ROLLUP: Trump Tariff Crash | Circle IPO | CoreWeave IPO | FDIC Crypto Greenlight

This week, Alex Thorn joins us to unpack Trump's shocking tariff announcement that sent markets plunging and investors scrambling. Circle files for its IPO, revealing surprising financials, while the FDIC gives banks the crypto green light. CoreWeave debuts with a blockbuster IPO, and Eric Trump dives deeper into Bitcoin mining. We cover all this chaos and more in this week’s Weekly Rollup. Follow Alex on X & check out his Galaxy Brains podcast: https://x.com/intangiblecoins https://www.galaxy.com/insights/podcasts/galaxy-brains/ ------ 📣SPOTIFY PREMIUM RSS FEED | USE CODE: SPOTIFY24 https://bankless.cc/spotify-premium ------ BANKLESS SPONSOR TOOLS: 🪙FRAX | SELF SUFFICIENT DeFi https://bankless.cc/Frax 🦄UNISWAP | SWAP ON UNICHAIN https://bankless.cc/unichain 🛞MANTLE | MODULAR LAYER 2 NETWORK https://bankless.cc/Mantle 🌐CELO | BUILD TOGETHER AND PROSPER https://bankless.cc/Celo 🏦INFINEX | THE CRYPTO-EVERYTHING APP https://bankless.cc/Infinex ------ TIMESTAMPS & RESOURCES 0:00 Intro 0:29 Trump’s Reciprocal Tariffs https://x.com/kobeissiletter/status/1907556839686054240 https://x.com/WhiteHouse/status/1907533090559324204 https://x.com/CalltoActivism/status/1907549193650188469 https://x.com/notlouisck/status/1907657906117554278 https://x.com/JamesSurowiecki/status/1907559189234196942 https://x.com/KushDesai47/status/1907618136444067901 https://x.com/TrustlessState/status/1907769359621067017 36:53 Circle Files for IPO https://x.com/Cointelegraph/status/1907172102353924269 https://x.com/g_djuric/status/1907200843289370910 https://x.com/Nick_van_Eck/status/1907181670504993026 https://x.com/TheOneandOmsy/status/1907229821043626100 https://polymarket.com/event/circle-ipo-in-2025?tid=1743435443834 54:32 Eric Trump & Bitcoin Mining https://x.com/EricBalchunas/status/1906689372142915712 https://x.com/FDICgov/status/1905662427783467111 58:07 CoreWeave IPO https://www.galaxy.com/transactions/coreweave-growth-financing 1:04:47 Closing & Disclaimers ------ Not financial or tax advice. See our investment disclosures here: https://www.bankless.com/disclosures

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:04David Hoffman?

  Bankless Nation, welcome to the weekly roll-up. Each week I'm bringing on a different co-host to help me go through the news. And this week, I have the pleasure of being joined by Alex Thorne, Head of Research at Galaxy Digital. Happy Friday, Alex. Happy Liberation Day. Do you feel liberated today?

• 0:17Speaker 01

  I feel liberated from my stock gains, David. But yes, Happy Liberation Day. Thanks for having me.

• 0:22David Hoffman?

  We are going through some of the most chaotic news events in recent memory, at the very least, maybe marked by this extremely iconic photo that I have up on the screen of Trump holding what looks like a photoshopped board in his hands, but it is actually real. And it is a poster of reciprocal tariffs of just basically every single country in Under the Sun. And so we'll kind of go through some of the facts and I'll get your takes on it, Alex. So yesterday, April 2, Donald Trump declared Liberation Day by announcing a series of significant tariffs aiming at reshaping US trade policy. These measures included a 10% universal tariff on all imports with higher reciprocal tariffs targeting specific countries based on their trade practices.

• 1:07David Hoffman?

  For instance, China faces a 34% tariff. The European Union has 20%, Japan has 24%. So some of our largest United States trading partners got hit with tariffs that are much higher than I think anyone could have reasonably expected. And Trump just touted this as just the new dawn for America. While this was going on at 4:25 PM, like five minutes before markets closed, the S&P futures were trading at 1.7% higher. And then by 4:42 PM, just under 20 minutes later, the S&P 500 had erased over $2 trillion in market cap on the news of all of these reciprocal tariffs. All the tariffs that are being announced by this Liberation Day announcement,

• 1:52David Hoffman?

  over 180 countries are being impacted, which is like all of them. And then there's also sector-specific tariffs, mainly the automobile industry. The idea, the strategy, the stated strategy by the White House on these tariffs are, one, a decrease United States dependence on imported goods, which Trump is citing as a national security issue. He wants to boost domestic manufacturing and jobs by encouraging companies to relocate production into the United States. He wants to address trade imbalances by penalizing countries that he thinks are engaging in unfair trade practices like currency manipulation or high foreign tariffs that disadvantage American exports exporters. And then also, he wants to generate revenue so that he can fund domestic tax cuts.

• 2:35David Hoffman?

  Like I said, stock market futures fell in real time as Donald Trump was reading off some of these tariffs. Crypto hasn't been impacted too much. We are definitely down. Bitcoin's down 3% to 82,000. Ethereum is below $1,800. But I would say the stock market continues to decline while crypto is just refinding lows that it has already seen. Alex, what's your digestion of all of this news? What's your take?

• 3:03Speaker 01

  Yeah, it was a volatile day yesterday, right after the close, right? The president started talking in the Rose Garden at 4:00 PM. So traders, investors everywhere, including here at Galaxy and on our trading floor, very rare, but the biggest sort of moment of the day was after equity market close. Look, the dollar traded down to start and then risk traded up. Bitcoin went up to like 88.5, right? So again, still sort of in that range. I agree with your point here that even at these levels of 1777 and 82.1 where Bitcoin is and where Ethan Bitcoin are, like, still kind of in the chop range we've been in. I wouldn't say it's like a, it's not yet something that's like wildly outside of the range we've been trading in.

• 3:46Speaker 01

  But anyway, as Trump held up that poster that you were showing, that's when you saw the risk reversal happen. And I mean, Bitcoin dropped from 88 to 85 in about like 30 seconds, dropped down later, kept dropping. That's when the, you know, the S and P futures and other risk futures, I mean, big-name FAANG stocks or MAC7s were down, you know, almost, you know, 5% to 10% after-market trading. And it's because the board that he holds up.

• 4:18Speaker 01

  This has become clear now, they aren't reciprocal tariffs. Those numbers are effectively the trade imbalance between our countries and those countries.

• 4:29David Hoffman?

  Is a completely different number than tariffs.

• 4:33Speaker 01

  Yes, these are trade imbalance times point oh five. So, or if that formula results in less than 10%, 10%. So it's actually solely the difference in our imports and exports with those countries, which is typically significantly higher than expected the tariffs would be. So what we thought we were gonna get was that they went country by country and said, okay, on corn, like, I don't know, India, you tariff us 50%, so we'll tariff you 50% on corn, or generally, or whatever, right? Or if it's a non, he kept talking about the non-monetary trade barriers. Oh, okay, you don't let us bring in our corn, right? Well, then we're not gonna let you bring in your corn. And that it would be matched like one to one with the actual, you know,

• 5:17Speaker 01

  actual reciprocity between what these countries are tariffing us. And it just doesn't look like that's what they've done. They've instead done sort of classic protectionism here.

• 5:26David Hoffman?

