Rob Wolff - How To Navigate The Crypto Bear Market And Profit During The Hard Times

Full transcript: Rob Wolff on London Real

2:48 Brian Rose: This is London Real. I am Brian Rose. My guest today is Rob Wolff, the entrepreneur, investor and broadcaster. You are the founder and host of the digital asset news channel, where you post daily updates addressing all the latest movements in the world of crypto with the goal of helping the average person better understand the markets and its cycles. Your early years were spent as a combat medic in the military before beginning their career in health management.

3:10 Since then, you become a prolific investor in both real estate and cryptocurrency. Today your channel has amassed a huge following and is considered one of the most reliable and practical resources for both new and experienced investors alike. As an entrepreneur, you believe that cryptocurrency and Bitcoin will completely change the world as we know it, and that those with the right investment strategy can take advantage of the current bear market. Rob, welcome to London Real.

3:36 Rob Wolff: Brian, a pleasure. Thanks for having me on. I appreciate it.

3:39 Brian Rose: Great having you here. Been loving a lot of the content you’re producing in real time to talk about.

3:44 You know, let’s be honest, the madness of the past three months. We’ve seen a lot happen in this space. Obviously markets have come off, but it’s also, you know, been centered on a few protocols kind of coming into crisis, failure, and I don’t know. I thought maybe we could start there, because you’ve kind of gone deep on the Terra Luna phenomenon, the Celsius phenomena, we both had Mashinsky on the show in the past, and the Three Arrows phenomenon. And just wondering, maybe we start there, or maybe zoom out a little bit on the perspective of this year.

4:15 I mean, would you, would you definitely bring those protocols up when you wanted to tell the story of 2022, or is it more complex than that?

4:23 Rob Wolff: I will say this. I don’t know if I want to start there with somebody who’s new to cryptocurrency to talk about hey, you know, what’s a really good play is all these different protocols and projects that really almost collapse the whole market. I think I would start with a little bit as far as, like, history, start with Bitcoin, start with decentralization, start with the foundations of money, and then kind of work our way up from that.

4:46 I think that there’s a lot of good things in the space, but unfortunately, just like with growing pains, just like we saw with the advent of the internet, there was a lot of bad players in the beginning, and we had to shuffle those people out to grow, and I think these projects, I mean, the Terra Luna, the Three Arrows Capital, unfortunately, with Three Arrows Capital, with that contagion going around. It’s like a tentacle getting into all these different projects, kind of collapsing or really pulling back a lot of things. So right now, if I, as I take a look at this, at this whole industry and I see what’s going on, if it was me, this is the time I’d want to actually be investing, which would be the exact opposite.

5:31 A lot of people do. They look at things and go, well, here’s an example, 2017. Numbers go up, everything’s great, I’m gonna get on top of that train, and that, and we both know this, this is how people operate. They go, it’s going up, I’m gonna ride this train all the way to the top, and then I’m gonna follow it all the way down, because I don’t understand some basic principles. So right now, as everything is going down and let me be clear.

5:53 100 clear. I know people would like me to say that this is going to just be a V-shape recovery, and it’s going to be awesome. I don’t believe that. I think there’s a lot of problems with Three Arrows Capital and the tentacles that they had, and the billions of dollars that they, that they pulled in, and they can’t pay all these loans back. It’s going to start to collapse even more projects, and then the problem with when projects collapse, the valuations go down, and the VCs, they got that invested into these protocols, and that this could be top 20, top 50 as these things called unlock periods, and then as those, as those start to unlock, then there’s only one place that’s truly liquid, open 24 7 365, and that’s not 4x, and also crypto.

6:36 So I think there’s a little bit more downside pain but if you understand that these are just normal cycles, this is the time that you want to say, okay, maybe this is a good position for me to start, to start dollar cost averaging and get into this game, because I have a three-year, five-year, 10-year outlook. I don’t want to just look at, like, six months to get rich, because guess what, everybody thinks like that, they’re already wrecked. And how many people out there are willing to buy the lows?

7:05 You know, these are the people that would have, you know, I mean, because there’s not many people that don’t get excited by that FOMO, and they probably have heard of crypto before, which means they probably would have got in into that. Very few people are just hearing about it now. So do you ever meet that disciplined investor that says, okay, I am going to start dollar cost averaging at the lows? No, you don’t, because that’s how, that’s how everybody gets into it.

7:33 Unfortunately, this is Bitcoin encrypt you, and crypto is a cruel mistress. What’ll do, or do, is it will lure you in with these, with these promises of massive returns and asymmetrical returns and investing, and you get into it at pretty much the wrong time, because that is when it’s the most sexy, when things are going up again, and people get into it, and I did the same thing. The same thing happened to me in 2017, and that’s one of the reasons why I started this channel, because in 2017 when I got in, I had heard that Bitcoin was going to a million dollars, and it was going to just keep rocketing up, and I heard this from a lot of people.

8:08 Now even people like John McAfee. He wouldn’t lie to me, but, here we are. And then, just, it goes up, then it goes down, and then before you know it, you got people saying, don’t worry, it’ll just rebound. It never rebounds, because of this thing called crypto winter. So for me, what I did when I started to invest, because mostly before, again, it was real estate investment and I thought, well, I’m just going to apply the same principles over there.

8:33 Over time, and if I can just write it out, I think things will be okay. So I told my wife, I said, look, that money that we put into crypto in 2017, now that it’s February 2018, we’re down about 80. So here’s our options. I can sell everything right now, and I can take a huge loss, and I can get out of here with my tail between my legs. But I’m not in the business of losing money.

8:54 Here’s what I’m going to do. I’m going to start to dollar cost average, just like we do with different investment properties. We’re going to slowly build into it, and then over time we’re going to reap the rewards. I don’t know if it’s going to come back, because in 2017 we didn’t have the President of the United States talking about crypto. We didn’t have the SEC really clamping down.

9:12 Our Congress, having hearings and things really moving. We didn’t have Paul Tudor Jones, the big investments, the Brian Rose is coming in talking about crypto, and those types of things. We didn’t have that. We just had a belief that maybe this would be a new type of monetary system. Now, fast forward to today, I mean, things are completely changed.

9:30 If it was me, and I see that these pro, where they are, this is the opportunity, I think, for people to get in, and I’m not saying to you know, sell your house and go all in. I’m just saying that this is probably one of those times that I would look very heavily into crypto and start to invest in those things, and only invest what you can afford to lose, of course. So what I see is people are not going to get in. People like me and you and people watching your show, they’re going to understand these processes and say, you know what, this is the time when everybody gets rich, and the bear market.

10:04 Nobody gets rich in the bull market. It’s when they just start to accumulate, at this time, and that’s where all the money’s made. And then what’ll happen is, it’s very boring, people will get into it, another bull run will come. I believe in the four-year cycles, so once that happens, people start to sell off. They’ll unlock, or they’ll start to sell as things go up, and as things go down, then all the people that come in in 2024 and 25, they’re gonna be the people like me in 2017.

10:29 Brian Rose: Right, so you’ve been through this cycle, so you can speak with knowledge and experience and tell people that this is the time to build.

10:38 Rob Wolff: Yeah, I mean, I think if you, here’s a, here’s the thing, you know, that people who watch our show, it’s not just, it’s not just the heavy investors. It’s not the people who are extravagantly rich. I’ve got people who watch my show who are doctors and lawyers and people are doing pretty well off, and I’ve also got a lot of people on my show who are young kids 18, 19, 20, are just getting into the game.

11:04 There is really no way to become financially independent through a job, job and I call a job just over broke. That’s really what it stands for, because to really get into that is a very difficult situation. So I think you have to do some investing, whether that be equities, securities, whether that be with crypto, whether it be with real estate, REITs. It’s just, it’s, it’s all into the person who, what they see themselves investing into and what they feel a connection to, where they can actually put their passion into, but in all honesty, for people to not invest, I think, is a mistake on a lot of different levels.

11:41 Brian Rose: Yeah, Robert Kiyosaki was in the studio, author of Rich Dad Poor Dad, and he said, Brian, poor people work for money and rich people make money work for them, and you know, you’re, you know, that from the real estate game and the crypto game, and it’s well said. You’re right. If you just have a job, it’s probably not the way you’re going to become wealthy. It’s going to be done on the back of probably investment in assets, right?

12:04 Rob Wolff: Yeah, like, I get I get emails all the time.

12:06 Like, I had a guy a couple weeks ago, he said, hey, I am a plastic facial surgeon, and I’m doing, I’m just getting into crypto and digital assets. I like your channel, and I just want to see if you have any advice for me. First of all, I can’t give anybody advice. I’m not a financial advisor. However, I tell the same thing that I tell you.

