Does cryptocurrency have any value to society?

Published Feb 14, 2025, 10:00 AM

On this episode of The Middle we're asking you about what the value of cryptocurrency really is to society. Jeremy is joined by Christopher Vecchio, head of Futures and Forex at TastyLive and Axios crypto reporter Brady Dale. The Middle's house DJ Tolliver joins as well, plus callers from around the country. #crypto #cryptocurrency #bitcoin #ethereum #SEC #blockchain

The Middle is supported by Journalism Funding Partners, a nonprofit organization striving to increase the sustainability of local journalism by building connections between donors and news organizations. More information on how you can support the Middle at Listen to them Middle dot com.

Welcome to the Middle.

I'm Jeremy Hobson along with our house DJ Tolliver and Taliver.

We have a complicated topic this hour.

Jeremy, you know, I'm a DJ man. I cannot keep up with us. Just go for DJ and A can't.

Well, Okay, it's not complicated for everybody. It is complicated for some people, but some people are super into it and we probably all need to know more about it because it may soon affect all of us. I'm talking about crypto currency, things like Bitcoin, ethereum, Tether, et cetera.

Jeremy, when we get in the middle coin man, the.

Middle coin is not coming anytime soon. But you know, the total value Tolliver of all these cryptocurrencies is now more than three trillion dollars, which is about the same as the GDP of the United Kingdom.

President Trump has.

Been very bullish about crypto after many in the industry backed his campaign I'm laying out my plan to ensure that the United States will be the crypto capital of the planet and the bitcoin superpower of the world.

And we'll get it done.

Trump even launched his own personally branded trump Coin right before being inaugurated, making millions of dollars in fees at least. But aside from making investors money or losing them money, does crypto actually have any value for society or is it just another way for rich people to gamble with their money. Our number is eight four four four middle that's eight four four four six four three three five three. And we'll get to your calls in just a moment. But first, last week we asked you if you were prepared for the next natural disaster. We got into questions about the future of FEMA. Here are some of the messages we got after the show.

Hi, this is Benjamin from Los Angeles. As someone who is seeing the disasters in California become more and more rapid, I think it's really important to point out that preparation isn't just a once a year thing.

This is Patricia's doubt.

I'm from San Antonio. When Hurricane Katrina happened, i was north of New Orleans. We didn't have power for three months and we had meals ready to eat delivered by FEMA, and I know that you know there was a flow response from the federal government and all of that, but without that, I don't know how any of us could have made it.

My name is Clinton Adams. I'm calling from Michigan. One of the things a lot of people don't necessarily think about is what resiliency you need. You can prepare yourself as much as you want for a disruption, but there's so many small things that you don't think about.

Well, thanks to everyone who called in.

So now to our question this hour, what is the value of cryptocurrency to societ tolliver?

Can you give us the number? Please?

Yeah, it's eight four four four Middle of that's eight four four four six four three three five three. We can write to us to listen to the middle dot com and you can also comment on our live stream on YouTube, TikTok, Facebook, Instagram, and twitch where everywhere.

We're now on Blue Sky too. Let's meet our panel, but not with the live stream yet. Brady Dale is with us. He covers crypto for Axios and is the author of SBF how the FTX bankruptcy unwound. Crypto's very bad good guy SBF, of course, being Sam Bankman Freed Brady.

Welcome to the middle, Thanks for having me.

And Christopher Vecchio is with us. He's head of Futures and Fox at Tasty Live. Christopher, welcome to you.

Good to see you again. Jeremy, good to see you.

And just to our audience knows, Tasty Live is not like door Dash or Postmates or something like that.

Sure, our founder is a big fan of the cherry, so Tasty trade is the u.

N I see. Okay, great well, Christopher.

You and I have talked before, and I always like talk to you about crypto because you get it, but you also help people like me who for whom it is sometimes very complicated. Why don't you give us first, just the basic definition of cryptocurrency and is it different now than it was when it all started fifteen or so years ago.

I think when you and I first spoke about crypto was maybe March twenty twelve or twenty thirteen. I only remember because the Knicks were playing the Heat that night. It was a big Carmelo Anthony and Mari Stodami versus the game, and you asked me would you trade bitcoin when you trade crypto? And I said, well, I'd hold it, but like trading it, I'd rather gamble on the next heat game. And fundamentally, over time, I don't really think that's changed. There have been a lot of new cryptocurrencies or icos coins that have come into the space. Of course, they're now companies like Pump dot fund that allow anyone basically to create their own coin. If you wanted to create a middle coin tollivery, you can do that yourself there right, Oh wow. But what has fundamentally changed in the space. I mean, you could argue that more companies are using it for treasury. There are companies that are producing blockchain applications now, from IBM to SAP, to Amazon or Microsoft. You could likewise argue that it's going on to sovereign balance sheet. So it's certainly taken on more of a role as that digital gold. But does it provide any value to society I think is a different question than is it really changing or doing anything? Since you and I last spoke over a decade ago.

