Team Call 1
In the introductory episode of Team Call, including Bay, James, Cooper, and Steve, the team discussed new developments with Gunbot’s integration of Beaxy Exchange. Followed by a breakdown of cryptocurrency mining energy use. The team looks at potential avenues for a greener crypto industry. A planning session is kicked off to prepare the exchange for a migration to a new and improved blockchain component. The episode closes by covering the aspects of legacy financial firms that crypto still needs to overcome.
The Transcript
James Carney
Hey, what’s up, everyone? What you will hear in the coming season is the story of Beaxy exchange, as told through the day-to-day conversations of a team who is running the customer-facing side of the business.
As you well know, building a startup is a grind under the best of circumstances. We take it to the next level, though, by attempting to resurrect one that was already on life support. The question you probably still have at this point is, what the hell is Beaxy or where did Beaxy come from?
Beaxy is a U.S. registered crypto exchange based in Chicago, Illinois, which originally raised four and a half million dollars before proceeding to light it on fire in 2018.
In 2019, a new management team acquired the wreckage, burned bridges and all, before turning it all around to profitability in less than a year. This podcast unpacks some of that story while giving you a direct plug into our day-to-day operations and a pulse on what is happening across the crypto world.
Bay Abbott
So, yesterday, I hopped on a podcast with the MarketVitals team. That’s Robert, and if you don’t know a lot about them, they have been in equities, futures, options traders for 32 years, CME pit traders.
A lot of valuable content came out of that. And I spoke to them about some pretty interesting topics. They had an interesting question for me that I kind of want to get your guys’ opinion on, like, they asked about the Biden administration coming out and saying that Bitcoin mining is not good for the economy.
My take on it was kind of interesting in the sense that Bitcoin mining is not good for the environment. My take on it was okay, the environment is important, but what is the real motive behind that? Right? I think that if China, if the majority of the Bitcoin money is in China, and they’re controlling Bitcoin, then what is the real motive behind why they’re saying that? Right? So I mean, we had a talk about that. We talked about if we thought the US government was going to ban Bitcoin, we talked about Hester Pierce’s comments,
James Carney
He thought that it was like a geopolitical play by China, or by the Biden administration to sort of like to call out China indirectly, is that it?
Bay Abbott
Yeah, call them out for like environmental harm, as opposed to, you know, probably what the real agenda is, which is, you know, who controls Bitcoin, right? Especially as it rises in value that becomes even more of a front and center topic.
James Carney
It’s interesting because they always talk about weaponizing Central Bank Digital Currency like China wants to get the most popular CBDC so that they can replace the dollar as the world reserve currency. But really, whatever is being utilized the most can be weaponized in that way.
I think Bitcoin is no exception, you know.
Bay Abbott
Yeah, exactly. So that lead into, do you think the US is going to ban Bitcoin? You’ve seen comments from Ray Dalio recently about thinking that Bitcoin is going to be banned. But then you look at Hester Pierce, the former SEC chair, and she was like, No, absolutely not. You can’t put the genie back in the bottle. Right. So it was an interesting debate.
James Carney
What does Steve think about a potential banning?
Stephen Sofocleous
It’s possible. I was actually just trying to look into one act I thought was passed, but it was directly affecting the First Amendment. An outright ban would be a violation there. But there’s other things they could do like limiting exchanges, ability to hold crypto and things like that. But for the individual. I don’t, I mean, it could be taxed higher. There are things they could do to limit it, but an outright ban I think, is unlikely.
James Carney
Wasn’t somebody with Alameda or something a top donor, I think it was SBF, Sam. Yeah, he was number two. It definitely could generate some goodwill there. Are you talking about the First Amendment, Steve?
Stephen Sofocleous
There was something involving lines of code. I mean, it’s just basically equivalent to speech.
Saying that somebody couldn’t access Bitcoin would be limiting their free speech. So the federal government couldn’t make a law that says people can’t use Bitcoin in the US that would be unconstitutional but there are other things they could do. They could come to us and say, your licenses aren’t enough anymore This or that they could create a new license, you’d have to get to price people out. Like they would have options for limiting its use. Yeah, but I just don’t see an outright ban being kosher with the Supreme Court.
James Carney
Cooper, are you a Bitcoin maximalist? Do you think they’re gonna ban it? Or do you think it’s going to the moon?
Cooper Craighead
I think temporarily, maybe. I mean, I’m from Wyoming, like Wyoming five years ago had banned Bitcoin and possession and trading that completely and is now like, the most crypto-friendly state.