  Yeah, I think this is the thing that is really confusing and frustrating investors, policy people, because there's no coherence in like why we are doing the action. So Trump, Trump wants to impose tariffs and his justification is reciprocal tariffs. But what they are actually measuring downstream of this like interesting calculation that there was some drama on Twitter about, which we'll talk about, is actually, it's just a trade imbalance is the motivation behind these crazy high tariffs. And the stated actions is not actually lining up with the words. And so this is maybe to go through some of the drama that was on Twitter. Everyone was confused about the numbers going on behind these boards, right? Tariffs charged to the United States, China, 67%.

• 6:10David Hoffman?

  European Union, 39%. Vietnam, 90%. And people were confused about like, how did they come to the conclusion of what these tariffs are? Because the actual average tariffs charged to the United States are something much lower. Like China's actual is something around 7.5%. European Union, something around 5%. And so what they realized- This this kind of just reverse engineering the the math is exactly what you said. The the math going into this is something much different than any sort of tariff input. It's actually just looking at the trade imbalances and saying that, oh, if there is a trade imbalance, we are going to increase the tariffs. And so it's fundamentally going after trade imbalances, not any sort of reciprocal tariffs.

• 6:51David Hoffman?

  But this is is there's just a gap between the actual stated rationale versus the end number, which is just confusing everyone as to like, what happens next? How do we respond to this?

• 7:04David Hoffman?

  I know Switzerland made a statement as basically to the effect of, we don't know how to respond because this is incoherent. And I think that's also kind of the sentiment of domestic investors as well.

• 7:16Speaker 01

  Yeah, some some early responses. EU preparing retaliatory tariff measures if talks fail. China firmly opposes tariffs will respond. Japan calls terrorists regrettable, seeks exemption, promises swift action. Germany calls for the EU to pressure Trump. South Korea orders emergency support for their affected industries. Canada vows strong countermeasures. Some exemptions remain. Mexico rejects tit for tat tariffs and plans a broader response. UK is seeking a trade deal but keeps its options open. Australia will negotiate avoids counter tariffs. Brazil evaluating responses might go to the World Trade Organization. Israel planning measures to counter 17% tariffs. So like it's rippling out and I agree like if the, you know, we do have trade imbalances, right?

• 7:57Speaker 01

  Like we are often net importers because of the the Triffin dilemma, right? It's the it's the global reserve currency. We are net exporters of dollars and net importers of goods like. And that is sort of the price you pay to be the global global reserve currency. And and wanting to reverse that is, you know, could be a noble policy goal, but it isn't exactly what the president has been saying he was gonna do. He was saying that we were being unfairly taxed. Like, why would we have to pay, you know, inbound tariffs to some country if they're not paying them to us? Right? Which, you know, they're they're related. The the there those are related topics. But solving for the trade imbalance is different than, you know, retaliating for these unfair trade practices that the president has been talking about.

• 8:39Speaker 01

  So I think that that, you know, the difference between why he was saying he was doing it and then what he actually has done so far. It's not clear that they have actually. I don't think they take place yet. I think some start April 5th, which is what Friday or Saturday, Saturday, I guess. And some start April 9th, which is like early next week, like. Um, maybe they won't start. I mean, I don't know, but basically that that disparity, I think, is what really accelerated the the sell off and and the fears about risk assets. Because, you know, there was, I think, a a view forming that maybe Monday was of this week was peak tariff FUD, that basically this could be a, this could be a, um, sell the rumor, buy the news event, if like, because they have been signaling about the tariffs

• 9:21Speaker 01

  for now months. So it's not like it was new information. But then I think, I mean, I don't know if this was a mistake, if they did the messaging poorly or what, but they really did sort of drop a bomb with this, like, different math than was expected.

• 9:33David Hoffman?

  Yeah, this, uh, just a very large, like, gap between the tariffs charged.

• 9:38Speaker 01

  I'm just laughing at that. That is a great photo, though. That's a great photo.

• 9:40David Hoffman?

  This is an iconic photo. Again, this is Donald Trump just holding off, holding up this board. Um, eh, like I said, it's confusing to investors because the math going into the tariffs charged to the United States number is not correct math. And also, there's just some fundamental inconsistencies about Donald Trump's motivations, right? Like, if this is just posturing, if we are posturing as the United States to try and just come up with a very large sticker shocking number about large tariffs into the United States to use that as a bargaining chip, that is a short term bargaining chip. But if Trump wants domestic manufacturing to return, if he's trying to incentivize Nike to build and, you know, manufacture their shoes in the United States, that is a multi-year-long

• 10:23David Hoffman?

  transition. Like, that doesn't just happen overnight. And so there's some timeframe dislocations here that don't really line up. Um, and overall, I think, like, one of the reasons why stock markets are just taking such a big hit right now and also continuing to go down is that this is just very hard, this is even more uncertainty when there is just a chaotic input into the calculation that people can't really understand how it really got there. That is just uncertainty into the market. And if you look around crypto Twitter, this is a Geiger Capital, who is a commentator around, like, general markets. Uh, he says, I won't delete this tweet because I'm a man of honor, but yes, I was wrong on the tariffs in November. He has indeed put blanket tariffs on every country. Trump 2.0 is very

• 11:07David Hoffman?

  And he is retweeting a tweet that of him saying, no one other than fairly stupid partisans on the left think Trump is going to implement 20% tariffs across everything on the board, which turns out to be exactly more or less what's happening. And I kind of think that this is sentiment that everyone who is looking at the stock market sharing right now is no one really thought that Trump would actually go this far. But he is indeed going this far off of inputs that no one could have really like predicted or seem comprehensible.

• 11:34Speaker 01

  That's right. That's right. And the surprise, the surprise on the inputs yesterday, I think it became pretty clear that he was going to go pretty blanket over the last month or two, right? Like it was not maybe clear in November to Geiger Capital's point, but again, the surprise of the math is, I think, would really spook the market here like. And I mean, you're looking at the, you know, the major equity indices down, I mean, 5% I was looking at as we record this, like on a daily.

• 12:03David Hoffman?

  It dropped open down 3%. The SPX had dropped 3% on the open and since open, it has dropped another percent and a half. So we are down 4% on just the SPX, S and P 500.

• 12:14Speaker 01

  Yeah. And I'm looking at NASDAQ is down 4.8%. I mean, this makes it a, I don't have the numbers in front of me, but it's certainly one of the, you know, reddest down, biggest down days in, in years. So, um, you know, I, I don't know what to make of it. I think this is, I think people were thinking that, um, like I said, that perhaps like peak FUD had already occurred. And that if, you know, it came out and did, you know, something sounded angry, but was to stake out a negotiating position, to your point, posturing that like, maybe we had, had priced in the fear about tariffs. But it just, you know, we're, we're still having it priced in for us, basically. So I, you know, you're looking at a very uncertain, like next couple of months for sure.

