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The Good, The Bad, And The Ugly - Silicon Valley Bank Gets Stampeded, & Web3 Begins To Go Mainstream
Episode 413th March 2023 • Fintech Confidential • DD3, Media
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Join Tedd Huff of Fintech Confidential and Bruce Burke of Bullet Point Bulletins as they discuss the latest developments in the world of fintech and web3 technology on this week's episode of the Weekly Wrap-Up of Bullet Point Bulletins.

The FDIC seized control of Silicon Valley Bank and the future seemed very dismal, but following this episode later that evening the Wall Street Journal said the U.S. Treasury, Federal Reserve and the made a joint decision to make good on all deposits made. This was basically decided upon to restore the public’s faith in the banking system in the U.S.


Tedd and Bruce discuss the many implications that surrounded the weekend-long banking crisis. The Feds hands seemed tied in this decision. Not stemming this tsunami would have lead to much deeper and long term problems.


Inflation, mistrust, collapses and cryptocurrency are all playing hell with the economy and financial systems. People are beginning to look to alternatives to keep their hard earned money safe. There are many different aspects of the monetary systems and the startup scene in the valley discussed, but ultimately the government had to save it or else the contagion could have had a huge domino effect across the world - from the 16th largest bank in the United States.


Oh and Bruce and Tedd also talk about the mainstream adoption of NFT’s from both Starbucks customers and a forthcoming announcement expected from Amazon this month about a Digital Marketplace. We also discuss how the new Coinbase Wallet-as-a-Service is also bringing customers easily onboard to apps like Floor, and Token Proof.


It seems there is a lot of simplifying of Web3 standards, but at the same time kind of making them a hybrid Web2.5. At least it’s a step in the right direction. Or is it? Will the interoperability of Web3 ever be realized, it seems each new project has a proprietary blockchain, token or wallet technology of its own.


Will the Web3 ideals be discarded and replaced by Web2 standards - or will the utopian ideals be upheld by the devout and the Web2.5 projects shunned by the true believers in the real Web3?

Also, watch the entire episode on youtube.

https://youtu.be/hF48IJCtk-I

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This is a Production of Diamond D3, Media

ABOUT:

Tedd Huff: President & Founder of Diamond D3, a professional services consulting firm focused on global payments and marketing. He is also a video podcast host and producer of Fintech Confidential and Head of Corporate Strategy at Corvia. 

Over the past 24 years, he has contributed to FinTech startups as an Advisory Board Member, Co-Founder, and Chief Experience Officer, providing strategic and tactical direction for Global Payments OpenEdge, Heartland Payments, Nuvei, and TSYS, among others, focusing on growth while delivering innovation, process improvements and user experience-driven value to simplify the complexity of payments.

Diamond D3, Media: A media creation, management, and production company delivering engaging content globally

Transcripts

burke]:

Ello, I'm Bruce Burg, Welcome to the Bullet Point Bulletins weekly. Wrap up for the week of March twelfth, twenty

burke]:

twenty three. I'm here with my good friend and co host Ted Huff of Fintec Confidential. Now I'm going to send

burke]:

it over to Ted so he can please share with everyone the new stories will be discussing today, Ted.

confidential]:

So today we're going to be just covering a handful of things. This week has just been bankers

confidential]:

with some of the news, but we're going to start off with a couple really happy stuff, so

confidential]:

we're gonna be talking about how there are rumors that Amazon is going to launch an n f t

confidential]:

Market Place project in the next month or so, with about fifteen collections. The other thing

confidential]:

we're going to cover is coin bases, new wallet That makes Web three integrations easier than

confidential]:

ever, and we can Go this week's episode without talking about the S v B Sunami that has hit this

confidential]:

week. So there's so much to talk about with the S v B thing. But let's dive first into the

confidential]:

Amazon and F. Ts.

burke]:

Yes, it's it's it was bound to happen. I mean, by starting to do him, it seems like even thou, the journalist

burke]:

and the media have all pronounced N f T is as a thing of a past and something that nobody cares about any more,

burke]:

and a flash in the pan that n f t s continue to grow. And it's not just about a board ape any more, it's about

burke]:

a lot of different things. According to the article I read, they're going to be issuing uh digital tokens along with,

burke]:

like say, a few bought a pair of genes very similar to the company we talked about a few years few few weeks ago

burke]:

that was issuing the clothing with the digital tokens

confidential]:

Oh yeah, the one that J Z is supporting. Yeah, yeah, yeah,

burke]:

Exactly exactly exactly.

confidential]:

So I think it was also interesting. You know. what's this? Is going to supposedly be launched to

confidential]:

us customers first, and then gradually get rolled out to everybody else. Um, starting with

confidential]:

fifteen n f T collections is actually a bit underwhelming for such a company like Amazon.

confidential]:

And you know you're going to be able to buy these just with your pay with Amazon. so they've

confidential]:

really reduced The overhead or the confusion that comes when you're You're doing the web

confidential]:

three on ramp. Um, and what I read also is that this was supposed to go last year, but F

confidential]:

t x. You know that whole thing. We'll talk more about that later, but f t X collapse caused them

confidential]:

to delay it a little bit. But you know one of the things that I've been thinking about

confidential]:

and talking about, and I read another article about this as well Is when I start thinking about

confidential]:

how block chain could be used from an Amazon perspective, somebody else came up with this idea

confidential]:

as well, So obviously I'm not the only one thinking about it. But if you're using block

confidential]:

chain to track to manage the delivery of products, verification that you actually got the

confidential]:

product verification that the product is actually the product you received. There's so

confidential]:

much stuff that you can do with these n f Ts and the smart contracts Along with it. and

confidential]:

if you're leveraging the delivery truck as another part of the smart contract, and the address

confidential]:

you're getting it delivered to as another part of the smart contract. I can really see how

confidential]:

how they're going to leverage these n f ts as a way to reduce the consumer fraud of I didn't

confidential]:

get my package or I didn't do this, or hey, Product I received isn't the product that was

confidential]:

shipped. I'm really starting to see that how this will tie into the supply chain and really

confidential]:

reduce their losses around these types of goods. Now, I know that's not what they're talking

confidential]:

about here. This is more of the artistic side of the house, but I can see us moving over

confidential]:

to that. Especially You know they're They're going to be leveraging chain link for the node

confidential]:

creation, so I just I see so much more going into this beyond the games beyond The collectibles

confidential]:

beyond all that offense.

burke]:

There seems to be a common thread happening of like you said, trying to get rid of those hurdles and obstacles

burke]:

for the average consumer to engage in the n f T market right, Starbuck's

confidential]:

Hm.

burke]:

launched a new U n f T this week. And you know because I'm part of the

confidential]:

Did

burke]:

auto

confidential]:

I

burke]:

C

confidential]:

miss

burke]:

program

confidential]:

that

burke]:

right, They set me a thing like two days ahead of time Like Hey, you know, let us tell you how to get ready

burke]:

for when we dropped these n f ts. Go ahead and put your credit card here right, and set up your credit card

burke]:

and set your alarm for this time and I did. And and guess what they sold out of what? Two thousand n f Ts, and

burke]:

like twenty minutes out of hundred dollars a pop using ordinary credit card purchases, Uh,

confidential]:

They're just

burke]:

And

confidential]:

doing it

burke]:

and

confidential]:

on ramp.

burke]:

this also leads right into the know, the coin base thing of. Let's make it easier for people to get on board right.

burke]:

Let's let's remove the obstacles. Let's remove the hurdles and less. Uh, let's make it so Grandma can join Right

burke]:

and Grandma can get it right.

confidential]:

Well, I mean with with coin base in their new A P. I. Really, what they're calling it? Wallet

confidential]:

as a service. So while it is, the service is what they're calling it. And this is kind

confidential]:

of what we've been talking about. The inner operability. It still drives me nuts. That is

confidential]:

centralized on coin base, but it is. it is offering a first step into interoperability

confidential]:

across multiple different projects across multiple different Solutions, So I'm not not

confidential]:

a huge fan of it being centralized, but I think it's headed in the right direction.

burke]:

Well, the interesting thing to me, on the V P of Engineering, his name is Danger, Will Robinson, Danger, Will

burke]:

Robinson,

confidential]:

Yeah,

burke]:

And he's posing with the robot from Lost in space, but He's His comment is the same as My comment has been like

burke]:

all along. You know, this thing is all set up backwards when you want to go and engage with a brand, a web three brand.

burke]:

Let's call it that right, and you want to get into you know that their project or their you know, release, or whatever

burke]:

is going on,

confidential]:

Hm,

burke]:

you get there and they say, Oh, insert your wallet. Well, you don't have a wallet yet. Well, now you got to go in

burke]:

the wallet Right and then so so then you

confidential]:

Yeah,

burke]:

leave their spot right, and you go and set up your meta mask or whatever other wallet that you're going to set up,

burke]:

And now you got this whole thing and that kind of you know that set up and everything that you got to do your

burke]:

seed phrases. You gotta do this. You got to do that and then you got to find some way to store that thing and

burke]:

you know, kind of set it aside and set it somewhere where you're going to be. You know comfortable having it there,

burke]:

and then you have to go back And then you have to insert your wallet before you even

confidential]:

