Nicola Tangan: Hi everybody and welcome to In Good Company. I'm Nicola Tangan, the CEO of the Norwegian Sovereign Wealth Fund and today I'm joined by Brian Armstrong, the co-founder and CEO of Coinbase, which is America's largest crypto exchange and increasingly one of the powerful forces shaping global finance. So Brian, warm welcome.

Brian Armstrong: Thank you for having me.

Nicola Tangan: Now 13 years ago, nobody trusted crypto and today nobody can ignore it. And so what happened really?

Brian Armstrong: Well, I know, I first read about Bitcoin in December of 2010, and it was describing how there could be a a decentralized network to move value around the world. Kind of like the internet was for moving information, but this was for moving value. And, you know, it was initially didn't get much attention. Only people that were computer science PhDs or, you know, libertarians or anarchists were excited by it in these small forums on the internet. And it slowly grew over time. Um, and of course, Bitcoin was the first asset that got created, kind of like this digital gold standard, but quickly the technology evolved to be, you know, blockchain as a broader concept. And so, people made all kinds of things. They made ways to trade other asset classes like commodities and equities. They made stable coins for better payment rails. Um, they made prediction markets. And so now, I think we're in a world where crypto is actually updating all aspects of the financial system. Um, it's not really just about Bitcoin. It's it's about payments. It's about borrowing and lending. It's about capital formation. And how can this technology actually make financial services more efficient and more global, more fair, and more free all over the world. And so it has increased in trust quite a bit. I think the things that have helped that have been number one regulatory clarity, which we're seeing emerge now in Europe um and and other in in the United States. We got legislation recently passed for stable coins. Um we're also seeing adoption by the largest institutions in the world. So, you know, there's lots of uh Bitcoin ETFs now and fund like Black Rockck and Apollo have come out and said they want to tokenize all of their funds. Companies like Visa and JP Morgan are running experiments with how to do stablecoin payments. And so, I think these trusted institutions coming in has also been another factor in addition to the regulatory clarity.

Nicola Tangan: But I mean you you worked at Airbnb back in the days and you watched the crossber border payments fail uh and then you figured out you needed to change the whole the whole system, right?

Brian Armstrong: Yeah, that did give me a front row seat into how broken the global financial system was in certain situations. Um at Airbnb, we were trying to move money to 190 countries around the world, both collecting payments from guests but also paying out to the hosts, people who were listing their homes. And in many countries, it was very difficult for Airbnb to route money like to do payouts to Uruguay or somewhere like that. It might cost seven to 10% in fees, take three to five days to get ar three to five business days to arrive on the other side. And so working as an early engineer at Airbnb certainly gave me a front row seat to that. I had also spent a year living in Buenesarus, Argentina and I had seen that country go through hyperinflation a little bit at least and I it gave me a profound sense of how much that changed the culture of a country and really held back progress. You know, high inflation can really hurt the poorest people in society. So there was a few pieces like that that helped me see the potential of crypto.

Nicola Tangan: So So when you first uh read the um the Bitcoin white paper, what was your immediate reaction? What do you think?

Brian Armstrong: You know, I it really captivated my attention. I remember having this thought like this might be one of the most important things I've read in a long time. And I didn't fully understand it the first time I read it. It's it's only about 10 pages long. You could any, you know, anybody can go read it. It's actually I think it's worth people going to read it. It has some math. It has some computer science, so it's not the easiest thing to digest. It took me a number of times to reread it and really go try to implement the protocol myself to fully understand it, but it was a true computer science breakthrough. And it showed how, you know, you could have provable scarcity in a digital world. Um, and in previously that was not possible. So, you know, if you have like a photo on your phone, you can send a copy of it to someone else. And like in the digital world, infinite copies are kind of the norm. And this algorithm really showed how you could have provable scarcity. So, if there was a unique digital item, it was provably unique mathematically and there weren't you couldn't have people just make more copies of it willy-nilly around the world. So that allowed the initial you know use case was bitcoin this kind of digital gold but then that people applied that same technology to tokenizing the dollar tokenizing stocks um tokenizing you know memecoins NFTs and all the kind of crazy stuff that happened in crypto too. I mean just to say it I think crypto attracted a lot of kind of bad actors as well and that that created reputational issues early on. But um

Nicola Tangan: what does it feel like to bang on about something that nobody believes in?

