This Changes EVERYTHING for CRYPTO!!! - Massive regulatory shifts, real payments, and rising security threats.

Speaker:
00:00:01
Welcome to FinTech Confidential, bringing you the people, tech and



Speaker:
00:00:06
companies that change how you.



Speaker:
00:00:11
It is not surprising that they're starting to make that direction towards the us.



Speaker:
00:00:14
No one who was really making large high volume international payments really



Speaker:
00:00:19
thought Bitcoin was a solution to that because of all the price volatility,



Speaker:
00:00:23
most of the financial world has been batch



Speaker:
00:00:25
processed on a daily basis.



Speaker:
00:00:28
Each dollar unit backing every stable coin is represented by US dollar



Speaker:
00:00:32
equivalent held in a US bank or



Speaker:
00:00:34
what are you hearing?



Speaker:
00:00:35
Far as the benefits of why the stables are, are



Speaker:
00:00:38
picking up as a form of payment.



Speaker:
00:00:41
The Web3 and digital asset industry has matured enough that some of the



Speaker:
00:00:44
risks that were there maybe a couple of years ago are not as prominent.



Speaker:
00:00:47
The scrutiny that was there from the federal banking regulators



Speaker:
00:00:50
is not necessarily gonna be as.



Speaker:
00:00:52
Intense as it was.



Speaker:
00:00:53
Do you think it's gonna still be that, that really broad chasm



Speaker:
00:00:57
between hyper restrictive and hyper enablement, the Web3 landscape



Speaker:
00:01:03
seems to be on that tipping point?



Speaker:
00:01:06
The theory of what could be to starting to move towards the execution of what can be.



Speaker:
00:01:13
Bitcoin 2025 lands in Las Vegas at the Venetian, May 27th through the 29th.



Speaker:
00:01:19
And FinTech Confidential is there as an official media partner.



Speaker:
00:01:22
We're on site with full access to over 200 speakers.



Speaker:
00:01:26
Breakthroughs in mining, lightning and scale, real world use cases,



Speaker:
00:01:31
institutional Bitcoin strategy, and you'll hear from folks like Michael Saylor.



Speaker:
00:01:36
Elizabeth Stark, Jack Mahler, and Senator Cynthia Loomis.



Speaker:
00:01:41
There's no fluff, no noise.



Speaker:
00:01:43
This is where Bitcoin and digital assets get real.



Speaker:
00:01:46
Your pass is waiting@fintechconfidential.com slash btc.



Speaker:
00:01:51
So prices are rising and seeds are moving.



Speaker:
00:01:54
So be there at Bitcoin 2025 Las Vegas, Nevada.



Speaker:
00:01:59
Embrace the game theory.



Speaker:
00:02:06
Welcome to Web3 with FTC.



Speaker:
00:02:08
If you're asking how blockchain, crypto ai, even quantum computing fits into your



Speaker:
00:02:13
business strategy, this is built for you.



Speaker:
00:02:16
We talk with the builders and the decision makers who are doing the work.



Speaker:
00:02:20
You'll hear smart conversations, straight insights, and no filling,



Speaker:
00:02:25
whether you're a founder, an executive, or just trying to stay ahead.



Speaker:
00:02:29
This is where Real talk meets real tech.



Speaker:
00:02:32
I'm your host, Tedd Huff and thrilled to welcome our newest



Speaker:
00:02:35
contributor, or as we like to call them, confidential informants,



Speaker:
00:02:40
and his name is Robert Musiala.



Speaker:
00:02:43
Rob is the co-leader of the Web3 and Digital Assets team at Baker Hostetler,



Speaker:
00:02:49
a US law firm that is more than 1000 attorneys recognized for helping clients



Speaker:
00:02:56
address complex business and regulatory issues across digital assets, data



Speaker:
00:03:01
management, and emerging technologies.



Speaker:
00:03:04
Now, Rob brings to us decades of experience in blockchain



Speaker:
00:03:08
law, regulatory compliance, and digital asset investigations.



Speaker:
00:03:13
And he's the lead author of the Blockchain Monitor blog, where he



Speaker:
00:03:17
breaks down the latest trends and legal developments in crypto each week.



Speaker:
00:03:22
Today's format, as you can imagine, is probably gonna be a little bit different.



Speaker:
00:03:26
So we'll be talking about what happened in the month of April, 2025, and I'll



Speaker:
00:03:31
be giving you some of the strategic signals with absolutely no fluff.



Speaker:
00:03:34
And Robert's gonna be nice enough to bring the structure, compliance,



Speaker:
00:03:37
and legal backdrop to all of this.



Speaker:
00:03:39
And today's topics we're gonna be covering payments, capital markets,



Speaker:
00:03:44
regulation, enforcement threats.



Speaker:
00:03:47
Close with strategic outlook.



Speaker:
00:03:49
So let's dive in.



Speaker:
00:03:51
Robert, thank you so much for joining me as one of our first confidential



Speaker:
00:03:56
informants on Web3 with FTC.



Speaker:
00:03:59
Thanks for having me on the podcast, Tedd.



Speaker:
00:04:01
Happy to be here.



Speaker:
00:04:02
So, you know, you and I, we were prepping going through all this stuff,



Speaker:
00:04:06
just trying to pick the good stuff out of, out of the, the blogs you all



Speaker:
00:04:11
do as well as some of the things that are going on in the marketplace and.



Speaker:
00:04:16
I think it's important for people to understand that this has



Speaker:
00:04:20
become a competitive advantage for a lot of fintechs when they



Speaker:
00:04:23
integrate into this technology.



Speaker:
00:04:26
Whether it's stable Coin Crypto as a service.



Speaker:
00:04:30
Uh.



Speaker:
00:04:31
Any other royal loyalty based items really start to, to make a big difference in it.



Speaker:
00:04:37
But of course, it always comes with some fun things like licensing and registration



Speaker:
00:04:43
and cross border things we have to think about, which then of course, brings in



Speaker:
00:04:46
the compliance and the regulatory pieces.



Speaker:
00:04:49
I, I've been saying this for a long time, this is a borrowed quote, but



Speaker:
00:04:52
you, you know, in financial services these days, you're either protecting



Speaker:
00:04:56
the past or building the future.



Speaker:
00:04:58
And I, I think more and more building the future means, uh, figuring out where



Speaker:
00:05:04
blockchain Web3 di and digital assets fit, uh, into your business model.



Speaker:
00:05:10
And so, uh, you know, I, I think it's relevant anytime that we see



Speaker:
00:05:16
traditional financial services company taking steps to integrate



Speaker:
00:05:21
with crypto, a crypto native company.



Speaker:
00:05:24
Then anytime we see the reverse, um, a crypto, a native crypto company



Speaker:
00:05:29
taking steps to integrate with a traditional financial services



Speaker:
00:05:33
company and more, and we're seeing that more and more, uh, you know.



Speaker:
00:05:37
As you mentioned, uh, we publish this blog every week.



Speaker:
00:05:40
We've been doing that for seven years now.



Speaker:
00:05:42
And one trend that I've observed over the years is more and more often we are



Speaker:
00:05:47
reporting on, um, developments where we see this pattern occurring again in



Speaker:
00:05:54
both directions, both tradify uh, taking steps to integrate with crypto and crypto



Speaker:
00:05:59
taking steps to integrate with trap fight.



Speaker:
00:06:02
You know, the recent development you mentioned, uh, I think has a



Speaker:
00:06:05
lot to do with the continued, uh, that continued trend that we're



Speaker:
00:06:09
seeing in the marketplace, uh, and the expansion of that trend.



