E180: Kast Founder: The Biggest Crypto Opportunity Of Our Lifetime Is Happening Right Now

41:53The biggest thing you could do was build a fintech or a bank on top of those rails and I had that thesis you know when to build cast on that thesis I think it's playing out now and And now people are realizing that it's there. But I also think that like everyone thinks it's easy because there's a few of these partners we talked about before who can help you with virtual accounts and cards and things. And I think many are finding out it is not easy and it's super hard work. I think a lot of exchanges and wallets and others have slapped on a card or slapped on some of these features. Everyone is doing that.

42:27Like we have multiple partners of Winshift Happens that are also launching soon or have launched cards or payments yeah which is a problem for us also because i'm like shit now they're like hey kevin you need to probe all this and i'm like everyone doing the same thing yeah everyone doing the same thing right yeah um what do they what might they fail to understand about how hard it is well the thing is or what are they doing yeah and how comparable is it to what you guys are doing or are trying to do? So the thing is like to attach a card to your wallet exchange, whatever, relatively easy, but still a couple of hard things, which I'll talk about in a second, but is doable, right?

43:19And so a lot of them are just like, you know what, we have a bunch of tokens, let's just throw these tokens on as incentives to try to grow our base, right? There's still three things that are hard. Firstly, you've got to go and create the whole experience around the card, which means you've got to go and make physical cards like this. This takes us a long time to go and build, right? You've got to give them concierge and customer support now suddenly, right? A lot more compared to just being a crypto, especially a wallet. And the third thing is that there's just a lot more things that go wrong, you know, declined payments, refunds, all this other stuff, which a lot of crypto companies are not ready to do.

44:00So that's the card bit. Now, when you go and add fiat rails, you know, dollars, euros, you know, we have direct payments into 50 countries now, right? Instant payments, which is growing all the time. We have 20, 30 up providers. Your life gets infinitely more complex. And I think they think it's easy. And so then they go into it and then they realize that actually to make any sort of margin in this business is super hard. It requires a lot of upfront infrastructure. And then the volumes often don't arrive and then they get dissuaded and think, oh, this is not a great idea. Recently, we've seen a bunch of ones actually just who are there actually for a couple of years, you know, give up and shut down.

44:45My theory is, is that in 12 months time, the majority are going to give up on this and shut down and think this is way too hard. And there's going to be a few big players. why do you think that most of these neobanks are shutting down they can't make the economics work it's as simple as that they're just losing money and there's no way path that they can see to ever turning profitable and the only way you can fund that is if you get um you know funding and if investors can't see that you've got a path to you know building something bigger then they don't give you the funds and you can't run profit you can't run losses forever simple as that the other thing I would also I would say is that cards in themselves are not a profitable business we do just a card you'll never make money the major thing you have to do is build all of the other products and so you know at cast we anticipate next year more than 50 % of our revenue will come from other things that are not cards right and that's why we're spending all this time and money building this other infrastructure so we have a more holistic product for people the cards are really just an entry point so that people can experience your product but ultimately they're not the way that you can you can make money what are some examples of products that can be very profitable for a company like cast but that uh a jupiter for example can't do easily because i'm thinking about for example jupiter will have a very profitable business because they didn't start with this very low margin kind of business, right?

46:20And then can add a card or build like a Jupiter spend, et cetera. Exactly. You guys are starting with something which is much lower margin, which is much more difficult. But what are things that by doing things that you do and being a fintech instead of like a crypto wallet or a crypto exchange that you will be able to do later that could be very profitable that a crypto exchange or wallet will not do or cannot do? So firstly, let me give you the secret of building any fintech crypto business is that you have to find your niche and you have to become quite good at that niche. And the way you make the majority of money from it.

47:00So, for example, Jupiter team, great team. They have a fantastic product in trading that makes them a lot of money. Right. And then what you have to do for long term success is you have to find at least 10 other things that are going to make you money. So the one thing, if you go and dig into the statements of Coinbase, Robinhood and others, is they will talk about having 11, both of them talk about having 11 other lines of business that make at least 100 million, right, in revenue. So they have one thing that makes a lot of money, the crypto trading for Coinbase, probably a bit of USDC as well.

47:38But they have all these things. And so what I'm saying is that for us, you know, it was cards, that bit shrinks. And then we have to have 10 other things that we're investing in, which include cost for business, includes Castro, includes, you know, the biggest thing, which we think will be 20 to 30 percent is just the movement of money. That infrastructure for you instantly pay money in and out of like 50 to 100 countries. That is super hard because it requires you to go and invest. We have a team of 100 people building the tech, the compliance infrastructure, the banking partnerships, all of this, and that is really, really hard to replicate.

48:21And that means that you become a white-labeled solution for other businesses in the future in that specific sector? No. So we build it, and then we have a business product, which is something closer to like a ramp or a Brex, but a global version, which we're now rolling out. and we don't sell that infrastructure to anybody else today because we think it's a secret source it's very hard to build but once it's built it's a secret source and so instead of giving it to others we're going to keep it for ourselves and our customers because that is what will keep people sticky with us so that i think is the absolutely the hardest bit to replicate um you know i've been having meetings the team and i was like guys this is like a massive wall you're pushing through this wall right it's a really we have to build so much infrastructure to get through this wall but once you get through the ball it's very hard for others to follow so from what i understand people who think or say that cast is a card business yeah are wrong they're absolutely wrong there's no way in the card was not in my original vision paper the vision paper was to build a global neobank on top of the stablecoin layer, but to have all these other things.

