Transcription
Welcome back to another episode of the XRP Pod. Today is going to be a good one because we're going to be talking about XRP and the new financial order, and I'm going to do it with two guys I've been trying to get on the show for some time, and that is Versan and Vandal, coming over from Black Swan Capital. Guys, welcome to the show.
Good morning. It's a real pleasure to be here. Thank you for having us on your platform.
Yeah, Versan, you guys have been in this space for some time. I want to start off with you, Vandal. What was it that drew you into crypto first thing?
Yeah, sure. So, I was working at Bank of America as a banker, Merrill Lynch. Um, got laid off. Actually, went to go work as an executive assistant to a CFO for an energy and oil and gas company. And, uh, when I was the high, uh, right-hand man for this high-profile individual, I also got laid off. And, um, what happened is during that period, I was actually looking for different types of alternative investments.
And the truth is, I came across, I came across cryptocurrency blockchain technology because a friend was telling me to look into it. He was involved in Bitcoin at the time. I actually never purchased Bitcoin. I never took a serious interest. Um, but, uh, over some time, I started to get a little deeper in the research, really looking at the backend, the infrastructure, blockchain technology, and with my understanding of the banking system, the plumbing, I really thought, okay, um, there's something here. I got to look deeper into it. Um, shared it with my brother. What's interesting is he was already doing research on that kind of stuff at the time.
There you go.
Coincidentally, yes.
Good minds think alike.
Yeah, it's pretty funny. And then we just decided to work together, do the research, go deeper into it, and really see if there's anything here that has not yet been fully identified by the public.
In terms of asymmetric upside and opportunity.
Yeah.
Hey, Vandal, when you, you know, we were talking pre-show and you asked me an interesting question, and that is, what do you think about this market in terms of its validity? You know, and a lot of people, I think, just assume because everybody's been drinking the Kool-Aid, as they call it, for quite some time. And sometimes that can get you, you get you, you get yourself into a bubble. And we, we ask our questions, that question all the time in our, our own research team. Are we too inside the bubble now and not thinking beyond it? Why do you think that, um, top-level Wall Streeters, probably some of the best programming and engineering people I know, are still questioning this technology, even though we're starting to see this massive administration support and now implementation into all of this? Where, why do you think that has happened?
Well, I think there's two reasons. Uh, first of all, some people are just, um, ignorant to the fact that things are changing very rapidly and they can't keep up.
Yeah.
That's one piece to it. The second element is sometimes, not in all cases, but a lot of these venture capital firms, institutions, big players, the truth is, they understand what's going on. Okay? Uh, a lot of times what they do is strategic misdirection. Uh, sometimes they, uh, really create an illusion and paint different narratives to, uh, divert attention from the real value and the real gems. And this is, um, very, uh, this is business as usual on that, on that scale.
So, well, it's misdirection by Wall Street, I think in many cases.
Indeed. Vandal, do you look at the idea of what we've seen? Well, I think BlackRock kind of played their hand early with the, uh, with the Bitcoin ETF.
And also, if you remember, Larry Fink was anti-crypto for quite some time. So was Jamie Dimon. So was Vanguard, who basically bent the knee this week. Um, do you think that's all been orchestrated by Wall Street?
Yes, I do. Um, I've seen this throughout my career. Uh, this is called strategic misdirection, as you mentioned. And, um, they, strategic, you know, there's about four or five companies that control the mainstream media, the news. And if you control the information now, you can shape people's opinions. You can, um, you can confuse them. You can keep them really, uh, running in circles, not understanding what's really going on on a fundamental level. And, um, if you control the narrative now, you control the messaging and you can, uh, continue doing what you do. And essentially, uh, a lot of these big players have been involved at least participating in blockchain technology from an R&D perspective, but also participating in it from a macro cycle perspective. They understand how lucrative this is. Uh, the volatility is undeniable. It's been following the debt-based cycle since 2009. Unquestionably, it follows the liquidity cycle as well, which is the four to five year cycle because the, uh, the debt has to be refinanced, like 75% of all debt in the world. So, it's, um, and since crypto, generally speaking, is at least an 80 to 90% correlation to, uh, liquidity in terms of how it reacts, it's, um, it's an easy game. So, it's very lucrative for these institutions. As a matter of fact, the times when these big institutional players tend to tell people, run for the hills and stay away from it, happens to always be at the lows of the cycle.
Exactly. Yeah. Um, and now they did a 180 on their tone. It's, um, it's strategic misdirection. It's trying to lure people in at the top as exit liquidity so they could sell their large orders. It's, it's a game. But at the same time, I think, uh, the vast majority of cryptocurrencies being allowed to exist in this wild west unregulated market that could have been regulated for the past 16 years if they wanted to. This is, uh, also intentional to keep it messy, sloppy, and, um, profit on the way up as things evolve because that's what they're doing. We're seeing money go in the system, money go out, and every single time these hedge funds, big institutions, what they're doing is they're trading the volatility for cash. Um, now they probably still have a long-term core position in select assets because they understand that, um, this blockchain technology is revolutionizing the finance, financial landscape, but they still, they're playing the game. That's what they're in the business for.