Speaker:
00:06:12
Really,



Speaker:
00:06:12
I think the piece that makes this one stand out is, you know, Kraken



Speaker:
00:06:18
is using this enabled spending of.



Speaker:
00:06:22
Crypto at about 150 plus million merchants across Europe and the uk.



Speaker:
00:06:29
Um, and not only that, but they're supporting over 300 currencies, whether



Speaker:
00:06:36
it's digital assets or traditional fiats.



Speaker:
00:06:40
They're supporting all of those.



Speaker:
00:06:42
So it, it's not surprising that they're starting to make



Speaker:
00:06:45
that direction towards the us.



Speaker:
00:06:47
Another trend that I've observed over the years.



Speaker:
00:06:49
Is, and, and, and this is something I say often is that, you know, I don't, I,



Speaker:
00:06:54
I've never thought that crypto would ever replace the traditional financial system.



Speaker:
00:06:58
Instead, it's going to become more and more integrated with it.



Speaker:
00:07:01
Uh, in other words, you know, if you think about it, we have a lot of different



Speaker:
00:07:04
methods through which we can pay people.



Speaker:
00:07:06
Today we have a CH, we have wire transfer, we have credit card, we have



Speaker:
00:07:09
debit card, um, and other methods.



Speaker:
00:07:13
And crypto is just becoming one more method to add to that list.



Speaker:
00:07:17
So I think, you know, the development you mentioned is really targeted



Speaker:
00:07:22
at, uh, merchant payments, and that's one, uh, sort of.



Speaker:
00:07:27
Vector that is moving pretty quickly in the, the FinTech space is how do



Speaker:
00:07:32
we make it easier to pay merchants?



Speaker:
00:07:34
Uh, and so, you know, we, I think that problem is something that is being



Speaker:
00:07:38
addressed is, and then similarly, there's a parallel but related problem that has



Speaker:
00:07:44
always been out there, which is for.



Speaker:
00:07:46
Uh, crypto holders for those who prefer to hold their money in crypto, how



Speaker:
00:07:51
do we make it easier for them, uh, to pay for things without having to



Speaker:
00:07:55
exchange their crypto for fiat first?



Speaker:
00:07:59
You know, and I think anytime we see announcements related to, um,



Speaker:
00:08:05
uh, crypto debit cards, uh, or other sort of traditional FinTech



Speaker:
00:08:09
payment mechanisms that allow you to pay at traditional FinTech.



Speaker:
00:08:14
Point of sale systems or, or, uh, online portals, but spend under, but



Speaker:
00:08:19
behind the scenes spending your crypto, you know, we're seeing, uh, a race



Speaker:
00:08:24
to address that need, uh, where, you know, crypto holders wanna spend their



Speaker:
00:08:28
crypto without having to go through the stuff with exchanging first.



Speaker:
00:08:31
And then merchants wanna just be able to accept different types of



Speaker:
00:08:34
payments and reach a larger audience.



Speaker:
00:08:36
Well, and, and the merchants just, they just want their money.



Speaker:
00:08:40
That's really, they just want their money and, and, you know.



Speaker:
00:08:43
We've heard a lot of of things this last April related around stable coin that



Speaker:
00:08:53
seems to be picking up a lot of momentum.



Speaker:
00:08:56
Coinbase and PayPal, they, they've done a little deal together



Speaker:
00:09:01
that offers rewards, uh, for.



Speaker:
00:09:06
For using the, uh, P-I-U-S-D.



Speaker:
00:09:09
They're, they're waiving some fees.



Speaker:
00:09:11
There's a whole bunch of fun stuff that's going on around that.



Speaker:
00:09:14
And I know we didn't talk about this, but I had to bring it up because it



Speaker:
00:09:17
came up on the last day of the month.



Speaker:
00:09:20
I thought it was very interesting also.



Speaker:
00:09:23
That Ripple decided to place an a bid on, on circle the last day of the month.



Speaker:
00:09:30
But you know, that to me just shows how frothy the waters are getting around



Speaker:
00:09:36
stablecoin and how important they're gonna be to be moving forward with those things.



Speaker:
00:09:43
Rob, what?



Speaker:
00:09:43
What are you.



Speaker:
00:09:45
That, is that just something that's going on now or is there something



Speaker:
00:09:48
deeper that you're seeing as well?



Speaker:
00:09:51
A little bit more to it and, uh, you know, for, for those who are working



Speaker:
00:09:55
in this space on a day-to-day basis, like me, I, I think this is more common



Speaker:
00:09:59
knowledge, some of this stuff, but for, um, you know, those who are working in



Speaker:
00:10:03
FinTech but not necessarily crypto or who are not living and breathing this



Speaker:
00:10:08
industry every day, um, some of this stuff hasn't really come to the mainstream,



Speaker:
00:10:12
so I'm glad that we're talking about it.



Speaker:
00:10:14
Um, but you know, really behind the scenes driving a lot of this is,



Speaker:
00:10:18
um, the pending legislation that's being discussed and circulated in



Speaker:
00:10:22
Congress, uh, that is broadly referred to as the Payment Stablecoin Act.



Speaker:
00:10:27
And that would be a law that would, uh, create a, a very



Speaker:
00:10:31
sophisticated, uh, and detailed regulatory framework for stablecoin



Speaker:
00:10:35
issuers here in the United States.



Speaker:
00:10:38
Um, that would, um, include.



Speaker:
00:10:41
Various very smart, uh, protections, things that a lot



Speaker:
00:10:45
of the US stablecoin issuers have been doing for a long time now.



Speaker:
00:10:47
But things like ensuring that, um, each dollar unit, backing every stablecoin,



Speaker:
00:10:53
uh, is represented by US dollar equivalent held in a US bank or, or qualified



Speaker:
00:10:58
custodian, and that those accounts are audited, uh, on a monthly basis with auto,



Speaker:
00:11:04
you know, audited by US public accounting firms, things that make, uh, sort of



Speaker:
00:11:08
the consumer a lot more comfortable.



Speaker:
00:11:11
Using stable coins and all that.



Speaker:
00:11:13
Uh, it has really underpinned what some people are calling



Speaker:
00:11:17
the stable coin wars right now.



Speaker:
00:11:19
Uh, because you've got this in the background, pending legislation.



Speaker:
00:11:24
A a lot of people keep saying we will get a law, um, passed very likely in 2025.



Speaker:
00:11:31
Um, it could be sooner, could be later, but um, by all counts,



Speaker:
00:11:35
many people say that they expect that for that to happen this year.



Speaker:
00:11:39
And so we're seeing companies preparing for that, you know, so we're seeing



Speaker:
00:11:44
the current, uh, stable coin issuers that have already been in the market



Speaker:
00:11:47
for a while are, um, starting to get a little bit more competitive.



Speaker:
00:11:51
Um, also starting to, in some instances, um, cooperate a little bit more to sort



Speaker:
00:11:57
of support each other in the market.



Speaker:
00:11:59
Uh, and then we see new players getting ready to enter the market.



Speaker:
00:12:03
And I think we'll talk a little bit more about that with.



Speaker:
00:12:05
Things like, um, the state of Wyoming or, um, a, a Wyoming based



Speaker:
00:12:10
bank that has recently, um, tested and issued a stable, uh, you know,



Speaker:
00:12:14
a stable coin for themselves.



Speaker:
00:12:16
I'm



Speaker:
00:12:16
bringing us back to the, the payments piece of it.



Speaker:
00:12:19
What, what are you seeing or what are you hearing as far as the



Speaker:
00:12:26
benefits of why the stables are, are picking up as a form of payment?



