On The Brink with Castle Island

Latest Episodes:

James Davolos (Horizon Kinetics) on Betting on Inflation (EP.199) Mar 29, 2021

Show notes

James Davolos, VP and portfolio manager at Horizon Kinetics, joins the show to make the case for inflation and to explain their Inflation Beneficiaries ETF, ticker $INFL. In this episode:

How Horizon and Murray Stahl were one of the earliest asset managers to put client assets in GBTC
How Horizon's value approach landed them at a Bitcoin allocation James' reaction when Horizon first made the Bitcoin allocation
Whether Bitcoin is a growth or a value asset, and how to reason about it from either perspective
James' reaction to Jerome Powell's announcement on rates
The genesis of the idea to create an inflation beneficiaries ETF
James' case for inflation
Should the disinflationists be taking victory laps?
Why the Fed is calling inflation 'transitory'
Why we didn't get inflation from 2010-20
What crystallized the case for inflation for Horizon Kinetics?
The importance of the 'taper tantrum'
Why historical parallels are so hard to find – and why we have no historical precedent for our current moment
How the dollar is the 'least rotten apple'
The prospects for a non-dollar monetary system
The effect of ESG on commodity cycles
How fiscal spending and the political anti-capital movement represents a structural shift
The constant battle between capital and labor
Why equities may suffer from higher labor costs
Why Horizon focuses on asset light companies
James' answer to the equity-inflation return puzzle
Horizon's specific allocations to benefit from inflation
The early success of the Inflation Beneficiaries ETF
Why the inflation beneficiaries ETF does not contain Bitcoin
How this ETF sets itself apart from other ways to play inflation – and why TIPS aren't the best bet
Is the thesis playing out so far?
Why the Fed has to remain subtle with their debasement
James' pitch to Bitcoiners

Weekly Roundup 03/26/21 (The most violent people on earth, Fidelity's Wise Origin ETF, can GBTC be saved?) (EP.198) Mar 26, 2021

Show notes

Nic and Matt are back for another blockbuster week. In this episode:

How Nic ended up being labeled the most violent person on Earth
Fidelity files for their Wise Origin Bitcoin ETF
The significance of Fidelity's filing today
Can the GBTC product actually be redeemed by a majority of shareholders?
Amendments to the GBTC charter
Odds of the SEC finally seeing the light on the ETF
Why an ETF approval is more urgent than ever
The toppiest top signal ever making us nervous
FATF is back with a vengeance
Jack Dorsey includes a Blockclock in his Congressional testimony
Is Bitcoin a battery?

Content mentioned:

Peter Johnson, Crypto Credit Market Breakdown
Nic Carter, The Frustrating, Maddening, All-Consuming Bitcoin Energy Debate
Nick Grossman, Bitcoin as a Battery

This episode is brought to you by Sovryn, DeFi on Bitcoin.

Dan Tapiero (10T Holdings) on Macro, Crypto and Growth Equity (EP.197) Mar 24, 2021

Show notes

Dan Tapiero, the Managing Partner or 10T Holdings joins the show. In this episode we discuss:

Dan's pre-crypto career as a macro manager and entrepreneur and the path that led him to founding 10T Holdings
The institutional narrative for Bitcoin and cryptoassets and how this thesis interplays with gold
Views on layer one smart contract platforms and how to think about value accrual on these networks
How Dan is approaching growth stage opportunities in this industry

To learn more about 10T visit: 10tfund.com

Follow Dan on Twitter @DTAPCAP

Michael Greenwald (Tiedemann Advisors) on the Dollar as a Policy Tool (EP.196) Mar 22, 2021

Show notes

Michael Greenwald is a former U.S. Treasury official with expertise in sanctions programs and using USD infrastructure to promote policy objectives. In this episode:

What the weaponization of the dollar really means
How sanctions mechanically work
How Treasury and the State Dept carry out sanctions
The risk of sanctions wearing blunt as a tool
The growth of sanctions post 9/11
How sanctions against Russia represented a sea change in policy
How the US deputizes SWIFT for sanctions
How and why Europeans tried to route around US sanctions on Iran
Is the US led international order fraying?
China's attempt to build a parallel financial infrastructure to challenge the dollar
The objectives of the Belt and Road Initiative
The purpose of the digital yuan
Can the yuan challenge the primacy of the dollar in the international system?
How China uses the belt and road initiative to advance the yuan
How the US should react to China's aggressive move into closer economic relationships with the third world
What a digital US dollar or CBDC might look like
How the US can reassert dominance in the international sphere
Michael's thoughts on stablecoins and Bitcoin

Read Michael's paper, The Future of the US Dollar

Sponsor notes: Copper is transforming how institutional investors engage with digital assets by developing award-winning custody and next-gen trading infrastructure. Headquartered in London, the firm is scaling rapidly across Asia and North America to bring its suite of products to a wider pool of institutional investors. To learn more visit copper.co or reach out on Twitter, @CopperHQ

Weekly Roundup 03/19/21 (NYDIG's rumor, NFT taxonomies, BoFa's bad Bitcoin report) (EP.195) Mar 19, 2021