Hm,

burke]:

know what you're doing Really right. And I think like he said, that that flow is backwards and essentially like

burke]:

shopping carts. In the days of your people are abandon it right. They get there. They want to buy an ape. They

burke]:

want to you know. Participate in the project. They want to you know. Do something and it seems like too much and

burke]:

they just like you know, Forget it right and they Bandon the cart

confidential]:

Yeah,

burke]:

before they even put in a bennet. You know,

confidential]:

I mean, I get where you're coming from. I just I worry that we're just making a web. tue

confidential]:

point one, um, with these wallet as a service, because it's again is centralized. Where

confidential]:

S a meta mask is a decentralized wallet infrastructure. Um, and that is that is huge, And that's

confidential]:

really what the whole purpose of having these types of wallets are, And that's just one of

confidential]:

the concerns that I have. but Companies like Floor and Moon Ray and Third, Web and Token

confidential]:

Proof are saying Hey, this might be a quick way to help our customers. and and they're probably

confidential]:

doing it, as this is like a stop gap until we can figure out how to manage something fully

confidential]:

decentralized, So

burke]:

It's a simplified on boarding right. It's simplifying to, you know, getting a customer in

confidential]:

Yeah,

burke]:

Right, And that's number one right. I mean that's that's number one thing that every company should want. Let's

burke]:

let's make it as simple as possible for somebody to do business with us right. But

confidential]:

Hm,

burke]:

at the same time, how do you maintain that decentralized integrity? If that's a term right, I just made up a new term,

burke]:

Fred.

confidential]:

Yeah,

burke]:

It's It's decentralized integrity Right. But and you're Credit amongst your other web, three effecialanatos that

burke]:

you know, your project is sitting right alongside of right, So

confidential]:

Yeah,

burke]:

it's It's an interesting kind of ah h. positioning Also right. I mean, a lot of this is positioning and a lot of

burke]:

people I think are saying well, Web threes gonna be like this, But there's not really a whole lot of Web three

burke]:

yet. You know what I mean, You know.

confidential]:

Yeah,

burke]:

so it's

confidential]:

I guess I look at it. So do you understan, So what is your perspective on what this coin

confidential]:

base wallet is a service? What do you? What is your perspective of the problem that it's

confidential]:

solving?

burke]:

It's essentially helping the people that are writing to it and including that wallet a P. I in their code, a way to

burke]:

quickly get customers into their Echo system. But if they don't want to use a coin based wallet and they want to

burke]:

use another wallet, it's counter productive or if they have Another wallet, writ is counter productive, so I

burke]:

don't know if all the companies that are writing to the coin base a P. I, are only going to use the coin base

burke]:

wallet as a service, or if they're goin allowed to use of other wallets. That's something that the article really

burke]:

didn't reveal. I read quite a few different articles about it and none of them really talked a whole lot about how

burke]:

the companies are using, other than just simply writing to the A P To get customers on board right and make it

burke]:

simple for those customers to do business with him.

confidential]:

So When you, when you're having to go from, that's what you're you're you're talking about the

confidential]:

Starbuck experience Right? So you're in the Starbuck's experience and it says you need to

confidential]:

set up a wallet. right? Okay, So why is it having you go set up an a wallet? And and I guess

confidential]:

I kind of look at it, And you know if you look at Starbuck says you need to go set up a

confidential]:

wallet, Then you go to Meta Mass, And they have you set up your wallet, Then you have to

confidential]:

go back to Starbuck and then you have to tell Starbuck you're using Metamaskeand. you have

confidential]:

to validate and verify that Metamask has access to the star box. Then, like you see all these

confidential]:

back and forth what I see. This is what their attempt to do here is the biggest issue that

confidential]:

that block chain will be able to solve. And that's identity verification. Because, because

confidential]:

if I knew it was Bruce, and in Bruce's block, we knew that Bruce had interfaces with all

confidential]:

of these networks because of that block, And we can validate Bruce in that block and we

confidential]:

knew his Based on that. I can then just give my address to where I wanted to go, And that's

confidential]:

kind of how I'm looking at this. Is that the reason why this is so important? right? Ow.

confidential]:

it's because we don't have a unified identity verification process. We don't know it's Bruce

confidential]:

doing doing this and it hasn't even had to be Bruce. Just as like we don't know that it's blocked

confidential]:

one, two, three four, and I know it's not that way, but block one, two, three four has

confidential]:

been validated, so we can actually tie this this object to this, this validated block and

confidential]:

you can't do that, And that's the inter Ability that I keep talking about, and this is a short

confidential]:

cut to getting to that because what coin base is doing with their wallet as a service? Is there

confidential]:

validating the individuals identity or the identity of the receiver or the delivery person?

confidential]:

And so now you're just you're in identity verification and validationareas. So I'm I'm thinking

confidential]:

this is. That's why I'm calling it like a web to dot one, two, dot two, two, dot five. whatever

confidential]:

you want to call it, Because This is that stop gap until we figure out how to have an interoperable

confidential]:

verification of identity. And once we have that, then you can start to manage things

burke]:

In everything I've read about Web three Right, all the white papers. All you know, the big thing pieces that

burke]:

I've read about it. You know. the idea is the wallet that you're bringing to a web. Three property is not just a wallet

burke]:

for money. it's a wallet

confidential]:

No

burke]:

also, for you know, identification is bringing your creations with you. Not just your collection, right, but

burke]:

if you created something right, also Right, but it's also supposed to bring your friends your. your. you know

burke]:

everything right. You're essentially bringing your wallet in. You're plugging it into wherever you're visiting,

burke]:

Right and your stuff isn't already there. By putting in a user ide and past word, you're bringing all your stuff with

burke]:

you to that network and your plugging it in with the wallet. And nobody has that yet. The closest one I see that

burke]:

actually has that, and it seems to be work Towards that is Polly Gon with what we talked about last week with their

burke]:

zero knowledge proof wallet, Right and it's scalable apparently, but nobody. still. Everybody's got the you know there's

burke]:

there's. you know. We talked about at least a dozen wallets, and in the past couple of months, right, uh, they allow

burke]:

you to bring your n. f. T. S. They allow you to you know, hook up your accounts to him. You have some kind of

burke]:

identity. You can put up your p. f, P, right of your favorite n f, Right, Uh, and that's about where it stops

burke]:

and where it starts right. There's not much

confidential]:

And

burke]:

to it right And so

confidential]:

well,

burke]:

it's

confidential]:

and that P. P is just just a visual representation for people to quickly and easily verify

confidential]:

and validate the identification. I mean, there are so many different ways to do it. And what what

confidential]:

I want to to have everybody think about is This wallet right here is the most decentralized

confidential]:

wallet that you can have. Right

burke]:

Yes,

confidential]:

like it's not connected to anything. It's like it's not. There's no, like I don't have to

confidential]:

get permission. I don't to verify with anybody to pull driver's license. A credit card Money

confidential]:

out of her. I don't have to do that right. I can do it without asking for permission. Um,

confidential]:

and I think until we get to the point of of having a truly decentralized wallet where I don't

confidential]:

depend on anybody else other than myself,

burke]:

Yeah,

confidential]:

Um, it's going to be really hard to have the interopperability and that's why I think as

confidential]:

much as everybody laughs at me when I say this, I think having a hardware wallet is going

confidential]:

to be The key to success in identification verification. To be able to like you, Talk about

confidential]:

to take the stuff with you

burke]:

Yeah,

confidential]:

because these are bits and bites of data that we can

burke]:

And bring

confidential]:

take

burke]:

it with

confidential]:

and move

burke]:

you that you know,

confidential]:

right

burke]:

and the network is aware of all the different things that you're bringing to it and it has a place that. essentially,

burke]:

when you get there you you know, insert your your thing right, and it all kind of opens up like a peacock. Is you

burke]:

know what I'm seeing right and then you know, like

confidential]:

The

burke]:

everything

confidential]:

same time,

burke]:

there right

confidential]:

but at the same

burke]:

if

confidential]:

time,

burke]:

you're

confidential]:

when you,

burke]:

allowing

confidential]:

when you go

burke]:

others

confidential]:

to the

burke]:

to see it right.

confidential]:

right, and when you go to certain areas, they're only able to see the things that they're

confidential]:

able to see. So just because my wallet has five credit cards and seven bills in it, If I go

confidential]:

to Bruce's network and all Bruce can see are the American Express cards and my driver's

confidential]:

license. Guess what. Bruce only sees my driver's license and my American Press cards, Because

confidential]:

that is one of two things. I've said He can see them or two. That's all he's able to see,

confidential]:

and I validated that he can see those. Now I can go. I can go to another network or another

confidential]:

system and they can see everything. They've built out the capability to see everything, but I don't

confidential]:

want them to see everything. So when

burke]:

Yeah,

confidential]:

I connect the wallet, then I go. Okay, you can see this and you can see this and you can

confidential]:

see this. And so that's that's how, and that kind of, is that that helicopter float thing that

confidential]:

I've talked about Right

burke]:

Yeah,

confidential]:

Is that like when when I land in there they know It's then I can. I can tell them they can

confidential]:

identify that who I am not by name but by my block. Um, and then I can say Okay, hear all

confidential]:

the things that I'm here for And here's what I'm willing to authenticate with, but I just

confidential]:

I, really. I keep going back to the hardware. I think hardware wallets are going to be the

confidential]:

key to success This area, and the more we try and turn it into software, it's going to

confidential]:

be It comes back to centralization. You just

burke]:

I think a lot of the people are. Uh, you know we've talked about in the past that you know. Banks just replicated

burke]:

the paper experience digitally,

confidential]:

Yeah,

burke]:

Right skemorphics almost right. You know,

confidential]:

Yeah,

burke]:

even the checks look like you know check, right,

confidential]:

It looks like a check

burke]:

Kent from the pay show on Las Vegas, Right. He had the the check writing software right, And when you went on

burke]:

line to fill out the check, it

confidential]:

Looks

burke]:

looked

confidential]:

like

burke]:

like

confidential]:

a

burke]:

your

confidential]:

check.

burke]:

checks and your check. Right.

confidential]:

Yeah,

burke]:

Um, and people are so used to you go to a store, right, You don't walk up when you go the store. You don't walk

burke]:

up to the cash. yer here and go. Hey, you know, I'm going to go do some shopping around in your store. And what

burke]:

not? So here's why Wall, go ahead and hold on to that and I'll catch you after I've gone through the store and

burke]:

picked up some stuff right, So people are not used to that behavior and I think for a lot of people the first time

burke]:

Arrive at a Web three property and it's like Hi. So and so insert your wallet. Not even like you know who are

burke]:

you, or you know what your phone number or what you know. Do you want to set up an account or anything else?

burke]:

It's like Hi, you know. Give us your wallet right, and you don't even know what you're doing, So a lot of people

burke]:

are like you know, because they've heard all this crazy stuff and the news and everything right and they're like

confidential]:

Hm,

burke]:

you know.

confidential]:

Yeah, but I mean that comes into the overarching experience, right Aneverythe First time

confidential]:

you get asked for that a few times, and until you go through it, Like if you go to a store,

confidential]:

right, So if you go to a store and so, because are you ready to check out? But you don't see

confidential]:

a cash desk right, You're kind of kind of thrown off a bit because you used to go in to

confidential]:

a cashier's desk

burke]:

Yeah,

confidential]:

and then you go, they say Okay and I'm using apples. An example.

burke]:

Yeah, they got the

confidential]:

Okay,

burke]:

thing at

confidential]:

cool.

burke]:

the end of the table right.

confidential]:

Well, they reach out of their back pocket a device and they go cool. Let's scan. Scan. Or do

confidential]:

you have a card? Do you have it on file? That and you're like, Oh my God, I just I just wanted

confidential]:

to pay you with cash right, So it's the same kind of experience. I just I think that because

confidential]:

we over sensational ize all of the bad things that can happen that it's It's only made it

confidential]:

worse, and people are Or are scared to make a mistake and guess what. we're all going to make

confidential]:

a mistake. We're all learning at this stage, so we just we just have to be cautious. Have to

confidential]:

ask. why, have to ask what? and just have to ask questions along the way, just as if you

confidential]:

were handing somebody cat. So that's really kind of my perspective. I mean, I like the idea

confidential]:

of the wallet is a service. I can see it. I'm a big fan to Meta Mask because it's a decentralized

confidential]:

online. It has plug ins into all the browsers, which speeds up and makes it really easy. I

confidential]:

mean, done the really good part. Um, I'm just really

burke]:

Do you

confidential]:

looking

burke]:

think they're

confidential]:

forward

burke]:

starting to

confidential]:

to the

burke]:

gentrification

confidential]:

hardware.

burke]:

too early? Because that's what it is. It's gentrification When you're when you're putting something out like this, you're

burke]:

making it so you know anybody and everybody, and it's mass, main stream mass appeal. That's the reasoning behind

burke]:

all this right is. should we go through the new process? Should people have to go through that new process first?

burke]:

And you know, or is there? Is there a hybrid of The two?

confidential]:

I think by going down the wallet is a service. Is like I mentioned a Web to Dot Five. It

confidential]:

is

burke]:

Yeah,

confidential]:

the introduction into it right, And so you get into it and you, you're like Okay, Well, this

confidential]:

is really cool. I'm using the coin base, and you may not know it's coin base. You may think

confidential]:

it's a moon ray or a third Web or a token proof wallet. Right, because it's branded that

confidential]:

way, And so so now you're just used to that experience And when Comes time to do another

confidential]:

wallet? You're not going to be as scared And so you may have multiple. I'll tell. I've got

confidential]:

multiphysical multiple physical wallets right And so I think we're going to see that happen,

confidential]:

But this is a nice way to, because coin base has a huge user base, right, and so

burke]:

And largest

confidential]:

you can use it

burke]:

by trading volume?

confidential]:

Right. So you take the second largest customer based by trading volume, as you mention, and

confidential]:

you say, Hey, guess what. you don't need to go. set up a meta mask. You don't need to do

confidential]:

that. You can just use this this one And then now I go and I look at. Let's just pretend

confidential]:

Starbuck is using it. Now I go and Starbuck sends me a thing and says Hey, go ahead and

confidential]:

get this. The N. F. T Guess what I get to do? I go cool. Boom, and you don't even know that

confidential]:

you're using the coin based wallet? You just know that it's there and it's available

burke]:

Yeah,

confidential]:

and I think that's that's the first step.

burke]:

The question that came to my mind when Starbuck said Hey, you know, go connect your card right. They didn't even

burke]:

really want me to set up a wallet. They just wanted me to insert my credit card into some special place, and the

burke]:

N. the within the n f t autos aspect of their app right, which is kind of a. There's kind of a separation between

burke]:

buying a couple of coffee at Starbuck and buy an n n f T. some

confidential]:

Hm.

burke]:

Starbuck, Ers. there seems to be a line down in the middle, and I was Like Well, why can't I just fund by existing

burke]:

Starbuck's wallet for a hunder bucks with my credit card like I have been doing, and you can take it out of that

burke]:

right. Like why you know? Why aren't we co mingling coffee and and apes, you know, like why isn't that happening

burke]:

And I'm sure it's a

confidential]:

M.

burke]:

regulatory thing. I'm sure it's you know. there's got to be some legal reasons behind it. They want to keep it

burke]:

separate. Who knows right, but I think Probably they didn't want to make it too easy for somebody to mistakenly

burke]:

buy an n f t H, when they're really just trying to order a cup of coffee. Right, that sort of thing, right? what's

burke]:

this hondo dollars? right? I just wanted a lot ground, you know or whatever, right? So

confidential]:

So I think I think it goes a little bit deep. I'm not saying you're wrong. I think when

confidential]:

I look at it and I look at what the financial institutions and what the card brands require

confidential]:

when purchasing N f Ts, and doing all that fun stuff. It is quite different from when you're

confidential]:

purchasing a stored value purchase. They're totally

burke]:

Yeah,

confidential]:

different.

burke]:

yeah,

confidential]:

Um,

burke]:

because that's all

confidential]:

and

burke]:

I

confidential]:

so

burke]:

was doing. I wasn't actually giving them my credit card. I was buying twenty five dollars worth of Starbuck's credit

burke]:

that's sitting in my wallet waiting to be spent Right. So

confidential]:

Right,

burke]:

it's yeah, it is a different type of transaction. That stored value is a lot different than an n. f T. right, so

burke]:

it totally makes sense that they have it separated. But the fact that they're making it so simple, I Will help gain

burke]:

adoption for Web three, But

confidential]:

Hm,

burke]:

at what cost right? will it Or will it just gain adoption for we? two point five. Right and people go. well, I

burke]:

feel safe. stop in here and I don't want to go. You know, any deeper into you know the meta verse than this right.

burke]:

I'm happy with this right, you know. So in order to really become Web three, you know with everybody right with

burke]:

Star bucks with polygon with right, Uh, Amazon by all these different companies that are now offering up N f

burke]:

Ts, right, Read it right.

confidential]:

M.

burke]:

You know,

confidential]:

those are digital

burke]:

they gave

confidential]:

collectibles.

burke]:

every. They gave away a ton of them and you didn't even have to have a wallet right. That was just it was a collection

burke]:

and you could grab it and you know it was a profile identifier.

confidential]:

So he, here's here's where Star bucks and that are similar, Right? So it's a digital collectible

confidential]:

that is on a closed loop system. So so it is, It is on a private chain, private network, Ferredit.

confidential]:

And that's why you don't have to set up a wallet, and Star Bucks has set up their own private

confidential]:

chain Using So, And if I remember right,

burke]:

Yeah,

confidential]:

Um, and polygon, it was polygon. It wasn't salon polygon, Um. in there. And so so now there they're

confidential]:

separated, which makes it so they're not inter offerable And so

burke]:

Yep,

confidential]:

we're back in the same place where If do you want simple, or do you want it to truly be Web

confidential]:

three, And that's where we keep getting stuck in that middle where we're trying to pretend

confidential]:

to be Web three and keep it simple. And it's really web. two dot, one or two, o five, or

confidential]:

whatever you want to call.

burke]:

O. Does there need to be a Web Three Standards Board or a, You know, an association or organization that sets

burke]:

down Okay. In order to be certified, you know, stamped as Web three, you need to have this capability, this

burke]:

capability, this capability and this capability in your platform.

confidential]:

No, No, because it's super central, simple, decentralized like it's supposed to be And be

confidential]:

able to be portable. Those are the only two things that. really. It's super simple.

burke]:

Yeah,

confidential]:

It has to be interoperable

burke]:

I'm just like.

