Scott Melker on crypto tokens, Robinhood and the Clarity Act

[upbeat music] It's possible that we are all morons. You posted that last month. Were you right? Oh, yeah. We're all morons. We're all at least half moron. Do you have a Bitcoin price prediction for the next cycle? [beep] All of the things that seemed like pipe dreams and that people told us we were crazy for believing have come true. Crypto can still win even if Wall Street adopts crypto as its rails. Someone in a foreign country who has never had access to United States capital markets, who could never participate in the stock market, and can now go on any exchange they want and buy a real tokenized version of a share, and they can buy it with a stablecoin that's not in their hyperinflating currency, and we can build an entire parallel financial system to the one that already exists that gives access to everybody everywhere.

[upbeat music] Welcome to another episode of 51 Insights today with Scott Melker, AKA Wolf of All Streets. Scott, welcome to the show. Thanks for having me. Yeah, Scott, it's great to have you here. A lot of people know you on Twitter and online on YouTube. You're omnipresent. You've been in crypto for a very, very long time. But before you started with crypto, you spent 20 years behind the decks with Rihanna and Snoop Dogg and Wu-Tang. How does a guy like that end up as the most followed voice in crypto? Total luck, I think. It's an interesting question.

I mean, listen, I just aged out of, uh, of DJing, in my opinion. I mean, there's plenty of DJs out there, uh, I'll be 50 this year, who are, you know, 50, 60, 70 years old who are still doing it. But, you know, for me, I was 40-ish, and I felt like I was being forced into a room with 21-year-old kids every day. So, [chuckles] the transition was very natural for me that, that I had to get out of there. And at the time, I had just randomly discovered crypto. I was already trading. I had a background in trading from my years at Penn and just my friend group being Wall Street professionals.

And so I happened to just find crypto at the perfect time and, and because I'd built an audience for music, I started posting about crypto, and because I had a sizable audience for music, I think people thought that I was an expert in crypto, even though I was actually just a guy there trying to learn. And so it, it continued to build the following and it compounded. That, as I became more passionate about it, I think it just snowballed. I, I'm the kind of person who once I, I find something I'm interested in, I'm really all in on it to a almost an obsessive degree, and I became that way with Bitcoin and, and crypto at the time, and the, the following just grew, and I sort of organically went from, you know, I have an X following, let me start a newsletter, let me start a podcast, let me start a YouTube channel, to the point where I found that I was just talking about this stuff 16 hours a day every day.

[chuckles] A- and here we are. So I would love to say that there was some sort of master plan that transitioned me from music to crypto, but it happened organically. So y- you enter crypto early. From your perspective, how is crypto different today and, and why are you still at it every day? Why does it keep fascinating you compared to what it did 10 years ago? It fascinates me in a very different way because all of the things that seemed like pipe dreams and that people told us we were crazy for believing have come true.

The problem is that it hasn't necessarily benefited the assets that we thought it would when it came true. So there's this interesting bipolarity about seeing crypto adopted and all of the things we said would happen, but seeing a lot of that value accrue to Wall Street and to be cheering for institutions and the government who originally we were here to rage against. So it's a very interesting time. When I, when I got into it, first of all, I thought that everything was gonna go up all the time because I was brand new to it. I thought we were changing the world and that every single coin was going to go indefinitely up, right?

I, I certainly fell for the FOMO and the narratives and all of those things, and with time, I've culled most of that nonsense and have focused primarily on Bitcoin and a few other select assets to a much smaller degree. So I think, you know, when I came in, I was one of those people who was trading everything, buying everything, believing in everything, and I've really, uh, honed that into just a few select assets. But I mean, it's entirely different. It was a complete pipe dream back then, back then. You know, I, first of all, I got in in 2016, so I thought I was late.

You know, you describe me as early, being here for a long time. It's all relative. I was always jealous of the 2014 guys, who were jealous of the 2012 guys, who were jealous of the 2010 guys. But, you know, at that time, I really thought that it could replace the financial system and that Bitcoin would become the new global reserve currency. I k- kind of, you know, drank the Kool-Aid. Now I think it's more of a parallel system that fits into the greater system, and that, that greater system is very close to co-opting a lot of, uh, what we are passionate about.

Yeah, and then when it comes to tokens, how did your investment thesis change over those last 10 years? You said y- you started with all those tokens, and now you're only looking at Bitcoin and a few others. Why did you change your opinion on that? Because I started to fundamentally value them based on their utility and what they actually do and the earnings that they accrue and their likelihood of gaining the network effect that will keep them sustained for a long period. You know, I think that there's a select few L1s that have sort of jumped the creek as far as adoption.

Obviously, Bitcoin, I think, is an asset of its own. Then you take the Ethereums or Solanas. They have ETFs, and they have institutional adoption, and they have institutions building on them. By the way, these are not the things I thought I would be cheering for, but it's the reality of the current situation. And so there's broader access to the entire investable universe for some of those, and they're actually being adopted for things, right? And then you have newer assets, which by the way, I don't even own most of these, just, uh, speaking sort of in a vacuum.

