Brian Armstrong - Mining 21 Million Bitcoins, Satoshi Nakamoto and Elizabeth Warren | SRS #222

[Music]. Brian Armstrong, welcome to the show. >> Thanks for having me. >> Oh, my pleasure. I've been looking. forward to talking to you for quite some. time, so thank you for making the trip. But, uh, yeah, you have a lot of stuff. going on right now and even outside of. crypto. And we'll dive into that later. But, um, everybody starts off with an. introduction. So, here we go. Brian. Armstrong, co-founder and CEO of. Coinbase, the world's leading.

cryptocurrency exchange, a Rice. University alumnist with degrees in. computer science and economics, whose. engineering background at ARBNB and. early startup experience laid the. foundation for revolutionizing finance. visionary entrepreneur who transformed a. passion for Bitcoin into a publicly. traded company that's now part of the. S&P 500, driving economic freedom. through blockchain technology. An. advocate for free market capitalism and. crypto's role in fixing broken financial.

systems. founder of innovative ventures. beyond crypto like New Limit, which aims. to extend human health span through. epigenetic research and research hub, a. platform for open scientific. collaboration. And I just wanted to. rattle off a couple of stats here. Uh. when we were we were researching you, we. found some stats about crypto. And so. just um. just 9% of Americans are satisfied with.

the current financial system. 38% of. young people say crypto can increase. economic opportunities and crypto prices. are up 90% year-to date. >> There you go. >> It's pretty uh interesting statistics. there. So, all right. Couple things. before we get going here. So, everybody. gets a gift. >> Mhm. >> So, I got you a couple gifts.

>> Okay. >> Here's the first one. Those are vigilance gummy bears. >> All right. >> Legal in all 50 states. Not that you. have to worry about that in California, but. >> Yep. >> But, uh, >> but it's just candy, so. >> Okay. No CBD, >> no nothing. >> Great. >> Red dye and sugar, baby. That's it. >> Thank you. >> You're welcome. And. >> found out that uh you are a firearms. enthusiast.

>> So, got you a gift. >> All right. >> To add to the collection. >> All right. >> So, that's You've heard of Sig, right? Sig Sour. So, I got a friend over there. His name's Jason. >> Huge crypto guy. Okay. told him you were. coming on and he got all excited, wanted. me to give this to you. So, >> wow. >> Okay. >> So, that is the Sig Sauer P226. Legion. I think that's the that's the.

top handgun that they have right now. >> Yeah. >> And uh so just a little background on. that. You know, we were kind of talking. about my SEAL career and some firearm. stuff at breakfast. >> Yeah. So, that is the upgraded model of. what all seals were issued. And that. thing. is awesome. I think you'll really really. like that. All metal. They don't make. guns all metal anymore. Not very many of. them. >> And um and uh it's just a.

well produced. >> Thank you. >> Machine. You're welcome. >> All right. >> You like it? >> I like it. I mean, it's California. Hey, do we have to go to some federal. firearms? >> We'll handle all that stuff for you. >> The transfer part. >> We'll we'll handle that stuff for you. >> I love it. Thank you so much. You're. welcome. >> So, this is um So, how is this different. from the one you were issued in the. seals? >> So, it's So, >> are you new to shooting? I've I've been. shooting since I was growing up a little. bit here and there, but I'm not like a.

I'm not a I own a couple guns, but uh so. it's it's. pretty much it's pretty close to being. the same thing, but there's a couple of. things. So, if you look at the front. towards the barrel there, >> Yeah. >> you'll see those grooves on the top. >> Okay. >> So, that is that disperses the gas. >> which helps you stay on target faster. So, instead of your gun flipping up like. that all the time, it'll stay nice and. flat. >> Yep. Uh the trigger's been upgraded. Uh. there used to be like this decocking.

lever um on the old one, but they've. done away with that. And then one of the. things that I really like, you see that. little notch that's sticking out like. right under the ejection port? >> They call it a gas pedal. Other side. >> This? >> Yeah. Right there. So you put your thumb. on. >> That's what I was thinking. Yeah. It's. for the your Yeah. So that helps keep it. the the nose down. >> Helps you control it a lot more. >> Yeah. Cool. So yeah, it's like it's like. running a sewing machine. I love that. thing. >> What's the magazine capacity on these?

>> I believe. >> is that even allowed? And. >> I believe it's 21. Your version might be a little. different. >> Yeah, we might have to adjust those. I'm. going to take it to California. But. yeah, 9 millimeter. Okay. >> Yep. 9 millimeter. You'll love that. thing. >> Cool. Well, yeah. I don't know if we'll. have time later today, but it'd be fun. to do some shooting. So, thank you for. that. >> Hey, my pleasure. Yeah, >> pleasure. If we don't get to do it. today, maybe the next time. >> Yeah. Well, >> well, definitely the next time because. in the new studio, we've got a gun range.

literally right at you walk out the. studio. Yeah. >> And you're on a gun range. >> Yeah. >> So, >> we'll have to have you back. >> That's great. Um, I brought you a little. gift, too. You want to go for it? >> I love gifts. >> Okay, so I'll let you open that. This is a uh. one of 21. Satoshi Nakamoto commemorative cards. This is a Bitcoin credit card. Anywhere. you spend with that card, you get 4%.

back in Bitcoin. >> And um this is something uh we released. recently. >> This is awesome. >> Yeah. So, it has uh on the front there. you see a bunch of um numbers and. letters. That is a copy of the Bitcoin. Genesis block which is the first Bitcoin. block ever created. And um there's kind. of a Easter egg in there. Satoshi. Nakamoto, which nobody knows who this. is, who created Bitcoin. We can talk. about theories on who it is if you want. later, but um there's a when they.

released it in I think 2008 or nine. there there was um a headline chancellor. on the brink of bailouts uh which was. related to the the 2008 financial crisis. and they encoded that in the first. Bitcoin block and it was kind of a you. know nobody knows for sure but it seems. like a good guess that they were sort of. saying this is an answer to the the bank. bailouts and the financial crisis is. like let's create a new monetary system. And um anyway, so we encoded that right. on the front of the card and you can get. 4% cash cash back in Bitcoin anytime you.

spend with that. So. >> Oh man, thank you. Yeah, >> this is awesome. >> I appreciate that. >> Yeah, >> I think I'm going to have to have you. sign the uh the front here. We'll frame. it, put it in here. >> Okay, cool. >> All the other relics. >> Yeah, >> thank you. >> That one's kind of commemorative, but. we'll we'll get one hooked up to your. Coinbase account, too, and um send you. another one for this you could use for. day-to-day spending. So, >> thank you. >> Yeah. >> Yeah, we're framing this. Thank you. But um and yeah, I do want to talk about. who that was. >> Sure.

>> But uh all right, one last thing before. we get into the interview. So I have a. Patreon account, a subscription account. We've turned it into one hell of a. community. I think we got 90,000 people. in there now. And uh so one of the. things that uh we do is we offer them. the opportunity to ask every single. guest a question. So this is from. Achilles actual. What measures is. Coinbase taking from a cyber security. standpoint to prevent cryptocurrency. theft? Additionally, how is the company.

addressing concerns that advancements in. quantum computing could potentially. compromise blockchain security and. threaten the integrity of Bitcoin? >> Yeah. Well, great questions. Um, so. there's lots of ways that we try to. prevent theft of Bitcoin and. cryptocurrency generally. Um, first of. all, there's there's Coinbase accounts. where we store people's funds and I we. do lots of security around that which I. can talk about, but we also have a. self-custodial product. So, if people. don't want to have to trust us, they can. store their own crypto and then they're.

responsible for their own security, but. you know, it's fully in their hands. On. this on the crypto that we store for. customers, there's a few things we do. One is the vast majority of all the. customer funds are actually stored. entirely disconnected from the internet, which we call cold storage. you know. because every system can be hacked in. theory, right? That's especially these. these systems that are online. So what. we do is we actually generate these keys. in different geographic locations around. the world and there's redundancy and. consensus needed. So you might need 10.

different keys. Imagine there's some in. the west coast, the east coast, you. know, the middle of America, but also. some in London, Dublin, Singapore, Australia, like kind of ally countries. So we have these different secure. facilities like a like a skiff, you. know, if you're familiar with those from. the. >> Oh, yeah. >> Yeah. So we'll generate them in these. secure facilities. Um, and you need, let's say, five of the 10 pieces to come. together to ever move those funds. So if. half of them get lost, like let's say. there's nuclear war or there's some. accidental loss or natural disaster, you.

can lose up to half of the pe half of. the keys and still have the funds, but. no one or two people can kind of take. their piece of it and move move off with. the funds. It requires consensus to come. together. And so we've had um we then we. hire external firms to come in and try. to break into that system and pentest. it. And uh we we do audits like that. every year. So that's where the vast. majority of customer funds are stored in. these offline systems and we do this now. for governments like big financial. institutions and in the same securities.

provided to retail accounts. Um and then. for self-custodial wallets we also allow. people just to store it themselves um. like in our our new self-custodial. wallet. Uh the questioner kind of asked. about quantum as well and there's this. whole kind of area of research around. postquantum cryptography. You know, for. people who don't know that quantum. computers are this new type of really. powerful computer that can theoretically. break a lot of encryption that's out. there. And if this happens, it's bad for. crypto, but it's also bad for a whole.

bunch of other things that we use. encryption for, you know, like. >> pretty much everything. >> Yeah. Banking, you know, financial. services, military uses tons of. encryption, every everything. So. basically um these uh there are. postquantum you know cryptographic. algorithms that are out there that. people can upgrade to and the. cryptocurrency blockchains are currently. meeting they have proposals that they're. looking at about how to upgrade these. I. don't think it's going to happen in the. next 1 to two years but maybe next 3 to. 5 years it's important that we get that. done. The US government by the way they.

publish standards on this through an. organization called um NIST. I forget. the exact what it stands for, but. there's um the government has a role. here to play too to help industry up. update to these common uh postquantum. cryptography or P pqc type standards. So. Coinbase is you know if you're storing. your money with Coinbase, we're we're. going to help you make sure that it's. quantum resistant um as these computers. come online. >> So you think quantum computing will come. into play in about 5 years? >> Well, let's say I'd want to make sure we. had a solution in place before then. It.

might take 10 years, but I'd rather have. this solution in place ahead of time. because otherwise if China or someone. gets one of these things booted up, um. we might just start seeing money move. unexpectedly or communications get um. decrypted that should be sensitive. Um. we might start seeing bad things happen. So it's the kind of thing you'd want to. get ahead of. >> Mhm. Yeah. A lot of talk about that. A lot of. talk about quantum computing lately. But. um. well I'm just fascinated with innovators.

like you and uh doving into the tech. space at the beginning of the year and. so one of the thing I ju I just I like. hearing where you guys grew up what your. childhood was like and and and how you. came to. Coinbase. So let's start with where did. you grow up? Yeah, I grew up in San. Jose, California. And um my mom and dad. were both engineers, you know, my mom. was a programmer at IBM. My dad was a.

civil engineer, uh worked at Lawrence. Livermore National Lab. And um so it was. kind of a household where we focused a. lot on school academics, you know, science and math. And um both my sister. and I kind of learned a lot about that. growing up and had early computers in. the home and I was kind of like a I was. a very shy introverted kid. You know, I. was not very good at talking to people. and um but I loved computers. I just. kind of initially gravitated toward them. when we had them in the house like the.

early IBM 486 PCs and these kind of. things. So, you know, I was initially I. was like playing games on there, but I. got to learn over time about um. operating systems, some basic. programming languages, and um yeah, I. didn't really know what I wanted to do. with my life, but I was uh I was a nerd. basically, you know, I was like a total. geek kind of learning about these. things. And um what age did you start. getting interested? >> Pretty young. I mean, even in middle. school, um, I was trying to learn how to.

program computers and in high school, I. was taking some classes in that, like at. the local community college. So, I had. my normal classes for high school, but I. was kind of more interested in the the. programming classes I was taking at the. community college. And. yeah, in my free I would stay up late. like until 2:00 in the morning or 3:00. in the morning kind of um learning how. to these computers worked and then I'd. be like totally sleepd deprived for. school the next day like kind of faking. my way through these classes. So, you. know, in hindsight that should have been. a signal probably that I was more.

interested in this other thing which. they weren't teaching in school, but um. you know, we didn't have like computer. science classes at at the high school or. anything. >> What else were you into as a kid? Were. you in any sports outdoors? >> Yeah, >> just computers. >> Well, we lived next to uh this pretty. cool park, so I would I did spend a lot. of time outdoors just kind of exploring. that with my with my dog. And um you. know, I I was never like the most. athletic kid. Like I I you know, I tried.

out for like the JV tennis team and I I. was I was into like running and sort of. like um. >> just things that were more like personal. fitness, I would say, but I was never. good at like team sports and stuff. I. mean, I played a couple like inter mural. things in college and stuff, but yeah, I. was never like the most athletic kid. I. was never the most like outgoing. Um, so. I Yeah, I was pretty I was pretty. introverted. >> Right on. >> Yeah. >> Where'd you go to school? >> Well, high school or Yeah. Yeah. So, I. went to um this school called.

Bellererman uh in California, which is. it's it's a private school. It's. actually a Jesuit school. U it's all. boys. Uh it was very good academically. And they had this mission that was men. for others, right? So they actually I. didn't think too much about it at the. time while I was in school, but I. actually do think it it influenced me. like Judeo-Christian values and thinking. about how to live your life kind of to. try to create value for other people. Um. I you know at the time when I was there.

um we would have mandatory kind of like. volunteer service and different things. like that. But in as I've gotten older. in life I I I like building things that. try to advance the world be you know be. useful like how to use technology to. create better lives for people and I. doing creating companies is kind of my. way of doing that right um of trying to. create value in the world. And so I do. think it actually a Jesuit education. kind of had a big impact on me in a in a. strange way. >> Where do you go from there? >> Well, I applied to a number of different.

schools. Um, I really wanted to get out. of California cuz I I don't know. I was. I was really craving like independence, autonomy. I'd been living at home with. my parents, you know, like a lot of. young men probably. I was like, I want. to get out of here and just become my. own man, right? It was a little too. sheltered. and and so I applied to and I. I applied to like some East Coast. schools, you know, and I didn't get into. like MIT or Harvard or anything like so. I uh a couple I did apply to Rice. University in Texas um which had a good. engineering program. I and I applied to.

like Berkeley and I got in there, but I. I went and visited a couple of these. schools and I just really liked Rice. University. I had like a great. experience in their kind of uh they have. like a week you can go by there to sort. of test it out. Um so I ended up. choosing Rice University uh really good. engineering program and then and. learning about economics as well um in. that setting was really interesting too. I mean I remember like the first day of. the f you know e econ 101 kind of on.

your freshman year and the professor. said I think the very first line he said. was you know economics is the study of. scarcity right like there are finite. resources in society and so if if you. ever saying hey we should have more. teachers or more firefighters you always. kind of have to ask the question well at. the expense of what right because there. is scarcity of resources like So if you. want to have more of something, you have. to have less of something. And and you. know, they get into like supply and. demand and how to housing work. And so.

that was like a really interesting. foundation for me. And then I combined. it with computer science, which um was. really foundational just helping me. understand how technology and computers. work. And so I I had no idea what I was. going to do with my life at that time. But of course, in hindsight now, economics, computer science, like crypto. was kind of the perfect intersection of. that. >> Interesting. So I know you went to. Argentina. Was that to study? That was. uh after college and again it was me. sort of I I think I was just seeking. adventure, you know. I had I'd never.

like been in the military. I'd never. been in like a frat. I I don't know. I. always felt like I was a little too. sheltered. And so um after college, I I. had tried starting this company in the. tutoring education space and it wasn't. going that well. And I was like I just. need to I I felt like I just needed to. go abroad and like try living in a bunch. of different countries and put myself. out of my comfort zone. So I went to. Buenosarus Argentina almost like the. first stop and I was going to do like a. month in every city in a major city in. South America for like a year. But once.

I was like kind of more set up and. established in Buenosaris, I was like I. don't know. It made it became like a. home base. I didn't and I didn't want to. move every month. It was just too much. work. So I I spent about a year living. there. And did you like it down there? >> Yeah. I mean it was so in some ways it. was like quite lonely actually. Like I. didn't really know anybody. I barely. spoke the language. I was trying to. learn Spanish. There was a bunch of. expats and so you get to meet some. interesting people, but I didn't really. have that big of a friend group. So, it. was kind of lonely for like 6 months, but I eventually did start to build a.

bit of a community. One other thing that. was fascinating, again, kind of in. hindsight, this makes sense, but at the. time, I had no idea what I was doing. with my life. I was just trying to start. different companies and doing some. software consulting for people. And I. got to see a society that had gone. through hyperinflation, right? because the the currency in. Argentina has has been devalued many. times and people it affects the whole. culture, right? People get their. paycheck and they're like immediately I. want to go spend it um because it might. be worth less tomorrow, right? Or I.

remember like they had these buses that. would go around Buenosaurus and um PE, you know, you would take like coin, you'd put coins in there to like get on. the on the bus, but the currency had. been devalued so much people had to. bring like like two handfuls of coins or. something to get on there. So coins. actually became kind of scarce in. society. Um people would hoard them. Um. it also just it really destroyed I think. the culture like the people there. They're not optimistic about the future. They they they they actually kind of.

rever the past right. I think in America. we generally have more optimism about. the future even though people here say. like they get down on it sometimes with. polarization whatever but it's still. more than most places in the world. We're optimistic about the future. In. Argentina, I think people feel like, hey, it could all be gone tomorrow, and. so just like live every day like it's. your last. Have good food, good wine, good family, conversations, relationships, and that's that's fine, too. But, you know, there's an inherent. pessimism about like just kind of keep. your head down. Don't try anything too. crazy cuz, you know, the government.

might just come in and take all your. stuff. So, it was that was something I. had never seen really growing up in the. United States. And again, when when I. read the Bitcoin white paper years. later, that piece clicked there for me. I was like, "Oh my gosh, there's people. in the world who don't have access to. any kind of sound money that really. stores value. It can be it can be abused. and manipulated by the government." Um, and that's actually the default in most. countries of the world. Like the United. States historically has been a real. exception to that. And people who've. only spent time in the United States, I. think, sometimes don't they didn't.

really get crypto early on because like. what problem is this solving? You know, the dollar works fine. And the dollar. has its own challenges and with. inflation now and there's high fees and. all kinds of broken things about our. financial system, but the rest of the. world is way way worse, right? So that. was something that when I saw Bitcoin, I. was like, "Okay, this could solve a real. problem for a lot of people.". >> I mean, what what So you what was in the. white papers. >> that you read that got you all fired up. about it? >> Yeah, so the Bitcoin white paper is a. pretty fascinating document. Um, it's.

pretty complicated and it's kind of. dense for anybody who's not read it. And. it, um, you know, I read it in I think. December of 2010. Uh, I just happened to. see it on this, uh, website called. Hacker News, which like people would. just put out technical content. Um, and. it was describing how the world could. have a currency that was decentralized. No country controlled it, no company. controlled it, and but it could be. provably scarce. kind of like gold where. you couldn't just make more of it out of.

thin air. Um, and you know, you and I. could have a peer-to-peer transaction. with no intermediary in the middle like. a bank or credit card company or someone. taking fees or being able to deb. deplatform or debank one of us or, you. know, and so if you could have a. peer-to-peer cash system that was. trusted because it there was no. government or kind of company that could. go in there and manipulate it. Um I was. init I was immediately captivated by. that like I you know I had I I had been.

reading like a lot of um you know like. Ein Rand and um some of these economists. like Milton Friedman these kind of free. market guys and libertarian stuff and. the idea like really appealed to me. having seen how Argentina like these. people's lives had been destroyed by. high inflation. You know, I I was. working at Airbnb at that time, um, seeing how they were trying to move. money to 190 countries all over the. world, and it was completely broken and. slow and high fees and delays. And so, I. read that Bitcoin white paper and I was.

like, that's a that's a crazy idea. You. know, that's kind of like like the. internet or something. >> How do we have a global decentralized. network for sharing information? You. know, that the internet kicked that. whole thing off. This was describing. something kind of like the internet but. for moving value and money and all types. of assets and kind of like an internet. of money or something. And so I just. kind of couldn't stop thinking about it. for like 6 months. I I kept reading more. and more trying to get my hands on any. kind of information I could find. And. then I started going to these early. Bitcoin meetups that were happening in.

