2024 Presidential Election Breakdown With Alex Thorn

Transcript

e e bangas Nation last night the United States had an election and last night an

election was concluded today to unpack all of that with us is Alex Thorne the head of research at Galaxy digital he's goingon to help us understand the impact of the election results last night and what it means for the crypto industry moving forward Alex thanks so much for I know it was a long night last night and it's an early morning this morning uh thank you so much for coming on the show and and unpacking all of this with us yeah you're welcome David hey Ryan uh wow I mean wow what a what a night I think um better than certainly the mainstream media uh would have had anybody expect I think that's right I think that's right that's definitely a big topic is the the gap between the mainstream media and uh our more crypto native New sources poly Market definitely uh having a front and center

role here uh but first I want to just kick things off Alex with the red sweep uh last night uh the Republicans won the presidential race the Senate the house and the cherry on top the it looks like the popular vote as well just first reaction what does this mean for crypto what does this mean for our industry uh it's gamechanging we are about to enter a golden era of crypto and Bitcoin in America there that sound that you're hearing maybe you're you're hearing some static that's thousands of crypto entrepreneurs buying tickets to move back to the United States like this is an absolute Ser it's an absolute Game Changer um you're going to have endless non-stop Catalyst every week for 18 months the headlines are going to knock your socks off just like the former president said in Nashville we're going

to be so tired of winning sir we're going to be begging him please sir no more winning no more electricity sir I mean no it's truly gamechanging the former president has his own defi protocol I mean he's plenty you know he's he sell his nfts this is um obviously he's made tons of pledges he's he's adopted an entire proc crypto agenda but it's not just that he's got Howard lutnick said he owns shed loads of Bitcoin said it's hundreds of that Howard who's Howard the chair of his transition team it's the CEO of uh caner Fitzgerald the primary uh dealer bank that um tether does all its Bank deal with tether too okay they do and they're also I mean one of the biggest and most iconic American Banks um and he's leading Trump's transition team you've

got vivec ramaswami on the team who loves Bitcoin and crypto JD Vance owns a bunch of Bitcoin at least we know um and and loves it right you got Robert F Kennedy Jr I mean this is a team of people around him not not not you know not to mention his entire family right don don Jr and and Eric and supposedly Baron also all love crypto right so I I think there is a very very strong chance that um the next four years are just truly gamechanging for the upside for crypto I think the big surprise here I think if you asked the average crypto participant who is going to win they would say you know it's probably it's probably going to be Trump uh the polls were giving us uh 50/50 poly Market was giving a a decent Edge to Trump yeah but

I think the new thing the the surprise is the sweeping Landslide so can you like what is what is why is that Gap significant so like you know the difference between a solid Trump Victory and a completely sweeping Landslide what's the significance of that yeah this is a shot across the bow across a number of bows right I mean start just maybe with the the mainstream media there was a significant Divergence between even sort of major proprietary forecast models and the prediction markets and odds right as you said David like yeah KY um poly Market predicted interactive brokers uh Robin Hood all these bookies they all had it in Trump's favor the whole time at least since summer like but in some cases 6040 or or higher

right and um but like Nate Silver's model converged to 5050 last you know on on Monday night like um 538 was much closer now they they mostly slightly favor Trump so but these you know that's there's this joke about statisticians that like there's all these like you know like lines and charts on them thing and at the end they're like I don't know 50/50 coin flip right they can never be wrong yeah I mean he look he he was probably slightly favored to win but I don't think that you know certainly even in his Camp from Republican friends of mine last week were concerned they they were worried maybe it was slipping right um you know a a near Victory let's say I mean there their outcomes on both sides where it could have been 270 to 268 in the

Electoral College that would have been a disaster for the country in general like I think it's fair given what happened in 2020 um Trump's grievances about the outcome of that election that we no matter who won you hoped it would be big so that there wouldn't be like weeks months of litigation right yeah that's worst case scenario right yeah it really is like um and so I mean look I think he's GNA win the popular vote he's not just going to win the electoral college it looks like he's going to win the popular vote that hasn't happened in like you know five or eight elections for Republicans this that's a clear more of a mandate yeah ites okay so so the presidential is obviously confirmed uh very confirmed Senate uh house as well is the house now the house is it's

leaning Republican it is Republican now but only by two two seats currently right like it's barely Republican today um we won't probably know even maybe for a couple weeks there's just a lot of races and a lot of little places and many will be very close and some will go down recounts that'll just take a little while the is confirmed that was not unexpected even a even a big Harris Harris would have had to really Landslide I think to carry to hold the Senate and um the map was just really bad for for Democrats the cycle um the big the big big win for for crypto here is Bernie Mareno unseating sherid Brown in Ohio let's talk about that yeah explain the significance of that who's shered Brown and why is his uning so important for the crypto industry yeah

sherid Brown is the current chair of the Senate Banking Committee um in a Democrat he is um a big Ally of Senator Elizabeth Warren who's you know senior on the Senate Banking Committee he I would say he has not been good for crypto he hasn't been the most vocal like outspoken opponent but fair Shake spent the most money of any race in this race crypto money I think when I looked uh yesterday they had spent $20 million in this race sherro Brown uh in favor of Bernie Marino shro Brown gets an F strongly against crypto I mean he even voted against things like Sab 121 repeal yeah I mean even when uh you know Democratic senators voted for that right

so um he he is a and and and the Senate Banking Committee oversees the Securities and Exchange Commission right and so that that committee is integral to financial regulation in America and he is a major roadblock to getting anything done right if you had like any you know even just a moderate on crypto in charge of that as a Democrat we might have seen fit 21 come up on the floor in the senate or stable coins or something for for crypto to spend so much money and unseat a a guy who uh it was so important in the Senate like this is a shot across the bow against every anti-crypto member of Congress right now this shows that the industry can Flex muscle and deliver this is Brian Armstrong uh he he said this in

