

for mine, I had so Sam big mun Freed. There had been so much about how he was this grand billionaire. He had been worth something like twenty six billion dollars up until very recently, and he suffered midweek a drop to his wealth and he as of Wednesday, I think, had been worth somewhere around a billion dollars. On Tuesday it had been fifteen point six billion dollars and it was the fastest, the biggest one day collapse ever among

billionaires tracked by Bloomberg. And I think there's speculation that he might actually be a negative. Yeah, yeah, yeah, no for sure, but just the job is so so yeah. He should not go near any Ontario teachers. I would have a worried the entire Ontario school system. If how about you guys, what's uh slim pickings this week? I know, but what's the craziest thing you guys saw this week. So I was reading today about this jewel called the Fortune Pink, which sold at a Christie's auction is eighteen

point eighteen carrot pink diamond. Oh it's mine. If I put it, well, well done, you did well and that so it's sold for twenty point five million dollars. And I just kind of laughed a little. Well. I think it's funny because every time I'm trying to explain like n F T S two or crypto to someone and they're like, but how does it have value? And I'm like, well, you know, here's somebody paid twenty million dollars for a shiny pink rock, Like, I mean, how does that beautiful rock?

It's true, it's a it's a great that's a great comparison. I would say baseball cards. You know what's uh, you know, Babe Ruth, baseball cards a piece of cardboard. But you know what's the what's the value to a collector? So I guess a giant pink rock, especially that's got a tire hand out wearing that it tires my hand out a lot. Yeah, sure, I'm sure. How about Unico anything see this week? Yeah, you know, I was thinking about this, and I could not think of anything crazier than what's

already been a topic. But the CEO of one exchange tweeting out that they were going to sell half a billion dollars of another exchanges cryptocurrency resulting in a like eight hundred styled bank run that completely bankrupted FTX has got to be the craziest thing this week. I know, the whole the whole show is the crazy. I I give it to you, Dico. It sometimes the obvious, in plain sight is the winner. But I I think we're all kind of speechless after after this week. Wow, I'll

give you mine, I will say, Uh. The only thing that rivals crypto sometimes for for craziness is the art market. You know, I love the art market. Um So Paul Allen, the co founder of Microsoft past way and his estate sold his art collection. So the donna do not look over at my notes Here're not looking. Don't look in no peeking. But it's time and I regret to inform you, Sadie Nico, you're now consistants on our little game show here called the prices precise not the price is right.

This is different but the same with yes, the Bullmarket for Lawyers insists that we changed the name. What do you suppose the total value when it went up for auction at Christie's on Wednesday evening? Total value for Paul Allen's art collection? How many pieces are part of it? Sixty artworks. I'm gonna go with two hundred and forty eight million dollars million dollars. That's a very precise price right there. It's a we're playing prices for eight million. Okay.

The other two contestants, Sadie, what's what's your guests on Paul Allen's art collection? So I believe I've heard from a couple of people that he was had really great taste in art, or he had like quite a collection. Um, so I'm gonna I'm gonna go much higher. I'm gonna say you your b is in the books, Nico. This is your chance to show up the CEO here and prove why you deserve to be the chief Investment Officer. What's your what's your bid for Paul Allen's sixty piece

art collection? I remember price prices precise roles are similar to another game show you might know. So you could go one dollar, you could go one dollar above the highest highest bid yep, yeah, I'm gonna go with alright, alright, you're all away off the mark. But Nico's closest one point five billion dollars for Paul Allen's art collection is that nuts one of the biggest ones. Birch Forest by Gustav cli Clints. I hope I'm saying that hundred five million,

one point five billion, that crazy. Yes, I bought it all. By the way you hawk that diamond. Yeah, I was walking on with my diamond, with my pink diamond, and yeah, now you need a bigger apartment to display at all. Yeah, Sadie and Nico, we can't thank you enough. I know it must have been a stressful week for you and you probably, uh, the last thing you wanted to do was rehash it all on a podcast, But we really appreciate you taking the time and helping us understand what

a crazy week it was. Yeah, thanks for having us, absolutely, thank you for having Yeah, thank you guys, what goes up. We'll be back next week and so then you can find us on the Bloomberg Terminal website and app or wherever you get your podcasts. We love it. If you took the time to rate and review the show on Apple Podcasts so more listeners can find us, and you can find us on Twitter, follow me at Reaganonymous, Goldona hierarch Is at Bldona Hirach. You can also follow Bloomberg

Podcasts at podcasts. What Goes Up is produced by Stacy Wong. Thanks for listening, See you next time.