• 12:56Speaker 01

  Not just in risk markets, but also in the American economy, right? Because there's also been. You know, some tricky data here, right? You've got the Fed, you know, discounting, lowering its GDP forecast. You've got weak manufacturing data. You've got high, like, delinquencies and, and credit delinquencies and mortgage delinquencies. And you've got like, so, so there is material weakness appearing in the US economy outside of the markets, too. So you've got this, that's a tricky situation, right? And, and meanwhile, you've got Besen and Trump basically saying, we're not looking at the stock market right now in the short term. And, you know, I was at a, I was at the Cherry Blossom Summit in DC on Monday, which is

• 13:38Speaker 01

  a private conference hosted by Senator Bill Hagerty, where Besen talked. And he said that the stock market is like a micrometer of the, of sentiment. It shouldn't be paid too close. I mean, he's, they're downplaying what, like, this day that we're talking about, where stocks absolutely risk reversed huge. They're, they're downplaying still. So there, it doesn't sound like they're close to, you know, the pain that they, that they know the economy, the markets need to feel in order to get rates where they need to be and to sort of work on things like the deficit. There's more they can bear, is what they're signaling. And, and to me, I think that's really what the market is going to be hunting out here. Like, will they bear a 20% stock market decline? What's the number, 30? At what point is it too much to bear?

• 14:22Speaker 01

  And nobody knows yet, but they're holding pretty strong for now. So I, I wouldn't expect any kind of like dovish language coming out of Treasury or Commerce or the White House anytime soon.

• 14:33David Hoffman?

  Yeah, I, I think that investors are looking at Donald Trump's statements and his actions and his words and are trying to ascertain, do we take this man at his word? Or is he trying to play 3D chess? Like, is there a hidden agenda behind the scenes? Or when he says, I like tariffs and I want to implement, you know, broad 20% tariffs across the board. Do we take him at his word? And like granted, if you go back to the eighties, you can go and find Donald Trump like, uh, like records of him talking about how much he enjoys tariffs, how much he wants to tariff other countries. It wasn't China back then, it was Japan was like our big like foreign, um, domestic, not a foreign like trading adversary.

• 15:16David Hoffman?

  Now it's China, but he has been like very consistently into the concept of tariffs for decades now.

• 15:23Speaker 01

  Yeah.

• 15:23David Hoffman?

  And he is very simply saying, I like tariffs. I want to implement very high tariffs across the board. And now he is following through with that. And it seems to be if you are an investor who literally just takes Donald Trump at his word, not assuming that there's actually a 3D game being played behind the scenes. That is actually has been the correct way to interpret the markets. Uh, ever like almost the entirety of Donald Trump's position, both in this, um, administration and the last time he was president.

• 15:51Speaker 01

  Yeah, I, you're right. He has been, there's actually fascinating quotes from him in like the eighties talking about this. So, look, I, I think in that sense, it is fair to say that like he is basically doing what he said he would do. I just, to your point, I don't think people really believed that he was gonna do it. And, and now the market is wondering, you know, how long can they keep this up basically? And, and they're saying they were gonna hold strong. So I, I don't know. If you read The Art of the Deal, which I did go back and read, I think Trump is pretty clear about his strategies generally to ask for everything. Right? To come out super hard with an implacable position, but he almost always caves and does a deal.

• 16:30Speaker 01

  And so like you have to assume at some point, something gets done with the, with all of these countries to, you know, reach some kind of, at least an accommodation where we're no longer tit for tatting, right? Cause like we're now expecting retaliation for a lot of these tariffs. And then are we gonna retaliate on that? And like you're, that is why it's called a trade war. Like it escalates like a kinetic war, right? So at some point, I assume we will get to a stasis here where we stop just, you know, one-upping each other. But where that is, I mean, and, and that's the thing too, by the fact that Trump is very focused on the manufacturing industry and domestic, you know, production, which I respect, like I, there, we have hollowed out our domestic manufacturing in the United States. And like I said, it kind of flows from the global reserve currency by nature.

• 17:15Speaker 01

  It's kind of natural that that can happen. But wanting to repair that is different than being complaining about the unfair practices we've been subjected to. And it really does look like he is much more serious about, he does want to change the trade imbalance. That's actually what he wants to do. He wants America to build more, and I respect that, but this is, that is where the messaging here was confusing, I think, because this, those numbers that he's proudly holding up, and you're right, people were literally brute forcing the number to try to figure out where he got these numbers. And the White House, I saw that thing, the guy James, whose tweet you showed that did figure it out, he put it to the White House Deputy Press Secretary, who sort of, it almost

• 17:58Speaker 01

  seemed unbeknownst to that Press Secretary, admitted that that's what they did, basically. So now it's confirmed that that's what they did. This is actually tariffs that are taxing the trade imbalance. They're not tariffs that are reciprocal for those against us.

• 18:13David Hoffman?

  Yeah, so this was kind of the drama that was going on on Twitter. People were reverse engineering how we got to the numbers that is the calculation for what we think is our, the tariffs being charged to the United States by our foreign trade partners. And people figured it out, that it's actually just, if, what is that calculation? It's something very simple. You just.

• 18:36Speaker 01

  It's literally just like import, it's the ratio of like imports to exports, and then they found that they just multiplied it by 0.5 to reduce it. So it wasn't as big, right? But like.

• 18:45David Hoffman?

  So on Twitter, Kersh, Kush Desai, who's the White House Deputy Press Secretary, is declining, is saying like, no, we actually literally calculated tariff and non-tariff barriers. And then he tweeted out a link to the approach, including this like algorithm, this like, this just algorithm, it's basic algebra with some figures in there that go in into this number. And then people all look at this Greek letter, algebraic equation and be like, yes, that's exactly what we are saying you guys did. You guys just did it in Greek letters. And trying to like make it super like genius level IQ, but in fact, no, you guys are just admitting that the reverse engineering of what we did. Exports minus imports divided by imports is actually exactly how we came to it.

• 19:30Speaker 01

  So, and look, the market had been even before, this is really a strange, by the way, this is among the best like hive mind. This is like where social media and the internet was at its best, I think, figuring this out. It's a great example of like. Just absolutely figuring it out and telling truth to power, basically getting it confirmed. I mean, we, we considered this tweet from the, effectively confirming what they did, right? So like now we, it wasn't just people on Twitter reverse engineering. This was legitimate journalism that ended up happening. Very exciting. I, I think the big problem with tariffs, right? Like is that they, they, they broadly reduce global efficiency, right? They are taxation, right? Either we're taxing them. Question of who pays is always the question, but like typically the foreign manufacturers are going to end up selling,

• 20:14Speaker 01

  adding the cost of those tariffs back to the goods they produce and sell to us. So like, there's plenty of historical evidence of tariffs that we impose actually being paid for by American consumers, right? Ultimately, like the, like, just like taxation in general, when you tax a corporation, oftentimes they'll just pass the cost of the tax down to their consumer if they can, right? So that, that is always the big question. The raising the revenue is, ends up being both, um, you know, taxi, tax for everybody. It also reduces the global efficiency. It's in general, it's stagflationary because, um, it's more deflationary for the tariff, the tariff to producer, but it's more inflate inflationary for the tariff imposer, right?

• 20:55Speaker 01

  So it, it creates a situation where we're, we will see inflation in sort of the CPI sense, right? Not like monetary debasement, but, um, cost of goods will go up, right? And I'm already saying, telling you that like employment data hasn't totally turned, but like manufacturing looks shaky. Like the US economy, labor data doesn't look that good. By the way, the government, which I think the federal government has like two to four million employees and they're firing a lot of them. Right? Like, which again, might be a good thing, but those are people that now become unemployed. And that's a lot of people. And these are not, for the most part, like very low paying jobs. They're, they're not bad jobs in terms of salaries.

