WE HAVE THE CHIEF INVESTMENT OFFICER, MATT HOUGAN, JOINING
US FROM BOSTON. LAYERING ON TOP THE FACT THAT
WE HAVE SEEN THE BRIDGES TO TRADITIONAL BANKING, SILVER
GATE, SIGNATURE HAVING COLLAPSED, THERE'S A LOT OF
CHALLENGES BEFORE WE GET TO THE BULL PART OF THE MARKET YOU ARE
PREDICTING.
>> THERE ABSOLUTELY ARE A LOT OF CHALLENGES. HERE IN THE U.S.
SPECIFICALLY AROUND CRYPTO. THAT IS WHAT SU WAS MENTIONING.
WE ARE SEEING MARKET MAKERS LIKE JUMP EXIT THE CRYPTO
MARKET IN THE U.S. OR MOVING OPERATIONS OFFSHORE.
THERE IS A BIG REGULATORY CRACKDOWN HERE IN THE U.S..
ABROAD, THERE'S A DIFFERENT STORY.
THERE IS REGULATORY PROGRESS IN EUROPE AND THE MIDDLE EAST, IN
HONG KONG AND SINGAPORE, AS PART OF WHAT IS KEEPING THE
CRYPTO MARKET AFLOAT. BUT FOR SURE WE ARE IN A
CHALLENGING PERIOD. I THINK WE WILL EVENTUALLY EXIT
THIS PERIOD WITH NEW RULES AND CLEAR REGULATIONS AND THAT WILL
CONTRIBUTE TO THIS MULTI-YEAR BULL MARKET I AM TALKING ABOUT.
BUT WE HAVE TO GO THROUGH THIS DIFFICULT PERIOD FIRST BEFORE
WE GET TO THE OTHER SIDE.
>> HOW LONG DOES THAT TAKE? YOU ARE RIGHT, WE ARE SEEING
THIS SORT OF GEOGRAPHIC FORCE TAKING PLACE.
HUBS LIKE SINGAPORE, A RENEWED FOCUS ON THE MIDDLE EAST AS
WELL, DO WE SEE A FUTURE WHERE WE SEE THAT INDUSTRY KIND OF
RING FENCE WHEN IT COMES TO CERTAIN MARKETS?
>> HAVE A GREAT DEAL OF CONFIDENCE IN THE U.S.
EVENTUALLY GETTING IT RIGHT AND ADAPTING THE RULES WE NEED TO
MAKE SURE THAT CRYPTO THRIVES HERE.
IT IS A MASSIVELY DISRUPTIVE TECHNOLOGY AND A FAST-GROWING
MARKET. WE WANT IT ON OUR SHORES.
DESPITE THE CHALLENGES WE ARE SEEING AT THE REGULATORY LEVEL
RIGHT NOW, I THINK THERE'S A PATHWAY FORWARD AND THERE IS
BIPARTISAN SUPPORT IN CONGRESS TO GET US THERE.
CHALLENGES, BUT WE WILL WORK THROUGH THEM.
HOW LONG WILL IT TAKE? I SUSPECT WE WILL SEE SIX
MONTHS, NINE MONTHS OF VOLATILITY AND CHOP.
THE BIG SIGNAL TO ME WILL BE, CAN WE GET A PIECE OF CRYPTO
LEGISLATION THROUGH THIS DIVIDED CONGRESS THIS YEAR?
IF WE CAN ACHIEVE THAT, I THINK THAT WILL BE THE FIRST GREEN
SHUTE THAT WE ARE ENTERING THAT PERIOD OF REGULATORY CLARITY IN
THE U.S.. TO ME IT IS A MATTER OF ONE,
NOT IF, BUT THERE IS VOLATILITY IN THE INTERIM. SU:
SOME WOULD SAY THAT COULD BE AN UNDERSTATEMENT.
THERE IS VOLATILITY. LET'S TALK ABOUT THE DIFFICULT
PERIOD YOU'RE TALKING ABOUT. YOU NOT ONLY HAD CRYPTO WINTER
AND THEN A REBOUND IN THE FIRST QUARTER
, BUT THEN YOU HAD THE BANK FAILURES, AND THESE WERE THE
TWO BIGGEST CRYPTO BANKS. HOW DOES THE FACT THAT THE
CRYPTO BANKS ARE AN AREA OF CONCERN AND NOW WALL STREET
EVEN INVESTING IN THIS ASSET CLASS IS AN AREA OF CONCERN
AFFECT YOUR PRODUCTS WHICH EXPOSE PEOPLE TO CRYPTO?