aftermath welcome to the new members of America's most pro- crypto Congress ever 219 plus pro crypto candidates in counting have now been elected to the house Senate tonight the crypto voter has spoken decisively across party lines and E in key races across the country Americans disproportionately care about crypto and want clear R rules of the road for digital assets I mean I think this speaks very highly to crypto's like let's talk from an industry perspective and kind of a campaign perspective to its ability to like organize this election I mean the stand with crypto website was you know like kind of genius and all of the the funding and pack money in uh directed races like also had a massive impact that I don't think the

presence of crypto in any other race has like felt anything like this but you really felt the presence of of crypto and not just like uh you know organizers and donors and and groups like coinbase and a16z but like kind of in the Grassroots with with stand with crypto I mean there was a really a push to overturn some of these anti- crypto Army type candidates and it seems to have worked like seems to have paid dividends I don't think we go back from that I mean like big Winners coming into the election obviously were were crypto I think the crypto industry and its ability to shape politics also I would say poly Market by the way on poly Market that's how I um you like saw that

Trump was winning and I I was watching kind of mainstream news as I usually do like calling elections going state by state at that's going so slow so slow so slow and while I was on my phone I was just seeing like this which I'd seen in many poly this is what a market looks like when it's resolving okay so if you can't see the screen what I'm what I'm showing is kind of like Donald Trump suddenly spiking up like volatility and like KLA Harris odds suddenly spiking down I saw this in so many markets and poly Market that are resolving and I you know when you saw it creep up Beyond 75% to 80% I was like well it's over and that happened around like 8:30 9:00 like poly Market was a huge winner in this as well and that's a CP cryto it's a crypto

project at the end of the day so a lot of wins here yeah big wins and and paully was you know we were watching as as you sort of go east to west right they come in in the east coast states first and then and then as you go across the country and polls close Florida was something we were watching really closely right it um it's been Republican for several elections but Miami Dade County where Miami the city is and then pelis County right outside of Tampa two that we were watching really closely and you could see it react on poly market so Hillary won Miami Dade by more than 30 points okay Biden only won it by seven Trump won it by 13 12 or 13 um and so it a massive shift I mean we're talking

almost a 20o shift in his favor same thing pelis has voted correctly in every presidential election for like the last 10 except for 2000 and as those results and Trump trump won it last night and as those results in even just those counties and in Florida the margin of victory in Florida more than 10 points it's going to end up being 10 or 11 um you saw Paulie start reacting and the same thing it looked like Virginia was way closer for Trump than it than it was expected to be and you just saw paully was creeping up 72 you know uh 28 then it's it felt like reading the future as I was like looking at mainstream news kind of reporting on this and looking at like poly Market markets it it felt like oh I know this like six hours in advance yeah exactly um it really was it's a big

deal too right I mean if Polly like if the election goes the other way everyone's going to say wow prediction markets don't work right oh it's too thinly traded Po's offshore you know predicted is this crazy one and you know this Australian one where they have a a consent decree with the cftc that allows them to exist as like an academic project that they actually have a limit on the total number of Trades and amount bet that can be done so for like the last two weeks it's been at like 55 52 like unable to resolve properly as a market it's ConEd yeah they were only letting like like one out one in at the end so um these these could have looked I mean if Harris had won poly Market would be have a lot of you know reputational problems it's not like their fault it's a free market

but I mean this you know I mean again the margin of lead he's had for frankly months like I think is Vindicated here we we know that paully odds are not forcast models for how much he's going to win by right their likelihood of Victory and it turns I mean he won bigger than he won in 16 or it looks like at least as much right I mean it's going to be it's going to be a big resounding win and so those like 6040 odds like that seems reasonable like now and so I I don't know this is especially again if you get change in regulation obviously Ki won that suit against the cftc like a month or two ago that has basically made po prediction markets on elections legal now in the US um these

things may have a very bright future I want to unpack a newon between the difference between poly market and mainstream media the the common uh talking point about the reaction to watching the election last night was poly Market called it first you could have guessed who was going to win by watching poly Market hours before had you been watching like mainstream media this is like a big plus to to poly Market to the prediction Market model uh but um and then people are just like lenting about uh um mainstream media saying like man they they're so biased there are these swing States that they're saying are too close to call even though they're like 85% of the ballots have been counted and so people were saying like there's there's a bias

in mainstream media uh because they're just refusing to call these things I want to actually be Double's advocate for this uh mainstream media when they call a state you do not unall a call and so they have to be Rock Solid sure they need to be like 98% sure that that state is going to go in that direction so I'm kind of like pushing back against the mainstream media not calling States soon enough uh is biased idea I'm actually just saying I'm going to present the idea it's not about the bias of M media it's about the better mechanism of prediction markets that can actually inform us at a sooner and less biased um point in time than mainstream media that's kind of like my take about

pushing against the kind of the discourse about like the bias nature about states that are too close to call Alex do you have a reaction to that yeah I totally agree I mean think about the way they they call the states um like AP NBC News these I forget there's a third one that paully needed to in order to resolve um they they look at the actual votes they say how what is the margin of of of lead by one candidate and how many votes are outstanding until the votes outstanding can't possibly flip the the election to the underdog they don't call it right so they're not predicting the outcome they're saying is it even possible when it's not possible for the leading candidate to then lose that's when they call it oh let's let's get into uh some price action Bitcoin uh

touched $75,000 last night which is an all-time high congrats to bitcoin well done well done uh Dogecoin up 15% likely due to elon's significance uh and I can't help to notice that some classic SEC targeted coins like uni are also uni is the the number two big mover in the top 100 coins in the last 24 hours oh we finally get the fee switch huh we're getting the fee switch on uh the boot is coming off a lot these like invest like investment tokens rather than meme coins uh Alex just any comments on like the price action I mean I again Bitcoin was moving well before uh sort of in line with pully I mean I I I looked at these these markets looking