• 21:35Speaker 01

  So like, you've got all those people now with less money to spend, um, you, that may seek unemployment benefits that have. You know, their credit, you've got student loan stuff is now going to start hitting people's credits. There had been a moratorium if you didn't pay your student loans on it affecting your credit score, but that's now being lifted. So you're going to get millions of people whose credit scores drop like 100 points, right? That's going to be less purchasing power. So all of this combined with the possible inflationary nature of the tariffs are what people, this is all what's creating that risk atmosphere. But I think yesterday, like we've talked about, it was a shock about that number situation, but like still, it doesn't, we're still just in this period where you're looking at a possible stagflationary

• 22:15Speaker 01

  economic situation. And you know, cryptos like Bitcoin and Ether just sort of like in the range trying to, they're kind of along for the ride right now. These are macro assets at the moment.

• 22:26David Hoffman?

  Yeah. Here's something that, here's what I think that is a problem about this strategy. I think the strategy of bringing manufacturing home to the United States is a noble goal, and that is something that has been persistently a growing problem of America. Like you said, due to the Triffin dilemma, we export dollars, we export financial services. We don't do a very good job exporting manufacturing product like shoes. And if you go and look at this like reciprocal tariff, the board that Donald Trump is holding up on screen right now, Cambodia, we're hitting them with a 49% tariff, Malaysia, 24% tariff, Indonesia, 32% tariff, Thailand, 36% tariff. These are all textiles, and this is where, this is why Nike stock

• 23:10David Hoffman?

  is being hit like negative like 12% on the morning, I think. And if the goal is to convince Nike to move their manufacturing onshore, that means that Americans are going to get those jobs. But I would contend that that's not jobs that Americans really see themselves enjoying. Because that can't, like, what is the salary cap on somebody who's working in a Nike shoe manufacturing facility that's on, like, at some point, Americans just aren't interested in that kind of job. In addition to that, like robotics is going to take over. Like, we're going to automate that job, much more than we're going to be able to afford

• 23:51David Hoffman?

  a United States citizen, you know, making Nike shoes domestically. And so the, again, the idea of moving manufacturing onshore is noble. I do not think that this is going to have the desired outcome of simply taking like Nike factories and putting it in like the Midwest or somewhere.

• 24:07Speaker 01

  Yeah, it's a really good point. I mean, the automation and robotics is also a good point. But I think you're, the question you're asking about, you know, do Americans want these jobs? Or do they see themselves, I think actually isn't a very important, is a very important question. And I think when you have decades of your economy focused on sending everyone to college, you know, thinking about things like technology, IT, like finance, right? Medicine, like these big, you know, everybody, it's sort of like a multi-generational thing, right? Like my grandparents came here in 1956 from Hungary and they were just happy to survive, right? They wanted to give their daughter, my mom, a good life. And they did, and she, she had to try hard, but, but then the millennial generation, which I am a member of, and I think you are too, David, right?

• 24:52Speaker 01

  Um, we, our parents kind of wanted us to have everything, right? And so like, and, and, and as you cascade away from, you know, World War II and the boomers and all the struggles that, you know, they were satisfied doing, you know, having freedom. They, they probably are much more likely to, to, you know, you know, manufacture shoes. But our generation, you know, take it three generations later of all of that exporting and sort of high intelligencing of our economy. And you've got now like people whose parents also probably weren't making shoes, right? Like it's, you're, you're removed from that manufacturing base as a culture and as a, and generationally. So I, I think that you look at it like all the people that take out enormous amounts of debt to go to college and like, I went, we went to college, like, it's not that, like, helpful.

• 25:37Speaker 01

  I mean, it was fun. I learned a lot, I guess, but like, I'm not using like that much of what I learned in college in my career. And I think if you get a liberal arts degree, which so many of the student loan holders have, like, is that they, but they were told like, you have to go to college, you have to go to college. And so like, you're, you're looking at it, this could take a long time, right? To re-architect the economy, to explain and exalt the, the nobility and the career advancement opportunities of the trades, right? Of manufacturing, like the, the country, a large parts of the country are not prepared to realize, and by the way, ask your HVAC guy or your plumber how much they make. If they tell you, I think you'll be surprised, it's a lot.

• 26:21Speaker 01

  So like, these are great jobs, but like, you know, or, or even like, you know, manufacturing high-end goods, I mean, that like, they're, they're not low-paying jobs, all of them. Maybe, you know, some are maybe, but like, um, But the country like has been for at least like, I don't know, at least since like 1990, it's been like, ah, like hammered into every child that they have to go to college, right? And like, but the college jobs aren't the ones that are in domestic manufacturing. Like, you don't need a liberal arts degree to work at US Steel, like, you know, and that's okay. I'm saying that's like a good thing. You really shouldn't, like, what do you care about, like, you know, reading, like, you know, poetry and stuff if you're gonna be building stuff with your hands? I'm saying it's a different trade, right? And like, the

• 27:04Speaker 01

  US is not really like culturally architected around the trades like we used to be. And I, I think that is something that really makes this tricky as well.

• 27:13David Hoffman?

  I think the, the last point of conversation I want to bring up when we talk about this, Liberation Day. Yeah, the United States, we represent 26% of global trade. We definitely punch above our weight class in terms of how much trade we represent across the entire globe. 26%, just from one country, that's us, you know, USA. It's not a majority. It's one quarter of global trade. And Donald Trump is playing these, making these moves, make it with the, in my opinion, the appearance that we have a lot more leverage than we might actually do. And I'm worried that we don't have the global trade dominance to just slap hairy, heavy tariffs on the rest of the world. Because that's what we did.

• 27:57David Hoffman?

  180 countries that we just put at least minimum 10% tariffs on, that's all of the world. 180 countries is all of the countries. And it really just seems to me that the rest of the world is just gonna trade around us. Like, we don't have that much of a bargaining stick that I think Donald Trump thinks that we do. And I think the next part of this conversation comes from, how unified will the response be from the rest of the world? We already see the EU is responding as a unit. That's what the EU does. We also saw Japan, China, and I think one other country respond as a unit. So-

• 28:35Speaker 01

  South Korea.

• 28:36David Hoffman?

  South Korea. How well the rest of the global unify against the United States, I think is gonna be the next like course of action to watch here.

• 28:44Speaker 01

  I agree completely, and I'll keep it short, but I, I think you are absolutely right. That, by the way, that China, that was from Chinese state media. I saw that headline. So I'm not, not discounting it, but China- If it's true that Japan and South Korea, huge US allies, I mean Japan, possibly the single most important US ally, right, they literally own most of our debt, or they are by far the largest holder of US sovereign debt. If it's true that they are going to act in concert with China, like, that is a massive deal. It's, I would say, very bad for American geopolitical positioning, because it means that we are pushing our allies into the hands of our antagonists, right?

• 29:23David Hoffman?

  I think China is stoked right now.