Speaker:
00:12:30
You know, there, there's a. There's many different kinds of



Speaker:
00:12:33
stables, and we're not gonna get into the differences between them.



Speaker:
00:12:37
But, you know, the, the stable coin is, is almost a equivalent to a digital dollar.



Speaker:
00:12:44
But why, why do you feel, or, or what are you seeing that has



Speaker:
00:12:50
garnered the attention of it so much?



Speaker:
00:12:54
So outside of regulatory, outside of those things, what, what



Speaker:
00:12:58
are some of the things that.



Speaker:
00:13:00
Are making it appealing to, to the powers that be, let's say?



Speaker:
00:13:05
Sure.



Speaker:
00:13:05
Well, I mean, as you know, um, and anyone who has, uh, observed or worked in the



Speaker:
00:13:10
FinTech industry has known, um, payments are clunky historically, had have been



Speaker:
00:13:17
relatively clunky, uh, for a long time.



Speaker:
00:13:20
And, you know, the technology has evolved over time.



Speaker:
00:13:24
Um, we still have instances where, you know, international wires have



Speaker:
00:13:29
trouble clearing on time, where, um, you know, companies feel like they're



Speaker:
00:13:34
paying way too much, uh, for payments.



Speaker:
00:13:37
Are there too many intermediaries involved in processing payments and,



Speaker:
00:13:41
um, stable coins Being powered by blockchain really do solve a lot of those



Speaker:
00:13:48
problems, you know, fundamentally, um.



Speaker:
00:13:52
Blockchain in, in many respects is about removing intermediaries.



Speaker:
00:13:56
And so when we talk about payments, that means removing all the corresponding



Speaker:
00:14:00
banks, uh, that are underlying and sit behind any, any, any payment transaction,



Speaker:
00:14:07
any electronic payment transaction, uh, especially international, and streamlining



Speaker:
00:14:13
that so that you're having this, those payments, uh, cleared by a blockchain.



Speaker:
00:14:16
Now, of course.



Speaker:
00:14:17
When it was just, when we were just talking about Bitcoin before the, the,



Speaker:
00:14:21
um, idea of stable coins came along, you know, no one was really, none of,



Speaker:
00:14:26
no one who was really making, um, large high volume international payments.



Speaker:
00:14:32
Uh, really thought Bitcoin itself was a solution to that because



Speaker:
00:14:36
of all the price volatility.



Speaker:
00:14:38
Uh, and then you enter, enter stable coins that attempt to



Speaker:
00:14:42
solve that problem by saying, Hey.



Speaker:
00:14:43
We're creating a, a digital asset that functions just like Bitcoin in terms of



Speaker:
00:14:48
its transferability, uh, and its, um, accessibility on a blockchain network.



Speaker:
00:14:54
Uh, and each unit is gonna be backed by a real dollar and a real bank account



Speaker:
00:14:58
audited by a US public accounting firm.



Speaker:
00:15:01
Now, um, that, that to me, uh, that type of stable coin, a fiat



Speaker:
00:15:06
backed stable coin, so to speak.



Speaker:
00:15:09
Is, um, in my view, one of them, uh, the innovations in this industry that



Speaker:
00:15:13
really excites me the most because it solves a lot of these fundamental



Speaker:
00:15:17
problems and payments that you and I and others that have been working



Speaker:
00:15:20
in FinTech have been dealing with, you know, for our entire careers.



Speaker:
00:15:25
Um, by making them faster, um, near instant, you know, there's still



Speaker:
00:15:30
some issues with, uh, some of the networks, but really a lot faster



Speaker:
00:15:34
in most cases than existing methods.



Speaker:
00:15:38
Then, especially from an international standpoint, uh, a lot less expensive.



Speaker:
00:15:43
Uh, and then fully transparent on a blockchain network so that everyone



Speaker:
00:15:46
knows, you know, when I'm paying you, you know that you received it



Speaker:
00:15:50
and I know when you received it.



Speaker:
00:15:52
And, uh, we're both looking at the same record of that transaction.



Speaker:
00:15:56
Uh, so those are some of the things, some of the things that I think



Speaker:
00:15:58
excite, uh, FinTech professionals and, and businesses working in



Speaker:
00:16:02
the payment space or businesses.



Speaker:
00:16:05
Looking to accept payments about stable coins.



Speaker:
00:16:07
And then we can also talk about some of the advantages, uh, for



Speaker:
00:16:10
actually just the merchants.



Speaker:
00:16:11
Um, but I'll, I'll pause there.



Speaker:
00:16:13
You're building a FinTech product.



Speaker:
00:16:15
You want to offer digital assets, but wallets, that's the hard part.



Speaker:
00:16:20
Security, compliance, key orchestration, blockchain integration.



Speaker:
00:16:26
That's why fintech's, payment platforms and custodians.



Speaker:
00:16:29
Choose defense.



Speaker:
00:16:30
They provide wallets as a service.



Speaker:
00:16:33
That's API first, multi chain by design and secured within NPC.



Speaker:
00:16:37
No single point of failure.



Speaker:
00:16:38
So you can launch across over 50 Blockchains, automate policy



Speaker:
00:16:41
controls and stay audit ready without managing private keys.



Speaker:
00:16:45
Stripes, bridge powers, crypto payments through Defense Moon, PAYE Scales.



Speaker:
00:16:49
Wallet securely with defense sphere.



Speaker:
00:16:52
Grew without compromising on control or compliance.



Speaker:
00:16:57
Even major fis like Fidelity, AB and Amro, as well as custodians like



Speaker:
00:17:02
Zoia and Tungsten trust defense to power their on chain infrastructure,



Speaker:
00:17:07
developer ready, compliance approved production grade from day one.



Speaker:
00:17:12
If you're building in payments.



Speaker:
00:17:14
Exchanges, OTC desks, market makers, or defi defense wallets.



Speaker:
00:17:20
Work the way you need them to request your demo at fintechconfidential.com/dfns



Speaker:
00:17:28
defense Secure wallets built around.



Speaker:
00:17:33
One of the things you left out that is something that gets me most



Speaker:
00:17:36
excited is really the ability to.



Speaker:
00:17:39
Programmatically have things happen based upon, uh, a trigger or based



Speaker:
00:17:47
upon a rule, or based upon some action happening or a time period,



Speaker:
00:17:51
like all these different things.



Speaker:
00:17:53
So instead of having to have a person there or waiting for the next cycle to



Speaker:
00:17:59
happen is, is most of the financial world has been batch processed on a daily basis.



Speaker:
00:18:05
A lot of that starts to go away.



Speaker:
00:18:07
And I think that is, that is really interesting, um, that



Speaker:
00:18:11
we've been able to, to do that.



Speaker:
00:18:13
I agree.



Speaker:
00:18:14
And I think that will be the next phase that we see, you know, once uh,



Speaker:
00:18:18
we get a stable coin, uh, act passed into law and businesses become more



Speaker:
00:18:23
comfortable with stable coins, I think the very, one of the next phases is



Speaker:
00:18:27
going to be a lot of experiments with, you know, what you mentioned, what



Speaker:
00:18:31
folks call program programmable money.



Speaker:
00:18:34
Where, um, you know, payments are made instantaneously upon the



Speaker:
00:18:38
occurrence of predefined events.



Speaker:
00:18:40
Uh, and that theoretically you could unlock a lot of liquidity



Speaker:
00:18:44
in the financial system.