And Brady, there's been a big debate over the years about it and whether it is too risky for governments to officially sanction it, that it can be used for money laundering, that it could be a threat to the financial system. Let's talk about the pros and the cons. And the cons first, what are they?

Well, I mean, you know, the cons are like anything useful in the world. Criminals can use it, of course, and it's always going to be the people who most need alternatives who will move to alternative things first. But the line that I like to give on this is, you know, cryptocurrency is useful for prime and other destructive things. But you know, so our roads, the internet, and duct tape, and we still use all of those things, right, So useful things will be used by everyone.

What about the pros.

What do the proponents of cryptos say about why it is useful and why it would even be a good reserve currency for some countries.

Well, you know, on the useful thing, I'm going to give you the most abstract answer, which probably you'll hate, but I actually think it's the most important one. The thing that cryptocurrency is money native to the Internet, and what it gives people is a chance for exit. So if you believe that anyone anywhere might ever live in a place in which there could be too much restriction on their lives. Cryptocurrency provides a way that you can route around those controls, at least in terms of your money and your wealth, right, And that's why it makes some governments nervous because it routes around their authority. But if you think that there's any government in the world that maybe is not kind to its citizens and might need some way to get around their authority, cryptocurrency is an alternative, right, So I mean that is the core use. We can get into a million things from there. You know, you can move money around the world more quickly and more efficiently. It's great for all kinds of businesses. You can pay people around the world really quickly. But that is the core use. It gives people a way around control systems, and I think that's useful.

Christopher.

Only about seventeen percent of Americans have invested in cryptocurrency, that's according to Pew research. Is it a different investment for those people than say a stock.

Yes, there is a much higher degree of volatility than simply owning the S and P five hundred decks or even picking an individual stock out of the pile like an apple or an Amazon if we wanted to really be clear about comparable volatility levels, you're thinking more on the scale of like OTC pink sheets than a megacap tech name. But the fact of the matter is that studies have shown that, given crypto's evolution over the past decade plus, having a small allocation in your portfolio actually is additive. It reduces the overall correlation of assets held in your portfolio, and it can be something that adds a little bit of alpha. So a good deal of research that's come out in recent years about a three to four percent allocation over the past decade has helped a portfolio outperform the typical sixty forty stock bond split. But it's not really for the faint of heart. And this goes back to the conversation you and I first spoke about. It is perhaps an investing vehicle, a trading vehicle, certainly not for the average citizen.

Let's go to the phones and Jeff, who's in Lansing, Michigan.

Jeff, welcome to the middle. Go ahead. Do you think crypto has value for society?

Absolutely, But I would the shade on it that I want to spread is that bitcoin is really the only crypto, and it's really a shame that we're talking about anything else because the alternatives that have sprung up are really scams and not good and they really bring bad news to the Bitcoin name and what it can do, and what it can do is bring a digital sound money that helps resist the tendencies of governments to make an abundance currency and spend it and then lead to inflation, which is a cycle we've been going through since seventy three, the destruction of the gold standard and so on. And there's a lot of elegance and bitcoin that's totally Bitcoin creates the ecosystem, walked through the door and shut it behind it, and there's nothing that can approach what what bitcoin is accomplished or will accomplish.

And Jeff, when did you buy your first bitcoin? Because I assume you own at least a bitcoin at this point.

Oh well, if you don't usually divulge, you know when.

You right, because Jeff has now got hundreds of millions of dollars.

Jeff, thank you very much for by.

Brady, what about that that he says bitcoin is the only one that's.

You know, that's the bitcoin maximen's position. I love coin maxis I love other true believers. It's great. I don't think that. I think there's a lot of other cryptocurrencies out there that are doing useful, interesting.

Things, you know.

Most notably, Bitcoin brought this idea of money on the Internet, and Ethereum brought along this idea of you know what if we could have a shared computer that works all around the world, and you could make money programmable, and you could do all this wild stuff that no one can really control.

You know.

The cool thing that Ethereum can do is you can set up, you know, companies. For example, there's this exchange uni swap that exists on the Ethereum world computer, and you could lock up, you know, fire every person who's ever worked for Uni swap in history. Uniswap would run as long as Ethereum keeps running. It doesn't need people to operate. That's a new thing that exists in the world. I think that's pretty interesting. So I think some other things are useful besides bitcoin, but I think bitcoin's great.

Jeff, So also I agree with you on that point.

Interesting, you know, Tolliver, one of the most prominent skeptics of cryptocurrency has been the billionaire investor and Berkshire Hathaway chairman Warren Buffett.

Okay, shocker by all means skip the daily coffee purges, but don't let Uncle Warren catch you investing in any meme coins. Here he is explaining his view on CNBC back in twenty eighteen.

When we buy a business, we look at what the business earns and decide how we feel about it in terms of what we paid. But we are buying something that at the end of the period, we not only have what we bought in the first place, but we have something that the asset produced. And when you buy non productive assets, all you're counting on is whether the next person is going to pay you more because they're even more excited about another next person coming along. But the asset itself is creating.

Nothing, nothing from nothing, leaves nothing.

I just love that. I mean, it's you know.

