Digital Gold Rush: Tapiero on Navigating A Bullish Crypto Market | Speak Up with Anthony Scaramucci

 

 

Dan Tapiero  00:00

The big wealth that’s been built in this space that has not really come from trading the squiggles. I think the you know, the whole intthe DA ca daca, you know, mentality by a little bit every month, put it away, come back in five to 10 years. I think that’s the way to build wealth. And so you’re saying, Do I think we’re gonna go back down to the 20,000 18,000 lows of Bitcoin? I don’t see it at all.

 

Anthony Scaramucci  00:37

What do you want to get out? Speak up? Is a repeat guest due to popular demand Tapiero that Dan Tapi? Arrow? That that Braille on tap? Okay, so I want to get right into it with you. One month ago, you and I were talking about the early stage approval of the Bitcoin ETF. We are a month into it a little bit more than a month. How do you feel is going down? And what’s your insight? What? What can you provide our viewers and listeners?

 

Dan Tapiero  01:08

Well, I think it’s, we see by the market response, it’s been a fantastic response. I mean, there’s been a lot of shifting as you would expect from greyscale, obviously, because the big difference is enormous. But Americans like to hold their assets in their equity accounts. And, you know, I think many people, especially older investors, would like to see everything on one screen, they like to see, you know, they want to have their robot or report to them on how the, you know, account is doing, they want to be awkward leverage, as well, you know, awkward there off of their overall stock account. So I think for Americans at large is a huge deal. I think the rest of the world, it’s sort of less of a huge deal, you know, a really adult, I don’t see it influencing cryptocurrency owners in Asia or in Europe, let’s say. But what the interesting thing that has happened is that apparently up the global volume, the total global volume in the past, sort of four to six weeks, there’s been an incremental 10% shift towards the US, so that the US uttering us time, Bitcoin, an E that actually become more liquid. And so it’s been interesting, I think, is it’s not just the volume, its app and an increased in ETF. It’s in all the exchanges in all the sellers, etc. So it’s been a time that is lifting all boats and way, it’s sort of surprising to me, but I just saw that data yesterday, that it would be such a big switch 10% is a lot. But so I think it speaks well, right. And I think the ETF is really why eath has been going up as well, because people see the volume, and now they’re saying okay, well, Larry Fink has suggested that they might be bringing the ETF so as you know, markets run ahead, you get a

 

Anthony Scaramucci  03:24

little bit of verbal pushback from Gary Gensler. He was on CNBC, maybe 516 days ago, pushing back on the notion that they’re just going to rubber stamp an E ETF. Now, having said that, they lost the ripple case, they lost the grayscale case. And for viewers and listeners, that ETF decision has to happen by the end of May. What do you think, Dan? Do you think it’s likely that the ETF will get approved?

 

Dan Tapiero  03:52

You know, I can’t give you a specific month? They delayed the Bitcoin DF 10 years or whatever. So I think it will happen this year. I think it will happen this year. i And look, there’s positive momentum, so maybe may have an edge. In the main date, no one was.

 

Anthony Scaramucci  04:19

Rich, I want to I want to step back because you’re one of the world’s legendary macro investors. And I want you to give us a sense for the macro landscape right now. Specifically, I have two underlying questions to the macro landscape. And that’s just guidance on the Federal Reserve. Where do you think they’re going? At? Does it concern you that the top seven stocks in the s&p 500, which are now known as The Magnificent Seven represent about 30% of the s&p 500? Market Capitalization so, so where do you think in the macro, what do you think of rates? Or what do you think s&p concentration?

