Thank you for joining us again. My name is Daisy Guevara, and I am the Director of External Partnerships for the Blockchain at USC club. I'm honored to introduce our next fireside chat featuring three incredible leaders: Jan van Eck and Geoffrey Garrett, as well as Jon Ledecky. Jan van Eck is a visionary leader in the financial industry. He is the CEO of VanEck Associates Corporation, and under his leadership, VanEck Associates has become a global ETF powerhouse. His experience spans from traditional finance to cutting-edge technology like blockchain and cryptocurrencies. Moderating this fireside chat today is Geoffrey Garrett, the Dean of Marshall School of Business at USC. He has spearheaded transformative initiatives like the Business of Blockchain, positioning Marshall as a leader in education and innovation. As mentioned, joining us as well is Jon Ledecky, owner of the New York Islanders and the uncle of Katie Ledecky. Please join me in giving them a warm welcome.
Okay, good afternoon, everybody. Can you hear me? Okay, perfect. We have a fantastic conversation ahead of us for the next 39 minutes and 50 seconds. Part of that conversation will be with Jan van Eck, talking all things crypto. But we have a special guest: Jon Ledecky is here today because there's an important hockey game happening in Los Angeles tonight, and we thought it'd be fantastic to have him on the stage with us. So Jan was just telling me I can't ask him any boring questions about crypto; I have to ask him some more interesting questions.
Sophisticated USC crowd, right?
Yeah. But I think everyone in this audience knows, not only has Jan and his wife Cynthia supported our digital assets initiative at Marshall and USC, for which a million thanks, but you've been early and deep in crypto, including when it wasn't the flavor of the month in the United States. So now you've lived through a lot of that, and I wanted to just give you a chance to start by talking a little bit about the business. I know you don't want to do that, but you wanted to get into crypto ETFs, you've managed to do that, before that you were in Europe. Tell me about how the institutional investor environment is today where cryptocurrency is concerned.
Sure. It's great to be here. I think, where are we in March of 2025 with investor interest in Bitcoin and other digital assets? I guess I think we're further along, but there's still a long way to go. Last year, I like to say it was a little bit of a bittersweet year. Obviously, it was fantastic that ETFs got approved in the United States; we saw billions of dollars flow into those funds and access Bitcoin. But the investor base was very biased towards individual investors. In fact, BlackRock says that the majority of investors into their ETF were first-time ETF buyers, so maybe crypto-native people, but definitely a younger demographic. And that's great that they were involved, but they were in a way already involved.
So then you take the financial advisor community. The biggest brokerage firms in the country still have not approved Bitcoin in the sense that they can't solicit Bitcoin for their clients. Institutions have barely gotten over the election and started, after staying away from crypto for a while, started to look at it. So it really didn't go forward that fast. And one last thing I think it's very important for people to note is that the correlation between Bitcoin and the NASDAQ was very high in the second half of last year, sort of a 0.6 correlation. And when many investors were really worried about Nvidia and the overweight to mega-cap tech stocks, the last thing they wanted was another investment that was just going to accentuate that NASDAQ risk in their portfolios when they were trying to go the other way.
Fast-forward to today: long-term correlation of Bitcoin against traditional stock indices is zero, and now it's 0.2. So I think that's really good. Bitcoin is a long-term dollar hedge.
Well, that and diversifier.
Right. And you're not going to add something to your portfolio if it just acts the same as something else.
Okay. And I was reading, you've got a great crypto team at VanEck and you put out all of this information that the public can access. So I was looking at—somebody in your team did a portfolio analysis that was suggesting that people should—I don't know whether this is people or institutions—should have a 6% or 7% allocation to crypto. So where are we today, and do you think we're on a path to getting somewhere near that?
Sure. Listen, I mean, Bitcoin has performed so tremendously well, you can justify—I mean, I own more than 30% of my personal portfolio in it.
I just know you're one of the biggest risk takers in the world, so that's no surprise.
And so that's where you get—I would say that, again, for most professional investors providing advice to your average investor, they're not using Bitcoin at all. So I say just start with something, start with a quarter of a percent to get involved. But I'm also still of the school—I think it's yet to be disproven—that Bitcoin doesn't follow the traditional four-year halvening cycle, which means three good years and one bad year. We're in the third year of a good year, so we're optimistic about its performance this year. But then Bitcoin does have the ability to go down still 80%, and so next year would be the year where you might want to relook at that all.