San Francisco, which was a crazy. experience of its own cuz the people who. would show up to these things in 2010. were like um some of them were like. anarchists. Uh some of them were like. computer science PhDs. Um some of them. were just like homeless people coming in. for free beer and stuff like that. It. was like it was a real mly crew of of. early people. Um, but I couldn't stop. thinking about it for six months and. that's what made me start to work on. this prototype like nights and weekends.

of what would eventually become. Coinbase. >> Interesting. Interesting. I mean, who is. Satashi Nakamoto? Who is it? >> Yeah. So, nobody knows for sure and I I. wouldn't claim to know for sure, but I. think there's a couple good theories out. there. Um, one is that there's this guy. Hal Finny who uh is a computer. scientist. um he he passed away so he's. not alive anymore. I think there's a. good good argument he's probably one of. the people that created it. Now it could.

have been multiple people that. collaborated and tried to use this. pseudonym um as kind of a you know I. think they they they knew that if this. worked that they might get hauled in. front of Congress or you know killed. >> killed. Yeah. I mean, and that and that, you know, Soshi Nakamoto, whoever that. is, or they are, um, they did mine a lot. of early Bitcoin, which is now worth a. ton of money, like I at least hundred. billion dollars or something. So, they. they knew like their family would have. to have private security and so I think.

they were thinking that far ahead. I'm. just speculating, but that could be the. case. So, anyway, Hal Finny is a good. candidate. There's another guy, Nick. Zabo, who may have been a collaborator. There might have been a third person. And um a bunch of journalists and stuff. have tried to track down these different. people who may or may not have been. Satoshi. I I think most of them got it. wrong. The most likely explanation is. it's probably Hal Finny and maybe in. collaboration with one or two people. like Nick Zabo. But um regardless of who. Satoshi actually is, the idea stands on. its own, right? It's kind of like I.

don't know like if someone had. discovered the theory of relativity uh. but that person turned out to be a bad. person or a good person whatever your. judgment of them it doesn't really. matter like the theory stands on its. own. It's a it's a genuine breakthrough. and I think that Bitcoin that white. paper is a genuine breakthrough in. computer science. It's it's the first. time that um someone was able to come up. with a a purely digital good that was. provably scarce. You know, like I'll. give you a simple example like you know, let's say you have a photo on your phone. and you can make infinite copies of it.

I you can send it to me, you can send it. to a hundred people. Like most digital. items are easy to be copied and you can. just have infinite copies of them. That's a bad property for something to. be used as money. Money needs to be. provably scarce otherwise someone can. just kind of create a ton of it out of. thin air. And so this algorithm that. they described in the Bitcoin white. paper says, "All right, we're going to. have a digital item, but we're going to. guarantee the scarcity of it." And um I. mean, if you want, I can try to describe. how that works. It's a it's it gets a.

little complicated, but like the more. the important thing to realize about it. is that at this point like thousands of. people have looked at that algorithm and. tried to break it, and no one's found a. way to break it. Um, even like, you. know, if China or like these big nation. state actors with the top resources, everything in the world, if they could. find a way to break it, they would, it's. very profitable. They would be able to. take a trillion dollars or something out. of Bitcoin. Um, no one's been able to. break it for like whatever it is, 13. years now. So, it's the longer it goes. on, the more proven it's become of how.

it's going to stand the test of time. And the mathematics behind it is is. really solid. Can you talk I mean we're talking about. printing money out of nothing. Yeah. >> Sounds familiar. >> And um Yeah. Very familiar. >> Federal Reserve. Yeah. >> And uh yeah, actually that's where I. want to go is is is. I want you to talk a little bit about. the Federal Reserve when we came off the. gold standard and and what's happened. >> Yeah. So I I think this is a fascinating.

topic if you look study history, right? And there's been obviously the America. has the reserve currency today. It's a. huge form of power for the United. States. Um, and if you look back at. history, there have been various other. empire, you know, the British and the. Dutch and going back China and various. countries at different times have had. been the global superpower and had the. reserve currency. And usually what. happens is they start off with their. currency being backed by a hard. commodity, something that is provably. scarce like like gold. And then.

eventually, usually during a time of. crisis, um these countries will quote. unquote temporarily dep from that. underlying commodity. Um and then after. a number of decades or whatever, they'll. lose discipline and and start to. overprint it and then they lose the. reserve currency status and some new one. arises. So in the US, unfortunately, dollars are no longer backed by by gold, right? That used to be the case. Um. there was a piece of it got disconnected. in like I think the 1930s uh where they.

said uh the gold's still there. You just. can't actually come in and exchange a. dollar for gold. It used to be actually. you could go in and if you gave them a. dollar they'd give you back uh I forget. some fraction of an ounce of gold in. exchange for it. They in in like the. 1930s they said trust us the gold is. still there. You just can't come and. exchange it but it's still backed by. gold. And then in in I think it was. 1971, Nixon uh during the Vietnam War, I. think they were having budget deficits. and whatnot. And he kind of said as a. temporary measure, you you can go watch. the video of this on YouTube. You know,

he literally says this is a temporary. emergency measure. It's not going to be. we're going to go back on the gold. standard soon, don't worry. Um we're. going to dep it from fully deeg it from. the gold. And that allowed them to run. these budget deficits. And of course, we. never went back. So the dollar today is. un is not backed by gold. We have. started to see more inflation happen. with the dollar. I mean that it was a. couple years ago I think it there's. different ways you could measure this, right? But it hit like eight or 9%. Um. typically they're trying to target more.

like 2 to 3%. Um but it it's like. where's where's the discipline going to. come from, right? Like if it's not. backed by a hard commodity, you know, the the temptation is always to give. people more free stuff to get elected, right? It's kind of like high school, you know, free free drinks in the. vending machine or whatever. Um, so if the dollar continues to lose. discipline like that, then the US could. lose the reserve currency status. And. you know, I think it's more likely. people actually flee to Bitcoin, gold or.

real estate, these things which are. provably scarce. Like they're not making. any more real estate. >> in the world. Uh they're not making any. more gold. They're not making any more. Bitcoin. So that's the kind of assets. that people want to go own if they're in. this environment of high inflation where. people are just printing more money. And. that's I think why we're seeing all-time. high prices of Bitcoin right now. This show is sponsored by BetterHelp. You know, work can be a stressful place.

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>> Have we lost all discipline? >> It's kind of like a big question, right? Is America in decline? I mean, I, you. know, I trust in our institutions is at. all-time lows if you look at the polls. Um, you know, I do think that the future is. not guaranteed, right? I I I there are. there are moments in history where you. have a great leader come in and and. change the course of history, right? So,

um you know, around crypto and things. like that, like President Trump has done. a lot of good stuff. Um he's we can get. into this whenever you want, but I mean. there was a whole war being waged on. crypto in the last administration which. we had to fight back against to protect. >> Yeah. Get into it. Let's get into that. >> Yeah. But I maybe I'm just trying to. think about your broader It's a big one. Like I mean. I hope America is not in decline, right? I like America is such a unique thing. historically um to have a land where you. actually have these freedoms and.

democracy and whatnot. Like it would be. a damn shame, right? If if America. starts to fall where who's going to take. up the mantle, right? Like I I I don't. think China is aligned with our values. on that economically or in other ways. Um so it would be bad for the world if. America really is in decline. I think we. we got to try to save it. But we we can. also have um alternatives, right? Like. Bitcoin can come up or maybe we'll have. Mars. Maybe we we special economic zones. within the US. We can talk about all. kinds of stuff. I love to talk about. this with my friends, but.

>> but yeah, you want to jump to the the. war crypto? >> I mean, I don't I don't. I don't think America's in decline. I. think we're at a very pivotal moment. where if we don't turn the ship around, then we're probably going to be entering. decline. Yeah. >> Very quickly. >> Yeah. And we've been through some crazy. [ __ ] before, right? I mean, yeah. The. 60s and all that. And then we also. landed a man on the moon, right? So, yeah. America seems to be, no matter how.

screwed up America is, it's like. everywhere else is kind of worse. So, that's kind of where I was going, too. >> Yeah. >> I mean, we have the best innovators in. the world. They've been I mean I'm sure. you you're going to relate to this but I. mean like I said I've dove into the tech. space and I've talked to a lot of. innovators and the one thing I will say. man is that all of them are really fired. up about the current administration and. getting rid of some of the bureaucracy. everybody in in power and AI and all. everything. Every everybody seems to be.

gung-ho about this administration kind. of gutting the bureaucracy a little bit. and letting the innovators innovate and. and and change the world. >> Yeah, I'm all for it. I mean that's how. we that's how we build a better future. is we've got to get rid of the. bureaucracy like deregulate you know. allow people to build power plants like. nuclear fusion you know we should have. like supersonic jets like accelerate. biotech um it's you know it takes like. 10 years and$2 billion to get a drug to.

market now so it's like every every year. you wait you know people are dying right. >> um so that the mentality of if you. overregulate you can kind be so safety. oriented, but then you you just freeze. in time, right? Um like air travel is. pretty safe. Um. >> used to be. >> Yeah, that's true. Some some gaps in. that maybe recently. Um but overall it's. pretty safe. And then but like the jets. literally look the same as they did in.

the 60s and none of them can fly faster. than 600 miles an hour. Um, so that's. not what to me that's not what America's. strength is about like is freedom, you. know, free markets, small government. Um, in my view like the government. really should just be there to kind of. run the military, protect from foreign. invaders, you know, run the police, protect u enforce the laws at home and. and run the courts and like adjudicate. disputes. And I think pretty much.

everything else like the private market. would would better uh solve those. issues, right? Um. and you know, education, healthcare, like going down the list and you should. you know it's it's a it's a philosophy. of more like personal responsibility and. like thing non there are non-government. solutions to things in society, right? like private charities, you know, um. churches, like the f the family unit, like these kind of things can create. that structure and safety net in.

society. Um the government doesn't have. the incentives aligned to create good. outcomes typically because there's no. competition. You know, like competition. breeds excellence. Um and if the. government is the only game in town, it just it just deteriorates over time. So the incentives aren't aligned for the. government to do good things. They. should be small, focused on what they. they have to do, the monopoly on. violence, and then let the free market. cook. And I think that would be a. stronger America. Me too. Me too. So. what's what's the war on crypto? I'm not.

>> Yeah, >> I can't say I'm not a crypto guy cuz I. buy it. Even though I don't understand I. don't I don't understand it uh nearly to. your level. But. why would there be a war on crypto? >> Yeah. Well, crypto is a threat to um. some people in power, right? Um you. know, in particular, like in this last. administration, Elizabeth Warren and. Gary Gendler, I would say, were the.

biggest uh architects of this war on. crypto. And you know, Elizabeth Warren. is a socialist. She basically thinks the. government should run all financial. services. um and she likes to apply. pressure to the big banks that are kind. of under the purview of these financial. regulators to get stuff done that she. can't get done through Congress because. the American people don't want it. So, as an example, um she put a lot of pressure on JP. Morgan to say, you know, don't give. loans to oil and gas companies or to gun.

companies. Um, and so she has these kind. of political motivations and she can. because she can't get them passed. through Congress because the American. people don't want that. She'll kind of. in an extrajudicial kind of way uh. appoint these financial service. regulators and those regulators will go. into the bank and say, "Hey, it would be. a real shame if you were to do this.". You know, they have a lot of soft power. They can say, "Hey, we're going to come. in and audit you once a once a month. instead of once a year and ask you to. produce thousands of pages of. documentation." And you know if you. upset your regulator, you know, you can.

be in the penalty box for years and. years, right? So this kind of soft. power, you know, we called it like. operation chokepoint 2.0. They would. they'd go into the banks and try to. debank people that they didn't like for. their political reasons. And so crypto. comes along totally outside the power. structure that they've been able to. infiltrate. Um, and it allows people to. kind of do financial transactions. without the risk of being shut off by. your bank. And so she hates she hates.

crypto. And it's like it's pure. hypocrisy, too, because she's always. kind of out there saying, "Well, you. know, I we're here about consumer. protection. I'm trying to protect the. little guy." And the minute, you know, like some legislation gets proposed for. crypto that would protect the little. guy, she'll fight against it like tooth. and nail. So anyway, long story short, she appointed this guy, Gary Gendler, to. be the SEC chair as the head of the. Securities and Exchange Commission, and. he's just he's like a powerful financial. services regulator. And what members of.

Congress told me was that um she made a. deal with him. He he really wanted to be. Treasury Secretary, but she said, "Hey, look, in the first term of the Biden. administration, do do the SEC chair. role. Uh go hard on crypto. try to try. to really tamp down on this stuff and if. you do a good job, I'll try to make you. Treasury Secretary in the second Biden. term. And so he really wanted this job. um to be Treasury Secretary. So he he's. a smart guy, by the way. If you go back. and look at his talks before he became. the SEC chair, he he's he was teaching. these classes at MIT about how great.

crypto was and how it's such a powerful. technology to update the financial. system and all this. >> Are you serious? >> Yeah. He totally flopped. >> He he totally flip-flopped. Yeah, I. think. >> just for a job. >> I think these guys like they're just. somehow they're mentally willing to, you. know, change. their values and what they will do to. it's for basically for personal. advancement, right, to get the job he. wants. And so, you know, he went in. there and started creating all this. lawfare essentially against crypto.

companies. And um like for us, we had. gone public in 2021. As part of becoming. a public company, you have to disclose. all this information to the SEC. They. asked they send you like a bunch of. comment letters back and forth like they. sort of turn over every stone. They they. understand everything about your company. and they allowed us to become a public. company at that time in 2021. And they. said, "Okay, great. You're good. You the. public mark the public re, you know, consumers can own your stock and it's. you're good, kosher." And then a few. years later after this pressure from. Elizabeth Warren, he decided, you know. what, actually, we don't like all this.

stuff. And they started sending us these. really nasty letters like, "Hey, we have. deep concerns about all these things. you're doing that they had just approve, you know, allowed us to become a public. company doing." Um, and so our lawyers, you know, we went in, we met with them. probably at the SEC like 30 times over a. period of a year or two and we just. tried to be helpful and answer all their. questions and you know, and we would ask. them sometimes we'd ask the regulators. should be giving you a clear rule book, right? Like here here are the rules you. have to follow and then we follow them. and that's that's how it should work,

right? They wouldn't they wouldn't give. us any rules to follow. And our our. lawyers, I remember we would ask them in. these meetings like, "Well, here's how. we think about it. we read the law and. here's the program we designed in. compliance with the law. Uh do you have. any feedback for us? And they'd say, "We're not going to give you legal. advice." Um and we'd say, "Okay, well, are we doing anything wrong?" And. they're like, "We're not going to give. you legal advice." And then after 30. meetings, they hit us with a lawsuit uh. claiming we had violated all these laws.

And so that was like a pretty. interesting moment as a CEO because. normally most people would tell you. never engage in litigation with your. regulator, you know, it's like they can. make your life hell, right? Um, and I. made a decision at that point. I was. like, we got to fight this, you know, because I was like, show me in the law. where we're did we violate any rule? They couldn't point to anything, but. they said, you have to stop all this. activity that you're doing. And I kind. of felt like if we just complied with. that, it would not only hurt our.

business, it would actually kill the. entire crypto industry in America. And a. lot of this stuff had been going. offshore anyway. You might have read. about like FTX, this exchange, and Mount. Gaus and like these things. American. consumers were using these offshore. platforms which were then blowing up and. stealing people's money. >> And so I was like, really? we're just. going to seed this entire industry to. foreign companies and not have the. future of technology and financial. services be built in the US. Screw that. Like let's go fight these guys because I. think we have the better argument. Now.

that of course litigation takes a long. time, right? So for a period of couple. years um we were engaged in litigation. with the SEC. It it had a massive. depression on our stock price because a. lot of public market investors will just. oh you're suing the SEC. O this is too. risky. I'm not going to go near that. stock. And they they kind of played. dirty. Like they pressured um these. different companies not to work with us. And they would they said. >> what companies? >> Um like we were trying to close deals. with, you know, big banks and um to. plat, you know, to get money moving onto.

our platform. And they would the SEC. would go meet with them and and tell. them, hey, you know, that company. Coinbase is uh under investigation. Like. we don't think you should work with. them. Wait, are you talking like like. when I go into Coinbase and I want to, you know, put in money from my bank. account, is that is that what they were. trying to stop? Linking bank accounts to. Coinbase? >> I mean, to be honest, I was worried. about getting like personal criminal. charges because um some people I talked. to, like my lawyers and stuff, they. said, >> you know, this is a civil lawsuit where. they they think maybe the company had.

some technical violation, but um they'll. like it's not unheard of where they. actually would put personal criminal. charges on you, even if they're totally. bogus. um just to try to pressure you to. settle the other case, right? And so um. you know, I was prepared for that to. happen if it was if it was going to go. there, but it luckily it didn't. And um. you know, these guys basically the once. um the Trump administration came in and. um they appointed a new SEC chair, he. looked at these cases and he just threw. them all out. Like he he just was like,

"This is ridiculous." And so that case. got luckily this this year, I think it. just got um totally withdrawn. We didn't. we didn't pay a single dollar in. penalties. We didn't have to change a. single thing about our business. It was. like pure lawfare. They were they were. just like harassing us with these bogus. lawsuits to try to kill the industry. And a lot of start we luckily we had. deep enough pockets where we could pay. these lawyer we we probably spent like. $50 million on lawyer fees. Um we had. the money to do it but a lot of startups. died because of this in the United. States. They like I know a lot of.

founders who their companies just shut. down because they couldn't deal with the. legal costs of the SEC suing them. So, it was pretty messed up. >> I mean, I I got to commend you here. That takes some serious balls to go. after the SEC. >> Yeah. I mean, people told me I was crazy. to do it, but um. I mean, I'm so glad we did because like. the crypto industry might not exist in. the United States if today if we had. caved on that. >> Yeah. >> Um and we and we did it at great.

personal cost as well. Um. >> Wow. And that took how many years? It. took about I think two or two and a half. years to resolve. Um. and yeah, it was like $50 or hundred. million dollars in direct legal fees, but then yeah, our stock price was down. in the gutter too for a long time. Um so. yeah, it was a huge setback for America. And I I sort of joked with some people. that, you know, after being SEC chair,

Gary Gendler should go run the economic. development board for like the UAE or. the Bahamas or something because he. literally just he grew their economies. enormously because a lot of the crypto. businesses moved offshore outside the. United States and set up shop there and. he he created all these jobs offshore, you know. Um. anyway, >> well, it turned into a huge win. So, >> yeah, at least in my eyes. I mean the. positive of it is that we learned how to. become very politically engaged as a as. an industry. I mean I was sort of.

