The Largest Securities Exchange in the World is Coming Onchain | Michael Blaugrund of NYSE and Carlos Domingo of Securitize

Carlos:
[0:00] The tokenized treasury space that the Biddle plays, which is still the largest

Carlos:
[0:04] asset, I think it's worth 2.3 billion or something now, it was like 300 million two years ago.

Carlos:
[0:09] And now it's 11 billion. I don't think there's any part of crypto that has grown that fast. So it kind of feels that way for tokenization that we're at the end of the beginning. Now the beginning has happened. Now we need to get into the real growth because the space is so massive, as we discussed before, just taking, you know, 1% or 2% of the stocks on chain doubles the size of crypto. So that the fact that we have tens of billions of dollars still feels like very, very early days.

David:
[0:39] Bankless Nation, I'm here with Carlos Domingo from Securitize and Michael Blagrand from the New York Stock Exchange. Carlos, welcome back to Bankless and Michael, welcome to Bankless for the first time.

Michael:
[0:50] Great to be here. Thanks for having me.

David:
[0:51] There was an announcement out of both of your guys' neck of the woods from the Securitize New York Stock Exchange neck of the woods last week about a partnership between your guys' two companies about getting tokens, securities, tokenized on public blockchains. Now, I want to drill down into the details of that announcement because I just want to learn a little bit more about what this partnership means, how it works, and like some of the net products are at the end of it. And so we're going to go line by line. I just want to start reading off some of the first lines in this announcement just because I want to get down to the actual nuances of it all. The first line is Securitize is named as the first digital transfer agent for the New York Stock Exchange. What is a digital transfer agent? What role does that do in the whole world of securities and trading them and all that kind of stuff?

Carlos:
[1:49] I guess I can take that one since it's about Securitize. So every publicly traded company or every ETF, anything that trades on a national exchange has a transfer agent, which is responsible. For keeping the books and records of who holds the securities, which in publicly traded companies, most of the only thing you see is DTCC because all the shares are under DTCC. Most people don't realize that when you are, when you hold shares on Robinhood, you actually don't own the shares. The shares are under the central securities depository. But in any case, you need a transfer agent. So if you wanted to issue tokens outside of, you know, current market structure on a blockchain that represents the same instrument, the same equity, the same QC, the same rights, supporting rights, splits, dividends, etc., The natural, let's say, entity to do that is the transfer agent. Securitas is a transfer agent since 2019. We refer to us as digital in the sense that we use for our ledger technology, our public blockchains, as opposed to, let's say, more traditional database technology that other transfer agents use. And all our procedures are all digital, right? We don't do anything with shared certificates or paper certificates or other type of non-digital activities. So we have been accepted by the New York Stock Exchange for the new venue, which I guess is the next thing that we need to explain what it is, to be able to then work with public retail companies, issue tokens that represents, you know, native representation of equity. And then, you know, those tokens will trade on the New York Stock Exchange digital venue. So as I understand it,

David:
[3:17] What you just said is the digital is more of just a word that you guys added. There's no such thing as like a digital transfer agent.

Carlos:
[3:24] No, transfer agents are transfer agents. The industry in general refers to blockchain-based transfer agents or digital transfer agents.

David:
[3:29] Okay.

Ryan:
[3:30] And Carlos, just so we understand, because we don't have this concept with our crypto native assets, of course, right? There's no transfer agent. So what data does the transfer agent have? Is that sort of like a ownership cap table of who owns what?

Carlos:
[3:42] Well, basically, we are the transfer agent for Bidolet, BlackRock, and for other products. So it's basically the regulated, it's an SEC registered entity, and that basically manages the securities on behalf of an issuer. So you basically issue securities, you control transfers to update the cap table, you pay dividends, you conduct votes if you need to, you do sort of asset servicing if there's any type of, I don't know, somebody needs to move their shares or somebody lost access to their shares. In the case of a blockchain, somebody loses access to their private keys and you need to burn and reissue. Like all that work is what a transfer agent does.

Ryan:
[4:19] Okay, and every security has to have a transfer agent. It's in the regulations. And I guess moving this to kind of crypto. Not every security, okay.

Carlos:
[4:27] Some securities is mandatory. Okay. Like registered securities, publicly traded securities are mandatory. Reggae Plus securities is mandatory. Most funds, private funds, is not mandatory, but asset managers tend to use it because it's safer to use an entity to do that. But for instance, a private company, like let's say, you know, the shares of Bangles, you can just keep them in Carta and you don't have a transfer agent. You just have like a piece of technology to do it, but not an entity that controls the cap table of who owns shares in Bangles. I'm assuming you have a company called Bangles somewhere.

David:
[4:59] Does that mean that all publicly traded companies or at least the vast, vast majority of publicly traded companies have a transfer agent?

Carlos:
[5:07] You can't go public without a transfer agent.

David:
[5:09] Okay, can't go. Okay. Right. And so if we want the, so there are tokenized securities on chain. There are a bunch of different ways to do this. One of the ways out there is like Ondo's model, which it's not a true native security.

Carlos:
[5:24] It's not an equity.

David:
[5:25] Yeah, exactly. And so what we're talking about with a digital transfer agent is bringing the word native. So the token itself is the equity. It is not a representation of the equity. It is not a an IOU of the equity it is the equity and making it the equity is because of the transfer agent.

Carlos:
[5:47] The correct the ondo and other companies model the problem that does have besides that they block the US because the way they do it probably not regulatory compliance here etc but it's also that every tokenized equity which because it doesn't represent the actual equity you end up having five different versions of the of the same thing which none of them is the real You can go to rwa.xyz, you can see there's six different versions of tokenized coin, which none of them is actually equity on Coinbase. They're all different derivatives issued from different jurisdictions with different counterparty risks towards the company that is issuing different rights. Some of them give you voting rights, some of them don't, some of them accrue dividends in one way, some others in another. They don't track splits. Like I think Ondo had a problem recently where one of the shares in the public markets didn't split and they didn't do a split and it was trading at five times different price, et cetera. So I think that introduces a lot of fragmentation and obviously creates issues for market making, for investor disclosures and investor risks of taking counterparty risk. This is just basically like buying a share through Robinhood, but then you get it on your wallet in tokenized form.

David:
[6:53] Securitize is named as the first digital transfer agent eligible to mint blockchain native securities. I think we kind of just did a little bit of that. This is truly a native to the blockchain securities on IOU. It is that security. But the question I have for you is, Carlos, is on which blockchains? Is this chain agnostic? Are there specific chains under consideration? How are they selected? Blockchains can mean a lot of different things. And so like, talk to me about that nuance.

