Galaxy Digital Inc. (GLXY) Earnings Call Transcript & Summary

It's really cool to have Mike from Galaxy. We've talked a couple of times on video. So this is the first time I'm seeing in person. As you guys know, we launched coverage of this space about 2 years ago. We probably put out about 110 reports in the last 2 years, and we have our weekly web sessions really talking about different aspects of this ecosystem for digital assets. But what's really nice is actually Mike can talk about all of it since he's been involved as from very early days as well as what Galaxy does. So first, thank you, Mike.

Thank you.

Maybe first, we can start off with, let's just talk about Galaxy itself. I think you found in 2018. So what created and what is Galaxy right now?

Sure. Well, thank you. So Galaxy is a public company in Canada that was started with the idea that we would be a bridge between this crypto universe and institutions. And so we always took an institutional DNA in the way we approach transparency and compliance and how we dealt with our counterparties. We have 3 big business lines. One is our markets business, which feels like a traditional sales and trading business at an investment bank. We've got an investment banking business that does advisory. But it's lending derivatives, it's connecting liquidity to 850 counterparties and try to provide them ideas and service. We think that will get accelerated in the second half of this year as we're rolling out GalaxyOne. It's our automated prime offering. We think it'd be the best prime offering in the space where we connect all the liquidity we see and all the different custodians to these customers to kind of make it one-stop shopping. That's been a profitable business for us. We've recently benefited from the demise of about 80% of our competitors. Our biggest competitor was Genesis over very sober shop, and they ran until buzz saw. They were probably 4 to 5x the size of us. I always scratched my head and they were 4 to 5x the size us because they were taking immense risk on their credit book and you give people credit and they'll trade with you. And so the market has certainly pulled back in terms of risk tolerance and that's benefited us. Our second business is asset management, where we manage other people's money. It's a $2-plus billion AUM. That needs to grow for us. We have about half of that in venture-type funds, which are high fee paying and half of that in either index product or beta product through partnerships with Itau and CI Group, Itau in Brazil, CI Group in Canada. So we're using kind of a partnership model to scale the lower fee stuff. A big focus there. Traditionally, we had taken a ton of risk on our balance sheet and both our venture portfolio and our overall claim portfolio, probably was a top 5% crypto portfolio in dollars in the $2.8 billion after tax after compensation after running the business from low to high. That number as of last earnings was about $1.7 billion. If I had to do it over again, that would have been in the asset management business, and we have taken the fees on it instead of having the balance sheet run up and down. And so we have a big balance sheet. We're starting to shift that investing in that talent into the asset management bucket. Hopefully, over time, you have less volatility of our earnings and more fee earnings from fee and promote from asset management. And our third is Infrastructure Solutions. We have a big mining operation or we are building a big mining operation down in Texas. We bought a custody company called GKA out of Israel. And so we'll be able to provide solutions for qualified custodians. It's really a software business, you want to think about it. We're doing market making as a service offshore and starting to look into the validator business as well. And so we think that where you build the infrastructure for the space will be a great business. And you put them together, there's a lot of diversity. And again, there's a big balance sheet that we've invested well.

Good. So maybe we can talk a little bit about customer composition, right? So you're headquartered in Canada. And so how does that affect customer base? And is it family offices? Is it hedge funds? Are you seeing asset managers? Just what is the customer base composition?

