[ { "i": 0, "speaker": "Speaker 1", "text": "live from Bloomberg's world headquarters in New York. I'm Scarlett Fu >> and I'm Tim Stenc. Welcome to Bloomberg Crypto. It's a look at the people, transactions, and technology shaping the" }, { "i": 1, "speaker": "Speaker 2", "text": "world of decentralized finance." }, { "i": 2, "speaker": "Speaker 2", "text": ">> Here is what's at stake today. Bitcoin in a bit of a freef fall, dropping to around $67,000." }, { "i": 3, "speaker": "Speaker 2", "text": "its lowest level since April." }, { "i": 4, "speaker": "Speaker 1", "text": ">> In just a moment, we're going to speak about this price action in the future of crypto with Franklin Templeton CEO Jenny Johnson and Blockstream CEO Adam Back >> and JP Morgan CEO Jamie Diamond sounding" }, { "i": 5, "speaker": "Speaker 2", "text": "off on Coinbase as the debate over the Clarity Act intensifies." }, { "i": 6, "speaker": "Speaker 1", "text": ">> All that and more over the next hour right here on Bloomberg Crypto. First though, let's get a check on how Bitcoin is looking. As Scarlet mentioned, Bitcoin below $68,000 for the first time" }, { "i": 7, "speaker": "Speaker 1", "text": "in two months. We're seeing some areas of the market rally, deteriorate right now at its lowest level going all the way back to April 8th. You can see that Bitcoin ETFs have seen outflows for a" }, { "i": 8, "speaker": "Speaker 1", "text": "record 11 straight days as sentiment shifts. Here's an interesting comparison. If we think back to the end of March, Scarlet, Bitcoin is actually pretty much flat going all the way back" }, { "i": 9, "speaker": "Speaker 1", "text": "to the end of March. But think about the risk on sentiment that we've seen across markets. The S&P 500 over that exact same period of time up around 20%." }, { "i": 10, "speaker": "Speaker 2", "text": "Scarlet." }, { "i": 11, "speaker": "Speaker 2", "text": ">> Yeah, it's pretty incredible. And sentiment actually took a turn for the worst yesterday when Strategy announced that it sold 32 Bitcoin for about $2.5 million. That marks the company's first" }, { "i": 12, "speaker": "Speaker 2", "text": "sale of the token since 2022 and it follows comments from CEO Michael Sailor about possible sales. Now, to be fair, Strategy still holds some $60 billion in Bitcoin. So, this is kind of a drop in" }, { "i": 13, "speaker": "Speaker 2", "text": "the bucket, but notable nonetheless for a company that had really staked its claim on this Bitcoin maximalist strategy. Yeah, we're going to speak about that in just a few minutes with" }, { "i": 14, "speaker": "Speaker 1", "text": "Bloomberg's Mon'nique Mima. In the meantime, we're going to take a quick break. We'll be back with more Bloomberg Crypto right after this." }, { "i": 15, "speaker": "Speaker 2", "text": "All right, this is Boomer Crypto with Tim Stenic and Scarlett Fu. And joining us now to talk from the proofof talk conference in Paris is Blockstream co-founder and CEO Adam Bach as well as" }, { "i": 16, "speaker": "Speaker 2", "text": "Jenny Johnson, the CEO of Franklin Templeton. They spoke this morning on a panel discussion, a fireside chat actually about the institutional adoption of Bitcoin, the continued efforts there and digital assets. And" }, { "i": 17, "speaker": "Speaker 2", "text": "we'll get to that shortly. But Adam, I want to come to you first because Tim and I were just talking earlier about the price action in Bitcoin and how it has really taken a turn for the worst." }, { "i": 18, "speaker": "Speaker 2", "text": "Uh last October was a high water mark for Bitcoin and since then it has struggled to hold on to some key levels like $100,000 90,000 80,000 and today 70,000. So I just want to start with you" }, { "i": 19, "speaker": "Speaker 2", "text": "in terms of looking at Bitcoin. How would you describe or characterize market sentiment on Bitcoin right now?" }, { "i": 20, "speaker": "Speaker 3", "text": ">> Yeah, I mean it seems to be possibly a technical selloff. Doesn't seem to be any kind of particular sentiment attached to it. So it could be somebody uh selling like a bankruptcy liquidation" }, { "i": 21, "speaker": "Speaker 3", "text": "or a seizure that isn't visible in the market. Um and I think the you know the interesting technical is the 200E moving average which has been you know which goes up over time. It's currently around" }, { "i": 22, "speaker": "Speaker 3", "text": "61,000. So interesting to see that. And of course the recent market bottom was also 60,000 going back a few months ago." }, { "i": 23, "speaker": "Speaker 1", "text": "Yeah, Jenny, I want you to come on in on this and and just talk a little bit about how this price action has affected institutional adoption. As we mentioned a few minutes ago, Bitcoin ETF flows" }, { "i": 24, "speaker": "Speaker 1", "text": "have seen outflows for a record 11 straight days. Sentiment has shifted. Um I'm just curious what you're seeing and or hearing rather from institutions right now in terms of their interest" }, { "i": 25, "speaker": "Speaker 4", "text": "around Bitcoin." }, { "i": 26, "speaker": "Speaker 4", "text": ">> So my my instinct is if there's price action on there that's going to be much more of a retail. institutions tend to be a little bit longer term. Once they've made a decision to uh to have it" }, { "i": 27, "speaker": "Speaker 4", "text": "as part of their portfolio, they'll ride through the volatility. Uh and what we've seen really in um 2026, I'd say, is a broader interest, you know, we we announced the acquisition of of 250" }, { "i": 28, "speaker": "Speaker 4", "text": "digital. Yeah." }, { "i": 29, "speaker": "Speaker 4", "text": ">> And what's been interesting, it's a it's a crypto venture fund, is we've had a couple of institutional clients who have said, now that this is going to be owned by Franklin Templeton, we're" }, { "i": 30, "speaker": "Speaker 4", "text": "comfortable. we've wanted to allocate to the space, but we wanted to have a bigger firm kind of behind it. So, I think you're seeing much more interest from the institutional players to get" }, { "i": 31, "speaker": "Speaker 2", "text": "into the space." }, { "i": 32, "speaker": "Speaker 2", "text": ">> You've got institutional demand, you've got retail demand, you've also got corporate demand for Bitcoin. Uh, Michael Sailor Strategy, as we were reporting earlier, pursued this maximalist playbook that uh basically" }, { "i": 33, "speaker": "Speaker 2", "text": "made it the biggest corporate holder of Bitcoin. But as we noted, the company sold $2 and half million dollars of Bitcoin after selling almost $12 million of the token in late 2022. Obviously, $2" }, { "i": 34, "speaker": "Speaker 2", "text": "and half million is nothing when you compared to its overall holdings of about $60 billion in Bitcoin. But Adam, this comes at a pretty sensitive moment for Bitcoin and market psychology. Is" }, { "i": 35, "speaker": "Speaker 3", "text": "Bitcoin maximalism dead?" }, { "i": 36, "speaker": "Speaker 3", "text": ">> No. He preageded it by talking about it on uh recent interviews and it was really just to convey to the market that they have the ability to pay well it it doesn't even pay the monthly interest" }, { "i": 37, "speaker": "Speaker 3", "text": "rate on the uh stretch instrument but to convey to the market that look you can sell Bitcoin and pay dividends with it." }, { "i": 