🚨 LIVE: SALT Digital Finance Forum Day 1 In Bermuda

Transcript

70 7 floors We'll see you around the timeline. Feels good to be back. I think The Rollup is one of the most premier media brands in crypto, and Andy and Robbie are great experts at everything they talk about, and it's my favorite podcast. Adding it to my library as we speak. Potentially multi-chain deployments. We are at Devconnect day one here at the session from Base.

>> JP Morgan, BlackRock, DTCC, Fidelity. The entire thing was just institutions. It's just It's next level. This industry is going to the next level. And guys, I I don't know what else to say. I'm bullish. HE SAID IT. HE FINALLY SAID IT. I'm so bullish. And he's bullish, I'm bullish, we're bullish. >> The Roll Up is headed to the top. If

we're not already at the top, we're going to the top. >> The Roll Up is my favorite. >> From all walks of life, all over the world, all over this industry, come together for the Roll Up. The Roll Up is headed to the top. If

we're not already at the top, we're going to the top. >> We're going. The Roll Up is my favorite. >> From all walks of life, all over the world, all over this industry, come together for the Roll Up. Survive your mouth.

The Rollup is headed to the top. If we're not already at the top, we're going to the top. >> Let's go. The Rollup is my favorite. >> From all walks of life, all over the world, all over this industry, come together for the Rollup. Subscribe to Zoomout. Institutions

aren't coming, they're simply here. This is the Rollup major crypto, guys. Get right. Let's go. Welcome to the nest. See you on the show. Let's go. We are live from the Bermuda Digital Finance Forum. We're on island time, Rob. >> We are. We're here on island, as they say, and it is a pleasure. Uh the absolute journey that it was to get set up this morning was incredible. I think we had about two dozen people getting us set up. We got the backdrop, we got the chairs.

Shout out to everyone. Shout out to Near and shout out to Bermuda for hosting the Digital Finance Forum along with SALT and Penrose for helping put this on. I'm excited. We've got a full slate today and tomorrow. And what are you looking forward to? Man, I mean we came from Consensus Miami. It was very very hectic. It was a lot of kind of the more native digital asset investor crowd and folks. This feels much more like a allocator conference, right? It feels much more like an investor first, allocator first, policy first, implementation first kind of environment, right? And so thinking about how this technology is going to be used in practice, right? I mean just today we already saw news from the Bermuda government and Stellar

bringing some of their payments and stablecoin processes on chain. Bermuda's coming out and saying we want to be the first on chain economy Yeah. for a government that said that at the World Economic Forum in January 2026. Feels like this conference is the beginning of making that possible. Um And and I think they're generally seen as one of the most innovative jurisdictions out there, which is why they're going and embracing AI. They're embracing blockchain rails. And all of a sudden, you see what is typically a financial forum turn into a digital finance forum. I think that's a sign of the times.

We've got our first guest. >> Yes, we do. A lovely lovely friend Ian here. Ian, welcome to the show. Thank you. Thank you for being here. Uh how's the conference treating you? Conference is excellent. You mentioned our host, Penrose. They've done a fantastic job. Here on the island's second conference and also partnered with SALT, another great events company. It's a pleasure to be on the island for the first time. And uh you're part of the crypto uh regulatory uh complex in in the UK. Uh I'm curious, maybe you can tell us a little bit more. We hear a lot about clarity. In fact, I think we covered it almost almost every day if not.

Um and so it it got to the point where it's either going to happen or it's not. Things are starting to progress a little bit more. How do you see the crypto regulation progressing in the UK? Similarities differences generally with with the United States? Well, I can imagine when you're at Consensus you did have lots of conversations about clarity. Doesn't surprise me. It's been a long time coming for the US to start actually putting forward policy and getting legislation in place. And then the regulatory perimeter comes through. In the UK, we've been consulting on this with our government and our regulatory stakeholders for the last 5 years. At CryptoUK, we've been around for almost a decade and we've been instrumental in making sure our government has a

positive policy position for crypto. We saw that in 2022 and we're a little bit further ahead in having a regulatory framework. We already have certain requirements and our stablecoin regulations will land this year along with a host of other requirements for certain activities performed by certain market participants. And we at CryptoUK, obviously look to the US as the largest market in the world with lots of innovation and development within the blockchain sector. So we are now part of the Digital Chamber of Commerce, which is one of the UK's uh the US's largest industry industry associations to make sure that we work together because we're all tackling the same problems. How to regulate this new industry in a positive, proactive way that allows for

innovation. Yeah, incredible. Uh I'd love to understand a little bit more about, you know, some of the progress you've made in the UK so far. We had this villainous era with Gary Gensler at the at the head of the SEC. Uh the last administration was very anti-crypto and made it very clear that they were. Now things are starting to, you know, we're righting some of our wrongs and then we're moving forward as a result. While we were, you know, fighting tooth and nail internally, what was the UK able to do to progress the industry forward? Well, we saw two things. Firstly, on the direct investment side, all jurisdictions want to bring onshore economic benefit. And we're in Bermuda, and Bermuda has been very progressive in doing that, bringing capital here to set up within the blockchain industry. We see that in

other smaller jurisdictions. But one must remember the bigger um countries have a lot greater responsibility and requirements, so it takes a lot longer to get policy and regulation through. And in the UK, we've been working, as I said, for the last 5 years to get regulatory clarity. We have with the UK, we want a perimeter, a regulatory perimeter, that allows for organizations to operate, function, build new products and services, at the same time be mindful about such things as consumer protection. Yeah. Be mindful about in the event of bankruptcy, is there enough capital on the side to pay off users of a platform if indeed such events occur.

There's lots of similarity with financial services. UK, as you know, has a pretty big capital markets and financial services and a fintech sector. And so we use that infrastructure to help develop and build out what is already a pretty well-advanced regulatory framework in the UK. And naturally, the UK has in the past been part of Europe, and we know Europe does have MiCA, and some of the parts of markets in crypto assets, the wide-ranging regulation that already sits within that jurisdiction, is coming into the UK, and we'll see if we can have some reciprocity around that and share some ideas and learn some of the good things that were and maybe leave some of the bad things aside.

>> Yeah. Um we were at the DC Blockchain Summit just a few weeks ago. Um and the idea there was that there was a lot of innovation happening both in the SEC uh as well as the CFTC and the White House. All these agencies were starting to come together. Um over in the UK, how do you view these agencies? Are they collaborative? How can we ultimately build these, you know, collaborative regimes across the entire world, not just within the US, so that everyone is on the same page. Have there been any sort of contributions or generally when you're looking at clarity and genius, how much input, you know, can someone in the UK give on something like this and vice versa? Have you seen US counterparts provide some sort of input or contributions into the UK regulations? Yeah, it's a great

question. I was also at that summit in DC and it was great to see both uh heads of the big financial agencies in the US come together and say we're going to work together because as you said rightfully, um it's been a very different environment where there hasn't been any collaboration. And this industry, and this is one of the value propositions of blockchain, is collaborative in nature. It's open source, we work together, we have um organizations and foundations that collaborate to develop good products and services for users. Now, the UK has created a partnership with the US, transatlantic partnership, to share ideas and perhaps develop some form of reciprocity around different sets of regulation in crypto. This has existed in financial services for a long time.

There's been a good relationship there and perhaps the UK, now not in Europe, can move closer and work with the US. That's part of why CryptoUK and Digital Chamber came together to develop some of these standards and lean into this UK-US corridor, if you like. The UK has a slightly different regulatory environment. We're much smaller than the US. We only really have one regulator. We don't have to deal with a commodities regulator, we don't have to deal with a securities regulator, we don't have to deal with a bank regulator or an um or the office of comptroller for the currency. So, it's slightly easier for us to move the needle with our regulator, which is called the Financial Conduct Authority, which is a very big organization um and does great work globally, is well-respected. And then lift up another level and they have the

intergovernmental agencies, such as IOSCO, Bank of International Settlements, Financial Stability Board. These folks set overarching principles and guidelines that competent authorities, such as the UK, European countries, and the US can take and use them. So, they those organizations try and create global standards in collaboration, but we're a long way off any of that. But, I hope with the work we can do ourselves at CryptoUK with Chamber, talking to DC, talking to Westminster in London, we can get some form of cohesion together and have standards that allow for businesses that are global in nature to be able to build out a road map that doesn't isn't

confusing for different jurisdictions. Yeah. Yeah, one of the exciting things about being here is that Bermuda's taking this kind of step as a jurisdiction itself, similar to to the UK being like, "Look, we we want to embrace this technology. We want to embrace you know, blockchain rails, agentic rails." And I mean, as I was saying when we kicked it off, this country wants to be the first fully on-chain economy. You know, I'm curious from a just let's say a much larger a much larger country, what does that actually like mean or look like? Like, is there a real path to becoming a fully on-chain economy from one of the biggest countries in the world? How far fetched is that?

I I think it's achievable, but it's a lot more, how can I say, difficult or requires a lot more effort from all different stakeholders. Now, Bermuda has been very progressive. You mentioned the announcement at WEF by the president, David Burt, and also an announcement made today regarding onboarding merchants, local merchants, how to receive consideration for purchasing goods and services with stablecoins. I mean, that's a really good initiative. I would love to knock on the door of the Prime Minister number 10 Downing Street. He's got a few issues at the moment. I don't know if you've been following the news, so he probably won't open the door, but be able to have that access and go and say, "Here's a use case. Here's a value proposition.

Let's do this because this is the future." Technology doesn't care about governments, doesn't care about incumbents, doesn't care about boundaries. It just will permeate into our everyday lives because it does things faster, cheaper, better, right? That that we've seen that before with other technologies. That is just a fact. So, it's not a case of when it's not a case of if, it's just when. And so, with the larger economies, the more nimble smaller jurisdictions can move faster, right? It's like It's like working in a startup versus working for Goldman Sachs. Yeah.

>> That those big oil tankers can't turn around as fast as perhaps the more nimble speedboat, which is a smaller jurisdiction. From your perspective, is is the perception of you know, countries like Bermuda, which I think is still a British colony if I'm not mistaken. Uh do you see them almost as a testing ground? They're more nimble, agile, they can go and do things that maybe it would take a longer amount of time for you know, the UK or the US to do. And so, we can sort of learn quite a bit from these jurisdictions. See what works, see what doesn't work, and then take that back and and teach ourselves and ultimately implement on a longer timeline. Yeah, absolutely. And Bermuda is an overseas territory and has the use of the UK common law and the language and many of our cultural um exports from from the UK, but is a

sovereign country and can write its own rules um and it does. And so, what I think we'll see from the bigger jurisdictions, whether it be European countries, ourselves, or North America, they will look at these as like testing grounds and sandboxes, if you will. Is it working? What's working well? What's working bad? But remember, in the bigger countries, you have big stakeholders. For example, you talk about clarity and the genius act. >> Yeah. The banks. The banks might not like this direction of travel because it certainly don't. Because it hurts their business model. We see that in the UK. And you can look at Bermuda, its main industry is insurance. And insurance actually, there doesn't seem to be in my

experience that much of an overlap. We're not swimming in each other's lanes, blockchain and crypto services. In fact, the two can come together and support each other with particular use cases. So, that's a nice little model. Whereas, in the bigger jurisdictions, you have the incumbents that have a lot of money, have a lot of resource, have a lot of a lot of lobbying power with government that push back. And that's net bad for everyone. Yeah. But that is a fact of it. And and Ian, what you're kind of talking about here is culture, right? Or at least a way of thinking, conflicting industries, conflicting incentives. Another kind of cultural point that I'm curious about, more more kind of broad scope here, is specifically about the transition in uh the UK. So, you've you know, you're from the UK, you know, you've you've

seen a lot you you've seen a lot of change it and I have couple mates that have been, you know, from there, living there, have recently moved back to the States or vice versa. And I can't help but hear and consistently hear about this um kind of uh bucket of crabs mentality that they say that their peers in the early careers have uh where in the past it was much more of um a go and get the job done at at all means capitalistic kind of trying to help each other win. But from what I hear from my peers now, they're saying that it's a lot more of a crabs in a bucket mentality. How do you how do you how do you respond to that? How I'm not trying to poke the bear here, but like how has the the career culture changed

in the UK? Yeah, I'm not wanting to make this a political >> or discussion for for the listeners. >> I asked, right? So, Well, and and there's there's the divide of right and left and we are we are a democracy um and we have seen over time swings perhaps further from the capitalist view, which is sits on the right of the political spectrum, more into the left and sort of socialism view. And the UK has sort of for the last few decades threaded a pretty good um needle line for balancing being one part socialist and supporting the less halves, but also having that capitalist view which generally is net good for the economy and growth. But at the moment, um I

agree with your peers that balance is moved away from perhaps if you're believing free markets and you believe in capitalism as you know, the best the best form of democracy, perhaps moved away from that. So, I would hope over time we get back on course um and we can grow our economy cuz our growth numbers aren't aren't great um but it remains to be seen. I will do my little bit to help steer us in the right direction in this industry. And this has been a transition that's been happening all over the world. The The policies in general were, you know, more globalist in nature even just 5 years ago. Everyone was sort of helping one another even if it was, you know, capitalistic. Everyone was out for their self-interest. It feels like now, you know, countries are sort of these

crabs in a bucket, you know, we're we're, you know, reshoring a lot of things here in in the US uh and and it seems like there's a lot more of those policies that are taking place all over the world. And so, I'm curious, you know, when you when you see a lot more of, you know, crypto companies and more of these digital finance companies maybe returning to the US, you know, they're kind of dissolving this labs foundation dichotomy that was happening for so long, you know, how how do you react to friendlier regulation in in the US, for example? Does it kind of accelerate or motivate uh the UK in general and just as an example, but for other countries, too, to say, "Hey, we have to go out. We have to make friendlier policies so that we

can, you know, recoup some of these companies and, you know, they don't get swallowed up by whoever has the friendliest regulation at large." And so, I guess in in general here, you know, with Clarity Act coming, the US seemingly more friendly in regulation, how will the the UK react to get some of those entrepreneurs, you know, to the UK and and make sure to foster, you know, business uh in in the UK and and and generally? Yeah, I'll I'll I'll pick out three the three ways to answer this question. Firstly, a data point is after the UK announced it was going to be a crypto innovation hub and that was CryptoUK getting that language into the government's manifesto, that really drove interest in the UK. Um and at that

time, the US was perhaps a place where US startups weren't sure whether they should launch a product and service there because they could be taken to court for violated securities fraud. You mentioned that yourself. Um enforcement by um not rule making, but by um the SEC and others. Yeah. And so, I would speak a lot to our Department of Trade, um which is there to bring investment into the UK for US businesses that wanted to know what was going on in the UK. I would take a call a week for a couple of years. Now, those calls aren't coming in. The opposite is happening. Ian, what's going on across the pond in the US? What's happening with these two pieces of primary legislation that are going through? How do I set up in the UK

uh US? How do I, you know, get on shore? And so, we've seen a complete 360, and that's, in my personal view, net good for the overall industry. The US is the biggest market in the world, has great innovation, has loads of people that do really unique stuff and priority work in the crypto sector to grow the overall pie for the rest of the world. I see that as a positive. And the work we do, the little work we do at CryptoUK, is to support our members and the community in the UK, whichever stakeholder it may be, private, public sector, to understand those things that happen in the US so they can join in to the growth of this pie. Yeah.

Yeah. Ian Taylor, I hope you have a great rest of your conference. Thanks for spending some time with us. CEO, board advisor, HC Digital, bringing crypto into the UK here in Bermuda. Thanks for your time. Thanks for being a part of it. Thank you very much for having me. Absolutely. Guys, we're going to pass you to the panels downstairs. There's an awesome panel going on right now. There are three lovely gentlemen wearing suits. That is the state of the digital assets industry today. We're going to pass you there and get our next guest. Thanks to Ian. Let's give him some love, guys. We'll be right back. invisible forever. And not just today. So, your your account will be docs. Your behavior will be docs. The alpha you create from investment opportunities will get discovered and somebody will try start copy thing that, mimicking that, or

front running you, or hedging against that. So, we believe the solution is not private permission networks where you are siloed because you don't need blockchain for those. They exist today. They're banks. They They sit behind centralized servers and firewalls. We believe the solution is bringing Web 3 closer to Web 2, getting to Web 2.5. And Midnight is a permissionless but private network. What do I mean by that? It means that partners like Monument Bank who are looking for safe, secure, private networks can come without our permission and build their private domain and their solutions for their clients. So, the first stage and I think Wasim was a bit humble that they're the fastest growing bank in the UK. Their technology is that advanced

that they can onboard both individual and corporate clients within half an hour using AI, cloud computing, and other things. So, they're not stuck with legacy banking. The The what they're about to do with Midnight is put their client assets, cash deposits on a permissionless public network but in a private way. Approved by the Bank of England and the PRA, the regulators in the UK. And from that, as stage two evolves, is to as we bring tokenized assets into this private domain, it's for them to make that available to their clients. So, we talk about tokenization, it's about democratization, fractionalization. The real value is collateralization, the third ation.

Because then you can bring in hedge fund assets, private equity assets, and you can actually look through to them. I used to work for a hedge fund. Trying to get leverage on a hedge fund unit is hard. Get leverage on the underlying portfolio is super easy. So, if you can prove what the underlying asset is behind the stable coin, proof of asset, proof of collateral, proof reserve, proof that you're trading with a certain uh investment guidelines covenants, then imagine how much access that gives you to better leverage, better finance, better opportunities. So, that's what Monument Bank are trying to do with their clients in a permission way, but that they control. We don't control, but in a permissions network.

So, remove silos. It allows a network to occur, because relations don't happen bilaterally. This is involving a third-party digital asset custodian, who are regulated in the relevant jurisdictions. It brings in tokenization platforms, who now have a distribution channel, because tokenization does not have a supply problem or technology problem. Where do you distribute to? Once the retail crypto fanboys and curious have gone, where is the institutional audience coming from that want to adopt this? Where the bigger clients coming from or the mass affluent? So, you need to create an opportunity where they can do it So, what's what's the uptake beyond I mean your partnership is um clearly uh flying at the moment at a early stage, will be it. Um but, what's

the uptake across the industry? Are you seeing others uh following this example, um or is this uh something of an experiment still? Uh I think different institutions are experimenting with different blockchains. Uh the benefit we've had since the Monument announcement is that other banks have come and spoken to the foundation. They are asking whether they build or they buy. Now, the nice thing about the Monument solution is is not one and done. They have separated their technology service for for themselves as a client, but also can offer it to third-party banks. So, it's block banking as a service or crypto as service. So, there are interests in that coming. I can't speak for what's happening on other chains, but I would I would I would

>> Hugo, maybe you can speak to what's happening on >> about what's happening on um perhaps on on Ireland because there are a couple of things you said here and actually I I wanted to to to pick you up on a couple of things. So actually the one of the first stable coins was the Bermuda dollar. The Bermuda dollar was fully backed by US dollars held in custody for longer than a number of the innovations that you said there. And and the other thing is like we we're talking about a UK bank where there's where there's fast growth and fast onboarding. Everybody's got to get there. So we we we have an onboarding journey that we think is is as fast as that. 20 minutes for individuals, half an hour for the data upload for for for for corporates on Ireland and elsewhere. Now

I really I really agreed with the point that you made a moment ago talking about the privacy and security. It's like what is the purpose of of of of banks when payments can move straight through when when you know, stable coins can you know, are an alternative place to maybe store value. You know, you get back to the fundamental principles and safety and security is absolutely one of them. There are payments, there's yield generation, there's collateral, everything that you've just said. But the a ledger is how a bank has worked for time immemorial. So so integrating with the digital solutions that are there are absolutely essential.

