YouSaid · the spoken record

Chad Cascarilla

lines on the record: 69
first: 2019-10-29
most recent: 2019-10-29
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“This is a defined kind here. Let's say like loving or something, I think I'd have to say my wife agreed to marry me. That's the kind of thing that ever happened.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“And it creates a huge amount of leverage because you're now creating a software. Yeah, it's just software. And to be able to do that, you have to have a different way of approaching the problem because the way you're set up now is a lot of these large firms, engineering is called IT and did like a chief administrative officer. You're never going to be able to innovate your way out and really completely think about how to shift your businesses when you have that much weight of history.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“A perfect example would be like Amazon versus Walmart. I mean, you're basically create a lot of leverage to be able to how you interact with your customers versus having them necessarily come to the store. Another example would be like you go into a bank branch versus using your Venmo or whatever it might be. I mean, you're using Robin Hood versus calling up your broker. I think there's lots of examples of that where it's like here is a product you are able to use it. It's not about automating the work that a person is doing. It's actually like creating a whole different way you're able to interact with the service or product that you had before.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Can change their business when they have 100,000, 200,000, 50,000 employees and to reorganize themselves to take advantage of this new trend where you could suddenly deliver things in order of magnitude cheaper.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“I think one of the key lessons that I've learned is the difference between a financial service and a financial product. And I think to a large extent, the way the system has been set up, firm has been delivering services. And what's really going to change, and partly this will be from blockchain, but partly just as a general trend that FinTech is creating, is how can you deliver products? And if you have an open system and you're creating financial products, I mean, it could drastically change the way the system looks. If you have a closed system, I think you'll still move towards products, but it can happen more slowly because access is so restricted that you're still moving around the edges. But I think that is a really big difference. And it comes down to how you actually organize your entire business. Because solving problems from a service perspective is a lot different from how you would organize yourselves, what those problems are, how you organizationally think than if you're solving for creating a product. And I think it's not well understood. It's partly what's driving this change. And it's really hard for me to understand how”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“An open financial system. And I think it doesn't necessarily seem like that if you're sitting on the outside. But when you look at what's happening, you can imagine how if the rails end up being blockchains, private and public, who's going to be positioned for that? It's going to be the companies that have really been investing in the space, learning all the hard lessons, understanding product market fit, understanding what customers want and what problems they have. It's not going to be a somewhat linear optimization of the current system. And so I think that's laying the groundwork the next Cambrian explosion, hopefully one that's maybe a little bit more productive than the last one two and a half years ago or something where you had all these altcoin explosions, largely they proved to not be very valuable in their own right, but it laid the ability for us to now have, I think, a much stronger and big ecosystem, but it still has a long way to go. If you think about what kind of institutions are involved in the space now, still very few. I think that's actually one of the most bullish things going on is that it's still not that.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“I think things are in order of magnitude better in terms of the talent that's in the space, in terms of the companies that you look at, how many companies are doing custody, how many companies are creating wallet software. If you look at how many exchanges exist, you're significantly overbuilt for what the opportunity said is. You have large companies that have come in like Backed or Fidelity. You have incumbents that have been in place, like it's ourselves or Binance or whoever it might be, Coinbase, all these different incumbents that have been there, but it's only for $200 billion asset class. I mean, it's crazy. In some ways, you have more innovation and more exciting things happening here than all these other very large asset classes that exist outside. And I think that's because it's an open system. So it fosters a real competitive environment. You're out in the wild. This is not the zoo. This is not like some very contained environment. And all of that investment that's come through is actually creating a lot of this innovation that I think will feed and really hone the ability to create.