38, "speaker": "Speaker 3", "text": "Um, you may recall a while back they sold a lot of shares at the market and kept the cash to demonstrate to the market that they had a lot of cash to pay the dividends and now they wanted to" }, { "i": 39, "speaker": "Speaker 3", "text": "show that they could pay the dividends using Bitcoin and indeed they used that cash or or a good part of it to buy back one of the convertible notes and reduce their debt ratio. So I think it's just" }, { "i": 40, "speaker": "Speaker 3", "text": "you know trying to show the market uh how to value Bitcoin that Bitcoin is liquid and therefore to not need to keep that kind of cash reserve around in future." }, { "i": 41, "speaker": "Speaker 2", "text": ">> And Adam I bring this up because you're a co-founder and CEO of a treasury company yourself Blockstream. Have you sold any Bitcoin? When would it be appropriate to do so if you haven't?" }, { "i": 42, "speaker": "Speaker 3", "text": ">> Uh so there's two companies." }, { "i": 43, "speaker": "Speaker 3", "text": "Blockstream's private company also has Bitcoin on the balance sheet and Bitcoin standard treasury which is a separate company and that's still waiting regulator approval uh priced on close so" }, { "i": 44, "speaker": "Speaker 3", "text": "we're not in a position to do any any actions at this point." }, { "i": 45, "speaker": "Speaker 1", "text": ">> All right uh Jenny I want to bring you back in here and talk more about this uh acquisition of 250 digital use tokenized money market fund to uh to partially settle an M&A transaction. sounds like" }, { "i": 46, "speaker": "Speaker 1", "text": "uh it's proof of concept or I think something much bigger as as people have spoken about on our program over the last couple of months. Is the endgame that all of Franklin Templeton's" }, { "i": 47, "speaker": "Speaker 1", "text": "corporate transactions, fund launches, acquisitions, partner settlements eventually run onchain?" }, { "i": 48, "speaker": "Speaker 4", "text": ">> Look, I I believe that the financial services system will ultimately run on blockchain just because the technology creates tremendous efficiencies." }, { "i": 49, "speaker": "Speaker 4", "text": "Um, you know, these these guys were they're very big in the space and they were happy to receive their tokenized money market fund, which by the way, we're about to celebrate five years. Um," }, { "i": 50, "speaker": "Speaker 4", "text": "you know, the the Benji product now has uh it is now qualified as collateral on Kraken, so hedge funds can use it as collateral who are trading there. on Anduo. We announced a uh partnership" }, { "i": 51, "speaker": "Speaker 4", "text": "with Moon Pay today where you can swap from a um stable coins into the yieldbearing tokenized money market fund, the Benji fund, and then back out." }, { "i": 52, "speaker": "Speaker 4", "text": "So, to me, it's just the utility of being able to access a yieldbearing, you know, governmentbacked security uh money market fund uh in the crypto world. And there's a need for that. I mean, if" }, { "i": 53, "speaker": "Speaker 4", "text": "you're a hedge fund, you you want to earn whatever yield you can on the collateral that you have to post for your transactions." }, { "i": 54, "speaker": "Speaker 1", "text": ">> You know, I want to follow up on that because we are going to speak with Dell Dixon over at Stellar in in just a few minutes. You mentioned Benji. You launched that on Stellar 5 years ago. It" }, { "i": 55, "speaker": "Speaker 1", "text": "was the first US registered fund on a public blockchain. Nobody on Wall Street was paying attention. Now, it's nearly $2 billion in assets under management." }, { "i": 56, "speaker": "Speaker 1", "text": "We heard just heard from DTCC announcing it's putting tokenized Russell 1000 stocks, ETFs, and treasuries on Stellar 2. What was what was the foresight or or the luck in in in choosing Stellar in in" }, { "i": 57, "speaker": "Speaker 1", "text": "terms of like how they've committed since then or how they've performed rather since then and why you committed to them 5 years ago?" }, { "i": 58, "speaker": "Speaker 4", "text": ">> Yeah, first of all, it's been an well, first of all, it's I think we're at 2.6 billion in assets now on Benji. Um, Stellar, uh, it's been a great partnership. Part of it was the ability" }, { "i": 59, "speaker": "Speaker 4", "text": "to meet certain regulatory requirements of the SEC that the chain allowed us to do. Um, one of which was to, you know, if you had to adjust a transaction, you could actually do it. Uh, so that was" }, { "i": 60, "speaker": "Speaker 4", "text": "important. Uh, and really the foresight and it ended up being very fortunate because gas fees on Stellar are quite cheap versus some of the other chains and that's really important. Um but for" }, { "i": 61, "speaker": "Speaker 4", "text": "us the foresight was just the the the technology being able to uh you know the fact that you have a source of truth uh and and you don't have the delay in in in data. There's so much reconciliation" }, { "i": 62, "speaker": "Speaker 4", "text": "that goes on in financial services. And here with a blockchain we looked at we said wow we're going to be able to reduce all our costs if we can just have a single source of truth on a" }, { "i": 63, "speaker": "Speaker 4", "text": "transaction uh as well as the nature of a smart contract. So we started out and thinking okay money market funds a good place to start. We now have tokenized ETFs, traditional ETFs that are uh" }, { "i": 64, "speaker": "Speaker 4", "text": "listed on Krakens's exchange. So, you can get uh in your wallet uh the Franklin Teleton tokenized. We have, I think, six of them tokenized there." }, { "i": 65, "speaker": "Speaker 2", "text": "Adam, I want to just follow up and and get your thoughts here on DTCC announcing that it's putting uh tokenized Russell 1000 stocks, ETFs, and treasuries on Stellar, this uh public" }, { "i": 66, "speaker": "Speaker 2", "text": "blockchain. Is it at all frustrating to you that Wall Street's first major move onto um public blockchain infrastructure is happening on stellar and not something like Bitcoin's liquid network?" }, { "i": 67, "speaker": "Speaker 3", "text": ">> Well, I think that uh in practice they are flexible on technology. So, we'll see other chains being used um not tracking it closely, but I think that's already the case. So, you know, just" }, { "i": 68, "speaker": "Speaker 3", "text": "going back to the previous topic of the price action and Bitcoin standard treasury. So from one point of view, well usually Bitcoiners are interested in the price going up or Bitcoin stand" }, { "i": 69, "speaker": "Speaker 3", "text": "treasury uh it actually enables us to buy more Bitcoin once you know upon regulator approval." }, { "i": 70, "speaker": "Speaker 2", "text": ">> Okay, thank you for clarifying that." }, { "i": 71, "speaker": "Speaker 2", "text": "Really appreciate it. Jenny, um I want to get your take here on overall institutional demand and interest in crypto and how that's evolved since what we saw in October, which really felt" }, { "i": 72, "speaker": "Speaker 2", "text": "like a breaking point for Bitcoin. um it had gotten to record highs and since then it's been a struggle. Have you seen a noticeable a significant level of uh change in interest from institutional" }, { "i": 