Today the Biden Administration says it's Against the passage of the fit for the 21st century act the Trump campaign Announces it will start accepting crypto Donations and Mike novogratz Galaxy Digital's founder and CEO breaks down What advisers need to know about crypto From the CNBC financial advisor Summit welcome to cbc's crypto world I'm TAA mck major cryptocurrency is pretty Flat today with Bitcoin Rising just Under 1% and trading above $70,000 as of Noon Eastern ether dropped slightly in The past 24 hours trading at the $3,700 Level just a day before the SEC has to Decide whether to approve the first Application for a spot ether ETF salana Meantime climbed more than 2 and a half% Ether's muted trading comes after a Two-day rally thanks to reports that the SEC had requested key document updates From potential spot ether ETF issuers And exchanges Traders took those Headlines as a sign that the SEC was Poised to approve spot ether ETFs but an Agency spokesperson told CNBC it does Not comment on individual filings final Decisions on applications by Vanek and Arc are due tomorrow and Friday Respectively Black Rock and grayscale Are among the asset managers that also Have applications pending before the SEC Sibo and exchange associated with five Asset managers with pending applications
For spot ether ETFs published amended Filings yesterday in response to the Feedback from Regulators sibo in Exchange associated with five asset Managers with pending applications Published amended filings yesterday in Response to the feedback from Regulators Those applicants include Fidelity vanc Invesco Galaxy Arc 21 shares and Franklin Templeton okay let's talk about the top Stories the Biden Administration said Today that it opposes the passage of the Financial Innovation and technology for The 21st century act a crypto Market Structure bill but that doesn't mean the President intends to veto it the White House published this statement today Saying against the bill stating concerns Over a lack of investor protections the Administration also said it's eager to Work with Congress to ensure a Comprehensive and balanced regulatory Framework for digital assets SEC chair Gary gendler also argued in a statement Today that the fit for the 21st century Act would hurt investors adding that it Would hinder the work of his agency the Bill is expected to see a vote in the House this afternoon next the Trump Campaign announced it will start Accepting crypto donations the move is Trump's latest effort to court the Crypto Crow opening a new source of
Potential funds for The Campaign which Still lags Biden in cash despite Outraising the Democratic incumbent last Month other crypto-friendly moves by Trump include a dinner for his nft Backers at his maralago Club earlier This month CNBC asked the Biden campaign About its views on accepting crypto Donations but hasn't gotten a response Yet Trump is not the first presidential Candidate to accept crypto donations Robert F Kennedy Jr who was mounting a Longshot independent bid announced last May that his campaign would accept bid Bitcoin contributions and finally a wide Range of tech companies including some Crypto firms are introducing a coalition Aimed at combating online fraud and Scams the group dubbed Tech against Scams includes crypto companies coinbase Kraken Ripple and Gemini other members Include meta and match group the parent Company of Tinder and hinge according to Match the Coalition gives members an Opportunity to share information in an Effort to prevent users from falling Victim to fraud like Pig butchering a New kind of crypto investment scam That's been gaining Traction in recent Years CH analysis describes Pig Butchering as a romance scam which got Its name because of the way Bad actors Fatten up their victims by building Trust to then get them to invest in a
Fake investment opportunity in a Statement coinbase's Chief security Officer said fraud schemes are becoming Increasingly sophisticated and that the Crypto platform is dedicated to Disrupting emerging online scams through Collaboration information sharing and Enhanced consumer Education all right for our main story Mike novag Gratz the founder and CEO of Galaxy digital spoke with Kate Rooney at Cnbc's financial advisor Summit this Morning the event brings together the Country's top advisory firms to explore The state of the markets and of course That includes digital assets the two Discussed portfolio allocation political Crypto sentiment ETFs and More uh Mike it's great to see you Thanks for being Here I'm having fun it's Bitcoin Pizza Day is that right happy Bitcoin Pizza Day Uh you know it's it's happy Bitcoin Pizza day it's happy crypto day because It feels like the politics of crypto are Shifting and what I mean by that it's You know crypto has started to look like A small group of Democrats were just Stopping any progress in in regulation And in the industry and for a bunch of Reasons President Trump saying he's the Crypto president he's accepting crypto Donations and realizing there's a
