CEOInterviews.AI#222 Brian Armstrong - Co-Founder & CEO of Coinbase

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Narrator0:00

Chime offers fee-free banking with no overdraft or monthly fees, access to thousands of fee-free ATMs, up to $1,150 in annual rewards, 5% cash back on purchases, a 3.75% APY on savings, premium travel perks, and early pay access. Rated five stars by USA Today. Join millions banking fee-free at chime.com/srs.

H

Host1:50

Brian Armstrong, welcome to the show.

B

Brian Armstrong1:52

Thanks for having me.

H

Host1:53

Oh, my pleasure. I've been looking forward to talking to you. You have a lot going on, even outside of crypto. But first, an introduction: Brian Armstrong, co-founder and CEO of Coinbase, the world's leading cryptocurrency exchange. A Rice University alumnus with degrees in computer science and economics, his engineering background at Airbnb and early startup experience laid the foundation for revolutionizing finance. He transformed a passion for Bitcoin into a publicly traded company in the S&P 500, driving economic freedom through blockchain. He's also founder of New Limit and Research Hub. I also wanted to share some stats: only 9% of Americans are satisfied with the current financial system, 38% of young people say crypto can increase economic opportunities, and crypto prices are up 90% year-to-date. There you go. Interesting statistics. So, before we get going, everybody gets a gift.

B

Brian Armstrong3:42

Mhm.

H

Host3:43

So, I got you a couple gifts. Here's the first one: Vigilance gummy bears. Legal in all 50 states. Just candy, red dye and sugar. And I heard you're a firearms enthusiast, so I got you a Sig Sauer P226 Legion. That's the upgraded model of what all SEALs were issued. All metal, great trigger, gas pedal, helps keep the nose down. I think you'll really like it.

B

Brian Armstrong3:52

All right. Thank you. It's California, so we'll need to handle the transfer.

H

Host4:09

You're welcome. And I also have a gift from you? You said you brought something?

B

Brian Armstrong7:23

I brought you a gift too. This is a Satoshi Nakamoto commemorative card, one of 21. It's a Bitcoin credit card that gives 4% back in Bitcoin. On the front is a copy of the Bitcoin Genesis block, which includes an encoded headline from the 2008 financial crisis: 'Chancellor on the brink of bailouts.' It's kind of a statement that Bitcoin is an answer to bank bailouts. So you can use it to get cash back in Bitcoin.

H

Host8:46

Oh man, thank you. This is awesome. I'll get you to sign it and frame it. And we'll get one hooked up to your Coinbase account for everyday spending.

I do want to talk about who Satoshi is. But first, one last thing before the interview. I have a Patreon account with a community of 90,000 people. One of them, Achilles Actual, asks: 'What measures is Coinbase taking to prevent cryptocurrency theft? And how is the company addressing concerns that quantum computing could compromise blockchain security?'

B

Brian Armstrong9:56

Great questions. We use multiple strategies to prevent theft. For customer funds stored on Coinbase, we use cold storage – generating keys in secure facilities across ally countries, requiring consensus from multiple keys to move funds. We also have a self-custodial wallet for those who don't want to trust us. Regarding quantum computing, post-quantum cryptography is an area of research. Quantum computers could break current encryption, but that would affect banking, military, etc., not just crypto. Upgrade proposals are being discussed. I think we need a solution in place within 3-5 years to be safe, as quantum may arrive in 5-10 years. Coinbase will help ensure funds are quantum-resistant.

H

Host13:07

So you think quantum computing will come into play in about 5 years?

B

Brian Armstrong13:11

Well, I'd want a solution in place before then. It might take 10 years, but I'd rather be ahead. If China gets one, we might see money moved unexpectedly. It's something to get ahead of.

H

Host13:34

Mhm. Yeah, a lot of talk about quantum computing lately. But I'm fascinated with innovators like you. Let's start at the beginning: where did you grow up?

B

Brian Armstrong14:03

I grew up in San Jose, California. Both my parents were engineers – my mom a programmer at IBM, my dad a civil engineer at Lawrence Livermore. I was a shy, introverted kid who loved computers. I didn't know what I wanted to do, but I was a total geek.

H

Host15:08

What age did you start getting interested?

B

Brian Armstrong15:10

Pretty young. In middle school I was trying to learn programming. In high school, I took classes at the local community college. I would stay up until 2 or 3 AM learning how computers worked and then be sleep-deprived at school. It was a signal I was more interested in that than what they taught.

H

Host15:56

What else were you into? Sports? Outdoors?

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Brian Armstrong16:01

Well, I lived next to a park, so I spent time outdoors with my dog. But I wasn't athletic. I tried tennis, liked running, but never team sports. I was introverted.

H

Host16:39

Where'd you go to school?

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Brian Armstrong16:41

I went to Bellarmine, a private Jesuit all-boys school in California. It had a mission of 'men for others' which influenced me. They required volunteer service. Later, building companies became my way of creating value. After that, I applied to schools. I wanted to leave California for independence. I didn't get into MIT or Harvard, but I got into Rice University and visited and really liked it. I studied computer science and economics. I remember the first econ class: economics is the study of scarcity – if you want more of something, you have to have less of something else. The combination of computer science and economics was perfect for crypto.

H

Host19:33

Interesting. So I know you went to Argentina. Was that to study?

B

Brian Armstrong19:38

After college, I was seeking adventure. I had tried starting a tutoring company that wasn't going well. I wanted to go abroad and put myself out of my comfort zone. I went to Buenos Aires as a first stop, planning to spend a month in each city, but I settled there for about a year. It was lonely at first, but I learned Spanish and met people. I saw a society that had gone through hyperinflation. People would get their paycheck and immediately spend it because it might be worth less tomorrow. Coins became scarce. It destroyed optimism. That experience made Bitcoin click for me later – the need for sound money.

H

Host23:04

What was in the white paper that got you fired up?

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Brian Armstrong23:11

I read the Bitcoin white paper in December 2010 on Hacker News. It described a decentralized currency with no country or company controlling it, provably scarce like gold. Peer-to-peer transactions with no intermediary. It immediately captivated me. I had been reading Ayn Rand and Milton Friedman, and the idea appealed to me. I was working at Airbnb and saw how broken moving money globally was. So I couldn't stop thinking about it for six months, reading everything, going to early Bitcoin meetups in San Francisco. Those meetups were a motley crew: anarchists, PhDs, homeless people. After six months, I started working on a prototype nights and weekends that became Coinbase.

H

Host25:46

Interesting. Who is Satoshi Nakamoto?

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Brian Armstrong25:53

Nobody knows for sure. I think it's likely Hal Finney, a computer scientist who passed away, possibly with collaborators like Nick Szabo. They might have used a pseudonym to avoid being hauled before Congress or killed. They mined a lot of early Bitcoin worth a fortune, so they knew their family would need security. But regardless of who Satoshi is, the idea stands on its own – like a scientific theory. The breakthrough is the first purely digital good that is provably scarce. For example, you can copy a photo infinitely, but Bitcoin's algorithm guarantees scarcity. No one has broken it in 13 years, even nation-state actors. The mathematics is solid.