73, "speaker": "Speaker 4", "text": "investors?" }, { "i": 74, "speaker": "Speaker 4", "text": ">> So I have to be honest I don't necessarily follow Bitcoin as much there definitely as I already said once institutions have made a decision to be in the space and you see central banks" }, { "i": 75, "speaker": "Speaker 4", "text": "for a variety of reason also choosing to hold gold and bitcoin on their balance sheets. uh and so you know they don't they don't tend to uh react as quickly to price fluctuation once they've made" }, { "i": 76, "speaker": "Speaker 4", "text": "the investment decision. Uh I think what's been interesting about 2026 is I feel like it's a year where you're really seeing tradi and defi come together. For the first time we are" }, { "i": 77, "speaker": "Speaker 4", "text": "talking to multinational banks wirehouses that clients have come to them and said we want to hold our our crypto assets in our account here. Why should we have to have an account on a" }, { "i": 78, "speaker": "Speaker 4", "text": "crypto exchange? We'd like to see it all in one place. And so they're trying to talk about all right how do we set up this infrastructure add wallet capability? How do we do research on" }, { "i": 79, "speaker": "Speaker 4", "text": "these these coins? That conversation a year ago didn't happen. It is now happening in every major institution that we're talking to." }, { "i": 80, "speaker": "Speaker 1", "text": ">> Hey, Adam, I just want to finish with you and we can't, you know, chat with you and not mentioned Satoshi and this whole investigation from John Keroo at the New York Times a couple of months" }, { "i": 81, "speaker": "Speaker 1", "text": "ago. It has been a couple months since then. We did learn a few weeks ago that Carrie Rue has inked this $3 million book deal uh to write about the investigation into what he says is" }, { "i": 82, "speaker": "Speaker 1", "text": "unmasking you as Satoshi Nakamoto, the creator of of Bitcoin. I'm wondering just in the last couple of months if if if you've sufficiently in your view been able, you know, you've denied it, you've" }, { "i": 83, "speaker": "Speaker 1", "text": "denied it to us several times. If you've been able to sufficiently sort of shake that or if it's following you around right now wherever you go." }, { "i": 84, "speaker": "Speaker 3", "text": ">> Uh well, it it wasn't the first time. So there was the HBO documentary Money Electric. uh previous year and you know there's ongoing interest in the kind of you know genesis mystery from Bitcoin of" }, { "i": 85, "speaker": "Speaker 3", "text": "who who the uh originator was and so it's very hard to prove a negative is is the fundamental problem so you know beyond assuring people it's not now of course in the absence of information" }, { "i": 86, "speaker": "Speaker 3", "text": "people are you know going to write their own story and there are you know various people who are active pre- Bitcoin or develop technology that Bitcoin uses or talking about how to design something" }, { "i": 87, "speaker": "Speaker 3", "text": "like Bitcoin before, which is true for myself." }, { "i": 88, "speaker": "Speaker 3", "text": "And so people are just looking in their in their, you know, sort of investigation or speculation as to who was involved and then sort of making a list of the pros and cons, right? And I" }, { "i": 89, "speaker": "Speaker 3", "text": "I think as it is, you can you can do that for, you know, dozens of people approximately equally plausibly. So it's it's all sort of inconclusive in effect because the trail is very cold as" }, { "i": 90, "speaker": "Speaker 3", "text": "stopped. participating in the forums already in 2011, which is, you know, 15 years ago at this point." }, { "i": 91, "speaker": "Speaker 1", "text": ">> Well, we appreciate your time, Adam, and I especially appreciate you uh being such a good sport. When I every time we talk, I just badger you with questions about Satoshi and that investigation." }, { "i": 92, "speaker": "Speaker 1", "text": "Blockstream co-founder and CEO, Adam Bach. Also, uh Franklin Templeton CEO Jenny Johnson. Jenny, always good to check in with you, too. A big thank you to both of you for joining us relatively" }, { "i": 93, "speaker": "Speaker 1", "text": "late in the day from Paris. Well, it's time now for political exchange. The debate over the Clarity Act escalating to some heated rhetoric. Last week, Jaime Diamond appeared on TV and took" }, { "i": 94, "speaker": "Speaker 1", "text": "aim at Coinbase CEO Brian Armstrong for his efforts to influence lawmakers." }, { "i": 95, "speaker": "Speaker 1", "text": "Diamond said, quote, \"No one's going to bow down to this guy or this company." }, { "i": 96, "speaker": "Speaker 1", "text": "It's just him, by way. He's spending hundreds of millions of dollars in Washington on this thing.\" Armstrong claims to be advocating for the whole industry, but Diamond responded to that" }, { "i": 97, "speaker": "Speaker 1", "text": "assertation, that assertion rather, saying Armstrong is a more vulgar version of quote full of it. But then Galaxy Digital CEO Mike Novagrats chimed in on X, saying quote since when do" }, { "i": 98, "speaker": "Speaker 1", "text": "banks get to decide on legislation." }, { "i": 99, "speaker": "Speaker 1", "text": "It's time for Washington to do the right thing, they have heard all sides for 18 months. Armstrong, for his part, posted a parody poster with him and Diamond facing off on it. For more on this," }, { "i": 100, "speaker": "Speaker 1", "text": "we're joined by Bloomberg Intelligence senior government analyst Nathan Dean." }, { "i": 101, "speaker": "Speaker 1", "text": "Uh Nathan, I I tried to give an overview of what's happened over the last few days when it comes to this back and forth. But at issue is is what's been at issue between banks and and these crypto" }, { "i": 102, "speaker": "Speaker 1", "text": "companies for a long time and that has to do with yield, right? I mean, is that still the sticking point where these folks don't see eye to eye?" }, { "i": 103, "speaker": "Speaker 5", "text": ">> So, it's definitely the sticking point when it comes to banks versus crypto, but it's not the sticking point with Congress. And what I mean here is is that currently stablecoin issuers are" }, { "i": 104, "speaker": "Speaker 5", "text": "prevented from paying yield, but nothing prevents them from using platforms like Coinbase to offer rewards. Now, the deal that's the Senate has struck essentially will allow transactions, market making," }, { "i": 105, "speaker": "Speaker 5", "text": "and use of product and service to offer yield, but the banks don't like that because it still offers it, you know, as an option and it's very vague in terms of what actually that means. So, but" }, { "i": 106, "speaker": "Speaker 5", "text": "that deal is stuck. I mean, I don't think the Senate's going to change that." }, { "i": 107, "speaker": "Speaker 5", "text": "So now where the debate is going is over ethics and the strength of bank secrecy act anti-moneylaundering and that's going to the floor of the Senate. Long story short is I still think this" }, { "i": 108, "speaker": "Speaker 5", "text": "passes. I'm at a 70% chance but we could see some hiccups in the next few weeks as they debate debate this and go even further." }, { "i": 109, "speaker": "Speaker 2", "text": ">> All right, thank you for that