49:33Now, we found PMF in cards early, which is great. We found early users there and we make very cool cards and they're designed really well. But the business is providing a full financial platform for people, especially in their needs that are banking-like, right? So we don't really focus on the trading. We think there's just so many apps for trading. We will have a wealth product which will have some trading, but it's not our focus. Our focus is building the boring stuff for people's everyday lives around how they move, hold money. And we think by focusing super hard on that, we will build a very big advantage.

50:19It will be very hard for others to catch. Who else is doing that? I mean, the common ones that people see in the market at Red.pay, maybe Etherfy, there is Jupyter trying to do it, there's Plasma trying to do it now. I mean, there's Trio, there's so many, 2.0, there's infinite ones. The reason why I'm asking that is if Cast has a couple of hundred employees, but Plasma maybe has 40, I don't know the exact numbers, right? or I don't think, I mean, Jupiter is probably like 150 employees overall, right? I don't know the exact number, 100 something, but overall, so in me, Jupiter spend is probably way less.

51:04Where is the difference? Is it because they don't take the thing seriously? Is it because Cass is going too hard on hiring? Is it because Cass is trying to build something different? That's what I'm trying to understand. What's the difference here? Firstly, it's like employee numbers does not always equal output anymore. because of the use of AI for a start. But secondly, I think it's just the diversity of products we're building. So I think the others are building, for example, a card product with maybe some staking and euro and USD accounts, right? We're trying to build the full gamut of infrastructure for moving money, right?

51:39We're also building a complete business version of it as well, a full ramp of Brexit competitor. We're also building a lighter app for emerging markets as well. and then we're building you know everything we can into those products which include which include credit include trading include building the hold money um so we're building a lot of stuff so that you know the vision for me is like you come in because you're like hey i've got some stable coins i want to spend it oh really cool and then you're like oh actually i can save my money here oh i can move my money instantaneously to 50 to 100 countries i can use swift i can oh I've actually got a business as well.

52:18Now let me go and sign up my business. And now let's give this to all of my employees and bring my whole life. And eventually we just suck in all of your financial life into, I would say the cast ecosystem of products, right? That's the game. Now, most people are focusing on the first one where they're just giving a card and maybe they have trading or something else. Right. But if you want to come and compete against us, you know, we're going to be doing the whole lot. Right. And that is the game that we're playing. Right. And that is what I'm betting on that people won't be able to keep up with because they'll have to spend a year or two catching up with us on the stuff that we already have.

52:55And then by that time, we will just be further ahead. Look, this is a complete momentum velocity game. And the major thing that I'm putting foot down on is just the velocity at which we ship, you know, shut up and ship is my saying internally. And my view is that in a year or two, we'll just have more velocity, more product. and we'll just be so much further ahead it will be hard for people to catch up with. By the way, we have no option but to do that because if you don't and others catch up, then you end up as number three or five or ten, you know, and no one really cares about it. You know, you have to look at the likes of like Revolut or Nubank who in the previous generation of Nubank smashed it.

53:36They just shipped and shipped and shipped and they just had incredible velocity approach. And you can see the difference between Monzo or Revolut. I was in London in 2015 for three years to build a data company. And so I was an early user in 2016. I started to use Monzo and Revolut. And I invested like maybe 2 ,000 pounds or something in Monzo. They had this crowdfunding. The difference between both is like day and night in terms of, I think I made almost no money on my Monzo investment or barely. And then Revolut is... And they 500X. Pretty much. It's like the thing is it's just a velocity game, right?

54:21And so I, like in the early stages, we've had people that started before. We actually started pretty late. It's only two years. There's a bunch of people that are, you know, four, five, six years old now, you know, who are still ahead of us. But we're growing the fastest. And I think that's just sheerly in product velocity. and product velocity also means that you're giving value to your customers they're coming in they're using something and then they're like oh i can also use it for this and this and this and this and eventually if you want to engulf all of your competitors and smash them then um you know frankly you've got to have that velocity and by the way when i say competitors i mentioned some names before i don't actually think of them as competitors i think they're all trying to provide value and so i'm very supportive of them also being here because i think the pie is just so ridiculously big there is food there's plenty of food if you start looking at other crypto companies as your competitors like frankly you're an idiot right i mean the stat that i rolled out the other day was that you know new bank and revolute started 2013 to 2015 right they've been around for 10 years.

55:30They approach, you know, New Bank's$20 billion roughly in revenue. It's getting close to$10 billion in revenue. I'll give you a fun stat. Both of them, if you look at the amount of assets they have, customer assets, are one hundredth a J.P. Morgan, right? So if you sit here trying to compare against whatever name, you know, we're talking about crypto, if they're one hundredth of a J.P. Morgan and we're 100th of them. What the fuck are we? Nothing, right? And so that's why it's stupid to look at others. Even if others try to make the comparison and look as competitive, I don't look at it that way.

56:14I think we have a long way to go to catch the absolute stars in the Revoluts and Newbanks and they have a huge way to go to capture JP. And so, yeah, we have decades ahead of work. Quick shout outs to our legendary long-term WhenShiftAppens partners, without whom none of this would be possible. Thank you to Cast, my go-to global money app to store, earn, move and spend stable coins across 170 plus countries directly with Apple Pay or a physical card. On top of that, I can also get paid in USD and Euro with my Cast virtual account. Use my promo code SHIFT, S-H-I-F-T, and my link below to get 10 % off your membership, earn up to 3 % instant USD cash back on every card spend and get up to$250 in cash for referring your friends.