12:22 I think this is, this is one of those good times to start to dollar cost average and get into it, learn about it. And this is why you have your DeFi Academy. This is why I have my free 100 free website. Dan teaches crypto.com, just to come in there and learn about the different crypto, the projects, how to do your own research, so you don’t have to rely on people like me. You can go out there and go, okay, this is what I’m looking for.

12:46 I’m looking forward to see how big is the community, what is the utility, what does that actually do? Take a look at the tokenomics. Am I going to get dumped on, and how much is the actual circulating supply, and also take a look at the team, what have they done before, to potentially what they could do in the future. And these are just some of the basic things to look at, because it’s a new industry. It’s not like evaluating stocks and saying, well, let’s just take a look at the P.E. ratio, let’s take a look at 12 months back, or what the earnings report says.

13:11 It’s not as simple, simplified as that. There’s a lot of nuances to this, and there’s a lot of education needs to be done,

13:19 Brian Rose: and that’s your CUTT system, community, utility, technology, tokenomics.

13:23 Rob Wolff: Your C.U.T.T. Okay, right? And see, so when I first got in, I just thought, well, whatever I hear about on YouTube and Twitter and the Twitterverse, maybe that’ll be a good project.

13:35 I didn’t do it too much education, and I can tell you right now, there’s a lot of people out there that are in the same boat right now today, because, unfortunately, this is gonna be unpopular. There’s a lot of people out there that are just pumping and dumping stuff, and they’re just worthless. There’s worthless cryptos, I’ll be honest with you. There’s like 19,000 crypto digital assets, and they’re all going to be, I mean, the majority are going to go away, because they don’t really have any utility.

14:00 So what I took a look at is, as these new projects come into formation, there’s a system that I took a look at and said, well, how can I evaluate this, because I can’t do, again, like the P.E. ratio? I can’t take a look at the spreadsheets. I can’t take a look at the SEC filings, because there are no filings. There are nothing like that. But what I can take a look at is, as these projects come into the crypto verse, let’s take a look at the community.

14:26 How big is it? And in the old days, in the boom of 2017, ICOs, when that was just the biggest pump and dump of all time. There was no community. All they would do was reach out to people to shill all the different projects, and then people like me would watch those videos and go, oh, that looks pretty good, and then we would get dumped on, and that was one of the reasons why I started the channel, because that just cannot go on. That’s a recipe for disaster.

14:51 So what I take a look at is the community now, and, like, one of the projects we took a look at, and I haven’t done this many. We’ve only done four on our channel, on the, on our second channel. One of those was Ginsokishi, and that was a project that had already been a free-to-play game. It was called Elemental Knights, and I already had millions of players. This is in mostly Asian countries.

15:17 It was on PlayStation. It was on Nintendo Switch, iOS and Android, so I already had millions of community members who were going, wow, this is pretty fun to play for free. Now you’re going to go for play to earn, and I’ll just switch over that, because I like making money. I like this game So then we took a look at the utility. What does this token do?

15:33 Well, in this metaverse and this game, would actually drive the whole ecosystem. Then we took a look at the team, that, well, they had already been building on all these different platforms, so it was like a no-brainer. And the tokenomics, we took a look at what was the cliff, uh, when did the unlocked schedules, and what was the max supply? So am I gonna get dumped on? And that was like that was in December, and it started out at like a penny, and I went up to a dollar 45.

15:56 Now, because this bear market, we’re down to right around 40 cents, but it is still one of my best performing players on my portfolio. And then we just moved down the line, and now we’re on our fourth one, where we’re talking about Sweatcoin, which we did a deep dive on. That won’t be out until the weekend. Until the weekend. Nice.

16:15 Brian Rose: All right. So the CUTT system seems to do you pretty well for kind of giving a deep dive, but not too deep to evaluating different protocols and coins and giving you a kind of a good initial reaction, right?

16:26 Rob Wolff: But I gotta, I have to make a distinction, and that is that, that is just for products that are really coming out and are new. So let’s, let’s fast forward. Let’s take a look at a project like Celsius.

16:36 With Celsius, which just pretty much collapsed, they are they had stopped all the withdrawals, and you had over eight or ten billion dollars in assets under management in that platform It was a lending platform, and if you took a look at the CUTT, you’d say, well, how does that, how does that compare? The thing is, with the CUTT system, that’s only for the introduction of these new projects. Existing projects, it’s pretty much out the window. You have to be on top, just like, well, you know, Brian, just like you have to be on top of all of your investments at all times.

17:07 You have to get all the news, all the information that you want to do, because if you leave it up to happenstance and just say, well, I think it’s going to do well and I’ll just kind of forget it, you know, set it and forget it, like the food dehydrator. You’re going to be in a world of hurt, and that’s exactly what happened with Celsius. As time went on, you could see that there was some issues there, there was some liquidity, illiquidity, insolvency, and of course they also had issues with Three Arrows Capital on the lending platform.

17:34 And then even going down to Luna and UST, there’s a lot of different theories about it, and from what I can understand is that they didn’t invest per se into the Terra ecosystem the Luna coin or into UST, but there was, again, this is all hearsay, there was a lot of different organizations, institutions who wanted to do, like, a bailout, and they asked Celsius, is one of them, and they said no, we’re not going to do that, because it’s, it’s more important for our community to be taken care of first, and that was a chain reaction, which I don’t want to get into, because I don’t want to get sued, so we’ll just go down that way. But if you, if you take a look at the CUTT system for them, their community is huge. They have, you know, over a million different people.

18:25 The utility for the token itself, when you actually invest into it and put on the platform, the higher the amount of Celsius you had, the more the rewards that you would give back for the different cryptos that you would actually put on there, which they, of course, re-hypothecated, and unfortunately I think there was some issues with some fractional lending, which I think is one of the issues But the utility was there. The team was stellar. Yet Alex Mashinsky, he was, not solely but at least partially responsible for Voice over Internet Protocol.

18:53 He had three companies with billion-dollar exits, and then the tokenomics were pretty good. However, that’s just for the beginning. Moving forward, to take a look at it, what was going on behind the scenes, and these are the things that you really can only get just by the news that comes out, and you can take a look at an on-chain analysis to see just exactly where these wallets are and what’s actually happening, as far as who is selling, and that’s a whole different other video.

19:17 Brian Rose: Yeah, it’s a pretty good analysis of what I believe happened or heard that happened. I mean, again, we talked about the beginning of the show, and maybe we should talk about it now. We had obviously Terra Luna, which maybe we’ll talk a little bit about. That, you know, really collapsed. It was the algorithmic stable coin of choice, and a lot of money in it, and then it came off pretty quick, which then caused more selling into the market of all their reserves.

19:41 Then obviously, later Celsius got under pressure, and maybe there was positions in there, maybe some fractional lending, maybe some staked versus ETH positions, and maybe some also not malicious actors, but people doing some dumping on there, they had to suspend everything, and then, obviously, later we saw Three Arrows go down, which reminds me more of like Long-Term Capital Management, which I saw go under in 1998, which was again some of the smartest guys in the world, Nobel Prize winners, former Wall Street heavyweights, out in Connecticut with a hedge fund with massive amounts of leverage. We thought they couldn’t do anything wrong, and then all of a sudden they were over-leveraged, and they pulled markets down, and you know, I think it was the Russian crisis that kind of forced their positions, and then it just all fell apart, and they were supposed to be the smartest guys in the world, and they took up the market down with them, and I don’t know if you compare that to Three Arrows, but 300 sounds like it was highly over-leveraged, not very well regulated, and it seems like it pulled a few things down, and maybe might more in the future.

20:44 Brian Rose: How’s my assessment of those three events, pretty good?

20:47 Rob Wolff: And I’m not going to talk to any, any particularities, because there’s a lot of different theories that are, are thrown out there, but I will say this, that one part you talked about as far as leverage, that is a, that is a big thing. Uh, and I think there is, there’s three paths to ruination. This is what Charlie Munger talks about. There’s ladies, liquor, and leverage, and if you can remember that, I think that will cause you a little bit of pause when you go, maybe I should go with 25x, 50x, or 100x in this position because I’m going to make a ton of money.

21:15 I don’t think that is, that is the play. So for me, like, on my channel, I just have certain rules. One of those is take profits. Have everyone broke, taking profits. No leverage.

21:25 Can get away with it. Don’t keep anything on exchanges right now, especially, they don’t know what’s going to happen with the 3AC contagion. Also, don’t invest more than you can afford to lose, and the last one is everything’s a scam, meaning treat everything like a scam until you do your own research and prove it otherwise. If you can follow those five rules, things tend to work themselves out. I know it’s very boring, and it’s not very exciting, but it’s done pretty well for me so far.