Zcash has c- captured the privacy narrative and has, has gone kind of wild. Hyperliquid does massive buybacks, and there's real utility and real usage on the platform, and I think any investor can look at Hyperliquid and say, "Wow, this is how much money they're earning. This is how that's accruing back to the token." In the past, we just fell for a whole lot of ideas that were basically Engineered to enrich insiders and early investors and eliminate retail, and unfortunately learned the hard way that good ideas or even mediocre ideas with a white paper and no product did not justify valuations higher than some of the largest companies in the S&P 500.

[laughs] Uh, so it was just, you know, uh, people- things were being priced on the best possible tenure time horizon scenario of what they could be and not what they actually were, and that's why they're all down 99.9%. Yeah. And Scott, I 100% agree with you. We published an article about four weeks ago called "There Won't Be Another Cycle," and there we have a similar view. A- and I share that with you, that as a person who's been in the industry for over 10 years now, all that hype that we saw at the beginning and all these layer ones and, and all these VCs that came in and, and basically are able to fund companies that wouldn't be funded elsewhere on a public market, that couldn't raise money otherwise, and these VCs did it because they had an opportunity to do that and then cash out through crypto markets and exchanges at the cost of retail, right?

Instantaneously. Right? Exactly. Yeah. The, there, there was a point in the cycle in late '20 and early 2021, and I was seeing a lot of the deal flow and, and was, you know, participating in some of this, where a VC could literally write a check and have liquidity two weeks later because they were the last check in and a token was launching. There was no product, but there was a token, and maybe they got their first 15 or 20% tranche of that token immediately at the TGE or the token generation event. And yes, then they vest for two to three years after whatever the tokenomics stated.

But they could probably, if this thing launched with enough hype, they could 100X on the first 20% that they took out and then forget they ever owned it, and it was an investment they made a month ago, right? It turns out that there's actually reasons to have delayed vesting for VCs so that they will actually add value as opposed to just dump on retail the second that they get a tranche of tokens. So it was just structurally broken, and I'm hoping that whatever the next cycles look like, I, I, I 100% agree we'll never see the same cycle.

I don't think we'll be able to throw a dart and your token goes up 100X just, just because it's part of the crypto market or is it a sign of narrative. But I do think there will be a cycle, but it will, the value will accrue to utility and earnings. Yeah, I, I agree, and, and that doesn't mean that nothing in crypto has value, but it means that certain projects, like for example, Hyperliquid, which is very interesting, maybe we'll talk about this later. Projects like that who generate real revenue will actually accrue value, and a lot of things we saw in the last 10 years were actually pipe dreams- Yeah ...

at the cost of, of retail, yeah. And, and the, the reality is, and I think this was the hardest realization, was that 99% of those didn't need a token. Mm-hmm. Right? Like, what- Yeah ... why, why do these projects need a token attached to them? Well, it was because they, they could raise a whole lot of money fast and make money. I mean, there's projects, you know, from the ICO boom, I don't even wanna name names, but that raised billions of dollars and never created anything. Yeah. And literally walked away with billions of dollars because they fundraised.

Now, even the best iterations of those raised billions of dollars, and maybe now are deploying that capital that they've used, that they've earned from selling the token to then build legitimate businesses. But I mean, think of it in terms of like if, if Bezos or Elon Musk or something had launched a Tesla token instead of launching the cars. Made, you know, $10 billion and then used that money to fund building the cars 10 years later. [laughs] That's your best case scenario, right? The, the incentives were just literally reversed. You could cash out on your idea before you built a single thing, and most of those things didn't even need a token to run in the first place, and tokens were sort of this fake version of stocks or equity with none of the protections.

Yeah, exactly. And, and, and the fact is a lot of these projects wouldn't have survived in the open market. Um, and, and Scott, I assume you have a lot of also retail investors following you. What are you telling these investors right now trying to understand what's going on in crypto and what are, what they've been doing over the past years? Well, first of all, I just say dollar cost average into Bitcoin and forget about it, so that's my only financial advice that you'll ever get from me, and that's probably too much financial advice for, for most people.

But what I tell them t- how, when I'm looking at the market, price aside, I think that this is the best it's ever been. Which is an interesting conversation when you know that price was at 126,000 and select altcoins are down over 90% from their peak. But when you actually zoom out and look at fundamentally where we're at, it's almost unbelievable. I mean, the largest institutions on planet Earth are literally adopting blockchain technology. The DTCC talking about settling quadrillions by 2027 in tokenized assets. We have conversations in the House about a strategic Bitcoin reserve and de minimis tax exemptions, and they're debating, for whatever it's worth, the CLARITY Act.

I mean, everything the industry could have ever asked for is basically coming to fruition. It's just that price hasn't necessarily reacted to it yet. So I always joke that the best marketing for Bitcoin is one big green candle, right? The, nothing, nothing gets people more interested in Bitcoin than higher prices, unfortunately, or any asset for that matter. So when Bitcoin was trading at $60,000 and you said that it was a good debasement trade or a hedge against irresponsible monetary policy, people said you were nuts. A week later, when Bitcoin was 80,000, it's in the mainstream media and on Bloom- Bloomberg as the greatest asset for the debasement trade, right?