Brian Armstrong: Well, I think that's the nature of entrepreneurship. You have to see something early and be and be right. But it can't be a consensus view at that time. Otherwise, you're too late, right? Like now everybody is very excited about cloud computing or even like I would say AI or whatever. These are just very mainstream views at this point. It's probably too late to start one of the foundational AI companies. It's too late to start one of the foundational cloud companies. So as an entrepreneur, you're always kind of looking to things that are early that are not well uh liked and not well appreciated and sort of seeing is there actually much more here than most people are recognizing and if you see that gap between consensus view then you have an opportunity to go commercialize it. So for me you know I've always I guess this is partly why I think um you know some entrepreneurs are like a little on the spectrum you know they they just they don't care as much about social cohesion.

Nicola Tangan: Are you on the spectrum?

Brian Armstrong: I would say so. Yes. I I've I've never been formally diagnosed, but I've taken various tests and things like that just myself and I've I score somewhere on the spectrum for autism. Yes. And I think that that is over represented in entrepreneurs.

Nicola Tangan: Why is that?

Brian Armstrong: Well, there's autism can can present itself in many different ways, but um you know, I think one of the ways it presents is that you care a little bit less about social cohesion. you know, you you're you know, sometimes I'll be in a meeting and um I ask a question and I I know I know people might think it's a dumb question, right? But I genuinely I genuinely don't understand it and so I'll I'll ask um I I'll say well actually why why do people buy that product, you know, and and and everyone, oh it's obvious like you know this brand is loved and whatever. I'm like but is that really you know so I'm okay asking dumb questions looking a little silly. I I just I'm more interested in finding um unique insights and advancing civilizational progress by trying to build cool things in the world. Like that's that's what really motivates me and I just I find it fun. Um and so anyway, yeah, if you look at some of the not all entrepreneurs obviously are on the spectrum, but I think it is over represented.

Nicola Tangan: Well, Mark Andrean told me that he thought you were one of the cleverest people he ever met, so you must be quite clever.

Brian Armstrong: I feel that way about him, too. So, thanks a good compliment.

Nicola Tangan: Uh now you call it uh you call it the everything exchange. So stock trading, crypto, custody. Um so are you building a bridge to traditional finance or are or is this the end of traditional finance?

Brian Armstrong: No, I think it's an evolution of traditional finance. So we are building the everything exchange uh which is bringing every asset class uh into one tradable platform. So you have not only crypto assets uh which of which there are millions now but you have stocks, commodities, FX um you know I think prediction markets is another big category that's taken off and I think you'll actually see all capital formation get uh changed in crypto here relatively soon where it's easier to raise money and then go through the process of being a private company eventually being able to go public totally on chain. Um and then of course it's not just trading like crypto is actually updating these other categories of finance as well, right? Payments and borrowing and lending and everything. So yeah, it's it's a pretty broad technology.

Nicola Tangan: Now there are other uh crypto exchanges too. Why should you win against them?

Brian Armstrong: Yeah. Well, we've tried to differentiate really by being the most trusted brand in crypto and that's allowed us to then custody more crypto than any other company in the world. And you know by custoing more crypto we then try to connect more products into that into those that custody and it makes the product sticky. Um it gives us a certain amount of margin pricing power. We can use that to go build new products. So it's really comes from that trust. Uh that comes from taking a compliance approach following the law being good at design customer support. You know there's lots of areas that trust can come from being based in the United States being a public company with audited financials. you know, we've benefited from all these things to build the most trusted brand, the largest, we're the largest provider to institutions as well for crypto services. And then, yeah, that trust has allowed us to now store about more than 12% of all the crypto in the world, which is more than any other company we're aware of. That's been growing over time. And um is again connecting more products into those deposits and then we can actually um generate more revenue from that and and reinvest it. So, that's been our expertise and strategy so far.

Nicola Tangan: Why is crypto so volatile?

Brian Armstrong: Well, Bitcoin is volatile. Um, you know, not all but of course like stable coins are very stable, right? So, you know, Bitcoin was especially volatile early on because it was so new and there was only there were relatively small number of people in the world holding it. Now, it's gotten a lot less volatile over the last 10 years as the market cap has grown and I would say it was probably the best performing asset of the last 10 years by most measures. Um and so it went through like it's a little bit like the internet right the internet went through these bubbles and crashes as well because people oscillated between this is the future of everything to you know despair and every cycle that crypto or specifically Bitcoin has gone through it's gotten a little bit less volatile like the the peak to trough has been a smaller percentage because more people in the world are holding it now you know there's large ETFs there's a lot of institutional holders there's now a strategic Bitcoin reserve for the United States government, other sovereign wealth funds are holding it. Um, so as that regulatory clarity has emerged, it's created a larger base of holders and I think that's decreased the volatility.