summary on where things stand right now. Um especially after the Senate Banking Committee had cleared and advanced the Clarity Act earlier in the month. Uh you" }, { "i": 110, "speaker": "Speaker 2", "text": "are keeping tabs of course on the packs and the lobbying groups that each side has deployed at this point Nathan. Which side has more firepower? Is it the crypto side? Is it Tradfi or did you" }, { "i": 111, "speaker": "Speaker 2", "text": "know their money kind of cancel each other out?" }, { "i": 112, "speaker": "Speaker 5", "text": ">> So you know the money cancels each other out if the groups are willing to spend the money and crypto is the one that's willing to spend the money. I mean, obviously, we've seen a lot of data just" }, { "i": 113, "speaker": "Speaker 5", "text": "going back and forth in terms of what the crypto lobbying over the last 5 years has really spent here. And that's where I think a lot of this is going." }, { "i": 114, "speaker": "Speaker 5", "text": "And one of the reasons why I think this bill will ultimately passes is because the crypto sector is very very very uh strong in terms of just getting into those House committees, specifically the" }, { "i": 115, "speaker": "Speaker 5", "text": "House Agricultural Committee for example, and giving that type of money to both Republicans and Democrats. And they're very active in the primary season. And at the end of the day, when" }, { "i": 116, "speaker": "Speaker 5", "text": "you have to choose between crypto and banks, you know, the lawmakers are saying, \"Look, I love you both. I don't want to choose between you.\" So, they choose the avenue that gets them the" }, { "i": 117, "speaker": "Speaker 5", "text": "bill across the line. And that's where I think a lot of both traditional finance and crypto want to go in the long run." }, { "i": 118, "speaker": "Speaker 2", "text": ">> All right, good stuff, Nathan. Thank you as always, Nathan Dean with Bloomberg Intelligence. He tracks policy for us in Washington. Now, coming up, >> Galaxy Digital shares down today. The" }, { "i": 119, "speaker": "Speaker 1", "text": "broader market as it sets up a prediction market desk for institutional investors. shares down about 3.3%. We're going to dive into that next. This is Bloomberg." }, { "i": 120, "speaker": "Speaker 6", "text": "I'm Denita. Let's take a look at your midday movers. First up, a rally that drove stocks up to all-time highs is starting to waver. Wall Street is weighing the prospects for an agreement" }, { "i": 121, "speaker": "Speaker 6", "text": "that would end the war roing robber markets. the S&P 500 fluctuating after an 8day winning streak while US crude hovering around $92. Also, Bitcoin dipping below 68,000 for the first time" }, { "i": 122, "speaker": "Speaker 6", "text": "in 2 months amid concerns about Iran and selling by major holder strategy. Also, Julie Bard is soaring as much as 25%, the most ever after forecasting annual revenue growth of about 31%. and Marvel" }, { "i": 123, "speaker": "Speaker 6", "text": "jumped as much as 27% after Jensen Wang predicted it could become the next $1 trillion company. Those were your midday movers. And we need to take a look." }, { "i": 124, "speaker": "Speaker 1", "text": ">> Dallas Digital has launched a trading desk to offer large investors access to prediction markets via over-the-counter derivatives. Let's discuss with Bloomberg's Bernard Goder. Bernard, good" }, { "i": 125, "speaker": "Speaker 1", "text": "to have you on the program. Okay, you got to break this down for us. you you cover a very very complicated stuff. So So what does the creation of an OTC swaps desk actually mean for" }, { "i": 126, "speaker": "Speaker 1", "text": "institutional investors who want to trade prediction markets?" }, { "i": 127, "speaker": "Speaker 7", "text": ">> So the key problem at the moment with prediction markets is that they're actually quite thin outside of the world of sports. Um there aren't huge volumes on these markets." }, { "i": 128, "speaker": "Speaker 1", "text": ">> Everyone needs to remember that. Okay?" }, { "i": 129, "speaker": "Speaker 1", "text": "Because these you know the prediction markets say over and over again you know this is like everyone can bet on the you know you can hedge against the weather if you're a farmer. Except people" }, { "i": 130, "speaker": "Speaker 1", "text": "aren't. No, they're betting on, you know, the Knicks and Spurs." }, { "i": 131, "speaker": "Speaker 7", "text": ">> Exactly. Which is which is great. Um, but for institutions, for hedge funds, that's not really what they want to be doing. So, the beauty of a a swaps desk is you can just go to a single" }, { "i": 132, "speaker": "Speaker 7", "text": "counterparty and say, I want to do, in this case, it was $10 million bet on whether or not the Clarity Act would pass. Um, and that's important for this crypto fund, which is long long crypto" }, { "i": 133, "speaker": "Speaker 7", "text": "effectively. So, they went into a transaction where they they would get it's almost like an insurance contract against a political event uh going the wrong way. Um, and the reason that it's" }, { "i": 134, "speaker": "Speaker 7", "text": "important that they did it over the counter is that they they wanted discretion. They wanted execution certainty. Um, and you can do that with the swap dealer like like G Galaxy Digital." }, { "i": 135, "speaker": "Speaker 2", "text": ">> Okay. So, this just kind of greases the wheel a little bit for these transactions to happen more seamlessly." }, { "i": 136, "speaker": "Speaker 2", "text": "Do you think overall when you look at prediction markets and where things are headed that they're going to go on a similar journey to the one that crypto's been on, which is retail traders kind of" }, { "i": 137, "speaker": "Speaker 7", "text": "led the way and institutional investors followed along a few steps behind? Yeah, definitely this is an area that's been really pushed by the retail investors." }, { "i": 138, "speaker": "Speaker 7", "text": "But one important thing to remember about the prediction markets and what maybe differentiates them from other other journeys that things like crypto have been on is that in market makers" }, { "i": 139, "speaker": "Speaker 7", "text": "like Susuana have been there right from the start with this. So so really it's been kind of built from the ground up and almost every trade you do is going to be with a market maker. So in that" }, { "i": 140, "speaker": "Speaker 7", "text": "sense these these there's a similarity with the traditional kind of financial system that doesn't necessarily exist in crypto." }, { "i": 141, "speaker": "Speaker 1", "text": ">> So where where does this leave the the upstarts the poly markets and the kshi if increasingly we're seeing institutional adoption or other prediction markets launch on different" }, { "i": 142, "speaker": "Speaker 7", "text": "platforms." }, { "i": 143, "speaker": "Speaker 7", "text": ">> It's actually good news for them I would say. Um I think they would be very keen for for banks for institutional investors to be doing stuff over the counter because those people then need" }, { "i": 144, "speaker": "Speaker 7", "text": "to hedge their risk. And where do they do that? They can do that on Poly Market. They can do that on Koshi. And it should spur more volumes. So if you're if if you're one of these