Polymarket Founder & Beast Games Champion 7/23/25

0:00Bring in show music please. Hi, I'm CNBC producer Katie Kramer. Today on Squawk Pod. Betting clearinghouse Polymarket is everywhere with predictions on local elections and even the fate of the KissCam CEO. The platform that lets users wager on what might happen is one step closer to re-entering the U.S. market. Founder Shane Copland joins us. What's the difference between you and Calci? Polymarket is Polymarket and they're a Polymarket copycat. How Mr. Beast Built an Empire, the number one subscribed channel on YouTube, branded chocolate, and a$5 billion valuation, CEO Jeff Housenbold on working with the Beast himself.

0:41We just clicked, and we had a shared vision of how to create the next generation of Disney, a diversified media and entertainment empire. Plus, Beast Games champion Jeffrey Allen. You won this whole thing, 1 ,000 contestants. Crazy. 10 million bucks. 10 million. And the rest of today's stories that got us squawking. Eamon Javers has the latest on a trade deal with Japan. Does this sound like a bespoke deal, or is this something you think we're going to start to see across the board? I mean, it's right in range with the other deals. The soaring cost of powering the biggest grid in the U.S. and big tech's talent wars.

1:18You don't hear about talent getting poached from other places. Is that because they're really good to their employees, or is that because nobody wants their employees? It's Wednesday, July 23rd. Squawk Pod begins right now. Stand Becky by in three, two, one. Cue it, please. Good morning, everybody. Welcome to Squawk Box right here on CNBC. We're live from the NASDAQ market site in Times Square. I'm Becky Quick along with Andrew Ross Sorkin. Joe is out today. Let's get straight to it. President Trump striking a big trade deal with Japan. And Eamon Javers joins us right now with more and all of the latest.

1:55Good morning. Yeah, good morning to you, Andrew. We don't have a lot of details here from the White House, but we do have a statement that we got overnight from Japanese Prime Minister Ishiba talking about this deal. He says if necessary, he's going to speak with President Trump or meet with him in person, but he's going to review the details of the deal. He said this is going to lead to both countries being able to cooperate and create jobs, produce great products and fulfill various roles in the international community. And here's the statement that the president put out on Truth Social yesterday, offering what we know of the details of this trade deal so far.

2:30The president saying we just completed a massive deal with Japan, perhaps the largest deal ever made. Japan will invest, at my direction,$550 billion into the United States, which will receive 90 percent of the profits. Put a pin on that for a second. This deal will create hundreds of thousands of jobs. There's never been anything like it. perhaps most importantly, Japan will open their country to trade, including cars and trucks, rice and certain other agricultural products and other things. Japan will pay reciprocal tariffs to the United States of 15 percent. This is a very exciting time for the U.S.

3:02of A, and especially for the fact that we will continue to always have a great relationship with the country of Japan. That from the president of the United States. So the question here, Andrew, is, you know, what are those profits from the deal and how are those 90 percent profits going to go to the United States is the president suggesting some kind of fund or some other mechanism whereby the U.S. can profit from trade directly. So we'll wait for the White House to provide a little bit more detail. But this comes on the back of a day where we also had trade deals with the Philippines, a trade deal with Indonesia, or at least framework of a deal with Indonesia, all points to a world where tariffs are higher than they had been certainly in January, significantly higher, but less than the president had threatened.

3:48That 15 percent for Japan, Andrew, is lower than the 25 percent that he threatened that country with just a short time before. So the president's negotiating style pretty clear here. What he wants is higher tariffs, and that's what he's getting, guys. Back over to you. I want to go back to the 550, and I want to go back to the cars, because we could probably look at some car makers. Just a second. We're going to do that just, okay. We're going to hold off on just looking at some of the stocks for a second but in terms of the 550 piece what's the possibility that that is effectively the collection from 15 percent yeah that's interesting that that is the way the president thinks that could be what he's talking about there um you know we're gonna have just gonna have to get more clarity from uh from the president uh in terms of from the white house in terms of what he's talking about there or if that's some other sidecar deal regarding investment buying products, that sort of thing.

