Unraveling Bitcoin's Record-Breaking Spot ETFs with Eric Balchunas

Bitcoin ETFs did billions um they've already surpassed if you if you just look at like the first month or the first six weeks you know we're about week seven I think if you stack them up on any measurement they blow everything away um at this point you could probably find something in there like oh if we look at the first two weeks and we X Out gbtc technically and we infl adjust for inflation technically GLD actually was tied like there are ways to maybe find a spot in the 7 we weeks where it w

asn't Earth shattering but if you go one week one day 4 weeks 6 weeks 7 weeks you look at volume assets flows post gbtc X whatever you want to do you're going to find they blow away every other new launch record this content is brought to you by uphold which is a great crypto platform that I've been using since 2018 uphold has all the top cryptocurrencies Bitcoin and all the altcoins in fact they have 260 Plus cryptocurrencies on their platform you can also trade precious metals stable coins and

37 Fiat currencies in addition they are available in over 150 countries and this platform is fully reserved they do audits so you can trust that your funds are safe no comingling no lending out your funds if you'd like to learn more about uphold please visit the link in the description welcome back to the thinking cryto podcast your home for cryptocurrency news and interviews with me today is Eric balunis who's a senior ETF Analyst at Bloomberg Eric welcome good to be with you Eric I followed y

ou and James saford on uh Twitter of course or what Elon calls X now and I appreciate all the great data you've been putting out there about the Bitcoin ETFs and we got a lot to talk about uh but let's start with your background where you from and what's your professional background my background uh so I was trained as a journalist communication at Ruckers uh did that uh work for institutional uh investor magazine which is a magazine aimed at pensions and Investments wrote about mutual funds the

re back in the 90s when they were like the hot thing and then um moved to Bloomberg which to me was the crem de La Creme of business journalism and there I actually joined the pr team and did that for a while uh which was uh really good I get to see a lot of parts of Bloomberg and after 9/11 I moved back to South Jersey and worked at in their data office cuz it was in Princeton so I just happen to geographically need to work in Jersey and that's all they did so I I'm like a reporter who got dump

ed into the data group and I at first I hated it I'm like this is this is awful especially compared to PR and journalism which is more exciting in journalism and PR you're a mile wide but an inch deep but I like that I like to move around I'm a fan of novelty in data you're more a mile deep and an inch wide and um it actually was the best thing for me because it I got to spend time really working on problems and in the data uh I helped build some tool tools on Bloomberg to uh track different thi

ngs and in 2007 is I got handed ETFs as a data responsibility and so as a person who tracked mutual funds I was like holy moly these are really an evolutionary Marvel um I you know it had to be like what seeing the MP3 was like for a music person you're like wait a second this is going to revolutionize everything and it did and so I dedicated my whole career to it and became like the ETF data guy and I got recruited by research so Bloomberg uh started a research group they did stocks bonds and t

he guy running it saw me doing some like media here and there and um just gu was known as the ETF person he said why don't you write about ETS for us and I did and I've been there eight years and so I lead a team of about uh 10 11 people uh who do ETF and a little mutual fund research and we published on the Bloomberg terminal and obviously that's Bitcoin ETFs is the flavor of the month topic for us right now absolutely now you also wrote two books right can you tell us about that yeah one of th

em's behind me uh I am no I shamelessly promote it because you know when you're a small publisher it's not like your stuffs on billboards and stuff so one of them is called the Bogle effect which is about the Vanguard founder Jack Bogle just the really in my opinion the most impactful human being in the investing landscape if you read the book you'll see why but he brought all the fees lower the reason I bit is 20 basis points or 25 whatever it is and the reason those Bitcoin ETFs all had that m

assive fee War even though Vanguard wasn't involved their spear was they created what I call the ETF pter and because everyone loves low fees that's why ETFs are so popular and you take Vanguard and Bogle away they're going to be a lot higher less growth they're the core of everything uh that that you see happening namely low fees and indexing um anyway the other book I wrote before that was called the institutional ETF toolbox if you're in crypto and you want to learn just about ETFs that's a g

ood primer on ETFs tells you mechanics creation Redemption I go into all the different asset classes uh so this is a is a little bit more of a wider look out because ETFs are one chapter in that book then I have a whole ETF book so I think for a crypto person who's just really curious about learning ETF mechanics the first book is probably the better one again um and I'd be grateful if you were were interested but um you won't be let down they're good books uh I work really hard on them and they

basically all my knowledge is in both of them I will be sure to link those on the website and in the description of the podcast everyone check that out Eric you know you brought up a Vanguard and I want to get your thoughts given that you know their pedigree and how they view the markets but they've taken the contrarian view on bitcoin why do you think they are still on the fence yeah so um it's just That's just How They Roll it's on brand so Vanguard let's face it Bitcoin is a little like a ra

