Crypto is macro now: Bitcoin's role in the new global order

Transcript

GM, good morning. Welcome to Milk Road Macro, the weekly macro show that knows that Elon verse Trump is yet another example of a happy couple being torn apart by too much spending. I'm your host, Jay Hamilton. It's Wednesday, July the 2nd, and today we are joined by Noel Aes. She's got 10 years of experience in capital markets. She's a former managing director of research at Coindesk and now she's the author of Crypto is Macro, which has some of the best coverage of the intersection between, you guessed it, crypto and macro trends. Today, we're going to get Noel's thoughts on the role that crypto is playing in the global changing order. There is a shift happening in power right now, a shift

happening in monetary policy, and Bitcoin is playing a big role in that. And Noel likes to say that Bitcoin is the truth machine behind what is happening in the global changing order. We're going to talk about that. We're also going to talk about a crypto catalyst that could drive big flows which no one is really talking about, but Noel pointed this out in a recent newsletter. And finally, what's really going to make Bitcoin go higher in the next rally? What is Noel see coming for the next few months? Before we jump in, macro is confusing. I know that, you guys know that, and we are doing our best to fix that for you on a weekly basis with this show. But beyond this show, we also launched the Milkro Macro newsletter. It's twice a week in your inbox. Short, simple, to the point to

help you understand the crazy wild world of macro and make sure that you're staying up todate. Hit the link in the show notes to subscribe. Today's episode is brought to you by Nexo, the platform that grows your crypto without locking away. It's also brought to you by Letin. Get cash without selling your Bitcoin. Without further ado, Noel, welcome to Noel Road Macro. Jay, so good to be with you. Thanks very much for having me. I'm still chuckling about your Trump Elon joke. It was excellent. Shout out to John who's backstage for coming up with that one. Uh let's start with um you you you you named your newsletter a very interesting name to me. You named it Crypto is Macro. uh which a I love because that is literally the exact I I

should have named our show that that is perfect. Uh but I'm curious what you mean when you say that. What do you mean when you say that crypto is macro? I've been focusing as you have also Jay and many of your listeners have also on the macro impact on crypto markets. What rates are going to do, what Powell is saying, what the institutional investors when they finally get here are going to be doing etc. You know, we've been hearing that for years, but it I've been having I' for years I've been more interested in how crypto is going to impact macro, how blockchain technology, crypto assets, new types of marketplaces are going to impact the way traditional markets work and the way global

economies are going to be treating monetary policy. That crypto is macro now. It's not just the macro crypto directional impact. It's the crypto macro impact that is increasingly becoming important. And I got to be honest with you, Jay, I'm a bit taken aback by how fast this is playing out. H interesting. You what do you think uh what did you expect in terms of timelines and what has led to the speed or this change in uh in transition of those timelines? Well, obviously a big deal was the regulatory shift in the United States. the change of mood with the results of the election in November.

But it would have happened anyway to be honest simply through attrition, simply through institutions finally buckling down and doing their homework and understanding that this asset class offers something new. Professional investors always looking for something new, the edge, the alpha. And when the institutions get involved, the regulatory organizations tend to follow behind. So it's accelerated because of political developments not just in the US but uh starting there and rippling around the world but it would have happened anyway simply through attrition because the use case has been obvious to many of us from the very beginning.

It's so true. It it certainly it ties into a theme that we've been talking a lot about recently on the show, which is that this if you've been in with if you've been within crypto for more than one cycle now, this cycle is very different than past cycles. And one of the big reasons it is different is because the institutions are here, regulation is coming, legislation is coming, and we have bigger players in in this market in a way that we haven't. and we're a mature market, which we really weren't a mature market quite yet. It was this cycle, especially with the Bitcoin ETF that really helped us hit that maturity. I want to but I want to I don't want to focus so much on crypto yet. I want to focus more on macro and then we'll we'll come into crypto throughout the episode. Uh right

now macro is macro is always a complex and a massive topic to discuss. Can you give us your 30,000 foot view of how you are thinking about macro in 2025 right now? A lot of noise. There's that. But that's why your 30,000 view idea matters more than ever and I recommend to everyone. Sure, the noise is interesting and we all get addicted to the adrenaline. But uh taking a step back and understanding that the noise doesn't actually matter. What matters for portfolios, for individual savings, for retirement plans is the longer term. And the longer term is one of currency