4:42You know, that has often been done in these trade deals in the past, where you announce some large agricultural purchases over time, something like that. So we'll wait and see what the White House has to say. And to the extent that you can forecast slash speculate about the future, does this model or is this a model for other countries? If you were to look at the kind of deal in India could strike or others could strike, Like, does this sound like a bespoke deal? Or is this something you think we're going to start to see across the board? I mean, it's right in range with the other deals, right?

5:20I mean, it seems like each of these is individually negotiated with the countries in question. But you're looking at 19, 15, somewhere in there in terms of a percent tariff. That's what the president's focused on. And then opening up access for U.S. goods to that market. you know, we'll see what opportunities now exist for U.S. exporters in some of these markets. You know, what can U.S. manufacturers sell to Japan, Indonesia and the Philippines that they couldn't do, you know, earlier this week? That's an open question, I think, for manufacturers to see what the size of that opportunity really is when you look at what those markets traditionally need and buy and what the U.S.

6:04traditionally makes and sells. But I think, yeah, it is a template in the sense that you're ending up with tariffs in the teens and some sort of lowering of tariffs on the U.S. and opportunity for ag and other purchases. Okay. Eamon, we will be back to you, I'm sure, as we sort through what is a complicated transaction. Thank you. And Andrew, to your point about what it means in the markets, we showed you where U.S. equities are this morning. They are up across the board with the Dow up by about 235 points. But stocks were up even more in Japan on this news. In fact, the Nikkei was up by 300 by three and a half percent.

6:42Japanese carmakers also soaring on this. You've got to look through one by one because this is a really big deal for all of them. Toyota up by 14 percent. Honda was up by 11 percent. Nissan up by 8.25 percent, and then Mazda up by more than 17.5 percent. And then just in anticipation of what might come next, you had Germany's top car makers also rising in the morning trade. Across the board, you see Porsche up by 7.3 percent, Volkswagen up by 6.5 percent, BMW and Mercedes each up by more than 5 percent. All of this happening on the expectation that maybe a deal can be cut for the EU that includes some of these automakers, too.

7:24That was the big news, the auto tariffs coming down pretty significantly. Yesterday, President Trump teased a possible trade deal with the EU coming just in the next few days, and the markets are getting ahead of that based on the success with this deal with Japan. We've gotten some new developments in the war for top AI engineers. The information now reporting that Meta has hired three researchers from Google's DeepMind initiative, bringing the total that Mark Zuckerberg's company has poached to at least six people. A Google spokesperson saying the company continues to attract, quote, the world's leading AI talent, including researchers and engineers who come from rival labs.

8:02Meanwhile, a person familiar with all this recruiting telling CNBC that Microsoft has hired about two dozen employees from DeepMind in recent months. The move coming as AI talent poaching has ramped up with OpenAI's Sam Altman saying that Meta has now offered employees$100 million in terms of signing bonuses to jump ship. And we've heard of numbers that are even higher than that. $300 million over several years. I think what's so interesting about this is when you get to, what's the peak for this? Are we at peak? Is it going to get longer from here? How long does it take to get more talent kind of fed into this AI pipeline on these things?

8:43How many of the, you know, when you talk to some of the leaders of these companies, they're like, there's 200 of these people. Right. And that's it. And the question is, why is that? And what is the magic here? I don't know. How long does it take to ramp this up? And then the other thing I always think is you don't hear about talent getting poached from other places. Is that because they're really good to their employees or is that because nobody wants their employees? Nobody's coming. You mean? There's a few companies I can think of where you haven't really heard big poaching stories that have come through.

9:12Companies, I would say like an Amazon, you haven't heard big stories of that. Is that because Amazon's so good and holds on to them so tightly? Or is it because nobody's kind of coming there looking for their talent to steal? No, I think the truth is the people that we're talking about are just the people involved in the large language models. And Amazon doesn't have, I mean, look. They're paying some big bucks, too. No, I know. No, but I'm saying Amazon, unfortunately for Amazon, they don't have, they were never on the frontier. So, right, Apple. You're saying they don't have anybody that anybody cares that much about.

