00:00:00.200Politicians and pundits all across Canada are now talking about cryptocurrency, but who is telling us the truth?
00:00:06.220We're going to try to make sense of it all today on the show. I'm Candice Malcolm and this is The Candice Malcolm Show.
00:00:21.800Hi everyone, thank you so much for tuning into the program.
00:00:24.580So as you know, I was pretty critical of last week's conservative debate in Edmonton.
00:00:29.400I didn't think it really allowed for much of an exchange of ideas.
00:00:33.000However, one of the most interesting and explosive moments of the debate happened when the candidates began criticizing and piling on Pierre Polyev for his positions about crypto.
00:00:43.860It seemed like some of the candidates didn't really understand the difference between decentralized currencies like Bitcoin versus a government centralized digital currency.
00:00:55.080And you could see that Pierre Polyev was kind of smiling because it really showed almost like a generational divide where most of the candidates, I would say five out of six, just don't really understand Bitcoin or blockchain or cryptocurrencies.
00:01:06.860And Pierre sort of has a monopoly on this topic.
00:01:10.180And so I wanted to bring in someone today to help make sense of this entire topic and help us understand what the real issue is.
00:01:17.360And so I'm very pleased today to be joined by Matt Spoke.
00:01:20.880Matt is one of the leading experts in conservative circles when it comes to cryptocurrency.
00:01:24.840He's a founder and CEO of a company called Moves, which is an all-in-one financial app that helps gig workers manage their business.
00:01:32.060Matt is based in Toronto and he's become a leading advocate for the potential social benefits of decentralized technologies in the world.
00:01:39.120He's been published in Forbes, The Hub, and other outlets.
00:01:57.340So let's just start off by asking like a very sort of basic question.
00:02:01.360For people who aren't really familiar with these terms, don't really know what we're talking about,
00:02:05.380if you could help us understand like what is blockchain, what is decentralized currency, what is crypto, and what is Bitcoin?
00:02:12.040Just give us a little overview, please.
00:02:14.380Yeah, I mean, I think without getting into the technical weeds, because you'll read a lot of stuff online that gets into language
00:02:19.800that most people will just glaze over at because it's a very technically heavy or a lot of technical jargon in this industry.
00:02:27.260I'd say broadly, the idea that sort of underpins Bitcoin and a lot of the experiments happening in the cryptocurrency space
00:02:33.180is sort of a concept of building a currency system that is detached from any central authority
00:02:38.560or detached from a central government that acts as sort of the issuing body of a currency or the layer of trust underpinning a currency.
00:02:46.280There's a technology that underpins a lot of these currencies that sort of broadly become known as blockchain technology.
00:02:52.080It is important to understand that this is sort of like it's not all of these currencies are not equal.
00:02:57.400There are some currencies that have been around and proven the resilience for a lot longer.
00:03:00.960There are some that are a lot more experimental.
00:03:03.120You'll hear lots of negative sort of skeptics in the media that will point to the examples of some of the more,
00:03:09.920you know, some of the more, the big news items of frauds and scams and Ponzi schemes and others
00:03:15.600to try to distract people from sort of like what is the underlying technology and what's its potential?
00:03:21.160I think broadly, I like to think about this as like as people lose confidence in their governments,
00:03:26.360not necessarily, you know, their government's ability to to to maintain sovereignty over their countries,
00:03:32.220but just their government's ability to make good decisions, good decisions as it relates to monetary policy.
00:03:36.900We're now being given a choice as to are there other assets that we can flee into?
00:03:42.440And I'd say particularly Bitcoin has proven itself quite resilient and almost it's almost on a level playing field of a lot of national currencies.
00:03:48.500If you if you were a resident of Venezuela, you know, Bitcoin would be a very attractive currency for you.
00:03:52.940So there's lots of debate around whether that translates to Canadians and whether that translates to Americans and other Western countries.
00:03:58.300But I think there is something to be paying attention to.
00:04:01.440And I think the risk that the conservatives, you know, last week really started to show is you want to be careful to not position yourself as sort of the party of the neophytes like that.