But the every time you have to come back to and I think it's a principle for everybody here is what is the fundamental use case for a user, a business, an individual and and you know, banking is is there is a big change coming. There are like rent seeking behaviors that are under threat. There is a a lot of change is happening. But but a highly regulated institution that where where the security of people's money is absolutely paramount and and that will stay. I agree. So So, Rob, with all these use cases flying around, is there any FOMO out there? And is there any risk around that?

How important is compliance in this? Um yeah, I It's a good question. I would say, look, I've I've been in the space since 2017, banking in the space since 2017. So, that's fine. Nice job. Um and and we've seen a lot of FOMO over different things that have come about, innovations that have come about. Um you know, we're we're cautiously optimistic about the innovation that's coming about now. I think there are still some challenges. You know, I heard you mention um you know, third party, you mentioned you know, network.

You know, at the end of the day, we we we're hearing that buzzword of network coming out from every corner. A network is a group of people who trust one another. At the end of the day, it's trust. If we can't trust the moment at the end of position All right, guys, we are back here at the Digital Finance Forum, day one in Bermuda. We're sitting next to Jeff Bandman, a former senior US CFTC official, as well as a six-time Jeopardy champion. I used to watch that show. I was lucky to get about two questions right per show at the age of about 13 to 14. Um I'm not I'm not sure if there was ever a kids version, but uh

I would have been I would have been winning in that version. Jeff, welcome to the show. Welcome to Bermuda. How's your trip been? Great. Great guys, thanks so much for having me. You know, it's great to be in here in here in Bermuda. Um especially the government here has been one of the leaders in you know, since 2018 in the digital asset space. This is only my second trip to the island, and this is the first time I've experienced sunshine. It's been really uh beautiful, and this is a a great great event to be here for. A lot of a lot of really interesting people who are doers and builders. So, that's been fantastic. >> Definitely. Incredible. Well, you are currently leading the regulatory strategy for Kalshi, one of the world's largest prediction markets. You have a extensive background. You kind of your claim to fame here is you got Kalshi

regulated in 2019, I think is is the exact year. Just maybe just walk us through a bit about your career. It's it's quite extensive. Um how did you find yourself in the role uh at Kalshi? What were you doing previously, as I mentioned, and um why now? Sure. Sure. And I I should clarify, I'm not leading Kalshi regulatory strategy today, but yeah, you know, in the kind of in the early years when we were battling the the CFTC and wrangling them to try to get them get get them regulated. Um so, uh yeah, and that start process started I started working with the founders in in January of 2019, and so we'll talk about that journey a little bit, but it it really is uh amazing. The the vision that is being implemented right now is is exactly the the same vision that the

the founders talked about, you know, eight eight years ago. So, it's pretty pretty remarkable. Um so, you know, in terms of my background and kind of what what got me there um you know, I I'd say I was a kind of a markets guy. I started my career as a lawyer, uh first a corporate lawyer, then a general counsel, uh during kind of what I would say kind of an earlier wave of fintech, but before people had the term fintech. Um worked on kind of some of the transition from voice to electronic trading, uh and you know, saw how these new business models were really exciting to work on and to build, and at the same time were very threatening to incumbents. So, we're seeing that play out. We're seeing that play out with,

you know, Clarity and and Genius and and and these uh models. So, I worked on the legal side, uh then I had the opportunity to switch to a business job uh with my first business job is actually working at Cantor Fitzgerald after the 9/11 tragedy. I'd been interviewing for a strategy job and and and then uh after, you know, after the events, uh they they they brought me in and uh the uh person I'd been interviewing with uh who fortunately survived said said, "Jeff, uh you're a smart guy. Do you think you could figure out how to run a market data business?" So, I sort of had the hands-on experience of of running a a a market data business. Uh I made a lot of mistakes. You know, it was a high-pressure environment. Uh Howard

Lutnick, who's now the Secretary of Commerce, is very demanding and obviously was a very in in intense intense thing, but an opportunity to to learn. I'd say an early mistake I made was uh not focusing enough on revenues and thinking about uh intellectual property. And now I realize you need you needed to learn both. I spent a number of years in in New York and London working on different types of uh market structure uh initiatives and in data trading and clearing and swaps and futures. And then in 2014, I got the opportunity to do public service as a regulator at the CFTC.

And at the time, I have to say nobody knew what the CFTC was in New York or in Washington. If I told people I worked at the CFTC, they'd be like, "The FTC? This this" And it was it was very very difficult uh uh to to explain, you know, what my >> this? Uh so so I started helping, you know, first first Chairman Tim Massad uh prepare for confirmation in 2013. And I went to work there in in 2014. And my my kind of what I expected to be working on and and Tim kind of rug me a little bit, though.

Uh you know, it worked out. Uh the CFTC was having a lot of trouble making sense of data about the swaps market. And regulators get a lot of data, but you know, they you know, how how can they make sense of it? And and then, of course, if something bad happens, the regulators get yelled at if they had the data, but they, you know, they they didn't do anything with it. So, you know, it was originally I thought it was come to Washington for 3 months and help us straighten this out. And then maybe a few weeks before it became official, it's like, "Well, Jeff, it really needs to be for a year." and you know, for for many years I was one of those people who thought, you know, New York is the center of the universe.

I I can't be away for more than a few minutes cuz, you know, who knows, I'll I'll miss something important. But anyway, I I went went to Washington and work worked on on on on data and trading and clearing and international. And then then the way I kind of got into the these crypto and innovative markets. Uh in 2014, a market called PredictIt was trying to get a no action letter. Um you know, the the only thing that really had happened uh in in that space, not a lot had happened uh in in the '90s, Iowa Electronic Market had gotten a no action letter. And PredictIt came along and said, "Well, you know, in the in the past 20 years like the internet was invented and we want to try to expand this a bit." So, I I I worked on

that. And then also I I I didn't know a lot about Bitcoin or crypto in in 2014, but as it turned out I I knew more than pretty much anybody else at the CFTC. So, you know, after the chairman testified to Congress that we thought Bitcoin is a commodity and therefore of interest to the Commodity Futures Trading Commission, um I started up a task force and a study group and and started spending, you know, more time looking at at that. And and my day job became oversight of market infrastructure, especially uh clearing houses, which are a big part of of that, you know, clearing houses like CME and ICE and and London Clearinghouse, where

I previously worked. Uh it's an interesting experience in life when you get to regulate your former colleagues. I I believe I did it fairly and and hopefully they would they would agree with that. But the the blockchain and digital asset work with was taking more and more of my time and getting more and more interesting and also what would happen in 2015 and 2016, you know, the SEC and the Treasury and the Bank of England and the FCA and and you know, regulators around the world would call up and they'd be like, "Jeff, what are you seeing?" And I'd be asking them what they were seeing and we were all kind of just trying to figure it out together.

Uh and you know, it was was more and more interesting. Um uh Chairman uh Chris Giancarlo, Crypto Dad, uh came in at at his request. Uh he asked me to uh take well, the work we were already doing, but to build it out more formally into an innovation hub and it was one of the most exciting experiences of of my life. Uh you know, Chris Chris said, "Jeff, uh you know, you're you're uh I I want you to build an an innovation hub here at the CFTC, uh but I don't want to call it a sandbox. In a sandbox, people, you know, you know, it's it's just soft. Nothing can happen. I want to call it a lab cuz people can can uh can get hurt in a lab.

And you know, you're old enough to remember LabCFTC, which I was. That was a fintech initiative of the late late '90s, early 2000s. It's like we're going to call it LabCFTC." I'm like, "Oh, that's a great name, sir." "Great. Now, your job is to tell me what's in it and what it's going to do." Yeah. So so so we launched LabCFTC and and and got that off the ground and then, you know, a few months later the CFTC started regulating uh crypto futures, you know, Chris became Crypto Dad and then then later Hester Peirce became Crypto Mom. Uh but you know, a lot of the research that we had done, the CFTC was ready to regulate the product because we had spent three or four years studying it, so building up the knowledge before before we put a

regulatory framework. And and you know, we'd done our our homework. Yeah. Yeah. Well, you were long ahead of your time. Uh you know, even in 2025 and 26, right? We've got a much more thoughtful approach to digital assets and they've they've aligned with your uh you know, your CFTC opinion at the time, uh which was that you know, Bitcoin is a commodity. There's more coins that are commodity. Things generally aren't securities. Um and so, you know, your time at the CFTC sort of paved the way for a lot of the regulation that's happening now cross uh cross agency. Uh and we're seeing a lot more collaboration amongst those agencies. I'm I'm curious if you see, you know, any initial uh leadings.

Uh you mentioned that you know, there was a sandbox that you were or excuse me, a lab that you were, you know, uh in charge of creating. Uh we're here in Bermuda. There's a lot of innovation that's happening. I'm curious on the regulatory front, you know, given your past experience, where do you see the most potential for innovation? Uh what are some of the, you know, regulatory efforts that you think are most exciting nowadays? And and how do you think we can ultimately bring those about? Yeah. So, well, first of all, um you know, let's start with talking about Bermuda. Bermuda Monetary Authority is a you know, wonderful regulator, you know, world world-class, respected, conscientious. You know, I I think uh you know, regulators are responsible for balancing multiple missions. They obviously need to protect the investors

or or consumers in in their jurisdiction. Uh you know, they they um they need to be able to balance these missions. Um you know, with the CFTC in the statute, uh it actually contains the words and it's part of the statutory mandate, responsible innovation. And you know, I I feel that in that area, you know, I've dedicated my career to promoting responsible innovation and I think that the strongest regulators are the ones that strike their balance. They they you know, they listen to the registrants. They get the feedback. Uh they still have to be strict because they have to protect people and there there's a lot at stake. And so, you know, Bermuda has has prepared itself to do that. Um I think, you know,

regulators need to be adequately resourced and correctly resourced. Like, there's obviously the opportunity now for regulators to use uh supervisory technology. So, the regulator of the future, you know, is has has a lot of these tools at their um at their disposal. Um and my experience with Kaoshi was was very, you know, interesting. And I think it it's it's a real reflection of of of this. So, you know, in in in 2019, in January 2019, I first met the Kaoshi founders, Tariq and and Luana.

And um what what I Well, what I subsequently found out, they didn't tell me this at the time, was that um you know, they were in Y Combinator, they had developed this idea while they were at MIT. They have this background, you know, these overachievers uh you know, uh you know, Tariq was on the Lebanese ski team, you know, Luana was a professional ballerina, and you know, went through very very strenuous. And then they were, you know, kind of kind of math and data overachievers at at at at MIT. So, they had developed this idea for this this market, and they were beginning Y Combinator, and they realized they needed to be regulated. So, they did their homework, and they they compiled a list of 65 law firms, uh you know, ex-legal experts, regulatory experts.

And all 65 of them said, "No." They turned them down. They said, "This is impossible. They they can't do it." And then they found me. Um and, you know, I think it was from through some Brazilian connection to a law firm that I'd partnered with on something else. And um you know, so so I met them and and I I certainly never told them it would be easy. I said, "This is going to be difficult. It's going to drive you absolutely crazy. It's going to be a long road." And, you know, for people who are you know, kind of fast, overachievers, hard workers, especially with a kind of a West Coast tech mentality from from Y Combinator, you know, kind of West Coast tech time and regulator time are very, very different. But but their vision

from from day one was to do it the right way and the regulated way. And and so what we, you know, engaged in a program of educating the regulator, uh what I call creative compliance, which is to figure out uh you know, how to do this, uh you know, a a a set of activities which is very clearly, you know, in the CFTC's remit, you know, that right now there's a lot of, you know, litigation and dispute and discussion about, you know, what is is what what the law provides, but it's it's a very clear legal doctrine. If we have time, we can do a deeper dive or or another time for your, you know, for your for for for your viewers. But, you know, it was incredible. So, in in in the first meeting, I explained to them,

you know, CFTC vocabulary, you know, what is an exchange in in CFTC speak, it's a DCM or des- designated contract market. And if you have an exchange, it needs to clear through this thing called a clearinghouse, you know, uh you know, which is you know, a D- a DCO, and I kind of explained the regulatory stack. And they're like, "Oh, can how can we learn more about this?" And these, you know, non-lawyers, you know, pre- ChatGPT, I I said, "Okay, here's the statute and here's the regulations." Uh so, that was on a Thursday. On Monday, they send me a 20-page memo that they have written themselves going through every single one of like what are called the core principles saying, "Okay, this is how we're going to comply

with this. This is how we think we'll comply with this. We don't think we know what this means, but this is what we think it means, you know." And and, you know, literally, you know, you know, so I I I was clearly dealing with, you know, extraordinary people. And and frankly, the more I tried to discourage them, the more determined uh they they uh they became. But, uh it wasn't an easy journey. Um you know, we spent probably 9 or 10 months just interacting and getting feedback from the regulator and the staff before we even filed the the application. Uh that took a lot of patience. Uh you know, that that also took, you know, a lot a lot of trust.

They had a lot of trust in me. And I said, "Look, be patient. You know, the first few meetings, I'm the one who's going to go in there. I have the relationships. If I misunderstood something, they can blame me and not you. So, by the time we put you in front of the regulators, you've kind of internalized." And and, you know, they've they've been incredible about, you know, absorbing and and and learning, you know, from from everywhere. I mean, they're they're incredible learners. Yeah. >> Yeah. How do you How do you think about the current structure of the reg- all the all the regulatory side of prediction markets, given your experience? I think the biggest issue right now is the insider trading conversation. What is your What is your current viewpoint on reg- on the on the

reg- regulatory practices of prediction markets? Yeah. So, so, you know, I I I think I think you have a a a situation um where um you know, you you have you know, one set of regulated entities and and Kalshi has, you know, very very high market share in the regulated market. And, you know, then you have these kind of offshore unregulated markets. Obviously, you know, Polymarket is is the is the best known. Um and and, you know, it it's like, you know, I think for I'll give you kind of an an analogy that that that some people can can relate to. It's like you have kind of the big brother who sort of or or, you know, older sibling who, you know, works hard and gets good grades

and, you know, go to school and does does things. and then you have kind of the the younger sibling who's like a bit of a rascal and, you know, knocks over the toys and and, you know, and and and somehow, you know, when when they when they do something wrong, it somehow reflects on the older brother because you're the one who was supposed to know better. Um, you know, so I you know, I think a lot of what's happening and and I hear this, you know, all all over the world because I, you know, I talk to regulators and investors and other exchanges in, you know, in Asia and the the Middle the Middle East and and around the world, and and they say, you know, what's what's going on with this insider trading? And the reason there's so much of, you know, that what's called

this insider trading is that on on a DeFi market, uh, and and I'm believer in in DeFi markets for for certain things, but in a in a in a DeFi market, uh, you know, you don't know who the market participants are. Whereas in a US regulated market, you know, Kalshi knows who every single user of the market is. So, if you, you know, if one of you goes on the market, uh, and, you know, then you suddenly, you know, you buy a lot of some contract, you sell a lot of some contract, you know, that is the kind of behavior that shows up in, you know, very standard market surveillance software. So, you know, this surveillance program detects patterns and anomalies. On a DeFi exchange, you don't know who

those participants are. And so, you know, what happens is all of these events occur kind of on the the offshore unregulated exchange, and then the reputational damage come comes back and damages the, you know, the the the regulated, uh, exchange. And and, you know, it's like having a black sheep in your family, but the black sheep in your family, you know, and some people are like, "Oh, this is great, you know, they're the renegade. They're they're the future." Um, but, you know, you know, ultimately, uh, you know, I think for people to use markets, especially new but you know, they want to trust that they're participating in a fair market. And, you know, something that you know, Kalshi has found through its research is a lot

of the users of these markets actually they they trust them more than they trust sort of, you know, financial stock or, you know, option markets and not to be neg- negative about those, but they feel like in those other markets, you know, they they don't have a chance competing against the the big names. Whereas, in these prediction markets, there's so many topics and it's an area where if you have knowledge or you do research, you know, you actually can get an edge, but your edge isn't that there's just this, you know, kind of boys club or incumbents club that you have no way of getting access to. You know, you you actually can get a reward for for the hard work.

So, you know, I I think it's important to to crack down on it, but you know, it becomes a political >> talking point, also. >> Yeah. And in in a more nuanced fashion, right? The issue is around having certain groups having access to understandings of what a potential outcome of a given event could be in an asymmetric fashion compared to others, right? If you work at the MLB stadium where there's going to be a game that day and you know that because you talked to the manager who manages the team's health, you know that Alex Rodriguez isn't playing. So, you know that maybe you're going to take the under on the on the hits for a certain team.

