From exchanges to stablecoins to treasuries, the crypto industry is branching out now.
Crypto exchanges generating billions in free cash flow, and they could also grow if the cardiac passes.
Now this week, Hong Kong's prestige Walt rebranded as a rally in Treasury as it holds millions in gold.
Digital asset treasuries are struggling with Metalant below in market net asset.
You of one this week.
Meanwhile, stablecoins continue to rake in hundreds of billions with banks expected to launch their own.
Well, joining me to weigh in is William Quigley, co-founder of Wax and Tether.
Well, great to have you back on.
Thank you so much for joining me.
So let's talk about Aelian Treasury.
They launched as a tether gold backed Treasury that raised $150 million in financing.
So first and foremost, what's your take on this?
Well, I think it's a natural sort of a progression.
We started with tokenizing fiat, you know, US currency, then other currencies, and the next logical place to go is commodities.
It's taken a long time, you know, we've been talking about this for many, many years that blockchains are very good at tokenizing and allowing things to move cross border really efficiently, which is what blockchain technology allows, and gold is clearly in high demand.
Lots of people trade it, so when you tokenize something, you would like to do that with an asset that's globally traded and where there's, you know, persistent demand, and I think it's an obvious place to start.
It'll be one of many other commodities that eventually also get tokenized.
Yeah, and well, I want to get your take on crypto exchanges.
I understand that you believe crypto exchanges are the most profitable businesses outside of stablecoins and Dei.
So explain this to us.
Yeah, so crypto exchanges have really always been the most profitable area, most profitable type of company within crypto, because they're incredibly simple to to build and to operate, you know, the scalability of an exchange, once it's developed its platform, whether it's trading $100 million a day or $100 billion a day.
There's, there's, yeah, you need some additional technology, but not that much.
So, uh, exchanges have always for the last 10 years they've been making, you know, billions of dollars in free cash flow, um, and, um, the exchange is really also, um, I think they are responsible for a lot of the volatility in the movement of crypto prices because a lot of exchanges, I believe, you know, trade on their own behalf, so they're a powerful force in crypto.
Yeah, and speaking of power as well as volatility, especially on the heels of last Friday's sell-off, we did see Metaplat fall below an MNAT of 1 this week.
Market cap is less than the net value of its underlying Bitcoin holdings.
So can you explain to us why are you skeptical of debts?
I'm, I, so that's are for your audience, you know, they're businesses that whose really sole purpose is to acquire crypto.
They could have done it with anything else.
They could acquire a quantity of gold or an individual stock, but they, right now the DATs are acquiring crypto, and I think the idea is that it's easier to, to.
To buy the crypto, if you can just buy a stock that that is a proxy for the crypto.
But I guess I would say I think with ETFs it's easy to get Ethereum and Bitcoin and probably soon other cryptos as well.
And if you really want to go long on a crypto, my suggestion is you just buy the native crypto as opposed to buy a company where some management people are holding the crypto and having maybe some plans for how they can generate additional yield maybe by using leverage.
I think you're already in an asset that's highly volatile.
And so to add to the uncertainty of and the behavior of that way that asset trades by having an intermediary hold it for you, I think is a mistake.
And I do think most of these digital asset treasury companies ultimately will trade below their net asset value of their holdings.
Well, we'll keep a close eye on deaths as we head into year end and finally, while I have you here, well, I believe that you have said stablecoins are blockchain's greatest innovation even more than Bitcoin.
So why are you so bullish on stablecoins, especially when it comes to innovation.
Um, the answer could be very long.
I'll make it brief.
Tokenizing money is bigger than digitizing it.
We started to digitize money in like the 1950s and 1960s.
By tokenizing it, you ensure that there can be no counterfeiting.
You insure almost instant settlement cross border, and you can eliminate almost all fees, and it's very transparent.
And so I just think it's a, it's a, it's a better way for money to exist and all of the world's global economies at some point will tokenize their currencies.
So it's going to dwarf any individual crypto, including, including Bitcoin.
Well, Will, always great talking to you.
Thank you so much for joining us this morning and as always, thank you so much for sharing your insights.
Thank you.
