Caitlin Long 🔑 Profile picture
Founder/CEO @AvantiBT. #bitcoin since 2012. GovGordon appointee to Wyoming #Blockchain Select Committee. 22-yr Wall St veteran. Not advice;not views of Avanti!
Leo Profile picture ☀️💧Leon-Gerard Vandenberg 🇨🇦🇦🇺 Profile picture Arne Vaagen Profile picture Steven K.N. Wilkinson Profile picture Johannes Ernharth Profile picture 27 added to My Authors
26 Sep
WHOA! What a speech by @CynthiaLummis (almost certainly about to become a US Senator) re why #bitcoin is a store of value, which may rise to be an alternative to the US dollar."I bought my first #bitcoin in 2013 bc I believe in the economic power of scarcity...now I'm a HODLer"🤠
HOLY COW--this is a stunning speech!
She just attacked the Bank Secrecy Act!
Read 7 tweets
16 Sep
1/ IT'S OFFICIAL!!! Welcome to #Wyoming, @krakenfx!

🐙+🤠=🔥🚀🎉

What a win-win for #crypto & Wyoming! As of **NOW** Kraken has a US bank charter—a 100% reserves-required, audit required (w/ #ProofOfReserves), custody via legal bailment, no #rehypothecation type of bank!🤠
2/ The vote of #Wyoming's Banking Board just concluded & it was UNANIMOUS! It took 27 months for the first #Wyoming SPDI to obtain a charter—congrats to the dozens of people who made it happen, esp @GovGordon, @TylerLindholm & Wyoming legislators & the Wyoming Division of Banking
3/ I’ll be back w/ more analysis later. Next applicant in line for #Wyoming SPDI is @AvantiBT later this Fall (more are on the way). But today is @krakenfx's day. As a shareholder, I'm so happy for @jespow & Kraken team! Applications for this charter opened a yr ago--took longer
Read 5 tweets
23 Aug
1/ JUST READ opinion in latest lawsuit against #crypto exchanges/custodians over whether customers are owed forks/airdrops. As discussed on podcasts (@APompliano, @PeterMcCormack, @stephanlivera, @PrestonPysh+others), these contracts tend to be 1-sided...
law.justia.com/cases/californ…
2/ ...& judges generally will uphold the contract to which parties agreed, so breach of contract & conversion claims not likely to win (& they aren't). This is why these 1-sided contracts are a prob for institutional investors who owe a #fiduciary obligation to their customers...
3/ ...a fiduciary asset manager who agrees to a vague, 1-sided contract will get sued by its clients for breach of fiduciary duty if something goes wrong (& if it's an #ERISA fund, that fiduciary has PERSONAL liability & will be sued personally, not just sued professionally)...
Read 9 tweets
6 Aug
1/ MORE ANALYSIS-Goldman's new head of #digitalassets is a #repo trader based in LONDON. This is significant bc UK law basically has no limits on #rehypothecation. To be clear I'm not worried abt #bitcoin--as a system it's immune to WallSt's leverage games
2/ That doesn't mean its price won't be impacted tho--bc #rehypothecation fulfills real demand w/ artificially created supply & thereby suppresses price, all else equal. Rehypothecation works as long as there's a lender of last resort. But #bitcoin has no lender of last resort!🚧
3/ So, how many times could a #bitcoin be rehypothecated? In UK there's basically no limit bc the broker/dealer takes outright title to the customer's asset. This is why Lehman transferred so many of its assets to its UK subsidiary from its US subsidiary. kramerlevin.com/en/perspective…
Read 6 tweets
3 Aug
1/ JUST BACK from an amazing #roadtrip across my beautiful native state. Here’s #YellowstoneFalls from Artist’s Point—yep, this is real.

Next—warning, I’ll post photos of historically important firearms at Buffalo Bill Museum in Cody, #Wyoming to illustrate 2 points about tech. Image
2/ Point #1: after centuries of no major advancement in firearms tech, a MASSIVE innovation occurred w/in a 10-yr period right before the US civil war & it’s visible in this exhibit. Invention of the repeating rifle changed the world—literally. Details abt why aren’t important... Image
3/ ...for this tweetstorm. What matters is that the invention MASSIVELY advanced tech in the industry by rendering everything that came before it utterly obsolete.

The analogy to payment/ledger technology is obvious. This is what #blockchain is doing to legacy payment systems.
