00:00 Speaker A
Brady, it’s good to see you. Clearly, it’s been an interesting year for crypto in both positive and negative ways, mostly negative in terms of price. Um, as we move into this year, um, I guess I would first ask about the price as far as anyone can predict the price, but what are the things that you’re going to be watching that could be a potential catalyst to the upside and downside?
00:30 Brady
You know, the guys at Castle Island Ventures, an investment company, said they think there was an exchange that was destroyed by the market disruption in October. If you remember, there were massive losses in October, uh, as a number of futures contracts slipped. And they kind of think that could have brought out someone big and so we’ve had four sellers in the last couple of months. If that turns out to be true, if that’s really what’s holding Bitcoin down, then once this forced seller gets sorted out, uh, you know, things could look really good. Of course, we see Bitcoin rising right now. This is probably because people expect a large amount of oil to hit the market soon.
01:13 Brady
Um, you know, these are two positive forces. I also think that if regulation actually comes to the fore this year, not just like ideas about regulation, which is kind of what 2025 was, we’ll see a lot more enthusiasm in the crypto market.
01:36 Speaker A
Yeah, I mean, we had stable coin regulations, uh, in 2025, right? The big thing that everyone is waiting for now is something called the Clarity Act, right? It’s going to, uh, it’s kind of the market trend if you will, right? Is this the right way to describe it? How do you think this will go?
01:58 Brady
Well, first of all, it is worth noting that the stablecoin law has been passed, but it has not yet come into force. So, I mean, it’s important. Um but on the clarity law. So I don’t think the clarity law will pass. It’s as if the Senate simply hasn’t been able to move this issue forward. and now, Cynthia Lumes, who has been a major supporter of the project, has announced that she is retiring, giving her much less political capital to work with in Washington. I just don’t think they can pull it off, but I don’t really think it’s going to matter because I think Paul Atkins and the SEC and the CFTC, which is now run by one of Paul Atkinson’s deputies, are going to give the industry all the regulations that they were hoping for in 2017 and 2018 and that will be more than enough to allow them to move forward in a big way. So, I don’t expect the Clarity Act to move, but I don’t really think it will matter because I think the SEC will do a good job on this.
03:00 Speaker A
So Brady, I think the big question then becomes: If the SEC gives the industry everything it wants, the critics would say, oh, right? There are warning signs here. Whatever the industry wants may not be good for investors. So, I guess, what’s the chance of something happening, right? Um, you know, there’s some sort of explosion or public risk of some sort hanging over the four.
03:32 Brady
Yeah, great question. I mean, notably, I don’t mean give them everything they want. I think they’ll give them enough for this to move forward in a solid way. I don’t want to exaggerate here. but uh there, you know, it’s in particular, I think one thing that people don’t understand about the way regulation works in the United States is that we have a regime based on disclosure. This means we expect our regulators to ensure that investors have enough information to move forward. Unfortunately, the old SEC seemed to think its job was to prevent the public from investing in things it didn’t want the public to invest in. And that’s just not how security laws were set up in the United States. So expect the SEC to create rules to let people know what they’re actually buying into, but they’re not there to hold investors’ hands. So I guess that’s the first thing. The second thing is I honestly think another giant explosion is probably going to happen. you know, I mean, I don’t really think crypto has had its um.com moment yet. So, yes, it will likely happen and people should proceed with caution in the crypto market, just as they should proceed with caution in any area of investing.
04:54 Speaker A
And I know you’re particularly watching prediction markets, which we don’t necessarily automatically think of as crypto markets, but a lot of them are set up and backed by blockchain. That’s how they work. Um and so, uh, what could happen, I mean, we’ve already seen tremendous growth in this area. How will it happen?
05:22 Brady
Yeah, I mean, prediction markets aren’t inherently crypto, but they definitely have crypto vibes. You know that the crypto world has always been around prediction markets long before it became reality. So I think they are related. Um, I think prediction markets have a very bright future. I think they will only increase from here. You know, your viewers may not realize that there is as much volume in the prediction markets right now as there was at the height of the election in 2024. People are using them for a lot more things. Um, but it’s an interesting new world that we’re entering into and I kind of think we’re going to see something troubling happen in the prediction markets. You know, for example, someone might predict that a CEO is going to like lose his job and then do things to make that happen. You know, I think there will be ways in which prediction markets will not only help us understand what’s going to happen in the world, but actually influence what’s going to happen in the world. And once that becomes clear to policymakers, I think they’ll be a little more worried about the sector. That’s not to say that I think it should go away, it’s just that I think we’re going to have to face this reality that they’re not entirely a neutral force in society.
06:59 Speaker A
Yes, I think that’s the kind of concern about them. Do you think the current regulatory regime could really do anything about this?
07:08 Brady
Um, I think they’ll keep an eye on it. Yeah, I think that, you know, it probably makes sense to let the world actually find out what the problems are before we make rules to stop the problems rather than trying to anticipate the problems in advance, you know?
07:27 Speaker A
I guess we’ll see once it’s clear what it is. Brady, thank you very much. Enjoy your time this morning.
07:34 Brady
Thank you for inviting me.
07:35 Speaker A
THANKS.