 

Dan Tapiero  04:58

Yeah, so let’s talk About the macro. First, I think the general backdrop, especially for the cryptocurrency space is positive inflation coming down for the rest of the year. I think growth is held at it better than most would expect. And I think there’s the market pricing of what was it seven fed eases early in the year? You can I think the rates coming down this year, I was not expecting that. So I think there’s a little bit of an extreme. And I’ll select the one that rate hasn’t really moved up yet. It was very low. So the US is hanging in there for now. But we know the real estate sector is sort of plagued especially commercial real estate. And one thing I’m not sure that we were talking about was, you know, there really is weakness overseas. I think the UK, Germany, and I think Japan as well. I think all three registered official recessions in q3 q4, that’s an official recession is two quarters back to back negative GDP, quarter over quarter annual seasonally adjusted annualized rate. That’s how, and if you have two negative quarters back to back, that’s the official definition of recession. So you have three relatively large countries, right, there’s probably around overtake trillion in GDP, just stare in recession. You know, if you’ve been following some of the board stock markets, the Hong Kong Stock market just recently made a 90 year low. I mean, imagine, if you’re on Conger, and you’re looking at the NASDAQ, and it’s an all time high, and your index that a 19 year low. So I think that there are some natural speed bumps global speed bumps out there, China’s been soft as well, the real estate sector continues to be a problem they’re over leveraged many years ago. So even if the US continues to grow at a decent clip, I think there’s some things offsetting that. And that’s probably those are probably things also that will prevent the Fed from, let’s say, surprising and raising again, even if the US were stronger, I just don’t see there enough things out there that are taking the edge off of the growth and the inflation. You know, that maybe last year weren’t there? Right. So I think that’s important for it’s a settled backdrop, I don’t want to say soft landing, we use all these terms, they mean different beings and different people. I do think that the backdrop generally is favorable for the equity markets. And, you know, you asked me about the top seven, I just think about just take any one of those companies, they’re so unique, they’re non replicatable. And that tech, in any cases is being distributed throughout the entire economy. So everybody is using it, or they should be one form or another, you know, tech, one of those companies. And you look at a lot of the the companies in the s&p, again, real estate, banking, utilities, these very old line, you know, say boring businesses, but they’re not really tapping into the potential for growth that these bigger companies can tap into. So I think people, you know, again, I don’t want to cheat guy, you know, and videos up a lot. I don’t, you know, have any specific view about, you know, Nvidia, I think AI bull market is still sort of leading me. Space, the digital ecosystem, as I call it, it’s just started lived off in

the last three or four months. I mean, some of the, the, some of the areas within the space just been exploding Salonica ecosystem has come back to life. Cosmos ecosystem is doing all sorts of interesting things, all sorts of layer twos now on Aetherium, you know, revenues for all of my businesses, as you know, we’ve invested into 24, mid, the later stage companies in the space companies generally making, let’s say, you know, over 40 million revenue, all of my, I would say all of my companies in the world have their best quarter in q1 that they’ve had since the last bull arm. You haven’t seen those numbers yet. You take a look at Coin base. They blew the roof off the numbers, just those numbers that came out a few days ago. And I suspect q1 is going to be even better. I have any edge. They’re liquid. I’m just saying I know The volumes are doing no activity in the spaces. I’d be surprised if they don’t even have a better quarter. That bodes well generally, for the space, the activity has been picking up. And the value now in this digital asset ecosystem is $3 trillion trillion in the value of the trips he’s added. And then another trillion in the value of all the equities in space. So it’s $3 trillion sitting there. It’s still incredible that Gary Gensler thinks that when you’re doing that, it’s your fraud or money, laundry or luminosity. So see, I see the you asked me about the Magnificent Seven. But I see that also connected to our work, right to the, to the companies and businesses that were involved with, because I really do see this digital asset ecosystem, not completely disrupting banking in the old payment rails. But I think growing within that space is not you follow me?