9:41For this particular talent, right, this is like a, you know, you're like a chemist who somehow understands how to weight certain things over other things. And part of it is actually you're stealing the experience that they have of making mistakes earlier. And so, you know, what actually works and what doesn't. And taking some of their teams with it, too. Most of the people who are trying to create large language models are struggling when they're doing it on their own because you have to basically start from scratch. And so that's part of what's happening. So, yes, an Amazon, unfortunately for an Amazon, yes, they've done certain types of AI and machine learning.

10:17But it's a different, I think it's a totally different business. But who am I to say? I don't know. Meantime, now to one of the effects of all this AI computing and research prices from the biggest U.S. power auction jumping above the record high level just seen a year ago. That could put tens of millions of homes from Washington, D.C. to Ohio at risk of a big increase in electricity prices next year. The capacity auction numbers were released by North America's largest power grid operator, PJM Interconnected. Now, big tech's demand for power is butting up against roughly a decade of shrinking power supplies with PJM and many power projects now stuck in limbo thanks to lawsuits and permitting problems.

11:01Some key energy stocks rising in pre-market trading on this news. And you know what? So I don't know how much you focused on this. I am I'm convinced that there are so many governors who are trying to bring data centers to their state. And five years from now, they are going to say to themselves, boy, do I wish that we had never done this. Because what it effectively does is raise the price of electricity. For your customers. For your own customers. Because what's happening is. I should say for your consumers. For your own residents. Because what's happening is the data center gets built. The deal that any data center is making with the energy supplier says, by the way, you need to keep us up and running 99.999 % of the time, which means the energy goes to me first, meaning data center first, before it goes to the customers.

11:53And watch when there's a hurricane or there's some kind of terrible incident. And by the way, the power is working for the data center, but is not working in your home. Or your hospital. Or your hospital. you are going to see, I think, wild sort of social unrest, or at least questions about how this is all working. By the way, that's not to even discuss where the water is. I was going to say, the New York Times has been writing about the water usage, that it sucks up too. But can you even do that in a heavily regulated industry? I mean, if that's the case and how some of these contracts are written, I wonder if regulators will come back and say, no, no, you can't do this.

12:29That's why states like Texas, by the way, it absolutely can work that way. And that's why people are going to certain states where there's more of an interest in allowing that kind of thing to take place. Some of these guys are not even attaching themselves to the grid. I mean, that's the other part of this. So they have their own power supply with literally no connection to the grid. And so when they're on, I mean, their lights will be on and your lights will be off. That's because there's no way to even capture that. Well, not in Texas, but in most states, the regulators have to sign off on how much you can raise power prices.

13:04Yes, but that's why. Oh, yes. On raising power prices. Right. Sure. But what's to say if you just run out? What's to say we don't have power for you because we've made an agreement over here that you get the power exclusively first? That's what the deals are. That's going to be a pushback. Cheese will be next. Coming up, Polymarket, the world's largest prediction market, exploded in popularity during the 2024 presidential election with billions of dollars of trades on the platform. It is now one step closer to actually legally operating in the U.S. with a$112 million acquisition of QCX. It's an exchange and a clearinghouse.

13:44You know, that lets us go and serve brokerages and FCMs as well as retail and institutions. Stay tuned. Squawk Pod will be right back.

13:56This is Squawk Pod. Up in Andrew, Q. You're watching Squawk Box on CNBC. I'm Andrew Ross Sorkin along with Becky Quick. Joe is off today. CNBC is learning that Goldman Sachs and Bank of New York Mellon have joined forces to create the ability for institutional investors to purchase tokenized money market funds. Now, BNY clients will be able to invest in money market funds whose ownership will be recorded on Goldman's blockchain platform. Some massive money managers, including BlackRock and Fidelity, have already signed up for the project. Goldman and BNY believe that tokenizing the$7.1 trillion money market industry is the next leap forward for digital assets.

14:35Tokenized money market funds pay owners a yield, making it more attractive to place a place for hedge fund, pension funds and other companies to park their cash. Now, BNY Mellon telling CNBC the tokenizing step is important because it enables seamless and efficient transactions without the friction that happens in traditional markets. We're about to talk to a guy who probably is focused on a little bit of all this tokenizing stuff that's going on. Polymarket returning to the United States, the online betting platform announcing on Monday it's acquiring a derivatives exchange called QCX. The price tag is$112 million.

