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275. Crypto Update: The U.S. Bitcoin Reserve, SBF’s Prison Interview, and 24-Hour Nasdaq Trading
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Join us for this episode of A Wiser Retirement® Podcast as we explore the U.S. government's growing Bitcoin holdings and the potential creation of an official Bitcoin reserve, a proposal now under legislative review. We also dive into the latest developments in crypto regulation, Sam Bankman-Fried’s unauthorized interview with Tucker Carlson, Binance’s legal challenges, and NASDAQ’s bold plan to launch 24-hour trading by 2026.
Related Podcast Episodes:
- Ep 266: Crypto Update: SpaceX Uses Stablecoins, Trump’s Meme Coin & Altcoin ETF Filings
- Ep 270: Crypto Update: Meme Coin Resurgence, ByBit Hack & Crypto Taxation
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US Government's Bitcoin Holdings
Speaker 1Depending on the price of Bitcoin. The US holds roughly just shy of 200,000 Bitcoin. It is the largest state holder, government holder in the world. China roughly has less, and then it quickly falls off after that.
Speaker 2Welcome to a Wiser Retirement Podcast. Are you curious about what's happening in the world of cryptocurrency? I'm Casey Smith. Today, I'm joined with Robert Swirthal, founder CEO portfolio manager at Teton Crypto Capital. Every week, we bring you practical advice on retirement, investing and planning for your financial future. Don't forget to subscribe to the podcast wherever you're listening. Good morning, robert. Let's get started.
Speaker 1Good morning Thanks for having me.
Speaker 2So there's been a lot happening. My little tid, little tidbitty you guys can look that up has the crypto, has the brave score, you know crypto news. And then it has the weather at the airport Cause that's important to me, but Bitcoin's moving a different direction than than we we thought. Yeah, but that's typically how markets work, for that Right, when everyone thinks it's going to go one direction direction than we thought would happen.
Speaker 1That's typically how markets work, though, right? When everyone thinks it's going to go one direction, it goes the opposite.
Speaker 2Exactly, and I keep telling everybody it's a 10-year game, so you're only about months into a 10-year investment. That's how you should look at it. So what's happening with? We'll start off with Bitcoin Reserve. I don't know if people caught this in the news or not. Most people probably have no idea what it's about.
Speaker 1Correct? Yeah, it's. You know, I would say. Of all the things we're going to talk about, this is probably the biggest topic of this whole episode, and this goes back to July of 2024, when Trump talked at the Bitcoin conference in Nashville. He promised to set up a Bitcoin reserve. In some sense, this is him fulfilling a campaign promise. We'll kind of get the political part out of the way here and kind of move on to a little bit more of the details. So he did sign an executive order which immediately the next president could undo. That's how all these things work, but there is a hope that this Bitcoin reserve does get put into law. There's a law in draft form leaving the committee from Senator Loomis that will enshrine it in law.
Speaker 1But the whole idea is there's a Bitcoin reserve and there's a digital asset stockpile. These are two different things currently the way that they're talking about them, and they function a little bit differently. The Bitcoin reserve is currently made up of all the Bitcoin the government currently holds, slash, owns, and this has all come from forfeitures or illegal activities that they've gotten from criminals. The government to date has not bought any Bitcoin. We should be very clear about that. The digital asset stockpile and they named a couple other tokens, but I think really this is more of a broad bucket that will basically be set up in such a way that anything that is also seized that is not Bitcoin would put into the stockpile Ethereum, xrp, ada, solana. You kind of go down the list and, if any of those are held, the treasury, which will quote unquote custody. This I don't think they're actually doing the physical custody, but they're the ones in charge of running the reserve and the stockpile. At their discretion, they could buy or sell anything in that stockpile. What they do with the funds is kind of a bit up in the air. If you ask the Bitcoin maxis online, they're going to say that it's so you could only buy Bitcoin. That is the way that they're approaching this, but I think there's more details to be fleshed out Also. I think that's why a wall is going to be important. It kind of helped put some guardrails around this.
Speaker 1There's also talk about potentially finding budget neutral ways to buy Bitcoin. I have to admit this is where my opinion comes in here. I'm not a big fan of having a reserve and a stockpile. I think it should be all one in the same, or we should. I don't understand why we're playing by different rules. It is definitely a lot of lobbying on the back end by the Bitcoin crowd to kind of get this different status because they in their mind are digital gold and kind of go with that. But you know it's a, you know you could even back up and you know I'm probably still 50-50 about where this should even happen period. So I don't know. Do you have any thoughts on whether the US should be holding any crypto?