Etcetera etcetera. >> Or you were there for the national anthem rehearsal, so you know it's going to come in under 3 minutes. Yeah, sure. And so, how do you how do you And so, in markets generally, all participants are typically trying to seek asymmetric information to be to be able to provide them upside to create a thesis, whether it's you're early to something or you've given privileged information, whatever it is. But in these nuanced kind of like event outcome based markets, it's quite different than just like I'm going to buy this stock and try to, you know, hold it and then sell it in the future. It's It's quite of a different typically a more a more It's It's a binary outcome and it's and it's quick It's quite a bit quicker. How do you How do you think about the nuanced answer to whether a manager of a

team, somebody who was at the rehearsal, how do you how do you draw the line here? Yeah, I I think I think it's um it's it's a very good question. I think that that that that is a subtle question and and in fact, you know, kind of the the the term in insider trading and and the concept of insider trading has does have a slightly different meaning in the in the futures and you know, commodity derivatives market. So so for example, um if if you're a farmer and you know that the crops are great this year or you know, the crops are not good this year or you know, you know that, you know, a very important granary

or, you know, a a shipping conduit for grain somewhere in the Midwest is going to be shut down or there's you know, that that's considered, okay, you just have information about the market and and then that actual that sends a very valuable price signal to the market. Um so, you know, so so that kind of conduct has actually been I I'd say, you know, it's it's legit utilization of of knowledge and and research. Um you know, I think one thing that's very important is transparency and you know, my my understanding and I'm, you know, past past the point of where, you know, at once upon a time like, you know, four or five years ago, you know, I I looked more at day-to-day involved, looked at the the wording of

like every single contract to make sure these things were were explained. But, you know, in fact, it is it is explained to the the the users. But, you know, there's clear rules that it, you know, if you're a worker on a campaign, you're not allowed to, you know, enter into a contract based on the the prospects of of of of those candidates. But, you know, it it there there are types of knowledge or research that that actually these markets provide an incentive to do it. And you know, there these concepts that were, you know, academic uh at one point these concepts of super forecasters. And and you know, part of the personality of a super forecaster is that they they actually their opinion

can be changed by new information. And you know, they also you know, have an idea of a mental model or sometimes a spreadsheet model of, "Oh, I need to look at this and this." So, and and you know, the the participation of of those participants actually um you know, the the purpose of these markets and the reason that they're considered to be in the national interest is is not just for trading, but for the price signals that they send. And as a a source of of of truth. And and and so, you know, maintaining the integrity of those those models, um you know, achieve source of truth. And and something you know, people sometimes

don't don't realize about how protection of market integrity works. And and I actually learned a lot about this uh when I went to the CFTC. And it was really cool because they had a room that basically looked like Minority Report with, you know, all these different screens that showed what was going on in in a lot of different markets. But, I you know, I used to think that protection of market fairness was purely preventive. That that But, you know, some of it is kind of detection and deterrence after after the fact. But, knowing that people are watching, but you know, something that is really critical to that is, you know, the operator of the exchange knows who all of the you know, participants in the

market are. So, you know, maybe you did the trade Tuesday and you got paid out Wednesday, but on Thursday you know, we're like, oh, wait a second. This was really unusual behavior. Uh and so there there's you know, some some of it happens after the fact and the fact that it happens after the fact is still part of the deterrent and that's a widely accepted and very important part of a market integrity uh market integrity program. Yeah. And and you know, I I think it is actually very helpful that there's a lot more conversation about this because you know, it it it helps people people know and you know, something and and and this this is something that you know, it it took a lot of work and iteration, you

know, with the CFTC about like you know, most you know, most exchanges in derivatives, they've been trading kind of the same contract, you know, year after year and they might list a lot of new contracts, but maybe you know, there's just a few new contracts or new new contracts that gain traction or add, you know, liquidity. So, you know, CME might list, you know, hundreds or more new contracts, but you know, I don't know, maybe they get like three successful new contracts every five years or something and I I'm making up that number, but I mean, you know, they had the Bitcoin contract and then they did the mini and you know, but whereas on an event contract, there's events all the time and some are

recurring like, you know, kind of Fed funds interest rates, economic indicators, but others are new like you know, when that ship got stuck in the Suez Canal. Yeah. Yeah. And then you're like, well, when is the ship going to get out and what are the implica and it has lots of economic you know, implications. It's also kind of an interesting thing and it captures everybody's attention, but this is finally a way for people to to trade, you know, base based on those things, but you get a lot more new ad hoc things coming up.

>> is at the at the convergence of markets and pop culture. Um and you've been able to strike very important balance as well, which is uh fair markets and innovation, which I think is is is tricky to do, but we really appreciate you taking the time to uh educate us about it and uh appreciate you fighting the good fight out there. All right. Thanks so much. We'll uh >> Have a great >> time on your panel. Thanks for Great. We appreciate it. Thanks for having me. Good luck out there. Oh, yeah. And thanks, Jeff. Oh, great. Real pleasure. >> Guys, we're going to pan you over to the panels. We've got an awesome panel here live at the Bermuda Digital Finance Forum day one. Then we've got our next guest from the Midnight and the Millennium team. Stay right with us, guys. We'll be right back.

Everyone in this room, no matter what part of tech you're working in, you are at least one layer of that stack. And what does that mean in terms of ecosystem? We're looking at ecosystem growth. What is the ecosystem? I mean, the ecosystem in the end are the end users of the part of the stack that you're servicing. At Alpha Compute, we are hardware, firmware, and software, and also some of the middleware adjacent layers, but we're concentrating on GPU as a service. So, we have different types of ecosystems. We have our ecosystem providers that are in the energy and data center space. We have ecosystem uh that are all of the types of clients that are using GPU as a service. And then we stand up nodes for different types of uh layer ones and other and

other networks like Telegram's Cocoon AI, like the Midnight network. And what we do is we spin up nodes in order for the end users of the ecosystem to be able to use those products. So, ecosystem growth on my side of of this business really means to be able to provide the infrastructure so that people can use the ecosystem in the first place. So, I have a slightly different definition, I think this is the the digital finance uh forum. So, for me the ecosystem is digital finance and then Web3 and blockchain. I think the number has been quoted a few times already this week about 500 million or I think Charles said 560 or 580 million people who have touched blockchain and and crypto in the world out of 8 billion

plus. So, that's like 5 6%. So, if we're talking about the ecosystem, that's the ecosystem like digital finance. Like how do we get the remaining 95% of the world into into the space? >> And where where does the Casper Foundation fit within that stack? >> So, Casper is a layer one blockchain. It's it's a proof-of-stake protocol that was based originally on research that came out of the Ethereum Foundation all the way back in 2015. And we are actually very much tailored towards compliant real-world asset tokenization as well as the as of the emerging machine-to-machine economy. And um yeah, happy to talk more about that, but I think the ecosystem is is getting

everybody to participate in this new world. >> Okay. Nacho? Happy to add. I think there's almost another dimension to the thing of the ecosystem which is the how do you think of the tokenization almost value chain to use some of the tradfi expressions where you can think of it from the issuance so where you create the product, you create the product on chain. The trading, the distribution of that where you have the centralized exchanges, decentralized. You have then the called post-trade, the custody in particular of the assets. Then you have all the services behind whether it's data, whether it's governance on some of these assets. And so, I think that's a bit of the let's say the end-to-end value chain that supports the digital finance ecosystem so that one level below where Ondo is on that is we issue products on

chain. So, we bring treasuries and stocks and ETF on chain. We're the largest issuer of tokenized equities. We have about 70% market share globally. Um we then distribute them via a network of partners. These can be on the on-chain space, so partners like Binance, OKX, Bitget, etc. that are venues for the 560 or 600 million users on-chain to access. We have our our own venues as well. Um and then we partner with the rest of the ecosystem. So, we partner, for example, with Broadridge to bring governance to those tokenized equities. Uh we were the first partner with, for example, with uh Franklin Templeton to bring ETFs um on-chain. Um so, we partner on the rest of the of the the value chain, and we focus on really the issuance and distribution. Okay, Patrick. So, we're even a little bit

more narrow than that. Uh we run a a digital asset treasury focused on BNB. Uh and BNB is really the fuel that runs the Binance ecosystem. Binance does 40% of global trading volume every day. Uh the BNB chain has 58 million monthly active users. And BNB Plus, we're really focused on generating yield uh in that ecosystem through a variety All right, we are back live from the Digital Finance Forum here in Bermuda. We've got our next two guests. We've got a double. Uh we've got Fahmi of Midnight and Waseem from uh Monument. And uh it's an absolute pleasure to have you guys on. Welcome to the show. Thank you for having us.

>> Thanks for having us. Absolutely. Uh first time in Bermuda for you guys? Yeah, it's definitely for me first time here. Loving it. First time in in Bermuda. It feels very English, so as a guy from London, it feels very English. So, I think you for bringing the rain with you, Fahmi. Yeah, sorry. Um well, let's get into it, guys. I mean, there's a lot going on. Uh obviously, Midnight and Monument are both uh at the at the spearhead of innovation here. Um I'm curious from both their fronts, you know, why why we have you guys here together? Uh you know, what what is some of the work that Monument and and Midnight are doing together? And then, you know, we'll we'll get in uh broadly.

Yeah, shall I maybe I give you a little bit of context at Mine and because it'll it'll sort of um explain why this is a a great partnership. So, uh Mine and Bank, we're building the financial home for the mass affluent in the UK. We're fully licensed deposit-taking bank, almost a billion dollars in savings, 100,000 clients. We're the fastest-growing bank last year. And the mass affluent turbo term, it's people who effectively don't have enough wealth to be in private banking, but are not served by the high street banks. And so, our really our mission, our vision, is to help people, you know, know where they are today, plan for tomorrow, and grow and protect their wealth in a very seamless way. This is a time for our community, doctors, lawyers, people in financial services.

They're juggling work and family. And so, they they managing their wealth is is not as easy as as one would think. Just because you're affluent doesn't mean that you're actually you have the time to do it. And so, we're really bringing together savings, investments, and lending all in one app. And so, when we think about, you know, what what does an investment proposition really look like? What does a saving proposition really look like? We we want to bring the best products in the most simple way. And often we actually think about what are private banks doing and how it how do we democratize that? And so, we thought the the best way to start is we want to start with a tokenized saving product. The idea here is you're you're

giving three things. One, it's an interest-bearing account. It's fully protected by the FSCS, so 120,000 in the UK per per person, and 240,000 for a family. It's given by a highly regulated, highly governed bank. This is really the foundation for what comes next. Investments, tokenizing investments is something we're we're interested not just not normal funds, you know, what's really important is you think about what are products that private banks have which you know, they that today the mass affluent don't have access to.

>> Right. And so, the best hedge funds, the best private equity funds, if you want to get any into 100,000 or a million, doesn't work. No liquidity. Can't borrow against that money. And so, tokenization really unlocks that. It becomes that access. You can do it for 5, 10k. It becomes about liquidity. Uh and then it becomes about um access, liquidity, and efficiency. Yeah. Uh bringing the cost to serve down so that you can give the product a really good rate. But, you need the right partner because uh banking's about trust, it's about security, and it's about privacy. And this is where Midnight comes in.

>> And I think, yes, this is exactly where Midnight comes in on on the security, the privacy. Uh and so, uh we've got Faheem uh Fa- Faheem. So, tell us a little bit more about uh Midnight uh and how uh you you guys are working here with with Monument on this partnership. >> of all, thank you for having us here today. Uh Midnight is what we call a fourth-generation blockchain. If you think about the evolution of blockchain, blockchain came about as a truth layer. Bitcoin was a truth layer because uh that you can own your own asset, move assets across borders without censorship, without control, central controls because it came about following the financial crisis. And we've seen the evolution of that into Ethereum, the next generation, which was about programmability, using smart contracts, and third-generation Cardano, Polkadot, Solana, and others, all about

scalability. But, what they've all overlooked about mass adoption is privacy. Today, uh we walk around this conference, we will introduce each other by name, where we work, where we live, but nobody discloses their bank account or their bank account details or their net worth. These are private matters for private discussions or for selected disclosures to certain groups. And yet, every blockchain, public blockchain today is permissionless and transparent. And everything you do behind anonymity is will be discovered. You will get docs. AI bots will figure out who you are, and then all your past patterns, behavior, transactions, wealth is fully exposed for everybody to see. Large corporations, large banks won't put their client assets on a public blockchain. So, you have this bifurcation of public versus permissioned private ones. The

permissioned ones become siloed, and then how are they any better than existing centralized solutions? So, Midnight, I think is it comes into the sort of the intersection of Web 3.0, bringing it closer to Web 2.0, which we call Web 2.5. Yeah. Adding a privacy permissionless private network to kind of parts like Monument, where they can come and program their private domain within this permissionless network. They decide who gets to access this, what assets come to come into this network, and essentially create a secure environment that they can create compliance and rules around to operate within. The nice thing about that is that after other similar banks do that, they're all operating within a similar network. Mhm. And they can find ways to permission access between each other, or

privately move assets around from each other. That's the long-term aim, but it's not just about finance. It all works in supply chain. We have forensic evidence going through the Midnight network. We also have healthcare data being used for interclinical trials. So, this is about protecting the clients' assets by creating an ecosystem of which is fair and open, but it gives people control around what they do with them. And this is all very sensitive data healthcare forensics money all of this very very it's necessary that we have privacy at the core of these pieces of infrastructure.

Open question to both of you guys. I'm curious, you know, how composability could work here, and and composability maybe not so much in the technical sense of, know, what we've come to with with DeFi and and these sorts of things, but more so in the sense of you know, how you know, banks and tokenized deposits could work once you're starting to make payments and you're starting to bring more of these modes of finance together under one roof. And then, you know, on the blockchain front, we've heard how important privacy is, you know, blockchains like Canton and you know, Ethereum layer twos they're they're and they're they're are more and more of these talking about privacy because it's so favored by institutions.

And and so I'm curious given the necessary the necessity of privacy, how do you ultimately make sure that you know, you're providing what some of the benefits of tokenization could provide in the sense, you know, you can borrow against some of these things, you get some more liquidity, you get that privacy but you don't give up some of those benefits of tokenization. >> take this first if you like. privacy blockchain in general and then we'll see him talk about why Monument chose Midnight and what the benefits are for him and his clients. So everybody talks about tokenization. So tokenization, we talk about democratization to access fractionalization which again helps with access but the real value of blockchain and the truth layer is collateralization. Can I prove what my underlying portfolio is? Can I

aggregate? If blockchains are fragmented, what Midnight allows and we will have the technology in the coming weeks is a single private vault that can have all your assets across all chains represented in one place and can be controlled from one place. So think about how that what that does for margin lending borrowing leverage opportunities, financing opportunities and access. When it comes to privacy, you can't add privacy as a secondary thought. People are now adding it as a feature release or an update to existing systems. It's like me walking out my front door naked. Once you see me naked and I get dressed in public, it's too late. You can't you can't you can't put it back in the box. So you leave fully clothed and then in a humid environment like Bermuda where we are today, I take my jacket off, I roll up my sleeves, I

give you enough exposure that you're comfortable with and I'm comfortable with. That's selective programmable disclosure and that's what Midnight's ethos is about. You build metadata as well as data protection. Everybody focus on the data but the metadata, who you are and who you're speaking to is just as important as what you're sending and what you're doing. So we protect those layers and through the smart contract allow disclosures, allow identity as a gateway into a transaction or into domain, allow certain assets to be eligible, not eligible, allow you to look through and provide proof of covenant about how your trading activity, your portfolio structure, and everything like that. That is everything that existed in the TradFi world and the hedge fund world that I came from. We're trying to bring that same ethos into what Midnight does. And then, that's how we get to work with wonderful partners

like Monument. And And so, the these universal vaults, it sounds like, you know, tokenized deposits from Monument could serve as collateral in which you you then have this portal to the entire on-chain world. >> Potentially, yes. And And this is where I think it gets really exciting. The, you know, when we Why do we partner with Midnight? Um there's three things. Talked about privacy. Uh then we want to talk about network, number two. But also, um tech philosophy. And And I'll take them in reverse order. So, when we built Mind Bank, we we had a principle, which is we never wanted to become a legacy bank.

Uh we're tech-first company. And so, we we said at the outset, we have to make a decision where we are going to be comfortable with it one day replacing our core bank, one day replacing our CRM, one day replacing our KYC platform. Actually done some of those. Um and where Midnight is great is actually it's very similar philosophy. We're not making bets on any specific chain. It's an It's a infrastructure layer that is private. And And therefore, you know, you're kind of protected for the future. It's not just legacy. And together then, we can build that network effect. We have relationships with private equity partners that we can bring into the network. They have relationships with various hedge funds. And so, then we can curate um different products. We don't want

many. That's the important thing. So, for for our client base in particular, it's about that curation. What are the two, three, four uh products that really make a difference to somebody's goal who's trying to grow their wealth, protect their wealth. Um but But the savings is really that that foundation because you you kind of gone in there, and then it becomes the segue uh to to everything else. So, we're delighted to be really the first people who are doing tokenized uh deposit, bringing it to to retail. Yeah. And what does bringing it to retail look like? Is it, you know, making this front and center so that they're the the bank depositors are starting to make some changes in terms of how they they work with these products? Is it just a higher yield rate? Everything else is is abstracted?

>> Yeah, so look, we we often say like the best technology is actually invisible, right? And so it really needs to feel seamless. It needs to feel familiar. So I often say modern rails, familiar app. So many ways the journey looks really the same and we provide good yield. So we're going to continue to provide good yield. We're going to do a fixed term product uh where where people, you know, get get access. But may you we start the education journey. What is the token? It's not a crypto, right? And and the most important argument to make and the most important educational element is actually not a crypto asset. Mhm. It's simply different infrastruct infrastructure. It's a modern rail that's allowing that access and and really taking fiat deposits and making

into programmable money. >> And and this is something our industry has overcome as a collective is this industry is not about crypto, right? And the and the and the meme coins, cryptocurrencies, all these things. No, there's a bigger thing going on here. We're replacing the entire financial system rails and this is the piece of technology. It shouldn't be as controversial as it is. The reality is that, you know, there's there's protagonist and antagonist when these things are changing. >> Think about the evolution of finance. Initially when shares were issued by companies, they were paper shares. You physically owned the share. You took it home, you put it in your banking safe or your safe in your house or you put in a safe deposit box. Then that evolved to the digital advancements that meant shares are now digitally recorded. So blockchain advancement means those digital digital shares which

are whole shares can now be fractionalized, bought onto rails that have broad tooth bears, allow access points. So again, we think about the fragmentation that's happening in blockchain in the industry, we blockchains are infrastructure layers that should be augmenting existing financial rails. That's why we talk about web 2.5. So, what we can offer, like I say, is a privacy unifying privacy layer within Midnight, all chains, all assets. So, if you are an issuer of a token, it doesn't really matter where you sit. If you sit within Midnight, then it's private. And then you get access distribution. That's been the major issue around tokenization.

It's not supply or technology. We know you can always tokenize everything. So, where's the distribution? And with Monument Bank, you've got a a client a client or a bank servicing mass affluent clients looking for additional access to fractionalized assets that they previously were denied access to. So, we think it's a wonderful opportunity. And and we're happy to support their growth. And it's gaining its acknowledgement of blockchain as mature as an industry. We have a a central bank like the Bank of England, one of the top four central banks in the world, who are, you know, supporting Monument on this journey. And for us to to Wasim's point, we want to be invisible architecture infrastructure. Nobody should be talking about Midnight. Often people want the token to go up for the blockchain as

well. We want transactions and services and networks to be created on Midnight so that there's utilization, use, and therefore Midnight becomes no different to a technology stack. They use cloud services, cloud providers, databases, online and offline. All these different things. And Midnight just becomes a stack that offers their clients access to products. And for their clients, it's a banking app which gives you services and opportunities. They don't almost know it's a token or a blockchain behind those yield assets. Yeah. And and there's no need to. They don't They don't need to know as long as it's safe, secure. >> you know, we don't tell our clients, "Hey, you know, this is a cloud native bank with lots of microservices." And you know, that's that's They care about the outcome. Absolutely.