Yeah, for sure. Hey, Versan, when, okay, so I, I noticed you on another podcast, you mentioned this idea of XRP being already adopted, I think was the term you used. And if you look at JP Morgan, BlackRock, the BIS, IMF, the amount of international settlement, the moves now with SWIFT, and what appears to be Linea could be playing into this. How do you think, is there, and I guess this is kind of a, I, I won't call it a conspiracy theory, but do you believe that there is a, a shadow engagement happening around XRP right now already?
Absolutely. I think the whole narrative around XRP at this point is one of the largest financial coverups in history. And, uh, to my brother, that's going to be the headline today.
It is. Yes.
Um, and I've written extensively about this. I've talked about it for many years, like many other people in this ecosystem. But to my brother's point, you know, in a world where perceptions are shaped by headlines and sensational narratives, I think asking the right questions has never been more critical. And my question at the end of the day comes to, what truly defines a store of value in today's volatile and very corrupt economic landscape? Right?
And I think as the traditional systems are changing, individuals and institutions must adopt. We don't really have a choice, right?
And to understand the potential of what's happening in the world, you kind of have to look at the dollar and the decline of currency cycles. And it all ties into some of the things my brother explained over there. But market structures, they don't really change. It's only the perception around them that does.
Yeah. And I, I look at institutional accumulation patterns. You know, many of these have always involved these ideas around quiet stacking. Uh, corporate treasury adoption. We're already starting to see, obviously, MicroStrategy. Now, could be in the next few years, if not the most valuable company on the planet. He will definitely be one of the most, uh, rich people on the planet. And I know, uh, Elon just hit almost half a trillion the other day, but the point being, is that we're seeing, you know, some pretty, um, a big adoption concepts that are playing out. And and it's very early right now. The Vivo Power, you know, news this week, very small amount. I mean, sure, I think it was close to 20 million, but still, there's still very small amount in terms of, um, putting assets like XRP on treasuries. Do you think this is going to gain real, you know, system-wide adoption from a, not from an institutional side, but more from a business side, companies that are going to start putting this on their treasury?
Absolutely. I mean, right now, what we see happening is bringing regulated capital into this ecosystem.
Yeah.
Mhm. And that's, that's very big, you know.
Well, regulated capital is going to be the, I think, the catalyst that will kind of really bring this market to, you know, fruition in terms of how this plays out. Here's, and I guess, uh, Vandal, when you look at the component of being able to tie in retail and then institutional, do you think it's going to be too late for retail in this next phase, and retail had its chance prior to this? What are your thoughts?
Yeah, I'm going to be very blunt, blunt here. Um, I'm seeing currently today a lot of parallels to previous cycles, but at the same time, I have to admit, there are clearly some significant differences that are noticeable. So, a lot of people say this time it's different. Well, not everything is different. Some things are different. Um, so to answer your question, I do believe that based on the patterns I'm seeing from the capital rotating throughout the crypto ecosystem, it's mirroring a similar pattern that we saw during the dot-com bubble.
Yeah.
So, what's interesting about that point I'm trying to make is that when you see that kind of capital rotation within the crypto ecosystem and the way things are playing out, essentially, it's, it's signaling that this bubble, not all assets are in a bubble, but this ecosystem is about to become even more euphoric, and eventually, the big, uh, entities, the news companies are going to collude together and run marketing campaigns to lure in retail, and then double, uh, new, at new all-time highs, and essentially, yes, and this is going to play out like the dot-com bubble. And once they wipe out the space, you'll really see who the real winners are that will emerge. Um, but I think that's coming. So, I do think retail will have a chance to participate back then, but the truth is, most of them won't because that's what happens in a, uh, market. They'll miss the window because they're listening to the wrong podcast. They're watching mainstream news. So, they're following down the, you know, the unfortunate orange pill rabbit hole that they will go into and and basically get torched on the backside. That was about 8 trillion that came off the dot-com bomb market. When you look at the implosion that happened on Wall Street during that era, I was working in Silicon Valley at that time, and working for one of the biggest out there. Fortunately, we were insulated at Microsoft, but I had a chance. I knew hundreds of engineers, thousands that I had either interviewed for jobs at Microsoft, etc., that came in off the streets after all those companies failed, you know, because of the, basically the, the dry up of the capital and of course, all these publicly, you know, IPO companies that were just nothing but blue sky. They didn't have anything in most cases.
Uh, just a dream. And in in the crypto world, we call it a white paper, you know. So, if you got a white paper, you, you know, you got a token, uh, kind of thing. So, uh, that, I agree with you. I think that you're dead on in that.
I mean, may I add a piece of insight here? That's all right. Well, to to his point, you know, it all starts with accumulation, and we've been seeing that for a while. Assets are dismissed or ignored. Confidence then grows. Prices climb. Expansion takes hold. That, that's kind of where we are. That's where the euphoria starts to inflate valuations, and then you have a blow-off top, and that's when fear eventually crashes everything into a correction.
Y.
And then you start to ask the bigger questions here. Well, what is this technology actually doing?