Speaker:
00:18:45
So as we talk about stable coins, you know, it brings us back, and you even



Speaker:
00:18:49
mentioned it, you know, we really didn't look at Bitcoin is a, well, and



Speaker:
00:18:53
I shouldn't say we, but Bitcoin has not been very frequently looked at.



Speaker:
00:18:58
As a means to make a payment.



Speaker:
00:19:01
It's looked at more of an asset and, and we can go into all that fun



Speaker:
00:19:05
stuff, but it hasn't been a really good means to do a, a transaction.



Speaker:
00:19:11
And I think this is why, you know, the stable coins give you that nice bridge



Speaker:
00:19:16
between the crypto native and, and the traditional finance side of the house.



Speaker:
00:19:22
But I, I would be remiss to state that in April.



Speaker:
00:19:27
Bitcoin finally made it back up in the 95, 90 $6,000 area.



Speaker:
00:19:34
What are some of the other things that, that you're looking at, that



Speaker:
00:19:39
you're seeing, especially when we start thinking capital markets type stuff?



Speaker:
00:19:44
Um, and we can, we can start with the Bitcoin and then move from there.



Speaker:
00:19:48
Crypto and digital assets, uh, certainly over the last



Speaker:
00:19:52
month and also just over time.



Speaker:
00:19:55
Appear to have to be becoming more and more intertwined with traditional finance.



Speaker:
00:20:01
And so we're seeing that same thing theme play out in, in



Speaker:
00:20:05
the cap in capital markets.



Speaker:
00:20:06
Now, I, I always say I'm not an expert on the Bitcoin price,



Speaker:
00:20:09
so I'm not gonna opine on that.



Speaker:
00:20:10
But what I will say is that, you know, more on a lot of occasions it seems



Speaker:
00:20:16
to be tracking, um, what's happening in, uh, the US equities markets.



Speaker:
00:20:23
And so that itself, you know, is a potential sign that the crypto markets



Speaker:
00:20:29
and the traditional capital markets are becoming more and more intertwined.



Speaker:
00:20:34
Uh, and to your point, um, you know, some examples of that have been some of the



Speaker:
00:20:38
traditional players launching crypto based ETFs, and that's absolutely been a theme



Speaker:
00:20:43
in April and over the past several months.



Speaker:
00:20:46
Well, yeah.



Speaker:
00:20:46
And, and so even in, in April, I know, I know we're talking a lot about Kraken,



Speaker:
00:20:50
but they did a lot this month, right?



Speaker:
00:20:52
So they decided to launch into the traditional markets.



Speaker:
00:20:56
They're offering over a LA 11,000 plus US listed stocks, ETFs, FX futures.



Speaker:
00:21:05
I mean, it just, it just keeps going and going with that one.



Speaker:
00:21:09
But us isn't the only place that things are changing, right.



Speaker:
00:21:12
So, um, in Hong Kong and Canada, they both, uh, approved some



Speaker:
00:21:19
ETFs, um, Ethereum and Solana.



Speaker:
00:21:24
But the part that I thought that was really interesting is that we started to



Speaker:
00:21:28
see the, the staking and, and the lending of digital assets starting to roar back.



Speaker:
00:21:37
And so I. What do you think is, is really driving that desire to on,



Speaker:
00:21:44
on those return side of the house?



Speaker:
00:21:45
Does it have anything to do with the stablecoin stuff that we talked about?



Speaker:
00:21:49
I, I think it's mostly separate in my view.



Speaker:
00:21:52
I, I, I think that, um, you, the similarity again is the continued.



Speaker:
00:22:00
Inter meshing of the traditional and Web3 markets.



Speaker:
00:22:05
Um, I think the staking point that you raise is to me the



Speaker:
00:22:09
mo the most interesting.



Speaker:
00:22:12
Uh, and that's, um, a relatively new development.



Speaker:
00:22:15
And you know, as you mentioned, we saw, um, some developments in Hong Kong



Speaker:
00:22:20
where there was some regulation passed.



Speaker:
00:22:23
Uh, to provide the market with some clear rules as to how to do this in a



Speaker:
00:22:27
way that was going to be, um, met with approval by the financial regulators.



Speaker:
00:22:32
If your provider doesn't allow you to manage all your assets in one



Speaker:
00:22:36
place, we're already starting to see that, that people are behind.



Speaker:
00:22:40
So that's gonna be a big piece of it.



Speaker:
00:22:42
And of course, you gotta have the trust and, and.



Speaker:
00:22:46
We're gonna move into the next segment, which is the regulatory side of the house.



Speaker:
00:22:50
And of course, if you don't, if you have all that stuff in one place, that



Speaker:
00:22:53
means you have to make sure you've got all your ducks in a row and are being re



Speaker:
00:22:57
in the regulatory sites in a good way.



Speaker:
00:23:01
I, I think I. It's been really good, and I'm gonna come back to the US again.



Speaker:
00:23:06
Uh, we're just, we'll just land back in the us Heck, let's go to DC and, and



Speaker:
00:23:10
talk, you know, uh, all of the, the, the acronym agencies have, have really



Speaker:
00:23:18
decided to, to roll back or to simplify or to make, make it a little bit easier



Speaker:
00:23:26
for these digital assets to move forward.



Speaker:
00:23:29
I, I really like the directions it's gonna go.



Speaker:
00:23:32
At least my perspective.



Speaker:
00:23:33
I'm liking it.



Speaker:
00:23:35
But, you know, you started to talk about it earlier and I'd love to go a



Speaker:
00:23:38
little bit deeper into, uh, the SEC's guidance on stable coins and, you know,



Speaker:
00:23:45
it being us backed one-to-one redeemable.



Speaker:
00:23:49
Requiring liquid reserves, not securities, like, help us



Speaker:
00:23:53
uncover that a little bit more



Speaker:
00:23:55
in April.



Speaker:
00:23:55
Um, the SEC published its own, uh, set of guidance.



Speaker:
00:24:02
Uh, and this is from the SEC's division of Trading Markets, I believe, uh, addressing



Speaker:
00:24:07
what they call covered stable coins,



Speaker:
00:24:09
it makes me start to to wonder, are they already expecting to provide returns on.



Speaker:
00:24:18
On stables, like, like are they, it's not like they're preparing for that



Speaker:
00:24:23
type of a, a position to be placed in?



Speaker:
00:24:28
Well, that, that's an interesting comment.



Speaker:
00:24:29
I hadn't thought about it that way.



Speaker:
00:24:31
Um, you know, from my perspective, um, you know, and just to give a



Speaker:
00:24:36
little bit more context, a covered stablecoin, according to the guidance,



Speaker:
00:24:40
if it meets that definition, generally would not be considered a security.



Speaker:
00:24:43
And that's the whole point of the guidance is to give.



Speaker:
00:24:46
Market some confidence that if you're doing stable coins the right way,



Speaker:
00:24:51
you're, you're not going to get an enforcement action or a subpoena by the



Speaker:
00:24:56
SEC. Um, and, you know, we talked about the payment Stable Coin Act before.



Speaker:
00:25:02
I think another, um, smart thing that has been done by the SEC here is that



Speaker:
00:25:08
they're getting ahead of the, the payment stablecoin Act a little bit and giving



Speaker:
00:25:11
the market a little bit more comfort.



Speaker:
00:25:12
Wow.



Speaker:
00:25:13
Some of the similar definitions are worked out in what will eventually become a



Speaker:
00:25:17
law, um, and maybe giving, you know, in some respects, giving the legislators.



Speaker:
00:25:23
Um, you know, some advice as to what that definition, you know,



Speaker:
00:25:27
might look like in the law.