H

Host28:51

Can you talk about printing money out of nothing? Sounds familiar. I want you to talk about the Federal Reserve when we came off the gold standard and what's happened.

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Brian Armstrong29:13

This is a fascinating topic. Historically, reserve currencies start backed by a hard commodity like gold. During crises, countries temporarily detach from that commodity, then overprint and lose reserve status. In the US, dollars were backed by gold until the 1930s when you couldn't exchange anymore, then fully detached in 1971 under Nixon as a temporary measure that never reversed. That allowed budget deficits and led to inflation. If the dollar continues to lose discipline, people may flee to Bitcoin, gold, real estate – provably scarce assets. That's why we're seeing all-time high Bitcoin prices.

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Host32:07

Have we lost all discipline? Is America in decline?

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Brian Armstrong32:11

That's a big question. Trust in institutions is at all-time lows. I think the future is not guaranteed. There are moments where a great leader can change course. Around crypto, President Trump has done good stuff after the last administration waged war on it. I hope America is not in decline – it would be a damn shame. If America falls, who takes the mantle? China is not aligned with our values. We should try to save it, but also have alternatives like Bitcoin, Mars, or special economic zones.

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Host33:38

I don't think America's in decline. We're at a pivotal moment where if we don't turn the ship around, we'll enter decline quickly. But we've been through crazy times before and landed on the moon. No matter how screwed up America is, everywhere else is kind of worse.

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Brian Armstrong34:09

Yeah. I mean, we have the best innovators in the world. Innovators are fired up about the current administration gutting bureaucracy and letting them innovate. I'm all for it. We need to deregulate to build nuclear fusion, supersonic jets, accelerate biotech. Overregulation freezes progress. The government should just run the military, police, courts – everything else the private market can solve better. Competition breeds excellence.

So the incentives aren't aligned for the government to do good things. They should be small, focused on what they have to do, the monopoly on violence, and then let the free market cook. And I think that would be a stronger America.

H

Host37:01

Me too. Me too. So what's the war on crypto? I'm not.

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Brian Armstrong37:07

Yeah,

H

Host37:08

I can't say I'm not a crypto guy because I buy it, even though I don't understand it nearly to your level. But why would there be a war on crypto?

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Brian Armstrong37:21

Well, crypto is a threat to some people in power. In this last administration, Elizabeth Warren and Gary Gensler were the biggest architects of this war on crypto. Elizabeth Warren is a socialist who thinks the government should run all financial services. She applies pressure to big banks to get stuff done she can't pass through Congress, like pressuring JPMorgan not to lend to oil and gas or gun companies. This soft power, called Operation Choke Point 2.0, debanks people for political reasons. Crypto exists outside that power structure, allowing financial transactions without the risk of being shut off by your bank. She hates crypto, but it's hypocrisy because she blocks legislation that would protect consumers. She appointed Gary Gensler as SEC chair, and he flipped on crypto, going from teaching at MIT about its potential to attacking the industry, just to become Treasury Secretary. He created lawfare against crypto companies. When we went public in 2021, the SEC approved everything, but after pressure from Warren, they started sending nasty letters and eventually sued us without pointing to any specific rule violation. We met with them 30 times, and they wouldn't give us guidance. I decided to fight because giving in would kill the entire crypto industry in America. The litigation depressed our stock price, but we fought for two and a half years, spending about $50 million on legal fees. When the Trump administration came in, the SEC chair threw out the case without any penalties. We didn't change anything. It was pure lawfare, and many startups died because they couldn't afford legal costs. But we learned to become politically engaged. We created Standwithcrypto.org, a grassroots campaign that organized 2 million Americans to elect pro-crypto candidates. We now have the most pro-crypto Congress ever.

H

Host40:09

Are you serious?

B

Brian Armstrong40:10

Yeah. So he totally flopped.

H

Host40:12

He totally flip-flopped.

B

Brian Armstrong40:14

Yeah.

H

Host40:14

Just for a job.

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Brian Armstrong40:16

I think these guys are mentally willing to change their values for personal advancement, to get the job they want. He went in and created lawfare against crypto companies. After we went public, the SEC approved everything, but then they started sending nasty letters and sued us. We met with them 30 times, and they wouldn't give us any guidance. I decided to fight because giving in would hurt our business and kill the entire crypto industry in America. A lot of crypto activity was going offshore anyway, and American consumers were using platforms like FTX that blew up and stole money. I thought, 'Are we just going to seed this entire industry to foreign companies?' So we fought, and it took about two and a half years. The SEC pressured banks not to work with us. I was even worried about personal criminal charges, but luckily that didn't happen. When the Trump administration came in, the new SEC chair looked at the case and threw it out. We didn't pay a penny or change anything. It was pure lawfare, and many startups died because they couldn't afford legal fees. But the positive is that we learned to become politically engaged. We created Standwithcrypto.org, which organized 2 million Americans in the last election. They elected pro-crypto candidates, and we now have the most pro-crypto Congress ever. We also helped unseat Sherrod Brown, the anti-crypto chair of the Senate Banking Committee. The crypto community backed Bernie Moreno, and he went from being down 11 points to winning. That sent shockwaves through DC.

H

Host43:28

What companies?

B

Brian Armstrong43:29

We were trying to close deals with big banks to get money moving onto our platform, and the SEC would go meet with them and tell them we were under investigation and they shouldn't work with us. I was worried about personal criminal charges, but it luckily didn't happen. The case got dropped by the new SEC chair. We spent about $50 million on legal fees, but a lot of startups couldn't afford it and shut down.

H

Host45:13

I mean, I commend you here. That takes some serious balls to go after the SEC.

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Brian Armstrong45:21

People told me I was crazy to do it, but I'm glad we did because the crypto industry might not exist in the US today if we had caved. It took about two and a half years, and we spent $50 to $100 million in direct legal fees, and our stock price was in the gutter. It was a huge setback for America. I joked that Gary Gensler should go run the economic development board for the UAE or Bahamas because he grew their economies enormously by pushing crypto businesses offshore.

H

Host45:38

Wow. And that took how many years?

B

Brian Armstrong45:41

About two and a half years. It was $50 to $100 million in legal fees, and our stock price was down for a long time. It was a huge setback for America.

H

Host46:23

Well, it turned into a huge win.

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Brian Armstrong46:26

The positive is that we learned how to become politically engaged as an industry. I was naive, thinking we could just follow the law and not deal with politics. But politics came after us. We realized we had to organize our customers, and we created Standwithcrypto.org. In the last election, about 2 million voters showed up, and we now have the most pro-crypto Congress ever. We also created Fairshake, a PAC that raised money to elect pro-crypto candidates. It's bipartisan.

