Okay. Great. Great theme music even. I mean, look who I get to have up on stage. Everything's great in Lisbon. And you've been traveling all over the world.
I have. I've been marketing my book. I've been on a little bit of a book tour.
Okay. Can we just say a few words about your book right away? I told him I wasn't going to market his book anymore, but I love his book, All the Wrong Moves. Where can it be easily acquired? At the book signing after?
Yeah. Well, we got a ton of books here. As I tell people, I wrote an international bestseller. And if you don't believe me, come into my basement. I'll show you every copy I bought to make it that.
But yeah, no, it really is a good book. But he is doing a book signing after. You should join that. But we are not here to talk about Anthony's book as much as he might like us to be. The last time we were together, Anthony was interviewing me and I get to interview him now. But I want to talk about tokenization a bit. I love the way you think about it — you bring economics into the conversation so much of the time. The financial system has been, or is being, reshaped by tokenization. You guys have your own assets tokenized at SkyBridge. Today roughly 39 billion dollars of real world assets sit on public chains. This is meaningful for our industry, but not so much for the global financial industry. So when you think in macro terms, what does it actually take to get even a few percent of that trillions onchain, and what has to be true in the economy, in the plumbing, and in the policy to make it all work?
Oh, I mean, I think the first thing is US regulation. I mean, ultimately that's the tip of the spear, and I think a lot of the other countries look to the US for guidance because the US is the deepest, most liquid capital market, and so they'll more or less copy what US regulators are doing. And so think of it like a match sailing race. Everybody's trying to line up their sail pursuant to whatever the US is doing. So the bad news is we didn't get the Clarity bill passed. Did you actually think we were going to?
No, I didn't. And you and I talked about that. You know, I don't know if you remember, we were at that bar in Jackson Hole.
And I said, people are talking about this getting passed. It's not going to happen. And I think I did a podcast with Jackie Melanick talking about that, that it wouldn't happen because unfortunately we just have such great dysfunctionality going on in Washington. I give you a shout out.
Right. See? Right. So, you know, and I did say, didn't I say it wasn't going to happen in that podcast? And that was a week before the vote because unfortunately I understand the dysfunctionality of Washington and I've got my 11-day PhD in Washington dysfunctionality. So, but I do think that Paul Atkins is doing a very good job of regulating, if you will, and creating the laws from the administrator, from the SEC. And why is that important? Because guys like Larry Fink, Brian Armstrong, Danell Dixon — you guys know if we can just get the wheel started and you can go from 39 to a hundred billion dollars of assets and BlackRock starts tokenizing and others, then the horse is out of the barn. And if Gary Gensler, the worst SEC chairman in US history, returns, it's too late. He won't be able to unbundle what's already happened. And I think this is an indictment of our system, by the way, because ultimately what a good regulator should do is what's good for the customer, what's good for the businesses, how do I help the United States maintain its mantle and financial leadership. But that's not what we're doing. We have right-leaning regulation and we have left-leaning regulation as opposed to what's right or wrong for people. But we've got two years to go here with Paul Atkins, and I do think you and I hopefully will be on a stage a year from now saying that that 39 billion dollar number is closer to 100.
Yeah. What I've always said, and we just were — I was just in DC a couple weeks ago — and I feel like if we push this industry to not just have the assets tokenized but to have it be moving, like that money has to be used in leverage, it has to be used in lending, borrowing, has to be used as collateral. We've got to be able to make that all happen. If we can do that in the next two years, I think that it's not going to become a thing if a new administration takes over. But is the US market — why is that so important? Why is the US regulatory market so important?
Well, I mean, listen, the United States is still arguably the largest economy or tied for the largest economy, but it's the deepest capital market. It's a deeper capital market than China even though China has roughly the same GDP of the US now, and we still are the reserve currency from a fiat perspective. And the stablecoins, as you know, are being denominated in dollars, which is actually quite beneficial to the United States and beneficial to us maintaining our status, if you will, as the reserve currency. So all of those things make it important. And you travel around the world, I travel around the world. When I meet with regulators, they invariably say to me, 'Yeah, we're waiting for US regulation, waiting for US laws because we're just basically going to match theirs.' You know, it's interesting even in like the TSA, believe it or not, they match our TSA around the world. You know, people don't realize this, but we have like treaties where if you're flying into the United States, we have to have TSA people on the ground observing the luggage that's going into the plane. It's sort of the same sort of thing.
Yeah, I think it's — I do think it's really important. I do see certain markets, a lot of them moving in pilots though, and I wonder if Clarity had gone through, if we wouldn't see so many pilots, we would actually see real activity in those markets.