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Now highest. So to define what that is for everyone, what percentage of the $200 billion of crypto market cap is related to Bitcoin. And so it's like 67% or I don't know how you calculate it depends everyone different ways. 69%. But the low was 25 or 30%. And so it's literally since January of 2018 till today you've gone from 25 or 30 percent to almost 70%. The result of that is essentially Bitcoin has gone up, but all these other assets have really gone down a lot. I think that was a really necessary and healthy thing, to be honest with you, because you had a million different protocols get created. And at the end of the day, Bitcoin actually pushed through that. So to me, that's a really interesting sign about Bitcoin. You had all these other things get funded, all these other possibilities.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I don't even remember how many. And usually they were always called the Bitcoin winter. This is a crypto winter because things have changed so much. I think you had all these altcoins that were created. And what's been interesting to watch is Bitcoin predominance.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think, yes, this quiet period, I think, was a nice way to say it. Nice way, Sam, the Bitcoin winter here, or the crypto winter. Now, I've lived through, like, I think this is the five or five”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, high transaction costs, title insurance, whatever it is, but it's also trying to change liquidity in real estate. I think that takes time because we have illiquid small cap stocks now. I think real estate is like an illiquid small cap stock. You can improve liquidity, but is it enough? I think you have to solve the process problems in real estate. So those are the two really big asset classes, real estate and public securities. And I actually think public securities is more difficult to solve from a regulatory standpoint. I think real estate is probably more difficult to solve because of the process problems.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“I think absolutely it's trying to turn securities into tokenized assets. That doesn't mean necessarily on a public blockchain, though there are private securities that are trying to do that, but also taking public securities and putting them on a blockchain. And the reason it's so interesting, but also so complicated is there's so much more regulation. And it's understandable why there is so much more regulation because you're talking about $100 trillion plus of assets are kind of publicly tradable securities even more. That's really, really exciting. It's really interesting. It's a big market. And then the other one is real estate. And everyone spends a lot of time thinking about how could you tokenize real estate? Could that remove the liquidity problem in real estate? And I think there's two problems in real estate. One is there's a process problem with lots of different middlemen involved because you have old paper databases, if you will.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“That's right. And I think it's a crucial way we're trying to build a business because that doesn't exist right now in the blockchain world, in the crypto world. How can you create an open financial system without the infrastructure that is in place to facilitate an open financial system? And that's what I think we're trying to really do differently and what should hopefully enable this world to be able to exist because it can't grow up from where it is now, where it is now is $200 billion of crypto market cap. How do you grow up to a point where you're really changing the way everyone's lives are? I mean, that's the real promise is that you can have a completely different system. But you're not going to get there without having highly reliable institutional grade infrastructure that people can build, businesses, and solutions and products on.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Already trading at that speed as more and more assets end up on a blockchain. Talk about this concept of $600 trillion of assets on a blockchain, public or private over time, you need to have all those dollars need to be on. There's $5 billion of dollars that have been tokenized, so to speak, but there's $15 trillion of M2, which is like kind of the total available amount that could be tokenized maybe. That's a huge difference over time. How do you get from $5 billion to $15 trillion? It's not going to be because of just crypto trading. It's going to be because assets are on chains and able to be moved and need the cash to move against it. And so we're agnostic really to people want to use gold. People want to use Bitcoin. Do people want to use dollars? We're trying to create a financial market infrastructure that allows assets to now be tokenized and be on a blockchain.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Is it similar to the gold product in that you send me a thousand dollars? I take that $1,000. It's either FDIC insured or I put it in T-bills as Paxos put in T-bills. I send you a thousand dollars on the blockchain. You can now send it to anybody in the world. Importantly, anybody who has an Ethereum wallet address. They don't even need to have an account with Paxos. So that means unbanked people can now have access to dollars. That's really kind of cool. Anybody with an Ethereum wallet has equivalent of a bank account. This is great for unbanked people, but it's also just has much higher utility when it's on the blockchain. Now, what is important is the network effects. So there's only so many people who are using blockchain cash that will grow over time. And so as that happens, it will grow outside of just the crypto world to be used in payments and FX and remittances, but things happen over time. There's adoption curves. The key part of the adoption curve right now for dollars that put on a blockchain are for crypto trading because those assets