H

Host48:06

I mean, you set up a fund. Is it $140 million set aside for pro-crypto candidates?

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Brian Armstrong48:17

Yeah.

H

Host48:18

Doesn't matter what side they lean.

B

Brian Armstrong48:20

Yeah, it's bipartisan. That's a PAC called Fairshake that we were involved in along with others. It has a bunch of money and is helping elect pro-crypto candidates.

H

Host48:33

How's that? Have you gotten anybody unseated in the Senate or Congress for going against crypto?

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Brian Armstrong48:39

The most notable was Sherrod Brown, the sitting chair of the Senate Banking Committee who was super anti-crypto. I flew to DC several times to meet with him, but he refused. We flew in entrepreneurs from Ohio, and he still wouldn't meet. He blocked every attempt at legislation. He was up about 11% in the polls, but we backed Bernie Moreno, and he went from being down 11 points to winning. That was a huge upset that sent shockwaves through DC. We played in about a dozen other races with an 80 to 90% win rate. People realized that being anti-crypto is bad politics because there's no constituency for it, but pro-crypto can get a lot of votes.

H

Host50:16

Yeah, and so people...

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Brian Armstrong50:18

Congratulations. But people realized in DC that there's no constituency that wants to vote for anti-crypto. If you're pro-crypto, you can get a lot of votes. The American people want this, so it's bad politics to be anti-crypto.

H

Host50:32

Have you had anybody that told you they would be pro-crypto and then flipped?

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Brian Armstrong50:38

We've had some people that were wishy-washy, like a foxhole conversion where right before an election they'd suddenly say pro-crypto stuff. Maxine Waters was interesting—she was nice to my face but then went on the House floor and attacked Coinbase. She flipped. I don't think she'll be pro-crypto.

H

Host51:37

How do you educate congressmen, senators, appointees? We're dealing with a lot of dinosaurs. How do you get it to them when even I don't fully understand it?

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Brian Armstrong52:23

It's a generational issue. Many members of Congress over 70 don't get it, but their staff have the Coinbase app. I understand they're mile-wide, inch-deep, so they rely on staff and principles like free market. I started going to DC quarterly to build relationships. Initially, we tried to be an educational resource, but that didn't work. It wasn't until we organized millions of voters and had real political power that they started to take us seriously. We tell them crypto updates the financial system—it's faster, cheaper, and gives better rewards. The average savings account pays 0.14%, but treasuries pay 4.5%. Americans want better services. We also use national security arguments: a digital dollar ensures reserve currency status, and we want these industries built in America, not offshore like 5G and semiconductors. Congress now has a strong bipartisan majority that wants to build crypto here. They just passed a crypto bill, and another is expected in September or October.

H

Host54:44

What do you tell them? Especially with older generations in government, I can't see them wanting to move to crypto.

B

Brian Armstrong55:01

Well, in many ways, you're right. Crypto is about individual freedom and sovereignty. If you want more power in government, it's unclear why. But the people want it. We talk about updating the financial system—fees are high, overdraft fees, hard to send money, unequal access. Crypto can make payments faster, cheaper, more global, and give better rewards. For example, savings accounts pay almost nothing, but they should get 4.5%. There's also the national security argument: ensuring the digital dollar and keeping industries onshore. It's compelling, and Congress now supports it.

H

Host58:28

I wanted to ask you about money. We were talking about the Federal Reserve and currencies tied to commodities. What is money to you?

B

Brian Armstrong58:41

To me, money is a medium of exchange that came from the barter system. It needs properties like scarcity, durability, portability, and divisibility. Gold has some, but Bitcoin is probably the best form of money ever created—it's scarce like gold, but portable and divisible. It's digital gold. Crypto provides a better alternative.

H

Host1:01:31

I listen to people like Dave Ramsey, who says crypto is backed by nothing. He's a big finance guy, but he doesn't like crypto.

B

Brian Armstrong1:02:18

He's right that it's not backed by anything, but neither is the dollar. Picasso paintings aren't backed by anything either. People value Bitcoin because it's scarce and trust is built through Satoshi's fair launch, the algorithm's security, and the fact that no government has broken it. You could argue it's backed by the energy used to mine it, but ultimately it's about trust. If people trust it and it's scarce, that's all you need.

H

Host1:04:20

What are some of the other coins? Is Bitcoin the primary? Why do people hold others like Ethereum, Solana, XRP?

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Brian Armstrong1:05:11

Crypto isn't just one thing. Bitcoin is digital gold. Others like Ethereum and Solana are blockchains that serve as payment and utility layers. There are millions of coins built on top for specific purposes. For example, a company can raise money, or a social media post or podcast episode can be a coin. That's where crypto is going—NFTs were an early version. Now, with our app Base, every piece of content can be a coin with its own market cap, allowing creators to get paid directly by fans.

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Host1:06:20

What do you mean by that?

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Brian Armstrong1:06:21

If you put out a podcast episode, today you have sponsors. But imagine people owning a copy of that episode, like buying a token. That's what we're building with Base. It's a self-custodial wallet that allows anyone with a smartphone to participate, especially in countries with high inflation like Venezuela, Turkey, and Nigeria.

H

Host1:07:20

Is this like NFTs?

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Brian Armstrong1:07:22

It's similar. NFTs were collectibles, like baseball cards. Now, every piece of content online can be its own coin.

H

Host1:08:16

Wow.

B

Brian Armstrong1:08:17

Yeah.

H

Host1:08:19

That's awesome.

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Brian Armstrong1:08:20

Yeah, through Base. It's a self-custodial wallet, so you hold your own crypto and don't have to trust any third party, even Coinbase. The main Coinbase app is regulated in each country, but with self-custody, we can launch in 190 countries from day one.

H

Host1:09:34

How many countries are fighting crypto? Don't want it?

B

Brian Armstrong1:09:42

The biggest is China. It's not technically illegal for Chinese people to own crypto, but the government blocks it with the Great Firewall. They debanked crypto companies and issued their own digital yuan, which is a tool for control. India's Reserve Bank has concerns about capital controls. Some countries clamp down because they want to prevent money from leaving, but the people in those countries desperately want crypto. We try to work with governments while providing tools for freedom.

H

Host1:11:54

When it comes to using crypto as a currency, the volatility is a big issue. When do you think it will level off?

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Brian Armstrong1:12:24

Bitcoin has gotten less volatile over the last 10 years as more people own it. As we go from 500 million users to a couple billion, it will get even less volatile, but it'll still go up over time as more people come in. You won't see 100% wild swings, but it's still a new asset class.

Lot of people are using Bitcoin more like a store of value, and then as a currency like a medium of exchange, they're using things like USDcoin or things which are less volatile. So again, crypto is kind of reinventing all these pieces of the financial system and making them more fast, cheap, global, efficient.