And nothing has changed except the price. So I, I think you have to zoom out, ignore the price, assume that if you have a low time preference and you look at it over decades, that it's going in one guaranteed direction, and that's up and to the right. So I view 60,000, 65,000, $75,000, $80,000 Bitcoin as a Literally like liquidation sale when I know where I, well, where I believe that it's going, which is much, much higher with time. I just don't need it to be there next month. Mm-hmm. Do, do you believe the bottom is in already, or do you just don't care about this?

You just dollar cost average. I don't care. And so I don't care. In fact, it's funny because I've been buying, I've-- I was buying at 126. I bought all the way down to the 60s. I manually bought a lot more than I was dollar cost averaging in the 60s. And every time I get money, I wanna buy, take some percentage of that to buy Bitcoin. I personally would rather buy Bitcoin at 40,000 than 80,000. So I would welcome a lower, lower low, right? Uh, because I believe it's going much higher, and any price that I can get is lower.

That said, when it hit 60 in February and kinda broke through it, my base case and the one that I've been promoting effectively ever since, once again, just my belief in what will likely happen, but, uh, nothing guaranteed by any stretch, was that the bottom was in, and we would spend the next... I think I said back then, "We'll probably spend the next six to nine months chopping sideways and driving people insane." First, you get the price capitulation, when people freak out and they say, "It's broken. It's going to zero. It's 60,000. It has to go to 50 or 40." Then you get the time-based capitulation, which is you get there, and then you stay really, really boring for a very long time, and the people who believe just start to give up, especially when you see AI going crazy and gold going crazy and silver going crazy, and there's greener pastures everywhere, right?

And so I think that we've been in that phase, and we saw a bit of a regime change about a month ago when it went from the 60s up to, you know, almost 82. And from a technical perspective, I don't think that ended the bear market. I think it got us much closer, and it's time to pay attention. But you can't ignore the largest liquidation of shorts in history and a 24% move in a week and pretend it means nothing. So to me, I think the bottom had been in for a very long time, or that the bottoming process had begun, and we got more confirmation of a likely bottom when we saw that big move recently.

Yeah, and I, I agree. I thought the same. I thought we were gonna continue with that kind of market for the next six month. I lived through a, a couple of down cycles to now, and it was always the same, like you said, capitulation. No one is talking about it anymore. People leave the industry. And that's what I felt what was happening until I saw what's happening on Robinhood, and that's almost like a, a mini renaissance of DeFi on this new Robinhood chain and potentially also connected to pushing the Bitcoin price higher. Have you followed what's happening in Robinhood at all?

I, I followed it closely. Okay. I haven't participated in it, uh, but I think it's an intellectually interesting experiment. And, you know, I've interviewed Johan about it and Vlad about it in the past before they launched. So yeah, I would say that I'm, uh, watching from a distance and observing. [chuckles] But what, what, what's your, what's your take on that? How does that look like to you for someone who's been in the industry for, for such a long time, who's seen these meme, meme coin manias come and go? Um, but what, what are your thoughts when you look at Robinhood chain?

So I think that with anything in crypto or markets in general, specifically crypto, you see this first hype bubble in anything, right? We had the DeFi summer, for those who remember, when literally DeFi at that point wasn't talking about yield and loans and, you know, institutions finding 4% yield for the customers. We were talking about farming yams to trade them for tacos, to trade them for potatoes, for whatever other nonsense, right? And that was sort of the first iteration of DeFi, and it had its hype cycle, and it collapsed. We saw it with NFTs. We saw it when, uh, Facebook rebranded to Meta, and all of a sudden, anything in crypto that had a metaverse attachment went absolutely nuts, 100x, and obviously came all the way down.

And people were buying real estate next to Snoop Dogg in the Sandbox metaverse bec- Right. You, you-- Like, you get the insane kind of hype cycle. And I think what we're seeing on Robinhood right now, although it echoes previous meme coin cycles, the attachment to actual stocks and the sort of novel approach that it's giving to push the real-world asset and tokenized stock narrative, I think is novel enough and interesting enough that it's the first iteration of something that will be much larger in the future. So I anticipate, and I think we've actually already seen it, right?

You had this massive pump on Robinhood chain, and then you saw kind of all of those meme coin assets, to my knowledge, drop dramatically. People will leave, they'll go to other places, and then we'll see what the real version of it is in the next sort of cycle of, of that cycle, cycling up. But I think that the, the real signal is that it's Robinhood, right? Because nobody better to test that theory than that specific platform. Because they, not only are they, I mean, they're fully a crypto company to some degree. I mean, someone would say crypto adjacent, but right, they, they kind of launched obviously as a stock exchange, and they brought options and speculation to the masses.

I think it's fair to say that. But they were really, even before meme coins, were kind of the meme stock craze that was driven there, right? GameStop and AMC and all of these things. And so they have the crypto side, and they have sort of the meme, meme and speculation side and have built-in everything exchange for all of that. So now when they launch something like a Robinhood chain, they get the crypto degenerates coming in from one side, migrating from Solana and Pump.fun and all these things. But they also then present this to their millions of customers who have not participated in crys- crypto and have simplified the UX/UI enough that those people will go participate without necessarily feeling like it's this complete foreign world that they don't understand.