21:52 And I will say, like, even with Celsius, on, I went to Consensus at Austin, and I met a lot of great people there. A lot of people in a lot of the upper projects, and there was a lot of buzz. That’s when I talked to them about Celsius when we were there, and that was on June 9th and 10th and 11th. I drove back home, because it was in Austin went to Texas. Did a video on Celsius, said there’s something up at Celsius, and we have, I think you should take your crypto off.

22:21 That was at 11 a.m. at 9.00 p.m., roughly. They stopped all withdrawals. So these are the things, like, even though you think, like, the team is great, like the one, the example you gave, the smartest people in the room. You have to be on top of things, because this is the people watching this video, this is your money, and if you don’t watch it, who’s going to?

22:39 Brian Rose: Yeah, well said.

22:40 Brian Rose: Those are great rules, very, very great rules, and obviously now they’ve been proven pretty correct, as well as these markets came off. Rob, you’ve said before that we need a crypto recession. I’ve never really heard anyone say that. What do you mean by that?

22:55 Rob Wolff: Well, this is great, because this, again, not very popular, but it has to happen, because the products that are out there, if you really take a real look at them, like, what do they do, and how stable are they, and really, are they just here for a cash grab?

23:10 I can tell you, if you really dive deep into a lot of them, you’ll see that that is exactly what it is. So now we have, first of all, we were at 3.2 trillion dollars market cap. That was one of the higher points, and that was in May 2021. Now we are below a trillion dollar market cap, and a lot of these, these smaller cap type of projects, they are just kind of sitting there with, with liquidity, they’re not really doing anything, they’re pulling people in, and I don’t think they’re actually here to actually build and get the rails going, to actually give us to that next level.

23:41 So when I say there needs to be a recession, I think these projects that are just there, I think a lot of them need to go away, and if they don’t go away, I think what will really help is regulation, and again, we know that regulation’s coming, whether we like it or not, so we have to accept it. Give me the rules of what I need to do so I can bend the rules, and then just go from there. So if I have all these different, if I have the SEC coming in and they say, look, these are securities, you need to register with the SEC.

24:10 You need to fill all this paperwork. You got to get our lawyers involved, you’re going to have to actually pay up a bunch of money to actually get this whole project going. A lot of those projects, they’re not going to make it. So what they’re going to do is they’re going to fall away, or what I think is most likely to happen is what happened with Amazon in the early 2000s. They’re going to say, look, we got a lot of capital here.

24:29 We want to buy up these warehouses, we want to buy up Zappos, we want to buy up these companies and just absorb these other entities to become even bigger. I think that’s what’s going to happen with some of these top 10, top 20 cryptos. They’re going to say, look, we need developers, we need brain power, we need the things that you guys are doing maybe not too well, and we want to absorb you into our ecosystem, and I think that is why we need a recession, so we can just solidify, and we can come back stronger, and that’s where I think all the growth really does come from.

25:03 Brian Rose: If you’re talking those top 10 or 15, then you’re pretty much talking about these layer 1 protocols. Perhaps, perhaps, maybe we can talk about them. I was fortunate enough to have a bunch of the layer one CEOs on the show. I had Emin Gün Sirer of Avax, and John Woo was co-founder, and we had, um, the Hedera Hashgraph on. I had Justin Sun and a couple others, and, you know, they all had a consensus algo that they thought was the best, and they all were building something that we all needed, right?

25:32 We needed something that was faster and cheaper, and, yeah, I was always impressed by the brain power. But I also asked him, like, how many are we gonna need? And probably they said, probably a handful, you know, or keep them on one hand. Do you think that some of those will survive, consolidate, others, and be kind of the blockchains of the future? And again, Cardano and Doge could be in there as well.

25:55 Is that what you’re kind of saying, or were you also talking about, like, maybe a sandbox that does the same thing?

26:01 Rob Wolff: I think if you take a look at, well, yeah, I mean, if we break it all down to the different categories, because not all cryptocurrencies and digital asset projects are created equal. So you have these, these layer one protocols, which everything builds upon. So it’s like, and one of the things for, for people watching the video right now, is that who got rich in the California gold rush?

26:21 Was it the prospectors that came out there, or was it the people that actually sold them the picks and shovels? Obviously picks and shovels. So if you want to take a look at layer ones that things are being built on, that’s why Ethereum does so well, because everything built was built on Ethereum, and it’s still being built in Ethereum. Unfortunately, I don’t know if that merge is actually going to happen sometime this millennia, but, uh, hopefully that we go.

26:40 So yeah, I think a lot of these, some of these layer ones, it’ll be somebody taking the lion’s share, and then there’ll be people or projects underneath, and I think Ethereum will do quite well. And again, if you take a look at, like, the team, the people behind it, like Dr. Gavin Wood for Polkadot. He was a part of Ethereum. He’s already built or been a part of that ecosystem, so he knows what to do and how to actually make it go. So that’s what I like, Polkadot.

27:05 Cardano, people don’t like, some people love Cardano or they hate Cardano, but Charles Hoskinson, again, was part of the Ethereum mafia, as I call them, so that could do pretty well, and then of course Avalanche. They got a really good system, and it seems like it could do quite well. Again, who knows? And then of course we got Solana, one of the, the new kids on the block, that does pretty well. It does concern me that they’ve had a couple of stoppages, but maybe they can finish, fix that, because they’re in beta.

27:30 So for all these things that are going on, this is why you have to diversify, right? I don’t think that I would, I mean, I could tell you, I won’t. I won’t put all my eggs in one basket and go, this is the winner, because I have no idea. Anybody out there on YouTube or Twitter or any kind of guru that says this is going to be V1 is full of it. They have no idea what they’re talking about.

27:51 This is just, uh, they’re just speculation, and we go from there. So that’s just the layer ones, but if we take a look back to, you know, going below the top 20. What about metaverse plays? What about the Sandbox? What about engine?

28:05 What about all the other cryptos that could potentially power these metaverse plays? This is even riskier, because, do you know any metaverse that is really doing great, well, and just taking off. I don’t know any of them yet, and I think that’s going to be a maybe a three year, five-year play before we figure out which one could actually be it. So this is, and maybe the next one isn’t being built. So all these projects that you have, just again, if you’re taking a look at it, take a look at the CUTT.

28:34 How big is the community that kind of drives things? Utility, team, and tokenomics. Just go from there. So if I had to invest, Bitcoin, Ethereum, Polkadot, Cardano, Avalanche, a little Solana and some other stuff. That’s all I’ll say, and no metaverse play.

28:51 No Sandbox. I had Sandbox. I’ve seen Sandbox, and it looks, and I, it could, because it has a lot of people behind it, but I hold very, very little. I, I sold a chunk of it, because I just, when I look at these things in 2017, you could see that the things that people were talking about, it was just hopes and dreams and white papers, and I kind of saw that in 2021, where I think I thought to myself, does this stuff really do anything yet? Did we really, are we really capturing a huge amount of the market share for what this is supposed to do?

29:27 I didn’t see it yet. Maybe in the next one. So Sandbox, I’ve sold a little bit off, but it could be the could be the next great one. Don’t know.

29:34 Brian Rose: Yeah, a bunch of my students are in the Sandbox.

29:36 They’re buying big plots of land together and develop in mansions, and I’ve been in on the alpha runs, and I’m seeing what they’re doing, and you know, it’s still early days, but I got a little love for the Sandbox, because, you know, it seems to bring a lot of people in and brings people building projects, and I can see where it needs to go. It’s not really there yet, but I can see where it’s kind of going.

29:57 Rob Wolff: So I know what you mean by that, and that’s I’m sorry, Brian, that’s smart, because like the land development, we like real estate, real estate works out pretty well.

30:06 And that’s in the physical real estate realm, but in Sandbox, I’ve got a couple plots right now that I probably won’t sell for quite some time, because I don’t know what’s going to happen with that. Maybe advertisements, maybe we set up some kind of, like you said, mansions or business type of thing, where people go in there and do virtual meetings. I don’t know. So I’ll just stick on with that and just pretty much forget about it, and then just go from there.

30:28 I will keep following up with the Sandbox, just to make sure they don’t collapse or something, but I think owning some virtual land, I think, is a pretty good play for the long term. So short-term, medium-term, long-term plays.

30:38 Brian Rose: Yeah, I think you’re right. I think some land would be, will be good. It’s come off quite a bit, and yeah, I know what you mean with metaverse.

30:45 I mean, five, ten years from now, I think we all believe there will be real viable metaverses that we spend a lot of time in. So, to Zuckerberg, but right now they’re not there per se but have you, have you used those, those goggles? The virtual reality goggles?

31:01 Rob Wolff: I have tried to. How, what do you think?

