Tokenization Is the Next ETF with WisdomTree

Franklin Bi (Pantera Capital) sits down with Jeremy Schwartz, Global CIO, and Maredith Hannon, Head of Business Development for Digital Assets at WisdomTree, to explore why tokenization is doing to ETFs what ETFs did to mutual funds, and how WisdomTree is building the infrastructure to make that happen.

WisdomTree has been at the frontier of every major wrapper evolution in asset management. From alternatively-weighted indexes to ETFs, and now to tokenized real world assets on eight public chains. With over $700M in AUM growing 6x year over year, their tokenized money market fund WTGXX is already being used for corporate treasury sweeps, cross-border payroll, and stablecoin reserve management.

Key Topics:

• The ETF analogy: tokenization is to ETFs what ETFs were to mutual funds, democratizing access from brokerage accounts to smartphones, and WisdomTree has been building for this moment for years
• Why public chains over permissioned chains: permissioning belongs at the token level, not the chain level, and the real users are already on public chains
• WTGXX in practice: $700M AUM growing 6x year over year, used for corporate treasury sweeps via StableC, cross-border vendor payments, and payroll via Toku and Plume with block-by-block yield accrual
• The product roadmap: from money markets and treasuries to equity betas, derivatives, and option income strategies, and why WisdomTree rebalanced 3,000 model portfolios with JP Morgan and Apollo using smart contracts
• Rookie mistake and pleasant surprise: trust matters more in crypto than anyone expects, and Europe led the US on crypto ETPs by five years

Transcript

SPEAKER_00 0:00

We deployed onto five EVM chains in one day. That is something that in the traditional markets, you can't do five integrations or different applications in one day.

SPEAKER_02 0:08

You know, what we kept asking, what could do to ETS what ETS did to mutual funds? And tokenization has a lot of those features that could be very, very disruptive.

SPEAKER_03 0:17

Welcome to this episode of Stateful. I'm Franklin B. Journal Partner at Pinterest Capital, and I'm excited to continue our institutionally minded series of Stateful, where we shine a spotlight on blockchain tokenization and digital assets and the most porn conversations happening around those topics inside institutions today. So our goal is to help you understand this moment of massive transformation in capital markets and digital asset investment by hearing from the people who are actually making it happen. And so I'm excited to welcome Jeremy Schwartz, Global Chief Investment Officer at Wisdom Tree Asset Management, and Meredith Hennan, Head of Business Development for Digital Assets at Wisdom Tree.

SPEAKER_01 1:01

Welcome to the podcast.

SPEAKER_02 1:02

Thanks so much for having us.

SPEAKER_01 1:04

But before we begin, a quick disclaimer: this content is for educational and entertainment purposes only and does not constitute financial investment or legal advice. Please do your own research before making any investments.

SPEAKER_03 1:14

I'd love to uh kick off maybe uh with uh a topic that the audience might not be super familiar with, which is just the history of Wisdom Tree. Um, obviously a firm that's been a trailblazer through multiple phases of uh markets in the past and now really being a trailblazer for this new age of tokenization and blockchain. Uh Jeremy, you've obviously been uh at Wisdom Tree, I would say, as a lifer, perhaps. And I'd love to I'd love to hear from you. Um, you know, how you think about just the history of the firm and where uh it's it's gone from before to now, and how tokenization and blockchain fit into that story today.

SPEAKER_02 2:00

Well, Fricklin, I I've been with Professor Jeremy Siegel from the Wharton School for this month, is our 25-year anniversary of working together. So I started with him. Siegel, when I was there at Penn, was becoming famous for his op-ed on big cap tech stocks where a sucker's bet in March of 2000, is like one of the most widely cited Wall Street Journal articles ever. He was going from his own transition of being a vanguard by the market cheaply to a value investor, sort of Warren Buffett style, helped him on his book, The Future for Investors, that came out in 05. And that was a precursor of Wisdom Tree, which was trying to create these alternatively weighted indexes. Our CEO, Jonathan Steinberg, had discovered ETFs in his publishing days in the late 90s. And he said, This is the future wrapper. I need to be a part of it. I think this is going to be the future of asset management. And so he started building his own indexes. We sort of relaunched, he raised capital in 2004. Siegel joined as an investor, as a strategy advisor. And so I'm now our second longest employee, like he said, Lifer, uh, with uh with Jonathan, our CEO. And I think the history has always been uh, you know, we thought ETFs were the best wrapper then. As we think about today's state, we continue to think about what are the next best wrappers. Um, and we do think tokenization has that potential. You know, what we kept asking, what could do to ETFs what ETS did to mutual funds, which is now like if you're doing any innovation, it's happening in ETFs um in asset management. And and tokenization has a lot of those features that could be very, very disruptive. And so we started investing in that uh a number of years ago. It's a very interesting ecosystem, and we sort of take great pride that WisdomTree is uh is innovating this space.