I don't know if you've tried, so I did, like, you know, getting money from a Robinhood account to Robinhood chain, right? So, like, I don't participate, but I bought one Robinhood meme stock just to say I did it, and they airdropped me some S&P as a part of it. Of course, I'm down horribly, worse than whatever airdrop I got. But I just wanted to see the mechanics of it. And getting money from Robinhood to Robinhood chain, from the exchange to the wallet, is simple enough that my mom could figure it out. And that's a real serious unlock, I think.

And I don't know if you've seen, but it's in DeFi, but they offer actually an exceptionally high yield. I can't remember if it's six, seven, eight percent, whatever it is, but passively effectively, and that's happening in DeFi on crypto, but they've presented it in a way that doesn't feel like that. Now, we can decide... We can discuss whether that's disingenuous or, or what that actually means. But there are millions and millions of customers can now click a button in their app and say, "I wanna earn passively on my yield," and they don't necessarily have to think, "Oh, I'm going into crypto and taking crazy, crazy risks to do it." So I think, like, they're the platform that has the right kind of user that's not necessarily crypto native to push that next level of DeFi.

Like I said, we'd have a debate whether that's good or bad. I'm not taking a position necessarily there. I'm just speaking in a vacuum. They're well-positioned to be sort of the catalyst for that next move on that side. And by the way- Mm ... it's not that weird that in crypto we've come to this place where portfolio construction or what people are excited about is a barbell, right? You have very serious things on one side. You have Bitcoin. For me, it's Bitcoin, but may, may, maybe you add the Hyperliquids or the Ethereum and Solana, right?

These serious institutional assets that they're talking about on Wall Street. Everything else in the middle is this skinny bar that nobody's interested in, coins, you know, ten through one thousand on CoinMarketCap. And then the speculators are entirely on the other side of the barbell, going nuts in their own world that none of us can even understand. Yeah. That's a, a very good analogy. So definitely when I hear you, it's UX, but it's also connecting, connecting it to stocks, and I, I feel like Robinhood stole the show from Coinbase with Base and also from Solana. Were you ever part of these ecosystems, Base or Solana?

No. I mean, I own Solana, and I believe in Solana, but I was never, quote unquote... I, I don't know if your audience how crypto native they are, but, you know, the term is in the trenches. No, like, I, I have kids and a job and a life, so I don't have time to, you know, watch meme coins launch. And I'm not begrudging those who do, but I've never been a part of that sort of side of the community. But, uh, I also think that those rotations are very temporary. Like, it's way too early to say that they've stolen it from these people, and it's gonna stay there because people would have told you that Solana had just stolen it a month before or that Ethereum had just stolen it with Base a month before.

That market, those are the same crypto degens who have been here trading against each other, you know, like pumping and dumping on one another, and it's basically a video game. And they just rotate where the vol-volume and liquidity are. And so that can very easily bridge right off Robinhood chain to somewhere else. So I think Base might be struggling right now, but I wouldn't bet against Coinbase, right? They're as crypto native as it gets. I think they can see what's happening elsewhere, and they will adopt and adapt and, and move on. So I'm sure all of these ecosystems will see their rotation.

So as it looks now, it's probably safe to say, yes, it was a smart idea to launch their own chain for Robinhood. But speaking about that, we have a lot of layer-ones now. We have Solana, we have Coinbase's layer one, we have Robinhood's layer one, we will have ARK launching this week. How do you look at that layer-one landscape also from your perspective as, as, as a Bitcoiner? How will all of this play out? Will we even have layer-ones in the future, or will it just merge into- We will ... Bitcoin? I, I think it's...

No, it won't merge into Bitcoin. I, I think that it's funny 'cause five years ago, if we sat down and had this conversation, we would talk about all of the adoption that was coming and how we didn't have enough block space, and we needed more layer-ones because the layer-ones that existed could never accommodate the billion people who are coming on chain. Now, you could bring a hundred billion people that don't exist on chain, and we would have too much block space for all of them because we have too many layer-ones and layer-twos that don't need to exist, right?

So it's entirely flipped, uh, and the premise was wrong, right? So I think that most layer-ones become zombie chains and completely disappear. I think most layer-twos become zombie chains and completely disappear. I think we see a consolidation into the bigger names and those like a Robinhood or a Base that have a major institution behind them. ARK is really interesting 'cause it probably speaks to the last question you had about rotation. I would not be surprised to see all the Robinhood meme traders go start launching things on what's supposed to be a very serious blockchain for Circle and, uh, you know, stablecoins on ARK.

Because the nature of crypto is if you see a greener pasture and you see the opportunity to build the next Hyperliquid or the next dog coin or the next cat coin in a new place, people are gonna go try that. So actually, like, I don't know when this will come out, but the prem- the idea that maybe Robinhood chain will cool off because ARK is launching is something I could probably, in real time, I'm thinking about get behind likely happening, right? And so, I think, like, a chain like ARK will probably do well because, in theory, whether the meme coiners come over, they love when they do, by the way.

