Nov 10, 2023

"Digital Money Demystified" author and Penn State Dickinson Law professor Tonya Evans joins "First Mover" to discuss the latest moves BlackRock is making for an exchange-traded fund (ETF) for Ethereum.

Video transcript

The state of crypto is presented by Tron connecting the world to the power of Cryptocurrency. Good morning and welcome back to first mover. Our next guest is working to address some of the common misconceptions about the world of Cryptocurrency. Joining us now to discuss is the author of the new book, Digital Money Demystified, Go From Cash to Crypto Safely Legally and confidently, Tanya Evans, welcome to the show, Tanya. Hi Jen, how are you? Thank you for having me. I'm great. I think it sounds like Lawrence is great too. Thanks for being with us. Hi, I'm here. Hi, good to see you. You as well. All right, we want to talk about your book in just a moment, but we have to talk about this excitement around the spot, Bitcoin ETF and subsequently a potential spot Ether ETF that we learned about this morning. What do you make of these developments? First of all, the coverage earlier was fantastic. So congratulations to you all for and Nick and everyone for keeping their finger on the pulse as a and in the spirit of full disclosure because I think gray scale is in the mix. I'm also a recent board member for uh DC G. So just putting that out there. But the recent news that has been reported about the S ECs talks with gray scale investments and uh the coverage that you were mentioning about Blackrock. The conversion, first of all, the conversion of G BT C for gray scale, but Blackrock entering the uh entering the chat, that's a really big deal. It's a watershed moment clearly for the crypto industry, we can watch the prices as it, it legitimizes the space for so much of the institutional money on the sidelines. Uh the anticipated approval, not only of, of Bitcoin ETF S but the reporting yesterday regarding Black Rock and and Ethereum spot ETF S that clearly could and it seems like it has led to more bullish sentiment. Uh Obviously, this could also be in reaction to the natural ebb and flow of bull and bear cycles. But I think that it reflects um increased investor confidence, broader accessibility to digital assets without, you know, kind of deris the area for those who won't be into cold storage wallets, but do want some exposure to this market. Uh This is all happening in the context of the post 2022 contagion clean up. Uh we appear to be at the end of that. So, um and, and finally, just on the heels of a, a Bitcoin having event in 2024 there's so much focused on positive momentum in the space. So I think it's an exciting time. I want to draw on your legal background. Now, I asked the same question to Kenny in our last segment. Is it possible the SEC doesn't approve the spot, Bitcoin ETF and all of the wind is just taken out of our sales. I just don't see a world where that happens, particularly given the, the fights that, that the SEC led by Gary Ginzler, uh fell, they uh fell with respect to the uh arguments against having it just never made sense. Uh Practically speaking, uh to have futures, ETF s but not the underlying asset. Uh And so the, the court ruling, the federal court ruling that the S ECs decisions were arbitrary and capricious, meaning without merit without foundation is the signal. I think that the industry needed and clearly, uh that the SEC needed to move forward to, uh probably, uh now, I don't know, I don't, I'm not, I'm just kind of reading the tea leaves to probably have them all done at the same time. Uh I think you mentioned that in the earlier block as well and I agree but to have a futures, uh ETF and not a spot, never made any sense. And the court agreed. But is this more of the sec sort of throwing its hands up in the air and saying, look, we don't care anymore like we're, we're just done fighting this here and we don't care anymore. You can all rot and here you go suffer with this ETF good luck. Everyone hope, you know, don't let the door hit you on the way out. Um, there's gonna be a little bit of that. There's a little bit of that. But, I mean, does that affect, does that affect sort of any kind of enthusiasm into it? Uh, if you're an investor and you go, you know what, the only reason the SEC is approving this is because uh these guys fought in court forever and it's not like it was a major victory, but it's a, it's an arm twisting the sec into approving it. And why would I want to trust something like this uh between that and let's face it. The major trials that happened over the past 18 months and are and are still going on the Doans of the world, Sam Ban and Freed and all these faces of crypto that institutional investors might look at it and say, OK, fine, you know what? You get a 1% you get like half a percent of our portfolio. Sure. Just, just to say we're in it. Uh w which is not small, but it's not the future of finance necessarily here. I think you're gonna see quite a bit of that, quite frankly, you're always gonna see. Um you know, shout out to