H

Host1:13:27

What do you think it will go to? Like the long-term implications of it?

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Brian Armstrong1:13:32

Yeah, from a market cap point of view, I think it's got a long way to go, 10 or 100x. But the ultimate outcome is that governments stop controlling currency. We exist in a world with 190 countries and about 150 currencies. Imagine if every country had its own internet, that would be terrible. We should all be running on the same monetary system globally, a fair system that no one country or company controls. The power to issue currency is being unbundled from the state and returned to individuals. It's going to lead to a more fair and free society, money that can't be inflated away, instant transactions for tiny amounts, cross-border. The current financial system is an unfair tax on every transaction.

H

Host1:15:26

Um, I'll give you an example. You remember text messaging used to be like 30 cents.

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Brian Armstrong1:15:33

Yeah.

H

Host1:15:33

Yeah. And you know I think that at that time there was maybe a billion messages a day sent by text message. But applications like WhatsApp and Signal came out and now it's free to send a message anywhere in the world instantly.

B

Brian Armstrong1:15:53

Mhm.

H

Host1:15:54

There's now like 200 billion messages sent per day because it's free and instant and global. That's what's going to start to happen with the economy and money. There's so much friction today to move money. If we can bring the cost down to under a cent and under one second anywhere in the world, transactions will flourish. So that's what we're trying to do with crypto, update the financial system, make it more efficient, more global, more fair, more free.

Who — couple of questions just off what you were riveting on there. You know, who set up the USD stable coin?

B

Brian Armstrong1:16:41

So, originally there was a company called Circle in partnership with Coinbase and we co-created it. Now they're the issuer and we're a distributor. But basically Circle is the issuer of USDC.

H

Host1:16:55

Okay. And then, you know, when we're talking about moving to a digital currency globally and having a global currency, you know, how do you think that would affect the US? I mean, Elon Musk talks about how the US has weaponized the dollar, which is a bad thing.

I mean, slippery slope there, right? You get the reputation, then people are going to want to move. We've seen BRICS — Brazil, Russia, India, China, South Africa, several other countries have joined because the US has weaponized the dollar. So if we move to a global currency, how does that affect the US's ability to have control around the globe?

B

Brian Armstrong1:17:45

Yeah. So, this is a great question, it's complicated. If you think about a digital dollar like USDC, that's unequivocally good for the dollar and the US. It helps make the dollar the reserve currency and creates demand for US Treasuries. If we talk about Bitcoin, it's more complicated. If the dollar maintains discipline, it will continue as reserve currency. If the dollar loses discipline, people will flee to Bitcoin. In that case, the US could lose reserve currency status. If they're going to lose it, I'd rather they go to Bitcoin than the Chinese yuan.

Mhm. Right. So that's why I say Bitcoin is kind of like a check and balance on the dollar and deficit spending. I hope the US maintains discipline and remains strong. In that case, crypto will be a very good thing. But if we're going to lose it, I'd rather we have Bitcoin than have to live under a Chinese system.

H

Host1:19:11

And then, you know, we're talking about you're fighting congressmen, senators, governments. What about banks? Like Chase, Bank of America, Regions? I imagine they do not want this to happen.

B

Brian Armstrong1:19:32

Yeah, these are big organizations. It's funny, some in the bank are positive, some negative. In general, we've had good relationships. We need to work with them because we've built a bridge from the bank system to crypto. When people come to Coinbase, they connect their bank and move money. So we work with most big banks, but some are skeptical and afraid of disruption.

H

Host1:20:06

It could eliminate them, correct?

B

Brian Armstrong1:20:08

Yeah, if I'm sitting here in 10 or 20 years, I'd be hard. I still think there'll be dollars and banks, but a whole generation is growing up using Coinbase like a bank replacement. There's a community bank lobby story: when we were trying to get stablecoin legislation passed, the community bank lobby lobbied against it because they didn't want stablecoins paying 4.5% interest while they pay near zero. They argued it would dry up loans, but really they were protecting their margins. They got a line in the bill prohibiting stablecoin issuers from paying interest. That passed. But we're not a stablecoin issuer, so we can continue to pay rewards. We pay 4.5% to customers holding USDC. We believe in updating the financial system. If community banks don't like it, they should compete. That's what the free market does. So we have to deal with these special interests. It's part of why I'm in favor of small government.

H

Host1:23:03

How long do you think it'll be before we start seeing people use crypto as currency at Walmart, the gas station, the grocery store, everywhere?

B

Brian Armstrong1:23:20

Yeah, the earliest adopters will be online e-commerce. We just announced a partnership with Shopify to accept USDC and give 1% cash back because merchants save on credit card fees. Also the Bitcoin credit card and Visa debit card allow people to spend crypto. Eventually we hope merchants do direct integration to save fees. The credit card companies have a strong network effect, but a decentralized protocol like crypto may be the only way to compete.

H

Host1:24:58

Do you transact in crypto?

B

Brian Armstrong1:25:01

Yeah, I use my Coinbase card for most purchases. I'm trying to live on the frontier. Many customers start with investment and then add loans, payments, earning yield.

H

Host1:25:43

Is that through base or through Coinbase?

B

Brian Armstrong1:25:45

That's through Coinbase.

H

Host1:25:48

So I can go on Coinbase and apply for a loan?

B

Brian Armstrong1:25:50

Yeah.

H

Host1:25:51

I didn't even know that.

B

Brian Armstrong1:25:52

Yeah, that's what we ultimately want to do, update the financial system, all parts including borrowing and lending.

H

Host1:26:05

What are you checking when somebody borrows? Are you checking credit or just what's in their Coinbase wallet?

B

Brian Armstrong1:26:12

Yeah, in that case it's just the collateral of Bitcoin in their wallet. We don't need a credit check. But we'd like to do non-collateralized lending based on credit. We're trying to invent a decentralized credit score based on the blockchain, so you can see a record of transactions and build a reputation score like a FICO on chain.

H

Host1:26:57

Wow. So a whole new credit score system.

B

Brian Armstrong1:27:02

Yeah, in the US it can be difficult to get a loan. In many emerging markets, there's no credit system. When I was in Argentina, nobody could get a mortgage. Only rich people pay cash. With crypto, we can provide a lending market globally. A 20-year-old in India should be able to get a loan to start a business. Most people don't have access to credit markets.

H

Host1:28:04

Interesting.

Let's take a quick break. When we come back, I want to talk about the journey to starting Coinbase.

B

Brian Armstrong1:28:12

Great.

H

Host1:28:12

Perfect.

All right, Brian, we're back from the break. Getting ready to get into the journey to innovating Coinbase. But just a couple of questions that came to mind on the break. We talked about 21 million bitcoins will only ever exist. What do you think will happen when we hit 21 million?

B

Brian Armstrong1:28:48

Mhm.