• 29:25Speaker 01

  I mean, yeah, look, everyone's mad at us right now, right? Maybe a nice change, or like, I mean, I agree, I think, there's, look, a big takeaway, regardless of whether the goals are noble, or whether the tariffs will work, or whatever, whether it's reasonable to do, or whether it's disruptive, many of the answers to those are yes, by the way, or no, you know, like, but this undeniably accelerates the multipolar shift happening in global geopolitics, right? Like, this is going to force a realignment, this and other policies of this administration. And again, maybe some, maybe that's good, I'm just, but I think it's very obviously a multipolar world, and it's very obviously going to further deteriorate into blocks,

• 30:10Speaker 01

  right? And, you know, we do have the most purchasing power, we still have the best market to sell your goods in, so there is some leverage there, for sure. But, you're right, we're daring people to find other markets, right? I mean, that's what we're effectively doing here, and they might. So like, that's, that doesn't mean America won't be powerful, or even still maybe the most powerful, or even the biggest or best economy, we probably will be for the foreseeable future, but it does mean that our influence is gonna wane, right? Like, by choice, I mean, that's what we're saying, America, that's what America First means, is that like, we don't want to have that influence anymore, we want to focus our energy at home. It's just a big idea, I don't think people are, he is following through on it, and that

• 30:55Speaker 01

  is a, this is about, I mean, you're, if you think that the Cold War ended in 1989, right, and then the sort of Goldilocks period of American empire ended in 2001 on 9/11, and then we sort of entered this, you know, we had the war on terror period, and then like the, you know, and then COVID, like, we, this is definitively the start of yet another new era, is sort of my point, the sort of post-war Everything on monetary policy can be true on Bretton Woods, probably, right? Like, the post-war order from World War II is over.

• 31:26David Hoffman?

  Yeah, maybe the last comment I'll make before we move on to talk about the Circle IPO. There was a quote going around from Donald Trump ahead of the actual Liberation Day. Like, actually, they're talking about the tariff numbers, was that he said something to the effect of, "The globalists are not going to be happy with what I have to say on Liberation Day." That's a huge paraphrasing, but that's what he said. It's like, "People are not going to like what I'm about to announce, and they're all globalists." And he's like positioning anyone who's unhappy with this as a globalist. And kind of just trying to nip the criticism in the bud, saying, "Hey, if you're not happy with this, you're just clearly a globalist who's not putting America's interests first."

• 32:09Speaker 01

  I'm not even necessarily opposed, to be clear with what they're doing. I find the volatility exciting. Fuck it, you know? Something does need to give on the deficit.

• 32:17David Hoffman?

  There's like something I kind of like about it. I just don't know the outcome.

• 32:20Speaker 01

  Agreed. It's uncertainty, and that like, you know, people are investors. Your listeners are investors, so I get it. Like, and so are my clients, right?

• 32:28David Hoffman?

  Right.

• 32:28Speaker 01

  But something's got to give, honestly, on the debt and the deficit. I respect their trying, honestly, because like, we have no ability to have long-term thinking in this country because of the electoral process. And so like, it's nice that someone's finally going to try something different. It'll probably fail, and in like three years, they'll just reverse everything, and then we'll go back to normal. And we'll just rack up debt to 100 trillion, and that'll be that, probably, but like...

• 32:48David Hoffman?

  Yeah. At least someone did try and stop the debt burden. And that is, yeah, because like, it goes again, something to this, what's going on here is something that like, Bitcoiners have said will never happen in government leadership, which is like, they will never do austerity. Why will they ever do austerity? Because we can just keep on printing money. And this is exactly the opposite of what...

• 33:10Speaker 01

  It is. It is. It's actually shocking. And I don't think the Bitcoiners were wrong to say that, but I mean, like, this is why I am...

• 33:16David Hoffman?

  This is the exception.

• 33:18Speaker 01

  That's why I think to me, the question is, I think people are willing, investors too, macro investors, dude, everybody made a shitload of money last year in almost every asset class. So like, you know, except for Ethereum.

• 33:30Speaker 01

  Well, I'll stop, I'm just saying, but that's why Pete, the real question is how much pain is the market really willing to bear? How much leash are they gonna really give them? At some point, it's gonna turn, like, and right now, they're still giving them a little bit, but anyway, that's the, that's the message.

• 33:44David Hoffman?

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• 36:41David Hoffman?

  Apps validate your proofs instantly on-chain like on Cello or off-chain. Audited by ZK Security, the SELF app is live on iOS and Play Store. Visit self.xyz and follow SELF Protocol on X. Our breaking news with this week was a Circle has filed for an IPO planning to list its Class A common stock on the New York Stock Exchange under the symbol C R C L. So we got the Circle S1 filing. We got to take a peek under the hood of what the Circle's financials looks like. Seven, $1.7 billion of revenue and then $155 million of net income. Net income is basically profit. So there was just a lot of candy for all the analysts on crypto Twitter, just to take a peek of what Circle looks like. And I think that was maybe the theme of the week.

• 37:26David Hoffman?

  One of the big takeaways was wow Coinbase is making a killing off of Circle's business just by being the distribution partner around Circle and distributing USDC into the wild. There's been a lot of negative conversations around the Circle financials because of how much operating costs that they have. They are spending a ton of money on salaries and operating costs, over $250 million of a year in compensation. That's pretty crazy. And so while they're making $1.7 billion of revenue, they're spending so much money. Alex, have you had a chance to unpack the S1 and what's your take?

• 38:00Speaker 01

  Yeah, I looked at this. Well, first, I would say this is a long time coming. I mean, Circle was founded in 2013 in Boston, right? I was in Boston working at Fidelity. I've known Circle for, I mean, I guess now more than 10 years, right? And they've gone through a lot of phases in their business. And I remember in like 15 to 17, Circle Trade was by far the largest OTC desk in crypto. And that was like Dan Matashevsky, right? Like that was CMS. And then they bought Poloniex sort of at the 2017 top, right? And ended up selling that off. And I remember when they came and said they were going to do USDC in like, maybe it was like 2018 or 19, that they were launching the stablecoin business.

• 38:45Speaker 01

  And I remember thinking this was a really stupid business in general. I was like, why would you have like given up? Like you had pole position on trading, you had an exchange, like why would you like, you know, I didn't understand the appeal of number stay flat technology and which stablecoins are. I think the story now is very, very different, right? Like, stablecoins are a huge deal. I mean, I don't know what the TVL or the circulating supply of USDC is at this moment. I can check.

• 39:14David Hoffman?

  About 60 billion.

• 39:15Speaker 01

  $60 billion, I see. 60.7 billion USDC in circulation. That's humongous. Like, that's massive, let alone Tether, right? Which is 144 billion, right? So, and this is before we get stablecoin legislation, which I think is very likely to pass, which is also a good thing, I think. So, I think they're looking at timing. I mean, there had been reports for, I guess, a couple of years even, that they had previously filed confidentially to go public. This is the first public S1. I think, you know, they're running, I think, a pretty good business overall. I think- The question that one of the tweets you you showed raised about sharing all this net

• 39:56Speaker 01

  interest margin with Coinbase, I think, is a big, is a question. And I mean, you know, could they not distribute it themselves and save some of that money? But on the other hand, would it have gotten to $60 billion without Coinbase's help? Like, so, you know, I think they have huge interest in the stablecoin legislation. And they've been active in DC advocating for it. And I think they're likely to be the sort of de facto public-private partnership. I mean, I don't want to use the big, bad four-letter word CBDC, but oops, I just did. This kind of is the CBDC, right?

• 40:30David Hoffman?

  This is the CBDC of the United States, yeah.