00:04:09.980Anything that you don't understand and anything that is new, you automatically take a negative tone towards it.
00:04:15.140And I think Chiara is definitely standing out as somebody who at least, you know, not only has an open mind,
00:04:19.140I think he actually very fundamentally understands what's going on in this space.
00:04:23.040But anyways, we can get into it in more depth.
00:04:24.640But that'd be my word of caution is like if you don't understand something, it's better to not have an opinion than a strong opinion against it.
00:04:30.100So, yeah, well, and also just to make sure that the points you making are clear, because there's obviously a big difference between a decentralized currency.
00:04:38.180We could talk about some of the pros and cons about those like versus what the governments are trying to do, which is roll out their own sort of version of digital currency.
00:04:46.140So we'll definitely talk about government's version of digital currency.
00:04:49.340But I do want to ask you because, you know, you said if you live in a country like Venezuela, it might be better to use Bitcoin as opposed to the centralized currency.
00:04:56.540Well, as we've seen this month, the price of Bitcoin has plunged its lowest since 2020.
00:05:00.640According to New York Times, more than $300 billion of Coinbase was wiped out in a crash in crypto prices.
00:05:07.000Look, I've been following Bitcoin for maybe about 10 years.
00:05:10.240And I remember back in like 2015, people were saying, oh, Bitcoin's over.
00:05:15.340It's done. And there's definitely been ups and downs and it's been a wild ride.
00:05:19.540But but there does seem to be sort of a fundamental instability when it comes to the value.
00:05:25.440So I'm wondering if you could help clarify, like why you think it could be a better alternative to a government managed government monopoly, you know, of just a regular currency that we that we've had for the last 50, 50 years or so.
00:05:40.140Yeah. And I mean, I think it's worth being clear here.
00:05:42.340And this has probably been lost in the shuffle as it relates to the conservative leadership race.
00:05:46.340I don't think anybody is suggesting that we drop the Canadian dollar and I'll start paying for our groceries in Bitcoin.
00:05:51.340I don't think that that's in the cards today.
00:05:53.340I don't think that that's in the cards for the foreseeable future, maybe ever.
00:05:56.340I think what Bitcoin is introducing to the world is a new form of asset that can exist within a portfolio of assets similar to gold historically as assets are discovered by the market.
00:06:08.540Their prices can be extremely volatile, right?
00:06:11.140So this is a this is an asset that by global sort of penetration metrics is only scraping under 5% of people in the world that have actually touched or held a Bitcoin or held a fraction of a Bitcoin.
00:06:23.740We're very much in the early days of global adoption.
00:06:26.540And as people discover the asset in some periods that will lead to very high volatility and upward price momentum and as markets sort of correct, that can lead to very aggressive volatility downwards.
00:06:36.740I think anybody interacting with the space needs to go in eyes wide open and consider that there is a lot of risk when assets, newer assets like this can be volatile for a long time.
00:06:46.740I think what's to sort of decouple the conversation is to like, what is the price of Bitcoin today? What was it last week? Was it last year versus what does the long term potential of this new type of currency design represent in the future?
00:06:58.940We should be thinking about policy from the perspective of like the next decades, not the next month.
00:07:04.940And I think we've seen a lot of this sort of distraction from, you know, I got an email from Patrick Brand's campaign last week talking about, oh, you know, if you would listen to Pierre Polyeb, you would have put all of your dollars into Bitcoin and lost 50% of your dollars.
00:07:15.94050% of your life savings. Nobody is advocating for that right now. So it's really like the long term potential. When you go from 5% adoption to 30% adoption to 50% adoption, all of a sudden the volatility associated with this asset will change quite a bit.
00:07:28.940It's also worth noting that while the markets for Bitcoin have corrected aggressively, so have the markets for every other regulated traditional asset in the world. I mean, the price of stock on Netflix and Shopify and all these other companies are also feeling a lot of pressure as the market's correct.