Speaker 2Well, I guess it depends on what it's being used for. I think having a reserve well, not selling it helps crypto, because there's so much of it, right, so they flooded the market with it, right, you can fit the price, I think, as a US taxpayer owning the crypto. If the crypto goes where we think it is over the next 10 years, that's probably good for the US taxpayer, right? It's no different than TikTok. So, having a reserve, it should just be part of the sovereign wealth fund.
Speaker 1You could make a case that it's better fits in that if it's going to be a managed asset a managed asset, which I think to me it fits better over there the idea that the US is so also interested in investing to me, we got to balance the budget first. I mean, this is a very political statement. I get it, but we need to have a balanced budget before we have the idea that we have money to invest. I get that we're currently only holding crypto that has been seized, so we didn't actually have to buy it. But you know, at the end of the day, if you're going to hold this forever, I guess it does help the stability of the dollar a little bit as an asset, but at the end of the day, this is not a income or cash producing vehicle of any kind these cryptos so it's. Do we know what the value of the stockpile is currently? That's a great question. What the value of the stockpile is currently, that's a great question. So, depending on the price of Bitcoin, the US holds roughly just shy of 200,000 Bitcoin. It is the largest state holder, government holder in the world. China roughly has less, and then it quickly falls off after that.
Speaker 1The joke recently is the North Korea beats the US to having a Bitcoin stockpile or reserve because the recent Bybit hack. They got $1.6 billion. That's a joke, probably 100% joke. I can't imagine that it's purely for stockpile. I'm sure they will sell it to do something with, but it's um, it's. You know I, like I get that. A campaign promise happened here and I, as a crypto person, I generally think this is a positive but, like I, have a lot of questions and just the way that the news cycle went on this, like Trump announced it on a Sunday at 10 30 in the morning, the first tweet or to me, the first post he put out on truth social was he talked about XRP, solana and ADA, not Bitcoin or Ethereum. An hour later he added oh, I also truly love Bitcoin and Ethereum.
Speaker 2It just seemed you know off the cuff and it was just odd. Yeah, I mean it's not. If you liquidated everything, it's not enough to balance a budget. So right, we're talking. I mean, granted, this is billions of dollars.
Speaker 1If you liquidate everything, it's not enough to balance a budget. Right, we're talking, I mean, granted, this is billions of dollars, but yes, our budget is measured in trillions, and this is a bit of a rounding error.
Speaker 2So we're short 2.5 trillions If you think about it. I mean, the government still has to have assets, but yeah, I don't know what does it do for crypto to have a reserve.
Speaker 1I I think if you just say take politics totally out of this, I think it purely says we've elevated up to having a different level of visibility. The government cares about it, the government's not trying to kill it and it's willing to at some level. You could say support it. Um, is the way that I would frame it.
Speaker 2All right, so $18 billion to buy a few votes that's what it comes down to.
Speaker 1Yeah, and the price pumped really heavily the day, at least on the tokens that were announced, and then it is pulled back below that in the weeks following. But yeah, I think that's probably a good wrap on that and it's interesting, they announced the stockpile the week leading into the White House Digital Asset Summit. So that was on a Friday. This was the previous Sunday. So the Digital Asset Summit was built as, and built up as, a gathering with the president and industry leaders.
Speaker 1In some ways, it was a lot of people that gave money to the Trump campaign got to be at the White House, got to sit at the table. That's where Trump talked about FIFA being part of crypto, and there was a whole bunch of just weird angles to it. At the end of the day, nothing material came out of it. In my opinion, like all the news had already happened the five days prior six days prior. But you know, if you would have asked me two years ago if the crypto company CEOs and other important people in the industry would be sitting at the White House with the president, right, and it not be about because they just got arrested, I wouldn't believe you.
Speaker 2So I don't believe you. So times have changed. This is a little off topic, but does the US even need a sovereign wealth fund? I mean, we have capitalism right. I go back and forth on that. It's like do we really? We hold gold supposedly. So if we have gold right, then why wouldn't you have other assets as well? But I don't know that the US needs a sovereign wealth fund. I don't know that. We even need to own half of TikTok. To tell you the truth, maybe the US gets a broker fee to find the right buyer.
Speaker 1I've thought a little bit about this and what I got to was this is just obviously purely my opinion. At the end of the day, typically, the government is an absolutely atrocious manager of any sort of money and, do we like, until we can prove that we can manage better, do we really need to be giving, you know, billions of dollars to these type of people? And at the end of the day, like the, you know, maybe the person that's in place now that Trump set up to run the sovereign sovereign sovereign wealth fund does a decent job, but we have no idea who the next person in charge is going to be.