So if you think about where crypto started, It started with 99% retail. And maybe I was a knucklehead for not hanging a retail shingle up early on. I had this idea that the herd would come that institutions would come. And it took about a lot longer than we thought it would. As a matter fact, wasn't until post COVID that they started showing up. So our biggest customer base originally and continues to be big, were crypto companies. Crypto companies that raised money and protocol companies, crypto hedge funds, crypto venture companies, right, providing services to those companies. That's where our banking business thrives and a lot of our trading. And then you saw family offices and hedge funds, right? Every macro fund now trades crypto. And a lot of the TradeFi multi-strats Brevan Howard types are creating crypto pods. And so a lot of the talent that was in the crypto [indiscernible] that blew up are starting to repod themselves in traditional hedge funds. And so you're seeing a migration. And so us covering all those is really important. We know those from our previous lives. Our Board Chair, Michael Daffey, was Goldman Sachs' Head of hedge fund coverage for 25 years. And so there's not a hedge fund that we don't have access to. You were starting to see endowments, pensions, in the U.S. and in Canada, that's slowed a lot post Sam Bankman-Fried, people just felt stupid after that, right? If you think about the 2 of the biggest Canadian pensions, one put $300 million into Celsius and one put $400 million into FTX and the money was 0, literally 3 months after they made the investment with their pensioners' money. And so it's going to take a lot of courage for the next Canadian pension fund guy to say, "Hey, let me get in there." And so that part of the business, I think, is slowing. But there was a lot of people that got to the 1 yard line and did invest and then saw the world blow up and now are saying, "Hey, this is my opportunity." And what we've been seeing since the beginning of the year is crypto goes from 16,000 to whatever, 23,500 right now. 16%, 23.5%, 45% up. I should have bought the lows. And what has always worked in crypto is price begets interest. Why did it rally because everyone that needed to sell had sold because there was no leverage in the system, and there was the quintessential blood on the streets. And China, Xi Jinping, after his people started protesting zero COVID and zero [indiscernible], right, that big spontaneous protest, he pivoted to COVID's over and regulation is going to be scaled back against tech and crypto. And so you're starting to see the Chinese crypto market [ thaw ]. You're seeing those trade by hedge funds I talked about, hey, they're just getting started, buying. You saw short covering. And now you see lots of new interest in Europe, we were talking about before, there are a lot of phone calls ringing in Europe. Again, you're not seeing big institutions putting in checks, but everyone wants to figure out how to get involved. There's not an asset manager we speak to here in the U.S. that isn't wildly focused on tokenization. So there's some pieces of the crypto ecosystem. If it's tokenization or stable coins or Bitcoin or rewards program, if you look at Starbucks, that is a MasterCard now doing all of their purchases on blockchains, creating tokens per purchase. And so this idea that blockchains relate the world and that tokenization is coming. And as you blend crypto in one big basket, everyone's got some interest. It's not all the same interest, right? And let me tell you, there's no real stick in tokenization yet, but 5 of the biggest financial institutions in the world have been in our office in the last 6 weeks talking about tokenization, how they can get engaged. No one wants to miss it. And so that overall energy, I'm positive, crypto is not going away. The government is trying to, they call it operations show point to I think the Democratic party felt so stupid after FTX, like the #1 donor. I make the joke that Sam was sitting on Biden's lap for Christmas pictures. And I'm a Democrat. That they've backed away. And it's given the regulators kind of [ car plunge ] to go after crypto, Elizabeth Warren hates crypto, she keeps putting in bills to say crypto should be illegal, which is weird because it's very progressive, and Gensler is on this [indiscernible]. And so even with that, if you think about every crypto company is getting subpoenas and Well's notices and Paxos is run by a guy, [ Chad Pascal ], who is a good friend of mine. I literally just given their company keynote. They were all excited. 9 days ago, and within 9 days, New York DFS kind of shuts them down and they get a Wells notice he runs an unbelievably straight liaised compliant system. And so there is an attack. There's an attack on CZ. Everyone's worried that he's some sinister guy. Really, in my gut feeling stems from the fact that everyone got fooled by this kid in Bermuda shorts. And they feel stupid. I talk to Tim Adams, who runs the IIF. IIF is International Institute of Finance. And it's got Chairman Paul as a member. Central Bank governors, bank CEOs and had 2 crypto members, Brian Armstrong and Sam. And I guess we gave their keynote 2 weeks before FTX blew up, Sam. And so they feel stupid. And so this, the Sam Bankman-Fried thinking went so much deeper in the institutional world and in the official world than a normal blow up. And so a lot of this is a reaction to that. This too shall pass. And the technology is plowing ahead. We're not seeing any slowdown in the amount of young kids that want to get into these ecosystems. I said publicly recently, crypto will come back because retail will bring it back. It has always been a retail product first, right? People see this as their ecosystem. They've been left out of finance. They are either younger people or people that felt left out, and you're seeing them come back. And that's sucking institutions. So it's a really interesting dynamic. I think this is going to be a hard year for institutions. For Galaxy, we're going to grind it through and build, build, build. It doesn't mean I think prices will go up. But I think getting the institutional adoption is still, everyone's still a little tentative. The rules are less clear. I don't think you have anything horrible come out of D.C. in terms of legislature. The Republicans are pretty procrypto and the Head of the Health Services Committee really procrypto. The majority whip, Tom Emmer, he seems to like just a beat on Gary Gensler for sport. But for crypto, they're going to hold the SEC accountable as much as they can in their watchdog role. I don't think you get legislation because even though the Senate and the Democratic center was really moving towards procrypto, it just doesn't feel like it's right for them at this point anymore because of the Sam thing. And so you probably get stalemate and Gensler is going to push as hard as he can.