So all the serious people say, you know, "Meme coins stay away." Vlad said that originally with Robinhood as well, right? But they love the volume. They love the liquidity. They love the attention. It brings some action to the chain. It drives, it drives it. But ARK is supposedly fit for purpose, right? It's supposed to be a very specific chain for stablecoin. I think Circle and any publicly traded company in crypto, but specifically stablecoins, like they have a bit of an existential problem, which is that Circle's revenue is effectively just interest rate exposure, right? Same, same for Tether, obviously, but they're not publicly traded, so they don't have to answer to shareholders.

I don't think it matters if Tether makes five billion or one billion next quarter, right, which will be determined by interest rates. But for Circle, who's publicly traded, and you look, and I don't have the numbers in front of me, but let's say ninety percent plus of their revenue simply comes from custodying the dollars that back USDC, right? So somebody, you know, uh, they, they create USDC when somebody deposits dollars with Circle. They put that money into short-term treasuries, highly liquid things, a small percentage in cash, and they earn money by holding that For you, with high interest rates.

If interest rates, interesting, 'cause we now think interest rates might go up, but it, if interest rates actually come down to 1% or a zerp environment like we've had in the past, Circle's revenue disappears, like entirely. And how are they making money if the money that they're holding isn't making money for them? Mm. So they need to make money with transactions. They need to make money with their blockchain. They need to make money with new novel businesses that they create over time as interest rates inevitably come down. So I think that Ark will probably do well, and I think Ark has to do well for them because it's part of that business to replace the revenue from, you know, high interest rates and holding treasuries that's inevitably going to come down.

So I guess the, uh, it doesn't really, didn't really address your question, but I think there's a consolidation into the Solanas and the Ethereums of the world. I think the smaller L1s, maybe they become, like, some very specific chain for a very specific pur- purpose. Like, they hyper specialize in something, an NFT chain or a DeFi chain, whatever it is. Uh, but I think that the value is going to consolidate and accrue, and I think when you have these big launches like this, they're gonna probably do relatively well. Mm-hmm. Doesn't mean the token does well, if there even is a token.

Like Base doesn't even have a token, right? But, uh, I think that there will be actual activity. Yeah. And, and 100% agree on Circle. I think their strategic position of getting away from that stablecoin revenue that they generate, by the way, they, I think they need to hand over 50% of- Coinbase ... of that to Coinbase. Exactly. So it's, it's already not big enough if you compare it to Tether, but it's getting smaller every month, it looks like. A- and, and they need to find new revenue streams, right? Yeah. I don't know if you saw, but not only that, so people don't realize, like, the deal that Coinbase and Circle have, effectively 50%-ish of the revenue goes to Coinbase.

But Coinbase also just joined the open USD consortium, which is in direct competition to Circle. I didn't know that. Wow. They, they re-upped their deal with Circle. So this, this announcement came before they re-upped the deal, leading to speculation they might not do their deal with Circle. Of course, they did, 'cause it's still mutually beneficial for both. But then there's this consortium that's led by Stripe and their blockchain, Tempo, of all the payment companies, 20-something of them, and Coinbase is one of the partners of that, and it's a direct competitor to USDC, so. Wow. So this is definitely interesting what's gonna happen there, uh, with Ark, but also Tempo.

Uh, Tempo is still to, uh, come, still to launch. And then speaking of, uh, L1s, I saw that Ran Neuner, the founder of Crypto Banter, told you that L1s, the L1 war is over, and Solana and Ethereum won. Do you buy that or, or what's the alt that you think is actually worth owning here? Well, I, I, I think it's slightly overstated, but directionally correct, right? So I think that of the existing L1 blockchains, they have won. I think that that's a fair assessment. But like I said, with Ark launching and Tempo, these things can do exceptionally well without necessarily even having to capture the value that's already on Ethereum or Solana.

Ark can do well because there's massive growth in stablecoins and USDC grows massively, and the, the, that value can accrue to their chain. Same with Stripe doing payments on Tempo, right? So, but for the sort of everything L1s, I think that they have dominated, and there's little reason to believe that a new upstart that does something very similar could really compete long term. Mm-hmm. All right, so let's talk a little bit a- about the trenches. Scott, you're definitely a, a guy who's also in the trenches. You're, you're at many places, but also in the trenches.

How does a day in your life look like? I'm in the, the real-life trenches, not the, uh, crypto meme coin trenches, I, I think. My every day is relatively busy, but heavily front loaded because, uh, I like to keep my afternoons free to, to spend, the late afternoons, to spend time with my kids. So really, it's very, very early mornings. I wake up, try to be at least two hours ahead of the family so that I can write my newsletter, do all my research for my shows, kind of get a lay of the land for the day.

Then I do the, you know, dad thing. You know, I get them up, I make them breakfast. Sometimes I drive them to school and, and get to the studio. We do the 9:00 AM live show on YouTube, and then, uh, have The Daily Wolf at noon. So right through from, you know, f- let's call it 4:30 to 12:30, it's nothing but content and a little bit of parenting. After that is when I can do things like this and then record my long form podcasts for the weekend, record all the extra content that we do, actually have meetings and do business and run the organization.

