Tether co-founder William Quigley on why the expected 2025 rally has not come

Transcript

GM. Good morning. Welcome to the Milk Road Show, the daily crypto show that's got the same energy as a 12 seed ready to bust brackets in March Madness. I'm your host Jay Hamilton. It's Tuesday, March the 19th, and we've got William Quigley back on the show with us. Now, we had William on a few times before on October 4th. Bitcoin was sitting around 60K. William predicted we would be at 100K by the end of the year, and we were. Then in December, William came back on and predicted 200k Bitcoin by March, April, 325K by the end of the year. So, we're maybe a little bit off track on that, but we're going to get an update from William today. See where he thinks we are in the current micro market cycle. Where is the bottom? Do we

have much more to go and what his outlook is for the rest of the year? Now, William is one of the co-founders of Tether, also co-founder of WAX Blockchain, a leading bridge technology project. So, it's always a pleasure to get him on the show. Now, before we jump in here from William, March Madness starts tomorrow and the Milk Road loves to celebrate and compete against each other. So, we've got a Milk Milk Road March Madness bracket. Make sure you hit the link in the show notes. Fill out your bracket. It's free and you can win a bunch of cool prizes worth thousands of dollars. Uh, also today's episode is brought to you by Definitive Advanced Trading on Every Chain. It's also brought to you by Coin Shift, powering top crypto treasuries with their yield bearing stable coin,

CSUSDL. Without further ado, William, welcome back to the Milk Road Show. Hey, thank you. Great to have you. Uh, okay, let's start with uh an update uh of where we've what's happened in the past few months and um what happened to our posth having bull cycle that we all thought would come. It didn't seem to play out the exact same way it's played out in past years. Or maybe you think it has and we're just slightly off. No, it definitely hasn't. And I would just say one thing. I never make predictions about where crypto prices are going.

What I do is I say if past patterns persist, then blah blah blah. Right? So, uh, if past patterns persisted, uh, Bitcoin right now would probably be at 150,000. Ethereum would be at 6 or 7,000. By April, Bitcoin would hit 200,000. Bitcoin or Ethereum would hit around 10, Bitcoin around 200. But that's only if past patterns are persistent. And, um, and I have no idea if they will be or won't. I make bets as though they will. And um I do that

because that's all we have with crypto despite what everybody would hope. Um cryptocurrencies trade on sentiment. They don't trade on profits. They don't trade on user growth adoption. They trade on sentiment. And so um what would be uh useful here I think is saying all right uh if you look at the past three havingss post the year following the having uh you had tremendous growth in Bitcoin everything follows Bitcoin right so um

uh if Bitcoin doesn't go up then none of the other tokens do either And so Bitcoin was at about 60,000 in October, 100,000 roughly in December 2024. And um and now it's bumping around between low high 70s and like maybe 90, right? Somewhere around there. And uh the part that's always hard uh for especially in in the crypto area is when we we look at news, what we think should be important news. And of course in the US that would be the amount of of uh positive rhetoric coming from the Trump

administration over you know the past month and a half. But that's not translated into anything as any real price appreciation. Uh I'm going to guess that's mostly because it's rhetoric as opposed to actual policy policy implementation. And then if we look at uh even 2020 and certainly the the havingings before that I would say uh the the monetary policy regime at that time in the world was generally quite favorable. Um and in this time around we have a very different

scenario. you know, we have high interest rates making things like uh fixed income securities relatively more attractive and we also have um a a sentiment I think in the US certainly that a recession is coming and now that institutional capital is much more important than it was let's say in 2020 and because institutional capital what we or Wall Street is um is is very quick to reduce their exposure to what are considered high-risk assets in a time of economic slowdown.

we see I think a lot of institutional capital um reducing their position in certainly Bitcoin and then and then the others and it's very hard to fight that because uh there's a lot of money in institutions uh you know we still have uh with ETFs um a hundred billion dollars of of Bitcoin traded in ETFs um six billion or so traded in Ethereum. And uh as long I think as there are concerns by Wall Street that the US economy might be slowing down,

it's going to be hard to get institutional capital to rotate back into crypto. And so for now, seems to me we're stuck in sort of a trading range. And uh you you had at the end of last year especially you had a lot of buying by um by uh uh Micro Strategy and uh it doesn't take that much it doesn't take that much uh fiat purchasing in order to drive up the prices of Bitcoin and then as I said everything's connected to that. So it seems to me uh that's the situation we are in today. There's a lot

of implications to that. Um if Bitcoin doesn't follow its prior pattern and I uh uh I think in the last time we talked I said for that to happen Bitcoin would have to at some point in 2025 hit roughly 325,000 or higher. Ethereum, the one that's even harder to imagine it would need to hit 20,000. Um, basically those those predictions though are are, you know, based on certain time frames within 2025.