Carlos:
[7:21] From our tokenization point of view, and I'll let Michael answer the question about where the ATS, the trading platform sits. But we support most of the major public blockchains, obviously Ethereum, but we also support most of the L2s. We support Avalanche. We support Solana, of course. We support Aptos, et cetera. So we will be able to tokenize once we work with Azure in any of the public chains and then being able to move tokens across chains that require to be able to then deposit them on the trading platform for trading.

David:
[7:50] So you're chain agnostic, but then who determines on which chain does the asset go?

Carlos:
[7:57] Typically, we work with the issuer to agree on that because we are a service provider, right? Like we're not going to

Carlos:
[8:03] Impose things.

Carlos:
[8:04] We obviously have a view of which chains to use. As you guys know, BlackRock launched on Ethereum first, and it was only on Ethereum for a period of time. And then after that, they started going to other chains. We do a lot of also kind of due diligence on the chains to make sure they're sufficiently decentralized. They haven't had downtimes and things like that. But ultimately, the issuer is their securities, right? We don't do things without the issuer permission as opposed to other tokenization models out there.

David:
[8:32] Okay, so there's a preference on the issuer and the issuer can just choose based off of whatever their particular preferences are.

Ryan:
[8:39] And quickly, the issuer here, who is the issuer? Is that the company with the stock? That's the company with the stock. So every issuer could have a different preference around this, right? Like Exxon might have a different preference versus like Bank of America in terms of where their stocks might be issued.

Carlos:
[8:54] That's correct.

David:
[8:56] Could you do multiple places? You could just issue them and yeah, there's no restraint here?

Carlos:
[9:00] There's no restriction for us. We can either do like we do on the case of BlackRock, every ledger, let's say every public blockchain, is treated as a separate share class of the same fund, or we can just aggregate tokens across multiple chains and the cap table span across different ledgers.

Carlos:
[9:16] And we provide transparency for the issuer with respect to that.

David:
[9:19] Okay, let's get into the third part of this line that we're breaking down bit by bit. Okay, starting from the beginning, Securitize named as the first digital transfer agent eligible to mint blockchain native securities on the upcoming New York Sock Exchange-affiliated tokenized security platform. Michael, this is where I'm tapping you in. What is this? What is the digital trading platform? Tell us about what that's coming down the pike.

Michael:
[9:45] Yeah, happy to. Glad to finally get in the game. So we're launching a new trading platform. It'll be an ATS. It stands for an alternative trading system that will be adjacent to the existing traditional exchanges that will trade tokenized equities versus stablecoins. We'll support what I often describe as kind of crypto native user experiences. So things like 24-7 operations, things like instant atomic settlement, which are vastly different than the traditional exchange operations in Rails. But we're going to conform with most of the significant market structure conventions of the SEC, FINRA, and the broker-dealer subscribers that'll be participating on this platform. So it's going to use on-chain settlement, but off-chain matching. So it'll be using the NYSE's existing matching technology, market data technology, order entry technology, allowing for the community of broker-dealers who already trade on our exchanges to have a very you know, low friction glide path into supporting the on-chain settlement that we believe a lot of retail investors will be excited to take advantage of.

David:
[11:06] So with this platform and the tokenized securities that go on to the ATS, the alternative trading system, is it its own blockchain or is it aggregating the security tokens issued by SecureTies that are issued on Solana, Ethereum, public blockchains? Is it aggregating those or is it its own thing? Talk to me a little bit about the backend and infrastructure.

Michael:
[11:31] Great question. So the way to think about our system is we will run a private permissioned on-chain core ledger that's going to allow for inventory to be brought in or brought away from the platform from either digital transfer agents like Securitize or from DTC, which is the traditional book entry depository that will allow for tokenization upon request for previously issued securities. In both cases, securities are tokenized, either natively minted, like Carlos was describing, or converted. They're moved into the custody of the broker-dealer operating our ATS, and then they're available for pre-funded trading and instant settlement versus stable coins when they're sold.

David:
[12:33] Okay. I'm still looking for a little bit of clarity on where those assets actually live. That question makes sense. So in the.

Michael:
[12:43] Example of a digital native, you know, issued token, let's say, you know, Carlos works with an issuer and they decide that they're going to issue natively on Ethereum.

Carlos:
[12:56] Carlos, through his broker-dealer,

Michael:
[12:58] Can move those from that Ethereum wallet into a broker-dealer wallet in our infrastructure. I see. We will then make that available on our risk systems and our trading platform, and it can instantly be sold on behalf of that client.

David:
[13:17] Okay. Right. And so with the trading platform, the digital trading platform that you guys, I don't know if this was the first time that this was announced, but in this announcement with you guys in Securitize, you named this digital NYSE affiliated tokenized securities platform, the ATS we talked about. It is what I'm hearing is it is an aggregator of tokenized securities on Ethereum, tokenized securities on any blockchain, any layer two that you guys choose to integrate. Those tokenized securities will be sent to the wallet of a broker dealer. And then that is the person which is matching the TradFi stack of equities that then that all of that gets pointed to the ATS. And so the tokens are on chain, they're on the public blockchains, which is what I'm kind of excited about. And then for this NYSE affiliated securities trading platform, it is done through, you send the assets to a broker dealer and then those get deposited into your account and you can go and make trades like that. Is that right?

Michael:
[14:21] Yeah, I think you put it well. We haven't used the word aggregator before. I think that's a fair word to use. The way we've described it is that we're going to have, fairly broad interoperability with a number of different blockchains for settlement purposes. Having EVM compatibility to have broad access to wallet infrastructure and developer kind of community applications is important for us. But we know we're going to need to support a range of different solutions, as well as a range of different GeniSAC-compliant stablecoins for funding purposes as well. So, yeah, interoperability will be a critical component of the solution.

Ryan:
[15:01] Michael, the New York Stock Exchange, you guys have over 2,400 assets. Will all of these assets be available at some point, or is this going to have to be sort of an issuer-by-issuer conversation?