are”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, well, if you look at the way the financial system works today, it's based on dollars. I think 80% of transactions have the dollar on one side of it. So it's ubiquitously that people are using the dollar. Part of the problem with using dollars is that they can generally only move nine to five days a week. It takes days for them to move on international wires. It's costly. And so if you really want a financial system that can be in real time, you need to have money moving real time. And where you've seen this most explicitly is in traditional crypto trading because those assets are moving in real time. Bitcoin moves 24 hours a day, seven days a week. But how inefficient is that? I can send you crypto instantaneously. But if you want to send me dollars for that transaction, it could be days. No, when it's going to show up, who goes first?”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Goal bar. So that's what makes blockchain so interesting for gold, but also commodities in general is you're able to now take real ownership of the underlying asset, make it fungible, which means one ounce you hold and one ounce I hold are equal. It's completely divisible down to eight decimal places if you wanted to. But you have this ownership. You put a lien on it. You can get a loan against it.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“So, there's no way to now be able to move gold around. You're just getting exposure to the price, which is okay, but there's limitations. And on top of that, you have fees, you have to trade, there's costs. So if you looked at, for example, Pax Gold here, there's no custody fee. So you can hold it with us. We don't charge you at all for storage. Yet the pay to get it converted into a token. But now once it's a token, it's yours. You can move it around to anybody in the world. Again, 24 hours, seven days a week immediately. That's just a completely different situation and it's listed on a variety of different types of exchanges where you can trade it. They're all crypto exchanges. You can trade in any size. You want to buy fractions of a gold ounce, and it still relates to the bar. You want to own multiple ounces, hundreds of ounces. You can do that too. And if you want to withdraw the gold bar, you can do that. So you can actually get ownership of the real underlying asset. So not only do you have it legally through beneficial ownership, you can also redeem it for the”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, exactly. Now, let's take away that's one real tail risk reason people own gold. But there's other issues too with owning kind of financialized gold. It's only tradable on that exchange. Futures contract is only tradable on the futures markets. And the gold ETF is only tradable on the stock exchange that it's listed on. So that means you might only be available to trade seven hours a day when the market's open. And if you want to turn it into real gold, you can't do that unless you're a really large institution with an ETF or you are a really large institution with the futures where you hold enough and you could get delivery. So you don't actually really get access if you're an average person or even moderately sized institutions to the underlying goal of those products and you're trapped on those particular markets. They do have a lot of liquidity, but it's not the real underlying asset. And if you wanted to transfer your ownership to some other place, you can't really transfer. You'd have to basically sell it, turn into cash, and then send them cash, and they have to go buy gold somewhere else.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I mean, it also depends on, well, we could think of a number. Let's talk about it from a number of different perspectives. If you really want downside protection because you think financial markets are going to have a problem, and that's why you want to own gold, well, you don't want to own gold that's a financial product because the markets aren't working.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Settles immediately, and the fees are very low. You're selling it for a couple cents. I mean, what's the problem with gold? And by the way, this is probably the problem for almost all commodities, is there's a fundamental contradiction. You either own the underlying real asset, or you have something that's highly tradable and it's a synthetic. So let's talk about gold more specifically then. You either are trading the future or a gold ETF. That's not really gold, synthetic gold, or you have the gold bar and it's in your backyard. Guess what? You want to go sell a little bit of it. You want to dig it up out of the ground or take it out of some safety deposit box. Someone doesn't just buy it from you. They got to test it. They might melt it. Depends on how much it is. It's not obvious that that is still gold. And so you don't have this capacity to have something that's highly tradable, but also easily divisible and fungible and be the real thing.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“London, and it relates to the serial number of the bar. So you have actual beneficial ownership of a gold bar in London. And you can now take that gold ounce and you can send it to anybody. You can send it to your dad. You can send it to me or anyone else anywhere in the world. So the beauty of this is it's sendable 24 hours a day, seven days a week, instantaneously.