Uh as do we. Guys, thank you so much for taking the time and congratulations on the partnership here. It feels like uh this is the first of many and and and you know, there's plenty more to come. So, appreciate you taking the time and uh and and helping share things here with us here on the Rollup. Thank you for having us. Yeah. Have a great rest of your week, guys. We'll be right back. We're going to cut you guys over to the panel that's happening downstairs. Don't go anywhere. We'll be right back after this. Now link into the workflows that investors are used to using for their traditional institutional investments today. Um so, how do we think about the users in terms of where they are and meet them where they are, and not just the on-chain users, but the non-on-chain users that are not used to being on-chain in a way

where they are comfortable? Um and then, based on that, what are the actual products use cases that they want versus what are all the things that exist in the world that we can put on chain? And And do you think that the technology, the development of the stack, all the the layers of a of an infrastructure stack, could actually be the solution to some of the friction that we see from regulation? I mean, we talk about privacy, we talk about um identification and other things. Is Is that what you think could be a major development? >> for the first time, at least in the US, we've now got the regulatory framework to actually implement that. Where before it was just so unclear, and it was being done offshore. Now, with the SEC rules, the Clarity Act, the Genius Act, like we've now got a framework we can build

on. >> True. You do need clarity. So So, no pun intended. Regulations are hard to engineer, right? But uh everything else in the stack, um and I guess I'm coming from the perspective of being a CTO, but everything else is an engineering challenge. So, um yeah, we at Casper believe that particularly with the Casper manifest that we announced today, that these are all engineering questions with engineering answers. Um and uh we we know what the issues are. We're talking about them here. Mhm. Um so, we're solving them. Well, I think on one of the panels before this, the one with banking, right? I was talking about just being able to onboard somebody, both corporate and individual, in sort of 20-30 minutes. The technology I'm seeing, as a user, is getting better and better in the existing system. Uh I totally agree.

If it If it can be hidden behind the scenes, you don't know you're using it, then you're going to get mass further adoption. Yeah, I think On that point, like Sorry, go on. merged with Like this is where tokenization, AI, um start blending, where you view a you can use a bunch of AI in the onboarding process and KYC. You can make a lot of that friction disappear. And then if you start thinking about agents and how do you think about investment, robo advisory, creation of portfolios, customization, there's a lot you can do with the technology to your point that is entirely novel and can help address some of the bottlenecks that we've seen historically but may not be in the in the future. Yeah, I think when when you're talking about, you know, the best UI UX for onboarding where everything's everything's invisible in

the back end but you're using blockchain, you're using AI, you're using confidential computing without knowing. Probably the best example is Telegram. How many people here have Telegram on their phone? Yep. How many people are aware that Telegram has a confidential computing AI network in the back end? Yeah, exactly. So, all of the new AI native features that are rolling out in Telegram to over a billion users are using the Cocoon AI network which is on Ton. It's a decentralized AI network that is confidential computing on Intel TDX. So, it's fully encrypted end-to-end down to the hardware and firmware level. So, any of the AI new native features that you're using on Telegram are fully encrypted,

you know, in in a similar way to X to XAI rolling out in X with Grok. That's the same thing that Telegram's doing with Cocoon AI but you don't you don't know that. They don't Telegram doesn't need to tell you that in order to make it easy to use. So, I think having massive onboarding through amazing UI UX which Telegram's definitely one of the best examples of that and fully vertically integrating blockchain into the back end and fully integrating other types of encryption technology is like Intel TDX and decentralized AI is just an amazing opportunity for more than a billion people around the world to be using privacy-centric technologies without asking for it or having to understand it.

Okay. So, let's go fast forward. 2027. we're on the same panel in the same room. Hopefully different weather. But, what do you think is one hot topic that we're going to see in 2026 that we won't be talking about next year? And what one thing do you think we're going to be seeing as a hot topic that we will be and hopefully are on this stage talking about next year? Is your agent running on confidential compute or can anyone prompt it and get all of your data? Is that what we will be talking about or that we hopefully won't be talking about? We'll have solved that by then.

Okay. I'd like to be talking about how agents can participate and drive transactions in a automated independent way. All right, guys. We are back here at the Bermuda Digital Finance Forum day one on the lovely island of Bermuda. We have pristine 4K video footage somehow from an island in the middle of the Atlantic. This is the roll up. We are back with Sandy from Franklin Templeton and a new guest Gurpreet from Kraken Institutional. How are you guys enjoying Bermuda? Welcome to the show, guys.

Great to be here. Thank you. Thanks for having us. How's the island treating you? Any first thoughts? Any Was it what you expected? Beautiful here. Yeah. It's beautiful. Yeah. It's definitely it it feels like an intimate professional setting for kind of this next evolution of digital assets that I feel like the entire industry has firmly realized that we're in and just each conference just kind of further kind of cements that into into into stone and so guys, Franklin Templeton and Kraken are working together on a a variety of new products bringing different assets on chain.

Maybe let's just lay the land here for why Kraken and Franklin Templeton make sense and just kind of understand what this means. Sandy, maybe you can just give us a bit about your your perspective about expanding your asset base on chain. Yeah. So, look, we really have been looking at what is happening in the landscape, looking at who's doing things that we think are smart and creative. And that's really what put Kraken on our radar. And then we met Gurpreet and the team. And we really found like-minded thinkers around really understanding the potential of where the space is going.

Right, we are not looking to recreate the world that exists today in financial services. We realize that these technologies give us the power to redesign that world and make it better. Make it more accessible, make assets work more effectively, give people more financial inclusion and opportunity. And you don't have to be a giant institution to take advantage of these opportunities. But giant institutions, too, should get the benefit of all of these new innovations. And so, we felt like we were very like-minded.

We really look at what they are bringing in terms of a new distribution channel, insights into a new audience and how they're using these products, creativity in how they are building their own business and really building a partner network. And we do believe this is a network-driven business in crypto. So, we were very excited about working with them on this partnership and there's many facets to it and we're starting with things that are here and ready now and today. But this is going to be a partnership that builds over time and brings things that I think are going to be very groundbreaking to the market. Awesome. Yeah. Absolutely. I think first principle for Kraken is we want to serve our clients and we want to

bring the best institutional products to our clients. When we met Sandy and the Franklin team, we realized this is the leading asset manager globally and they're forward-thinking. They've been looking at digital asset space before anybody else. And the concept of products we're building today with X stocks and tokenized yield is something which our clientele actually wants. And I think this is going to be a great partnership for today and the next 20 years. Yeah. And Gurpreet, there's been news of a confidential IPO on Kraken's side of a large fundraising round as well. You know, needless to say the Kraken brand, once a an exchange back in 2017, is now almost like an institutional prime brokerage, right? It's really expanded its product offerings, its lines of business.

How How do you best describe kind of where Kraken's main focus is going forward now, right? With the likes of all these partnerships. What is kind of this broader vision for Kraken as you as you move forward into this institutional era, into this kind of prime brokerage field? Yeah, I mean, I'll speak from the social lens. Kraken Kraken again, if you want to serve our clients and make sure we continuously build and provide the best services and products in the industry. Right? We want to make sure Kraken's a place for people custody their assets, trade their assets, and borrow and lend, right? So, through a full full suite prime service, we have accomplished that. We serve leading banks, leading asset managers today. I mean, frankly, right now, we can offer

like real-time money market yield yielding products with Benji, right? For example, why this is important. I think today, for example, if somebody wants to buy a house or somebody wants to buy put a large investment in a private technology, etc. There's a gap between when the funding is required and when money's in bank account. So, in that gap period, a Benji provides a solution where they can basically earn yield while there's a gap between the funding required. So, so Kraken is an institutional from an institutional perspective, we launched tokenized equities, X stocks, 30 billion traded.

Tokenized credit is the next thing. So, right now we're working on like high liquidity products, equity and credit, and we'll go full through the stack, right? Or we believe in few years, tokenization will be the financial pillar across the world. And and we, with Franklin, are the forefront of that. We're innovating right now and and continuously will keep running products. So, XStocks is live, Franklin Templeton has money market funds that is live and we'll continuously work to build more products. Yeah. Yeah, and I think like the evolution that we're seeing is kind of the we had stable coins obviously proliferate over the last four or five years and we're kind of just moving down the risk curve almost. You you've seen growth of T-bills on chain. Now obviously products

like XStocks bringing equities on chain um and then anything all the way down to like the private credit side of risk. Anything in between it feels like there's kind of like this evolution happening. Sandy, how how is the Franklin Templeton strategy with with with this type of partnership with Kraken? How does this uh evolve and and and how are you seeing this evolution of like here's all the products, ETFs, assets that we have as an asset manager, you know, how are you thinking about bringing those on chain with with partners like Kraken? Yeah. So, I think that the most important thing to differentiate is that there's a difference between the products we deliver and the expertise we possess, right? And so, you know, Franklin Templeton is a $1.74 trillion asset

manager. We have a lot of products and we have a lot of audiences that we serve with those products, but none of them are the crypto native products, right? The assets that we are building up in our Benji suite, the assets that we're going to be capturing and building in conjunction uh with Kraken, this is a new audience. These are all net new dollars into Franklin Templeton and new audiences need products that fit the way that they think about and approach markets. And they need digitally native products, right? You know, this idea that they're going to keep reconciling back to systems that take 24 to 72 hours to actually process a transaction when you can have a transaction processed

within seconds in a digitally native environment, that just doesn't work when you're thinking about what does the future portend. And so, I am really excited about this idea of using their expertise in understanding this audience, our expertise in having all the potential building blocks to put new types of investment products together that can cross public and private, that can cross permissioned and permissionless, right? You need a whole array of products to participate in the ecosystem that's developing, and this is where I think the power of bringing together the crypto native and a traditional firm like Franklin Templeton who also believes in digitally native

offerings is going to be profound, right? It's going to set the bar that the rest of the industry's going to have to follow. I think one of the things, Sandi, is that there's this user base that Franklin Templeton and other asset managers don't have access to, which is this fully on-chain user base, folks like who have, you know, been in the space for a while, who, you know, choose to live their entire financial life on chain. However, the way that we've experienced this is that that is the riskiest part of the portfolio, but it is also all of the portfolio. But, I think that the way that this this transition is happening is that no longer is on chain just going to be the risky, you know, 100x, 10x, you know, very like, you know, aggressive part of portfolio, it's just

the portfolio now. And I think that there's a kind of a a mental shift happening here, guys, where instead of, you know, having to pull your funds off chain to go buy your gold or buy your T-bills or buy your equities, your your your average user's on-chain portfolio will start to look a lot more like a traditional portfolio in in in a brokerage account. And that for the people that really like to be on chain is a massive breakthrough because it is a pain to go off and to go deal with that entire environment, especially if this is what you're used to. How do you guys think about this kind of portfolio construction uh evolution as well, right? I mean, it was just crypto assets. It was it was high yield in DeFi. It was minefields of of smart contracts. It's really evolved

into now being a place where in the on-chain landscape, you can actually have a diversified portfolio across several asset classes. How do you guys think about this evolution of user behavior and how do you kind of cater to that? Yeah, I think the most important thing, and this is really the reason why we chose Kraken, is because the biggest mistake you can make is thinking, "Oh, I'm going to just take the portfolio products that I offer today in a wealth channel or a direct-to-consumer channel and transport them into a tokenized form and offer them on chain." Right? That is not what this audience is looking for, right? This is a more sophisticated investing audience who really understands that every asset they possess is an asset that can have utility beyond just sitting in their wallet. And therefore, it needs to be

digitally native, it needs to be transferable, it needs to be interoperable, and it needs to achieve aims that in many instances fit a risk-reward profile that is far more aggressive than what you would get in traditional wealth channels. And so, the products that we need to develop for this audience, the yield products, the equity products, they need to be products that really speak to that investor's core interest. So, I think this is an all new channel. I call it the direct-to-wallet channel, right? You have direct-to-consumer, I call it direct-to-wallet. And I think that this direct-to-wallet distribution channel is really going to be where innovation happens, uh and where it's going to happen so quickly and the

benefit of the assets that we're going to create for this channel are going to be so superior that you're going to see more and more of the core assets that are in today's traditional system migrate into this direct-to-wallet channel. I have a feeling your wallet is pretty risk on. Yeah, I'm pretty risk on. Yeah, to add to that, I think right now, facts from last year is 300 billion stable coins. Yeah. We believe the few years it hit multi-trillion. Right? All that users in the digital economy need to earn yield. So, we have the crypto native with like, you know, USDC, Athena, etc.

Now, with Benji and a Franklin yield product, we're offering more institutional products that the user can decide which they want. So, as Sandy mentioned, this is this speaks their language. They under- They They're looking at the Benji token at the look at a stable coin like USDC earning yield. So, I think what we're doing Franklin is is really cutting edge because as you know, one thing consumers or users do not want to like, for example, a lot of other companies want to do 10-year lockup tokenized funds. Sure. That's not interesting. No. Like working with Sandy and creating a tokenized yielding product which, you know, yields above money market funds that's 6, 7, 8% with short duration lockups is a very in-demand product.

Right? Because right now, if crypto volatilities is not happening and Bitcoin prices are flat, people want to earn yield in their in their dollars or Bitcoin. Yeah. And finding a a simple institutional branded solution that serves this use case is is really really compelling. So, really excited about this. Yeah. And this is where you need to blend, right? You need to blend public and private credit to really achieve these outcomes in a way that fit the demand of what the audience is looking for. And that is just not something that we are seeing in the traditional markets, right? They still think of these as distinct asset allocations, distinct asset classes, >> Sure. right? And so, it's a new mentality and you need to design for this investor specifically. And they're really blazing where the industry as a

whole is going to go. I have no doubt that more and more the traditional channels are going to start to follow and look increasingly like the channel that Gurpreet and his team are building already in Kraken. Right. Right. Yeah. And there's a user base there, Sandy, that perhaps may never have had a Schwab account or a Franklin Templeton account, but you can still access these consumers and these investors by doing it in this way. And a lot of them have come and have built their wealth through crypto, right? >> what I mean. Like in fact they might have >> to diversify, but they don't want to go to these these channels that have poor consumer experiences, where you're building in all of these delays, where they control your assets, right? This is not that world

>> But they still want yield in the bear market, for example, they they may not want to, you know, go into a stablecoin into into a a DeFi protocol that has, you know, excessive risk. They may just want, you know, stable yield on chain. Yep. And so it's your way to reach this kind of new investor class. Yep. Yeah. And so when you guys are thinking about expanding this, right? This is kind of the early innings of what a Franklin Templeton and Kraken could do. As I mentioned, you know, Kraken potentially going public here this year, more product offerings, more kind of institutional facing offerings. How do you how do you think about expanding uh access to Franklin Templeton's products through Kraken's suite of offerings? What does that expansion plan potentially look like?

Yeah, as Sandy mentioned, I think a lot of people talk, we executed, and we're live. And I think we'll look at tokenized gold from from um from FT. And we'll also as as you see, you know, we we we have the distribution platform. We see what consumers want, right? And we'll work with the Franklin team to ideate and incubate products that serve the consumer. We got the money market yield, we got a high yield product, and tokenized metals through the ETF. And I think what's more most important is cross margin. Right? So making have a Benji earning, say, money market money market yields, can borrow against that, invest in Bitcoin. So what also innovation is, whether it's X stocks owning Franklin ETFs, so if one wants one believes they want

exposure to both equities and Bitcoin, this solution allows that. So like being on Kraken plat Kraken's platform, one can cross margin across all these different asset classes with the same dollar they have. So, I think right now we've achieved cross margining, achieved tokenizing ETFs, uh we've achieved tokenizing money market funds and tokenizing yield, and I think, you know, we will figure out what to do next. Yeah. And now look, we're we're doing an exciting ETF drop here in Bermuda. >> Yeah. Yeah. Yeah. Tell us about it. To the to the um citizens here, and this is a great, I think, opening gambit Yeah.

to put this these assets into people's wallets and let them really start to utilize it. Yeah. I think one of the interesting uh products that could be used here for for a a product like uh like what Franklin Templeton has with Benji is this idea where you have your stable coins in a perp balance or in a trading balance. Um when you're just kind of holding them waiting for your next next trade. If there was a like an auto click or an auto ability to just take those, put those into something like a Benji, get that yield while you're waiting, and that is kind of like your your collateral's earning yield instead of just you know, being a stable coin. And that that would probably be very compelling. 100% as, you know, what what what what what Maybe that that wasn't supposed to be said out here, but

What what crypto and digital asset does is we're offering the yield back to consumer. Sure. Right? And working with Franklin, you know, we're offering, making sure the consumer benefits, and we're democratizing what institutions historically had with either Benji or high-yielding products available to everybody in in Kraken's distribution globally. Yeah. Over 190 plus countries. Yeah. So, you know, as as a core thesis, I think what's next is looking further to the product landscape is private stocks, is commodities, etc. is making sure that we can provide the everyday user in the world access to what only institutional investors can buy today.

Yeah. And just kind of a more kind of broad question here. I think a lot of the tokenization focus has been on let's bring the US equities market or the US product uh line for T-bills for the US dollar, right? A lot into the hands of international investors, and giving them access to US equities markets, to stablecoins, to US dollars. But, the emerging markets are having some of the best performance that they've had in 25 years right now. Um the general kind of index of EEM is is performing extremely well, and I think there's more demand than one would expect for US investors or Western investors to actually invest in more of these kind of like emerging market ETFs or emerging market funds.

Now, you you can have access to those in traditional brokerage, but you again, you run into the same issue of this investor class wants to stay on chain. How how much thought are you guys putting into bringing more of the emerging market asset classes on chain to give investors access to these more esoteric types. Yeah, I mean, this is where Franklin's suite of products is really going to become, I think, instrumental in what we design together. I mean, don't forget with Templeton and the acquisition of Templeton, Franklin is one of the top emerging market asset managers globally. Right? I mean, we we have been in some of these countries that are considered emerging markets for 50 years now.

Right? So, I mean, that the brand outside the US is probably even stronger than inside the US. So, I think this is where we really start to look at how do we engineer the return streams, right? Because crypto is all about the return streams. It doesn't matter what the underlying product is. It's what do I want from a return stream in my portfolio, and how do I I leverage that return stream to get even more, right? And so, I think this is really where our design, our collective design experience, and the experience that Gurpreet and his team, and and Franklin and our team bring from our traditional worlds, where we all grew up, and and translating that into these new

opportunities, right? This is where I think the creativity and the magic happens. Is really it it's the combination of the crypto and the traditional finance. It's not one versus the other. It's how do you use this innovation of these new rails and these new wrappers and these new programmable assets to create something that has never existed before, but using the building blocks that have traditionally driven financial advancement throughout the entire world. Yeah. Gurpreet, anything on your side on the emerging market side? Just close us out. Yeah, I mean, I think what stablecoins have done for the US is is remarkable.

Right? I mean, I think I believe Tether's one of the largest buyers of US Treasuries. Right? And frankly, like while we might see in local currency terms India performing really well, I mean, you look at the Indian rupee's all-time lows. In fact, I I I I counter that. I think the US has probably performed the best. And I'm very long US, but I think with that said, I think we want to provide a suite of products, and we'll work with the Franklin team to have an emerging market ETF. I mean, they already have these products. >> Exactly. So so So, we're going to, like I said, we're just a start. And we're going to go the full product suite one by one.