So come April, as you mentioned uh just at the opening, if Bitcoin isn't at roughly 200,000, Ethereum maybe 10,000, I would say it's going to be hard for Bitcoin to hit at the end of this year or near three over 300 and and certainly for for Ethereum to get above 10,000, let alone 20. Um and everything else really follows from that. you know, you you you're not going to have a rally in the in the altcoins where Bitcoin is flat. That at least we've not seen it.

No, I mean, and certainly not this this past year when Bitcoin's been the only one that's having a rally and altcoins have been pretty much a whole bucket of shitcoins this year. And not no not many altcoin trades have done well this year unless you got in very early a few years ago when the FTX bottom right in the absolute lows, right? Yeah. Yeah. But but that means it's um people are in these these cryptos because they want extraordinarily higher returns and they accept the volatility uh as a result.

But they want those returns, very high returns relative to other traditionally traded assets. If Bitcoin and the other cryptos are not moving up that much, particularly during a period where we're expecting a bull market, then you are going to have a lot less interest from institutional capital for sure. That's why this is a um this is a pivotal year for uh for Bitcoin and and the other cryptos. If if if um this this uh year, the the post happening supposed bull market year is not interesting, if it's flat, I could see

capital rotating out because if if it did follow the patterns, we'd be waiting another four years. You know, it's a long time to wait in an asset that's so volatile. So, let's let's talk in maybe two phases. one, we're in this period of chop, as you said, we're ranging between 70 to 90 on Bitcoin, and let's just focus on Bitcoin for now, and then we can talk about some other tokens afterwards. Uh, how long do you do you think that we could be in this period of chop for? What are the catalysts or the things that you're looking for that would change us out of this this current chop and get us into I mean, ideally 100

109 and actually get us above all-time highs again and get us going again. Do you think that happens this year? Play out the rest of the year for us? Well, it's uh it it's really straightforward. There needs to be uh substantial and consistent buying of Bitcoin. You know, if you solve Bitcoin uh price problem, then everything else follows from that. That's what you need. Michael Sailor was doing that, you know, at at Micro Strategy. He was doing that in late last year. You also had a lot of institutional capital rotating in thinking okay this is this year where we should see things pop. I had played it back and forth many times with my with

my team if everybody is following the same pattern you know looking at what's happened historically. Uh how does that play out? Because everybody can't be you winning. That's not how it works. uh if everybody has the same trade, you either get a very very ugly scenario where everybody wants out or the opposite, you know, where things just go really really high and eventually you run out of new capital and then the market stutters. So, um I think nothing happens until the overall economic outlook becomes very positive. And I don't know if that's

going to happen in 2025 because um you know uh uh the Trump administration obviously everybody knows they're doing a lot of uh of renegotiations with their international partners and we've seen uh some retaliation against that and uh tariffs in in particular areas. uh stock market basically doesn't like the uh protectionist uh mindset. Now this might be very good uh for for the Trump administration. It might be good for particular groups within the US economy.

Uh certainly, you know, if you're a manufacturer and you had you had offshore competitors, this might be a good thing for you. But overall, I think the stock market doesn't like it. And until that that changes, which would basically mean a reversal of Trump's uh trade policies, I don't see the S&P rallying and therefore I don't see, you know, Bitcoin rallying. That's, you know, it's a high-risk asset and in times of uncertainty, people flock from those and they go into, you know, bonds and other things that they find more secure.