Michael:
[15:13] I think it's going to be a dual-track process. They're going to be crypto-forward, tech-forward companies that are very interested in being early amongst the native issuers. And Carlos mentioned BlackRock. That's a great example of a company that actually wanted to take a fund and make it digital native to try to position it for access and utility amongst the crypto native investor community. And there are a bunch of both corporate and ETF issuers who want to be among that cohort. At the same time, there are a bunch of traditional companies that may or may not decide that they want to actively engage in tokenization. Whether they choose to or not, the reality is that the DTC, which is the Central Securities Depository for U.S. Equities, has announced that they plan to make all of their securities available for tokenization conversion over time. They're starting with the Russell 1000, so the 1,000 securities that are in that index, plus a number of other ETFs.

Michael:
[16:22] So eventually, I'd anticipate that all NYSE listed stocks, all stocks listed on other exchanges as well, will be available for tokenized trading. But I think at the vanguard, you're going to have companies like those that are working with Carlos and prospects that haven't yet come to market that are interested in going public as tokens. Really leading the charge.

Ryan:
[16:49] How long do you think that'll take to play out until the point at which we have basically all publicly traded companies or close to all 80% say

David:
[16:56] All of them.

Ryan:
[16:57] Available on chain as well?

Michael:
[16:59] So I think there are more problems to solve than just making the tokens available, right? There's a lot of complexity in managing the sort of recreation of all of the TradFi infrastructure, the investor protections, the market structure conventions that, you know, issuers have come to expect and that the SEC requires under the law. So I think it will probably be the case that all US equities could be converted into tokens, you know, within a couple of years. But I think your question is probably when will tokenized trading become ubiquitous? And I think that's going to take longer because it's going to require not just minting tokens, but then creating the right infrastructure that those tokens have outstanding utility and can operate with an efficiency that's as excellent as the one that exists in the current market structure. So it's companies like Securitize, like NYSE, that are trying to build these platforms today to enable to, you know, sort of facilitate that migration over the next, you know, let's call it three to five years.

Ryan:
[18:11] Okay, three to five years.

Carlos:
[18:13] Brian, but I just want to give you like some metrics so you understand even if not everything moves, how big this could become very quickly. So first, I think a good parallelism is what happens with retail participation on IPOs.

Carlos:
[18:25] Because that was not available to retail people. And it started with Robinhood five years, six years ago. And then every single IPO now has a retail trans, right? And at the beginning, it was some companies, only the most tech forward ones, like Michael mentioned, that had that allocation. And it was only Robinhood, but then you got SoFi and then you got E-Trade, et cetera. And then now you have SpaceX, which is apparently doing a 40 billion IPO that is saying that 30% will be retail, right? Which is massive. So I think that the tokenist trans for IPOs and for trading for public equities will start small and then it will grow over time. But given that New York Stock Exchange only has 40, I think, 44 trillion in market cap and the whole market, if you add the competitors, it's like 100 trillion. Even if it's like, let's say, a 1% or a 2%, you're looking at 2 trillion, which is probably bigger. It's like the same size of the entire crypto market today. Because this is like the largest, you know, asset class out there. And the most liquid and therefore the most suitable to put it on blockchain rails and make it even more efficient is an asset class that is very difficult to do things with it because it's all in this very, you know, kind of rigid infrastructure and market structure, et cetera, that, you know, you can go and invest in NVIDIA five years ago and today you've made a few million dollars and you want to borrow against it and it becomes very difficult or,

Carlos:
[19:44] You know, somebody is doing short selling and is borrowing your shares and paying 35% to prime brokers and you're getting 3%. And like there's so many inefficiencies is that people don't realize that once this gets free of the existing market structures and put on blockchain, these things will open up. And I do believe we'll start small with one issuer, then five, then 10, and then 100, and it will grow from there.

Ryan:
[20:05] That is a good reminder of how large this market is. So 100 trillion in U.S. Securities, it sounds like something. And then your stock exchange is like 44 trillion. I mean, these numbers are pretty pretty astronomical relative to Grinta.

Carlos:
[20:17] U.S.

Michael:
[20:18] Market caps around like 60 trillion. I think global equities is about 100 trillion. And NYSE is the single largest market.

Carlos:
[20:25] Okay.

David:
[20:26] Okay.

Ryan:
[20:26] Amazing. And obviously, so goes the US. I think so goes the rest of the world. I want to ask another point about sort of how this works from a user perspective. So retail investor buying a tokenized security. Let's say my co-host here, David, he uses Robinhood, right? I'm a little older. I use Fidelity. Let's say, okay, so Fidelity is my broker. And so if I want the, in five years time, all of these tokenized securities on chain, if I want to buy an asset like Exxon, which is listed in New York Stock Exchange. And I want a, I guess, tokenized version of that so that I can have it in my non-custodial wallet. And I can, by the way, I can bring that wallet to another broker if I want, because I'm sort of the custodian of that wallet rather than the broker. So I'm not locked into Fidelity. I can switch at any point in time. But I should have the ability to do that essentially through my existing broker. So I log into Fidelity, I go and I buy the tokenized version of Exxon, assuming they're an issuer that that lists their tokenized security. And then I can bring that into my crypto wallet and I can go take that wherever I want. That's the future state we're talking about, right?

Carlos:
[21:30] That's exactly the future state.

Michael:
[21:32] I think you're describing a future state that's probable, right? It's not the immediate reality, right? And the immediate reality, these aren't likely to be permissionless bearer instruments. I think that we know that that is the direction of travel. Some of the, you know, sort of wrapper products that you were describing before, David, that are in the marketplace offshore. Those are permissionless, because they sort of defer some of the complexities of complying with the U.S. Regulation. So I think in order to find the solution that's going to blend permissionless, you know, kind of self-custody and all the applications that we know are high potential with the sort of regulatory blessing in order to be within the sort of U.S. Perimeter, like that work is still to be done but it's you know kind of the rails that are being laid right now by firms like Securitize that can help us get there

Carlos:
[22:36] But by the way today with tokenized securities you can have it on your self-custody wallet the only difference is that that wallet has to be well listed because you got KYC at some point right but you also KYC when you go to your broker dealer right you also KYC when you go to Binance you go also KYC when you go to Coinbase like there is this negative connotation about, you know, having to KYC. And in reality, we're being KYC every other day in any other venue. And then the infrastructure is still permissionless, right? You can still interact then with, like we integrate with Ava Horizon or we integrate with, you know, with Euler and like lending markets where the market itself is a permissionless infrastructure for lending, but the asset itself that you post as collateral is permission and your wallet has been whitelisted at some point. But what you're saying, Ryan, about connecting to a broker-dealer and being able to take your securities with you, yes, the broker dealer knows your KYC. They can wireless the wallet. They will allow you to then move the tokens to your own wallet. And then if you connect that wallet to another broker dealer, then your securities have instantly moved. As opposed to today, when if you're trying to move securities, good luck with that. It's going to take you.