I interviewed Warren Buffett once years ago, and he's famous, you know, for going to McDonald's. He loves McDonald's, And I asked him what he gets at McDonald's, and he said that he gets something called the sausage mcbuffett, which I forget exactly what it is, but it's kind of like a double SAUSAGEK McMuffin.

Or something that all take too.

Love having Warren on the show. Here, we'll be right back with more of the Middle.

This is the Middle.

I'm Jeremy Hobson. If you're just tuning, in the Middle is a national call in show. We're focused on elevating voices from the middle geographically, politically, and philosophically, or maybe you just want to meet in the middle. This hour, we're asking you what value does cryptocurrency have to society? Tolliver, what is the number of people to call in?

It's eight four four four Middle. That's eight four four four six four three three five three. You can also write to us to listen to them Middle dot com or on social media.

I'm joined by Christopher Vecchio, head of Futures and forx at Tasty Live, and Axio's crypto reporter Brady Dale. And before we get back to the phones, Brady, we mentioned that Trump launched his own cryptocurrency, Milania Trump did as well. Doesn't that raise some questions about his promotion of cryptocurrency because he now has a personal financial interest in it.

If if that were the only question it raised, you know, like I think that would be great. It raises a ton of questions. I mean, the thing that honestly makes me a little more nervous about it is I mean a it gives his you know, Maga crew a way to feel even more invested in him and sort of like never questioned a.

Single thing that he does, and he gives people a.

Way to kind of hand his family money semi on the sly and so yeah, there's a lot of weird things about it that broadly the industry other than the people deeply in like that particular category, you know, meme Coins was not excited about it.

They didn't think it helped their cause a lot. So yeah, it was a strange.

Move, Christopher.

The Trump administration has already started to scale back a unit at the Securities and Exchange Commission that was supposed to handle crypto enforcement. What kind of change will occur if the administration reduces any regulation that did exist on cryptoh Well, first.

Off, they've already made a change sec staff. Accounting Bolton one twenty one was rescinded right at the start of the Trump term, and this deals with some of the accounting practices related to crypto holdings on companies balance sheets. Ultimately, you know, I've seen some people say that it's akin to the repeal of glass steegel. I don't think that's the case. In reality, it's it perhaps adds a little bit more risk to companies that are operating this because they don't need to have safeguard assets on their balance sheets to offset the liability of the crypto holdings, and perhaps it obfuscates their crypto holdings all together. But beyond that, I mean, really we're looking for the regulatory framework. David Sachs was appointed to figure this out within one hundred and eighty days as part of the.

Crypto Task Force.

It looks like they're trying to step away though they want to give room for, as they're calling it, innovation. I would question whether or not that's ultimately a good move, because in conjunction with what we're seeing at the Consumer Financial Protection Bureau, one would think that a deregulated crypto market along the lines with fewer guardrails to protect tel consumers makes for a little bit of a riskier situation. So I don't want to sound like a bitcoin maximalist either, but the fact of the matter is that is something I've been wrong about. When you and I spoke over a decade ago for the first time, I said bitcoins the first, it probably won't be the last.

And it wasn't like the last. Jump in on that one.

I mean, a core of the question is this idea of regulations being rolled back. And the truth is there were never really any regulations written that had cryptocurrency in mind, right, So it was kind of a square peg, round hole situation. And in fact, when coinbase asked the Gensler SEC for regulations that were fit to purpose, they refused to do it and actually went to court. So and that court is that court battle has been battling out and it's not looking amazing for the SEC. So the truth is there's not really regulations to roll back. They never really did them in the first place.

Brady can ask you a quick question, do you think maybe this is crazy? Do you think this administration is likely to put any guardrails on this on bitcoin?

Well, I think Hester Pierce, the woman who is the acting chair of the SEC, has been interested in this industry for a really long time and it has been paying close attention to it, and she's the one who's actually in charge. I don't really think that she's someone who's trying to just sort of like let a libertarian panacea go. And I think she's been paying attention to it for a long time. So I actually think some rules will come, but you know, we'll have to see. I don't know, but it's just the truth is, no specific rules were ever.

Made that fit this new kind of thing in the world.

Let's go to the phones, and Tempest is on the lines from outside Philadelphia.

Tempest, welcome to the middle.

Go ahead, Hi, how are you doing great?

What do you think?

Do you think bitcoin has value for society?

Yes?

I do, but unfortunately I'm paranoid about any kind of electronic payments. I actually just got off work. I'm as stripper and I had a guy paying in bitcoin today because he ran out of money.

Well, how that work?

And you accepted it?

Of course I did.

I wanted my money.

How did you accept?

I charged?

I have my own bitcoin, I have my own little crypto wallet. I don't really Yeah, I don't like using bitcoin or electronic transfers, but I was. It was either wait for him to sober up and drive to another ATM, or take him on his word. And hopefully he had the money, which he did. Plus I charged him. I charged him an idiot tax, so I made out pretty good today.

That's good, Tempes.

Thank you for I think you're the first time we've ever had a stripper call.

Into the show. I appreciates that. That again, maybe not the last Tempest.