Yeah, it's it's interesting at times like this because I think to everybody in crypto, we say, "Oh, well, Bitcoin's digital gold." Well, it should be trading like gold. But in times like this, Bitcoin's still not there. We're not trading like gold. We're trading much more correlated to equities and the S&P 500. Yeah. And that that you're right and and so really we need to update that narrative because that has been the narrative, right? It's digital gold. But at the end of the day when you look at you know if you go back five years 10 years when uh Bitcoin and the other crypto were were uh really in in in very very uh limited uh holdings around the world. Most people especially

institutional capital wouldn't touch it. Uh but the idea was I remember even in 2020 talking to Wall Streeters and one of the talking points I had was how it was uncorrelated to um uh S&P 500 and other market performance. It it was very nice. It did look a lot like gold from that perspective. But uh uh what is odd is when when institutional capital buys gold, they think of it consistently as a counterweight to maybe an economic downturn or a you know time of war flight to uh a more a more protected asset that will hold its value during

economic uncertainty. Um, Bitcoin was supposed to be similar, but the reality is just Wall Street doesn't look at it that way. And, uh, despite the fact that that's what it was made for, if Wall Street doesn't look at it that way, then it becomes more like, when I think of my venture capital background, like an a recent IPO. When when the markets have been going gang busters for nine months or a year, that's when the bankers come out and say, "Take your companies public." Uh, the market is excited. It's risk on, and they're willing to take some flyers on some new technology. Um, as soon as the

market starts to slow down, the first thing to shut is the IPO window. And then uh the market starts to dump its recent IPO companies because those things haven't stood the test of time yet, right? They're they're new. And I feel like uh Bitcoin has been put into that bucket, sort of the like the recent IPO or the very high risk and potential high return bucket. And um that's why right now you just you don't see a lot of um rotation into it. Um you know the uh trading volumes haven't been

bad relative to the past but you know we peaked at about $3 trillion monthly uh for the top 10 or so uh uh exchanges in December and then we've been going down. January was like two trillion. February trillion5. Uh March is like I think it'll come in about 1.2 1.3 trillion. So we're at half the trading volume uh monthly trading volume as we were in December. So you know you can't expect a rally when when when you've cut the volume by more than half. Yeah. Let's

let's talk about your views on the US economy. So there seems to be two camps here. One camp is Trump wants a growth scare without a recession basically like let's let's get the maximum growth scare. Let's reduce stocks uh reduce the asset markets and then allow for a a setup where he can run for the rest of his presidency. Or there's others that say, "Okay, we're going into recession and and this is going to happen." Where do you sit? Where do you sit? Well, first I would say Trump has uh he hasn't said the words uh I'm okay with the recession. What he has said is we're going to have some shortterm pain. You

know, we're going to have some shortterm problems. He said that which I take to mean we may go into a recession. and uh he's he's vocalizing that and he's saying it at the same time but I'm I'm maintaining my approach my my policy approach with respect to uh um international trade and with respect to reducing federal spending. You know, the uh the federal courts have become so damn chaotic. Uh they're random federal judges are constantly trying to uh uh overturn the executive branch decisions.

Uh a lot of his attempts to to reduce the budget, I think, are being stalled as a result of that. And but you also have to understand if you you know the US uh the government is a component of GDP. So if you if you slow government spending and the private sector doesn't uh offset that then of course growth will slow as well. Um so my sense is uh the current administration is not going to do everything to keep the economy growing.

the Fed, I mean, you know, they've they've been pretty consistent. They're they're starting to reduce rates. We've cut what whatever it is, 75 basis points so far since like October. October, you know, that's But we're at between 4.25 and and 4.5%. I I'm an older guy. Those rates look amazing to me. Um I would like those rates to basically stay where they are. Um I don't like the idea certainly not going to zero but even going to two to three two and a half I I would prefer not I think these rates are are reasonable given uh you know time value of money and risk and whatnot and and I

think the US economy can easily deal with rates this high. Uh so I see though that we are we were doing really well because we pumped 8 trillion or so of um of uh monetary policy into our economy postco and that's all been for the most part absorbed and now we're uh going to have to grow based on just the traditional things that we do. Trump may get some tax legislation in though I suspect uh that will be aimed at moderate earning uh people. Uh and you know the

the the wealthy call the top 10% of of US earners drive more than half of domestic spending. So if unless you're targeting them and they feel like they have more money in their pocket, you're not going to get a lot of economic stimulus from reducing taxes on lower income or even moderate income people. So while I think that will be wellreceived by his base, I don't think that's going to do much for the economy. Uh we need true economic growth. I have a incredibly positive outlook for the US economy over the next