dilution around the world largely due to geopolitical uncertainty. And it is also increasingly going to be due to financial manipulation is I guess a kind way of putting it. And by that I mean financial repression certainly um stimulus definitely capital controls for sure and that is the bigger picture. The unemployment data we just got some ADP figures out earlier today which were much worse than expected. Market doesn't seem to care at all because even the market seems to be understanding that noise the bigger picture matters and we've all heard the saying nothing stops this train. I it is definitely that but I would extend that even further. It's

that at a global level. Yeah. I want to actually this perfect segue into what I wanted my next question is you've talked a lot about how the the global order is changing. There's a lot of there's a lot of old institutions, a lot of uh ways in which central banks communicated, ways in which our monetary policy and our economics were controlled which are shifting right now, but they're shifting slowly. Ray Dallio also talks a lot about this. I'm sure lots of our listeners have listened to Ray talk about this or read his books. What's your view on the old order and how that is changing right now?

Nobody likes to give up power and that is I think one of the big catalysts coming up. Power shifts. It always does. Ray Dalio is definitely on to something. And I know you've spoken about this before Jay as well. Power shifts largely because of building frustrations and satisfaction and the power of the ballot box if we're lucky. And those in power don't want to let go. We've seen that in the world's leading democracies and we've certainly seen it in countries that are less democratic. Where there is repression, there is resistance. And repression again has it's a spectrum obviously. Where there is repression, there is always resistance. And that leads to the uncertainty that highlights some of the

narrative supporting the crypto market at the moment. And so that going back to your earlier question, that is the bigger picture here. It's not so much about when the Fed is going to cut rates. I don't think that matters actually. It's not so much about what the unemployment rate is going to end the year at. I don't think that's relevant either. What matters is the growing social disscent, the growing social unrest, the growing financial repression, and the shift of the axes of power that we're seeing. Uncertainty is going to be the defining part, the defining narrative of this interregnum.

And none of us know what's coming next. And which is why we should plan accordingly. Okay. And what is what is Bitcoin? And and you could extend beyond Bitcoin to crypto's role in that in that space. And I I like this term that you've used that Bitcoin is a truth machine. Give us some unpack that for us. Let's focus on Bitcoin because so many of us and I'm guilty of this myself. We say crypto when really we mean Bitcoin. And again, we'll come back to this, I imagine, but it speaks to your u comment on the maturity of the space. I would argue that we're not quite mature. We're more mature, but we're nowhere near mature yet because right now there's just a lot of again noise and confusion and chaos.

Many different narratives. Good thing. That's a good thing, but it is also very confusing for the institutional acceptance that we hope will bring a lot of liquidity into the space. But going back to your question, so let's focus on Bitcoin. Bitcoin is the ultimate store of value. Yes, it is also a risk asset and I can explain a bit further along why it is both of them and should be both of them. But right now, let's focus on the store of value narrative which is what's relevant really for the longer term uncertainty. Bitcoin is the only liquid asset trader today whose price has nothing sorry whose supply has nothing to do with price. Nothing at all. Even gold, its supply goes up when the price goes up. And when gold is at, you know, $50,000 an ounce, it would be

it'll be economical to extract gold from seabeds and from asteroids and who knows what else from seaweed. I don't I don't know. But um Bitcoin is Bitcoin's supply schedule is not only transparent, verifiable, it is unaffected by the price. And that is the ultimate characteristic of a store of value. something that we're seeing more and more longerterm investors understand more and more nation states are understanding this also. So when you are looking for a way to rebalance a portfolio of reserves, savings, pensions, whatever in the face of colossal uncertainty, then you go for something that you know is not going to be vulnerable to either price surges or that is not going to be vulnerable to

manipulation from those that issue it or that is not going to be vulnerable to politics or even financial repression. And that is gold to some extent because that's the familiar asset and that is also Bitcoin. Now, that is one bracket of thesis that I'm sure many of your listeners are familiar with, the store of value. But the uncertainty in the world is also relevant for those that see Bitcoin as a risk asset, which it is also. And that is in times of uncertainty, especially when the authorities want to hang on to power, they're going to print, basically print, not only because of the growing uncertainty leading to a greater need for defense spending. We're already seeing that and it's just getting