moving similarly I think um it's undeniably bullish for I mean like I was saying at the top I don't we get into more detail but it is a trump presidency alone let alone a senate that's also Republican that can appoint his confirm his appointees it's undeniably bullish for the industry um I think so I don't think it's unexpected I think it's it's quite poetic that Bitcoin made an alltime high on Election night I mean that's yeah you do like to see that um we it was very exciting uh here at Galaxy you know pretty much the entire trading and research teams was here until like you know one in the morning so we were watching this live and um I you know I don't I don't know I I I hope I I you know I I'm not I'm not sure that I'm ready just yet I think mostly

because of Solana's competition here but you've got to think eth BTC is is an add or near a bottom I think I if the regulatory regime is about to move in you know broad crypto's favor because again you mentioned Unis swap the app layer ether has been sort of through it's it's made it through finally with the ETFs but the app layer in crypto is is under regulatory scrutiny right and ethereum is the largest you know platform for crypto apps there is particularly the biggest one and the and the one most subject to financial regulation which is defi so I I think you're going to see more gains in in um in defi tokens in in Broad crypto altcoin land uh I think it's going to be you know it's we're really just getting

started I mean I I went right to bed right as the thing was being called by them so like I I and then I I only got up at like 8 am right and rushed here to get on on this so I even I'm still digesting this I think the market is still digesting it too you're about to have trafi markets open in three minutes as well so oh yeah I I feel so so we'll see what coin price does we'll see what Robin Hood does coin is up so big pre-market coin is up over 10% in pre-market I mean right it's like the these companies literally have Welles notices against them that are going to like literally you said at the top evaporate they're going to go away they're gone so man there's so many so many uh like ways we could take this S&P

500 is pre-market up two 2.1% like all the major indices are up like the cryptool link equities are up I think I think actually I'm I'm is down I'm like you I'm kind of like I'm surp I'm letting this sink in but I'm surprised that markets haven't reacted even more favorably like particularly crypto markets because I just want to paint this framing okay so like for the first decade in the US Regulators largely kind of like ignored crypto right it was like the first they ignore you type of thing then we got into They're laughing at crypto it's just like Ponzi schemes whatever right and then for the last four years or so we've been in the then then they fight you type phase okay so they have been

fighting us this is what operation choke point is this is what the embodiment of Gary gendler sending seven Wells notices just this year one I'll note six days before the election he sends a well Wells notice to a mutable a gaming platform if by the way if this doesn't uh signify the hubris of the Democrats in like the Comm La Harris campaign like letting this happen the White House letting this happen another Wells notice to crypto 6 days before the election like that's basically like crypto voters don't matter to us okay the you know the results show that they maybe should have thought that through a little bit more anyway all of this all of this reverses we have never been in crypto in at a

time when we had U us regulatory Tailwinds they've they've always either been nothing like completely ignoring us or laughing at us or headwinds okay and that's what we've had for the last four years headwinds all of these tokens here they can only be like useless governance token because we can't have a fee switch on top of them even though they're generating so much cash right so all of our tokens are neutered we have operation choke point we have like stable coin legislation that can't move forward we have Gary Gensler blocking all of our crypto entrepreneurs from like doing anything I can't even it's the US and I can't even get like an airdrop because I'm Geo blocked yeah free free token free money and it's all because of like the the regulatory

headwinds that we've been facing and all of that will completely reverse I don't think I'm overstating this I okay okay like can we go through methodically of like what exactly is going to reverse and be undone all of the these like bad spells that have been cast for the poor the last four years are gonna like go away so I know Gary gendler is getting fired I know that's happening I I think um let's start with the SEC right because I I think Gensler we know that uh Trump I mean his biggest line of Applause at in Nashville was to fire G against like he was taking back remember had to say it twice yeah he was like he was like wow I didn't know he was so unpopular like did by by the way how did the Democrats not see that clip and just

be like oh this is an unelected official and he's like sinking our party like that he seems unpopular why did they not throw him under the bus anyway go ahead it's a good great question and you can imagine the the political Capital that President Biden had to spend vetoing that Sab 121 overturn is ridiculous like they came out uh when the house passed the return and then uh the National Economic Council released by the White House's statement of administration policy which is their position where they said they would veto it if it came to his desk they describe the Sab 121 overturn as basically an apocalyptic financial terms which is like ridiculous it's a it's a it's an Arcane like tax issue and banks are the most heavily regulated industry in America so like you know they can do stuff and The

Regulators can they have credential regulation okay that means that the regulator can come in and tell the bank what to do it's not like oh I don't not sure they can be like take this off your balance sheet and sell it right now whatever something bad right so it was never that big a deal and the fact that then in face of that VTO threat uh a bunch of Democrats voted to overturn it anyway and Biden had to veto it do you think Biden wanted to waste political capital on on this ridiculous minor thing from the SEC first return on investment I mean that is literally in investing in a political shitcoin right there that's that is so Gensler though firing Gensler I think most constitutional Scholars agree that the president cannot actually fire uh a duly uh termed and appointed

independent commission member most alternatively most agree that the the the president can appoint a different acting commissioner almost acting chair almost immediately so G whether gansler uh is fired I think remains to be seen whether the Trump Administration even tries to fire gansler we don't know um but he is very likely upon taking office to appoint one of the existing Republican commissioners Hester purer pesterer Pur I know or markada who's also great for for Mark's fine but like I would love Hester as well I've had Hester on Galaxy brains my podcast she's brilliant I mean she's a brilliant mind one of those two very thoughtful very polite and and

