[ { "speaker": "Speaker 1", "text": "Who are you? I'm Henry McVey. I'm co-founder and CEO of of Stream X. So, Stream X is a one public company. We issue tokenized commodities. Explain to my mom why we need these tokenized" }, { "speaker": "Speaker 1", "text": "commodities. If you wanted to go buy gold, it would cost you money. So, whether you would be buying the physical gold and then you need to store it somewhere, that will cost you money. If" }, { "speaker": "Speaker 1", "text": "you buy our product, which is GLDY, you can get the same exposure to gold. And so, you can see gold when it goes up or down, you have the same exposure. But, you also get paid uh 3 and 1/2% [music]" }, { "speaker": "Speaker 1", "text": "annual yield for holding the gold. And so, that's paid in additional gold every single month. And so, if you want to own gold or if you want to own any other commodity, tokenization allows us to do" }, { "speaker": "Speaker 1", "text": "these things and it gives us the ability to create these assets that are backed by real assets while giving a yield on top of it. I think one thing that's definitely important is Stream X as a" }, { "speaker": "Speaker 1", "text": "firm, we are creating the future of commodities and then bringing commodities really into this this new world of of finance and and operating within an industry that is poised to grow absolutely massively while" }, { "speaker": "Speaker 2", "text": "targeting an industry that has one of the largest TAM in the world. Hey everyone, welcome to Drops, a podcast series where we showcase rising projects and founders that are not yet mainstream" }, { "speaker": "Speaker 2", "text": "but have a huge potential in the crypto space. Since When Shift Happens started to take off, we received hundreds of requests from incredible teams every month that we had to turn down. Not" }, { "speaker": "Speaker 2", "text": "because they weren't good enough, but because they weren't yet the right fit in terms of scale and visibility. And this is changing now. With the Drops series, we're building on the" }, { "speaker": "Speaker 2", "text": "credibility of When Shift Happens to give a voice to the next generation of builders shaping the future of crypto." }, { "speaker": "Speaker 2", "text": "Drops isn't a research service or an endorsement. It's a platform to spotlight the potential breakout founders of tomorrow." }, { "speaker": "Speaker 2", "text": "If you had to describe what it is you do and why you do it to your Uber driver, [music] I'm guessing you came by Uber here. We did. Yeah." }, { "speaker": "Speaker 1", "text": "What would you say?" }, { "speaker": "Speaker 1", "text": "For Streamax in general, we take real things, like gold, silver, copper, and turn them into tradeable assets that you can trade all around the world." }, { "speaker": "Speaker 1", "text": "And so, tokenization itself is our main focus really as a as a company. And so, our our focus being tokenization of commodities." }, { "speaker": "Speaker 1", "text": "And everyone knows gold itself is a one of the most valuable assets in the world. And how do you turn that into something that can one give you yield?" }, { "speaker": "Speaker 1", "text": "And so, with our product like GLDY, it gives a yield, it pays out a 3 and 1/2% yearly dividend." }, { "speaker": "Speaker 1", "text": "And from there it you have the ability to get the exposure to the asset while also getting additional gold on top of that. And so, I think when we think about Streamax as a as a company," }, { "speaker": "Speaker 1", "text": "it's really bringing an industry that is very old and sort of set in its ways and does things a certain way, which is commodities and gold and silver and those assets, and then bring that into" }, { "speaker": "Speaker 1", "text": "the new age, which is tokenization and and digitization of assets to make them more efficient and give access to people to be able to participate in those in those industries." }, { "speaker": "Speaker 1", "text": "Who are you?" }, { "speaker": "Speaker 1", "text": "I'm Henry McFee. I'm co-founder and CEO of of Streamax." }, { "speaker": "Speaker 2", "text": "Tell us or tell me something about you and your life that can help people trust more what you'll share with us today." }, { "speaker": "Speaker 1", "text": "It's a good question. Um one, I'm a mining engineer." }, { "speaker": "Speaker 1", "text": "And so, I understand the the commodity space and the mining space I think pretty well. Um been working at mine since I was 18 years old all across northern BC. On top of that, I've been a founder" }, { "speaker": "Speaker 1", "text": ">> what does just what does mining engineering mean concretely? Mining engineering at its simplest is how to get things out of the ground efficiently." }, { "speaker": "Speaker 1", "text": "How to dig the holes, how to blow stuff up, whatever that whatever that might be. And so gold, silver, copper, everything what's in this mic, what's in your computer, those all need" }, { "speaker": "Speaker 2", "text": "to come from somewhere. There is studies about mining engineering. Yes." }, { "speaker": "Speaker 1", "text": "Specifically. Mhm. And so How did you get into that?" }, { "speaker": "Speaker 1", "text": "My family. And so my dad, my grandpa, they were all involved in the in the mining space. And so they sort of from a young age I saw what it was like and had opportunities to work in that industry" }, { "speaker": "Speaker 1", "text": "and thought it was really cool. And so ended up pursuing that in in college and from there I was doing crypto stuff sort of at the same time and really sort of shifted into that space. But" }, { "speaker": "Speaker 1", "text": "yeah, it's been a it's been a good thing to have and have that sort of like professional understanding on on what things need to be able to be created." }, { "speaker": "Speaker 2", "text": "You're 26 years old." }, { "speaker": "Speaker 2", "text": "Co-founder of a company listed on the Nasdaq." }, { "speaker": "Speaker 1", "text": "Mhm. How is that possible?" }, { "speaker": "Speaker 1", "text": "I mean, having a really good team behind you. And like having a really good team of of people that are able to to be there to provide that advice and and the you know, drive things forward. And I think especially" }, { "speaker": "Speaker 1", "text": "right now, the the opportunity for people to build things and go public and raise money age really isn't a factor anymore. And I and I think you know, from the experience that I've" }, { "speaker": "Speaker 1", "text": "had founding projects, I founded my first project when I was 19." }, { "speaker": "Speaker 1", "text": "Um it was an NFT project and it was a lot more successful than I thought it was going to be. You know, when we launched we were the third largest project in the world. We sold out. It" }, { "speaker": "Speaker 1", "text": "was crazy. 100,000 people in the in the community. And then from there did a bunch of other stuff as well. But I think it's by doing things at a young age and having opportunity to do things when" }, { "speaker": "Speaker 1", "text": "you're younger than build into the the industry, I think you know, you don't need to be 50 years old anymore to be able to to start something and and be the the founder or or CEO." }, { "speaker": "Speaker 2", "text": "How do you go from launching an NFT project, which is more on the degenerate side, to running a public company in your mid-20s, which is the exact opposite of degeneracy from NFT and crypto? Yeah. Now, it's it's a" }, { "speaker": "Speaker 1", "text": "it's a really good question." }, { "speaker": "Speaker 1", "text": ">> So, the path itself was we launched the NFT project in 2020." }, { "speaker": "Speaker 1", "text": "Um from there, we ran that for a couple of years. We I ended up starting a software development company doing early-stage tokenization stuff, primarily on like Ethereum and Solana ecosystems." }, { "speaker": "Speaker 1", "text": "I met my co-founder, his name is Morgan Lextrum, back almost 4 years ago now, um in Vancouver. And so, he's in the mining space. He's been an executive mining company, he's been very successful doing" }, { "speaker": "Speaker 1", "text": "that. And we started sort of just talking. He didn't have a lot of experience in crypto and and didn't understand that side of the industry, but understood mining really well. I understood the crypto side of