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TRANSCRIPTION WITH SPEAKERS
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[00:00] SPEAKER_01: Welcome to Canada's podcast.
[00:06] SPEAKER_01: So Justin, welcome back to Canada's podcast.
[00:11] SPEAKER_01: It's been about two and a half years since you came on.
[00:15] SPEAKER_01: You were one of the early entrepreneurs that I interviewed.
[00:19] SPEAKER_01: And I think it's been a kind of very interesting two and a half years in the world
[00:26] SPEAKER_01: since we first met.
[00:29] SPEAKER_01: You know, I just wanted to kind of give everyone a little bit of a thing.
[00:33] SPEAKER_01: We have a new series awesome premieres coming up in Q2 of this year.
[00:39] SPEAKER_01: And I think your story is a little bit along those lines.
[00:44] SPEAKER_01: You know, you're entrepreneurial and you've been at it for a while.
[00:48] SPEAKER_01: And I think you now CEO and co-founder of CoinSmart,
[00:54] SPEAKER_01: which if anyone puts looks at that, we'll see is a pretty successful public company now.
[01:05] SPEAKER_01: And obviously, as everyone could guess, by the name is operating in the crypto space.
[01:13] SPEAKER_01: So why don't you just give us a give you that's my update of you.
[01:20] SPEAKER_01: You just give us some some little bit of your side of it.
[01:24] SPEAKER_01: Maybe a bit more detail on CoinSmart and what you're doing basically.
[01:29] SPEAKER_00: Yeah, I know. Well, first of all, Phil, welcome.
[01:31] SPEAKER_00: Thank you for having me back.
[01:33] SPEAKER_00: It's actually me saying to you.
[01:34] SPEAKER_00: It's been a while.
[01:36] SPEAKER_00: Enjoyed our conversation.
[01:38] SPEAKER_00: Had a lot of people come out of the woodworks there who had listened to it and came to me and asked questions.
[01:42] SPEAKER_00: And I'm always available and I'd like to be accessible to people and be helpful where I can.
[01:46] SPEAKER_00: So I appreciate that last time.
[01:48] SPEAKER_00: Appreciate you having me back now.
[01:50] SPEAKER_00: And as you said, it's been an interesting ride over the last two and a half years.
[01:55] SPEAKER_00: That's for sure what started out of a, you know, pet project, a hobby that I was doing.
[02:02] SPEAKER_00: And true entrepreneurial faction has turned into a full business that was funded.
[02:08] SPEAKER_00: That went public became regulatory compliant multiple countries and jurisdictions around the world.
[02:14] SPEAKER_00: And I have an awesome team of 50 plus people who are really making things happen in a completely different way.
[02:21] SPEAKER_00: And we're changing the landscape today of making cryptocurrency accessible, helping bringing the crypto curious into the into the ecosystem, helping educate them and loving them up to an ecosystem player.
[02:34] SPEAKER_00: And really helping to bring more people into this market because there's only one and a half percent of the world in crypto today.
[02:39] SPEAKER_00: And we're here to help you know, change that because we're just at the precipice, you know, we're at the beginning.
[02:45] SPEAKER_00: There's a lot of cliches that you can say were the first half of the first inning.
[02:48] SPEAKER_00: That's true in crypto.
[02:50] SPEAKER_00: And I've had some really exciting times some abs and flows obviously during this market over the last two and a half years, but can't couldn't be more excited about where I am today.
[02:58] SPEAKER_00: And what my teams have accomplished.
[03:00] SPEAKER_01: Well, you know, we're going to talk a bit more about the crypto in a while because I think, you know, most people listening to this are either in it or looking at the crypto.
[03:09] SPEAKER_01: And maybe we can give some insights within insider and the business if you like.
[03:16] SPEAKER_01: But before we did that, you know, you've got this new venture. You're now a public company.
[03:21] SPEAKER_01: And you know, that's a, you know, a tried and tested sort of financing route for ventures that want high growth.