confidential]:

and

burke]:

I'm

confidential]:

decentralized.

burke]:

just thinking of the ober driver that gave me a ride the other day and I started talking to about the Amazon

burke]:

thing right and started talking to him about Amazon selling n f Ts, and that sort of thing, And he was an older guy.

burke]:

He was around my age right, So he liked to part about the Will Robinson and the robot right, But when I started

burke]:

getting off into companies and and h, n f ts, and tokens and Ins and wallets, and all this stuff, this guy started

burke]:

saying things to me that he had heard and what he had synthesized in his head from what he heard, and

confidential]:

Hm.

burke]:

he was coming at me with. Oh, well, yeah, when bit Com did this, and when you know and I was like, What are

burke]:

you talking about? he grabbed a little bit of information, right, The ice cherry picked some information that he was able

burke]:

to retain in his head, and it was Gobbledygooke and he had no clue what he was talking about from somebody who

burke]:

you know, listens and reads this stuff all day long, and I fear that that's the general public when it comes

burke]:

to this stuff, and he was probably a little more immersed in it than others. He's like, Yeah, all my friends tried

burke]:

to you know, get me to get into Crypto, And you know you know all that right, and he's like I didn't ever do

burke]:

any of it Now. I'm laughing at. you know, unless I was like, it's I am concerned

confidential]:

Guess what?

burke]:

that that's more of what the general public thinks of all this stuff than what we think of this stuff.

confidential]:

So I mean, it's the same with stocks. It's the same with bonds. it's the same with cities.

confidential]:

it's the same with. I mean, just list anything that has variability in it, whether people

confidential]:

in the same way with weather. So so I mean,

burke]:

Yeah,

confidential]:

so I guess I look at it is. you can be as intelligent or as ignorant as you choose.

burke]:

Oh yeah, absolutely.

confidential]:

And And And so what ends up happening is, depending on how you believe, it impacts you and

confidential]:

the perception that you have. that it impacts you and your life. and and how important it is

confidential]:

to you is going to vary greatly between person to person, and

burke]:

Yeah.

confidential]:

the level of depth that they go into will be based upon their interest in their. believe that

confidential]:

it's going to make a difference in their life. Like for me, I believe that this is going to make

confidential]:

a huge difference in my life, my kid's life, And it only makes Sen For me to dive so deep into

confidential]:

this to truly understand it, because I see from my perspective how amazing the world could

confidential]:

be if we continue to grow, leveraging block chain, smart contracts, and non, like distributed,

confidential]:

Leger technology, As well as non centralized wallets in the digital economy. Like I see

confidential]:

how big and how wonderful it could make things everything from, And me and a friend of

confidential]:

mine talked about this a couple of years ago when I started really getting crazy into the block

confidential]:

chain. Imagine imagine if every penny that you spent in Ta As you could trace using the

confidential]:

block chain to where that penny

burke]:

It

confidential]:

went

burke]:

went right, yeah,

confidential]:

and where it was spent, and by who and win,

burke]:

Yeah,

confidential]:

Whoa. Now,

burke]:

Yeah,

confidential]:

that's kind of scary because

burke]:

yeah,

confidential]:

there's going to be different types of people that fall into this. We can go on that wholly

confidential]:

different, whole different category, But in my mind is it you could get to that level.

burke]:

Yeah,

confidential]:

You could literally get to where every

burke]:

Red sand,

confidential]:

last

burke]:

as they say right,

confidential]:

is accounted. for. You know where it went, whether you liked it or not, At least knew where

confidential]:

it went.

burke]:

Yep,

confidential]:

You could also do that with. You could identify Which one of your representatives had done

confidential]:

that, and where it went and who that was tied to the end. On top of that, all of this is

confidential]:

public would be publicly available. It would all be out there. It would be full transparency, which

confidential]:

has never been seen before. And if you could get to that level of transparency, Ud be unreal

confidential]:

unreal

burke]:

But

confidential]:

So

burke]:

what I see that needs to occur is a lot of education. You know, you know we talk about, you know, getting people financially

burke]:

literate. you know, which is kind of why the first hash tag Pay deep dive is going to be around. Like what is Web

burke]:

Three right? Let's let's get people there first. Right like I don't. I think if if I stood out in the street tik

burke]:

tok style with my microphone and ask fifty, There's by

confidential]:

M.

burke]:

what is Web three it would be like watching it on Jimmy Kemmel. I think you know I would

confidential]:

Oh

burke]:

get

confidential]:

yeah,

burke]:

lie

confidential]:

yeah,

burke]:

awitinthes

confidential]:

totally.

burke]:

news, right I would. They would just be making crap up and they have no clue. I don't think. I don't think one

burke]:

in fifty could probably tell me

confidential]:

I mean this. this kind of rolls into our last subject of the day is really the S. B B collapse

confidential]:

and the sunami that it's creating right. And you know, I just was mentioning talking about leveraging

confidential]:

block chain to track taxes, But imagine being able to use block chain technology to track

confidential]:

where the deposits that I put into a bank where they've gone. Where Where did the money

confidential]:

that I put into the bank where the hat Is it?

burke]:

Right now.

confidential]:

And

burke]:

Yeah,

confidential]:

right at this at this exact moment, where is that money? And you know we, That's some of

confidential]:

the things that I think about. and like all these investors and all these other guys and girls

confidential]:

and people that have have put their faith in that financial institution Are now realizing

confidential]:

that what happened to F. t. X Can

burke]:

L.

confidential]:

happen

burke]:

c.

confidential]:

to

burke]:

s.

confidential]:

a bank to Celsius Voyage, or you name it right,

burke]:

Yeah,

confidential]:

Any time there is panic and people

burke]:

Over gate,

confidential]:

are worried,

burke]:

Yeah,

confidential]:

Silver Gates, another one, But but any time there's panic that people think that their money

confidential]:

is not safe. And and then the Us. we've We've trusted banks for forever, But if

burke]:

Yeah,

confidential]:

you go to other places in the world, nobody trusts the bank.

burke]:

Trill in South America, most people don't even put their money in the banks. It's you know

confidential]:

No,

burke]:

elsewhere right and I think may be moving forward. There's going to be a lot of people that maybe don't do it here

burke]:

in the U. S. right. one of my friends commented

confidential]:

Yeah,

burke]:

on on the cartoon I put up. You know the guy in outer space sweating right, banks

confidential]:

Yeah,

burke]:

are a scamp. You know banks are a. Sam, put all your money in crypto, and the other choice is cryptos and Sam

burke]:

put all your money Banks. It,

confidential]:

Right.

burke]:

you know the men of the week, right, He's like. Suddenly my mattress is looking a lot better right,

confidential]:

Hm,

burke]:

you know, And that's the sentiment that's out there now, Right and I think a lot of people are going to start stock

burke]:

piling cash. Right and start, you know, I read recently about a house that somebody bought from like it was

burke]:

built in the nineteen Twenties or something in you know the forties during the recess, And the whole wall was

burke]:

insulated with stacks of cash. The guy who ever built the house, you know, was just squaring a way o money in

burke]:

there and apparently never told anybody. And you know the house was insulated with money, you know absolutely

burke]:

insane right.

confidential]:

That is some extremely expensive insulation,

burke]:

That's a lot more than that pink stuff. I don't. I don't care if you're getting the spray stuff, the pink stuff,

burke]:

the the wool bats. I don't care. Money is

confidential]:

Ash

burke]:

a lot

confidential]:

insulation

burke]:

more expensive.

confidential]:

as much that it is, but I mean, and so if you look if we look at Silicon Valley bank, so

confidential]:

I'm just I'm going to just do like a really quick recap from my perspective, right So Silicon

confidential]:

Valley Bank bought a bunch of bonds, had I believe, like, one point seven five per cent

confidential]:

and two point five per cent. And you know they saw that happening, they aren't going to get

confidential]:

the returns and I, really, that's no big deal, because it'll It will eventually pay out

confidential]:

And they eventually get their cash. But they noticed that their deposits had continually started

confidential]:

to shrink, and so, in order to protect themselves from potential liquidity crunch, they decided

confidential]:

to sell about two billion dollars worth of those things at a loss to shur up their finances.

confidential]:

Now here's here's here's where I see. They're being too big as she's not. I've been on on zooms

confidential]:

and calls and interviews by a bunch of people about this over the last few days. I think

confidential]:

one. This was just bad timing that they did it the same day The Silver Lake decided that that

confidential]:

they were going to ask the f d i C to help them Re. structure. Second, they told everybody

confidential]:

to stay come. Which always works And which means it.

burke]:

O

confidential]:

There

burke]:

men.

confidential]:

was

burke]:

Carry

confidential]:

a.

burke]:

on.

confidential]:

There was a failure. communication failure. Um, And so what ends up happening Is that communication

confidential]:

failure, along with timing freaked out people that had money in the bank, And I mean, there

confidential]:

was a run on the bank to get deposits out, and there's still coming down coming up with all

confidential]:

the numbers around that, but I mean the f d I c is taken over the bank. They completely shut

confidential]:

down the bank on Friday. the D c is taken over the bank first thing on Monday morning. you

confidential]:

know over the week end what they're doing here, putting a bridge bank in place. Same they

confidential]:

did for a moo back. Gosh. it's been. I can't remember how long ago it was.

burke]:

That was a wild bit.