ted R movie for most people for normal people like take your parents right if Bitcoin were a movie it'd be Quinton Tarantino it would not be Disney okay Vanguard just does Disney they don't do the crazy stuff they don't allow leverage ETFs on their platform uh they do allow gold but they don't like it um they are a meat and potatoes kind of company familyfriendly 6040 and this in my book uh on Bogle I interviewed him many times and I also asked him about Bitcoin and he had nothing personal again

st it although I do think the spirit of disintermediation is huge with him and bitcoiners there's a lot of overlap which is why I asked Matt Hogan from bitwise to write the forward to that book cuz he's an ETF guy who works heavily in crypto now and I thought he could bridge the gap between the old fogy mutual fund world and Bogle and sort of connect him to the disintermediation movement that Bitcoin has and I think he did a great job but there bogle's problem with commodities was that it's only

worth what someone will pay for it in the future whereas a stock is a company and a company has people who go there every day wake up create value that value turns into sales which turns into cash flow which turns into dividends to you so even if the price does nothing and there's no speculation you get paid the money works for you a bond you get a interest rate a coupon payment so stocks and bonds the money does work for you regardless of speculative return He argued Commodities are just pure

speculative return there is no underlying thing now bitcoiners will say well there's there are people creating value in Bitcoin fine I'm not I'm not bogal I'm just telling you what he would say and what Vanguard thinks and I think people inside Vanguard aren't happy about that decision I think some might be some might not I personally think that it's a little nanny staish of them they should just trust their own investors to make decisions um if you found Vanguard and you are a Vanguard person b

ecause they don't pay uh intermediary so you had to find Vanguard so if you found Vanguard you're definitely into lowcost and the bogal ism you're probably not going to be the person who swayed and going to put all their money in Bitcoin that's just not who are so there's no harm I think in them putting it on on their on their site whereas You could argue like putting big advertisements on Robin Hood for the new Bitcoin ETFs could be a little risky because people are just going to go crazy there

so I just think they shouldn't have done it and I do think they'll Lighten Up Overtime because they have an advisory uh service so they don't only offer funds they also will advise you on all your money like your estate planning your taxes and if you're an adviser you kind of need access to everything so like if your client is like hey hey I actually want private Equity or Bitcoin um you kind of have to get it for them they're going to leave so I think their their move to become a bigger adviso

r is going to push them into offering Bitcoin at least if not they're probably not going to have a fund maybe um times change but for now I get why they did it if my metaphor for this somebody said oh this is their Bud Light Moment Like This is going to ruin them and I'm like no because budlight really crapped on their own bases views Vanguard did not crap on their bases views this is more like Walmart not letting uh the gangster rap albums in the late 80s uh on the Shelf you know like two Live

Crew and NWA these were my favorite albums as a kid because they had the parent advisory label on them but Walmart wouldn't carry them and it gave them more Intrigue so I actually think Vanguard saying no um gave the story another news cycle it created conflict uh and attention and Intrigue so I think if anything Bitcoin ETFs benefited from that but Vanguard certainly wasn't hurt in my opinion some of these bitcoiners are like boycott vangard one of them's like and I could tell he's a do eth guy

and he's like I just called up Vanguard and moved all my money I'm like there's zero% chance that actually happened but but Eric you know to your point at some point you know as this asset class continues to grow it's going to have to make numbers and sense for them where their CFO or their board is going to say hey hey we're we're missing out here uh when he go back goes back to them you know the business uh and the economics of running that business so do you think it's a year or two years ou

t that they make that switch yeah I would say two or three years um now I'm just saying they let them trade on the platform I'm not saying they offer one but Vanguard sometimes if they can't find a good product uh for like as an adviser they may start do one themselves because they can do it cheaper they may go well we can do this cheaper we can use our mutual ownership structure to keep bringing they may just do it themselves but I would say that let's go in stages first step is just letting it

on the platform and I do think they'll do that eventually um two years I I don't know we'll see at the rate Bitcoin ETFs are going it seems to me that there there is going to be some fomo and more and more if you have their main competitor Black Rock getting a hit product here and they're seeing that this is like used as a a legit portfolio allocation in the black rocks and the fidelities of the world and it's uh how it's going to reduce sharp ratio and there's some more adultlike you know rati

onale as opposed to just when moon or whatever if there's more of that they may go all right well all right it's fine you know we'll we'll allow it but I think they at this time the reputation of Bitcoin is degenerates uh s bank bur fr um all kinds of uh as Gary G put it fraud and husters um and it's a commodity on top of that we don't need it so I just think Black Rock and Fidelity are their two biggest competitors so if they're in it and they start to like I don't know it might irk Vanguard al

so that hey it's not just Vanek or Valkyrie having success like they could care less about those companies but uh Black Rock and Fidelity are their two main competitors and they do care about what they do absolutely now Eric you have a plethora of experience around ETFs and you've seen other asset classes um have ETFs launch give us some perspective here how does the Bitcoin ETF launch compare is is it an outlier does it stand out significantly as it is it is it something You' never seen before