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“That's exactly right. So you're giving us your assets to hold because you want them to be tokenized so you can move them around at a different way. And also because we created a ton of automation tools that allow you to very easily send your assets to us. And frankly, the way financial services works, most people wouldn't believe this, but as a general rule, almost all of it's manual. Emails, PDFs, whatever. So we created automation. So it's really easy for you to want to send your assets to us. And so let's talk about gold here. So you send me $1,500. And what I do is give you one gold ounce that's been tokenized. And tokenized means that it's on the Ethereum blockchain, which is a public blockchain. And I think a public blockchain is the right type of blockchain, not a private blockchain for gold, because gold is already a public asset. It's a public ledger. You wouldn't want to stick it on a private one. I think you'd lose part of the whole point of the value is that it's yours. And so you send $1,500 to me. I send you a tokenized ounce. That tokenized ounce relates to an ounce that's sitting in a brinks vault.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so one of the products that we've created, and maybe to even talk about what are we doing this a little bit differently at Paxos, we have this trust. We have a lot of other regulatory approvals that we've gotten, and it allows us to hold people's assets. And we hold their assets and we convince people to hold their assets with us because you can tokenize those assets with us. So you have dollars, we'll tokenize them. Gold, we can tokenize it. We're working on certain types of securities where you can tokenize them.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Changes in regulation and a change in the technological capacity to handle all these assets on one giant broad blockchain, and we're not there yet.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“A holder of record, or you have an asset that's residing on the Ethereum blockchain and you hold it. But anytime you want to send it around, you need to own some of the blockchain. And the same Bitcoin is similar. A private blockchain is slightly different. Someone is deciding who is on that. So it is gated in that way. And so there's a gating factor which requires some central person, whoever, to determine some gating effect. But anybody who's on that blockchain is now still able to interact with anyone else on a peer-to-peer basis. I think that's still a fundamentally more resilient place than when each step is requiring a centralized intermediary. So you still have a central person for sure in a private blockchain. Once you're in it, it's P2P. Whereas today, there's no P2P type of intermediation in what is a centralized and private and closed financial system. So how do you get to fully public, which I think would be truly the most elegant place to be? You're going to have to get there through a combination of”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, well, a public blockchain just for everybody is basically one that anybody can access the database. Maybe we should define a blockchain here. To me, a blockchain is a database. That's not to diminish it. That's a really cool type of database. But at the end of the day, it's a database. And what you're really determining is who has access to it. So a public blockchain is exactly what the name says. It's a public database. Anyone can access that database. You access that database by purchasing some of it. So in the case of Ethereum, you buy some Ether. You're now on the Ethereum blockchain.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“You would put, and you couldn't, by the way, right now, put everything on like the Ethereum blockchain. It's completely impossible. The system would grind to a halt. It's not capable of handling that. That doesn't mean, that's just really, by the way, I think an engineering problem. And that's one that will be solved over time. And it's one that'll prove out as performance over time. Part of going from where we are today to this point in the future is understanding what would you put on a public blockchain now and what might you do in the future. And so there's certain assets that I think should be on there now because they create benefits. And then there are certain assets that shouldn't. No one's going to put a public US stock. No one's going to put IBM on the Ethereum blockchain. Or frankly, all of US stocks, whatever 30 trillion dollars of US stocks, no one's putting that on the Ethereum blockchain anytime soon. You just couldn't possibly take that level of value and put it on something that...”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Is a really key point. So, Bitcoin right now is still early stages. It's like a $150 billion bug bounty program in a way. And it's held up, by the way. It's held up really, really well, but it's still early. I mean, you're 10 years in and you're not about to put $600 trillion of assets on a public blockchain, even with 10 years of kind of performance data. But on the other hand, I don't think this is something where you're like, let's put it all on today. It's going to be a journey over time. And I think some of it will end up starting on, and by the way, when you say a blockchain, it doesn't always have to be a public blockchain. It can be a private blockchain. So I think there's some logical evolutionary steps where you can show it on a public blockchain, you can show stuff on a private blockchain. It depends what exactly the problems that you're trying to solve. But in general, being in a distributed system allows you to turn control over to the users and away from centralized intermediaries. And that's the transformation that will happen. And so there's a lot more that needs to happen.