So I want to follow up a little bit more on the regulatory and what D.C., but also other countries might do. But before we hit that, you had mentioned that your customer base starts with a lot of crypto-native companies. And we're hearing the same thing and seeing the same thing. A lot of the crypto-native funds that I talk to are landing in traditional funds. And they're actually raising money from the pension plans and endowments as part of the alternative investment bucket. And so because crypto is not going to pass their risk committees now. What does your pipeline look like in terms of institutions that are coming to you and how fast it is to open an account with them?

Well, so we have different pipelines, right? So we have a pipeline for businesses that we trade with, trade, lend to. That pipeline is robust. And so let's pick on Alan Howard because he is a friend of mine. Like they set up a $1 billion cryptomultistrat. How was Alan able to raise $1 billion for cryptomultistrat? Because he made a ton of money for people in his other multistrat. And so it was the same investors, hired some smart guys, hired one guy from us. And always hired my son as well. They're going to have an easier time raising money than multi-coin, who was down 80% and so if you're going to put money in, it's going to end up going to something that used to look like TradeFi because people say, well, they understand risk. And so I do think the wrapper of where crypto gets done, will look more like traditional hedge funds than it did these hedge funds that came out of nowhere. Arca and MultiCoin and 3 Arrows Cap. These guys were run by young guys, they had spectacular ups and they had spectacular burnouts, sometimes in fraud, sometimes just terrible risk management. I don't think that stops him from investing. I just think they're going to invest in people, they consider safe pair of hands.

And so given those teams, many of them have actually worked with you in the past, although they're just on a new platform, does that bring business to you?

So that should bring business to us. In some ways, it's easier to deal with people that we've known from the previous lives. That said, the key person in each of those places is not the PM or the trader, it's the COO. And so this is really an operational due diligence gain for our team to sign people up. If you're a millennium, if you're whoever, it's your pipes, your custody, and so we have a pretty big balance sheet, I wish it was bigger, right? Because you're getting people to trust to deal with you. And so we're in a better shape. We are in better shape than any other crypto company in doing that. And right now, we have the advantage that the Goldmans and the Citi banks can only really offer futures product. But there are plenty of hedge funds that are like, okay, we'll just do futures product until they get more comfortable with us. And so for us, it's a hand-to-hand combat job of working with their credit side and working with their COOs, really, their operations, the ODD side. Now the good news is we know how to do that. But it doesn't scale like this. It's a linear scaling job. And so you pick the biggest guys and you go after them.

Glad you left out of [indiscernible] when you talk Trade Desk... although we do trade futures. So I want to go into the different trends and themes in each of your businesses because it really just captures a lot of the ecosystem. But before we do that, given all the regulatory and enforcement and all the stuff that's happening, and we don't have to go through what happened really last year because I think we've already talked about that. But really, do you care most about what happens from a regulatory legislation perspective in the U.S.? Or does what happens in the EU, what happens in Singapore, Hong Kong, does that help you, hurt you...