31:03 Brian Rose: You know what, I actually started playing the Oculus game a couple years ago, when a bunch of people here at the, at the, the team had them, and I tell you, Rob, the thing I loved the most was just hanging out in the house in the very beginning, like not even going across the Niagara Falls and all this crazy stuff, but just sitting in this, like, kind of very calm house that was like overlooking some valley in the sunset, and stuff, and I found it quite, you know, meditative, if that’s a word, and otherwise I found it interesting. The thing I noticed, Rob, is that after a week when I came home I chose not to put it on, and I chose to watch something on, like, YouTube or something, and I noticed, wow, I guess I don’t like it that much, because I don’t feel like sticking it on my head every night.

31:48 So that was interesting.

31:49 Rob Wolff: Yeah, it’s just like, it’s just like the internet. If you have, when you try to use a browser back in the early days of the internet, it was an awful experience. Everything was like pixelated, and it was very condensed, not to what we see today. So like those Oculus headsets and the things that are coming out, that has to change radically.

32:05 Maybe augmented reality is the next big thing. Maybe just some overlays, but not the goggles to actually push it to the forefront.

32:11 Brian Rose: Yeah, that’s probably true. I mean, I had to be kind of hardcore, and they’re a novel, but like I said I don’t think it’s something people stick on every night when you get home, so it is a novelty. AR, yeah, you definitely think that’s happening, and it, rumors are that it will, and when Apple gets involved, it will happen.

32:27 I think they’ll probably bring a decent product to market. We’ll see. I had, in the early days, one of the guys from Google on the show, and he brought one of those Google glasses, and I said to him you know what you call people that use those? He said, what’s that? You call him a glasshole, and he said, yeah, I’ve heard that.

32:45 So it was fun to play with, but it never made it to production. So we’ll see what happens. It’s going to be, it’s going to be kind of interesting for sure, but we’re keeping an eye on the space. I’ve had some good people on the show talking about metaverses, like the Illuvium guys and some of the other people as well. So it’s, it’s impressive what they’re building.

33:02 It’s gonna be slower now, obviously, but kind of, we’ll see. Rob, Bitcoin you haven’t told me much about how you feel about Bitcoin. How do you feel about, you know, the, the OG, digital gold, digital asset play, you know, in reference to all the other coins you just mentioned?

33:21 Rob Wolff: The Bitcoin maxies are gonna love this statement. As I get into crypto and digital assets, and the more time I spend here, the more I become, more of a Bitcoin maximalist, because when you take a look at what has longevity and what has been around and stood the test of time.

33:39 These are the risk, these are the risk on and risk off assets, and Bitcoin is the least risky asset in the riskiest market. So when I take a look at Bitcoin, it’s, it’s a funny thing, because we always, when I first got in, we heard that it was a cryptocurrency, and you could shoot it around the world, and you could pay for all these things, even if you wanted a cup of coffee. Well, we found out very quickly that as the market cap grew and people started to open up more wallets, and they started to actually use it, it wasn’t a great payment system.

34:15 It was expensive and it was super slow. Then, of course, SegWit came around, and then all of a sudden the Lightning Network came up and then we found out that, yeah, I guess it really can be used for currency. We’re seeing it in El Salvador. We’re seeing in a lot of different countries being used. I think it’s a, it’s a lot better thing than remittance payments, where you have to spend for Western Union to send back money back to your original country.

34:39 So when I take a look at this, I just think it’s technology that we that will probably do well in the future. We just don’t know exactly what to do with it. Mark Moss had a great quote. He said, he talked about steel in the early days of man, when we discovered steel, he said, well, you know, we made swords and arrow tips, and that was nice, that helped us out with wars and conquering different lands. Then we started to, you know, build buildings, then we thought, well, maybe we can make it bigger, and we made skyscrapers, and then we thought, maybe we go to the moon, and we made space shuttles out of steel.

35:14 So the same thing with Bitcoin and decentralization, and maybe just using Bitcoin as a protocol to build everything on top of it, because it’s the most secure network on the planet. Again, I don’t know where it’s going to lead to, but I can tell you, as time moves on, my portfolio right now is seven seventy five eighty percent Bitcoin, Ethereum, because it’s the safest play in the most volatile market.

35:38 Brian Rose: Very interesting. I’ve had quite a bunch of maxis on my show, including, including that including goddamn Kaiser back in 13 when he came on my show screaming about Bitcoin, and I bought some Bitcoin back then and he refused to come on my show the last year because I talk about anything but Bitcoin.

35:55 But I’ve had a lot of maxis on here, including Michael Saylor, who actually interestingly enough, I wouldn’t call him a maxi, because at the end of the show he said there is a place for a digital currency. He said Bitcoin is digital property, but like you said, people don’t want to use it as a currency because they don’t want to sell it, and he said there is a place for digital currency, and I was like, well, that has to be kind of a programmable contract, and he’s like, oh yeah, it probably does, so I understand why he doesn’t own it, because he likes to have something that probably goes under the regulator’s eyes, and we can talk about our buddy Gary shortly. But yeah, I had quite a few.

36:31 Rob Wolff: Oh, Gary does.

36:32 Brian Rose: Yeah, I know, I’m sure he watches this show as well. And, uh, go, we’ll talk about regulation and Gary in the SEC, but, uh, yeah I mean, it’s great to talk to Bitcoin maxis. Sometimes it’s frustrating when they give no time to anything but Bitcoin, and it can be a bit frustrating when they don’t acknowledge there’s something there with Ethereum, or maybe with metaverse, or maybe an NFT might be some use in the future, even if it represents a property or my identity or my medical history.

36:58 So sometimes it’s hard. They end up just talking about fiat currencies and freedom, which I like, freedom too, but you know, it’s interesting having those conversations. You mentioned Ethereum as one of your also basics that you have. Mike Novogratz was at Token 2049 conference here in London, and he said, look, Bitcoin’s digital gold, Ethereum’s digital tech. He’s like, if you want a digital technology play with the leverage of that play, then you want to be in the Ethereum.

37:24 How do you look at it with your portfolio, because I thought you were just going to say 80 of my portfolio’s Bitcoin only?

37:32 Rob Wolff: No, because again, like, if you, if you take a look at, I think Bitcoin has its place. Again, we don’t know exactly how great this technology will be, but if we just take a look at what, just take a look, if you go to CoinGecko, and you click on ERC20 tokens, it’s like the entire crypto economy. I mean, everything is built on Ethereum right now.

37:53 Brian Rose: So I know people will say, and even I have been critical about this, about moving from proof of work from Ethereum to proof of stake, and actually, I, we were talking to Simon Dixon yesterday, and his Celsius recovery plan, and he was an early investor in the ICO days of Ethereum, and he said, you know, in the white paper that they gave us, they said within the next year they were going to work, move from E to E 2.0, and that was, you know, years and years ago, so that, I’m not too confident that’s gonna actually happen, and then another thing is, that people have to understand is that, that’s just, there’s three parts to it, and the second part hasn’t even come up. The merge is supposed to happen in August, and that won’t reduce the fees, that won’t reduce a lot of, the, some of the problems that are going on, but it will hopefully get them off from proof of work to proof of stake.

38:44 Rob Wolff: But when I take a look at what’s being built on it, it’s all these different projects, and at some point they may move on to, like, a Cosmos, or to, like, an Avalanche, or a Solana, or something like that. But right now, in the short-term play, I think they’re just there, and they’re using ERC20 tokens and the Ethereum platform to grow. I don’t know what’s gonna happen in the future, but right now this is where we’re at. So I’ll stick with where we’re at for right now.

39:12 Now things will change. It’s not about flip-flopping. It’s about keeping on those investments, making sure you know exactly what’s going on, and if some great project comes out where people can just switch over, then off I go from Ethereum.

39:25 Brian Rose: Yeah, I’ve called Ethereum the Microsoft Office of the smart contract spaces, and it might not be the best tech, but it’s what everyone’s using, so guess what, it’s got the market share, and you’re gonna use it too. The big, the biggest complaint I get in my crypto DeFi Academy is the gas fees, because we use Ethereum for getting everybody up the curve on yield, swapping, liquidity pools, and all things DeFi, and they constantly complain, because we, you know, we start very small and get people to just understand the protocols, and sometimes the gas is more, more expensive than the actual trade notional, and I just say, look, it’s not gas, it’s tuition.

40:01 So just, it’s a learning experience. Just pay it. And in the future, we will hopefully have either proof of stake or things like Avax, where you can plug in and do it quicker, but in the meantime, I’d rather you just get to know it and pay the gas.

40:15 Rob Wolff: But yeah, yeah, it’s something that people are concerned about. And again, I’m, I’m not going to hold my breath for the 2.0 merge.