Speaker 2So it sounds like a lot of bad things could happen in the future. But I don't know, I mean, obviously I haven't put that much thought into it. I just I just know that we don't have like Saudi Arabia has a huge wealth or sovereign wealth fund, right, but national resources are oil and so that's where their way of diversifying out of that in the US we don't really have that issue. So it kind of goes back to let free enterprise be your, be your thing is you're. The people here are going to benefit most from free enterprise than they are Right Getting money to them like they do in Saudi Arabia.
Speaker 1Right. And yeah, those Middle Eastern countries with all that oil, like they're, if they don't diversify out of oil, they're a one trick pony Like um, and they they quickly need to try to figure out how to do something else. And you know they're trying to be a financial hub. I mean, they're trying, um, many of them, um, the U? S, to your point, already has a bit of diversification. So we will see. I guess we can look back in 10 years and come back to this episode and see how it went. So I guess we kind of alluded to the Digital Asset Summit here a little bit.
Speaker 1A couple of points that I think are worth making is at the summit, trump said that he wanted to have stable coin legislation done through Congress by August. If that happens, that would be awesome. I'm done playing the game of oh, we're getting close. It does feel closer than it's ever felt before, but I'm just not playing the guessing game on timing anymore.
Speaker 1The bill that is called the Genius Act did get passed at a committee the banking committee, I believe this last week. So it is on its way, albeit Congress is slow with these kinds of things, I guess in relative terms. So it's coming, and that would be the first building block, I think, to truly get regulations for everything else. You have an SEC, you have a CFTC, you have the OCC and other different organizations that seemingly want to work together all of a sudden on whether it's a crypto, cryptos or securities or their commodities or there's something else I think that we're going to end up with multiple baskets and I can't say it's going to happen this year. I think that's a bit far fetched, but maybe early next year.
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Speaker 2I saw the headlines for Digital Assets Summit. I think it's funny because you think, as an industry person, you go to a conference, you go to a hotel, you have this grand conference room. There might be a grand hall, right. So there's like 2,000, 3,000 people there. That's what you think about when you think conference or summit, right? Yeah, so I was. I was just wondering at the white house, like how does the summit go at the white house?
Speaker 1Well, that's. It's funny. You mentioned this. So I think it was roughly 2,000 people big table. But what they did have after that, basically that media event, it was like a one or two hour thing and then they went across the street and I think there was a couple hundred people there. But again, everything in DC is all revolves around the politics and a handshaking. I think it's less about summit and learning anything and more about the 15 second news clip that everyone's trying to get. So Right, Exactly, yeah, so we're kind of moving on here.
Speaker 1Our next topic is the OCC. This one flew under the radar a bit. They came out, they rescinded the Biden era basically I wouldn't say called regulation, but decree that banks could not custody crypto, crypto. While it wasn't as strict as that banks could, but the way they had to account for it in their balance sheet made it basically no bank would ever do it. That was one of the angles that the industry was attacked on. But they came back, they rescinded it and now banks can custody crypto and, surprisingly enough, banks are talking about custodying crypto.
Speaker 1Shocker, here we go At the end of the day. It's early, but you're already having. I've heard somebody at a conference. I believe it was somebody from JP Morgan and not Citigroup Goldman talk about their options actually be the custodian. They may be just be the interface to the custodian. It may end up at something like a BNY. I know BNY is working on custody and they actually had an exclusion underneath the Biden era stuff. So they had a bit of a headstart, but no one really was, my understanding, using it at great scale yet.
Speaker 1So we, you know it's, we're going to kind of get to this in a little bit, but there's a lot of changes happening really quickly and then we go through periods where nothing changes and it's sometimes hard to keep up with something as big as this. That ends up being small news for the week. So Kind of, if we kind of jump to a bit of a funny, bizarre world here, Sam Bankman Freed's in prison. Bizarro world here Sam Bankman-Fried's in prison.
Speaker 1He is still in the Manhattan Detention Center, MDC, and he shares the same cell block as P Diddy. So we have some very different characters in there. And he somehow I guess he has a cell phone in prison or did, but he did roughly a 30 minute interview with Tucker Carlson on Zoom, where Tucker just sat there and interviewed him. We, like I watched it and it seems like a totally legit thing, Like it was planned, like it was set up, as the cameras clear. So this post online and like, within, I think, hours, if not the next day, he was put in solitary confinement because he did it in a legal interview from prison.
Speaker 2Oh my gosh.