Thank you.

Go ahead, Yeah, I listened to you all the time. Anyways, you guys rock awesome.

Thank you so much, Tempest.

And you know, Christopher Vecchio, that actually is surprised to me, not that Tempest is a stripper, but the fact that people are accepting bitcoin in that way, that she has a bitcoin wallet, that she can do that.

Well, you know, there's a certain fungibility and you can easily transact in it. Right if I accept bitcoin right now, there's almost there's very little friction for me to go convert that back into US dollars. And this is something that companies have done in recent years. Overstock dot Com, when they first started accepting bitcoin, they weren't keeping it on their balance sheet. They were immediately converting back to usd So if businesses can do it, why couldn't an individual with their own wallet. It is another one of those ways that it kind of is fulfilling its original person purpose as a peer to peer transaction network outside of the reach of the banking system.

Let's go to Eric, who is in Tampa, Florida. Eric, welcome to the middle of your thoughts on cryptocurrency and their value to society.

Hey there, So, I'm an environmental hythropologist, and I think if we're going to be looking at the value of crypto, we have to be looking at the raw environmental value, specifically the amount of resources, the amount of fossil fuels that it takes to mine bitcoin and to keep a whole system running at a base level. Because if we're thinking about really the value of anything, we have to track how it goes back to the environment. We can't eat money, we can't breathe money, we can't live in houses made of ones and zeros. So carbon emissions are carbon emissions, and we have to keep track of that really real aspect of it.

I'm so glad you brought that up, Eric, because it's a big issue that people talk about in this industry.

Brady, what about that?

What about the environmental impact as people mine bitcoins and other crypto?

So, before I became a reporter, I spent a few years as a full time environmental activist. Is a topic I care a lot about, and I think this is one of those issues that just sort of proves if somebody repeats something often enough, people will just to believe it. But the truth is, there just isn't a lot of materiality to it. And one of the ways you can look at that is you can note that for the whole history of bitcoin, you know, over the past like fifteen years, use of electricity in the US has basically been flat.

There just really hasn't been much change.

And the only thing that actually changed is very recently the introduction of AI. I mean, if folks care about, you know, environmental impacts, that is a thing that actually has changed the game. But cryptocurrency just didn't really, And in fact, cryptocurrency has helped a lot of new forms of alternative energy come onto line online because bitcoin's always ready to buy into those new areas. So I just think this is a really escapegoating situation. It's just some folks, you know, who care about the environment want to look something simple to point their fingers at.

It's become bitcoin.

But it's just really it's not material in terms of global impact.

Christophervecia, do you agree with that? I think that's fair.

I mean, US carbon emissions are down to seventeen percent from two thousand and five. And you know, I don't recall a single company announcing that it was opening a new nuclear plant right for any bitcoin mining operations. There were a few things like an old natural coal facility that might be opened, to an old hydro plant that could be reused for this. But yeah, there's a lot of bitcoin electric electrically use worldwide, but here in the United States that's not necessarily the case. And yeah, to Bratti's point, if we're really concerned about emissions from a new technology, these data centers that are going up around the country right now, we have done a very poor job scaling for the future by essuwing nuclear for the past decades, and as a result, the only thing to fill the gap right now are fossil fuels. So the AI revolution, not the bitcoin one, is probably going to be carrying higher carbon loads moving forward.

There's a giant gap between California and the entire rest of the country on energy conservation. If folks want to do make a difference about impacting the environment, Like, have the rest of the country catch up with California on how efficiently they use power.

Don't worry about.

Bitcoin, Tulliver, some messages coming in online.

Yeah, Samantha and North Carolina says, I think bitcoin is not good for society. It's just another tech bro hype scheme. Wow, lots of promise and little return for the greater general everyday people. Is an inflated currency, currency that has no security, very loose if any regulation around it. And then Ryan and Pittsburgh says, as I learn more about cryptocurrency, I'm increasingly reminded of the stock market crash of nineteen twenty nine, the dot com bubble of two thousand, and the housing crisis of two thousand and eight. Each time our national well being was immeasurably hurt was when these booms and easy money exploded in our faces.

Fright, you know, let's talk about that for a second, Brady the I'm old enough. We're all old enough to remember the financial collapse of two thousand and eight, when you know, underregulated mortgage backed securities ended up taking down the financial system and causing a great recession that took many, many.

Years to recover from.

Is there a worry that, you know, as more people start using crypto and it doesn't have adequate regulation, that it could end up taking down other aspects of the economy.

Well, I don't think so.

Chris might have a different take on this, But you know what, the reason two thousand and eight hurt us all so much. Part of it was because a lot of people lost their homes, obviously, but for the national level pain I was actually intimately involved in this one. It's because the government came in and sort of bailed the banks out, right, So that's how we socialized the cost. If you can really imagine the government coming in to bail out the bitcoin crowd, I can't imagine it, right, like, so there is, but.

It was also because it was also because the banks were involved in these loans, and then there therefore it sort of hurt the financial system. Lending became very difficult, Mortgage lending became very difficult. And could bitcoin have that effect if the banks start taking on more cryptocurrency and then there's a crash, well, you would.