Okay. So let's move on to Trump 2.0. Obviously, there was a pretty strong anti-crypto sentiment in the Biden administration and the SEC, Lina Khan, the things that I'm sure everyone in the audience is well aware of. Trump wants to be the crypto president, launched a bunch of memecoins. But we've had these two serious things: one is a pledge to deregulate and bring the industry back to the US; the second was this announcement of crypto strategic reserves last week. What's your scoring of maybe not so much where the Trump administration has gone in the last 50 days, but where they'd like to go in the next year or two years?
You know, I'm not a fan of the kind of memecoin, and I know this is being recorded and everything like that, but what I think—if you're building software, I really am a big believer in what they call the safe harbor provision, which means build your software—and you wrote a great op-ed on this a couple of weeks ago, so thank you. Just disclose, tell people what you're doing, number one. But I'm also a big fan of a lockup for a couple of years. I mean, if you're developing software for the long term, then own that token, whether it's a memecoin or whatever, for a couple of years and disclose that. There's a lot of bad pump-and-dump behavior in crypto where you buy it, you're part of the promotional team, you get retail investors all hyped about it, and then you sell it out. Then you're profitable and you leave everyone else with the losses, and that's not behavior that should be protected.
Okay, so that's one element of an appropriate crypto regime. Anything else you'd recommend that we think about from the regulatory side? Should we regulate it as a commodity, regulate it as a security? How do you feel about that sort of macro question?
Well, I think defining what a token is, when a token can be a nothing like a memecoin or a collectible, or actually like a share of stock that gives you either revenue or profit rights, it's a very complicated thing. They're trying to deal with that and kind of put something that's hard to put into categories into categories, so I wish them well. I think one of the most important things that the Coinbase people talked about before lunch is stablecoins this year. I'm really crossing my fingers that they allow stablecoins to basically be digital dollars without a lot of strings attached, meaning make sure that there are securities standing behind that stablecoin, but don't make it so that you have to be a bank to issue one. I'm still a skeptical New Yorker; I'm very worried that the 2:00, 3:00, 4:00 AM legislation goes through and the bank regulators get their hands on it. So I'd be very happy if just that happened.
So I'd love to talk a little more about stablecoins, particularly since you told me I couldn't ask you whether crypto was a store of value or a unit of exchange. But we're on the unit of exchange side here. Why are you so pro-stablecoins? Is it because you want to take out all the commissions in financial transactions?
Okay, so we're going to talk about the New York Islanders, but the New York Islanders sell a lot of tickets and they use credit cards, and the credit cards take 3%.
So Jon would like that 3%.
No, split it. I understand that. And we've got SWIFT and ACH and all of these things. The incumbent pushback against stablecoins has got to be pretty intense, right? Because their entire business model is at risk here. How do you think that's going to play out?
Sorry, that was my answer to your prior question: don't celebrate yet, right? Everyone thinks, 'Oh, it's Bitcoin reserve, this, that, and the other thing.' Let's get stablecoin legislation. Getting something through Congress is really hard, and so let's just see if that happens.
Okay. So I know we want to get to the audience interaction as soon as possible, and we'd love to talk to Jon. So maybe I'll ask you just a couple more big-picture crypto questions. The data center story looks enormous, right? Electricity production in the US has been flat for 30 or 40 years; in China, electricity production has been going up. All these curves about data center demand, crypto plus AI, are off the charts in the next five years. How do you see that? Is this going to be a real constraint in the US? Can supply meet demand in an environment of such high demand?
Listen, I think with deregulation—and there's now bipartisan support for nuclear power as well, so not taking those facilities off-stream will help a lot. I do think that we will get that production going. In the meantime, natural gas unfortunately is a big swing energy provider. It already plays a large part in electricity, and I think that'll continue for the next five years as a bridge to nuclear and others.
Okay. So in the US, that means advantage Texas. Does it matter where miners are, where AI data centers are? Are we living in crypto—so let's say, does geography matter, or is geography now irrelevant except for the regulatory environment?
The beauty of Bitcoin is we've had tests of a lot of these things, right? China took their miners off-stream for the most part, right? I'm sure it didn't go down to zero, but they were doing over 30% of the Bitcoin mining globally speaking, and it basically went to zero. The network changed its adjustment mechanism, and it worked. So it is a global asset. There are a lot of stranded energy sources around the world, whether it's volcanoes in El Salvador, what have you. And I think the Bitcoin mining industry has made a big effort to be clean in terms of the energy sources that it uses. But to your point, it is a drain.