telling you at breakfast right like I. naively coming into starting a company I. kind of thought and I I I was always. kind of apolitical and I was like I. didn't really want to engage in. government stuff and I was just like all. right well if we just follow the law we. don't have to deal with DC and a bunch. of policy stuff right but it turns out. even if you're not interested in. politics politics is interested in you. and they occasionally they'll come try. to unlawfully kill your whole company. So then we realized, you know, I give. Mark Andre and some of these guys on our. board a lot of credit for this, but they. were like, we have to help our customers.

and develop political power. Like we we. had, you know, we had um tens of. millions of customers in the United. States. We're like, how do we organize. these people? These are these are. voters, right? And so we actually got um. we created this grassroots campaign. called standwithcrypto.org and it was a. 501c4. We got about 2 million Americans. in this last election to raise their. hand and said they want to elect pro-. crypto candidates and we created like. scorecards for all the different members. of Congress and everything. And um so. about 2 million of those voters showed.

up in this last election and we now have. the most pro- crypto congress ever. So I. was that was something where I had never. really engaged politically before. But. you know we there has to be real. consequences, right? Like if you have a. member of Congress who's out there. trying to kill crypto and that's not. what the American people want, um they. got to lose their job for for the rest. somebody in DC to wake up and oh my. gosh, this is like a this is a risk. politically for me to be against this. thing. So um that's exactly what we did. in this last election and I think it had.

a big impact. So, >> I mean, you you set up, correct me if. I'm wrong, but you set up a fund. You've. got is it $140 million set aside for pro. crypto candidates. >> Yeah. Yeah. That's a. >> doesn't matter what side they lean. Yeah. >> That's that's the goal. >> It's bipartisan. Um that's a pack that. we help we were involved in along with a. bunch of other people in the industry. called Fairshake. So, yeah, it's got a. bunch of money and they're helping elect. pro crypto candidates. Yeah. >> How's that? I mean, have you got anybody.

unseated in in the Senate or in Congress. for going against crypto? >> Yeah. So, the I mean, the most notable. one was that um in this last election in. November, um Sherid Brown was the. sitting uh member. He was chairing of. the Senate Banking Committee and he was. super anti-crypto. I I flew to DC. probably like three or four times trying. to meet with this guy. He would never. take a meeting with me. We flew in a. bunch of entrepreneurs from his state, I. Ohio, like cryp crypto and blockchain. entrepreneurs. This was during an. election year and I was like, "Hey,

maybe if you won't meet with me, he'll. meet with people from his state trying. to build build businesses, right?" He he. refused to meet with them. Didn't show. up. And he was just blocking every time. we were saying, "Look, the SEC and. Elizabeth Warner are trying to kill our. whole industry unlawfully. Like, can we. talk about getting some real legislation. passed that would protect consumers and. allow the industry to be built here?" He. would never meet, right? And he would. he'd block every attempt at legislation. So he was up by about 11% in going into. the polls going into November um sitting.

member of Congress like very senior. member of Congress and there was a guy. running against him Bernie Marino and we. we and the crypto community decided to. like back this guy Bernie Marino and uh. he went from being down by 11 points to. winning the election. Um I I can't. remember by how much but it was that was. a huge upset that sent like shock waves. through DC where people are like oh my. gosh like shared brown the sitting. senator like got kicked out because of. the crypto industry and you know I think.

that woke a lot of people up and there. was probably like a dozen other races. that we played in in the House and the. Senate. Um most of them I can't remember. what percentage it was but it was like. an 80 80 or 90% win rate. Um, yeah. And. so people, >> congratulations. >> But people realized in DC there's like. there's no constituency that wants to. vote. If you're anti-crypto, nobody. really cares. But if you're pro- crypto, you can get a lot of votes. Like the the. American people want this. So it's just. bad politics to be anti-crypto. >> Have you had anybody that that that told.

you that they would be pro crypto and. then flipped? >> Um, we've had some people that were a. little wishy-washy. Yeah. Like there was. a couple people we called it like a. foxhole conversion, you know, like um. like right before the election, they'd. suddenly be saying a lot of pro crypto. stuff, but they had been saying. anti-crypto stuff previously. Um. and then. you know I Maxine Waters is like a very. interesting person. um she I spent a. bunch of time with her trying to like.

get her educated on this and she was. always like really nice to me to my face. and then um we donated money to her and. all this stuff which was probably a. terrible mistake. Um but yeah I when. when this crypto bill came up um there's. been a couple of them one of them just. got passed into law. She would like go. out on the the house floor and talk. about like how terrible Coinbase is as a. company and I was like, "Damn, Maxi, I. spent all this time like with you. You. were so nice to my face." And suddenly. she's like, "Yeah, she she she flipped.".

Yeah. I I don't think she's going to. she's not going to be pro crypto. I. mean, how do you. how do you educate. congressmen, senators, anybody, appointees, anybody at government, especially I mean, we're dealing with a. lot of dinosaurs up there. You got I. mean, we we have people stroking out on. camera. We have people dying in office. We have people with dementia. Like, how. do you Cuz I don't even understand it.

fully. And I I mean I just interviewed. Charles Hoskinson. Yeah. >> Awesome human, >> but I still don't get it 100%. And so. yeah, >> if I don't get it, how do how do you get. it to somebody that's a dinosaur in. government? I mean, how do you you. educate them? >> Yeah. Well, this is definitely a bit of. a generational issue. like the a lot of. times I'll meet members of Congress that. are like over 70 and they don't really. get exactly but all their staff have the. Coinbase app or you know their kids have.

the Coinbase app. >> Um. and it's it's okay like if I was in. their shoes I you know they're like a. mile wide inch deep, right? They need to. know a little bit about everything. um. school choice and healthcare and. supersonic jets and you know so they're. constantly have a stream of people. coming into their office every day. trying to tell them about their local. thing that they care a lot about. So I. get it why they're not like experts and. everything. I don't think I could be. either. Um and so they have to rely a. little bit on their staff and a little. bit on just good general principles like.

do we think the government should be. building more stuff or like the free. market, right? Or there's various. principles like that you could fall back. on. And I one thing I realized actually. having I don't know probably like five. or six years ago I started going to DC. like once a quarter to try to build. these relationships because I knew the. policy thing was going to be important. Initially we started off just trying to. be an educational resource and it kind. of it didn't really work that well. I I. was I think I was sort of naive about. what how DC worked cuz I'd go in there. and I'd tell them I'd try to be helpful.

and answer their questions and and. they'd kind of pat me on the head and be. like, "Okay, thank you for coming in.". I'd leave and nothing would ever happen. Right. And it wasn't until we actually. got like political power like or. organized the millions of Americans who. were using crypto like with real votes. that could that could get someone. elected or you know have them lose an. election. And it wasn't until I think. the political power is what really woke. them up and like okay we need to get. this done cuz a lot of these folks in. Congress like not not to be too cynical. about it. I think a lot of them are like. really hardworking Americans that want.

to do something good, but a lot of them. are also they're just trying to stay in. power, you know, and like to stay in. power, you have a finite amount of. things you can focus on at any given. time. And so it's kind of like who has a. bunch of votes, who has a bunch of. money. Um, you got to kind of focus on. that and be, you know, you kind of want. to be for the thing that's going to. happen. Um, and nobody wants to stick. their neck out for some kind of pet. issue that's not going to decide an. election one way or the other. And so it.

wasn't until we actually got the crypto. industry organized to protect our. customers rights that they started to. take us more seriously. I mean, what do what do you tell them. though? What do I mean? Because. especially with some of these. some the older generations in. government, I mean, I can't see any of. them wanting. to move to crypto. >> Yeah. Yeah. Well, in many ways, you're right. I mean, crypto is about individual.

freedom and sovereignty. Like, it's not. if you want more power in the. government, like it's a little unclear. why, you know, but the people want it, right? So the things that we usually. talk to them about are this is a. technology to update the financial. system, right? Like your average uh. consumer and American or citizen like. you talked about those stats at the. beginning, right? Like vast majority of. Americans think the financial system is. not really working for them, right? Like. the fees are super high. You you get. like these overdraft fees, right? It's. hard to send money in certain ways. Like.

um you know, you can get debanked or. there's unequal access. like there's a. whole bunch of people who are. underbanked or you know can't get a bank. account or get access to a loan or these. things that just you know so if you look. at the how satisfied pe Americans are. with the financial system it's very low. >> so we tell them that crypto is a. technology that can update that it can. make um payments faster and cheaper and. more global it can give people better. rewards on their money like you know. right now the average savings account in. America it pays you 0.14%.

um what you should be getting like four. and a half percent. That's what the US. treasuries are paying. So like that. should just be riving into your your. checking account. Why doesn't every. American have that? There's all these. kind of and like it doesn't you know the. banks don't the payments don't really. work on the weekends and you know the. stock market doesn't work on the. weekend. So there's all these kind of. like legacy systems that are just kind. of there because they've they've been. there for 30 years. Um and they they. they're oified. They have no incentive. to really improve. And so crypto is. coming along and updating the financial.

system, making better financial services. for everybody, empowering them uh with. sound money that can't be inflated away, and it can do it for everybody in the. world with just a smartphone, right? Connect them into this global economy. >> So that's appealing to many of them. I. also we talk a lot about like the. national security arguments, right? Especially for people on the right, how. the a digital dollar is essential to. ensuring it m it maintains like its. reserve currency status. um how we want. these industries to be built in America. Um, I mean, imagine if like the big.

internet companies were built overseas. >> like that. Google and, you know, Amazon. and all these things. People have their. quibbles with them, but like I'd much. rather those companies were built in. America under the US system than to be. built in China. We were all using a. Chinese search engine, right? >> So, if the internet companies had been. built offshore, that would be a huge. loss to America. Okay, let's make sure. the crypto companies are built on shore. as well. Once in a while, these things. get away from us. Like, you know, 5G or. semiconductors now are all being made.

offshore. And it's a big issue in DC. Everyone's like, well, we can't be. buying our 5G routers from Huawei, maybe. the Chinese company, or the. semiconductors are all made in Taiwan, and this is a huge national security. risk. They're all trying to now. scrambling and throwing hundred billion. dollars to try to bring these things. back on shore. It's like, well, hey, let's just not lose it in the first. place, you know? Yeah. >> Um, so those are the kind of arguments. we make to folks and it's generally. pretty compelling. Like this theong. Congress is now there's a strong.

bipartisan majority that wants the. industry to be built here in America. partially because of this last election. Um, and actually they just passed uh. this piece of crypto legislation last. Friday. I was at the White House doing. that signing ceremony. Um, that was a. huge step in the right direction. And. then there's there's one more bill that. hopefully will get passed um in. September, October of this year. We'll. get into those in a little bit. But, you. know, I wanted to ask you, we we were. talking about money. We were talking. about the Federal Reserve coming off the. gold standard, real estate, how how how.

currencies can be tied to commodities. And so, I I just wanted to ask you, I. mean, what is money to you? >> Yeah. Well, to me, money is really like. a medium of exchange. Um, and it came. out of this need from uh the barter. system not fully working, right? like if. I if I grow apples and you raise beef. and I kind of want some beef but you you. don't need my apples right now, you got. enough apples. It's like that's a. barrier to a trade happening, right? So, it helps if we have this common medium. of exchange um that can be used to price.

things and just um allow a transaction. to happen even if you don't need the. exact good that I produce, right? And. you know over time lots of things have. been used as money, right? Like people. used salt as money at one point. uh in. prisons, people use like cigarettes or. different food items as money. Um. seashells, you know, famously all all. these like kind of things. And there's. certain properties of money that make it. good money or bad money, right? Like. like scarcity is one of those. Um can. people just if can you just find a bunch.

more seashells on the on the on the. beach, then that's like a bad form of. money, right? Or durability, like you know, will the will the thing. deteriorate over time? like bread or. something like that is probably like a. bad form of currency because it just it. goes bad. It rots, right? Um how. portable is it? Like you know a bar of. gold is great as like a store of value, which by the way is another good. property of money, but it's hard to move. gold. Like if I need to pay somebody in. Japan, like I need to fly that bar of. gold, right? Um or how subdivisible is.

it, right? Can it can I like chip off a. little flake of gold to pay for my. coffee or you know so people look at. these different properties of money and. you can kind of score score different. monies and like this is partly why I. think Bitcoin is probably the best form. of money that's ever created because it. is scarce uh provably scarce just like. gold or something like that um but it's. more portable than gold. You can send a. Bitcoin transaction um kind of anywhere. in the world pretty quickly. Um, it's.

subdivisible down to like eight decimal. places. Um, you know, it's very durable. It's not going to go bad or And it's. it's like uh it's fungeible, too. Like, you know, that um if I have one Bitcoin, it's just as good as another Bitcoin, right? Like some, you know, imagine if. you had like different purities of. metals and like, oh, is this one diluted. a little bit or like are they hiding. some lead in there, you know? Um, so. yeah, I think you could think of Bitcoin.

as like a digital gold. Um, and it's it. has some of the best properties of gold, but some of the ones that gold doesn't. have too, like the portability and. subdivisibility. The programmability too. a little I would say you can use it in. different ca in different um set up. different contracts with it and things. like that. So that's kind of what money. is to me. It's it's intended to be a. medium of exchange. and uh I think crypto is really. providing a better alternative on that. dimension. >> I mean you know the big argument and I.

listen to a lot of people um that I. respect one one Dave Ramsey. Are you. familiar with Dave? >> Yeah I think so. Yeah. He's he's a good. friend of mine and uh big finance guy. does not like crypto le unless he's. changed his mind in the last I don't. know year but you know and he says it's. backed by nothing. >> Mhm. >> And so you know is that's kind of where. I'm going is what.

yes there's a there's a limited amount. of crypto. It's never going to go over I. can't remember how many coins. >> 21 million. Yeah. >> 21 million coins. But what what actually like what why do. people value it? >> Yeah. Well, he's right. I I don't think. it's necessarily backed by anything. Um. but neither is the dollar. >> We talked about it's no longer backed by. gold. >> Um well, you know, are Picasso paintings. backed by anything? >> Not really. I mean, they're just paint. on some canvas. There's not like an.

intrinsic value to it. People value gold. or Caso paintings or Bitcoin because. they are scarce. Um and other people. believe they have value. It it really. comes down to um trust, right? And a lot. of things contribute to trust like the. fact that Satoshi Nakamoto kind of put. out this white paper and allowed anybody. in the world to mine it. So it was kind. of like a a fair way to launch it into. the world that created a lot of trust.

um the fact that no government or. anybody's been able to hack it or break. the algorithm behind Bitcoin that. created a lot of trust. So. >> do you think that the energy required to. mine Bitcoin is. possibly a backer? >> Yeah. I mean so you could make an. >> money to mine it. Yeah. >> Your energy prices. >> I think if you were to make an argument. that it is backed by something um Yeah. Yeah. So there's a lot of energy and. hashing computing power that goes into.

verifying the network. So that makes it. defensible against somebody trying to. take it over. I I think you could say. another like what is the intrinsic value. of it is another question people ask. sometime. And the way the value of it is. that it allows you to instantly transfer. value anywhere in the world on a. decentralized ledger, right? Like so. these are kind of philosophical. arguments though. Sometimes people get. really wrapped around the actual of. like, yeah, but that's not it's not. really backed by anything. And so I. don't know. I just like to kind of.

concede that point. I'm like, okay, just. let's take it. Let's just say that it's. not backed by anything, but that's true. of the dollar and Picasso paintings and. all. So to me, that's not like um you. know, you can't like discount Bitcoin. just because of that. If people trust it. and believe it has value and it's. provably scarce, >> that's all you need. What are some of. the other coins out there that that. people transact in or is Bitcoin the I. mean is Bitcoin the primary? I I know. it's the primary one but. >> you got all these other ones that have.

popped up, you know, Cardano, Ethereum, >> Salana, >> XRP, Salana. I mean there's I mean I. don't know how many there are. There's. probably thousands. And then we saw the. stuff with Doge, you know, and Elon. >> Yeah. >> Do am I saying that right? coin and and. and. like I I think it was like early 2020. I. was like buying all just buying all. kinds of [ __ ] that I had no idea what it. does. >> And you'd see these crazy spikes, >> you know, both up and down.

>> What what are what are people using? What is what are the reasons people. would hold some of these other coins? >> Yeah. So, crypto is not just one thing, right? like Bitcoin is digital gold, but. there's other blockchains that are. really trying to be like um the payment. layer, the the utility layer um for. crypto. So that's kind of what Ethereum. and Salana are doing. And actually, so. those are like I would call those. blockchains. There's co there's like. millions of coins built on top of these. blockchains. Um so you could have.

someone might be like, why would there. be like millions of these things, right? Um and if they if you're thinking about. it in terms of currency or money, you. probably only need like one or two of. those, right? But if you're if you're. thinking about it as, hey, this company. might need to raise money or um this. social media po post like this piece of. artwork or content or podcast episode or. whatever it that's that's how you're. getting millions of these coins actually. coming out. And so this is kind of where. crypto is now on the frontier. Bitcoin. is like digital gold. There's USDC which.

is like a digital dollar. That's like. people spending dollars digitally faster. and cheaper, more global. And now. there's people every social media post. whether it's like text or audio or video. that could be a coin or like you know. you. >> what do you mean by that? Well, like if. you put out this uh this episode, right? Um you know, today you have like. sponsors on the podcast, right? And you. know, that's how you have kind of have. to monetize it is like a certain number. of eyeballs and you sell sponsorship.