40:22 Brian Rose: I mean, I had Stani Kulechov of Aave in this studio last year and they don’t even think they had integrated Avax in the Aave yet, and I said, Wednesday 2.0 coming, and he said sometime this decade, and he laughed, and again, he, he was highly, highly invested in that protocol. So yeah, I think you’re right. It’s definitely one of the blue chips for now, or the least volatile of volatile cryptos, and like you said, probably what people are going to develop on for the next year, right?

40:51 Rob Wolff: Right, I don’t think, I mean, right now you’ve got a lot of layer ones, and they’re doing pretty well, but let me just take a look at the different issues. And we talked about Solana, and of course, if you’re really big into decentralization, they have an issue where sometimes they go down, whether that be just DDoS attacks or other issues that go on behind the scenes. They have had a point where they’ve had to suspend the network, and what do they do?

41:20 They contact the validators and say, we need to restart. That doesn’t sound very decentralized to me. However, does that mean that that’s what it’s going to be like for the entire time that Solana is around this earth? Probably not. So as time goes on, they’ll probably do pretty well, and then for these other protocols, they’re just kind of finding their legs, and they’re, and of course they want people to build on their platform so they can grow their ecosystem.

41:43 Unfortunately, they are behind the ball right now, because they’re just trying to get these new projects in, and that, I think, if you really want to take a look at the next big project, just take a look at the ecosystem and what is being built on it, and the best place to find that information, just go to Twitter and follow Avalanche, follow Solana, follow Polkadot, and you’ll see that they always put out their updates for the ecosystems. Right? A nice graph, very easy to take a look at, and go, oh, they’ve grown from, you know, a thousand to two thousand different protocols.

42:12 So that’s just something I would take a look at.

42:15 Brian Rose: Yeah, well said. I’ve got some pretty high-level people in my, in my Kings of DeFi group inside my academy, and they said that stable coin regulations happening before year end in the states and I’m wondering if you think that’s true, and can you comment on that? Is that been accelerated by Terra Luna and what’s the status of that? And then we’ll get it to Gensler after that.

42:41 Rob Wolff: Yeah, so, I mean, take a look at all the things that people will consider bad: bear market bad, these stable coin issues, this is bad, projects, and it’s going to recession bad. You can take a look at it both ways. For me, when I take a look at the market going down, I’m like, this is good, this is good, because now I want to pay so much for these cryptos. I can get a nice, you know, deal as they move forward, and then for a recession, well, if you play your cards right and you’re sitting on cash, is kind of king, and you’re waiting for some crashes.

43:15 This is, and Robert Kiyosaki will talk about all the time, this is where kings are made in these, in these recessions and these bear markets. So for the collapse of Luna, that people say, well, that’s bad, that’s bad for a lot of people, because they lost, because they went against the rule, which is they invested more than they can afford to lose, and they put a lot, too much in, and unfortunately a lot of people lost a lot of money. That’s bad, but what’s good is that this regulation finally not, finally, I would say Congress and the American government takes steps up and says, hold on, wait a second, these are stable coins.

43:54 They’re supposed to be backed by something, not algorithmically, but can you show us what it’s actually being backed up by. That’s why I like USDC. Allaire, the CEO, went before Congress and said, look, here’s all the paperwork that we have. You can verify that we have everything backed up by USDC, either by whatever asset that you want to say, or on cash. So I like that part.

44:19 Tether who knows, you know, we can, we can see that goes, but what’s great about this is that the people that lost their money, I know it’s bad, but this is going to lead to some regulation for stable coins, and now we can get a little bit more, not so much, choppiness in this area. I know people don’t like regulation, but it’s kind of funny. It’s kind of funny that when people get rug pulled and lose all their money, now all of a sudden they want regulation.

44:45 So unfortunately, I’m just gonna tell you it’s coming anyhow. So give me the rules so I know how to bend the rules, and then we go from there, not break them, just bend them to what I want to see.

44:56 Brian Rose: Now does that regulation mean you’re all going to be using my CBDC going forward? Is that what that means?

45:02 Rob Wolff: So if you look at a, so there’s a difference, like stable coin, stable coin, private companies, central bank digital currencies, right?

45:09 Brian Rose: So if we had, and Giancarlo, I think they call him Crypto Dad, yeah, he was here, he was here a few months ago, yeah. So he, his idea was this: if we’re going to create a CBDC in America, there’s two options. We have, we can do a digital yuan, where we pretty much spy on everybody, and we could do that, and then it’ll probably go through, because unfortunately people aren’t really educated as far as finances and really what this all means, or we could make this a little bit more of a private transaction, just like how cash is now.

45:40 Rob Wolff: I hate to tell you like, cash is the greatest thing. If I wanna, not that I do this, Brian, I’m just saying, if I had cash and I want to, you know, pay something out of the table. It’s a lot easier to do it that way than with credit and debit cards and things that people can see.

45:54 Brian Rose: So he said, what if we made this a more of a private transaction, like a Zcash, like a Monero, something like that. Two different ways.

46:00 Rob Wolff: Will government do that? I can tell you right now, people are screaming at the screen right now saying that is ridiculous, that’ll never happen, but this is one of the project prospects that have been put out there. CBDCs, the government, the central banks, versus stable coin, stable coin, private industry, just like a Tether, just like a CB, just like USDC. And I will say that, you know, the Bitcoin maxis, who, that’s it, just Bitcoin, and that’s it. There’s a gentleman, Peter McCormack, from What Bitcoin Did, and he had on Lyn Alden, and they were talking about stable coins, and he said, you know, I’ve been a Bitcoin maxi for a long time, and I love it, and Bitcoin’s the greatest.

46:38 He goes, but if you’re in a third-world country and you have your fiat is collapsing, and you put into Bitcoin, and then within a month Bitcoin drops by 30 percent, and you make 300, 400. That’s not sustainable. However, with a stable coin, if I put that into a stable coin, which is backed by dollars and not by petro dollars or something in Venezuela, because I can see the appeal of why people want to use a stable coin. That was the first time I’d heard, like, a Bitcoin maxi actually talk about something else besides Bitcoin.

47:09 So I said, makes sense, yeah, totally makes sense.

47:12 Brian Rose: I’m a big fan of Lyn Alden as well. She’s great, and it’s nice to see them kind of open their eyes to a stable coin be interesting to see how it gets regulated, and yeah, we had a lair on the show, and it was great to see what they do, which is kind of the top of the food chain of those. Do you think Tether is going to be deep pegged? I know there’s some rumors out there, and maybe some some of my old buddies in New York City trying to push that down.

47:36 Do you think that will happen?

47:38 Rob Wolff: Well, just like the Bitcoin spot ETF, everybody’s been predicting the demise of Tether for quite some years now. They’ve also been predicting this spot ETF that’s going to come magically from the SEC. Hint, it’s not going to happen. So I will just say that Tether, they did have an audit.

47:57 I believe it was in the Caribbean, the Virgin Islands. It did pass and I can tell you that even when UST, or the Tether stable coin, or algorithmic stable coin, was lambasted and lost its peg, and everything was going to hell in a handbasket, Tether still retained. So would I use Tether? I’m not saying to use it. I don’t, but I’m just saying for right now, I think it’s going to survive for quite some time.

48:22 But you talked about this in your video about options. Why deal with the risk? If you, if you feel like there’s, there’s more of a risk than you want to take on, then why even use Tether? I know, in some exchanges you have to use it, but why do it if you don’t feel like it’s right for you? Then just get out of it and go to something more stable.

48:40 Brian Rose: Yeah, no, well said. With that, and I always tell my students early on in the course, I said, look, you know, it says, it says a stable coin, it says USD something, but let’s just be clear. It’s not like a dollar bill in your hand. It’s not like a dollar in a bank account in America that’s guaranteed by the FDIC. It’s not backed by the full faith and credit of the United States.

48:58 It’s ultimately still on a blockchain. Yeah, it might be collateralized with the lair, you know, with one U.S. Treasury, but that doesn’t mean it’s going to be there when you need it. So again, that’s probably why you’re getting a higher yield for it as well. So just be aware, you know, as they say on Wall Street, there’s no free lunch.

49:17 You know, if you’re getting a return, you’re going to probably be paying for it, and some type of risk. Again, UST, you’re getting 19 returns on that. In retrospect, you know, maybe there was a little more risk there. So yeah, you’re right. If you don’t need to take the risk, don’t take the risk.

49:33 Rob Wolff: It’s probably good, a good thought there. Yeah, exactly, and then just a little segue. Yeah, I was perusing the YouTube channels, and I saw your great video yesterday about options. You were at MIT. We talked about this off camera, and and that, so I had heard that she had a DeFi Academy, and I was like, okay, well, I don’t know what that all’s about.

