The return of crypto

SPEAKER_1 (0:01)

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Ethan Wu (0:36)

Thank Pushkin, a reading from the Book of Crypto.

Rocket emoji, rocket emoji, moon emoji, moon emoji, money bags emoji, money bags emoji, we are so back, let's effing go. Today on the show, really, is Crypto back? This is Unhedged, the show where we talk about interesting smart things in finance and also cryptocurrency. I'm Ethan Wu, here in the New York studio, joined by Katie Martin from London, who is fresh from a crypto conference. Katie, I can't believe they let you in the door as crypto's most notorious hater.

Katie Martin (1:11)

I'm not crypto's most notorious hater, but I am impressed that you managed to get hold of the holy scrolls of crypto there.

Ethan Wu (1:18)

They were buried in a secret tomb.

Katie Martin (1:21)

So it must be true.

Ethan Wu (1:22)

Somewhere deep in Egypt.

Katie Martin (1:24)

Yes, so the FT hosted a digital assets summit and there was some crypto stuff in there, but here's the thing.

The primary focus for kind of grownups in the crypto space now by which I'm thinking kind of banks, other kinds of financial market intermediaries are how can we use the technology? Not which silly coin can I put my life savings into? So a massive change of tone there. And we also spoke to the new Binance chief executive, Richard Tang, the other one has agreed to step down and pleaded guilty to some stuff that we can get into later on, but...

Ethan Wu (2:00)

Some bad stuff.

Katie Martin (2:01)

Yeah, some not great stuff. But if you're thinking, okay, new Broom, new Binance, then I'm afraid I've got news for you because we were interviewing Richard Tang, the new chief executive, and we asked him a very hard question, Ethan. Are you ready for it?

Ethan Wu (2:13)

I'm ready.

Katie Martin (2:14)

Where are your headquarters?

Ethan Wu (2:16)

I'm shaking in my boots. My PR person didn't prepare me for this.

Katie Martin (2:20)

And he said, why do you feel so entitled to these answers?

So that is it right there. That's the new, transparent Binance for you.

Ethan Wu (2:30)

They're turning a new leaf, clearly.

Katie Martin (2:31)

Absolutely.

Ethan Wu (2:33)

Well, Katie, we too are entitled to answers for what's going on in the crypto space, which recently feels like a lot, right? I mean, Bitcoin the other week crossed 40,000. Now it's at like 45,000, I think. It's gone up double digit percentage points in the last month or two.

You got the Coinbase CEO whose stock has tripled this year, saying, one idea I've been contemplating is that Bitcoin may be the key to extending Western civilization, which is something you only say if the price is going up. You don't say it if the price is going down.

It really feels like some degree of boom times are back, maybe not the same as 2021 But I mean, you're seeing it even in the long tail of the crypto market. There's a brand shiny new altcoin, to describe it politely, called bonk. And it's based on a meme of a dog clubbing people that get too excited. And bonk is up over 1,000% in the past month.

Katie Martin (3:21)

How are you spelling this, bonk? Bonk.

Ethan Wu (3:23)

B-O-N-K, bonk, right on the head.

Katie Martin (3:26)

Means something different in English, English, English, but whatever.

Ethan Wu (3:31)

You know, I will say, Katie, the last time we had all this hell of a blue on the way up, I felt like I had a certain youthful vitality to it, like I could be optimistic. And this time, I just feel tired. I don't know.

Katie Martin (3:41)

Crypto has won. It's finally ground you down.

Ethan Wu (3:44)

God, it really has. I will say, Katie, on the margin, I've been seeing just, you know, I follow some crypto influencers on Twitter, just to keep up. Well, with the zeitgeist, it's important.

And I've heard them talking about liquidity and interest rates a lot more this time than I ever did in 2021 or 22

Katie Martin (4:00)

I mean, not to get me cross, Ethan, but here's the thing.

These guys always want it their way. So when yields are falling, because interest rates are coming down, they're like, see, buy Bitcoin. But when yields are rising, because inflation is really high, then they say, see, buy Bitcoin, because it's an inflation hedge.