Anthony, thanks for joining us on Tearsheet Podcast. So, who are you and what do you do?
Well, I'm Anthony Scaramucci. I'm the founder and managing partner of SkyBridge Capital. It's a couple billion dollar investment shop, and about six years ago we flipped the shop into a crypto shop primarily, and some late-stage private equity.
Awesome. Well, welcome to the Tearsheet Podcast.
We also run the SALT conference, which I think you're familiar with, that started in 2009, and we've done probably 30 of those around the world.
What was the, I guess, genesis moment for flipping into a real-world asset shop? What did you see six years ago to make that change?
Such a great question. I was such a crypto skeptic and such a Bitcoin skeptic, and obviously I missed the freight train at Bitcoin at 500, 600, 2,000. I think I bought my first Bitcoin at 6,000.
It wasn't bad, but and then I bought a ton more like in the 17, 18,000 zone. Look, really smart. I mean, I bought nine figures worth of Bitcoin in October of 2020, and for clients, myself, etc. And people thought I was crazy. Some people actually fired me, and it was fine. That happens. But I think the eureka moment for me was understanding what money actually really is. And I didn't really understand it prior to that. Once I got what money was, I was like, 'Okay, wait a minute. This is money. This is actually, from a technical perspective, it's like the purest form of money.' And then I got very excited about it. I had a meeting with Michael Saylor in September of 2020, the MicroStrategy CEO, and he had bought maybe, I think he bought his first bitcoins. I mean, we'd have to verify, but I think he bought his first bitcoins in August of 2020. And so we got on the Bitcoin train in October for those reasons.
So we've seen a lot of growth of real-world assets moving into tokenization. I think we're at like $40 billion today, something like that, stocks and bonds. What needs to happen, I guess, for that to continue accelerating? What hurdles are in the way?
Well, I think the biggest hurdle is U.S. regulation. I mean, ultimately, when I travel the world, the regulators say to me it's a match sailing race, and whatever the U.S. is doing, that's going to guide our sail. And so it's been a waiting game for the U.S. to provide clarity, which the act was well named, but you know, we didn't get the Clarity Act passed. But the good news for the U.S. is Paul Atkins knows what he's doing. He's a big believer in the digital economy, he's a big believer in DeFi, and I think he's going to effectively make law or administrative guidance, as they would say, that's pursuant to the Clarity Act, in some ways may even be better than the Clarity Act. And then what we would then need is a flywheel of adoption. We'd need somebody like Larry Fink or J.P. Morgan, or you pick the firm, to start adopting the ideas of tokenization and creating the 24/7 trading and the perpetuals and things like that. And then the genie is out of the bottle. You know, if you get another Gary Gensler, as an example, you won't be able to put the genie back in the bottle. So we've got two years to create that positive momentum.
That makes a lot of sense. Beyond treasuries and stablecoins, what are the next assets you think to get tokenized?
Well, I would like to see stocks tokenized. I mean, because ultimately, if you tokenize the stock market, you know, even though treasuries is our deepest market, mortgages is our second deepest market, the bond market is way bigger, broader, frankly even more liquid than the stock market. But stocks are where people follow, you know, stocks are where people give people the vim, you know, the testosterone, the juice. Yeah, exactly. The testosterone shots coming from the stocks, you know. So if we can get some of these stocks, you got the top 10 market cap stocks in the United States on chain, I think that would revolutionize everything. And also, I think there's a lot of misinformation out there. And there's like, I don't know if you saw this ad that was taken out in the Wall Street Journal two days ago, just decrying tokenization and all this suggestive lies that you could lose your stock or it's not really, you don't own it, and all this sort of, it's a synthetic, and all this sort of nonsense. I think you have to get it out there, and then you got to create this proof of concept, and then once you do that, everyone will have to do it because what CEO is going to be like, 'Okay, my competitor is allowing for 24/7 liquidity, but I'm not?'
Almost like a marketing thing, you want to be where your investors are, right? So even though the stock market's not our biggest market, it has, like you were talking about, the juice or the vim or whatever, that brings the attention to it, that has some type of spillover effect, I guess.
It's got the sequins and rhinestones. You and I both know that.
All right. What makes a tokenized asset useful in practice, whether for trading, lending, or serving as collateral across platforms?
Well, I mean, it's virtually frictionless. You know, you're going to have lower costs. You know, you trade a stock now, you got to go through six or seven intermediaries, depending on where you're trading it. And this is a one-to-one. This is going from my wallet into your wallet fairly instantaneously. You know, when I started in the industry, it was trade date plus five. So five days. Now, it's trade date plus one.
Yeah. Well, T+3, now it's T+1. And you're, you know, it could be T+an hour.
We both know that it could be T plus minutes.
Maybe the regulators never let it happen like that, but it could happen like that. And just remember, when you're taking intermediaries out of a trade, you're going to save money. And I would submit to everybody listening, just Google what the third-party payments are globally. So this would be credit card transactions, this would be wiring fees, this would be cashier's checks that you have to get charged for when you're going to the bank. We don't like and we don't trust each other, let's face it. So we've always used a third-party intermediary to sanctify the transaction. But now you have this sort of decentralized system known as a blockchain, where we could just decentralize the whole thing into the blockchain, and then we can go one-to-one and be fully trusting of each other because it's been sanctified and blessed by the blockchain. And so it's a very powerful technology, and that would probably save the world, depending on the estimates, anywhere from three to four trillion dollars a year.
That's really interesting. But one of the things we're seeing is sort of the reformation of traditional finance onto the blockchain. Even though you're talking about, like, the dream is to make it one-to-one, but like we're seeing some of the same types of gating structures moving there. What does it take to get to the system that you're describing, where there is trust between me and you?
Well, again, you know, it's adoption, so it's got to be first mover. Like I said, if you get the 10 largest market cap stocks that are on chain and there's no problems and no glitches, people are like, 'Okay, I totally trust it. Let's go.' You know, I mean, the first person to take penicillin was probably worried. You know, now we're taking it.
It's like contactless payments in the U.S. You know, we were so late to the game, but like getting them on the subway in New York was one of the tipping factors to get people to start using it more. It's like you just needed some habitual...
