The Summer Surge: Companies Betting Big on Bitcoin and Crypto

Mm.

The hottest trade of the summer and it's not stocks or tech.

Companies around the world, from Japanese hotels to Florida toy makers are raising billions, not to hire or expand, but to buy Bitcoin and other crypto.

Since June '98, companies have announced plans to raise over $43 billion for crypto buys, and that's double what's been raised in US IPOs this year.

The move has triggered a surge in digital tokens and companies.

Well, big names are backing the trend, but skeptics warn this could be a bubble.

Well, joining me to weigh in is Austin Campbell, founder of Zero Knowledge Group and teacher at NYU Stern School of Business.

Great to have you here, Austin.

Welcome back.

Thank you very much.

Happy to be back.

Well, your latest newsletter, Defi Delulu.

So tell us why you named your newsletter by that.

Oh boy.

Crypto has a long trend, I would say, of taking things that have been done in finance, overdoing them, and then blowing them up to relearn those exact lessons and the behavior remains sort of to be gentle about it, misguided and delusional at times, I think we're looking at maybe another one of those trends this year.

Yeah, and Austin, since you were last on the show, the Genius Act has been signed into law, but there's still a lot that we're still anticipating as we head into the second half of 2025.

So I do want to ask you about what we've been seeing in terms of digital asset treasury deals.

They are booming, but what are your takeaways?

So The digital asset treasury deals in a sort of disconcerting way for me, remind me of the MBS trend in the 2000s, which is to say like if you're familiar with the work of Hyman Minsky, the economist, there are these cycles when you see bubbles that start with very grounded forms of finance where people can pay their cash flow and finance all the debt, no problem.

And then you get into ones where basically they're just rolling debt to finance operations and then you get into ones where price appreciation is the only way they remain solvent.

Many of the digital asset treasury companies look like that.

So if you're familiar with the anatomy of what happened with subprime.

This, although in a way more contained way, like digital asset treasury companies cannot crash the economy.

They're not systemic enough, but pretty clearly, if you have a vehicle that needs to have price appreciation to continue to exist and function properly, eventually there's going to be a problem.

Yeah, and you and I were talking about how it's been a busy summer.

So whether we're talking about Trey or DFI, we've been paying attention to what's happening in the nation's capital.

So when it comes to the regulatory landscape for digital assets, what are you paying attention to?

So genius passed.

One question there is the implementation of that because Congress passes a bill, but then people have to do things with their hands.

And in this case it's the Fed and the OCC.

Which one controls the rulemaking will tell you something about the Trump administration's view of the banking regulators.

2, clarity is still hanging out there, and boy does the Senate have few points on that.

I think there's still going to be a big fight around what exactly will go in that bill and when and if it will move.

I'm optimistic, but there's going to be a lot of work.

Yeah, and it goes without saying legislation does take work and time for sure.

So what are the next steps that you're watching for in the near term?

So clarity hits the Senate and And it has been much less discussed and much less debated among the senators than it was in the House.

Honestly, a lot of it is an education effort because keep in mind if you're a senator, you have 50 things going at once, and crypto is probably priority number somewhere between 40 and 50 for you.

And so a lot of these people just are going to need a lot of time to get up to speed and understand what's in there.

And finally, before I let you go, I do want to get your take on the crypto majors in particular Bitcoin, as well as some of the action we're seeing not just in crypto majors but also out coins as well.

So we saw Bitcoin climb above 122.

Again, but here we are below 119.

So what do you make of the price action?

So Bitcoin has been doing this thing for a while of chopping sideways and then having steps up and then chopping sideways and then this looks sort of like classic accumulation.

And honestly, if you look at the monetary backdrop where we're still spending a ton of money, it makes sense that Bitcoin would just gradually be rising over time.

To me, the more interesting and perhaps confusing space is the alts because you know just today you're seeing news that more and more people like Stripe and Circle are launching L1s.

There's more competition coming there and it reminds me very much of the internet in the early 90s where it's all. and we don't really know who will survive yet.

Yeah, and stablecoins are an area that you're very familiar with, and I think Americans paid attention to the IPO we had here on the floor of the New York Stock Exchange with circles.

So what do you make of where we are right now stateside?

So we finally have legislation at the federal level demonstrating how stablecoins can be done and be done safely, which I think is a good way to move about things.

This is just the starting gun for lots of competition right now.

If you look at stablecoin issuers in the US companies, there's two Circle and PayPal.

I expect that number gets much bigger over the next few years.

Yeah, and very quickly we've been seeing headlines about some familiar names, including banks, tech companies, even retailers talking about issuing their own stablecoins.

So what do you make of that?

I think it's going to be very hard for the tech companies and retailers.

Keep in mind, if you read Genius, public companies that are not primarily financial companies are prohibited from launching stablecoins without exceptional permission by a board of people that includes the Federal Reserve, who I think will be very skeptical on these.

Efforts.

It will be a game played by financial companies.

I think the retailers will be integrating them and then the threat is to Visa and Mastercard.

OK, Austin, well, always great to have you here, dissect and break down what's happening below the surface.

So thank you so much for your insights on your perspective.

Thank you very much.

Thank you.