So it's, it's very busy, but I try not to be working at 7 or 8 o'clock at night so that I can be hanging out with my kids. And so, yeah, I, I'm very busy. I, I work very hard, but I'm, I think I'm very good at compacting it into, you know, relatively few hours, or at least the first kind of half to two thirds of the day. [laughs] Yeah. Yeah. And, and today was definitely a little bit of a special day because today is also the CLARITY Act vote. Just about in one hour from now, recording time, this is gonna happen.

And I saw you tweeting about it all morning already. What's the current state on the CLARITY Act, and what do you expect? I think Mitch McConnell is the perfect, you know, like, uh, meme for the CLARITY Act. Like, they're rolling in the dead guy to try to get it done. So maybe, maybe it is dead because I don't know if it's dead or it's less dead because they got one more Republican to vote for it. So, uh, it's interesting. So to be clear, and we'll know the result of this when this comes out, sort of as you alluded to, right?

But today is just a procedural vote. It's a motion... It's, it's effectively a vote to decide whether it's worth debating and voting on the CLARITY Act. So anyone who's looking at prediction markets and wondering if they're gonna settle today, has the CLARITY Act passed, they're cr- incorrect. A lot of the media is covering it as today is the vote on the CLARITY Act, but this really is the first step to see if it's even worth debating. So- I, I don't believe the CLARITY Act is gonna pass any time soon personally. I haven't for a very long time.

I would love to be proved wrong, and I have no problem being wrong. I think that would be to my benefit. But I just don't see how it makes much political sense for the Democrats at this point to come over and give Trump a win, and I think that the ethics clause has always been the sticking point. I've been saying that since before they even discussed the ethics clause, that we hadn't even gotten to the important part, which was ethics. And even with the concessions that Trump has already made, right, to, to now, he's... The, the Republicans came up with an ethics plan.

He agreed to the majority of it. They presented it, and the Democrats continue to just say, "Doesn't go far enough, doesn't go far enough, doesn't go far enough," without really saying what would go far enough, right? So I think it's just become a really toxic political issue, unfortunately. And so I think it's reasonable belief there's a chance that the vote today could go well because, for a few reasons, and I'm gonna be proven probably entirely wrong by this. I'm not saying this will happen, but I'm saying these are the ways I could see it pass today, is that, A, the crypto lobby is exceptionally powerful.

So I think any Democratic senator will think twice about voting no if they think that it's going to cause the political lobby and Fairshake to spend millions of dollars against them in the midterms. So if you're up for midterm election, you're gonna be very careful voting against crypto if you don't have to, right? So, and the other thing is that if they really are still in good faith negotiations over the deal terms of this, it makes sense to vote yes today, even if you intend right now to vote no in the future, because it keeps it on the floor, it keeps the debate open, and it allows there to be more conversation about these actual details that they're going back and forth on.

So I could definitely see seven Democrats saying, "Hey, I might vite- vote no on clarity, but today I'm gonna vote yes and put forth a good faith effort at negotiations." So that's kind of how I see it right now, why Democrats would vote for it. The fact that they rolled out Mitch McConnell when that now takes the Republican vote from 52 to 53, and it means there only need to be seven Democrats instead of eight. Watch there be exactly seven Democrats and not eight today, right? Like, if Mitch McConnell didn't vote, it doesn't pass, but if Mitch McConnell rolls out there, you know, a Weekend at Bernie's style, then we get the, uh, we get it passed with exactly 60, right?

So I guess to, to give the shorter answer at the end of that long answer is maybe it passes procedurally today. I would still be very surprised if it actually passes with anything like its current form in the future. Mm-hmm. Yeah, and, and the ethnics clause is something that's apparently very important to you. I saw last week you wrote that, I'm quoting, "Fuck the politicians and their families who are grifting off of our industry." What tipped you over? I said that? That doesn't sound like me at all. Uh, yes, I did say that, and that was Hunter Biden Laptop.

So, like, uh, Hunter Biden launched a token last week called Laptop. Given it was, like, kind of a paper pump, but it went to 140 billion. You know, it was like would've been one of the most valuable co- companies in, in the United States, uh, at its valuation with only $50,000 of liquidity, and people bought it, and, you know, it obviously went down 99%. I don't even know where it settled, but it was yet another grift by a politician's family to make a ton of quick money. Now, he says that he didn't make a ton of quick money.

He's locked up. I have no idea what happened. Either way, people who bought it got hurt, bottom line, right? And I would say that in a time when the crypto industry was exceptionally excited about the Trump presidency, that sort of Goldilocks moment from his election to his inauguration, when the anti-crypto army was dead, it was politically unpalatable to be anti-crypto. People really believed Donald Trump was gonna be a crypto president. When he launched that meme coin, Trump and Melania, of course, three days before the inauguration, I was probably one of the most outspoken voices against that, which was extremely unpopular because he was so popular and, you know, he was the godsend to the crypto industry, and I think I was proven right.

You know? Like, I'm wrong about a lot of things, but the president launching a meme coin at 8:30 on a Friday night, three days before he's inaugurated, when he's not beholden to the emoluments clauses that would ban him from doing that three days later and all of the money his family's made on it since. It's what you get with Trump, right? You get, uh, you, you get the, you can't have the good without the bad, I think is a fair way to say it. So you do get, if we're calling balls and strikes, like, a very pro-crypto regulators.