the" }, { "speaker": "Speaker 1", "text": "industry and saw this, you know, thing that was happening, which was tokenization. And saw that as an opportunity to sort of, I think, bridge the gap between the two industries. And so, by having both of" }, { "speaker": "Speaker 1", "text": "our experiences, we came together, we created the idea on on which was StringX. Um managed to raise some some money from both friends and family, some high-net-worth investors. We didn't take" }, { "speaker": "Speaker 1", "text": "any VC capital when we were doing our our pre-seed and seed rounds. And then, we were able to go public in May of of last year. And so, we we took the company public, managed to raise a" }, { "speaker": "Speaker 1", "text": "significant amount of capital in the in the last year to set ourselves up to to grow." }, { "speaker": "Speaker 1", "text": "And now, we just launched our first product, which was the GLDY product. And so, you know, I think it's just over time, we we were able to set those goals and and and do that and raise the" }, { "speaker": "Speaker 1", "text": "capital that we needed to be able to to bring these things to market." }, { "speaker": "Speaker 2", "text": "How much of all of this is luck?" }, { "speaker": "Speaker 1", "text": "I don't know. I think there's probably a little bit of it. I don't know if it's luck, I think it's more timing." }, { "speaker": "Speaker 1", "text": "And I think I think if you work hard at anything, you know, you got a pretty good chance of having that luck." }, { "speaker": "Speaker 1", "text": "But I think when you get into times in the market when there is opportunities to be able to, you know, either raise money or or bring products to market, um it helps a lot. And so, I" }, { "speaker": "Speaker 1", "text": "think we had really good timing with with what we're doing. And I think right now is even a, you know, still a great time for what we're doing. Gold itself is still 46, 4700 dollars. It was up" }, { "speaker": "Speaker 1", "text": "over 100% last year. Tokenization is the one of the biggest topics in crypto right now, and like it is the future of uh of the financial ecosystem. And so, by having a company when we started it 4" }, { "speaker": "Speaker 1", "text": "years ago that was tokenization and gold, gold was, you know, $1800. Crypto and tokenization was hot, but tokenization wasn't really something that people talked about. And so, we were able to use that and bring it and" }, { "speaker": "Speaker 1", "text": "create a company around it. And when we went public, when we were raising money, it was the time and it it worked out well." }, { "speaker": "Speaker 2", "text": "How did you get so fascinated by the world of crypto and the blockchain?" }, { "speaker": "Speaker 1", "text": "I think the first thing that really got me into the space really was NFTs." }, { "speaker": "Speaker 1", "text": "And NFTs themselves, it was such a phenomenon. Like it was something where the amount of one projects that were launching and then, you know, cool things that were happening in the space" }, { "speaker": "Speaker 1", "text": "and and people, you know, creating these communities and and groups of people who really believed in something. It was a really cool opportunity. And so, I saw that opportunity. I brought together a" }, { "speaker": "Speaker 1", "text": "couple buddies and then we started that project and that's when I really got involved sort of in crypto. I'd been trading and and buying Bitcoin and stuff before that, but to be like really" }, { "speaker": "Speaker 1", "text": "involved in like building in the space and meeting other people who are building in the space, NFTs were really what what started that off." }, { "speaker": "Speaker 2", "text": "I have to ask." }, { "speaker": "Speaker 2", "text": "How can people take you seriously as the company CEO of a public company Mhm." }, { "speaker": "Speaker 2", "text": "when you built a NFT project, especially when you know how the NFT wave ended up for everyone, which is in complete shambles. Yeah." }, { "speaker": "Speaker 1", "text": "I think there was one thing that we did when we wound up the project when NFTs like really sort of took a a nose dive that uh from my point of view is more like a a good karma sort of thing. I knew that" }, { "speaker": "Speaker 1", "text": "I was going to build more after this, but my co-founder and I, we refunded everyone from our own pockets when we shut the project down. And so, we paid out quite a bit of money to to everyone" }, { "speaker": "Speaker 1", "text": "to be able to say, \"Hey, you know, thank you for supporting us." }, { "speaker": "Speaker 1", "text": "We're wrapping up the project. We're moving on. Here is, you know, the mint funds back.\" We kept 80% of the mint 80% of the mint funds in the treasury. We had our own capital as well, and so we" }, { "speaker": "Speaker 1", "text": "it was a very clean, I think, way to to do it. And we didn't have to do it, but it was something that when we saw it being able to move forward and build other stuff was really important for us. And then I" }, { "speaker": "Speaker 1", "text": "think when you look at the market right now, whether you're launching an NFT project, whether you're building a company, it's a lot of the same stuff, right? You're building a product that" }, { "speaker": "Speaker 1", "text": "people want to buy." }, { "speaker": "Speaker 1", "text": "And you are marketing that product. You are creating something that's differentiated in the market. And then moving forward with the business plan to be able to make sure that that product" }, { "speaker": "Speaker 1", "text": "is valuable. And so, whether that's NFTs, whether that's a private company, whether that's AI, whether that's tokenization, whether you're a public company, it's a lot of the same formula." }, { "speaker": "Speaker 1", "text": "And so, to be able to do that, I think, once is important. You need to understand what it's like to be a founder, and whether you're the founder of an NFT project or a public company," }, { "speaker": "Speaker 1", "text": "it's very similar." }, { "speaker": "Speaker 1", "text": "And then from there, a lot of it's, you know, talking with people, partnerships, building sales, all that sort of stuff." }, { "speaker": "Speaker 1", "text": "It's it's a lot of the same a lot of the same stuff." }, { "speaker": "Speaker 2", "text": "So, the NFT project is a very is an amazing way to actually learn all that stuff while having crazy fun at the same time. I think so. I think and it's accessible, right? Like it was it was it" }, { "speaker": "Speaker 1", "text": "was something where you know, I wouldn't have been able to raise the money to go public back in 2020." }, { "speaker": "Speaker 1", "text": ">> Yeah. But to be able to raise, you know, a couple million dollars for an NFT project in an industry that was booming was doable. And it was it was an opportunity. And so by seeing that" }, { "speaker": "Speaker 1", "text": "opportunity and and fulfilling that opportunity, I think it was a pretty it was a pretty cool time. And and we managed to do something that I was I was pretty proud of." }, { "speaker": "Speaker 2", "text": "How do you go and raise 50 or 60 million dollars when you're so young?" }, { "speaker": "Speaker 1", "text": "Like what's the way to do it? Mhm. Yeah, so we've raised in equity just over 55 million dollars now in the last 8 months." }, { "speaker": "Speaker 1", "text": "Um with that, I think a lot of it is having a good product and and showing investors that this is a product that is the future. And I think the other part of it is having people around you that" }, { "speaker": "Speaker 1", "text": "provide, whether that's credibility or knowledge or, you know, access to that to that capital. And so like our team, for example, it's it's not just me. You know, my co-founder Morgan, he's someone" }, { "speaker": "Speaker 1", "text": "who's been very successful in in raising money and building companies in the past. Our chief investment officer was the head of something called Wafra, which is the Kuwaiti sovereign wealth" }, { "speaker": "Speaker 1", "text": "fund. It's around a trillion-dollar fund. Um So they're all older. They're all older than me. Older, more experienced. They're Why are you the CEO then?" }, { "speaker": "Speaker 1", "text": "I think when you think of the industry that we're in and the opportunity that we're in, tokenization