Speaker:
00:25:29
Um,



Speaker:
00:25:29
just, just kind of giving a little bit of guidance, you know,



Speaker:
00:25:32
trying to shepherd it along.



Speaker:
00:25:33
I mean, that there's, there, there could be worse things that go on with that.



Speaker:
00:25:38
Uh, but the other thing that also happened, again, just keeping in



Speaker:
00:25:41
alignment with some of our, uh, our federal, federal agencies.



Speaker:
00:25:46
I mean, federal Reserve, uh.



Speaker:
00:25:50
Rolled back their restrictive guidance and really got it



Speaker:
00:25:53
really aligned with OCC and FDIC.



Speaker:
00:25:56
And, and you know, this, this month I've had a, had the opportunity to,



Speaker:
00:26:00
to participate, um, at, at the NACHA conference in, in New Orleans, Louisiana.



Speaker:
00:26:06
And this seemed to be a really big thing that they were talking about.



Speaker:
00:26:10
There is the, the guidance that has been adjusted by the OCC and the



Speaker:
00:26:16
FDIC around these types of things.



Speaker:
00:26:18
Really seems to be opening up a number of opportunities and making



Speaker:
00:26:22
these financial institutions feel a little bit more comfortable



Speaker:
00:26:26
with bringing on digital assets.



Speaker:
00:26:29
Now, again, I said a little bit more comfortable.



Speaker:
00:26:32
Not a lot.



Speaker:
00:26:33
It's not like they're gonna open the floodgates, but they're,



Speaker:
00:26:35
they're feeling that way.



Speaker:
00:26:37
Uh, what, what other things are you seeing with all of these rollbacks



Speaker:
00:26:40
and, and the perspectives that, that others are having from this?



Speaker:
00:26:45
Well, I, I think the develop the development you mentioned where we



Speaker:
00:26:48
now, as of the month of April, have all of the major US banking, right?



Speaker:
00:26:53
Federal regulators, essentially, um, in alignment in saying that, um, the, the



Speaker:
00:27:00
former process of a bank, uh, needing.



Speaker:
00:27:04
Notice or a letter of non objection, in other words, permission, um, to



Speaker:
00:27:08
engage in crypto related activities.



Speaker:
00:27:10
That guidance is gone and banks can now engage in crypto related



Speaker:
00:27:14
activities at their own discretion.



Speaker:
00:27:16
Mm-hmm.



Speaker:
00:27:17
But also subject to the normal supervisory review process.



Speaker:
00:27:20
So a bank will get reviewed and they'll get reviewed for a lot of different things



Speaker:
00:27:24
and crypto will be one of those things.



Speaker:
00:27:25
You know, and I think, um, part of the, um, press releases that announced



Speaker:
00:27:31
these developments noted that.



Speaker:
00:27:33
Um, the Web3 and digital asset industry has matured enough that some of the



Speaker:
00:27:39
risks that were there maybe a couple years ago, um, are not as prominent.



Speaker:
00:27:43
And so, you know, these risks can be addressed in the



Speaker:
00:27:45
normal supervisory process.



Speaker:
00:27:46
Now,



Speaker:
00:27:47
if the.



Speaker:
00:27:49
Systems and the market itself has matured a lot, though I believe that the



Speaker:
00:27:54
understanding from those who regulate it probably has matured more so than, than



Speaker:
00:28:00
the actual products and and technologies.



Speaker:
00:28:04
So that, that one, I, I see where you're headed with that.



Speaker:
00:28:07
Um, but you know, the thing I wanna talk about next is really, you



Speaker:
00:28:13
know, we look at this, we're talking about federal regulators, right?



Speaker:
00:28:16
And federal regulation.



Speaker:
00:28:18
But in the US the states can do all sorts of fun stuff, um, all by themselves.



Speaker:
00:28:24
And you know, the one that that makes, that has come to light,



Speaker:
00:28:28
especially this month, was Wyoming.



Speaker:
00:28:32
Um, they've decided, uh, to, to launch the YST.



Speaker:
00:28:38
It's in testing, they're running with that.



Speaker:
00:28:41
And then on top of that, you've got Custodial and Vantage that launched



Speaker:
00:28:46
their first bank stable coin.



Speaker:
00:28:49
I mean, there's just, there's so much stuff that's going on



Speaker:
00:28:51
at the state level right now.



Speaker:
00:28:53
Um, I, I, I'm starting to feel, and you and I kind of talked about this



Speaker:
00:28:58
as we were prepping over the last few weeks, because I'm starting to feel



Speaker:
00:29:01
like, I wonder if we're gonna start looking at digital assets the same way



Speaker:
00:29:07
we look at money transmitter licenses.



Speaker:
00:29:11
How it, it's, it's a state by state variation.



Speaker:
00:29:14
Uh, what, what are your.



Speaker:
00:29:17
Perspectives and what are, what are the things that I left out



Speaker:
00:29:20
that's going on at the state level?



Speaker:
00:29:22
Sure.



Speaker:
00:29:22
Well, I, I think first, you know, at, I think the states now are gonna



Speaker:
00:29:27
become a lot more comfortable, um, taking actions that maybe, uh, they



Speaker:
00:29:31
wouldn't necessarily have taken in, in the absence of, um, the recent



Speaker:
00:29:37
guidance from the federal regulators.



Speaker:
00:29:38
So companies and then even state-based agencies now have a



Speaker:
00:29:42
little bit more comfort, um, that.



Speaker:
00:29:46
The, um, the scrutiny that was there from the federal banking regulators



Speaker:
00:29:51
is not necessarily gonna be, um, as intense as it was a couple years ago.



Speaker:
00:29:56
That opens up, you know, gives confidence to state-based agencies as well as banks



Speaker:
00:30:02
within states that are operating our state charters, um, to take some actions that



Speaker:
00:30:07
maybe they were kicking around from, like an rn, you know, research and development



Speaker:
00:30:11
and new product perspective that.



Speaker:
00:30:13
They were afraid to launch a couple years ago and now, you know, I think



Speaker:
00:30:16
some of that fear has been lifted.



Speaker:
00:30:17
Um, and so I think in large part that has triggered some of these



Speaker:
00:30:21
developments, uh, like the ones you mentioned in the state of Wyoming.



Speaker:
00:30:25
Um, so when I look at



Speaker:
00:30:27
Wyoming is, has been very, um, digital asset forward for a really long time.



Speaker:
00:30:37
And then you look at a state like New York that has been



Speaker:
00:30:40
very, very super restrictive.



Speaker:
00:30:43
And the other state that I'm still trying to figure out why the, where



Speaker:
00:30:48
they're going and what they're doing with, with digital assets is Illinois.



Speaker:
00:30:53
But what, where do you, do you think it's gonna still be that,



Speaker:
00:30:57
that really broad chasm between like hyper restrictive and hyper uh.



Speaker:
00:31:05
Enablement, like, are, is that, is that something you're seeing?



Speaker:
00:31:08
And as you look through all of this stuff,



Speaker:
00:31:11
I, I think we're gonna see a, a, a real mix across the board.



Speaker:
00:31:14
I, you know, I think we're gonna see, um, you know, on one end, like the state



Speaker:
00:31:20
of New York, very restrictive licensing regime on another end, like the state



Speaker:
00:31:25
of Wyoming, uh, very open to innovation.



Speaker:
00:31:28
We couldn't picked any two further opposites.



Speaker:
00:31:31
And, and we'll see everything in between.



Speaker:
00:31:34
We'll see.



Speaker:
00:31:34
We're gonna see everything in between.