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“$600 trillion of assets that move onto a blockchain, and that completely transforms how they move, who's able to interact with them, and the types of solutions you can create. It lowers the risk, it increases the ability for anybody to be able to be part of the financial system. It frees up capital. And that is a different way of building a system. And that's going to be the new system. That's going to be the new way people are able to use the financial markets.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Increase of your mode. And so it's a completely different type of way of holding people's money and assets. And the reason infrastructure is set up that way is because it's meant to be something that you can rely on and it's not risk-taking with your collateral and your assets. And so we went and created a trust company. We were the first company to do this in the blockchain and crypto space. This is May of 2015. We were approved by a New York Department of Financial Services. Ben Losky was the superintendent. So that was a big day for us. I think that was a big day for the space. And it allowed us to start the journey of creating financial market infrastructure. And to me, that is a world where assets migrate from a centralized place of them being held. It might be a Cobalt mainframe onto the blockchain world. So there are 600 trillion dollars of assets in the world. That's the big number right now. And I think what happens is over the next 20 years, maybe, I don't know, 25 years, you have”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“And so when we came to the crisis, we thought about blockchain, we thought about how this could change the system, the financial system, in terms of creating more resilience, creating more openness. And our viewpoint was you could create modern financial market infrastructure. Financial market infrastructure for an open financial system. And that was the genesis of Paxos. And the first thing we did in thinking about how you could create market infrastructure is look at how it's set up right now. And it's generally set up as a trust company. And a lot of people aren't familiar with the trust and trust companies, but they're basically like a bank except safer. And the reason it's safer is when you give money to a bank, this is sometimes abstracted away for people. When you give money to a bank, you're actually making a loan to a bank. They go out and make other loans and they make a spread and you have FDIC insurance, so you're kind of safe. But at the end of the day, you're a creditor to the bank. With a trust company, it's slightly different. You give money to the trust company. They hold it segregated in your name, bankruptcy proof.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“So, part of what we did in our asset management business was incubate businesses. And I remember seeing Bitcoin and then seeing the blockchain and saying, wow, this could really solve a lot of the problems that we saw that exacerbated the financial crisis. It can't solve the fact that there's too much debt in the system, but it can solve the fact that you don't know where your assets are. There's an example of Lehman Brothers fails, Barclays buys some of Lehman Brothers' assets. And to this day, this was even a couple years ago, like one or two years ago, they're assets that people hold at Barclays. They think they have like a Sally May bond, but they don't. They don't know where the bond is, which is kind of crazy because all the bonds are sitting at the DTC, but yet they don't know where the exact bonds are. And so what could blockchain solve? Well, where are the assets are? Who owns what when? That's what I think blockchains can really help in the financial system. Who owns what when? And that's not known right now. That's partly why we started Paxos.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“You do. I do. And we can talk a little bit about one of the products we created, which is related to gold. I mean, I think that gold is held a store of value for a long time. It's not a cash producing asset, depending on how exactly you hold it. It may even cost you, it costs to carry. End of the day, you go back over a long period of time. It's been able to hold its store of value. And what's it holding against? It's holding it against money on a real basis. So if you're like, I really want to be conservative, you could hold cash or you could hold gold. And I kind of look at gold as a more safe version of cash, especially as you have interest rates that are effectively at zero. So the differential and holding it isn't that much. So that's how I treat it in my head, which, and the idea is that'll give you spending power in the future when maybe asset prices change in a way that make them less highly valued. I don't know if they're overvalued, but they're definitely highly valued.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I mean, I would say on the one hand, I guess you'd call it, maybe you call it conservative, which is cash, commodities, and other real assets. And then on the other, what I would call a heavy.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“People talk about where could Bitcoin go. What they're talking about is you end up with an open system based on an open ledger. And that could be backed by Bitcoin or it could be backed by gold.