Okay. Maybe last question before we bring Jon in: crypto capital of the world. Singapore wanted to be the crypto capital. There was a regulatory race to be the most crypto-friendly. Do you think the US should be the crypto capital of the world? Will the US be the crypto capital of the world? Does it matter?
Well, I mean, I think people in the industry know it's a global industry. Especially during COVID, there were nomads everywhere, and people have had to travel to Hong Kong, Singapore. I'm going to Dubai against my will in six weeks just because it's a nice place in the winter. Dubai, I'm on the cusp of summer, so I suppose I've got to get out of there fast. But no, it's a global industry. I think a lot of the development and capital formation is coming out of New York where I live, which is great. So what's good for all the people in crypto is maybe they don't have to go to as many conferences a year and get to sleep a little bit. I see founders, and we saw some this morning, and it's just a really tough lifestyle. So to answer your question, I'd say New York, but I hope people get a little bit more sleep.
Tough lifestyle because it's 24/7, but because you've got to be there in person, there's something real about 3D three-dimensional humans interacting with each other, or because the market never sleeps, or both?
I guess it's both. I mean, I think the institutions—Bybit and Binance, two of the largest exchanges, are Asian-based, right? And then we have Coinbase. It's just a global industry, so that's why.
Jan, I have a question for you along those lines. Today it was announced that we're moving towards a 24-hour stock trading exchange, which will match Bitcoin. How do you see people as human beings, to your point, how do you see them living their lives? I mean, if you have to every hour wake up and look at your phone or screen, will there be more personnel because the industry will grow because there'll be a need for people to be on desks 24 hours a day, or it'll just hop, skip, and jump to other countries that will be passed along, so New York closes and then you go to Asia and then you go back to Europe? Is it going to be something like that?
Yeah, that's the way the big banks like UBS will pass its book globally, right? They'll have teams in Europe, the US, and in Asia, and that already happens. Our biggest ETFs like GDX trade 24/7 as it is, and you can do a $50 million or $100 million trade in that ETF no problem any time of day. What I'm worried about, Jon, and it's a great question, is you have investor protection rules during the middle of the day in the US, not at the open or the close, but during the day. And so if there's an ETF that trades at 20 bucks, you could pay 30 bucks a share if you do it overnight.
So you don't see circuit breakers globally?
Right now, the way the rules are, unless your broker-dealer protects you from that kind of stupidity, you can lose money. A lot of people from Asia, frankly, will put in trades for US securities and say, 'I want it,' and it's executed at the open. They don't know they're not protected at the open, and you see something change 5% or 10%, and then suddenly it settles.
So one way to go was the conversation you just had about the US becomes Asia, becomes Europe, and then back to the US. The other way, people are saying that 2025 is going to be the year of the AI agent. How do you feel about AI crypto? Are we going to live in a seriously intelligent robo-world?
Listen, I think the big winners on AI are the people who have your data, and give you a better customer experience. What I always say is my Netflix experience is horrible because Netflix doesn't really know all the things that I like to watch, and doesn't know my email chain and my friends and that kind of stuff. China has these super-apps where a lot of their lives are lived on one or two applications, and the US is fighting for these customer eyeballs, if you will. I don't know how crypto matches into that other than we want data security, right? We don't want that data to be manipulated, and so that's crypto's primary role, which is more of an infrastructure role.
So on the last topic, lots of renewed enthusiasm about Chinese tech since DeepSeek, but with some other things as well. Alibaba now is supposed to have really high-end AI as well, and you were referring to Tencent and WeChat for the super-apps. Does the US need to move in that direction? You look at Meta or Alphabet, they could integrate their platforms; they've chosen not to integrate their platforms.
That'll be an interesting thing under this new deregulatory regime, right? Because Facebook wanted a stablecoin, right? Libra. I think we've had the head of that project on this stage at this conference. So far, they've been pushed away from being banks or getting heavily involved in the payment infrastructure. So we'll see if that changes. I would presume not here in the US; the regulators like to protect banking services.
Just to press on that one for a second: that is a distinctive feature of Alibaba and Tencent, that people have got a lot of money sitting on the platform, so of course somebody's got to manage that and invest that. It seems a natural path to go down, but we're unwilling to do it here.
So far, it's been more regulation and business practice, I think. Look, Facebook was told directly by the government, 'Do not do this. Do not have a stablecoin.' And it was a double whammy for them at the time: Facebook was not the flavor of the month, and cryptocurrencies were not the flavor of the month. I wonder if that can come back.