itself is a very young industry." }, { "speaker": "Speaker 1", "text": "And I think crypto and blockchain and and this new sort of future of finance is also a very young industry. And so a lot of people who are older never really had exposure to it. And they're only" }, { "speaker": "Speaker 1", "text": "learning about it now. Whereas I grew up in it. And I've built companies in it since I was young. And so by being able to have the sort of I think one, the ability to build and not, you" }, { "speaker": "Speaker 1", "text": "know, worry about other things that are in the world, but really focus on the company and build the company and have my experience in in crypto while having these people who are very experienced, whether it's in public" }, { "speaker": "Speaker 1", "text": "companies, whether it's raising money, whether it's operations, having those people around me, I like to, you know, be able to set the vision on things on what we're doing and then have everyone" }, { "speaker": "Speaker 1", "text": "around me to be able to execute it. And I think that's how any good team is really really made." }, { "speaker": "Speaker 2", "text": "You're the co-founder and CEO of Streamax." }, { "speaker": "Speaker 1", "text": "What is Streamax? Explain to my mom." }, { "speaker": "Speaker 1", "text": "So, Streamax is a one, public company." }, { "speaker": "Speaker 1", "text": "We issue tokenized commodities. And so, what tokenization is is essentially taking the physical asset, so whether that's gold or silver, and then creating a digital representation of it." }, { "speaker": "Speaker 1", "text": "The same way that a stock represents ownership in a company. And so, if you go buy a share of a company, you have ownership of that company." }, { "speaker": "Speaker 1", "text": "A digital token, and so whether that's GLDY, which is our gold asset, or whether that's the silver asset we launch, one token represents 1 oz of that physical asset. And you have direct ownership of it. You can trade" }, { "speaker": "Speaker 1", "text": "it, you can sell it, you can do whatever you want with it because you own it. It is a digital receipt of that. And so, we are a platform that enables people to participate in tokenized commodities and yield-bearing" }, { "speaker": "Speaker 1", "text": "tokenized commodities. And and we are bringing those into the into the market." }, { "speaker": "Speaker 2", "text": "Explain my mom to my mom why we need these tokenized commodities." }, { "speaker": "Speaker 1", "text": "I think there's a couple things that we look at. One, using gold as an example, gold right now, if you wanted to go buy gold, it would cost you money. So, whether you would be buying the physical" }, { "speaker": "Speaker 1", "text": "gold and and you need to store it somewhere, that will cost you money. Or if you want to buy, say, an ETF, which is super easy, you can log into your any account and buy an ETF, that will also" }, { "speaker": "Speaker 1", "text": "cost you money to hold." }, { "speaker": "Speaker 1", "text": "If you buy our product, which is GLDY, you can get the same exposure to gold, and so you can see gold when it goes up or down, you have the same exposure, but you also get paid uh 3 and 1/2% annual" }, { "speaker": "Speaker 1", "text": "yield for holding the gold. And so that's paid in additional gold every single month. And so if you want to own gold, or if you want to own any other commodity, tokenization allows us to do" }, { "speaker": "Speaker 1", "text": "these things and it gives us the ability to create these assets that are backed by real assets while giving a yield on top of it. And so that's specifically for the GLDY product, and I think it's" }, { "speaker": "Speaker 1", "text": "something that you know, for investors who want gold exposure, it is the best way for them to to be able to hold it." }, { "speaker": "Speaker 2", "text": "Can you explain why it's not possible, again, to my mom, simply?" }, { "speaker": "Speaker 2", "text": "Why is it not possible to earn yield on a non-tokenized asset?" }, { "speaker": "Speaker 1", "text": "So gold itself, traditionally, if it's an ETF or if it's physical, it just sits there." }, { "speaker": "Speaker 1", "text": "It's the whole pet rock theory that Warren Buffett loves to loves to use. He says, \"If you have an ounce of gold and you come back in 10 years, it's still an ounce of gold and it's just sitting" }, { "speaker": "Speaker 1", "text": "there. It's not really doing anything.\"" }, { "speaker": "Speaker 1", "text": "What we were able to do is we partnered with a group called Monetary Metals, which are a gold leasing company. What they do is they essentially rent gold or lease gold to companies that use it in" }, { "speaker": "Speaker 1", "text": "manufacturing. And so like a jeweler, for example, our largest lease client with Monetary Metals is a 4 and 1/2 5 billion dollar publicly traded jewelry company that has 6,000 stores worldwide." }, { "speaker": "Speaker 1", "text": "And they need gold to be able to create the jewelry, whether it's a watch or a bracelet or a chain, whatever that is." }, { "speaker": "Speaker 1", "text": "And so they rent the gold, they lease the gold from us. They pay us to be able to use it." }, { "speaker": "Speaker 1", "text": "The gold is in our title the whole time, and so the token's always backed by that gold. And then the tokens represent the gold assets themselves, and so you are long the gold. You get additional gold" }, { "speaker": "Speaker 1", "text": "every single month for holding the asset. And then from there, you can decide if you want to hold it, you can trade it, you can do whatever you'd like with it. It's it's really it's your" }, { "speaker": "Speaker 1", "text": "ownership, and it gives the ability for people to participate in a market where they really have never had access to before. And that is enabled by us tokenizing it and turning it into a" }, { "speaker": "Speaker 1", "text": "tradeable security asset." }, { "speaker": "Speaker 2", "text": "So, that means that the the lending of gold obviously is already exists." }, { "speaker": "Speaker 2", "text": ">> Mhm." }, { "speaker": "Speaker 2", "text": "But the money could not be made by retail investor. No." }, { "speaker": "Speaker 1", "text": "No, it's it's really tokenization and and by us creating the structure, it reduces a lot of friction points." }, { "speaker": "Speaker 1", "text": "And so if you wanted to do this yourself right now, it would be very hard for you to be able to go and enter into a lease and get the yield and send your gold and do all that sort of stuff. When" }, { "speaker": "Speaker 1", "text": "you buy JLDY, all you need to think of is buying one asset and getting all the benefits that we handle on the back end both with our partners Monetary Metals and within our infrastructure. And so," }, { "speaker": "Speaker 1", "text": "it reduces a lot of those friction points and gives the ability for people to participate in it without having to worry about hey, how do what what how does a lease work? What is the what are" }, { "speaker": "Speaker 1", "text": "the documentations look like? What is the credit agreement with the the leasing party? What it's it it reduces all those sort of points and gives the ability for people just to think about" }, { "speaker": "Speaker 1", "text": "owning gold with a yield on top of it." }, { "speaker": "Speaker 1", "text": "Why gold?" }, { "speaker": "Speaker 1", "text": "Gold I think one, it's one of the largest markets in the world." }, { "speaker": "Speaker 1", "text": "It has been a store of value for 6,000 years, and it'll continue to be a store of value with everything that's happening in the world. I think everyone should own a little bit of gold. And so," }, { "speaker": "Speaker 1", "text": "it it really protects yourselves against any inflation or debasement or anything that's happening in the market right now. And I think it's something that's easy for people to understand. And so gold itself" }, { "speaker": "Speaker 1", "text": "really is just our first asset. And so GLDY, the yield bearing gold product, is the first asset that we're launching." }, { "speaker": "Speaker 1", "text": "We can grow that very large. And then from there expand it to silver, into copper, into oil, into gas, into other assets as well." }, { "speaker": "Speaker 2", "text": "Why do you need Why do you need to do this to a public