You know what I mean? And I think it really ties it boils down to what's happening in the traditional monetary system, going back to the US dollar. And the dollar liquidity is plunging. That means no matter how much money they're going to keep printing, they don't even have enough money to finance governments itself. So no matter how much they print, debt is out of control. There are other systemic issues tied to this. And I think the most critical aspect here is dollar liquidity and then the end of currency cycles. And that's kind of where we are today. Right.
Well, and and we'll get into the DXY in a minute, the correlation between the dollar valuation, debasement of the US dollar, if this cycle is going to be different here in a second. But I want to continue on this, uh, topic for a second and because I think it's very important for our listeners and viewers to understand this, guys, is that mainstream media right now has a narrative. We're one of the few independent media organizations. There are no investors in our business. I've kept it that way for a reason. There's nobody telling us what to report on, even though they try to DM us and tell us that we should be covering this token or that token and call us shills, even though we don't get paid by anybody. All those kind of things, which usually tells me very quickly that we're doing something right, uh, when when that starts to happen. But I think the, the fact that podcasting and that the evolution of YouTube, financial and tech media has kind of converged. Now, the power players are no longer MSNBC, CNN, you know, Bloomberg, where they're running the show, just in the terms of of volume. Do you think retail has a shot to actually learn what is being done and maybe outmaneuver how Wall Street is playing this out, or do you think they're just too good at it?
Oh my god. Um, that's a rabbit hole. Um, Vandal, would you like first?
Yeah. Uh, not to be a pessimist or too cynical, but I think, um, I think most people, um, are, uh, not going to get it. Um, I think you have to be a critical thinker.
Yeah.
You have to have an open mind, and you have to be aware of the misinformation and the psychopaths that, uh, control the media. Okay? Because the truth is, um, their weapon today is not, you know, firearms. It's, um, it's information. Okay? And if they can manipulate it, they can manipulate your opinions, the way you see things, the way you understand and interpret information. And at the end of the day, we all have access to the same information. The key is being intelligent. And that doesn't mean being smart as in, oh, I know everything. I know it all.
Right?
It means basically being able to look at things and look at the world differently and interpret the information and exercise good judgment because again, we all have access to the same info. The key is how do you interpret it?
Yeah.
And and that comes down to instinct and judgment. So, um, I think there are people out there that, um, will be able to see beyond the noise, um, if they're really searching for the truth and for the right information. But you can't, um, I mean, if it comes to you, that's pure luck. Um, that always plays a role, but you have to, uh, admittedly and acknowledge that, um, that there is a lot of manipulation and misinformation out there. Um, but channels like yours, what you've built is absolutely extraordinary. Um, it's remarkable. You're putting excellent information in front of people, objectively unbiased perspectives, and you're allowing people to get different sense of different perspectives and see through different lenses, and that can help people really, uh, form better judgment being able to get more information.
Well, I think the key is that you've got to do research. But here's the thing we tell our own team members is research the research because a lot of times the research itself, in some cases, especially now with AI, is a little bit jaded or and/or inaccurate. So go always go check the sources, then check the sources' source. And because there are manipulation layers that we see happening right now dramatically. This was, we talked about this before the show started. We built an algorithm which now has, uh, an AI component to it that's trying to measure the bot traffic. Which I have never seen so much bot traffic in social that is centered around one particular industry, and that is crypto. Uh, so it's clearly being manipulated, uh, in ways that I, I don't, I don't understand yet if it's being done, um, systematically or if this is being correlated from greater power. I, I don't understand, or if it's just a whole slew of Asian and international Russian bots and, you know, the Middle East, etc., that are, are trying to flood the system. We're trying to figure this out because right now, when you look at the top 150 tokens, which is the ones we kind of correlate to the ones that we track, um, there's only a handful that really have real community behind them. XRP is one of them, even though XRP has a lot of bot traffic.
Mhm.
You know, equal enough to Solana, equal enough to Avalanche, Bitcoin, which is a different animal in itself. So, I think this whole issue you guys are hitting on is very important. Is this going to be a tightrope walk for for retail investors? Do, when, when do you think, Versan, when do you think, um, this could end in terms of this cycle, especially when you look at liquidity, you know, and all that? Exa, ex, give me an example.
Well, governments all over the world and institutions, they're still tied to the reserve currency. I think there's going to be a time and place where the debt market implodes, and that will lead to a massive credit event, and then they're going to need a substitute, and not necessarily just for liquidity purposes, but also for a medium of exchange and a for value in the digital, um, uh, digital, uh, ecosystem, you could say. And I think if you follow closely what the 1% institutions are doing, it's very simple. Like we can even talk about SWIFT, for instance.
Y.
Um, you know, uh, there's a lot of headlines coming out about SWIFT now, but the original, this is the original backbone of the traditional banking, uh, inter system. But you could go back as far as 2016, 2017, uh, you had Marcus Treacher from, uh, HSBC, a member of SWIFT's global board, he joined Ripple 2016, '17. Margie De Latine from SWIFT, uh, business, she's also been working with Ripple and integration of, uh, SWIFT. So, I think a lot of this has been, you know, already put in motion a long time ago, and it's a soft disclosure, like breadcrumbs, kind of thing. And it aligns with the geopolitical tensions that we see happening around the world and the BRICS. So, it's getting to a point, but I think this cycle is, uh, a frenzy cycle. We're going to see it play out naturally as it would, and then there will be that correction moment where things start to break out. It will be most likely a credit event, leading to an implosion of the debt market, or we could just see the evolution of all of this and not necessarily have a crisis.