platforms, you're not too worried about" }, { "i": 145, "speaker": "Speaker 7", "text": "people doing this stuff over the counter because ultimately the price discovery is still going to be happening on these exchanges." }, { "i": 146, "speaker": "Speaker 2", "text": ">> So it's kind of a rising tide lifts all boats." }, { "i": 147, "speaker": "Speaker 2", "text": ">> Exactly." }, { "i": 148, "speaker": "Speaker 2", "text": ">> All right. Thank you so much, Bernard Goer. Uh covering all kinds of complicated things in the world of digital finance. Really appreciate you joining us today." }, { "i": 149, "speaker": "Speaker 2", "text": ">> All right. Coming up next on Bloomberg Crypto, the DTCC is connecting its new tokenized securities platform with the Stellar network. So Danell Dixon, CEO of the Stellar Development Foundation, will" }, { "i": 150, "speaker": "Speaker 2", "text": "tell us more in our token moment. That's coming up next. This is Bloomberg Crypto Welcome back to Bloomberg Crypto. I'm Scarlett Fu alongside Tim Stenc. It is time for a token moment. Wall Street's" }, { "i": 151, "speaker": "Speaker 2", "text": "clearing house, the DTCC, is connecting its tokenized securities platform to the Stellar network. Tokenized assets held by the depository trust could become available on Stellar during the first" }, { "i": 152, "speaker": "Speaker 2", "text": "half of 2027. This move expands Wall Street's effort to move traditional financial assets on chain. So to discuss, we're pleased to welcome Denell Dixon. She's CEO of Stellar Development" }, { "i": 153, "speaker": "Speaker 2", "text": "Foundation. Dell, great to speak with you. Thank you for joining us today. um talk a little bit about how this partnership came about, who approached who." }, { "i": 154, "speaker": "Speaker 8", "text": ">> Well, thank you. It's such a pleasure to be here again. Uh you know, we've been working with folks at that now at DTPC for many many years. So the secury was an organization that um that was" }, { "i": 155, "speaker": "Speaker 8", "text": "acquired by DTT DT3 and we secury had been in our ecosystem since probably 2018 and so they had actually helped to build the clawback functionality, the freeze functionality, all of these" }, { "i": 156, "speaker": "Speaker 8", "text": "components that are really important for from a compliance standpoint. So we've known the team for a long time and when they got to the place that they were actually thinking about this, we had" }, { "i": 157, "speaker": "Speaker 1", "text": "been in conversation and so it was just a very uh easy outcome from there. Uh this is a huge validation for a public blockchain can get from from Tradfi." }, { "i": 158, "speaker": "Speaker 1", "text": "We're talking $14 trillion in assets on Stellar as the first public chain for tokenized Russell 1000 stocks, ETFs and and US. I'm wondering though, and we can we're talking about the plumbing here," }, { "i": 159, "speaker": "Speaker 1", "text": "so we're getting a little like, you know, a little detailed. Um is Stellar the actual settlement layer or is it like a display window for assets that still live at DTCC? What can you tell us" }, { "i": 160, "speaker": "Speaker 8", "text": "about that? Well, the native issuance is a really important component of it. So, using this for their books and records is a is a really important piece of it." }, { "i": 161, "speaker": "Speaker 8", "text": "So, very similar. I know that you had uh Jenny Johnson on earlier really thinking through how you can use this tech stack for its benefit. Uh and the benefit is you can use it for books and records and" }, { "i": 162, "speaker": "Speaker 8", "text": "then you can build products on top of it like money market funds like any of the assets that are going to be issued from u using the DTCC tokenization platform." }, { "i": 163, "speaker": "Speaker 2", "text": "And our understanding, as we mentioned earlier, is that your integration will not be completed until the first half of 2027. So you still have a year to go." }, { "i": 164, "speaker": "Speaker 2", "text": "Canton, which is a permission chain, is already inside DTCC's architecture. So I guess one could question why should Wall Street wait for Stellar when a permissioned alternative is already" }, { "i": 165, "speaker": "Speaker 8", "text": "live." }, { "i": 166, "speaker": "Speaker 8", "text": ">> Oh, well, it's not live yet, but yes, I see you're saying it's going to be live on testnet. I think it's really important for uh open public blockchains to be the the alternative that is" }, { "i": 167, "speaker": "Speaker 8", "text": "chosen. When you think about what happens with an open public blockchain is that there are people all over the world just like the folks at security who were building the technology and" }, { "i": 168, "speaker": "Speaker 8", "text": "bringing ideas and making it better constantly. That's one component of it." }, { "i": 169, "speaker": "Speaker 8", "text": "The fact that the validators that anyone can come to validate on the network and you have to define who you are so that people can trust you. That's another component. working in the open is always" }, { "i": 170, "speaker": "Speaker 8", "text": "beneficial when it comes to financial technology. If we don't have open public networks that are actually chosen to do this, we're going to end up with closed financial infrastructure just like we" }, { "i": 171, "speaker": "Speaker 8", "text": "have right now. That's not going to change, that's not going to grow, that's not going to benefit from all of the collaboration globally. So I think that what we're seeing is it's a step change" }, { "i": 172, "speaker": "Speaker 8", "text": "when you think about they they are choosing to move to open which I think is a really really important piece of it and that's something that we think is important." }, { "i": 173, "speaker": "Speaker 1", "text": ">> Well to to to follow on that does does the public versus permission distinction actually matter to an institutional investor who just wants faster settlement?" }, { "i": 174, "speaker": "Speaker 8", "text": ">> Well I think it should matter because of distribution because you have distribution globally on an open public network. You also have others that can." }, { "i": 175, "speaker": "Speaker 8", "text": "So much of what these asset issuers are looking for is the ability to distribute to different parts of the world to use their tools to use their products and collateral to be able to think about all" }, { "i": 176, "speaker": "Speaker 8", "text": "of the different components that they can build upon. They have these assets already in traditional finance right now, but to be able to leverage the the speed, the transparency, and the" }, { "i": 177, "speaker": "Speaker 8", "text": "openness of a blockchain to be able to do that. Yes, open public infrastructure is the better outcome." }, { "i": 178, "speaker": "Speaker 2", "text": ">> I think about the numbers involved here." }, { "i": 179, "speaker": "Speaker 2", "text": "the DTCC custody $114 trillion dollars in assets on Stellar. I mean that that's just massive. Um talk a little bit about the real world assets on Stellar and what that growth trajectory has looked" }, { "i": 180, "speaker": "Speaker 8", "text": "like and how you see it developing." }, { "i": 181, "speaker": "Speaker 8", "text": ">> Oh, it's been pretty