25 years. I think it will be extraordinarily um rewarding for companies in the United States. The end of globalization is probably a huge benefit to the United States because it is deemed a very secure place to uh to uh invest. It's a it's a very large market and a and a con and a you know a a very interesting market because it relative to the rest of the world very high earning everybody speaks the same language everybody watches the same content you know it's easy to reach uh US consumers which is why everybody likes our market um and so

that is super positive especially when you add on to that a need for massive infrastruure structure investment, you know, just regardless of the climate change stuff, we need to upgrade US national infrastructure and that'll have great benefits. So, uh I'm super positive long term, but I think we will have uh the first two years or so, you know, the Trump of the Trump administration is probably going to be pretty modest growth. So you see this this could last a few a few years. This could be Yeah. Yeah. And I and I, you know, we're in uh it's both fascinating

and scary as a crypto person that uh if we go off trend, which you know, I would say, as I keep saying, if if Bitcoin isn't at roughly 200,000 in April, I think we'll be off trend. Uh then we're in who knows, you know, that it's uh it's more random. Uh one of the things it's it's uh it's worth you know observing here is that uh we don't hear a lot about you know this word utility that used to that word used to always be associated with oh why is this going to go up utility utility um I memecoins kind of stamped any trace of that word

out of the lexicon of crypto people um uh it was becoming a bit of a fig leaf. Um anyway, because you know by my definitions of utility, I saw no recognizable pattern between that and then let's say you look at the top 100 cryptos. There's a lot of cryptos in there where the the teams have abandoned the project or the or the founders were indicted and put in jail and those things are still trading. And so, uh, uh, I think the, um, a lot of cryptos are frankly kind of memecoinish in the way they just have a

fan base. Uh, I I I might have mentioned this in the past on your program. You know, uh, uh, uh, VCs and and institutional investors, they really like to be thought of as logical, right? And that they have an investment approach. And so when I ask uh those those investors um uh you know do you think metrics matter as an investor? I mean like it's it's it's a rhetorical question. They're like absolutely great. Um how about the use of a chain? The use of a chain would that be an important metric? Absolutely.

Okay. What are the top what are you doing by usage? Yeah. you know, and it's always a blank stare like uh so I don't actually think um the institutional investors, the crypto investors really look at metrics. I think what they look at is momentum and um and that's why this could be a little scary because at least we had prior patterns in the past, right? We would say, okay, this is how it normally goes. I don't know why it does this.

It's it's like the credit cycle in the in the real world economy, but it does right now. um if we if we don't have uh the expected 2025 bull market then we won't have a lot to go on you know we we can we can turn to well let's see about adoption and you know usage but if that's if that's not something that's going to drive these u crypto prices then um I don't know what will we we may be in a period where people are just reassessing how to think about this category. Um, you know, again, if you're in an asset that's incredibly volatile,

the only reason you're willing to do that is because the upside is so high. But, you know, you're if if we have to wait another uh you know, four if we have to wait till 2028 for the next having um that's uh that's a long time to sit in a volatile asset. Um, and uh, so I'm still I'm still uh long and I'm I'm I still, you know, I love the crypto space. It's a lot more interesting to me than, you know, traditional stocks.

Um but I might have to might have to adopt a different uh approach to my investing in this area if if um this having comes and goes. Um but yeah well and you make a big a good point like our like it or not our best sales tactic or our best marketing crypto is prices going up. That is what we've what we've got so far. Yeah. Don't get me wrong, you know, I'm a bit being a a bit blasoise when I say that. Yes, we have stable coins and stable coins we believe in and obviously you believe big time in stable coins. You and I have talked about this in the past that stable coins are the bigger use case than than even

Bitcoin is and long term will be used by all monetary and fiscal systems to move money. It just makes so much sense. But but right now we're still not at the point where we have the the easy UX for the whole world to all of a sudden on board to stable coins. We're going to get legislation in the US and like that sort of stuff is going to happen. But right now we're still in this period of like we need prices to go up because that's what attracts new investors. That's what brings people into the space. And so you're a little bit concerned. Are you So it's interesting here. You're still long. Are you repositioning your portfolio? Are you hedging short right now or No, no. No, I have not. Uh I've never So I never

short. Okay. I I just constitutionally I I just I've never liked that. I uh the idea of having you know sort of a infinite loss potential uh is not even as a early stage VC that doesn't exist right we manage our our loss potential by how much money we we invest put in um so in something that's so where prices are so driven by sentiment and emotion I think shorting is uh really scary. So, I I don't short. Um and uh for me, and this is something whenever I

get together with crypto investors, we talk about this. If you were to reduce your exposure to crypto, where would you put that capital? Yeah, great question. And uh real estate is still inflated. Still inflated. Uh maybe you could maybe you could go into commercial real estate. That's not an area I really know and understand, so I'm not going to do that. And that's much less liquid. Um and then uh stocks are still quite, you know, quite expensive. The the S&P 500 uh uh Schiller PE ratio is at maybe 28.