Nicola Tangan: Now, why are stable coins more important than people think?

Brian Armstrong: Well, I think a digital dollar is very still underappreciated and could grow 100 or thousandx from here. Um, the reason is that uh payments are still relatively high friction around the world right now. you know, in certain countries, um, like I'd say in Brazil with Pix or in India with UPI, like they've managed to get payments to be quite fast and cheap, but they work only within that one country. Other countries like in Europe, they have um instant bank transfers that are very that are free essentially, and that's that's a really good feature. But if you look at most payment methods uh whether it's credit card or swift or anything and you kind of look at these three dimensions like the cost, the speed and then the global reach. So they're, you know, let's take credit cards for example, like they have pretty good global reach, but they have high cost, two to three% on every transaction, and they're quite fast, right? If you look at Swift, it has good global reach, but it's expensive. Um, and it takes like I think what two to three business days or something like that. And so if you cry, stable coins are the only payment rail that checks all three boxes. It's fast, cheap, and global. So you can now send stable coins instantly in less than 1 second anywhere in the world for less than a tenth of a cent US. And so payments are like water. They kind of flow to the path of least resistance. And I think that's why we're seeing such enormous growth in stable coins. I think it grew about maybe 100% year-over-year last year. And um more and more of global GDP I think will run on stable coin rails.

Nicola Tangan: Who are the big users of this?

Brian Armstrong: Well, some of the early adopters of it were uh for B2B B2B crossber payments. That seemed to be an early use case that was least well served by the traditional financial system. You can imagine many companies out there, they're sourcing goods goods from you know Asia or Europe and um these wire transfers and you know there's FX risk, there's settlement counterparty risk and they take sometimes five days like if you're you know moving crossber payments between for your company. So that was a that's been a huge emerging use case for stable coins. Um we're also starting to see it be used in e-commerce and peer-to-peer payments like people sending money home to their family in other countries as an example with that like with remittance and um yeah I think that eventually it should eat more and more of every every payment category right payments e-commerce um but the B2B crossber payments have been the largest driver so far.

Nicola Tangan: What's the practical difference between a stable coin and a central bank digital currency?

Brian Armstrong: Well, this is a big debate. So, when I go meet with other central bankers, um they often tell me they would like to create a central bank digital currency. And I tell them, okay, that's great. You know, we we we want crypto to be adopted by everyone. Uh what I've noticed is that they often don't end up launching it though. Um you know, governments are really good at setting policy and they they are not as good at building software, right? Um, and so they can sometimes work with an outsourced vend, you know, they can the government can hire a technology vendor to come in and build that. But what typically works best I've seen is that if the government sets the policy, the private market can go provide those solutions. And so that's what we've seen happen with the stable coins. So far, the largest have been privately um privately issued, but you know, in the US at least following a regulated standard. There's one other aspect of central bank digital currencies which is that I'd say they're they're somewhat polarizing because some people really have concerns about the uh the privacy aspects of that that if the government is issuing a central bank digital currency that it could end up with some kind of social credit score where you get you know your money turned off by the government and um you know so China for instance has created a central bank digital currency their digital R&B or digital yuan um and they see it as a tool for control. In my view, um they this ch the Chinese people are very excited about decentralized cryptocurrencies. They're but the Chinese government fears it as a way of losing control. So they they've been much more advocating for a central bank digital currency that they control, the digital yuan. Um I think the rest of the world needs to figure out which side they're going to be on. I can tell in the US right now it's leaning very much more to like privately issued stable coins that follow a regulated standard.

Nicola Tangan: Can they coexist?

Brian Armstrong: Yeah, I don't see any reason why they couldn't coexist. And I think there's going to be certain segments of the market that will only trust a central bank digital currency. There's going to be other ones that lean into the private ones and they just the private ones will just move faster, I think, and innovate faster.

Nicola Tangan: So, if stable coins scale massively, what are the implications for government bond market?