00:07:42.940And I would say that the cause of a lot of that is actually government monetary policy. I mean, it's the amount of money that we've inflated and put into the system that effectively fueled this huge run up in the stock markets that had sort of a trickle down effect into the crypto markets.
00:07:56.940And now all of a sudden, governments are starting to pull back on their money printing. They're starting to sort of revisit their quantitative easing policies. And then they're turning around and blaming the crypto markets for volatility. You know, it's a little bit of an unfair assessment when you consider sort of where all this money originally came from over the last two years.
00:08:14.020Right. And just to go back to Patrick Brown, sort of straw man, it's like, you know, with any investment strategy, you're not gonna put all your eggs in one basket, right? Like you're even even if you're playing if you're putting money in the stock market in a mutual fund or an index fund, it's like you're going to put some money in, you know, energy stocks and money in tech, and you're going to try to have a very diversified portfolio.
00:08:33.020And so why not include precious metals or decentralized currency? Matt, I'm really glad you mentioned inflation, because one of the things that I sort of get frustrated upon, you have, you know, Prime Minister of our country who openly admitted during the last election that he doesn't really think about monetary policy doesn't really care. You know, he did go on to say that, you know, what he thinks about his families and how they can afford things, but how can you decouple those, those two, the line from the administration, which is parroted by the legacy media, is that inflation is just caused by globalization.
00:09:03.020Global forces, and it has nothing to do with monetary policy, nothing to do with the Bank of Canada, nothing to do with the debt that Justin Trudeau has acquired during the pandemic. And so I'm wondering if you could if you could sort of comment and help us understand the connection between monetary policy, how the government spends and and the printing of money with inflation and and sort of help help clarify that issue a little bit.
00:09:27.020Yeah, I think, you know, I'm not, I won't pretend to be an economist or somebody who's got, you know, a deep, deep background in monetary policy. But but I think, you know, the really the basics in my mind, are that we we live within a system of fiat currency, which effectively means governments can decide through their central banks, but also through their own, their own fiscal policy, how much, how much debt they want to take on how much money they want in the economy.
00:09:51.020And generally, the money that we have in our wallets are in our bank accounts is all just backed by our level of confidence in our government's ability to repay that debt. So we're effectively sitting on IOUs that we call Canadian dollars, these are IOUs that somebody will honor the value of that dollar when it comes time for me to actually withdraw it from my account and spend it in the economy.
00:10:10.020As, as the proportion of how much of these IOUs sort of exist, this is, you know, as central banks inflate the currency supply, the level of confidence sort of decreases over time. And, you know, we don't see the huge negative consequences, the way that you might in economies where there is more hyper inflationary environments, but, you know, we're on a slippery slope towards a set of Western, you know, what historically would have been stable economies that have gone probably a few steps too far.
00:10:39.020And overusing this lever, you know, it's easy to point to the world's average inflation and say, hey, it's not our fault. It's really the world is going down this, this, this path.
00:10:48.020But I think it really points to the fact that most Western economies are suffering from the exact same, the same illness, it's governments that don't know how to constrain themselves as governments that would rather spend and be responsible and think about sort of the future impacts of their decisions.
00:11:02.020You know, Bitcoin in this context is really interesting to me because it sort of brings us back to a conversation around a sort of hard money standard, you know, before the 1970s, the world existed on a gold standard for the most part.
00:11:17.020And the gold standard effectively restrained government's ability to decide unilaterally how much money they wanted to put into their economies because their money in theory was backed by physical reserves of gold.
00:11:27.020And, you know, I think it was the Nixon administration that sort of started pushing away from this in the 1970s, but because they wanted to spend more than they had in their reserves.
00:11:36.020And naturally, there was a tendency and then every government around the world that had sort of pegged themselves to the US dollar, which was quite common after World War Two, all of a sudden had to decouple their pegs from the US dollar and all start moving towards this sort of fiat standard.
00:11:48.020And it started this, this, this very quick path towards government debt being a norm.