Michael:
[23:41] Oh my God, I've tried.

Ryan:
[23:42] It's exhausting. It's actually like literally phone calls. And at some points I've used fax machines in order to get securities from one broker to another. It's very different. Than just like moving stable coins, let's say. And I wish for a world where it's as easy as that.

Carlos:
[23:59] It will be as easy as that as far as you've done, while listed your wallet and you move this across while listed wallets, because as Michael said, these are securities and they're US and therefore permissionless tokens today, you know, do not necessarily comply with securities regulations that force, you know, AML checks, that force, you know, if you need, the transfer agent needs to know who the holders are and there's certain obligations for transfer agent about knowing, you know, the name of the investor and things like that.

David:
[24:26] So Carlos, you bring up the DeFi and composability conversation here. So if I'm whitelisted on a particular asset, if I'm whitelisted, do I get access to the whole set of assets produced by this partnership or is it like issuer by issuer? How does that work?

Carlos:
[24:44] You whitelist once with the transfer agent and we whitelist your wallet.

David:
[24:49] My wallet.

Carlos:
[24:49] Any security will be able to go there.

David:
[24:52] And then I tell you what my wallet is. And legally speaking, I am just claiming that this wallet is mine rather than like my friends who just wants to be able to, my offshore friend who wants to be able to own a security. Well, the way.

Carlos:
[25:06] We do it is we actually ask you to connect your wallet to our platform. So we know that you can sign a transaction. So we know that you have the private keys of the wallet.

David:
[25:15] Right. Okay. And that legally speaking is...

Carlos:
[25:17] Like a small amount of ETH or do wallet connect. Like we use the same wallet connectivity protocols that any DeFi protocol uses to connect to our platform. And then we know the wallet is controlled by you and then we wireless you.

David:
[25:30] Right. And then you have as the transfer agent, you have my identity. You have the security added to my name. And then you also have my wallet where it's all kind of held. And so if I lose my wallet, I can go get the security on a new wallet, correct?

Carlos:
[25:51] Correct.

David:
[25:51] Right, because I am the owner. It's not my wallet that's the owner, it's me that's the owner.

Carlos:
[25:56] Correct.

Carlos:
[25:56] So this is not a barrier asset, as Michael said. It means not like Bitcoin or ETH that is a barrier asset, that if you lose it, you lose it. This is an uncertificated security that is represented on our blockchain. And therefore, if you lose it, you can come to us, we'll verify who you are, who you say you are, and then we'll then burn the security tokens on the wallet that you have access to and remint it on a new wallet that you've connected with us. So the cost of the risk of this is much lower than the cost of the risk of digital assets.

Ryan:
[26:26] Right, because this would apply, Carlos, the same thing if my Exxon shares were hacked or stolen or something like this.

Carlos:
[26:31] Correct, or if you have share certificates like paper share certificates which, believe it or not, still exist. And I don't know, and there's a fire in your house and they burn down and you can do that still your shares. You can go back to the transfer agent and get them back.

David:
[26:44] What about if I want to take my shares and I want to put them in Aave? That gets a little bit more complicated of a non-illegal entity, you technically just need to whitelist the smart contracts and then it can work.

David:
[26:56] Legally speaking, I'm guessing it's a little bit more complicated than that. What are the nuances here that we need to understand?

Carlos:
[27:02] Okay, that's a very good question. So there's kind of two paths to integrate with DeFi and let's break DeFi in lending versus trading because these are two different things. On the lending side of things, there's kind of two paths. One is companies like Aave, are basically building, you know, versions of Aave, in the case of Aave, it's called Aave Horizon, that are already designed to take, you know, tokenized securities as collateral. So they've already built all the necessary hooks there for me as an investor that I hold, let's say, Exxon shares, as Ryan was saying, to be able to post them on Aave Horizon and then borrow against it. And then there's a liquidator that will take them, like semi-structure as a normal DeFi lending protocol, but Aave has a separate marketplace called Aave Horizon, that works for permission assets. Then there is other, we've released something called the Vault Registrar, which is basically a vault where any DeFi protocol can integrate this vault technology to be able to take security as collateral on their DeFi protocol. And we have some people like Euler, LoopScale, Zarta, that they are now integrating that. So it's the same protocol. They don't need to do anything. And they just need to keep the collateral on a separate vault that we provide to them because that vault basically does not change the ownership of the security because you're post-it has collateral, but you're still the owner until it gets liquidated. And then we have to whitelist the liquidators because the liquidators might take possession of their security. So it's not actually a lot of friction, to be honest with you.

David:
[28:31] Whitelisting the liquidators is kind of similar to just like whitelisting a market maker. A market maker comes and says, Hey, I would like to...

Carlos:
[28:38] So they're already known entities to any protocol, right?

David:
[28:41] Yeah, they're already a professional organization.

Carlos:
[28:43] And all institutionals, et cetera. So, no, I do believe that. And by the way, this is a massive opportunity, right? Because if you think about stock lending, this is not something that is simple to do for people. Like, as I mentioned today, just go and try your shares in Fidelity of Exxon, right, and try to get a loan against them. Try and then next program tell the audience the experience of doing that. It's going to be impossible for you to do.

Ryan:
[29:08] I'm never going to try, honestly.

Carlos:
[29:09] You can take a margin loan against your entire portfolio to trade more. All brokers will give you that. But if you want to buy a house against your, you know, Exxon shares that have appreciated over time, good luck with that. Yeah. So, these are things that are going to open up big market tags. You know, equities are a good source of collateral. Like a lot of training firms deposit equities as collateral. And again, a collateral moves very inefficiently because the securities move very inefficiently because moving securities from place to place is a cumbersome process. So tokenized securities will be able to trade there. Then there will be liquid because of the New York Stock Exchange venue, et cetera. So this is going to open a lot of interesting applications.

David:
[29:46] So Carlos, basically what I'm hearing in summary is that while it's not a trivial thing to whitelist a DeFi app, it is also not that complicated either. And that the idea is we will actually be able to have tokenized securities under the condition that we are whitelisted KYC'd with the transfer agent. We will be able to have securities in DeFi apps. It sounds like we also need some participation on the DeFi app side of things. It has to be a two-way conversation, but ultimately it doesn't sound like there's any fundamental roadblocks between here and there.