in the ETF world yeah no I look there um there's been big launches um and there's been really highly publicized launches when gold launched GLD that was a big deal um and I I'd say that was the only equivalent to this because there like for example remember you know Dave pornoy launched that ETF buzz and he had all the marketing that thing I think it traded 400 million on the first day which is an insane amount for an indie small ETF I he really got to give him credit for getting that many peopl

e excited but like Bitcoin ETFs did billions um they've already surpassed if you if you just look at like the first month or the first six weeks you know we're about week seven I think if you stack them up on any measurement they blow everything away um at this point you could probably find something in there like oh if we look at the first two weeks and we X Out gbtc technically and we infl adjust for inflation technically G GLD actually was tied like there are ways to maybe find a spot in the

seven weeks where it wasn't Earth shattering but if you go one week one day four weeks 6 weeks seven weeks you look at volume assets flows post gbtc X whatever you want to do you're going to find they blow away every other new launch record it's getting to the point now and I just told you that I'm looking at the most ETFs traded right this is out of 3,400 ibit is seventh um this is you know this is right up there with spy QQQ iwm these things have been around for 25 years right this thing's sev

en weeks old I've never seen an ETF go right up to the top 10 like that in in this sort of a time so and I think gbtc is in the top 30 and Fidelity Fidelity is 38 I mean if you added them together they'd probably be like the fourth biggest most traded and if you're the fourth most traded ETF it puts you around number eight in terms of all equities so if you combined all the trading in the Bitcoin ETFs in fact I'll do that right now you're looking at something like uh let's say we'll call it trad

ing about as much as Apple wow that's a lot right so this is volume and I get it uh some coiners are like oh you talk about the volume but it doesn't necessarily mean the flows are the same and I get that only a portion of volume converts into flows but you have to understand that ETFs are trading vehicles and volume is so important long term and it's important for bigger fish if you're an institution say you're a hedge fund or a prop desk a trading outfit or an um pension plan and you want a li

ttle crypto Bitcoin exposure you love the fact that you can put on a $100 million trade or a $50 million trade and no one will notice you that's a big deal if it doesn't trade a lot there I was like I don't want to be I don't want to be half of the assets I don't want to push the market price I don't want a hedge fund to see a big fish coming in and try to gain me the more volume volume there is the more anonymity these big fish can come in without anybody noticing them they love that and so the

y prioritize liquidity over everything else so the volume is really good even though it doesn't it may get people hyped oh it traded a billion they think oh that's going to be a billion assets doesn't quite work out like that some of it will be inflows but the volume is like um if you were fishing for professional institutional Traders and they were actual fish in a lake and you were s tasking me what bait to use I would tell you volume more important than fees even advisors love fees and low fe

es but these are already low so I always tell people if you want full maximum category growth you need two things low fees and high volume and they got both already so they're in great shape that's why we track volume volume also in my opinion portends flows and assets later like for example in 2008 in the awful selloff a lot of Institutions discovered ETFs for the first time because they were liquid when other things weren't so let's say there's some kind of um massive crash in the market and b

itcoin's kind of uh brought into that and there's some illiquidity in the Bitcoin Market I guarantee you ibit and fbtc these will be the most traded things that offer Bitcoin so institutions are going to be like I'd rather use the ETF than actually even interacting the underlying currency so they're that's how bondy ETFs got big and so 2008 Bond ETF saw volume Spike up huge and then the years after their assets went up volume is a lot of times also when someone gets their first taste of an ETF t

hey're like oh that was I had a good experience they come back later it doesn't always translate immediately that night so but volume is again it's like measuring frequency or popularity over time that volume does convert into assets so to me it's the leading indicator of a categories asset growth hi everyone pardon the interruption I'm Tony Edward the founder and host of The Thinking crypto podcast I have a huge favor to ask you if you haven't subscribed as yet on YouTube or the podcast platfor

ms hit that subscribe button hit the Thumbs Up Button hit the notification Bell on the YouTube platform and on Spotify or apple or wherever you get your podcast please leave a festar rating and review it supports the podcast it allows me to bring great quality content to you thank you for your support and I'll let you get back to the content Eric I don't know if you can take us behind the scenes of how um the Bitcoin is actually bought once you know the cash is put into the uh collected by Black