Right? We can even have, you know, we'll work with Franklin's team to ideate what, you know, what emerging market country's performing the best in equities, and how we can provide that, you know, same investment profile to our users. So, as as Sandy mentioned, it's early days, but, you know, we're the technology's there, and the partnership is there, and we'll execute step by step. Yeah, amazing. Sandy, Gurpreet, thank you for your time. Enjoy your time here in Bermuda. It's a lovely island. It's a great conference. I hope you guys have a great week, and congrats on the partnership. Great. Thanks for having us on. That is Sandy from Franklin Templeton and Gurpreet from Kraken Institutional. We are live here at the Bermuda Finance Day 1 here on the island of Bermuda. We're going to pass you guys to the panels down in the main stage,

and be back with our next guest. Traditional gambling is actually wildly extractive. Right? Sports book vigs are large, and they're increasing. Casinos take fat cuts wherever they can and even things like contract for difference brokers in the EU internalize trades against their users. We're focused on investing in venues that reduce these take rates and all of this specula speculative activity including P2P betting exchanges like Novig and Triumph for real money gaming. Our third or I'm sorry, our sixth theme here is programmable coordination. The TLDR here is that tokens when designed well are actually superpowers which I know is crazy to say these days.

Um the first concept here is DePIN and Multicoin was actually pretty helpful in pioneering this category. Our investment in Helium back in 2019 was probably one of the first institutional bets on DePIN. Uh our thesis at the time was pretty simple. Instead of one company raising billions of dollars to deploy hardware, you could use tokens to incentivize anyone anywhere to install hardware and earn some ownership in the early days. Since that time we've backed some other DePINs like Hivemapper which is building a decentralized map using dashcams and Geonet which is building a decentralized GNSS network uh incentivized by tokens.

Across all of these DePINs though, I think the pattern is pretty consistent and it's clear. Tokens align incentives, infrastructure gets built faster and cheaper than any single company can manage, and early contributors can capture real ownership and upside in the protocols that they contribute to. Theme seven is incredibly neutral blockchains. Um this one's actually pretty simple but I really think it's under appreciated. Our view is that finance companies don't want to build on competitors' platforms. So E-Trade is not going to want to build on Robinhood chain and Addy in in our view is not going to feel great about settling on Stripe's Tempo chain.

And actually if you think about it, TradFi learned this decades ago. Uh stocks clear at DTCC and not at individual exchanges. Payments run over Fedwire and Swift and not bank-to-bank. The core plumbing has always lived somewhere neutral and we expect that to be the case moving forward. As such, we think that chains like Solana and Ethereum and Hyperliquid will attract more issuers, more liquidity, and more developers precisely because there's no single company that controls them. Corporate chains and consortium efforts are going to struggle in our view to build broad ecosystems because the trust deficit is just extremely high.

Our last theme that we're excited about is cryptographic primitives. So, as I said earlier, stablecoins give AI agents a way to pay each other, but in a world where AI makes it really hard to tell what's actually real online, we're going to start to need tools to verify identity and data without creating massive honey pots for hackers. And we think there's three interesting opportunities here. The first one is proof of personhood like from our portfolio companies ZKMe and Worldcoin. This effectively lets people prove they're human without actually revealing who they are. The second exciting opportunity is fully homomorphic encryption or FHE for short, which lets computations run on encrypted data.

Things like underwriting, risk checks, and compliance can happen all without anyone actually seeing the underlying information. Uh and we've backed Zama and Phoenix in this space. And then the third opportunity here is ZK-TLS, which effectively allows agents and apps to check real off-chain facts, things like income and bank balances, directly from trusted websites without exposing the user's raw data or logins. So, I understand I covered a lot of content and ideas today in I guess 15 minutes. Um if you want to digest all of this in written format, you can scan the QR code that directly links to our 30-page thesis post on the space here.

If you happen to be a builder working on any of these problem sets, please come find me after the talk or reach out to me on Twitter. Thank you all. >> All right, everyone. We are in the home stretch of day one and we're saving a great discussion for last. Up next on stage, digital assets and insurance, on-chain integration and security.

All right, it sounds like 4:30. Pretty much. Good afternoon, everyone. Uh thank you for staying for with us and I will I will just feel so sad to, you know, I was talking to my fellow panelists today. Why did you really have to put insurance and digital assets towards the end? Just, you know, standing the way between the last part and and the cocktails. But, here we are. So, we will try to keep it as engaging as possible and hopefully we can add value to this very interesting first day of digital finance forum. So, my name is George Alayon. I'm head of insurance innovation and deputy director at the BMA and our role today is just really to uh

complete the conversation about this on-chain and digital you know, finance economy that we are facing here and for the most part of the day, a lot of the talks has been made about you know, on-chain integration, 24/7 trading, real-world asset tokenization, you know, crypto rails, building crypto rails and all of that. And one piece that is missing is you know, which is what we're going to unpack today is about risk transfer and insurance and mind you with all the the talks that we have, you know, discussed today about this the velocity of you know, digital asset space and we combine that with AI

one way or the other we're going to be have to be dealing with risks, right? And you know, in in a in a in a scaled ecosystem insurance is going to be a critical part of a risk management framework of a you know, of an economy like this and so luckily here in Bermuda we don't talk about insurance in isolation and you know, this may not be a very well-known fact here for for for some of you who are first time in Bermuda, but way back in 2018 when the digital asset business act was introduced and created we also actually made some parallel enhancements to our insurance act which

is you know, in introduction of the regulatory sandbox, the innovation hub and the creation of innovative classes within the insurance sector that's allowed to to complement and actually empowered this ecosystem to to also manage the risks that are going to be inherent in this ecosystem. So today I'm I'm fortunate to be joined by this wonderful panelists. Actually two of them are actually part of of my supervisory portfolio at the BMA and so I'm really honored to moderate this this panel today. So to my left I have a Joe Yocumski CEO of Realm and then I also have a Freddy Meade managing director at Howden Re, Hanson Orser from Solter Insurance and then finally we have Rick from

Institutional Asset Management perspective. So getting to the conversation right away um eight years or or so since 2018 when we enhanced the insurance ecosystem here to allow for digital asset business to flourish. Has insurance kept pace with the digital asset business in you know enhancements that has been. So maybe I can start with you Joe just really you know talking about you know what has been the the factors where insurance has improved the outcomes for the digital asset ecosystem overall and where are the aspects where we still have to grow and and mature. So maybe I can start with you. Yeah, I mean

if the question is has insurance kept pace with the pace of innovation in digital assets the answer is no. You know, broadly speaking we've got a six trillion dollar market right filled with some of the biggest balance sheets in the world and and when you look at the pace of you know the accommodation from that capital to companies pushing the boundaries of innovation in the digital asset space there's still a major mismatch right and I think the good news of course is if you look at the amount of traditional insurance market participation today versus 2018 2019 2020 certainly there's more participation

but there are amazing things happening on top of this technology that become you know I think far more adaptable at an institutional level with institutional risk transfer and obviously there are a lot of people in this panel that are working toward that conclusion but has the market kept pace no still lagging. Thank you. Freddy now maybe just because your your company sits with the you know between the insurance and then the reinsurance sector. So maybe from your perspective and anything to add from from what Joe was saying. Yeah 100% I mean it's it's very like kind of insurance and reinsurance is like a hugely complex market just in terms of products and and the volume of capital that is transferred around the world and it's you know kind of the access to that

capital is um, you know, the barriers to entry are very high. So, I think from, you know, both kind of I guess the re-insurance products working with digital asset firms to free them up to, you know, with the likes of Realm doing it to free up their operations is is, you know, definitely opening up more interest in potentially the uh kind of infrastructure capabilities coming back the other way to to insurance and reinsurance where actually the the kind of tech um, coming back to, you know, improve the operations of the insurance and reinsurance market, benefits are huge. And I think, you know, given the complexities of the market, there's no one kind of lightning bolt that's going to, you know, solve the issues, but we're definitely seeing education on both sides get to the point where now

I think we can hopefully see more adoption. And and the good news is that Bermuda is not stranger to complex risks and and depending on where these digital asset business companies are are in the stage of scaling up in their, you know, whether that's a captive capacity that they need or a primary insurance risk management needs or even for, you know, any index-based, all of that we already have it. We we regulate it here in Bermuda and we, of course, I'm biased, I'm from the BMA, so, you know, in in our in our point of view, we we try to, manage it well, especially all those, you know, dilemmas that we need to manage. So, hence, if I can get to you from your point of view as well as being as a specialty insurer,

anything to add, you know, to that same question where we have to uh mature, still mature or maybe just a basic question about whether we have kept pace with the advancement or not. Yeah, so, and it's it's interesting to think about DABA from 2018 because there's many other even um more developed jurisdictions that still are on their journey of trying to make sense of regulatory framework and and clarity. Obviously, DABA was was very early days and and and visionary as we heard uh Premier Burt talk about uh this morning. But I I like to take a step back and and think about, you know, where the industry has evolved since 2022

um when when we had, you know, a crypto meltdown, flash crash, and and um you know, a lot of losses. And so, uh on the one hand, uh DeFi worked perfectly well in 2022 um with people on their Ledger Nanos and Metamask wallets and participating DeFi and the smart contracts worked. Um and that DeFi did what it was supposed to do. It was where you had unregulated exchanges, particularly uh FTX, um uh which um didn't didn't have any compliance, KYC, AML, no separation of client assets, no auditing, no separation of

proprietary trading versus market making, um all all these things that that were wrong. Um and of course, you had fraudulent uh activity as well and and people got badly badly hurt by that. And so, um there has been this incredible need for for compliance um and and licensing, and we've seen that um adoption along with that. There's been some uh required needs by regulators uh for financial institutions getting licenses and involved in digital assets um to get in insurance. Um and as a result, with sort of better operational and compliant capacity, I do think to some extent the capacity from traditional insurance balance sheets, um

it it it has increased. Um I think that the the language, the policy language, which was a real sort of hodgepodge of traditional insurance policies, you'll get something like species adapted to uh digital assets. And of course there's new entrants like us providing uh some capacity. So, so it it it has evolved some, but the amount of insurance capacity um in the market space compared to as Joe just said, the the size of the marketplace is is is drastically under undercovered. Yeah, and and this is the thing, right? The nature of this insurance sector um cuz you know, accidentally as well

coincidentally, I also manage the cyber insurance thought leadership uh within the BMA. So, we see that a lot as well. Like that's the whole cyber security cyber security landscape is quite massive, and what the insurance sector is trying to do is like try to like put it in a uh in a workable solution some aspects of it where you can actually the insurance solution um is able to provide that coverage to to to manage the risk. So, I see I see that as well, that parallelism uh within this space, and um it's just amazing how we can, you know, really also uh try to manage that risk by matching uh you know, the the exposure with the with the actual um assets. Um I want to ask this time with with Rick because uh you

you have you offer a unique point of view because these three gentlemen that I have, they they handle the underwriting. So, they're are more like the liability side of the balance sheet, so that the right side of the balance sheet. But, you represent the the you know, the institutional investment side, which is the left side or the asset side of the balance sheet. And so, you maybe from your perspective um you know, same question and maybe where the insurance industry uh still need to mature at this point. Yeah, uh so thank you, George. Uh so, when you think about Franklin Templeton, we're almost an 80-year-old asset manager.

When you think about the insurance business and industry, it's probably a little bit a little bit older than than us, right? So, I think there's interesting parallels between what we've done as a large conservative asset manager a conservative insurance reinsurance industry but you can definitely take cues from us as how we started our journey in the digital asset ecosystem. And I think it's a very unique advantage point to to kind of see what a large asset manager like Franklin Templeton has done in the space. When we really started thinking about digital assets it was more of an idea.

And from that idea came about the ability to be humble, to learn to take risks, but to take calculated risks of how we look at transforming an entire um you know, asset manager from being a conservative but innovative asset manager. All right, you guys. Welcome back to the Bermuda Digital Finance Forum day one here in the lovely island of Bermuda. Everyone's on island time in this entire island except for everyone at this hotel where deals are being done, licenses are being granted, and partnerships are being struck. We're here with Andre of Bitcoin Suisse. Andre, welcome to the show. First time having you. Good to

have you. Congratulations on the licenses, on on the news so far. Before we get into that, how's Bermuda treating you? Is this your first time here? First time on the island, um but so far so good. Um weather could be different, but um I'm I'm Swiss, so I'm used to the rain. But uh no, all's all good. Very cool. Well, uh you are uh co-founder and CEO of Bitcoin Suisse. Uh this is one of the oldest premium crypto brokerage uh crypto financial service firms, excuse me. You guys uh represent Swiss Switzerland. Um because you've been at this for so long, it feels like, you know, you've got plenty of experience in the industry.

But just today you announced that you've gotten these approvals for some new licenses. How will these licenses ultimately help accelerate the business? What do these licenses mean? Let's let's dig into this. Yeah, happy to to go into that. So, I mean, we today received from the BMA the asset management license or actually two licenses and or one license and the registration which helps us to provide asset management services towards clients including advisory but also discretionary mandates and to also manage our own products. So, that's amazing for us because we have been waiting for that for for quite a while but at the end of the day it's like very demand driven. So, whenever we build something we do it primarily for our clients. So, we

cannot really like anticipate in what direction the market goes so we cannot predict it but our clients are usually quite a good indicator. So, whenever they have like some sort of requests or demand we try to facilitate that and provide best-in-class service. Yeah, man. And I mean I think we've seen this regulatory climate globally become more and more receptive to the digital asset industry, right? I mean in the states we're seeing clarity at its final its final touches. We're seeing globally in the EU with the MiCA regulation really making a strong push.

I mean, this is going to be an impactful impactful license for your business. How how do you think about from your business perspective what what this easing regulatory climate allows you to do? What risks does this allow you to take? What kind of next big swings are you looking to tee up as a result of this kind of better climate that we're currently in? Yeah, 100% I mean the the the the regulatory clarity is for sure a key enabler for our business at the end of the day because else you actually take risks but regulatory clarity allows you to actually reduce risks because it tells you directly what is allowed and what not and how can you do it. So, that's why it adds a lot of clarity to the business and for us that's of course always appreciated and we try to position ourselves in those regulatory

frameworks where we see that the regulator understands our business but that is also committed to continue supporting the business and the industry actually more long-term and that's why we are here. How has the business changed since 2013 when you guys first started? How much has it grown? How much time do you have? I mean a lot, a lot obviously. So, 2013 we started as a classic startup in a yeah, wild west times more or less and we in 2014 wanted to become self-regulated because we were touching crypto and that was yeah, money in our perception but nobody really knew why we wanted to become regulated. So, for us it was a key enabler in order to actually bring in trust and in this kind of anonymous

world of of crypto assets. So, that was the very early beginning and since then of course more and more institutional demand picked up, governments are looking into it, sovereign funds are looking into it. So, it's a complete different world today. So, when you say self-regulated, you you mean to say that there's you know, essentially early on there was no regulation but you foresaw that this industry was going to be regulated and you said we want to be in the lead when the regulation comes and so we're going to regulate ourselves so that we are one of the leading examples when the regulation does come. 100% 100%. So, we saw Bitcoin as some sort of form of money or at least as an asset and even though a lot of let's say the lawyers

and even regulators at that time said yeah, you don't need to become regulated. Bitcoin is nothing, right? It's it's yeah, the legal clarity and certainty of what it actually is was for many years not really clear and given but we were touching money and that's why we wanted to become self-regulated for everything related to AML and that's why we then put ourselves under an existing regulatory umbrella in Switzerland that was like auditing us then on AML topics. Yeah, similar to other asset managers and so forth. That was the very beginning quite many years before anybody else in the industry picked up on that but we saw it as a key enabler for growth and for to provide actually legitimacy to the industry. And now you're leading the

international expansion for Bitcoin Swiss. Do you find that now, because there's sort of these fragmented regulation complexes, was it easier in the beginning to go out into these different jurisdictions because, like you said, it was oh, at least over here we considered it the wild west, there was no regulation, you could kind of go where you please. Now, there's these different regulation these jurisdictions, you need these licenses. How do you arrive and how do you approach the international expansion now given all of this regulatory co-complexity? It's a good question. It's a very good question. So, I mean, originally we were focusing on the Swiss market because Switzerland, when it comes to asset management, banking, and so forth, was already quite a yeah, quite an interesting and large

market. So, we saw ourselves as a pioneer in the Swiss market in order to like pro- first of all, drive adoption, but then also to like continue building new services, new products, and the new offering, and then help actually the mainstream average people in Switzerland to get access to crypto, but then also institutions at the later stage. So, short answer is, we were pretty busy actually with the Swiss market, but now, thanks to regulatory clarity and and the new licenses that are available in in regulatory environments where we definitely see the future, we also want to be positioned there, and for the first time actually in the history of the firm also grow outside of the Switzerland in active way. Yeah. Yeah.

You know, I'm curious how your client tell us changed. Like, you know, from the last 5 years or so into the last couple of years, has there been a shift in the type of client that is coming to you and wanting to you know, get exposure to digital assets? Is it Is it, you know, more traditional firms now? Is there high net worths? Is Has it always been kind of similar like Like, how is the spectrum of types of clients that you guys are working with changed over the last couple years? It changed a lot. So, 2013 when we started, there were no institutions, for example, so everything was like retail. So, we started with retail clients, but then over time and because we were doing KYC and then AML since like 2014, our cost to serve clients were definitely higher than zero

and a lot of the large platforms that continued scaling internationally with, yeah, no KYC and you just needed the email address and a password to get an account there. So, we had different regulatory requirements and at one point we had to focus on, let's say, larger accounts and then and focus less on retail because retail clients, let's let's face it, they they were also well served at those platforms that were super scalable and they also had a great offering, right? They were not regulated, but they had a had a good offering. So, we focused more on the affluent accounts and then beyond. So, retail clients that started in the early days became our high net and ultra high clients, but the typical client of Bitcoin Swiss is more like a crypto

native. It's it's founders, co-founders, uh developers, investors of the large protocols, plus protocols themselves, the foundations and so forth. And those are the clients that also keep us as close as possible to the pulse and the real innovation of the industry. At the same time, by now, of course, we also opened up for like the more tradfi segments segments like family offices, external asset managers, bank, insurance companies, AMCs, and so forth. Let's talk a bit more about Bitcoin generally. Yeah.

The The asset itself has changed. The industry around it has changed. We we tend to say that it's become institutionalized in a certain sense. >> Yeah. I'm I'm curious how your reaction to recent developments in Bitcoin has changed in the sense that now we have derivatives products and we have stretch and Michael Saylor is here and it feels like when customers and and and new people approach the industry, they no longer look at Bitcoin, they think all the gains have already been been gained. It's already appreciated to the extent that it will and now it's nominal gains in in this going forward. I'm going to look at something that's a little bit further down the risk curve.