15:09And joining us right now in an exclusive interview about it all is Polymarket founder and CEO Shane Copeland. Good morning to you, sir. Thank you guys for having me. Round two. Round two. You're back here in the U.S. This has been the dream. Long time coming. So let's go backwards. You've been operating. We talk about Polymarket as if everybody can use it. But the truth is that most folks couldn't because you had to be in Europe. For trading. I mean, I think the way you guys talk about Polymarket has kind of become the Bloomberg terminal for reality, almost. And it's awesome. I'm humbled that every time I tune in a Squawk Box, you're like, well, Polymarket.

15:48I was watching Eric Adams' episode, and the first thing he said is, well, the Polymarket for this. And I was just like, I'm from New York. I went to high school right here. And the mayor talking about our site is just incredible. But yeah, I mean, look, there's a ton of latent demand for people who want to participate in the markets, not just look at it. So for us, you know, where we sit, it was like a must have. And so what happens now? So obviously, I think people are pretty surprised. It was like a big acquisition. And the simple way to put it is it's kind of the perfect asset. So it's an exchange and a clearinghouse.

16:25And, you know, that lets us go and serve brokerages and FCMs as well as retail and institutions. It's really important. they all know and love Polymarket. When I get to meet these people, they say, oh, my God, Polymarket's amazing, but I wish we could trade on Polymarket. And, you know, ask and you shall receive, right? So how much does this compete with Calci? That Calci is probably your biggest competitor, at least in the United States. Yeah. I mean, look, it's been this crazy journey where prediction markets, Polymarket has become this cultural phenomenon. And I would say that I'm I'm very grateful and very lucky that people have looked at Polymerca's success internationally and said, OK, how can we just copy and emulate this as much as possible in the U.S.?

17:07And that was a very arduous journey. And now it's kind of been paved out. So what it makes it for us is like, hey, we can go buy this asset. And there's precedent for how to do these things. And we're going to be able to get in very quickly. Do you get know-how with this acquisition, too? Kind of understanding of those markets? Yes. I mean, look, we made a hire. Neil Kumar, our CLO, who's ex-CFTC, ex-Wilkey, excellent domain expert on this. And yeah, the folks at QCEX, one of the best parts of it is that they're derivatives OGs. And, you know, a lot of the time when we're making strategic decisions, we'll talk to them about it.

17:46Derivatives OGs. That's good. It's a different lane, right? I think the polymarket at its core, it's consumer, it's culture. That's what drives us. But we also are nerds about market structure. And, you know, if we really want to go and dominate the market like we can, because, you know, you guys talk about polymarket all the time. We say the polymarket for this. And it's just caught on. You know, we need to go and be able to serve the markets. Let me ask you a question long term. If you have the success that you want, I assume there's going to be a lot more competition. And I'm assuming that competition comes from the following places.

18:22I'm assuming the sports betting universe decides, you know what, we've got this massive funnel. We've got people who are already betting on sports every single night. They've got their credit card. They've got all their accounts there. We're going to get into this business ourself. Right. That's one end of it. There's probably the Wall Street end of it, which is the traders who are going to be doing this in another way. And then there's, I'm assuming there's probably five other ways that other people will get into this business. Does that mean that you ultimately license some of what you're doing to other people?

18:55Does that mean that you get acquired by one of these people? Does that mean that you buy somebody else? What does this actually look like in success? It's a great question. I mean, look, you can draw a lot of parallels from how, say, interest rate swaps matured, or say how the stock market matured over the past century plus. The way that I think about it is, you know, you look at sportsbooks, for example, or you look at these like consumer trading apps. They're not exchanges. They're not marketplaces. They're front ends for existing infrastructure. For sportsbooks, it's sort of this commodity business, and you have the odds and you take the other side, and it's basically subject to the innovator's dilemma right now where they take these huge margins, and now there's a better way to do it with things like Polymarket.

19:38the way that I think about it is there's a different type of user behavior that is the itch is scratched for with Polymarket. And that's this idea that you have an opinion on things and you're curious about what's going to happen in the future. And, you know, you think I think you're wrong and I'm right. So, you know, I want to put up or shut up. Right. And when we think about product, that's what we want to build as opposed to some sort of hyper financialized app. And I do think that there'll be maybe some cannibalization if these are powered B2B, or maybe there's some element of, you know, there's probably going to be more competition as the revenues heat up and the market's larger.

