ကူးယူချက် 🔗
WEBVTT
00:00:01.439 --> 00:00:13.119
Well, I'm personally excited to be back today for this new episode of Cam Harvey's Through the Noise, where we're able to continue our conversation on stable coins.
00:00:13.679 --> 00:00:27.519
I uh went home after our last episode, and um you talked about Circle and Tether, but I also discovered that you know that the Trump-funded World Liberty Financial also has a stable coin.
00:00:27.600 --> 00:00:28.399
Is that correct?
00:00:28.879 --> 00:00:29.760
It does.
00:00:30.079 --> 00:00:33.679
So it's called USD1.
00:00:34.719 --> 00:00:37.119
So Circles is USDC.
00:00:37.920 --> 00:00:42.640
Uh and it is actually a fairly large uh stable coin.
00:00:42.880 --> 00:00:49.520
So um in terms of the capitalization of all crypto, uh tether is number four.
00:00:49.920 --> 00:00:54.000
So the most important uh stable coin in terms of capitalization.
00:00:54.240 --> 00:01:03.039
And then number six overall, and I'm counting Bitcoin, Ethereum, all of them uh together, uh, is USDC, which is Circle.
00:01:03.600 --> 00:01:07.840
And uh USD one is number 20 overall.
00:01:07.920 --> 00:01:10.079
So about 4.5 billion.
00:01:10.319 --> 00:01:13.359
Uh that is a sizable number.
00:01:14.000 --> 00:01:20.560
However, this is important, that it's not just world liberty financial.
00:01:21.120 --> 00:01:24.319
There are many different stable coins out there.
00:01:24.719 --> 00:01:26.000
So there's not a lot of barrier.
00:01:26.239 --> 00:01:29.519
If I wanted to go create my stable coin, I could go create Robert Stablecoin.
00:01:30.000 --> 00:01:33.359
I give my students the code to create one of these tokens.
00:01:33.840 --> 00:01:36.319
And and it's easy uh to do.
00:01:36.640 --> 00:01:40.879
So uh uh PayPal has got a stable coin.
00:01:41.120 --> 00:01:45.359
Uh Western Union is thinking of a stable coin.
00:01:45.760 --> 00:01:52.640
Every major bank in the world has got some initiative that is linked to stable coins.
00:01:52.959 --> 00:01:55.359
Okay, so so we will have stable coins all over the place.
00:01:55.439 --> 00:02:00.159
And yes, uh uh World Liberty uh Financial has got one.
00:02:00.319 --> 00:02:06.480
Uh I do want to kind of differentiate between uh a centralized and decentralized stable coin.
00:02:06.640 --> 00:02:06.879
Okay.
00:02:07.200 --> 00:02:24.000
So a uh centralized stable coin like Tether or Circle or PayPal, World Liberty Financial, these are companies where you send money to a company and then the company uh sends you tokens.
00:02:24.240 --> 00:02:41.280
Uh there are also decentralized stable coins where it is more uh like an algorithm uh that uh you're sending uh to uh like an algorithm your funds and it's sending back to you uh some tokens.
00:02:41.439 --> 00:02:47.120
Uh the decentralized stable coins are smaller, uh, but they are a very important part of the ecosystem.
00:02:47.759 --> 00:02:51.520
We'll have to get into decentralized versus centralized tokens for sure.
00:02:51.680 --> 00:03:10.240
The reason I brought this up is is I just want to get a sense of how we want to think about families of power, such as our president's family, being involved in highly regulated industries where um where you know it it might not seem uh so kosher.
00:03:11.120 --> 00:03:14.240
Yeah, so let's let's be careful here.
00:03:14.479 --> 00:03:23.280
So uh circle and world liberty liberty financial will be regulated under the Genius Act.
00:03:23.439 --> 00:03:28.800
The business model for their stable coin, at least, is very simple.