started. But also, you want to keep people happy. So, you're going to give them free lunches, theoretically speaking, or maybe even literally speaking. I forget who it is. There's Oh, Indonesia is trying free lunches now, and that's not going too well. So, where is this money going to come from? It's going to come from currency dilution, which leads to the store value thesis, but it's also going to come from stimulus, which will flood the market with liquidity, and that will push up asset values. And Bitcoin is again arguably in theory one of the most sensitive assets to risk sentiment because it doesn't have any cash flows and it has no variable inputs.

Where where do you think Bitcoin is in its journey between being this store of value asset versus being this risk-on asset? because we love to talk about every time there's a a macro event, every every crypto Bitcoin person comes out and says, "Oh, Bitcoin's decoupling. Look, it's not following the NASDAQ. It's not following the S&P anymore. It's not right. We love to talk about that, but then we always get proven wrong and it's still I think you you you really did explain it well. It does sit in both camps, but where do you think it goes in the future? Does it stay as both of these? Does it continue does it grow more into a store of value asset? How do you think about that in the in the

coming years? In my view, it's both. It and it's more as well. I mean, I personally hold Bitcoin because it's a new technology. That is one of the narratives that is very overlooked in my opinion. It's a new technology and it's a store of value and it's a risk asset. I personally very I'm very excited about the new technology side of it. However, coming back to the the both I mean and the two main buckets are store of value risk asset. The reason it's both is that it has the characteristics of both. That means it will generally continue to behave like a risk asset because risk traders tend to be more active than longerterm investors. Those that see it as a store of value, they're going to buy it and they're going to suck it away and forget about it, right? And again,

that's one of my thesis as well. But the risk traders, they churn and price is always set by the last trade. So they are the price setters and for them Bitcoin will always be a risk asset because that's the way that's what they're looking for and it's good at that. It's volatile. It is not sensitive to any of the traditional inputs that other risk assets tend to be affected by. So as long as people see it as a risk asset, it will behave like a risk asset and there's nothing on the horizon to stop them from seeing it as that. And it will also increasingly, especially given the growing awareness and especially given unfortunately the growing need, it will also always be a store of value. And here's why it will always be both. Because there's no one to decide that for us. There's no

marketing team. There's no boss that will say it's this, that, and the other. No one gets to decide. And that's one of the most beautiful things about it. Bitcoin is to any investor what he she whatever what he or she want it to be. And this may sound very handwavy, but it is actually really kind of amazing as well. It is a slight digression here. Also, what gives Bitcoin a floor way above any other risk asset? Think of risk assets generally and the floor for most of them, it's zero. But for Bitcoin, it can never go to zero because of its multitude of narratives. There will always be someone in the world who is willing to exchange Bitcoin for some

reason. Someone will want it as either a store of value or a payments technology or a risk asset and no one can switch it off. So therefore, somewhere in the world, Bitcoin will have value. And again, are there any other risk assets you can say that of? No. No, certainly not. And it is it's interesting that you brought up that third narrative, the technology innovation narrative, and you bring up payments, right? You know, the original white paper aimed for Bitcoin to be a method of peer-to-peer payments, right? That was it was basically what stable coins has become. Now, does it end up being that? I don't know. There's a lot of people experimenting. There's a whole L2 experimentation happening on Bitcoin. There's NFTs on the amount of

experimentation on Bitcoin is enormous. So, that innovation narrative is also interesting. I don't think a a lot of people don't really pay attention to that or talk about that because the store of value narrative is taken over and become so big especially with the ETF does the the one the one thing that comes up for me is a lot of these store of we really want those investors who are in Bitcoin want the store of value narrative to grow because we look at gold and we say okay great if if we can hit gold's market cap if we can be 20 trillion 18 20 trillion whatever gold's at today you know wow That's a massive increase from where we are right now for Bitcoin. You know, 10x increase. So, uh, and a lot of the predictions that we see for Bitcoin revolve around that is