49:53 And then we were talking about another YouTuber who was lambasting you about, uh, why would you even listen to Brian Rose or Wolf of Wall Street? Because I was like, yeah, why would we listen to Brian Rose? And then, so I was listening to this video. I had no idea that you were for Wall Street for 15 years in derivatives, making all those huge trades, and doing a lot of risky type of plays, but also protecting assets. So like when I take a look at these videos, I think it’s the same thing as, like, is, like, research on crypto.

50:24 Like, you have to find the nuances, right? Yes, you go to Brian, and Brian will probably tell you, you know, buy Bitcoin, Ethereum, but since he has that experience with trading all these derivatives and the different risky aspects, these are the things I don’t talk about, because that’s not my lane, but I think there’s people out there that probably want to learn about that, and those, the nuances that I think that people don’t understand, especially about risk assessment and using options and calls. I mean, some do, but some get just horrible advice.

50:52 So why don’t we get some good advice from somebody who’s already been there? He knows all the tricks of Wall Street, which would be Brian Rose.

51:00 Brian Rose: Yeah, I appreciate you saying that. You know, last year we went heavy into crypto and DeFi and all these things, and I started using and reusing 15 years of my life that I had kind of locked away for a while, and I actually had some amazing experiences. You know, I was 21 years old, 1993.

51:15 I sat on a desk at a company called Bankers Trust, and it actually, uh, strangely enough, Dan Tapiero from 10T Holdings was there, and Dan Moorhead from Patera Capital was right in the same room, and I didn’t know them then, but they were right there, and I was trading a massive derivatives book for, you know, a big, big bank, and I got to understand what risk was. I got to see traders and how they executed stop losses. Our P.L. was every day, bounced around the world, globally, so there was a lot of transparency.

51:44 I got to learn about how to get out of positions, how to play derivatives positions. I traded a lot of U.S. government bonds, like a lot, bond futures, mercantile futures, and then went into credit derivatives as well. So yeah, I had quite a lot of experience there, and it always bothered me that derivatives got a bad name. You know, derivatives is not what caused the housing crisis. Bad risk management is what causes all the crises.

52:08 And the derivatives, you know, I’ve had a lot of people on my show talk about a lot of things. One of them they talk about is, is drugs aren’t bad, the misuse of drugs are bad. Drugs are just chemicals, and the same with derivatives. They are just instruments, for transferring risk and for getting different risk appetites. As humans, we’ve been using derivatives since the beginning of time, and so what I try to do with my students in my courses is just say, look, this is a call option, one of the most basic forms of derivatives.

52:36 This is how it works. It gives you leverage, and you sacrifice a premium, and you sacrifice an amount of time you have to exercise something. But we try, we buy and sell options between each other as humans all the time. Hey, you want to come to my party on Friday night? You can come if you want.

52:52 That’s a call option to go to their party. You can also not show up. So we have them all the time. You know, my kids have a put option to probably move back home one day if they ever screw up in their life, so that’s a put option that I’m short on my kids. So we’re actually constantly trading those options.

53:07 We just don’t always value them and price them in the right way, so I just get my students to go through one transaction, and so that was that video. I was at MIT a couple months ago, and I was at one of the whiteboards, and I just drew it out. So yeah, I just try to bring some of my experience to this table, but as I tell my students, look, options, I just want you to understand it. You can get in plenty of trouble with the volatility just in crypto, so it’s not something you want to use, but I think it’s one of the building blocks of finance.

53:36 So yeah, that’s, that’s kind of why we jump into it.

53:39 Rob Wolff: Yeah, and to me, it made a lot of sense, because people, when you get into investing, you don’t really, sometimes you don’t think about the risk, and this is one of those problems that, you know, I get DMs and emails all day long about, hey, I have all my money in Celsius, or hey, I have, I had all my money in Terra Luna, and I can’t retire now. Now I have to get work another 10 years, and I’m like, what?

54:00 Which part of that would you, is, is the smarter option? Did you in the beginning, should you have done that? No, you should have done that. Did you understand that the risk that was involved? Well, not really.

54:09 And I think with these types of things, like academies and stuff that are out there, that if people don’t realize this now, they’re going to learn the hard way. So you can learn from mistakes. They just don’t have to be your mistakes. And just go from there.

54:24 Brian Rose: Yeah, let’s talk about Gary Gensler of the SEC, who recently came out and said only Bitcoin, I think, is not a security, and we can talk about that.

54:32 You know, SEC is an interesting entity. I think it was born out of the stock market crash at 29, when I went to Wall Street. I had to get my Series 63 and my Series 7 exams. I had to get fingerprinted. I had to take them, and that, that way I could be a licensed broker dealer.

54:48 I started watching Gary’s course at MIT Sloan School Management. I watched 24 hours of him teaching blockchain back in 2018, when I think he was CFTC chairman. I’m not quite sure what he was then, but I, I started really liking Gary, because Gary’s really smart, and he understands all these blockchain protocols really well, and it made me sad to see that a guy like that would say stable coins or the wild are the poker chips of the Wild West. What do you make of Gary, the SEC, crypto, the future, some?

55:20 Rob Wolff: So some people hate Gary, because he’s not very positive for their coins. Ripple would be the prime example, and of course those investors got railroaded, because as we were going into a bull market, that’s when the lawsuit came about from SEC versus Ripple, and pretty much tanked that whole project instead of going up. So I can understand why people are really ticked off. They’re saying, hey, you’re here to protect the consumer, I’m the consumer. I just lost a lot of money.

55:49 What are you doing? So I can see there, on that side. I also watched Gary speak at MIT. There’s YouTube videos you can check out. I even did a video on it.

55:57 I thought it was fantastic that somebody who really understood crypto could come in and be a part of the SEC, and also previously of the CFTC, and then maybe have some influence. The problem was is that he took, he took a hard-line stance, and he said, no, we’re going to really sharply regulate, and when I talk about regulation, it’s a little goes a long way. Unfortunately, with Gary, that’s everything is a security besides Bitcoin, and this was just this week, I think, that he was on, I think it was MSNBC.

56:31 He said, I will say that Bitcoin is a commodity. That’s the only one I will call a commodity. Everything else we are just assume that is it is a security. So, and then I have to ask you, Brian, when he talked about stable coins being the poker chips of the Wild West, how far off was he? What I’m just asking you, because, well, but is USD, but I mean UST wasn’t really around then, but is USDC a poker chip of the Wild West?

56:57 I don’t think that’s correct. Is it?

56:59 Brian Rose: No, they’re not all poker chips, but I mean, like, even your Justin Sun, who was on here.

57:03 Rob Wolff: Yeah, I mean, they have their own stable coin.

57:05 Brian Rose: They do, and it looks like it’s, it’s retained the peg.

57:07 There’s some on-chain data analysis that might take a look at who has minted all those coins, and which wallets they’re actually in, but that’s not for me to really go into this video.

57:18 Rob Wolff: So for when I take a look at what Gary’s trying to do, sometimes I don’t think we’re all evil. I think at some point he really is trying to say we really should protect these investors, because a lot of people lost their money, and they’re going to use this prime example of what happened with Luna to really railroad and really push in their agenda, and can you blame them?

57:41 Because even people in crypto who were anti-regulation, now all of a sudden, like we need a little bit of regulation. And again, I think it’s coming anyhow, and I think their, your question beforehand was, will stable coin regulation come in by the end of the year? I don’t know if Congress can pass anything that passed that fast. It seems like they can talk about and have committees, but to actually get a law passed is like an act of God these days, and especially with midterms coming up, I don’t really see that really getting pushed through.

58:11 I could be wrong, but I hope I am, but we’ll see, but I think that regulation will come pretty fast and furious, especially to get us the next level. Is this bad? No, I think this is where we have to be. And then here’s another, another question. If everything, if Gary says Bitcoin is a commodity, fine, and then he calls everything else is security, now everything has to has to come in.

58:34 Does that affect the, the people who are buying the securities? We do this all the time. We buy securities. It’s on Robinhood. We get equities.

58:41 We buy stocks. The big problem it’ll be for is those exchanges where they have to actually put everything in, all the paperwork, and say, now we’re gonna register for securities, and that’s why I talked about, we need to have a recession, because a lot of these, a lot of these projects will just go away or get absorbed. So I think it all kind of comes together. I think we actually need that.

59:01 Brian Rose: Yeah, I understand Gary has a difficult job.

59:03 He’s also very underfunded in what he does, and they can only bring a few cases when they bring them. He is basically a politician as well. And so he kind of has to use a blunt instrument to try to affect the most people in a positive way. So you know, Gary could make sure my mom doesn’t buy the wrong stable coin by rattling his saber and saying, don’t do this. So I get it.