Um you know, it's gone as high as 35, but but that's elevated, you know. In a bare market, you would like, you know, 10, 12, 13. So, we're still 2x that. So, the S&P 500 is pretty pretty darn um uh valued, highly valued. Yeah, it might not be overpriced, but might not. I don't think it's a deal. Yes. And uh and and then, you know, fixed income. So, government debt looks pretty good, right? you can get four plus percent. Um and and of course in um in private credit uh you see there's a lot of interest there. It's some it's you know

a golden age right now for private credit uh you can get six 7% on on pretty good um on pretty good uh bonds. So, uh, you know, that that's an alternative, but you know, there's no real massive upside in that type of investment either. No. So, um, I come back to what I like and what I know. Uh, there's great liquidity in, um, in crypto. Uh, but, uh, this is usually the the, you know, when springtime for for crypto, and it and it hasn't happened yet. So, um I'm still uh engaged and and deep in but uh I have to also wonder if

we don't get that bull market or let's say let's say we get to 150,000 what I would tell you uh just as an investor I would say you know you doubled your money let's say in Bitcoin uh during the bare market run or the bull market that is not enough to justify the volatility that you take on with Bitcoin and and the other cryptos even more so. It's just not enough. So, uh I hear a lot of people say, "Wow, 200,000 that would be great." Yeah, that's like a 3x from where it was prehabiting. It was like 65,000 at the happening in April 2024. So, if we got

to 200,000, I assume a lot of people would say that's great, but that's 3x. That's not enough. The reason I was looking at 5x, which is over 300,000, one, that would be kind of what the pattern would suggest it would do, but also that's sort of what you need. You need to justify it. And then Ethereum needs to do double that, you know. So, Ethereum should Ethereum's pretty risky relative to Bitcoin. So, you'd like to have 2x the potential. So um if Bitcoin needs to do 5x during the bull market then Ethereum needs to do 10x from the point uh at the beginning of the uh having and that's where I got to 20,000.

So those numbers are what it needs to be but also what we um uh should see if the past uh is um uh gonna going to be maintained. Mhm. I will give you one thing that's that's very positive for us. Um I'm a big believer in the fear and greed index. It's it's uh it's never failed, right? Never failed. When fear and greed is above 80, you should be uh holding if not uh you know reducing your exposure. when it hits 90, which would be very very greedy, you know, very bullish. Uh, you probably should be

reducing your position. It's almost certainly going to fall. Um, right now, fear and greed is low 20s, 22, 23. That is very low. And, uh, Bitcoin at whatever Bitcoin is today, 83,000, and fear and greed being at 23, that's a very nice combination. you know, if if if fear and greed were at 90 and Bitcoin were at 83, that would be awful. But, uh, it's, you know, anything below 20 is really a lot of fear and it very bearish and we've dropped below that in the last month a few times. I

think we hit 15. When it drops below 20, your audience should cheer. No one has ever lost money acquiring Bitcoin when it's dropped below 20, unless they sold it, you know, a day later. But if you have a one-year plus holding period and it drops below 20, that's incredibly positive. Um, and right now, uh, it's it's, you know, 22 23. Um, uh, basically it pretty much it's got 80 points that it can go up, only 20 down.

Uh, I like that. I think if you're holding Bitcoin right now, given that, you're in a very solid position. All right, we're just going to take a quick break to hear from our sponsors, but when we come back, William, I want to dive into Ethereum because that has become such a non- consensus trade and something that is really getting a lot of FUD. So, I want to cover that and get your thoughts on that. But quickly, we'll just hear from our sponsors who make this show possible. If you're only trading on centralized exchanges, you're not going to make it.