00:03:29.120 --> 00:03:42.639
And I've described it as you take uh some money, you send it to the centralized issuer, they put that in treasury bills or ultra-safe assets, and then issue you tokens.
00:03:42.800 --> 00:03:46.800
At any point, you can send uh your tokens back.
00:03:47.520 --> 00:03:58.879
As for family involvement, it is more complex than I think that uh the description in the mainstream uh media.
00:03:59.680 --> 00:04:15.759
So uh number one, uh it is it is hard to ask family members to step aside from all business uh ideas uh if your parent uh is in a position of power.
00:04:16.240 --> 00:04:22.240
It's hard to do, uh, and especially when that power is limited to four or uh eight years.
00:04:22.720 --> 00:04:33.199
Um and then this is also a bipartisan, I didn't say issue, uh, but I could say problem or challenge.
00:04:33.439 --> 00:04:34.560
I would say it's a global challenge.
00:04:34.879 --> 00:04:51.040
Yeah, globally, but even within the U.S., it wasn't that long ago that we were talking about Hunter Biden and Barisma holdings, him being on the board, um, and people thought that that was uh inappropriate.
00:04:51.199 --> 00:04:54.399
And indeed, the history goes back even further.
00:04:54.560 --> 00:05:05.519
Uh during Jimmy Carter's presidency, his brother Billy started to market a beer called Billy Beer, uh, and also was involved with Libya.
00:05:05.759 --> 00:05:09.439
So this is a problem that's not a new problem.
00:05:09.680 --> 00:05:11.040
It's an old problem.
00:05:11.519 --> 00:05:21.839
And I think that it is up to Congress to come up with guidelines as to what family members can do and cannot do.
00:05:22.000 --> 00:05:24.879
Uh and we don't have anything like that.
00:05:25.120 --> 00:05:31.519
It appears like a conflict of interest, but this is an ongoing problem uh that we actually uh face.
00:05:31.920 --> 00:05:38.000
But we do have there are regulations that that that these firms have to follow.
00:05:38.240 --> 00:05:45.839
Um I know that to to avoid kind of fraudulent issuances and things like that, we have lockup periods and we have other mechanisms.
00:05:46.000 --> 00:05:56.639
Can you maybe help us understand, you know, what if if I were to launch my stable coin, what uh or not stable coin, but some sort of crypto asset, what kind of what kind of rules might I have to follow?
00:05:57.360 --> 00:05:59.839
So those rules are being
Load full transcript
developed.
00:06:00.319 --> 00:06:14.879
So this is the Clarity Act, uh, whereas the stable coin rules are are pretty well set right now, uh given the Genius Act that was passed in uh December of 2025.
00:06:15.120 --> 00:06:32.560
And I think what you're talking about in terms of lockup is an issue with World Liberty Financial, and they have like a number of businesses, but the main thing is their token, which they call a governance token.
00:06:33.199 --> 00:06:45.439
And it was interesting to me that when those tokens were originally issued, uh they were not available for trade.
00:06:45.920 --> 00:06:49.759
So you're buying a token that you can't sell.
00:06:50.240 --> 00:06:52.000
And I thought it was very puzzling.
00:06:52.240 --> 00:07:06.959
And uh, as you know, this billionaire uh Justin's son, um, who bought a large chunk of these tokens uh and is currently in litigation with uh World Liberty of Financial.
00:07:07.360 --> 00:07:10.319
Um so again, you're buying a token you can't sell?
00:07:10.639 --> 00:07:12.240
How does that have value?
00:07:12.480 --> 00:07:22.160
Well, it turns out it had value because there was an expectation that some of the tokens would be unlocked.
00:07:22.639 --> 00:07:33.519
Okay, so uh it turns out that there was a vote of the token holders, and the token holders said, let's unlock 20% of the tokens.
00:07:33.839 --> 00:07:36.240
So is this self-imposed, this lockup?
00:07:36.560 --> 00:07:39.120
Uh it was part of the original deal.