57:09No banks, no borders, just money that moves with you with stable cash rewards. Thank you, Treasure. My favorite cold wallet to store my Bitcoin and crypto and make sure I sleep well at night. If you want to sleep well at night too, you can order your Treasure wallet with my promo code WSH10 and get a 10 % discount. Check out my treasure link in the description down below. I have to say, I've been using Cast for about a year and a half now. So I need to tell people, I love the product, it's super useful. I basically live my life on stablecoin. I was one of these early Revolut Monzo users, which changed my life.

57:55barely had any money in a bank, in a normal bank, traditional bank. Since 2016, I discovered this. And then in 2024, I think. Yeah, 2024 or 2025. I'm starting to confuse the years now because I'm getting old and that's what happens. I discovered the beauty of stable coins and just live my life on stable coins. And then I think about a month or two later, I started to use Cast. And for me, it's game-changing. It's been game-changing ever since. So everyone, if you want, obviously, to try this out, there's a link in the description down below. It's been game-changing for me and it's probably going to be for a lot of people moving forward as they realize that it's just so much simpler than using a normal bang.

58:49We hope so. We hope so. But we have a lot of work ahead as well. You know, we're far from perfect still.

58:58Cast raised 80 million at the 600 million valuation. What the hell are you doing with$80 million? Well, I mean, we're building a lot. I can tell you. And we always had to run, you know, break even, you know, because we only had 10 million for most of the first two years. Actually, when I say 10 million, we had launched for 500K, you know, And we raised a lot of money, you know, slowly, a chunk at the beginning and then more. So, yeah, I mean, we're building, we're acquiring companies, especially for that infrastructure. As I said, we rely a lot on partners. We want to own a lot of that infrastructure ourselves.

59:44We're doing a lot of licensing and acquiring companies with licenses. If you just do these three things, by the way, you can blow through a lot of money. So a lot of the money is going through, I would say, capital intensive stuff. And for the first time in our company, we've allowed ourselves to run into small losses for, let's say, a period of six to nine months to invest harder. Like we made up workforce triple or quadruple so that we could build more. That means we have to sustain losses for a while until we break even. We'll be break even again within, you know, 2026. So there's no issue there.

1:00:22so it just gives us more flexibility than running like like on fumes basically and ultimately like you know the thing is the greatest comparison is you know which investors say is like us versus like a Revolut or a NewBank which are the stars of the of the neobank wars from you know a decade ago but imagine you know revolute makes these guys make billions in profits right they're billions in free cash flow they're building in every airport you go to in europe now has revolute ads they've got they're just building in so many fronts and we i'm not i don't even frankly care about the others in crypto i'm worried about how do i catch them how do we build a cast for business you know a cast for business we're doing a partnership with deal and so we'll have an employer of record and payroll and all these things we have to have a full-blown cast product i have to do all this against a multi-billion dollar competitors right and then 80 million doesn't seem like nearly enough and my view is is that over the next two three four five years we will probably raise a billion dollars to actually execute on our vision fully and properly but we have to keep executing at the size we're at and that money will come over time um so but we are very very responsible with it as well to make sure that we also don't have to raise again if we don't need to but the reality is i think we will be raising because our ambition is extremely big when you go from zero to six hundred million dollar valuation in two years and a half yeah that's a interesting that's a lot of wealth creation for people who started a company and as you mentioned as we talked about in our first podcast together and you mentioned before also you built a company that I think was worth$100 million on paper and then didn't work out then you took corporate jobs and now you're building this company and it's working really well at least so far when do you sell equity to secure your future as a founder that's something that I think is not talked about enough, but actually is very common in startups.

1:02:42And the investors will usually encourage it because if the founder has secured his future, then he's probably more likely to do a good job. Yeah. Look, this is a tricky one, and I'll try to be concise in my answer. Firstly, we don't confirm or deny the valuation, but it is what's reported. It was actually closer to less than one and a half years we got there. um worth more now um but one thing i would say is that there's a few parts which i haven't shared which i'll maybe share now is that um so for me personally like i'm crazy i like staying crazy right and for me crazy is that this could be a hundred billion dollar plus business i've said it before i'll say it again it may be much bigger right so um we had some people who came in early and then they left and I sold a lot of my shares that I made through my corporate life, including through Circle and I had some pretty good jobs and made some pretty good money.

1:03:43I would say I was financially secure coming into this, but I invested more than$5 million to buy out other people myself. So I'm very unusual in a founder who has not only taken investor money but has invested a lot of money myself personally to buy out others and I've never sold a share. and in the last fundraising we had a few million dollars of buyback we had actually a few million of buyback for early investors so a bunch of early investors who did pre-seed checks and stuff sold out and then we had a little bit single low single digit millions for staff so they could take out a few hundred thousand each very very limited but for this exact reason i wanted them to be happy often you know we had an absolute cap of twelve thousand dollars a month of salary which including myself I took I'm not the highest paid person the company is many ahead of me and so a lot of people for two years where I'm typically the executives are ten to fifteen thousand dollars a month obviously negative bad families and others we had to eventually lift the cap so that people could live properly and that's why I said to a few of them you know you should you should cash out a few hundred thousand so all that negative income you've had you know to manage your family you're at least positive now to get to the answer of when do i cash out as a founder which is what you probably want to know yeah like my view is is that i haven't cashed out a single thing i'm actually invested heavily i didn't cash out a single drop in the series a even though i could have and i let others cash out um and i've got opportunities to uh sell when i haven't still this is for two reasons one is that i think i like the alignment i like i like the fact of being a founder that's crazy and and just hasn't sold or hasn't tried to you know take any money out um because i think investors really like it as well because they can just see how deeply how deep your belief is in creating something of great value.

