E154: Bitcoin Suisse CEO: How to Build Generational Wealth in the Next 5 Years

32:24Check the description down below to participate in the Mantle Global Hackathon and make a difference. What's your view on banks? Personal view on banks. For example, I haven't had probably more than 500 bucks on a traditional bank account in the last 10 years. I moved to London in 2015 and then it was the beginning of Revolut and Monzo. And so I was like, this is so good. Why would I have money on my bank account, right? And now I'm at the next level where I live on stable coins. I think most people are not at that level yet, obviously. But I just, that's basically a cast. Just spend your stable coins.

33:11I never need to get - Card looks good, actually. Card looks great. Gold card. Yeah, super fancy. So with this, but there's a bunch of others, right? I mean, the business is run on stable coins. My life pretty much run on stable coins and I can just, with Apple Pay, spend my stable coins. I don't even need to use a Monzo or Revolut anymore, right? So I'm kind of like extreme, but not because I'm like, oh, fuck the banks. It's just like you find something better. You just use it, right? What's your view on banks? Especially you said Switzerland is built on freaking banks, right? I agree. And these banks, they're basically done.

33:47If you think about maybe not now, but like new generations. I think the days are counted. I mean, obviously large banks, let's say the larger 10 % of the banks, they will survive. They have enough capital, maybe even 20 % but all the smaller ones they live basically from capital that they have from let's say former generations but now the new generations are taking over they have different interests in terms of asset classes they can invest in credit cards like e-banking and all those like kind of nitty-gritty details but they matter because you want those kind of features and having Revolut for example as a benchmark I mean it's a great tool also use Revolut for like international transactions to convert money and so on as a travel card so it's difficult for a lot of the banks to keep up with this kind of service offering or actually product offering rather than service offering the service itself is even getting less important because somebody that takes over the wealth of let's say their parents i mean they're not that interested to know now the personal relationship manager that might be 65 and retires in a year right i mean I mean, yeah, why would I?

34:58I'm interested in different kind of elements. And if the bank cannot provide it, it's pretty easy to move capital nowadays. So I'm not really bound or very loyal to this kind of bank. So that's why I think a lot of the banks will die out or consolidate or be absorbed by some larger banks over the next 10, 15 years for sure. Do you feel like your Swiss mindset has prevented you from achieving much more in life?

35:28a little bit cynical but um yeah i mean the swiss mindset i think we we quickly talked about that so the swiss mindset has certainly prevented us from growing faster because we organically grew in the early days we tried to grow very conservatively through retained earnings through doing it slowly and so on we didn't go out and do a crazy fundraising trend try to hyperscale five six seven years of burn rate and then try to become profitable so we did it the opposite way seven years seven years of retained earnings not getting a salary i mean not for seven years but for a few years for sure injecting capital into the firm but that's what we did and why i'm not so negative about it is because it's probably a reason why we're still around we could have also died because we have seen so many companies in the last like 12 years popping up like mushrooms in the forest but yeah who is still around it's it's exactly the same that like started those those many years ago i remember three years ago four years ago 2021 when there was this cd5 wave right the log phi and celsius and all these guys it was amazing you could just take your crypto and earn yield yeah and i remember i don't remember who told me that but i remember someone was saying I know these guys at Bitcoin Suisse and they're saying that what Celsius is doing is impossible mathematically right and I was a big Celsius believer I was a early token holder I was an investor in the round A which a year later on the equity we had like 20 or 30x right before it blew up obviously so obviously I wanted to believe that what Celsius was doing was possible right but then I remember I don't remember but someone was saying, these guys at Bitcoin Swiss, they've been here since 2013.

37:23Boring guys. This boring guy. I was thinking, I'm Swiss. I'm like, this boring, these boring dudes. Don't be a party pooper. They say that these yields are not sustainable and not possible. Like this 5 % on Bitcoin or whatever, 8 % on stable coins. And fast forward four years later, Bitcoin Swiss is still alive. and thriving and Celsius went bankrupt and screwed a lot of people. My family included who got sued in Switzerland. No way. Got how do we say that? When they send you the paper at home with the stamp of like the Swiss

38:07lawyers. Very fucked up situation. Anyway, you were the boring guys who said that the yields were not sustainable and who were right. Who was laughing now no i mean the thing is i know those days very well so it was the usual kind of hype times where everybody's like overwhelmed and overexcited about all the new stuff that is happening so i i've seen it so many different times i came into the industry because of bitcoin and all of a sudden ethereum happened and something else later all the icos i was always more excited about that so i can even understand this rational but zooming a little bit out and coming back to the entrepreneurial real story is kind of being conservative.