But what if people who love your podcast. or on your Patreon or wherever like. maybe they want to own a copy of this. this episode, right? Or the next uh song. that gets put out by some famous. musician, right? People want to own a. copy of that song. like people are. actually they can buy directly from the. creators um in this new model for. crypto. So it's actually crypto started. as like digital gold with Bitcoin. Then. it started to update different kinds of. financial services like payments,

borrowing and lending, trading. And now. what it's doing is it's actually. updating the way these applications. monetize on the internet like all even. things that aren't directly related to. financial services like like podcasts or. you know video or audio like there's. going to be a version of like YouTube, Spotify. >> Is this like NFTTS? >> It's similar. Yeah. So these things keep. coming in waves, but the early version. of it was NFTts. Uh, exactly. That were. like pieces of artwork, but this those. were kind of like baseball cards or. collectibles people would want to own. that was like a picture of a funny.

penguin or something. This is more like. every piece of content generated online. can be its own coin and have its own. market cap and people trading it. Um, and it's just a way for creators to get. paid more directly by their audience and. their fans. So. >> So is this happening right now? >> It is. Yeah. I mean, we just released. this app called Bass with just like last. week, and it's still in beta, but people. can get invites for it and stuff. And. it's kind of like it's like a new social. media app where every post that you make. is a coin. And um you know, if I hope we.

get you on there at some point or. whatever, but if you you could put out. your podcast episode and people could. own it and it would just monetize. directly without having to have. advertising be the primary business. model of the internet. >> Wow. >> Yeah, >> that's awesome. Yeah, >> that's through base. >> Yeah. So, that's where that's where this. is going. Um, the other cool thing about. Bass is it's a self-custodial wallet, so. you you can just hold your own crypto. You own all your own content. Um, that. way like you don't have to trust any. third party, even Coinbase. You don't.

have to trust us. And, you know, we. talked about this at breakfast a little. bit, but for the main Coinbase app where. we're storing people's money, we that's. that's a regulated financial service. business, right? So, you have to get a. license every country you want to. operate in. And so we've had to go one. country at a time, set up a local team, get the local license, you know, so. we're in like dozens of countries now, but it's takes it's really slow and. expensive. With a self-custodial wallet, you're not a financial service business. cuz you're never taking possession of. customer funds. It's it's really just. like a software product just like a web.

browser or um a messaging app or. something. So you can we can launch that. to 190 countries from day one. And. people in all these countries that. really need access to better financial. services like Venezuela and Turkey and. Nigeria, places where there's high. inflation, they don't have good options, they can now use a self-custodial. wallet, anybody with a smartphone. Um so. that's a really cool way for us to just. get this technology to, you know, the. other 150 countries of the world that. are a little harder for us to operate in. as a regulated financial service. business. What I mean, how many.

countries how many countries out there. are fighting crypto? Don't want it to. >> Yeah. So, I mean, it's the the biggest one is. probably China actually. Um, it's. actually it's not technically illegal. for Chinese people to own crypto. And. and by the way, the people in China love. crypto. They all want to own it. Like. they're because, you know, a lot of the. rich people there are trying to get. their money out of China. Um, but the. government doesn't like it. It's kind of. like what what the China did with the.

internet if you're familiar with that. like the great firewall of China where a. lot of applications including Coinbase. but also you know Facebook and in all. these things are blocked in China like. Google. So they've China passed this law. where they said um banks in China cannot. work with crypto companies. So they kind. of like debanked them kind of like what. Elizabeth Warren tried to do in the. United States. Um and so they made it. very difficult for bit crypto companies. to operate there. But they the Chinese. government issued their own digital. currency for the for the the Chinese.

yuan. Uh so they made it what's called a. central bank digital currency uh digital. yuan. But of course it's controlled by. the government and if you if you get on. the wrong side of the government they. can just take all your money and shut. down your account. So it's a tool. They're using it as a tool for control. because they wanted to run their own. blockchain controlled by the government. Uh they're very anti like these. decentralized blockchains like Bitcoin. that are pro- freedom for individuals. So yeah, so China China's is trying to. crack down on it. Um there's a couple.

other countries that. I'd say the the common like in India for. instance, the Reserve Bank of India has. some concerns about crypto because. they're worried about um again capital. controls like a lot of the wealthy. people they they want to plug into the. the broader economy. They want to like. get their money out of the country to go. do things in the world. So some. countries are trying to clamp down on. that which takes people's freedom away. So they they tend to be a little. skeptical of crypto, but the people in. those countries desperately want crypto. So we're often like we're often in this.

kind of interesting situation where we. go in there, we want to work with the. government in those countries to do. things by the books, but the. government's interest sometimes diverges. from the people's interest in that. country. And so we want to provide the. tools to the people for freedom. and not get on the wrong side of the. government. So it's like we're trying to. oftentimes play a delicate game there. >> Yeah. I'll bet. I'll bet. I mean, when we're talking about people.

exchanging you basically using crypto as. a is as is a currency, >> how do they I mean, the big thing for me. is the volatility and and all of it. You. see these massive up and down swings. I. mean, when do you think this will kind. of or will it do you think it will level. off? >> Yeah. Yeah. So, Bitcoin has gotten less. volatile over the last 10 years because. there's just more and more people who. own it now. And I think as you get like. bigger pools of capital in the world, like big institutions and rich people.

all over the world and just everybody. really like as as we get to having there. maybe 500 million people who use crypto. today. I think as we get to like 5. billion or even a couple billion, it'll. get less volatile, but it'll still be. going up over time because more and more. people will be coming in. But you won't. see like these 100% wild swings up and. down. But you know th this is why a lot. of people are using Bitcoin more like a. store of value and then the the as a. currency like a medium of exchange. they're using things like USDcoin. um or things which are less volatile. So.

again it's like crypto kind of has if. you're going to update the entire. financial system you kind of need to. reinvent everything. You need like a. digital gold, you need a digital dollar, you know, you need digital stocks, you. need digital every. So it's crypto is. kind of reinventing all these pieces of. the financial system and making them. more fast, cheap, global, efficient, >> what do you think it will go to? like the long-term implications of it or. yeah I mean well from a market cap point. of view I think it'll it's got like a.

long way to go 10 or 100x but I think. the ultimate outcome of this is that. governments stop controlling um currency. really like we you know we exist in this. world today where there's like 190. countries or so um some of them are. pegged to the dollar but there's maybe. like 150 or so currencies and each. currency each country has its own. currency. That might sound like an. obvious thing, but like imagine if every.

country had its own internet. Like that. would be a terrible situation, right? Like imag somebody in Germany wants to. listen to your podcast and like they. have to pay an exchange fee because they. they're using different internets or. something like that. Like that would be. super inefficient, right? We should all. be running on the same internet. globally. Well, we should all be running. on the same monetary system globally, but do it in a way that takes the power. out of the hands of like a small group. of bureaucrats that can manipulate the. currency or whatever. It should be like. a fair system that no one country or.

company controls. So, I think that's. kind of what we're seeing is um the. power to issue currency is being. unbundled from the state and it's. returning that power into the hands of. individuals and people who they can. choose what they want to use. they don't. have to use it just cuz they live in. that country. Um, and that's going to be. a more fair and free society. It's it's. going to be money that can't be inflated. away. Um, it's going to be every. transaction you can do instantly, you.

know, for a tiny amount instead of like. 2 to 3% every time you swipe your credit. card. Um, and it's going to work cross. border. Like there's tons of people who. are trying to send money to their family. in another country or they're trying to. order goods goods from another country. Like the current financial system is. this incredibly unfair tax on every. transaction in the economy and it kind. of just slows down all progress. >> Um I'll give you an example would be. like you remember text messaging used to. be like 30 cents. >> Yeah. >> Yeah. And you know I think that at that.

time there was maybe like a billion. messages a day sent by text message or. something. But these applications like. WhatsApp came out and Signal and um you. know text messaging got cheaper and now. it's bas like with WhatsApp or Signal. it's it's free to send a message. anywhere in the world right instantly. >> Mhm. >> There's now like I think it's a couple. hundred billion messages sent per day, right? It's no longer one billion. messages a day. It's like 200 billion. messages sent per day because it's free. and it's instant and it's global. And.

that's kind of what's going to start to. happen with the economy and with with. money. There's so much friction today to. move money that if we can bring the cost. down um like under a cent one cent under. one second anywhere in the world you're. just going to see like transactions in. the economy will just flourish and. you'll see a lot more of them happening. Um so that's kind of what we're trying. to do is update the financial system. with crypto, make it more efficient, more global, more fair, more free. >> Who who couple of questions just off.

what you were riveting on there. you. know who who set up the USD stable coin. >> So, and originally there was a company. called Circle in partnership with. Coinbase and we co-created it and um now. they're the issuer of it and we're a. distributor of it but there's a bunch of. legal details behind it but yeah. basically Circle is the issuer of USDC. >> Okay. And then, you know, when we're. talking about moving to a digital. currency globally and and having a. global currency,

>> you know, how how do you think that. would affect the US? I mean, Elon Musk. talks about this how the US has. weaponized the US dollar, which, you. know, is a bad thing, but. >> I mean, slippery slope there, right? I. mean, you get the reputation of that, then people are going to want to move. We I mean, I've brought this up on. several shows. We see bricks. If you're. familiar with Bricks, you know, >> uh what Brazil, Russia, India, >> China, >> China, South Africa, several other. countries have joined, you know, because.

the US has weaponized the dollar. I. mean, so if we move to a global. currency, how does that affect the US. from being able to to have a certain. amount of control around the globe. through through. >> Yeah. So, this is a great question. because I think it's it's a mixed bag. Um it's not it's complicated, right? So I think if you if you think about. like a digital dollar, I'll start with. that. Like USDC to me that's. unequivocally just good for the the. dollar in the United States. It helps. make sure the dollar is the reserve. currency in all these countries around. the world. Creates enormous demand for.

US treasuries. There's a bunch of bunch. of reasons why it's good. If you if. you're talking about Bitcoin, I think. it's it's it's a it's more complicated. because if the dollar maintains. discipline, then it'll continue to be the reserve. currency. If the dollar loses. discipline, like we talked about. earlier, people start printing a ton of. it like the Federal Reserve or there's. these huge budget deficits we keep. running at the federal level that. require us to print more money just to. pay pay things back and they sort of. devalue the dollar, people will flee the.

dollar and they'll go to Bitcoin. In. that case, the United States could lose. the reserve currency status. Now, I' if. if they are if the US is going to lose. the reserve currency status, I'd rather. people went to Bitcoin than to the. Chinese yuan. >> Mhm. Right. So that's why I say I think. Bitcoin is kind of like a check and. balance on the dollar and deficit. spending. Like I I hope that the US. finds a way to maintain that discipline. and the US remains strong. And in that. case, crypto will just be on a like a. very good thing. But if we're going to.

lose it, I'd rather we have Bitcoin than. then we have to all live under a Chinese. system. >> And then you know we're talking about. you're fighting congressmen, you're. fighting senators, governments. What. about banks? What about banks like. Chase, Bank of America, Regions? I mean, are they I would imagine they do not. want this to happen. Yeah. I mean, these are big. organizations and it's funny sometimes.

like depending who you talk to in the. bank, it's either very positive or very. negative. In general, we've had good. relationships with the banks. you know, we actually need to work with them. because we we've basically built a. bridge from the the the bank system into. this crypto system, right? So, we when. people come to Coinbase, they usually. connect their bank and move a bunch of. money into Coinbase. So, we actually. need to work with a lot of them and we. work with most of the big ones, but. there certainly are um elements of those. banks that are skeptical about crypto. and I think they're afraid of being.

disrupted by it. >> It could it could eliminate them, correct? >> Yeah. I mean, if I I don't know. If I'm. sitting here in 10 or 20 years, I'd be. hard. I I still think there'll be like. dollars and there'll be banks, but. you're right. Like, a whole generation. of young people are growing up kind of. thinking like, why would I need some. checkbook and a bank branch on the. corner like I've got my phone, my my. obviously my phone is my wallet. And. they're really using Coinbase like a. bank replacement, like a neo bank some. sometimes people call it. Um, you know, in particular, there's actually like.

this um this community bank lobby. I. I'll just tell you kind of one anecdote. about this. So, when we were trying to. get this legislation passed in um in. Congress for stable coins, the community. bank lobby, which um they have. representatives in all all 50 states, you know, so they're very powerful. politically because there's there's. members of Congress in all the districts. around the US and they each have these. community banks. So, they came in and they lobbied hard. against the stable coin bill. And that. in particular what they what they were. most concerned about is they said well.

these stable coins are paying people. interest like like four and a half. percent on their money. Um and they. don't want that to happen because they. pay their customers you know like 0% or. 0.14% like kind of in their check in. their savings account. and their their. argument to the members of Congress was. well if you allow these stable coins to. come in and start paying people four and. a half% on their money um all the all. the loans will dry up in these. communities like in these small. community banks. Now there's not really. any evidence that that'll happen. I.

think what's more likely is they were. just trying to protect their profit. margins. They're like well we you know. we don't want to have to pay our. customers like a fair a fair rate to. compete in the market. Um, and so they. actually managed to get this line in. their in the bill that was like. prohibits uh stablecoin issuers from. paying interest on their to their. customers, which is like the kind of. unimaginable to me how they managed to. convince members of Congress with a. straight face that like, hey, we want we. want a law to block our competition from. giving more money to their customers. It's like kind of ridiculous. Now, >> that passed.

>> that passed. So, and we now there's a. good good news here, which is that um. we're not a stable coinoint issuer, so. we actually are allowed to continue to. do it. Uh we also pay rewards to our. customers, which are different than. interest. There's a whole bunch of legal. definitions around this, but we found a. way to continue to do it. So, we're. going to continue to pay 4 and a half%. to our customers holding. >> nice USDcoin because we want to just. that's what we want to do is update the. financial system. And if people don't. like the rates in these community banks,

they they should have to compete on a. level playing field with everybody else. Like that's what the free market is. there to do. It it creates better. products at lower prices for customers. So yeah, but that's the kind of stuff we. have to deal with in DC is like these. lobbying groups coming in with special. interests and um it's part of the reason. I'm in favor of small government is like. there's just less to be captured, you. know? Yeah. Um, if you have a big. government, everybody's trying to. influence it and try to get their. special favors and it just it gets like. it gets you these sub-optimal outcomes. How long do you think it'll be before we.

start seeing. maybe we already are, but. when will we start seeing people use. crypto as currency at at at Walmart, at. the gas station, at the grocery store, at, you know, everywhere? >> Yeah. Well, I think the earliest. adopters of it are going to be online. like e-commerce. Um, we just because. they're more digital native, right? Like. we actually just announced this. partnership with Shopify. They have like. they have millions of merchants. Even if. people almost everybody's actually.

bought something from a Shopify store, they just sometimes they don't know. they're doing it cuz it's each one's. like a boutique shop, right? If you go. and buy like beef jerky or like apparel. or whatever. Um, so we just announced a. partnership with them where they're. going to accept uh USDcoin and actually. give 1% cash back to the customer. because the the merchants are now saving. the two to three% on credit cards. So, we're doing things like that. >> Oh, that's slick. >> Incentivize them. >> Yeah. Incentivize people to pay with. USDC and get Yeah. get some cash back. Um, or like that Bitcoin credit card.

that I gave you at the beginning is. allowing people anywhere Visa's accepted. or um Ammex in that case. We also have a. Visa debit card. they can start to go. spend their crypto. Um, now the. merchant's still paying 2 to 3% on that, but I'm hoping, you know, we can go to. the merchant eventually and say, "Hey, you know, a lot of people are paying. with crypto. You might not even know it. Why don't you do a direct integration? You can kind of save those fees." So, there's areas like that where we're. starting to chip away at it. Um but you. know the credit card companies are a big. um oligopoly where it's.

a reason they're able to charge those. high fees cuz like they built such a. strong network um effect that it's hard. for new entrance to come in. So we had. to come you know a decentralized. protocol like crypto is maybe the only. way you could go compete with them. It. wouldn't be you wouldn't be able to do. it as like you know if it was Coinbase. versus one of those things we'd probably. lose. But if it's a totally open. protocol like the internet versus them. maybe there's a chance to break in. Mhm. Do you transact in crypto? >> Yeah, I mean I use my Coinbase card um. for most purchases and then I use it.

online too just to like just to buy. crypto shop increasing like these things. at Shopify and stuff like that. But you. know I'm kind of really trying to live. on the frontier. >> A lot of people they just a lot of our. customers they just hold Bitcoin, Ethereum and they start off with like. really an investment use case and then. they slowly add on these other things. like they all right well okay I have a. bunch of Bitcoin. Can I get a loan on. that? Or. >> can you? >> Yeah, like you can actually get loans on. there's a lot of people who they bought. early Bitcoin. They've got like tons of.

money and they just they can go get a. loan on our website now. So, we're. starting payments, lending, um earning. yield. Like it's starting to become like. a bank replacement. >> Is that through base or through. Coinbase? >> Uh that's through Coinbase. >> Okay. >> Yeah. >> So, I can go on Coinbase and apply for a. loan. >> Yeah. >> [ __ ] I didn't even know that. >> Yeah. And we're that's what we. ultimately want to do is you know it's. it's kind of difficult for a lot of. people to get a loan and it's a lot of. paperwork and um that's what we're. trying to do is update the financial. system like all parts of it including. including borrowing lending.

>> What are you checking when somebody. borrows? Are you checking credit or is. it just what's in their Coinbase wallet? >> Yeah. So in that case it's just the. collateral with the Bitcoin in their. wallet. um uh so we don't need to run a. credit check or anything, but I think. we'd like to find a way to do um what. they'd call like non-colateralized. lending too, which would be just based. on credit. And I think one thing we're. trying to invent is like a decentralized. credit score based on um on the. blockchain, too. So,

>> we could see a a record of like let's. say that um you know you've been. receiving a bunch of money from I don't. know your pod different companies you're. involved in this podcast or whatever and. you know you could actually build a. reputation score like a FICO score kind. of equivalent on chain of all the. transactions that person has done and. then probably lend to them based on. that. Um so we're trying to think about. how to create things like that too. >> Wow. Wow. So a whole new whole new. credit score system. >> Yeah. Yeah. And by the way, I mean, like. in the US, people some, it's difficult.

to get a loan sometimes, other times you. can. In a lot of emerging markets, there's like there's no credit system. You nobody like when I was living in. Argentina, um, you know, nobody can get. a mortgage to buy a house or get a loan. to buy a car. So, the only people who. can own real estate are rich people who. can basically pay the whole amount in. cash cuz there's no there's no mortgage. industry. >> Yeah. Um, so this is an example where. like we sort of take these things for. granted in the United States sometimes. like you can get a mortgage to get a. house and that's how people build wealth.

and all this kind of stuff. I think that. we have a chance again with the. smartphone and this new set of financial. services powered by crypto. We can. actually provide like a lending market. to people all over the world. Like if. you if you live you're some 20-year-old. like living in India and you have you. want to start a little business or like. I don't know whatever it is you should. be able to get a loan to do it. That's a. lending is a key way that you grow. You. have economic growth and most people in. the world do not have access to any uh. credit market. It's kind of crazy.

>> Interesting. Interesting. >> Let's take a quick break. Yeah. >> And when we come back, I want to talk. about the journey to starting Coinbase. >> Great. >> Perfect. >> You know what? Everybody dreads the. inbox. I've gone through thousands and. thousands of emails and I hear you loud. and clear. So, we're making it official. The Vigilance Elite store is fully. stocked. We're dropping new gear more. often. Some limited edition, some.

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the the journey to innovating Coinbase, but just a couple of questions that came. to mind on the break. So, we talked. about 21 million bitcoins will only 21. million bitcoins will ever exist. What. what do you think will happen when. we hit 21 million? >> Mhm. >> Well, yeah. So, right now there's a. smaller and smaller number of Bitcoin. being produced over time and it kind of. it hits like a a maximum number. It.

actually takes like a hundred years, right? But it we're most of the way. through that. I think there's probably. already 20 million or so already out. there. So, there's only maybe a million. left that'll only that'll ever be. created. So right now the bit new bitcoin are. created when people the miners the. bitcoin miners um verify uh a new block. and so that's how new bitcoin are kind. of issued to them as like a reward for. doing all that computational work. running running the network uh once that.

runs out uh they're going to have to be. compensated by the the small transaction. fees that happen on Bitcoin. Um and so. the you know this may be more detailed. than you wanted but. >> you can take it anywhere you want to go. but basically miners get miners are the. people that run the Bitcoin network. Um. they run these data centers all around. the world. >> and today you know majority of their. revenue is coming from new Bitcoin being. issued and a smaller percentage is the.