20:11But we're really just focused on delivering on product. And the final thing I'd say is, like, if you look at the numbers, I don't know if you guys have seen, like, Polymarket's gotten pretty damn big in terms of usage, distribution, brand. And I think, you know, you look at some of these other companies that have maybe a billion dollar marketing budget or near it. And you look at Polymarket, which is just this scrappy team that just is always trying to do things guerrilla and, you know, figuring out shrewd workarounds to go and get distribution. And what's really exciting about Polymarket is because it's not so hyper-financialized, people share the screenshots all the time.

20:46People go and it's word of mouth. Like, you know, I tune in and I hear you guys talking about it. That's incredible for us. And, you know, you guys talk about what's the craziest bet you've seen so far. I mean, I saw the speculation about a divorce between Barack Obama and Michelle Obama. What's the wildest thing that you've seen on the platform? Yeah, I mean, some of these Middle East markets where it's like you're kind of anxious about what's going to happen. And from people who are in the open source intelligence community, they go and say, hey, Polymer gets before where we get our leads. Like it moves quicker.

21:20And to me, that's just one of the things that inspired me most when I was, before I started Polymarket, was this thing called the policy analysis markets, which was funded by DARPA. And it was all about using decision markets, which is like a deviation or, you know, a derivative of prediction markets to go and forecast what's going to happen in the Middle East. And the idea that we've been able to build up the market infrastructure and the critical mass to be able to have that in real life effectively is just mind boggling. Has it worked? The bets in the Middle East situations there have been predicted accurately?

21:52You know, when it happens, you see people, you see an influx of people in the countries where it's relevant to in customer service queries, right? It's like, you know, someone tells me, oh, Polymer is blowing up in this Telegram chat for this community. Because a lot of people want peace of mind or they're anxious and they want to know what's going to happen. That's why they tune into the news. That's why they tune into X. And now that there's this other data point, which is the Polymer for whatever the topic is, They get to see, oh, this is how likely it is. And it's updating in perpetuity. So instead of just reloading a news feed, you can go in there and see what Polymarket's saying day after day.

22:26Shane, let me ask you this. There was a report on Coindesk that you guys are weighing launching your own stablecoin. Is that true? I don't know how that stuff gets out. You know, we were really, Polymarket is kind of the killer app of stablecoins because it's this global free market. And it wouldn't be possible without a blockchain and a stablecoin. And we were the first thing built on USDC. All the USDC people are incredible. And it's been awesome to just watch them completely kill it in the public market. And I would just say we started with this older version of USDC. And, you know, we now have these longer term markets and there's a lot more usage.

23:07And it's very important that the onboarding is smooth. It's very important that we can have yield. And there's a lot more infrastructure maturation of that space. So we're exploring. Definitely have some calls and meetings lined up to talk to folks about it. But the big thing is we start with user experience and we work backwards. Different question. It relates to tokenizing, though. And I don't know if anyone's done it to you yet. There's a real effort to try to start selling, to effectively tokenize private companies that are not in the public market yet. But to do it in a way that investors, not just in Europe, by the way, which has different rules, but even in the United States.

23:43Do you have a take on what's going on here? The whole idea of tokenizing everything, effectively. I mean, that's like one of my favorite ideas, right? I'm all about markets on everything. And, you know, no one's tokenized Polymarket stock. And it's kind of, it's been cool that Robinhood has sort of put their foot in the water of doing this because people were very excited. And, you know, companies are going public later, you know, at a later stage than ever. And you want people to have upside early on. And maybe that leads to more liquidity premium, et cetera. I don't know, the downstream effects.

24:16Someone else is a professional at that, not me. But I'm super excited and passionate about it, generally speaking. And then in terms of profitability, so we keep talking, there's a lot of volume on the platform. You're spending a lot of money, though, to build the platform. Yeah. What does the line and the curve look like here? Yeah, not profitable. But, you know, I think when you go and build a platform and you get strong critical mass and you get a strong network effect, that enables you, hopefully, one day, when you do monetize to make more money the first day than you would, you know. So what is the model or the models that you are contemplating?