38:49I mean, we obviously always assessed all those trends if it was like Celsius. And I mean, we also traded with FTX and all of that. So we knew those platforms very well, but we have been confronted by a lot of clients saying, hey, this platform pays me such a high yield or their custody fee is lower and so on. But I mean, at the end of the day, what does it matter if you say five basis points here and your money is gone the next day or if if a platform is like paying 10 staking rewards on bitcoin i mean how does that work so obviously you need to enter some sort of a risk in order to pay those kind of um of interest rates to to clients the same like on the staking side if if ethereum is paying like five percent on the on the network and somebody offers 10 then they do some shenanigans on top of that right but how do you explain that to your clients i mean our clients are primarily interested in in in having a long-term partner so in having somehow the safe bet so a lot of them they made their money on platforms or tokens or whatever but at one point they want the safe place on the custody side they want somebody that understands staking where they can allocate the funds to where somebody that has a dedicated team to outperform the benchmarks on a regular basis.

40:08But that also has, I mean, even best execution. Our standard offering sounds pretty boring because we're a broker. So we do not really compete with the exchanges, but we use all the exchanges. And the clients benefit from better prices and best execution at the end of the day while having a Swiss counterpart and not an exchange somewhere in the Bahamas, right? Yeah, I was having this conversation with Anthony, the co-founder of SwissBorg. and he was saying when there was this DeFi yield craze we had this new offering and after a few months we had 1.5 billion under asset just on this yield thing and then the other competitors they came with higher yields and then the whole thing melted to 300 million dollars just because people were chasing these yields and we had to make the decision internally to not compete because we knew it was not possible then he said one of the main reasons we didn't do it is because we didn't have investors.

41:05If you have VCs, I mean, they had the ICO investors, but if you have VC that didn't say, the competitor that I'm also invested in, they're doing that. So you do that, right? And they probably would have died otherwise, right? So there is a good side of doing things the Swiss way. So it's not all negative, but you're right. It can hinder you in terms of growth and doing it the American way on the other side, yeah, it's sometimes good, especially in crypto, to do it slow and conservative. You said before Bitcoin, Bitcoin and Bitcoin. Bitcoin Swiss. Bitcoin Swiss. Bitcoin for the next five, ten years.

41:48It's almost becoming too consensus. Like Bitcoin is going to go to a million dollars. Like, hey, I remember when Bitcoin was 3K and we kind of, if you understood Bitcoin, you knew it would go to 100k. Now we're well past 100k and probably going to go to a million dollars. But maybe not. What's the main risk with Bitcoin today? I mean, there is a couple of risks like in the industry for sure. But I rather see, let's say the upside, but of course you also need to understand the risks in the industry. So you have, I mean, the original idea of Bitcoin is about decentralization. What you see nowadays is some sort of centralization with large custodians where all the ETF funds are lying around or very dominant counterparties in the industry, digital assets, treasury strategies that are growing, which are all good in a sense, but all of them lead to some sort of centralization of the ecosystem.

42:50So I see this potentially as a risk, but I think the industry can deal with it. but if something major happens to any of those platforms of course that could lead to a major collapse as well that will not just bring bitcoin down but also the whole industry but overall again i try to see the glass half full usually so um yeah i rather think about opportunities in the industry but of course you need to understand risks first bitcoin suis you're the co-founder and CEO of Bitcoin Swiss what is Bitcoin Swiss if you had to explain it to your mom because this is a financial institution that is focusing on crypto assets primarily offering access to them safeguarding them and then offering a lot of additional services on top of that you started early with a key differentiation from other exchanges out there You said a physical office, a phone number and Switzerland.

43:54The combination makes it. You're telling me that in 2014, Bitcoin exchanges didn't have offices and there was no one to call. They had offices, but usually they were hidden on some sort of a tower without any name on the doorbell or on the postbox. Definitely no phone number. So for us, it was not a groundbreaking idea, but it was certainly a differentiator that we were not like hiding behind the platform, but that we were stepping in and saying, hey, this is our office, come to our office, meet us, have a conversation, learn more about crypto, purchase crypto, do whatever you want. I mean, there was this kind of entry hurdle that we tried to actually embrace interested people and handhold them on their journeys within the crypto space.

44:44And of course, the phone number helped. to stay alive. You guys have 6 billion in asset under management now. How big do you think that number would be if you had gone all in on the hyper-growth train that some other businesses or international ones went on 10 years ago? Could have been higher, but could also be now zero. So the chances that we would have disappeared in exactly that game would have been substantially higher. So not just that, we probably, the problem is also with like hyperscaling and we did it a couple of times where you like hire every month, there's like 20, 30 people new starting in the company and you need to train them and educate them and so on.

45:30But over time, not everybody has like the same kind of mindset. They fit equally well into the culture. They can absorb all this kind of hyper growth. They can live with that. you need to keep up with systems automations and all of that so having some sort of a plateau at one point to really take some breath and focus on like improving the basis as well and getting more more hardcore the inner work things i think is extremely important so if you're just focusing on scaling you probably also miss out on the very basics of your firm if it's like culture if it's people management if it's like system improvements at one point it's just too much do you have any regrets

46:14as I said before Bitcoin was last valued I think five years ago over 300 million Swiss franc which looks like the classic 10 years overnight success but let's talk about the reality you told me the other day when we talked there were 20 plus moments where you considered shutting down or selling the company that's much more interesting than the headlines of hey these guys are so successful they raise so much money they're worth that much right they're smart kids tell me about two times you got the closest to pulling the plug or selling the first time was probably i don't know two three months after we started so So because the main founder, I mean, we all did it like part time.