SPEAKER_03 3:43

Yeah, it's amazing. Meredith, I'm I'm curious from your end, when did you sort of cross the threshold uh from public chain, from permission chains to public chains, uh really being the focus and the approach that WisdomTree is taking?

SPEAKER_00 3:57

So we've always been a public chain uh from an ethos perspective. So we actually never crossed that threshold. We never even made it there. We said if you really think about how, to Jeremy's point, ETFs revolutionized access via a brokerage account, we see tokenization revolutionizing access through a smartphone and through the internet. And therefore, being on public chains just makes a lot of sense. I also think that there was an understanding a few years ago that in order to get privacy, in order to have control over these assets from a regulated financial services business, you needed to be on a permission chain. That's the way that you would be able to control the assets. When we always thought the permissioning should be at the token level. So that's what we've built out is that we have controls at the token level. So they're able to interact on public chains. That's also where the majority of the actual end users are. So if you think about tokenization being able to provide access to the masses, those masses are going to be retail investors that are on these public chains. So we wanted to make sure and build our infrastructure to meet our customers and our clients where they are, which was on public change, which still is on public chains. And I think just as more and more institutions have come into this space, understand the technology, there's also been significant developments over the last five years in privacy, in control, in understanding how regulated products can function and can move this value on public chains. Um we've seen that uptick, but that is something we're on eight public chains. Um, we have been for many, many years. Um, our retail app is all on um Stellar a public chain. So we really take pride in that. We think that's a real focus of how to see this market truly grow and scale, which is our focus as well.

SPEAKER_03 5:51

You mentioned that uh you you're now on eight different chains, and I'm curious to dive into that a bit. Um, you know, one of the questions that we get from our LP base, from founders, uh, oftentimes is, you know, are we going to be in a world where there's a single chain to rule them all or a hundred different chains? Uh I'm curious what the internal discussion was around that, um, you know, deciding which chains to launch on, how to prioritize them, uh, and ultimately um, you know, how you see the the future of that landscape developing.

SPEAKER_00 6:29

Sure. And this is a consistent debate. We are always looking and examining what's new, what's different. Um, I mean, I started here four years ago, uh right when Solana started, and now Solana is where it is, right? So there's always going to be this continuous evolution with new technology. So for us, it's not so much as of a debate as much as it's about opportunity. So again, thinking about distribution, thinking about new use cases, what's really powerful about this technology is that it can be standardized on public chains. So for instance, I mentioned we're on eight chains, we deploy it onto five EVM chains in one day. That is something that in the traditional markets, you can't do five integrations with different partners or different warehouses or different applications in one day. But because of this standardized technology, we're able to. So I think that's what we're really focused on is what's the community, what's the ecosystem? And are they investing in tokenized real world assets meaning as a community? Is that a focus of the foundation? But then also, what is their consumer base like? Who are the wallet holders? How are they interacting with the chain? There's so many different ones, whether it's now from payments or whether it's perps, or maybe it's on something related to a specific app that's focused on cash or treasury management. That's how we're looking at individualized opportunities and then the underlying chain that would be supporting that is how we start to think about the commerciality of our business in terms of what we see for the future. Um, there's many chains. Maybe there'll be a winner. I have a feeling there's going to be many more than one winner because they're also now more and more being purpose built for who is building on top of them. So instead of having these broader, um, you know, one size fits all types of chains, we're starting to see ones that are very focused for specific use cases. And I think those will win in their specific sectors. And then there will be other ones that are going to have a broader remit for gaming or for what have you, based on what the users need and also what the developers need.