Speaker:
00:31:36
Um, and I think over time it may be, it may be that some of the states that,



Speaker:
00:31:41
um, are slower to act may sort of, uh, observe what the results are in, you



Speaker:
00:31:47
know, the more restrictive categories, less restrictive categories, and



Speaker:
00:31:50
then sort of follow suit, you know.



Speaker:
00:31:53
Um, and so just as a couple more recent examples, um, you



Speaker:
00:31:58
know, some states have been.



Speaker:
00:32:01
Discussing their own state-based strategic Bitcoin reserves.



Speaker:
00:32:06
You know, um, Arizona apparently is, is pretty far along in that process.



Speaker:
00:32:10
Yeah.



Speaker:
00:32:10
From what I understand.



Speaker:
00:32:11
But it's been really interesting to see how, how those types of things.



Speaker:
00:32:16
I think Texas is another one that has it on the books as well.



Speaker:
00:32:21
Um, I think we're gonna see a lot more, more folks do that.



Speaker:
00:32:24
And,



Speaker:
00:32:25
you know, this market is growing.



Speaker:
00:32:27
It's very big.



Speaker:
00:32:28
It's not just a one size fit all market.



Speaker:
00:32:30
So, uh, you know, as some more examples, you know, strategic Bitcoin reserve could



Speaker:
00:32:34
be one area where state focuses on another could be stable coins like Wyoming.



Speaker:
00:32:37
Another could be licensing for exchanges, think New York.



Speaker:
00:32:41
Oh yeah.



Speaker:
00:32:42
Um, another area could be the mining sector.



Speaker:
00:32:44
And Texas has been very receptive to the, the mining sector.



Speaker:
00:32:48
Uh, and there are, you know, I'm sure we could come up with many more, and



Speaker:
00:32:51
I think different states, maybe even based on their own sort of economies.



Speaker:
00:32:56
May pick and choose which areas in this market that they want to



Speaker:
00:32:59
regulate more heavily versus, um, take more of a light touch approach.



Speaker:
00:33:03
A lot of these states, and a lot of the players in this space aren't



Speaker:
00:33:08
waiting for an act of Congress, right?



Speaker:
00:33:10
They're, they're looking at the frameworks that are already there



Speaker:
00:33:14
that have already been working.



Speaker:
00:33:16
They're taking guidance from the enforcements that have



Speaker:
00:33:18
happened over the years and.



Speaker:
00:33:21
Really allowing people to, to find their way, whether they're, they're



Speaker:
00:33:26
navigating just based on the regulatory tone shifts, uh, the enforcements kind



Speaker:
00:33:33
of managing through that because it.



Speaker:
00:33:35
It doesn't mean that it's less responsibility when you have,



Speaker:
00:33:39
uh, everybody on the same page.



Speaker:
00:33:41
It just means that everybody is starting to look at it from the perspective of,



Speaker:
00:33:46
okay, so we know it's going to be here.



Speaker:
00:33:48
We know that we're gonna have to protect consumers and businesses and, and keep,



Speaker:
00:33:53
make sure that our economy keeps moving.



Speaker:
00:33:56
Um, and I, I think a lot of them are, are really starting to.



Speaker:
00:33:59
To, to see it from that perspective.



Speaker:
00:34:02
But,



Speaker:
00:34:02
but coming back to kind of your original point about Wyoming, you know, the concept



Speaker:
00:34:06
of a state getting ready to launch its own stable coin, that's groundbreaking.



Speaker:
00:34:11
You know, that that is really something that is, we haven't seen anything



Speaker:
00:34:16
like this before, you know, and that's, that's, that's fascinating.



Speaker:
00:34:19
And then also hosting, being the home state for what will



Speaker:
00:34:22
very likely be the first.



Speaker:
00:34:24
Bank, you know, chartered bank to issue a stable coin.



Speaker:
00:34:27
And I, I am, uh, pretty sure we're gonna see many more chartered banks issue their



Speaker:
00:34:31
own stable coins in the coming years.



Speaker:
00:34:34
You know, it's funny and I appreciate you bringing us back to that because



Speaker:
00:34:37
I've, I've been watching custodian and I've been watching Wyoming for so long,



Speaker:
00:34:43
and as probably many in the, in the industry have been that that big change



Speaker:
00:34:50
sometimes just is kind of like the.



Speaker:
00:34:53
The obvious next step, right?



Speaker:
00:34:55
So it doesn't feel as climactic as when you step back and you look at where it



Speaker:
00:35:01
started and where it's at today, that that really sets the, the stage and really



Speaker:
00:35:08
gives us a good perspective to look from.



Speaker:
00:35:11
I don't like to talk about all the negative stuff, but



Speaker:
00:35:14
I've got to bring it up.



Speaker:
00:35:15
And of course, because we have you from Baker here, um, I, I, I, I do



Speaker:
00:35:19
gotta, I, I do have to talk about the.



Speaker:
00:35:23
The legal regulatory enforcement whirlwind that we've had.



Speaker:
00:35:29
But I thought it was really interesting that in April alone, um, SEC either



Speaker:
00:35:35
dropped or settled with Ripple and Coinbase and Kraken and Immutable



Speaker:
00:35:40
and Yugo Labs and Gemini, and Consensus and Robinhood and open seat.



Speaker:
00:35:44
Uh, I could probably go on for another five minutes of listing all of the



Speaker:
00:35:49
enforcements that were in flight.



Speaker:
00:35:52
Have just been resolved.



Speaker:
00:35:57
I've got to imagine that you're seeing and you're hearing a



Speaker:
00:36:03
huge, huge sigh of relief.



Speaker:
00:36:07
What, what is your perspective on this enforcement environment now?



Speaker:
00:36:14
Well, you know, look, being a, um, a payments professional and FinTech.



Speaker:
00:36:20
Web3 attorney for, you know, over 12 years now and working my entire career



Speaker:
00:36:26
in compliance and investigations.



Speaker:
00:36:28
I think what I could say big picture is that, you know, the regulations



Speaker:
00:36:33
are always changing, so, you know, you've gotta be nimble, especially



Speaker:
00:36:38
in FinTech and Web3 because they're changing, they always change rapidly.



Speaker:
00:36:41
And, um, you've gotta keep up on those changes so that you can understand the



Speaker:
00:36:45
current environment plan for the future.



Speaker:
00:36:48
And we're seeing, we, we have seen a real sea change, uh, no doubt about it.



Speaker:
00:36:52
I think that is, at this point, you know, based on all, a lot of those, um,



Speaker:
00:36:57
actions you just mentioned, it's, it is 110% clear to everyone that there



Speaker:
00:37:02
has absolutely been a sea change, um, in the enforcement environment.



Speaker:
00:37:07
And that obviously opens up a lot of opportunities and, uh, you know, allows



Speaker:
00:37:12
businesses to pivot from, you know, sort of, uh, what may have been a more



Speaker:
00:37:16
defensive stance, uh, to more of an offensive stance, you know, to, to



Speaker:
00:37:21
try to capture or be more aggressive, try to capture some of those market



Speaker:
00:37:23
opportunities, uh, that maybe they were discussing in years past, but



Speaker:
00:37:28
were, um, you know, a little bit, bit too, uh, Tim had just pull the



Speaker:
00:37:32
trigger on for, for very good reasons.



Speaker:
00:37:35
Um, and so I think that, you know, that change in the marketplace



Speaker:
00:37:40
has at this point become.



Speaker:
00:37:43
Absolutely 110% clear to everybody.



Speaker:
00:37:45
There's no doubt that there has been that pivot.