company?" }, { "speaker": "Speaker 1", "text": "I think there's a couple things that being public does. One is credibility." }, { "speaker": "Speaker 1", "text": "And so we have audited financials, where you are a US public company, and that's important when we're dealing with more institutional clients and and investors." }, { "speaker": "Speaker 1", "text": "One, it allowed two, it allowed us to raise a significant capital to be able to do what we need to do, and also build a team around us that was, >> [snorts] >> you know, significant and a significant" }, { "speaker": "Speaker 1", "text": "team around us to be able to do what we need to do. Um and I think it's something that generally being public provides a lot of of benefits for for us to be able to go into markets that traditionally we" }, { "speaker": "Speaker 1", "text": "might not have had access to." }, { "speaker": "Speaker 2", "text": "Does it make sense to be in Canada if the company is listed in the US?" }, { "speaker": "Speaker 1", "text": "I am a Canadian. We started the company out of Canada. Um the company is a US a US public company. And so >> it a US public company and not a Canada public company? One, we wanted to go" }, { "speaker": "Speaker 1", "text": "public on the Nasdaq." }, { "speaker": "Speaker 1", "text": "And so, as I think a lot of people know, the US public markets are a lot or I mean in the world, they are the largest public markets in the world. And that comes with a lot of benefits to being a" }, { "speaker": "Speaker 1", "text": "US public company. And so we had an opportunity to go public in Canada, we chose to go public in the US because it is a much larger market, and also our primary customers are also in the in the" }, { "speaker": "Speaker 2", "text": "US for the for the asset itself." }, { "speaker": "Speaker 2", "text": "Big thanks to NordVPN for sponsoring these episodes of the drops. We spend a lot of time on this show talking about the future of the internet, but digital privacy still matters. Whether you're" }, { "speaker": "Speaker 2", "text": "traveling, working remotely, or on a public Wi-Fi, NordVPN is a simple way to add an extra layer of security. Check them out in the description and use our promo code for discount." }, { "speaker": "Speaker 2", "text": "How do you surround yourself when you're so young, but you want to look more serious in the traditional finance world?" }, { "speaker": "Speaker 1", "text": "I think it's a couple things. I think honestly, it hasn't been something that I've experienced too much in terms of people if you're young and and not taking you seriously. I think it's something that" }, { "speaker": "Speaker 1", "text": "if you're doing something cool and if you have the ability to raise the amount of capital that we have as a company, there is a seriousness about that. And so, whether I'm 26 or 56, it really" }, { "speaker": "Speaker 1", "text": "doesn't make a difference. We've all done or we've done what we have done up to this point in terms of raising money, in terms of launching product, and I think like I said earlier, having the" }, { "speaker": "Speaker 1", "text": "team around me of of people and even our board of of people who are well experienced in this space and then being able to continue to grow that and also lead them to a spot, I think it's" }, { "speaker": "Speaker 1", "text": "something that it it ends up working out. And and I think that we have a a very strong culture of of people who both support me and also support everyone else within the company to do what we need to do." }, { "speaker": "Speaker 1", "text": "What is Stream X? Is it a crypto company? Is it a commodities company? Is it a financial services company? I think the way to think of Stream X is we are a tokenization company at our core" }, { "speaker": "Speaker 1", "text": "and we operate in the financial services business." }, { "speaker": "Speaker 1", "text": "And so, we create assets. We are the issuer. We are the platform that creates these assets and brings them to market working within an institutional sort of focused area, which is, for for" }, { "speaker": "Speaker 1", "text": "selling GLDY to ETFs, to hedge funds, to family offices, integrations with RIAs, and other sort of large institutional investors on on that side and creating the platform for them to be able to" }, { "speaker": "Speaker 1", "text": "participate in these in these assets." }, { "speaker": "Speaker 1", "text": "And so, we're both operating at the future of finance, which is tokenization, and the sort of existing institutional financial side of things in the traditional markets. And so, we" }, { "speaker": "Speaker 1", "text": "really are, I think, we're a unique company in that sense because we have the experience both in the traditional side and also in the the crypto and and DeFi side. And so, GLDY itself, like I said, is a much more" }, { "speaker": "Speaker 1", "text": "institutional focused asset, but we will be expanding into DeFi with less permissioned assets and retail ability assets using vaults and different sort of yield mechanisms on those assets to" }, { "speaker": "Speaker 1", "text": "increase the yield even beyond the 3 and 1/2%. And so, I think when you think of us, it's really tokenization and financial services." }, { "speaker": "Speaker 1", "text": "Explain this gold product, GLDY, as simple as possible and compare it to other gold products that exist out there. Yeah, so GLDY at its core, it is a spot gold asset similar to Paxos Tether, where you own the physical" }, { "speaker": "Speaker 1", "text": "underlying gold, but then you get paid additional gold every single month. And that is generated through gold leasing." }, { "speaker": "Speaker 1", "text": "If you look at it from a other sort of competing gold products out there, whether it's an ETF or whether it's a owning the physical gold, those, like I said earlier, they cost you money to hold. And so, if it's an" }, { "speaker": "Speaker 1", "text": "ETF, you're holding gold, you get the exposure, but you need to pay 40 basis points a year to be able to hold it." }, { "speaker": "Speaker 1", "text": "If you're owning the physical gold, you own the physical, it's sitting in a vault, you need to pay almost 50 basis points a year in insurance and storage costs to be able to store it. And so," }, { "speaker": "Speaker 1", "text": "essentially, every single year your amount of gold that you're holding is getting eroded. And you are losing actual ounces of gold from paying those fees." }, { "speaker": "Speaker 1", "text": "With GLDY, you get the same exposure to gold, but then you also get paid an up three and three and a half percent dividend every single year in additional gold. And so that's something that I" }, { "speaker": "Speaker 1", "text": "think is is very powerful. There's no manager like there's no fees that we take from the gold itself. Your ounce of gold is never invaded and you get paid to to hold it. And so it's one of the" }, { "speaker": "Speaker 1", "text": "only assets out there that you can do that with. How is it different from the Tether gold, Paxos gold? Yeah, so Tether gold, Paxos gold, very similar structure in terms of the backing of the asset" }, { "speaker": "Speaker 1", "text": "where one token is one ounce of of gold, but they don't pay a yield. And so there's no inherent yield to the to the asset. And so the same thing that your gold will always be just one ounce if" }, { "speaker": "Speaker 1", "text": "you own Tether Tether or or Paxos. If you own GLDY, you get compounding GLDY every month. Okay, so I mean Tether gold, you can probably lend it out and make some yield, but you not need to go" }, { "speaker": "Speaker 2", "text": "and lend it out and you're not necessarily sure what's how what's being the the the the use of your token and underlying gold, right?" }, { "speaker": "Speaker 2", "text": "Whereas your product automatically you get the yield." }, { "speaker": "Speaker 1", "text": "Automatically, just for holding it. It gets sent to your wallet every single month or wherever you're holding it." }, { "speaker": "Speaker 1", "text": "Which means that if how scalable is that? Very scalable." }, { "speaker": "Speaker 1", "text": "How? So the leasing market where we get the yield from is very large. And so jewelry alone is 15 to 20% 20% of the of the gold market. The gold market is 35 trillion dollars." }, { "speaker": "Speaker 1", "text": "And so with that with our partners Monetary Metals, they have stated within sort of two to three years we would be able to get 10 to 20 billion dollars of gold on lease. There's that much demand" }, { "speaker": "Speaker 1", "text": "for it. And so the issue really isn't demand or scalability of the yield mechanism. It is how much gold can we get to be able to put on lease. And so that's really that's our biggest focus" }, { "speaker": "Speaker 1", "text": "right now is distribution of the of the asset. Now that we've launched, our focus is on distribution and bringing these assets to people and showing them, \"Hey, you can purchase this. You can get" }, { "speaker": "Speaker 1", "text": "gold with yield.