Bitcoin transaction fees. as fewer and. fewer Bitcoin are produced and the. network grows, it'll shift to being more. about transaction fees than new Bitcoin. um being being mined. And eventually. it'll be zero new Bitcoin being mined u. but they'll still make money from. transaction fees. So I think what that. what hap what that basically means is. that you know the supply of Bitcoin is. not going to keep growing. So if you. want Bitcoin, you're going to have to. buy it from someone willing to sell it. Uh you which is how most people do it. today already, but some people mine them. to get brand new Bitcoin. Um, so anyway,

I that's that's like a simple way to. think about it is once the supply. there's no more ever created, you have. to just buy one that already exists from. someone else. And so that is the price. of Bitcoin is who's willing to sell one. >> So is that is that. how do I say this? Is that like already. set up to where when when we hit 21. million then the then the the miners. will be incentivized with with with. transaction fees? Yeah, I I'd say that's. already happening today. Um, it's just.

it'll it'll gradually shift more and. more to the transaction fees over time. >> And then I mean, does the system ever. need to be updated? Like for example, Bitcoin? Nobody knows who it is. >> And so, will it need to be updated? And. if it does, who does that? >> Yeah, I do think Bitcoin will need to be. updated for u to become quantum. resistant, right? Uh so quantum. computers create this risk that we. talked about. Uh and so you know Bitcoin. has a mechanism for it to be upgraded.

and the way that it works since there's. no central authority that controls. Bitcoin right so anybody can propose an. upgrade to Bitcoin there's what are so. what are called the core developers some. of the people that work on it like the. open source project kind of volunteering. or they're getting paid by donors. there's also the miners the people. running the network there's there's. exchanges like Coinbase that play a role. so there's this whole community of. different participants in the Bitcoin. ecosystem And for an upgrade to happen. like to make it quantum resistant,

there will be various people who discuss. proposals about how to do that. Um, you. know, Coinbase might help with that or. the core developers have proposals. And. essentially for Bitcoin to be upgraded, everyone has to to agree. I mean, not. everyone. You actually just need more. than 50%. So let's say that 51% of the. all the people running you know the. exchanges the h the miners the core. developers um you know they all sort of. decide okay this new proposal is the one. we're going to adopt and that like at.

least 50% or more move to that new. proposal that is Bitcoin that is that is. the chain that has the most people on it. using the most computational power so. it's a it's truly a consensus mechanism. all these people have to come into. agreement Now, there's pros and cons of. that. The downside of it is it's harder. to get that many people to agree on. something, so it can go a little slower. But the upside is that uh you're never. going to get some small group of people. who can take it over and unilaterally do. something to harm Bitcoin.

>> Okay, that that was actually another. question of mine. I mean, Michael Sailor, >> yeah, >> you know, I mean, he is just buying. like [ __ ] tons of Bitcoin. And so, is. that is it good for the for the Bitcoin. market for somebody to to have that big. of a stake in it? >> I think it's good. I mean, he's. obviously a a bull on Bitcoin, but I I. don't it's not like he can own like 50%.

of all Bitcoin or something like that. It's too big right now. Um like in the. many trillions, right? >> Okay. >> So, you know, there's going to be. various groups that come in and try to. acquire Bitcoin positions. Um but that's. good. I think it's just it's just. driving up the demand. >> Okay. Okay. And then just another. question I had was, you know, will we. ever see anything like. investing for your kids like IRA, Roth. IAS,

uh 529 college tuition thing? Like is. there anything like that that's going to. come in the future where you can you can. you can set aside money for your kids or. your grandkids or whoever you want and. without opening up all these different. wallets. >> Mhm. Yeah. Well, so in some ways this is. already happening today. In fact, um. like there's some members of my family, you know, when they were uh when they. were born, I gave them like a bitcoin, right? in that their their parents kind.

of put in a wallet just to hold on for. future. And they were kind of laughing. at me too cuz when I did it it was like. $200 and you know I was like hey maybe. someday this will pay for their college. tuition or whatever and they they kind. of laughed at me. Uh but they haven't. they haven't sold it yet so that's good. Um, so in some ways it's already. happening, but I think you know these. IAS and like these different types of. tax advantageous accounts, I I'd. actually I'd have to go look at the. specific details on each of them, but. there's certain that have permissible. types of investments in there that are.

allowed or not allowed. We're constantly. trying to chip away at these rules to. make it easier where I mean people. should absolutely be able to hold crypto. in there just like any other asset. class. Um, and actually we need to make. it easier for people to do that on. Coinbase. Uh that's something we're. still working on is to open up these. kind of retirement accounts and tax. advantageous accounts. Um we have some. some customers are asking for it now. Uh. so we'll probably have to do it soon. >> Okay. Okay. And then I I kind of touched. on this earlier, you know,

Bitcoin. I mean, there's there's a. handful of them that seem to be. the main stays that are going to be. around for a long time, but then we see. all these, for lack of a better term, trash coins coming out. And there's. been, you know, there's been some scams. in the industry. FTX, Sam Bankman, Freed, I mean, had all these big-time. celebrities vouching for it. Turned out. to be a complete scam. I mean, yeah. >> How do people navigate that that are new.

in the industry? Yeah. So there's no there's no doubt. I. mean crypto has attracted its fair share. of scammers, right? Um. >> just like anything else, you know. >> Yeah. I mean like the internet, you. know, the early internet and even to. still to this day, right? Is like these. emails from Nigerian princes and all. kinds of scams on the internet. You. know, technology is a double-edged. sword, right? Like anytime you make a. technology uh like a shovel, you know, you can use it to build something or hit. someone over the head with it or. whatever, right? and financial services.

um technology I think does attract some. of the wrong actors but it also attracts. like the right people who can build. things and my mental model of the world. I always try to remember is like I think. you know like roughly speaking 99% of. people are good 1% are bad so there's. always going to be bad people who try to. do these things and some of them can. attract a lot of headlines and get. really big in the public psyche but you. have to remember like there's 99 people. behind every one bad one that's trying. to do the right thing and build good. things in the world so We have to be. careful not to like just say the.

technology is bad because one% of people. bad people try to abuse it. But I think. for the average person coming into the. industry, I mean, look, I it's a lot of. basic stuff, right? It's like if. someone's offering you some crazy yields. that sound too good to be true, like it. probably is. Um, if you're just learning. about something for the first time, you. know, don't put all your money into it. Like I would I would say that's true of. crypto, but it's true of anything in. life, right? A lot of people who are. getting into crypto for the first time, you know, I tell them, all right, put.

like 1% of your net worth into Bitcoin. or something and just see how it goes. for a couple years. And, you know, if. you like it and you want to start trying. to trading other ones, you're learning. about it. Okay, put in 2%, 5%, whatever. There there's people who have like 50%. or more of their portfolio in crypto, too, but they're they have different. levels of risk and comfort with that. And then, of course, you got to figure out, you know, what. company to trust, right? Like sometimes. this this you know sometimes there's. companies overseas that are offering. certain products and services that um.

are not allowed here in the US and you. know that can be interesting because it. allows you to live on the frontier but. if you're going to live on the frontier. you know what you you might take some. arrows too and so you've got to sort of. have more personal responsibility like. the government's not going to protect. you in that situation. You you you need. to know what you're doing to really look. out for yourself. So, um I'd say like in. investing there's no there's no return. without risk. Uh if anybody thinks it's. like a this is a risk-free return or. whatever, you know, that's doesn't. really exist. Um so, you know, you got.

to use good judgment, sweet smarts. >> Mhm. And then just another question, you. know, we we were talking a little bit. about prepping at breakfast and. >> Yeah. And um. the big argument with crypto and which. is a little ridiculous to me because is. basically what happens if the grid goes. down? You have no access to your. Bitcoin. Well, you probably don't have. access to your money too because the. financial institutions won't have any.

power either. >> Yeah. >> And so, but I just want to know what. your thoughts are on that. >> Yeah. Well, if the if the electrical. grid or the the whole internet went. down, I mean, yeah. So, societyy's going. to be very disrupted at that point. Um, your Bitcoin won't be going anywhere. It's not like you're going to lose it. If like, let's say that there's a outage. for a month or a year or like, you know, 5 years at least, you know, your your. crypto is still safe. It's not going to. go anywhere. There is a hypothetical way. actually that people could continue to.

do transactions without any internet. where it's actually using your phone um. Bluetooth uh to talk to each other and. you could actually have more of a a mesh. network they would call it. Um, so that. is possible in that kind of a situation, but you know, I think it would certainly. be disruptive and challenging. That's in. that type of situation where you're. talking about that level of societal. collapse probably things like ammunition. and um gold and start those start to be. a little bit more like your fallback. So.

I think people should also own gold, right? I don't think it it's not like. exclusively one or the other, but um in. a world where civilization more or less. continues to exist with electricity and. things like that, I think, you know, Bitcoin is probably a superior version. to gold. So, >> thank you. Thank you. All right, let's. talk about the road to Coinbase. >> Yeah. >> So, I know you got inspired by the white. papers. >> Yeah. Yeah. It was I think it was December of. 2010. I first read that Bitcoin white.

paper. Uh at that time I was working as. an early employee at Airbnb uh as a. software engineer trying to help them. move money to different countries around. the world and reading that white paper. really captivated my attention. I was. like wow this is fascinating and I kept. I re reread it a few times went to some. of those Bitcoin meetups I mentioned. >> How did you come across it? Well, yeah. I was I was just cruising. There's this. website called Hacker News, which a lot. sometimes like people in Silicon Valley. read that's like um has just like. technology encoder type updates. And. yeah, it got posted on there in December.

2010, I think, is where I first saw it. And you know, I went and talked to some. of my friends about it who I was working. with at that time. I was like, "This. this paper is really cool. Like, have. you seen it? What do you think?" And a. lot of my smart friends, they they were. like, "I don't get it. This doesn't make. any sense. Like, this sounds like a scam. or something." And so I kind of had a. lot of self-doubt about it. I was like, I don't know. I think this is kind of a. cool idea. But a lot of people I talked. to didn't seem to think that. So for. about 6 months, I was just thinking. about it, reading stuff, going meeting.

people at these meetups. And sometimes. when I can't get an idea out of my head. and I I keep thinking about it and going. down this rabbit hole, I'm like, "Okay, I got to build something. I got to I got. to try doing something." um because I. don't know what's going to happen but if. if I take some action in this direction. like it might produce more information. and later this kind of created a good. thing I like to say to people which is. like action produces information you. know if you're ever unsure just like do. anything cuz like if you do even if you. do the wrong thing it'll help you figure. out the right thing to do so I started.

working on a prototype on nights and. weekends uh while I was you know I was. at my job at Airbnb nights and weekends. I'd come home and work like 7:00 p.m. to. midnight on this prototype. which was a simple Bitcoin wallet. And. um I I wasn't really thinking of it. exactly like a company. I was just. trying to like learn about Bitcoin and. figure out if I could make a simpler way. for people to use it. Um the analogy I. kind of roughly had in my head was, you. know, email is another decentralized.

protocol. A lot of a lot of people don't. know this, but underneath when you're. sending emails, it's using a protocol. called SMTP. um which would be sort of. like Bitcoin in this example. And you. could in theory run your own email. server. Um but most people don't do. that. They use like Gmail or Outlook or. something. And that's kind of like a. hosted server in the cloud. They sort of. deal with all the security updates and. how these email servers talk to each. other. And so I was thinking there's. there's probably going to be a company. kind of like that for Bitcoin that's.

like G that's like Gmail, right? Like. I'll run the servers for you. W worry. about the security and the backups. And. the average person is going to benefit. from this um but they don't need to have. to understand exactly how Bitcoin works. and all the complexity behind it. So I. started building this as a prototype and. I applied to this startup incubator. called Y Combinator. Uh some people. might have heard of it but it's it's. kind of famous in Silicon Valley because. they'll give you like a like 150k as a. check if you have a really early stage.

idea for a company. and I applied to. this um this Y cominator program and I I. got invited to interview. I I was trying. to find a co-founder. I couldn't find. the right co-founder. Long long story. short, I got accepted into this program. or offered to join it. And they're like, "Well, you have to quit your job. We'll. give you 150k and you come work on this. thing full-time if you want to really. really do it.". >> And so, I had kind of a tough decision. to make because I Airbnb I knew was. going to be a big company and I was an.

early employee there. So, I had stock. options, you know, that would have been. like the comfortable path, right? I. think if I had just stayed at Airbnb and. and just let my options vest, I I. probably would have been worth like tens. of millions of dollars, right? Um, and I. I I had like maybe 20 grand in my bank. account that time as just being a. software engineer in Silicon Valley, traveling a little bit. You know, I'd. made a little bit of money and saved it. But I could tell I was on a rocket ship. and this was going to be a good company, but I was like, I really wanted to try.

to go build something new in the world. And I was willing to take that risk cuz. I was I think I was 30 years old, um, unmarried, I didn't have kids, and I I. had this really deep desire as well. I. was like, I want to try to do something. important with my life, you know? Um, I. don't know if it was like an insecurity. that came from like just people not. recognizing me or, you know, I wanted. girls to like me or like what whatever. it was, I was like, I want to go do. something important like something crazy. and something hardcore, you know, that.

really has an impact. And it, you know, for whatever reason, I was like, I have. to do this and really give it a shot. And if it fails, like I'll be okay with. that. But if I never tried it, I would. probably regret it, >> right? >> So, I don't I don't know. it might feel. similar to like why were you called to. like be in the military or whatever. I I. never felt like I had taken a risk and. really done something that would have. greater like significance. So I decided. to quit quit my job. Um I called my. parents told them that my mom was like. oh my gosh like are you going to have.

health insurance or like what did you. know she my parents always worry about. these you know the practical things and. I was like I don't know I'll probably. get health insurance it's fine mom. So, so this guy gave me 150k. I'm good, right? Um, and so I I quit my job to go. work on this thing full-time. And I. joined Y Comer has this three-month. program where you go there and you. basically with a bunch of other founders. and hackers and you just grind like 12. 14 hour days and you try to create a. prototype and at the end of the three. months they put you in in a room full of.

like couple hundred investors like. Silicon Valley venture capitalists and. you give your like five minute pitch. along with like a hundred other. companies and then you see who wants to. invest and um you know at that time I. was really just solo by myself and I. didn't really get that much attention. from investors. Like I was out I was. trying to I think they'd given me the. 150k check. I was trying to raise a. million dollars as my at the end of the. three months from investors and I think. I got like three or 400k like I got a.

little bit of money there but there. wasn't enough interest to get like a. million dollar investment at the end of. this. And I talked to a bunch of these. venture capitalist guys and a lot of. them were like this you're going to make. like a new kind of money to like compete. with the dollar like what this doesn't. you know why would anybody trust you? this doesn't make any sense, right? And. I was like, "No, no, it's not me. creating it. It's a it's a decentralized. protocol. It's Bitcoin, right?" And they. they some people were just like, "Get. out of my office." You know, they didn't. understand what I was doing. But there. were a couple people like that had.

already read about Bitcoin and they were. pretty excited about it. They were just. looking for the right company to back. And I did get some good seed like seed. investments and things like that. And. that's when I I raised that initial seed. round. And then I was lucky enough to. meet my co-founder Fred Ersome. I can I. can keep going, but some of the pieces. started to come together in the early. stages of like finding the right. investors, finding the right early. people to work with, finding a. co-founder. And um we also made a big. decision at that time to actually go and.

try to get licenses to operate in the. United States and be like a trusted. legal business cuz a lot of a lot of the. crypto people I met at that time, they. were kind of trying to fly under the. radar. or they were trying to build. these offshore entities cuz they hated. the US government. Um, and I was like, you know what, the the company that wins. in this space, you can't just be like. underground flying under the radar. Like, you know, if you eventually it. gets big enough, like the government's. going to come talk to you and ask you. why you're doing this without a license. or whatever. So, we went and got um.

money transmitter licenses they're. called in the US. This is the same thing. that like PayPal has and these different. companies. So we decided to build it in. the US, take a trusted and compliant. approach. and uh you know that was the early days. like I can tell you there's there's lots. of good stories about like finding. product market fit. How did you know. because a lot of times you're building. these prototypes and nobody cares. >> You put it out there in the world and. like people come and look at it and. nobody gives a [ __ ] right? >> And um yeah, I mean I don't know. You. want to hear that story? I can tell you. a little bit. >> Yeah. Yeah, I want to hear it.

>> Yeah. I mean so this is the hard thing. about starting a company, right? is like. you you try to this could be with it. could be anything like a podcast, a. coffee shop, but certainly true in tech. startups too. You know, you you make. your your version one and you put it out. there in the world and usually like no. one cares, right? That's that's the. default. There's so much noise of things. that people are going on. This is. trending and this is what you know and. so how do you how do you break through. the noise? And so I had put out this. prototype um of a simple Bitcoin hosted.

Bitcoin wallet along with my co-founder. Fred Ersome and we posted it just on on. the internet like on Reddit and some of. these forums and like a hundred people. would come sign up and then no one would. no one would stick around and use the. product. And so they teach you this. thing in Y accommodator which is like. how to find product market fit. Like how. do you get your initial users to want to. actually come back and use the product. on a recurring basis. And what you. basically do is you just like go and. talk to them and get their ideas and. feedback and then you go try to improve. your product and then you go talk to.

them again and you improve it again and. you talk to your customers again and you. improve the product. It sounds simple. but like a lot of people don't do that. They're when they're trying to start a. company, especially tech entrepreneurs. in Silicon Valley, they get caught up in. all this other [ __ ] They're like. going to fancy conferences and like. trying to write really amazing blog. posts and try to sound smart and you. know um just they overoptimize on. talking to every venture capitalist. It's like no, you got to just like talk. to your customers and improve the. product. Talk to customers and that's.

how you get a product to actually find. product market fit. So, long story. short, so I. >> How would you How would you talk to How. many customers were there at the. beginning? >> Yeah. So, when we put out the first. version, it's like maybe a couple. hundred people came and signed up and. then they but they didn't stick around. They didn't they didn't keep using the. product. And so, I remember I was just. emailing random people who had signed up. and I'm like, "Hey, I I built this app. I'd love to get on the phone and talk to. you about it." So, I would just call. these people out of the blue and and um. I remember this one guy I was talking to. on the I was like, "Hey, I noticed you. signed up for the app and you didn't.

come back. Like any feedback?" And he's. like, "Well, yeah. I mean, I it was. pretty cool. Like, I would use the app, but I don't really have any Bitcoin.". And I was like, "Oh, that's interesting. Well, when you signed up, if there had. been like a buy button right in the app, would you have used that?" And he's. like, "I don't know. Probably." Um, and. it sounds so obvious, but at the time, you you couldn't actually buy Bitcoin on. Coinbase. You had to if you already had. Bitcoin, you could put it in there and. use it. Uh, but I don't know why I. didn't think about this beforehand. Some. of these talking to customers, sometimes.

you have these like obvious moments come. back to you, but so I was like, "Okay, well, let's try to just put like a buy. Bitcoin button in the app." And to make. that work, I had to go get a bunch of. stuff done. We had to hook up like a. payment method. We had to get a bunch of. legal things figured out. We had to hook. up to a um one of the early Bitcoin. exchanges to source the Bitcoin. Anyway, long story short, we got that launched. and like people started using it, right? Like and it was like every day pe more. people would use it than the prior day.

because it became the simplest way to. buy Bitcoin and people started to spread. the word about it. Like back in that. time to buy Bitcoin you had to go to. like one of these overseas exchanges. like Mount Gaus in Japan. You had to. like wire money. Um and it was. inconvenient. And so just through that. process of like talk and that by the way. that was not like the first thing we. tried. There was like probably a dozen. other things we talked to customers. about, tried to improve the product that. didn't work. And eventually we hit on we. hit on one of them and the product. became good enough that there was more.

people coming back every week trying to. use the product than had the prior week. Not because we were manually talking to. them. They were just word of mouth. They. were starting to tell other people. And. that was the minute we were like, "Oh, the metrics started to go up." And the. biggest problem became not trying to. find product market fit. it became how. do you keep up with demand and how do we. scale this company? How do we start to. hire more people because we were getting. a bunch of customer support tickets. How. do we go raise more money? Because we. were using all of our working capital to. try to source the Bitcoin on these.

exchanges and moving tons of money. around the world. So that was the moment. we were like, "Okay, we're ready to go. raise the next round of financing." And. we felt like we had the kernel of. something that was now starting to grow. People actually cared about it. Um and. that and it came with it like solved one. problem and then it brought along a. whole another set of problems to go deal. with. >> Wow. Wow. How f how fast did you see it. grow? >> You know that's when when product market. fit especially with tech companies. starts to work. It's it's shocking how.

fast it can grow because it's not like. like a local business, you know, a. sandwich shop or something, only a. certain number of people drive by it. every day or whatever, but it went from. like a hundred people using it every day. to. uh or it was maybe easier to talk about. in terms of people signing up every day. It was like instead of like a 100 people. signing up today, it was it would be. like a thousand and then it was like. 10,000. And then I remember one day it. was like 25,000 people signed up in one.

day. And I went to you know if you look. at these different st sports stadiums. and I was googling sports like that. stadium holds 50,000 people. I was like. looks like a ton of crazy number of. people. like, "Holy [ __ ] all 50,000. people signed up in one day," you know, and then to give you a sense of the kind. of problems we started to encounter at. that point was like, you know, you can imagine if you have. 50,000 a day people signing up, you're. getting a lot of customer support. tickets. We had no customer support. team. So, between like 900 p.m. and.

midnight, my co-founder and I and our. first employee, we would answer all. these customer support tickets. >> Holy [ __ ]. >> Yeah. So we were and we had we we were. developing a backlog of like 10,000. 20,000 customer support tickets where. like nobody was hearing from us and this. was a big problem and then you know we. had a bunch of hackers come in and try. to start to hack into our into the app. because they realized oh more people are. storing money here and we had to create. a whole that cold storage system I told. you about earlier where we started to. store all the funds offline. We had to.

build that rapidly because you know if. we had gotten hacked at that point like. we would have been insolvent, out of. business and um I'll tell you like a. little story actually from that day cuz. you know you can imagine we're we're. kind of sleep deprived. We were like. working 14-hour days, 7 days a week. trying to keep up with all this. And um. I remember we were in the office one day. and eating lunch and there was just like. maybe three or four of us around the. table and somebody was looking at their. computer and they're like, "Hey, there's.

a lot of like refunds going out to. customers. That's weird." Like we all. looked around and no, none of us are. doing it. Who's sending all these. refunds? We realized one this hacker had. broken into um one of our systems that. like an admin interface on the back end. that allows you to issue refunds to. customers and he was just sending. refunds to himself as fast as he could, right? And we were like, "Oh shit." So. we go in there, we we shut down um the. site temporarily. Customers can't access.

it either. And we're like, "How did he. get in here?" We start trying to debug. it. we find the way that he accessed. this particular system and we patch it. and we come back online. And in the time. that he was able to send out all these. refunds as fast as he could, you know, I. think we had lost maybe um. $50,000 or something like that. Um now. at that time we had only raised I think. the three or 400,000 that I mentioned.