Speaker:
00:37:47
And I think that is, you know, one of the things we can absolutely say



Speaker:
00:37:50
coming out of the month of April, uh, with all of the actions you mentioned,



Speaker:
00:37:54
um, be being dropped, uh, over the course of really March and April, I.



Speaker:
00:37:58
Support provided by Sky Flow.



Speaker:
00:38:01
What if you could build fast but not break privacy?



Speaker:
00:38:03
What if you could ensure data privacy, governance, and compliance



Speaker:
00:38:06
with just a few API calls?



Speaker:
00:38:08
What if you could worry less about PCI requirements while actually



Speaker:
00:38:12
improving privacy and security?



Speaker:
00:38:13
How much more time would your team have to truly innovate?



Speaker:
00:38:16
How much faster could you build and ship new features?



Speaker:
00:38:19
How much more powerful could your app be?



Speaker:
00:38:21
Sky Flow is a zero.



Speaker:
00:38:23
Trust data privacy vault delivered as an API.



Speaker:
00:38:25
Sky flow's radically Simple design.



Speaker:
00:38:28
Choose to collect, secure, and tokenize personal information like



Speaker:
00:38:31
card data and payment details.



Speaker:
00:38:33
And with built-in features like encrypted data analysis and sharing



Speaker:
00:38:36
anonymization and advanced governance, your days of choosing between data



Speaker:
00:38:41
security and data usability are over.



Speaker:
00:38:43
Whether you're just concerned with PCI compliance.



Speaker:
00:38:46
Or need to go further to include CCPA, GDPR, SOC two and beyond.



Speaker:
00:38:51
Sky Flow has you covered.



Speaker:
00:38:52
What if you could build fast but not break privacy with Sky Flow, you can visit



https:
00:38:56
//skyflowsecure.com today to learn how, so that, that makes a lot of sense.



https:
00:39:02
And you know, New York has always been very, uh, regulatory



https:
00:39:06
or, or enforcement heavy.



https:
00:39:08
I mean, just this April.



https:
00:39:11
Um, they find block, uh, $40 million for some a ML violations.



https:
00:39:19
I don't know that's quite a bit.



https:
00:39:21
But if you look at the total assets that block has in digital



https:
00:39:24
assets, it's not really that



https:
00:39:28
much.



https:
00:39:28
You know, part of the message with that action is that the



https:
00:39:31
state of New York, as we would've expected, is going to continue.



https:
00:39:35
To police this industry and is going to continue to find companies that it



https:
00:39:39
thinks, uh, are violating its New York Bit license regime and is gonna continue



https:
00:39:44
to take, uh, in particular anti-money laundering violations very seriously



https:
00:39:49
In the early days and even some conversations today, you



https:
00:39:53
still have people saying that cryptocurrency is, is for criminals,



https:
00:39:58
cryptocurrency is for the scammers.



https:
00:40:01
Um, I think we're, we're.



https:
00:40:02
We've moved past that, but this is just another area where the, the providers



https:
00:40:08
and the technology and the fintechs in the middle can, can get a little



https:
00:40:12
bit over their skis and, and maybe not meet the criteria that is there



https:
00:40:17
and perpetuate a little bit of that.



https:
00:40:18
Hopefully it doesn't keep going, but you have the hacks and you



https:
00:40:23
have the social engineering.



https:
00:40:24
You have all these other different things that, that the losses and the fraud



https:
00:40:30
and the scams that go along with it.



https:
00:40:32
Are are crazy.



https:
00:40:34
Um, but one of the things that you wrote about in the blog



https:
00:40:39
is that crypto theft totals.



https:
00:40:43
Um, right about 1.63 billion ish.



https:
00:40:49
I'm using a ish area.



https:
00:40:51
Um, I thought that was really interesting because if you look at it, that's



https:
00:40:55
about 1% of the total market cap.



https:
00:41:01
For Bitcoin itself.



https:
00:41:03
So that's a lot, a lot of value that's been stolen.



https:
00:41:11
Yeah, it, it, it's, it's, it's really a staggering number.



https:
00:41:14
And, you know, as you know, Ted, like one of the things I, I say all



https:
00:41:17
the time is that, um, in my view, the biggest threat to the crypto



https:
00:41:22
industry, uh, becoming adopted by the mainstream is not regulation.



https:
00:41:26
It's actually hacks and scams.



https:
00:41:29
And other related threats.



https:
00:41:31
And I think, um, a lot of the data that we saw published in the month of



https:
00:41:36
April, um, really underscores that.



https:
00:41:39
So 1.3 billion worth of crypto lost in Q1 2025 alone.



https:
00:41:45
So just the first quarter of this year.



https:
00:41:47
And as you mentioned, that representing 1% of the entire, what is it,



https:
00:41:52
the entire Bitcoin market cap.



https:
00:41:54
Uh, yeah, so that's a, that's a very big number.



https:
00:41:57
Um, that's a, it's a very big vulnerability, frankly, um,



https:
00:42:00
of this growing, um, digital asset based financial system.



https:
00:42:06
I mean, these things are happening on, on defi platforms.



https:
00:42:10
They're happening through, you know, social engineering



https:
00:42:14
where someone says, Hey.



https:
00:42:16
Take a picture of the, the QR code for your wallet and like, there's



https:
00:42:21
so many different things on do you are, what are some of the.



https:
00:42:24
The ones that, that you came across in doing the research that just, you're like,



https:
00:42:29
wow, I would've never thought about that.



https:
00:42:31
Generally, um, take a couple different forms.



https:
00:42:34
So, um, hacks of exchanges, that's always been a threat.



https:
00:42:38
And, you know, we, um, had the recent buy that hack, I believe



https:
00:42:42
that was in March on April.



https:
00:42:43
But, um, that was the, at that time the biggest, became the biggest



https:
00:42:48
hack, uh, of an exchange ever.



https:
00:42:51
Happening happening in 2025.



https:
00:42:53
Uh, we've got scams.



https:
00:42:54
To your point, that's been a growing concern.



https:
00:42:57
Uh, um, and you know, there are even.



https:
00:43:00
Um, by, by many accounts, um, large operations overseas that are all fully



https:
00:43:08
with like the lots of people dedicated to proliferating these scams where



https:
00:43:12
they're just looking to trick people, uh, into sending them their cryptocurrency



https:
00:43:17
or trick people into giving them credentials that allow them to hack



https:
00:43:20
someone's cryptocurrency accounts, um, or company's cryptocurrency accounts.



https:
00:43:25
Um, and then we've got Defi Hacks.



https:
00:43:26
So just a couple data points, um, from April alone.



https:
00:43:30
Uh, in April, $90 million worth of crypto was stolen from Defi platforms.



https:
00:43:36
Um, some of those, some examples, uh.



https:
00:43:39
We had hacks of the Aber Cadabra Money Defi platform, the ZO platform, and more



https:
00:43:47
recently the the Luke Scale platform.



https:
00:43:51
These are all popular Defi platforms that were hacked for 13 million,



https:
00:43:57
8.4 million, 5.8 million in crypto.



https:
00:44:00
Um, not enormous, but enough to really, uh, it adds up.



https:
00:44:04
Yeah.



https:
00:44:05
And, and diminishes trust, you know, and I think that's another big factor.



https:
00:44:10
Yeah.



https:
00:44:10
From my perspective, it makes sense.



https:
00:44:11
Like the, the folks who are more technologically or technical savvy



https:
00:44:16
would be less prone, uh, to, to some sort of malicious attack



https:
00:44:23
or hack or something like that.