47:09So we all had our like kind of side jobs or normal jobs. The main founder with his salary, he paid the other two guys, Fabian and myself, on an hourly basis. And the idea was that we work for the company like half a day per week. But we started to slowly increase and started to work all of a sudden seven days a week. So economically at one point it didn't make sense anymore that his entire salary is eroded away by by us working so hard and then the company was theoretically broke after after a few months and and she decided hey guys let's let's close the shop it doesn't make sense like that and and the next day fabian and myself we came back that hey we're also like working for free here we don't do it for the money we believe in the potential of what we're building for the future we believe in the industry and we love what we're doing already after a couple of months so we then all became actually partners in the firm or like co-founders in that sense and we decided hey if we want to do this we need to do it for real so we need to dedicate more time into it we need to reduce the capacity on the other jobs and then we started to go all in on the firm.

48:18What's another time maybe more recent? I mean there is constantly like a lot of of attacks like like from the industry I mean in the earlier days regulation was difficult to deal with because when we started nobody really knew how to treat Bitcoin legally is it like money is it a commodity what is it I mean we had legal paper saying that it's like nothing it's certainly not money right so why would you deal about regulation but we still became self-regulated in 2014 but that was like a lot of of discussions around those topics we as an industry were faster than let's say the regulators but also let's say the lawmakers and that's led to a lot of challenges on the other side for example dealing with banks stratify institutions and try to make your life difficult another threat is like all of a sudden competition that is coming in the early days we had a monopoly at one point like more and more players started to appear then um like like of Of course, also cyber criminals try to attack you with like DDoS attacks and whatnot, trying to attack your clients at the end of the day.

49:27All of those things you need to factor in. And as you mentioned before, you always try, you cannot be happy with yourself. You always need to improve and get better and get better. What's the origin behind the name Bitcoin Swiss? There's a cool story there. um so as i mentioned so the the main founder nicholas he was working at at credit swiss and in the earlier days so he tried to actually create some sort of a crypto trading place within credit swiss but you can imagine 2011 12 he didn't have too many supporters of that idea so he decided to do it on on the side and that's how we then met in the early days and yeah i think the original idea was Credit Suisse.

50:13Like, yeah, let's do something with Bitcoin, create Bitcoin Suisse. But yeah, it's not that good of an example anymore. I mean, Credit Suisse is gone. Look at the irony. It's crazy. He literally, so Niklas, literally working for Credit Suisse, trying to build a Bitcoin trading infrastructure internally or crypto trading infrastructure. They say no. Maybe they should have done it. And fast forward 13 years later, Credit Suisse is gone It's gone Multi Multi Multi billion dollar bank Bitcoin Suisse is thriving Bitcoin and crypto Are thriving It's pretty insane It's pretty insane Maybe That is when shift happens So we're living the moment Well done Thanks Actually that's the reason why We call the Basically Shit happens all the time right but shift is happening like there is a mega shift happening the reason why there is a when is because I mean you you know it you build companies like finding a name that where you can get for example the podcast name on YouTube on Spotify or the website name is actually harder so shift happens or shift happens all taken right yeah when shift happens it was unique but I like the name it's good because it's exciting time that we're in and it's spot on Absolutely.

51:39If you're on the right side of the story. Of the shift. Of the shift, absolutely. Or if you don't miss the shift. I think that's another big risk that we're having now. I don't think that people are understanding the magnitude and the importance of the decisions we need to do today in order to be around tomorrow or have freedom tomorrow. Very, very true. And you mentioned, again, Switzerland, these big banks, these private banks where all these kind of older families, they keep all their wealth, often in pure cash. because they're older people, they don't want even stock market volatility. And they don't realize this shift or wealth transfer that they basically are getting debased like crazy, 12, 15 % a year, right?

52:22With the asset price inflation, the hurdle rate. And it's all going into new asset classes like Bitcoin and crypto. And these people are becoming the new wealthy. And there's a mega shift happening. And if you're not paying attention to that, well, good luck the problem is it's difficult to pay attention for the average person out there and the bigger masses because Switzerland but I think in the whole western world we grow up in a system that tells you you need to work your entire life and you can retire with 65 or even later you will have a good life because you have some sort of savings on the side you have a pension fund and all of that this concept I think is outdated, completely outdated The pension fund system is a Ponzi scheme at the end of the day.

53:09If you have less kind of people that are growing in a society, less birth rates are coming down. If you have longevity and people are getting older and older, it's very difficult to maintain this kind of system. Yeah, and the same is like this fantasy construct that you need to work your entire life in order to then have the freedom. if you're still alive and healthy, the moment you retire, I think it's outdated and it's stupid. We have other possibilities nowadays to leave the system and to opt out into something new. Quick one. I want to thank our partners who help us make this show possible.