Right, that was sort of at the height of the Biden anti-crypto sentiment, if I remember correctly. Should we bring Jon in more? He's asked a great question. This was my stupid idea to invite Jon here. So Jon, again, to me, this was a natural fit at USC because Jon is, first of all, a very successful business person, co-owner of the New York Islanders, but also has a connection to the sports world.
My view of the world: in 2028, you're going to have the election with Trump not being able to run, and you're going to have the Olympics right here on campus. Think about that. How exciting is that going to be to have part of the Olympics here? I think listening to your conversation, to me, that may be the catalyst for all the things you're talking about because the world is going to come to Los Angeles, and Los Angeles has this positioning of being out there with innovation and enthusiasm for things like stablecoins and crypto. Visa is a huge sponsor of the Olympic movement, but will the LA 28 movement start to embrace the use of crypto and stablecoins for the tickets?
The amount of heat around the tickets for the US Games will never be greater. And for the first time in history, the Olympics will not have swimming and gymnastics at the same time. They're going to have the opening ceremonies at SoFi Stadium, then they're going to create the world's largest swimming pool at SoFi Stadium. 50,000 people will be able to watch the Olympic swimming. The first week will be just gymnastics. That's because of the role that NBC plays in the Games. But the heat that I see around the ticketing already, and the cross-border and international desire to be in Los Angeles for the Games, that worldview is coming into focus. We're talking to Dean Garrett, who's from Australia. The Pelicans basketball team are going to play in Australia next year. You have the NFL playing all these games in Europe. You're going to continue to see all the major leagues move into playing in different countries.
Of course, we've got to expand this conversation a little bit. I am Australian, so the fact that cricket is in the Olympics in 2028 is a very big deal. It has the possibility—we can't see the audience, so I apologize if I get this wrong, but I suspect there are some people of South Asian heritage in the room today. Cricket is a religion in India, right? But Indians are also incredibly good at tech. The reason cricket has become a global game actually is because the Indian diaspora is so powerful and they're so into tech that you can connect all of this stuff. But go back to the connection between crypto and sports. I don't know whether you've been to the Intuit Dome, Steve Ballmer's arena?
I have. I sat with Steve. Steve and I were classmates at Harvard, and I was the public address announcer for the basketball team and he was a statistician, so I sat with him for two years.
What do you think of the stadium? He wants a fan experience, but he wants tech in everything.
Yes, tech is in everything, and it's going to be a fabulous future in sports. Sports are the only thing that I think you need to watch live. Everything else will be on demand. You don't need to watch the Netflix drop live; you can store it and watch it at your leisure. But you can't sort of avoid going around trying to stay in a bubble because you didn't watch the Super Bowl live and you want to watch it on video replay. There's no way you're going to get to your home and not know who won. So the immediacy of sports, the live nature of sports, and then of course that leads to the question about gaming and gambling. I think that's what's going to engage the generation of students who are here: the ability to do real-time buffering.
Right now on television, most of the things you're seeing are seven-second delays. So they're working on a technology where it's real-time, so that you can bet on the next pitch, you can bet on the next play in football—will it be a throw, will it be a pass, who will catch it? All the prop betting, small-dollar amounts will be integrated into the experience, because my niece and nephew's generation can't sit still for three hours and watch a sporting event. They have to have that stimulus, whether they're there live or whether they're watching it on their phone or on television.
Back to the crypto conversation, Jan: stablecoins or other things are well-suited to this, right? Instantaneous, no transaction fees, etc. We have three concerns about the use of crypto: one would be it's a place to launder money under a veil of anonymity; second would be these crypto hacks, right, we had the $1.5 billion; but the third, I think, is that the ability to regulate gambling, which in the US is on a state-by-state basis, just gets blown out of the water if you're in a crypto environment. Does that matter to your thinking, or are you back at dollar hedge and all the other things that we started talking about?
Demographic, and I think part of what Jon was talking about—it's so interesting to hear you, and I haven't talked about that before—part of what we're facing is we're going to lose our future fan base if we don't engage them on the platforms that they want to be engaged on. If a person has a Coinbase account or a crypto account, wants to bet that way, wants to talk about the team that way, then they're going to go do that. Listen, I think one of the important things for the financial markets is the evolution of this thing called prediction markets, where people were betting on the outcome of the election, and frankly they were better than most of the polling that came out. So people on Wall Street are talking about upping the amounts of that and making that much more part of the investment landscape.
Polymarket was illegal in the US, right, but offshore, and an incredibly accurate prediction.