confidential]:

Um, two thousand and eight actually,

burke]:

Yeah, yeah, right after the the Helen collapse, That's when that occurred.

confidential]:

And so, S. V B had also been working with financial advisors to try and find somebody to buy

confidential]:

them before it failed. And it just they couldn't get it. Um,

burke]:

There's quite

confidential]:

but

burke]:

a bit going

confidential]:

it's just

burke]:

on from some of the stuff I've been reading and some of the stuff I've been watching. Also, there's a lot of

burke]:

commentary out there on it

confidential]:

Here's

burke]:

one.

confidential]:

a lot of

burke]:

the

confidential]:

bad commentary too.

burke]:

yeah, and there's a lot of different perspectives. The F d i C. S perspective on it was kind of unique and different

burke]:

To see it from the Federal reserves. I guess

confidential]:

M.

burke]:

F d i C. Federal Reserve. It's kind of you. He. same thing.

confidential]:

Those are. No. they're

burke]:

I

confidential]:

so

burke]:

know, there

confidential]:

different.

burke]:

are two different things, but they kind of The same view point. Let's say right from the federal government

burke]:

perspective, Right because,

confidential]:

Okay,

burke]:

but apparently the there's a. There's also an investor fund that's a S v B investor fund that's trying to garner enough

burke]:

cash. And what not to kind of take over Silicon Valley Bank, and kind of be the one that steps in and kind of

burke]:

takes it back from the F. d i C, and kind of moves forward with it. I was Watching our friend Bret King. He got

burke]:

on B B C. as a result of this story and was asked his opinion, You know, like they put on people on Squak Box and

burke]:

and other shows right. He got three minutes on B B C, and his perspective on it was something I hadn't heard.

burke]:

He. He mentioned a rumor that Peter Thiel, which is a huge, huge investor, probably one of the biggest as far

burke]:

as Sillakan Valley, Was the one that started the rumor that all the V C's should tell the people that they've

burke]:

invested in to go get their money out of Silicon Valley Bank. right. So it started, Let's say at the top Right.

burke]:

And so it started with a big v C. That told other V C's that I'm sure told other V C's right. That told there the

burke]:

people they're investing in, Right and man, that's you know, that's going to cause A stampede. you know, not a run,

burke]:

a stampede on the bank. And that's exactly what happened.

confidential]:

Yeah, and so it's interesting to bring that up. I don't know if it was that deep into it. I

confidential]:

think just the overarching fear. Um, because my friend and also partner in in in a consulting

confidential]:

business advisory business is not really consulting, but it's mostly advisory and helping

confidential]:

banks and Fin Text get placement in different places as soon as the announcement came out from

confidential]:

From Silicon Valley bank. When when they talked about opening up for shares to be bought

confidential]:

to get some additional liquidity right to them selling off the bonds. Them doing all these things.

confidential]:

It went nuts with people going. Oh, shoot, I need to find a new bank to put this in, Because

confidential]:

if they're trying to show up their finances, I don't want to be at a bank that's trying

confidential]:

to show up their finances plain and simple. And so these guys are trying to pull money

confidential]:

out and they are a ton of people who had wires. That had just been like everybody was rushing

confidential]:

to go wire money out of one account and into another, and a lot of the wires just didn't

confidential]:

make it. They just

burke]:

I

confidential]:

didn't

burke]:

read a couple

confidential]:

make

burke]:

of stories

confidential]:

that

burke]:

about the guys. Like we sent the wire. They charged us the fee, but you know it didn't happen right. I read that

confidential]:

Right.

burke]:

Breck Bre Breck was somebody that a lot of people flocked to to take their money from Silicon Valley bank. The

burke]:

one that did get it, and the ones that had other money. that they were probably going to take the Silicon valley

burke]:

right in the next week or so right, and they put it in bricks, so That

confidential]:

It was. it was about that was only about two billion dollars went into Brek. Uh,

burke]:

That is that all it was that they refused

confidential]:

yeah,

burke]:

to comment on it. In

confidential]:

yeah,

burke]:

the article

confidential]:

it was about

burke]:

I read, They didn't

confidential]:

so.

burke]:

want

confidential]:

So

burke]:

to talk

confidential]:

rumor,

burke]:

about it.

confidential]:

rumor is, it's about two billion dollars, but Rex isn't even a bank. So Brek is is a neo bank

confidential]:

that leverage other banks, And so those deposits, Wen of those other banks. But you know

confidential]:

I'm not going to share the name of the banks, but I know a few other banks that received

confidential]:

a large number Of funds ranging you know from a couple million dollars up to you know, tens of

confidential]:

billions of dollars. And they were traditionally other fintech banks.

burke]:

Yeah,

confidential]:

We were talking to a number of them over the over the dates, and that one of the things that

confidential]:

Janet Yellin said that really drives me nuts is and to have somebody in her position say this

confidential]:

is what really irritates me. If in And I'm gonna, I'm going to bascardize this quote, but

confidential]:

basically it was if I had money, I would not put it in a regional bank, which is really

confidential]:

scary to have someone of her stature of her position to be able to say something like that

confidential]:

and not have any repercussions, Because think of all these regional

burke]:

Doesn't

confidential]:

banks

burke]:

say much

confidential]:

that can

burke]:

of regional

confidential]:

actually

burke]:

banks right. It doesn't say much of the federal opinion of regional banks. For one, right

confidential]:

Right. but at the same time, J P. Morgan Wells Fargo City group, I mean all these guys who's

confidential]:

at, say they're any better right. Who's to say that they're doing things any different And

confidential]:

so

burke]:

Banking is banking. I mean, what can you do with money? Once you got it, you invest it to hopefully make more

burke]:

money, And that's pretty much

confidential]:

Hm.

burke]:

the beginning and the end of it. What's really concerning to me? You know, there's a lot of different statements

burke]:

that are coming out, and a lot of statements are kind of just being said, kind of willy nilly. It seems like right

burke]:

to people. Are you know making condemning type of statements? But think about this. think about your v. C. right,

burke]:

And you invested in some start up right. Let's say you just gave the guy. Let's say five million Right. That

burke]:

seems

confidential]:

Yep,

burke]:

to be a good central number. Right, And so now you've got your your bits of stock. You know that you got big,

burke]:

throwing your five million in. Right if you didn't go in as an angel, right if you went as an angel like Forget

burke]:

it. You got nothing now. But even then a lot of these startups are not making income yet because that's kind

burke]:

of a thing with a start up now, right. I mean, we just talked last week about Revolute. Finally Is is profitable

burke]:

right and there, What? Five years in right and and pushing millions and millions of dollars through their bank

burke]:

or their card or their platform or whatever you want to call it, And you know just this year were profitable

burke]:

and just because of some, I'm not going to say manipulation of our book, Because that, but you know they did

burke]:

some things different right and that made them profitable. Finally. so think of this Small startups right that

burke]:

all these vices have invested in that aren't profitable yet. Some of them don't even have any income yet, and their vendors,

burke]:

their employees, their landlords, their equipment, financing, their, you know, their services.

confidential]:

Yeah,

burke]:

everything is just going to be, you know, and a lot of people are going to be out of jobs right. But then also

confidential]:

A

burke]:

think, think of the V C that You know, take in his money. put it in, and he's got some stock now. and if that

burke]:

company's in dire straits, that stock is pretty much going to be worthless. right. So as a v C, do you take more

burke]:

of your money and re capitalize that company and keep it going. You know, so you don't lose what you've already

burke]:

already lost, Or you know how do you go from there right?

confidential]:

Yeah.

burke]:

You know,

confidential]:

Well, I mean, and

burke]:

there's a

confidential]:

that's

burke]:

lot. A lot of people are going to be affected in a lot of different ways. Is what I'm saying

confidential]:

And that's That's why I'm calling it the Svbsunomi right. So so you see this huge wave

confidential]:

of all this stuff coming in, and when the wave goes out and everything calms down, you actually

confidential]:

get to see the level of destruction that has happened, And and you're going to have people that have

confidential]:

the means to rebuild. you're going a find the people who don't have the means to rebuild.

confidential]:

You're going to find bodies everywhere. And So it really comes into. and this is. this is.

confidential]:

The scary part is those who were on a path to generating revenue who had a clear path to

confidential]:

generate revenue. I believe that you're going to see people get re capitalized into that.

confidential]:

If they believe that there's a way to revenue, they're gonna recapitalize if it was just a

confidential]:

hunch. Probably not going to get it

burke]:

When they say

confidential]:

right,

burke]:

it is one out of a hundred. Is the unicorn right? That actually makes it right. So you know how much is this going

burke]:

to affect? You know, with the V C s losing the V C, S are really the one that lost right the money that they

burke]:

gave these guys. those guys lost to right. But the V C ultimately is at the top and you now hand it over to

burke]:

stack right. So he's the one that really lost money or she. And so how much is this going to affect investment? Other

burke]:

companies moving forward, I know a lot of them. Are you know, big, and I've done a lot, but a lot of them were

burke]:

also involved in. You know, H, f t. X, you know Celsus Voyage, or you know Genesis Silver Gate. It's It's been

burke]:

like Fin Tech, Because mostly, if you talk about checking and sell Kind Valley Bank, you're mostly talking about

burke]:

fintechbecause. That's what kind of becomes the unicorns. Not much else become G.

confidential]:

Ind,

burke]:

A

confidential]:

of

burke]:

corn.

confidential]:

kind

burke]:

You

confidential]:

of

burke]:

know,

confidential]:

yeah,

burke]:

So

confidential]:

but

burke]:

how much is this

confidential]:

but looking

burke]:

going to affect our industry Right? generally, as a whole, right,

confidential]:

So so the way I'm looking at it, and this is just my perspective. Um, I think you're going

confidential]:

to continue to see investment go into the industry because all this is just like the f. t.

confidential]:

X collapse. Just like a couple of other things. People are going. Okay. this just happened.

confidential]:

What can we build? What can we create? What can we combine? Keep this from happening again.

confidential]:

And so you're going to see a shift. And and this is something we've already started to see.

confidential]:

At least I've already started to see. By looking at the technologies and everything in the

confidential]:

industry is you're seeing a shift from how do I deliver really cool things to customers

confidential]:

To how do I deliver tools to financial institutions to mitigate risk? How do I deliver

confidential]:

tools to these men Text to mitigate their risk and the banks risk of this? because as much

confidential]:

as we we hate to think this right now, and and probably for the foreseeable future, Um, the

confidential]:

center of gravity for everything we're talking about is a financial institution.

burke]:

Yeah,

confidential]:

So if we're not helping them manage risk, if we're not helping them manage all these different

confidential]:

things, and we don't have things in place to really mitigate the stuff. That's where we're

confidential]:

gonna have issues. but I think that's where the V C stuffs going to go into. and just just to

confidential]:

be clear, I mean one of one of the things that I read, and I haven't had a chance to dive

confidential]:

really really deep into it, But there was, there was some legislation that got rolled back

confidential]:

a few years ago. Think like, four or five years ago that would have actually protected all

confidential]:

of this from happening. Um, so I haven't gotten deep into it. Yeah, but I know there is some

confidential]:

legislation around how to manage liquidity, How to manage what your assets? All of that

confidential]:

fun stuff. and you know I've had the benefit of men spending time with the former chief risk

confidential]:

officer of West America Bank, who was also at Bmoharris and a handful of other very large financial

confidential]:

institutions, and just kind of talking about What happened and you know his his perspective

confidential]:

was was like this. This is a failure of some of the basics of maybe reaching a little bit

confidential]:

too far. Um,

burke]:

Being unbalanced

confidential]:

when we, you look

burke]:

that

confidential]:

at it from the risk management

burke]:

they're unbalanced

confidential]:

perspective,

burke]:

you. you know they re unbalanced Right. So you were

confidential]:

It wouldn't

burke]:

talking

confidential]:

have been a

burke]:

earlier.

confidential]:

problem.

burke]:

You were talking earlier about from a consumer standpoint, What if every dollar that you paid into the federal

burke]:

government, you know, was on a block chain, and you could see where every single penny

confidential]:

Yeah,

burke]:

of your money went, So now let's

confidential]:

yeah,

burke]:

shift the perspective of this. What if the federal government was able to watch every penny that came into a bank

burke]:

Ink and was able to see where it went, Not the consumer, but now the Feds, the regulators, I'm speaking of,

burke]:

specifically right, and they could now watch that bank and really see that that bank is being managed well right,

burke]:

It's balanced. Its Ou know it's not too heavy on one side. You know, it's not too heavy on the start up side.

burke]:

It's not too. It doesn't have too much junk bonds right. It's got good investments and it's got A variety of depositors.

confidential]:

So this is. this is where the regulators come into play right, so the regulators come in

confidential]:

and audit the banks on a regular basis to make sure that that exactly

burke]:

They got a fleet

confidential]:

is

burke]:

of.

confidential]:

not happening

burke]:

They got a fleet of people that go out and do that stuff all the

confidential]:

Right.

burke]:

time.

confidential]:

So they're doing this on a regular basis. Now If you were to bring in a technology like

confidential]:

block chain, and you are allowed to just pull that information, I think it would be more real

confidential]:

time, but that still doesn't solve the problem that we have. because,

burke]:

Think,

confidential]:

because,

burke]:

let me ask you this, and I've been thinking about this for a while back when money was backed by the gold standard

burke]:

here in the good old U. S. A, which we don't have any more. We had a Fort Knox that held all the gold that standardize

burke]:

the money right. Does cash need to just stay in a place as cash When it's deposited? I know not so much money

burke]:

is deposited as cash any more right. But because cash is Digital now right, Could we even do that to begin with?

burke]:

Right and does something like that need to happen? So when a bank says you know, Yeah, we get your cash. they physically

burke]:

have your cash and they're not out using it, But I know that's how banks make money. Right Is you know investing

burke]:

it and you know you know slight risk right, not not much risk, slight risk, you know, but it just seems like

burke]:

the technology could be used from the regular Here's to the banks, also not just from the consumers to the banks.

burke]:

Right.

confidential]:

So, the idea of having Access liquidity of all the cash has ever been deposited in your financial

confidential]:

institution, The only way to do that ever is to have a state sponsor financial institution

confidential]:

If if it is owned by the government, that's the only way you'll ever do that.

burke]:

Yeah,

confidential]:

And honestly, I can't ever see us getting in if we do get to it. I'm scared, but having

confidential]:

a a state sponsor Bank,

burke]:

We would become China.

confidential]:

M,

burke]:

Essentially we're China. Then

confidential]:

Exactly exactly,

burke]:

Yeah,

confidential]:

But, but what we do come into play here is

confidential]:

Roblem. That we have here is is too many people being worried that their money is not safe

confidential]:

at the exact same time, and part of the conversation you and I've had over over the months

confidential]:

and years is getting people comfortable and feeling safe about where their money is located.

confidential]:

is is have That transparency. And and again, I think if we could provide the level of transparency

confidential]:

to the companies or individuals that have deposited the money in this, they can see where it's

confidential]:

at. Then I think they're going to be more comfortable and so this is all about trust, which

confidential]:

has been lost and being able to back it up. And

burke]:

You think like you and I have worked at companies right our whole lives, and I've worked at a lot of companies

burke]:

where the accountants are regularly pooped by the c, e, o or the leader. You know the president. whoever, right.

burke]:

you know. they're like.

confidential]:

Hm,

burke]:

Well, we really shouldn't do this right now, because x y n z, right and the guys like Damn the torpedoes full speed

burke]:

ahead, right Nd. we're just going to go out. You know, this is my vision and we're going go out and kill it and

burke]:

we're going to ignore your advice, So you know we're just gonna stampede

confidential]:

Yeah,

burke]:

forward right. You've seen it. I've een, it. It's happened more times than I can imagine right. so even having

burke]:

the transparency, it still comes down to the behavior right n

confidential]:

Transparency will change the behavior And then that's kind of where I'm getting at, Is it?

confidential]:

by having a level of transparency where anybody and everybody can see it And it's not just the

confidential]:

regulators that are seeing it, And yet you could go dig through a bunch of stuff at Bab

confidential]:

blah. But if you could programmatically do it, and you as Vic's and private equity firms and family offices,

confidential]:

there's a reason why they hire quant. They can do quantitative Alysis on all this information

confidential]:

with what they're given. But if you make it truly transparent and you give them all the data,

confidential]:

they're going to be able to figure it out. They're smart people. They're very smart people.

confidential]:

And so that's kind of where I get at with a lot of this stuff, is it? We've obvsicated so

confidential]:

much of the data of the information and only given up what we had to in order to get to where we

confidential]:

wanted to be That we're getting into the next level Of data transparency. And I mean, give you

confidential]:

an idea, The stable coin peg, and this is one of the articles and one of the things we were

confidential]:

talking about with circle circles. Stable coin wasn't so stable over the last few days

confidential]:

because of their ties to S. V B. And but they've already recovered, they've already gotten

confidential]:

back, so it's back stable again

burke]:

The run. The

confidential]:

and

burke]:

run is over now, Right so the run on them is also over. Do, let me ask you a question. Do you think the run occurred

burke]:

Or was heightened exponentially by all the recent collapses of F T, X, Silver Gate et Cetera, et Cetera, et Cetera.

burke]:

Do you think

confidential]:

Dude,

burke]:

that caused more panic than it would have caused six months ago?

confidential]:

Ally, and that's that's what I was getting at earlier when I was talking about timing and

confidential]:

messaging right. So the timing of it was horrible. I mean, we just had f. t. X. and and everybody

confidential]:

started to get over that and then Silver Gate the same week, Like the week before, they said

confidential]:

we're in trouble Right

burke]:

Yeah,

confidential]:

then then I think it was

confidential]:

Last week. Yeah, last week, several gate says I'm in trouble and we're trying to figure this

confidential]:

out.

burke]:

Yeah,

confidential]:

And then then they ask. On Thursday they asked F. d. I, C. Hey, help us Re, structure this

confidential]:

so that we don't. we don't go under. Although they've pretty much already gone under by

confidential]:

that, And on the same day within hours of that, That's when that's when S. V B decides

confidential]:

to make do the sell off. Make the announcement. Say everything is fine. I mean it. Just the

confidential]:

timing is horrible

burke]:

And

confidential]:

if

burke]:

not

confidential]:

they

burke]:

to,

confidential]:

had done

burke]:

not

confidential]:

it. If

burke]:

to

confidential]:

they.