Carlos:
[30:21] I don't think so. I think it's more about educating the market towards that. I do believe that DeFi, because it's a very efficient lending technology and markets, has a very bad source of collateral for lending. So introducing higher sources, higher quality collaterals like tokenized equities or tokenized treasuries or tokenized, you know, CLOs and bonds, et cetera, into DeFi markets. Is going to make DeFi markets grow because there will be more institutional participation because from a lending perspective, they are very efficient markets, right? But that's not what people are leveraging against in the traditional finance. So if we give them those tools, I think people will come and DeFi will grow again. Because give me my word, DeFi was still below 2021 levels. People don't realize that we pick at 180 billion and now we're 100. So we need to do something about bringing institutions there and that's not going to happen if you're lending against Logecoin.

Ryan:
[31:14] One of the arguments that has been made recently on Bankless, and this is actually a debate we had with two professors, but maybe I'll give you Austin Campbell, who was on one side of the argument. He's a professor at NYU Stern. He's also kind of crypto native, very familiar with this. He actually argues that open public permissionless ledgers, the change that we all love, the Ethereums of the world, for instance, the layer twos, are not necessarily the right place to tokenize securities. And the reason he says is because like what happens in the event of a hack, there's no kind of rollback. These environments are optimized for maybe more for bare instruments. They don't have identity. They don't have AMLKYC. And so there has been a push for some real-world asset activity to happen on more permissioned ledgers. This has been a debate that's ongoing. I'm wondering what your thoughts are on this.

Carlos:
[32:01] The Canton versus Ethereum. Sure.

Ryan:
[32:03] Yeah, weigh in on this debate. What do you think?

Carlos:
[32:06] I don't think that's true. So public permission. So first, this debate to me feels like the, and you guys are a lot younger than me, but maybe Michael remembers, this is the debate about American online versus the internet. Oh no, American online is safer because we control who puts their content there and who is accessing it, blah, blah, blah. And guess what happened? It died, and then the public permissionless infrastructure that is the internet

Carlos:
[32:32] is what flourished, right? Because open innovation happens on open networks, right? Because anybody's allowed to create new stuff, and that's why innovation happened there and didn't happen in America. So that's my personal view of the world, is respective of the blockchain debate. And now, in terms of whether public permissionless networks are suitable for securities, I will tell you that if you do it through a regulated intermediary that has the ability, obviously, you kind of roll back what happens, right? But actually, in my opinion, that's a positive thing because it keeps track of what history has been. If there's something that goes wrong, but you can always burn and remint to reverse a transaction because the keys of the smart contract that means those securities is in the hands of our regular intermediary, which is a transfer agent. And I know that people don't like the word intermediary, but this is a better intermediary than the intermediaries we had before in the sense that it's more less friction, you know, less things he needs to intermediate, et cetera. But it's still sitting there to provide that peace of mind to people. So I don't understand why this can't happen on Ethereum, to be honest with you.

Ryan:
[33:32] Well, I mean, on this episode, we have a representative from the New York Stock Exchange. And Michael, I'd ask you, I mean, is there anything scary about permissionless open ledgers? Any reasons for you to prefer more permission structures rather than something open like Ethereum?

Michael:
[33:47] Well, I think our regulatory obligations are going to be the same regardless of the technology choices we make. I mean, today... We're working under securities laws that were written in the 1930s that didn't even, you know, begin to contemplate, you know, electronic trading. We still have to, you know, kind of meet those standards, even though we're employing much more advanced technology. And I think whether we choose to use, you know, a sort of private chain or a public permissionless chain, we're going to have the same, you know, responsibilities. How we meet them, how we manage, you know, kind of all of those will be different implementation choices. And frankly, between NYSE and our parent company, Intercontinental Exchange, we expect to use a number of different L1 and L2 selections across our six global clearinghouses as we begin to support tokenized collateral, the NYSE tokenized trading venue, some other projects that we're developing. So I think you're going to see us probably use a number of different architectures, a number of different projects. Technology selections. But I don't think that it's going to be, I don't think it's particularly fruitful for the community to sort of beat each other. One variety or another is going to be permissible. I think all of these could be used. It's all about how you use them. But by the way,

Carlos:
[35:09] The SEC published a few months ago, an FAQ, where they explicitly said that transfer agents are allowed to use public permissionless networks to keep what is called the master securities holder file is a technical term that means the cap table if you want which is where the record of owners of the security so they explicitly said it's okay to use that a public permissionless network so I don't know what this professor is and why he's saying that it's not possible because the regulator doesn't agree with that so I mean as far as the regulator tells me it's fine I'm going to do it

David:
[35:41] We'll make sure to clip that and tag him on Twitter.

Carlos:
[35:45] I don't want to know what's going on here maybe I know maybe I follow him on Twitter and I don't know I'm I usually had a reason to say that, but my point being that the regulator doesn't agree with that, so. And by the way, this was the argument on the Gensler time of, you know, saying whether, you know, because we were using a public chain, whether we could represent securities there and they asked us to have a separate license for doing custody. You remember these Promethean guys that got this special purpose broker-dealer license, et cetera? And that has all disappeared with the new regime, right?

David:
[36:13] Michael, I want to learn a little bit more about this NYSE-affiliated tokenized securities platform. Let me, allow me to read between the lines and then you can correct me how far off course I get. So you have New York Stock Exchange, great business, been around for decades, decades, maybe longer. I don't know, actually.

Michael:
[36:34] 230 plus years.

David:
[36:36] Thank you. Centuries. Centuries. And then on along comes blockchain, like a new way to do a lot of very similar things that the New York Stock Exchange is doing. But you don't want to like disrupt what you got going on. TradFi is still basically all of finance. Don't really want to like shift that up. But we have this parallel financial system. It's got tokens, it's got blockchains. And you also need to kind of keep up with the times. And so you're building not a, you're not replacing or disrupting yourself. You are building a new parallel trading venue to go along with the new parallel financial system that runs on blockchains. And it's kind of like, well, we'll get growth over here. And if the tokenized thing and the blockchain thing really works out, we've got our flag planted with this New York Stock Exchange's affiliated tokenized securities platform. And the old New York Stock Exchange kind of just stays doing exactly what it's doing. It'll remain like trading with trading hours while the new one has 24-7, 365 trading markets. And the new New York Stock Exchange tokenized trading platform will just grow alongside that market independently of the New York Stock Exchange. And if it gets to as big as the New York Stock Exchange one day, that's great. If it doesn't, also great. But we have now two independently moving parts of the New York Stock Exchange.