Well, okay. So here's a, a theory we've been working on is is when you look at SWIFT and where the overall financial, especially around cross-border payments are going. You look at this move with Linea, which seems very late in the game to make that call now. Um, so it made me question, why, why would you make that call to go into a prototype with Linea? Um, at this moment when we have all this adoption cycle happening in the US, you have credit event, and you're in the middle of what could be one of the biggest bull runs ever. Okay? Because if I'm looking at as any business, I would say, we've already missed it. You know, there's no way for us to catch it.
So is SWIFT secretly already made a decision?
I would say so. But if I could also be a little more blunt about this, the truth is, if you look at the technology itself, it's true blockchain and cryptocurrency can eliminate all the legacy institutions. And that's problematic because this technology was supposed to help us break free from the banking system, whatever you want to call it, right? Um, the deep state. Um, but here we are cheering them on for the adoption of the payment corridors, the on and off ramps, and that kind of raises concerns. But I would say that for sure, that they are building this system a long time ago. It's, um, all tied to self-disclosure of how the ecosystem and the cycle plays out.
Yeah.
If you zoom out and look at this, but I do believe it's all been decided, and what we're seeing is self-disclosure because, um, I see a lot of the same topics that were discussed in the early days. I have the documents upstairs, uh, from 2015, '16, '17, '18, '19, and we're seeing them resurface again. We have the direction of the monetary system right now and the challenges that we do have.
All right. So let's, let's jump over to the correlation and debasement of the dollar because this is going to be an integral point that I think a lot of people need to understand. And you remember 2024, the DXY decline coincided with almost like a 600% XRP rally. It went up to like 340. So the correlation is there where the dollar valuation, XRP starts to move. We haven't seen the complete model set up again, even though we are seeing the DXY now trend lower, uh, right now. Do you think, uh, Versan, that we could see maybe a next major rally being driven by the debasement of the dollar only, or do you think it's going to be more toward a Wall Street injection into the capital markets for crypto?
I think it's going to be Wall Street injection, honestly.
Yeah.
I mean, they're going to pump this thing to the moon, as people call it. And again, it's bringing a lot of regulated capital into this so they can go ahead and, I would say, solidify a consolidation of wealth. And I think tokenization is the next step of that.
Yeah.
Mhm. I think the, the component that everybody's missing here is, you know, back, you know, to our earlier conversation, is the manipulation plays that are being, uh, really deployed into the market right now are very similar to what they've done in the past with stocks, and with the bond market. Uh, it's not something that's new. And in, in reality, even the tech industry was, uh, kind of fell prey to this in in the dot-com era. And, and really, if you look at it, real estate in 2008, you know, when you go back and look at the implosion of, uh, the markets around 2007 and '08 on the economic, uh, restructure that occurred that time, at that time. And I think that's when we saw the the death of the dollar has just been a slow bleed, you know, to where it is now.
What is your theory around, uh, XRP overtaking Bitcoin as a market leader? What do you think, uh, Vandal, would you like to go on this, or you're asking me?
Go ahead. Either one of you can hit it.
Yeah. So, um, I do believe that at some point, uh, well, first of all, it's important to understand that, uh, and this ties into the DXY as well, that, uh, all cryptocurrencies are driven by liquidity. That's the primary driver of financial assets and financial markets. Now, crypto, Bitcoin, even XRP, happens to be the most sensitive risk-on asset to liquidity. So, a very high correlation. So when these technologies really start to receive stable liquidity inflows on their network, essentially, they're going to derive their value from use case and adoption, and that will stabilize some of these prices. So the question is, if Bitcoin was a store of value, then why did it dump around April?
Yeah.
During the, when Trump announced Liberation Day and the bond market took a hit and yields spiked, crypto dumped. When, if it was a store of value, it should have actually stabilized or even risen in price. That, that alone tells me that this, um, this is not store of value. So, and actually gold actually rose that time. So, what's interesting here is if we're talking about store of value, 16 years is not enough history to determine whether something is a store of value or not. I mean, Bernie Madoff ran his Ponzi for almost 20 years. So, I'm not saying that's the case here, but I still think it's too early to determine whether Bitcoin will even be a store of value in the next 30, 40, 50 years because 16 years is too early. We don't even have regulations, and I don't think any country in the world is going to make an asset a store of value while still playing the game of, we don't know who created it. Um, the truth is, they were behind it. Intelligence agencies, some of these venture capital firms funding it with the central banks, all the, the, um, breadcrumbs and the trails are there that support that thesis, that theory, excuse me. So, I believe at the end of the day, some of these technologies will begin to stabilize over time and not behave like a risk-on asset, as they are today, and that will come from real network adoption and utility over time. It doesn't happen overnight. It's a gradual process. Now, I believe when that time comes, if Bitcoin doesn't have any real-world utility in terms of what it was supposedly designed to do, every narrative has fallen apart. Store of value, that's not store of value because it wouldn't decline during a crisis like we had in April with the announcement of Liberation Day. It would have remained stable or went up. That's not store of value. And there's plenty of countless historical points as well where it drops 60 to 80%. Um, I see it as more a wealth creation vehicle for the elite because put some big money in it, it goes up 10, 20%. You make a killing.