• 40:32Speaker 01

  Yeah. And so, I mean, you're gonna get bank-issued stables. I do think you're gonna get a pathway for Tether to register onshore in some way and play here. There will be competitors, and I think banks, maybe some big ones, will maybe ultimately compete and succeed at competing against Circle and Tether. But in this market today, it's about $200 billion of circulating supply, and Circle's, you know, a huge part of that. So I think this is interesting. I think they are anticipating the legislation coming through and that adding more business opportunity for them, right? If they're public, they can tap public markets to raise more equity or debt. And so maybe that has something to do with the timing, I don't know. Also, you know, to be clear, the prior SEC wasn't letting anybody go through,

• 41:15Speaker 01

  really. So maybe that's the only thing for the timing, right? You know, I can add, as it's been widely known and reported, we have been working to uplist our stock from the Canadian Toronto Stock Exchange to, you know, a US, major US national exchange, and we filed an updated S4 last Friday. So you can search Galaxy and Edgar on SEC also and see all of our versions of this type of information. There's, I think, probably a big pipeline of companies that want to go public. And like... I think this SEC is going to be a lot more accommodative. So I could say a lot. I don't want to comment too specifically on Circle's actual business or these numbers, but I think they've built a really impressive thing. It's no surprise they want to go public in the US.

• 42:00Speaker 01

  The timing is good when you look at the SEC. They're sort of the new leadership at the SEC and combine that with the stablecoin legislation in Congress, which, I mean, we just saw that the Stable Act passed out of committee there, like 35 to 17. So like these bills, which is the House version of the stablecoin bill, those will be reconciled with the Genius Act, which passed with like five Democrats out of the Senate Banking Committee defecting from ranking member Elizabeth Warren to vote for it. So like this looks like it's going to be a pretty big bipartisan consensus. So this, you can imagine that if you get like, I mean, honestly, let's say you get a veto-proof majority of House and Senate voting for this bill, which is only like 66 senators, right? Like, this could be legislation that solidifies US dollar dominance.

• 42:45Speaker 01

  And when you look for decades, or at least impacts it, right? I mean, but that's what's so interesting about our prior conversation here too, David, with the shifting multipolar geopolitical world, the tariffs accelerate, is that on the other side of it, you have this game changer. And I actually think stablecoins are a massive deal for exporting US power and influence. So you've sort of got these cross currents coming and Circle wants to be, you know, near the center of it.

• 43:10David Hoffman?

  Yeah, I'll run through, I know you want to, because just of your position at Galaxy, you want to keep some of the comments on the actual business at arms length. So I'll just kind of run through some of the broad strokes of conversations of what people on crypto Twitter are looking at when they are looking at the Circle financials. One is the lack of growth in USDC year over year. It has been growing incredibly since July of 2023, but it's about the same that it was in July of 2022. So people have concerns about the lack of growth in Circle. Gross margin is down 33% just because there's a ton of operating expenses. People are also worried about rates. If rates come down, this comes right out of Circle's bottom line. And so they are beholden to Federal Reserve.

• 43:55David Hoffman?

  Interest rates to maintain profitability. And then also, people are kind of just looking at the comparison between Circle and Tether, where Circle has 900 employees, a $60 billion market cap. And in the fiscal year 2024, they made $155 million. So you compare that to Tether, which has a $145 billion market cap to Circle's 60, has 100 employees to Circle's 900, and it is generating $13 billion of net income to Circle's $155 million net income. So completely different numbers comparing the number one and number two stablecoin, stablecoin market cap companies. And then also, just one person like commenting on all of this, saying, "Nothing to love in the Circle IPO filing and no idea how the market prices it at $5 billion."

• 44:41David Hoffman?

  They conclude with, "It feels like a hail mary for some liquidity before the squad rolls in." The squad, I think he's implying is just, there's going to be so many stablecoin companies. We are currently watching a stablecoin institutional gold rush for all institutions, all banks to get their hands on some part of the stablecoin stack. Circle just gets to go public first because they were ahead of the game. But this is just kind of the, maybe perhaps, the last chance for Circle Equity to get some liquidity before just so much competition comes online. Any broad response to any of that?

• 45:12Speaker 01

  Well, there will be a lot of competition. I think that's clear. Pretty much every major bank has said that they want to do something here, right? I know Bank of America, I think explicitly said they wanted to do something. You've got the OCC and the FDIC reversing and rescinding prior restrictive guidance so that allows banks to do stuff in crypto. And specifically, the OCC one literally mentioned stablecoins. They can both hold the collateral for them and they can issue them. And so like, those pathways are now emerging and they, you don't need legislation for that. You can have the bank regu... I think the big one we're still waiting for from the bank regulators is the Fed to actually speak on bank crypto-related activity. But, you know, a lot of banks, national banks are primarily,

• 45:57Speaker 01

  their primary prudential regulator is the Office of the Comptroller of the Currency, is the OCC. They have already acted. You know, FDIC insured depository institutions have already received some of that guidance, right? And they've removed reputation risk from their handbooks and stuff, which is a Operation Choke Point 2.0 kind of situation. So you're already getting that relief. And so like, banks are, I think, are very keen on trying, payments companies are trying, there's myriad startups out there. I know that we've, our venture team has invested in several, right? Cross-border payments, stablecoin tokenization, whatever, right? You've got all the crypto natives like Athena and, you know, and even Maker still that, how do they play in this space? No one really knows. But the game is about to get shaken

• 46:40Speaker 01

  up pretty dramatically. Whereas, you know, today, for collateralized stablecoins, it is basically tether and circle, like, at scale. And in some ways, depending on what type of institution you are, you may only want circle. So circle has a really pole position in the US. But I agree, that, that competitive space is about to expand and get a lot, a lot more competitive.

• 47:01David Hoffman?

  One bit of news that came out this week was, banks got the green light from the FDIC to engage in crypto-related activities. So this is a formal statement saying that, yo, banks, you are good to go with engaging in crypto, like broadly, whatever that means. That happened on March 25th. March 25th, the FDIC, like you said, eliminated the reputational risk category from bank exams, because that was just too subjective. This is like, again, like you said, just the elimination of Choke Point 2.0. Reputational risk is not something that is a part of the examination of banks. What does this mean? Can, just explain the impact of this. What does it mean for the FDIC to just tell banks, you guys have the green light with regards to crypto? What happens next?

• 47:42Speaker 01

  So the paper trail for the FDIC's impeding of banks wasn't nearly as elaborate as the OCC. So if we just, if we focus first on the OCC, the FDIC is kind of following the OCC's lead here, right? So, under Brian Brooks, the OCC in, I think, 2020, published something, interpretive letter 1170, which allowed them to custody, uh, digital assets, right? It said, hey, banks that are under our emit, which is national banks, and I think, you know, depositories and thrifts and like, whatever, but basically, national banks. You can just custody crypto, right? And this was a huge deal at the time. And then they had another one, 1172, that said you can custody stablecoin reserves. And then they had another one, 1174, that said you can use stablecoins for payments and you can operate blockchain infrastructure for settlement purposes.

• 48:27Speaker 01

  So those three letters under Brian Brooks combined basically told banks they could hold crypto, they could hold stablecoin reserves, and then they could use blockchains, basically, right? So then President Biden's then Acting Director of the OCC or Acting Comptroller of the Currency, Michael Su, he came in and issued interpretive letter 1179. And with that said, it didn't rescind those prior three guidances, but it said if you want to do any of those, you have to come to us for a supervisory non-objection letter. So you have to ask us before doing it if you can. And then, of course, the OCC didn't allow anyone to do it. So like, that's how they blocked it. They didn't rescind the prior guidance. They said, you know what, actually, you got to come check with us first. And then when you did check, they said no, right?