Speaker 1And the crazy thing about this how did they get a phone to begin with? Who knows what happened. I mean, how did they get drugs in jail? I don't know. I'm experienced in this so I can't really answer your question, but they went through a wide ranging topics.
Introduction with Robert Swirthal
Speaker 2I didn't even know this story story, so was he pleading for uh, for a pardon?
Speaker 1um. So one of the questions tucker asked him I was like, did you reach out to see if you could get a pardon or anything? He's like sam, he always have to take everything he's saying with a grain of salt. But like he was like no, I, you know, I didn't try to use that angle because I didn't feel like it was right. I'm like all of a sudden you're feeling like you know what's right.
Speaker 1But we talked about he talked about the future of crypto under Trump. Does SBF have any money left? They talked about the altruistic cult that he was a part of. Effectively, it was a bit wide ranging, albeit roughly 40, 45 minutes, and he even talked about P Diddy a little bit. So it's pretty crazy, but what the internet is awesome at. So I watched this interview. A day or so later, somebody had dug up a document that was shared as part of the bankruptcy proceedings for FTX and there was a Google Doc that Sam had that if he ever got in trouble, these are the things he would do to try to get out of trouble. And no joke, one of the things on it was he would go on Tucker Carlson to appeal to the right.
Speaker 2Oh wow, he's just going down his list.
Speaker 1He's functionally going down his list. I was like man, this guy is like just like so orchestrated. Man, this guy is like just like so orchestrated. Um. So anyways, um, it kind of you know this is this is something to laugh at.
Speaker 1There's nothing serious going on here, but I think for something like that, 20, 25 years, Um, so they did talk about he would be in his late fifties when he got out. How do you feel about that? And he was a bit somber in that moment. Um, you know it's. You know prison ages you quicker than the average um person. So you know that's functioning like being in your 70s, probably. So right, that's, we'll see. Um.
Speaker 1Our next topic um cohorts end up in prison no one else no one else, no um some people some people, well, or maybe it was like very light sentences I forget the exact details, but some people pled out with, like the fine only, or major fines, I mean millions of dollars, or there was a few, I think, some community service, but maybe some with a couple of years, but even Caroline, basically number two there, I don't think, since she was basically ratting him out. Yeah Well, didn't rat him out, he did it himself, but like she basically talked to the government and spilled the beans. But then you have C over CZ, yeah, yeah, so what?
Speaker 2I don't see that on your list today, but but I mean, basically he's getting, he's getting cleared by Trump.
Speaker 1So I did send you that. It obviously is not in our notes here, but the so cz is was the ex-ceo of binance. He started binance, um, binance was doing money laundering and some bad stuff. Um, they weren't doing good aml and kyc effectively and so cz went to jail for four to six months. Um, he is out. He is, um, seemingly on a, you know, on the right side of the law at this point. But there was a rumor floated that the Trump family was trying to buy part of Binance and CZ was trying to get a pardon. I'm like, okay, this seems highly suspect from both angles. Both angles. Cz came out and said I am not selling part of Binance and I'm not looking for pardon. All of this was on the heels of a family from Abu Dhabi basically putting $2 billion in Binance. That was a legitimate news that happened. Then, all of a sudden, it looked like the Trump family was trying to tag along and I was like I want crypto to be taken seriously, but we cannot have this kind of crap happening.
Speaker 2Um, if it's going to be taken seriously it does not appear to be, but we will see. He got off pretty easy. In my opinion, especially the money laundering is going to really bad things. So he, uh, he got a break, yeah.
Speaker 1Yep, um, and so that's that bit. The next one is kind of a bit more up your alley. So the NASDAQ has announced that they're looking in early 26, 2026, to launch 24 hour trading. I don't know if it's 24 seven trading, but it's 24 hour trading. And the first thing that popped in my mind was like, oh, we're just going to tokenize all this on the blockchain and make it easy. I don't know if that's exactly the news item, but the news cycle. We're trying to bury news at 5 pm after the market's closed. That window seems to be closing.
Speaker 2So if you launch your company with NASDAQ, with 24-hour trading, do you also get free Red Bull and coffee for life?
Speaker 1Yeah, I did see. It's not in the notes here, but NASDAQ is opening up a second headquarters down in, I think, austin or somewhere in Texas. That'll be open early next year too. Maybe that's all wrapped together. I haven't seen anything actually tying it, but I did wonder that.