\" Selling the asset to these large institutions for for larger orders like ETFs, for example." }, { "speaker": "Speaker 1", "text": "And from there the the scalability issue is is very much not not not a problem for us on the on the demand side." }, { "speaker": "Speaker 2", "text": "Explain this 3.5% yield >> Mhm." }, { "speaker": "Speaker 2", "text": "more specifically." }, { "speaker": "Speaker 1", "text": "Who is involved? How do How does it work?" }, { "speaker": "Speaker 1", "text": "So the yield itself, the 3 and 1/2% is generated, like I said, through gold leasing." }, { "speaker": "Speaker 1", "text": "Gold leasing >> Which means? Which means essentially you have a jeweler who needs gold to be able to create their jewelry." }, { "speaker": "Speaker 2", "text": "They don't want to be long gold. They don't want to buy it. They don't want to buy it. They don't want to buy what's needed to create that jewelry piece. No." }, { "speaker": "Speaker 1", "text": "In terms of gold? No. Because they all they want to do is make that 15 to 20% margin Mhm. on their jewelries. They they don't want to be long gold price." }, { "speaker": "Speaker 1", "text": "If gold goes up or down, that's actually a problem for them because it it hurts when you're in when you're in manufacturing." }, { "speaker": "Speaker 1", "text": "Traditionally, what they would do is they would go borrow money from a bank and then hedge out the gold exposure. So they would be essentially delta neutral on the on the gold exposure. That's" }, { "speaker": "Speaker 1", "text": "expensive." }, { "speaker": "Speaker 1", "text": "So instead of doing that, they lease gold from us. So they borrow it from us." }, { "speaker": "Speaker 1", "text": "They have the ability to use it. They have the the right to alteration of form and possession. But we retain title the whole time." }, { "speaker": "Speaker 1", "text": "Everything's 110% collateralized and so they go and make the jewelry. Say they sell a gold chain, it's a 1-oz gold chain. They will then go and rebuy that 1 oz of gold so the lease is always 110%" }, { "speaker": "Speaker 1", "text": "collateralized. There's there's always that gold there." }, { "speaker": "Speaker 2", "text": ">> do >> hedge for because cuz what they need to give you back is the is the gold that they borrowed, right?" }, { "speaker": "Speaker 1", "text": ">> us gold back. But the price might change. Correct. And so this is the beautiful thing about leasing where because they're borrowing gold in ounces and they're also repaying gold in ounces" }, { "speaker": "Speaker 1", "text": "and they're selling their product in ounces, they don't ever have to worry about the US dollar price of gold." }, { "speaker": "Speaker 2", "text": ">> is the the denomination is ounce?" }, { "speaker": "Speaker 2", "text": "Correct." }, { "speaker": "Speaker 2", "text": ">> [snorts] >> Okay." }, { "speaker": "Speaker 2", "text": "But the yield is paid in dollars. Yield is paid in gold." }, { "speaker": "Speaker 1", "text": "So the yield is paid in additional gold every single month. And so you actually get additional GLDY tokens every single month, which is additional gold directly into your wallet. But the jewel the" }, { "speaker": "Speaker 1", "text": "jeweler or jeweler how do they pay back what they owe plus the yield? It's all in gold. It's all in gold. So they So They would buy gold." }, { "speaker": "Speaker 1", "text": "Okay. And then send that to us." }, { "speaker": "Speaker 2", "text": "That's what I don't understand." }, { "speaker": "Speaker 2", "text": "The these I mean and you said I think it's 6% right the the the what they actually pay is 6%." }, { "speaker": "Speaker 2", "text": ">> 6% line, yeah." }, { "speaker": "Speaker 1", "text": "So the 6% must be at some point coming from dollar to gold. At at one point they will buy they will buy but that's that's at any given time. They're never really they're never long that exposure." }, { "speaker": "Speaker 1", "text": "Mhm. If they need to repay the the loan or the the lease essentially at one point they will simply buy the gold at that one point and that 6% fee whatever that value is is de minimis compared to what they" }, { "speaker": "Speaker 2", "text": "would have been paying in the in hedging." }, { "speaker": "Speaker 2", "text": "Okay. So 6% 3% goes to 3.5% goes to the token holder. Where where does the get the rest go?" }, { "speaker": "Speaker 1", "text": "1% goes to Stream and so that is our our management fee. 1 and 1/2% goes to Monetary Metals for both the insurance on the leases and so the leases are insured on two levels and origination, everything running" }, { "speaker": "Speaker 1", "text": "their business and profit for for them." }, { "speaker": "Speaker 1", "text": "And so, the the friction is essentially leaves 3 and 1/2% for the for the holder." }, { "speaker": "Speaker 2", "text": "So, your business model is 1% on that." }, { "speaker": "Speaker 1", "text": "Our business model is a little bit greater than that. And so, there's the 1% and then also because this is trading primarily on decentralized avenues like decentralized AMMs that will be coming" }, { "speaker": "Speaker 1", "text": "live as well as you know, different ATSs." }, { "speaker": "Speaker 1", "text": "We're taking a small transfer fee on the asset. And so, every single time that the asset trades, there's a small fee that comes back to Streamax. If you look at the market right now on both security" }, { "speaker": "Speaker 1", "text": "tokens and gold tokens like PAX or or Tether, they trade a lot." }, { "speaker": "Speaker 1", "text": "Gold is an inherently very liquid asset." }, { "speaker": "Speaker 1", "text": "And so, that is something that as we develop these secondary markets and as they come online, which will be very shortly here, there will be transaction fee revenue coming from that as well." }, { "speaker": "Speaker 1", "text": "And then there's also a small tokenization fee that we're waving for the initial launch period, but that will also be there um to to bring revenue into the company, too." }, { "speaker": "Speaker 2", "text": "There's no yield without risk." }, { "speaker": "Speaker 2", "text": "What's the risk that comes with lending out the gold and the business model itself? Yeah, so it's really good question. And and I think a lot of the risk is mitigated through a couple of different avenues. And so," }, { "speaker": "Speaker 1", "text": "whenever gold leaves a vault, people ask questions. They where is my gold going?" }, { "speaker": "Speaker 1", "text": "What is happening to it? This process of gold leasing has been in operations for a very long time. It's been done by banks. It's now done by our partners Monetary Metals who have been doing it" }, { "speaker": "Speaker 1", "text": "for over a decade and they've had a lot of very successful experience with with doing that. And so, one, everything is insured on two levels." }, { "speaker": "Speaker 1", "text": "So, it's insured at the jeweler level and it's insured on the lease level by Allianz and Lloyd's of London, which are two of the largest insurance carriers in the in the world. And so," }, { "speaker": "Speaker 1", "text": "those are two counterparties that mitigate risk. Everything is also RFID tagged. And so, we know where the gold is at any given time. We can go pick it up and take it at any given time if we" }, { "speaker": "Speaker 1", "text": "feel like there is a a risky situation, which normally there isn't. How does that work RFID tagged concretely like is it what what is the tag? Where is the tag?" }, { "speaker": "Speaker 1", "text": "Yeah, so it's actually it's like it's pretty cool. It's like a essentially like a plastic box that is tamper-proof and it is locked. When