and very bright I mean one of those two is likely to become the acting chair almost immediately so they they can so good I haven't gone through every single action the SEC has taken and which of them were actually voted on by the commission versus can be immediately changed but they can uh replace the entire staff of the enforcement division or the entire leadership of enforcement almost immediately um that's why I think among the first things you're going to get is exemptive relief so you're going to see no action letters sent you're going to see uh the coinbase and Kraken lawsuits withdrawn you're going to see process how do they do that wait every single Welles notice will turn into a corresponding no action letter I'm sorry yeah very very possible I think if you

if you have received a Wells notice in general that's an indication from the staff of the enforcement division of the SEC that they intend to sue you if they haven't filed I'd be shocked if you see any of those filed if they if you've gotten a Wells notice but not been sued I'd be shocked if you end up getting sued um if you have been sued it's going to be a little bit trickier because courts really don't like it when big lawsuits are are filed with big like apocalyptic angry terms and then just you're like oops just kidding withdraw that like so honestly there might even be some instances where instead of actually withdrawing the court forces a settlement between the SEC and uh just takes a settlement yeah I mean these are largely at the discretion of the enforcement Division and and the chair I

I would say so but the big ones Alex like the ones against coinbase and Kraken and and Unis swap the ones that we've heard about uh like how far I know most start notices yeah it's yeah and and uh coinbase is the most far along right it's been what almost a year and a half maybe or a year um but again like they're not like too far I mean they can definitely be amended or withdrawn um or settlement re yeah yeah I mean think about this dude they I I didn't even realize this really until we saw them send the Welles notice to Cumberland but I don't know why I didn't realize this maybe I'm just too optimistic but we know they've basically gone after every single US exchange right you basically have coinbase Kraken Gemini and crypto.com I think really operating at

scale in the US and not many others I don't think maybe any others um all of those coinbase and Kraken have lawsuits filed against them crypto.com received a Wells notice and preemptively sued I I don't know what's up with Gemini but they had a whole bunch of SEC stuff with Gemini ear and other stuff so that's the entirety basically of the US like retail Exchange Market then you start to see Cumberland which is OTC institutional only Market same basic lawsuit failure to register as a national Securities Exchange trading on registered Securities I think if Gensler and the current SEC had remained in for like another year or two years it it's very likely that within that time period you wouldn't be able to buy or sell anything in the US other than like Bitcoin or ether like seriously okay okay this is

what I I feel like non non- crypto people who just like ah crypto's kind of a fringe issue they have no idea what was going on in the crypto industry like Gary gensler's sec in particular and you combin that with chokepoint which I'm sure we'll talk about was like targeting all legitimate crypto companies in the US this to me I've never I've never been on the inside of an industry in the way that I am in in crypto but this has got to be unprecedented like the attacks they just kept coming and it was everybody in the industry yeah like I don't think people realize how extreme it was and why this was existential for crypto and so some people point at like the amount of money that that crypto's kind of put into this uh cycle and they're like oh you're trying you're

you're trying to buy all the politicians it's like we're trying to stay alive okay like without this without playing the the game we didn't create the game we didn't create this game we didn't like vote Yes on citizens united we didn't vote for money in politics but like we're in the game and if you're not not at the table you're on the menu and this election cycle crypto decided to be actually at the table and it you know that's the reason it ran like it it um got these wins coming out of it that's totally right I agree it's not fair to malign crypto for advocating for itself it's also you know Ryan to your question about like has this ever happened before I've only worked at Fidelity and Galaxy in my entire career I was at Fidelity for 12 years so I haven't exactly been

around a bunch of other Industries either but you know one if we think about chokepoint right chokepoint 1.0 was against like what we call you know like gray area businesses not even gray but like things like the payday lending industry very predatory right in in the scheme of things right but also like guns totally legal constitutionally protected right and um so those are legal Industries you know um that were directly targeted right specifically targeted with the by the way chokepoint 1.0 chokepoint that was their name for it as far as we know I think there are some Foya requests to the government to see if it was ever called choke point 2.0 um regardless of whether they called it that it absolutely has been that um and for an industry as benign uh I mean

it's not payday lending don't get me wrong I think we all know there's been plenty of scams it's open-source Financial software right so like of course uh you know Bad actors can use it we're not asking the crypto industry is not asking for a free pass we're asking for rules that allow good Innovative actors to thrive and we want The Regulators to go after scammers and theves nobody is saying we don't right um but of course you mentioned like the most high-profile actions taken by the SEC have been against the best actors right it right FTX they did nothing right Celsius they did nothing right but but but um you know coinbase like this is a publicly traded company this is the most transparent crypto company in the United States basically uh by by rule

because they're public right theoretically the SEC should want more to be public that that's transparency um so yeah it's been really unfortunate in general I would say and you know a choke point here's another good example of what's can happen quickly right SEC it's a little tricky it's an independent commission I said that you know you'll see some immediate relief um I I would say also the industry wants longer term statutory relief we want legislation right so that you know if in four years you know our our biggest if Elizabeth Warren were to become president you know like you know um then then uh you know it won't be just immediately rolled back right we don't just want exemptive relief like no action letters and halting actions against us we want permanent legal status right um that will take it could

take the entirety of a four-year term for that to even happen but what will happen quickly is all the stuff under treasury right there's no question whether the president can appoint a new uh comp control of the currency at the OCC which is the primary uh Prudential regulator for National Banks so if you remember that um a couple weeks ago uh the SEC sort of I said was exempt of relief technically it's not but they created this effectively a loophole that let bny melon uh avoid Sab 121 they said well if your Prudential regulator primary Prudential regulator says that you can do crypto and uh you know and you have a bunch of other risk mitigation stuff of course it's the oldest bank in America bny they they do have that stuff then you can proceed and you don't have to carry on your balance

sheet your client's crypto assets and so we were all like well I mean there's only bny is a its primary credential regulator is the New York Department of Financial Services and so we know that th nydfs has I mean they're strict obviously but like they have the bit license they have legalized crypto in New York if you have the right license so that's why we knew it was bny even before they said it was them was because that that's the only big bank that we think wanted to do it that has a primary credential regulator that would allow it well a lot of other banks that are National Banks they primary Prudential Regulators the OCC and we knew that the current OCC under acting comproller Mike Sue would not allow it well a new Trump appointed one will almost certainly