We have the whole meme coins, NFTs, all of these things, you know, they they, you know, they ended up how high risk things tend to end up. Things like Zcash are catching a little bit more of people's attention because they feel Bitcoin's been institutionalized. I want some of the original Cypherpunk ethos in my asset and it has privacy and quantum resistance. How do you reconcile with the trajectory that Bitcoin has gone in recent years and where the rest of the crypto assets are heading? It's a very good question and also here I probably could talk hours about it, but I mean, of course it changed. It changed a lot. It it's it migrated from this original kind of Cypherpunk almost anarchistic approach towards like being an institutional asset that again

sovereign funds are buying into that yeah, I mean all the big asset and wealth managers are looking into. So that's a huge transition of course and when it comes to like the investment part of it, I always like to look at it in relative terms and I had the yeah, Bitcoin I saw Bitcoin at like below 100 bucks and yeah, I saw it of course with the latest appreciations that it had, but it's always difficult to say now Bitcoin is expensive, right? I told friends for example of mine when when I first started with with with the asset class and then like a year later said, yeah, why should I buy Bitcoin now with 1,000 it was like 100.

And then like one year later was 5,000. I said, yeah, now it's definitely too expensive, but I mean, if you could buy now Bitcoin for 5,000, yeah, great deal, you know? So that's why it's relative. So the question is really what are your alternatives and how does the appreciation look like in a few years and if you believe that Bitcoin has a higher value in three or five years from now, it's probably still a good investment to invest in it now. And then you mentioned all the altcoins down the risk curve, and that's usually the problem that most, especially retail investors, are doing. They try to do a shortcut. So, they missed Bitcoin now, and it's anyway too expensive now, right? Which, again, is relative and very psychological. So, they try to add more risk to their investment

strategies, and then they usually do also a lot of mistakes. So, they buy into something, or they invest too much in relative terms to their Yeah, what they could afford. Then, all of a sudden, they're forced to sell again. So, they buy high and then sell again at the low price, because they need the liquidity. Those are common mistakes, right? But, you need to Yeah, I mean, I also did those mistakes, but you need to learn from them and actually Yeah, grow up and continue. So, who do you think is the next buyer? Like, you know, we had kind of these major waves, a lot of cypherpunks in the early days, 2013 and such. And then, you know, kind of the early enthusiasts.

Now, we have, you know, institutional buyers. And then, Saylor is, you know, buying, you know, quite a bit as a result of him raising for stretch products and these things. Is it sovereigns? You know, there's speculation. Patrick Witt has talked about a big announcement coming out around a strategic Bitcoin reserve in the United States. >> Yeah. Is it governments? Who do you think is the next buyer of Bitcoin? I mean, let's look who is already in. So, retail had its its its fair chance and and Yeah, it will always continue to move along the the the adoption curve.

Institutions are already in. Sovereigns are slowly stepping in. So, the next big wave of adoption for me is is governments. And at one point, it's it's a little bit game theory, right? If you don't really know what the others are doing, you don't want to be Yeah, coming last to the table and then buying at at the highest prices. So, I think that's the next wave. And if you look at at Bitcoin and its characteristics, it's a completely decentralized asset. It's truly democratic. It's not controlled, it's not political. So, on a sovereign balance sheet, it's actually perfect. Uh, and, uh, it's, yeah, actually also the most, not the most, but it's it's extremely uncorrelated towards all other asset classes, and it has a asymmetric kind of performance. So, it's

extremely interesting also from a portfolio management theory perspective. >> Do you Do you think Switzerland can will or should build a strategic Bitcoin reserve? I mean, that train has already left, so they bought MicroStrategy or like like strategy shares, and, uh, I guess there's only one purpose to do that. So, they're already on board of that, plus we always like advocate at the general assembly of the Swiss, uh, Swiss National Bank that they should at least prepare themselves. So, I think it's it's a question of time. Others are more brave and and faster moving like in the Middle East, for example, but also think Luxembourg the other day, uh, positioned itself. So, so, yeah, early movers are there, and of course, that's only the ones who made it public.

There's a lot happening in the background. Some already have exposure to crypto because they seized some funds somewhere. Uh, others were mining, Abu Dhabi, for example, since 2016, they're doing mining as well, which is quite impressive. Uh, and I guess, uh, I could imagine that a lot of governments are in the background piling it up without actually telling it. Yeah. Um, Andre, I'm curious if any of your clients have been asking you about the latest underperformance of crypto relative to stocks or commodities. How do you answer that question? Um, I mean, that's exactly what we're here for, and also the asset management license is of course key for us because we also see our transition, uh, to go potentially beyond just crypto as an asset class, and, uh, it's a fair point.

If you only focused on crypto the last like 6, 9, 12 months, you missed out on a lot of opportunities. So, for us, it's extremely important to provide options, um, to our clients in terms of like, uh, hedging strategies as well, treasury strategies, but then certainly also other asset classes. So, we try to curate this in a way, thanks to the new license, of course, as well. But, it it it's true. So, if you are just focusing on crypto, you you're missing out, but you need some sort of guidance, and a lot of our clients, at the end of the day, are crypto natives, and they exactly need this this form of guidance, yeah.

Well, uh Andre, thanks so much for coming on. It's uh it's an absolute pleasure. You're a true OG. And uh congrats on the licenses, man. Absolutely, yeah. Congrats on the license. What are you most looking forward to here in uh in Bermuda? Uh I mean, it's uh it's amazing to be here, and it's a complete new um geographic region, uh very strong on the uh insurance and reinsurance business side of things. I had no clue about it, but uh the number of people that I met from this industry in the last couple of days is just like, yeah, unbelievable. So, I'm curious to learn more about that industry, and to see how blockchain technology can also like build the bridges into that industry, then of course, also offering access to a new uh asset class towards our clients, plus the density of extremely interesting

people here on the island is also high. So, I'm looking forward to further explore that. Absolutely. >> Get a beer, go snorkeling, maybe. Uh it's not just a beer here. They drink the Dark 'n' Stormy. That's the local uh national drink, so looking forward to that. Exactly, yeah, you know the drill, so. I know. Ladies and gentlemen, the co-founder of Bitcoin Suisse, Andre Magnin, we'll be right back. We're going to pass it to our panels on the main stage. There's another amazing panel ongoing right now, and we'll be back with our next guest. to a host of new risks and new opportunities, right? It's being redistributed and concentrated in unexpected areas, and I think um it'll be a a fantastic uh opportunity to watch risk continue to evolve, um and see how insurers react to it. And and one um

I think maybe just linking this to what Hanson's company is doing at the moment, one solid proposition that they have is they try to keep it simple by actually solving the asset liability mismatch on their on their on their part of the business model. So, you know, they actually offer the you know, the policy in the denomination in which the policy holder wants it. So, maybe Henson, if you can tell the the audience about the you know, where is the market and demand strongest in in in this space and what are the showstoppers out there to for the capacity to actually scale up, you know, what has to improve, what has to happen maybe in the sector? Yeah, I'll just briefly we underrate them fiat, Bitcoin and Ethereum at this point.

Certainly, the advent in the US of staked Ethereum ETFs with the ETF providers needing some sort of damnification or insurance for a quick drawdown in NAV versus the basket there um trying to match we've seen an increase in demand for Ethereum denominated slashing insurance. And then just looking back to the FTX debacle um people got their money back but it was after crypto broadly speaking it gone up four or five x. Um and so they got sort of the market to market on

the dollars plus some interest from their losses and so us denominating crime and specie insurance in in Bitcoin when custodians are holding a bunch of Bitcoin is a much better asset liability match and we're we're seeing demand around crime insurance denominated in Bitcoin for crypto operators as a result. And and by the way, just to keep keep keep it clear, FTX which was not which was not licensed in Bermuda. It was licensed elsewhere. So I have to make it clear. The other B. The other one you see. Don't confuse that with the other B. So, I just want to make it clear. They wouldn't have made gotten in if they came here.

Um but it's uh so I had to make that point just just to make it clear. Um but Rick, I want to turn to you maybe from the institutional asset management side of things. Uh what risks out there on the on the capital investor market um where you think maybe the insurance can come in and so all sort of, you know, help uh address those risk uh from an insurance point of view? Yeah, and then I'll I'll lean on my colleagues for their thoughts on that, but I think, you know, when you think about smart contract risk, I think that's something right for disruption in your industry of of how we look at it. You know, we have we have a suitability framework that we hold very high regard in in house and even with our regulators, it's in our prospectus of each network that we

choose, there has to be strict rigorous pieces in place before we even decide to to build on these networks. So, I think using that kind of framework, I think there's a lot of different things that we you guys can take from just how we view blockchains and how we view why we decide to build on these blockchains and and how you can maybe look into incorporating some type of insurance, you know, you know, dynamic for each of these blockchain networks because as we see over the last 3 4 weeks, there have been some pretty significant hacks in a different kind of landscape versus these networks, but I think there's a lot of lessons we have seen and can learn um from these exploits as

it relates to, you know, de-risking and risk transfer. So, we're you know, look, we're we have a lot of different businesses within Franklin Templeton that we're we're constantly navigating from the traditional side to digital asset side. So, I think um I'd love to hear from my colleagues on the panel what they would think would be something that we'd, you know, want to So, maybe what I can do is cuz I they're they're they're asking us that it's over we're we're kind of over time. So, I I want to I want to merge that with your final remarks maybe Just just to close the panel. So, maybe on you know, what what what kind of risks will insurance be able to actually address, help address in in in this digital asset ecosystem. And maybe

couple that with you know, what would need to have happened in 5 years for us to actually say that insurance has now become a you know, a critical part of our strategic business model of any company. So, I don't know, maybe Joey you want to start things off. I'd say 5 years from now we should not be referring to it as crypto insurance. It should be digitally native risk architecture. And I think if that's, you know, the construct within which we're operating, I think that will be a huge step in the right direction. 100% agreed. I think it's the the kind of adoption of the infrastructure for a full compliant on chain, you know, a camel KYC capital coming to a growing marketplace, which is crying out for more efficiencies and to offer, you know,

diversified yield to the new breed of investors and also existing investors using the technology to to access the the space more efficiently, then that's, you know, where we should be in 5 years. Awesome. Hanson. So, the diversification was sort of the the one word answer I was thinking of when I read your question. We do still have this nature of the risk of there being a set of master keys or an omnibus wallet where all the assets are gone. And I think in the tech design, wallet providers have to figure out how there can be diversification amongst wallets to to segregate the the risk so that when you're writing

one-off insurance that, you know, an event just doesn't seize all the assets. Great point. Rick. Yeah, and I'll I'll just keep it super clean. You know, 5 years from now we're not talking about blockchain anymore. It's just it's work the same way you drive a car every single day, you know, blockchain's going to be a facet of everyone's daily routine. They're just not going to be thinking of it as this, you know, nascent technology anymore and it's not going to be on the tip of our tongues. So, I'll use that as blockchain is going to be fueled in your world and it's going to be continued to be fueled in our worlds and we're not even going to think about it anymore. And insurance is embedded as part of >> Exactly, yeah. Insurance is embedded in all that. So, that's how I think we should be in the next 5 years. Okay. I

got to think about that. Fantastic takeaway. So, thank you so much for staying with us and enjoy the rest of the forum. All right, very quickly. I know I'm I'm keeping you from our beautiful reception at 1609, but thank you everybody for coming out to day one of the Bermuda Digital Finance Forum. We'll continue tomorrow with content in this room in the morning. Then in the afternoon, we have a series of round tables that are

going to take place through the Trudeau Ballroom, which is on the other side of the hallway when you exit the back here of Harbor View. So, if you haven't signed up for one of those round tables or two of those round tables in the afternoon, you can do so via the Luma links that have been shared on the main Luma invite. And right now, everybody head over to 1609, the beautiful restaurant right on the corner on the water out there. We're going to have our evening reception for tonight. It's going to be a beautiful night. The rain has stopped for the time being. I don't want to promise that it'll it'll stop for the whole time, but you'll be indoors at 1609. So, we're going to have a great night. Thanks again for for coming out to day one of the Bermuda Digital Finance Forum. We'll see you

soon. >> And with that, day one of the Bermuda Digital Finance Forum has concluded. Be sure to join us tomorrow for day two, packed with more insightful sessions. But until then, join us over at 1609 for tonight's evening reception. >> Already guys,

welcome back to the roll up. We are live here at the Bermuda Digital Finance Forum day one. We're here with Arjan Sethi, the co-CEO of Kraken and Payward. Arjan, how's Bermuda treating you? Uh it's good. Actually, this is my first trip here to Bermuda. And uh it was bumpy on the way in, so I can see how people can get lost, you know, in the rocks or Bermuda Triangle, whatever it might be, but uh it's pretty beautiful, so I I have to admit. Yeah, very, very cool. There's lots of great people here. Uh I mean, we've talked to uh a lot of people that are focused on regulation, uh Clarity Act.

>> your institutional lead as well about the news with Franklin Templeton. Yeah. How how was that? I I stepped out cuz Sandy and uh and and he was here. Yeah, I mean, you guys obviously moving forward, bringing all different types of assets on chain. You guys have had a hell of a run last couple years. Arjan, it's your first time on on the show, man. I was just telling you that, you know, Rob and I were trading in the University of Florida library on Kraken in 2017. Um but this year >> and I heard you guys got wrecked. Yeah, we did. By Arthur Hayes. I don't know why I ever took my money from Kraken to BitMEX. That was the first mistake.

>> That was the that was the beginning. And got debanked. And so, Operation Choke Point, uh you know, uh caught another one, unfortunately. Yeah. You said you you were also part of it you also got caught up in that? >> I I was de-banked by FRB and SVB. We had started a crypto fund. Obviously, they didn't tell you why you were being de-banked, but that was part of the process. And No, you just got the letter in the mail. Yeah. Well, I didn't get the letter in the mail. I just I got the phone call saying, "Hey, we got to turn off your account." And then you would ask why, and they said, "We can't really talk about it cuz there's some KYC AML issues." I'm like, "Okay, well, what does that mean?" And then it just gets lost in the ether. And so, the entire

industry has come a long way. Like we've overcome so much you know, Operation Choke Point, the Gary Gensler era. Now it feels like the resurgence of public markets are coming around, larger crypto fund raises as well. You've been you know, at the center of this. Kraken has been at the center of this. I'm just curious if maybe you know, you can you know, talk a little bit about the transition from what we were facing as an industry you know, even just five years ago to now. What do you think have been some of the most significant changes that have allowed companies like Kraken to flourish?

I I think one thing that gets lost is that most people look at crypto just from a US lens. And I think it's it's important to take a step back and remember globally it's being adopted. So, we talk about early adopters, mass adoption. We talk about BTC to BTC to ETH to all coins, stable coins, tokenized equities, commodities, so on and so forth. And uh I think probably what has made the industry more successful is that you've just had global mass adoption in a permissionless way. Where in a lot of the what you call rest of world markets, some people call it gray markets, unregulated markets. That's not true.

They are regulated. It's just that the regulations allow you to be able to build access, create foundations, create any of these products for people in the crypto ecosystem. And then over time you've seen you know, people create a lot of unique products including perpetuals, which is I think something that gets missed cuz we've moved on to prediction markets as quickly as possible. Um so I I think for companies like Kraken or Coinbase um started in the United States, took a regulated path. And regulated path doesn't mean like the right path or the wrong path. It just started in the United States and so the natural inclination was let's regulate ourselves and let and let's be good stewards and then expand. Uh but some companies only stayed within the United States, some companies went into other

regulated markets. So we did is we went global right off the bat. Um Europe being sort of our actually first market and then coming back to the United States over the last 15 years. And that's actually what's helped us uh become more and more successful because each market that we went with any of our products across consumer or professional traders or institutions, we're able to test that out in any of these global markets, see what worked, get adoption, then bring it back and forth depending on which constituent or jurisdiction mattered. Mhm. Yeah. I mean Kraken started as a place to trade crypto as an exchange. It's since grown, you know, massively into what I kind of think of like a almost like a prime brokerage on chain, off chain, a tokenization platform. There's there's

so many product lines. You know, I'm curious when when you were starting Kraken, what was your original vision for what this crypto landscape would be and what this Kraken company could be? And and just kind of take us through this evolution here of the developments. Kind of a lot of these things are path dependencies, right? Where certain events happen that are out of your control that dictate your product strategy or dictate your expansion strategy. Can you just walk us through the evolution of this company as you started from a very small kind of grassroots company into now a very large a very large organization? Yeah, so just to clarify, I didn't start the company.

Um but I was an early investor and believer. So the two co-founders um Jesse Powell and Tom Lu started the company around 2011. And the and they had started the company based off of the premise of what they had seen with Mount Gox. So, if you've been in the industry long enough, you know that Mount Gox um got hacked um not just once, but a couple times. Um and so, Jesse was a part of some of the folks that went to help figure out um how to fix um Mount Gox and and make sure this type of stuff didn't happen before. He actually then decided to come back and start a regulated exchange.

But, what was more important was that um it was an exchange where it was uh regulated uh privacy and security um from day one. Um and then also just making sure like there was a a matching engine that like made sense, an order book that made sense, and it was and transparent, just like you would see in any traditional market. That's how the company started. And so, you create an exchange, and obviously BTC then ETH, you know, amongst other assets over a period of time. And what was more important was um his background and uh coming from gaming, but then also moving directly into professional trading. Was how do you build a product for professional traders? And professional traders want want They want smart execution, they want transparency, they don't want to be front run, they want to

be making sure that they are trading at the same level of any institution is trading. So, it's not It's not that someone gets um a subsidy or a kickback, which is what you've seen in a lot of exchanges. And so, we stayed what we call fair right from day one. Um And so, that's how That was actually how we started as an exchange. Then, we built the infrastructure um on top of the exchange. We added more onboarding and offboarding. We went more global. Um and then we added more and more products because our professional traders were demanding that. They're They're A, they're in the most price-sensitive people on Earth, right?

Because they want like uh cheaper cost, they don't want the transaction fees, they also want access to leverage in some cases, they want collateral efficiency. So, we kept building out these products. And so, then we then we actually evolved in two different directions at the same time. One was, how do we cater to institutions? So, for algorithmic folks, the high-frequency folks, etc. Then we want consumer, which is okay, great, all the products that we built for professional traders, how do we simplify those products and give it out to consumer and retail folks all over the world. But professional traders are not in one jurisdiction, they work global. So then we got licensed in Europe first um over a period of time.

Um I think we're one of the first exchanges to get um uh MiCA authorized through CBI. Um we got our uh MiFID license through Cyprus to be able to uh cater to all types of products and services um in Europe. Then we did the same thing in Canada, Australia, now in the United States. So I The reason I say that is we're going market-to-market, jurisdiction-to-jurisdiction. Capital markets licenses, money transmitter licenses, so too much detail could be boring. The whole point here is regulatory stack, infrastructure stack, exchange stack. You can think of us as building Interactive Brokers, a banking and financial services product, um an exchange like Nasdaq all in one stack.