 

Anthony Scaramucci  11:08

So let me Yes, the Gantt chart in question, because I get into this a lot, and I’d love to get your take on it. I’m bullish on the crypto space. I think we’re in early stages. Yeah, I do believe the halving will improve Bitcoin prices. And then you and I both know, that typically filters down into some of the other coins. It’s already filtering into a theory of it’s certainly filtered into salada. But the question that the skeptics often ask me, is, well, what is it that you’re not thinking about? What is it that you are not anticipating that could potentially trigger a correction in the crypto space? And you know, one of the factors that has me worried which I think worries all of us that have been doing this a long time is the consensus around bullishness in. So, you know, you look at the bull meters there, yeah, over a year and the 75 80%. So, now, again, ball meters can be right. And Diane bullish state DEP Oakley, but what if What could go wrong? So,

 

Dan Tapiero  12:15

you know, I’ve been trading involved in markets a very long time. And the one thing that people who are in the markets, even people who are let’s say, they’re in banking, let’s say, but they’re in trading and investing in the markets, often they miss is that markets are discounting. And I think that all that news that you could possibly get dreamed up happen in 2022, when I think you had a low in q4 22. That was relatively obvious. So do I think that there’s a another FTX? Out there? No. Look, I am you know, I’m on the my firm, we’ve got 12 word representation up 12 of our AQR company. So I’m seeing a lot of, you know, the interesting information from the companies. And anyone that is having difficulty is now not. And we were not seeing that three years ago, two years ago, companies that really had tremendous difficulty in the end of 22, for the first half of 23, they cut back, they streamlined, you know, they focused on margins, and now they’re really ripping. And I think that, you know, so you asked me, what could be the bolt out of the blue, I mean, there’s always gonna be a bolt out of the blue. I think if we had a correction in Bitcoin, from 50, down to 40, or something that would be great, or 35 to 40 people out, go sideways for a few months. But I don’t think you know, this to the big wealth that’s been built in this

space, that has not really come from trading the squiggles. I think the you know, the whole into the DA ca daca. You know, mentality, buy a little bit every month, put it away, come back in five to 10 years. I think that’s the way to build wealth. And so you’re saying do I think we’re gonna go back down to the 20,000 18,000 lows of Bitcoin? I don’t see it at all. It’s completely. I think we’re in the second inning of this bull market, so much more concerned and think that they were how homes potentially if I felt we were in the seventh inning, the eighth inning. Well, this census 75 80% I mean, that’s an issue but that may be just means you have Short Term correction. We’re just getting started here. And I can tell you I can see it from the way our companies are performing, how they’re responding and what they live through. I’ll just give you an example one of the companies, I will give you the name, but I mean, they were there, they were threatened with that back sheet, but they were on the breakup video, or they cut back. And they survived. And now actually, the company is moved to profitability in January, are predicting that they would be profitable in December by the end of q1. And it’s happened more quickly, they did more volume in the first 15 days of January in their business than in the previous six months. So that’s not you know, that’s not an end of cycle phenomenon. Right? It’s just starting now.

 

Anthony Scaramucci  16:01

Alright, let’s, let’s go to something a little off the top of the Bitcoin digital assets. But more again, on the macro side. Sure. There, there is fears of what’s going on in China. There’s, you know, potential property. revaluation is going on, I don’t want to say collapses. I don’t know enough about it. But it does feel like there’s revaluations happening in China. I think you and I would both look at the commercial real estate more particularly in the urban centers, and say that they seem to also be at risk, there’s high vacancy rates, could this poll the US into a recession and cause the Fed to move more quickly? Certainly not seven cuts this year. But could they be forced to reverse some as a result of of this stuck?

 

Dan Tapiero  16:54

So I think it’s already happened. Like the fact that a Hong Kong market is pricing is priced at a 19 year low. It’s happened. And the US is where it is. I think China has caused a lot of their own problems. You know, the leadership there is combat and ethically against some of the capitalist leaders. I think a lot of problems come because our capital has been leaving now for several years. I think really, since the moment, Jack Ma disappeared, or a few days or a few weeks, or whatever it was, that was really the moment where large foreign investors started to say, wow, you know, Ali Baba is a fantastic company. Why would the leadership of any country do anything to dissuade that company from being able to grow and prosper? And that was the moment I think, where people like the switch flip. So I think it’s a little bit of a liquidity shortage there. You know, look, it’s a closed economy, they can cut interest rates, they can add liquidity of the currency doesn’t really trade internationally, it’s more or less pegged to the dollar in the euro. So there aren’t necessarily any repercussions for them in debasing the currency, right, by doing excess spending. So I figured that’s what they’ll probably end up doing again, at some point, you know, eventually, maybe they have to pay some Piper. I think the way that they they get penalized, is you have capital flight. I don’t really see it hurting the US, it’s already happened. And the US is still doing just fine. And I just don’t, you know, those linkages, those macro linkages, that I think used to be really tight in the 90s and 2000s, for instance, I just think you’re not as tight anymore. Partly because tech, and the tech is doing something underneath the surface to productivity and efficiency. That is very hard to measure from a macro perspective, macro basis. Like I know, we have productivity