59:24 I just also don’t know if it’s the best thing for innovation in the, in the crypto experience.

59:29 Rob Wolff: So yeah, you’re right, for innovation you’re 100 right, it’s going to stifle innovation. It’s going to be a problem, and just like the different projects that were started in the US of A, they’re going to go to other countries that are more, a little more reliable as far as what they can do, and unfortunately America will be left in the dust for innovation and crypto and digital assets for some time.

59:52 And so that’s the prediction. It will be left in the dust. Not totally, less than dust. At some point, we’re going to have to. They’ll get regulation, we’ll know where they’re at.

1:00:03 It’s just like, it’s just like tax laws, right? If you knew exactly what was taxed, then you’d know exactly what not to do and what to do. So it’s the same thing I think with these projects, once they, once they figure out what’s a currency, well, that’s from the OCC. What’s a commodity? Well, that’s, that’s under the CFTC jurisdiction.

1:00:18 What’s the security? That’s the SEC. Now we know exactly what it is. We know what the criteria for a stablecoin is. We know what these products have.

1:00:24 Let’s just do it this way, and then we can innovate. The problem is that’s not going to happen anytime soon. So, like, products just go out, and there’s different products I’d like to be a part of. I think you’re, a lot of people that are watching the show like to be part of, but if you’re in the United States, you can’t.

1:00:39 Brian Rose: Yeah, yeah, that’s very much true, because they won’t allow, there’s so much regulation.

1:00:43 Yeah, my students in the States, they struggle, because it’s very hard, and depending on what state you’re in, it’s even more difficult. You mentioned Giancarlo, who was actually here in the studio, Crypto Dad. I was, I was actually quite impressed with Chris, and I like the way he was looking at CBDCs, and he said, look, I know politicians, and what they’ll do is they’ll wake up one day and say, oh yeah, we need to do this. And he said, unless somebody’s been working on a, a really a good version of a CBDC, one that embodies, in, in Chris’s opinion, freedom in all of its aspects, you know, the American version of freedom, and unless someone’s been really working on that for years, they’re gonna grab whatever’s around.

1:01:21 So he said, I want to work on that as the absolute contrast to the digital yuan, which, even by the horror stories, even if you discount those, is pretty intrusive. And so it was interesting for him to say that, and for the first time ever, I thought, yeah, maybe we should be proactive about a CBDC that embodies freedom and gives people privacy. What, what are your thoughts on that, and how soon do you think we are to getting one of those in the States?

1:01:45 Rob Wolff: So yeah, I mean, it’s, it’s the smartest thing we can possibly be a part of. Do you not want to be a part of the conversation and just let government just railroad us and go, we’re just going to do it this way, because this is what we think, because we’ve done these studies, and we have these experts. First of all, experts, experts can, can only tell you what was. They can’t tell you what will be. So when we talk about these people and these politicians, if we’re on a part of that conversation, that’s why we have the Blockchain Alliance, and they go to Congress and they meet with these congressmen and women.

1:02:12 They say, this is what we’d like to see, and if it wasn’t for that, these bills that would come out would totally erratic, not eradicate, but it would totally stifle again massive innovation for the crypto space. So again, if we’re not a part of it, we have to be proactive, and I know, people, again, people will, they’ll hide in their shell. They go, well, they can’t touch us, they can’t touch us, because because we’re crypto, but you understand, I mean, just take a look at the different laws that were being trying to be passed by the EU, they wanted to have all of these wallets, like your MetaMask wallet, registered.

1:02:47 Tell us, do all the KYC, do all the AML, or you won’t be able to transact. People say, well, that’ll never happen. It does happen, so how you can do that without an exchange, or if you’re in China and you don’t have a VPN. You want to do things. Look, you’ve got two options.

1:03:03 You can send the sidelines, do nothing, or you can be part of the battle, and get out there and talk to your politicians. Say, this is what I want to see. This is where we have to go.

1:03:12 Brian Rose: Yeah, really well said. Yeah, it’s been very cool to talk to a lot of these people about these issues and come up to speed with that.

1:03:19 Rob, you know, a couple of things from your final things as well. You know, you talk about navigating this crypto jungle, and again, you talked about some really good rules before, but for people that are new, or people that are even experienced but new to this type of a fall off, what’s the best way to treat these next 18 months? And again, you’ve even said this could be 36 months as well, so maybe also, I should get in, how bumpy it’s going to be, for how long.

1:03:43 But what are some, some basic strategies, philosophies that people should adhere to?

1:03:48 Rob Wolff: Well, the rules that we just talked about. Treat everything like a scam, as it probably is in crypto. Don’t invest more than you can afford to lose. Don’t use leverage.

1:03:57 Take profits along the way. That’s a big thing. Even I had a problem with that, taking profits along the way. Nobody want broke. Nobody, everyone broke, taking profits, and don’t keep things on exchanges, your crypto.

1:04:07 If I would have left the original 20 to 30 of my portfolio in Celsius, where would I be right now? It’d be locked up, and I couldn’t get access to it, because it’s not FDIC insured. So there’s that aspect of it. Also, you have to understand is that we’re probably in a recession right now. Let’s be honest.

1:04:25 GDP growth was stunted, Q1, I think, when Q2 numbers come out, July, July 1st. Right now we’re going to see, your recession, I think people will, they’ll flip out. They’ll start to sell things, because all we’re in a session, we’ve been in a recession for a while. So just know that this is a natural cycle of the bull and bear market, and if you, if you understand that these things will come back, and you realize that, okay, it’s not going to be like this forever, and you can go take a look at, the Fed, the St. Louis Fed.

1:04:57 They, they take a look at the, there’s a diagram from 1958 to present. They took a look at all the different recessions, and you can see that recession’s usually about a year and a half to two years, so if that’s the case, and you’re in a recession, this probably, these markets will probably be a little bit flat, boring, or they’ll even drop even farther. If that is the case, this is what I did in 2018. I just dollar cost average. Kept buying along this container, whenever it was boring, and everybody took off.

1:05:25 I was buying Bitcoin at five thousand, six thousand. I was buying Ethereum around 200, 250, 350. I was buying Cardano around seven, eight cents. Imagine doing that for two years or three years when nobody wants to be a part of this because it’s boring, and the numbers aren’t going up. When everything turns around, natural cycles, then you’re going to look like a genius.

1:05:47 Everybody’s considered crazy until you’re right, and then you’re a genius. And that’s the big thing that I can say to people: just believe in yourself and you can do these investments. Everybody’s got the brain power. It just depends on if you have the stomach for it,

1:06:00 Brian Rose: and Rob, what keeps you doing this every day? Like, what, what’s your main goal?

1:06:04 What keeps you excited about this? Is it being, like, of service to the community? Is it feeding your own interests? And like, what do you do, what are you doing five years from now?

1:06:14 Rob Wolff: So I hope I’m here doing these videos.

1:06:16 I, I think we’re in the same boat, Brian. We’ve, we’ve done pretty well for ourselves, and you know, money can only get you so far, but then what really drives you, is it just to make more money? Is it for me to buy another pool house? Is it for me to buy, you know, 20 yachts, or is it a purpose? So like for me, when I get in, when I got in on crypto, I was, I was led down a path that wasn’t optimal, so I always said if I did a YouTube channel, what I try to do is just guide people in some basic principles so they don’t get screwed over like I got screwed over, and I said, I’ll try to make it as, you know, interesting as I possibly can, and then make it accessible.

1:07:00 That’s why at Dan teaches crypto, the website, it’s all the basics that I’ve known, the safety issues how to do your own research, and I made it free, because I don’t know where people are accessing this. If this is first world or third world countries, I have no idea, so I just made it free, because not everybody can afford 20 bucks a month, 30 bucks a month, and off I went, because it’s just the basics. Now to go to the next level, that’s why you have Brian Rose’s DeFi Academy.

1:07:23 That’s next level stuff. So for me, I think in five years you know, hopefully I’ll be here, if, you know, who knows, my heart will last, I don’t know, and then and what drives me is just for people to say, hey, I’ve been listening to your show, and I’m able to quit my job, I’m able to retire early, I’m able to spend more time with my family, do the things I want to do. That’s the bigger process. So I just try to get as right as I possibly can,

1:07:51 Brian Rose: and when do we get mass adoption, and what does that look like?

1:07:55 How does that change the fabric of the human experience?

1:07:58 Rob Wolff: We get mass adoption. We don’t have to pay these crazy gas fees. First of all, we get mass adoption when your mom can actually pick up and transact in crypto and make it super simple. We got mass adoption with the internet.