00:07:39.279 --> 00:07:47.759
So you can see uh the deal, you're buying the token, it says very clearly that uh these are not uh like for sale.
00:07:47.920 --> 00:07:49.920
So you're buying something you can't sell.
00:07:50.079 --> 00:07:52.720
Like, can you imagine buying a stock that you couldn't sell?
00:07:52.879 --> 00:07:53.120
No.
00:07:53.279 --> 00:07:54.959
Yeah, that has no value.
00:07:55.120 --> 00:08:03.199
But again, they changed the rules, and this is in July of 25, to allow for 20% of those tokens to be unlocked.
00:08:03.360 --> 00:08:07.839
Now, look, lockup periods are common in the stock market.
00:08:08.079 --> 00:08:14.240
So there's an initial public offering, and insiders uh cannot sell for a certain period of time.
00:08:14.399 --> 00:08:15.600
So you're locked up.
00:08:15.839 --> 00:08:23.439
Or an executive within the firm uh gets an award of some stock, and there's a lockup period before you can sell.
00:08:23.600 --> 00:08:25.439
Lockups are common.
00:08:25.680 --> 00:08:30.959
In this particular case, the initial token holders, there was no lockup period.
00:08:31.040 --> 00:08:32.559
You just couldn't sell a token.
00:08:32.960 --> 00:08:40.799
Then in July, uh there was uh a change in the rules so that 20% could be sold.
00:08:40.879 --> 00:08:46.879
And there's an expectation there'd be another vote later in the future where more of these can be sold.
00:08:47.039 --> 00:08:54.320
Again, I want to emphasize this is their governance token,
it has nothing to do with the stable coin, nothing to do with that whatsoever.
00:08:54.559 --> 00:09:13.600
So um Justin Sun had 800 million tokens unlocked, and what his lawsuit is about is um that the selling of those tokens has been blocked by World Liberty uh Financial.
00:09:13.840 --> 00:09:20.639
He believes that's unfair, so he has issued um a lawsuit as a result of that.
00:09:20.799 --> 00:09:24.000
And uh the details, some of the details we just don't know.
00:09:25.200 --> 00:09:29.440
So I'm getting confused by a lot of these um lockups and things like that.
00:09:29.600 --> 00:09:34.480
And perhaps you talked a little bit about this earlier, but maybe helped me understand.
00:09:34.559 --> 00:09:35.759
Is is what what's going on?
00:09:35.919 --> 00:09:40.799
Is that a is this decentralized or is this a centralized um uh token?
00:09:40.879 --> 00:09:51.840
I think Yeah, so this is interesting and it's very important to understand the difference between centralized and decentralized.
00:09:53.120 --> 00:10:00.080
Um so I've already described the circle and tether for stable coins are centralized.
00:10:01.120 --> 00:10:10.080
Um World Liberty Financial uses uh the terminology of decentralized finance.
00:10:10.240 --> 00:10:14.720
So, for example, they call their token a governance token.
00:10:15.519 --> 00:10:20.240
However, this is highly centralized.
00:10:20.960 --> 00:10:22.320
So this is a company.
00:10:22.799 --> 00:10:26.960
It is a company that is registered in Florida.
00:10:28.240 --> 00:10:34.080
They control 60% of the so-called governance.
00:10:34.320 --> 00:10:35.919
So this is not decentralized.
00:10:36.080 --> 00:10:47.600
Usually in what we call a decentralized autonomous organization, you've got the tokens spread around and and there are votes for various uh provisions.
00:10:47.840 --> 00:10:54.159
No, you've got one centralized entity determining the rules.
00:10:54.399 --> 00:10:58.240
So that July uh 20 uh because they own the votes.
00:10:58.960 --> 00:11:02.320
Because they got the majority, a clear uh majority.
00:11:02.559 --> 00:11:05.120
Um so so this is uh very clear.