And so 50,000 out of 300 three or. 400,000 we were still alive, you know, but if he had started doing that at at. midnight while we were all asleep, we. would have been out of business by. morning. >> Wow. >> You know, because we caught it within. like 10 minutes. >> Yeah. >> Um and it's just pure it's pure luck. that like Coinbase would not exist. today. That was that was like a coin. flip that if if that hacker had waited. till midnight to start doing it and we. hadn't noticed, we would have been. insolvent by morning. >> Wow. >> Yeah. Wow.

Damn. I mean, what was the. what was the moment that really got you. when you were like, "Holy [ __ ] this is. going to work.". >> Well, there was a lot of moments along. the way where I I knew that we had a. chance to to really make this big, but. it was not guaranteed. Like, there was a. lot of ways we could [ __ ] it up along. the way. I mean, that that's an example. where we were seeing a lot of demand. we. were starting to generate revenue but. like were our systems hardened enough.

where these attackers couldn't get get. in obviously not there was some gaps. right at that time so that was a risk. like the cyber security risk was very. real that was how a lot of crypto. companies died right um and then the. other big one was compliance and and. like government we thought the. government might just come by and shut. it down the whole thing so those were. probably two of the biggest risks and. then there were also competitors, right? Um,

so we, you know, we were off to the. races, but then we started to see really. solid companies pop up overseas and in. the US, you know, I yeah, I mean, there was. definitely. we also thought that by the way, there. could have been like a flaw found in the. Bitcoin algorithm or something like that. that would have just blown up the whole. thing. Um, you know, we had looked at. it, we couldn't find any flaw in the. algorithm. We thought, okay, this will. this will work. it'll stand the test of. time, but who knows? Like maybe some. smart mathematician came up with. something we didn't think of right now.

So anyway, all those risks we were able. to mitigate over time. And uh the I think it I think it got big. enough where enough Americans started to. use it that the government now can't. shut it down. You know, it's just it'd. be political suicide to try to shut it. down. Like people want freedom in the. United States. They want the ability to. own gold, guns, they want Bitcoin, like. all these things. Yeah. So, but in the. early days when it was small, somebody. somebody in the government if they had. had their act together could have tried. to kill the whole thing. I mean,

Elizabeth Warren and Gary Gendler tried. to, right? Yeah. >> But it was too late. So, >> those were the risks along the way where. we didn't know if it was going to work. >> I mean, we we talked a lot about. economic freedom here and there uh on. the first segment here. So, I I just. want to ask you, you know, what is what. does economic freedom mean to you? Yeah, I think economic freedom to me is. it's your money, right? You should be. able to do whatever you want with it. Um, there's a lot of middlemen in. society that are blocking payments,

taking fees, slowing things down. Economists would call it this idea of. property rights, which is basically. can you actually own stuff or can it be. taken away from you without your. permission, right? And in many countries. of the world actually like the money in. your bank account can just be yanked out. by the government. Um there in Cyprus uh. in the 2010s there was an incident like. this where the government passed some. resol they were like the government was. having deficits and they had some law.

they passed where they just took like. 50% of the money out of everyone's bank. account. So obviously you don't actually. own it, right? Um. >> when was that? >> I think it was in the 2010s. Yeah. Or um. maybe the 2000s. Yeah. So there's and. there's examples like that in history. Same thing in Argentina by the way. You. there's times where you know the. government has just printed so much. currency that it devalued. That's. another form of theft basically. It's. high inflation. Um where they devalue. everyone's assets to just give the.

government more money. Right? So. property rights is this kind of like. it's a foundation that's required for. all progress in civilization. Like if. you if you can't actually keep what. belongs to you or like you know if there. could be some. gang that wrote runs through the. neighborhood and just like kicks you out. of your house and takes all your stuff. Um you know it's hard to like make a. real plan for the future and try to. build a company or like do anything good. for society if your [ __ ] can just be.

taken from you at any given time, right? And it's the same thing with what we. what we'd call like sound money, right? Can the value of your money or your. wealth just be eroded or seized from. you? So, property rights, sound money, these are foundational to all progress. in society. Um, and most people in the. world actually don't have very high. economic freedom. Uh, we sort of take it. for granted in the US. Even in the US, I'd say it's a little under threat. Like. we talked about the inflation of the. dollar. Um, you know, there's there's.

incidents where like people have felt. like their property rights are under. threat here. you know, eminent domain or. like whatever you want to talk about. But in general, like the US is pretty. good. We have pretty good rule of law. Um, most countries in the world that's. not the case. And so that's what. economic freedom means. I think crypto. is like a it's the key piece of. technology that can give economic. freedom to anybody in the world. As long. as they have a smartphone, they can sort. of opt out of that local system that. they're in if it's corrupt or not. meeting their needs.

Why do you think crypto or excuse me, why do you think Coinbase is the most. trusted exchange out there? >> Yeah. >> What have you done that's different than. the other ones? >> Yeah, it's a great point. When we do. surveys um by third parties or just. blind surveys, we do come back as the. most trusted brand of crypto. I think. it's a few things. One is that companies. are a reflection of their founders, right? And I think the fact that I was. willing to put my name behind it. I'm. based in the United States. You know,

I'm American. I'm an American citizen. I think just my demeanor, like I'm I try. to just be like do the right thing, kind. of tell the truth. Um, you know, people. may or may not like me. I don't know. But they at least they're like, "This. guy I don't think he's like full of [ __ ]. or a scammer, right?" Um, and I think. we've also tried to follow like a. compliant and and regulated approach. You know, I like in in general, I'm like. probably more for like deregulation and. like free markets, but we f we've like. followed the law. we've gone and got. every license that we needed to do in.

the US um in other countries where we. operate. So. I think those things um we also we've. reached a certain size and scale now. where um we have a track record of doing. this successfully, right? Like you know. we're we're storing crypto for like 140. different government institutions now. If you look at federal, state, and local. um you know we work with like the US. Marshall Service for instance at the. federal level. There's other federal. agencies we work with but we that we. can't talk about. Um but you know we.

work with some of the largest. institutions in the world too like like. Black Rockck and these these folks. We're a public company so our financial. statements have been audited by the big. you know the big four accounting firms. They can come in there and validate that. we're actually saying what we're saying. is true. Uh the money is really there. you know these kind of things. Um, so I. think all those things have contributed. to our brand having a lot of trust and. like you have to earn it every day. I. mean, there's there's times where, you. know, we got backed up on customer.

support tickets and we and we like. didn't invest enough in customer support. or um there's times where we've had. hackers try to break into our systems. and we've had to make customers whole, right? Or they'll call customers and try. to impersonate Coinbase support and. trick them into moving their their. crypto somewhere, right? And in general, uh, we try to like stand stand behind. our customers and, you know, reimburse. them when things happen that are our. fault. Um, and we try to go push back on. the government when it does something. unethical and tries to take our.

customers rights away. So people, I. think they really appreciate that as. well. So those are probably all factors. that contribute to trust. >> How do you I mean, how do you lead your. company? >> Well, it's a broad question. I mean. there's kind of the tactical which is um. about once a week I I get together uh. usually on Mondays we get together as an. executive team and we just do a deep. dive on anything that needs to get. worked out and decided. Um I try to push. decision-m down into the organization so.

that I'm not a bottleneck to things. getting done. Like oftentimes we're. about 5,000 people now and in in these. organizations as they grow oftentimes. like people get frustrated with I don't. know there's like seven people who have. input on this thing. No one's in charge. Like if if everything has to go up to. Brian as the CEO like you're just not. going to be able to execute quickly. So. I try to name who's the decider and push. it down in the organization so stuff can. just keep moving. Try to have a really. high bar for talent, you know, like be. very selective on the way in.

Performance manage people out. Make it. merit-based. Um, and then you know we have a healthy. balance I think of we're investing in. our core business today but we're always. trying to like build the next thing on. the frontier and we try a lot of small. bets and some of them don't work and. that's okay like in a lot of big a lot. of bigger companies you can actually. they get riskaverse right. >> like if somebody tries some new project. and it doesn't work it's like a black. mark against them and it's [ __ ] up. their career Coinbase that's not the.

case we want people who are willing to. try innovative creatative ideas on the. frontier with small teams like you know. two to five people. It's almost like a. startup within the company and if they. try it and doesn't work try another one. you know and eventually these things. break through and you can have. innovation happen and big companies that. create lots of products that people want. to use. So it's not just like we found. one thing that works and that's all. we're going to do forever. Summer's here and if you're anything. like me, you didn't spend the winter. just sitting around. You stayed sharp.

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you know, we we co-created that um with. digital dollar. Another one is base, which is um like a very fast, cheap uh. blockchain that allows all these. payments to happen instantly all over. the world. And we just released a new. app that lets these content creators get. paid directly. Um. you know another one is that we are. creating um a platform where anybody can. create integrate crypto into their. company. So um you might be familiar. with like you know Amazon web services. right like Amazon's the retail shop but.

they also said hey all this computing. and data centers maybe if other. companies want to use it they can they. can plug into it. We we've similarly. created something called Coinbase. developer platform CDP and for people. who want to integrate crypto custody, payments, trading, etc. They can just. use the services that we've built and. plug crypto into any company they want. Um, so there's various products like. that that we've built over time which. are, I think, hopefully continuing to. push on the frontier. >> You know, another thing that uh that I.

like about you is you don't you don't. bend to the the culture wars. >> Yeah. Yeah. Let's talk about that. Let's talk about it. >> Yeah. Well, okay. I think what you're. referring to is um I put out a blog post. a while back called mission first, which. was said we're going to be apolitical. here at Coinbase. We're just going to. focus on the mission of the company and. not uh any of the other activist kind of. social justice warrior policies that. were running rampant at that time. And. it had a big impact not on Coinbase but.

also I think a lot of the tech industry. I'll give you kind of the backstory on. that. So, Yeah, it was um around 20. 2020 I believe. Um you know we I as CEO. you always host host these open open mic. sessions and town halls at the company. and normally people would be asking. questions about our products and. competitors and regulators and like how. are we going to win? And around that. time I noticed we started to get more. questions from the employees at these. town halls about issues in society that.

were totally unrelated to our business. you know, they were asking about like. police brutality or um guns or Middle. East stuff or, you know, social issues, right? I remember thinking this was kind. of strange at the time because I was. like, you know, that's not why we're. here. Like I I'm just like anybody else. I'm trying to understand these issues. I. read about it sometime, but um why are. they asking me what I think about police. brutality or something like that? That's. not what our company's focused on. And.

it got to kind of like a fever pitch at. a certain point where it almost was like. they were trying to put see who could. make the executives on stage like squirm. the most with like the most. uncomfortable, you know, difficult. question. And um this culminated with at. one point an employee stood up and they. and they said, "I want to know if this. company is going to support Black Lives. Matter.". And I and I kind of I was I didn't. really know much about Black Lives. Matter at that time and what that. organization stood for. And I I declined. to answer. I was like, "I don't know. Well, I'm happy to look into that, but.

I'm not going to commit at this moment. And they they did like a little bit of. grandstanding and they kind of held the. mic and they said, "That's not good. enough. I need to know like are you as a. CEO going to support Black Lives. Matter?" This was kind of in the fever. pitch of George Floyd and all this kind. of stuff. And I declined to answer. And. so after the town hall, um 300 employees. did a walk out, uh where they basically. like refused to work and they kind of. went on protest and left. >> Are you serious? >> Yeah. This was I didn't realize the extent to.

which this had happened, but like a. bunch of kind of this activism mindset. had infiltrated the company. And a lot. of this originated I later I later. learned a lot of this originated in the. universities. They were kind of teaching. about like Marxism and how to speak. truth to power and like be an activist. inside these organizations. So. culturally this was like reaching a. fever pitch. And. >> how many how many employees did you have. at the time when 300 walked out? >> Probably one to 2,000 or something. So. So, a good chunk did a walk out and.

actually it's funny. I remember there. was one guy on our team um John who he's. he's actually a veteran and all these. guys were like posting in Slack about. I'm I'm I'm walking out and I'm holding. the counter and he he just he was one of. the only people who posted. He's like. you guys can leave if you want. I'm. staying here to support our customers. I. was like so he had he had the balls to. like stand up to this in the moment. which was hilarious. But um I always. appreciated him for that. So anyway, all. these people walked out and so I pulled. the executive team together and I had. never I had I had never experienced.

something like this as CEO. I was like, what is going on? Like what the hell is. Black Lives Matter? Like, you know, and. somebody on my team came in and they. were like, I think it's just like it's. just asking for like equality amongst. all people. And I was like, okay. Later, of course, I found out they wanted to. like defund the police and they had all. this kind of like crazy misallocation of. funds. There was all kinds of issues. with BLM. You might remember at that time like. every company in America it felt like. was putting out these flags and it was. >> Oh, I remember. >> Yeah. >> So.

I was I initially I was like okay well. if it's just about equality or something. like put out some statement and let's. get people back to work and people came. back to work. But I I felt like. something was very wrong here. I was. like we have a fundamental. misunderstanding about what we're doing. here. I thought we were here to kind of. build create more economic freedom with. crypto and these people think that this. company should become an activist. company for social justice and BLM like. we are not on the same page and what I.

realized is I I had failed as a leader. like this it was one of those kind of. moments where the frog was slowly. getting boiled like people were. sometimes ask me these things in the. company and I was kind of walking on. eggshells around it because I was like I. didn't really know how to deal with it. I was like, "Oh, yeah, yeah, yeah.". Like, "We're we're we're just kind of. trying to be good for everyone." I I. made a lot of very vague statements. And it culminated in this walk out. And. the more I started to think about it, I. was like, "Okay, either I need to go as. CEO because this is how companies are.

run now, like where you have to answer. all these social justice things, or or. they need to go because I don't want to. work in a company like this where we're. just jumping to whatever the current. issue is. um trying to virtue signal and. touch on some giant, you know, whether. it's whatever Hamas or whatever it is. that day, you know, and like we we we. should be focused on one thing. It's. hard enough to change one thing in the. world. We can't be like jumping around. to some new issue every every month. And. I don't like this this environment where. like the comp the employees feel like.

they can come in and hold the company. hostage to whatever their current thing. is. So I drafted this post which. basically said, "Hey, guess what? At. Coinbase, we're going to focus on the. mission, increasing economic freedom. It's okay. You can have whatever. political beliefs or anything you want. outside of that, but like keep it. outside of work, right? We're here to. focus on work at work, which sounds like. kind of an obvious statement. But at. that time, this was. uh highly contrarian. Let's just put it. that way. Um, and I knew that this was.

going to be controversial if I put it. out. In fact, there were people inside. the company who begged me not to post. this. They they said, "This will destroy. the company.". uh like you know an underrepresented. person will never work at this company. again. Um and I was and I was like as as. as a young CEO I was kind of like is. that true? That doesn't sound right. So. I went and talked to like groups of. employees like including our black. employees and other groups and I kind of. asked them and I was like. do you care if we're like a social.

justice company? and they were like, "No, no, we just want to like come in. here, do good work, like learn things, you know, have an impact, like make more. money." Like that's it's the kind of. stuff everybody wants. And so my. instinct was telling me the level of. fear is like totally out of proportion. to reality. And some people told me, if. you post this, like 50 or 60% of all. employees are going to quit or they're. going to walk out again in protest. It's. going to be an even bigger protest. And. it was like this kind of like moment. where I was like, have I lost control of.

the company or am I willing to stand up. to this nonsense? >> And so I decided to post it and I I. posted it and I announced it to the. company. I was scared shitless to be. honest with you. Um, normally when I'm. up there talking in front of the. company, I can like I feel fine. Like my. leg was like shaking. My voice cracked. like I was a teenager. Like I was I felt. I was like you ever I don't know if you. ever have that moment where you're like. trying to give a talk to somebody and. then there's like a voice in your head. kind of evaluating how you're doing at.

the same time you're like oh I'm [ __ ]. it up you know. Um so it was like the. most awkward presentation I've ever. given to the company. I almost like was. like wanted to cry. I was like this is. going to this I knew it was going to. like piss off a ton of people. And um. and afterwards I said anybody who's not. on board with this we'll give you like a. 3-month severance and like you know help. you find your next job like totally you. know it's on it's my fault like I didn't. make this clear up front but this is the. kind of company we're going to be going. forward so we got to all be on the same. page and 5% of the company quit. They.

took the exit package. Um and 95% of the. company was aligned. We were all. >> nice. >> ready to get [ __ ] done. Go in the same. direction. Best thing we ever did for. the company. And suddenly like a few. things happened after that. Like one um. New York Times and a bunch of mainstream. journalists started writing hit pieces. on the company about how we were racist. and all this nonsense. >> Oh, go figure. >> Yeah. Um by the way, a year later, it. didn't change the demographics of the. country. Uh the company at all. Uh we.

had some it was either the same or. better metrics across all the things you. look at. By the way, we just we just try. to go on merit now that who cares like. what your sexual orientation is or. whatever. I don't I don't care. like we. just try to hire people based on merit. But all of their accusations about. racism and stuff, it's it's like it was. completely false. And then um yeah, and. then all these like other CEOs of other. companies started calling me and being. like, holy [ __ ] how did you do that? Like I want to do that.