Vulnerability here in the election year Uh the Democrats are responding pretty Quickly and we're seeing things that I Couldn't have dreamed of two weeks ago Happening at a very rapid speed and That's that's really setting the table For a uh a really exciting you know few Years in this industry does that make it A safer investment or at least Recommendation from financial advisers Um that sort of regulatory Clarity that You're talking about or maybe even just More certainty in DC talk about what That mean might mean at least for Bitcoin and other cryptocurrencies as an Investment so let's start with Bitcoin The fact that the government approved an ETF that Larry Fink the largest asset Manager in the world is out there saying This should be part of every portfolio This is digital gold uh as long as the Government keeps spending recklessly Bitcoin should go higher uh you know it You can't get much more institutional Than that we're part with Invesco and in In an ETF both in Bitcoin and and now it Looks like the ethereum ETF is is going To get approved this week maybe as early As tomorrow and so for the two biggest Products to have the stamp of approval Uh from the US at one point what are you Scared of um you've got the the richest Person in Massachusetts Abby Johnson Who's been a huge crypto fan and a big
Advocate the richest person in Pennsylvania Jeff Yas big crypto fan uh You can go around Stan dren Miller Ray Delo some of the best investors in the World recognize that bitcoin's an asset That should go higher and so I just keep Asking the question what are you scared Of yeah Abby Johnson has been sort of an Under the radar Bitcoin bull but now That you're talking about the stamp of Approval if that is the case what is the Appropriate allocation for somebody Who's you know not entirely in on crypto They're looking to put a certain Percentage of their portfolio or their Client's money how should people think About This listen you know 2 to 5% think about What you do in a in a great stock uh Right how much what's what's your Allocation to Apple or Google or Microsoft uh often it's it's at least That high uh and so I would say 2 to 5% Uh you know in the whole space and you Know you can start smaller you can start With 1% what I've learned talking to People about this since 2013 I I Literally am the oldest guy in crypto uh And I've been doing this for 11 years is Get off Zero once you get off zero once you have A little bit of an allocation you start Following the story like we invest in Things that we understand and so things
That look complicated we often stay away From you learn about things by putting a Little money on the line then you pay Attention to the article you pay Attention to the interview and so if There's one message I'd send to all the The investment advisers and all their Clients is get off zero what role is That going to play within your portfolio Is it like you said the high beta Tech Name not even big Tech but are you Thinking about it as a growth allocation And if not when is it really going to Start showing up as digital gold and Sort of that safety play do you Anticipate any sort of shift there I Mean listen you know uh I have been loud And clear this year on CNBC and anywhere Else I spoke That silver gold copper Bitcoin other Crypto are all going to go from lower Left to upper right they're going to be At a Market because it's an election Year and we have a government that can't Stop spending money uh and the big the Big uh competitor Donald J Trump spent More money when he was in office than Almost any president and so you've got Populist on the left and You' got a Populist on the right and that makes for A great environment and so listen Bitcoin right now trades like it's a a Risk asset some days like it's an Inflation hedge some days you know
Similar to Gold the there's not an Immediate onetoone correlation bad good Inflation number uh you know having a Correlation it's a narrative and it's a Story and if we listen if if we get a New Administration after this election That comes in and says we are going to Buckle down and we are going to stop Spending 25% of GDP at Federal level or 26 and a half% and move that back to 20% We're going to bash the deficits we're Going to be fiscally responsible the Story for gold and Bitcoin isn't as good It just right I don't see that I don't See that happening I wonder what you Make of the wealth transfer you've got a Lot of money in the hands of baby Boomers that in the next you know decade Or so multiple decades will transfer to A new generation does that set up Bitcoin and cryptocurrencies for you Know more upside if this it's a huge Deal yeah you when shy Munger passed Away I I had typed up a cheeky tweet and I said you can't do it Charlie Munger is A legend but Char M hated Bitcoin never Understood it never took the time to one Understand it he didn't have to he was 95 years old and he made billions of Dollars doing what he did and so he Could didn't take the didn't have the in Intellectual curiosity to dig deep and Try to understand it that money his I'm Sure some of it went to you know family
Members and that were much younger uh Those guys love crypto they love they Love Bitcoin they don't love gold Right even meme stocks people like older People like I can't believe these Dogecoin what a what a waste of time you Talk to a 25-year-old and they see it Differently and so the overall space you Know having digital ass that's feeling Comfortable in a in a digital world is Just so much uh more enthusiastic the Younger you get and so we're going to See the largest transfer wealth in the History of the world from gray hair to Youth and and that's going to be great For Crypto yeah it's interesting sort of the Generational divide it seems like even Across politics you're talking about What's going on in DC it feels like There's more of a generational Gap than Almost even u a political Gap when it Comes to crypto you look at the Democrat Like guys like Richie Torres and Jake Aen Claus from Massachusetts they love Crypto they get it they did their Homework they understand it and you look At the you know the guys that are Hobbling into to congress with the gray Hair and they just it's just not as Important to them have you heard the Term Boomer coin it feels like Bitcoin As you said it's got this stamp of Approval it has actually been a lot less