remarkable. I mean, I just love the fact that we get regulatory clarity and then regulatory clarity opens up markets. In the end in December of 2025, we hit a billion in" }, { "i": 182, "speaker": "Speaker 8", "text": "real world assets on Stellar. in just yesterday, June 1st, we're up to three billion. So, think about that growth, 3x in just the last few months. That's an important indication of where this" }, { "i": 183, "speaker": "Speaker 8", "text": "industry is headed. And tokenizing just to tokenize is not beneficial. You tokenize because it it it is best for the fund because it brings the cost down for the fund, which ultimately benefits" }, { "i": 184, "speaker": "Speaker 8", "text": "the retail users ormemes on the edge or the institutions that are actually holding that fund. And then it is that ease of settlement and that ability to constantly do new things. When you think" }, { "i": 185, "speaker": "Speaker 8", "text": "about what happened with respect to uh Franklin Templeton and what they've done with their money market fund on Stellar, they're now able to pay you interest for every minute that you're in the fund." }, { "i": 186, "speaker": "Speaker 8", "text": "That is something that could happen only with this kind of technology. So when I see the the real world assets already increase 3x in just the last four months, it's a pretty remarkable shift." }, { "i": 187, "speaker": "Speaker 1", "text": ">> You know, I want to go back to Scarlet's question that that she opened with about the partnership coming together. If if we think about the acquisition of securrency, DTCC acquired that back in" }, { "i": 188, "speaker": "Speaker 1", "text": "2023. Uh CoinDesk said the roots of this partnership go back there. How much of of what happened what what happens now is a result of of technology versus sort of having having been in the room longer" }, { "i": 189, "speaker": "Speaker 8", "text": "than anyone else." }, { "i": 190, "speaker": "Speaker 8", "text": ">> Well, I think it's both. I think relationships are really important part of building something together. But quite honestly, I think that technology is where it starts. The fact that the" }, { "i": 191, "speaker": "Speaker 8", "text": "tech stack could actually it's the compliance layer is built into the tech tech stack. You don't need to bolt on a smart contract to be able to do it. You have everything built in and then you" }, { "i": 192, "speaker": "Speaker 8", "text": "get to program that as the asset issuer." }, { "i": 193, "speaker": "Speaker 8", "text": "It's the same for privacy and how we think about privacy. It's built into the tech stack at the base layer. You then program on top how much you need. That's a really important piece. It was built" }, { "i": 194, "speaker": "Speaker 8", "text": "for financial institutions even when financial institutions weren't yet here and now they're here and they recognize the value of this tech stack being s simple for them but also offering them" }, { "i": 195, "speaker": "Speaker 8", "text": "that everything that all the regulatory environment needs them to have." }, { "i": 196, "speaker": "Speaker 2", "text": ">> All right, Denell, thank you so much." }, { "i": 197, "speaker": "Speaker 2", "text": "Dell Dixon is CEO of the Stellar Development Foundation. Really appreciate you're joining us today to talk more about what you're doing uh with the DTCC. We have some news uh some headlines coming out right now from uh a" }, { "i": 198, "speaker": "Speaker 2", "text": "conversation with Goldman Sachs's CEO David Solomon. He's speaking at the Economic Club of New York and he's talking about how there's more greed than fear in markets right now. This of" }, { "i": 199, "speaker": "Speaker 2", "text": "course as the S&P 500 extends its gain to a ninth straight day trading at a record high. He also says cyber risk is getting a lot of attention from corporates and uh he mentions that" }, { "i": 200, "speaker": "Speaker 2", "text": "Alphabet stock is trading well after the announcement that it raised uh a lot a tremendous amount of money in capital 80 billion which kind of took everyone by surprise." }, { "i": 201, "speaker": "Speaker 1", "text": ">> Yeah, we're going to be talking about that a little later on Bloomberg Business Week Daily. In the meantime, there's also um some headlines about New York City. Uh he says that uh Mayor Mom" }, { "i": 202, "speaker": "Speaker 1", "text": "Donnie he'd like to hear Mayor Mom Donnie talk more about business and needs to accelerate permitting to actually build more in uh New York City." }, { "i": 203, "speaker": "Speaker 2", "text": ">> All right, we'll keep you posted on any further headlines here from Goldwin Saxio David Solomon." }, { "i": 204, "speaker": "Speaker 1", "text": ">> Coming up next, we're talking payments tech. The Fireblock CEO is joining us from the Money 2020 conference that's in Amsterdam. This is Bloomberg." }, { "i": 205, "speaker": "Speaker 6", "text": "We're halfway through the trading session in New York. I'm Benito Teula." }, { "i": 206, "speaker": "Speaker 6", "text": "Let's take a look at your midday movers." }, { "i": 207, "speaker": "Speaker 6", "text": "First up, a rally that drove stocks to all-time highs is wavering as Wall Street weighs prospects for an agreement that would end the war roing markets." }, { "i": 208, "speaker": "Speaker 6", "text": "The S&P 500 is fluctuating after an 8-day winning streak. US crude is hovering uh around $93. Hip card shares are soaring after its annual outlook topped Wall Street estimates. The" }, { "i": 209, "speaker": "Speaker 6", "text": "company cited massive growth in AI fuel demand for servers and networking and said revenue will rise in fiscal year ending in October. Meanwhile, Victoria Secret shares are surging after the" }, { "i": 210, "speaker": "Speaker 6", "text": "company beat earnings estimate and boosted its outlook. And shares of strategy falling. It saw about 2.5 million of Bitcoin, its first sale since 2022, a symbolic break for the playbook" }, { "i": 211, "speaker": "Speaker 6", "text": "that helped the company become one of the biggest holders. Those are your midday movers. I'm Denita Teova." }, { "i": 212, "speaker": "Speaker 2", "text": "Let's shift our focus now to money rewired. The increasing overlap between crypto and traditional finance. A new challenger to banks is emerging on the payments front and it's powered by one" }, { "i": 213, "speaker": "Speaker 2", "text": "of America's biggest retailers, Walmart." }, { "i": 214, "speaker": "Speaker 2", "text": "One Pay, which is a financial technology service backed by Walmart, now has 6 million monthly active users and $50 billion in annualized payments. That is double the figures from the previous" }, { "i": 215, "speaker": "Speaker 2", "text": "year. Bloomberg fintech reporter Paige Smith has been writing about this and she joins us now. So, how is Walmart employing One Pay and you know what what do users get from it?" }, { "i": 216, "speaker": "Speaker 9", "text": ">> So, just to be clear, OnePay is a financial technology company, a fintech that is backed by Walmart, but also by Ribbit Capital, which is one of the country's foremost venture capital" }, { "i": 217, "speaker": "Speaker 9", "text": "firms. And to be very clear, it's a completely independent company. Okay?" }, { "i": 218, "speaker": "Speaker 9", "text": "But it is