>> and and I and I was like, well, you can. just do it. And like they'll but you. know, people were kind of scared to do. it. Some of them did do it. And I think. a lot of companies move moved in that. direction. So, you know, we took some. arrows for it to be kind of early on. this, but I think it was great and it I. loved it. Like, um, it made us such a. stronger company. And I've now we've. actually been able to hire a lot of the. best people who've come in and they're. like, I joined Coinbase because of that. blog post. Like, I want. >> That's awesome. >> Yeah. I mean, where did where do these. people go? I mean, you did it, Elon did.

it with X, and now we're starting to see. it at Google, Facebook, lots of tech companies like followed. suit on that. Where where do these. people go? And that's a black mark. I. mean, for anybody I mean, I'm the the. the Silicon Valley tech network seems to. be pretty tight. You guys all seem to. know each other and so and everybody. knows what's going on and that hit the. New York Times and everything. So, I. mean, if you see somebody that left.

Coinbase at that time era or. left Twitter during that time, I mean, it's it's like a black mark. It's like, oh, you weren't Oh, until that date. Okay. So, you're one of those. >> Where do they go? >> Yeah. You know, I I haven't really like. spent a lot of time tracking that, but. um but you're right. I mean, we do look. at that of when people worked at. different companies and you can kind of. draw a story and you can go talk to them. as an individual and get more nuance, but. I mean, look, there were some companies.

that just leaned even harder into it and. they're like, "Hey, we I know we make. suitcases or like CRM software or. whatever, but we're actually about some. bigger thing in the world." And if. people wanted to work at these social. justice companies, they're welcome to go. do that. Um, >> not to mention, I mean, talking about. social justice and what you're trying to. do is economic freedom, >> like, okay, like, >> yeah, >> the [ __ ] are you complaining about? >> Exactly. Like, if somebody's really into. like Marxism and socialism, it's like.

not a good fit. You know, you should not. work at Coinbase. Um, so there was I. think we've been much more clear with. people now when they join the company. And so that's what I had failed to do. was just create clarity because I was. afraid of upsetting people. And it that. was a good moment for me as a leader to. be like, okay, your job is not to be. liked. It's to be clear about what we're. doing here. And then people can opt in. or not. That's fine. Let's talk about.

there was one other thing took on the SF. SEC. We talked about that. And then uh. extortion by hackers. What was that all. about? >> Yeah. Well, this was been a more recent. one where. um so we've always had hackers trying to. break into our systems and we spent a. lot of time building secure storage and. I mentioned earlier kind of like how we. divide up keys and they're never never. touched the internet and they're like. distributed all over the world in these. like super secure locations and we. pentested and everything but there are.

hackers who tried to do something a. little different uh recently which was. they actually started contacting our. customer support agents. and trying to bribe them to turn over. customer information. Now, our customer. support agents don't have access. They. can't like move your money, right? But. they can turn over things like, you. know, people's personal information like. their name, address, um maybe their. balance or something like that because. they're looking at that to try to help. customers with their problem. And, you.

know, we started getting customer. support agents get offered like 250. grand bribes for some of these things, which which is crazy, right? And unfortunately. um especially in some of our uh. facilities we operate overseas on this. If you ask a thousand people, you offer. 1,000 people 250k to turn over some. information like that, uh they're going. to find one or two bad apples. And so. that's what started happening. Um some. of these agents were actually, you know, cuz they're not allowed to use their own.

computer. They're not they're not. allowed, it's a locked down system. Um. they're not even allowed to bring in. their own phone. They have to use like a. work phone. But what some of these folks. started doing was smuggling in a. personal phone and taking photos of the. screen with some of the customer. information and giving it to these. attackers. And then the attackers would. call up our customers and say, "Hey, this is Coinbase support like are you. blah blah blah who lives at this. address?" And it would create. credibility and they would try to tell. them, "Hey, like your your account has. been compromised. Like you need to move. your funds immediately and like can you.

send it to this address and sort of. trick people into sending their funds to. the attacker.". So um we noticed that this was happening. and um we start we by the way we we. refunded the customers who were affected. by this. So none of them had any loss. Um so the attacker who had gotten this. this information they were the the. information they had gotten was starting. to get less and less useful cuz we were. cracking down on it and hardening our. systems. There's a whole bunch of ways. we can do that by the way. Um,

but what happened is they basically once. the information started to be less. useful, they sent us a ransom demand and. they said, "Hey, we're going to leak all. this customer information. Um, send it. to journalists and if you don't pay us. $20 million.". So, we we kind of got together as a as a. team, our our chief security officer, and these guys are great, been working. on this stuff for a long time. and and they kind of said, "Look, we. shouldn't pay the ransom because uh. yeah, maybe they'll they'll hold off.

releasing the information for a few. months, but guess what always happens?". They come back and demand more like 3. months later, 6 months later, and how. good are we going to feel if we give $20. million to these criminals, and it just. funds their next attack. And like, you. know, just emboldens them, right? And. so, we came up with this idea in the. room, why don't we flip the ransom on. them? will put out a $20 million bounty. for any information leading to their. arrest and conviction. And this was kind. of a controversial idea in the nice.

>> Yeah. in the security community. A lot. of people later told me like, "Ah, we'd. always wanted to do that, but we were. kind of afraid to do it." And um and. this was a great moment where I was. like, "Let's turn the tables on them and. try to catch these these bastards, right?" So that's exactly what we did. We put out this 2020 $20 million bounty. By the way, when Osama bin Laden um you. know took down the trade the powers, I. think the US government put out a $25. million bounty for information on him. So this was like a pretty substantial. bounty, right? And it's one of the you. know, you know, you heard that.

expression like there's no honor amongst. thieves. So all these hackers started. sending in uh tips. A lot of them were, some of them were regular people, but. others were actually other threat. actors. Um and they're like, "Guess. what? I know the guy who did that. attack." like, you know, cuz they have. some beef with this guy or whatever. We. got like 5,000 tips that came into this. tip line cuz people wanted $20 million, right? And, you know, maybe like a. couple hundred of those were like really. solid leads. We had a team start to work. down the list. Um, uh, we don't have.

anything like to announce today on it, but I think I think like we're making. really good progress towards a couple. arrests here. And it long story short is. it's not just like one person involved. Like there's it's as with everything, it's more complicated, but. um we've gotten to build some really. good relationships with law enforcement. and uh it's going to feel really good to. catch some bad guys. >> That's awesome, man. I can't wait till. you get them. >> Yeah, >> that's good thinking. Great thinking. Let's talk about the I mean, I know you.

were instrumental in the Genius Act, correct? >> Yeah. >> What is that? >> The Genius Act is a piece of legislation. that helps stable coins be allowed to be. used in the United States. Stable coins. are these digital dollars. It allows. payments to happen quickly and cheaply. anywhere in the world with the US. dollar. You know, I mentioned some of. these other payment methods, right? Like. credit cards, 2 to 3% fee every time the. merchant um swipes your card. Like wire. transfers, they work internationally, but they cost like $50. They're kind of.

slow. You know, there's lots of. different payment methods, but they none. of them are like fast, cheap, and. global, right? And so stable coins are. the only ones that check that box. They. can send them anywhere in the world for. under one cent in in 1 second or less. >> Wow. >> So, uh, USDC is, uh, you know, I think the. biggest legitimate one that's out there. and all the all the dollar stable coins. are backed by US treasuries, which means. that we can actually pay like four and a.

half% to people holding these things. Um, which I mentioned earlier, you can't. really get on your checking account or. savings account. So anyway, the Genius. Act, it took a lot of work by members of. Congress and Senate, bunch of companies. including us have been kind of. advocating for this legislation and it. just creates like clear rules around how. these things can be issued um and used. And now that there's clear legislation. that just got passed last Friday. I was. at the White House for the signing. ceremony with President Trump. Um I. think you're going to see more and more. businesses start to accept stable coins.

It just saves them money. Like if you're. I don't know as an average consumer you. might think ah two two to 3% fee that's. not that much I don't pay it the. merchant pays it but if you're like a. grocery store or something your margin. might be like only 5% right so if you. have to pay 2 to 3% to the credit card. companies and your margins five that's. like a huge chunk of your of your profit. margin right your your um your margin so. anyway I think it's just another way. that crypto is updating the financial. system and the stablecoin act is a huge. first step this genius act The other big.

piece of legislation we need to get done. is called the Clarity Act, which is. about the other kinds of crypto assets. that are not stable coins like Bitcoin, Ethereum, and it's kind of helping. determine which of these are commodities. or securities. It's there's this is the. lack of clarity that got weaponized by. Gary Gendler and Elizabeth Warren in the. prior administration. If we have laws. passed that make it clear how these. things are regulated, they can't come. attack it and try to kill it again in. the future. Makes sense. Makes sense. I mean, what I.

think I read that uh the Federal Reserve. put Bitcoin, Cardano, Ethereum, XRP. The Federal Reserve is going to hold. some. What does that I mean, what does. that mean for us? >> Yeah. Well, the President Trump passed. this executive order creating a. strategic Bitcoin reserve and then a. crypto asset stockpile to hold some of. these other ones as well. A lot of. people don't know, but you know, the US. actually holds strategic reserves of a. number of different assets. So gold is.

probably the most famous one, but. there's a bunch of other ones that they. hold like you know there's an oil. strategic reserve, there's like. palladium, I think there's a bunch of. like rare minerals and so it's kind of a. historic step where the United States. government is saying actually we think. Bitcoin is another strategic asset which. should be held by the US government. This would have been unthinkable by the. way like five years ago where the. government was so skeptical of it and. now like the United States government is. is holding a a stockpile of these of. these Bitcoin assets. So.

that was a huge moment. Um it kind of I. by the way now that the US is doing this. I think like the rest of the G20. countries and central banks are all. starting to look at this. It just kind. of instantly legitimized it. And you. know, President Trump, to his credit, he's he said he wants to be the first. crypto president in the United States. and certainly in the world. Like he he's. all in on this. He's like, "America has. to lead here. This is a technology to. update the financial system and and. become a financial center of the world, which is important for American power.". So, he's kind of gone all in on it. And.

I think the rest of the G20 are now. looking at this as a model to follow. >> Man, nice work again. >> Yeah. >> Yeah. So, let's move into I want to talk a. little bit more about the about base. So, Jeremy, my producer, who you met at. breakfast says it's it's the Amazon of. crypto. What all is going to be wrapped up in. this? >> Yeah. So, Bass is an app that we just. launched the beta of it last week. Um,

you know, people started off with. cryptocurrency. buying it like like. Bitcoin like a for investment purposes. Then we started to make other types of. financial services like payments and. borrowing and lending with things like. USDC stable coins. Base is kind of the. third act here where we actually want to. make a way for applications on the. internet to use crypto natively and. allow value transfer between users. that's totally permissionless. So, like. if you're a content creator, uh either. you have a podcast or maybe you put out.

like you're a musician, you're putting. out music or you just post on social. media like text content or anything, you. can have a direct relationship with your. audience and actually monetize from them. directly. Um so an example is like if. you make a post on base and you put out. a photo or a text or audio video, anything um people every post is a coin, right? So people can buy that coin um if. they think it's cool, they like it, they. think it's going to go up in value. It's. like literally every every social media.

post on base, the minute you post it, it. has a a coin with a market cap that. people can trade and they can also buy a. coin of you as the the content creator. and they can say, "Okay, I like that. post. I think Sean's going to put out a. lot more banger banger content. Like let. me buy his his token and you have a. market cap." Like your your thing can go. up and down. And so it's allowing. content creators to basically directly. monetize their audience or their. customers. Um it breaks you know there's.

there's traditionally in the internet. there's been kind of like an ad ad. business model for everything. Sponsorship on podcast is one example of. that but even like Google and Facebook. they always have these ads right. >> because payments are so high friction on. the internet most of the big companies. got built on the ad business model. And. that means that they're collecting all. your information trying to sell it to. advertisers. That's sort of how the. internet happened. Now the internet has. a native layer for money and value. transfer can be super seamless like.

microtransactions, giant transactions, whatever. And so we think it's going to. actually put this whole ad business. model like flip it on its head where um. yeah, people can directly have. relationship with their their audience. There's no middlemen and like instead of. 95% of the value going to the platforms, it's going to go to the content. creators. It's going to totally flip. that value equation on its head. >> Wow. What kind of creators are on there. right now? >> So, it's all early stuff. Um, it's some. people that are, you know, they're. they're putting out like video content. kind of like Tik Tok. Some people are.

putting out music. Um, I think that. you're also going to see uh kind of like. communities formed that are due like. around specific interests, right? Um, it. might be people who are like tech. entrepreneurs or really into fitness or. whatever. So, it's early days. It's kind of like. the early days of the internet. A lot of. it's like kind of quirky and weird and. but people are experimenting with it and. coming in at a pretty rapid clip. There's like I think I don't know. I. think there's like 300,000 people on the.

wait list right now. So, we're slowly. giving out invites as it um as it ramps. up. But, uh yeah, it's cool. And by the. way, I should mention Bass is a. self-custodial wallet, too. So, everybody owns their own coins and their. own uh all the content they're posting. and everything. They they fully own it. they can take it with them anywhere. Um, if they if they don't like the base app, there's like it's an it's all based on. open protocol. So, you can basically you. can move to another app that supports. the same thing. There's no lock in to. that one. Um, and you own your own. coins. Like, it's not Coinbase storing.

it for you. It's a self-custodial. wallet, so we can distribute it to 190. countries from day one. It's not it's. not a regulated financial service. business. >> How do I get on the wait list? >> I'll send you an invite. Yeah. I mean, actually, I I mean, you're you got your. your audience would probably uh exceed. our capacity, but um yeah, we I mean, we. can give you an invite code or something. if you want to give it to Patreon. members or something like that. >> Oh, yes, I would love that. >> Okay. Yeah, we could do that. >> Hell yes. Thank you. Yeah. Thank you. >> How many Patreon members do you have? >> We got about 90,000.

>> Okay. Okay. That's even bigger than I. thought. >> We can break it up. Break it up. >> Okay. >> We'll put it at the top tier. >> Okay, >> man. Thank you. >> Yeah, that'd be great. And then, you. know, I know you're So, you're you're. venturing into some stuff that's has. nothing to do with crypto. What is that? >> Yeah. Well, I mean, just zooming out, like my I guess the thing I'm most. interested in the world and I feel like. the best way to help the world is to. accelerate technological progress and. try to build cool things that are useful. to people. Um, and so when Coinbase went.

public, you know, I was I got some. liquidity from that, some money, and I. was trying to think about um, in. addition to going and buying a house and. some things like that, I was like, "All. right, what do I want to try to do in. the world?" Still pretty young. Um, and. so I started to look at some of the what. are the big challenges on the frontier. of science and technology that I could. try to put some money towards, right? Like honestly, I was kind of inspired by. Elon, right? He, you know, he made some. money early from PayPal and he was like, you know, rockets and electric cars and,

you know, it's sometimes it's hard to. raise money from venture capitalists for. like the really crazy ideas because it's. it's higher risk, right? >> And so I feel like in some ways if. you're a software entrepreneur and you. manage to have some success, you almost. kind of owe it to society to like put. some of that capital back into the. frontier like try to do hard things. which are high risk in the world of. atoms, not just bits, right? which would. be like software etc. Um so I remember I. I reached out to a couple smart friends. of mine. We started hosting uh some. dinners and I would kind of go around.

the table and ask people like you know. what are the coolest things on the. frontier of technology right now that. need more investment and smart people. working on it. And you know, of course, like people talked about AI, crypto, brain machine interfaces, um, fusion energy, and one of the topics. that came up was human longevity, right? And we were thinking like, okay, people. have been trying to live longer forever. This is kind of like, you know, most of. it's snake oil. Um, but we're a couple.

like interesting trends are happening. right now where this might start to be. tractable like in the next decade or. two. One of those trends is that like AI is. coming on the scene, right? And we can. actually use AI to test a lot of. hypotheses and help drug discovery be. more efficient. The second big trend is. that there's something called uh single. cell sequencing where you can like take. an individual cell and read out the. state of it. uh like you know what genes. are turned on and off and like what kind. of proteins are going on in there and. you can the cost of sequencing a cell.

like its entire state has been falling. falling like crazy you familiar with. like Moore's law with the in the. computer revolution there was a thing. called Moors law where like the number. of transistors that you could get on a. computer chip it like doubled every 18. months for a certain price point and. that's why computers kept getting more. and more powerful at like an exponential. pace. So there's a there's a phenomenon. kind of like that in biology where to. read out the state of a single cell, human cell, the cost is like falling by.

half every 18 months or something like. that. And so we can now read out the. entire state of a single cell for like 5. US. It used to be like $500 to do it per. cell. Now it's like 5 cents and it's. just going to keep getting cheaper and. cheaper. So these two trends were. happening and. um you know we some of these scientists. and folks that we invited over they they. they told me you know you should go look. at this field called epigenetic. reprogramming where you can essentially. reprogram the state of a cell. Like if.

you had a cell that's an older cell. maybe you could restore function that it. had when it was younger. Or if you had a. cell like a skin cell you could turn it. turn it into like a muscle cell or a. different stem cell or like a neuron. like a different type of cell. And so we. went to go look into this and kind of. like reading that Bitcoin white paper in. 2010 and the more I started to read. about epigenetic reprogramming I was. like there's something interesting here. This is an underfunded kind of novel. area of science that could be really. high potential. Like imagine if uh your.

metabolism or your immune system or some. or your skin cells like we could go in. there and reprogram it to be restore. function it had when it was younger, right? Like who wouldn't want to have. like the metabolism of a 20-year-old or. maybe your muscle recovery from like. injury or the gym or um your immune. system could be like a 20-year-old, right? Like if you get the flu when. you're 85, it could be fatal. But if you. get the flu when you're like 20, it's. fine. You just take a week off, right? So we we we found a couple of the right.

scientists and people to start this. with. I co-founded the company along. with uh Jacob Kimmel uh who is a. brilliant scientist in this area and. Blake Buyers who had worked in biotech. for a decade uh cuz you know it wasn't. my background was not in the science. piece but I had capital and I had um. some experience building companies and. so we decided to kick off this company. just a few years ago and it's had some. really exciting initial progress where. we've been able to demonstrate for the. first time taking uh human cells and. restoring function they had when they.

were younger. >> Wow. Yeah. And um there's some cool. videos I can show you of just like. >> you know like um we we have these like. humanized mice model where we actually. put human cells inside the mouse and. then like if you have an old mouse and a. young mouse and you give them both. certain amount of alcohol like the old. mice take longer to sleep it off, you. know, kind of like like people. Um and. we've been able to like restore the. liver of these older mice and they they. wake up like the young mice with no. hangover kind of thing.