1:05:50The second thing is that I don't need it, frankly, because I luckily plan my life pretty well. Now, I will cash out a little bit at some point, maybe in the next year or so, but my primary goal is really just to recoup some of the money that I invested, you know, over time, but not really to sell any substantial amount. And the main reason is that if you do do it, like what am I going to do with that money anyway? right i have no desire to go on buy you know i don't know crazy car whatever like everything i have um everything i need i have you know i have nice house i have enough i've gone nice holidays etc like i had that before cast so um it's a little bit different for me i do think for other founders if they hadn't secured themselves it is recommended that you do take out a few million or whatever not so much so that it looks like you're just cashing out but enough so that you can say focus on the business without distractions of how do i live day to day i had dan tapir on this podcast a few weeks ago he said he likes cast but it's a bit small for his 50 trillion fund yeah who is the next equity buyer at one two three billion valuation i think it's mostly growth funds so um the 50t guys and dan are more of a growth investor and we're mostly focused on growth investors particularly um fintech and um growth funds we haven't really traditionally taken money from crypto companies at all uh crypto vcs that is and i would say dan's business is a little bit different because it's not really a crypto um i mean look it is a crypto investor but it's like a growth investor.

1:07:37So they're looking for companies that are, you know, I would say 50 to 100 million in revenue range, which we're coming into now. So it would be that type of investor. The reality is it's like if we've written 80 million for our Series A, our checks that we'd need subsequently are going to get bigger. They're going to get into possibly the hundreds of millions, right? and the crypto VCs barring a couple just don't have that much money to invest to that level I would say that Dan and his fund you know does have can write a decent check but there is a cohort of investors that can write much much bigger checks again and that's really who we're looking towards we also by the way have many really good investors already who still have capacity right so where we need more funding typically we can go to our current investors and they'll top up because they still have a lot of capacity and then we can take on fresh funds from new investors as well last time we talked you said that cas was hiring a ton of people because there was no way to take shortcuts when building a new bank yeah but many people seem to think you might have taken shortcuts because of something they recently discovered that was public already.

1:09:00Once someone deposits their money on cast, the money isn't theirs anymore. Yeah. Can you explain? Well, I mean, I would say that this was a mistake in the way that our terms and conditions were actually written. By the way, the T's and C's are like massively long, right? And when you're moving fast as a company, you know, if you're a custodial platform, and by the way, by the time this podcast is out, probably we'll have the full self-custodial or non-custodial option first and the self-custodial after. We already have the infrastructure to do it. But essentially like, you know, on a custodial platform, you give the money to that platform and then it's a debt to the user, right?

1:09:43Now it's very, very clear in our T's and C's now and that was always the way that we operated. but it probably wasn't clear enough in our T's and C's which got pulled out by someone and made it into a big deal. But it's clarified now and we're spending a lot of work with lawyers to make sure it goes through all of our T's and C's to make sure that they're very customer friendly and the intention of what we're doing is extremely clear. We're also spending a ton of money on auditors. We've got an audit firm. We went through ridiculous amounts of due diligence when we'd raise our Series A. Most people don't know this, but one of the big four did a three-month due diligence where they took anonymized, obviously, transaction data, but every single data to see it balanced, it was managed properly.

1:10:29We went through financial due diligence, tech due diligence, legal and compliance due diligence. So I've been through a lot of it already. But yeah, I think startups, like you make mistakes, you don't have everything perfectly written. Someone pulled it out and made a deal of it. We fixed it. we move on the way I use personally cast is I send a couple of thousand bucks and I spend right but your goal is to make me keep my money there and earn yield and all that stuff so basically your goal is to make me have more than a few thousand bucks at a time on the app yeah

1:11:07what happens exactly to my money as a cast customer if cast goes out of business which will definitely impact my decision on keeping more money there or just using it to spend? Yeah. So the first thing is that we keep a lot of that money with licensed custodians as well. And so that provides some level of surety. We also are clarifying our bankruptcy remote structures. But I think the other thing that most crypto people especially want to know is whether you can have a self-custodial or a non-custodial option, which by the way, you kind of do already because we already use Privy wallets for our wealth section.

1:11:45And so when you put money into earn, for example, it's actually non-custodial. But now within the next couple of weeks, we're making it much clearer that you can actually have non-custodial money. So you can actually own the money yourself in the way that crypto people like to do it completely as well. Which means that if CAS goes out of business, you have access to your money. Exactly. It's still not the case, but it will be soon. It's the case for certain parts of the product already, but we're extending it as an option to everyone. So today, if people are using Earn and Cas goes out of business?

1:12:27It's a non-custodial. It sits on a non-custodial wallet today, which we partnered with Previon, which is a well-known provider of wallets. And we're going to extend that. Now, look, the downsides of this is, which I just want to talk about for a second, is that it provides for a much more complex user interface. And this is why we designed it. It wasn't because we don't want to give you access to your money, just to be abundantly clear. The thing is that traditionally in self-custodial wallets, you deposit, you have to accept. We can accept lots of chains and multiple stablecoins and you could move it out.