Know how to exit and your, yeah, your balance sheet.
Yes. And the cycle, the cycle repeats.
Yes. But eventually, once utility really starts to manifest and take effect on a global stage, real adoption, real use case, less volatility in some of these assets because their network adoption will be overpowering the risk-on behavior due to liquidity. At that point, which could be many years in the future, but we're heading that direction. At that point, if Bitcoin doesn't have any real use case to bring to the table, it's just, um, by definition, that's a Ponzi. It's a, it's playing musical chairs. Who gets in early? And the, the, the ultimate goal is to sell it to the next person who's willing to pay more for it and just repeat that cycle. Yeah. And many people would, would, you know, if you're on the Bitcoiner side of this, they would be pointing at at XRP and Ripple in the same way, saying, "Well, wait a minute. You know, Ripple's still holding all the tokens. Granted, you know, Ripple is the Satoshi of of XRP, only out in the open." You also have the issue, uh, where Schwartz has now stepped down. Everybody's worried about why is that happening at this time? You know, this is the CTO, the architect of of the XRP ledger. What is going on in that framework? And then they put a guy in charge of it who's really only been there since October of last year. So, there's still a lot of problems, you know, here that are brewing. And this is, in my opinion, not a good time to be doing musical chairs on your team members.
Yeah.
Right now, as this market goes, how would you, uh, Vandal, how would you counter that?
Yeah. So, to be honest, I don't place any significant weight or value on what these CEOs are doing, executives, and especially news articles and narratives.
Yeah.
I just look at the data. As long as the fundamentals remain unshaken, unchanged, I'm looking at the long-term trajectory. I'm really here for the big moves. Um, yeah, I'm not paying attention to that. I really don't care what they do, what they don't do. Fundamentals haven't changed. Nothing's changed.
Well, Versan, let me ask you this question. If Brad Garlinghouse stepped away from Ripple right now and said, "Hey, thank you guys. It's been a good ride."
Do you think people would look at that and say, "I'm, I'm selling my XRP."
Or do you think?
Absolutely. Absolutely. I think like my brother said, you know, they're, they're listen, a lot of people understand XRP to a degree, but I don't think they're factoring in some of the macro, uh, picture behind of this, right? Like, why is it being adopted? What's its use case? Why central banks have been long involved in this. Um, so yes, we, we don't really pay attention to headlines. We really don't. But we look at the data, we look at the fundamentals, and if the fundamentals haven't changed, we stick with the the trajectory.
Well, let's move into, uh, RLUSD, and because stablecoin really is going to be, I think, the, the cheat code of how, if anything, how crypto is truly going to be used in the future. Uh, obviously, RLUSD now top 100, continues to climb in in terms of total, uh, value locked. And you look at that in comparison to what's happening with, uh, Tether, which has somewhat of an Achilles' heel because of the MiCA compliance issue, they were not be able to maintain it, they weren't being able to come to compliancy here in the United States. So, what do they do? They create USDT or US, uh, UST, right?
Yeah, USAT.
Um, when you think about that, is this RLUSD's option to maybe truly become the global institutional stablecoin?
I would say so. I think as the demand for stablecoins grows, uh, driven by tokenized elements, cross-border transfers, and tokenization of real-world assets and so forth, the need for XRP, and especially on-demand liquidity, the ODL, which is, I think, the backbone of liquidity, it's going to only increase. And this is going to be driven simply by basic economics, supply, demand, and scarcity at work. Um, when we look at Tether, what they're doing now with USAT, if that's what it's called, right?
Yeah, USAT.
Okay, that's a legal loophole around the compliance. Okay? So they're simply buying time.
And I think it goes a little bit even deeper and ties into the Bitcoin because Bitcoin has actually been artificially inflated by Tether's synthetic liquidity.
Yeah.
Um, Tether is nothing but a shadow bank, and, you know, there people have died because they tried to get too close to exposing that. So, um, I think that eventually it's going to face a reckoning, and, uh, at the end of the day, I think it belongs to compliance. Um, ultimately, all the value that's coming into the ecosystem, whether it be Bitcoin, Solana, Cardano, in some way, form, or fashion, it's going to touch the XRP ledger for settlement and liquidity. So your shift, uh, thesis is USDT starts to convert into RLUSD, or because, I mean, if you look at USDC, this is Circle, they're beholden to Coinbase in terms of their fees. I think it's half the fees right now. So, it's not really a valuable. I look at it eventually that's going to be replaced by something, and I can only imagine that's, it's either got to be, um, RLUSD, possibly one of the other tokens that are correlating around PayPal, Robinhood, and some of these white-label models. What, what do you guys think about that as an alternative to Tether to compete against RLUSD in five years?