53:50Thank you, Trezor. My favorite cold wallet to store my crypto and make sure I sleep well at night. If you want to order a Trezor wallet and sleep well at night too, you can use my promo code WSH10 to get a 10 % discount. Big thank you to Bitwise Asset Management for backing today's conversation. Bitwise is a crypto specialist asset manager with more than$15 billion in client assets across 30 plus crypto solutions, including ETFs, index funds, alpha strategies, staking, and more. However you like to invest in crypto, Bitwise has something for you. Thank you to our friends at SWE for supporting this show.

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54:39Tell me more about this. So you said it's outdated? Yeah. What? Indated or new dated? For someone who is 25, 30, 35, our age, doesn't really, I mean, understand that things are, asset price is going crazy. It's very hard to even buy a house. okay, I make decent money. What should I do? What should they do? How should they view retirement in 2025, 2026, for the next five, 10 years? What should they focus on instead of like what we're being told to focus on? I think first of all, don't bet or hope for retirement in terms of like the government will do magic asset management for you and you will have enough money that you will have a decent life when you retire.

55:28and second start to take your own destiny into your own hands. You'll start to get financially literate in terms of you need to understand what is happening around you. And I told you at the beginning I was studying centralized financial systems at the university but I had no clue about financial crisis and all of that. Only the last couple of years actually while studying Bitcoin I started to understand the big picture how the world is really working. so bitcoin forced me to understand how money works how all the different dots are connected and that was an extremely valuable lesson but it took me many years to understand the full picture so starting with that now and understanding what is actually at stake is extremely important because if you just think ah this is not really relevant and will definitely not happen to me right it will happen to all the others then that's a very difficult situation to be in because you completely neglect the importance of the current situation.

56:25So you need to act now by building up the relevant knowledge and understanding of how the dots are connected and then making your own bets. It's basically the difference between Keynesian economics that we've been taught at school and Austrian economics that gold people understood a long time ago and that Bitcoiners understood when Bitcoin started. And there's an amazing book called The Bitcoin Standard by Seyfani Namus. That's really good. I read late 2018, early 2019, and that people now are talking about this great debasement trade. That's why gold is going crazy. Bitcoin is doing decent. I mean, actually, if you look at the chart of Bitcoin, I think yearly, since 2009 or 2010, and now it's like literally insane.

57:14And there was a chart the other day I saw. You see S &P 500 in dollar terms. going up. Amazing. 2009, I made 6, 7, 8x, right? I'm getting rich. You're not. Then you divide S &P 500 by gold. Eh, pretty much zero. You divide by Bitcoin, you're getting destroyed. And it's showing a completely different picture on like people don't understand this, right? So also if you have your money invested into fixed income instruments, bonds and all of that, if you get some sort of like 4 % or 5 % on it, I mean, if you factor in the inflation rate and the reduced purchasing power, it's a very bad deal. And when I was in high school, I was living under the impression that if you have enough money on the side one day in the future, that you can live from interest rate because you have it sitting around in a bank account and you get in the passive income dream.

58:18The passive income dream. But also that, I mean, it might have been relevant back in the days, even though, even in Switzerland, Swiss franc lost purchasing power of 50 % in 50 years, 80 % in 100 years. That's quite a massive, right? It's crazy. It's crazy. For people who say this is like the strongest currency in the world. Which it is, or one of the strongest. So everything else is just shittier. The other day I was chatting a little bit like with ChatGPT and asking some sort of questions. And then it came out with the answer and said, yeah, but for countries where they have even higher inflation, US dollar is still the safe haven bet and the place to go, which is true.

58:57But on the other side, I mean, it's just comparing one failed system with another one or soon failed system. Yeah, I think the, so you said Swiss franc is down 50 % in terms of purchasing power in 50 years, 80 % in 100 years. I think the dollar is like down 98%, whatever, in like 100 plus years. When people think that this is a great currency. You see it even with Swiss francs. So it completely flipped. I remember when$1 at one point was like 125 Swiss francs. Now it's the opposite. And that was like, I don't know, 10, 15 years ago. Basically, every fiat currency goes in that direction. And if you look at the average lifespan of a fiat currency, i think it's like 25 years or so yeah i read 27 years yeah yeah something like that so it's it's a question of time until it will will change again and none of the currencies that we're using nowadays have been around for the last like 100 200 years i mean british pound sterling is probably the oldest kind of fiat currency but it's a question of time because the trend is going in a very clear direction and if you compare compare it with gold real estate now bitcoin it's a bad trade to have it long term.

1:00:10That's why Bitcoin is probably going to a million dollars and more. The question is how much is netto and what does the rest do if all the fiat currencies are going down but compared to that for sure. Absolutely, because we're measuring dollars. But no, it's possible and I mentioned it before. If you compare Bitcoin with all the other asset classes and if you look at what happens with them like fiat like bond, all of them will be suffering And also now, I mean, gold went up significantly. Bitcoin is like 8 % of gold or 10%, 8%, something like that. So also if it just matches the market cap of gold, I mean, it's a 10x from here.