that's one of the simplest ways to look at, okay, where do you think Bitcoin could be like 5 to 10 years from now? Uh, but I wonder though if it continues to trade like a risk asset, that volatility will scare away a lot of institutional investors who say, "Hey, we just that's not part of our mandate to invest in things with that much volatility. How do you think that through? I don't think that's an issue anymore. I think it was back in 2016, 2015. Not anymore. And the reason I say that is because just look at the derivatives market. There is a endless supply now of ways in which institutions can hedge their risk and they know what they're doing so they'll know how to do that. And this is even going this going

to continue to progress once perpetual futures are traded freely in the United States of America. It's not an issue anymore because of the sophistication of the market. The CME listing of futures was a of Bitcoin futures was a very big deal. Yes, it marked a top of the cycle, but that's largely because of the runup in anticipation. What it meant was that institutions could now get sophisticated on Bitcoin and that's generally a minimum requirement for them. Now, there are futures, a variety of them. There are options, there are all sorts of sophisticated products, even ETFs that can offer you hedges. So, it's not a barrier anymore. And anyway, Bitcoin's strangely, and I don't have a good

explanation for this, becoming less and less volatile. Bitcoin at the moment is roughly as volatile as stocks. And that is absolutely astonishing. And I was looking yesterday at the implied volatility index for Bitcoin. In other words, what options traders think is coming. and it is at its lowest point since 23 where nobody was interested in Bitcoin if you remember. So it's not that volatile anymore. I think the volatility will come back because again Bitcoin is a risk asset. Always will be therefore it always will be will be volatile because there's nothing to stop it from being so. And that's volatility of Bitcoin. Again, it's not a bug. It's a feature. You can hedge it away if you're interested in doing so. But if you are a risk trader, you want that volatility. When Bitcoin has low

volatility, generally that does mean a relatively low interest. That's where we are now. I which is why I don't think we're mature just yet and I don't think the institutions are as active as they will be in the second half of the year. Largely because again the market's sort of on pause. It's like we're all holding our breath. If long meetings and judgmental bankers are your thing, Nexo is probably not. Nexo is a premier wealth platform built for people who value their time and money. It's built for people who have idle cash lying around and want it to grow fast. Whether it's Bitcoin, Ethereum, or even Forex pegged assets like USDT or USDC, Nexo offers up to 14% annual interest and access to cryptobacked credit in under

24 hours. Your assets need a platform built for growth. Join Nexo. Selling your Bitcoin should be a last resort when you need cash. That's why there's Leen, the trusted platform for Bitcoin backed loans. You can unlock cash in as little as 18 hours with no monthly interest payments and no prepayment penalties. They've issued over 9 billion in loans and never lost a single satoshi of client funds, even during the chaos of 2022. If you're a long-term hodler, this is the move. Get liquidity without selling at milkroad.comlet spelled led.

Yeah, let's let's talk about that for a second. Let's zoom into this year, where we are right now and what you see coming for the second year. Why what makes you say that we're on pause right now versus we might have more action in the second half of this year? What's coming? What catalysts do you see? Well, right now again, not much has happened. Bitcoin's bouncing along within a range. Every now and then it'll break up or break down and then go back to its range bouncing along and and this is surprising given the tailwinds. There are just a lot of tailwinds building up and we are hearing headline after headline of treasury uh purchases. You wonder where's when is the buying going to start moving the price? Logically it should. I think what we're seeing is we're just in a

transition phase. A lot of people who bought at very low levels have been selling, taking profits. There's some shuffling going on, some rebalancing as well because Bitcoin has done so well. And we haven't yet got enough momentum to break to the upside. And it's easy to say, I mean, you and I have followed previous cycles. You say that when it starts moving up fast, it will really move. And but again, this cycle is different as you pointed out earlier. So really don't know what could happen second half. I do think we're going higher in the second half. And again, this is not investment advice, but I do think we're going the tailwinds are strong and there aren't really any headwinds other than the kind of meh confusion that we're seeing in the market at the moment.