00:11:54.020And I think there are scenarios when government debt is totally appropriate, but when it becomes sort of like our, our, our modus operandi, we don't know how to operate without debt.
00:12:02.020I think it leads to, to, to potentially a slippery slope that we're going to start feeling the consequences of in our generation, maybe not our parents' generations, but yeah.
00:12:10.020Well, Canada's lived through it, right?
00:12:12.020Like anyone who's familiar with the financial situation I've studied a little bit in the nineties, Canada couldn't find anyone to buy our debt.
00:12:18.020And the New York, the Wall Street Journal infamously called Canada, the Canadian dollar, the Northern peso, and, and said we were basically an honorary part of the third world.
00:12:27.020And it basically caused the liberal governments under John Crouchet and his finance minister, Paul Martin, had to drastically, drastically, drastically reduce the size of government.
00:12:37.020So we've, we've been there as a country, we've learned that lesson, seen the norm was heading back towards fiscal responsibility and balanced budgets until Justin Trudeau rolled around and, and really did something unprecedented with the amount of, of spending.
00:12:54.020I did, I did want to ask you a little bit about the politics on the conservative side, because Pierre Polyev was getting sort of attacked from all sides on during the debate last, last week.
00:13:04.020Uh, there, you know, there's two components of it that were interesting to me.
00:13:07.020One lesson Lewis's attack sort of fell flat because she didn't really seem to understand the difference between, uh, like I said, the decentralized currency and a government digital currency.
00:13:16.020Um, but, but, but, but there is some truth to the attack that Patrick Brown was saying because Pierre, uh, at a campaign stop in London, Ontario, back in March, uh, he said that Bitcoin lets Canadians opt out of inflation.
00:13:27.020Uh, Canadians need more financial freedom.
00:13:30.020He said that the government has ruined the Canadian dollar, so Canadians should have the financial freedom to use other money such as Bitcoin.
00:13:36.020Canadians need less financial control for politicians and bankers and more financial freedom for the people.
00:13:42.020Uh, obviously, you know, like we mentioned, the price of Bitcoin has gone down pretty tremendously.
00:13:47.020Um, so I, I'm, I'm, I'm wondering what you think of the lines of attack, uh, Pierre's, uh, line there about, uh, opting out of inflation.
00:13:55.020Um, do you, do you think, do you think Pierre's onto something or do you think he was being a little reckless with that comment?
00:14:00.020Um, I mean, I don't think he was being reckless.
00:14:02.020I think he's trying to make a point that requires a little bit of exaggeration to say, uh, you know, I, I, I think the, his, his, uh, his critics will, will obviously jump to the most extreme interpretation of what he was trying to say.
00:14:13.020And this is what his opponents in the conservative race had been sort of accusing him of is suggesting that we should all be fleeing away from the Canadian dollar towards Bitcoin.
00:14:20.020Um, which I don't think is what he intends.
00:14:22.020I mean, I, I, in fact, I know it's not what he intends to say when he talks about this.
00:14:25.020I think he's talking about a design of a monetary system that is worth, uh, us having an open mind to it's worth us as a country, encouraging our citizens to be more educated on and, and, and, and frankly, designing policies that don't penalize people if they want to, uh, be exposed in this market.
00:14:40.020And then, you know, at that, that, that stop in London that you're referencing in particular, that's one of the business is a business that as an example decided, you know, the last couple of years to shift some of its balance sheet from Canadian dollars into Bitcoin as an example.
00:14:53.020Um, you know, I think we're, we're Pierre's message really resonates with me is that a lot of this comes down to individual choice.
00:14:59.020Uh, you know, what, what national currencies represent effectively is a monopoly on how we, how we decide to spend money and how we decide to save money.
00:15:07.020And so you, you know, historically you've been sort of locked into your national economy from the perspective of like, even if you live in a country where you really don't trust the monetary policy, you have no choice to hold your life savings in that, in that reserve currency.
00:15:18.020Uh, your bank accounts will only hold that currency.
00:15:20.020Your, the stores in your local city will only accept that currency.
