Ivan Brightly as the Super Bitcoin Bull

January 15, 2021 Keegan Francis

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Ivan Brightly as the Super Bitcoin Bull Brad Mills

Episode 32 of the Magic Internet Money Podcast is Ivan Brightly, former partner at Galaxy Digital. Galaxy is a financial service that is dedicated to promoting growth and advancement in digital assets and blockchain technologies. The two discuss Ivan’s experience with the company before leaving it in January over the course of the episode. Brad and Ivan discuss the impact and potential for centralization that Bitcoin ETFs stand to bring with them to cryptocurrency markets. The pair then debate Coinbase and whether or not it is pro or anti Bitcoin. In addition, they debate the libertarian philosophies behind Coinbase. Finally, Brad and Ivan share their lessons learned over the past few cycles and share their crypto portfolio experiences.

“Saylorization” and Cipherpunk

After exchanging pleasantries in the introduction, Brad and Ivan begin discussing what Galaxy Digital is and the CEO of the company, Mike Novogratz. Novogratz has been described as “an awesome guy, but like a raccoon” by Ben Hunt on his show Epsilon Theory. This comparison is made because Novogratz is “...just gonna keep piling over more garbage cans trying to get as much money as he possibly can”. The meaning behind this metaphor is because Novogratz is mainly in the crypto business to “make a lot of money” according to Brad and not necessarily for it’s cipherpunk philosophy.

Brad asks Ivan about his thoughts about the “Saylorization” of Bitcoin as the “investment class” enters the market and organizations like Galaxy are easing them into this. Ivan remarks that this is going to introduce influential, wealthy people taking the proverbial steering wheel away from the current market. He makes an excellent point here, as more “whales” adopt the currency Bitcoin could begin sliding away from it’s cipherpunk roots. This is how cultures and communities change, when a new, influential audience arrives. It seems reminiscent of Europeans arriving on the shores of America, however they have a choice to cooperate with the current community rather than playing a winner take-all game. Ivan also remarks that as institutions like Coinbase pick up the currency and cater to venture capitalists and other “whales”, there will be stronger pushes for government regulation as well.

While on the topic of centralization, Ivan remarks that the only concern about the government he had at Galaxy was “regulatory actions that would make it hard to trade” or that lawmakers decide “that bitcoin is just bad”. These are very real concerns and growing ones as Bitcoin continues to climb in value. In such a scenario, it would make bitcoin traders into criminals overnight, for really no good reason other than “reasons of state” or some vague reason for “security”.

The Potential of a Bitcoin ETF

Due to the arcane nature of Bitcoin and cryptocurrency, Ivan has suggested that an ETF might be a future of Bitcoin. This would be a move towards further centralization and a potential shift away from the cipherpunk values that started the currency and the culture behind it. Currently there is no Bitcoin ETF in the United States, so currently this is a theoretical discussion. Theoretical or not though, it is an important one to have.

ETFs could stand to spread the value of Bitcoin or other cryptocurrencies towards the layman or the Mom and Pop’s that aren’t necessarily prepared to learn how a transaction works down to the finest level or simply don’t have the time to do so. By rolling Bitcoin into an ETF, it could be handled in much the same way that gold has been historically, and that is something many consumers are more familiar with. Ivan discusses this in deep detail with Brad, citing much of his experience from his time as a partner with Galaxy.

No ETF? No Problem

The theorization of ETFs leads the duo into a debate about Coinbase. Brad feels that Coinbase and companies like it “work against Bitcoin”. Ivan says that Coinbase is part of what made it available and accessible to people, since, as mentioned above, not everyone can be plugged into Bitcoin and cryptocurrency. Ivan also argues that Coinbase subscribes to libertarian philosophies, as they are simply catering to market demands and they are a private company.

Brad’s position is a less centralized one, as he sounds like he’s more in the camp that Bitcoiners have the ability to trade directly peer-to-peer and don’t need to be railroaded in a centralized fashion at any rate. Brad makes a good point here, however I feel that Ivan is in the more correct camp. Given the nature of our society, not everyone has or wants the time to plug into cryptocurrency markets and can understand them as deeply as other things they’re already experts on. So long as peer-to-peer methods remain available, and they almost certainly will, the cipherpunk methods of exchange will continue to be an option. I don’t think Brad’s argument should be ignored either though. These baby steps are how things change away from cipherpunk roots in order to cater to larger, wealthier, more lucrative audiences. There’s definitely a line to be walked in this regard.