I was just talking with one of the bigger crypto players before I walked in here, he was like we will never even think of dealing in the U.S. anymore. He was like screw those people. And there's most crypto happens outside the U.S., right? So every company like ours, we have an offshore operation, it's getting bigger, and I foresee it getting a lot bigger. So the U.S. partly because we're stuck until the next election and who knows who wins the next election. I'm sure like [indiscernible] at this point. We don't see a lot of clarity in the U.S. I think the U.S. is by far the most important in the long run. The long arm of the U.S. law is really long. And so we are working with the regulators with legislators to try to make sure we don't do stupid stuff. As a patriotic American, like if we screw the Stablecoin thing up, which we could, it's a disaster. I guess [indiscernible] about this. I was like, we have the largest deficit in the history of humanity to fund. People are moving from paper money to digital money around the world at record pace. Traditionally, there are more $100 bills kept in pillow cases in places like Lagos, Nigeria, Bogota Colombia, China, then there are $1 bills in circulation, right? The dollar has been the reserve currency of the world than it has been often not in the banking system. And now you're going to allow all that to go digital, you like a lot them, put them into the renminbi or put it into the euro, like we're frantically working on a euro-stable point proposition with partners. Like the volatility between the dollar, the renminbi and the euro is nothing compared to the volatility of most of the developing world currencies. And so if you're in [indiscernible], you don't really care if it's dollar or renminbi or a euro, it's stable relative to your currency or in I mean if you look at the 185 countries, 2/3 have currencies that depreciate more than 15% a year. And so Bitcoin itself or Stablecoins are a lifeblood. It's a human right in some ways to have something to preserve your hard earned wealth in. That story is not going away. Why people love Bitcoin because Bitcoin is that thing because it's got no inflation. To be fair, most people in [indiscernible] to keep picking on Nigeria, I can pick on Tanzania, I can pick on, you name it, Venezuela, Argentina, with still rather dollar rise, right? They still trust the U.S. dollar. If they can't get the dollar, they certainly would take Bitcoin. And if you start losing faith in the dollar because our politicians can't balance their own checkbook, we're going to have a debt show down, the debt ceilings show down. At the end of the year, we had that omnibus builder just jam everything in one bill and there's just so much ship that gets in that bill. And so there's no sense of fiscal prudency. Chairman Powell has showed up as a [indiscernible] character all of a sudden. And one of the reasons Bitcoin came from 60,000 to 16,000, was the Fed showed up as a real steward of an economy. But you need 2 stewards of an economy. You need a Fed and a treasury. And the treasury of [indiscernible] is converse. And if both of those don't act in unison to over time have rational fiscal policy, a rational economic policy, currency depreciates. That's the Bitcoin argument that there's almost no way in political world in this populous world, we'll ever balance our budget again. right? We have a booming economy right now, right, lowest unemployment in 60 years, and we're hoping for a 5% budget deficit. 5% budget used to be the crises, the red lights flashing. I remember when I worked at the White House in 1984, Final regulars 5% budget deficit, and that's all in what we talk about. Now that's the floor. And so that's the Bitcoin story, but the reality is that's a slow-moving gain, and I pray it slow moving gain. I don't want the dollar to plummet for all our stake, right? Countries where the currency plummets, you lose civil society. And so Stablecoins is the answer for lots of people around the world. And they are less concerned, right? Right now, the #1 stablecoin in the world is tether. It's a fine stablecoin. It's probably back, it's not as regulated. It's run by guys that you might not want to do business with. But if you're an emerging market guy, they use tether and they move it around on tran, which is a centralized blockchain run by a Chinese guy named Justin Sun because it's cheap. And so my argument to the government and to lots of people is there's a huge opportunity for the dollar stablecoin, if it's Jeremy Allaire at Circle if it's a variety of stablecoins to be the dominant payment system in the world, that's how you fund your deficit. And if we screw it up, it's got, I think, national security implications. But that's what the Chinese are playing for. they are already with theirs, you go to mid-east, you see them all the Alipay and WeChat signs everywhere. And that's their access point for the digital renminbi. And so we'll see how it goes. I'm nervous frustratingly enough, there was decent stablecoin legislation on the floor right before Sam. And so we'll see what comes back.