1:13:06You don't have to deal with gas. You don't have to deal with swapping. You don't have to deal with bridging. it's very very simple right now as soon as you give a self-custodial wallet you need to manage a lot of that stuff yourself right and so some people want to do that now my view is is that that is the 10 of people right but you know fair is fair we will give those people the option and if you want that's what you want to do or if it's required for regulatory reasons you can do that no problem with us but you have to take on also a slightly more complex user experience because a lot of those things that we were helping make very smooth for you are not going to be as smooth anymore um but you know that's a user choice so the trade-off is smooth but centralized and giving up the custody of your assets to the provider like cast or like revolute right or like all these fintechs?

1:13:58Binance, pretty much every bank, like 98 % of customers. The only ones they don't are self-custodial wallets. Crypto people in particular are very passionate about self-custodial, non-custodial. But even then, I would say look at the size of Binance OKEx, Coinbase versus wallets. There's still 20x the size. Of course, because most people don't want to deal with hassle and problems. So very happy, you know, from our product team's point of view, I've said, look, we already have the preview wallets. We're already doing it. I've been doing war rooms with them to say, look, we already had this in plan.

1:14:40We already actually had tested it. Let's just release it and get it out there. And I think, you know, hopefully by the time there's release, it'll be out there and the customers will have the choice, you know. And I think that's the most important thing. but your customers will also have to trade some parts of the experience in the process we hope very little and it's definitely got better but that is also you know one aspect that they have to deal with I think a major question here is for example if I use earn

1:15:20and cast goes out of business I still need to trust cast that they will... I'm just thinking about the Celsius case, right? Yeah. Which they were using DeFi stuff. Maybe it was not directly through the customer, but they were using DeFi stuff. But at the end of the day, they took everything away. Is it different here? For example, for a product like Earn, or I still need to trust that Cast has good intentions currently towards the customers, and they will say, actually, this part here was decentralized criminalized or was self-custodial therefore this is your money but these other parts not therefore we take the money and it's a debt towards you and it's going to go into the bankruptcy well i think i think the thing is is that firstly it's like any firstly we're licensed in a lot of places getting tons more licensing and um getting audited we've been audited already so you know we have a lot of that infrastructure built early we've got a very mature team the second part is that if you go to full self-custodial which is what i think crypto people want in particular then you hold the keys right there's nothing anyone can do to help with the keys and that's where we're moving the product to to be full self-custodial by the way the majority of people because of a lot of complexities which i don't want to bore users with are non-custodial right but they're not self-custodial right and so if you're non-custodial you can see that your money is there but often the money is locked in a smart contract because the reason is like when you swipe your card there's a lag time between there's a little bit of risk where people when they're self-custodial can take their money out of the account and you get an approval when you swipe the card because it thinks that the money's there right and so a lot of them will do a non-custodial where they'll say, including a lot of the key people within competitors within the crypto space, where it's not self-custodial, where you can't take the keys out.

1:17:23It's still locked in a smart contract and you can see it's on chain, but you can't take it out. So yeah, we're going to move to non-custodial and self-custodial options. So people, if you want to take your money out, you have the keys, you can do whatever you want with it. so what is the difference between so most of these other people would do non-custodial yes so you can see on chain what does that mean exactly for the end user it's that they can see on chain where it is like my money is here you can go and look it up on chain but you don't have the keys which means that if you can't export the keys so if one goes out of business the money isn't going to be that easy to retrieve?

1:18:08You still have to go through some process to get access to keys. It might be with a third party, but you'd have to go through some process, right? A full self-custodial is that you own the keys, you put the keys into another wallet, money's in that wallet, right? And I think, look, ultimately you want to give people full self-custodial. I do. I mean, like, I'm a crypto person at heart, but it comes with a lot of compromises around the user experience right you may have to limit how much people can spend for example because there's a certain risk that providers taking on the cards because the risk that people couldn't just take they can say oh the balance is two thousand dollars you swipe for two thousand dollars in in the meantime they take that money out right so you may have to create limits you have to worry about putting the money in in that chain you have to swap it you have to if it's usdc you can only take out usdc there's a lot of things that you can't do as soon as it goes to a full self-cursodial setup which frankly like i said if users want it we will provide it right um but the majority of users just want a platform that they can trust they know that we've gone through you know we've got top fintech investors they went through ridiculous amount of due diligence before they trusted us um and you know majority of people just want an easy way to use their money, frankly.

1:19:30Absolutely. I don't want more complexity, right? They already have a complex life, you know. But, you know, just to reiterate, if people want to have that extra complexity and they want to fully earn the keys and the money, then they should have that. I'm very supportive of it, and that's what we'll give them. You put a lot of emphasis on design and brand. Why?

1:19:58um frankly i'm very so when i was young i used to ride my bicycle around to different suburbs and look at houses because i want i think i wanted to be an architect when i was young and i just i just love beautiful design you know i think it's just a passion of mine here in singapore we've got a you know head of branded design and we're actually building a design studio so that we can make everything so much more beautiful right um frankly like life is meant to be live in richness and color and beauty this is humans that are not black and white they don't look at features on a product or usability alone they like things that are beautiful right otherwise the fashion industry wouldn't exist otherwise ferrari wouldn't be such a you know incredible brand etc so i like creating beautiful products and i personally look at hundreds of screens on cast to make it more and more beautiful we review the cards very deeply we fly people around to make these cards and my view is is that and this goes back to the discussion we had around cost right is that people will pay um you know not a ridiculous premium but a premium for beautiful products right i certainly have i certainly do and um i think we all do with what's in our pockets every day yeah exactly and so um yeah i think and that extends to us very widely it's not just the app but it's also the user experience that you have with the concierge.