1:00:51Absolutely. The higher gold goes, at least the theory is Bitcoin will catch up on gold because it's kind of digital gold at some point. The higher gold goes, the better it is for Bitcoin because the date matches. Yeah. and we are yeah in a digital environment i think there is even like benefits of of a digital currency like like bitcoin so you can travel across borders with with like a couple of words in your head and that's all your wealth if i buy gold at the bank for example a couple of kilos i mean try to travel across borders with it i mean it will be confiscated even though it's your money and you have like a piece of paper next to it it's not really portable in that sense plus it's not it's very handy as well so I think there's a lot of benefits of digital currencies especially Bitcoin in that sense not just to move money across borders and geographically but also across time so from the today to tomorrow and still maintain the purchasing power but ideally yeah have even an upside that you don't have in fear absolutely you mentioned before some people might remember Bitcoin at 5K or 3K.

1:01:58I remember well. I remember when I came across Bitcoin Swiss the first time, 2020 February or January. On the Swiss TV,

1:02:13your original visionary founder, Niklas, was on the TV. And it was a very Swiss kind of documentary where they're like, in Switzerland, we don't talk about money much. And the reporter, she was a woman. She was like... So it was basically in Jan 2020. And there was this thing called Bitcoin halving in April, I think, or May 2020. Which was supposed to kick in the next wave, right? There's this cycle every four years. I mean, now this four-year cycle might be over. Whatever. I think so, yeah. You don't think so? I would say so, yes. You would say so? Definitely. We'll talk about that just after then.

1:02:51Because this is very interesting. Tell me now, why do you think? And then we get back to the story. Okay, to the Niklas story. I mean, in the past, there was this kind of rational that the halving cycle is having an impact, of course, long term for sure. The question is now a little bit, was it really the crypto cycles or was it like the election cycles in the US or was it the overall, let's say, economical cycles that we have seen that were driving this from the beginning? But let's assume it were the halving cycles. I think nowadays with all the institutional adoption, that Bitcoin and crypto in general is much more mature and it's driven by other forces, which is global geopolitics.

1:03:32It's tweets of presidents. It can be a lot of different things, but more, let's say, on a trade-by basis and on the whole macro picture. I would actually see a tweet of presidents that is supposed to be the most powerful thing in the world. That is. Doesn't impact Bitcoin that much. It impacts the overall perception and the traders, of course, so it can lead to a lot of panic. Actually, I mean, the last couple of months, it was pretty silent and people started to like factor in a little bit that certain tweets or announcements of tariffs that didn't have like such a big impact until last Friday, where apparently some sort of a threshold has been crossed.

1:04:16And it had an impact not just on TradFi, but then certainly on the market. It's a big tweet, but it's a very short-term impact, which shows how resilient and strong at least Bitcoin is, right? 100%. Which shows that, hey, this four-year cycle might not be relevant anymore. I agree. I agree. So back to the Niklas story. January 2020, he's on the Swiss TV, and then the reporter asks, what do you do? How much do you invest every day? And he explains this Bitcoin halving thing. And he says, oh, in four months or five months, there's going to be this Bitcoin halving. So I'm investing 5K or 6K in Bitcoin and 5K or 6K in Ethereum every day.

1:05:00Then she's starting to calculate how much it is per month and multiple months. And she's like, what the fuck, right? And now 5K of Bitcoin doesn't sound a lot, right? But like back then was one or two Bitcoin every day, right? And ETH was, I don't know 50, 100 ETH every day right? So and she's like what the fuck like and so that's how I basically discovered Bitcoin Suisse with this guy who was like kind of a bit eccentric right? A little bit. And she was asking him because you know again there's this fascination for we don't talk about money but there's this fascination for money she was like how does it feel to because if you're able to buy that much it means you have a shitload of money already.

1:05:43How does it feel to have money like that? and then he was just saying, I remember like vividly, he was saying, you know, I have the same problems as everyone else. When I go home and my wife doesn't kiss me, I'm worried. Yeah, but the question is, what is the alternative? So also if you have like large capital on the side, how can you allocate it? So what do you really do with the money? And in the short term, it's completely fine to have like fiat on your bank account because it's even like also personally, it's part of the strategy. of a certain kind of balance on the side. If like shit hits the fan, everything collapses, then I have like quite interesting entry prices again.

1:06:20I usually try to buy the dip. I mean, at one point, of course, the last like two years or so or three years, at one point liquidity is out of it, of course, but you should always have some sort of a liquid buff from the side. It could be stable coins, doesn't really matter, but some sort of less volatile asset in those times to benefit from lower prices. I think that's usually a good strategy then you need to find your own kind of optimum of the different let's say levels you mentioned multiple time nicolas the visionary founder he's not there anymore since since multiple years yeah and he's the guy who guys pulled you and your other co-founder in how can a company survive and thrive without its original visionary founder i mean i would say we were three from the from the beginning so all three of us were playing together in a very special way because we were all very complimentary so complete different characters not just visually but also like like the way how we think but that was part of the success recipe because we tried to solve problems differently we had a lot of very interesting and relevant conversations where somebody came in with a different angle that at the end of the day helped us to do the right decision so the original vision was more or less let's do something in crypto and let's make provide access to crypto to the average people out there we're still fighting for that we're still fighting for adoption of crypto but we also started to like have a more clear role in the industry as a financial institution as a service provider that is focusing on proximity to clients on best in class service and best execution providing the best value for our clients long term.