Rock and these other institutions so the the the volume that we're seeing is is in cash and do you think they're buying the Bitcoin OTC or on the market from uh regular exchanges OTC okay so there's going to be some like that that is a great question and I some people on Twitter like OTC is running out I you know I I got to explore that I'm interested in that I don't operate in that corner but if you send an issuer money if you're if you're an AP you can't send them Bitcoin you have to send the

m money because you want new ETF shares they take your money they go buy Bitcoin through like Jane Street or you know who has it OTC that Bitcoin then goes into their custodian coinbase as soon as that's done they wire you the shares of the ETF so you give them money they wire you the shares back in the meantime they're doing they're going to uh Jan Street or somebody like that to get the Bitcoin that's over the counter but yeah will there be a time where they use other areas or do they currentl

y I'm not sure but that's that's the general way they do it but that part of the market is it's it's not like it's take but it's a part of the market that it's sort of like um you know it's it's how the sausage is made and when the sausage looks fine you rarely go back and look in the factory you're like oh I'm more concerned with how it's selling what the marketplace is like so uh but it's an a great question but there's a good uh I would recommend anybody interested in this um Nate jese yeah h

as a podcast called ETF Prime he interviewed Matt Hogan and Matt went right through like how a bill becomes a law how an ETF converts and I just paraphrased what he he said there issuers have a direct view of this I do not I have to get them telling me how it works because again I'm I'm like an analyst looking from the outside in I'm a I'm a pundit a Critic so I have the data but I don't do this behind the office but that's what issuers tell me happens yeah I'm I'm very curious about the inner w

orkings of that and uh you know what do you think about bitwise uh they have released their wallet address where they're showing their Bitcoin Holdings that are uh you know allocated to the ETF do you expect the other issuers to do something along those lines nobody has yet so I don't know I think bitwise is probably one of the most crypto native uh issuers so it it's on brand for them maybe Arc would do it um you know because they're with 21 shares and opilia Snider is very Crypton native and C

athy's a big fan I could see them do it maybe Valkyrie would do it the bigger guys no way uh they just don't you know that's just not them they don't need to they don't care yeah um they don't only way they do it is if the other if a bitwise did it and bitwise started to get more flows than them that would that would turn their head I don't see that happening so I don't see any reason for them to do it yeah that that would definitely make sense like I'm sure Black Rock they they don't care but l

ike you said if there was a uh competitive angle you know uh where they were losing that they would you know capitulate and do the same thing um now I remember you tweeted about this and I saw the report I think about a month ago that major Banks want to custody the Bitcoin ETFs uh and the problem is the blocker is the sec's sab1 to1 rule and they want to participate you know what do you think about that and let's say that gets removed because you see members of Congress are pushing back on that

rule U what would that open up for the big Banks like JP Morgan and what they would you know decide to do with the Bitcoin ETFs well I look all of them could be issuers today so they've all chosen not to you know the guy who runs JP Morgan's ETF business um he said Never Say Never but he also said they're happy to sit this out and just watch all the craziness um so I think what it means though is that if banks are allowed to handle Bitcoin it means they can be part of the ecosystem more and the

reason they were interested to be part of the e EOS system after the launch was they were like wow this was bigger than I thought it was going to be you have to understand many people wrote this off even really smart people there's this one guy used to work at Morning Star who's like one of the smartest ETF analysts that you'll ever meet he works he's into the crypto space now actually and he he his predictions were so low and I was higher but they like were 10 times higher than mine and his wa

s like way down here so a lot of people just thought this isn't this is all about nothing all this approval watching it's going to come out and it's going to be like there'll be like a couple hundred million but who's really the audience most of them I think underrated um the power of the ETF yeah you know somebody the other day said you know if you want to spend less money stop shopping at Amazon and just go and get everything physically because everything else is the just the lack of friction

makes you buy more yeah that's the ETF so the ETF is so good that you could put like dog in it and it would probably sell a little bit of dog right um not I think Bitcoin obviously has a real market and I say that factiously there have been ETFs that flopped no doubt but the demand is probably even somewhat generated by the fact that it's now so convenient easy it's in a trusted rap SEC approved and it's with these big brands that everybody knows and loves that have been around for like dozens o

f years in Fidelity case like I don't know what 100 years so like this is a big deal for professionals conservative people older people like I said I think that the Bitcoin ETFs are not for crypto people they're for their parents but their parents have a a trillion times more money money than them so I was looking I was actually looking at there's $157 trillion dollar in wealth in the in the United States the Boomers and the silver generation have like 102 trillion of the 157 they have the vast

majority of all the money and so even if a tiny tiny sliver of that is like yeah you know I heard my kids talking about it or I don't want to kick myself in 10 years if this thing does go crazy even if I don't understand it that's a logical thought and so I think that's what people underestimated was the buying the Bitcoin ETF as a way to have a little fun on top of your boring 6040 and the potential future fomo cure people know themselves they they even though they love their 6040 in their Vang

uard they also like sometimes see something happen and they're like they don't want to miss out and I think they feel with Bitcoin it I don't understand it or I even think it's a scam but I don't want to be like feeling like an 20 years down the road when it's a million dollars and I could have just put a little in my account so I think like future fomo cure is an underrated thing and the other thing is the idea that there's way less pressure when you're talking about the hot sauce part of your

portfolio for a boomer they're not going all in they they put 1% and like you know okay it Flames out this is not the the money that counts I'm not going to this isn't my beach house this isn't my kids money right this is just a little flyer on something that just in case it goes up you know so it there's just a lot less pressure and if something's volatile and speculative as Bitcoin is the fact that it's only 1% you can stomach that volatility much better than if it were the whole thing and so