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CYCSUSDL is gaining traction at milkroad.com. And we're back to the show. Okay, William, ETH. Let's talk about ETH for a second because ETH is a tough tough asset. It's been been a rough I mean what bull market for ETH basically didn't have a run at all. Uh and a lot of a lot of people funding ETH but then a lot of people saying hey it's a non- consensus trade. It's feels like it could be at the bottom. It still has a lot of institutional interest. So I I'm I'm hearing a lot of views on both sides of ETH. What are your thoughts? Uh that's a good summary of my thoughts. uh you know I was uh my partner and I were

the second largest buyers in the Ethereum crowd sale in uh 2014. We've held on to our Ethereum. Uh so uh I'm forget about my words. I'm long right now. If I if I uh knew what I know now, sure I would have gotten out a year ago and maybe bought in today. uh in the last year, Bitcoin is up 30% last 12 months. So, you know, not amazing considering that next month is the uh you know, one-y year anniversary of the happening. So, up 30% pretty weak. Uh but compare that to Ethereum. Ethereum

isn't flat in the last year. It's down 40%. Mhm. Uh you know the last 90 days Bitcoin down 30% uh and uh or 15 roughly 15% but Ethereum I think is also 40% or so close to 40% the last 30 days uh or 90 days. So um relative to Bitcoin, Ethereum has performed really awfully uh and I think uh there's a lot of there was particularly because of Salana and the meme coins going on Salana and you know the old now really kind of old um

narrative that uh Ethereum is slow and expensive and it's not the right place. But if you look at things like DeFi, Ethereum is, you know, dominant. And I think if you ask most people what they feel more comfortable holding, let's say at today's prices, I know I feel much more comfortable that Ethereum isn't going to get hacked, that Ethereum is safe versus anything other than Bitcoin.

And so it does have a it's it has a now a you know launched in 2015. So so you know 10year history um it has uh an overwhelmingly larger number of developers. Uh if you you know uh ETH Denver just happened the largest Ethereum conference in uh North America. Um lot of positive energy. I think a lot of developers like building on Ethereum particularly for DeFi. Now this gets to like utility again which as we talked about earlier doesn't seem to have a whole lot of sway when it comes to pricing. I think the um the the

narrative at the institutional level is super straightforward. uh they kind of got out of it at the end of the last bull run as uh it became clear that it had a lot of technical problems. Uh the you know the surge pricing model it uses to clear the queue makes it really uh not really a great chain for any sort of bigger companies to ever adopt and use. But it's very secure and um uh its smart contract system is very welldesigned. So you you you got a lot of uh people who still like to to work on it and I think

um there will probably be some cycling back into it uh before whatever bull market happens ends. Whether that will bring us to the last cycle's high, which was around little under $5,000, I don't know. But it it would be, if I say, what would be a negative, a big negative? Um, finishing 2025 and having never gotten near its previous high of 5,000, that'd be a big negative. Uh now if there is no bull market the and and nothing really relatively does substantially better

other than you know Bitcoin maybe it's not the end of the world. Um, a legit criticism of uh Ethereum is that uh and maybe if I was working there I would feel differently but as an outsider uh it it I never have gotten the sense that the things the Ethereum Foundation funds the um the the development pipeline is is well aligned with the the desires of the crypto community. There's a lot of of uh esoteric things we do in blockchain development. Uh and you've got to do

those to keep the chain working and scaling. But then you got to throw the red meat too, right, at the audience because uh if you don't then um uh they sort of they're like, "Yeah, your your technology updates." How many times have we done a, you know, update this app thing and you're like, but nothing changed. It's all just basically housekeeping, right? Um, that is probably a problem with the foundation. Um, you know, the the the development plan just doesn't seem to be that exciting. And and you know, I I humbly say that because I built blockchains.

There's always stuff to do that nobody cares about, but that you have to do if you want to maintain the thing. Um and uh and then, you know, as I mentioned, Salana took a lot of the the gusto out of Ethereum when it uh when all the memecoin people went there. Personally, I don't think that was a positive for Salana long term. uh you know 100 million meme coins that are just junk don't really do much for the community. Um so uh last time around Ethereum really benefited from DeFi.

Uh and uh once you know DeFi is a lot about leverage and leverage happens when there's a bull market and people are feeling excited. So you could see as you mentioned sort of this this u uh uh it's sort of an investment that's out of the mainstream. You know the the conventional thinking is consensus view Ethereum's sort of a relic of history. It's going to bump around. It's never going to be interesting. I would say I I wouldn't write it off just yet.