Brian Armstrong: Well, stable coins are going to create a lot of demand for government bonds, T bills. And today, I think stable coins, the total stable coin market cap is about 300 billion or so. I think last time I looked maybe stable coins writ large are about the 16th largest holder of US government debt. And so if you're the Treasury Secretary that's probably a good thing. You want more demand for US treasuries. Um you know and then what's interesting is that because those short-term treasuries um like under the US regulation you can only hold short-term US treasuries that underlying stable coins um that are 90 93 days or less. So it's very short-term treasuries. that's low risk, designed to be very low risk. And what we're seeing is that a lot of um stable coins now, they can pass along some of the rewards from holding those short-term US treasuries to the actual customer, which is a nice uh benefit for them. So, I think overall um you know, I'd say stable coin, US backed stable coins are very good for the dollar. Like if there's a euro backed one or any country, most countries are racing to have one of these now. They're they all see it as a good way to get their currency to create more demand for their treasuries but also you know export their currency around the world so it has more use cases.

Nicola Tangan: Do you think Europe will get one?

Brian Armstrong: Yeah. So actually Europe has one. It's um it's there's one called EURC uh that we work with and support and it you know 97% of all the stable coins are backed by the dollar right now. So I think that the race is on where most of these other countries really need to start to create clear regulatory environments and then push the adoption of it to compete with from a US lens they they like the fact that it's dollarbacked mostly. Um they they view it as a key tool to preserve the reserve currency of the dollar. But you know I I I wear many hats because we operate in many countries. So when I talk to different folks I encourage the folks in Europe for instance to continue to promulgate good rules around that and accelerate adoption.

Nicola Tangan: But do you think it will happen? like it's it's very small for the moment.

Brian Armstrong: Yeah. Um I think the key the key thing that would drive adoption of one versus another right now is the payment of rewards. Like basically can the customer earn um the rewards from the holding those short-term government debt underneath.

Nicola Tangan: So basically paying interest.

Brian Armstrong: Yeah. We don't use the word interest because that legally is associated with having bank deposits that do fractional reserve. And in this case there's no fractional reserve happening. It's 100% reserved by short-term debt. But that's a legal debate that's happening right now. So we we call them

Nicola Tangan: but I'm sorry. But you but you don't want to call it interest because you don't want to upset the banks.

Brian Armstrong: Exactly. Yes. We want to work with the banks to integrate this technology and Coinbase is actually powering integrations for five of the GI banks right now. So we we want to help. That's the smartest banks are all leaning into this as an opportunity. We hope that that continues.

Nicola Tangan: But you say you work with the banks. Are you are they your partners or are they your prey?

Brian Armstrong: They're our partners. Yeah. I mean, first of all, we we work with them today um for on and off ramps and we we do lots of our own corporate work with them. Um but I think all of the smartest bank CEOs right now, the large banks, etc. are leaning into stable coins and and crypto generally. Like they're they're integrating stable coin rails because they're faster, cheaper, they can save them money with Swift fees and move their client funds around faster. They're also using crypto to tokenize their various funds and assets. Um, and then they're providing crypto trading to their clients like in their high net worth clients and things like that who want access to these assets. So there's we have a product called Coinbase Prime and um, Coinbase developer platform that helps any institution integrate crypto services whether that's wallets, trading, payments, etc. And we are the leader leading provider of that for institutions.

Nicola Tangan: But um, banks say that yield on stable coins could drain deposits and hurt consumers. So how do you argue against that?

Brian Armstrong: Yeah. So I think this tension already exists in the current financial system. Um you know there there's the the risk-free rate right by short-term government debt and people can put money in uh money market funds for instance or u by short-term government debt. Um or if they want to attract a greater return they can just choose to lend out their money. And so there's already a tension between this um you know actually the large banks right now are holding about $3 trillion at the Federal Reserve just to get the short-term rate from the government themselves. They're not actually lending out the money. So I think that if you look at the order of magnitude here, there's about like $7 trillion in money market funds. There's $3 trillion the the banks are holding at the Fed getting these short-term rates. And stable coins are only about $300 billion, right? So it's 300 $300 billion is a tiny drop in the bucket for stable coins. money markets and the money they're holding at the Fed is is it dwarfs it, right? So, it's hard it's it defies credul in my mind to say that stable coins are a threat to these deposits. Um, I think that the reality is that there's a large percentage of deposits that are interest rate insensitive and people are going to continue to hold them at banks. Um, if people want to hold stable coins at a crypto wallet or a crypto company and they can earn more rewards on that, that's a nice marketing tool. the banks over time may have to compete on that and and choose to share more of the economics, but I actually don't think it'll be a huge impact to them in the in the medium-term or short term.

Nicola Tangan: So, we own stakes in big asset managers. What's going to happen to their business model when funds are tokenized?