Yeah. So, uh, first of all, I really don't think there's, um, uh, too much competition as, as it seems on the surface. Um, I think these have been, these, um, uh, stablecoins, and the true winners that will be used in the system have been planned out for a very long time.
Mhm.
So, um, just for context, we, we shared a document that we discovered in 2022 from the World Bank Group, and I'm sure you've seen this go around. It's, uh, the stablecoin section in the document, and it was page 31. And under the label stablecoins, they specifically mention and in detail,
Mhm.
Discussing XRP and XLM. But what's interesting is the title was labeled stablecoins. This was in 2022. Now, this was from the World Bank Group. What's interesting is to understand the powers at play here in the global powers, and ultimately how they operate, you got to understand the plumbing of the banking system and how it really works all together because it's all intertwined. And essentially, the World Bank Group and the IMF were pretty much created by the BIS, which is the Bank for International Settlements. Now, the Bank for International Settlements is essentially the central bank of the central banks, and they operate as a, uh, they have sovereign immunity. It's like a shadow superpower company. So, if you really understand the banking system and the powers that be here, essentially they are behind everything we are seeing, and it all leads down to the stablecoins because what they're trying to do here is, uh, build a centralized grid, uh, infrastructure that's on the blockchain technology, and some of these stablecoins have been chosen long ago, and perhaps even some that we haven't, uh, heard of yet. It's possible. So, there are some areas that I'm still speculating about. We don't have all the information, and we have to admit that. Uh, but it, I mean, when you look at Tether, it's been around for what, a decade or something like that, and they've allowed it to artificially inflate different assets, and especially Bitcoin as well. Um, we've followed the money. Some topics we can't even discuss here. It's been used for various nefarious activities. Okay. And, um, it's been kind of operating in the shadows for a very long period. And all of a sudden now, when we have all this geopolitical and economic risk within the bond market, globally, with the US dollar, now they decide that, hey, let's crack down on compliance and let's, uh, kind of shift the narrative.
So my, well, I mean, you, they take, they obviously get Boing. So this comes right out of the Trump administration.
Um, that was, to me, the first tell in the in the strategy that, okay, this is a political play into the US. I'm not even sure if Powell is serious about this just yet. Maybe he is, because when they did the, uh, the meeting with the CFTC just the other day, it was Powell there, not Bo, that was there with Brad. Uh, they were on opposite ends. Did you guys notice that in the photo?
Uh, I actually did not notice it, but, you know, I, I've been paying very close attention to what they've been doing for a very long time. And I think the whole stablecoin narrative is a double-edged sword. If you start to look a little bit closer at it, you see central banks and financial institutions that, again, going back to dollar liquidity, they relied on these cycles of artificial liquidity and debt restructuring and so forth into the global markets. And that's all changing now. Stablecoins to kind of change the dynamic. They're being used as a, a new source of liquidity to help them extend these cycles. And even, uh, I would say, I, I mean, you saw what it, uh, the other day. I mean, they absolutely just called us out and said, "Hey, the US is going to go this stablecoin route to refinance their debt and unload their dollars on the rest of the world."
That's exactly what I wrote about, said two months ago.
Yeah. But this is how what these people call the deep state gets their hands into the new payment systems that were originally designed to cut them off. So, it is a double-edged sword, and I think, let me ask you guys this, because this is one that, this is a thesis one of our engineers and one of our research team has been working on, and he presented it to me about a year and a half ago, and he said, "Listen, we are now, um, entering this phase of the government trying to put up this facade that they don't want CBDC."
Yes.
So, you have the anti-CBDC governance that obviously went into the Genus Act. And we were on this about a year and a half ago, and our team said, "Paul, look at this." We, we spent about a month and a half on on the research, a little deeper, and we jumped into Palantir, and Palantir's component of analyzing blockchain, any data set, would essentially give them the capacity to have a CBDC, uh, lens on any stablecoin, knowing exactly where that wallet came from, tracing multiple wallet deeps, uh, being able to transact that into any source, uh, solution, such as a, you know, an online bank, putting that into the security system, tracking any kind of, uh, payments in from security sales, all that kind of situation. So, in reality, with the exception of a kill switch, which I'm not sure there isn't one, with the exception of a kill switch, that's a CBDC.
It is. Yes, it is a CBDC. I've also written extensively about how stablecoins are the new CBDCs. It's just the connotation didn't do so well because a lot of, you know, podcasts like ours, like yours, uh, we tried to expose this stuff in 2020.
Um, my YouTube channel got shut down, the first one I had. Um, and we, we revealed all of this stuff. And what's more disturbing is how openly they discussed this. You know, they discussed this publicly, natural selection, social inclusion, social exclusion, debanking entire groups of people, stripping them, uh, out of food, shelter, healthcare, anything.
So, well, yeah, and you have the debanking model that's coming into play. I just saw the Swell, um, line list, and if you remember, Bank of America was one of the ones that debanked Garlinghouse, and they're on stage.
Yeah.
As well.
Yeah. It's, it's really, you know, the stakes could not be higher. And, you know, digital IDs, I would say, is the next part that's coming. It's coming, right? And it was the WEF and the BIS who said that nobody would be able to participate without a digital ID.