[03:36] SPEAKER_01: And you know, I thought maybe you could give others thinking of this other entrepreneurs thinking of this route.
[03:47] SPEAKER_01: And you know, you know, you know, you know, you know, you know, you know, you know, that that could be really useful.
[03:51] SPEAKER_00: Yeah. Well, the first thing I've learned is if you're busy already and then you come to a publicly traded company in the CEO of that, you're not double busy.
[04:02] SPEAKER_00: You're 10x busy. What's going on and your game changes a little bit from what you're doing on a day to day basis.
[04:08] SPEAKER_00: What you're doing now and you have to want that. So not only are you inviting more scrutiny eyeballs on what's going on.
[04:17] SPEAKER_00: Questions that are going to be answered, but you're out there promoting the company in a very big way.
[04:22] SPEAKER_00: And that's what I like to do because I'm really passionate about what our businesses and what we're achieving.
[04:27] SPEAKER_00: So for me, it was a, you know, not a far cry from what I had to do to become regulated and regulation is the next level of being public.
[04:36] SPEAKER_00: You know, you had to have the okay from OSC or whatever principle, regular you're with, but to be a regulated financial marketplace and restricted dealer, then become public was a crazy, a crazy year last year.
[04:50] SPEAKER_00: And I have to say that it's very rewarding. It's very challenging. But at the end of the day, if you're doing something that you believe in, it's all part of the journey.
[05:00] SPEAKER_00: And that's what's really fun about being an entrepreneur. That's what we're talking about today is if this is hard work and you're not having fun while you're doing it, that's one thing.
[05:09] SPEAKER_00: You should probably look at something different. But if you're really, you know, enjoying it and the challenges that are coming up, which are different every single day, you don't know what's going to come.
[05:18] SPEAKER_00: And you're going to take one step for three steps back and three steps forward and four steps backwards and get punched in the gut all the time. That's what it's going to take.
[05:27] SPEAKER_00: I really recommend it because where where you can go with this is not less dilutive capital for the long term. So if you really want to scale and your business is in a position to do that.
[05:39] SPEAKER_00: Then this is the way you can find the right capital of strategic partners to come and back you to achieve those goals over a long period of time.
[05:48] SPEAKER_00: I think that's really important for us because we're so early into this marketplace of crypto that we need the people who are there, understand the vision.
[05:57] SPEAKER_00: And this is the way to identify them and you know differently than going into a typical.
[06:02] SPEAKER_00: I want to raise capital for equity piece, which is part of that that puzzle and we did a bunch of that prior to going public.
[06:09] SPEAKER_00: And we went public by a step back by reverse takeover. So you know, you may have heard of other people going public and then do initial offerings, IPOs.
[06:18] SPEAKER_00: That's where people are taking money off the table. Some of the insiders, we did this to raise capital but not take money off the table by doing a reverse merger.
[06:25] SPEAKER_00: So it's cumbersome and you have to have everything really wrapped up and if you have skeletons, your closet, you've been prepared to talk about them.
[06:33] SPEAKER_00: And if you're really need to do all those things, it's very rewarding. But it's not for everyone. It's not for every business.
[06:40] SPEAKER_00: You have to be the right place because about the story, what you can tell the street and your future potential.
[06:45] SPEAKER_00: It's not just something you can do out of vaporware or thin air. I hope that's a little bit helpful for people out there.
[06:52] SPEAKER_01: I did artios while you're right. I get what you're saying. I think it's a long term play. If you're looking to grow capital over the long term, it's a good way to go.
[07:06] SPEAKER_01: Anyway, I wanted to kind of make this a not, you know, people can go to listen to your entrepreneurial journey two and a half years ago.
[07:16] SPEAKER_01: I thought I didn't want to repeat that. But you know, here you are, you know, for the last three years, four years, you've been immersed in crypto to the point where you started your own, you know, your own operation.
[07:33] SPEAKER_01: So not everyone is sort of familiar with it. So I thought, you know, I was really interested in getting your perspective on the crypto world so that maybe some of people listening would, you know, they may be on the edge.