Volatile we talked about the volatility Coming in Bitcoin has been a little bit Boring lately do you think I mean that's Probably a good thing for financial Advisers listening to this what is it What do you make of that the fin the Financial advisors broadly cover the $45 Trillion of Boomer wealth and so yes the The ETF is a wonderful product for them Uh how do you get started you give Someone something that they're used to Uh the EF as well and so y y my job as a Crypto evangelist has been to bring People into the tent and you know how You get into the tent is is is not as Important as getting into the tent and So I think the ETF is serving a Wonderful function and yeah Bitcoin is The Boomer coin because it's easier to Understand than the other coins and so But that's how you get involved every Single person I've turned on to bitcoin About two months later calls and says Hey tell me about that ethereum and then A month later tell me about that salana And they slowly go down this learning Curve the Bitcoin uh the crypto Community calls it The Rabbit Hole uh But it's a learning curve so you go up It not down it uh and they just get more Excited about the overall potential of The space it's the Gateway um I Mike I Want to ask you about a survey from our Fa Community this is from our events
Team they asked how like are you to Recommend Bitcoin Investments to your Clients in the next year 68% said not at All they said they're not doing it 24% Said somewhat only 8% we very likely What do you make of those results and What are you hearing from the people who Say we we're still not comfortable with It despite everything you've argued here Yeah I kind of love those results Because it tells me how much upside we Have right uh think about Larry Frink Six years ago you can find all kinds of Quotes about Larry Fink not liking this Doesn't make any sense to me doesn't Right now he's an evangelist and so the One thing about crypto is it's you've Got to sell someone they don't buy it Right crypto is sold we call it orange Pilling when you orange pill someone you Convince a skeptic that hey I I now see Why you like Bitcoin and what this ETF Has done it has gotten the sales forces Of these giant traditional Finance Organizations educated and how crypto Works and why it's important and they're Out selling and so instead of just Mike Novogratz and a few others knocking on Doors trying to convince people we have The whole Morgan sty Salesforce that's Getting educated uh and in time is going To start you know selling and let me Tell you you know we partnered up with Invesco and uh they got off to a bad
Start with the ETF and you know the ETF Went down in price and I remember Getting on a call with them I was like Dudes you got lucky that you didn't sell Anything because now you can buy it at 38 39,000 And your clients will love you if they Had listened some did uh and they got Their clients in at 40,000 and now it's Trading at 70,000 not one client's going To say dude why did you do that right The clients are going to say hey what Else can I do and so profits be get Interest and I'm telling you crypto uh If this regulatory Tha continues to Happen Bitcoin will be significantly Higher this time next year if the FED uh Ends up cutting rate and I'm not sure They will but if they end up cutting Rates Bitcoin will be significantly Higher last year and so the message I Would tell people is to get off zero get Your clients involved uh what's the Worst that can happen you put one and a Half 2% in and the thing underperforms The SNP and it's not really impacting Your portfolio allocation uh you can Look at any study about what crypto has Done it has lowered the overall uh Volatility of a portfolio and increased The revenue and so it is a sharp Ratio plus to portfolios Mike I was Going to ask you about rates you Answered my question there I wonder how
Else can you get exposure what do you Think about derivatives some of the Crypto proxies out there whether it's Coinbase or some of the mining stocks Talk about some of the crypto adjacent Names yeah I listen I think there are Not that many equities there's coinbase There's micro strategy there's a bunch Of mining stocks we are praying I say a Hil Mary and an Our Father every night That the SEC approves us to be a Us-listed stock there are three or four Other crypto stocks in the queue uh Biden's administration's SEC has not Been friendly to applicants like Ourselves and so small amount of stocks I think the miners all trade very Expensively uh doesn't mean they can't Get more expensive right these are Momentum names micro strategy trades two Times its value of Bitcoin like that is Something that is not sustainable long Term by any stretch it could go higher Because again limited names and what's Interesting is why do these names Outperform the ETF because they have Options on them the ETF doesn't have an Options market yet and all the young Kids play the options and so I think in The next two to three weeks at least two To three months you will get options on The Bitcoin ETF uh I am praying that our Stock which is you know far cheaper than Any of the the US listed stocks we trade
In Canada gets listed in the US uh and You know that there will be a big jump Then in both volume and and and Valuation um and so I think a year from Now 18 months from now instead of having Six or seven crypto stocks there'll be 26 crypto stocks and then there'll be a A stock ETF and you'll see this industry Widen and out but right now on the US Equity Market there are very few names Okay that's all for crypto today we'll Be back again tomorrow and we'll see you Then [Music]
