Crypto Trailblazers | Lane Kasselman, Blockchain.com

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Lane Kasselman

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play_circle_outline Lane Kasselman, president of Blockchain. com, discusses market changes and federal government's stance on crypto

play_circle_outline AI and blockchain convergence accelerating productivity and transparency in transactions

play_circle_outline Impact of crypto outside the United States, particularly in emerging markets and EU

play_circle_outline The Impact of Bitcoin on Transparent Capitalism: The Role of Compliance in Crypto Companies

play_circle_outline Company ambitions to become a public company in the future

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Lane Kasselman, Blockchain.com

Lane Kasselman

President Blockchain.com

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What has been the reaction of institutional customers to the changes in the federal government's attitude towards crypto? add

What are some potential implications of the convergence of AI and crypto, especially in terms of executing transactions and the use of crypto wallets? add

What was the reason behind the EU passing the comprehensive crypto regulatory reform known as MiCA? add

What is the level of regulation and compliance involved in the cryptocurrency industry today? add

What are the ambitions of the company in relation to going public in the future? add

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Lane Kasselman, Blockchain.com

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>> Hey, everyone, it's theCUBE here in New York City at the NYSE. This is our studio with the NYSE Wired community of theCUBE and the NYSE, partnering out of a Wired open community of experts and leaders, who are blazing the trail. It's part of our Crypto Trailblazers series, where we're interviewing the top leaders, sharing their perspectives, commentary around the market and the financial upside that's happening with this new climate, certainly here in the United States. Lane Kasselman, president of Blockchain.com is joining me here remotely. And Lane, thanks for coming in remotely. Appreciate it. Love the charts in the background, of course. We've got the traders behind us, trading all the options the old way, but the new way is here. Thanks for coming on.

>> Thanks, John. I'm happy to be here. Thanks for having me.

>> Being a trailblazer, obviously you take a lot of arrows in the back. It's been a tough climate this past few years, four years. Pretty hostile environment. A lot of people fleeing the jurisdiction, so to speak. Now, coming back into the United States, starting to see the visibility of the global landscape. You guys have been at the center of it, weathering the storm, but thriving. Give us an update on what's going on from your guys' standpoint with the views of the market, specifically the climate that's changing. I haven't seen this much action in the US government around pro-crypto as an infrastructure, but also as a currency and liquidity. You're starting to see people talking about IPOs. You're starting to see mainstream institutions coming in. I mean, it feels like cloud computing, but for crypto, all this ecosystem activity. What is your perspective on this?

>> Well, Blockchain's one of the oldest crypto companies in the world. We're nearly 11 years old, which in the crypto timeline makes us ancient, so we've seen a lot. We've seen a lot of market cycles. And one thing we've been asking for during that entire time are permanent regulatory frameworks everywhere in the world. Blockchain's not just a US company. In fact, our largest markets are outside the US. And we've seen that start to happen over the last couple of years in the EU and the UK, and certainly, across multiple states in the US. But one of the biggest questions has been what's going to happen with the federal government? I think most people that are watching probably know that the federal government was not too kind to crypto, certainly in the preceding 18 months before the election in November, but that's all changed and now the US is leading the way and that is causing quite a reaction in the market, but I think it's not from the audience that most people would think. Retail customers are not really reacting in the same way. What we're seeing is institutional customers coming into the market like we've never seen before, and they're certainly making up quite a large percentage of all the activity that is driving the conversation today.

>> Yeah, I appreciate that reference to being an OG in the space. It's awesome. Congratulations. And also, the point about the institutions is right on. We're seeing same activity here throughout the interviews we've done. Specifically, people are upping their game big time when it comes to putting together the requirements to actually integrate old systems with the new systems. What are some of those areas that you're seeing that's getting done? Work that's being completed? And what areas do you see that need some work?

>> Well, I think the fascinating turning point are the Bitcoin and Ethereum ETFs. So, for the first time ever, you're getting TradFi really important, notable TradFi institutions leaning into crypto in a very material way and giving consumers exposure to it, and also institutions exposures to it. That's created a watershed moment in which we now have all sorts of TradFi firms taking exposure, whether through the ETFs or directly. But what's even more fascinating is that as a result, you now have all the professional services industries that long existed for traditional finance now either opening up to crypto or crypto companies moving into that space. That's requiring companies like ours, that we not only provide crypto services to retail and institutional customers, we also have quite a lot of data on our Blockchain Explorer. We're now becoming a central source for information about on-chain transactions, which is critical when you're actually functioning in a TradFi world that's starting to blend with crypto.