Read 6 tweets
25 Jul
1/ HERE'S AN EXTREMELY DETAILED article re: all the "regulatory theater" in #crypto prime brokerage today. It's prob moot now that at least 1 national bank is entering (so non-bank regulatory structures for crypto r obsolete). @ChrisKentouris @finopsreport
finopsinfo.com/trading/prime-…
2/ I'm SO GLAD native #crypto cos r close to receiving #bank licenses, so the big national banks won't entirely co-opt native crypto cos in US market. Bank licenses are far superior to existing regulatory structures used in US crypto (@APompliano about to release podcast on this)
3/ The @finopsreport article details why a #bank license is superior to trust charter or #BitLicense--banks have much higher capital & reg rqmts, r directly plumbed into Fed, much better bankruptcy treatment for customers, only banks have safe harbor as "qualified custodian"+more
Read 4 tweets
23 Jul
1/ GAME ON! The @USOCC's announcement that it's following #Wyoming by allowing national banks to custody #digitalassets is GREAT news for #crypto! Long overdue & hopefully will help U.S. regain ground it lost to other developed world countries by dilly-dallying for so long.
2/ Winners=customers & #crypto VCs. This will spur M&A boom as US banks acquire #digitalasset custodians. Most must sell bc:
a. trust co. charters now obsolete &
b. #BitLicense now obsolete 👏

bc @USOCC leapfrogged 'em. Custodians now MUST have a bank charter to be competitive.
3/ But @USOCC didn't leapfrog #Wyoming, bc we already offer a bank charter.🤠

What's the distinction? A bank license was **ALWAYS** the optimal US regulatory structure for crypto custodians--not a trust charter or #BitLicense. Bank charters are SO much better for #crypto custody
Read 25 tweets
21 Mar
1/ EPIC DOUG AGAIN TODAY☕️No one deserves a victory lap more than Doug for predicting the carnage from burst credit bubble-but he doesn't. Class act. He focuses on what's next. Reading it makes me proud of #Wyoming for enacting a 100% reserve bank charter.
creditbubblebulletin.blogspot.com/2020/03/weekly…
2/ SORRY NEW YORK, the center of finance in US is about to decentralize to places like #Wyoming (yep🤠), which are already in process of standing up new banks w/ pristine balance sheets, carrying no legacy from prior mess. (Disclosure: I'm working to set up one & so are others.)
3/ NEVER HAS THE NEED for new banks w/ pristine balance sheets been clearer. As Doug points out, bubble finance is OVER. Deleveraging isn't done yet. There's no locomotive in the world to enable re-inflation of the prior bubble (nope, not even China-whose debt bubble also burst).
Read 14 tweets
17 Mar
INTRODUCING AVANTI's LEADERSHIP TEAM! @kanzure CTO, @zshimko COO, Chuck Thompson CLO/CCO, Britney Reddy chief of banking ops/CFO. We've seen A LOT MORE interest in what we're doing, given the environment, & many have expressed a wish that we were already in biz. We're sprinting!
2/ Many know @AvantiBT's CTO, #Bitcoin Core dev @kanzure, who has a track record of building a secure #bitcoin custody platform for @ledgerx + created Bitcoin Vaults (a pre-signed anti-theft recovery & clawback mechanism for bitcoin). He prvsly worked w/ tech partner @Blockstream
3/ Many also know @AvantiBT's Chief Legal Officer/Chief Compliance Officer, Chuck Thompson, who worked w/ @kanzure at @ledgerx. Chuck helped build reg compliance program there + has consulted since. We almost crossed paths at @MorganStanley & have known each other since 2015.
Read 5 tweets
14 Mar
1/ HOW TO UNDERSTAND WHAT'S GOING ON IN FINANCIAL MKTS. Western world built up a debt bubble of stunning proportions over past ~50yrs. It's deflating now, just as it tried to do in 2008, 2001, 1997, 1994, 1987, 1981 & 1974. Each time, tho, there was enuf balance sheet capacity...
2/ ...to reinflate the system by pumping more debt into it. In other words assets still existed that hadn't yet been encumbered by debt (directly or indirectly)--meaning the countries were SOLVENT. That's why their fiat currencies had value--assets were still available...
3/ ...that lenders didn't yet have a claim upon (ie, assets not yet mortgaged). Important to understand that when debt expands, liquidity grows--& mostly it just pushes up financial asset prices (for vrs. reasons). Reverse is also true. Debt has grown for ~50 CONSECUTIVE years...