I believe that Vanguard in the core has actually done wonders for people's behavior with the crazy stuff look at Ark Ark was used as as a 1% allocation hardly saw any outflows when it went down 80% in the old days they would have in all the people left but because Ark was simply a little hot sauce add-on people were like yeah okay I I I get it you know Cathy stuff is volatile but I still think she has a vision of the future that could come true and plus it's only 1% who cares so people are less

likely to act that's why this um thesis I see on Twitter about this all Traer and weak hands I would think the opposite I think the Bitcoin ETFs are going to be much stronger hands than people think not necessarily because the people are strong it's that Vanguard and the core has made them strong and that's all all that's underappreciated but again as a guy who lived in this book and the other book I feel somewhat uh trained to make this assessment and when I talk to people and actually inter in

teract with them anecdotally that's what I hear and then I look at the flows and in these sell-offs you just don't see money come adding out of thematic ETFs or Arc ETFs so the stuff that's used in the hot sauce bucket doesn't necessarily people don't leave when there's a downturn some will and ibit in particular could be like the GLD where it's traded so much where you do have these institutions who are using it in all kinds of different ways and the flows might be like this but over net time y

ou probably see an increase that's what's happened with GLD with Treasury ETFs um but there will be one that gets I think more sensitive to price but like a Fidelity One or uh some of the other ones that are long-term holders I doubt you'll see people running for the hills in in a selloff a little but it's not like I I just don't that's my take and so the strong hands theory is also part of why people underrated the growth or the asset potential in my opinion but I'll be honest I even underrated

it a little bit Where We Are now I I I thought there'd be 10 to 15 billion in flows after the first year so we're already at six so we're essentially halfway to where my middle point is and it's only been two months um my predicts prediction is probably dead in the water but I'm happy to be low I think um I think I we've been so optimistic on approval we were optimistic on how these would be bigger than people think like we've been largely bullish the whole time that I think we'll get a for bei

ng a little under bullish but we weren't like haters bull uh bearish 10 to 15 billion is a legit category starter uh GLD was probably I think gld's first year was like a billion and a half so you can see why 10 to 15's pretty optimistic but the six billion I think is uh pretty shocking um in the first two months or it's not been too much seven weeks yeah it's wild so Eric do you think part of the like you said said people's gravitational uh you know pull or bitcoin's gravitational pull to bring

in these investors is due to the change in the macro and different Industries like for example Tech is a Big Driver of Investments now because Tech has been booming right whether it's AI or or whatever web technology and whatever may just look at na Nidia right and and things along those lines they people investors almost see Bitcoin as hey let's get as much exposure to Tech as possible because that's been even though it's volatile has been G giving great returns yeah so I think what you're brin

ging up is a really good point which is um someone uh I forget who it was an analyst who does podcasts like two years ago said I just keep it simple I view Bitcoin as a as a high growth Tech stock and I just want to piece of that stock that's a good way to look at it what I what I am not totally sold on on is this idea that it's an alternative like gold because to me it's a little too volatile to be a total alternative I it is a store of value but it's too volatile in my opinion to be called an

alternative and it sometimes moves with the market like if everything went to hell tomorrow like the stock market I gota think bitcoin's probably going to be like along with it I don't see Bitcoin spiking up like if if there's a huge inflation print even though you think okay High inflation should be good for Bitcoin I just think High inflation means fed's going to raise rates means the market tanks and I think Bitcoin goes along with it because to me for most people Bitcoin is a speculative hot

sauce outer layer of their portfolio it isn't something they expect to hedge anything and they shouldn't but it's being sold a little bit by the fund companies as a sort of sharp ratio increaser uh risk reducer I'm not totally sold on that I think over time it could be but if you charted gold and Bitcoin Bitcoin makes gold look like a money market fund I mean it's it's just too volatile right now to so I like you that's a perfect way to look at it if I was telling somebody who's interested I wa

s like um look I mean just look at it as like some like high growth maybe not yet quite profitable tech company like if you believe in it or you just want to not kick yourself later put 1% in it but just look at it like that expect volatility um and I would that's a great way to to think about it personally I I think that's better than thinking of it as some kind of an alternative or a liquid alt as they call them now great point that you brought up that you know there's a high correlation with

the stock market and just look at covid crash right in 2020 Bitcoin went down too with everything else and then bounced up when the stock market bounced as well so it's following the stock market and Global liquidity M2 so uh to your point maybe over time that changes but the facts the data don't don't lie it's moving with uh the stock market um now let's talk about the 8020 investment rule which has changed to 6040 but as this asset class matures and it goes beyond Bitcoin you have altcoin bask