Let's, let's go the direction of, um, a counterargument on if Bitcoin were to have a black swan event. Let's just say, let's just say it, Sailor sells, or Sailor doesn't, I, um, either way, either way. Yeah. What happens? Would that take down the entire market? Crypto, I don't think it would would touch the S&P. Maybe to a certain extent. Obviously, the dot-com companies would get, would get hit, but what are you guys' thoughts?
Well, the all the financial markets are primarily driven by liquidity. So, if Bitcoin did take a serious drawdown,
Yeah.
Um, I actually think one of the catalysts will be these treasury companies, and we'll see a dot-com bubble implosion. And I think one of these big players are going to be thrown under the bus. Um, overinvestment, overfunding, raising billions of dollars in capital in this type of environment. Um, you know, too many pump and dumps, too many entities that aren't worth being here in the next five, ten years. Um, that you're going to see a bubble, you're going to see a pop. Sure, it's inevitable. Um, retail is going to flood in, push these prices to irrational levels. Smart money is going to exit before it happens. Um, but I do see, um, a significant drawdown in Bitcoin. Um, now, I, I don't like to use the term implode because, uh, we can't really determine how steep that drawdown would be. It really depends if we look throughout history, the drawdowns tend to be a little less, um, steep, each cycle.
Yeah.
And that's a fact, you know. So, could that change? Of course, it depends on the, the environment. It depends on the, how much liquidity is being shifted out of cryptocurrencies and Bitcoin, particularly. But I think there will be a point where there's a force massive liquidation that occurs. And I think one of these entities are going to be way out of line, overleveraged. Yeah. And it will create this ripple effect that will, um, be amplified with, of course, negative media narratives to, you know, add fuel to the fire. But essentially, it will drag the whole market down. Um, I'm not, I'm not looking at it from a conspiratorial fashion, saying that, oh, all that capital will flow into XRP. It's possible. But, look, as sophisticated investors, we always have to take into account the unknown element, the unknown factor. We don't have a crystal ball. So, we know the direction things are moving in. We just can't pinpoint a time or dates when all that capital will flow and distribute into assets that real have real utility. I think that would be inevitable at some point over time. Um, you're going to see a lot of liquidity leave some of these overinflated assets and distribute into assets that are worth being here in the next 10, 20, 30 years from a utility adoption perspective.
Yeah, there's going to be some winners for sure.
I mean, it's widely held, but it's poorly understood.
Yeah. Bitcoin and, uh, there is a harsh reality to his point of exit liquidity for the debt markets. You know, it was even Trump who floated the idea out that we could use this to pay off our national debt.
Yeah.
So, it's, it's entirely possible that Bitcoin holders, especially the early ones,
Maybe exit liquidity for the government.
Yeah.
Yes. Exactly. Right. And, uh, using it to absorb toxic assets in exchange for the illusion of wealth.
Build up the model, uh, through regulation. Build it up through media narratives. Build it up through point men, which become all of the, you know, that you need 10 Sailors out there, you know, which is, I mean, if you really think about it, is Larry, Sailor, Jamie, now Vanguard, all of which will be jumping into this and and driving it into the next layer. But I haven't seen this would be a cataclysmic event if that were to occur because if you look back at the history of the S&P, outside of 1929, we had not have not really seen that kind of event occur. And what you're talking about, to your name, is a true black swan.
Yes.
Well, the thing is, these cataclysmic events, um, you know, a lot of historians like to portray them as miscalculations, accidents. The truth is, it's all engineered and baked into the pie. They serve as massive opportunities to consolidate power, consolidate wealth. We saw this throughout the banking crisis previously. I mean, in the 1930s, you had over 9,000 banks that went, gone poof. Um, this is just a playbook. So, they are going to do it again. It serves them more than it serves the people because they can accumulate assets at very steep discounts, consolidate power, consolidate wealth, eliminate the weak hands, eliminate the bad players, push wealth higher up the food chain. And essentially, I don't see this cycle ending anytime soon. And the reason I knew it was not going to end, and I don't think it will. Maybe it's extending slightly because of macro factors, but I don't think it's going to end.
Because, um, crypto and Bitcoin is a macro asset. And,
Okay, when you say you don't think it's going to end, okay, you have to explain what you're saying there.
I'll elaborate. Is it this cycle, meaning next year, 2026, or you think this is a super cycle like Tom Lee says, over the next decade?
Yes. There's a lot of people saying that, uh, cycles are over and we're just going up. Okay. Uh, this is a complete false narrative and a misconception because crypto is a macro asset.
Mhm.
It follows, it follows the debt cycles, and the debt cycles coincide with the dollar cycle and the liquidity cycle.
Everything is cyclical. It's.
not linear. So as long as we have debt cycles, crypto, majority of it will operate in a cyclical fashion. Um, because it's driven by the debt cycles and the liquidity that happen to all coincide together.
Now, how do I know or how do why do I believe that the debt cycles are not ending? And that's because they just introduced the Genius Act.
"Yeah."
The whole point of the Genius Act is to kick the can down the road.
"Yeah."
If you actually read the bill, it explicitly says, "stable coin issuers issuing a stable coin will have to buy an equivalent ratio of US government debt and treasuries."