Well, yeah. So right now, fewer Bitcoin are being produced over time. It hits a maximum around 21 million, but it takes a hundred years. We're most of the way through, about 20 million already mined, only about a million left. New Bitcoin are created when miners verify a new block. Once that runs out, miners will be compensated by transaction fees. So supply stops growing. To get Bitcoin, you have to buy from someone willing to sell. That's already how most people do it. So the price is determined by who is willing to sell.

H

Host1:30:42

So, is that already set up so that when we hit 21 million, miners will be incentivized with transaction fees?

B

Brian Armstrong1:30:58

Yeah, that's already happening today. It'll gradually shift to transaction fees over time.

H

Host1:31:03

And then, does the system ever need to be updated? Like Bitcoin, nobody knows who created it. Will it need updating? And if so, who does that?

B

Brian Armstrong1:31:15

Yeah, I think Bitcoin will need to be updated for quantum resistance. Quantum computers create a risk. Bitcoin has a mechanism for upgrades. There are core developers, miners, exchanges like Coinbase. The community discusses proposals. For an upgrade, more than 50% needs to agree. It's a consensus mechanism. The downside is it can be slower, but no small group can harm it unilaterally.

H

Host1:32:59

Okay, that was actually another question. Michael Saylor is buying tons of Bitcoin. Is it good for the Bitcoin market for someone to have that big a stake?

B

Brian Armstrong1:33:23

I think it's good. He's a bull. He can't own 50%, the market is too big. Various groups will acquire positions, driving up demand.

H

Host1:33:44

Okay, another question: will we ever see things like IRA, Roth IRA, 529 college savings for crypto? Where you can set aside money for kids without opening different wallets?

B

Brian Armstrong1:34:17

Yeah, in some ways it's already happening. I gave family members Bitcoin when they were born. For IRAs and such, we need to chip away at rules. People should be able to hold crypto in those accounts. We're working on making it easier and opening up retirement accounts. Customers are asking for it.

H

Host1:35:22

Okay, I touched on this earlier. There are a handful of mainstays, but then all these trash coins and scams like FTX and Sam Bankman-Fried with celebrities. How do people new to the industry navigate that?

B

Brian Armstrong1:36:00

Yeah, crypto has its share of scammers. But every technology has scams. 99% of people are good. For the new person, if it sounds too good to be true, it probably is. Start small, 1% of net worth in Bitcoin. Use good judgment. There's no return without risk.

H

Host1:38:33

Mhm. Another question. We talked about prepping at breakfast. The big argument against crypto is what happens if the grid goes down? You have no access to Bitcoin. But you probably don't have access to regular money either. What are your thoughts?

B

Brian Armstrong1:39:04

Yeah, if the grid goes down, society is disrupted. Your Bitcoin is safe. There are hypothetical ways to transact offline via mesh networks. But in a collapse, things like ammunition and gold are fallbacks. So own gold too. In a functioning civilization, Bitcoin is superior to gold.

H

Host1:40:16

Thank you. All right, let's talk about the road to Coinbase.

B

Brian Armstrong1:40:20

Yeah.

H

Host1:40:22

So, I know you got inspired by the white papers.

B

Brian Armstrong1:40:24

Yes, I first read the Bitcoin white paper in December 2010 while working at Airbnb. I was captivated. My friends thought it was a scam, but I couldn't shake the idea. I started building a prototype on nights and weekends. I applied to Y Combinator and got in. I quit my job at Airbnb, which was tough because I had stock options. But I wanted to do something important. I joined YC, worked hard. After the program, I couldn't raise much, but I met my co-founder Fred Ehrsam. We decided to get US licenses and build a trusted, compliant company. That was the beginning.

H

Host1:48:20

You put it out there in the world and like people come and look at it and nobody gives a damn, right?

B

Brian Armstrong1:48:24

Yeah, I can tell you that story.

H

Host1:48:28

Yeah, I want to hear it.

B

Brian Armstrong1:48:29

Yeah, this is the hard thing about starting a company. You make version one and put it out there, and usually no one cares. That's the default.

There's so much noise. How do you break through? I put out a prototype of a simple Bitcoin wallet with my co-founder Fred Ehrsam. We posted it on Reddit and forums. A hundred people signed up but none stuck around. Y Combinator taught us to find product market fit by talking to customers and iterating. Many entrepreneurs get caught up in conferences and blog posts instead of just talking to customers. That's how you find product market fit.

H

Host1:50:04

How would you talk to them? How many customers were there at the beginning?

B

Brian Armstrong1:50:07

Yeah. When we put out the first version, maybe a couple hundred people signed up but didn't stick around. I emailed random people who signed up and asked for feedback. One guy said he didn't have any Bitcoin. I asked if a buy button would help. He said probably. At that time, you couldn't buy Bitcoin on Coinbase. So we added a buy button. We had to hook up payment methods, legal stuff, and an exchange. We launched it and people started using it. It became the simplest way to buy Bitcoin. Word of mouth spread. That wasn't the first thing we tried; we tried a dozen other things. Eventually we hit on one that worked. The product became good enough that more people came back each week. That was the moment we knew we had product market fit. Then the problem became scaling: hiring, customer support, raising money. We used all our working capital to source Bitcoin. So we raised the next round. We had the kernel of something growing.

H

Host1:52:49

Wow. How fast did you see it grow?

B

Brian Armstrong1:52:54

When product market fit works, it grows shockingly fast. It went from 100 people using it per day to 1,000, then 10,000. One day 25,000 signed up. I compared it to sports stadiums. With that many signups, we got a lot of customer support tickets. We had no support team, so between 9 PM and midnight, my co-founder, first employee, and I answered tickets. We developed a backlog of 10,000-20,000 tickets. Hackers also started trying to break in. We had to build a cold storage system to store funds offline. One day we noticed refunds going out that we didn't authorize. A hacker had broken into our admin interface and was sending refunds to himself. We shut down the site, patched the vulnerability, and came back online. He had sent about $50,000 in refunds. At that time we had only raised $300-400k, so we were still alive. If he had started at midnight while we were asleep, we would have been out of business by morning. It was pure luck that Coinbase still exists.

H

Host1:56:11

Wow.

B

Brian Armstrong1:56:11

You know, because we caught it within like 10 minutes.

H

Host1:56:14

Yeah.

B

Brian Armstrong1:56:14

And it's just pure luck that Coinbase would not exist today. That was a coin flip. If that hacker had waited till midnight, we would have been insolvent by morning.

H

Host1:56:26

Wow.

B

Brian Armstrong1:56:27

Yeah.

H

Host1:56:28

Wow.

Damn. I mean, what was the moment that really got you when you were like, 'Holy [ __ ] this is going to work.'