David:
[38:04] This is kind of like my read on the.

Carlos:
[38:08] Yeah, I think that's a pretty fair read.

Michael:
[38:10] The reality is the New York Stock Exchange is the home of 2,400 listed companies who absolutely depend upon the liquidity and the market infrastructure that ensures that they are priced at the right values, that they're able to support the capital formation and fund the entrepreneurial business. Visions of those companies' leaders to the benefit of public investors. So it has a very important mission. It does that at great scale. A single closing auction can be hundreds of billions of dollars of value transferred. So these are really significant markets that we expect to evolve, but will evolve very deliberately. Meanwhile, with an ATS that's running alongside, we can be more experimental. We can support the issuers that want to, you know, kind of dive in versus dip a toe in into the space. And frankly, you know, I think we've grown up over those 230 plus years and certainly

Carlos:
[39:20] You know, since

Michael:
[39:21] The 1930s when the, you know, federal securities laws were enacted. You've grown up in a world that was very deliberately, you know, broken into swim lanes, where there were segregations of duties, where you had clients represented by broker-dealers, and broker-dealers traded on exchanges, and exchanges had market makers, and those, you know, transactions were held by clearinghouses and custodians, and like everyone had a distinct job on purpose. And from time to time, we've had, you know, reminders of why having those segregation of duties matters a lot in traditional finance. But we're now in a world where, you know, on-chain infrastructure can create so much utility for end investors that the risk reward of potentially like blurring those swim lanes begins to be pretty compelling. And so I think it's not just, you know, NYSE can kind of run the traditional business and see if it works out with blockchain. I think our expectation is like, this is going to transform. Like we are going to need to move this business on chain. There's some other market participants who are sort of waiting to see if the existing utilities can evolve. And once they evolve, then that will be kind of the cue to begin to do things in tokens.

Michael:
[40:43] Our view is that we need to be building. We need to get very familiar with the technology. We need to work with leaders, both in the issuer community and in the infrastructure community, to become really conversant in that space. And so, I don't know how quickly it'll be 1%, 2%, 5%, 10% of US equity trading volume in tokenized form. But by 2036, 10 years from now, I'll be stunned if it's de minimis. And so I think it's crucial that given the pace of technology adoption and change and regulatory change, You need people to sort of stake out a leadership position and begin. And so we're really excited to do that. Admittedly, beginning in sort of a modest way with a reasonably narrow field of what's permissible, but

Carlos:
[41:47] Trying to build

Michael:
[41:48] In a way that will be extensible and allow for that composability, self-custody, and, you know, greater utility that we know is the real promise of on-chain infrastructure.

David:
[41:58] Yeah. Yeah. One thing I'm curious about is to what degree does successful innovation on this alternative trading system, things like 24-7 markets, you know, the tokenization in the back end, all the innovation that is being allowed to be unleashed in this alternative trading platform, how much might we see actually float backwards into the traditional stock exchange? Like there is a big conversation, there has been ever since blockchains really became notable in TradFi of like, oh, the direction of travel is to 24-7, 365 markets. Is that something that the New York Stock Exchange wants? Is it like open to doing that level of transformation for this 235-year-old business? Or is it just saying, hey, if the market truly values 24-7, 365 markets, it'll be expressed on this alternative trading system and we'll all just allow that to grow. And, you know, tradition on the New York Stock Exchange side of things, tradition is tradition and we just have two options here. Like, will there be a blurring of the lines or more of a separation of responsibility? Yeah, I think.

Michael:
[43:08] It's a really good question. Our view is... This is going to be a long-term migration from traditional, you know, the same way that we moved from floor-based trading to electronic trading. I think we imagine, like, we will see 25 years from now, we went from electronic trading to digital on-chain.

Michael:
[43:29] I don't think it's going to move, you know, in kind of a consistent pace across all investors. I think retail will move faster than institutional. But you're already seeing the traditional exchanges expand their market hours to 23 hours, five days a week. So, you know, some of the, you know, sort of, you know, agitation that began as kind of pesky retail, you know, desires has now already impacted things like the consolidated tape and FINRA's, you know, trade reporting facility. These like very, very, you know, kind of TradFi infrastructure capabilities. So I think it's, you know, question of when, not if. I think, you know, Ryan gave his example of, you know, trying to move things, you know, in a Fidelity account. And like he's choosing to buy the tokenized version of Exxon, you know, in order to be able to have, you know, his sort of self-custody. I actually think of a more realistic example is like in the future, he won't need to make a determination to buy a token or not buy a token. People like NYSE, people like Securitize, like we're going to abstract away all of that complexity. You're going to own Exxon. You're going to have the ability to move to a different broker. You may have the ability to lend it yourself. You're going to have, you know, kind of a much broader menu of capabilities as an individual investor.

Michael:
[44:51] That will depend upon tokenized infrastructure, but you're not going have to be an expert in blockchain in order to make use of those types of capabilities.

Michael:
[45:03] Bringing those to a broad audience, that's the work that's ahead of us.

Ryan:
[45:08] I'm going to ask you a regulatory question because a lot of this has been brought about by a much clearer regulatory stance from Paul Atkins with SEC and obviously the new CFTC chair, Mike Selig. And including two or three weeks ago, they provided some fantastic guidance with respect to a taxonomy for which crypto assets might be securities and which are commodities. And surprise, by the way, if it was a security before, it's still a security. So tokenized securities will be securities. I think I have a question about the legislative process and maybe like, do we still need the Clarity Act for the New York Stock Exchange and for secure ties to proceed with tokenization? I know it would be nice, like acts of Congress can be nice and they're almost hard-coded into the United States operating system. So we don't have to worry about what regulators regime shifts might bring in terms of changes. That said, we do have some pretty clear taxonomies and rulemaking guidance coming from the CFTC and the SEC. It's hard to imagine, even in a future administration, it's maybe a little more dim with respect, dim in many respects maybe, but dim, their view of crypto is more dim and they try to reverse some of this. It's unclear whether much can be reversed. I guess what I'm saying is, do we still need the Clarity Act, is that still important? Or can you guys proceed if we don't get that with the full tokenization plan as is?

Michael:
[46:34] We can proceed... Virtually no significant regulatory exemptions and no legislative change for the NYSE's tokenization platform. That being said, getting a bill done, I think, is very valuable to the marketplace. Our parent company, Intercontinental Exchange, operates global futures markets, global clearinghouses. Having a bill that enshrines the intention of Congress into law to ensure that we, you know, don't have, you know, kind of a, you know, let's say like kind of a arbitrariness in regulatory shifts, I think will be very, very valuable.