the gold needs to move from one spot to another," }, { "speaker": "Speaker 1", "text": "it gets broken, taken into another box, the jewelry is made, put into another box, and so we actually check that and Monetary Metals checks that every single day to make sure that the gold that" }, { "speaker": "Speaker 1", "text": "we've leased to them is actually there and is accounted for correctly." }, { "speaker": "Speaker 2", "text": "Okay, I understand. Interesting." }, { "speaker": "Speaker 2", "text": "But the gold needs to leave that box at one point." }, { "speaker": "Speaker 2", "text": ">> to another box. at one point. How do you ensure that there's not someone who comes and put some something in there Yeah. to make it less pure or fake it or I mean it's probably a massive problem in the" }, { "speaker": "Speaker 2", "text": "precious metal world, right? It is." }, { "speaker": "Speaker 1", "text": ">> Which is a problem we don't have with Bitcoin for example. Mhm. Yeah, so I think it's something that one this has been happening for a very long time and there are multiple avenues to" }, { "speaker": "Speaker 1", "text": "be able to check that that gold is actually gold. You know, we do spot checks on the gold to be able to make sure that the gold is is actual 22 karat investment grade gold." }, { "speaker": "Speaker 1", "text": "From there, the counterparties that we are leasing to like the the large jewelry companies for example a four and a half billion dollar jeweler that I was talking about with 6,000 stores," }, { "speaker": "Speaker 1", "text": "they're not in the business of, you know, skimming half an ounce of gold here, skimming half an ounce of gold there. We we are leasing to institutional counterparties and these are people that" }, { "speaker": "Speaker 1", "text": "if that ever happened within their business, it would not be very good for them. And so we make sure that even beyond all of these checks and balances and RFID tagging and insurance and" }, { "speaker": "Speaker 1", "text": "everything, that the actual counterparty that we're leasing to is fully vetted and make sure that they are, you know, a stand-up institution with with no issues." }, { "speaker": "Speaker 2", "text": "Are there other ways to earn yield on gold than that?" }, { "speaker": "Speaker 1", "text": "I think there's yield-bearing gold ETFs." }, { "speaker": "Speaker 1", "text": "The way that they earn yield on those is financial engineering. And so, selling covered calls, you know, going short gold futures, stuff like that. What that does is it caps your upside. And so, if you sell a" }, { "speaker": "Speaker 1", "text": "covered call on gold at $5,000 and gold goes to 5,500, you're going to miss out on that whole $500 delta between that." }, { "speaker": "Speaker 1", "text": "And so, it doesn't really track gold price. It doesn't really give you the ability to get additional gold. You get yield in in dollars. And so, this structure that we've created with" }, { "speaker": "Speaker 1", "text": "Yieldly Y really is the most efficient and and best structure to actually get yield on on gold. Other ways are just, like I said, financial engineering." }, { "speaker": "Speaker 2", "text": "What's your goal with with this gold product?" }, { "speaker": "Speaker 1", "text": "Yieldly Y itself, we want to have it to a billion dollars in AUM by the end of the year." }, { "speaker": "Speaker 1", "text": "And so, that's a goal that we've had since we launched. It's something that you know, I think it's I think it's attainable. I think it's it's something that we're working towards, whether it" }, { "speaker": "Speaker 1", "text": "happens this year or next year. I think it's something that is is very real. And the way that we look at it right now is there's 560 billion dollars in gold ETFs. And those are ETFs where people" }, { "speaker": "Speaker 1", "text": "are comfortable paying that 30 or 40 basis point management fee to be able to hold." }, { "speaker": "Speaker 1", "text": "If you rotate the classic thing, rotate 1% of that market into another asset, that's a lot of money." }, { "speaker": "Speaker 1", "text": "And so, I I think it's something that as adoption comes online and and as we continue to be out there with the product, showing, for example, we just paid the first dividend of the asset. We" }, { "speaker": "Speaker 1", "text": "show that it works. We show that the leasing actually works. You're getting paid additional gold to hold it. We're going to be publishing the first first attestation. We're going to be, you" }, { "speaker": "Speaker 1", "text": "know, we we published the the NAV that shows that the the NAV of the the gold tracks the gold price. The GLDY tracks the gold price directly. And so once the I think the when we continue showing this in the" }, { "speaker": "Speaker 1", "text": "market and and proving that out and and start gaining the trust of these large institutions that we're onboarding, especially with the partnerships that we have coming online with some pretty big" }, { "speaker": "Speaker 1", "text": "ones, it's going to be an asset that is bought, not sold. And and right now it really is it's an asset that's sold." }, { "speaker": "Speaker 1", "text": "It's a new asset. It's one that we're bringing out that we're telling people about that we're educating people about." }, { "speaker": "Speaker 1", "text": "This is how it works. But like any asset, as it is in the market long enough and as it starts to get traction, when you look at it, there's no better gold asset out there to be able to own." }, { "speaker": "Speaker 1", "text": "And and I think GLDY will really be at the top of that conversation. And that's like I said, just one asset that we're creating. And so we're going to be launching silver. We're going to be" }, { "speaker": "Speaker 1", "text": "launch launching a permissionless, more retail-focused version of GLDY as well." }, { "speaker": "Speaker 1", "text": "And so for StreamExchange as a company, our goal is both to scale GLDY as well as bring other assets out and grow the StreamExchange platform. But GLDY right now really is a a big focus for us to be" }, { "speaker": "Speaker 2", "text": "able to grow AUM and bring investors into into that. Why is this product, specific product, more institution-focused?" }, { "speaker": "Speaker 1", "text": "Right now it's a security. And so GLDY is a a security asset because it pays a yield inherently." }, { "speaker": "Speaker 1", "text": "And so it's issued through Reg D, similar to Ondo or Bito. And so that inherently makes it obviously retail can't can't participate right now in it." }, { "speaker": "Speaker 1", "text": "And so our focus really is on institutional money and and clients because one, there's a lot of capital there. And being able to partner with like RAs, IRAs in the US, wealth managers, ETFs provides us access to to" }, { "speaker": "Speaker 1", "text": "capital to be able to to purchase the asset. But like I said, we also want to be able to have that retail distribution. And so we will be coming out with a more permissionless and retail-focused version of of GLDY as" }, { "speaker": "Speaker 1", "text": "well that will, you know, the structure itself will be a little bit different, but it will provide the same uh exposure and yield on gold as well. What's something that we haven't talked about" }, { "speaker": "Speaker 1", "text": "regarding this GLDY product that we should You know, I think I think GLDY it's it's very interesting because we get a lot of the same questions that you've been asking. Where does the yield come from?" }, { "speaker": "Speaker 1", "text": "How does it work? How do we know that it's safe? What is the mechanism that drives it? And so, the one thing that I think I would would leave people with is one, the way that it's set up is" }, { "speaker": "Speaker 1", "text": "institutional grade. It is very institutionalized as an asset in that sense, and it it is when you see the the the things that we're going to come out with, you will see that large" }, { "speaker": "Speaker 1", "text": "institutions trust the asset. And when that happens, I think that's the biggest thing. And as we grow you in, and so, with that, when you create anything new, and this has never never really been done before," }, { "speaker": "Speaker 1", "text": "there's always questions about it. But I think as time goes on and as people start to understand, \"Hey, this is how it works. This is what it is.