allow it so so Banks being allowed to do stuff with crypto um let alone the allowing crypto companies to open bank accounts which is really what choke point was about um that's G that that changes fast I mean you can appoint a new acting almost right away um with a senate that's in Republican hands he can probably get them confirmed for the full term term right and so you start to see now then you have the FDIC an independent commission also but similar to the SEC he can probably Trump can probably make a new acting right because the the main players in chokepoint is the OCC the FDIC and the FED right can't we can't do much against the FED but if the national primary Prudential regulator is is saying it's okay or or to stop discriminating I think one of

the first things you might see out of OCC is a is a rule Express expressively prohibiting you know bias against companies that want bank accounts if they're legal right I think we had that in the first Trump presidency they came in one of the first things that they did at the OC was explicitly make that against the rules choke point style um so I I think that that that just ends pretty fast I mean it's not um it's not much of a question yeah which of course isn't just good for crypto but I'll just call it good for Freedom good for good for the right to transact in America kind of restoring some of the uh foundations that this country stood upon uh Alex there's a bunch of more topics that I want to get to um free Ross is on the table uh I

want to talk about the the tech sector uh because historically the tech sector has been liberal it's been very conservative this election also Elon Musk is a topic I want to bring up there's a lot more we have to unpack but first before we get to all those subjects we have to take a break and talk to some of these fantastic sponsors who make this show possible if you want a crypto trading experience backed by world class security and awardwinning support teams then head over to Kraken one of the longest standing and most secure crypto Platforms in the world Kraken is on a journey to build a more accessible inclusive and fair Financial system making it simple and secure for everyone everywhere to trade crypto kraken's intuitive trading tools are designed to grow with you empowering you to make your first or your H hundredth

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I want to summarize some of this with a tweet from uh Victor bunan he says crypto one next we're going to free Ross fire Gary end operation chokepoint 2.0 pass Common Sense stable coin legislation enable in-kind redemptions turn on staking and ethereum ETFs shutter the SEC lawfare investigations and provide regulatory Clarity for crypto I feel like that about summarizes it and Alex before the break you were you were talking about operation choke point getting Unwound like the changes coming to to the SEC I think a lot of the regulatory headwinds that we've been facing have been due to the administrative State they've been really coming out of the White House and the

cabinet and those that um you know the Biden Administration have kind of like selected in positions of power and surrounded themselves with do you have any sense for what like the Trump cabinet might look like and the Trump Administration might look like because we're all expecting sort of a complete pivot from the types of folks that were in the White House and would have been part of a KLA Harris Administration like do we have any names for who's going to be treasury secretary next and that type of thing I mean there's a bunch of speculation that really has only really just begun this morning like I was watching CNBC before I got here and talking about rich Besson they're talking about Howard lutnick at the at the treasury um are there poly markets for this yet Hagerty there should be Ted

ha the senator from Tennessee has been a long time who's by the way very Pro Bitcoin and crypto has been a long time uh mentioned as a party um you know um the Robin Hood's Chief legal officer Dan Gallagher has been mentioned at SEC um Robin Hood does a lot in crypto I'm sure that would be good for crypto um we don't really know I I would say at a high level yet it's it's still pretty early but we do know that they're going to be Pro crypto because like actually last Trump Administration here's uh like Steve munish the uh Secretary of the Treasury was not pro crypto in fact people forget but during like The Parting days of the Trump Administration he was actually trying to like pass some sort of administrative State lawfare

against uh you know self- custodial wallets that that was like a nightmare scenario he wanted to uh they they wanted to um require reporting on un un uh unhost wallet transactions if they were over like $3,000 so you were going to have to like effectively register your Tre or your Ledger with with the finsen or with coinbase they were going to have to give over information it was kind of like a national crypto Reg his right we're going to get none of that this time around though you're you're like 100% confident of this yeah I think the only things uh that that are that frankly probably aren't going to be much different under Trump or Biden or Harris is relating to like the like the sanctions and Bank secrecy act I think you know because Trump and his team are so Pro crypto um probably be slightly

better but if you think about all of that stuff like out of finen and the and the um the the TFI the terrorism and financial intelligence office inside Treasury and and finsen and ofac like that stuff is on a very like hard to reverse snowball like post 911 bureaucracy where it's like and you could imagine some of Trump's foreign policy goals like bump up against like you know never sanctioning a crypto company and stuff like that I still think even on like big topics like tornado cash or Samurai wallet you still probably see easing in crypto's favor because those those are patently unfair as well I mean in the scheme of things right um but in general like I other than that it's going to be like a major Improvement I think maybe that's a

slight Improvement yeah o ofac and kind of finsen and the financial surveillance State it's like tied up into kind of National Security really hard to roll back back but I I do I do want to ask because not on Victor's list was the Rond storm case which is like top of Mine by the way for bankless listeners that was scheduled uh for December now that's been pushed back to uh April I believe and of course Roman storm is tornado cash developer rested from his home for the doj he deployed uh like a privacy smart contract and uh ofac made that illegal this is actually something that I've not heard Trump talk about but you have to kind of Wonder depending on who's running treasury whether would they remove sanctions from tornado cash I I would guess likely not but will they

at least drop charges in the reman storm case or like would Trump even pardon him we have uh Ross alri on the list as as someone he intends to to to Pardon this is a campaign promise I believe what are your thoughts on this it it's sad when something's so important to people's lives and and and ALS you know Ro Roman's life obviously and and but also you know Liberty I think on its fa is subject to such sort of political minations right there is going to be a point where it's like I don't know where that line is but where it's not politically helpful for the Trump Administration to do certain things and so then you're looking at like well you know maybe even we agree with it but we've got to get this other bill passed right now we don't have time to like go