1:08:05And of course, now it's about trying to find the right niche in the midst of all, let's say, the competition from mass plays like exchanges, from banks that are entering the space, from ETFs. But our sweet spot is right in the middle where it's exactly about those things where clients want to deal with somebody that understands crypto. And it's not like, yeah, going to your banker and be treated like a criminal. Somebody that understands crypto from the very beginning. somebody that has like infrastructure that's that's can do something more than just like custody of bitcoin for for like high prices somebody that can like offer best execution and limited counterparty risk with a player that has been around for many years we are recording this conversation from abu dhabi you relocated here two years ago why I had multiple reasons.

1:09:03So on one side, I was responsible for the whole client management team at Bitkonswiss at that time. And we started to think a little bit about how can we export our business model like on a more global basis. So I started to then hand over this business to my successor because it was like very operational, had up to 80 people at one point. And so I tried to become more an entrepreneur again, like I did in the early days. So I ventured then for the topic called global expansion and growing internationally. And we looked at different geographic regions on how interesting they are. And we saw Middle East and especially UAE and Abu Dhabi as extremely interesting because they had a regulatory framework pretty early on.

1:09:49and they managed to attract new businesses, new entities here. It's very international. You talk to the people here, you instantly realize the mindset. Everybody's here to work. You don't have this nine to five and work-life balance kind of discussions as you have it in Switzerland and other regions. So it was very motivating to be here. Plus, we saw it somehow as a hedge as well towards the economical situation in Europe that has its own challenges and problems so i was fascinated to build up a company under the umbrella of bitcoin swiss from the very beginning again in a new geographic region why would i be specifically um so it was part of a short list where we also looked at other jurisdictions like like hong kong for example singapore dubai i mean same uae but at one point we said i mean Asia is again on the very other side of things it's a little bit too far away we didn't really have a lot of let's say contacts or yeah relations there so it would have been even newer to us middle east we already knew a little bit we had like clients here and so on so the entry felt a little bit easier plus it was like closer logistically so yeah and it's a growing economy so I think they did a lot of the right bets focusing on regulation focusing on licenses but also attracting new businesses here even funding a lot of a lot of startups and smaller companies so i think that was a clever move you mentioned the hustler mindset versus the work-life balance but you're a hustler a born hustler how much of a difference does it make to your life be surrounded by hustlers i think matters a lot to be honest i mean if we would have had the lazy people as of day one company would probably also not be here so all of us we were working day and night so with the three of us the three like like co-founders we had a 24 7 service offering so with at the peak over 300 people we didn't have a 24 7 service offering so let that sink and i really mean it so if a client called in the middle of the night or if somebody was on vacation or I mean didn't matter we picked up the phone we picked up the phone and it was not like million trades somebody that wanted to buy bitcoin for 300 bucks we picked up the phone in the middle of the night right if somebody had a problem with one of the ATM vending machines where the paper money was stuck we sent somebody to drive like one and a half hours to some gallon to replace the paper bill and it was like a 10 swiss franc transaction so we didn't care about that right i mean maybe we should have cared about it sooner in the process about the economics behind it but for us it was important to build up a reputation and the brand and trust in the industry that's what uh is a famous quote from a white combinator do things that don't scale at the beginning that makes the whole difference yeah i agree so that was super relevant for us to to create a name and a brand in the industry and and get the trust of clients as well because you need to be here for clients and we were obsessed about clients so we were really focusing always on clients how can we improve the client experience and how can we get better and of course we were always very self-critical you mentioned that at the beginning and that's key as well because the moment you're happy with the customer service yeah you can retire it's not good anymore the Swiss branding of Bitcoin Swiss was very valuable in the beginning, but at some point became limiting.

1:13:37Why? And when did you start to realize, oh, we went from being seen as super serious in this kind of wild west industry to actually being limited because we have this Swiss branding? I mean, the Swiss branding, it was not really limiting, let's say our growth or the business potential but a little bit our mindset. It's exactly this. We're conservative. We need to do everything like super properly and so on. And still later on you figured out it could have been done even better. So I mean... That's so sweet. Yeah, it sounds so sweet. Everything needs to be perfect. Exactly. And at the end of the day you find out and often we also hired like people.

1:14:21We thought they're like experts in a certain field and we trusted them a lot. and later on we figured out, I mean, they had no clue, right? So also that you can focus as much as you want on quality, but at one point you just need common sense again. And yeah, the hustler mindset in my point of view was luckily in most of the different growth phases it was around, but yeah, the Swissness itself, it has pros and cons. Let's put it that way. The Swissness. I'm thinking about Revolut, right? Move fast and break things. Like you just go to this market and you don't fucking care and then you deal with the point.