And then we have different products or interfaces, is what we call it. So Kraken Consumer, Kraken Pro, Ninja Trader after we acquired them last year, are all interfaces that hook into the exchange as first-party applications. And that was the story, and then we elevated Payward as our brand, which is what the company had always been, to say, "Okay, great, we've built out the infrastructure in order to support our first-party applications, and now we're going to use that same infrastructure and microservices that we created in order to enable fintech apps, um algorithmic traders, anyone who wants to build permissionlessly over time anywhere in the world, trading as a service, trading service in a box, onboarding and offboarding, card issuance now, treasury management um with a new new stack acquisition to reap." Yeah. And so the more of the stack we continue to build, the more

liquidity we build, the more uh custody, staking, and lending we can offer to not just ourselves and our customers, but everyone. Then we can let people build permissionlessly everywhere. So that's been the story in the arc and what we've been building towards. I I want to mention just a couple of the things in the regulatory stack that, you know, are in addition to this micro license that you talked about early on one of one of the stewards there. I I also saw the skinny fed master account. Um this is part of the US stack. This was a big announcement as sort of a working group thing that they they theorized. You guys came in and made it practical.

Uh I think there's also a a bank charter, you know, floating around out there as well, which also adds to the comprehensiveness of this regulatory stack in the US in particular. Um and then you mentioned how, you know, the the grand vision here is that, you know, you have all of these interfaces that hook into the primary exchange and you have regulation interfaces uh that that provide the fair fairness and protection around these interfaces and the exchange itself. >> Well, the interfaces are how we interact with the customer. Mhm. And then a certain set of those customers also provide liquidity to us or we provide liquidity back to them. Uh but I think what's more important is that, yeah, I mean, our regulatory and infrastructure stack is embedded so that we can serve clients for the products that they're looking for. So, for example, we just

recently uh launched spot margin in the United States. Um it's always been available in other markets, but, you know, a week ago we launched that and the reason we launched it was because we also acquired Binomial. So, we have the necessary FCM, DCM, and DCO in order to be able to provide these services to our customers regardless of who they are from an institutional to a pro trader um to an accredited investor or equivalent for a CFTC or commodity style trader all the way down to a, you know, retail margin trader if they want to, you know, use any of these products regardless of the asset class and I think that's important to a multi-product multi-asset. So, we say crypto, we think BTC, ETH, altcoins, meme coins, but tokenized equities is a large part of that and then over time we're going to do uh equity perps um

akin to, you know, how people think about single stock futures, but we're going to focus on perpetuals. Yeah. Curious cuz it feels particularly relevant today, you know, Anthropic came out and said, "Hey, you know, a lot of these secondary SPV vehicles aren't really shares." I think the price on chain dropped 24% or so. Obviously, these things are still, you know, they're still at their fair market value when it comes to the actual shares. How do you think the the subset of the industry of tokenized equities, how do you think that is going to progress? How what is your tokenization mindset when it comes to these high-quality assets like equities?

So, not all equities are high-quality. Not all of them are like, you know, assets that you want to buy. And so, since the late 1800s, you know, 95 to 98% of equities that have ever been created are zero or don't exist today. And so, you can make the same argument like, you know, about meme coins and the half-lives and what, you know, what you should be investing in or whatnot. So, we're not going to give investment advice, but I think it's always important to understand the context and history of an asset within an asset class and how long they last. Um in terms of equities, even in the public markets and private markets, there's something that you call power law. Right in the public markets, we call them the Mag 7 or the Mag 8 or whatever the numbers are going to be in the future or the Mag 1, who knows with

um you know, the AI companies might be like, you know, in a league of their own. I think what's important is between the public and private markets, how do you deliver access to people worldwide, which is the promise of crypto in the first place? How do you give them access to be able to get access to these assets? Now, once you have access, what do you do with that? Well, in the United States, we're used to being able to borrow against it or store it or lend it out, etc. So, you want to be able to make those products available freely either through DeFi or through the exchange or, you know, vertically integrated together depending on how you think about the layer one and the layer twos that are out there. Like, we're in the really early innings. So, when I say all of these things that I don't mean to

use um you know, like flavorful bombs of just like, you know random like, you know, flavor of the week of of a word. Um but it's more that like, we're trying to figure out what this will look like in terms of access to capital and then access to debt on behalf of those assets. So, it could be anything, right? Gold. We had We announced the Franklin Templeton, you know, gold tokenized gold ETF today. Great. Well, what is it What are the next set of 10, 50, 100 that are going to be out there that people want access to here in Bermuda, Latin America, Africa, Asia, etc. Um and then how do you use that as collateral to do something? So, you go from a speculators traders investors savers risk managers, they all have a different um value set around what they care

about. But if you're on one collateral system or have the ability to settle immediately, no matter what the asset is, then you actually can just make better what I call risk management asset decisions. And that's just something that we haven't seen before. Usually, the ones that can do that are the Citadels and the Jane Streets of of the world. They're not bad guys. They just were smart about creating infrastructure to do it. Now, what happens when you can give that to, you know, all three of us, like just sitting around? And then what happens when you have AI agents with their own like sub accounts, with their own stablecoin accounts, or their own credit accounts, etc. Like the world looks super interesting at that moment.

>> Yeah. Yeah, and and I'm glad that you brought that up because I know that you have some, you know, some of these recent acquisitions on the stablecoin side, on some of the infrastructure side to kind of beef up the broader product strategy here. Recently, we saw one of your competitors, Coinbase, lay off about 14%, I think, of their employees, citing AI-related claims with regards to uh trying to, you know, improve productivity. You were also at Nearcon back in San Francisco um in February, and I'm just curious kind of how you're thinking about the growing use of AI internally with your team at Kraken, as well as, you know, kind of you know, building off that, the convergence of crypto and AI at large. We saw a lot of

talk as of late around a product called um Venice from Erik Voorhees. Obviously, Near is doing a lot of work here. How are you thinking about using AI in your company? And then what is your kind of broader holistic view on the convergence of crypto now? Yeah, so there's multiple questions there. So I'll try to tackle them one at a time. Um one is I I think there's this predominant feeling that AI um anything you're going to lose jobs. And I don't And I think that's that's an incorrect way of looking at it. So let's just take a step back on even what you've seen with open claw or any of the other products that are out there, which which I think is just really exciting.

You as an individual, if you use uh claw claw code with sub agents, they have their own or use um open claw, what are you able to do? You're able to do something that um is what you would have to, you know, hire a team of 10 people to do, 100 people to do, or 1,000 people to do. And in some cases, if you're really good at this, um and I'm going to try as hard as possible, is like what if you had an army of like a million people working for you? Okay, well, imagine if you arm, you know, the 3,000 or 4,000 plus people at your company to do the same thing. I think one thing that people get scared about is like, "Okay, well, what happens if" and I have this conversation internally all the time, you know, you you think about Karpathy's second brain

and what he's been talking about. Well, we implemented that, you know, 3 months ago, then another um 3 weeks ago, and you throw away some stuff, and you put it back um into place. How do you enable everyone at the company to be able to have access to the same information frankly like the CEO does to be able to make decisions? If you make an entry point person at the company just as smart and contextual, actually not smart cuz I don't know if I'm smart or not, but let's just say has access to all the information or context of the company, how much better of a job will they be able to do because they can just train themselves along the way? Now, imagine if they have 10, 100, 1,000, a million um agents helping them along the way, which is where the world is going to go no matter what. Like

that's not It's a foregone conclusion. So, can you be more efficient? Absolutely. But can you do more things? 100%. And so, I think what you're seeing in the market today because there's headlines around it is that there are certain um things these companies have done over the last let's call it 10 years or 20 years actually um uh companies that have built off of uh technical capabilities or infrastructure that are that have a little bit more debt and that they're older. So, what do they need to do in order to be able to adapt to the times or to be able to build at a high frequency or have someone who has like a a team of three people of engineers and have like 10 again 100,000 agents to work on their behalf to code and get

things out from continuous deployment to deployment into production. Um it's just a it's a it's a different muscle that you're building out and so I think what you're seeing is that you are shedding some jobs in order to hire in another area and then there's some workflow automation that's happening without AI regardless which is you know manual things that people were doing and then can you empower those same people to do more things and if they are willing to adopt AI which you don't see a lot of time. Sometimes people will say you know what I just don't want to do it. It's kind of like asking you know legal and compliance or finance ops or even BD sales people to to use salesforce or to use slack or to use any of these systems and a lot of people didn't adapt. All right, it's it's kind

of like asking hey should should you like write things down on paper pencil for your grid or do you want to use Excel sheet and a lot of people didn't want to use Excel. So, I think there's always this fear of using technology is cheating or that you're going to have brain rot or you're not going to be smart and I think you just have to continue to educate people to say hey it's okay along the way that you're getting help because that means you can refine it. You can have AI still come up with crap. If you are thinking about something in like a um in a non quality way. If you think high quality and you have help along the way then ideally the outcome is high quality. That goes for every function in the company. Um and so so I think a a lot of people are having

the identity crisis. If you don't have the identity crisis and you're going full throttle in, I think what you're seeing is people just get a lot more creative and those companies are just moving at a faster pace. I don't know where we benchmark, but it is like a P0 for us internally that you have to use this and if you don't, you won't have a job at our company in the future. Not because we're automating you out, it's because you're not adapting to the future of what it would look like for our company to be successful. That's internal. Externally, the more you know about what you need to build, you can build this on behalf of your clients. So, I want all of my professional traders, I want all my consumers to be able to have access to as many agents as possible. I want them

to be able to have access to as many yield opportunities and products as possible without them having to try to figure out how to understand the complexities of, you know, smart, you know, smart trading or algorithmic trading or smart order routing. Like these these or like, you know, what's a limit order? Like sometimes these things are actually easy for someone who's been educated, but imagine educating them along the way, with help along the way, if you have teachers along the way, however you want to define it, co-pilot or not or completely automated or not. I would love to just put all my money, which is what I'm going to do, just through these systems and say, "Okay, agents, go wild." Because I trust them more than I trust these intermediaries and people along the way. And I and I think like with crypto, with AI agents, workflow,

whatever it may look like in the future, that is definitely a mission worth fighting for. Because we just haven't seen that before and I don't think you're going to have traditional financial apps or traditional banking, you know, companies actually try to adopt that. If they do, I think they'll be successful and so we're just going to be at the forefront of pushing this as much as possible. Uh an observation is that the organizational structure of Kraken sounds very similar to the the product structure in the sense that you've given everyone in the company a context window into everything that's happening at the company. We're on our way there. I wouldn't say that we're 100% there.

That's the vision. That's the vision. And and similarly, you've got this product suite with all these interfaces into the full context of the liquidity across all of these different platforms. You know, everything's segmented, regulated as it as it should be, but you've got signal and liquidity baked in across several different products that gives an entire suite of context. Just very similar to the the second brain concept that you mentioned, this I think is the epitome of the financial super app thesis. I'm curious if this was a deliberate decision to build the product and the organization in this way where, you know, you you see something through a lens, but you see everything through that lens.

Um that way everything is being shared and we have the full context no matter what lens that we're looking at it through. Was this a deliberate decision? If so, how do you think this helps build a better, more efficient system when it comes to product as well as organization? It's a great question. Um so, one of the other hats that I wear is on the asset management side. So, I started a firm called Tribe Capital. And then when the Tribe Capital, um the value proposition was like, can you use data to make better decisions? What ended up happening was that we used data to make sure we don't make bad decisions, right? So, how do you say no more properly than how do you say yes when you need to? And so, we had come up with our own quantitative framework for product market fit, which is does the

company and its product work or not? If the answer is yes, then you dig deeper. If the answer is no, there's no point to dig into finding out if we should make the investment or not. It's just a no. So, that's a capital allocation strategy. When you're at a company, especially as an executive or people that are leading the company, what are you doing? You're allocating capital. They're also allocating human capital and then processes. It's it's no different. So, you need to be pretty surgical about how are your um quantifying product market fit. That's essentially the first thing that I did when I came into the company was this is how I view the world. By the way, now I view this world this way, but I have access to a ton of data and so, I'm able to benchmark company after company um rather than like remembering it.

Okay, so what does a typical VC do if you've interviewed them? They meet with a company kind of like this and they say like I look into your eyes and all right guys, let's do this. Well, in reality, that might work you one out of a hundred times. I don't I don't like making those types of bets. Um, and so for me it was like great, well, let's meet. Let's like take a look at all the data quantify surgically like are you a company that works or not? And then I can get to know you and see like what you want your vision to be based off of that foundation and and baseline. And then we can add capital and talent and whatever help you want in in order to succeed.

That worked out pretty well for us. So we said okay, well, how do I do that across the board for what we're thinking about um in the financial services space? Cuz what are we building at the end of the day? We're building out infrastructure, we're building out distribution, we're building out engagement, um and we're building out product interfaces. So it wasn't a super app theory. What we said is okay, you want to have infrastructure to be able to build specific um we call first-party applications internally. But what is Facebook at the end of the day if it's not like a unified risk engine for advertisements and retargeting? Is Instagram has data and engagement, Facebook has data and engagement, obviously they monetize there. WhatsApp has very minimal uh monetization but high amount of engagement and usage and distribution.

But those are product interfaces that all relay data back. You can call it data liquidity if you want to and then they're able to monetize off of that. We do the same thing which is like we've got, you know, um folks that are depositing capital but like that interface is going to be just different. They're not looking to trade or speculate, they just want to deposit their fiat or they want to deposit their stablecoins, OTC, tokenized equity, so on and so forth. That could be an institution, it could be an RIA, it could be just a wealthy individual. So they'll they think about the world in a very specific way depending on where they're located, too. Then there's just, you know, professional traders as I mentioned before, arbitrage. They're looking for smarter ways in which to be able to trade and they want to speculate, they

want to gamble, they want to go YOLO sometimes. They want to be able to use margin, so they might want to use leverage somewhere else. Great, there's products and services and interface specifically to that. The reason I say these as examples is that you can't um Frankenstein this all into one application. Why? If you take a look at all the apps you've ever used, if you don't like uh an interface, you leave. You churn and you look for an interface that's better for you. You trust it more cuz you believe that you know what they want on your behalf. Um they have more data about you. They might have a better way in which to swipe. It doesn't matter. Like there's always these um unique value propositions. So you move your capital. Um and so I think like that's where everyone's kind of gotten stuck, which is we've gone from a world

post World War II where everything was at the bank retail location. Over time we bifurcated it, and it's it's weird to me that somehow in the digital world, we're going to have everything munged into one. From an infrastructure level, totally get it. That's what AWS does. Um but to have it all in one interface, I just think makes no sense sense because if you're thinking globally, if you're in Argentina and you are starting off your life with stable coins, you're not thinking about speculating, right? Like commodities. You might over time if you grow and you accrue value and you have forward mobility, great. But then there's a certain level of people like at the I call it mid-market or enterprise that may want to do that. But you go jurisdiction and country by country, and then you look at the products that you

offer. It cannot be the same and it cannot be Frankenstein. So in order to be able to think in that direction, uh um Bill Gurley has this really good line called like you got to you got to play the game on the field. It's like well the game on the field are our customers, and there's a specific value prop of what they care about. We have to build experiences for them. And then we walk backwards, which is okay, what's the tech infra um uh exchange that we may or may not need. And then what is regulatory stack that we need? What's the onboarding and offboarding? And then who are all the bank partners we need in order to service that customer. And in some markets, that's a huge stack, and some markets that's about half the stack. Yeah.

You know, on this kind of uh comparing the culture of the org versus the product and kind of thinking about these things in this in this lens, you know, I'm curious in the in the current state of the company, right? The private company versus where you guys are headed in in this public setting. Given the expansion of the product and as you mentioned this kind of focus on employee agency or at least this ability to kind of really shape your own destiny with with these tools internally, how much do you expect your company's culture to change after you go public? And what will you do to preserve the startup kind of vibe amidst a more scrutinize regulatory path ahead? How do you keep employee agency, keep the kind

of early stage what like ethos driven company in a more public setting going forward? I think first and foremost it just comes down to your cultural values. And so you can make any statement you want on a website, but it doesn't mean you live to it and it doesn't mean you have virtues and values around it. I think um Uh Ben Horowitz has like a really good book which is like, do you live and embody those values of what you write or do you just write it on like a tombstone and you forget about it? Um and so part of what we've done and we've made mistakes along the way. It's we haven't we have for us to say we were perfect the whole way. Like I I see these podcasts of other founders or executives that say, "We kept our culture the same the whole

way." I just think it's total because of course it evolved. And so did it evolve for the better or did it get worse? Especially as you get larger. And so there's a lot of books around this. There's a book a great book called Loonshots. I actually just sent it to my COO yesterday cuz he was going through what I call um penny-pinching for everything and I was like, "Dude, just read this book, please. Um and then use that framework and let's have the conversation again around like, where do we want to innovate? Where do we want to try things? Where are we okay to fail? Learn from it and then try again somewhere else." Um and so those are hard things. We're not going to be perfect. We're not always going to be uh great at something, but you can learn and iterate and iterate. And I and I think for us um

one, we We ourselves Payoneer Pirates. And so I think pirate has a meaning. Some people think of it as a nefarious attitude. Steve Jobs thought of it as like, this is how you think about, you know, building great products. Um or you could be like the navy or like the red coats and like lose the war um um like in the American Revolution. Or the rebellion, depending on where you're located. Uh and and uh and that's that's always going to ebb and flow for us. And then each team, each interface, um if it's infrastructure or microservices, they all have different things in the line. And so, there's different uh what I say, definitions of what innovation means for those people. And so, look, uh between myself and Dave, who are the two co-CEOs, we've got roughly about, you know, 75 to 80 reports

um any given month. And and I think that will either keep it that way or add it because we have different, you know, products and services that we're building. And some of those things we know won't work, but we're going to try anyways. We're going to invest. And then return on invested capital might be zero. Um however, we might have learned a lot in terms of how we want to do it the next time. So, if you actually look at any of our products that we've built um or that we bought or that we've rolled out, regardless if it's yield, um we've tried it in some capacity in the first place. And we've tried it in some market and we've seen what the results were. And a lot of times we've come back and said, "Hey, you know, we have no expertise here. We got to buy it." And I

think that's a better way of thinking about how you want to build out your culture in maybe a more authentic and honest way. Not to shareholders externally, but to everyone internally to say, "Look, guys, I need everyone to help us think about getting to this next North Star um or our KPIs for the for our total North Star." And I think like people at the company have come a long way. We have a I'm pretty proud of it. We have like a bounty system. We have something called a LFG reward, which basically stands for let's go reward. Essentially, like if you come up with something that's really innovative for the company and we adopt it, um then that's like a performance grant.

And these performance grants are actually quite high. In some cases, my hope is that they get paid more than any of the executives do on a yearly basis because they're coming up with the ideas. And so ideally it's a merit-based system and an ideas-based system that are the best that like surface to the top. And those are the people, I think even more importantly, that are leading the initiatives of the company, are leaders of the company, and we're building um the organization bottoms-up leaders from within versus saying, "I got to get someone from the outside, got to get a resume." Most of the talent exists internally at the company.