I want to talk about saves more, but before we hit that. So I'm a strategist with the research. I don't actually cover companies. I have no adviser sales. But that also means I spend most of my time with private companies, especially in this space. And what's interesting is, so I've talked to probably about 40 companies in the last 3 weeks and the consensus I'm getting is the ones that are touching trading, the view is nothing is going to happen in the U.S. this year, I thought it's similar to what you just said. The ones that are building applications on top, sort of like the MoonPays and those guys, they actually are super excited. They're not being affected by the trading. There's a little, the fact that they don't call it NFT anymore. So it's all collectibles and stuff, and they're able to offer things that actually are building on this. Their pipeline has grown significantly, and projects have grown significantly. So how does the 2 of those pieces work?

Gensler would love to regulate the NFT market as well. But like people get in those positions and they just love to be the Czar, everything through me. And so smart not to call them NFTs. I think NFTs are going to revolutionize every the way companies interact with consumers. And so most entities will be given away for free. They will not be sold. They will not be people $69 million NFT or even we're part of Candy, we sell digital collectibles for the MLB and Major League Baseball. It was just a WWE a couple of nights ago where we're doing them, and I met the 7-foot 5 Nigerian Giant, the biggest man ever met, like there will be a niche for NFTs that people collect for a variety of reasons. But most in some ways, are going to replace the cookie. You're going to opt in and you're going to give your information to people through this new technology platform. And it's going to be an opt-in, not going to be the way we do it with, hey, we take this cookie. They do this all time I like say, no more cookies. And then I start pulling website and they're like, well, we accept these cookies or you can use the website. That's going to shift to an NFT-like platform, and we're seeing some of our interactive funds. So amazing starts to things. And so I do think the MoonPay idea [ unramping ] in that world is going to change how, just to remember, most of us live in Web 2.0, and we live in a mostly physical world. But on Sunday, I decided a no-phone day and that met, I was only down to 1 and 15 minutes of screen time. it's the lowest I've had by 3 hours in over a year. I average 5.5 to 7 hours of screen time and I thought that's so embarrassing until I grab my kids phones and they're higher. And if you just look by age, screen time goes up. So you think about we're moving more and more into a digital world. And in a digital world, digital private property value currency. I mean, if you think of the Satoshi's break that was he gave his digital private property. There was no private property on the Internet until there was a blockchain, right? You had an Internet that was futile, and there's no capitalist without private property, there's no freedom without private property. And so Satoshi gave us private property, and you're going to see that show up in so many ways. NFTs is the easiest version in some ways. And so you're going to see these ecosystems built out. And then you're going to see the AR piece come in VR piece come in. So as we live in this hybrid world, I think you're a young chess player in Montgomery, Alabama, your friends are not in Montgomery, Alabama. They are in Russia and in India. And right now, it used to you just tied to them on all of a sudden, you can meet them in Chessland and your avatar is talking to their avatars. And that's starting to happen. It's the technology is just getting there. multiplayer technology on large scale is getting there. And so media companies, music companies, sports companies, how do you create these environments that people interactive. Even at Candy, we're doing ticketing for MLB games. And all of a sudden, you get amazing data and so you've got to be careful because the whole idea of Web 3 is you don't steal people's data. And so where does your ethos go? But this technology is going to be a data collection technology.

Yes. It's interesting stuff at Candy. I want to go back to Stablecoins. So it seems like that is the other consensus view that if anything passes in the U.S., it will be the Stablecoin bill. Do you care whether it's a dollar backed Stablecoin, a euro backed Stablecoin as to what's happening? I mean with Chad out the Paxos buying that Stablecoin, you have the shift of most of the financed stuff going to Tether, right? It's not going to Jeremy at Circle. So Tether is certainly becoming stronger. They're dollar backed today, they want to do euro. But does it matter to you? And does it matter to...