https:
00:44:25
But it seems to be, at least for right now, and maybe it's vibe



https:
00:44:29
coding that's causing this to happen.



https:
00:44:31
But you know, they're coming through, uh, API hacks, they're coming through,



https:
00:44:39
uh, Python packages, like all these different things that are coming on



https:
00:44:44
that you would think that someone who understands the technology at that layer



https:
00:44:51
would, would know what to look for.



https:
00:44:53
It, it like.



https:
00:44:55
That's surprising to me.



https:
00:44:56
Yeah.



https:
00:44:56
And that's an example of a new a, a growing attack vector.



https:
00:45:00
And I think a sign that some of these attacks are becoming more



https:
00:45:02
sophisticated and looking to target more sophisticated victims, people



https:
00:45:06
that are likely to use crypto or maybe likely a whole large amounts of crypto.



https:
00:45:11
Um, but to your point, you know, in April we, we reported on, um,



https:
00:45:15
two pretty sophisticated hacks where the hackers didn't attempt



https:
00:45:19
to hack the victim directly.



https:
00:45:21
Instead, the hackers.



https:
00:45:23
Um, altered and inserted malware, uh, crypto malware into popular,



https:
00:45:31
uh, programs that are, um, popular among crypto users to download and



https:
00:45:37
deploy in various applications.



https:
00:45:39
So, you know, that's a sign that you see hackers targeting, um, more sophisticated



https:
00:45:44
users, whether those might be companies that are building their own crypto



https:
00:45:49
infrastructure like we talked about.



https:
00:45:50
The proprietary staking services earlier, uh, or maybe, uh, they're targeting



https:
00:45:55
more sophisticated users who are more likely to hold crypto on their own rather



https:
00:45:59
than on, on a third party exchange.



https:
00:46:01
Uh, and likely to hold, frankly, more crypto, you know, higher volumes.



https:
00:46:06
Um, and obviously the hackers are interested in that.



https:
00:46:10
Oh yeah.



https:
00:46:10
The, the bigger the honey pot, the, the more bears will come,



https:
00:46:14
come trying to get to that honey.



https:
00:46:16
So, totally.



https:
00:46:16
Got it.



https:
00:46:18
You know, we've covered a bunch of stuff today.



https:
00:46:19
Obviously we can't cover everything that happened in April, but these are the



https:
00:46:22
ones that, that we really identified and thought were important to bring up.



https:
00:46:29
One of the things that's important to note is what we've noticed in April is



https:
00:46:33
that the Web3 landscape, um, seems to be on that tipping point from the theory of



https:
00:46:41
what could be to starting to move towards the execution of what can be and really



https:
00:46:48
is giving us the next steps of what to do and how to get there and how to enable it.



https:
00:46:56
And I can only imagine.



https:
00:46:58
The number of announcements that come out in May are just going to



https:
00:47:02
continue to come, especially with these historic changes that we've had so far.



https:
00:47:09
Rob, what?



https:
00:47:09
What are some of the things that, that you think we might.



https:
00:47:13
Might see happen in May that were just signals being sent to us in April.



https:
00:47:20
Well, I certainly think we're going to see this continuation of, um, developments



https:
00:47:26
in stable coins, and I think we're gonna see more people enter that market.



https:
00:47:29
Uh, the players that are already in that market looking to launch new products.



https:
00:47:32
Maybe there's products that are.



https:
00:47:34
Getting ready to be launched behind the scenes, uh, that



https:
00:47:38
could make a, a large impact.



https:
00:47:40
Um, but I absolutely think stable point applications, integration



https:
00:47:43
between traditional crypto firms, Web3 firms with traditional financial



https:
00:47:47
services firms will absolutely for you, uh, continue to be a trend.



https:
00:47:52
I think it'll be interesting to see, um.



https:
00:47:56
How the regulatory environment in the US continues to evolve.



https:
00:47:59
You know, as we talked about, we've seen a clear 180 degree



https:
00:48:02
shift, a, a clear sea change.



https:
00:48:05
And then, um, you know, will we see more developments along those lines in may?



https:
00:48:10
Probably, uh, what form will they take?



https:
00:48:13
It's hard to say.



https:
00:48:14
And so that, that will be interesting.



https:
00:48:15
And then at some point we're gonna sort of, the regulatory environment



https:
00:48:19
should shift focused from sort of.



https:
00:48:23
Dismantling the policies of the prior administration to then building



https:
00:48:28
kind of the foundational policies of the current administration.



https:
00:48:31
We're seeing some of that with the SEC statements that we talked



https:
00:48:35
about today, but I think we're gonna see more and more of that.



https:
00:48:38
Um, the SEC is gonna continue its roundtables where it's



https:
00:48:41
receiving input from the public, um, on, um, oh, you know what?



https:
00:48:47
That round.



https:
00:48:49
So the, the last round table of, of, of April, um, I, I did,



https:
00:48:54
I did, uh, watch it, uh, live.



https:
00:48:57
Uh, it was very informative.



https:
00:48:59
Um, if you watch it on YouTube, um, go ahead and bump it up to like five



https:
00:49:05
x. Um, that, that'll get you there.



https:
00:49:09
Or, or just copy the transcript.



https:
00:49:11
Throw it in the chat, GPT and read through it.



https:
00:49:13
It'll, it'll help you out and it'll save yourself at least four and a half hours.



https:
00:49:20
And, well, folks, I. That's it for this episode of Web3 with FTC.



https:
00:49:25
If this discussion about Web3 got your attention today, that's great because



https:
00:49:30
there's more from where this came from.



https:
00:49:32
So go ahead, head over to YouTube, Spotify, apple Podcasts,



https:
00:49:36
or wherever you listen, I.



https:
00:49:38
Hit that follow button, and if you want to stay plugged into everything



https:
00:49:41
we're doing and everything we're tracking here, go over to FinTech



https:
00:49:45
confidential.com and sign up because that's where all the deep dives live.



https:
00:49:49
As well as the future episodes, you'll be able to learn more and be sure to share



https:
00:49:54
this with someone who's serious about where FinTech is going, and as always.



https:
00:49:59
Keep moving forward as we wrap up today's episode.



https:
00:50:02
I've got one last thing for you.



https:
00:50:04
If you are in the trenches fighting fraud and financial crime, you



https:
00:50:08
know it's a complex battlefield.



https:
00:50:10
That's where Hawks AI tools for real-time payment screening



https:
00:50:14
a ML transaction monitoring.



https:
00:50:17
And dynamic customer risk rating come into play.



https:
00:50:20
These aren't just buzzwords.



https:
00:50:22
They're game changers.



https:
00:50:23
Designed to make your compliance more effective and less of a headache.



https:
00:50:27
Imagine slashing through false positives with precision and giving your



https:
00:50:32
compliance strategy the edge it needs.



https:
00:50:35
Head on over to https://getHawkai.com to sign up for a demo and discover how



https:
00:50:41
their platform can revolutionize how you fight fraud and financial crime.



https:
00:50:47
This has been a production of DD three Media with all rights reserved.



https:
00:50:51
This is provided for informational purposes only.



https:
00:50:54
It is not offered or intended to be used as legal, tax, investment,



https:
00:50:57
financial, or other advice.



https:
00:50:59
We strive to provide accurate and up-to-date information, but will



https:
00:51:02
not be responsible for any missing facts or inaccurate information.



https:
00:51:06
You comply and understand that you should use any of this



https:
00:51:09
information at your own risk.



https:
00:51:11
Cryptocurrencies are highly volatile financial assets, so research and



https:
00:51:14
make your own financial decisions.