1:21:38It's also the physical cards. It's the packaging. It's our events. It's our upcoming. We're going to have travel and lifestyle services and how they're delivered. We're going to have moments and special experiences. We're going to have collaborations with brands. We're going to have one-off. We're working with someone to make one-off shoes. We're doing a lot of stuff in terms of branded design. And I think this ultimately makes people much more passionate about um casts as something that they're very proud of showing to people you know and um i think it's an unfair advantage that we have we have people that have an eye for design and brand and culture and um we'll be collaborating with sports stars and musicians and other things so that we are transcending not just becoming like a product that you can move money in, but a complete lifestyle.

1:22:36Lifestyle brand. It's a lifestyle brand.

1:22:41Quick shout out to the legendary team at Jupyter, the DeFi super app. Anything you want to do on chain, from trading to earning yield, you can just use Jupyter. Personally, I recommend getting the Jupyter wallet on either your phone or your laptop. 10 times faster and 10 times cheaper than the competition. You're going to love it. Thank you to the awesome team at Athena for backing today's conversation. Athena is one of the fastest growing projects in DeFi with over$7 billion in stablecoin supply and an average 11 % APY on SUSDE. And importantly, zero DPEGs since launch, which is exactly what you want from a stablecoin.

1:23:20Go check them out by following the link in the description down below. This bit is more about the CAST community. so I'll keep it short because we're here obviously aiming for the masses but I still need to ask

1:23:40and I'm one of them obviously many people spend a lot of money and funded the cash growth because you offered some juicy cashbacks in the form of a future token in the beginning even once we discussed you and me I said the fees 1.5 2 % is not low. And you told me, yes, but you'll get it all back easy on cashbacks. Because the cashbacks were like 3%, 5%, 6%, 10%, 12 % depending on the tiers. And so even now I was like, okay, 2%, let's say the token launches, goes down 50%, but I make 10%, that's still 5%, that's still 3 % higher than 2%. So basically you make very quickly the decision that it's a no-brainer.

1:24:23Again, our generation, as I said before, is very conscious of fees. A few weeks ago, we learned that there will be no token and therefore all the dollar value accumulated in future tokens will not be liquid. It's going to be tokenized equity. Or similar. Possible. How can the community that trusted you and funded you not feel cheated here? well firstly i would say that in business you have to be willing to make hard decisions and you have to be willing to be misunderstood for perhaps a long time right and i don't think that the decision will be fully understood for um for a period it could take two years three years four years right i don't know how long right i would say that in communicating to users the majority have been very supportive of the decision because every single token pretty much every single token i don't even have to narrow it to neobanks or anything tanks right and most of them are down more than 90 percent more than 95 percent some of them have been down more than 95%, including many that our so-called competitors have been in that space, right?

1:25:52So we set up very clearly from the beginning that we're building cars for the long term and we are here to reward people who are long-term aligned. It was explicitly clear, right? Now, what happened is over time, the way that we could create that long-term alignment changed right um it was clear that tokens weren't going to do it and so i have to sit here and think and which is a process i went through is that how do we how do we create this long-term alignment how do we create long-term value right do i just blindly go and launch a token and the only way to support that token is with a lot of cash back buyback sorry and therefore you start the business you're unable to raise more money, unable to build a bigger business, which means you're unable to create longer-term value.

1:26:49But you satisfy people short-term, right? But you tank everything else. And you know what's going to happen? The token's going to tank because every single one of these tokens tanks. And then people are going to give you shit for tanking a token, right? So you're going to cop it either way. Guaranteed you're going to cop it. right so i went to the investors and i said look like i don't think this is the right thing to do and frankly one of the inspirations for me was revolute because revolute did a um it was slightly different that you know you could never buy cast uh anything like you the only way you get points is through using the platform right we never sold a token we never sold a saft we never sold users like the only way you could do it was through using the platform now you would say usage of a platform, putting up with fees as an indirect way to do it, sure, I'll take that on board.

1:27:44But Revolut went on now to build a business that's worth tens of billions, approaching$100 billion. And those people who came in early are sitting on very large multiples in terms of returns. And they're equity aligned. As the businesses got better, they've been 100 % aligned. So I took this to our investors and I said, look, I don't think Launching a token is the right thing to do. I think getting people some sort of linkage to the actual business performance through tokenized equity or whatever form it takes that our lawyers will land on is the right thing to do. And I can tell you that, and this is not talked about, is that we all had to take a dilution, including me, to get this through, to create space so that this could be an outcome for the community, right?

1:28:37And I think it's a decision where it will be misunderstood or shitted upon, if I can say that, in the short term. But in the long term, it will perhaps build a new model where people will say that you can actually earn points or something similar for using a platform and eventually get an outcome that's part of the business. Now, one thing I would say is that just to sort of like you know push back a little bit on crypto people is that the way that tokens are done is complete bs so few of them have any linkage to the actual outcomes that the founders are getting the founders own a significant chunk of equity they then create a token which investors get and community get and they get but the token doesn't have any ownership usually in the equity um it's completely a mirage as to who owns what token what tokens are getting sold etc it's you know it's frankly like you know they just give them from shit coin most of the time that looks legit at the beginning but it eventually goes down 90 95 percent and then um they often you know they don't talk about how much they've sold personally.