burke]:

mention that they handed out the bonuses the day to all their I don't know as eight thousand employees. Something

burke]:

like that. they handed out their annual bonuses to all their employees the day before the F. d. i C took control

burke]:

of Silicon Valley Bank. Anywhere from twelve hundred to hundred and forty thousand dollar bonuses for their employees

burke]:

based on the banks performance for the year. You know,

confidential]:

Yeah,

burke]:

So That's that's not a good look right for the bank. I mean, it's an annual thing, and nobody can really say

burke]:

anything about it and just happened the fall right. It's a annual thing and it's scheduled, and but it happened the

burke]:

day before the f. d. I C took control of the company right, I'm sure

confidential]:

And I'm

burke]:

the employees are all like. Thank God, you know that I got my bonus, but you know.

confidential]:

I mean in. so the like annual and four bonuses almost always fall at the same time right.

burke]:

Yeah,

confidential]:

I've been in the industry long enough that they almost always fall on on the first Friday

confidential]:

of March. They almost always follow in Right. And so this has already been sitting in the

confidential]:

pay roll for forever, and realistically they probably thought that they were going to Fine.

confidential]:

They probably thought that they were going to be able to pull this off. And you know it,

confidential]:

Bank, and the V C's and the companies, Yes, I feel for them and everything.

burke]:

C. O. What's his name? Beecher, Garry Beecher,

confidential]:

Hm.

burke]:

He's like It's with a heavy heart, Right And they started this whole thing over an in a poker game. The Silicon

burke]:

Belly bank, you know, started

confidential]:

Hm,

burke]:

at at a poker game back of a napkin. Kind of a thing right, you know,

confidential]:

Yeah,

burke]:

so

confidential]:

but

burke]:

go ahead. I'm sorry I interrupted

confidential]:

I

burke]:

you.

confidential]:

was just going to say like, no, no, No, No, So so I'm sitting here thinking about it like

confidential]:

S. v, C. S. they're going to be fine, Um, but the employees of Silicon Valley Bank, and

confidential]:

the employees of these tech companies that had billions of dollars sitting in there where

confidential]:

there d be roku. Whether it be companies like that that have a bunch of money in their circle.

confidential]:

You name it right.

burke]:

Let's think of a little guys, too. I mean, you know there's there's. you know, there's a few big ones, but there's

burke]:

a lot of little ones and that actually hurts the echo system more than a few big ones Right because it's that

burke]:

now all those employees and all their customers right are now also afraid of bank collapse. Right because

confidential]:

Yep.

burke]:

it's Affect them too right. It's not just affecting those companies that's affecting. You know, you know, down the

burke]:

line down the line. And so how does the Federal government or the Federal Reserve, or you know other people that

burke]:

are involved in banking? How do they turn this sentiment around? Because there needs to be some damage control

burke]:

right. Just

confidential]:

Yeah,

burke]:

just fishing these guys out of the water and making them whole, And which I don't think is really going to happen.

burke]:

How did they change that public sentiment? You know, we don't trust the banks. Banks aren't your friends, like

burke]:

Alex Micinski said, right, you know.

confidential]:

Well, I think a lot of it's going to come into play over the R. the next course of the next

confidential]:

few weeks when the f d i c h starts to dole out the hundred and seventy five billion dollars

confidential]:

and customer deposits that fall under the that fall under that control right so, I think

confidential]:

you're going to start to see that, but let's not forget that the quantity quantitative easing

confidential]:

and the raising of the interest rates and all of these things, the Interest rate change is what

confidential]:

caused this to happen.

burke]:

Yeah,

confidential]:

I mean,

burke]:

the

confidential]:

we,

burke]:

bonds

confidential]:

we, we

burke]:

that

confidential]:

can't

burke]:

they were making two percent on wasn't enough. when they went to sell it. It didn't have the same value that

burke]:

you know they bought it at. And especially when you're trying to sell it quickly. Right, If you can wait to sell

burke]:

things, you can usually get a fair price right. But if

confidential]:

Right.

burke]:

with something like this they're trying to like, Hey, we need to turn these things over so we got cash so we can

burke]:

give to our customers, and that's

confidential]:

So

burke]:

where you lose. right

confidential]:

so so part of part of me, part of me says Well, the government caused it by the Fed, caused

confidential]:

it by raising the rates. Maybe they should fix it. Maybe they should fix it And this is. this

confidential]:

is me being altruistic, right. It's like you caused the problem. Fix it. And and you know everybody's

confidential]:

worried about interest rates continue to Go up. Inflation is continuing to go. It's like we're

confidential]:

using all these old school methods to try and stop something that no longer work. So let's

confidential]:

why do we keep doing the same things over and over again and expecting a different result

burke]:

Here's the thing. prices keep going up, So companies are now bringing in more money because prices are going up, So

burke]:

companies can

confidential]:

And

burke]:

afford

confidential]:

the process

burke]:

to

confidential]:

will

burke]:

start

confidential]:

continue

burke]:

paying.

confidential]:

to go up.

burke]:

Companies can start afford to can now afford to pay employees now more wages because they have more money coming

burke]:

in because prices are going up right and a lot of

confidential]:

They

burke]:

companies.

confidential]:

have to pay more money for the interest rates on the loans that they took in order to get

confidential]:

the stuff. And so now your cost of money just went up. So

burke]:

Yeah,

confidential]:

you have to, in order to keep in business, you have to spend more on on all of this stuff.

burke]:

Yeah,

confidential]:

And so the last person to get any more money is going to be the employee, because the business

confidential]:

is trying to maintain at least the revenue that they were generating before, so they can keep

confidential]:

paying the people what they were Paying them before. But the cost of the dollar is now higher

confidential]:

because the interest rates are higher. So if they have to buy anything with with money or

confidential]:

capital that is on a loan, then now it's like it's this perpetual cycle.

burke]:

Yeah,

confidential]:

It's a perpetual Syce.

burke]:

so six months ago, let's call it a year. If you want to really go out there, We had a zero interest rate and

burke]:

essentially money was free and everybody could get as much money as they wanted free of

confidential]:

It

burke]:

charge.

confidential]:

was.

burke]:

Pretty much

confidential]:

it was. T was some sub one percent

burke]:

So they've added points. They've added points. they've added points. Where is it now? What is the actual fed

burke]:

interest right now? What is it? Do you know? Is it

confidential]:

Last

burke]:

seven

confidential]:

time

burke]:

per

confidential]:

I

burke]:

cent?

confidential]:

looked Last time I looked, it was around seven per cent.

burke]:

That's a big jump in less than I'm going to say in less than a year. I'm going a guess. it to be about eight

burke]:

or ten months since they really started. You know, let's call it aggressively, you know, raising interest rates,

burke]:

and they even said last week that they had thought that a quarter point raised was going to do it, And they didn't

burke]:

think that the quarter point was really accomplishing that, and they were going to take it up to another three quarter

burke]:

point was going to drop Instead of a quarter point. You know

confidential]:

Well, and that's that is why. Um, I. I look at it and I'm like this. This isn't working. It

confidential]:

isn't working. folks. Way you're doing is not working. Quit making it worse. I'm trying

confidential]:

to find it right now. Just please

burke]:

Would, I would say

confidential]:

bear

burke]:

it's right

confidential]:

with

burke]:

around

confidential]:

me.

burke]:

seven. I heard right around seven recently, but I don't know if they've levied that three quarter point that

burke]:

they said they're going to levy the other day. It was just a couple of days ago that I saw that article. Um,

burke]:

Well, I can say this. It's going to be all the talked next week at Fintchmeta, In last

confidential]:

Yeah,

burke]:

I alknoist. Want to go and see if I can find Day the cell, Con Valley Bank T shirt to wear around to us Our conversations.

confidential]:

So I'm looking here. I'm just I'm looking three days ago. The Fed raise. I'm just I'm trying

confidential]:

to find,

burke]:

What's the sum? total? Right

confidential]:

So it's

burke]:

Would say,

confidential]:

looking.

burke]:

it's been at least six raises. Uh, if not seven raises that they've done over the course of the past six months,

burke]:

maybe eight.

confidential]:

Yeah,

burke]:

I don't know. I don't have it in front of me and to go find it is, you know, an exercise and futility sometimes

burke]:

because all you're going to get is add from banks, push in interest rates that you know. Uh,

confidential]:

That's what I'm getting, but I think I found

burke]:

waiged through all that.

confidential]:

a couple of things.

burke]:

Yeah,

confidential]:

Yeah,

burke]:

it's it's not the free money that they're used to, but in my mind, like you said, the V C's vs aren't invest

burke]:

in cap, But all they can't afford to lose right in most cases, unless they're you know a small investor right,

burke]:

they're You know. they're throwing money at a hundred companies, Knowing that one of them is going to, you know, come

burke]:

out smelling like a rose. right? so they throw away a lot of money and know that they're throwing it away when

burke]:

they're throwing it away,

confidential]:

Mhm,

burke]:

But um, I don't think that you're going to see the level of investment that we have been seen even know, post

burke]:

f t, x H, you know, and definitely not the level that we saw the last couple of years with you know, money being

burke]:

almost free, right, that's you know. It was. the stock market was wild. the investments were wild, the evaluations

burke]:

were insane. You know. Uh, you know, they were writing checks to everybody and their brother right, So

confidential]:

So

burke]:

it's going to be crazy.