certainly benefits from these really loyal customers that shop at Walmart and shop online at Walmart. And basically the goal for this fintech is to become a consumer fintech super app." }, { "i": 219, "speaker": "Speaker 1", "text": ">> Like a super app in what in what sense?" }, { "i": 220, "speaker": "Speaker 1", "text": "Like a super app like consumers in China have known for 20 years when it really so like doing everything from ordering food to your banking in one single app." }, { "i": 221, "speaker": "Speaker 1", "text": "what metal, you know, Facebook and David Marcus tried to do this a million years ago. It didn't work out." }, { "i": 222, "speaker": "Speaker 9", "text": ">> So, it certainly does. I would say that there is an uphill battle there to be that to be America's super app for sure." }, { "i": 223, "speaker": "Speaker 9", "text": "And I think that there are also a number of companies that, as you said, have tried or are actively trying to do that." }, { "i": 224, "speaker": "Speaker 9", "text": "You know, Robin Hood comes to mind um as being kind of an entity that really wants to capture as much of your wallet and your spend and your banking as possible, but that's also what One Pay" }, { "i": 225, "speaker": "Speaker 9", "text": "wants to do. And I would say they do have this benefit of just these customers that are kind of ready for uh they're very loyal. They love shopping at Walmart and um you know it's sort of" }, { "i": 226, "speaker": "Speaker 9", "text": "well known that the biggest US banks in this country maybe don't you know are are are very well known for catering for to wealthier individuals >> and not necessarily to some underserved" }, { "i": 227, "speaker": "Speaker 2", "text": "customers. So just to be clear it's not that Walmart owns this. Walmart backs the service, but um One Pay has access to Walmart's customers or do Walmart customers have to opt in? How does that" }, { "i": 228, "speaker": "Speaker 9", "text": "work?" }, { "i": 229, "speaker": "Speaker 9", "text": ">> So, you would sort of like any sort of fintech app. You download it and you um you have the option to create a bank account. That bank account won't necessarily be housed at One Pay because" }, { "i": 230, "speaker": "Speaker 9", "text": "One Pay is not a bank itself, but they'll work with their banking partners to essential essentially offer their banking services. They also have a debit card that you could sign up for. They" }, { "i": 231, "speaker": "Speaker 9", "text": "have um they have a trading platform available. All sorts of services. Buy now pay later." }, { "i": 232, "speaker": "Speaker 1", "text": ">> Still no Apple Pay at Walmart, by the way." }, { "i": 233, "speaker": "Speaker 2", "text": ">> Still no Apple. Still no Apple Pay. All right, Paige, thank you so much. Paige Smith is our fintech reporter here at Bloomberg News. Let's stay with fintech and payments and turn now to the money" }, { "i": 234, "speaker": "Speaker 2", "text": "2020 conference in Amsterdam. Fireblock CEO Michael Shalov is there and his company is developing stablecoin payment infrastructure and they just announced a new product today. Michael, tell us" }, { "i": 235, "speaker": "Speaker 10", "text": "about the new product." }, { "i": 236, "speaker": "Speaker 10", "text": ">> Yeah, of course. Thanks for having me." }, { "i": 237, "speaker": "Speaker 10", "text": "Uh, so we launched today uh Firebox Flow. It allows payment companies and merchants and FinTech to actually accept stable coins and to send stable coins in a very simple way. It's a solution that" }, { "i": 238, "speaker": "Speaker 10", "text": "is similar to what plaid did in the traditional world that streamlines the entire flow of how a wallet can send and money to a merchant or to a fintech." }, { "i": 239, "speaker": "Speaker 1", "text": ">> Where's the demand for this coming from?" }, { "i": 240, "speaker": "Speaker 1", "text": "Like where are you seeing where do you look out across the landscape and say this is a problem that needs solving?" }, { "i": 241, "speaker": "Speaker 10", "text": "Yeah. So, um, as you're probably aware, stable coin payments increased significantly over the last 18 months and specifically since the Genius Act passed, um, about a year ago. And we're" }, { "i": 242, "speaker": "Speaker 10", "text": "basically seeing stable coin volume um, skyrocketing. So, on our platform about 65% of the volume right now at around $3.5 trillion is stable coins, predominantly USDC and USDT. And we're" }, { "i": 243, "speaker": "Speaker 10", "text": "seeing uh payment service providers like Stripe, like Czecho.com, uh like uh World Pay and so on basically enabling merchants to start accepting stable coins. And we also seeing quite a" }, { "i": 244, "speaker": "Speaker 10", "text": "pretty significant demand building up across emerging markets and like LATAM, Southeast Asia and so on of population, sometimes bank, sometimes unbanked that is paying into those merchants." }, { "i": 245, "speaker": "Speaker 2", "text": ">> Okay. And that makes sense. the demand swelling up in emerging markets like Asia, like Latin America. If we're going to talk about stable uh stable coins really um hitting the mainstream, what" }, { "i": 246, "speaker": "Speaker 2", "text": "is the use case for people inside the US, for instance, to actually use stable coins? I mean, if I wanted to send money to Tim, I'd have so many options already. I can go through Zel, I can use" }, { "i": 247, "speaker": "Speaker 2", "text": "Venmo, I can just give him cash." }, { "i": 248, "speaker": "Speaker 2", "text": ">> You never send me money." }, { "i": 249, "speaker": "Speaker 2", "text": ">> I don't send him money yet, but I could." }, { "i": 250, "speaker": "Speaker 2", "text": "Um but stable coin is not necessarily an option I even need to consider." }, { "i": 251, "speaker": "Speaker 10", "text": ">> Yeah. So I would say that right now in the United States most of the adoption that we are seeing is twofold. First of all in the consumer market it's actually outbound right? So we're seeing a lot of" }, { "i": 252, "speaker": "Speaker 10", "text": "remittance and B2B for crossber money being sent from for from people in the United States to uh Latin America to Southeast Asia, right?" }, { "i": 253, "speaker": "Speaker 10", "text": "So those crossber corridors over there well you know you can't zel you can't venmo and to be honest like you know it will be pretty difficult for you to send cash right you need to take flight" }, { "i": 254, "speaker": "Speaker 10", "text": ">> and and like you know the traditional rails they've been fairly expensive now to be honest in the last uh quarter or so uh we brought online both Moneygram Western Union finance and a few other uh" }, { "i": 255, "speaker": "Speaker 10", "text": "larger meters that are switching to this rail. So this is like one area where we're seeing the demand uh building up and then the other is B2B right? So business to business >> that is actually an area that as you" }, { "i": 256, "speaker": "Speaker 10", "text": "probably on the personal side can experience you know that's not working that well and also like large payments right so we do think that even on the personal side there will be situations like rent over" }, { "i": 257, "speaker": "Speaker 10", "text": "the weekend and some of those use cases that actually you can't do it through zel or through uh Venmo because those are sometimes large amounts." }, { "i": 258, "speaker": "Speaker 1", "text": ">> Yeah. Well, well, let's talk about more about adoption because Euro stable coins are just $650 million right now of a $35 billion market. That's uh 99% dollar denominated. You announced this" }, { "i": 259, "speaker": "Speaker 1", "text": "consortium of 12 European banks that chose Fireblocks to power a micica compliant Euro stable coin that launches later this year. Does that move the needle when it comes to adoption in your" }, { "i": 260, "speaker": "Speaker 1", "text": "view? Like if we're speaking a year from now, is are we going to be at 95% dollar denominated? 