>> I was just in the lunchroom, grabbing a coffee, kind of hang out there, getting some work done. I'm overhearing some other conversations here at the NYSE, and I'm surprised. About six months ago when we first started moving in here, I would hear conversations around other things, but literally, the domination of the conversation was around AI and blockchain. So, you're starting to see people having meetings, having the discussions, I don't want to say mainstreaming, but maybe I'll just say mainstreaming of crypto is happening. So, people are, I won't say putting their training wheels on. I think you have some pretty alpha finance folks that are smart. They're putting their gear on, right? They're getting ready for this collision, if you will, in a good way. What are you seeing as some of the key activities that these folks that are coming in, see opportunities, because there's a ton of opportunity recognition going on, but they're not OGs either, right? So, you got this new inbound migration of talent and expertise coming in. What are some of the observations you see around what they gravitate to, things that mechanically they got to work on to integrate in and take advantage, frankly, of the opportunity?

>> I think this is one of the areas that's so fascinating about crypto. The use case and the value proposition to customers around the world differs dramatically. So, for a moment, let me just give you a little bit of that perspective. In emerging markets, say, in the Subcontinent, in Africa, maybe in Nigeria or in Latin America, Argentina, those economies suffer from hyperinflation, and there's no real safe store of value for their fiat currency. So, consumers there have moved massive volumes to crypto as a safer store of value, which is a funny thing to say these days, that it's safer than a lot of those fiat currencies. Those customers are using crypto to transact, so they're paying the babysitter or buying a pizza or going to the grocery store. For them, it's just part of day-to-day commerce. That's not the same activity though that we see in the developed world, right? So, in the US or Western Europe, crypto is still very much an investment asset, but where it's going is what's so exciting. And to your point about AI and the convergence of crypto, we've been talking about this for probably a year and a half now. What really happens? Where does it go? And I think right now, when you use an AI agent, when you use an LLM to execute some sort of search for you, what it doesn't do is it doesn't execute the transaction. So, say you're looking for the cheapest pair of your favorite sneakers. You can have the AI help you find them, but it won't actually execute the transaction. So, the question is, when we get to that point, which I think is pretty soon, are you giving the AI your credit card number or are you giving it a crypto wallet? And I think most people, at least in my world, agree that you're likely to give that AI a crypto wallet. So, the innovation we're seeing now, these are things we're working on that I can't share too much about, but I know also our competitors and contemporaries are working on as well, is how do we provide the connection between those AI agents and the consumers who are executing transactions? Now, then you expand this beyond just consumers executing transactions, and it really is the flow of transactions around the world, and AI really playing a central role in the movement of those funds. Those funds are largely crypto.

>> Lane, great point. I think crypto, Bitcoin specifically, store value, check. No problem. I buy that. Everyone kind of gets that. It's like buying art. Hey, I buy a piece of art. And granted, we know the arguments. Michael Saylor would say, "Hey, art's art. This is fact. It's not digital." But digital currency is a system now. To your point about these transactions with AI and blockchain, it rhymes together, right? You got things like productivity gains, efficiency, transparency. The speed to value, if you've got that convergence of AI and a decentralized infrastructure, that transaction value just accelerates big time. We're seeing like Nvidia for instance. What they're doing is accelerating computing. Great, supercomputing for the masses, check. Here, you got decentralized infrastructure meeting the AI way, which is also boosting the same kinds of benefits. We think that's going to accelerate the commercialization of real-time transactions, stable, secure kind of internet. I mean basically it's like middlemen are gone, the intermediaries are gone. So, what's your perspective on that? What's your reaction to that and how do you see it?

>> One of the central tenets of crypto is trust, right? And I think that it's easy to overlook the lack of trust in the financial system because we have such a good one, especially in the US. The financial system is great in the US, it rivals the rest of the world, yet there's not a lot of transparency into what happens under the hood, and that means there's not necessarily as much trust. Crypto is the ultimate trust platform in that you can see transactions as they happen. Now, they're anonymized in some ways, so it's not like you're necessarily exposing personal transaction information, but you can see the transactions happening. You can see when they start. You can see when they close. That realizes a couple of benefits. One of them is the speed of transactions, the settlement of most major transactions, whether it's real estate or whether it's equities can be days, right? Sometimes it can be even longer than that, and time is money. Crypto enables those transactions to be trusted and closed almost seamlessly, instantly. That really is a moment in which our financial services industry and our larger TradFi world is going to have to face kind of a real reckoning and change in the way they do business. That's what we're most excited about. And I think one of the reasons we've seen so many hedge funds, asset managers, corporations, high-net-worth individuals move into crypto really since the election at the end of last year. They really are seeing that not just holding the underlying asset is interesting, and certainly the value in trading those assets is pretty exciting, but I think the hope of the technology being integrated into more than just the assets themselves is really what holds so much promise. We have been one of the leaders globally in the idea of self-custody. So, we call it your crypto, your keys. And we have self-custodied wallets, which means it's kind of like a safe deposit box. So, our customers have the ability to control their assets without any interference from external parties. Most consumers, at least in the Western world, are used to custodial products. Where your funds are sent to an account with everybody else's, but your deposits and withdrawals are noted on the ledger. That works in markets like ours, but it doesn't work in markets outside the US. And I think the realization that what we have here isn't necessarily going to be effective elsewhere is really what's driving crypto because crypto can adapt to different financial services needs and different markets in a way that we've never really been able to see happen quickly in a TradFi world.