to war on this issue like and and I think the problem for me with tornado cash and and frankly some of Samurai is on a principal basis what was done I think is very defensible right like releasing autonomous software it's like going after Microsoft because like Al qaa wrote a memo in Microsoft Word right there's and I really think it is like that on the other hand like there's those there's chats they never blocked the frontend front-end uh when they knew they could like there are bad facts there that speak a little bit too intent rather than now they're not facts that actually matter for what the charges are in my opinion right so it shouldn't matter I think if you're Roman you hope if that goes before a jury though there's going to be plenty of of stuff

for for you know prosecutors to point to that make them look like Bad actors right and so I think and and also I'm not an expert in this but like doj historically has been one of the more independent you know cabinet level agencies at the federal government it's not clear that like the president can call up the US attorney of wherever and be like drop the case um he again he might try probably I mean we don't in the scheme of things right we do want some separation here a prosecut um prosecution ability right um of course and kind of the court systems this kind of thing but he can definitely pardon he can pardon can pardon yeah this brings up the question because I believe there was a campaign promise

about uh like pardoning Ross uh for example but not just that there were a number of other campaign promises that Trump basically made right he went to the Bitcoin conference and said all sorts of uh things right including like um buying Bitcoin was make he said he was going to make America the crypto capital of the world and in the Bitcoin like center of the universe or something okay okay so he's written some checks during the campaign as all politicians do and now the big question I think uh you know we have to ask is which of those C checks is he going to cash because to to our comments earlier of course all of these things require some amount of political Capital now there's a clear mandate I think and like um he'll have a lot of ability so have uh

hordes of of political Capital will he keep these campaign promises which of them do you think he will keep which of them won't what's his track record of keeping campaign promises um it's it's okay um his track record I think between the 16 election and his first presidency um he he also and I think people know this obviously we've all been watching Donald Trump now for years he he likes to stake out um really firm positions as a negotiating tactic in general whether it's on tariff a great example right is going to add all these tariffs by the way same exact issues on the table in 1892 when Grover Cleveland was became the first president to win a second non-consecutive term immigration tariffs hard money it was a big silver thing

back then and and similarly like the the American manufacturing base would benefit I think from foreign export uh import tariffs right but you know that could cause a lot of inflation like there's there's issues with this I think he's made he and his serrats have made very clear like that these are negotiating positions he Stakes out I think you'll see that similarly on on other issues so it's not so much that he he uh on some of these issues won't deliver but that you know coming out strong and then you know trying to be smarter is is what I saw some of on some of these issues on the last one immigration too I mean rightly so like this is a very contentious election with some serious issues right outside of crypto and you know people are like what it going to deport 12 million people I

mean they've already started saying like we're going to start looking at like the 800,000 or so like known criminal aliens that like the Biden uh Administration says are criminals right like so I think you're going to start to see like come in a little bit and get a little bit more tactical take on crypto um I think something like a free Ross is very easy this guy has served more than 10 years in jail already he's not going to be pardoned he'll probably be offered clemency right which will give him his sentence will be commuted so he'll get time served it's not like it will come off of his record right most likely because he doesn't have to and by the way I'm sure Ross is fine with that right I yeah he'll at the end of the day if he's out he's out because the slogan

is free Ross day wanted I mean he has said he'll pardon Ross alri but I I think that's mostly because like Americans don't broadly the differ I'm learning that difference right now yeah in commutation um I think he's gonna do that he said it so many times he said it at the na remember he went to the National libertarian party's conference and pitched them which I thought was a very uh fascinating speech and he said it there and that was what the Libertarians clapped for and screamed for I think that happens I think the national Bitcoin stockpile is something will happen I I think it's not likely this was the almost direct parallel to this other election I keep talking about you know he's the only president ever to win then lose his re-election and then win again he's the second president ever

Grover Cleveland was the first and and Grover Cleveland Benjamin Harrison the president in between it's kind of the same in Reverse um there was this huge question about whether to back the dollar with gold or gold and silver and both were legal tender but only the dollar was only backed by gold and and the value of silver was fixed uh in a legal ratio to gold right so the market value could fluctuate but it was always tradeable and redeemable at this legal fixed ratio so when when silver uh traded below its legal fixed ratio everyone would try to pay for everything in silver because it's gresham's law right you're basically getting relief like so you could pay your taxes in silver so when it was actually trading below its redeemable value everyone would pay their taxes in silver and the

government would see a huge inflow of silver but then foreign creditors all wanted gold to repay the debt so then a huge outflow of gold so then there was this massive issue of how to back the dollar and uh Benjamin Harrison who was in between he passed this thing the Sherman Silver Purchase Act which was directing the government to buy a bunch of silver it's not unlike the national Bitcoin stockpile right so I I think he'll do something I think he's also very vocally been the only dollar candidate right he's been saying we want a strong dollar the dollar is going to be huge I think if you were to buy like toothpicks to back the dollar it would harm the value of the dollar doesn't matter what it is the second I mean fiat currency is is it's a confidence game

right I mean it's it's backed by nothing but faith and credit I mean but he could just stop selling Bitcoin because that's been a policy right the US has like 200,000 Bitcoin plus I think that's why that's what his proposal has been his proposal was that he said never sell your Bitcoin everyone knows this so we should stop the government selling that that is much more palatable I think than directing buy it I think I mean he may they may buy it I think the government should buy it but it's they've got to be very careful um to buy it for to Telegraph what the reason messaging us as yeah if you buy it to back the dollar then people the dollar is going to Plum it and no one wants that like you know it may it's gonna happen eventually all Fiat currencies do collapse but there's