Everybody in that government seems to understand Bitcoin and be pro-Bitcoin, that SEC Atkins gets it, and Celia at the CFTC gets it, and Bessent at Treasury gets it. It's really incredible, but he's also doing it to enrich himself, and that's the reason that we're stuck here for the CLARITY Act, right? So if he had never launched meme coins or participated in the industry, the CLARITY Act would be passed. We wouldn't even be talking about it. The reason the CLARITY Act can't pass is because [laughs] Democrats can't vote for something that allows Donald Trump, in their mind, to continue to make money on the crypto industry.

And then you throw Hunter Biden in it a week before the CLARITY Act, and it's, you know, it's just hard to, hard to accept that, uh, there's that much grift in this industry. And listen, it's in, it's in all industries, but it would be intellectually dishonest not to say that this is a special crowd in crypto for finding novel ways to liquidate people's funds. Yeah, so it, it definitely stays interesting what's gonna happen with the CLARITY Act today. Do you think it's gonna change anything if that doesn't pass today? No, I, I don't care at all, and I, and I haven't cared for a really long time.

So listen, if you believe there was, like, a 90% certainty it was going to pass and it doesn't, I think that's a big deal. I think the market has generally priced the CLARITY Act not passing, and, uh, more importantly, I think even the people in power have priced the idea of the CLARITY Act not passing. So you have effectively two ways to get things done in the United States government, right? There's the legislative side, which is the more important, and I'm not gonna discount that because that's... If you pass a law, it's the law for a very long time.

If you- Write rules as a regulator, or you write executive orders as a president, those things are much easier to reverse when the other party takes over inevitably a few years down the road, right? So I would prefer the legislation. That said, you have Atkins at the SEC and Selig at the CFTC saying very clearly, "Regardless of what happens with clarity, we are pushing forward, and we are gonna write rules that are favorable to the crypto industry." And they've shown that they will do that from day one. I mean, the SEC, even pre-Atkins, was already rolling back all the Gensler era, you know, all of the lawsuits that they had brought, and the Wells notices, and SAB 121, which, you know, banned large institutions from custody and crypto assets, or at least from viewing them as an asset rather than a liability.

A lot of the ridiculous things that happened in the Gensler and Biden area were immediately reversed. But that shows you that anything that's done by Atkins and Selig can be reversed, right? So I think we're gonna have a very favorable environment from a regulatory perspective for the next two to two and a half years. Uh, and then the question, I think maybe the onus then is on the crypto industry to actually become so big and important that it's not worth killing in two years, right? But, uh... So I think that we will get most of what we wanted from clarity from the regulators.

It just won't be as lasting without it being proven necessary. And, and, and Scott, if, if crypto ends up as Wall Street with better rails, did crypto win? Interesting question. So more specifically, I think that crypto can still win even if Wall Street adopts crypto as its rails, because there's still all those people who are unbanked and who do not participate in Wall Street and who believe in these things, and it can truly benefit. So I think they're parallel questions, uh, for future parallel systems. So I don't think that it matters to Joe Smith in wherever if the DTCC starts to settle on blockchains instead of, right?

Because it's not that interesting. It's incredible to say, "Hey, this was a better, faster, cheaper technology that was adopted," but that doesn't really accrue to any investment that your average person can make. It's really boring. It's actually just a replacement of plumbing and infrastructure, right? What's more interesting is someone in a foreign country who has never had access to United States capital markets, who could never participate in the stock market, and can now go on any exchange they want and buy a real tokenized version of a share, and they can buy it with a stable coin that's not in their hyperinflating currency.

And we can build an entire parallel financial system to the one exists, that, that already exists, that gives access to everybody everywhere. So yes, the more adoption that it gets, the better it is for everybody because more people will be familiar with it, and it will give access to more assets and more opportunities. But it happening on Wall Street is just kind of, uh, gives more confidence that that adoption will happen, but that to me is not particularly exciting or investable. Like, I don't care if JPMorgan settles with Wells Fargo on a tokenized bank deposit on a weekend.

That does not excite me, right? It happens. Does not excite me. But it excites me if, you know, a guy in Nigeria can buy, you know, pre-IPO Anthropic and make a lot of money. Probably won't if he buys pre-IPO Anthropic. But for example, you know, or trade these markets or gain access to the Tesla stock that he could never buy and keep that in the same account where he's, has stable coins instead of his hyperinflationary currency. Oh, and by the way, he's using Bitcoin as his savings account, and it's all in the same wallet. That's an awesome future that I can really get behind.

Yeah, definitely agree. And it's interesting, we're gonna have Nadine Chakkar from DTCC, uh, later on the show as well. So, uh, I'm curious what she's gonna say about that as well. So, uh, Scott, we're almost at the end of the show. We usually do a short lightning round. Short questions, short answers. The first one is, it's possible that we are all morons. You posted that last month. Were you right? Yeah. We're all morons. At least partially. We're all at least half moron. I mean, listen, there's a, you know, like there's a lot, like it, it, it comes back to sort of the Trump question, right?