00:15:23.020Um, and you're sort of trapped if all of a sudden you feel like your government is going in a direction that you disagree with.
00:15:28.020There's not a very easy path to call it exit your national economy.
00:15:32.020Uh, I think Bitcoin definitely, and, and, and some of these other cryptocurrency experiments that are, that are popping up, they represent a potential choice for customers.
00:15:41.020It doesn't mean that they, they automatically go and replace our, our dependence on a Canadian dollar.
00:15:45.020Uh, but to your point earlier, I think this, it's a very reasonable thing to say that people's portfolios could have some exposure to the space.
00:15:51.020I think that exposure should, should, um, should match the risk profile, right?
00:15:56.020So the risk profile of this industry is still quite high.
00:15:58.020Uh, you know, so maybe that means that people hold 1% of their assets in Bitcoin, you know, nobody's suggesting that you go put a hundred percent of your assets into this volatile asset class.
00:16:07.020Uh, but it will continue to evolve and continue to grow and continue to represent a larger and larger percentage of the global economy.
00:16:13.020And I, I fundamentally believe that that's true.
00:16:14.020It's not a matter of, of if, but when, and these little moments of volatility that they were experiencing.
00:16:19.020I mean, the best thing that I like to do is I sort of like to say to people zoom out, you know, on a month to month basis, it might look very volatile.
00:16:25.020But if you look at a trajectory, if you look at a trend line that sort of averages out the prices over a two year historic trend line, it's, it's been a very, very good, well-performing asset over its life.
00:16:35.020You know, it's maybe a 13 year old asset or something around there.
00:16:38.020And, you know, two years out, if you average out the price movements over two year periods, it is consistently performed.
00:16:44.020And, and this is why less than 5% of the world actually owns Bitcoin.
00:16:48.020I tell people who have a better understanding of sort of how gold fits into the global economy.
00:16:52.020Like imagine if the world was just first discovering gold, you know, what would be the, the reaction to people if they started realizing that there's this asset that people care about.
00:17:01.020We would see huge volatility in gold markets.
00:17:03.020The only reason we don't is because gold has sort of established itself as a normal asset over hundreds and hundreds of years.
00:17:08.020Bitcoin is just on its way up towards, you know, a similar status, I would say.
00:17:12.020And, you know, my, my big bet in this space that I've been very bullish on for a long time is that Bitcoin will probably overtake the markets for gold in the next five to 10 years and could become a new gold standard like asset.
00:17:23.020That doesn't mean that national governments are going to flee to Bitcoin.
00:17:26.020I think there is a need to have your own monetary policy in your country, but there's also a need to constrain government's ability to just spend recklessly and print money recklessly.
00:17:34.020And hopefully this introduces a balance.
00:17:37.020Well, and it's interesting, just historically, whenever there's a recession, I don't know if we're in a recession or heading towards a recession, it seems like that's the direction we're going.
00:17:46.020It seems like there's always a lot of panic and people sell, which is the worst idea when an asset goes down, whether it's a stock market or Bitcoin, like don't sell, hold and see what happens.
00:17:55.020That's sort of the advice that I seem to think is the best from financial advisors I listen to and talk to.
00:18:01.020I want to I want to touch on this idea of the difference between Bitcoin and a central bank digital currency.
00:18:08.020You tweeted in response to Pierre Paliev if Bitcoin represents monetary freedom, the central bank digital currency represents monetary surveillance and control.
00:18:18.020So, Matt, what is the risk of a Bank of Canada creating its own competing digital currency?
00:18:23.020I think there's probably two big themes here.
00:18:27.020One one is more a theme of just like modernizing and bringing technology into our monetary system, which I think generally speaking, we should all be in favor of a lot of the rails and payment systems that we rely on as a country are quite antiquated.
00:18:40.020You know, they were built decades and decades ago and they lead to a lot of inefficiencies in our banking system.
00:18:45.020This is what you experience as a consumer.
00:18:47.020If you want to transfer money to somebody else's account and there's a two day delay or anything along those lines sort of represents these inefficiencies that still exist in our banking in our banking system.