no need to accelerate that unnecessarily so I think you'll get something on that I think um I mean again on all of the executive gency stuff I think he's likely to deliver whether we get any we may never get any um like Progressive legislative package pass Market structure stable coins so you may end up just with a situation where you have regulatory relief but no new clear framework um in fact we were we our I think our Baseline hypothesis is that the more unified the branches of government like let's say Republicans take the house also and you've got all three branches are Republican very unlikely I think that you see something move on crypto in the first two years because wait really like I thought this like part part of Victor's like

statement is um uh like notice it doesn't say Market structure I think stable coins has a lot less hurdle here pretty much I'm just assuming if everything like goes the way it's looking they're gonna work on other stuff they're gonna do taxes they're gonna do all these big giant Republican things we're gonna get St coin though we're gonna get fit aren't we I'm not sure I think fit is fit is more like I these are great deal making bills right like where there's a lot of bipartisan I think if you get a if you had a Harris wave across all both houses uh in Congress and the White House or Trump wave crossbow houses in the White House they're going to focus on like high priority dollar spending stuff they're going to do they're going to try budget

reconciliation do big giant tax cuts these things take a long time to move through conf uh Congress right I think there's more air in the room in space to do something that's a little further a field like crypto if you can't do those big things now you're looking for bipartisan stuff so the irony is um you're going to get relief I don't know if we're going to get a framework in the like out of a a unified Republican government it's possible certainly I think I don't I can't speak for Victor but when it comes to stable coins versus Market structure right he doesn't say fit 21 here to me I I I think the the daylight between Republicans and Democrats on on stable coins is is much less than uh on Market structure right pretty much the only dispute that we're

aware of out of house Financial Services between Maxine Waters and Patrick McKenry has been about which banks can do it and which entities right like the the Democrats Wanted only National Banks that the FED uh directly regulates right and the Republicans want a state pathway right so to me as far and perhaps even non-bank entities right like why couldn't Walmart issue a stable coin I don't know but Republic but like that's the dispute I think on like what they hold in order to back it and like what disclosures have to be made and frankly even like what Regulators would over see it like that's table Stakes there's a lot of agreement there so I think and then by the way if you throw in you know Howard lutnick the head of the transition team has all of tether's you

know treasury collateral if he's going to be important like there there are also dollar uh strength reasons to do stable coins so I think that's more likely than uh in a Republican government than fit 21 um so yeah it's it's kind of a paradox I think they're just GNA they're going to do immigration and taxes and who knows what else but but crypto and that's you can imagine that if Trump uh delivers on regulatory relief on these issues at the agencies that they say look guys like now we got to work on other stuff for a little bit like you got a lot of what you wanted right right right right right I think in a in a in a divided congress with a trump presidency you're very likely to see a good deal struck on this because it doesn't and by the way we want it to

be a deal you don't want some right unanimous secur has lasted for decades because it was bipartisan right like you don't you want we want crypto whatever comes out of Congress to be bipartisan whether or not it's Unified Government or not like it should be bipartisan you don't want to ram through it's GNA be hard to tell the crypto industry this right but we don't want to ram through something that's like unequivocally B like too easy for us too bullish for for crypto like you want it to have longevity Alex I want to get your take on the impact of this election on Silicon Valley uh notably Silicon Valley has moved far more right than it has previous ly previously when I was you know growing up in the th in the early thousands and into the um 2010s Silicon

Valley was known as liberal it was known as blue uh and that was not the case this election uh notably um Mark Andre and Ben horo put out this very very Pro Trump podcast about why they are supporting Donald Trump which was just a very big move to come out of Silicon Valley Elon Musk putting all of his marbles on on Donald Trump uh there were tweets I thought this tweet this morning was pretty funny from P McCormack where he says insane how lucky Elon keeps getting uh which is fous his tongue and cheek he's like no Elon Elon makes his own luck uh and now now Elon is like very very tied to this Trump presidency uh he also now owns Twitter and is landing rockets and catching them with

uh with chopsticks uh and this guy has like the ear of Donald Trump who has now won the election what what would you say is the impact upon Silicon Valley and the Texas sector yeah this is a really interesting one honestly because like um you know you're seeing some winners and losers and the in the tech stocks um and you know I I think I you know you mentioned David when you were growing up that Silicon Valley was liberal I I also recall that Wall Street was conservative and Republican but most of the big Banks and big Bank employees are big Democratic donors today it's kind of flipped I think um look I yeah I think look JD Vance I think is instructive here right he worked for Peter teal um he is what I

would describe as a almost a classic techno Optimist um I think you're going to see um a much bigger focus on Innovation and and maybe relaxing of some of the um anti-trade stuff that sort of prevents the growth of some of these companies and you know Venture exits for example right I mean we haven't had I don't have the data in front of me but the the public IPO Market has been just lackluster right under this last ad Administration you're probably going to see a lot more companies go public that gives the exits to the VCS that can keep the machine moving so I I think it's going to be very positive for American Tech I think you're going to see um AI is going to be really interesting what happens with AI because Europe is classically taking

this overregulation standpoint America looked poised to maybe do the same talking about an AI safety counil and all this stuff I mean again I don't want to be ruled by robots either I want it to be safe but like you know that's sort of orwellian AI Safety Council who knows what that means sounded like a lot of Regulation probably going to get some relief there um so I I think it's going to be pretty positive for Tech overall for American Tech I think you saw basically every major Tech leader hedging at least right I mean Zuckerberg called uh Trump after the assassination publicly praised uh his you know bravy and wrote a letter to Congress saying that you know we were pressured to censor during covid I mean Ben Horwitz

too David I you you mentioned the podcast but he sort of like pivoted uh more recently you know three or four months out and said hey I've I've donated to the comma Harris campaign but ba Bezos like declined to allow Washington Post which he owns to endorse like synar from Google Trump said on the Rogan podcast that Google CEO had called him so like they've obviously been sort of like at a minimum were hedging for a trump yeah they were they were yeah so I I think they they you know they're look they they want to grow I think the the big question for me with tech like and let's go to Elon too with like X like uh and he really did go all in it's incred I love I do love that tweet from pachy because I mean Elon even I mean I