1:29:59It's free money for the team. It's free money for the team. And they say, oh, it's free money for marketing and all that stuff. But actually it's free money. Like you get like, you get like, you keep the equity with the upside and then you get this free money there. Exactly. You can cash out from easily. There's all these OTC deals and all this stuff that is made. Exactly. The founders get the, have tokens. Then by the way, they also, the founders usually also control the foundation. I mean, no one really gives away control of the foundation, which is another pool of money, which has no accountability.

1:30:31They're not publishing what they're doing with that money, right, typically. So they've got these two pockets, plus they've got the equity side pocket, right? Now, you go back to the question you asked earlier about how much would you want to exit, right? Now, by the way, for me personally, if I launch a token, it's a super easy way to cash out. You don't even need to cash out equity. You don't care. Exactly. I keep all of my equity. You go and do OTC deals on the side for the foundation and your personal tokens. You, you know, having a great life. This path is materially harder for me, especially with the information you know that I've never sold a share in equity either, right?

1:31:11And so it's a difficult decision. I can understand why some people were looking to cash out some. I don't love it. But it's materially harder for us. It's materially harder for investors. it's harder for users short term but I think with much more aligned long term by the way just one other thing is that but eventually as there is a linkage there will be periodic buybacks of equity and we hope that will extend to the portion I want to ask because before you mentioned you mentioned employees buyback of the equity if this is tokenized equity is there a secondary marketplace where people can sell it now we don't want to list that tokenized equity because it makes fundraising very complex.

1:31:55But if you look at like Stripe or Revolut or others who have been private for a long time, every six months they're doing some sort of buyback, right, and through which people cash out. And so we expect a similar form to happen through private markets every six months or every 12 months for people so they can cash out small amounts. And so it's not like we hope that they get nothing. We also, by the way, for the points are allowing people to do upgrades on the cards. We may allow people to cash in some for spend. So we are going to, we hear the community. We hear that they want to cash out some of it potentially.

1:32:28And so we are looking at ways to do that as well. But look, you know, you can give me heat on this. But, you know, if you lay the case out, I think long term is much more aligned. I think long term we're doing something that people haven't done before because they don't think long term. They don't go through the hard path. This is a much harder path, but it's much better for the community in the long term. Absolutely. And I mean, looking at being critical and looking at all these tokens, even I, as a spender, we spend quite a lot, quite a bit of money, have a lot of points. I can't see a way where launching this token is good for the business.

1:33:10Absolutely not. Yeah. And where maybe I get all my points and I can dump them directly, but if everyone dumps, well, not everyone will dump first. so it's a dumping game yeah like you're gonna dump you know yeah you know like just people in crypto aren't stupid right go and look at the charts it's like i don't even have to pick a single down bad just pick any single chart by the way the people who inevitably win through the back i call it the backyard deals that happen is like the investors figure out a way to cash out through OTC deals, you know, so do the founders. The foundations go and sell some converted to stable coins.

1:33:53They all sort themselves out. They always do in some way, shape, or form. Some are more legit and don't do it, but a bunch of people do, right? And so this, I think, is much more aligned with all the investors, employees, founders, community, all aligned. and the equity valuation that people would get this tokenized stock on is something is based on next raise previous raise yeah so the way that we're looking at it and this is to be confirmed because it's a it's targeted for q4 is that the notional value will get converted to the valuation at that time so you'll be sort of a one for one we think that's the the fairest way to do it um but yeah some will dispute it and i get that um but yeah ultimately a lot of people are taking dilution to make this happen um it's a harder path some will criticize me for the mechanics of it fair play you know and um we will try to make you know people who want to cash out have more options or we're trying to find ways that they could do it but the reality is i think this is long term going to be very good.

1:35:06And I think if you're sitting back here in a few years' time, you're going to look at this and say, wow, that was a hard path to go down. But now maybe everyone's doing it because they realize there's a much better way to do it. So it's always hard being, you know, leading at the front and trying to do something like this that's different. What's the hill you're willing to die on?

1:35:32the hill that i'm willing to die on is that the world needs a better place better way to hold and move money that is independent of local rules and governments that can be much more global because the internet is global and i'm willing to die on a hill to make that happen over multiple decades um yeah i mean cast is like you know um it's like nearly 100 of my life now so it's like there's no there's no way out you know and it goes to the point earlier i talked about like not selling because if by not selling anything you know you know you said like you could make yourself more comfortable by selling some and I will sell a little bit.

1:36:24I'm not going to say I'm never going to sell anything, but the longer by prolonging it, basically it means I'm dying on the cast hill because I have no choice. And I do that to myself intentionally so that it makes it harder and harder to find any other way but to basically make cast work. Give me one prediction that sounds insane today that becomes obvious in five years.

1:36:51my prediction is that

1:36:56crypto neobanks, you could call us that, will break out into being fintechs and will actually break out to becoming very substantially large companies that are in the same line as what you would think as the big crypto exchanges today, right? So right now that's a preposterous and ridiculous statement to make, even if we have$100 million in revenue, you know these crypto exchanges have billions or tens of billions. But my view is in five years' time, once that's all compounded and you start seeing much more scale in these neobanks that started in crypto or stable coins or within that space will become very substantial and people will have them on a level peg with fintechs, very large fintechs and very large crypto exchanges.