00:18:56.020So I think if the conversation is should we be modernizing and bringing technology into our monetary system that I think, you know, we should all be encouraging of that.
00:19:05.020I think the risk is that what digital currencies represent is effectively a new vehicle to replace cash.
00:19:11.020And what cash is fundamentally is an anonymous way to transact.
00:19:17.020And I think it's extremely important in a country that sort of prioritizes freedom that we maintain the ability for our citizens to transact anonymously.
00:19:28.020I mean, you can imagine, you know, the dystopian view of every time you go buy a pack of cigarettes, your insurance company finds out about it and your premiums go up because you're now you represent a higher health risk or whatever.
00:19:40.020Right. So, you know, probably more recent examples around what what happened with the trucker convoys in Ottawa and across the country over the last couple of months.
00:19:49.020The ability for governments to sort of step in and freeze bank accounts and sort of interfere with what is to, you know, adults wanting to transact with each other in what ended up being lawful, you know, in lawful circumstances.
00:20:04.020And so I think what I worry about is that governments will not stop at modernizing and using technology to make our systems more efficient.
00:20:14.020They will realize that this technology provides them new tools and new levers that they haven't previously had.
00:20:18.020The government today could not theoretically freeze a hundred dollar bill sitting in your wallet.
00:20:23.020But if it's a digital hundred dollar bill that they've issued to you, then all of a sudden they can theoretically freeze it.
00:20:27.020Sarah, this move away from cash towards digital cash effectively controlled and managed by a central bank, but with significant influence from a government.
00:20:37.020I think it should be cause for skepticism.
00:20:40.020I think there are ways to have technology without censorship.
00:20:44.020I think it probably needs to be something that gets discussed in terms of policy and legislation where we think about this very carefully before we rush to implement anything.
00:20:54.020I mean, the best anecdote I can sort of say around why I'm cautious about this is that the first government to do this at scale in the world is the Bank of China.
00:21:04.020So you ask yourself why the Bank of China rushed down the path of building a central currency.
00:21:08.020It wasn't to provide more freedom to their people.
00:21:11.020It was to create more capital controls and to be able to effectively observe in real time what's happening in the economy from people sending money to each other on their cell phones and peer to peer payments.
00:21:21.020People buying groceries at the grocery store that control.
00:21:25.020We should be very careful before we just hand it over blindly to our government in the name of efficiency.
00:21:30.020You know, Bitcoin as an example on the, on the other end of the spectrum is again, more of a representation of something analogous to gold, but with, with easier ability to transfer it and send it to each other.
00:21:43.020Cause you don't have to carry around heavy gold bricks in your wallet.
00:21:46.020A government could not change the supply of gold.
00:21:49.020They could not decide that the gold you own in your, your home safe is no longer valid.
00:21:54.020You know, so it has characteristics that, that, that keep it valuable irrespective of the government of the day.
00:22:00.020Um, and I think that, you know, it's important that we have that option in, in, in, you know, in the world.
00:22:06.020So I don't think it's a one or the other.
00:22:07.020I think if we're going to go down the path of digital digitizing our, our, our monetary systems, uh, we need to be very, very thoughtful before we rush down that path.
00:22:15.020Well, I'm glad you brought up the trucker convoy and the seizing of bank accounts, because that was probably one of the most terrifying things that has happened, uh, so, so far this year, so far in this administration.
00:22:25.020And I think it really raised a lot of concerns, not just in conservative circles in Canada, uh, but in technology circles and people all over the world were sort of like, okay, this could be a potential roadmap for authoritarian and totalitarian regimes.
00:22:39.020One of the things that finance minister Christia Freeland said was that they were also going to be cracking down on Bitcoin and Ethereum and NFTs and, and, and these other sort of decentralized modes.
00:22:50.020Do you think that the Canadian government has that power?
00:23:07.020I, before I answer that, I'll say that anybody should be concerned about what happened at the trucker convoy.