measurements that come out fed releases this official data. But I just I think it’s it’s very hard data to capture. Yeah, I,

 

Anthony Scaramucci  19:31

I appreciate you chiming in on these days, because this is stuff that viewers and listeners, ask us about. And since you were so popular last time, I wanted to bring you back. Let’s go to let’s go to questions I got I got a ton of questions for you. This is from Ken from Oklahoma V. Email. How do I play this upcoming bull market with crypto? Was it be the ETFs or would it be indivision All Stocks what say you? Yeah,

 

Dan Tapiero  20:01

I get asked this question quite a lot. I think there’s only really one stock public company, and that’s Coinbase. And to galaxy as well, is more of Oracle. It’s a smaller company. But if you want to a proxy bet on the space, the entire digital asset ecosystem, I think Coinbase into a crypto blockchain web three digital asset conglomerate, and they watch, you know, they they’ve rolled out their base token, they diversify their revenue from trading revenues, which people two years ago, so Coinbase couldn’t do it. They haven’t been doing it. The leadership there has been very effective, very focused, you know, if you wanted to just only Coinbase and walk away, I think, you know, five years from now, you’d be very happy. Probably even, you know, even during this next bull face, I think he has the ability to double in price from year. You know, I think that’s pretty much that’s an easy call over the next sort of 18 to 36 months. The ETFs are also easy. Again, if that’s what you’re looking for, I think, a investment in Bitcoin and eath, you can go to Coinbase and get a wallet and buy bitcoin and eat through that away. Which is, I mean, I would suggest that because it’ll give you more visibility into some of the different developments going on in the space. I Bitcoin ETF that said, it’s in your stock account, you’re not really learning anything you’re not. You’re not being opened up to some of the new innovations in the space, whereas on Coinbase Apple wallet, you’re also you know, you get opened up to all sorts of information and other cryptocurrencies. I’m not suggesting you need to play other cryptocurrencies. I think Bitcoin and E are the core assets for this world right now. And everything else is essentially a venture project, maybe so long is sort of moving now to a place where between venture and established asset is established just that it’s reaching a network effect. And Metcalfe’s law is kicked in, in terms of how one buys it. I would just as I said, Before, I would buy a little bit, you know, every month, and you know, do that, or, you know, a year. That’s how I would play it. Well, yeah. One of the you

 

Anthony Scaramucci  22:35

know, not not to talk our book at skybridge. But there is a there’s an ETF that we developed with first trust. It’s called the first trust skybridge crypto industry, and digital economy ETF the symbol CRP, T, and Dan, just a couple of holdings in their coin base is a quarter of the old things, but so is things like MicroStrategy and marathon digital. Yeah. So galaxies in their HUD eights, and they’re just another idea for people like that. But again,

 

Dan Tapiero  23:05

I think it’s a I think it’s a good idea. I it’s a little bit coin miner heavy, probably, but it gives you nice diversification. I mean, that’s a nice CTF, I’ve got to write it down. What did you say? What it

Anthony Scaramucci  23:19

says? So it’s C, CR PTK CR, it’s just a way to, you know, we’re getting some institutional demand in there as well. Just a way for people to tap into those markets. Let’s go to the next question. But that’s a great one. The new evergreen venture funds that aggregate hundreds of startups together, see, like the next generation mortgage backed securities, that that will form a bubble and eventually burst. This is from David via email. And so it’s an interesting question. I don’t know how familiar you are with those. I’m happy to chime in here as well. But you are getting these venture funds now that are creating closed end funds, and they’re aggregating small startups. And then, you know, obviously, they’ll make distributions as those start startups mature, potentially IPO or sell and so forth. And what are your thoughts on early stage venture debt?