first mover um pun intended but not intended, first mover advantage for some uh to kind of take on the headwinds to kind of see what happens. There will be institutions that absolutely move forward. There will be those who sit on the sidelines with their, you know, arms crossed saying Harumph not, you know, not on my watch. Uh the market will decide the market always does. And when you have hundreds of of um customers calling, when you have legal and financial professionals left to figure out what to do and realizing that they need to avoid irrelevance and possibly malpractice at this time. It will be those um professionals and it will be clients who dictate what is offered ultimately. But I think there will be some cautious uh enthusiasm and also a lot of cautious hand wringing and arm crossing to not go over this finish line. But the time, you know, time will tell. Um All right, Tanya, let's uh Lawrence says his arms crossed there. Let's let's change gears to your book that digital money demystified. You really set out to explain this industry in plain English to allow uh I think one of your motivations is to allow anyone to invest safely legally. Is it possible to operate in this industry right now? At least from a US perspective safely and legally without clear legislation, I think it's a, it's a fair question. And so the best way that people can position themselves is to at least separate fact from fiction. This is not an easy space when you think of even how you know, the first cryptographically secured asset Bitcoin back in January of 2009 kind of came on the scene with the gangster lean. Uh This was largely the purview of technologists, largely the purview of those who already had a financial background. But as we start to get closer to mass adoption, most people at this point in time, when they first enter, they're not going to fully invest or appreciate cold storage, They're not going to trust themselves because there's a huge mindset shift from trusting other people before yourself with your assets. So that takes some time. But we do wanna have people participate in this emerging and nascent asset class because with great risk is also great opportunity as a small part of an overall portfolio. And so that's what I want to empower traditional investors to at least understand what the top 10 or so. Um myths are in the space and then right size them, demystify them. Oftentimes there's a kernel of truth in everything. One of the myths is uh volatility. It's not that this asset class or the ecosystem is not volatile. We saw some incredible volatility on news of the potential approval of spot ETF S for example, uh but volatility isn't a bad thing. So in my research, I kind of comparing and contrasting other uh times in history where you have a new asset class, you have uh uh stocks, you have futures, um you have all kind of swaps and things like that. There's a lot of volatility until to your point, you have the settling around more settled norms and laws to give people clarity. But I think at the, at the investor level, the the writing is already on the wall about participation. It's just how to do so prudently and that comes from having more information so that you can make the choices. We have, we have very limited amount of time. You mentioned. One of the myths out of 10 give us some uh three others. I don't wanna, don't give away the whole star because people need to buy, right? So uh three other myths that, that you uh you see here, one of the big ones and I know that you all hear this a lot as well, particularly with the headlines that crypto is only for criminals, which is closely aligned uh aligned with all crypto. And I'm using air quotes for those who are just listening is a scam. We have over 3035 maybe 40,000 different types of native assets, coins or tokens in circulation. And that's not even including non fungible tokens. So I think it's a lazy approach to just say, oh, it's all a scam or only for criminals. When we see companies like chain Alice is working very closely with the Department of Justice here in the United States. Uh Crypto Forensics or block. I should say Blockchain forensics makes uh Blockchain uh assets really bad for criminals. It might be quick on the front end, not great on the back end. So those are a couple. And finally just that it's only for a certain demographic, this idea of the crypto, bro, when you, you see so many women, at least cautiously optimistic, you see black and brown communities, queer community taking a second look. And so just broadening the conversation around who this is for and, and the power and the promise right size with the pitfalls. Well, I've learned the hard way. Don't talk about crypto bros, particularly on, on Twitter. They get very, they're already coming for me. They get very sensitive. Makes three of us spicy. All right, Tanya, thank you so much for joining the show and congratulations on the launch of the book. Thanks so much. That was digital, money demystified author, Tanya Evans.

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