>> Yeah, I mean that self-custody is a huge point. It's not centralized. You don't have to rely on some centralized organization. And by the way, centralization can be good, but it's also risk. So, again, great point, great call out there. I want to bring up the outside the United States piece because you brought that up. So, the speed to value creation is happening and obviously the store is there, store of the value. Outside the United States, mobile penetration is so massive. And wireless technology is a real forcing function. I've seen specific examples, and I don't want to say this is a philanthropy argument, but it really is a social change, is the confidence people can mobilize around commerce has become great with Bitcoin, because enthusiasm, whether you're overthrowing a government, which I've seen examples of or other kind of efforts, when you have money and confidence, things happen. People can organize, they can do things. This is a huge power dynamic in a good way because you now have the velocity of value creation and mobilization of any kind of commerce activity. It could be a social group organizing, it could be... whatever. They got a wallet on their phone, I'm good. I mean, this is a huge point. Share your thoughts on this because I think, in the US, we have all this kind of legacy stuff, but outside the United States, people aren't banked or they can't mobilize aid to something or an organization, so the commerce is limited by the system itself.

>> Yeah, news in the US is sort of like Gore-Tex. It all flows out, but it rarely flows in. And so, I think it is important to talk about what's happening outside of the US because it's pretty critical. We should draw our attention for a moment to the EU, which passed something called MiCA, comprehensive crypto regulatory reform across the entire EU. It was a huge piece of legislation that was passed last year. It comes into force this month and it regulates how crypto flows around the EU. But the reason that the EU leaned into this, it was not just because there were crypto retail customers and institutions wanting to use it across the union, but also, because in emerging markets that have so much intersection with the EU, crypto is that great stabilizer, where people are actually able to develop wealth. And I don't mean wealth in the buying a fancy car way, but a safe store of value to actually hold onto the value that they're able to generate and use it for something else to really change their personal economic situation or whether to save up for something that they need desperately to buy. Crypto has actually been that great leveling agent, and I think that was very early on recognized by the EU, which is why they were one of the first movers globally to create such comprehensive reform. I do think that point sometimes gets a little lost when we're looking at the all-time highs and the price of Bitcoin, because these are pretty crazy numbers that we're starting to see. The reality of the impact in the emerging markets that is, for the most part, largely recognized in the countries that are closest to it. So, those in the EU cannot be overstated. It really is quite impressive.

>> It's interesting. You have social freedom on one hand and then you have pure capitalism on the other. I mean, they work together. It's not like they're mutually exclusive in any way because everything is on chain, so it's like we've got self-custody, you can do both. It's not about, "Hey, I'm going to get rich and then do some social good." Bitcoin enables things in that way, store and the execution, but also, it's pure capitalism at its best. I mean, everything's there. There's no hiding anything. I mean, there's benefits, there's anonymous wallets. You can trace everything, but this is pure capitalism at its best.

>> Yeah, that's right. Yeah, and to your point, we are extremely regulated, right? We hold licenses all over the US, all over the world. We are meeting with regulators on a continual basis, being examined, filing reports. The days of the early crypto era in which things were happening behind closed doors, that's over. Most of the people running crypto companies today come from TradFi, they're used to having real compliance and those types of operations or what has been built inside crypto companies like ours. And really, not a good place to do anything illegal because you'll get caught and we'll report you. So, the reality is crypto really does work alongside the TradFi system all over the world, and it is really quite evolved and I think taken a rightful place in our financial system.

>> It's truly true. I mean, serious people are involved, big money's involved seeing liquidity in form of IPOs potentially coming on the scene pretty quickly. The maturization's there. I'd love for you to share some stats on what you guys got going on. Just give a few stats on blockchain.com, what you guys are doing in terms of the numbers. If you can share some key stats and give people a taste of the scope and the magnitude of how far down the road you guys are. You mentioned you're regulated, you got revenue, you got wallets, you got a lot of KPIs you're tracking. And again, this is a maturization, this is next-level stuff going on here. Share some numbers.