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“That's why I understand. Yeah, I understand why people can call it a bubble because it has those characteristics of a bubble as a result of that dynamic. But I always tell people money is a bubble that never pops. And I'm not necessarily saying that Bitcoin is money, but it's a store of value. Like, I mean, why is gold have $8 trillion of value to it? Only because we say it does, it's just a ledger. It's an open ledger and it's not money. I mean, we call it money, and I can understand why people believe that. But really, at the end of the day, it's just a ledger. It's such a very good ledger that we've given it $8 trillion of imputable value. And it's probably still a better ledger than Bitcoin because Bitcoin is still new. But you can argue that something that is natively digital, maybe that's a better ledger over time than gold. And that's the bull case, I think, for Bitcoin. And if you ended up with a financial system that was both open and wanted an open ledger of record, you could use gold, you could use Bitcoin. That's the bull case when I hear.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“So much, but every day that asset is unwinding the very high discount rate and it should go higher. And so it's now been, what, 10 years? In another 10 years, let's just pretend that happened with 20 years while Bitcoin's existed. Something hasn't gone wrong. Now that's a long time from now. You could look at anyone who's 20 or 25 years old. They don't even know a world that doesn't include Bitcoin. Just imagine what does that mean the price would be like. And there's different ways of trying to figure that out. Now the downside is Bitcoin is still relatively young even at 10 years. It's still very highly technical. The code still has a lot of development that needs to be done in it. You talk to a lot of the core developers who'll say it's still in a beta phase. Something could come along that's even better as a store of value than Bitcoin. So that means it's not guaranteed that it will go up. But I think probabilistically even at 8,000, mile, this really makes a lot of sense and it has kind of such a pro-cyclical asset at 15,000. It probably has a better chance of”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Usage of it, how much unspent outputs are there, which is a way of tracking how much is going through the network, how much trading volume is happening. There's a lot of different kind of vital signs. And the vital signs, they would pull back a little bit, but they would then continue to grow. And so that could give you conviction. And while I would say my initial viewpoint of the Bitcoin blockchain was, hey, you can use this to put other assets on it. That's what makes this interesting. Over time, I certainly believe this now. It has a reasonable chance to be a store of value in the way that gold is. I don't know if that will happen. I think even if you talk to some of the most die-hard people, they'll say, we're not sure either. But I think there are good reasons why that could happen. And in some ways, every day that Bitcoin exists and doesn't go to zero, doesn't have something catastrophic happen, is a day it should go up. I think of it as a very high discount rate. And so I don't know exactly what the right trend line is because it gypsies.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think a couple things definitely unbelievable gut wrenching moves all the time. And I think there's a couple things you could look at fundamentally. One was how much was the network being used? So even while you had severe price pullbacks, you could understand if the fundamentals were still trending in the right direction. And that's what could give you some conviction.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, it's a public ledger for Bitcoin. Could be used for all kinds of different types of assets. And I still think that holds. But when I was trying to think of what could get you from $3 cents to $8,000, I thought it would be you're going to need to use this ledger for all kinds of things, not just as a store of value. That would just one use case of it. Now, that's not to, by the way, take away from the store of value premise of Bitcoin. That's just clearly what has taken hold. And there's other blockchains now that you would use as the ledger of record for a lot of good reasons, by the way. But when you're at three cents and I'm not a technologist, I not say I could understand all the deep algorithms that are used to keep the blockchain. Yeah, cryptography, all this stuff. I mean, I understand it, but not at just a level to be dangerous. It wasn't really well understood that you could even disaggregate something like Bitcoin from the blockchain and how you could create other blockchains and all kinds of different ways.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Was at three cents. Yeah. So I can tell you, I remember being at 99 cents and going, I just don't think we should be involved anymore. What's the risk reward here? Zero or $10 is probably priced about right at 99 cents. Now, obviously, that wasn't right, but we're having a lot of fun with it. But there was based on a premise, which I kind of mentioned before, which is that blockchain, which is really the ledger for Bitcoin.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“In an office, and so yeah, we were subleasing office space and electricity was included in part of the rent, and we were just like, all right, let's just have some fun with it. And we eventually upgraded some GPUs and some other more sophisticated mining tools.