We should uh that's that's why Bitcoin needed a marketing team to to settle the meh confusion. Everybody can use a little a little assistance with the me confusion when it comes to new tech. Uh I want I want to chat about a few catalysts. Um one is what you've talked about before which is nothing stops this train all ends all roads lead to currency debasement and governments printing money. What's your thoughts when you look at the major economies right now? Big beautiful bill has passed through the Senate. It's led to this massive war between Trump and Elon as I joked about earlier. uh what's your thoughts on you know if you look at Japan if you look at the EU if you look

at the US if you look at these if you look at China m these major economies do you think that they're going to start printing stimulus printing money where do you think they go over the next year def the answer is definitely yes and we're already seeing it and I'll you know obviously I live in the European Union I live in Spain so I can talk more personally about that but even just looking at what Japan is doing what India is doing what Taiwan is doing I mean we're seeing this pretty much everywhere. And okay, coming over to the EU, and this ties into something else I was referring to before, the financial um repression is probably not the right word there, but you'll see what I mean in a second. Europe, one of one of the best things that could have happened to Europe, I should say, was the speech

that JD Vance gave in Munich, I think it was in February, where he pretty much told Europe to, you know, take care of yourself and stop, you know, living off of our generosity. He phrased it very differently, but that was the overall message and it was a big shock to Europe that is generally guilty of assuming that things will continue the way they are. Europe has a reputation for being fairly conservative and slow and to be honest, it's fair. That said, they have galvanized and it's not easy for them because they have to change their way of thinking and their ch change their way of managing the economy. Again, this is not easy for Europe to do, but they are ramping up spending. I mean, even just looking at the recent results of the German election, that's an example. I

mean, Germany is now building up its military, something that we didn't think we'd see in our lifetimes. And we're seeing huge ramp up of military spending along the border with Russia as well. So, it best thing that could have happened because it is forcing Europe to actually stimulate and arguably it is very needed. But here's where okay, and that brings in the whole currency dilution, etc., etc. But here's also where the financial repression part of it comes in. Um, I don't know if you noticed, but I think it was a just a few days ago, the European Union put out a post on X saying uh talking about the urgency of retail savings to help Europe achieve its economic goals. You you're retail savings have to be harnessed to

help Europe achieve its economic goals. And so all of us retail savers, we're thinking, wait, what now? And just how are you going to go about doing that exactly? And it is a reminder that when backs are against the wall, authorities are going to do whatever they feel they need to do to get done what they feel they need to get done. And if that means not confiscating savings, but directing their direction, then they will do that. If it means um you know taxing certain types of investments so that money doesn't go there, they will do that. And this is where this is the big reminder of the value of freedom of choice when it comes to your savings, your right to do what you want with your own money, etc., etc. And while we can definitely

say that has to be a fundamental principle, we also know that pension funds are not going pension obligations are not going to be met going forward. So things have to change. And this comes back to the sort of chaotic interregnum I was mentioning earlier. things are heading right into a nothing stops this train. Yes. Um you know Lyn Elden coined that and hats off to her for that. My response to that is well global. Yes. But I want that something will eventually stop this train. We don't know what that is. It's not going to be polite but something eventually will because nothing goes on forever. Yeah.

Cuz like some of those statements that you make there are they're shocking statements, right? They really smack you in the face and make you go whoa. But the thing is right now I still everybody doesn't want to take the hard pain right now. I mean definitely not the the leaders. They're I mean they're never going to take the hard pain as you said. They're going to push the buck down the road and do whatever they need to do to settle it now and their in during their term in office. And so and then and the people I think as you said there's a growing narrative and a growing trend of feeling uh that this isn't fair anymore and that we need change but it's not it's not at a tipping point yet right it's still feels early. I don't know if

you see at least where I am in North America I don't feel like it's at a tipping point. I'm in Canada so maybe it's Canada's very very easygoing you know relaxed laidback country but I still don't Long may that continue. Long may that continue. Yeah, I mean again it depends how you define tipping point. We are accustomed to thinking that a tipping point is a moment with a before and an after. But what if a tipping point when it comes to civilizational arcs is harder to spot? What if a tipping point is for instance when Germany's faright party starts leading in the polls? What if a tipping point is for instance when the UK's far-right party starts leading in the