SPEAKER_03 8:41

Yeah, that's something uh we hear a lot now from institutions overall, which is, you know, the conversation has shifted from blockchain as this back-end technology and sort of you know, source of efficiencies to now being a front office conversation, right? How does this actually give us new access and distribution channels to new customers? And how do we, you know, what can we actually understand about what those customers want? Uh and that's I think really helped um motivate people uh across those institutions to actually get excited and and think about the opportunity in a bigger way. I'm curious to dive into um Wisdom Tree's tokenized money market fund a bit more, WTGXX. Um, you know, I think there's there's a uh sort of valid um argument that it's quite an opinionated product amongst a pool of, you know, uh uh many different tokenized money market funds uh in the market today. Uh but so far, you know, over 700 million in AUM, growing um 6x year over year. It seems like it's doing very well. Uh curious to walk through uh how how you thought about launching WTG XS initially. Uh, what were you hoping to achieve? And how has the thinking evolved since the launch? You know, what have you learned?

SPEAKER_00 10:05

Absolutely. And I'm happy to kick off and and Jar, please, uh Jeremy, please um add in here too. So, what's interesting about our tokenized money market fund is that we launched a full suite of products at the end of 2023. And then through conversations, predominantly with stablecoin issuers, they were asking for a money market fund. They wanted that stable $1 nav. Um, they wanted it even before the Genius Act, but that was really what they were focusing on for reserves. So we said, okay, again, we are very client focused. We build solutions for our clients. Let's launch a money market fund. So actually, our tokenized money market fund is our only money market fund. Um, we don't have a traditional one, unlike many of our competitors. And what I think is really great about that is that we can build a product specifically for the client base we're going after. So beyond an amazing investment thesis uh behind it and being able to uh uh make sure that it's Genius Act compliant, we also really focus on the functionality of this product. So, meaning you can access it on chain, you can now um do subscriptions and redemptions 24-7. It's available on eight chains. You can also access it via whether it's APIs, a web portal, a mobile app, or on receipt, which is a QR code that you can just submit to a deposit address, and you're able to subscribe whether it's in stable coins or in fiat. So we've really focused on an easy user experience beyond it being a great product. We also made sure that it's easy to access, it's available for retail and institutional investors, the minimum's a dollar. We don't charge stablecoin burn fees, really make it the best possible product that people are going to want to use. And whether you're a retail user and it's a great way as a cash alternative, and I'd love for Jeremy to talk about this about how it's a different, it's a much better bank account. Like, why do you have any money in banks? You should absolutely have this invested in a money market fund. Or whether it's a small business that is frankly unbanked and they have cash and treasury management needs, they need to pay uh a vendor across a border and there's significant fees associated with that. Why not get into this product, earn some yield, and then be able to continue to work with stable coins or invest in crypto, or it can be used as collateral on trading platforms. Just the use cases are really exponential for both retail and institutional investors. And we've been really focused on growing this segment, as you've noted over the last year. And I think that will just continue to grow as you think about treasury integrations, you think about fintech workflows. We've had a few announcements on um partnerships that we've had to distribute these internationally. Um, it's really just endless in terms of what it could be. So focusing on that, and that is really the cornerstone. And then from there, having this SEC exemptive relief of 24-7 trading means that we can then build off of that for liquidity of other products. So our other 15 products that are floating navs, we can start to think about how those trade 24-7. So it's very much a building block to the future. Um, but I'd love for Jared to also comment on the bank account side and how it's just a great investing vehicle too.

SPEAKER_02 13:31

Well, Frank also talked about sort of the back-end infrastructure in our direct-to-consumer app, that Wisdom Tree Prime, you know, the the blockchain in some ways, I mean, the transfer in and out with some of these new chains that Meredith's talking about, that you there you know you're plugged into the into the uh sort of blockchain world. But in other ways, like you said, it's just infrastructure. Like if you're just using it as a consumer, you in some ways you wouldn't know, you know, that unless you're trying to transfer things out of the wallet and onto your own sort of self-custody wallet, you know, in some ways it's just a functioning app that has this nice technology behind it. But in people's traditional bank accounts, the banks earn their money by keep you keeping a checking account, them not paying you any fees. Now there's trillions of dollars of people. I don't know the exact number, but I'm guessing it's five trillion plus in bank accounts earning nothing. And so you have you know Trump talking about these stable coins and the rewards and all the rest, but you know, it is definitely a disruptive force to banks, as we talked about in the starting question. Like, why should you do banking nine to five, five days a week? Well, also, why should you be not earning three and a half percent on your checking account? So that is very, very disruptive, and people have a lot of inertia, like it's you know, tough to change your banks, change your bill pays, and all this stuff. But three and a half percent better is pretty motivating in in my in my view, and uh, you know, that you can pay all your bills from basically you get you you put in the ACH, it deducts from the money market fund right away, and you pay your bill, and it's seamless. And so I think it's uh a real strong anchor to everything else we're doing there.