Read 24 tweets
10 Mar
1/ THOUGHTS ABOUT RUSSIA, which helped precipitate today's oil price crash by increasing oil production amid the #coronavirus-induced demand slump. This isn't the 1st time Russia took a run at the US & the West, but this time it just might work. Deep history here, so bear w/ me.
2/ Punch line: Russia has a strong balance sheet bc sanctions essentially blocked it from Western financial system for yrs so it couldn't lever up as most others did. This saved it from yet another debt trap. Yep it prob can weather $25-30 oil for 6-10 yrs:cnbc.com/2020/03/09/reu…
3/ Wouldn't surprise me, since Russia's oil costs are in rubles & its revenues are mostly in US dollars. Here's what I wrote about this phenomenon in 2016 when my curiosity about Russia's history took me on a 10,000km trek across Russia on the Trans-Siberian Express for ~3 weeks:
Read 14 tweets
9 Mar
1/ THINK TODAY'S CARNAGE is oil+#coronavirus? It isn't. It's abt balance sheets. And no one is even talking abt the carnage to corp balance sheets from #pension liabilities given huge drop in long-term interest rates--the avg corp pension liability just went up ~20% & funding...
2/ ...pmts are coming due shortly for many. They will go up bc int rates plunged--a hit to free cash flow. Pick @Boeing as just one of many examples. Guess what--it had NEGATIVE $8.3bn of shareholder equity at 12/31/19, caused by its big pension deficit. Here's a screenshot:
3/ Its total pension liab was $77.6bn at 12/31/19, using a discount rate of 3.3%. The drop in AA-corp bond yields (which set the disct rate) since 12/31/19 has been HUGE (guesstimate it's 1% & guess the pension liab has a ~10yr duration, so the pension liab is now ~10% higher).
Read 9 tweets
9 Mar
JUST FOR FUN...looked back at all the times I urged big banks to raise equity capital bc they were too leveraged, in spite of mainstream view that they were fine. I'll retweet a few here. First one dates from 2016. HEY BIG BANKS, YOU'D BETTER RAISE EQUITY CAPITAL NOW...FAST!!!!
Read 8 tweets
29 Feb
1/ "The global credit machine is grinding to a halt." That's why fin mkts are seizing--China was the marginal source of credit creation globally for yrs, & fin mkts depend on credit creation to keep prices high. Price discovery has been distorted for yrs. creditbubblebulletin.blogspot.com/2020/02/weekly…
2/ As usual, my Saturday☕️ includes reading Doug Noland's #CreditBubbleBulletin--he has carefully chronicled colossal credit bubble for years. Historians will view his contrarian work as invaluable to understanding why things happened as they did, & not as mainstream predicted...
3/ A few nuggets I've concluded from experience+yrs of reading Doug & others who truly understand what's going on:
* Big banks aren't well-capitalized enuf to handle this; shld be raising equity capital FAST. This was clear last Fall during #repo scare--long b4 #coronavirus hit
Read 8 tweets
24 Feb
1/ INTRODUCING AVANTI BANK, a new US #bank to serve #digitalasset industry, offering new products & svcs not currently available in USD mkts along w/ tech partner @Blockstream. #Wyoming-based. We’re preparing long process of charter application & aim to open early 2021. @AvantiBT
@Blockstream @AvantiBT @adam3us 2/ Co-founder/team news soon. I’ve founded @AvantiBT w/ key support from top people in #crypto + important innovators from traditional finance. Seed funding round recently closed. Avanti will serve institutional customers that need services around #Bitcoin & #cryptoassets.
@Blockstream @AvantiBT @adam3us 3/ A critical piece of US mkt infrastructure is missing—a regulated #bank that can act as bridge to Fed for pymts + custody #crypto for BIG institutional money (pensions/endowmts/foundtns/corps/sov wealth) who need this b4 entering #crypto in a big way. Regulation had blocked it.
Read 29 tweets
7 Feb
1/THINKING MORE abt @HesterPeirce’s proposal for a token safe harbor, which really does advance the ball re US SEC issues. As per my pvs tweets, there are issues that still need to be addressed—basic one is whether the tokens are presumed securities during the safe harbor or not.
2/ If yes, then the proposal opens at least 2 cans of worms—the custody question + creates probs for issuers outside the US (where many countries recognize that tokens aren’t necessarily securities but if the US thinks they’re securities then other countries may follow)...
3/ The custody question is YUGE. If they’re presumed securities, then the Custody Rule & Customer Protection Rule probably apply. This means custodians must provide “good control location” (among other obligations), but there’s zero clarity on what that means for security tokens.