00:23:12.020Not, not simply whether or not you agreed with, with that group and that protest and, and, and whether you support the current government or not.
00:23:18.020I think the idea that any government in power, whether it be liberal, conservative, NDP, whatever, uh, has the, the, the authority and the levers to, um, to silence their, their critics and their opponents.
00:23:31.020Uh, if it were a conservative government and this were a, a protest, uh, uh, on, on, on a progressive issue against a, a, you know, pro let's say Stephen Harper was still in office.
00:23:40.020You wouldn't want Stephen Harper to have the ability to do what, what Justin Trudeau did during that, during that time.
00:23:45.020So I think we really need to approach these things, you know, with a nonpartisan lens that this is just a lever of control that if we hand this to government, it is impossible to pull it back.
00:23:55.020Um, and we need to be very, very careful about that.
00:23:57.020And, and, and, and I think, you know, some people will sort of speak to this being, you know, a step towards conspiracy theories, but it's just, you know, once you hand the lever over, you're never getting it back.
00:24:06.020And so, uh, as it relates to Christian Freeland's comments, I mean, I do think they're concerning.
00:24:10.020I think there's still highlights in my mind that there's a giant misunderstanding around what this technology is and how it works and what it represents.
00:24:17.020Um, even the language being used, not only by, by Christian Freeland, but also by some candidates on the, in the conservative race today.
00:24:22.020Elizabeth Lewis would be a good example as they speak about it.
00:24:25.020And you, they, they have a choice of words when they're describing it.
00:24:28.020You can tell that they have a very significant lack of understanding.
00:24:30.020Um, you know, it, it is a little bit, um, contradictory.
00:24:34.020What Christopher Phelan is suggesting, but the government does have the ability to make this industry, um, uh, suffer through frictions that it otherwise wouldn't have to suffer through.
00:24:44.020I mean, there are regulatory boundaries around this industry.
00:24:47.020If you want to be able to interact with a Bitcoin exchange and connect your bank account or, or open an account with, uh, you know, most of these exchanges in the Canadian context have something analogous to sort of know your client and it's money laundering process.
00:24:59.020That is, that is regulated by either provincial or federal government regulators, depending on context.
00:25:04.020Uh, the Ontario Securities Commission and its sort of counterparts across the country are quite heavily involved in this space.
00:25:09.020Um, the government can make this industry's life more difficult.
00:25:13.020Uh, it cannot wish away the existence of this industry.
00:25:16.020And so I, I think where, where we run a risk as a country is if we tighten our grip too much, we're, we're effectively pushing people to countries that are more open-minded and welcoming to the innovation that's happening in this space.
00:25:27.020And, and over the long-term Canada will just be, uh, on the losing side of that, of that bet.
00:25:32.020And, you know, this innovation is happening.
00:25:34.020We've already seen flights of capital flights of talent to countries that have been more receptive and open-minded.
00:25:41.020And I think there is a way to balance, uh, an openness to innovation with some protections and regulations and sort of some baseline rules, uh, that the industry should be expected to adhere to.
00:25:52.020Um, but to try to, to, to pretend that you can sort of put the genie back in the bottle, uh, I think is, is naive and is going to lead to some really bad policy decisions.
00:26:14.020Someone told me there's a hundred thousand Canadians that live just in the Bay Area.
00:26:17.020And there were a lot of Canadian events.
00:26:19.020And to me, it almost struck me as a little sad that so many Canadians leave Canada, uh, to go to the Silicon Valley.
00:26:25.020And I know this phenomenon happens, uh, you know, in Hollywood and music and in finance, like in New York is also full of Canadians working on wall street, but you know, I, I, I, I wish Canada did more to retain that talent and to, uh, promote at home.
00:26:39.020You wrote a great piece, uh, over in the hub where you talked about Canada needs a new infectious variant of entrepreneurship.
00:26:46.020Uh, so I'm, I'm wondering, just final question for you here.
00:26:49.020Um, what, what can Canada do to, uh, keep more entrepreneurs, to attract more entrepreneurs, to encourage more Canadians to become entrepreneurs?