polls? Those could be 20 years from now when our kids are reading this through the history books. Those could be classified perhaps as tipping points that we don't really see in the moment. Now, mercifully, we live in democracies. Mercifully, things have been fairly they've been stable democracies so far, but again, you just need to look at a few history books to realize that that isn't a guaranteed state. And we have seen here in Europe cases where when the authorities don't like the results of an election, they'll cancel it and they have threatened to do so again. Now in Germany that didn't happen, but it doesn't take a big leap of imagination to think that had the AFD just gotten a

few more seats than that election could have had a a reset or something. You know, again, we didn't have to go there, thank goodness, but it's not hard to see that happening next time around, which isn't that far away. Plus, we have elections coming up in the European Union soon. And while they tend to just be straight down the middle, fairly conservative. You don't mess with such a big organization, things are getting weird and people seem to want change, polarization, which is what we're seeing. What you're seeing arguably in the United States, what we're seeing certainly here in Europe, and what is also becoming more obvious in many Latin American countries and certainly subsaharan countries, polarization doesn't ever lead anywhere stable. Mhm.

And and just tying it back, all of this social unrest, this polarization, this change creates uncertainty and this uncertainty feeds into thesis for Bitcoin going higher in the long run. I want to talk about one more catalyst that you mentioned in a recent newsletter was you were talking about China and the potential of them softening their crypto trading rules. So back in 2021, for everybody who doesn't remember, China banned crypto trading. So you can't hold assets, you can't trade crypto. It's heavily enforced and it's just like a total countrywide ban.

But recently, there's been some things happening. What what's happening that is making you think there might be a shift? Because if they did shift this, this could be a large catalyst for crypto assets, massive catalyst, because there's no such thing as small numbers in China. And um yeah, I'll start with uh one thing that I was chuckling about early in the year is hearing President Trump talk about we got to get behind crypto because if we don't, China will win. And I can imagine the Chinese authorities going should we be looking at this now? So um but they have been looking at it. There have been many reports, many speeches and even some comments from high ranking officials that this is something they're thinking

about. It's not a priority. In other words, I don't think we're going to get any big announcements that crypto licensing is being ushered in the Chinese financial framework anytime soon, but it is something they're starting to think about because they know that crypto trading is going on. It is not illegal to hold crypto in China. In fact, recently a Shanghai court classified crypto assets as property. That's a big sign right there. Why would they do that? But it's so it's not a priority, but it is something that they know they're going to need to address, especially if the United States is terrified that they're going to win at this. They know that crypto trading is going on in um obviously in unofficial exchanges because there aren't any official ones. And surely they can see the sense of bringing the crypto trading

onto regulated exchanges where they can keep an eye on it. They know crypto is being used for capital flight. Surely it would make sense to make it legal so they can keep an eye on it. And they also know that there's just a lot of money to be made here. China has a a lot of excess renewable energy that surely could be put to use through state sponsored mining like it used to be back in the day. It still goes on, but it's sort of slightly, you know, hush hush at the moment. Imagine if that got some state some official fullthroated state support. imagine how how much of a treasury they could accumulate and this is at a time we know that they are working on diversifying their official reserves. So yes, I do think this is

going to happen. Over the past few over the past week even we've seen already some signs in Hong Kong. Hong Kong is not China when it comes to financial regulations. Explain explain this Hong Kong verse China because I think that for people who don't follow macro coastly they don't nec or don't follow Asia closely don't necessarily understand the unique position that Hong Kong has within China. Hong Kong is essentially a bridge. It is a separate legal and financial jurisdiction with its own set of rules and its own regulators and its own markets. And so it makes the rules for its financial exchanges and cryptospot ETFs are legal.

not very popular but they're legal and Hong Kong is right now working they're scrambling to get a stable coin framework in place and they're also working very hard on tokenization what we are seeing is growing interest from mainland Chinese brokerages in listing crypto ETFs in listing tokenized assets and in crypto trading in Hong Kong not mainland Hong Kong and mainland investors don't have access to these products unless you you fulfills certain requirements and that list is that list is slim but it wouldn't be happening without official approval. We've seen over the past week, China's largest uh brokerage, mainland brokerage, another