Read 9 tweets
25 Jan
1/ GREAT NUGGETS of wisdom from Doug Noland's post...gets me thinking on Saturdays☕️. FIRST, is #coronavirus just usual media fearmongering or a tragedy that could prick the huge credit bubble? Just
as banks can stay liquid LONG after they're insolvent... creditbubblebulletin.blogspot.com/2020/01/weekly…
2/ ...entire economies can stay afloat long after their balance sheets are used up too, as long as credit keeps flowing. Credit capacity for most of the developed world is mostly used up (it's why interest rates are negative in many places), but they're still afloat. Why?
3/ ...Because no event has yet triggered a reckoning that reveals the insolvency. (Again, banks can stay in biz for a long time after they're insolvent.) Markets clearly worry that #coronavirus might be such a trigger--Doug details the huge mkt moves this week in reaction to it.
Read 18 tweets
11 Jan
1/ THIS IS WRONG BUT IMPT TO DISCUSS WHY: “The fundamental vulnerability of the current financial system remains the absence of a true lender of last resort for non-US banks carrying huge US dollar liabilities.” ft.com/content/5f8237…
2/ Reposting impt article from @FT. It shows how the mainstream thinks—right diagnosis prob, wrong solution. Prob: there’s a YUGE short position in US dollar that has built up over past couple of decades—vast majority is offshore. Per article, @IMFNews estimates it’s $1.5trn...
3/ ...(“dollar funding gap”) but truth is no one really knows bc it can’t be accurately measured. Non-US banks created USD liabilities for non-US borrowers to facilitate global trade, but non-US banks don’t take deposits in USD so need to go to capital mkts to fund the USD gap...
Read 8 tweets
11 Nov 19
1/ NEWS out of #Wyoming ahead of #ConsensusInvest, previewed by Chris Land, gen. counsel of WY Banking Division at #FordhamLaw #blockchain regulation conf today:(1) solution to #BitLicense prob for #crypto cos=open a NY branch of a WY SPDI; (2) Wyoming just released custody rules
2/ Chris explained today that #Wyoming #SPDI, which is a state-chartered bank, is a passport into ~42 US states w/o need for addl state license. In the other states, such as NY, it may need to open a branch. Federal law protects parity of national banks & state-chartered banks...
3/ ...of other states, so if a state exempts a national bank from a regulation, then other state-chartered banks are exempt from it too. Thus...drum roll...since NY law exempts national banks from the #BitLicense, #Wyoming's #SPDI almost certainly exempt too (NOT LEGAL ADVICE!)
Read 8 tweets
17 Aug 19
@mikebelshe @Melt_Dem @fintechfrank @jillruthcarlson @BitGo 1/ There’s a huge difference & I’m glad we’re discussing it—sounds like Bitgo offers a CONTRACTUAL right of ownership, but #Wyoming law guarantees customers a direct PROPERTY right, which is superior. Huge difference in a bankruptcy, where bankruptcy judge can break contracts...
@mikebelshe @Melt_Dem @fintechfrank @jillruthcarlson @BitGo 2/ ..but in #Wyoming the law makes it clear that a bankruptcy judge cannot grab customer assets to satisfy a shortfall, using customer assets to socialize losses. All other states’ laws are silent on this issue, which means bankruptcy judges (& state regulators) have no roadmap..
@mikebelshe @Melt_Dem @fintechfrank @jillruthcarlson @BitGo 3/ ...so the outcome is unpredictable. The first question a fiduciary will ask is “what happens if my custodian goes bust?” bc they have fiduciary liability—& there’s only one state whose laws can answer that question at all (#Wyoming). In the absence of such legal clarity, the..
Read 7 tweets
15 Jul 19
1/ The Senate Banking Comm staff reached out last week regarding @Facebook @Libra pursuant to my @ForbesCrypto article. During a conf call they indicated interest in receiving formal testimony from me. Here it is + summary follows 👇: forbes.com/sites/caitlinl… @DoWithCare
2/ Big takeaway--politicians that weaponize the US banking system (blocking access to disfavored industries/countries) are modern-day Herbert Hoovers bc these barriers block both unlawful & LAWFUL commerce, & these barriers caused the invention of #stablecoins in the first place.
3/ (OK, I didn't actually call them modern-day Herbert Hoovers the testimony, but I digress...) If Congress isn't happy about @facebook @Libra, it can immediately make #stablecoins irrelevant by letting #banks bank the #crypto industry (& I give v specific recommendations here:
Read 19 tweets