00:26:58.020Like what is Canada doing wrong and how can we create a better environment to, to, to keep these kind of tech people that, that, that tend to leave and, and go, you know, create businesses and make their millions elsewhere?
00:27:09.020I mean, I, I think without getting into sort of like policy prescriptions, you know, Christopher Freeland's comments on Bitcoin is a good example in my mind.
00:27:15.020Like what, what exists in Silicon Valley that doesn't exist in many other places in the world is, is, is an, is an openness to sort of the, the, the crazy idea.
00:27:23.020The, the, the person who's sitting in the coffee shop talking about something that in most contexts, people would roll their eyes at this person and say, listen to that crazy person talking about this idea.
00:27:32.020In Silicon Valley, that's the norm, right?
00:27:34.020You, you're, everybody is expected to be thinking outside of the box is expecting to be talking about ideas that are so far fetched today.
00:27:40.020Uh, but ultimately lead to the, the big breakthroughs and innovations that we, that come to become normal 10 years later, 20 years later.
00:27:47.020Right. And, uh, whether that's the internet in the 1980s and 1990s, whether that's cryptocurrencies and Bitcoin, you know, in the, in the last decade, you know, imagine listening to the person who was going to describe, uh, the Airbnb business to you before Airbnb became normal.
00:28:01.020I mean, in, in, in, in Canada, we would have sort of laughed that person out of the room in Silicon Valley.
00:28:06.020That was an opportunity to bet on a contrarian idea.
00:28:09.020Um, I think we are, there's a, there's a cultural gap that, that, you know, we can, we can solve for by effectively encouraging more people that think this way to, to add, to congregate, right?
00:28:20.020Like there's a concentration of people like this, there's a density of, of outside of the box thinkers in Silicon Valley.
00:28:26.020That means that the moment you say a crazy idea, you're not automatically discouraged.
00:28:30.020You're sort of your people are saying, Oh, no way. Yeah. Tell me how you would do that. Like, and, and, and it sort of pushes you down that path.
00:28:36.020It's supposed to pushing you to sort of like reconsidering your crazy idea and going for something, maybe a little bit more reasonable and tame.
00:28:42.020Uh, the best businesses of the last, you know, 20 years were not reasonable in their ambitions.
00:28:46.020They were, they were, they were very crazy ideas in their time.
00:28:49.020Um, and I, I think as a country, we need to be much more open to things that we don't understand.
00:28:55.020We need to, we need to give the default assumption to entrepreneurs that what they're, what they're talking about and what they're working on is valid and worth pursuing.
00:29:03.020Um, and, you know, all this to say that most entrepreneurs fail, most business ideas turn out to not be valid or, or not be successful, but it's in the process of allowing sort of a thousand experiments to happen.
00:29:15.020That one really world-changing breakthrough sort of pops through.
00:29:18.020But if, if you're squashing these ideas before they have a chance to blossom, then that'll never happen.
00:29:23.020And so, um, you know, the government tends to approach this more from a perspective of like, how can we throw money at, you know, more government funded incubators and, and innovation programs and super clusters.
00:29:32.020And, but ultimately it doesn't change this.
00:29:34.020Like, you know, are we receptive to new ideas?
00:29:37.020Are we receptive to people that are, that are going to go against the grain, uh, to create sort of new norms in the future?
00:29:43.020Well, if anything, it sort of bogs down entrepreneurs because they end up having to fill out government forms to try to apply for certain innovation grants and, and, and it doesn't really lead them in the direction of, of true entrepreneurship.
00:29:55.020Well, Matt, we really appreciate your time.
00:29:57.020Thank you so much for joining us on the show and giving the great explanations that you did.
00:30:01.020And I, I love your sort of optimistic entrepreneurship, uh, spirit.
00:30:05.020I hope that that, uh, that, that, that spreads and that there's more, much, much, much more of that in Canada.
00:30:10.020I really appreciate you coming on the show today.