Show notes

Nic and Matt return for another week of deals and news. In this episode:

We announce onthebrink.shop
What was Robby Gutmann from NYDIG rumoring on our recent episode?
Morgan Stanley opens up their platform to Bitcoin funds
A new taxonomy for NFTs
Bridging the gap between NFT fans and skeptics
Why NFTs are not bearer assets and are liabilities of an issuer
We break down a popular thread debunking NFTs
Bitmex Research publishes a book on the blocksize war
BoFa publishes a very bad report on Bitcoin
India dithers on their cryptocurrency ban
The parallels between the crypto wars of the 90s and state bans today
Is there a double standard for Bitcoin versus other ETFs at the SEC?
Is Gensler a grey swan for crypto markets?
The SEC is officially on the clock for a new ETF application
Why FTX should not buy the naming rights to the Miami Heat stadium

Content referenced in this episode:

Nic Carter on Medium, Why NFTs are Hard to Explain
Twitter thread on NFTs by Jonty
BitMEX Research publishes 'The Blocksize War'
SEC Comissioner Hester Pierce's speech, Paper, Plastic, Peer to Peer

This episode is brought to you by Sovryn, DeFi on Bitcoin.

Dennison Bertram and Raf Solari on Reforming DeFi Governance (EP.194) Mar 18, 2021

Show notes

Dennison Bertram and Raf Solari, the founders of Tally join the show. In this episode we discuss:

Dennison and Raf's career journeys into crypto and to founding Tally
The current state of DeFi and how they think about an emerging taxonomy of projects
Views on how voting and user interaction with DeFi protocols are evolving
Comparison to legacy financial services like proxy voting
How Tally is engaging with open-source communities to promote user engagement

To learn more about Tally visit www.withtally.com

Robby Gutmann (NYDIG) on the Institutionalization of Bitcoin (EP.193) Mar 15, 2021

Show notes

Robby Gutmann, CEO and Co-founder of NYDIG, and Co-founder of Stone Ridge, joins the show to talk about his firm's Bitcoin and digital asset ambitions. In this episode:

The origins of NYDIG and Stone Ridge
NYDIG's product suite and differentiation
NYDIG's deliberate pro-Bitcoin stance
Why Bitcoin is such a compelling opportunity to Robby
Bitcoin's pace of development
How much attention NYDIG pays to core development
Is there a contradiction between open source money and institutionalization?
What explains client enthusiasm for Bitcoin in 2021

Weekly Roundup 03/11/21 (GBTC redemption scenarios, Norwegian energy in Bitcoin, the NFT missing link) (EP.192) Mar 12, 2021

Show notes

Nic and Matt return for another intense week of deals. In this episode:

New Bitcoin FUD dice?
Is there any new Bitcoin FUD?
Beeple sells an NFT for $69m
Are NFTs art or the autograph?
The missing link for NFTs – where do you show off your NFTs and demonstrate status?
One issue with NFTs and IP
Is NY Life getting into crypto?
Norwegian oil billionaire embraces Bitcoin
DCG buys back GBTC to bring it back to NAV
Scenarios for how GBTC redemption occurs
Why GBTC trading at a discount is better for retail investors
Moneygram and Ripple are no longer partners
Grayscale hires an entire ETF team
Should the US start a strategic Bitcoin reserve?
Why Bitcoin makes sense for central banks
Why CBDCs will never provide real cash-like assurances

Content mentioned:

Aker Shareholder Letter

This episode is brought to you by Sovryn, DeFi on Bitcoin.

Zac Prince (BlockFi) on the Series D raise and a market update (EP.191) Mar 11, 2021

Show notes

Zac Prince, CEO and Cofounder of BlockFi joins the show once again to discuss BlockFi's newly announced Series D financing and to discuss market dynamics. In this episode:

Announcing the Series D round of financing
Growth of revenues and clients on the platform
How BlockFi classifies itself in the taxonomy of banking, fintech, and brokerage
Market worries around the GBTC discount
Why did GBTC flip to being discounted?
What the GBTC discount means for BlockFi
How do the current GBTC dynamics affect Bitcoin interest rates, if at all?
One unexpected way the GBTC discount could disappear
The prospects for "busting the trust"
How Zac thinks about public messaging and the Twitter environment
What fraction of the bitcoin interest rate the GBTC trade represents
What's next for BlockFi

Prior BlockFi OTB episodes:

Matthew Le Merle on technology trends and the cryptoasset markets (EP.190) Mar 10, 2021

Show notes

Matthew Le Merle, Co-Founder and Managing Partner of Fifth Era and Blockchain Coinvestors joins the show. In this episode we discuss:

Matthew's views on The Rise of Generation C and some of the trends he foresaw ten years ago
Views on the GameStop / WSB saga and what this portends for the financial markets in the years to come
The state of the cryptoasset market and the infrastructure that is being deployed in 2021
How he thinks about approaching this industry as a leading fund of funds

Learn more about Blockchain Coinvestors at their website and follow Matthew on Twitter @mlemerle

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