Have to imagine that the banks would start lending against bitcoin, you know, and they would start lending against cryptocurrency for that to happen. I mean, they need to be like taking on that kind of risk, and we just really don't see the traditional financial system showing interest in that kind of thing.

So I just I don't.

See with the crypto world that we have right now the risk of it rippling out like that. You know, there could be something that I'm missing, but I just don't really see it. I think there is. I've seen it a ton of times. People get into deep they take too big of a risk. It hurts them personally. I just haven't seen cases where that risk has become socialized, you know what I mean.

And what do you think, Christopher?

Yeah, I think right now, to suggest that there's systemic risk would or that is even close to systemic risk for the financial system would be disingenuous. Couldn't get there, sure. I mean, if a company like Microsoft takes bitcoin onto its balance sheet to a large enough degree and then Bitcoin tanks, that causes a huge problem for Microsoft, one of our country's largest companies and a significant employer. We recently saw that Microsoft shareholder shot down that proposal to have bitcoin on the balance sheet overwhelmingly, like a margin grid than nine to one in terms of the vote. If a company like Strategy formally micro Strategy Microsof's company gets included into the S and P five hundred, that could cause some index risk, But again for everyday Americans. You know, there was a really great documentary from Dan Olsen. He is of the Folding Ideas YouTube channel. He did a documentary a few years years ago called Line Goes Up about why this crypto industry really sprung up, and it was in response to the global financial crisis that people were getting bailed out without account they weren't being held accountable, and this destruction was laid to waste. So we needed to have a system for other people that they could rely on themselves. It's not a systemic risk though right now. Could it be if it gets integrated into mainstream finance perhaps, but we're not there right Let's go to people.

Should be careful.

You can't hurt yourself in this industry, and so that caution is correct, like, be careful if you go, if you go in.

Mark is calling from Pittsburgh, Pennsylvania. Mark, Welcome to the middle.

Go ahead.

Hitcoin and crypto in general has absolutely no value to society when you consider it. It's backed by nothing, It's an asset that exists only because people want it and not because it has any intrinsic value. It's not like currency, which can actually buy something and is backed by the full face and credit of the US government, even though it's not backed by the gold standard anymore. Uh, it's just it's just there. It's nothing.

Hmm, thank you for calling. Uh Mark interesting, Brady, what do you think about that? Not not backed by anything? Set sounds like Warren Buffett.

I think if you dig deeferently enough into any money, it's all a fiction. So I don't know. You know, I can make an argument that.

It's backed by its security system, which is, you know, very powerful and has never been broken. But I think at the end of the day, money is a social fiction. It's an alternative money. It's useful to send people.

Okay, Mo is calling from Denver. Hi, Mo, welcome to the middle What do you think?

Wow?

Hey guys, thanks very me on. Yeah. I'm a digital artist that fell in love with NFTs in twenty twenty, but I had been messing around with, you know, some coinbased trading lightly a little bit before that. I first researched bitcoined in twenty eleven when it was fifteen hundred dollars and I didn't realize that you could buy a fraction of it, So I faded it, as they say. And years later when someone told me I could sell my digital art as NFTs, I like lost it. I'm a technophile, I was like a BBS nerd way back in the day, and so I fell in love with the real world utility of not only cryptocurrency, but NFTs and even now beyond that. Right now there's a whole AI tech renaissance happening on the Solana and based chains where people are developing AI agents that unautonomously can launch their own meme coins managed I trade them, breed their own new agents. It's literally like as an artist and a tech nerd, it's an absolute renaissance right now. And so yeah, I'm just like them.

So let me ask you.

Let me just ask you one follow up question mode, which is, uh, with the NFTs, how come I what would stop me from just taking a picture of your NFT and then saying that I own it.

Well, you can absolutely do that, but it's not doesn't have a contract, it's connected and launched by my wallet. As an artist, the same way you could walk up to the Mona Lisa and take a picture of it and say you own that, but you don't, you know what I'm saying. So like there's actual digital contract acts behind these things that proved that it comes for me as an artist.

Okay, mo, thank.

You very much, like mode, that's my kind of guy man.

Yeah, right, the Mona Lisa. You know, Tolliver the current value of bitcoins, so most said, what eleven hundred dollars back in the day that it was about eleven hundred dollars. Now it's like around one hundred thousand dollars. But there was a time when people were using it on any old random purchase.

Like pizza or dancers. Back in two thousand and nine, Laslohanya traded ten thousand bit coins for two Papa John's pizzas. He was later interviewed by Anderson Cooper in sixty minutes about it.

By the time of our interview, those bitcoins would have been worth.

About eight hundred million dollars.

Yeah, so okay, sorry, let's just get this straight.

You should spend about eight hundred million dollars on pizzas well. If you look at today's exchange.

Are there nights you wake up like in a cold sweat where you think I could have heard eight hundre million dollars if I hadn't bought those pizzas. I think thinking like that is not really good for me.

That's like fifty million a slice.