>> Wow. So again, getting this working in. humans is is the is like a big. challenge. It's like definitely this. could take another decade to like start. to see drugs and therapies that humans. could take. But it's early stage. It's. um it's an exciting company. It's like. 35 people in South San Francisco. Um you. know, I put like 100 million of my money. into it, committed to it, and uh you. know, we've raised some money from some. really amazing people, too. So anyway, that's an example of the kind of thing. I've been working on. I mean what what. kind of what kind of what kind of things.

is that going to be able to to solve? >> Well, yeah. So, imagine, you know, we. all kind of lose function in our bodies. as we get older, right? Like the big. things that if you look at the big the. biggest killers, it's like heart. disease, cancer, diabetes. So, a lot of. a lot of medicine is targeting how do. you treat that disease? But there's. another theory which is like maybe the. the root cause of all those things is. that you know our cells are just losing. function as we get older and so you're.

more susceptible to get these diseases. like let's I'll give you an example. So, if you're if you're like, let's say. you're in your 20s or 30s and um you. know, you have some damage to your. cells, like you you have some you drink. too much or you um you get sick or like. you know, and and there there's just. kind of like this insult or damage to. your cells, your your cells have the. ability to recover from that. Um when. you get older, your cells don't really. have the ability to respond as well to.

these kinds of um threats or like you. know it could be viruses or you know. eating or drinking too much or what not. getting enough sleep or whatever they. start to lose their function. And so. instead of treating like the effects of. these down these diseases, why don't we. just try to restore the function your. cells had when you were younger? Um and. it may actually be like kind of a root. cause of a lot of these diseases that. manifest later in life. Like if you look. at all those diseases I mentioned, they're basically highly correlated with. age. The older the older you are, the. more you're likely you are to get it, right? Like once in a while you'll see a.

kid like a young person who gets cancer. or something, but it's very rare. It's. almost all people later in life. And so. it's kind of like what you might call um. like a root cause or a meta like a. solving a meta problem. Like if you can. solve this problem, it it automatically. like knocks out or minimizes the effect. of a bunch of later diseases that you. get in life. Um like you might be. familiar with um the GLP1s like these. ompic type drugs, >> you know, and that's the first time. we've seen a drug that's like a trillion.

like a trillion dollar drug where people. even healthy people are taking it now. because they just want to have they want. to lose weight. I think that the. exciting thing about these longevity. drugs is that if these start to work, and again, it'll take like another 10. years or more to know for sure. Um, if. these start to work, like everybody over. a certain age is going to take these cuz. like who wouldn't want to feel like you. had the metabolism or immune system or. whatever or the muscle system of like a. younger person, right? That would just. be. >> more years of healthy life, you know, to.

get stuff done. So anyway, I think we're. on the cusp of potentially being able to. make a breakthrough in this area and. it's a it's high risk, but I think this. is exactly what people should be doing. Like if you have some success in. business, like try to push the frontier, right? Do something that's really. challenging. >> So is I mean how is this like how does. it work? Is it like stem cell where they. inject cells into you or. >> it's related to that? So so yeah, the. science behind it um I'll give you the. high level version. Um, so there's a guy. Shiny Yamanaka who won the Nobel Prize,

Japanese guy in around 2006 and he. showed you could take a skin cell and. reprogram it into a stem cell like you. were saying. So um, and he through a. bunch of work he showed that if you. basically put these four proteins in the. cell, it kind of reverts back to a. earlier state where it's it's a stem. cell um, and then it can redifferate. into being a skin cell again but with. younger properties. So this was like a. breakthrough in the field. he got a. Nobel Prize for it. Um, subsequent to. that, people have shown that you could.

turn a skin cell into a different kind. of cell, like a neuron or a muscle cell. What we're trying to do is not change. the type of the cell. We're trying to. just change the the functional age of. the cell. Like, if it starts as a skin. cell, stay as a skin cell, but just be. like a younger version of yourself. And. so, we're searching the vast space of. different sets of proteins. These. they're called transcription factors, which basically turn on and off. different genes in the cell. Um there's. like a massive number of combinations of. these that are potential. We've. developed a high throughput screening.

system that can test like millions of. hypotheses and we're looking for. interesting targets that come out. Like. to be honest, our understanding of the. biology of it is not very good. We. actually don't know why. Like even. though this guy won the Nobel Prize, we. don't even really know how it works like. and why it works, but he he found. something that did work. And so that's. what we've done at this lab in South San. Francisco. We've set up this high. throughput screening system. U that's. testing millions of different. combinations of these looking for novel. sets of proteins you can put in these. cells that that change the state of it.

back to like a younger cell. And we know. that. >> so you're injecting proteins. >> in it would be an injection of proteins. into the body that the cells absorb. >> Yeah. And they're delivered via this. thing called lipid nanoparticles. But. yeah, it's basically a way to deliver. proteins into these cells and it causes. them to turn on and off different genes. >> Wow. >> Yeah. How far out do you think you are? >> Um I mean we're going to start clinical. trials on our first program um probably. in the next year or two in humans. Um.

and that's where you have to go through. FDA or different countries you can do it. in. And then we have two or three other. programs coming along. So I I think. within like 5 to 10 years we'll. hopefully have candidates ready for you. know potentially someone could actually. go get it prescribed by their doctor in. like. hopefully like less than 10 years. But. um you know these are kinds of things. that. sometimes you need to try a lot of shots. on goal to get something that works. right and it can start to get expensive. the later you are down doing these human.

trials like. >> some it costs something like $2 billion. and takes about 10 years to get a drug. to market. Um and that's with a lot of. failures along the way. So you know. we're we're putting a lot of capital to. see if we can come up with a. breakthrough here. So you're getting. ready to be introduced to a whole. another type of bureaucracy. Yeah, the FDA I mean actually inside the. current FDA they are trying to find ways. to optimize this because like by the way. China is making very quick progress on.

how they run clinical trials and there's. a phenomenon happening where sometimes. someone will publish a paper like a. research paper in the US and then apply. for a clinical trial and before their. clinical trial starts there's already. patients in China with that drug in in. their body because they're kind of. seeing all of our papers get published. and then they can run the trial faster. So there's people like in the current. FDA that are trying to think about. um you know I'll give you an example of. how we could make it more efficient. So. right now there's three there's phase. one, two and three trials. The f phase.

one trial is all about safety like is. this thing even safe to put in a human. body and phase two and three are about. what they call efficacy meaning does it. even work? So first you check is it if. it's safe second does it does it work? One thing we could do is like. if you pass phase one trial and you know. it's safe, allow a doctor to prescribe. it to patients while it's going through. phase two and phase three. I mean, if. someone's at the end of their life, like. they literally they're going to die like. in a month. >> Yeah. >> And they have no other option and we. know it's safe, dude, allow them to take.

it, you know, especially if if a doctor. >> we had something like that, right? >> Like a right right to try. >> Yeah. >> Those kind of things. But it's still it. hasn't gone far enough. Um that would be. an example where we could really start. to accelerate it. So, I hope we get some. of those things put through the FDA as. well. Otherwise, like these companies. are going to start running clinical. trials overseas just to get faster data. back. >> Yeah. I mean, I know you're in very. early stages, but I'm just curious. I. mean, how much. maybe you have a target, maybe not. I. don't do Do you have any idea how much.

more life somebody could experience by. taking something like that? >> Yeah. So the initial the initial drugs. that'll come through, you know, um we. hope they could add something like five. to 10 years of life. But the the the. real moonshot goal here is that if we. get this working in one cell type, we. can get it working in another cell type. and another one and and eventually. you'll be able to take a cocktail of. these like of these that kind of help. improve like a dozen cell types, especially your brain. Like that's the.

that's the holy grail kind of. Um, and. if that works, I mean, the goal is to. get to like indefinite, right? Like, you're not going to be immortal because. you could still get hit by a bus or. something or, you know, shot or. something, right? But if you if you. don't have something like a physical. thing that takes you out, you should, in. theory, I I can't see any law of nature. that's getting broken that would not. allow you to become perpetually kind of. renew renew, right? And there's all. kinds of crazy implica imp implications.

of this downstream if this works. I. mean, I'm I'm kind of in purely. hypothetical land here, right? I I don't. want to overstate this, >> but we might start to see these people. that, you know, they they look kind of. young, but they look different. Like, you know, they're it's like the vampire. movies or whatever. Like, they look like. they're in their 30s, but they kind of. look different, like they're like a. thousand years old or something, right? So, you get into all kinds of. interesting sci-fi type analogies, and. people come up with all these. philosophical debates about, you know, should we even want to live longer?

Anyway, I I think that curing disease, giving people the option to live longer. if they want to, these are all. unequivocally good things. And so it's. worth pushing on this frontier, but if. it ultimately works, how it changes. society could be quite profound. >> Yeah. I mean, do you think. >> do you think it would would it make an. would it make an older person look. younger or would it kind of stunt aging? And you like if you if you're 42 years. old, are you going to stay 42 years old.

or are you going to look like you're 32. years old in a year or however long it. takes to work? >> Yeah. The answer is we don't know for. sure. I mean there are now examples of. human cells that we've been able to. restore. It's not just stopped aging. We've been a actually able to restore. function they had when they were. younger. So in some sense you can call. it like reversing the aging, right? But. you know I'll give you an example. So. like your skin when you're when you you. know we all start as like a single cell. like a fertilized egg right and we're.

dividing and our skin and bones and like. brain everything kind of develops like. in our skin we have this thing called. the extracellular matrix which is kind. of like this protein structure. It's not. the It's not the cells themselves, but. it's kind of like, you know, you. probably heard about collagen and these. different. So, it kind of gives your. skin like that flexibility and. springiness and over time that uh the. ECM, the extracellular matrix kind of. can deteriorate, right? So, this is like. a big open question. If we if we restore.

your skin cells to be like they were. when they were 20, are they actually. going to go in there and maintain and. repair the extracellular matrix so your. skin stays like really springy or are. they just going to be like aged uh sorry. are they just going to be young cells. but on an aging extracellular matrix? We. don't really know. We got we got to go. run these experiments. Another example would be like you know. people um who they have like uh scarring. on their liver that's called like. fibrosis right if you damage your liver.

it develops this kind of like scar. tissue and one of the experiments we've. kind of been running recently is like if. you if you reprogram your liver cells to. back when they were younger maybe your. liver cells are young but it's the scar. tissue is still there. This is still too. early to say, but like some of the data. we've been seeing indicates that the. young cells can actually like um repair. or disintegrate the the scar tissue. >> Wow. >> So, we we don't know yet, but like. there's a possibility um that if we. actually are able to successfully. restore these cells back to the younger.

state that they'll just like kind of. maintain and restore. Like I'll give you. one other kind of interesting data point. like um. you know baby there there's there's a. thing called like um I think it's called. like prenatal surgery right like where a. baby in the womb can actually get uh. some kind of surgery to repair something. and when the baby's born they don't have. any scars from the surgery um or even. you see this sometimes with like really. young kids like if they get like a um. part of their finger chopped off or. something like a kind of horrific thing.

but there are accidents like this if it. happens when they're really young like 2. years old, a lot of it will grow back, right? And so our bodies like there is. something in our biology which has the. ability to like regenerate tissue to re. even regrow like a piece of a finger. Um, and if we can unlock that capability. in in adults, like we we know it's. possible because it's it's happening. when we're younger. So why can't we turn. that back on? It might be possible in. adults. We it's not like some completely.

it's impossible thing. There's sort of. an existence proof. It happens at some. point in our life. So why couldn't it. happen later in our life? That's what. we're trying to find out. >> Do you think it could be a cure to. diseases like Alzheimer's, stuff like that? >> It's again, we're in highly speculative. land here. I don't want to like. overpromise, but in theory, yes, it's. possible because we don't know exactly. the cause of Alzheimer's. I mean, people. talk about these amaloid plaques. building up and things, but when you're. younger, why don't they build up? I.

don't know. Maybe you're you're um. there's certain cells in your brain that. are not like the neurons, but they're. basically helper cells trying to clear. out those plaques and things. So, if we. can reprogram them to have the function. they had when you were 20, maybe it does. help with that. We we don't know. One, we haven't started on We want to. actually start a program on Alzheimer's. and brain and like brain cells. We. haven't started it yet because it's one. of the most expensive ones to do in. terms of how you run clinical trials. So, but we'll get to it eventually. I. think that's one of the most exciting. ones to figure out cuz ultimately if our.

if our bodies are still functional but. our brains are going, it's kind of like. what's the point, right? >> Yeah. >> There's no reason to live if you if your. brain's not there. >> Sorry to pepper you with questions. >> Great. >> You know, newborns, I mean stuff like. Down syndrome, things like that. Is that. something that this could prevent? So. that's kind of a different area of. science. But I think um because that's. really more about the DNA like if you. have an extra chromosome that that's.

what causes Down syndrome. But. >> um I do think there's a whole other. field that's emerging around embryo. editing, right? So you know you're. probably familiar with like. >> people using IVF, right? And you can um. have these embryos frozen and then you. can kind of um sequence them and see if. they have diseases or down syndrome or. anything like that. And this is kind of. controversial because people, you know, people have all kinds of beliefs on this. about what should or shouldn't be. allowed. Is the embryo a living thing or. not? There's a lot of fraught territory. here. But I think what's happening is.

that we're get first we're getting to a. world where people can choose um like. sequence these embryos and choose the. one that they feel like has the best. chance. Um then what's going to happen. is people are going to have a lot more. embryos to choose from. There's a. technology called invitrogamogenesis. where you can turn skin cells into. embryos. So you don't have to like. harvest them from the eggs like from a. woman which can be a quite invasive. procedure. So then you'll be able to. have like thousands of embryos to choose. from. Then. um what'll happen after that is people.

will choose the best ones and then they. can start to make a few edits to it like. it to prevent it'll start off initially. to prevent disease. Like there's like. sometimes a single base pair of DNA can. cause you to have like heart disease or. higher risk for Alzheimer's. Like. there's different single base pair. changes and then there'll eventually be. like multiple base pair changes where I. don't know thing anything you know like. depression um uh you know like IQ you. know there's all kinds of things people.

might want to edit in the future. Um, and it's an interesting thing societyy's. going to have to figure out is do we. feel okay with that. Like, you know, we. are we already sort of go out of our way. to try to give as much benefit to our. children as we can. Like what food we. give them, where we send them to school, where we where they live. And so I think. if you have a choice about okay like. this embryo has a 50% chance of um. depression but they might also be like a. great artist you know and this embryo.

they're less likely to have these bad. things um and they spike really high on. these other things I care about people. parents are going to have choices to. make like which which embryo do I want. to implant which one what do I want to. bring to fruition so you know in some. ways that's for a lot of people that's. probably like really scary and playing. God and like all kinds of things. I. think for other people it's it's saying, okay, how are we going to start to um. shape evolution and like take control of. it? Uh because AI is taking off at a. crazy pace. Like how is how is human. intelligence going to keep pace and we.

already kind of we already choose this. but by who we choose to marry and who we. choose to have children with. >> has a huge impact on what our kids are. >> and where you send them to school and. etc etc. Why wouldn't we also kind of. give them the best chance they can. genetically? I think eventually it'll. become like. weird not to do this like in 50 years. Um it'll almost be like risky like. rolling the dice to not um. >> take a look at the data. So that's. another interesting area that'll that. could come to come to fruition. I'm not.

doing anything currently in that area. today, but. >> just kind of intellectually interested. in it. >> Wow. >> Fascinating stuff. Yeah. >> What we're wrapping up the interview, but I just got a couple questions left. What what advice do you have for new. innovators and founders? Well, there's a lot of different areas. like people could get advice on. I think. the biggest the big picture advice I. would give people is it's action. produces information, right? A lot of.

people are sitting there think ah I kind. of want to start a company but I'm not. sure exactly what to do and this area. could be interesting but what if that. happens and what if the government shuts. it down and what if this competitor does. it? I you can kind of have this analysis. paralysis. You just need to get started with. something and just anything you can. think of to do like just just go try and. do it. It'll probably be the wrong. thing, but just the fact that you tried. it, it'll give you an idea about what to. do next. And there was many times in. Coinbase's history where where that was. the case. Like the first version of the. cryp of the Coinbase app that I built, I.

I built it totally wrong, right? And. almost like the the minute that I. released it, I was like, "Oh, now I. realized how I should have done it." But. if I hadn't actually gone and stepped. into the unknown, I never would have. figured out a better way to do it. And. there's an analogy I love to think about. which is kind of like imagine you're. looking at a mountain. You want to try. to summit the mountain and it's shrouded. in fog and clouds and you can't really. see the top of the mountain. In fact, you can only see like six feet in front. of you. The the the fog is so thick, but.

you know there's some mountain up there. You can't just sit down on the ground. and think about how the right path. You. got to take a few steps into the fog, into the unknown. And you might get. stuck on some ledge that's like, "Oh, I. got to backtrack." Like, "That was the. wrong way, right?" And sometimes you'll. be able to see a little farther than. distance. Sometimes you can only see a. few feet ahead. But if you don't take. steps into the unknown, like that. action, you'll never know the better. path to go. And most people, they don't. have, I don't know if it's the risk. tolerance or the fear of looking stupid. or like doing doing the wrong thing or.

whatever it is. I think, you know, they. never take that step into the unknown. And I this sometimes people ask me like. why do a lot of tech founders are have. autism, you know? I think like one of. the reason I I I'm probably somewhere on. that spectrum myself by the way. Um but. I think one of the reasons like people. with on the spectrum or have autism like. are tech founders is that. they don't really have um social anxiety. about people thinking that they're. looking stupid or dumb. Like it's it's.

not that they don't know what's. happening or that they but they just. don't care. It's like and so. >> fear is gone. >> Yeah. Like and it's like a social um. >> they're kind of blind to it socially. which can be funny in certain situations. like you know if they just do something. that they don't everyone else thinks. it's weird but they don't know that it's. even weird. Um but in in an. entrepreneurship that tends to help you. a lot uh because you're willing to just. take steps into the unknown unafraid of. looking stupid to try lots of things and. eventually you find something that. works. So that I don't know that would. be my biggest piece of advice is just. like action produces information. If you.

have any kind of an idea of what to do, just do it. Even if it's the wrong. thing, and it'll produce more. information. >> I love that. I love that. Last question. >> If you had three people you'd like to. see on this show, who would they be? >> Ah, there's so many good ones, I think. And you've you've met with a bunch of. them already. Um, let's see. Have you had Elon on?

>> No. Okay, could be a good one. Um, I. mean, everybody wants to interview him. That's maybe an obvious one. I'm trying. to think about ones that would be less. obvious. Um, who are you excited about? >> Yeah, I think I I am excited about. people building on the frontier of. technology. So, I'll give you a couple. names. I think there's a guy Keller. Renado. He started um a drone delivery. company that's really amazing called. Zipline. Um, he's also working on. another another biotech company. I think. he's he's really impressive.

Um, have you had uh I know you had Palmer. on. Have you had Brian Chimp from Andre? He's the CEO. He's he's he's a rockstar. as well. I mean, they're building like. nuclear submarines, like all kinds of. crazy stuff now. >> Um, let's see. Um, I mean, do you want to talk to like. government people? And you'll talk to. any I know anybody.

>> Government people. >> We talk to a lot of those. Could be anybody. How about the crypto. space? >> Yeah. Um, >> who's doing something new and innovative. in that? Well, I think um Jesse Pollock. on our team who who created the base. protocol and the base app, he's he's. great. >> Um, >> perfect. That's three. >> Yeah, that's a good start. >> All right, Brian, thank you for coming, man. I appreciate the time and I hope to.

see you again. >> Thanks for being interested in what. we're up to. >> Yeah. Cheers. [Music]. No matter where you're watching Shawn. Ryan Show from, if you get anything out. of this, please like, comment, subscribe, and most importantly, share. this everywhere you possibly can. And if. you're feeling extra generous, please.

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