[07:52] SPEAKER_01: You may not be interested, but maybe by the end of a conversation, I might have a better, a better perception of it.
[08:00] SPEAKER_01: So I think the other, the first thing I wanted to say is, you know, crypto has been around for a decade, let's say, now in its current pace, about the last three to four years.
[08:17] SPEAKER_01: Is the opportunity to make money quickly gone? Is that over?
[08:25] SPEAKER_00: Yeah, I don't think the answer, well, I know the answer is no, the answer is no. This is, you know, I've mentioned it three times right today. I'll continue to do it. We're still early.
[08:35] SPEAKER_00: Does that mean that Bitcoin is going to triple? I don't know. Does that mean that this new coin that no one heard about yesterday that heard about today will go up a value 3000 times.
[08:46] SPEAKER_00: We've seen it consistently happening over the last 18 months.
[08:51] SPEAKER_00: So I'm not one who's going to sit here and tell you where you should invest your money or how you should invest your money.
[08:56] SPEAKER_00: But when you do your research and you start getting into this, you're going to see this in really good opportunities.
[09:01] SPEAKER_00: And you're going to get into, you know, it's like you can be an angel investor, which you couldn't be before for a small dollar values.
[09:07] SPEAKER_00: You can see new projects that are emerging that you can see have real world value. And if you believe in those, they're the opportunity that you can not only get into them early, but also have instant liquidity, which you wouldn't have in a typical angel investment.
[09:19] SPEAKER_00: So I think there's still definitely some opportunity there. And I think, you know, just backing up to some of the points you asked before is there's still money to be made here.
[09:27] SPEAKER_00: There definitely is and you're not too late by any means whatsoever.
[09:31] SPEAKER_01: Okay.
[09:31] SPEAKER_00: Why have we gone into this market was it was difficult. It was hard to get on a platform.
[09:35] SPEAKER_00: Hard to send money, hard to trade, 100 hard to understand pairs. And why we wanted to make it, you know, wanted to make it easier, make it accessible was so the masses could get into it.
[09:46] SPEAKER_00: And in doing that, there's a couple of things that were really key to us. I think they go and we built this community behind us and this industry based on this is we wanted to get rid of all the misdemeanors that were out there that this is a bubble.
[10:01] SPEAKER_00: There's bad actors in the space and we put a lot of those crazy stories right here in Canada. And that's why we took the regulatory approach first over everything else.
[10:11] SPEAKER_00: You know, the first Finch track regulated crypto trading asset platform in Canada in 2018 before they even allowed anyone to do that.
[10:19] SPEAKER_00: We forced them into it by adding effects into every one of our transactions. And then also being licensed as a US in Europe and being the second, you know, full marketplace here in Canada.
[10:31] SPEAKER_00: That's not because we want the titles or accolades that so that we can create for our market and for our customers a fair and transparent marketplace.
[10:39] SPEAKER_00: We can have trust in what we're doing and transparency. And so we're not only are we registered but being public everything's available to the community to understand we're not hiding behind walls.
[10:50] SPEAKER_00: I think that's the key aspect of what we're doing to try and differentiate ourselves from everyone out there and bring these new people like you're saying we're unsure.
[10:59] SPEAKER_00: Am I working with the right people? Am I in the right place? We're aiming to show that's the meeting be there for them.
[11:07] SPEAKER_00: And then to just to bolt on to that for people who don't want to get into crypto as the underlying asset and go buy Bitcoin or dogecoin or whatever it is that you're really excited about.
[11:18] SPEAKER_00: So, what's so on us taking the capital markets play opens up a different community that can come here and buy and get into the into the crypto space.
[11:31] SPEAKER_00: Through the capital markets and I think that's pretty exciting right now.
[11:34] SPEAKER_00: So, not only institutions who can't get into this because they can't own crypto in their treasury can go buy our stock and we're not a barometer and this is the differential of boss versus a Bitcoin ETF or a mining company that exists out there.