ets and altcoin ETFs we're going to talk about the ethereum ETF and then you have tokenized Securities you know real estate and and stocks and so forth do you see the portfolio split becoming 60 30 10 and 10 being digital assets um 10 like maybe 10 years from now it depends like for a younger Millennial 10 could be right on the money I don't see Boomers doing 10 sure um I'm Gen X and if you're talking about me personally I I wouldn't do 10 um I'm but it depends let's say an ether ETF gets approv

ed I don't know I just think I don't know if any retail is going to go back to the days of like shitcoin coins and like you know in getting excited I just think I think Bitcoin in particular is it you know maybe I'm in the Michael sailor Camp if there is no second best I mean if ether's going to come along I was just talking to a guy today like ether coming after spot Bitcoin is like the opening act trying to follow the headliner it's like reversed sure e should have come first spot Bitcoin is t

he main attraction the headliner I'm much less interested in anything else and I think over time like GLD or gold ETFs have like something like 90% of the physically back commodity assets silver is a tiny slice platium and platinum are even tinier that's probably what you'll see here but because you argue okay maybe I need some three or four coins you're going to see once they have ether come out they're going to have Bitcoin plus ether in proportion to the market cap that could be something you

put in again I still wouldn't do 10 but I would do one but younger people may be more interested in that I mean the bitcoiners it's amazing how little faith they have in 6040 stocks and bonds which I think is a mistake but that's their choice um so clearly there's some correlation to age and um interest in putting more into non 6040 so yeah it could be for a young person who's really into this it could be like instead of 80 101 it could be like 80 10 10 Bitcoin stocks bonds I mean or for again

I've been on several podcasts where there are 100 z z wow I mean they were like I mean are you are you one of those guys are you like 100% oh no so my my wife wouldn't allow me to that's the thing see you're married yeah you have kids yet or no yeah I have a six zero oh yeah so this is the thing you know some of these Deens there's SLE still so a they may not have gone through a true crash B they don't have anyone uh talking sense to them yeah you know or like hey dude we're not putting all this

on your in your dumb coin we have to plan for the kids educ education that kind of real world pressure I think is going to move people more to a 6040 combo the coiners but I did ask some I asked somebody I asked I said on Twitter the day has anybody ever successfully 6040 pill a bitcoiner and they're all like get out of here that can never happen once you go Bitcoin your mind cannot come back and I'm like this is little scary to me and I'm like I feel like everyone who replied is is single I do

n't know maybe I'm stereotyping or at least they don't have kids yet yeah once you get kids especially in a house and a mortgage it's like I don't know you I don't think you put the whole Ranch on this I wouldn't I wouldn't feel feel comfortable sleeping at night on that but um there some some people just when you go that all in I I find that it's almost like they've gone all in on like this destruction of society thing and that's also another so your bull case is something so really dark and wi

ld yeah I again like it reminds me of the 2008 Big Short People yeah they won but like America collapsed and there was this sort of empty feeling at the end of it all and I don't know I wouldn't want it just seems like going all in on that is it's just like it's like a deeper dive down the rabbit hole than I'm capable of um so I think most of the people who buy 10% or 1% they're not going to go that deep they're going to to this is a little like new gold uh shiny object and I'm moving on with my

life no you're Eric you're spot on because um you know for me as someone who's neck deep in crypto and I have a good amount of crypto Holdings right um I have also a financial advisor I have a college fund for my daughter I have uh retirement accounts with well I shouldn't mention the name but anyway it's one of the Wall Street firms people know so um and guess what my wife made sure that we had all that stuff because it was up to me I would be irresponsibly exposed to crypto so that's that's t

hat's interesting to me so you basically look and being honest if you were single yeah you'd be all in I I think so and mind in other words so in other words you you have stocks and bonds and advisor yes but spiritually that doesn't do it for you you you do it more so to just check the box with being an responsible adult and a husband exactly that's interesting and that does validate my theory that part of the 6040 lifestyle is the domesticated lifestyle yeah absolutely and like you said I have

a mortgage I have a daughter so there's all these other facets of my life that have to be focused on and I can't crypto is very volatile still new um so but the good thing is um I think my wife is coming along more to me being a bit more so I if I were to split my Holdings I'm 60% uh crypto and 40% in traditional assets so you're like a 6040 new new school yeah yeah yeah no um it's that makes sense to me um more than 100% um but yeah anyway you just gave me a little more anecdotal data that just

again sort of solidifies my view of uh correlations between being Allin on crypto and your domestic situation yeah it's it's fascinating and then you know you were mentioning about Boomers having the majority to wealth look in another 10 years fortunately those Boomers will pass away and that wealth I think there's been reports about it will trick it down to Millennials and gen Z and where will they put the money right it's interesting demographic shift and and where capital is going to go so u