SPEAKER_03 15:09

Yeah, and it it reminds me of something, uh a common saying that I hear, which is you know, good money eventually pushes out bad money. And this is almost uh a new default or new building block uh that people can use in a much more accessible way, uh, much fairer in terms of you know how much of the uh yield from that money can actually go back to consumers. Uh and now, you know, Meredith, as you were saying, uh it's really reaching a different audience um just by being this sort of cash default on-chain. Um I'd love to hear a bit about uh the use cases that you're seeing. You know, I've heard that WTGXX is being used for uh corporate treasury sweeps as a treasury management tool. It's being used by uh blockchain-based businesses that I know of, like Plume and Toku, uh, as a way of paying their employees. Uh, we'll love to hear a bit about how those kinds of developments actually happened. Was it you know inbound to you? Was it you outbound to them? Uh, and what was the case that you made uh with them around driving growth and demand for uh WTGX?

SPEAKER_00 16:28

Sure. And we're very focused on building this network effect because we think that that is also a huge part of this is that how do you not just offer products, but integrate them into existing workflows to make a better investing experience. So just like what Jeremy was saying with Wisdom Tree Prime, our money market fund is a better short-term and long-term investing product than a checking or a savings account. You're going to earn more, you're going to get that yield. That's going to be a better investing product in the long run for our end investors. So that is similar to the use cases on the institutional side, where you mentioned for corporate cash management. So we partnered with a firm called Stable C where it's small to mid-sized businesses, sign up. Also to Jeremy's point, they don't even need to manage their own wallet. They don't need to know it's on blockchain, but they need to pay a vendor in Brazil. They're a US-based company. They come in, they're able to deposit cash through any bank that they want. So they wire in cash, and then they can buy our money market fund, earn that 3.5% when they need to redeem it to pay a vendor. Then that is redeemed into USDC, and then that USDC pays the vendor. But from the small to mid-sized business, they're getting access to institutional grade products and the yield associated with it. And it's an easier, faster, cheaper way to pay their vendors internationally. So what a great use case for truly revolutionizing treasury management for especially these smaller businesses that may be own banked by the larger ones, or maybe just don't have the optionality to have a commercial banker, or they're really starting out and they need low minimums, which is also where our product is unique because the minimum's a dollar. So even if you have $5,000 starting out as a small business, you would be able to use this platform. So I love that one as a use case. I think that's really interesting. The other one for Plume and Toku, this is payroll, which I also think is really neat. Um, you could also do auto-invest through Prime as wasn't true prime, as Jeremy mentioned, but this one integrates uh Toku directly and integrates with ADP as an example. So an employer, Plume, which is also a blockchain that we mint onto as an employer, can buy our money market fund to pay their employee, part of their employees' salaries. They hold the money market fund for a certain amount of time. They earn the yield for that. And then the minute that it's payday, they transfer, so peer-to-peer transfer, those money market fund tokens to their employees' wallets who start earning that yield instantly because we have continuous block-by-block interest accruals. And then you're automatically investing from the minute that your paycheck hits your wallet. So another just great advancement as you think about a better investing experience using this technology, not terribly complicated, but really impactful to that end investor and to that end consumer. So those are two. We also are, I mentioned collateral as well for use cases to be able to post for trades. Um, and then a lot also just in cash and reserve management for stablecoin issuers for blockchain treasuries, um, so much of especially this technology is not needing to go off-chain, not needing to take your stable coins, sell out, go into a brokerage account, then purchase the assets. That's time and time is money here. So being able to make that really accessible and easy has been a real focus for us.

SPEAKER_03 20:11

I'd love to take the conversation uh beyond um, I would say, where the majority of tokenization activity is happening today. You know, I think when you look at the market, a lot of it is around stable coins, treasuries, money markets. Uh, but when you look at what Wisdom Tree is doing with uh the EPXC, uh, the equity premium income uh digital fund, uh it seems like you're going beyond some of those basic strategies and talking about uh options uh related um uh tactics and portfolios. Uh we'll love to hear how you see the the path for tokenization developing. Uh, Jeremy, you know, you you've seen Wisdom Tree play across um so many different kinds of asset classes. Um, how do you see the product roadmap uh evolving as you move up the risk curve or into different types of products that get tokenized? And where do you think tokenization is going to add uh genuine uh uh alpha for the end investor?