B

Brian Armstrong1:56:42

Well, there were a lot of moments along the way where I knew we had a chance to make it big, but it wasn't guaranteed. There were many ways we could screw it up. We were seeing demand and generating revenue, but our systems weren't hardened enough. The cybersecurity risk was very real. That's how a lot of crypto companies died. The other big risk was compliance and government. We thought the government might shut it down. Also competitors. We saw solid companies pop up overseas and in the US. We also thought there could be a flaw found in the Bitcoin algorithm. We looked at it and couldn't find one, but who knows? Over time we mitigated those risks. It got big enough that enough Americans used it that the government couldn't shut it down. It would be political suicide. In the early days, if someone in government had their act together, they could have killed it. Elizabeth Warren and Gary Gensler tried, but it was too late.

H

Host1:58:31

But it was too late. So,

B

Brian Armstrong1:58:33

Those were the risks along the way where we didn't know if it was going to work.

H

Host1:58:36

I mean, we talked a lot about economic freedom here on the first segment. So, I just want to ask you, what does economic freedom mean to you?

B

Brian Armstrong1:58:49

Yeah, I think economic freedom to me is it's your money. You should be able to do whatever you want with it. There are a lot of middlemen blocking payments, taking fees, slowing things down. Economists call it property rights. Can you actually own stuff or can it be taken away without your permission? In many countries, the money in your bank account can be yanked out by the government. In Cyprus in the 2010s, the government took 50% of money out of everyone's bank account. So you don't actually own it. Same thing in Argentina with inflation. That's another form of theft. Property rights are a foundation for all progress in civilization. If you can't keep what belongs to you, it's hard to make plans. Sound money is the same. Most people in the world don't have high economic freedom. We take it for granted in the US, but it's under threat with inflation and eminent domain. Crypto is the key technology that can give economic freedom to anyone with a smartphone, allowing them to opt out of a corrupt local system.

H

Host1:59:38

I think it was in the 2010s. Yeah. Or maybe the 2000s. Yeah. So there's examples like that in history.

B

Brian Armstrong1:59:46

Same thing in Argentina. There are times where the government has printed so much currency that it devalued. That's another form of theft. High inflation devalues everyone's assets to give the government more money. Property rights are a foundation for all progress. If you can't keep what belongs to you, it's hard to make plans. Most people in the world don't have high economic freedom. We take it for granted in the US, but it's under threat. Crypto can give economic freedom to anyone with a smartphone.

H

Host2:01:29

Why do you think crypto, or excuse me, why do you think Coinbase is the most trusted exchange out there? What have you done that's different than the other ones?

B

Brian Armstrong2:01:37

Yeah, it's a great point. When we do surveys, we come back as the most trusted brand of crypto. I think it's a few things. Companies are a reflection of their founders. I was willing to put my name behind it. I'm based in the US, I'm an American citizen. I try to do the right thing and tell the truth. People may not like me, but they don't think I'm full of [ __ ] or a scammer. We've also followed a compliant and regulated approach. We've gotten every license we needed. We've reached a size and scale where we have a track record. We store crypto for 140 government institutions. We work with the US Marshals Service and other federal agencies. We're a public company, so our financial statements are audited by the big four accounting firms. All those things contribute to trust. But you have to earn it every day. There have been times we got backed up on customer support, or hackers tried to break in and we made customers whole. We try to stand behind our customers and push back on the government when it does something unethical.

H

Host2:04:06

How do you lead your company?

B

Brian Armstrong2:04:10

Well, it's a broad question. Tactically, about once a week I get together with the executive team for a deep dive on anything that needs to be decided. I try to push decision-making down into the organization so I'm not a bottleneck. We have about 5,000 people now. I name who's the decider and push it down. I try to have a high bar for talent, be selective on the way in, and performance manage people out. We invest in our core business but also try to build the next thing on the frontier with small bets. Some don't work, and that's okay. We want people willing to try innovative ideas with small teams, like a startup within the company.

H

Host2:05:51

What are some of the things that your special teams have innovated?

B

Brian Armstrong2:05:56

Well, an example would be USDC, which we co-created with Digital Dollar. Another is Base, a very fast, cheap blockchain that allows payments to happen instantly all over the world. We just released a new app that lets content creators get paid directly. Another is the Coinbase Developer Platform, where anyone can integrate crypto custody, payments, trading into their company. It's like Amazon Web Services for crypto.

H

Host2:06:56

You know, another thing that I like about you is you don't bend to the culture wars.

B

Brian Armstrong2:07:02

Yeah. Let's talk about that.

H

Host2:07:06

Let's talk about it.

B

Brian Armstrong2:07:07

Yeah. Well, I think what you're referring to is a blog post I put out called 'Mission First,' where we said we're going to be apolitical at Coinbase and focus on the mission. It had a big impact. The backstory: around 2020, I noticed employees at town halls were asking about social issues unrelated to our business. It culminated with an employee asking if the company would support Black Lives Matter. I declined to answer. After the town hall, 300 employees walked out. I realized I had failed as a leader. I drafted a post saying we're going to focus on increasing economic freedom, and keep politics outside of work. It was highly contrarian. People inside begged me not to post it, saying it would destroy the company. I talked to employees, including Black employees, and they just wanted to come in, do good work, and have an impact. So I posted it. I was scared. I offered a 3-month severance to anyone not on board. 5% quit, 95% stayed. It was the best thing we ever did. The New York Times wrote hit pieces, but a year later the demographics hadn't changed. Other CEOs started calling me, asking how I did it. It made us a stronger company.

H

Host2:09:24

Are you serious?

B

Brian Armstrong2:09:25

Yeah.

H

Host2:09:27

This was I didn't realize the extent to which this had happened, but a bunch of this activism mindset had infiltrated the company. A lot of it originated in universities teaching Marxism and how to be activists inside organizations. So culturally it was reaching a fever pitch.

How many employees did you have at the time when 300 walked out?

B

Brian Armstrong2:09:52

We had about 2,000. So a good chunk walked out. I remember one guy, a veteran, posted in Slack that he was staying to support our customers. I always appreciated him for that. So I pulled the executive team together. I had never experienced something like this as CEO. I didn't even know what Black Lives Matter was. Later I found out they wanted to defund the police and had issues with misallocation of funds. Every company in America was putting out flags. I initially thought about putting out a statement, but I felt something was wrong. I realized I had failed to create clarity. I was afraid of upsetting people. So I decided to post the 'Mission First' blog. I was scared shitless. My leg was shaking, my voice cracked. I announced it to the company and offered a severance. 5% quit. It was the best thing we ever did. The New York Times wrote hit pieces, but it didn't change our demographics. Other CEOs called me wanting to do the same. It made us a stronger company.

H

Host2:15:07

Nice.

B

Brian Armstrong2:15:07

Ready to get [ __ ] done, go in the same direction. Best thing we ever did for the company.

H

Host2:15:22

Oh, go figure.

B

Brian Armstrong2:15:23

Yeah. By the way, a year later, it didn't change the demographics of the company at all. It was either the same or better. We just go on merit now. All their accusations about racism were completely false. Then other CEOs started calling me, saying 'Holy [ __ ], how did you do that?' I told them they could just do it. Some did. We took some arrows for being early, but it was great.