\"" }, { "speaker": "Speaker 1", "text": "Tokenization gets more accepted and the the rails really come into place for that, it takes off very very quickly." }, { "speaker": "Speaker 1", "text": "And and so, right now, just with tokenization in general, you're seeing the amount of investment, and you're seeing the amount of interest sort of flowing into the space. And so, for us" }, { "speaker": "Speaker 1", "text": "to be able to be both at the intersection of commodities, which is already a massive industry, and tokenization, which is the future of of the financial markets, it provides us a very unique sort of" }, { "speaker": "Speaker 1", "text": "platform to be able to benefit from from both. And so, in closing, I guess, it's a very exciting time. There's a lot of really exciting things coming, and and I think we really are at the cutting" }, { "speaker": "Speaker 2", "text": "edge of of what that's going to look like into the into the future. What's the kind of institution maybe in size or in the way they do things that's more likely to trust what do guys offer" }, { "speaker": "Speaker 2", "text": "first? Yeah." }, { "speaker": "Speaker 2", "text": ">> To then bring this additional trust to like the older, bigger ones that are kind of like more boring but more scared. Yeah. No, so it's really funny." }, { "speaker": "Speaker 1", "text": "So, we've talked with everyone from Fidelity to BlackRock to smaller ETF providers, mid-size ETF providers, RIAs, and so the what we've seen is the ones that are willing to move quicker are" }, { "speaker": "Speaker 1", "text": "sort of on the the lower to mid-tier because they're looking for an edge." }, { "speaker": "Speaker 1", "text": "They're looking for how do I disrupt BlackRock's gold ETF, which is a $180 billion, and how do I take some of that AUM and bring it over to to me?" }, { "speaker": "Speaker 1", "text": "For example. And so, those are going to be the first movers into into anything." }, { "speaker": "Speaker 1", "text": "Fidelity told us, they were like, \"We're not going to be the first mover into anything. We have such a strong brand. We don't need to sort of chase that.\"" }, { "speaker": "Speaker 1", "text": "But, when those small guys or mid-tier guys take hold and and start showing that this is something that is feasible and that is that is valuable and provides that value to their investors," }, { "speaker": "Speaker 1", "text": "that's when the bigger people start moving very quickly. And and so, I think like anything, we need to build a strong base, and then from there, we can expand into the Fidelitys, the BlackRocks, the the" }, { "speaker": "Speaker 1", "text": "large institutions out there right now." }, { "speaker": "Speaker 1", "text": "And so, that's really how we think about it and and sort of what we've seen so far." }, { "speaker": "Speaker 2", "text": "Your next [snorts] focus is silver." }, { "speaker": "Speaker 1", "text": "Why?" }, { "speaker": "Speaker 1", "text": "Silver itself is [snorts] same to gold as, you know, Ethereum is to to Bitcoin." }, { "speaker": "Speaker 1", "text": "It's the the second largest commodity asset in the world um from a from a metal standpoint. And so, it's something that one, people love to own, people love to trade, people love to speculate on." }, { "speaker": "Speaker 1", "text": "If we can bring that on chain, right now silver, there isn't really a large tokenized silver asset out there right now. And so, that's a market that I think that we can really tap into. I" }, { "speaker": "Speaker 1", "text": "think for for us, the way that you'll see it sort of roll out is we are going to be rolling out additional functionality for GLDY and additional opportunities for people to participate" }, { "speaker": "Speaker 1", "text": "in GLDY and then silver will come out right after that to really sort of bolster Stream X and the silver asset will be a retail available asset. It will not be a security. Yield will be" }, { "speaker": "Speaker 1", "text": "distributed a little bit different way and so we want to have really the full stack of of commodities and gold and silver are really just the first two. As we expand and and go beyond that into" }, { "speaker": "Speaker 1", "text": "copper, oil, gas, other commodities too, it becomes very prevalent that Stream X really is a platform, not a not a single asset issuer or single asset company." }, { "speaker": "Speaker 2", "text": "You say it's going to be more of a retail product." }, { "speaker": "Speaker 1", "text": "Why? Why silver more of a retail product than gold, which is more of an institutional focused product? I think silver traditionally, if you look at it sort of in the market, there is a lot of" }, { "speaker": "Speaker 1", "text": "retail interest in in silver and it is a a more retail focused asset for traders and for for investors and so by giving opportunity for people to participate in that, anyone to participate in that and" }, { "speaker": "Speaker 1", "text": "that does not exclude institutional investors from participating, it just gives access to a lot more people and so we saw with GLDY having it really institutional focused, we're targeting these big institutions." }, { "speaker": "Speaker 1", "text": "We also want to be able to use our experience in in DeFi and in crypto and and blockchain to be able to show how we can create a tokenized silver asset that is composable within DeFi and can be" }, { "speaker": "Speaker 1", "text": "used within the you know, trillions of dollars that is in is that is in crypto and and be able to expand in that space too and so I think it's important for us as a firm to be able to have" }, { "speaker": "Speaker 1", "text": "access to both retail and institutional and so we want to have silver sort of access to both." }, { "speaker": "Speaker 2", "text": "The other day we talked and you told me the silver product will offer yield through vault infrastructure." }, { "speaker": "Speaker 2", "text": "What the hell does that mean? Explain to a simple noob like me." }, { "speaker": "Speaker 1", "text": "So, vaults themselves are something that has become very popular with real world assets." }, { "speaker": "Speaker 1", "text": "And so, if you look at the DeFi landscape right now with the different staking avenues that you can go, the different ways that you can get yield, there's a ton of different avenues. And" }, { "speaker": "Speaker 1", "text": "so, you can stake with Morpheus, you can do a bunch of different things. Vaults now are becoming very powerful within real world assets because it allows people to create strategies" }, { "speaker": "Speaker 1", "text": "around those real world assets to be able to provide yield on them." }, { "speaker": "Speaker 1", "text": "You can sort of think of it like uh like a decentralized hedge fund that is that is creating this strategy to be able to give yield on physical physical RWAs. And so, for us to be able" }, { "speaker": "Speaker 1", "text": "to integrate into that ecosystem and give people both the ability to hold the underlying and invest in the underlying, but also enter these vaults and be able to give people the ability to get" }, { "speaker": "Speaker 1", "text": "additional yield on what they're on what they're holding." }, { "speaker": "Speaker 1", "text": "It's something that with any developed market, you want to you want to have." }, { "speaker": "Speaker 1", "text": "And if that is someone's risk appetite and they want to participate in that, we want to give that opportunity for them because people seek it out themselves and we can help help do that and and" }, { "speaker": "Speaker 1", "text": "provide yield on these physical commodities and it'll be for silver, it'll be for our permissionless GLDY product, too." }, { "speaker": "Speaker 1", "text": "Um the ability to get additional yield on top of whatever is inherent to the to the asset." }, { "speaker": "Speaker 2", "text": "How different is it to build?" }, { "speaker": "Speaker 2", "text": "You mentioned a security, right? GLDY with yield and then you mentioned permissionless product." }, { "speaker": "Speaker 1", "text": "So, the security itself is full KYC. So, you need to know everybody who holds the asset. They need to be KYC'd. We need to essentially white list their wallet address so that they can hold and and" }, { "speaker": "Speaker 1", "text": "trade the the asset. And that's just those are