Crypto Legislation Showdown: House Republicans and the Central Bank Digital Currency Debate

Let's get to the big story breakdown.

House Republican leaders pulling the plug on a planned revote Tuesday after hardline conservatives blocked a procedural measure over crypto legislation.

The sticking point a demand to include language banning a central bank digital currency.

But Trump stepped in and says he has persuaded the holdouts to vote in favor of the crypto bills.

Meanwhile, strategy, the Bitcoin proxy popularized by Michael Saler bought over 4200 Bitcoin last week. $72 million according to a regulatory filing and Japan's Metalant revealing a $94 million purchase of 797 Bitcoin earlier this week.

Well joining me here at the New York Stock Exchange in midweek is John Agostino, institutional head of strategy at Coinbase.

John, so great to have you back here.

Thanks for joining me.

Thanks for having me again.

Well, great to have you here.

We know it's crypto Week in DC, so what do you make of what's happening in the nation's capital?

So it's been a very exciting 16 hours.

There were a lot of very upset people on Twitter on X sorry, when this procedural issue kind of this little snap po popped up.

I think we've already seen those fears abate.

Polymarket is still holding the Genius Act is passing very soon at over 96%.

It's still holding the Clarity Act is passing in 2025 at roughly around the same level, and we saw that tweet from Trump which sort of reiterated the tremendous political momentum behind this issue.

You have a brilliant guest coming on after me, Catherine Daley, who gets more into the weeds of that of that DC stuff, but my understanding is it was this really misunderstanding around language that a lot of people think is already in the bill that makes it very difficult to impossible for CBCs to exist at the federal level, but I think either there will be some adjustment of that language or people will accept that that language is already in and it looks like we are going to have a very positive conclusion very soon.

So we'll keep an eye on what comes out of DC this morning, but I do want to shift our focus on over to Bitcoin, in particular corporate treasury companies with crypto.

So earlier this week we saw Bitcoin hit new record highs above that 120 level to breach 123K.

So that is significant, but tell us why we're reading all these headlines about companies and their crypto holdings.

So I think there's two things going on.

First and foremost is People, investors want to control their capital, they want to control how it's stored and they want to control where it's invested and I think what we saw in the last election was a very loud populist movement to say we want to control our money and so.

There still are there's wonderful access vehicles now for crypto.

You've got ETFs.

You can buy spot directly on firms like Coinbase.

There's multiple options to hold that through a centralized custodian exchange, self custody.

It's still for the average person it's still a little bit challenging once you get past Bitcoin, particularly challenging if you want to attract yield, if you want to invest in yield.

Um, so these crypto treasury firms and their popularity are clearly showing an almost insatiable appetite, not just amongst the crypto natives that have been supporting this ecosystem for 7 to 10 years, but for average retail investors.

Um, so we kind of knew this, right, we knew this because of the extraordinary success of the ETFs.

I mean, just to just to reiterate, I think this is, this is been announced publicly, the Bitcoin ETF is the most profitable ETF for BlackRock.

That's an extraordinary thing.

I think I said this once on your show before, but I think it's worth saying again.

These products have been so popular despite not being allowed to be sold by the vast majority of investment advisors, right?

So if you just step back 10,000 ft and say if you could draw on a whiteboard your dream as a product designer for a financial institution, you could not have done better with these access vehicles.

But they are somewhat limited, right?

We only have them in a certain number of underlying tokens.

They're direct core single asset beta.

They don't produce yield.

So if I want to do other stuff now I see this extraordinary success.

My mother is now calling me saying how should I invest in crypto and so that community of new users will want simple options.

There's nothing simpler than a stock ticker.

So you have that's 11 drive.

I think another drive is you do have a lot of spack vehicles that are nearing the end of their tenure.

We have this big spack boom about 18 months ago, 2 years ago.

A lot of those facts now are at the sort of the end of their their time period, and so they're efficient vehicles.

To use to go public and there's there's a number of them.

So you've got a clean simple mechanism to go public.

You've got massive investor desire for simple access vehicles for either down the stack crypto token beta or yield generating beta.

And so we are where we are, which is this deluge of launches.

Yeah, and you bring up a lot of important points.

We could actually do an entire podcast on this subject, but for viewers out there who are wondering why are certain companies holding Bitcoin on their balance sheet and it's no longer Bitcoin as well as other cryptocurrencies as well.

So what are the implications for investors out there, retail investors who are thinking, wait a second, this company just holds crypto.

So two very simple broad characterizations of corporate crypto treasury firms.

One is a firm that's an existing operating company that says, you know what, we want to take our Treasury assets, which is usually cash, and we want to buy crypto with it, and we have our operating business and that generates revenue and income.

And then also now we think that this is a better use of our Treasury pool.

Um, that's different from the listing of a firm whose sole purpose is to hold crypto, which I would argue is effectively an access vehicle, an efficient access vehicle, and they'll have all different strategies.

Some will be just we're going to hold Bitcoins, some we're going to hold the top 10 interesting tokens, some will be we're going to generate yield from our tokens, so all a myriad of options that you have.

So those are the two.

Broad characteristics.

Some investors prefer option 2.

Some investors say, you know what, I want this crypto exposure.

The operating company is a distraction to me.

Other investors might say, you know what, I like the idea that there's an operating company, a brick and mortar company, if you will, that's earning revenue completely outside of crypto.

Maybe that offsets some of the risks associated with crypto holding or vice versa.

So.

The key point is access options and under the guide of the stock exchange under that process of listing that S1 or that S4 that you have to file that should give investors confidence that those companies are well run by high quality management teams and it'll be up to them to choose which way they want to go.

Well, John, unfortunately I will have to leave it there, but hopefully we'll have you back on very soon so we can continue the discussion.

Always a pleasure.

Thank you so much for joining me.

Take care.