1:14:56Or, I mean, the ultimate example is Binance. Binance, yeah, 100%. They just don't give a fuck. They just go everywhere. And then, oh, shit, lawsuit. Oh, I have to go to do some jail. I'll do my jail. Done, right? It's a complete different mindset, but it worked out. I mean, crypto today would not be the same without Binance. So what they did for the crypto industry is amazing. Of course, the way how they did it, it raises probably some questions, but still, for crypto adoption on a global scale, it's amazing and they probably will reach a billion clients one day so yeah that's real adoption what makes Bitcoin Swiss special?

1:15:36this business no I shouldn't say that no I think what makes us really truly special is the clients at the end of the day because through clients we get direct access to the industry and most of our clients they're like crypto natives so So those are the builders in the ecosystems, the ones that have created the blockchains, it's even foundations themselves. And thanks to our clients, they have very early access to new narratives, to new business cases, to new projects and so on. So we try to enable them in the early days and then grow together with them as an ecosystem. Tell me about your clients.

1:16:15I want people to understand who do you serve, who do you not serve. so we serve primarily um crypto native clients that's foundations founders co-founders of protocols it's developers investors into those like protocols but it's also the segment of threat 5 players that are trying to find their way into the crypto space so it's it's like family offices external asset managers and so on so people are counterparties that need to be embraced that need to be hand-holded on the journey towards crypto we have a lot of private clients as well the number of clients of course is dominated by private clients high networks and ultra highs but we also have like an affluent segment of clients that are willing to put like 50k into crypto 20k something like that but then they grow together with us as well as a firm but we don't really do retail anymore the type of clients that wake me up in the middle of the night to trade Bitcoin for 250 Swiss francs.

1:17:18Why do you not do retail anymore? Problem was really with retail. I mean, we grew up with retail, so the only thing that has been around when we started was retail. There were non institutional clients. So it was a sad move, but the problem is of being in Switzerland is the cost to serve clients is extremely high. We had to do KFC since day one. We have been regulated since 2014 for AML, so the onboarding in our world was similar to a bank I mean definitely now is but also in the early days so we asked for kvc original funds supporting documents and all of that while I mean in all the larger platforms you open an account with an email address and the password and and you were able to trade Bitcoin back and forth like crazy so the cost to serve them were too high and we over time had to really focus on those clients where we can provide the benefit like long term and slowly start to get rid of retail clients.

1:18:18What's the end game of Bitcoin Swiss? It's growing. It's still benefiting from this hype. I see every day a lot of problems. I'm a problem solver, so I try to solve them. I see a lot of opportunity. I try to capture them. So as long as we see there is a growth path on a global basis as well, we want to do that. We also look into M &A potentially, like buying competitors and other firms. So we really want to grow in the industry. We want to be the benchmark for best-in-class service. You're expanding globally. Have you ever thought about changing the name of the company? We did many times. We did probably as many times as we were thinking about closing the company.

1:19:04So that has been one of the running gags internally. So on one side, it's very unique. Everybody knows Bitcoin. Everybody knows Swiss. They can combine one plus one and probably understand what we're doing. But it has also been limiting us on the other side because clients started to ask, hey, do you do something else than Bitcoin? Yes, we do. We're blockchain agnostic. Are you only serving Swiss clients? No, we don't. So we try to be global. So it has pros and cons. But I think by now, the name is cool. It's unique. And yeah, it's recognizable. So we didn't want to change to something more generic like blockchain Swiss or whatever, crypto Swiss.

1:19:41What's something that you hold on to but know that you should let go of? Life? Bitcoin.

1:19:54What's Andrei's biggest flaw? That's a good question. um i'm i'm i'm pretty or i used to be pretty bad in like delegating stuff so because i was always involved in a lot of different areas in the firm i try to do stuff myself and at one point i mean your company is growing you get more responsibilities different let's say roles and titles at one point you you need to delegate and delegate and i had to learn this the hard way because at one point i was like too involved in too many different topics and then it's like very stressful so if you if you get home 10 11 in the clock in the evening and you still need to handle like 20 30 40 emails um at one point i mean talking about years here it gets uh yeah frustrating so learning how to delegate but also how to empower people was something that i learned on my entrepreneurial journey and I hope that I improved but yeah never be happy with yourself