one of the top fours also, and a couple of smaller ones, mid-tier ones. I mean, again, no such thing as small in China, but we're talking as small as like 10 billion worth of market cap. Um, that's that's medium. Uh, they are uh operating they are applying for stable coin licenses, tokenization licenses, crypto trading licenses in Hong Kong. Some of them have already got um got those. So it they're noticing Hong Kong is a bridge as I mentioned earlier. It is also a sort of sandbox for China main mainland financial regulation. Hong Kong can be uh more out there. It can be further ahead on the risk and then China will see how it goes and then make its

decisions. Hong Kong is also a link between mainland and the rest of the world, which is presumably why the Chinese mainland brokerages are so interested in getting the crypto licenses in Hong Kong because they will be dealing with clients from pretty much all over the region. Yeah, a very interesting catalyst to pay attention to. as you said, not something that's going to happen tomorrow or in necessarily the short term, but you could see that if it did, if those regulations did change and the Chinese people could trade crypto openly, I mean, yeah, they would just be a massive, massive catalyst. I want to shift quickly to to stable coins before we wrap up here because a lot is happening around stable coins and I want to get your thoughts on the Genius Act.

Was the Genius Act a a positive, a negative for stable coins and for the future of digital assets? Oh, definitely yes. I mean, it's not perfect by any means, and everyone will have something that they absolutely hate about it, but just think about it. Jay, regulation that supports crypto creation in the United States, which is the world's largest financial market, is a pretty mindblowing concept. I mean, again, just think where we were a year ago. This is this is quite astonishing and again this isn't the world's largest financial market but stable coins again we're seeing a lot of frenzy about it. I was writing this morning about the stable coin frenzy in South Korea for instance which apparently is behind the South

Korean stock market being the best performing Asian market so far this year because of stable coins. I mean this is because of a token that has stable in the name yet they are still driving uh prices through the roof of certain companies that are applying for stable coin licenses. because we saw a taste of that in the United States with the circle IPO um this morning. I think it's 180% higher than the IPO price which is ridiculous. And again, South Korea is a country that is very crypto friendly as it is. Stable coin seems to be getting them really excited and we have to ask why compare what's happening in the United States with the Genius Act with what's happening around the world. And you know this is something that was uh commenting on earlier on in the year.

The important thing really in is not so much the impact of on the US stable coin and crypto ecosystems of the shift and the regulation, but it's the impact of jurisdictions everywhere else that will be scrambling to catch up and stable coins and crypto. They're global assets. So because of the huge shift in the United States, the rest of the world, which wasn't necessarily anti, but they didn't really see any urgency, they now see the urgency. And so we're getting stable coin licensing and crypto frameworks pretty much everywhere. And that means that crypto assets will be able to do what they do best, which is cross borders seamlessly and cheaply.

And obviously that is most reflected in stable coins. And what gets really interesting is one, not just the shift in how we see money, but two, the overall improvement in crossborder commerce at a time of the retrenchment of crossber commerce, if you know what I mean. In other words, if we're going to be trading less with trading partners because of the treat of globalization, well, let's make it as efficient as we possibly can because that way the the impact will hopefully be softened slightly. And this is again even before we start going down the innovations that we're going to be seeing again from everywhere of the utility of stable coins but also of crypto markets and other applications. We shouldn't forget

that stable coins again stable not going to affect the prices very much of crypto assets beyond the stables but stables number one use is in crypto trading. And if there is an easier way for mainstream institutions to trade crypto, then there could be more demand for crypto. In other words, if you've got the wallet anyway, if you've got the stable coins anyway, because it's now part of your treasury policy, well, you might as well hold some ETH as well. Yeah, it's a great take about uh it's very whenever I do an episode on stable coins, I won't lie, it doesn't do very well because most investors who are my listeners look at stable coins and they

say, "Well, I can't really invest in that, right?" It's you can. Before Circle, it was more difficult. Now with Circle, obviously, you have one very, very easy way to invest in stable coins. And there's decentralized stable coins that have tokens that you could invest in, many of which we talk about. If you want to learn more, you can read some of our recent pro reports. But the the overall take that I have is exactly what you have. Stable coin adoption is massive for crypto adoption and for a lot of our tokens that we do hold and also a lot of these stable coins are built on most of the L1 smart smart contract blockchains that are a big part of a lot of our portfolios, right?