Speaker 2My first question to that is how do you keep the volume up to be able to do 24-hour trading? Because in the markets, like on the NYSE, the stocks don't open all at once. The stock market opens at 9.30, but it takes about 10 to open up every single station, every single company, by 10,. Most things are trading by 11.30,. That's the optimal time to be trading. If you're doing anything that has something to do with foreign securities, that's more related to ETFs, but you have supply-demand all day long. Right, it's like you'd have to have peak hours. In NASDAQ you have, or NYC, you also have after-hours trading or pre-market trading. That's a small window. I just want to maintain the volume for buys and sells. I mean, it's computers that are obviously doing it, but you have to have somebody on the other end hitting buy, submit. So I bet you there would have to be at three o'clock in the morning. It's probably not the best time to be selling your stock that's all you would.
Speaker 2You would think the volumes or the liquidity would be low, but you'd have to get you'd have to get the world to buy in, like you need other people from other countries, that when we're sleeping Asia, you need them to be able to trade on that exchange. I don't know the rules on that. I'm thinking that it's. It's not as easy as as us, yet, as a citizen, is placing trades and also, you know, it sounds like a great way to get your markets manipulated when everyone else is sleeping. Yes, absolutely.
Speaker 1Um, I just have a lot of questions about that yeah, I, you know what I wondered was is like, and I don't know the answer what percentage of the current volume is this act like computers doing the trading, like, um, like?
Speaker 2I are, and as I think it's all computers. Right well, I know it, like AI, or, and as I can, I think it's all computers.
Speaker 1Right, Well, I know it's like physically done with computers or electronically done, but like like, is it algorithmic trading Like is it actually a person clicking buy or sell or is it actually done with computers? Cause if it's done with computers, they can go 24, seven.
Speaker 2So it's just true. That's true. I don't know. I just yeah. I had so many questions with that. I mean, you think about, okay, there's times when weird things happen, like I remember at a business lunch and I was in business lunch in New York and in the amount of time that took me to have an hour and a half lunch with somebody, I came out, we had the flash crash. And imagine having a flash crash at two o'clock in the morning. What are you going to do? I mean, you're sleeping. You don't know Someone's going to call you wake you up, your phone's buzzing because all these alerts are going off with stock prices. I don't know. I understand why they'd want to do it, because now it's 24 hours of revenue. You're getting a half. I understand why they'd want to do it, because now it's 24 hours of revenue.
Speaker 2Yes, you're getting a half a penny or a penny a trade. Now you can do this 24 hours a day, right, generate revenue for the exchange, but I just don't understand why it's worth the risk. I think that's interesting. Yeah, 7 am to 10 pm sounds great. Yeah, 7 am to 10 pm sounds great.
Speaker 1Yeah, as someone in crypto that has 24-7, 365 trading, the idea that you have to be woken up in the middle of the night just seems normal. So I'm having trouble sympathizing. That's my point. That's my point, anyways, so we can move on. So you know kind of a bit of a recap.
Speaker 1So, like I kind of said it a bit ago, the there's weeks when decades happen, and that's really what the last week or the week of this news this is roughly two week old news, but it's just kind of crazy when you kind of look at the list, you know against strategic Bitcoin reserve the digital asset stockpile the OCC allowed banking in the system. The digital asset stockpile the OCC allowed banking in the system. The crypto summit SEC dismissed more enforcement actions against Kraken and some others. The Senate voted to kill the IRS broker rule, which we didn't even talk about. That's a big deal and I can also say, since we literally started recording, the SEC and Ripple just announced they dropped the case. So that is a big news thing. I don't know the details there so I don't want to say too much. We'll probably pick that up in our next episode.
Speaker 2That's equivalent to Ukraine and Russia saying, yeah, we're not going to fight anymore, if you think about the destruction that took place during that whole thing, hundreds of millions of dollars in legal fees that we'll never get back from both sides.
Speaker 1Effectively it's. It was not, not, not productive. We'll be. What will be interesting to follow up on is, like, what are they doing about the $125 million fine that ripple was supposed to pay? Are they still paying that they're not going forward, or what the deal is? But again, we've got more homework to do, we'll? We We'll talk about that next time, I'm sure Right.
Speaker 2Interesting. That's big news. I think that covers it, so that's cool. Thanks for doing this with us. You know this is definitely the future. I think we should do an episode in the future on use case scenarios, because I feel like more use cases now we're starting to get close to what that actually is allowed to happen right Regulations, stable coins.
Speaker 1Yes, I think education will start to be Now we're starting to get close to what that actually is allowed to happen Right Regulations, stable coins yes, I think education will start to be more important and something that's you can point to it actually is happening, versus this could happen, right, I know.
Speaker 2Yeah, all right, that's cool. Thanks, robert, we'll see you next time.
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