[11:49] SPEAKER_00: The price of Bitcoin doesn't reflect the price of our company and our valuation or our revenue.
[11:53] SPEAKER_00: We love volatility volatile market this being the biggest in the world the more it is volatile the more trading that goes on the more volume we have and the hence the more revenue that we make.
[12:06] SPEAKER_00: So, that's where we can come a hedge against pricing and volatility in the most volatility market volatile market and give people on both sides of it.
[12:14] SPEAKER_00: You know crypto enthusiasts a way to get into the capital markets and put them in their TFS if they want to do that.
[12:22] SPEAKER_00: The crypto curious to come in and buy crypto in a new way and that they can trust and look at and then these other investors can come in and go well I'm not interested in crypto itself but I understand that this as an exchange the true plumbing in the industry is somewhere where I can put money because they're actually a viable company.
[12:39] SPEAKER_00: So, we're trying to hit everybody across the board here so we can give them that opportunity.
[12:44] SPEAKER_01: So, what really is the future the long term future of crypto versus the economy?
[12:52] SPEAKER_00: Okay, I am not one of those conspiracy theorists or really deep rooted individuals and ethos player that says crypto is going to go sorry the that's going to go away.
[13:02] SPEAKER_00: I don't think it ever is we always have a need for it maybe not in the form of cash you know we have today we have a hundred dollar bill or a ten dollar bill or a two.
[13:12] SPEAKER_00: You know here in Canada but I think there's a real need for transparency in financial institutions.
[13:20] SPEAKER_00: Why do you go to the bank today you're trusted bank that's there for you you're in Canada there's five of them and you know we love them but why are they charging you 250 to 300 basis points for trading and one dollar American to a dollar Canadian.
[13:37] SPEAKER_00: They pay two to five basis points at the most that's almost you know predatory if you think about it if you use any other non bank was all was charging that sort of pricing you think someone was going crazy with transparency in a market and offering services on a block chain like crypto does we know the true cost we know where it goes we can move money quicker we can you know we can cut out those bloated institutions that are going to go away.
[14:06] SPEAKER_00: So we're taking half the yield that you'll be making an investment for their own fees and giving that right back to the user in a decentralized way that's transparent so I think this is just opening up the community and the world to investments and investment vehicles investment types that haven't existed or been available to them because they didn't have access to that whether it's because they're unbanked you know in the place of the world that I have that situation or they're under banked in country.
[14:36] SPEAKER_00: So I think that's a good way to move the world to a different country or they're in a country like Canada where you can't get all the products and services that you might want that are available to you in other ways that are more valuable to you so I see it as a new way of thinking about investment a new way to move capital in a transparent way and something that's going to change the future on how we interact in a digital world.
[14:57] SPEAKER_01: So let's move to what's probably been an even crazier area of crypto in the last six months as NFTs you know NFT child is everywhere.
[15:08] SPEAKER_01: How is that relate with cryptocurrencies the bitcoins and etc.
[15:13] SPEAKER_00: So sounding self promotional.
[15:17] SPEAKER_01: Yeah.
[15:18] SPEAKER_00: The reality for us you know us as an exchange again going back to a capital markets company in exchange you can't have NFTs and you can't have a metaverse and you can't have defy products without a centralized exchange like us all this exists because you have to bring real fiat dollars like I said they're not going away on to a market then you can take it from our market and deal with any of the products that we have or go somewhere else the products that we have.
[15:43] SPEAKER_00: We can't offer based on regulation here in Canada and use the fee use the crypto that you bought from us on ramp and offer and I think it's really interesting that NFTs have taken so far but they're really excited for this one community whether you're into crypto or not but you have to use crypto to buy them and I think that's exciting and what it is for those who don't know.
[16:05] SPEAKER_00: So NFTs are three letters for a stand for non fungible token so that saying that at the end of the day and you can't see me I'm just saying but I have a piece of art on my wall over here there's only one of those in the world I can't take that and exchange it for another painting that similar like you could one dollar bill for another dollar bill and because that's non fungible there's only one of one we can say that you own that.