m now there's talks of an ETF coming out of Hong Kong we saw it I think the first application go in a month ago um us is the largest Capital Market but do you think do you think Hong Kong could put something together here and there's a lot of capital coming in from the Asian markets yeah sure um I think uh that's let me give you data though in the world the US has 25% of all ETFs but we have 7 something per of all the assets and 85% of all the volume so the US just kicks Global butt so yeah I me

an Hong Kong's probably like 111 % so you can get excited but it's a it's a speck of sand it's a drop in the bucket but I think the more people globally that get into this probably the better I think for your cause so it's it's additive but I don't I don't really see it as being um that impactful what's impactful is seeing ibit today trade you know as much as Netflix or whatever that is so much bigger deal so so it's not it's part of the story but it's just it's like a footnote in my opinion Hon

g Kong there's just so little money there's so much money in the US and liquidity and even people like let me I wrote a book called the institutional ETF toolbox a Japan I heard the story a Japan pension so in Japan pension uses ewj which is the iar's Japan ETF trading in the US because it's just more liquid and cheaper so it went halfway across the world to invest in stocks that are right next door wow so um you're going to find the biggest most serious investors are still going to use the US s

pot Bitcoin ETFs but for local retail it's definitely going to help I think um and it will help bring cost down to the crypto exchanges so it's all net positive but tiny sure um now let's talk ethereum spot ETF what are your expectations are you are you expecting an approval this year or possibly 2025 James is really looking into this now we have to have an answer because we're getting asked more I see approval whether it's this the first the final deadline is in May and it's Black Rock black Ro

ck's big and grayscale also has one and they want to convert and we're in this Deja Vu situation like will they sue if they're denied does the SEC know this will they just approve it not to get sued a lot of unknowns but at the end of the day I'm just going to stick to the eye test they allowed they approved Bitcoin Futures and when they wouldn't approve spot they got sued and the court said you have to approve them basically so the approv spot they already approved eth Futures you do the math s

o either they're going to approve them because they don't want to get sued or they're going to get sued and then approve them I don't really see any other scenario playing out and you can't use the Securities argument now because they've already approved e Futures that's out the window so I my guess is they approve them just to get the hell off the plate and and after that there's really nothing down the road because Bitcoin and ether have Futures which are regulated by CFC and that is a importa

nt part of the deja vu once you get to these other coins like there's no real frame of reference for them there's no Futures market so I'm way less optimistic after ether the question is will they approve them by may you know I think James and I are a little over 50% by may but then our odds go up every month after like so as the more you go out their odds just go go up there's an election coming up too yeah uh which could mean a new SEC commissioner which could mean a whole new sort of thing to

think about so um those are all variables but I'm pretty I'm you know fairly optimistic that we'll see ether but again this is like getting excited for uh um ready I don't know how old you are I'm goingon to throw out Gen X references here this is like you know you've got um Sister Hazel opening for Nirvana ah yeah okay Nirvana is literally so it it's flipped you've got Nirvana opening for Sister Sister Hazel with their one hit wonder I don't know how many people are sticking around after Nirva

na I'm sorry so this is like getting excited for Sister Hazel I I abut understand a reference I am a millennial I am a nir Nirvana fan and I know about yeah so that's that's my metaphor between like why you know I can't get too pumped about ether or even too emot Al or mentally committed to it uh it's part of my job I got to have an opinion James is going to be more into it than I am um real quick question here a rookie question so you mentioned that the Securities uh question is out the door be

cause the Futures were approved it so to confirm something has to not be a security before it can be get a Futures approval it ctfc approved ether Futures which I guess is them saying it's a commodity okay I see which is part of what's been used against gender's comments the whole time I I believe James would be able to really fine-tune this but that's why the approval of e Futures not just e Futures but the eth Futures ETFs if so facto is like him saying it's a commodity or it's him saying it d

oesn't matter that it's not a commodity either way the gen's out of the bottle right yeah yeah that makes sense and I think to your point it's just genser has been the one uh keeping some sort of anonymity here with uh you know not answering questions you know Patrick M Ken was like sir is he doing and he refuses to answer it but you know under Jake Clayton and and Bill himman these guys they had clearly stated etherum is not a security so he's added some confusion um and and uh you know it is w

hat it is I think I said anonymity I meant ambiguity um but yeah it's it's interesting and I I hope he approves it and we don't have to go through this court battle again but maybe to your point it's an election year uh he is Biden appointed Biden Administration appointed maybe they don't want to look too bad uh as we get closer to the election so maybe things will go smoothly we'll see yeah we're we're going to work our back channels what I need is some good tip I need a back alley tip from one

of the lawyers or something um right now we don't really we're not running on anything we haven't heard the reaching out to any we've seen Arc in a I think it was just Arc m update their perspectiv to include the comments from the Bitcoin uh cycle so like arcs you know ready to go I mean they've already updated their comments with like their prospectus incorporating the comments that happened during the bit Bitcoin ETF cycle so um that doesn't mean anything though I mean it it means Arc is arc'