Like I've... You defe... It becomes increasingly hard to defend the industry when you have to defend the whole thing writ large, and you can't get into the nuance with people, right? So I, I can't blame someone when they look at crypto because they haven't done the work and, but I don't expect them to do the work and say, "Wow, that seems kind of scammy and weird." Like, didn't the Trump's family launch a meme token? Didn't Hunter Biden launch a meme token? So there's a side of it that I think kind of pollutes the seriousness. If people are making money on that side, great.

Like, I think I, you know, I kind of have libertarian values, do whatever you want. But yeah, I think that it's sometimes very hard to defend. No, in reality, I don't think we're morons. I think if you're... If you truly believe in Bitcoin and you understand this technology, I think that you're just have a window into the future. But, you know, I, I can be a bit tongue in cheek, and I can't remember what spawned up on that, uh, idea or what was going on, but it was something ridiculous. It might've been Hunter Biden. Yeah.

[chuckles] It's all in the digital ether somewhere. Clarity becomes law before the midterms, yes or no? No. I think prediction markets are putting that at like six percent, by the way, to actually become law. So no, I don't. Mm-hmm. Robinhood chain in twelve months, top five chain or a footnote? Top five chain. One coin you would never touch again? God. Do I have to say it? XRP. Sorry, guy. I know, I, but you're all wonderful. Deeply believe in you, but that was the example I was giving you before of raising billions of dollars and then doing something with it down the road after you're already a billionaire.

And then Scott, do you have a Bitcoin price prediction for the next cycle? If we believe in the cycle, uh, yeah, I think it into the two hundreds, two fifty. Mm-hmm. Two twenty to two fifty. By the way, I probably-- that was probably my prediction for like twenty-twenty1 cycle, so don't listen to me. But yeah, I, I, I think much higher than the previous all-time high. Yeah, yeah. What's the worst public call you have made, and what did it cost you? Yeah, the, the, the, the... How much time do you have? Lightning round. Uh, well, in those early days, I was calling all these cryptos to go up 100x, and they all went down 99.9%, so there's a thousand examples of it.

But I would say, honestly, I had very hyperbolic Bitcoin predictions in both of the last two cycles that did not, uh, reach fruition. I was very surprised that 126,000 was the top of that cycle. Didn't even 2x the previous highs, and we always saw at least 3.5, 7, 10x, you know, previous cycle highs. So I thought we were going into the 200s last time, to be honest. Mm-hmm. And then, uh, second last one, The Wolf of All Streets, that's your name on Twitter. Where does that come from? It was a joke that stuck. So somebody, when I was transitioning from music to crypto, which I didn't know I was doing at the time, I was commenting on markets because I was really into it and passionate, and somebody sub-tweeted me or responded and said, "Shut up," or something, "Stay in your lane.

Go back to DJ-ing, you fake Wolf of Wall Street." They called me a fake Wolf of Wall Street, and I responded something like, "Ah, I can be the Wolf of All Streets," like as a joke. Like, no, don't, don't tell me to stay in my lane. You know, people can do more than one thing, which I deeply believe. Like, just 'cause you're in music doesn't mean you can't understand financial markets, or just because you're a baseball player doesn't mean you can't cook. I don't know, right? Uh, and so I made a joke, and it kinda went viral, and then I was in all these trading groups and stuff, and people just started calling me Wolf.

And it stuck, and I je- I, I just changed it as my moniker for a day as a joke. I was Scott Melker before that, and it just kinda made sense. And then I branded my podcast after it, and it stuck forever. Yeah, it's such a cool story. Last one. One book, idea, conversation, or song, or whatever it is that shaped how you see the world today. The Price of Tomorrow by Jeff Booth, and I highly recommend that everybody read that. It'll change your perspective on everything. Great. We'll link it in the show notes. Scott, thanks so much for coming.

Thanks for your time, uh, taking it out in your busy schedule. It was awesome to have you on the show. And then, Scott, do you have a Bitcoin price prediction for the next cycle? If we believe in the cycle, uh, yeah, I think it... into the 200s. 250. Mm-hmm. 220 to 250. By the way, I probably... That was probably my prediction for, like, 2021 cycle, so don't listen to me. [laughs] But yeah, I, I, I think much higher than the previous all-time high. Yeah, yeah. What's the worst public call you have made, and what did it cost you?

Yeah, the, the, the, the... How much time do you have? Lightning round. Uh, well, in those early days, I was calling all these cryptos to go up 100x, and they all went down 99.9%, so there's a thousand examples of it. But I would say, honestly, I had very hyperbolic Bitcoin predictions in both of the last two cycles that did not, uh, reach fruition. I was very surprised that 126,000 was the top of that cycle. Didn't even 2x the previous highs, and we always saw at least 3.5, 7, 10x, you know, previous cycle highs. So I thought we were going into the 200s last time, to be honest.

Great. We'll link it in the show notes. Scott, thanks so much for coming. Thanks for your time, uh, taking it out in your busy schedule. It was awesome to have you on the show. Thank you so much, man. It was great. You obviously like this video enough that you got to the end. Listen, do me a favor. Hit that like and subscribe button, because I think you'll like it. And if you want even more, with more I mean incredible alpha, research, and digital asset market updates, subscribe to our newsletter on 51, that's the number 51, insights.xyz, and get the most actionable insights on digital assets.

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