You don't know how many pizzas he got. It could have been like one hundred pizzas. Then it would have been fully what eight million of slice. Anyway, we'll be right back with more of your calls coming up on the Middle. This is the Middle. I'm Jeremy Hobson. In this hour, we're asking you what value cryptocurrency has to society as a whole. You can call us at eight four four four Middle, that's eight four four four six four three three five three, or you can reach out at listen to Themiddle dot com. My guests are Axio's crypto reporter Brady Dale and Christopher Vecchio, who's head of Futures and forx at Tasty Live. Let's go back to the phones because they're full. I didn't know was it gonna happen this hour. A lot of people are gonna call in to talk about this. They are sam Is in Atlanta, Sam, Welcome to the middle. What do you think does crypto have any value for society?

No, I think it's gonna be ultimately shown to be a tulip frenzy on myth that there's no value to it. That it's not like owning timberland or utility company's stock or anything like that. It's just a fad, and it's a fad that's easily duplicated by other cryptocurrencies being created by someone sitting down on the computer and creating a cryptocurrency. It appeals to libertarian conservatives because they like the idea of somehow privatizing the means of exchange, but that's not possible for all the problems we have in America with inflation and irresponsible economic policies. The official currency is backed by the compulsory force of government, and therefore it has value. But there's nothing behind Bitcoin of the other cryptocurrencies. They're just a fad and some.

Day coin Sam as some kind of a hedge against inflation.

No, of course not. It has no value. I like what Royn Buffetts said in your but you say it's just true. It's just nothing. It doesn't you know when you pull the plug on it, it's gonna have no value at all.

Yeah, Christopher Vecchio, what do you say to Sam.

While there may be no backing like gold or an army to collect taxes at the end of a barrel of a gun, the fact of the matter is that bitcoin and various cryptocurrencies have very strong networking effects. If enough people believe in something and say that it has value, it's going to retain a good deal of value. I mean, in a very simplistic way, It's kind of like a beanie baby or a baseball card. If enough baseball fans agree that this card has value and it's in a limited supply, it's going to fetch a value and an armslength transaction in the market. So right now, enough people believe this thing is not a house of cards, and thus it's trading at near one hundred thousand dollars.

Well, and that gets us, Brady to block chain, which is a part of this, and it's a little complex, but can you explain how blockchain helps people give value to bitcoin?

So yeah, sure, So I've got a new explanation to try on your listeners of this. So you know, what cryptocurrencies do. What blockchains do is allow us to exchange value to sort of defeat this double spin problem where I can send something to you and you have it and I don't. Right, And we do a different version of this digitally all the time. Right now, we send pictures to other people. But you know, when we send a picture to somebody else, we're not actually sending them a picture like we used to do with the mail. You send a postcard to somebody, you had the picture, now you don't, they have the picture. You don't like it actually would change hands. Right when you send a picture now with your phone, you're actually just making a bunch of copies.

It's a copying machine, right.

And so cryptocurrency came along, when blockchains came along and provided a way that with something digital you actually really could do the same thing you used to do with a postcard. You would no longer have it, and somebody else did doing that with a picture. Well, blockchains allow you to do that with money with value, and so that's the purpose of blockchains. That's the problem that they solve and allows you to have financial exchanges on the internet.

And I think that's nice.

You know, it's true that money in the US works pretty well, but I don't know about y'all, but sometimes I buy games on the internet, right, and it annoys me that I need to put in a credit card and put in my address and put in my phone number every time I buy a digital game on the internet. That seems silly to me. I would like to be able to make that a cash transaction, to be able to have a little bit of money loaded in my crypto wallet and to just pay for it that way. And they don't need to know who I am. I don't even know who they are. I just got the game that seems like a better world in a small way to me. And we can do that with cryptocurrency. You cannot possibly do that with US dollars, and so I do think that's a difference.

Let's go to Bethany, who's in Denver, Colorado. Bethany, welcome to the middle.

Go ahead with your thoughts.

Hello, guys, Yes, I'm just calling. I work in finance and in financial advising, and while I do think crypto has some utilitarian purposes, absolutely, I think that there is a necessity for there to be some, at least my minor regulations, the same way there is at the end of a fidelity co commercial or a Charles Schwab commercial that says, you know, investing involves the risk of loss. I've worked with people who have lost half or more of their retirement savings by putting their you know, ira into crypto or putting their savings into crypto when they don't understand it. And these are people in their seventies or eighties that hear Trump say crypto is good, and just like a gentleman I'm working with this week, he put five hundred thousand dollars into bitcoin and then a week lost fifty thousand dollars and then is calling me panicking. So I don't think that crypto is inherently bad. I think it's a lack of understanding and a lack of warning that that needs to be addressed.

Bethany, what percentage of your clients would you say have asked to get into crypto?

I would say on.

A daily basis, I've probably talked to at least one person who's interested in crypto. Obviously, it's not something that's regulated by FINRA or the SEC, and it's not something that we can recommend or really speak on. So I would say probably ten to twenty percent of the people that come to us through planning and with questions are asking about crypto and.

Do they want bitcoin or do they want something else.