1:20:59What do you answer to people who say never be happy with yourself that sounds like a hard or depressing life You should love yourself for sure, you should be happy with yourself as a human being, with your family and surrounding but if it's about doing a career a steep career you should not be happy you should always i mean not you should not be happy with with the results or you should always be able to like self-reflect and think about hey what did i do right what did i do wrong so you should not take yourself maybe too serious as part of that kind of journey to do self-reflection and take your learnings because the average human being has some sort of basic intelligence and you should try to avoid doing the same mistake twice and if you're an entrepreneur or if you do investments you will obviously do mistakes you will also lose money i mean i made money i lost money but it's always comes back to your self-reflection how much can you learn out of your mistakes and how can you improve long term so that's why you should maybe happy is the wrong word but you should always at least be self-critical what's one thing that people should remember from today's conversation we touched a lot of different areas so i think the realization of of the opportunity that we're currently having in the year 2025 and probably the next like five years to create not just generational wealth potentially but also to preserve wealth going forward i think is is one the key messages and i also wouldn't be too overwhelmed by let's say the long tail of all crypto projects and how can i get rich quick overnight generating wealth takes time and it needs a lot of discipline it needs hard work and smart work of course but it also needs self reflection as we touched it before and i wouldn't look too far i mean look what is around try to understand bitcoin my point of view that's the single most important thing that somebody can do nowadays is trying to understand Bitcoin and if you then still think you need to go further down the rabbit hole great, do it, right?

1:23:12But try to understand that and understand the importance, its role to potentially not just preserve your assets for the future but to also make them grow is the most important thing that I would say Crypto is a get rich slow scheme and a get wrecked fast scheme or we can improve it after two days conversation and say not crypto but bitcoin the get rich slow scheme and a get wrecked quick scheme i mean i i i talk about bitcoin a lot because for me it's a little bit the proxy of the crypto industry but i think it also separates a little bit because bitcoin has turned out to be some sort of an own asset class in itself while the rest of the crypto market i would rather compare it with let's say tech stocks from from the behavior on i mean the big blue chips kind of large caps in the crypto space and then you obviously have a lot of crap in it as well we didn't talk much about that and i'm happy for it so don't try to focus too much on those kind of topics but it's really the blue chips and bitcoin that will move the needle going forward and trying to understand that will certainly make a difference absolutely thank you so much that's very nice i think he's the second swiss person It feels good.

1:24:32I don't know what it says about you. Actually, I have a very good, do you say anecdote in English? Yeah. That I remember during this podcast. Okay. It's a great way to end. Never stopped dreaming. In 2000, so I built my first company in 2015 until 18. Yeah. And then I had very bad health issues. So we had to like sell the company. We didn't make a lot of money, but we had like good cash. But I couldn't work anymore. because of health issues. And at this stack of cash, I was like, I need to invest this in the best, most promising asset class in the world because I might never be able to work again.

1:25:12That's how I found crypto late 2018, right? I bought, I put everything early 19 in Bitcoin and ETH, which was a great kind of luck, both a decision, but I lost most of it in COVID March crash on Bitnex levered 2X, right? Whatever. When I got better, I was considering, do I start a new company or do I apply for some companies? And I knew this crypto thing in 2019 was the future. I was feeling like I need to learn more, but it's too intimidating and too weird. I'm not technical. I can't really do anything in space, let alone like build a company. Maybe I need to go work for a company. So I looked, I was in Switzerland and I looked, what are the job openings in Switzerland?

1:26:00And there was a bunch of opening in Bitcoin Swiss and in this crypto finance, I think. And I applied to both. And I never had an answer. And today I'm interviewing the co-founder CEO of Bitcoin Swiss. Never stop dreaming, guys. You maybe could have done podcasts at Bitcoin Swiss, but I'm happy that you continued. Because it takes a lot of, you need to be brave. and it takes balls to actually start your own company and leave the comfort zone of some sort of a normal job so I have the biggest respect for everybody that is doing that I just yesterday talked to a friend of mine actually working at Bitcoin Swiss trying to like create his own company and so on and I I mean a friend of mine I obviously embraced that so I try to always empower people and and and yeah tell them the probably the biggest thing that you will regret is that you didn't start your own company in the future and you didn't try it and if it doesn't I mean, you can always go back, right?

1:26:56And the advice is always just start. Yeah, but I need to do a business plan and I need to do the... No, no, no. Listen to these guys picking up the freaking phone at 3am for 300 bucks transaction or let's send someone to some gallon Bitcoin ATM for 10 bucks. This is like the real doing and starting and don't think about what's my greater plan. I mean, most people are not Elon Musk with a mega master plan, right? Just like start and try to see and see if what you're doing is valuable and someone is willing to pay for it. Even if it's not profitable, it doesn't matter. And just go for it, right?

1:27:30And you need to also like revise the business plan at one point and don't over-engineer it from day one, especially in crypto. So many things are changing, like the whole ecosystem. There is things happening that you could not anticipate like a few years back. So I think from that point on, yeah, just don't over-engineer it, start it and yeah, be realistic as well. Amazing. Thank you so much. It was an amazing conversation. Thanks a lot. As you probably know by now, I host some of the biggest names in Bitcoin and crypto on my podcast, but a lot of the best stuff never makes it on air. The Shift newsletter is where I share that raw behind the scene alpha, the insights, stories, and lessons straight from my guests that you won't hear anywhere else.

1:28:16If you want the real inside take on Bitcoin and crypto, join my newsletter, The Shift, in the description down below.