securities regulations where you need to know who the who the holder is. With a permissionless asset, meaning that there is no KYC, anyone" }, { "speaker": "Speaker 1", "text": "can hold the asset. Of course, there's different sanctions and stuff using chain analysis and TRM that we need to do on those, but if you think of it like USDC or other um permissionless crypto products like" }, { "speaker": "Speaker 1", "text": "stablecoins and stuff, it gives the ability for anyone to participate and removes a lot of friction points. So, you don't need to be an accredited investor to be able to purchase it." }, { "speaker": "Speaker 1", "text": "Anyone can purchase it. Anyone can trade it. Anyone can interact with it however that they want, and there is no no gating sort of features to it. Mhm." }, { "speaker": "Speaker 1", "text": "What's next after silver?" }, { "speaker": "Speaker 1", "text": "Next is either going to be It'll be sort of two things. One is going to be royalties and streams, which are some of the most valuable financial assets in the commodity space. W- What is this?" }, { "speaker": "Speaker 1", "text": "Explain. It is a contract that gives you the right to production from mine." }, { "speaker": "Speaker 1", "text": "And so, a royalty, for example, is a contract that states, say, for example, you own 5% of the production of that mine. And so, if the mine produces $100 million of gold, you get $5 million for" }, { "speaker": "Speaker 1", "text": "the lifetime that that mine is is producing. There's different structures to it. Same thing with streams." }, { "speaker": "Speaker 1", "text": "And so, those are assets that traditionally people really did not have access to. And that's actually where the name Stream X comes from." }, { "speaker": "Speaker 1", "text": "And so, it's something that when we started Stream X, we're thinking we're looking at the market. We're like, \"Hey, royalty companies in mining are some of the biggest companies in the world, and" }, { "speaker": "Speaker 2", "text": "they make a lot of money holding these royalties and streams.\" Can Can you explain how all this works because for me, I don't understand this sector." }, { "speaker": "Speaker 2", "text": "So, I would I would guess a company owns a mine or multiple mines. Mhm." }, { "speaker": "Speaker 2", "text": "And then if you want 5% of the mine, Mhm. I mean, the hypothesis would be one company owns one mine. Therefore, I buy 5% of the company if I want to own the $5 million a year, right? Yeah, so" }, { "speaker": "Speaker 1", "text": ">> talked about Yeah. How does it work?" }, { "speaker": "Speaker 1", "text": "Almost. And so, it's a it's essentially it's an alternative form of financing for a mine. And so, if a mine is starting to get going and they need money to be able to to build the project." }, { "speaker": "Speaker 2", "text": "Either they can sell equity, they can raise debt, or they can sell a royalty on the mine. Okay, it's the same as It's the same as um Barcelona Football Club that says, \"I'm going to make that much revenue in the" }, { "speaker": "Speaker 2", "text": "future whether from advertisement or from uh from any type of revenue uh tickets and I'll I sell future revenue to raise money.\" Exactly." }, { "speaker": "Speaker 1", "text": "Exactly. And so, same thing if you own say a a royalty on a music catalog." }, { "speaker": "Speaker 2", "text": ">> So, so the difference is that you will not have voting rights in the company." }, { "speaker": "Speaker 1", "text": "You will only own the future revenue or chunk of it. You would own, yes. a certain type of revenue. Correct. And see, you wouldn't own equity in the company, but you would own a portion of" }, { "speaker": "Speaker 2", "text": "the revenue in the in the future." }, { "speaker": "Speaker 2", "text": ">> So, you said royal royalty and streams." }, { "speaker": "Speaker 1", "text": ">> Mhm. What is streams? Stream is a very similar to a royalty, very similar structure, but instead of a fixed percentage, you have a the right to buy whatever the commodity is, gold for" }, { "speaker": "Speaker 1", "text": "example, at a certain discount to what the the spot price is. And so, if gold is trading at 4,600, for example, and you have a royalty to buy it at 20% of our stream to buy it at 20% of spot," }, { "speaker": "Speaker 1", "text": "then for the life of the mine, you're able to play that 80% um vig on the on the on the price of the asset." }, { "speaker": "Speaker 2", "text": ">> So, what you buy is a percentage discount. Correct." }, { "speaker": "Speaker 1", "text": "And so, these assets themselves are traditionally not accessible to individuals." }, { "speaker": "Speaker 2", "text": ">> to understand, the mining company would say, \"We'd do this in because because they want to raise money. Yep." }, { "speaker": "Speaker 2", "text": "Right? And because they make more profit than the percentage discount that they give you. Therefore, they're like, we're just going to make less profit in the future forever. Yeah. Until maybe we buy" }, { "speaker": "Speaker 1", "text": "back this stream or whatever." }, { "speaker": "Speaker 2", "text": ">> buy it back. Yeah. And so So, let's say the percentage profit is 50%. Like they say, we can do it at 20%. So, we're going to make less profit, 30%. Yeah." }, { "speaker": "Speaker 1", "text": "But we can finance ourselves. Exactly." }, { "speaker": "Speaker 1", "text": "And and without having to dilute themselves or take on debt." }, { "speaker": "Speaker 1", "text": "And so, it provides an attractive way for them to to finance. And so, it's an industry that's been around for a number of years. And actually, two of our advisors were two of the largest people" }, { "speaker": "Speaker 1", "text": "in that space, Frank Giustra and Sean Roosen. And so, they built some of the largest royalty companies in the world." }, { "speaker": "Speaker 1", "text": "And so, for us it's something that's been on our road map for a while. We wanted to start with simpler assets being gold and and silver. And then, sort of expand into that space. But it I" }, { "speaker": "Speaker 1", "text": "think it's something that when you look at it right now for an individual, there's no way for you to participate in that market. And they're some of the most valuable assets. And so, using" }, { "speaker": "Speaker 1", "text": "tokenization to create those is is powerful and something that as we bring on copper and oil and gas, which are the next things as well, um you'll see that in the in the road map." }, { "speaker": "Speaker 1", "text": "How did you guys get like Frank to advise you?" }, { "speaker": "Speaker 1", "text": "I think one, he's he's someone who has supported us for a very long time. And Morgan, my co-founder, has has worked with him." }, { "speaker": "Speaker 1", "text": "And so, we were lucky to be able to to talk to him about it. And he managed to to put in uh you know, his support into the into the project." }, { "speaker": "Speaker 2", "text": "What's the one thing that people should remember from today's conversation?" }, { "speaker": "Speaker 1", "text": "I think one thing that's definitely important is Stream X as a firm, we are creating the future of of commodities and then bringing commodities really into this this new world of of finance" }, { "speaker": "Speaker 1", "text": "and and operating within an industry that is poised to grow absolutely massively while targeting an industry that has one of the largest cams in the world. And so the platform that" }, { "speaker": "Speaker 1", "text": "we created is portable across every commodity asset. It's not just GLDY, it's not just silver. It really is everything and the opportunity for growth is is immense. And I think right now, now" }, { "speaker": "Speaker 1", "text": "that we have the first product launched and we've shown that it's working and are continuing to scale that, our opportunity for growth is is very large and and I am very excited to be able to" }, { "speaker": "Speaker 1", "text": "see what happens in these in these next couple months and I think this month especially is going to be a really exciting one." }, { "speaker": "Speaker 2", "text": "Amazing. Thank you so much, Henry, for doing this. Thank you." }, { "speaker": "Speaker 2", "text": "That was awesome. Very excited [music] to see where this gets. Yeah, me too. Thank you very much." }, { "speaker": "Speaker 1", "text": ">> [music]" } ]