SPEAKER_02 21:20

Yeah, I well, I think I I mentioned we started the whole move towards totalization to saying like what could do to ETS, what ETF did to mutual funds. And so that there's elements again of this tokenization, like what Meredith said, you know, the first view on ETS was it democratized, you know, the the gatekeepers in some ways. If you were on a if you had a broker's account, you could buy the ETF. Here now, if you have a smartphone, you could buy the token. So some of it is access and different distribution mechanisms, like like we've talked about so far. It is a wrapper. So the wrapper, in some ways, anything you could do in traditional asset management, you could do in token forms. But the question becomes what is the most interesting strategy? People want. So in some ways it does rhyme with the ETF world. So, like what are people doing in thematics or broad betas, different exposures. So some of it's bringing ETFs online so that people can get access to it. You know, there's a community of people who like operating online, and more and more are coming that way. But sort of servicing the community for things they've they've looked at. Now, a lot of the original crypto digital asset people have looked for income and sort of these more stable assets, which I think is why you see a heavy emphasis on income. And so I think, you know, one of the most popular growth areas in ETF world has been derivatives, option income, uh covered calls, or protective strategies. And so we we and we actually just acquired a firm in Europe called Atlantic House that has about 5 billion in derivatives. So you're going to see us do a lot more in derivatives as a firm, both in ETF world and I'm sure eventually in in token world. Um, you know, but we're trying to get more innovative really in ETFs into alternatives and and other things. A lot of people were putting like complex things, like I'm gonna buy a real estate building, I'm gonna tokenize it, or I'm gonna do art and tokenize it. Like we went to the most mainstream competitive liquid assets, treasuries, the entire treasury curve from tips to the one year to the 10-year, you know, the money market fund. We did broad equity betas like our own version of the SP 500, like a version of the the sort of leading tech companies. We have we started with Professor Siegel. We have a suite of Siegel-oriented asset allocation funds. So I think it's just really taking our best investment ideas and eventually bringing them to the token world. We could stand up these things quickly if the people do have desires for strategies in token form. Um, but yeah, we do we do think of it as putting our best investment ideas out in that in that format.

SPEAKER_03 23:51

Do you see the ability to to issue and rebalance on-chain actually starting to become part of the mindset of wisdom tree uh product strategists? You know, are people within the firm actually thinking about, hey, what is newly possible now that we have tokenization as another lever, another wrapper, um, that you know, we wouldn't be able to do off-chain.

SPEAKER_02 24:16

Yeah. And like at some point, you would say, hey, again, the 24-7 trading, you have weekend trading, you could actually start buying things that are trading over the weekends as our gold token is trading um over the weekend. You can see that being one of the things that in an asset allocation fund, you'd be able to make adjustments if you had desire, something happened over the week and you said we need to adjust portfolios. So there's definitely possibilities to do that. I think we're so far doing, I think, mainstream betas, whether it's gold, whether it's the the option income fund that we have, or the other things that you're not necessarily need to trade on the blockchain, but I do think that is part of the future worldview.

SPEAKER_00 24:56

And a lot of what we've also been working on is related to vaults as well, where different vault managers would be able to access our products and then pretty much build custom portfolios and also are in early conversations with a few wealth platforms too that were historically crypto focused, but now want to be able to access tokenized real world assets to build that diversified holistic portfolio so that you don't need to manage two separate portfolios for a client. All of that value is just on-chain and you're able to rebalance it. Um, so I do think that that is coming. We did a proof of concept, now it's four years ago with um JP Morgan and Apollo, where using smart contracts, we rebalanced 3,000 uh model portfolios with three clicks. And it has still taken a bit of time for the rest of the market to catch up to that, I think, as it goes into production. But I think now wealth managers, but also these vault curators are starting to see this is how you can truly create unique uh model portfolios similar to what we do in the traditional side, but also including these assets and getting that programmability, the scalability, but also the 24-7 access that Jeremy mentioned.

unknown 26:14

Yeah.

SPEAKER_03 26:14

Yeah, I'm excited to see that um really come to market. And um, you know, I've always been curious, you know, with every institution, it is a unique uh battle to try to get people bought in on blockchain. Uh so Jeremy Meredith, curious what that uh experience was like uh many years ago when um you really first started pushing and championing um blockchain as a priority for the firm.