[16:32] SPEAKER_00: And we can actually have that on a blockchain where we know the provenance provenance of that so for example we know that that Banksy painting that happened was bought by JZ who then sold it to this person that sold to that person we know the lineage of where it went and that it's truly an authentic piece of art or memorabilia or of the like so this is just the beginning of NFTs and it is very exciting and it's all about digital art right now.
[17:04] SPEAKER_00: And it's about collectibles but that's not where I see it going into the future and I think that's the important conversation to be had today where fractionalization based on NFTs I think is very important and you know I'll talk about a company that I know it's called willow and willow what they do is they fractionalize and I think they just became OST and CSA registered as well which is a very interesting thing.
[17:31] SPEAKER_00: Where they fractionalize real estate so now you want to be a real estate investor but you can't afford that million dollar down payment to have that sixplex in Canada now you can bring a consortium people together instantly you know taking 30 seconds to write up what you're doing the building all the details are coming pulled from online and now you can crowdsource essentially a million investors at one dollar then go buy that building management the way you had hoped to have the business plan behind it and show.
[18:01] SPEAKER_00: So if you want to return back you can do the same thing with a sports team or a fancy car or whatever it may be and that's where we're going in the future again bringing access to financial instruments that might not be attainable like everyone to now make everyone how the ability to attain that and I think that's really key.
[18:21] SPEAKER_01: So is this the right timing to invest I mean the crypto market has been bouncing bouncing bouncing or should I wait for me not for not not where you said you know the you know the spit the fact that there's lots of trading is great but as the individual is it is it is it just to volatile at the moment.
[18:46] SPEAKER_00: Well you know again I think where we are we've seen it you know Bitcoin will just talk about that Bitcoin's king it's the brand.
[18:54] SPEAKER_00: Yes we've seen it high is 69,000 us we've seen it as low in last two years as low as 3000 us so it's very volatile but you know these are the times that I would dollar cost average into the market we just saw it come down from 50,000 to 36,000.
[19:14] SPEAKER_00: You know we we have a saying here I won't say the word because it's crude but it's called BTFD you know by the something dip when the when the market is going down and it's going opposite we see a lot of people selling you know the panic selling hold on you know if you think that it's a bad time to zoom out to see what the charts look like over time not in that individual period and when we see a dip in the market under what we call like a natural band of you know where we see some of them.
[19:44] SPEAKER_00: Resistance over time that's let's where you should be buying in my opinion and you should own it at various price points and that's what dollar cost averaging is so I would say at any time in the market that you see it dip down that would probably be the opportunity to buy or start trading on it.
[20:00] SPEAKER_01: So I mean with tax time looming is crypto investing tax advantageous.
[20:10] SPEAKER_00: Well we're just starting to see some real guidance from the CRA on this I just reading about this early this week you put out some post on it.
[20:19] SPEAKER_00: They're treating it much like any other investment out there so it can be advantageous you know if you're taking some losses and you need to write off at the end of the year maybe you want to solidify that by selling some at a loss and on the other side is tax like a capital gain so I think those are all positives in our in our country here in the market.
[20:39] SPEAKER_00: So I think it's nice that we're seeing a little bit more guidance on that and I'm still learning about that so I don't want to anyone take that with the grain of salt and definitely talk to your account into about that but that is what I'm seeing I feel confident about that being the proper approach to how this is treated.
[20:54] SPEAKER_00: So I'm moving in crypto should I be using the crypto wallet.
[20:58] SPEAKER_00: Oh well there's a couple ways of looking at this you know they say it is a saying in crypto not your keys not your crypto that means if you don't have your own wallet and it's under your control and no one has access.
[21:11] SPEAKER_00: Maybe someone can get access to it so it's always a good idea to have that I think that was very significant for a long period of time but as regulation comes into play and it is significantly worldwide not only here in Canada.