Bitcoin? Mostly, I don't think any of them even know experium exists. Like those knowledge is that limited that they don't even really know what it is, and bitcoin is just the word that they've heard.

Bethany, thank you for that.

Christopher Veckio, what do you think about that financial advisor who wants a little bit more regulation of bitcoorin or at least some warnings for people who I guess think that it can only go up.

Eric, That's where we're trying to feel out with this Trump term and what's going to happen under the SEC and CFTC and these various regulators. Are we cutting red tape or are we removing the guardrails? And there is a fine distinction between the two. As Brady pointed out, there really haven't been any guardrails. I mean, the whole industry has been poking around in the dark trying to feel things out, and the SEC has more or less been playing Marco polo with them. It's been an operation of discovery. Yeah, there needs to be safeguards, of course, but you don't need to hold the bitcoin yourself. There are ETFs now that provide exposure to this, that provide the custody solution. For example, you can go to Blackrock right now and just buy some ibit and it's an ETF like Spy or Triple Ques what have you. So again, it's all about allocation and risk tolerance here. If you are younger, you could probably have a little bit more in your portfolio if you are close to retirement. As one of my college professors used to say, certain people don't buy green bananas. If you're the kind of person who doesn't buy green bananas, then you probably shouldn't be holding something so viotile so close to the end of your life savings.

Nathaniel is calling from Evansville, Indiana, where we just did the show in the last couple of weeks.

Nathaniel, welcome to the middle. What do you think about cryptocurrency?

Well, I have someone who's done a little bit of investing, both in the stock market and in bitcoin. I found bitcoin to be more reliable. I invested in some tech stocks Life and Video and Microsoft, and well, when things like that went down and down south, bitcoin still remained to study uprising. Now I don't have fifty thousand dollars or something like previous callers had mentioned, but on a smaller scale it felt more stable.

And have you is it mainly Bitcoin that you're that you're investing in or are you looking at the others as well?

Finally, that's the main one of that's that I have been looking to, mainly because of the longevy that it's been around and just general knowledge about it.

Yeah, Nathaniel, thank you very much.

Uh Brady, he mentioned tech stocks. One thing that is very interesting about bitcoin and cryptocurrency is that they do tend to follow the tech stocks up and down in the market.

Well they follow them up and down in the short term, right, but when you zoom out there there is a difference. We ran the numbers a little while back. It turns out that, like any the reason people lose a lot of money in crypto is because they get scared by the spikiness. And that scares you. You should probably stay out and just not have that much in there.

But we ran the.

Numbers a little while back. No one who's held bitcoin for four years or longer has ever lost money. In fact, they've all made a decent amount, and even significantly less than that. It's been pretty unlikely that you've lost money. It's just if you're going to get into this space, don't get into heavily so it scares you, and just stick around. Like Christopher said early on, like it's not about trading, it's about holding.

But just don't hold. Morphan's going to freak you out, you know.

Brendan's calling from Chicago. Brendan, Hi, Welcome to the middle.

Hey.

I heard a lot of callers talking about crypto and bitcoin and relatively short time horizon, and I think people need to reframe a little bit how they think about it. I think if you look at crypto on a ten twenty thirty year time horizon, you're going to see societal change at scale, So you know, I think an interesting example is something like the stimulus checks and the rollout we had for that during the pandemic. If you can imagine a future where your tax payer ID is associated with the wallet and the government is able to just send a check directly to you, and you have a one on one account that's authenticated and validated with the blockchain, you can send out stimulus checks instantaneously. You start to stick at the whole scale, you know, just change of how value flows at a society level and the way we organize as people. So yeah, I mean, I think bitcoin is some of the callers to mentions is a hedge against governments and inflation. I think there's a lot of exciting things happening with NFTs, but like these are you know, smaller things that are part of the larger trend which is just in the background. A lot of things will change because they'll run on systems around different blockchains.

M Brendan, Thank you, Christopher.

You know, he talks about sort of distrust of government, a hedge against inflation. But I also wonder in a world that he describes, isn't it so much easier for a hacker to get in and steal all of our money?

That is a concern, And with recent advances in quantum computing, at least those that have been made public, there have been conversations about this. Bitcoin's encryption is very secure. No computer today is going to be able to crack it. But I think what this caller is, you know, alluding to, and something that Brady brought up at the top of the show is the portability and our conversation is actually very American centric. You know, the idea that I could be a citizen than a foreign land where my access to banking may be limited and there may be exceptional volatility in my own country's exchange rate. I now have the ability to take whatever I earn and put it into a cryptocurrency wallet, perhaps pegging it to the US dollar. I could just buy some tether. I'm now protected in my own country from that problem. And if I need to leave that country, I can simply just pack up what I need to take with me and go and my assets will come with me.

So it is.

It actually has a very useful tool. And I think that as Americans, if we are really concerned with you know, keeping at Bay, China, Iran, Russia, we should absolutely welcome the hegemonic value that bitcoin affords to the US dollar.

Brady, Do we see a lot of people using bitcoin for that reason in places like Venezuela where the inflation has been out of control, Yeah.