SPEAKER_02 26:45

Today we're we have 160, 170 billion in total assets, but 40 billion of that's in commodities with a very healthy amount of that in gold. And so you know a lot of the narrative on for Bitcoin was is it digital gold? And you know, we hate that term because we actually have tokenized gold. Like we actually had digital gold in Wisdom Tree, you know, prime. But that but that the use case for Bitcoin is like gold, that there's a fixed amount. Um, you can argue Bitcoin has even better features in that than gold because hey, we're mining gold all the time and we're not really creating new Bitcoins. So I we for that reason alone, we we given we have such a strength in commodities, that was another reason why we had to start focusing on the crypto assets itself. Back, you know, we we had no choice. Like we we are a player in gold. We had to be a uh a big uh had to be a big part of our focus at focusing on Bitcoin itself, but also then now the whole blockchain technology. So I think it was really just looking at not being afraid of disruption risk, but then also, you know, not having that large, stable banking clients, I think freed us to think much more creatively.

SPEAKER_00 27:49

And we've also been able to build our own technology as well. And and Jeremy's mentioned this, having support from our CEO and founder, Jonathan Steinberg, has also really aided us in that. And we are a firm of firsts, and he's a pioneer. So having that mindset and that mentality that's very entrepreneurial has also been very additive to us because having our own technology, we do our own tokenization, we're our own transfer agent, we do our own stable coin conversion, we're our own broker dealer, we have our trust company, means that we can also be really nimble and move really fast. So when a client comes to us and says, I've mentioned this before, I want to set up an auto cash sweep. Can you set up deposit addresses so that we can just send USDC to a deposit address and get back money market fund tokens? We said, not a problem, give us three weeks. And then we launched it. And now it's a main driver of a lot of the crypto native activity that we have because it's so easy to use. So us also having that ability and the bandwidth to really be tech first has enabled us to not only just disrupt ourselves, but also really expand on what the vision could potentially be for what programmable money means, using the roots of what we have and all the expertise on the investment side to make really, really good products that then also work really, really well with this technology.

SPEAKER_03 29:11

You know, in two years from now, uh, what do you think the wisdom tree footprint looks like uh when it comes to on-chain markets? You know, the the level of AUM, the types of products, the types of clients. Um, you know, how do you see that playing out um over the next two years?

SPEAKER_00 29:31

So it's it's interesting. If you look at the graph of ETF AUM, it was slow at a start and then it hockey sticked up. And I feel like that's where we are with tokenized RWAs as well. You mentioned the growth that we've had over the last 13 months. It's been exponential. And there is just more and more demand coming. So I think looking two years from now, um, I mean, I hope that we're here and it's the largest money market fund that we and the largest product that Wisdom Tree has. So over $15 billion is what we're pushing for, maybe even more for the total business. But I also think that what we're building over the next eight to 10 months is around liquidity, but also focus on identity. And what I mean by that is having 24-7 availability for our products, ensuring that they can be bought and sold globally and also in many different time zones is important to create that liquidity. But then also who we can onboard, the scale and the quickness that we can onboard the masses is also what we're really focused on too, because you can have wonderful products and have a great tech setup. But if you can't onboard the users as fast as you'd like, then you could miss the opportunity. So we're really focused on those two elements, um, still doing all of that within our regulatory framework of being based out of the US and the structures that we have. But I think we're gonna solve those two, and then that's going to lead to a lot of growth for us in the future, and we'll continue to launch new products that are again meeting the specific needs of this client base that is both retail and institutional. But at the end of the day, while they're very, very different, in many cases, they are looking, as we all do, for security, relate regulated assets, understanding what you're buying and what you're owning, but also getting yield, having it be a good investment thesis, and being able to ensure that your money is safe at the end of the day, but also having those opportunities to take some risks and get into the market. So all of those principles are true. Um, and so we're gonna continue to build off of those and really increase the demand for what we have.

SPEAKER_02 31:45

It's a big goal for Meredith putting out there, it's going from, you know, it's a little bit under a billion to uh top funded 20 billion, let's call it 17 billion.

SPEAKER_00 31:54

So you just added some on. Okay, so there you go.

SPEAKER_02 31:57

17 and a half is our top today. So it's it's she's got a big goal, but I uh for sure it's hitting product market fit. And if we could keep, I think focus you focus on the real strengths and sort of doing payments from these yield earning assets is a huge strength. And and so I think um you know, for getting people to onboard and fit figuring out distribution is the because again, we don't have that installed client base like a big bank, but we, you know, it's it's de novo, and yet getting people comfortable with that, onboarding a bunch more people to do the bill pay stuff like that, I think that's such an exciting thing. Um, very basic, very exciting, um of how broad it can really be.