• 49:12Speaker 01

  And so on March 7th, the new Acting Comptroller, Rodney Hood, and we're going to get the actual guy, Jonathan Gould, did his hearing last week, and we expect will be confirmed. They issued 1183, which rescinded 1179, meaning that banks could now go back to doing those things I said at the top, and they don't have to ask for prior approval. FDIC and then also the OCC removed the reputational risk, and then FDSE followed suit sort of on both of these topics. So now banks can just do stuff that's like normal stuff, basically.

• 49:44David Hoffman?

  That's the takeaway, banks can just do stuff now.

• 49:46Speaker 01

  You can just do things now, right? So, I mean, look, there are risks, like, to all of this stuff, right? And they didn't say, like, oh, you can just do whatever risky crypto thing you want. Like, they're going to be subject to other risk and prudential controls. I think part of the part that already exists. I think part of the annoyance here was like, guys, you never told us we couldn't, like, use Fed Now or some new technology. Like, how come with this technology, we have to get this special secret? Preapproval, right? Because we're already, no matter what technology we use, we're already subject to myriad oversight and prudential regulations. Prudential meaning, bank regulators can go in and say, change the makeup of your collateral. They can say, oh, your bank is lending too much, lend less.

• 50:30Speaker 01

  Like, they can literally move your balance sheet around, right? Like, that's the level of power that banking regulators have. Let alone stuff like oversight, controls, policies and procedures, et cetera. So, they already have the power to examine and prevent a bank from doing something way too risky. So, why were they being prevented specifically from using this technology? It never really made a lot of sense. It seemed punitive. It seemed part of OC 2.0 related stuff that actually we just don't like crypto. And that, oh, it could hurt the bank's reputation if they use crypto. Like, I mean, where does that line stop, right? Oh, well, like, whichever current politically disfavored thing is a bad reputation. So, it's great to see that this stuff is taken out, like, and it does mean, I think it,

• 51:14Speaker 01

  I mean, this is the type of stuff that banks needed before they were gonna really act here. But if you throw in, if the Fed were to come out and say something, which is a little bit of a tougher animal, since the Fed is a largely non overseen organization, right? I mean, we have, we the people have very little oversight over the Fed, by the way that it's constructed. So, it's much, whereas OCC is part of Treasury. Like, Treasury, it's an office inside the Treasury Department. FDIC is an independent commission, but again, it's more integrated, it's, you know, it's easier to sort of, you know, to correct, to reform. So, we need to hear about the Fed. That would help. I think that's sort of the last leg to drop on bank regulators that like, or last shoe to drop, I should say.

• 51:57Speaker 01

  And then also the stablecoin legislation, and/or market structure. If you get those, like, now you've got it codified in federal law that it's legal and here's how to do it. I think you, that's when you're really looking at the tradfi-ification of crypto and stables. I mean, that's what we're on the precipice of. I don't know, like, people ask, would, you know, Vitalik or Satoshi have thought of where we're headed, but it's inevitable. I mean, like, Bitcoin is for everyone, and that includes, apparently, big corporations. And like, that's what's gonna happen. So there are big fun questions about decentralization and sort of the cypherpunk ethos that a lot of us got into the space being a fan of, but nonetheless, the market is

• 52:38Speaker 01

  growing and maturing and these bank rollbacks of these harsh interpretive letters is a big part of that.

• 52:46David Hoffman?

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• 53:29David Hoffman?

  Use Uniswap's web app and wallet for a more efficient way to use DeFi. You may have already heard about InfineX. InfineX has, in my opinion, the nicest cross-chain swap and bridge feature that you will find anywhere. It is called Swidge, Swap and Bridge, and we're going to show you what it looks like. First, we're going to log into my InfineX account with a passkey. Now, there's no seed phrases in InfineX. This is just a one-click setup with biometric passkeys. But in addition to that, my InfineX account is fully non-custodial. So bam, I just logged in. It was two clicks and I'm already into my InfineX account. So let's go make a Swidge. I'm going to go Swidge my USDC that is on Base, and I'm going to buy Bara Chain, which is a completely different chain. So we're going to Swidge this. I'm going to press that button, and then InfineX is going to execute this order, this cross-chain

• 54:13David Hoffman?

  order for me. And now it is done. But actually, I'm not really feeling bearish anymore, so I'm going to go from Bara to Penguins. I'm going to buy Penguin on Solana, so I'm going from the Bara Chain to Solana. See, no transaction signing, no gas to worry about. You just Swidge across whatever chain that you want with InfineX. That was so easy. Go check out InfineX and try your first Swidge today. Hopping over to an adjacent but related subject is Eric Trump. Has a Bitcoin mining venture with Hut8. I'm a little bit confused of the details because I don't dive into the Bitcoin mining ecosystem all that much, which is actually great because I know you do, Alex. Something along the lines of Eric Trump is partnering with Hut8 and wants to go public this year via a, by having, acquiring a majority stake in American mining, American Bitcoin.

• 54:57David Hoffman?

  Do you know the details of going on here? Because I'm just butchering this.

• 55:00Speaker 01

  Not really. I don't really know American mining. I would say we have a lot of public mining companies. It's one of the few in the US. It's one of the few sectors in crypto that has been able to access public markets, right? It's basically been Coinbase and miners, basically. And then like Bitcoin or crypto adjacent firms like, you know, like, like MSTR, which was already public, but also like, you know, PayPal Cash App, like whatever, but the Robinhood. But, you know, none of these really, Robinhood, yes, but, but in sort of real crypto, like, none of those miners were venture backed. This is one of the sort of, I know I'm taking this a little bit of a different direction here, but like, one thing that's so exciting, I think, for people, if the US public markets

• 55:42Speaker 01

  are more open generally for listings, not even just crypto related, but certainly crypto related, is the venture investors have backed so many companies over the years. I mean, like I said, Circle was founded in 2013, right? And like, there is a, but yet only investors, early investors in Coinbase, were able to exit into public markets, literally. Almost every other acquisition or merger in crypto was paid for with the acquiring, also not public companies, a liquid stock, like almost all of them. So there's venture investors that have been diligently, you know, investing in equity plays, again, leaving tokens aside, like, that haven't been able to access. So, you know, I, this isn't one of those, the mining industry is very tough. Like, you know, we've, we've talked about and announced.

• 56:27Speaker 01

  Yeah, we have a big Bitcoin mining business at Galaxy and we've announced and said that we're transitioning it into an AI data center play and many other of the miners are. Not all of them. I mean, there's sort of one of the interesting things happening in the Bitcoin mining industry, especially if you're a mining company. I mean, there are plenty of private miners in the US and around the world, but if you are a public company or a company that mines Bitcoin, you're looking at your sites and you're wondering, can I make more dollars per megawatt, you know, servicing the hyperscalers than I can mining Bitcoin? That's a reasonable question because at the core, these sites are warehouses with lots of electricity going into that, right? Like, they can be retrofitted to

• 57:11Speaker 01

  do service different types of machines and clients. So I don't know if that's, I really don't know anything about American mining, but yes, that you look, the other thing I would say about this that, you know, with a caveat that I don't know anything really about this company and I don't know much about HUDEA personally, is that Eric Trump really likes Bitcoin and he actually speaks quite eloquently about crypto. I don't know if you've seen him, but the one that I watched was his appearance at the Bitcoin Mina conference in the beginning of December and then a subsequent interview with Frank Corva from Bitcoin Magazine just with Eric and he gets crypto and Bitcoin. Like, he knows how it works. He knows why

• 57:51Speaker 01

  he likes it. He knows why it's important. He's not a tourist. So, you know, I would just say like this, this isn't, this I put more weight into than some of the other like adjacent Trump world announcements with crypto. Eric seems to have a real view here.