Listen, it matters to me as an American who served in the army, we like walk to me opening same as the Olympics. I worn breaking USA flag on my chest, my whole life, and so it's infuriating to me. As a crypto technologist, it does matter, right? It really doesn't. The euro is a pretty stable currency. Roughly, if I look at the volatility between the dollar and the euro over 20 years, it doesn't move that much. And so it's giving people in the developing world access to something that they want. I think it'd even be a crime if we don't have our own Stablecoin in the U.S.. And so I actually have a call with Jeremy this afternoon. How do we help in some ways? Here's a stat that most people don't understand. Last year, 2022, Stablecoin settlements, $7 trillion. Visa, $2 trillion, Mastercard, $2 trillion. Stablecoins were more than Mastercard and Visa combined. It's not a complete apples-to-apples by any stretch, but these are not small ecosystems anymore. This is money moving around. And we don't, everyone here probably has ApplePay. It's awesome, right? We don't really need Stablecoins in the U.S. for wealth, we have ApplePay. And they don't cross that bad, we don't think, and Apple's pretty good on privacy. But the rest of the world doesn't, and so it's a lifeline for people, sending money back and forth from your crappy construction job in Qatar or Dubai and your relatives are in Bangladesh, that process of moving money. Everyone wants to do it cheaper and more efficiently micro payments. All of that is happening around the world. And so we can be too myopic looking at it from a U.S. perspective. In the U.S., why are people pushing for Stablecoins? It's settlement, it's 24/7. It's efficiency. It's mostly not payments.

TCC came out about 3 months ago and said about $2.5 trillion globally would be freed up if you could have a wholesale CBDC or an approved Stablecoin, just from banks with windows to the central banks. So $2.5 trillion is also real collateral money.

Shocking. What's complicated with CBDCs to Stablecoins in that whole, let's say, spectrum of where we want to end up is that it cuts to privacy. And I tell this story, which is kind of aggressive, and I probably shouldn't tell it... I tell in any way.

It's just us.

I was on a phone call with the Brazilian Central Bank governor, who was a lovely guy, and I've known for a long time. And a bunch of people, they were talking about doing this BDC. This was early on in their process. And to try to be provocative and an ass, I said, well, I'm Googling your President, and he really doesn't like gay people. There are 29 pages straight about how much Bolsonaro doesn't like gay people. And so if you're a gay citizen of Brazil, you feel really uncomfortable if your government had all your spending data because they would know instantly your day by AI. And so what are you going to tell your gay constituents... He looks like? I can ask that question. I don't open Zoom. And I was like, so where do you draw the line of privacy, right? China, for their citizens, there is no line. Their citizens decided to give up full privacy that's part of their back with their government. That's not the American way. It's not really the Western way. And so if you're a Central Bank governor, he was at that point, thinking if I have all this pricing data, my decisions on the economy are so much more effective, right? I know in live time what people are spending, we wait months for these reports on consumer spending on CPI. I know lifetime on inflation. And he's like, I'll have the greatest dashboard in the world. I said, "Well, yes, but how do you protect people? And so there's technology in a simple word, the more decentralized the blockchain is, right, run a Stablecoin on a Ethereum, it's going to have more privacy than centralized version, right? And so how do we find that balancing? We all will agree that kitty porn and tariffs financing are pretty s***** things, and we should stop them. And so where is the trade-off between, I need to see all your transactions and where they're going and your privacy. And sorting that out is a really nuanced gain and a game that doesn't do well in public politics, but that's what's at stake here. And we all think our data is not that important, right? We've given away our data our lives. But we never thought we'd be in a country where half the country, literally half the country didn't trust Donald Trump, one iota, and thought, "Oh my God, if he has all my data. I'm nervous." And the other half doesn't trust the other side. right? In Brazil, you're seeing the same thing. And so when you had cohesion amongst a country Iceland voluntarily gave all their DNA to their government for a study. So every single citizen license... Yes, have by DNA. So the government of Iceland, they know who's got chronic illnesses, they know well, that's really dangerous information. It's in really s***** hands. Hey, all these people that we get type 2 diabetes, let's just tax them, or let's just kill them like the bizarre thoughts that, that power gives somebody. And so data is power. And now that we can process data the way we can, it is a shocking amount of power. And so what the blockchain does and you see this in the Stablecoin debate is allows you to say enough. And we're getting close to the technology is not there, but zero-knowledge proof. There's this curve that all these smart guys are pushing us up. They're going to really allow limited data to go. You get to know on a need to know basis what you need to know. I use this example. My daughter used to go to the bar and give her ID card, and she was 21, so she could drink, but it also gave her height, weight and address. And so the bar tender was, "Oh, you're right around the corner." Why are you giving the bartender the address, right? That's just stupid. And so that idea of giving people the information they need, given governments the information they need, the technology is close there. But these decisions are being made and they're not necessarily being fully thought through. And so that's what's at stake.