SPEAKER_03 32:39

You know, here I'd love to jump into uh our lightning round questions. Uh, two things that I love to ask all of our guests. Uh first, um, one that I call rookie mistakes. Uh, you know, many people come to blockchain from uh different parts of their journey. Uh, and you know, we've all had to start somewhere. I'd love to hear uh maybe a rookie mistake or initial misunderstanding that you had early on around blockchain tokenization, crypto, uh, and uh you know how how you navigated that.

SPEAKER_00 33:15

So I'll start with one that um it's more about the industry generally, in that crypto is pseudo-anonymous, and yet trust is paramount. And I think now, even more and more, people want to know who they're working with. People want to trust in what products they're holding, who is the owner of them, how does it work? Um, so I think that was something that I was not expecting going full-time into crypto, coming from a very traditional background, was that element of trust of knowing who you're working with is still, and I think maybe even more so now in crypto incredibly, incredibly important. And I will say, four years ago, no one was asking me about our bankruptcy remote structure if we had a trust board. Can you send me detailed holdings? You're a publicly traded company. This is great. I I can put a face to a name. And now that is almost every question that I get when I'm talking about our product. So there's been a shift, maybe a bit of a um a few more grown-ups, attritional finance people uh also into the space, or maybe people just got a bit burnt. But um, I think that element of trust is still really important. And that surprised me coming um to work here full time.

SPEAKER_03 34:28

The second uh lightning round question, uh, I call it uh pleasant surprises. Uh so you know, what's something that uh was a pleasant surprise, uh, some kind of win or something that worked uh better than expected when it came to implementing blockchain, exploring tokenization, and and launching um uh some of Wisdom Tree's uh initiatives.

SPEAKER_02 34:52

I'll say one thing that was surprising is and we haven't really talked about, we've focused on sort of the Meredith business, the tokenization effort. Usually you don't think of Europe as leading regulatory, like there's like you innovate in the US, you know, like in in China they copy and in Europe they regulate. Like that's sort of like the the the reputation. Um, but Europe allowed sort of crypto-focused ETFs years ahead of the US. And so for our business, um, in terms of actually saying Bitcoin and Ether and Solana and and and sort of the crypto tokens in ETF form, uh, are European teams leading the US team, and and we're able to do it like five years ahead of the US. And so it's it is interesting. We have more exposure in our European crypto, more energy in in that in that area, interestingly. Um, and so I don't think often that is Europe leading, but they they sort of were a little bit ahead of the US on just allowing more creativity, very interestingly, and still even in the market more than the US has. So the US is playing cash up a little bit, and it's good to see some of the new regulatory focus in trying to be more pro-crypto innovation. Um, but uh that was a big surprise.

SPEAKER_03 36:08

Yeah, that's such a good point. Uh I hadn't thought about that that much, but you're right, you know, CoinShares and other companies in the European market that were putting out ETP products, um, you know, they they actually were, yeah, pioneers ahead of the US, um, which is funny to say. But uh Meredith, how about you?

SPEAKER_00 36:26

I would say from my side on this, probably shouldn't be a surprise, but um, really being more tech forward and really leaning into that really early on. I mean, we were early in a lot of this. We've built a lot ourselves. People would say, you're crazy, we can do this for you. And that actually has really been a great opportunity for us to be more nimble and to win more business. And also just to be more integrated and we understand what our clients are going through, we understand what they're building on. Um, and I think that has really paid dividends in a lot of different ways for us. So I think um, not like it should be a surprise, but just really being integrated into the ecosystem has really led us to be successful here. And um, I also think being able to do a lot of education around it and help others understand why this is going to change the way that assets move and that programmable money is very, very different from what it is has been um a differentiator.

SPEAKER_03 37:28

I love that. Yeah, I think being able to build your own stack, own your destiny. Um, it's very underrated and seems like Wisdom Tree has done a great job at that. Um, Meredith, Jeremy, thank you so much for joining us. Uh, it's been a really fun conversation. I'm super excited to see where Wisdom Tree goes from here uh with tokenization and blockchain, digital assets. Uh, look forward to staying in touch on all of that and uh uh hopefully supporting however we can from Pantera.