You see that, there's been a Especially it's the stable coins that have really been powerful for people who care about money. So tons of people around the world are discovering stable coins. They're using them, you know, yeah, like Chris said, to just sort of hold onto their cash to get away from that risk of inflation. They're also using them to access yield that they couldn't otherwise access. So with a stable coin, you can go onto the Ethereum blockchain and a variety of different ways you can access you know, US treasury yields, which you know may not be accessible for people in a lot of and a lot of countries. And so yeah, people around the world are more and more discovering cryptocurrency in places where traditional finance isn't working great and it's and it's giving them options.

Let's get to Matthew, who is in Flint, Michigan.

Matthew, welcome to the middle your thoughts on crypto and its value to society.

I would just like to know what would be a backup plan if something like say internet cable gets cut by Russia and the Baltic Sea happens in America or to wherever the servers for bitcoin or cryptocurrency are housed, like say Russia and Trump set World War three. What's going to happen when all everything goes say wire to cryptocurrency.

Christopher Vecchio, what do you think.

Right now, the Bitcoin network runs not in the centralized location, so there's not going to be a single EMP blast from a nuclear warhead going off that ultimately takes down the Bitcoin network. There are decentralized nodes everywhere, and the way that they Bitcoin network worse with proof of steak, all miners basically everyone who's on the ledger, for lack of a better way to put this, they all have to agree that this is a legitimate coin mind and that the adjustments made to the ledger are above board. So in the event that something happened that took down a Bitcoin node, the Bitcoin network would stay up. You'd have to effectively turn off the power and wipe out computers all across the planet. Brady, maybe you know better than I, but I don't really think that's a significant issue.

No, this is one of the hardest things where people to get about cryptocurrency because it's so weird. I mean, these things are everywhere and they're nowhere. They are like cockroaches, they're next to a Boston to destroy, especially like the big ones like Bitcoin Ethereum, there's just you just can't do it.

I mean, all the governments of the world could crack.

It could could ban together and try to wreck this stuff, and at this point, it's just it's gone too far. It's it's not doable, let alone an accident like one undersea cable being kind of just it just it's just not going away.

Okay, So we're coming up to the end of the hour here, but let me ask you each one final question, Christopher. When President Trump says he wants the US to be the crypto capital of the.

World, why why Why would.

An average American want the US to be the crypto capital of the world.

Quite frankly, I think it's all about attracting capital into American borders, you know, like him or hatim. Trump's clear shtick is that we want everything made in America right now, and so I think it's just part of a broader ethos that he has that if there's a job that can be done and something can be built, that should be built here on our shores. I don't think it's a crypto specific thing. It's that crypto supported him, and therefore he wants to make sure that the crypto folks are taken care of. It's just another interest group as far as I'm concerned.

And Brady, let's go back to our original question. I want to just ask you, what do you think that crypto has value for society as a whole?

Or is it just a way.

For people to invest their money, to make money, to lose money, just like a stock or something else.

No, I do think it's more than that.

I mean, look, I don't I'm not a big libertarian or anything, but I do think if folks express that something has value by buying it, then it has value. But I've been covering this stuff since twenty seventeen. I've seen people use it a thousand different ways. It's hard to capture all the things that people are excited about in this space. And when a lot of smart people are excited about something, eventually everybody else catches on. You know, you mentioned that only seventeen percent of Americans have crypto, a nearly one in five people. That's a lot of people. More and more people are becoming convinced that there's something here and so, and having followed as long as I have, I agree with them, and I think eventually a light switch will just go off for everyone and all realizing that we've been using it for several years and aren't really thinking about it anymore, much like we did when email came along, because I was.

There for that too, you know.

Yeah, seventeen percent of Americans have invested in it. Sixteen out of the fifty states have started discussing establishing bitcoin strategic reserves. And when you look at the this was what I was worried about. Is this going to be we have an all mail panel today. Was it going to be only male callers? It wasn't, But it is true that men are much more into investing in crypto than women are, so anyway, really fascinating our Thank you so much to our guest Christopher Vecchio ahead of futures in foroex at Tasty Live and Axios crypto reporter Brady Dale.

Thank you both.

And next week, Taliver, we're going to be tackling an issue that's going on within the federal government and in private business across the country, and that is the debate between remote and in person work.

Lord.

As always, you can call it a four four four middle that's eight four four four six four three three five three, or you can reach out to Listen to the Middle dot com. You can also sign up for our weekly newsletter don't forget to check out our new video podcast on YouTube, where you can watch us as well as.

Here is you got to subscribe to that. Subscribe to our YouTube channel. The Middle is brought to you by Longnook Media, distributed by Illinois Public Media in Urbana, Illinois, and produced by Harrison Patino, Danny Alexander, Sam Burmisdas, John barth On, A. Cadessler, and Brandon Condritz. Our technical director is Jason Croft. Thanks to our satellite radio listeners, our podcast audience, and the more than four hundred and twenty public radio stations that are making it possible for people across the country to listen to The Middle, I am Jeremy Hobson and I'll talk to you next week.

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