"Yeah."
Well, it doesn't even say treasuries. It says high-quality reserve assets.
"Yeah."
In practice, a high-quality reserve asset is US debt and treasury. Now, the whole point of the Federal Reserve here, the lender of last resort and the excuse me, the Treasury, they're bond salesmen.
"Their whole goal is to preserve the integrity of the bond market."
"Yeah."
And in order to do that, they need demand. So what they did is they created a situation with the Genius Act, a bill, a law that essentially puts stable coin issuers in a position where by default they have to purchase US debt. And the thing here is they will purchase it because stable coin growth is increasing.
"Yep."
And we know it's just it's just beginning too, guys.
"It's just beginning."
Exactly. We are at the very micron of all right. So this kind of go in line with, you know, this whole concept. This is one of the strategies we've employed for quite some time is and we believe uh tokenized gold is going to be a big factor here going forward because of the fact that we'll see BIS reclassifying gold as tier one. We already know that happened. You look at the integration into these central banks where gold is going. And also look at the World Bank, IMF, and the World Gold Council discussions that have been talked about around this. And if you guys go out and research, you're watching this right now, go out on YouTube, look at the World Gold Council discussions on YouTube that have had the idea of a gold-backed stable coin concept.
"Right?"
"What would you say to that, Versant? Do you think there's something there?"
"Of course there is. Absolutely. I've been I've been uh I favored that for a very long time because my my number one position as I ask my question myself the question, what is a true store of value? Number one, I stay I stick with gold. I'm a very big precious metals individual. So I don't think digital currencies are really the endgame. I think it could be also a bridge to a far more transformative financial future. And I'm talking about introducing gold back into the system and have gold globally circulating as a currency. So it's not hypothetical."
"Which is tokenized, which you need a settlement layer."
"Exactly. Now, that's where I was going to. Right. So, the 2021 World Gold Council report, I actually have the video on my my channel on the shorts. It's out there. And he talked about ultimately finding a stable coin that is gold-backed that would eventually replace the US dollar, a stable coin that's gold-backed. Then you kind of bridge in the World Bank calling XRP a stable coin. And if you look at its functionality with XRP acting as a settlement, a universal settlement language model. Um, this makes perfect sense, right? It seems like the system um could actually bring gold back into the system. Unlike other digital assets, XRP, it's designed for the high-speed, low-cost settlements that we're talking about. And that makes it the ideal vehicle, you could say, for tokenized gold to move freely across borders, right? And I think finally um sorry but as central banks and financial institutions start increasingly adopt stable coins for liquidity management and as well as XRP, we can tie that into the whole central bank narrative functioning as a backbone for seamless settlement. You start to bridge these things all together and like you said, you have to cross-reference the research, right?"
"Yeah."
So, you know, being set, what we are uh in right now is unlike we talked about earlier, you know, we're in the front row seat of a revolution that is uh reformatting the financial system. All of this is back to your point, Versant and and Vandel, is that this is going to most likely be driven off of a credit event that will occur. Um, we're going to see this integration of global digital assets and digital ID start to take place in the next possibly, would you say five years is too long or do you think this could happen faster?"
"I think by even next year uh we could see some things take place like this."
"The credit event or are you talking about digital?"
"In terms of digital ID tied to digital assets, whether we see tokenized gold or Bitcoin or or other digital assets playing into this as an ecosystem?"
"Well, I mean, if you look at the UK and other nations, they're already beginning to roll this out. And historically, uh, when governments begin to lose the narrative or lose control, they start to show their hands of authoritarianism. And we're starting to see this. So, if they're losing control because of the narrative, then they're going to try hard to acquire platforms like TikTok. We see things like this and information control and identity. And without going into too much detail, um, you know, I mean again, the stakes are very high, right? And, um, it's an extraordinary thing because, you know, XRP kind of gives you some maybe purview outside of central bank, you know, control. I'm not really sure. But again, you have to ask the question about the on and off ramps, right? Um, the payment corridors, the liquidity corridors. So, does it really give you the option to step outside of central bank purview and the ability to exit and enter their systems under their own terms? I don't know. So, it raises so many questions and, um, I'm not sure how this is going to play out."
"Well, listen, guys. All right. I I what I can tell you right now is this podcast will normally go four hours. I would tell you right now, we could go four hours easy. Uh, but that's not going to be the case today. I'm gonna have both of you guys back because I have a whole second section of this podcast that we should get out there. And of course, we'll get into some of that that we're talking in reference to maybe where this could be going around digital ID, the idea of maybe the central banks being much more involved than what everybody thinks. So, "
"Yes,"
"Uh, Versant, Vandel, it's been great having you on the show today. Thanks so much for coming in."
"It's a real pleasure. Thank you kindly."
"Thank you, Paul. Been a pleasure."
All right, you guys. If you're not uh subscribed, do it now. We just cracked 200 on this channel alone. We're at 1.9 million subs over on PBN. So now we are the largest crypto and tech-oriented show out there. All because of you. Thank you so much for stopping in on the XRP Pod. We'll catch you later. Heat. Heat. N.
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