Yeah. Yeah. It's certainly the there seems to be a lot of the FUD that you mentioned around the vision of Ethereum and their ability to communicate and to market and to get the the narrative and to get everyone excited. They haven't been able to do that as well as Salana has been able to do that and they've gotten a lot of heat for that. But they've made some changes in the foundation and the leadership. They have some old people coming back in. Danny's back. like there is a bunch of changes happening that I think we could start to see some shift. Uh I just I think I can't I can't not get away from being a bull on Ethereum as it becomes more and more bearish and more and more

non-conensus. It just it feels as you said DeFi, you know, I was just pulling up the stats here. Defi TVL Ethereum's got 54 billion today and obviously a lot of these TVLs are down from where they were 3 months ago. Uh, and Salana is is is next up at seven billion. It's not even in the same ballpark, right? So, yeah, because we all trust, we do, we trust. You get the wacko Bitcoin maxis who um, you know, I've talked long about anybody a maxi of anything where you're a zealot is not interesting to me. But they have all kinds of criticisms, but the reality is it works. And also the reality it's a 250 billion market cap

which is pretty impressive but you know that's one6th of Bitcoin's market cap which is whatever one 1.5 trillion or whatever. So yeah it's a fraction but you know if you look back six months ago uh the Ethereum ETF had um call it October 2024 uh Ethereum ETF was about a six billion market cap and about 50 million in daily trading. Not that much. uh it's uh still about 6 billion uh but its trading volume has doubled it's about 100 billion 100 million right and there have been days when it's been 600 million so um I think institutions do like it um now that compares to um uh

you know if the ETFs are about one or the uh the market cap of Ethereum is about 16th of of Bitcoin the ETFs are only 6%. It's a six billion market cap for Ethereum and it's 100 billion for Bitcoin. So, um you can kind of tell the bias there. Institutional Capital kind of thinks Ethereum is sort of irrelevant. They're they really only know one thing, which is Bitcoin. But on the flip side of that, you could say, well, that means there's a lot more that it could go up. Um, it's been sometimes a little depressing when I've listened to uh a lot of institutional investors,

crypto investors, which I've never seen because you can't see collectively what every what all of them hold, but most of them do poo poo Ethereum. You know, most of them say, uh, we have no exposure or we have very limited exposure. And uh but I look at that and say, "All right, that means there's a lot of dry powder that could get exposure, right? If everyone was heavily invested into Ethereum, that would be troubling because where is the marginal new investor going to come from?" It's it's the it's the uh it has the characteristic of what I like most. As I've mentioned uh many times, um I um I lose I've lost most of my money

investing in popular things in the consensus bets. That's where I've generally lost money. And I've almost always made money when I have invested either in out of favor assets or just neglected assets, things people just don't even bother to figure out, right? Well, Ethereum is out of favor and uh and on Wall Street, I would say it's sort of neglected. It just they people don't think of it as that important. And that means there's not a lot of downside, but if that sentiment should change, you could see a doubling much easier than let's say Bitcoin. It's not like people are unaware of Bitcoin.

Mhm. Um uh you know the institutions know what that is and they're if if they're either exposed to it at this point or or they've chosen not to be. Okay. So uh before we wrap here, William, so you you remain long, you're still long. You're unsure of the short term. You know, how much of this pain we're going to get and how long it's going to last. As you said, we're being told that we're going to get more pain. Like that's the thing that I keep reminding everybody. Trump, Scott Bessant, they're all telling us that they want more pain. So like more pain is coming. How long that is, how long this goes for, unsure. Could be a few months, could be six months, 12 months, a few years. It's difficult to predict

that. But you remain long. What we did talk about though was okay. So if in these uncertain times and when we see there's there's a move away from we talk about pumpamentals or meme coins these you know nonfunddamental coins versus the utility coins the fundamentalbased coins and there's clearly a move away right now from the casino from the meme coins right the utility isn't really there yet in the utility coins right now maybe it's coming because we do regulation coming that could lead to more buyback programs, more utility coming into place for these token holders, right? Maybe

revshare programs like there's a bunch of things that we've all talked about, but what do you do in this time right now as an investor? Are you is are there certain tokens or cryptos that you are looking at and saying, "Hey, this is where we should this is where I'm going to be allocating capital and this is where I like to be." or are you more just sort of sitting on your hands and staying long in what you're in right now? Yeah. So, well, the market cap you can't get away from, right? So, 80% of crypto market cap is two tokens, right? So, um, you're, uh, it's not, you know, the S&P 500, you've got, you know, uh, Microsoft or, you know, might have 3% 4% of of of the, uh, the total market