90% are still at 99%." }, { "i": 261, "speaker": "Speaker 10", "text": ">> Yeah, I think that the jury is still out in terms of what will happen globally uh with um it's called like you know FX or non US dollars. I think Kales the consortium that uh we are providing a" }, { "i": 262, "speaker": "Speaker 10", "text": "technology for and it's a consortium of few dozens European banks. It is a very interesting attempt uh in the European Union to basically try and uh counter the dollarization that is happening" }, { "i": 263, "speaker": "Speaker 10", "text": "across those economies. We're seeing similar trends in Brazil with a few Brazilian real stable coins in Canada, in Japan. Now the reality is that most of the international or crossber" }, { "i": 264, "speaker": "Speaker 10", "text": "transfers right now around the globe are in dollars, right? So it kind of makes sense that if the main use case right now is crossborder, then we will have dollarization and then on top of it in" }, { "i": 265, "speaker": "Speaker 10", "text": "all those emerging markets, people using stable coins almost like a dollar account to protect them against inflation. So, >> right, >> I don't know if it's going to be 95. I do think that there are quite a few" }, { "i": 266, "speaker": "Speaker 10", "text": "interesting use cases for Euro denominated stable coins and Japanese yen denominated stable coins." }, { "i": 267, "speaker": "Speaker 2", "text": ">> All right, Michael, thank you so much for joining us today. Michael Shalov is the CEO of Fireblocks. Coming up next, the NBA finals is set to start tomorrow night. Knicks versus Spurs. So, with" }, { "i": 268, "speaker": "Speaker 2", "text": "that in mind, we're going to dive into prediction markets and how many users are actually walking away empty-handed from their bets. This is Bloomberg Crypto." }, { "i": 269, "speaker": "Speaker 1", "text": "Let's get to the odds. An in-depth look at the booming growth of prediction markets. According to an analysis by Citizens, traders on prediction markets fare worse than traditional sports" }, { "i": 270, "speaker": "Speaker 1", "text": "betterers on increasingly popular multileg wagers. Here to report on the story is Bloomberg's Ira Budwe. Ira, the multileg versus parlay, people might know parlay from a traditional uh" }, { "i": 271, "speaker": "Speaker 1", "text": "platform. What did the citizens report find when it comes to prediction markets versus the traditional players?" }, { "i": 272, "speaker": "Speaker 11", "text": ">> They found that on these parlay style, the prediction markets called them combos. combination trades um where you have a series of linked outcomes. The who's going to win, what the final total" }, { "i": 273, "speaker": "Speaker 11", "text": "points might be, how an individual player is going to perform, and they all have to hit for you to win the bet. On the traditional sports books, from October of last year to the end of May," }, { "i": 274, "speaker": "Speaker 11", "text": "you typically saw uh 12% losses, right?" }, { "i": 275, "speaker": "Speaker 11", "text": "For a median user, if you had a $100 wallet, you lost $12 over that period on parlays. on prediction markets doing combos, same period, losses were 18%. So if you had a $100 wallet, you lost 18" }, { "i": 276, "speaker": "Speaker 11", "text": "bucks. So there in this study, in this cohort, they're fairing worse on prediction markets than they are on traditional sports betting apps." }, { "i": 277, "speaker": "Speaker 2", "text": ">> Yeah. And to be clear, both of those options show negative returns. So people are not making money. They might be having a lot of fun going about it, though. Ira, how are combination trades" }, { "i": 278, "speaker": "Speaker 11", "text": "um on prediction markets different than the parlays on those through those traditional platforms? The main difference is that on a parlay, like with any bet, on a sports betting app," }, { "i": 279, "speaker": "Speaker 11", "text": "the the house is taking the other side of the bet. They're setting the odds and they are taking the other side of the wager. On prediction markets, they are matching up peers. And so the way" }, { "i": 280, "speaker": "Speaker 11", "text": "they've managed to introduce parlay style trades or combos is by a request for quote process where you put in the four legs you want and then somebody else on the other side instantly prices" }, { "i": 281, "speaker": "Speaker 11", "text": "that out and offers you uh a wage or offers you a price on that. And so in order to do this RFQ, anybody on the platform theoretically can do it, but you really need some ability to price" }, { "i": 282, "speaker": "Speaker 11", "text": "instantly, ability to pay out if you do lose and somebody hits big and uh an ability to have the right software set up. Right? So it's not a thing that typical retail traders are doing. It" }, { "i": 283, "speaker": "Speaker 11", "text": "tends to be institutional users and market makers who are off who are taking the other side of these combo trades." }, { "i": 284, "speaker": "Speaker 11", "text": "Which is why according to the citizens analysis you are seeing um you know poor economics for the typical retail user because on the other side of these combo trade/parlays are often Wall Street" }, { "i": 285, "speaker": "Speaker 11", "text": "firms trading firms very sophisticated actors on the platforms who are capable of doing these RFQS instantly and and offering a price." }, { "i": 286, "speaker": "Speaker 1", "text": ">> We should note that a spokesperson for Poly Market declined to comment on this report. A call she spokesperson Elizabeth Diana said that the new analysis scarlet is quote misleading and" }, { "i": 287, "speaker": "Speaker 2", "text": "inaccurate." }, { "i": 288, "speaker": "Speaker 2", "text": ">> All right. Well, Ira Budwway, thank you so much for your reporting. Uh you can check out Ira's reporting on the Bloomberg terminal and at bloomberg.com." }, { "i": 289, "speaker": "Speaker 2", "text": "Prediction market betters lagging sports gamblers according to this latest analysis from citizens." }, { "i": 290, "speaker": "Speaker 1", "text": ">> What do the prediction market say about the the NBA finals?" }, { "i": 291, "speaker": "Speaker 2", "text": ">> I don't know. I haven't checked it yet." }, { "i": 292, "speaker": "Speaker 2", "text": ">> Yeah, I have to check that. But, you know, >> and I almost don't want to see because like if you believe, you believe." }, { "i": 293, "speaker": "Speaker 1", "text": ">> Hey, and New Yorkers, we believe." }, { "i": 294, "speaker": "Speaker 2", "text": "That does it for Bloomour Crypto. Be sure to join us next week." } ]