Even after they like kind of reverted that, I still for a while, couldn’t get an account on Coinbase. Coinbase, basically just wouldn’t open an account for anyone in Wyoming, for several years.
Bay Abbott
Oh, wow. I didn’t even know that Caitlyn long, must have really did a number up there.
Cooper Craighead
Yeah, they passed. It was initially like seven or eight pieces of like, the civic crypto-friendly legislation.
And they’ve added another dozen or so since then. That’s why Kraken is opening their bank there.
The number of companies registered in Wyoming with bitcoin or crypto or blockchain, in the name of the company went from like, two to like, a couple 1000 in a week.
James Carney
So I’m kind of new to the whole crypto scene, but Steve and Bay, and you’ve probably been around for like some of the other bull runs that happened in the past. It was interesting because I think Steve and I were talking about it yesterday, but he was essentially saying that in the last Bull Run, you didn’t see any institutions coming out and saying that Bitcoin was going to go to 400k or anywhere near Gold’s market capitalization.
And this time, this is like a unique animal of this 2020 Bull Run, which is you have people like Deutsche Bank, Goldman Sachs, JP Morgan, Citibank , analysts, at least analysts that you know, stamping their brand, on their report saying that it’s a viable possibility.
Bay Abbott
It’s interesting because that I think that happens because the money printer go brrr.
You think about gold and, is it truly finite? I mean, Elon Musk is talking about mining gold on asteroids, right? Is it is it finite? But you know, that Bitcoin, a supply of 21 million, with really only a few million in circulation becomes a lot more valuable.
James Carney
We were talking about it the other day, too. If he is going to mine gold on an asteroid, I hope it’s like a side effect. Because if you go in and mine the gold and bring it back and you just made your whole reason for going worthless, you know, you’ve like flooded the market with gold all of a sudden, and now, gold’s worthless.
Stephen Sofocleous
It’s similar to a 51% attack. You spend all the money and by the time you get there, you destroyed the value that you tried to take out, which is just a good incentive structure.
That’s why it works for proof of work. Even beyond that, the narrative was the complete opposite from Goldman Sachs. It was Bitcoin is going to zero. That it’s an environmental disaster. You know, it’s too risky. But I think that at a certain point when it started to go up, their wealthier clients really started to get an appetite.
At a certain point, are you going to do what your clients want you to do? Are you going to stay on the sideline?
Bay Abbott
Did I tell you guys about, I was doing some research on increasing our score on CoinMarketCap. That score is based on volume, liquidity, and web traffic. So it’s almost like a system that’s designed to keep the rich richer at that point.
How does a startup increase its score? From the bottom? a legitimate one.
It’s either wash trade, funnel a bunch of legitimate traffic to your website, or, you know, increase the liquidity, which could be spoofed at that point.
It doesn’t really lend itself to legitimate practices. I thought that was really interesting. It makes sense when binance owns the thing and does something favorable to themselves. But, for all the other exchanges, as the most used website, for customers to go in and check. All the information that they would need to know, you’d think it would be a little bit more objective, in that sense, right?
James Carney
To get out of the gladiator pit there on coin market cap? Yeah, for sure. And I think a lot of these people secured the top spots when there weren’t as many eyes on things like wash trading, and in front running and market manipulation.
And you know, it’s sort of like, they’re like the robber barons of like, 1900,. John Rockefeller and Cornelius Vanderbilt, and they just amass an insane market advantage that never leaves.
Bay Abbott
Cooper, I want to ask about the British pound. I think we are in the process of having some successful transactions but haven’t got one to fully process. Did we find out why?
Cooper Craighead
Not yet. Still waiting for responses from Prime Trust about that. I have a couple of other things to follow up with them about today. It’s been a hard block on the British pound for some reason, like everybody that’s attempted has gotten rejected immediately. An intermediary bank issue.
Bay Abbott
I actually have a call with Mark on Friday to talk about how we can work more closely with Wagerr.
Ongoing initiatives with the wagering team. It’s a pretty exciting project. I think that they’re doing some cool stuff and everyone loves sports, right? That’s like my whole Sunday during football season.
James Carney
For Wagerr, what are the withdrawal fees like? I mean, can you cash out relatively easily without getting destroyed on fees?
Bay Abbott
Yeah, they’re very low and you can use Beaxy to sell the Wagerr (WGR) you get as winnings and cash out easily. From Beaxy you can withdraw directly to your bank account. So it’s all a closed loop.
That all for the first episode, e\we wanted to give a look behind the curtains of Beaxy.
All the highs and lows to give an idea of what it’s like. From the point of not succeeding, to what it takes to succeed, you can see that entire transformation on a daily basis.
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