1:08:11 We didn’t have to really monkey around with browsers and really do the connection. It was just, it happened. You don’t see what’s going on behind, and you’re behind the curtain, and then you can just actually use it, and it actually has real-world use function. So like, the big thing that even Mark Cuban put this out yesterday, and he said the way for crypto to really explode is to have some big super app that does something that we all really need, and everybody starts to use it, and I was thinking to myself, like, that makes a lot of sense, because, like, for the internet days, I mean, really, when we had, when we actually did all these searches and that, it was inaccurate, really wasn’t used and it was junky.

1:08:48 Then along that was, like, Ask Jeeves and stuff like that. Then we got Google and actually worked out, then Google Maps and all the different things that came along with it, and no one really knew what was happening behind the scenes, because it was so simple to use, and it was super cheap, because in the early days, remember those AOL CDs, 40, 50 bucks a month, something crazy like that. Now it’s not that much at all, so that’s when we get mass adoption.

1:09:09 And of course, the bigger issue is education. When people understand that, hey, this money printing actually does equate to a bunch of inflation and all these different taxes that we have. Where’s this coming from? And then of course, the basic principles. I think that’s when everything blows up.

1:09:26 Brian Rose: And do you think that will ever happen, where people actually understand monetary policy?

1:09:31 Rob Wolff: Everybody, Brian, that’s the secret. Not everybody will understand, but what they, but I can’t get, I can lead a horse to water, but I can’t make it drink. I’m just looking for the people that I can pull on the life rafts and get out of there as fast as possible, and there’s some people that are gonna, they’re going to pick it up, and there’s some people, like, I don’t care I just want to live my life, and that’s fine.

1:09:53 I’m not for those people. You’re not for those people. We’re here for the people who want to learn and grow and actually be, have economic freedom.

1:10:01 Brian Rose: Yeah, that’s really well said. I agree.

1:10:03 When people don’t know it’s a blockchain or a crypto transaction, when they’re probably using it the most effectively. And I remember I was in the dot com boom and bust in New York City, and no 102, and then after O2, nobody wanted to hear the word technology stock, or technology anything, and yet then Google was built, right? And that changed the whole game, and that was built in the technology bear markets when nobody wanted to know, and they created something that was highly functional that everyone started using, and it changed the world, and they built a multi-trillion-dollar company.

1:10:36 So yeah, these are great examples of what will happen in blockchain. Even Giancarlo when he was here, he said this will be 10 times bigger than the internet, and, you know, these are bold statements for someone who used to be the chairman of the CFTC to make. So yeah, it’s good for everybody to keep that North Star. It’s hard to do it in these times. This has been painful for a lot of people, and we just got to learn this is what humans do.

1:11:00 We do crazy things. We create bubbles. We crush our bubbles, and then we always wonder. I remember when I got to Wall Street, Rob, I looked around the desks, and I think at the time emerging market debt was coming back, and yet the Latin American crisis had been like six or eight years earlier, and I was like, wait a second, wasn’t this crisis just not that long ago? And now you’re building a new desk to take advantage of the new high yields, and then I would learn about the Asian crisis, and then this crisis it was so obvious that it was just very cyclical, and it is, and I guess that’s a reflection of who we are as humans.

1:11:35 Rob Wolff: Exactly, it’s all cyclical. The four worst words in finance, this time it’s different. It’s not, it’s just repeating again and again and again.

1:11:43 Brian Rose: Yeah, but when you’re in it, it’s very hard to discern what’s happening.

1:11:47 Rob Wolff: Well, that’s why people are, people like us, we tell them, it’s the same thing.

1:11:52 We just, I just reinforce, reinforce until it becomes a habit. Look, this is gonna suck for a while. I know it’s tough to actually put money in as everything is boring or going down, but after, you know, two, three, five years, I’ll see you on your mansion, whatever you’re doing.

1:12:09 Brian Rose: Yeah, Rob, I always got a couple final questions. I’ll ask here.

1:12:13 Brian Rose: Best advice you’ve ever received. It could have been investing advice, advice about crypto, advice about life, but if you think about that, is there something that comes to you?

1:12:23 Rob Wolff: But you know, since we’re talking about finance and kind of finance geared, but it was Warren Buffett. You can learn from mistakes, they want to be your mistakes. That’s why I’m always trying to find the right information from people who have screwed up in the past and made these mistakes, why not to do the same stuff.

1:12:41 But there’s other, there’s better advice. Well, you know what, one of the Stoics, they said, I know nothing, and when I take a look at all the things that I think I know, and the more things that I learn, I realize just how much I don’t, really don’t know, and I need to learn a lot more in this space. So, like, even as much as far as we get Socrates, I believe we said, even as far as we get, we just realize there’s a lot more to actually get to the next level, and the most dangerous ones are the ones I think they know everything.

1:13:14 So I know that I’m not there yet. I just gotta keep on this path to learn as much as I possibly can.

1:13:20 Brian Rose: And on that same note, advice, final advice to anybody listening now, whether the newbie or old b in this space, but what should they be doing going forward?

1:13:30 Rob Wolff: Just know that you’re gonna, you’re gonna meet a lot of, you’re gonna see a lot of bad advice out there, and that’s just, that’s just the truth, and if you don’t really are dedicated to learning these things, it’s gonna, it’s gonna really pass you by.

1:13:46 It really comes down to the hunger to learn, to really get to understand these principles, and then just doing it. You think it’s easy for me, or was easy, or me just to start putting, just dollar cost averaging and putting money in when Bitcoin was 20k, and then it went down to 3k. It’s not easy, but it just takes practice. It’s just like working out, the more that you do it, the easier it becomes, the more it becomes an actual habit. So just know that nothing’s easy, but you can absolutely do it.

1:14:13 It just takes time.

1:14:14 Brian Rose: What’s the best way for people to follow you? Obviously websites, and either are you on Twitter, is that your place to be? How can people find out more about you?

1:14:24 Rob Wolff: That toxic place, Twitter.

1:14:25 Yes, unfortunately, I’m there, so to Twitter. If you’re not familiar with Twitter, crypto Twitter, think of the grain of salt, but that’s where I do a lot of my, I put my information before I do the show, so we talk about it there before I flesh it out to actually do my live stream, and that’s, you can follow me at News Asset, or just on YouTube, just put in the search engine on YouTube, Digital Asset News. We do a video every single day. It’s a live stream.

1:14:52 I do about 20 25 minutes of news about what’s going on, to keep you up to date. So you have to do all the work, and then after that we do about a 30-minute Q and A, where I answer all your burning questions to the best of my abilities, and those are the two main platforms, and of course Dan teaches crypto.com, 100 free website everything I’ve learned thus far, then I’ll get Brian in there and talk about DeFi Academy, and we’ll go from there.

1:15:12 Brian Rose: Yeah, I’m going to drop a video on there for you as well.

1:15:14 So, no, I, I appreciate that. I appreciate anybody that’s teaching out there, because it’s a, it’s such a, it’s such an important job and something that not everyone does. had Silvio Micali here of Algorand Network, and he’s, you know, from Sicily originally, a fellow MIT grad like me, and he said at the end, he said, Brian, you and I both know that the teacher learns more from the student than the student learns from the teacher, and he’s right. I learned so much from my, from my students.

1:15:42 It’s a real honor to teach. So really appreciate that. You know, Rob, it’s fantastic to have you here. Appreciate all the videos you do. Appreciate all the real-time stuff you do, especially lately about these protocols and what’s happening in real time, and it’s been great to tune in and see the way that you’re detailing, doing the analysis, talking about that in real time in an agnostic way.

1:16:05 That’s what’s really appreciated about you. I never feel like there’s an angle there, and I feel like it’s just you’re trying to get it transparent with what people are doing, so yeah, I really appreciate that. The long-term perspective, and that kind of almost that real estate perspective of crypto, I think that’s really needed out there, and these are the lessons. Right now is the time to build. So any final thoughts from you?

1:16:26 Rob Wolff: And just want to say thanks for, thanks for this. No, I want to say, I’m, I’m love watching the show. I’ve been a fan for quite some time. Someone, of course Alex introduced us, and just to be on here is a real treat. I want to say thanks for having, having me on, and for everybody watching, I just remember the basic stuff.

1:16:44 You want to make it too complex? Just keep it simple, and I think you’ll just be fine in these turbulent markets. Brian, thanks, fantastic.

1:16:51 Brian Rose: Yeah, shout out to Alex from Zelda SwissBorg, who’s the connector to everybody. Rob, really appreciate you.

1:16:57 Everybody, follow this man on Twitter, go to his YouTube channel, and go check out that free teachings. And next time, Rob will do this in person.

1:17:05 Rob Wolff: All right, sounds good. All right, thanks everybody. Take care.

1:17:09 Brian Rose: Thanks everybody. We’ll see you next time on London Real. Take care, bye, you.