was it's stunning how how much money he put into it how much time um I think like the social media censorship questions um both parties there was a period where they both wanted censorship maybe for different reasons or they're both mad at like Facebook either for censoring like anti Co lockdown speech or for censoring Donald Trump content right but both were or for censoring like alternative coover like both parties were mad about this right and there was all this discussion about section 230 and if it would be repealed which limits the liability of those platforms legally I I think now you're you're looking at some kind of reworking and rethinking among the tech firms about how they do on uh you know content moderation again total Divergence from Europe on this total Divergence as as we

start to draw this to a close Alex one question I have for you is uh uh ETFs so Gary Gensler out of the way right so it took so much work to just get two freaking ETFs out of this guy and the SEC now Gary Gensler is going to be gone do ETFs uh magically start happening do we get an ethereum like e Stak ETF do we get like kind of the long tail of other uh ETFs as well the floodgates just open or is that still a process yeah it's definitely a process I think um It's Tricky I mean I think there's a lot of work to be done I think you you need some movement and whether it's no action letters or a new framework imposed or legislated at the secc on tokens and are

they Securities and those questions before you start to see the floodgates like I mean they there's literally just even if they let's say it's you know if they could just wave a magic wand they'd still have to wave some of the underlying magic wands first so like there's some time I think it takes but you know if you if you ask me four years from now like whether we have only have two crypto assets with ETFs or if we have 20 like I'd be leaning towards 20 at that point so there's a lot to be done but I if you ask me to bet I'd say you know we're likely to get more this is a a take from and's taking by the way too just to answer that other question like there's some procedural stuff right people have talked about whether you know the the thresholds with which ETFs

can lend their underlying collateral and maybe that's a comp that should be looked at for staking I think right the main one of the main issues for allowing the ethereum ETFs to stake is whether or not unstaking could happen fast enough to meet Redemption should they occur I see so you could see like theor let's say that you have a bunch of proof of State coins that have ETFs you could see the SEC look literally at like exit Q times like on ethereum right on the but these are all valid things right yeah it's valid I I I think it's on the table I mean I think you know and that's been I don't know if that's the main reason why the ethereum ETFs have underperformed flows wise to the Bitcoin ETFs but it's definitely one of them right if you're sophisticated enough you can buy ether and put it on coinbase and

just earn your your staking uh rewards like why wouldn't you do that is that much harder than buying the ETF well it is for all those old reasons about the ETFs you know financial advisers can't do that for their clients but I I think that would make those products much more compelling and competitive yeah uh well let's talk about this as we draw this to a close then so the and the death of the anti- crypto Army is it kind of over for them here's a tweet from Justin Slaughter uh overheard from a Biden White House staffer he says so this is Rumor Mill territory but um this is what the Biden White House staffer said no Democrats are going to fight with crypto to the death anymore we have too many other things to worry about and crypto clearly has more staying power than we

thought crypto clearly has more staying power than we thought so Elizabeth Warren famously came out with the kind of the anti-crypto army she amassed some recruits including like much of the the Biden White House administrative uh state are we calling that dead now does do you think the Democrats in the wake of this loss this uh I think you know Obama at one point you like called the loss of shellacking they got shellacked this election they just got absolutely destroyed do you think that this causes them to call off the dogs with respect to crypto so my hope and our hope all along has been Alex that crypto crypto should not be a partisan issue it's silly that it is right and uh I think there's a a subset of of Democrats that

you can kind of blame for this some Republicans too there's a subset of people in politics you can kind of blame for making this a partisan issue in the first first place but the ideal state is it's not it's like the internet like how can you be elected as a politician in the United States if you don't support technology the economy and the internet right like that's just should be a non-starter so are we back to that as The New Normal so being anti- crypto cannot win elections and the Democrats kind of re regroup in the wake of this and they change their platform I'm sure they're going to have to reform a lot a lot of introspection hopefully for them in the wake of this but um the conclusion of that is they're Pro crypto yeah I think um very very unlikely you see high-profile uh members of Congress

or elected officials take bold uh uh stands against crypto it doesn't seem like it uh is a good idea again Bernie Moreno I think is the his victory over sherid Brown in Ohio is the clear signal I mean this is not a back benching senator who got oust it this is a very very prominent one and um you know I and and you've already seen I think a16z in coinbase you saw like maybe yesterday the day before have already pledged a combine 50 million just to play in the midterm election in 20 so like two years that playing the long game exactly so I mean I I think look this is how politics Works in America and like not only did the crypto industry deploy significant uh Capital to to influence and support their candidates but they succeeded and

that speaks volumes why come out of you could just say nothing right I mean I we talked about this even on this show before but like I don't think there's a lot of anti- crypto voters I mean there's maybe many Americans who don't like crypto but they're not like that's not what's motivating them to to vote they don't care you know yeah I uh all right well um we we'll see what happens next but Alex this is this has been great and I think for everybody out there uh regardless of who you voted for right um I think anyone who's an advocate of crypto can be happy at the dismantling of Gary gendler and the administrative state that has uh attacked this crypto industry for so long and it seems like that reign of terror is over so I gotta call this a overall a big victory for for crypto on

the back of this Alex Thorne thank you so much for joining us today Ryan David thank you so much for having me got to let you know of course this is not a political podcast none of this has been political advice it's not um like buying or trading advice either crypto is risky you could lose what you put in but this is the frontier we're glad you're with us on the bank list Journey thanks a lot new projects are coming online to the mantle layer 2 every single week why is this happening maybe it's because mantle has been on the frontier of layer 2 design architecture since it first started building mantle da powered by technology from Igan da maybe it's because users are coming onto the mantle layer 2 to capture some of the highest yields available in Defi and to automatically receive the points and

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