capitalization here. It's so overwhelming that if you have crypto exposure, you're going to have it in Bitcoin and Ethereum unless you uh I don't know, you're really sort of wild westing it and you're just going into sort of random stuff. So, those are the two big ones. And then um what we are doing is uh the majority of our holdings are in those two tokens. And then we are uh we're sector investors, right? And and we've done very well betting on sectors. And as you know, uh crypto has sectors, right? It was it was uh you know, exchange traded tokens in 2018 or

such. Uh prior to that you had the whole uh intelligent layer smart contract uh run and then of course uh DeFi and metaverse and NFTTS all came about 2020 2021. um being in a a sector that that could benefit from from some sort of uh blockchain innovation is is I think a still a smart way to go because uh there's these micro rotations within crypto. We saw a little bit of that with u with um uh AI. And what I would say to people is uh if you've been along for the ride so

far, you would not want to reduce your exposure unless you literally need the money to pay rent. But that's a reckless way to invest in crypto. You shouldn't have been investing that money in the first place. I I've never deviated from my advice on that, which is take your liquid net worth, not your house, whoever, your liquid net worth, and this is for most people, and for your audience, they'll say, "You're crazy. That's that's not enough." But too bad. Liquid net worth and one or two percent. That's literally what I tell people because that's that's how I would tell people to invest in startups and and and in venture capital. you take one two percent like and because that could wind up going up five 10x and then that's

oversized gain but unless and and a fiveyear holding period so a very small amount and a five-year holding period uh I think you're unlikely to lose if you keep if you have a five-year holding period and so my my suggestion is if you're already exposed to Bitcoin and Ethereum uh hang tight certainly through 2025 and also what sectors do you like? Personally, I think an area that I you could call this quasi utility, but people love to make money uh with their money. And this is why chasing yields, right? Going at looking at mechanisms that allow you to generate

something. Now, doing that with leverage has an untold number of risks. So, I would say unless you're very, very careful and you have stop losses, you probably don't want to do that. But, if you're already in Ethereum, you should be staking it. It's a 3% return. Why not get it, right? Um, I would never turn my crypto over to a third party to invest. uh as we saw in the last uh time around, people irresponsibly lost money uh by by people who weren't careful. Um I wouldn't do that. But um enhancing your yield uh safely, usually, let's say you own a layer 1 and you're staking your

token in that layer one, that has been pretty safe and you uh you own that token anyway. you're part of the backbone of supporting that chain. Uh that's of course how Ethereum works. Uh you're helping with proof ofstake mechanism. Uh look for that kind of that that I think that would be an area where you would see institutional capital also having interest which provides liquidity and otherwise you you have to make an assessment. Do I want to stay in crypto to some extent uh throughout the this supposed bull market run? And uh you can shift out at some point, but

I'll never not have exposure to crypto uh even as I get really old, but it'll be less and less, you know, as my u risk appetite changes. Well, you're you're in crypto, so you're just getting younger. Well, uh well well while all your friends are doing boring stuff, they're they're getting older. Uh William, absolute pleasure to get you back on the show. Really appreciate your time, uh and giving us the uh the the real talk of what's going on in this cycle and how patterns are shifting and changing and how you're positioning yourself. Really appreciate it. You're welcome. Thanks for listening in everybody. We will see you guys back again tomorrow. Before I let you go, got

to let you know about the Crypto.com card. This is one of my favorite cards in the space. If you want to spend your onchain dollars on gas and coffee and flights and whatever you're spending day-to-day, check out the Crypto.com card. No annual fees, cash back in crypto, onchain. So, you're getting cash back in crypto. Lounge access, bunch of perks. Check it out. Link is in the show description. Also, this should go without saying, but I need to remind you all that none of this is financial advice. This show is for educational purposes only. So you should do your own research. None of the views or opinions expressed in today's episode from myself or from William represent financial advice. We are not financial adviserss if you want to invest. You should always

know that there is risk associated that with crypto or wherever you're investing and you should never invest more than you're willing to lose. As William said throughout this episode, thanks again for tuning in y'all. We'll see you guys again back tomorrow. Have a wicked awesome day.