Oh, yeah. If Clarity had gone through, you would have forced all the commercial banks into the water. You know, and the commercial banks obviously don't want this because it's lots of competition. They certainly don't want stablecoin yield because that would really be a big threat to the fractional banking system and they would be very worried about deposit migration and all those different things. But it's coming. I mean, this is the thing that you can take this to the bank: if you have better technology, there's a resistance, but the resistance is ultimately futile. Better technology gets adopted. You know, the mayors didn't want the horseless carriage. They were very satisfied with the horse and the buggy. But they ended up getting it. The taxi commission didn't want Uber and the ride-sharing technology, but they ended up getting it. And if you're going to be able to trade 24/7 around the world, which some people say, well, that makes things more risky — I stipulate that it doesn't. The more liquidity — we know, study after study — the more liquidity and the more open the market is, the more relaxed people are about their positions. And so long-term, it'll actually reduce volatility and be better for everybody. And that's something — if you had Paul Atkins sitting here, and I know Paul forever, I was on the Romney transition team with him in 2012 — if you had him sitting up here, he would say that very thing that I'm saying. So at least we have people in positions now that get it and are fans of the industry and advocates of the industry, and advocates frankly of Stellar. I mean, because you do have a, you know, second-to-none technology interface for this sort of activity.
I didn't want to make this about US politics, but I just have to ask this question because for those of you that spend any time at all looking at what happened with Clarity and now what's going to happen in the future, we have an SEC commissioner and there might end up just being that SEC commissioner and no others, right? SEC chair and maybe no commissioners on the CFTC, which is also a regulatory authority that governs this particular market other than spot. Right now, there's just one — there's just the chair. What does that do in the future when we just have the chair, two chairs who are making this regulation?
Well, I mean, that's the pendulum, right? That's the thing you'd have to worry about because if you just have the chairs without the commissioners, you know, usually what we've had is a bipartisan commission. And prior to all this partisan rancor, they used to work together and try to compromise and get to good regulation slash good legislative recommendations to the Congress. You know, remember back in the day, somebody like Arthur Levitt — people probably don't remember him, but he was the SEC chair.
No, because we're really young.
A lot of us have — you guys are really young, but I'm not. So Arthur Levitt basically, he would offer up regulation to a bipartisan House and Senate commission, and guess what they would do? They would say, 'Okay, we're going to pass this regulation. This is what the regulators think is the best practices for the US.' And he was the one that moved us to decimalization. I mean, I'm old enough where we were trading in eighths and quarters, you know.
Okay, when you think about what's missing onchain today, we have mostly treasuries — so US treasuries, other treasuries, non-US debt. What instruments do we need to see onchain to really take us to where we want to get to in the next two years under this administration, certainly in the US?
Listen, you take the S&P 500 — if you told me that we had 10 or 12 of those names that were tokenized and they were able to trade 24/7 on the NASDAQ or the New York Stock Exchange, I would say that you're on your way. Because what ends up happening is the CEOs of these other companies would look at that and say, 'Okay, wait a minute. That company's trading 24/7 and they're basically providing additional liquidity to the investors, and now I'm at a disadvantage because I'm not creating or providing that additional liquidity.' So that's the sort of thing that would create the flywheel that you would want. You know, you would have to get people like Terry Duffy at the CME to calm down a little. You know, he doesn't like this stuff and he's trying to block it. And we had perpetuals, you probably remember this, a few months back that were about ready to trade. And you know, Terry's a good friend of mine, I know Terry forever, but he's an old-school guy and he'll use all of his influence and muscle to block this stuff. But it's coming, and to me, I would rather accept it — you know, as I've had conversations with him, let's accept where we're all going and let's try to just create the best practices when we get there.
Yeah. One of the things we've seen in the last couple of weeks is about the equities and this whole innovation exemption from the SEC. So this showed a lot of momentum in the beginning, and now we have all these different companies trying to opt out of having their equities put onchain. Why?
Regulatory pressure. They don't want to go before the Congress. Elizabeth Warren's saber-rattling, you know. I mean, most people — you know, listen, I think Jamie Dimon is one of the most sophisticated, perhaps one of the smartest financial services business executives in the last 50 years, when he's calling Bitcoin a decentralized pet rock, but then spending 500 million to a billion dollars on — watch this hand over here, don't watch — and you've got research now, and you guys probably saw this. The private bank of JPMorgan put out an allocation and said, you know, likely asset that's going to be the most undervalued asset over the next decade, and they're recommending a 10% allocation to it is Bitcoin. But he's doing that because he's a smart guy and he knows he's got to go before those regulators. And you know, there's a great — I mean, if you guys like watching YouTube, because I probably watch too much of it, but there's a great scene where he's calling Bitcoin a decentralized pet rock, and I think like Elizabeth Warren's basically ready to have an orgasm and she's like so happy about this, and she's just, 'Oh, you're totally right.' It's just — and you can see him in the back of his mind like snickering, you know what I mean? And while he's building a, you know, multi-billion dollar Bitcoin business. All right, sorry. You knew there was going to be one or two things I was going to say up here to make you laugh, but go ahead. Sorry, just want to make sure everybody's awake.