 

Dan Tapiero  24:15

Well, I always say my venture, you know, the style is you make 10 investments not to go to zero, and hopefully want it to be Google. I think it’s just it should be some small percentage of your portfolio. I’m not, you know, I I’m coming from the macro background. I like to make bets on sectors, bigger bets that are going to move less that you can control the risk on a little bit. So I think 100 year how long are these spots? You say? 100 startups together?

 

Anthony Scaramucci  24:53

Well, yeah, they’re closed. So they tenure? Yeah. Yeah, they had typically 10 year life but they’re all So, you know, they they get listed, and then they can be traded out. But you and I both know that these things have a tendency to trade at discounts with their actual underlying holdings or, and so I think data, you know, for me, I would stay away from this only because it’s very hard to understand. And I think your hunch is right. You know, you could get a bubble rally going there. And you may not be able to get out of these things in terms of where the liquidity is. And so let’s go to the next question. This is an interesting question. This fits into the GBI. Now, how is bullying delivered? And what is the charge for the delivery?

 

Dan Tapiero  25:42

So I’m not up to date, like as of today, but actually a lot of bullying is actually just sent in the mail. I mean, FedEx Believe it or not, I mean, smaller amounts. I’m not sure on much larger amounts, I know that GBI does deliver to I think over 100 different countries. And so, and I think the delivery also, I think tends to be insured as well. It’s a very small extra charge for for delivery. So honestly, these two minutes. But I think it’s very easy. Yeah. What

 

Anthony Scaramucci  26:27

we’ll do is we’ll post the link, you can contact our partner smart asset Alliance. And we’ll post that link below. And they’ll calculate the shipping costs based on value and weight, and, of course, the insurance. But the good news is exactly what Dan is saying, the sets that you want bullion delivered, it can be delivered safely and quickly. And most importantly, it’s it’s short. So you know, excited. Excited to get that question. Actually, let’s go to the next. What is the best most secure crypto cold storage wallet in your opinion, or experience or knowledge? John from Arizona? I’m going to flip it over you you Degas i I’ll just you know very candidly I have all of my my bitcoin at nyttig. Coin base and fidelity. It’s

blended between those, those three. Yeah, and of course I do all in some black rocky island, the Black Rock ETF for the Bitcoin ETF for pure

 

Dan Tapiero  27:31

cold storage. I mean, I would put it on a ledger. You know, I am biased. We have a large investment there. And I do sit on the board. But 75% of the entire hardware wallets, cold storage wallet market is dominated by ledger is another teasels Of course as the other 20% or so. I think Ledger’s be tremendous strides, they’re going to be coming out with a new, a new hardware wallet soon that is going to be a next generation wallets. I would I would look out for that. I think it’s an entity. You know, the the cold storage, let’s say Coinbase, you want to just call it not on the actual exchange. I think that’s more for institutional size fights. I’m not sure. I’m not sure what the limits are. But you can buy a ledger and you can have $100 Bitcoin on there and put it in your pocket, and it’s your fear.

 

Anthony Scaramucci  28:37

That’s why we got you on this show. Daniel, that’s why we got you on the show. Let’s flip over to another question. Oh, good question. I’m gonna I’m gonna see this to you. Sure. And probably, this is you probably have a different view, you know, you have a different view than me. That’s what makes the show fun. Yeah, better for crypto provided. So I just want to point out there but Trump has said repeatedly that he hates Bitcoin, but go ahead. And

 