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“So, there's a newsletter, Elliot Wave. Yeah. And so Robert Prector had a newsletter. And I think it was the May issue of 2010. And I remember the back of the issue was about Bitcoin. And it's always colorful to read the Elliot Wave theorists, but it's outside the mainstream. And so I guess it wouldn't be surprising that they would point out Bitcoin. So on the back of it, there was maybe three quarters of a page write up about Bitcoin and how it was really interesting. And I remember giving it to my business partner. And we're like, wow, this is kind of cool. I guess we'll just put some Bitcoin clients on some of the computers that we have and see what it's like. And we were like 20 or 25% of the mining capacity at the time because there was nobody doing it. I mean, these are just CPU-based client miners.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so we're mentioning a little bit how we came through the financial crisis, and then it was May of 2010, came across Bitcoin, and it was just three or four cents at the time. And I mentioned before, I thought it was just going to probably go to zero.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“They're taking advantage of all this new transformation that's happening with technology. We're saying if software eating the world, how are you taking advantage of that opportunity in your investment portfolio? And then how are you creating a lot of stability and downside protection? And then I think kind of the broader markets, it's hard to be too excited about it. You have 1.7% interest rates or 1. whatever it is, 6% on the 10 year. Yeah, the 10-year probably goes to zero if they just keep printing money. And so you'll make some money there. And stocks can go up, but it's hard to understand that risk reward. versus, I think, being on a more barbelled approach. But clearly the best thing you could be invested.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it makes it a very difficult environment to invest. So I think one thing is you need to own outside assets, meaning assets that aren't someone else's liabilities. That could be like gold, that could be Bitcoin, that could be real estate. Now, a bunch of these things, even gold and real estate have a lot of leverage in them. So it's not exactly an outside asset. It'll be dictated by the constraints of the broader financial system and what happens to them. But I think that's one thing that you need to own, and that creates safety and frankly even cash. And then on the other hand, I think you want to own what look like call options, which is investments in businesses that can be very transformative and grow. And I kind of think private businesses or whatever it might be, having a portfolio tends to be a portfolio of call options because eight out of ten fail. I mean, early stage businesses, they generally fail. But if you're invested in the right mix, it ends up creating a very good return profile. So it's kind of having a barbelled approach, in my opinion, which is trying to own businesses where”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, because you have the retirees spending down capital compared to the workers. You see that in China, you see it here, you see especially Europe. I mean, Germany and Japan, you have absolute declines in the population. So that's unbelievably deflationary too. So it's hard to disaggregate some of these things, but deflating population sizes, if you will, against huge amounts of debt makes perhaps the contrarian call to be long stocks. What are they going to do in that situation? I think you're going to have to print money and you might call it something else.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Have all this flat screen TV capacity, but guess what? In the future, unless there's more debt, how are you going to? You can't use the capacity. So it's actually hugely deflationary. And that's what's maybe not understood. All this debt kept the system going, but it's built up an enormous amount of deflation. That's what I think negative interest rates show. All this money printing is just to kind of hold things together because there's so much deflation. I think they'll just keep doing it, keep printing to both incentivize the debt maintenance, but also because people are not capable of living through this deflation. And then the last component, which is really why this is a very complicated multivariable equation, is population growth is slowing or even turning negative, which is unbelievably deflationary too. And you haven't really had examples aside from like Black Death or something or whatever Roman times. What do you do when populations actually decline on an absolute basis? Now, that's not going to happen globally for some time.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source
“Deflation. The problem with inflation, which is why maybe you're right, the contrarian viewpoint is to be bullish here, is because they can't stop printing. The Federal Reserve just started doing QE last week, and it looks like it's going to be $500 billion, half a trillion dollars of QE. They're not calling it QE for a variety of reasons. The system can't function without more money printing to keep the thing going. And so the Fed's not going to basically allow deflation to happen that won't meet their mandate, which is 2% inflation as a goal. And because there's so much deflation built up in the system from so much debt, which is inherently deflationary. Remember what I say debt was? That is you're spending today, tomorrow's production or tomorrow's money. And so you've inherently made a lot of investment decisions based on the level of spending today as a business. So all of that investment that is made with the debt becomes a hole for tomorrow. An example of flat screen TV. Okay, a lot of people can get loans. They can go buy a lot more TVs. People build factories.”
2019-10-29 · Invest Like the Best · Chad Cascarilla – The Future of Blockchain and Financial Services - [Invest Like the Best, EP.145] · IDENTIFIED FROM THE TRANSCRIPT · source