>> IT'S IMPORTANT TO HAVE A LITTLE BIT OF CONTEXT HERE.
WE HAD BANKING BLOWUPS AND REGULATORY CONCERNS, BUT ON
EACH ON THOSE -- EACH OF THOSE MEASURES, WE ARE AT A VASTLY
BETTER PLACE THAN WE WERE THREE OR FOUR YEARS AGO.
THE BANKING INFRASTRUCTURE, EVEN ABSENT, SILICON VALLEY
BANK AND SIGNATURE AND SILVER GATE, IT IS MUCH BETTER THAN IT
WAS IN 2016, 2017, 2018, 2019. I STILL THINK THE TRENDS ARE ON
OUR SIDE. WE HAVE BEEN PROVIDING SAFE
ACCESS TO CRYPTO INVESTMENT PRODUCTS FOR MORE THAN FIVE
YEARS. WE HAVE SEEN BULL AND BEAR
MARKETS BEFORE. I THINK WE ARE IN A MULTI-YEAR
BULL MARKET. IT'S NEVER EASY TO INVEST IN
CRYPTO WHEN IT'S FALLEN A LOT. BUT HISTORICALLY, THOSE ARE THE
PERIODS WHEN FORTUNES HAVE BEEN MADE, AND THE BIT SORTS OUT THE
WAY THAT I THINK IT WILL, WITH REGULATORY PROGRESS, WITH
TECHNOLOGICAL PROGRESS, PEOPLE COULD LOOK BACK ON THIS PERIOD,
THIS VOLATILITY IS AN EXCITING MOMENT TO GET IN. WE WILL SEEK.
-- WILL SEE. SU: ONE OF YOUR PRODUCTS HAD A GOOD
PERFORMANCE IN THE FIRST QUARTER, BUT YOUR FIRM, UNLIKE
BINANCE AND COINBASE, NOT UNDER THE REGULATORY SPOTLIGHT.
CAN YOU COMMENT AT ALL ON THE PREDICAMENT THESE FIRMS ARE IN?
WE KNOW COINBASE HAS SAID THEY WILL USE EVERY PENNY THEY HAVE
TO FIGHT SOME OF THE CRACKDOWN THAT IS COMING THEIR WAY.
>> I THINK IT IS IMPORTANT TO REALIZE THE SECURITIES LAWS AND
THE RULES THAT HAVE BEEN ESTABLISHED ARE NOT FIT FOR
PURPOSE FOR THE CRYPTO INDUSTRY. THEY DON'T WORK WITHIN
BLOCKCHAIN AND THEY DON'T WORK WITHIN CRYPTO ASSETS.
WE NEED NEW RULES AND REGULATIONS.
THAT IS WHY COINBASE IS WILLING TO GO TO THE MAT AND FIGHT IN
THE COURTS, TO FORCE THE REGULARS TO COME UP WITH RULES
THAT WILL HELP THIS INDUSTRY THRIVE. I THINK WE SHOULD ALL BE
ROOTING FOR THAT. AFTER ALL, THIS IS THE
BEST-PERFORMING ASSET CLASS IN THE WORLD OVER THE LAST 3-10
YEARS. ONE OF THE FASTEST GROWING
INDUSTRIES IN THE TECHNOLOGY SPACE. THERE IS A HUGE AMOUNT OF
VENTURE CAPITAL AND HUGE AMOUNT OF INTELLECTUAL CAPACITY MOVING
INTO CRYPTO. WE SHOULD WANT RULES THAT
SUPPORT THAT. AND WE DON'T HAVE THOSE RIGHT
NOW. THAT'S WHY COINBASE IS GOING TO
PUSH FORWARD. I THINK ULTIMATELY, THEY WILL
BE SUCCESSFUL. THEY ARE ASKING FOR REASONABLE
ACCOMMODATIONS THAT WILL ALLOW THE INDUSTRY TO THRIVE.
THE SAME THING THAT THE INTERNET ASKED FOR IN THE
1990'S. THAT IS WHERE WE GOT THE INTERNET BOOM IN THE U.S.
AND NOT IN EUROPE. SU: I HEAR YOU ON THE GOOD STUFF,
WHAT IS THE WILDCARD IN YOUR VIEW, AND 10 SECONDS, FOR YOUR
INDUSTRY RIGHT NOW?
>> THE EXTREME RISK WOULD BE A VERY HARSH REGULATORY CRACKDOWN
AND NO CHANGES OR ADAPTATIONS TO THE RULE.