H

Host2:16:24

That's awesome.

B

Brian Armstrong2:16:25

Yeah.

H

Host2:16:26

I mean, where do these people go? You did it, Elon did it with X, and now we're starting to see it at Google, Facebook. Lots of tech companies followed suit. Where do these people go? It's a black mark. If you see somebody that left Coinbase at that time or left Twitter during that time, it's like, 'Oh, you're one of those.' Where do they go?

B

Brian Armstrong2:17:14

Yeah. I haven't really spent a lot of time tracking that, but you're right. We do look at when people worked at different companies and draw a story. There were some companies that leaned even harder into it. They said, 'We make suitcases or CRM software, but we're actually about some bigger thing.' If people wanted to work at social justice companies, they're welcome to go do that.

H

Host2:17:45

Not to mention, talking about social justice and what you're trying to do is economic freedom. Like, okay, what the [ __ ] are you complaining about?

B

Brian Armstrong2:17:55

Exactly. If somebody's really into Marxism and socialism, it's not a good fit. They should not work at Coinbase. We've been much more clear with people now when they join. That was a good moment for me as a leader to realize your job is not to be liked, it's to be clear about what we're doing. Then people can opt in or not.

H

Host2:18:26

Let's talk about there was one other thing: you took on the SF SEC. We talked about that. And then extortion by hackers. What was that all about?

B

Brian Armstrong2:18:39

Yeah. This was a more recent one. We've always had hackers trying to break into our systems. We spent a lot of time building secure storage. But recently, hackers started contacting our customer support agents and trying to bribe them to turn over customer information. Our support agents don't have access to move money, but they can see personal info like name, address, balance. They were offered $250,000 bribes. Unfortunately, in some overseas facilities, they found one or two bad apples. These agents smuggled in personal phones and took photos of screens. The attackers then called customers pretending to be Coinbase support and tricked them into sending funds. We refunded the affected customers. The information became less useful as we hardened systems. Then the attackers sent a ransom demand: pay $20 million or they'd leak the information. We decided not to pay. Instead, we put out a $20 million bounty for information leading to their arrest and conviction. It was controversial in the security community, but we turned the tables. We got about 5,000 tips, a couple hundred solid leads. We're making progress towards arrests. It's not just one person. We've built good relationships with law enforcement. It will feel good to catch some bad guys.

H

Host2:21:59

Yeah. In the security community, a lot of people later told me they'd always wanted to do that but were afraid.

B

Brian Armstrong2:22:00

A lot of people later told me they'd always wanted to do that but were afraid to do it. It was a great moment. We put out this $20 million bounty. When Osama bin Laden was taken down, the US government put out a $25 million bounty. So this was substantial. There's no honor among thieves. All these hackers started sending in tips. Some were regular people, others were threat actors with beef. We got 5,000 tips. We had a team work down the list. We don't have anything to announce today, but we're making good progress towards arrests.

H

Host2:23:22

That's awesome, man. I can't wait till you get them.

B

Brian Armstrong2:23:25

Yeah.

H

Host2:23:25

That's good thinking. Great thinking. Let's talk about the Genius Act. I know you were instrumental in it, correct?

B

Brian Armstrong2:23:32

Yeah.

H

Host2:23:33

What is that?

B

Brian Armstrong2:23:35

The Genius Act is a piece of legislation that helps stablecoins be allowed to be used in the United States. Stablecoins are digital dollars. They allow payments to happen quickly and cheaply anywhere in the world with the US dollar. Credit cards have 2-3% fees, wire transfers cost $50 and are slow. Stablecoins are fast, cheap, and global. They can be sent anywhere for under one cent in one second or less. USDC is the biggest legitimate one. All dollar stablecoins are backed by US Treasuries, so we can pay about 4.5% to people holding them, which you can't get on a checking account.

Savings account. So anyway, the Genius Act, it took a lot of work by members of Congress and Senate, and a bunch of companies including us have been advocating for this legislation. It just creates clear rules around how these things can be issued and used. Now that there's clear legislation that just got passed last Friday, I was at the White House for the signing ceremony with President Trump. I think you're going to see more and more businesses start to accept stablecoins. It just saves them money. As an average consumer, you might think a 2 to 3% fee is not that much, but the merchant pays it. If you're a grocery store with a 5% margin, paying 2 to 3% to credit card companies is a huge chunk of your profit. So I think it's another way that crypto is updating the financial system. The Stablecoin Act is a huge first step. The other big piece of legislation we need is the Clarity Act, which is about other crypto assets like Bitcoin and Ethereum, helping determine which are commodities or securities. The lack of clarity was weaponized by Gary Gensler and Elizabeth Warren in the prior administration. If we have laws that make it clear how these are regulated, they can't attack and try to kill it again in the future.

H

Host2:25:58

Makes sense. Makes sense. I mean, I read that the Federal Reserve put Bitcoin, Cardano, Ethereum, XRP. The Federal Reserve is going to hold some. What does that mean for us?

B

Brian Armstrong2:26:14

Yeah. Well, President Trump passed an executive order creating a strategic Bitcoin reserve and a crypto asset stockpile to hold some of these others. A lot of people don't know, but the US actually holds strategic reserves of various assets. Gold is the most famous, but there's also an oil strategic reserve, palladium, and other rare minerals. So it's a historic step where the US government is saying Bitcoin is another strategic asset. This would have been unthinkable five years ago. Now the US government is holding a stockpile of Bitcoin assets. It was a huge moment. Now that the US is doing this, I think the rest of the G20 countries and central banks are starting to look at it. It instantly legitimized it. President Trump, to his credit, wants to be the first crypto president. He's all in, saying America has to lead in updating the financial system. The rest of the G20 are looking at this as a model to follow.

H

Host2:27:33

Man, nice work again. Yeah, yeah. So let's move into talking more about Base. Jeremy, my producer, says it's the Amazon of crypto. What all is going to be wrapped up in this?

B

Brian Armstrong2:27:55

Yeah. So Base is an app that we just launched the beta of last week. People started with cryptocurrency as an investment, then we added financial services like payments and lending with USDC stablecoins. Base is the third act where we want applications on the internet to use crypto natively and allow permissionless value transfer. For example, if you're a content creator with a podcast or music or social media, you can have a direct relationship with your audience and monetize directly. Every post on Base is a coin that people can buy and trade. It allows content creators to directly monetize their audience. Traditionally, the internet had an ad business model because payments were high friction. Now with a native layer for money and value transfer, microtransactions become seamless. We think it will flip the ad model on its head, with value going to content creators instead of platforms.

H

Host2:30:20

Wow. What kind of creators are on there right now?