Dan Tapiero  29:01

but, you know, Trump is the first president in my lifetime that I can remember who even knew where the s&p 500 was. And, you know, as much as I think we probably all, you know, during his presidency, could have used a break from the constant updates on Twitter, etc. He’s very sensitive to the mark, you know, on a great day, it’s, you know, come out said, Hey, we’ve had a great day, the markets up what am I doing? Well, you know, on a bad day, you look around and try to figure out what was going on. It’s very market. He’s capitalist. I don’t want to, you know, get into a debate about all the other stuff that’s in the press and bad, good, whatever it is. So I think he’s generally pro business and pro growth. And, you know, wants America to be a leader in innovation and technology. I think I can say that, but it’s just not present. I mean, he, he really is too old for the office. And I don’t think he even knows that. I mean, he doesn’t know anything about Bitcoin or ether, digital assets. I mean, I’m sure he has people on this team of do. But I just think they’re checked out, fortunately. So there’s no there’s no discussion on this one for me, Anthony. I don’t know what your, your your. Alright,

 

Anthony Scaramucci  30:33

well, you know why? You know why? Because you’re the guest on the show. And I’m pretty sure that anybody that’s listening to this show knows my opinion. I’m gonna leave it there. And you know, as I said, I want to leave it there. Let’s go to the next question. All right, here’s the big one spring training starts this week. Who do you pick to win it all? And why won’t it be the Mets or the Red Sox? Mike from Connecticut date from Boston. They’re in our control room, these two losers, they actually think their team has hope. At least I’m smart enough to know. In the immortal words of Nelson Figaro, the Mets are obviously playing on a Native American burial ground until they get a shaman out there to like spray with holy water or something like that. You know, quote, a sangha is shut down code I send her this

week due to a bad MRI on his elbow. So So I know the Mets are not going to make it these two Oh, plus, sad sack staff B arrow, they think that possibly the Red Sox could make it. And what say you?

 

Dan Tapiero  31:38

Well, I’ve always I’ve been a key fan for a long time. But with a coach that we have now. I’ve been complaining about him for three, four or five years and still don’t want to replace him. I don’t think it’s gonna happen for the Yankees and fortunately, even involuted.

 

Anthony Scaramucci  31:56

What about the Red Sox with the Red Sox?

 

Dan Tapiero  32:00

I just, you know, I’m such an anti Red Sox person. I I can never I don’t think about them. I certainly don’t ever think about them winning. The Mets are a little different. I mean, of course, I worked for Steve Cohen for about 10 years. And I would not underestimate Steve’s ability to build winning wide. He’s a match on this one.

 

Anthony Scaramucci  32:29

I agree with that. But I I want Steve to hire some medicine man to go out there and fix the field though. We’ll just watch and balls drop. I’m watching unexpected injuries. I mean, yeah, we got to do something to change the Mojo. Yeah, but I love Steve. Full disclosure. I’m, you know, our fund has a big investment club employing 72. Yeah,

 

Dan Tapiero  32:50

I think he, you know, he’s a different type of owner. People thought he was just going to come in and spend big, he’s changed his focus a little bit again, I have no specific knowledge here. And I’m, I’m just an outsider watching it. But I didn’t sit next to him on the trading floor for probably about five years in total. So I think she figures out a way to win. And that’s what I would I licks three years, I wouldn’t count them. At least making it to the series. And I know that’s a bold call. Well, let

 

Anthony Scaramucci  33:29

me tell you, it’s a medicine man. Besides music to my ear, ya know, that I’m living for today. I just, I have low expectations now, Dan. It swapped the meds to get there. What the meds to get there before I die. That’s it. That’s all I want. Okay. So I’ve got one of our producers saying the overdrive the Mets is at two and a half over. Under on the sacks is seven 9.5. These are go very far. It’s going to be a long summer. Well, we’ll have to see. But you’re terrific to join us again. And just want to thank everybody for joining us listeners from all over the world. With damp that Tapi arrow today. Speak up with Anthony Scaramucci. Have an awesome weekend. Please send us feedback comment on the show. Send us your ideas. Email us your questions. We’re adaptable. We’re making this show for you. And the deep dive discussions. We’re all learning something very grateful to have your participation. Have a great weekend.