Carlos:
[47:21] I don't think that we need the Clarity Act for tokenization. I think if you look at the Clarity Act, it's more about providing clarity about which digital assets are securities and which ones are commodities, which has been the main problem in crypto. Primarily because most of the tokens in crypto are, people are, you know, saying they're not securities and the previous administration took the view that everything was securities, right? Including like ETH and Solana and things like that. And so that's why it's called the Clarity Act because it's attempted to provide clarity there. But you started the discussion, Ryan, saying, tokenized securities are securities. So there's clarity already there. Nobody's arguing that if we tokenize Exxon shares, it magically does not become a security. By the way, some people in crypto are trying to do that, to create regulatory arbitrage and go in and do shenanigans offshore, et cetera, with securities to try to bypass securities regulations, but at least here in the U.S., and tokenize securities as security, you need to follow the same securities regulations. Now, are there other things beyond the Clarity Act that we could benefit from that will allow more things to happen on tokenized securities. That's a different discussion.

Carlos:
[48:26] We certainly, as a transfer agent, you know, the Clarity Act actually talks about modernizing transfer agents as one of the mandates, but it doesn't actually say what they're going to do specifically. That's an interesting area. Like, you know, I don't want to have, as a transfer agent, believe it or not, we need to cut the physical address of a person, which is completely unnecessary if I operate on the blockchain. I just want to have a wallet address and a name. I don't need a physical address. So there's, you know, other kind of things that will require, you know, you could modernize there, like, you know, some of the Reagan MS rules that apply to market structure, like everybody should follow the same price, best price, best execution. Or maybe if you trade in a digital ITS, maybe you don't need to do that. And market makers will figure out how to make markets efficient, like it happens in crypto where you don't have those regulations and markets are efficient across Binance and Coinbase, etc. So there's other topics of improvement, but the Clarity Act, if it doesn't pass, I think it's really bad for the crypto industry, but it's okay for the tokenization industry.

David:
[49:20] We talked about how in order for all these equities to become tokenized securities, this is issuer choice. So if Microsoft wants security tokens on Ethereum, it has to make that choice. It's not going to be because the NYC said so. It's not going to be because Securitize said so. It's going to become an issuer choice. How do we convince them to do that? And whose job is it to do that? Is that your job, Carlos?

Carlos:
[49:49] We're going to work together. It's not going to be my job. Obviously, that's my job for sure. But Michael, you can speak about that. But obviously, the one that has a relationship with the issuers is Michael. But to be honest with you, I think that once, like, we've been talking to many issuers about this. The moment we announce that there's going to be a venue, a legit venue, because obviously it's nicer, right? So it's as legit as it gets where this security is straight. The conversation has completely changed, right? Because the question before was like, yeah, sure, I'm going to tokenize. What am I, what I'm going to do with the tokenized equity? What is it going to trade? Like, what am I going to be able to do with it? And you walk them through like a scenario, a future scenario of things you could be able to do that it was not a reality yet. Now this becomes a reality. I think you will get more issues because there's no necessarily downsize, right? You know, they'll get more investors, they'll get more liquidity, they'll get, you know, more happy investors. They will come up with new ideas. Like, I'll just give you one example. The beauty of tokenized equities is that you can just prove the ownership because you hold it in your wallet, right?

Carlos:
[50:48] It's an irrevocable proof of ownership of a security. Well, today, it's impossible for you to prove that you bought Apple shares because, you know, yeah, you might show a screenshot of Robinhood, but that's not under your name. There's like 100 different broker-dealers with different apps, etc. Well, there's a wallet and a token is a token. You can always, you know, validate on chain that you own a particular security. This could open up different ways to interact with shareholders, right? Because it could say, okay, you hold my securities, then I'm going to give you a discount or I'm going to give you a preferential ticket for this event or for this other one, which today is impossible to implement because it's impossible to verify ownership of securities because there's no ledger that you can read and validate it, right? So I think that this will allow issuers to become more creative, especially issuers that have a lot of retail following of what they could do with their securities to attract more investors. So, Michael, if you want to add anything.

David:
[51:39] Michael, Carlos is on our side of the aisle here. He's a crypto person. I consider you to be on the other side of the aisle and a TradFi person. So, like, do you agree with Carlos and our sentiment that, like, this is inevitable or is it going to be maybe a little bit more nuanced than that?

Michael:
[51:56] No offense taken, by the way.

Ryan:
[51:58] No offense taken.

Carlos:
[52:00] He's pretty good. He's pretty full of thinking.

Michael:
[52:06] So our CEO, Jeff Sprecher, he has a great track record of seeing where the puck is moving.

Carlos:
[52:14] And I think

Michael:
[52:14] He has a tremendous amount of conviction that we are going to be in a world where on-chain infrastructure is the core of capital raising, of trading, of clearing, of settlement.

Michael:
[52:28] So I think we would agree that it's when, not if. But I think you have to demonstrate utility because there's so much inertia, right? There's so much inertia in the existing system. And so Carlos just gave a couple of great examples where if an issuer can get new benefit from instantly knowing who's on their cap table, instantly knowing if someone's buying or selling, You know, that's something a CFO or an IRO would get really excited about. Now, institutional investors are going to, you know, do everything they can to obfuscate their activity in the market. So it's, even if technology could solve this, there may be reasons that it won't immediately come to bear. But I think we're going to have to find ways to tokenize the existing inventory, not just new issuance, if we want to really move tens of trillions of assets quickly. So I think it's going to be not just the sort of issuer by issuer progress that we Carlos and his brethren are pursuing, but it's going to take industry-wide shifts. And that's where regulatory clarity, no pun intended, can be helpful because you have these collective action problems that really need a catalyst that operates at the scale of a nation state.