• 58:08David Hoffman?

  Speaking of miners that are pivoting into AI, have you been following the CoreWeave IPO?

• 58:14Speaker 01

  Oh, yes, of course. Yes.

• 58:16David Hoffman?

  Yeah. Okay. So CoreWeave IPO, CoreWeave is this company that started off mining Ethereum back in Ethereum's proof of work days and with also the intent of eventually transitioning into an AI inference company, which is exactly what they did. And then they went, they went public Monday of this week, I think, or maybe Friday of last week.

• 58:36Speaker 01

  Yeah, I think Friday. Yeah.

• 58:38David Hoffman?

  Yeah. And so, stock price started off flat at basically just under IPO price and has since then just jumped a very high amount to like something like up 40 or 50%. When you saw the CoreWeave IPO, just price action, positive price action, what was any of your big takeaways or just general comments?

• 58:56Speaker 01

  Yeah, I mean, CoreWeave, I've known this company for a long time. I knew them when they were an Ethereum miner, a GPU miner. They had a detour where they, before the AI craze really started, they were, but after, or in anticipation of the merge, which would basically brick their Ethereum mining business, they had a detour into video rendering and stuff like that. I can't talk much about CoreWeave. We've also, we announced during our earnings call last Friday that we are partnering with CoreWeave, and we announced a deal with CoreWeave. So if you search CoreWeave Galaxy, you could see that deal. So I can't speak too much about CoreWeave, but in general, I would say like, demand, I believe the demand for compute is high,

• 59:36Speaker 01

  and it's higher. And I know everybody worried about DeepSeek and like, was it lower than we thought demand would be in the future, but you know, when you saw like the Studio Ghibli stuff happening and you have Sam Altman and Grok and Claude. Yeah, like there is so much demand, and I think even if something like DeepSeek or other future as-yet-unknown efficiency gains, right? Which they probably will come, we're an inventive species, humans, we probably will come up with other DeepSeek moments. Still, you look at the amount of, you know, gigawatts in the US and servicing data centers, and it just still is not enough.

• 1:00:16Speaker 01

  Like, so maybe, the way I think about it is like, maybe in like 2035, like, at some point, maybe the efficiencies do like pull back the net terminal amount of compute we think we need. But I don't think we're anywhere near the level of demand that is showing now, and so there is huge need for it. And it just so happens that there is an industry that spent the last, you know, 10 years buying up like cheap power assets, right? And building data centers. Like, I mean, this is what's so interesting about the Bitcoin mining story is that, and I think I tweeted this like in September or something, what I said, like Bitcoin mining was the real crypto and AI play. I mean, sure, we'll get other, you know, agents on chain or like using payments. I think that'll be a sector too, but

• 1:00:59Speaker 01

  this is a massive reorganization of a huge industry. So not everyone can do it.

• 1:01:06Speaker 01

  You know, there's certain, you know, depending on where you are, like your site is and whether you have access to fiber and like the, because they, the latency demands are much different for AI, you know, training and inference than they are for Bitcoin mining. You can run a Bitcoin, a giant one on like a cell phones level of, of bandwidth. But you need good, and these are different levels of data centers than Bitcoin mines. So there's a lot of work to do to transition them, but I think it's just a really interesting thing. And I, and I think that, you know, it's almost like just energy in general. Like, do we really think in a hundred years we're going to have less compute, less demand for compute than we do now? Like, I, I think we'll have a lot more personally, the same way it's like, you know, if you think about the degrowthers, like, do we think that there's going to be less demand for energy in the future? I don't think so. I think it's going to be higher, you know?

• 1:01:51Speaker 01

  Maybe you want it to be greener or more renewable or whatever, but I think the net megawattage, the net gigawattage is going to be, is going to go up forever. Like, that would be my guess. And, and I think, I mean, compute is going to be, I mean, we're a digital species at this point. In my mind, you just need a lot more. I think it's really interesting. This was an exciting, I mean, CoreWeave has been an exciting story to watch because, you know, also the market. Again, like if you pulled up a chart of like IPOs by year, like there have not been many for a while, like this is. So I, and crypto, like I said, I think has a part to play in that story too. I hope it does. I think Circle's a good, a good sign there. I think, I, I want to see, we want, we want people to be able to buy and own access to good companies. And there are, there are plenty of them in, in both AI and in crypto.

• 1:02:37David Hoffman?

  Yeah, as I've gotten into AI more and more, starting, you know, starting with the AI agents that had their bubble back in January. I thought that was going to be the most interesting thing and, and it is, but I find myself getting pilled by deeper parts of that tech stack. And so I go down to, well, actually the compute and energy conversations are fascinating. Because just as you said, like how, we are going to need more than a 10x of energy to service the compute needed to, you know, gibblify the internet or do whatever we're going to do in the future when we have more AI capacity. So like you, you had, there's the AI models arms race conversation. There is the nuclear conversation, which this is how we're going to power all of these things. There's the hardware conversation and the Nvidia conversation.

• 1:03:21David Hoffman?

  And I think this part of the very low level part of the stack is actually the more interesting part to because like the AI agent surface level, the cosmetic level, the top of that whole entire stack, that's going to change so incredibly fast. And it's really, we still need to build out the bottom level infrastructure, the actual physical part of the whole AI tech stack to really actually see where this goes. And I find that just immensely interesting.

• 1:03:44Speaker 01

  I agree. I think you need more. You just need more. You're right. It's a great point. I mean, a new model still needs GPUs back there and electricity to power them. I should have said, and I'm going to say now, none of what I'm saying is financial advice. Throw that out there. You know, no offers or recommendations or solicitations to buy Galaxy stock or any other stocks at all. But I agree. I think you just need, we need electric, and this is the thing about what President Trump said. He said, "We're going to have so much electricity, you're going to say, 'Please, sir, no more electricity, sir.'" Right? I mean, I think he's right. I think you need a lot of electricity. You just do. It's an electricity. And I don't know if we're going to divert into nuclear, but I totally agree with this.

• 1:04:23Speaker 01

  It turns out there's also the world's most dense energy production capability ever that also has, its only emission is steam, and it's nuclear energy. And we should be figuring out how to build more nuclear as well. It's green, guys. It's green energy.

• 1:04:40David Hoffman?

  We've got a nuclear episode coming down the pipe on the podcast pretty damn soon here. So we're going in that direction.

• 1:04:46Speaker 01

  Love that.

• 1:04:47David Hoffman?

  Alex, thank you so much for joining me on the podcast today. I don't know who else I would have had on to successfully navigate some of the craziest news that happened this week. Really appreciate you. Alex, if people liked your takes, they'd like the sound of your voice, you've got a podcast. Maybe you can tell them a little bit more about where your podcast is and what they can expect by listening to it.

• 1:05:04Speaker 01

  Awesome. David, thank you so much for having me. Yeah, listen to Galaxy Brains. You can search it everywhere. You can go to galaxybrains.io. It takes you to that page that David's got on the screen now. And yeah, follow us, GLXY Research on Twitter, or galaxy.com/research, or me, intangiblecoins on X.com.

• 1:05:20David Hoffman?

  Bankless Nation, you guys know the deal crypto is risky. You can lose what you put in, especially when we tariff the whole entire globe. This is a frontier. It's not for everyone, but we are glad you are with us on the bankless journey. Thanks a lot.