>> Yeah. So yeah, there's a there's a there's a kind of saying that you know, you as a person, you have to become the person uh able to manage millions of dollars, able to manage thousands of people. You have to be the person in order to you know, be in that role, right? And and it's kind of like as much of a personal development as an entrepreneur as it is like building a company and building a a good product and building, you know, a service that people want to buy and be able to really like articulate that. We talked about like the like the culture and the way that you're building this company. What about yourself? Like what what kind of actual changes have you made to your personal life, to yourself as an individual that has allowed you to be

the co-CEO of a soon-to-be, you know, multi-billion-dollar valued public company? What is What is some of this personal evolution look like from your habits, from your rituals, from kind of your actions? How have you How have you become the person who deserves to be in this position? Yeah. Um so to the last line, um I think deserving to be in the position uh that's a hard one. Like I don't know if I deserve it. I think it's just there's a combination of luck, there's a combination of skill, there's a combination of timing. Um there's a combination of trust with the folks that you have around the table. And then there's also um that um internally at Paperwork, um we

probably have not a diversity of thought. We're actually just very focused on a very singular mode of thought, which is like this is what we want to do, this is what we want to achieve. And I And I think like that means that culturally, how we think about um running ourselves is we're we're running hard all the time. Um we're we're not in a place where we think about um work-life balance, we think about work-life harmony. And we state that very, very publicly, which is like this is the expectations of people that are at an executive level, director level. Um and that's not always easy to to digest, right? Like a lot of people that say I want a work-life balance, we're not the place. So, we actually have these programs uh that I think are really important

that we set up over the last 2 years, which is like we'll help you sail away from uh Payward. Uh which is that if this is not the place for you in the first like, you know, even, you know, 3 months, 6 months, or a year, we'll help you find a job and like Payward's not the right place because we want to make sure that everyone that's there is giving more than 100%, you know, giving more than what you would typically do because the mission of what we're trying to do is really important. Um now, that might sound crazy, um but I I think like you got to have a certain amount of fundamentalism in that direction of what we're trying to do with crypto, access to capital, open global financial rails, uh global permissionless um innovation.

In order to like really push those things, work with the regulator, work within um these ecosystems, I I just think it takes a different mindset. And it's not an easy ride the way in which the typical Silicon Valley companies have seen. And we're not a Silicon Valley company, right? We're we've been global remote since day one. We barely raised any capital until last year. Um so, I think it takes like a different um style and attitude. For me personally, um you know, I honestly, I don't know how to answer that question outside of I've been just doing this for so long, I don't really have any other mode. And so, a lot of people say like are you a peace time leader or um war time leader?

I've always been in war time, so I I just don't know any other mode. But for me, it's fun. It's not stressful. I like it. You know, I'm learning something. Uh I'm learning when I'm dumb. I'm learning when I make mistakes. And then if you can continue to iterate from those learnings, ideally you can pass it on to other folks. At the same time, I also know what my limitations are and then I know, you know, the types of people that I want to have around the table. What their expertise is are. And how to bring them along the way. And also just give them the ability to run. But at the same time, let them know that I'm going to micromanage the hell out of them as much as possible because that's that's how I work. But that's the same as how our co-CEO works. It's the same as how

Jesse and Ton work. Jesse is like a huge micromanager. There's probably a day that doesn't go by, given he's the chairman of the board, that we're not in constant communication about something that's happening at the company. Which is rare, right? It's not like every quarter of the board is coming around and talking to each other and and doing, you know, let's come to the principal's office and and give a report. We're extremely integrated, which is like here's how we think about risk management, here's how we think about our products, here's what we're doing on the political spectrum, here's how we're thinking about supporting new initiatives in new markets, here's how we think about a regulator. I mean, like the list just goes on. Where we want to have as many people participate in that, no matter where they are in the chain. And then the better that they do,

the more of that we want to elevate them. So our CFO, internal, our COO, internal, actually was what we call a boomerang, he came back. Um Our co-CEO was the CEO, but he's still there at the company. I'm a co-CEO, but I've been on the board for 5-plus years, investor and shareholder for a long time. So we like to make the argument, I don't know how true it is or not, but I wasn't external, I was internal, and I just came into the company because I was asked to come into the company. Um so there's no coup. Jesse and Ton are both active, they're still at the company, there's no change. And so the company hasn't really changed DNA too much. And and I think what's more important is everyone um has the same mission and value sets that they really care about. And so we've changed our

personal life in order to adhere to that. So, you can call us chameleons or we've changed our lives in order to meet that goal, but I mean Parrot is just something that I wake up with and dream about and go to sleep with and then wake up again in the morning. Like this there's no change. I love the distinction between harmony and balance. Harmony to me is a sense of one plus one is three. You know, you find work-life harmony. You know, you you end up better at both. Whereas, you know, you can you can achieve one and one being two in a balanced format, but ultimately you you regenerate re-energize rejuvenate as a result of working on on the one and they end up harmonizing together and and both are >> I'll give you an example of that and I think some people used to think it's

weird when I I used to raise capital um at Tribe Capital our our limited partners is I would just take my kids with me. Like if I didn't have time, I would say, "Do you guys just want to like go on this trip?" So, I've taken them all over the world. I've taken them to the F1 races for our sponsorship partnerships. I've taken them to meet with regulators. I've taken them to the White House because I had nothing else to do. Like I didn't want to leave them at home. I didn't want to leave them at a babysitter. I just wanted them to go. And so, I think in the beginning they thought that this is like the most boring thing possible. My oldest is 14. My youngest is not now now nine.

Um but now that it's like a part of their workflow, right? Like they know all the people that I work with. They joke around with them. They have the same lingo. Um and I don't know if it's going to be a good or bad for them. It doesn't really matter to me. It's just that they are part of that workflow. Um and the work-life harmony um uh the uh the statement it it's a it's a Bezos statement actually. Like I'm not coming up with new stuff. I'm just like reading as much as possible and then infusing it. Um you know, these are these are I don't think these are novel approaches. It's more about like how do you use it in your everyday versus just, you know, uh making a statement that you think you're using. And those experiences are entirely up to them. You know, what it

is what they make it. Um you know, we talked a lot about the intangibles and the culture of the company and how this might change as it goes public. You personally as well as the the organization as a whole. I'm just curious, you know, in in these few minutes here, you know, what are the incentives? You know, you mentioned how internally you have this uh this performance grant, if you will, this you know, idea-based uh uh you know, bonus. Uh and that could help to promote that attitude internally to the company. Um there's a lot of companies out there that have chosen not to go public. Uh they're really valuable companies. You know, you can rattle off the list, but look, a lot of the you know, largest private companies now are bigger than a lot of the public companies that are out there now. What

is the incentive to go public? So, I think the reason why then I'm going to put my Craft Capital Investor hat on. The reason why people haven't wan- wanting to go public are sort of a plethora of reasons. One is the uh quarterly disclosures and the amount of money it takes in order to be able to be a public company in the first place, right? Sarbanes-Oxley's, you know, post-2008, all the rules and regulations that I don't want to say created friction, but created enough costs in the um on the way to go public that just makes it harder. And so, what do they do? They said, "Okay, instead of being at 50 million in revenue or ARR, let's go wait till 100." Then over time it was from 100 to 250, 500, now even a billion, right? Um and so, even

companies like us, right? Like um you know, 2 billion plus in revenue, um we've chosen to stay private for as long as we have. And and frankly, we didn't even need to raise capital, so we actually had more of a dictation to you know, decide what we wanted to do. You have companies like Stripe that have said that they'll they'll never go public. And you've got companies like SpaceX that have said we'll never go public, but now have decided to go the other route. I think at the end of the day, the real answer becomes you want access to capital is one of um and access to uh debt capital markets for your company. I think for financial services companies, it becomes really important for them. In addition to that, if you're a regulated entity and um you got to, you know, give your audited

statements and financials to other regulators um all over the world, it's better to be a public company in my opinion to be able to again have access to more capital and debt markets and expand and grow in those markets. So, I don't think being a public company is for everyone, depending on, you know, it's your company at the end of the day if you're a private and how much you own of it. Um and so, our aspiration has been who are our clients and how do we serve them and what do we need to do on behalf of them and what are all the products that we have? And then along that way, in that journey, if we decide to become public, um then we will. If we decide not to, then we won't. And it's going to really depend on what do we want to have

um in terms of the products and services and offerings for our customers in any of these jurisdictions globally. Yeah. And and then with a huge decision like this, I'm just curious if you have a decision-making framework that you optimize around. Even for a a a choice as big as this, do we go public or not? Or what do I eat for lunch? What is your general decision-making framework as the co-CEO of Kraken? Uh um so, let's do the personal one first. Like um and let's like talk about food. So, I have Everyone thinks about regret minimization. But the problem with that is um you know, I drink a Coke every single day cuz I just I love the taste and I'm just going to do it. But I now have Coke

minis and I do everything possible to not drink any um I still drink alcohol, but like to minimize it as much as possible. So, I actually just mentally created a threshold, which is I'm just going to only drink expensive wine, which barely basically means I barely drink wine. Um that's one, so it helps out. Um but it's it's also like what are the types of foods that I want to eat? How do I want to spend my time during the day? And so, um I've got a tattoo that's the 86,400, which is like the amount of seconds that you have in a day. And so, I try to think about my own calculation, which is like how do I want to spend it and what do I spend it on? So, it could be family, friends, loved ones, workflow.

That's one side. On the regret minimization framework, um on the pay word side, um I don't I don't think the calculus is is ever been about, you know, should you go public or not? I think the calculus for us has always been, what are the products and services that we want to have out there? What's the speed of growth? Do we want to control our own destiny? What's the quality of the products that we want to have out there? And at any given moment, those prior prior organizations keep shifting um to make sure that they're aligned with again our values. And as long as we can continue to do what we want to do, and regardless if that's private or public, that's the route that we're going to take cuz we're thinking 5, 10, 15, 20 years out. Um that's what we're going to do. And so, the best way to uh minimize

that regret is like, do we have the road map to be able to frankly have fun building those products along the way, not being, you know, beholden to um I don't want to say a corporate style attitude, but you know, like you know in those movies you watch where like all the people in the suits are coming in and then and then and people feel weird about it or there's some sort of like friction be- between like um I don't know, modern day modern day uh bourgeoisie versus like the common people. And I and I think for us it's like, well, how do we stay as common and connected as a community and as a group of people creating really cool products as long as possible?

That's I I think like you'll see the executives and myself stay at the company that long. And if they're ever forced to do anything else, I don't I just don't think we'll be there. Yeah. Arthur, what do you um think that you'd be doing if you weren't the co-CEO of Kraken? I don't know. I mean, I just I I now today don't think of anything else. So, for me to even think about that is just it's not it's just not a part of my DNA. Before I was at Kraken, I was incubating, creating my own products. So, I'd created a uh uh uh, a bank in Mexico. So, another financial services product. I bu- I've built a bunch of protocols, a reinsurance one, some that worked, some that didn't, two biopharma companies. I I was just like like tinkering around and building stuff.

Uh, and now I'm doing all of that only within the uh, the Payoneer brand and and all the products and services. So, frankly, I just don't think about anything else until Jesse and Tom decide to fire me or something. Yeah. How much do you think about competition as it pertains to what, you know, where you should be allocating resources, decision-making versus our vision, right? Like, so for example, you know, we look at the whole landscape of media, of different markets, of different niches. You see different trends, you see, you know, different concepts that do well, but we have our audience. We have our lane, we have our education vision, we have our mission, our principles. But, you know, the the two are important for us to kind of analyze, look at, and make decisions based off

of. How much of your decision-making is on what the competition is pushing forward, where they're seeing success, and how much of it is just your product strategy, your vision? You know, I think um, this may not be an answer that you guys may like, but I I just like thinking this way. Is uh, Peter Thiel's framework, which is competition is for losers. And I think we think that way. Which is, what are we trying to build? What's our unique value proposition? And then what is our 10, 20-year arc of what we're trying to build for. I think if you take a step back and build in that direction, you stop caring about the Twitter announcement that's going to that happened last week from your competition. You stop caring about the

products that they build. It doesn't mean you don't pay attention. It doesn't mean that you don't admire some of the products that they build and say, "Hmm, should I think about adding some of these feature sets?" It doesn't mean that there are some products that are commodities with each other. It just means that we're trying to build for something long-term. And building long-term means that you have to have beliefs in the products that you've already set out and how long it takes to grow. So, I'll give you an example, X stocks. Uh we launched it a year ago. When we made the announcement, we made the announcement that we were launching the product and then we launched it and then it got to a certain size and scale. And it has it's has its abs and flows. It's it's on a what I'd call um it was on a

sublinear path. It wasn't actually going in the right direction. It was just going okay. Then it got really good and then it's back to sublinear and then it's going really well again. So, that means you have um highs and lows along the way. But, we know what where we want it to go over the next let's call it 5 years. Just like stablecoins have taken a long time to grow. And people use, you know, stablecoins as an overnight success. But, like they started eight to 10 years ago in some cases. And they had a long arc in terms of adoption, who was going to use it, how do you get customers to adopt it, what the distribution strategy was going to look like. And so, we're going through those same motions today. We have competitors in that ecosystem. So, we have a top-down, we've got a bottoms-up

strategy. But, it doesn't mean I'm going to spend a billion dollars on it, which is what I think a lot of other companies will do. This they'll spend a billion dollars and say, "We're coming out with tokenized equities." Spend a ton of money on it. And guess what happens in 6 months? How many of those same people have made announcements around tokenized equities? Where are they today? Nowhere. They've actually in some cases um you know, fired those teams or laid off those teams at like the traditional places as well as some of the exchanges. Nowhere. And what we've done is as I mentioned before, taking a very surgical approach, which is like, "Okay, where where do we have product market fit?

Let's make the investment. Let's pull back from the areas that are not working." Again, we're not always perfect. The areas that are starting to grow again, let's put more money behind it, let's find more partners. Permissionless token. We we started paid um paid word services. We call it PWS, which is funny. It's like, you know, it's a uh nomenclature on AWS. But, the reason why that's important is that a certain set of our customers want forward deployment. They want hand-holding. They want to be able to have access to liquidity. They want other solutions and services alongside our infrastructure. Great. Well, we need to build that and we need to think much further out on what those services can look like rather than say, "Oh, it didn't work. So, let me pull back. Oh, I didn't get a yield of, you know, spending $100 million on marketing and I

didn't get anything back." We just don't do that. Um and we we're never going to do that. Our whole thing is about like what's our payback period? How do we stay profitable? How do we reinvest our profits into the areas that we want? And so um uh that doesn't mean that we're always going to have like a certain um even a margin either. It just means that we're going to invest in the things we know are working, quantify it, and then put our money where our mouth is and say, "Hey guys, this is what's working." And then by the way, every time you look, every 6 months to a year, you're going to see this continue to grow. By the way, now distribution engagement's gotten to a larger scale. Monetization is now to follow me. And and here the um proof is in the pudding. That's how we

want to run the company is we want to be able to show what is actually working, what how can we quantify our engagement with our customers, and why we think it's going to have um a better opportunity for our customers. They're going to be able to grow. We're not going to extract value from them. And then how we make money along the way while our customers are successful, not the other way around. Yeah. And uh to your earlier point, that was, you know, the lessons that you learned along the way. Those are valuable uh even despite the capital you you reinvest uh and move forward accordingly. Um Arjun man, thanks for keeping it real. Uh appreciate you taking the time.

>> Yeah, thanks for having me. Yeah. I've got one last thing for you. How do you separate your self-worth from your personal perspective in your kind of life from the success of Kraken? Right? Like Kraken IPOs has a meteoric run. Everything's amazing. The company's firing. Next bear market hits, it's in the gutter. Morale's down. You've watched your illiquid value of the equity go from X to X divided by 50. You're, you know, it's just a different, you know, even if that doesn't happen, if it's happened in the past, there's ups, downs, you've been through so many bear markets and bull cycles and with your own portfolio, how do you separate your portfolio and your business success from your self-worth?

I think the I think I actually think this is a pretty important question and I I think you you see a lot of people fall into this trap is you know, you've heard this term like how do you live within your means? And of course, what happens is that you work your whole life. I I kind of categorize people in the short, medium, and long-term thinking. Short-term thinking is pretty normal when you come out of college and you need to get a job. I want to get the salary, I want to get the bonus, and that's kind of what you think. And then the word equity like you may like on average, people don't know what that means. Then it's like salary salary, bonus, and a little bit of equity, then you start learning, oh wow, what is this equity? Like I can make more money with it. Then you start

trying to seek that. The problem along the way is that you change your lifestyle as your um balance sheet grows or how much you get paid. And then what happens is a lot of people um will then start living paycheck to paycheck. You can call it keeping up with the Joneses, you want to have your kids go to the specific school, you want to get married, you want to get this ring, you want to have these experiences that you pay for. Um maybe I'm just built a little bit different, maybe I'm crazy. I don't do any of that stuff. And so my whole life as I've uh accrued value and have also gone down to zero, I've stayed in the same house.

Um I have like a very specific budget of what I spend. The things that I really care about are just my health and the food that I eat in terms of quality. And like that's my baseline and then being able to provide um at least a basic um value sets or experiences that I can provide to my kids. That's kind of how I think about it. That's not very expensive, no matter where you're living in the world um and what you pay for. And so when I think about that, I say, okay, great, do I have my cushion to be able to continue that life for the rest of my life? Yes. And so if my assets or the value of my assets go up and down and oscillate, I I just I don't care.

There's probably a little bit of like care, which is like oh I might be able to do less things, but then that just means I'll just work harder to get back to that place. And uh and and I tell a lot of these people in 2022, my net worth was getting close to let's call it close to a billion dollars with the crypto sort of going up. Uh or or right at that peak. And then when the market was going down with crypto and the value of fintech, my firm, the assets that I had, the carrying value what I was supposed to get, basically went down to almost like 4 million bucks or less. >> Holy >> Um and so that my total my total net worth had gone down to a couple million bucks. And you can say well that's something. It is It is something. I I

basically looked at that and said well look, I'm still better off than most people. I should be privileged to be in that position. So I'll just go back to working as hard as possible. Wow. That's an incredible story. Wow. So your baseline is just comfort, insulated lifestyle, and the rest is kind of the cherry on top. Uh pretty much, yeah. Yeah. Arjun Sethi, thanks for your time, man. Appreciate you having us. Thanks, Arjun. >> Yeah. Enjoy uh enjoy Bermuda. And uh yeah, have a great great rest of your conference.

Um guys, uh Arjun was our last guest of the day. So uh you closed off well. Arjun, anything any closing thoughts here to to close the day? >> No, there's too many. It's uh up to you guys to figure that away. Guys, that was live from the Digital Finance Forum day one here in Bermuda. It's been great. Tomorrow we have a full slate here on the road. We'll be live a little bit earlier around 11:00 a.m. Eastern uh time. I think we've got 10, 12 guests all anything from investors, allocators, entrepreneurs, and builders. As this world of digital assets and finance converge, Rob, great session today. Day one was a lot of fun. If it's anything uh day two's going to be day two's going to be great as well. So shout out to all

of our guests uh come for coming on today and everyone for for watching. Great co-hosting as always. And uh shout out to Bermuda for hosting a great conference. >> Thanks for Bermuda, to Near, to production team, everyone behind the scenes, as always. We'll see you guys live from Bermuda tomorrow, signing off.