1:37:47And by the way, I think crypto exchanges know that and that's why they're pivoting hard and not wanting to lose track of what's possible here. We mentioned before, we said, last time we talked on this podcast, Bitcoin was like 120K and now it's down 50%. And you made a small comment. You said, yeah, I think we're close to the bottom. Mm-hmm. I like to look at what traders think on Calci to know more or less where we are in the market. And we have slightly more than 10 % of the traders who think that BTC will cross 100K before Jan 2027. Is the worst behind us for crypto? um i am a terrible at like exact market timing um that's why i build long-term businesses but i would say i do although i don't actively as traded as much anymore my view is is that the i can't predict by jan 2027 right but i can predict by probably something a little bit further out but let's say mid-2027 that i think you know almost certainly will be back at 100k um or close to now whether that happens by jan 27 i'm not so sure because you could see that the peak was in october 25 we're now nine ten months into a bear market but traditionally bear markets will go even a little bit longer than this right so that's your bet my bet is that we are Well, say Bitcoin is 60, it may, if something really bad goes, go down towards 50.

1:39:29I think the best reason for that to happen, you know, we've thrown war at it, we've thrown AI funding, we've thrown Michael Saylor's various positions at it. And I think Saylor sold some Bitcoin, so that's recovering. So I think the worst of it is there, but not to say it can't go towards 50, but I think here or hereabouts is roughly going to be the low. And ultimately I think people are not very interested in crypto right now. It's boring as hell. The price action is there. It's like everyone's distracted everywhere else and that is usually the base for a fantastic rebound just because like, you know, it happens in every bear market, right?

1:40:15And I personally think the four-year cycle is very much intact and so i think people are despondent don't really care about crypto don't see any value in it etc and so they will when it's like that you know it has so much more room to just pop and then people are like oh my god you know that's suddenly looking attractive you know also maybe ai will cool you know if you have anthrop spacex is already ipo'd Anthropic is probably soon after and OpenArea, there's probably not that much more to squeeze from it, from IPOs. And, you know, so they may start slowly coming down and then people are like, oh my God, Bitcoin, crypto, it's back.

1:40:59And I think it'll be good for people who stick it out. I think it'll be great. But, you know, there's not, you and I know, being crypto, a lot of people have left crypto. Yeah, big ones actually. Yeah. we'll get there guys. We'll get there soon. We're there. We're the survivors. That's why we record these conversations every week to make sure like we can keep people interested and keep some hope, some hope for the people that we still have some serious people building, even when everyone is leaving or looks like they're leaving. I think the thing is in, you know, if you do this podcast, you're going to find that it's like the next wave of crypto is people building real useful stuff.

1:41:40It's not going to be, I think there's always going to be meme coin culture there for sure. But I think people, the real builders are what's going to be interesting. For me, this podcast is the best way to stay bullish forever and double down at the bottom. I'm like, oh man, this is so obvious. It's so obvious. I'm talking to like the people and I don't even know where to invest. Yeah, yeah. If you've gone through all the pain already, you might as well stick around. Like if you sold at 120, 130 or above 100 and you're exited and you sit on the beach, you enjoyed your Euro summer. Great. Well, there's a reason why I'm in studio with you today.

1:42:17I didn't sell at 120K. You should be Euro maxing right now. I'm not so... I have to be honest. You've been very open with us today, so I have to be also open. I'm a terrible trader. I'm terrible at selling and I'm not Euro maxing today. I'm Singapore studio maxing with you. and it's called as fuck in this studio yeah yeah exactly exactly I brought a jacket just in case but we managed without it maybe we had some UV UV lights in the future like to keep us glowing yeah if I only remembered one thing from this conversation what should it be

1:43:04cast is in my view if I have anything to do with it I'm going to become a hundred billion dollar company now you should not believe me because I encourage people to be deeply skeptical but I can tell you the team is phenomenal we're building like incredible amount of stuff and all of us I think will just not relent until we can deliver the absolute greatest fintech to be built out of crypto, that's frankly possible. You know, it's an incredible team. You know, we're not perfect. There's so many ways that we're imperfect, but we definitely love our customers. It's a mature team of responsible people who've built fintechs before.

1:43:54I mean, I don't talk about this, but a lot of the leadership team have come from big crypto companies like Binance, at big fintech companies like Airwallex and Stripe and Revolut and others. That's who our leadership team is. And I think we have the best chance to build something very meaningful that doesn't look like just gambling in crypto. And so that's what I want you to remember and hold me accountable for because I'm extremely bullish on our chances. And let time be the judge. And that's who the team should be, by the way, Because if you look at the Monzo Revolut, the team was Facebook, Airbnb, and that kind of people, right?

1:44:36And then we always have the next wave. Yeah, our team are not people, this is not their first rodeo, you know. Our typical leadership team is the average age of 40 to 45, you know. So they've built this and they've seen the pain of what goes wrong. and this is their second or third time building from early startup phase into what they've all worked for fintechs that were nothing and then gone to 10 billion plus or even towards$100 billion companies. So that's why I say bullishly that I think we can do it because we've organized the team that's done it before. We're not experimenting with this as our first go.

1:45:15Thank you so much, Rags, for doing this. Pleasure. Thank you for opening up, being very real with us. Always. And thank you for being one of our dearest partners at WhenShift Happens since like a year and a half now. Yeah, not going to stop anytime soon. Awesome. Thanks, man. That was great. 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.

1:45:50If you want the real inside take on Bitcoin and crypto, join my newsletter, The Shift, in the description down below.