B

Brian Armstrong2:30:22

It's all early. Some people are putting out video content like TikTok, some are putting out music. You'll also see communities formed around specific interests, like tech entrepreneurs or fitness. It's early days, like the early internet. There are about 300,000 people on the waitlist right now. We're slowly giving out invites. And by the way, Base is a self-custodial wallet, so everybody owns their own coins and content. They can take it anywhere because it's based on an open protocol.

H

Host2:31:37

How do I get on the waitlist?

B

Brian Armstrong2:31:39

I'll send you an invite. Your audience might exceed our capacity, but we can give you an invite code for your Patreon members.

H

Host2:31:51

Oh, yes. I would love that.

B

Brian Armstrong2:31:53

Okay, yeah, we could do that.

H

Host2:31:56

Hell yes. Thank you. How many Patreon members do you have?

B

Brian Armstrong2:32:00

We have about 90,000.

H

Host2:32:02

Okay, that's even bigger than I thought. We can break it up.

B

Brian Armstrong2:32:04

We'll put it at the top tier.

H

Host2:32:07

Okay, man. Thank you.

B

Brian Armstrong2:32:10

And I know you're venturing into stuff that has nothing to do with crypto. What is that?

Yeah, well, zooming out, the thing I'm most interested in is accelerating technological progress and building cool things that are useful. When Coinbase went public, I got some liquidity and thought about what to do. I started looking at big challenges on the frontier of science and technology. I was inspired by Elon Musk, who used his PayPal money for rockets and electric cars. I feel like if you're a software entrepreneur with success, you owe it to society to put capital into hard things in the world of atoms, not just bits. I reached out to smart friends and hosted dinners asking what needs more investment. People talked about AI, crypto, brain-machine interfaces, fusion energy, and human longevity. Most longevity stuff is snake oil, but two trends are making it tractable: AI can test hypotheses for drug discovery, and single-cell sequencing costs are falling exponentially, like Moore's law. We can now sequence a single cell for 5 cents, down from $500. A scientist told me about epigenetic reprogramming, which can restore a cell's function to a younger state. I was like reading the Bitcoin whitepaper in 2010. I co-founded a company with Jacob Kimmel and Blake Buyers. We've demonstrated restoring function in human cells. We have humanized mice models where old mice recover from alcohol like young mice. It could take another decade for human drugs, but it's exciting. I've committed $100 million of my own money.

H

Host2:37:56

And what kind of things is that going to be able to solve?

B

Brian Armstrong2:38:01

Imagine we all lose function as we age. The biggest killers are heart disease, cancer, diabetes. Maybe the root cause is cells losing function. Instead of treating diseases, we could restore cell function. If you can solve that meta problem, it minimizes many later diseases. For example, GLP-1 drugs like Ozempic are a trillion-dollar market. If longevity drugs work, everyone over a certain age would take them. It could add 5 to 10 years of healthy life initially, but the moonshot is indefinite lifespan, not immortality, but perpetually renewing. There are philosophical debates, but curing disease and giving people the option to live longer are unequivocally good.

H

Host2:39:57

Do you think it would make an older person look younger or just stop aging?

B

Brian Armstrong2:40:37

We don't know for sure. We've restored function in human cells, not just stopped aging. For example, skin has an extracellular matrix that deteriorates. If we restore skin cells to a younger state, will they repair the matrix? We don't know yet. In liver fibrosis, young cells might repair scar tissue. There's evidence that young bodies can regenerate, like babies healing without scars. If we can unlock that in adults, it might be possible. We have a high-throughput screening system testing millions of combinations of transcription factors to find sets that revert cells to a younger state. We don't fully understand the biology, but we're using AI and single-cell sequencing to find targets. We'll start clinical trials in the next year or two, and hopefully have candidates in 5 to 10 years.

H

Host2:42:36

So you're injecting proteins via lipid nanoparticles?

B

Brian Armstrong2:42:40

Yes, delivered via lipid nanoparticles into cells.

H

Host2:44:56

How far out do you think you are?

B

Brian Armstrong2:42:53

We're starting clinical trials in the next year or two. We have two or three other programs. Within 5 to 10 years, we hope to have candidates that people can get prescribed. It takes about $2 billion and 10 years to get a drug to market, with many failures. We're putting a lot of capital into this.

H

Host2:43:44

So you're getting ready to be introduced to another type of bureaucracy.

B

Brian Armstrong2:43:49

Yeah, the FDA. They are trying to optimize because China is making quick progress. If a drug passes Phase 1 safety, we could allow doctors to prescribe it while Phase 2 and 3 are ongoing, especially for terminal patients. Right-to-try laws exist but haven't gone far enough. We need to accelerate or companies will run trials overseas.

H

Host2:45:18

Do you have any idea how much more life somebody could experience?

B

Brian Armstrong2:45:35

Initial drugs might add 5 to 10 years. The moonshot is indefinite by rejuvenating multiple cell types, especially the brain. That's the holy grail. If it works, you could perpetually renew. There are sci-fi implications, but I think it's worth pushing on this frontier.

H

Host2:47:14

Do you think it could cure Alzheimer's?

B

Brian Armstrong2:48:46

In theory, yes. If we can reprogram brain helper cells to clear plaques like when you're younger, it might help. We haven't started on brain cells because it's expensive, but we'll get there. If our bodies are functional but the brain is failing, what's the point?

H

Host2:51:39

Sorry to pepper you with questions. Could it prevent Down syndrome?

B

Brian Armstrong2:51:53

That's a different area. Down syndrome is about an extra chromosome. However, embryo editing is emerging. With IVF, you can sequence embryos and choose the one with the best chance. In vitro gametogenesis could create thousands of embryos from skin cells. Then you can make edits to prevent disease. Eventually, people might edit for traits like intelligence or depression risk. Society will have to decide. I'm not working on that, but it's intellectually interesting.

H

Host2:55:05

What advice do you have for new innovators and founders?

B

Brian Armstrong2:55:16

The big picture advice is that action produces information. People often have analysis paralysis. You need to start doing something, even if it's wrong. It will give you clues about what to do next. At Coinbase, the first version was completely wrong, but releasing it showed me the right way. It's like climbing a mountain in fog: you can only see a few feet ahead, but you have to take steps. Most people never take that step because of fear of looking stupid. Many tech founders are on the autism spectrum and don't care about social judgment, which helps. So just start.

H

Host2:58:05

If you had three people you'd like to see on this show, who would they be?

B

Brian Armstrong2:58:16

Elon Musk would be great. Also, Keller Rinaudo from Zipline and another biotech company. Brian Chesky from Airbnb is a rockstar building nuclear submarines. In the crypto space, Jesse Pollock on our team who created the Base protocol and app. That's a good start.

H

Host2:59:53

All right, Brian, thank you for coming. I appreciate the time, and I hope to see you again.

B

Brian Armstrong2:59:59

Thanks for being interested in what we're up to. Thank you.

#222 Brian Armstrong - Co-Founder & CEO of Coinbase

About Brian Armstrong