00:11:05.279 --> 00:11:12.799
There's other unusual provisions, so that there is this entity called DT Marks DeFi LLC.
00:11:12.879 --> 00:11:22.639
I know that's a mouthful, but that is a Trump family uh entity that also gets 75% of the revenue from the token issuance.
00:11:22.799 --> 00:11:26.159
So that's also very uh unusual.
00:11:26.480 --> 00:11:37.279
Uh so again, for those in the space, we see this as a centralized company using the language of decentralized finance.
00:11:37.679 --> 00:11:39.360
So give me kind of a smoke test.
00:11:39.440 --> 00:11:44.639
If I'm trying to get engaged with these kind of tokens, how would I what are the questions I should be asking myself?
00:11:45.120 --> 00:11:46.559
This is really key.
00:11:46.720 --> 00:12:02.639
And this is uh this is kind of the number one lesson that investors need
to uh to learn, and that is before investing in anything, you need to understand what you're investing in.
00:12:03.039 --> 00:12:12.399
So people might be describing something uh in the words of decentralized finance, but you need to look under the hood.
00:12:12.639 --> 00:12:14.240
What is actually going on here?
00:12:14.399 --> 00:12:19.519
So I'm buying a token that appears to be permanently locked up.
00:12:19.840 --> 00:12:21.679
So that is risky.
00:12:22.000 --> 00:12:36.799
Um and then some of the token is unlocked, but given that there is an entity with majority control, they can re-lock and and and refuse redemption.
00:12:37.039 --> 00:12:44.240
Uh so this is uh this is something that all investors have to do.
00:12:44.399 --> 00:12:50.159
They have to understand what the risks are when they actually invest in something.
00:12:50.320 --> 00:12:58.320
Now, I want to be careful here uh because uh uh I want to emphasize that I don't have all the information here.
00:12:58.559 --> 00:13:10.080
So Justin Sun in particular signed what's known as uh like a token agreement, a purchase agreement, a TPA, it's sometimes called.
00:13:10.399 --> 00:13:14.639
And I don't know uh all of the details of what he uh signed.
00:13:14.799 --> 00:13:16.960
So that's just another layer.
00:13:17.200 --> 00:13:33.759
So uh uh this situation is in the media, obviously, because the president's family uh is involved, um, and the CEO is actually um the uh the son of Steve Whitkop.
00:13:34.159 --> 00:13:37.039
So another official in the administration.
00:13:37.200 --> 00:13:42.320
So it's in the media focus, but I think the lessons here are really clear.
00:13:42.559 --> 00:13:54.399
So if you're buying some crypto token, you need to understand whether it's centralized or decentralized, and that impacts your ability to potentially sell uh that token.
00:13:54.559 --> 00:14:00.000
And then the second lesson yes, they're in the stablecoin uh business, but they're not alone.
00:14:00.159 --> 00:14:04.240
Uh there are so many companies in this business now.
00:14:04.399 --> 00:14:06.960
The barrier to entry is very low.
00:14:07.279 --> 00:14:09.759
Stablecoins solve an important problem.
00:14:09.919 --> 00:14:11.919
They're just one of the players.
00:14:12.080 --> 00:14:17.679
And it turns out that they're not a really small player, they are a substantial player.
00:14:17.919 --> 00:14:23.519
So, so again, this is all about understanding what you're investing in.
00:14:24.080 --> 00:14:24.639
Well, thank you.
00:14:24.720 --> 00:14:41.519
I mean, I I feel like what we're we're getting into is is looking at things that seem simple, discovering kind of their complexity, and trying to come up with some basic ways for us to understand this new this new space and simple questions that we can ask and simple ways we can understand.
00:14:41.679 --> 00:14:43.679
So thank you for taking the time to discuss it with us.
00:14:43.840 --> 00:14:48.639
I know this is a this is there's some tricky topics here, but I hope we address them in the right way.
00:14:48.960 --> 00:14:49.600
Thank you.