>> Yeah, happy to. So, like I said, Blockchain, one of the oldest in this space, and we really operate two sides of the business. We have a retail business and an institutional business, and both are quite material. On the retail side, we have over 90 million wallets or accounts that we've created since we started offering them. And of those, about 40 million are verified, meaning they've gone through higher levels of KYC and AML. Those customers are across 194 countries. We are truly global. And we are continuing to get licenses all over the world. At this point, we have them in more than 40 different markets around the world. We have processed over $1.5 trillion in crypto to date, and that keeps growing. On the institutional side, we have thousands of hedge funds, market makers, VCs, high-net-worth individuals, and they are trading over 800 different cryptocurrencies on our platform. That's really our secret sauce is we're kind of the alt coin store, so we're able to really help source liquidity on assets that sometimes are a little bit more rare or unknown, and we are really that partner to those institutional customers. All this is run by about 400 employees and growing. We were started in London, and that's where our biggest office is, but these days we're growing more right here in the US with our headquarters in Texas. But we do operate teams all over the world from Singapore to Buenos Aires, to Lithuania and beyond. So, we are one of the world's most popular ways to buy, sell, hold, and invest crypto. And one distinguishing point, in case viewers are going online and sort of checking the stats, we're a brokerage, we're not an exchange. So, our focus is different. We're not serving high-frequency traders on the retail side. We're serving people that want to get exposure to crypto, learn how to initially invest it and hold it, but not necessarily start on the trading journey. When they start that, we move them over to the other side, we move them to the institutional side. So, a little bit different in our focus in how we approach the crypto industry.

>> Hence, the retail piece. Great stuff. Great commentary there. Final question, what's the outlook for you look like? What's the vision? As the market kind of settles in, we've got a tailwind coming, we're feeling it here in the US for sure, the outside of the United States kind of normalizing. What's your vision for what happens next? What do you envision the preferred future looking like?

>> Well, it's no secret that we have ambitions to become a public company when the markets allow. The tricky thing about crypto is you need the public markets to be open to go public, you need the crypto markets to be pointed in the right direction and you need the company to be ready. So, we're working on the pieces that we can control, and are hopeful that the markets continue to stay pointed in the right direction on the crypto side, and of course, the public markets open so that we can really take a serious look at it. I do think that investors on both sides, the retail and institutional investors, are interested in having more exposure to not just crypto itself, but also the companies that are leading the industry. And so, we're really looking towards how we're able to create our place in that global public company ecosystem.

>> I got to say, on a personal note, I love this space. Been covering it since 2012. I think our first website in SiliconANGLE was bought in crypto. I think you had to go different channels on that to get that crypto then. Just the vibe in New York is solid. And here, coming through the NYSE, a lot of the OGs are coming through. You're starting to see scar tissue, as well as experience, mostly from other places, but they've been in for at least five plus years and growing, you guys have been longer. A lot of cool action happening. So, I think market climate changes a bit sooner, I think by next second half and certainly first half of 2026. You guys have your eye on any timing on windows for the market? Any view there? Any feeling?

>> Number one rule in crypto is to maximize optionality, so we don't have timing, but the goal is to be ready, so when the market's there, we can take advantage of it. But no exact timing just yet.

>> Can you share any revenues you guys are doing?

>> The company is profitable, I can share that with you. And certainly well into the unicorn status in our valuation, and very hopeful that that only continues to point that direction.

>> As Dave Vellante says, my business partner, he always says, "Someone's going to break the seal. There's always one penguin jumps in the water, they all jump in." So, it looks like the crypto IPOs are on the horizon. Again, that's based on business performance, that's not hype. I mean I know a few companies, I won't name names, but they could be worth $20 billion with the revenues they got, so there's real revenues hitting. Congratulations, Lane. I really appreciate you taking the time out of your busy day to talk to us here at theCUBE, and of course, the NYSE Wired community and open network of experts. Thanks for coming on. Appreciate it.

>> Pleasure to be here. Thank you for the time.

>> All right. theCUBE and the NYSE is an open community of leaders, a trust network that's been forming as a result of just collaborating with individuals, sharing their voices, sharing their knowledge. Of course, long-form content. We love that podcast style. And again, bringing that to you here from the NYSE Studios, CUBE Plus NYSE Wired. I'm John Furrier, of course, we got the Silicon Valley, Palo Alto office connecting tech and finance. Thanks for watching.