So I have lots more on market structure, custody, your prime business, deals on energy, you're getting in Texas, but we're not going to talk about that today. I'd like to ask you what do you think the outlook for just sort of token prices, given where we've gone just in the last 5 weeks...

We have had an amazingly strong rally. I gave you some reasons why I thought it was happening. I am surprised to be fair, like I said, all you shouldn't sell like but I'm surprised at the velocity of it. We see some of the money coming in, like I said, the TradeFi hedge funds are getting engaged, but we don't see all of it. We're not a retail shop, and we're not in Asia, nearly enough. When I look at the price action, when I look at the excitement of the customers calling the [ fomo ] building up, it wouldn't surprise me if we were at 30,000 by the end of the quarter. And I would have given both my shoes for that to be true just 6 weeks ago. Like roughly end of the year at 30,000, I'll be the happiest guy will give us time to kind of fix our stuff and build out and really have a great company. I just didn't want 10,000. And so in crypto, price begets interest, right? These are ecosystems have shared value. And so all of a sudden, you're a bitcoin or you're puffing your chest a little more into telling your friend and you're telling your friend and you're telling your friend, and that has created these cycles. The having tackle start in a few months. And so it's really hard to know where these things end. What makes me skeptical that we can have the explosive back to the old highs this year is Chairman Powell has become a tough son of a bitch like he really is doing what he says he's going to do. And I don't see the Fed pivoting and cutting anytime soon. And so we're going to have Hawkish Fed policy. And with 5%, 5.5% short rates we got $100 million, $5.5 million a year in interest. It's a much bigger hurdle to take a flyer on stuff.

On a risk asset...

So risk assets. I mean, again, one of the things that I think is I want to scream loud and clear because you're [indiscernible] got on TV and was s******* all over crypto again. And we did some real quantitative analysis of Ethereum and Bitcoin versus you name the stock, Google, Microsoft, Tesla, JPMorgan from pre-COVID to the high from the high to the low from 3 years ago, 2 years ago, and we've all adjusted it. And we were even so geeky that we've all adjusted it using longer day count for the crypto since they trade 365 days a year. Ethereum on every single time zone has been the single best investment on every one we use, 3 years, 2 years, pre-COVID, post-COVID, ball adjusted. Bitcoin has been second or third. Tesla, believe it or not, is the only other thing that compared. And so these have been great investments even in a time of abuse, right, at time of fraud and excessive speculation. If you look at Zoom, which we use Zoom every [indiscernible] day. Zoom rallied about as much as Bitcoin. It's fair to come back from its lows, unless I have looked at it in the last 2 weeks. Bitcoin's, at this point, it's 3x from where it was pre-COVID. And so you've made 300% being in Bitcoin if you bought at the day before COVID and you made nothing in Zoom. And so while it feels like we've had this [indiscernible] the adoption of crypto continues. The spread of this crypto idea continues. More and more people believe in it. And so you've got to step back a little bit and look at that trend. It's kind of shocking actually that because you would have thought this has been the worst period for crypto that you can imagine. I mean, we had BlockFi and Celsius and 3 Arrows, like it was a brick and rogue gallery rogues. And even with all that, we're at better vibrancy.

Well, good. That was great. Thank you, Mike. Thanks, everybody.

Thanks a lot.