confidential]:

yeah, all right, So the Fed discount rate right now is four point seven, five per cent A

confidential]:

year ago, it was point two, five percent, the current prime rate, which is what everybody

confidential]:

bases Um interest rates on loans and things of that nature is at four. Sorry is at seven

confidential]:

point seven, five per cent, and a year ago it was at three point two, five per cent.

burke]:

S a

confidential]:

It's a heavy

burke]:

doubling?

confidential]:

increase.

burke]:

That's a doubling on the one.

confidential]:

Yeah,

burke]:

the loan of money

confidential]:

on the

burke]:

right?

confidential]:

well, I mean, it's even more if you look at the Fed discount right right,

burke]:

Yeah,

confidential]:

so you can see. You can see that the prime rate is not increasing at the rate that the Feds

confidential]:

increasing, Because everybody understand that if they increase that fast, it's just going to

confidential]:

grind everything to a halt

burke]:

Yeah,

confidential]:

like everything will just stop.

burke]:

Yeah.

confidential]:

But oh my goodness, Well, so I'm going to close this out by saying, this is not financial

confidential]:

advice.

burke]:

Yeah.

confidential]:

We are not financial advisors. This is purely for educational informational purposes. Please

confidential]:

do your own research to determine what you see is factual. What you see is important to you and

confidential]:

make your own decisions. So

burke]:

Are you reading that off or something?

confidential]:

I'm actually not, but I've said it so much

burke]:

Yeah,

confidential]:

that yeah,

burke]:

it's

confidential]:

it

burke]:

a.

confidential]:

happens

burke]:

It's a good thing to say. Yes, we are. we are. not, neither not. I or Ted Is offering financial advice on any

burke]:

of your money. Your n f, Ts, your tokens, your stocks, your bonds, your treasury bills, your junk bonds. Whatever

burke]:

your buying, we're not given financial advice on it. my advice. All my money is tied up in cash.

confidential]:

Well

burke]:

That's

confidential]:

and I will, and I'll say it this way. Um, we are here to provide our opinion and our perspective

confidential]:

only, and you should take and listen to professional advice around how to manage your money

confidential]:

and what to invest in and when to invest it in, and how to manage it and make that yours.

confidential]:

Make it your decision and do the research. So Bruce,

burke]:

Never never invest your money off of free advice that someone gave you

confidential]:

Real H, done that a couple of times And

burke]:

A.

confidential]:

yeah, I still don't have that money. But hey, so Bruce, you'd mentioned the fact that the Fintech

confidential]:

meet up is coming up next week, the nineteenth through the twenty second in Los Vegas,

confidential]:

Nevada, at the beautiful and wonderful Area, hotel and casino. Um, I will definitely be there

confidential]:

and talking to a number of folks and getting scheduled up for some one on one Interviews.

confidential]:

And Bruce, I think you might be joining me as well. there, Um, doing about a lot of the same

confidential]:

stuff, but you want to fill us in on some of the other projects you're working on.

burke]:

So let's start at the top.

burke]:

Been doing the bullet point bulletins for a number of months now, and I wanted to expand beyond that if you're a

burke]:

first time listener, and I wanted to get back into interviewing people from the industry and doing in depth interviews.

burke]:

so I started hash tag pay interviews. I resuscitated the pay brand from twenty nineteen and started pay interviews,

burke]:

And now that's manifested into a website which I just launched at eleven o'clock last night. Uh, it's just rudimentary

burke]:

form factor. It's nothings final there and it's always going to be a working document. There's always going be

burke]:

new duff added. but pay interviews dot com, P, a y, i, n t, e r v, i e w s. dot com. Um, and what we're going

burke]:

to up there is the bullet point bulletins, video vineets, The two or three minutes short news features that we're

burke]:

doing. we're going to have the more in Pay interviews where I'm interviewing luminaries from Web, three fin tech block

burke]:

chain, a crypto currency, et cetera, banks et cetera, and then also a a group of pay, deep dive research and reports

burke]:

where I'm diving a little deeper on a single selected topic like gene to or web, three or block chain, or something

burke]:

similar. So Uh, I'm currently looking for a sponsor that's going to help me, uh, uh, uh, cover the cost of going

burke]:

to find tech. Meet up what I have to offer. Ise your commercials will be in the videos. You'll You'll essentially

burke]:

be a sponsor of all the videos that I produce and the videos that I'm going to produce and the videos that Ted's

burke]:

going to produce will both be play On both channels. So you're going to see Ted's interviews from Fintech Confidential

burke]:

on my Youtube channel and vice versa. Right. The interviews I do will be on Fintech Confidential And so everyone

burke]:

will get more visibility more. You know availability, and and gain a lot from it. So if you're you know, launching

burke]:

a new product if you're releasing a new book, if you're re inventing your Corporal Ation, and you know, like you

burke]:

should every two years putting out something new. If you just want to establish, start establishing thought leadership.

burke]:

This is a great way to do this. We're always looking for companies that have quality products and services that will

burke]:

benefit are r, our audience And you know they're well qualified audience, And you know is a great opportunity.

burke]:

Pay me up, or I'm sorry. In Meta, I'm already named my company. Fintehmetup is a Neil Argowall that started T back

burke]:

in the day, and then he started money, twenty twenty, and then shop talk behind that and now it's Fintechmetu. So this

burke]:

is somebody who's very successful in those channels. This is a big deal. This is not a little fin tech Me up right.

burke]:

This is not ten people meeting together that I believe

confidential]:

Over

burke]:

there's something

confidential]:

three thousand people attending

burke]:

Right,

confidential]:

that

burke]:

and

confidential]:

are registered to attend

burke]:

and and going through and setting up meetings with all the different people I've already registered. So all the

burke]:

different companies that are there, and looking through all the different companies there's start up. There's

burke]:

the major banks, there's all the process, there's there's fin text, there's web three, there's there's everything

burke]:

there And you know it's going to be a big event and the area is a really great place. March is a really good

burke]:

time to be in Las Vegas. This is probably there saying this is the big quarter one event. You know for the year

burke]:

right, if you're in the financial services space, So if you're going out to the show, I look forward to meeting

burke]:

you there. Please hit me up, Bruce at pay interviews Dot com. you can reach me. Also, you can find me on you tube,

burke]:

But at Bruce Burg, that's going to be changed over to pay interviews. I'll let you know when that's happening, and

burke]:

Also on other socials. I'm Bruce Qburkso and I'm starting to establish pay channels. You know, profiles for all

burke]:

those different social network. so uh, it's a lot to build a new brand or rebuild a brand. I'm I'm one guy. going

burke]:

at it to the nail. I could use a little support and a little helped to move things along. And anybody who Interested,

burke]:

please reach out and Ted. what are you doing? I know you're going to fine confidential, but you're doing something

burke]:

else this this coming week. Where are you going?

confidential]:

This week. Believe on it this week. I'm actually doing a little bit of a pre visit to Las Vegas,

confidential]:

so I'm going to Las Vegas and going to be meeting with a handful of folks while I'm up

confidential]:

there ahead of the show, but then going to be turning back up on the nineteenth, so we'll

confidential]:

be returning back up to the nineteenth for vintechmeetup, Be there with Fine confidential

confidential]:

and in a handful of other different things, But it's going to be really cool. We've got

confidential]:

all that going on. Leasing a bunch of additional episodes. Uh, been a little bit difficult

confidential]:

to get a lot of these episodes done. I've been spending a lot of time on all of these bank things

confidential]:

that have been going on, so, uh, you know, last week was in New York and was in Chicago, so

confidential]:

it's just it's lots lots of busy travel and really just diving in and learning from all these

confidential]:

different folks, So really cool stuff. If you want to learn about what were Doing, we've

confidential]:

got the Telegram channel for a web three with F. t, C or Fine Confidential. You can go ahead

confidential]:

and sign up for, and you get news sent to you just about every hour on the hour. with great

confidential]:

information. You can also follow us on Instagram Face book, and linked in at In Confidential,

confidential]:

and of course, Twitter makes it always so fun for us. It's at F T confidential dot com. If

confidential]:

you want to get a little bit of insight into who Ted Huff really is, check me out every Ere

confidential]:

at t, e d d h u f F. If you just do a fun little Google search, you will be able to find

confidential]:

me just about anywhere, so we're wrapping up for this week, but next week we'll have even

confidential]:

more information and Bruce. let's let's play us out. Man.

burke]:

Let's let's hope for some some more uplifting news this next week, And

confidential]:

Yeah,

burke]:

you know, I try and keep it on the positive tip, but this week it was just overwhelming, but

confidential]:

So

burke]:

at the

confidential]:

much.

burke]:

same

confidential]:

going

burke]:

time

confidential]:

on.

burke]:

still very interesting. But thanks again, Ted for participating this on the weekly basis. Look forward to seeing

burke]:

in Las Vegas. I'm setting my intention and intention on the fact that a sponsor. It's going to cover my costs to get

burke]:

out there and help help launch Pay in a bigger way, It's going to help. Even though I'm going out as a, you

burke]:

know, a Finteg confidential. Give me the opportunity to kind of spread the word about hash tag, pay and get that rolling.

burke]:

So there's a lot going here and we really appreciate you guys like follow, subscribe, and share, and we'll see you

burke]:

next week right back here At Bullet Point bulletins.

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