Ryan:
[53:54] Because of that inertia that Michael's been talking about, there is another way this could play out. And I'm interested in your take on this, Carlos. So love the idea of actual issuer-backed tokens on-chain that are securities, right? Because this represents actual ownership. On Bankless, we talk so often about the importance of property rights, and that gets you the closest thing to a property right as possible. There are these synthetic-type token products, and even maybe perps as an example of this on platforms like Hyperliquid. And that doesn't give you actual ownership of the security or asset, but it does give you price exposure. It seems like price exposure is what a lot of traders at least are looking for. And a lot of the capital, quite frankly, is looking for. How does a digital transfer agent and kind of the slow path of getting all of these issuers and assets on chain one by one, how does that compete against the synthetic versions of these things that can

Carlos:
[54:51] Just like be quicker,

Ryan:
[54:53] Even if it's not giving you full ownership, it is at least giving you the price exposure and maybe that's the product market fit maybe that's what people actually want what do you think about

Carlos:
[55:02] This i would not

Carlos:
[55:03] Put perps and derivatives in the same category i think perps are valuable because i mean equity markets have future markets as well right and they coexist and future markets and perps is a kind of a variation of a future market where the futures do not expire right But they also need the spot markets because they need to take their price from somewhere. And I was actually the other day with a company building perps infrastructure. And after we announced the project with the New York Stock Exchange, and she was saying, this is great because perps operate 24-7, but equity markets do not operate 24-7. So during non-market hours, you don't have pricing reference for spot price for perps, right? So I think that, you know, spot markets moving 24-7 helps perps.

Carlos:
[55:46] And I see them as completely different instruments.

Carlos:
[55:48] As you said, one thing is you want to own, you know, the stock, you want to hold it. If it goes up, you know, over time, you know, 10 times, you're going to fit 10x. Perhaps it's a different story. You have a funding rate risk. You know, if you go up, but you go up like this, you can get liquidated and lose all your money and you need to put this. It's kind of a completely different audience, right? So it's not about the same type of investors. And I think perhaps on spot markets are complementary in the way that future markets complement spot markets. Now, the derivatives, I do think that once the native tokenization exists, why would anybody actually touch five different derivatives, all of them different, all of them with different counterparty risk, etc., when you have an actual asset that is what you actually want to do? So that's because derivatives is spot market. Those guys are trading spot markets. So that's why I want to separate them from Prev's. They're just trying to compete for creating a spot market for derivatives of equities. So I think those disappear once you have the real asset. And instead of having six different versions of coins, if Coinbase tokenized coin and there's a token that is the native representation of coin, what would you actually buy the derivative? What would you actually take counterparty risk to a random company having to buy an offshore? You won't be able to access it in the US, et cetera. So that doesn't, my view, go down to zero at some point. Now, obviously, you know, because there's nothing else, that's what people are purchasing.

Ryan:
[57:07] Carlos, as we bring this to a close, And thank you, Michael and Carlos, for joining us today. There has been some rumor about Securitize. Maybe it's more than a rumor. It's actually somewhat of an announcement at some point I may have seen, which is that Securitize was going to go public by route of SPAC at some point in time. Do you have an update on that, Carlos? What are the plans right now?

Carlos:
[57:27] Yes, it's not a rumor. We actually announced that last year that we are merging with a Cantor Fitzgerald sponsor of SPAC. It's called Cantor Equity Partners 2. It's already a SPAC that is trading. We've announced that we're merging with them. At the beginning of this year, we filed the S4, which is kind of the filing you need to do with the SEC to approve the public filing and the public listing. And then we're now waiting for, you know, an updated S4 and hopefully get the regulatory process towards the end and get listed in the next few weeks.

Ryan:
[57:56] So I guess that brings the question, are you going to tokenize yourself?

Carlos:
[57:59] Of course, 100% of the first release. We're going to be the first. It was part of when we announced that was a condition for any Spark we talk to that, you know, we want to tokenize our own equity because we want to showcase all the coolest stuff that you can do with native tokenized equities and what best to do it with our own equity. So, 100%.

Ryan:
[58:17] Carlos, last time we had you on before this time was I think two years ago when we were talking about Biddle and this was the beginning of real world assets.

Carlos:
[58:23] Yeah, Biddle on to you guys were the first one scoring it.

Ryan:
[58:26] Yeah, what's, if we broaden this in a maximum view, what's been the progress in bringing real world assets on chain from two years ago until now? What significant milestones have we accomplished?

Carlos:
[58:38] Well, I think the growth of the entire space, and again, it's very controversial, the metrics, because what do you count as tokenized assets? Do you count these closed networks or they're not? But by any metric, this has been growing faster than anything else. It's grown faster than stable coins that have been growing. It's certainly grown faster than crypto that has been declining. So this has been the fastest growing part of the market. I do believe that BlackRock entering the space was a catalyst for adoption because

Carlos:
[59:07] obviously they're not, they're a very influential company. The tokenized treasury space that the Biddle plays, which is still the largest asset, I think it's worth 2.3 billion or something now, it was like 300 million two years ago. And now it's 11 billion. I don't think any part of crypto has grown that fast. But that said, I think we're still scratching the surface. I like last week at Das, Chair Atkins in his speech, He said, we are at the end of the beginning.

Carlos:
[59:35] So it kind of feels that way for tokenization that we're at the end of the beginning.

Carlos:
[59:38] Now the beginning has happened. Now we need to get into the real growth because the space is so massive. As we discussed before, just taking 1% or 2% of the stocks on chain doubles the size of crypto. So the fact that we have tens of billions of dollars still feels like very, very early days.

David:
[59:56] Before we let you guys go, I want to ask about the timeline for this whole thing. So this was an announcement of a partnership. When does the actual product happen? Is this like a 2026 thing or a 2028 thing? Michael, I think maybe this is a question for you.

Michael:
[1:00:11] Sure. So subject to regulatory approval, we'd expect to launch in Q4 of this year. For issuers that are interested, that's right. For issuers that are interested in native issuance, they don't need to wait for our ATS to be live. They can begin to work with Securitize and their peers to begin on-chain issuance. And then those products would be eligible for trading on our platform once it's approved.

David:
[1:00:39] Wow, okay. So firmly in the 2026 timeframe. That's great. That's great. Well, congratulations, guys. Pretty cool to see some of the very early visions of tokenization manifest into partnerships that we can go.

Ryan:
[1:00:50] Talk to you guys about. Yeah, I mean, welcome on chain.

David:
[1:00:52] Yeah.

Ryan:
[1:00:52] Welcome on chain to the New York Stock Exchange.

Michael:
[1:00:54] It's a big deal.

Ryan:
[1:00:54] Thanks, great to be here.

Carlos:
[1:00:56] And it's bangless. There will not be banks there. It's only broker-fuelers and exchanges.

Ryan:
[1:01:00] That's right. That's right. Doing this to bank this way would be fantastic. Guys we gotta leave you with this of course none of this has been financial advice you know crypto is risky even the tokenized security form you could lose what you put in we are headed west this is the frontier it's not for everyone but we're glad you're with us on the bankless journey thanks a lot