s always been like a little bit of like Head of the Class and all this stuff like every time there was a comments they'd be first out with the comment updates yeah and so I don't know I I like patterns and just so just to see them out in front I feel like some level of comfort but I have not heard of the commission reaching out to anybody and that's what I would really need to see to get excited absolutely Eric I know we're running up on time so I got some wrapup questions here for you if you co

uld create your own metaverse uh what would the theme be Eric go um oh man that's a good question question you know what probably like one of my favorite places to go is like the Southwest like Arizona you know like Road Runner and Wy coyote oh yeah I would I would want to chill there I'd want to go to like like little like what like I just want to be around like reptiles and tumble weed and like those Mountain things and um because it's so different than where I live in Philly I live in Philly

and like I'm close to the beach I go I you know go there enough um we got trees here one thing we don't have and what looks like another planet to a Philly person is like Arizona sure and so I'd make it Arizona theme something like that nice and Rapid Fire questions favorite food crab legs just crabs just crabs yeah because I like blue claw claw too anything crabs to me is the is the top um if I'm on if I have one meal left I'm going on you know three or four pounds of uh king crab legs oh that'

s delicious uh favorite musician or band um I would say radio head and all of Tom York's little side projects even though radio head probably pound-for-pound better but I grew up with them they're my favorite nice favorite movie oh that's tough I mean Jesus there's so many good ones I you know it changes too I would say that I'm going to be lame and and uh probably go Godfather Godfather I even though it's so cliched whenever it's on I get sucked in totally me too same with two yeah such beautif

ul film making like the characters the family story everything is just so money it's like the Mona Lisa of movie movies um and so it's my favorite and um by the way if you are a Godfather fan go watch the the offer the offer is a series that paramont made with Miles um who's the guy who was in um Miles Turner no miles who's the the young actor with the first name miles who was in um a whiplash oh uh and he was in Tom Cruz Top Gun 2 yes yes I know who you're talking about I forgot his name whatev

er miles whatever that dude plays the producer who put together Godfather and the whole thing about trying to put together this movie over like a couple years the mafia doesn't want it made Frank Sinatra is like s there's you know they don't want alpacino playing the part it goes through the whole like on the edge of the edge of getting this movie made was it was ridiculous it's a fascinating like seven part series uh about the making of The Godfather highly recommend I'm going to watch that bec

ause I'm a fan I even read the books you'll it you you're gonna be so into this I promise you oh I'm gonna check that the offer right the offer perfect um favorite book oh man um you know I'm going to go with a book I've read twice in the past like 10 years which is Chronicles by Bob Dyan so this guy wrote one book you know Bob Dyan influenced the Beatles like the Beatles would be singing yeah yeah yeah if it wasn't for Bob Bob Dylan completely changed the whole course of popular music and he an

d he wrote one book and in this book Chronicles it's not like General biography it's all about him um it's not even written in like a normal fashion but what you realize is it starts with him about 12 years old and it ends with him right when blowing in the wind blows up right so it's like seven years and he's sleeping on couches in New York he's going to these different Art Gallery openings he's reading books that are next to and what you realize is that what he's doing is he's explaining to yo

u what went into his brain to allow him to write all that stuff it is the best book on the creative process by one of the most creative people you'll ever and then the second half of the book starts when he's down and out in 19 like 85 remember the you ever see the P picture of from from We are the world where he looks like fat and lost you know when they're singing We Are the World anyway he Bob Dylan looked bad in like 80s the 80s Bob Dylan was like you know Madonna was popular Michael Bob Dyl

an was lost so the book then picks up again in the 80s when he felt he was like in the gutter he was like I had no life no Spirit nothing and he was touring with Tom Petty and was like this guy is so like on top of his game and then it goes into how he found a second creative birth and then it ends when he wins the gr you know the Grammy for so none of it's about the successes or who he dated or anything it's just about how he find his creative footing before he made something that had an explos

ive popularity and I just I read it again it's just there's so much in there from in my opinion one of the best if we're talking like Tennessee Williams or like you know Premier uh poet artists of this generation I'd put him right at the top you know top three and so this book get you get into his brain and creative process and he but he doesn't lay it out the way he writes he's just you just figure out while you're reading it oh I see what he's doing here anyway it's fascinating book there's ma

ny books I love but I I thought that was just a good one for for people who were like watching podcasts are probably like creative type so I'd recommend that I will check that out and finally when you're not working at Bloomberg what are you doing for fun as a hobby um I like to play tennis coach my kids basketball team um and I'll I'll leave it at those two those are my two hobbies for now I do a little painting a little acrylic painting um and when I get into it I love it but sometimes I just

forget to do it and I get busy with like parenting and all this stuff and then I end up just watching TV but um I really really really I'd say tennis is probably my main hobby right now nice Eric absolute pleasure chatting with you as always I I listen I follow you on Twitter you always provide great content and great updates so thank you for joining me yeah great to be here nice chatting with [Music] you oh