[21:26] SPEAKER_00: You know there's a lot of things like it's not the wild wild west anymore we have to have anything that we're holding on behalf of our customers has to be 95% in cold stores so offline at a real trust company just like your stocks and bonds are held with the trust company that also has to be insured we also have to have self insurance on things that are in a hot water and transactional wallet at a time these are things that are audited on a internally very often through the regulators.
[21:56] SPEAKER_00: Also you know monthly if not more across the board so there's a lot of things are being put in place to ensure that your coins are secure especially dealing with a company like ours.
[22:05] SPEAKER_00: So I think and there's reasons for that and I get it and it might be a cost center but it's safety and transparent and I like that.
[22:12] SPEAKER_00: So there's not as much reason to have it on your own especially because there's rationale to have an on exchange where a you can go trade it at will.
[22:21] SPEAKER_00: And you have to bring it on an offline like you would in an intracial sense of having a cold wallet or a mobile wallet which could get lost as well.
[22:30] SPEAKER_00: And I think at the end of the day we're really just creating an environment where in an involving environment where there's so many places that you might want to stake your coin or lend it out to receive very high yield payments back you know you can get upwards of 20% a year on your cryptocurrency that you have.
[22:49] SPEAKER_00: Where if you're keeping dollars in your bank account you're making pretty much negative interest in a lot of these markets so it's important to have and I think you should you know if there's stuff that you're just playing holding for a really long time for 10 years five years whenever maybe have it in your own wallet there if it's something that you're looking to spend and use daily actively having a mobile wallet so you have access to it.
[23:11] SPEAKER_00: But then I think you can feel really confident in the centralized exchanges and the in the secure they have behind it to keep dollars there or yeah there are crypto there.
[23:21] SPEAKER_01: So let's move out just a little bit from from the kind of crypto advisory if you like that we just mean through and just come back to you a little bit you know so here you are you know you're you're you're.
[23:39] SPEAKER_01: So leading something that's that's got a lot of momentum you know what do you see yourself what what's your biggest challenge for the next you know two years you would say.
[23:52] SPEAKER_00: My biggest challenge is really finding the best team members and we have a little bit of advantage being crypto so interesting we've taken some incredible individuals you know our chief compliance officer chief legal officer marketers from the best in their industries all the way.
[24:08] SPEAKER_00: So we've got a lot of really traditional industries and how bring them to our team but it's really scaling more of that so that we can move out of scale in which crypto currencies moving at the same time so I think that's important to understand that our market doesn't look the same like it did three days ago or did three months ago it is ever changing and finding people who can keep up with that one to who can scale and move as quickly as we are is key so finding the team building team and move forward there keeping up with technology working hard with.
[24:38] Speaker UNKNOWN: So we can bring up with a lot of things that we can do with other players to bring very.
[24:41] SPEAKER_00: We have positive change to an into an industry to allow us to offer product that other people want to not go off to other jurisdictions to get and I think those are the things that we're most focused on to ensure that we continue to see this immense growth and you know building great product and our goal is to give the best customer success and experience bar none really only crypto asset training platform the world.
[25:08] SPEAKER_00: The offers on the channel live support 365 24 seven and that's key we want to be there for our users when they're thinking about it when they're doing their first trade or their thousands trade we want to make sure that we can service them because of that 30% of organic growth comes from our evangelistic clients that we do a good job for referring their friends and family so that's a key aspect for us moving forward.
[25:34] SPEAKER_01: Yes and been really interesting thank you for coming on I'm going to keep tracking you you keep tracking us.
[25:43] SPEAKER_01: Like I said the last time you know lots of people listen to our stuff how can people get a hold of you and say like what they've heard.
[25:51] SPEAKER_00: Yeah absolutely I've had a lot of incoming queries before because of this I'm happy to do that to reach me at jh at coin smart dot com as jh at coin smart dot com semi an email I'll be happy to get back to you as soon as I can any questions a good question happy to help where I can.
[26:10] SPEAKER_01: Thanks very much for coming on this podcast.
[26:13] SPEAKER_00: Thank you so much have a nice day.