Ethereum, Salana, you go down the list. So, it's it's always funny to me that people are not as excited about stable coin adoption as they but you framed it great. The impact around the world of everyone seeing the Genius Act and then Circle IPO. Like those two events alone are going to make every country pay attention in a way that they haven't before. And I mean, I'm I'm seeing it every day. I feel like I I'm talking to somebody who's trying to launch a new stable coin or trying to get involved in stable coins. So, the innovation happening there is just it's endless. And it will really I think you could argue that over the next decade it could lead to way more adoption than Bitcoin could lead to because it has way more innovation potential and the potential

to to touch every single person whereas not every single person is going to invest because there's a lot of people that just don't invest right now but everybody will likely be using stable coins. Not to mention what Stripe is doing and you know go down the list. Uh Noel feel feel free to comment on that if you if you want. No, I was saying absolutely and and beautifully said and I also throw another example in the ring. What Robin Hood announced earlier this week is a sign of why this matters because one thing Robin Hood have always done very well is the UX the usability you I mean most for most day trade or for most retail people buying a stock was something that your parents did whereas and you had to get an account with the broker and it's just a hassle.

You're not going to do that. You're going to stick with your baseball cards. But Robin Hood made it fun. They made it as easy as a swipe and that pushed the retail investment in stocks into onto a new level. It got it into the basement. Whereas imagine they're going to be doing the same thing now for crypto. I've always we've always said that we know that we've arrived when blockchain is not part of the question. when crypto is not even really part of the discussion, when it just works and there's no difference to most younger users between buying Bitcoin and buying GameStop or buying a gold ETF or whatever you want to do because you're

swiping and you're getting your little confetti or whatever you whatever incentive whatever incentive they choose. But the point being is extending on what you were saying there. If you have the wallet and if you have the stable coins and it's just a question of swiping then it's becomes literally becomes a a why not and you throw in the fun area of crypto as well such as meme coins. I mean yes they are crazy but let's face it they're meme stocks so why shouldn't there be meme coins? Investing doesn't necessarily have to make sense.

It's your money. You should be able to do what you want with it despite what the European Union may have to say about that. But it comes down to convenience and it comes down to simplifying. I mean, you talked earlier about how macro is confusing. Crypto is confusing. And if you're starting to talk to people that you know are not technologically um they don't have that mindset, if you start mentioning blockchain and start mentioning keys and they don't want to know, but if you just put it on an app, they're ready to go. It's so well said, Noel. It's been an absolute pleasure to get you on the show today. Thanks so much for your time.

Been so much fun talking to you, Jay. Thank you. Thanks so much for listening in everybody. I have to remind you as always that none of today's show was financial advice. I'm not your investment adviser and Noel is not your investment adviser. You should always do your own research and think before you make any investments. And if you need help learning more about how macro is impacting crypto and how to stay on top of the crazy changing world that macroeconomics is, make sure you subscribe to the Melro Macro show and also check out our newsletter which comes out every Tuesday and Thursday, five minutes and very simple way to understand what you should be paying attention to attention to in macro.

Thanks for tuning in y'all. Have yourselves a wicked awesome day. We'll see you back again tomorrow. If y'all are making swaps or trades right now, highly recommend you check out Milkroad Swap. This is a DEX that we built in partnership with Cow Protocol. Why did we build it? Not to make money, just honestly so we could have a place to do our swaps for the lowest fees that we could find. This is the fees on Ethereum, Arbitum, and Bass are only 0.15% fees. Uh this is a huge difference from uh other centralized exchanges that charge half a percent or even up to 1.2% fees on their swaps. Also, you can swap on Salana all at swap.mmillgro.com.

Check it out today. You won't be upset. And you can join me in my favorite place to make swaps on chain. As always, if you liked today's episode, please hit subscribe and make sure you follow us so you don't miss out on the next one. There's also a link in the description to our free 5minute daily newsletter where we simplify crypto for you while making you laugh. And if you're willing to step up your crypto investing game, we're going to also leave a link for Milk Road Pro. You get access to our portfolio where you can see exactly what we are buying. This is your number one resource to help you invest successfully in crypto. One final note, this show is for educational purposes only and nothing we say is financial advice.

Investing in crypto or any asset is risky and you should never invest more than you can afford to lose. Thanks so much for listening in my friends.