Brian Armstrong: I think it's going to be great for them. I think it's going to create more demand for their funds and products. I think it's going to democratize access. it's going to reduce a lot of the back office uh fees and costs to operate that type of business. It's it's actually, you know, broadly this term tokenization, right? It's it's basically this idea that you have an underlying asset and then you make a digital token that one to one represents it. So the first case we've seen this take off is with stable coins. That's a dollar held um you know in a T bill or whatever and then a digital dollar and that's that's tokenization of the dollar. So that that took off and is doing great. It's a huge growth area. We're now seeing the tokenization of all these other asset classes and like like you mentioned and this this can happen in real estate and private credit and the funds that you know Black Rockck and Apollo these and these firms put out. So I think it's going to just create more demand for their products essentially.

Nicola Tangan: If you could change uh one thing when it comes to US regulation, what would you change?

Brian Armstrong: Well, right now the US is on the cusp of passing what's called market structure legislation. So the first bill already became law which is around stable coins. This second bill is clarifying all the non-stable coin assets in crypto and it it's in particular it's answering this key question of what is a commodity and what's a security. In the US we have two different federal regulators for commodities and securities. So this is a big question that in the past it created a bit of a jump ball between the two you know uh the the two agencies we were kind of caught in the middle and so clarifying this question in the US is very important. just interestingly in other markets where like in the UK or Singapore there's only one federal regulator for both commodities and securities so it's a total non-issue there but um yeah so if this becomes clarified in the US I think that it'll be another huge unlock for you know crypto securities like how capital formation works um how the the commodities how how can an asset become sufficiently decentralized to be a commodity and that would make a lot of clarity so uh we're working hard on getting that legislation uh passed hopefully at some point in the US.

Nicola Tangan: Now the US has declared itself the crypto capital of the world. What's that going to mean for US competitiveness you think?

Brian Armstrong: Yeah. Well, President Trump, yeah, he said that he wants the United States to be the crypto capital of the world. So, he's much very much embraced this technology trend and tried to help it be moved back on shore. I think he has a fear or a concern I should say that um too much of it has moved offshore due to the lack of regulatory clarity and you know that shift in tone from the United States government has created a shift in tone in in other countries around the world as well who have started to uh compete for that talent and um that that that industry. It's a complicated question like the geopolitics are interesting. Um I mean there's right now there is several financial hubs in the world right you could New York is is the largest but you could look at London and and Dubai and Singapore and I think all of them are trying to think about how they can not just maintain their share with that but try to grow it and I I find it interesting as a CEO you know in any given moment there's some parts of the world that are leaning into this technology and there's some that are hesitant and so we we basically just try to go invest wherever there's regulatory clarity and and a friendly environment and then you know typically off people you know politicians change and cabinets change and every four years or eight years depending and so if it flips the other way then we go invest somewhere else and so there's been moments where we try to just minimize the fines in a country and then there's moments where we actually try to grow in that country and we're always kind of just evaluating the political landscape

Nicola Tangan: now as as this crypto matures how will sanctions and financial crime and financial crime be handled you think

Brian Armstrong: yeah very much the same way it is today in the sense that there are regulated financial institutions or intermediaries. Uh Coinbase is an example of that. So we follow all of the anti-moneyaundering laws and know your customer laws and we've been a great partner to law enforcement on that. So whenever they're trying to track down some bad actors um we have a great team that can help them do blockchain analytics. There was kind of this misconception early on that Bitcoin or these digital currencies were anonymous and it's now become very clear that that's not the case. Um it's actually a public ledger and so it's trackable what's what's happened. And then you know people are they go through their know your customer process where you have to upload your ID when you open an account like at Coinbase just like you would with a brokerage or a bank and we do transaction monitoring on that. And so if some sort of illicit activity is happening we we report it. if if we get a subpoena from law enforcement, um you know, we work with them on that as the as the law requires. So, I think that bad bad actors have started to realize that it makes it's a it's a it's a really bad idea to try to commit crime using crypto. It's actually more traceable than cash. And so today, cash is still the preferred method that crime is committed in. And um yeah, that's something that we often have to go educate the folks about because there is still a perception that um crypto is somehow you know used more for crime. The reality is that about half of 1% it's a little bit less than half of 1% of all crypto transactions are for illicit purposes. And the US dollar cash is about 4% used for illicit activity. So it's actually far more um it's far more of a safe environment than than cash.

Nicola Tangan: What is uh quantum computing going to do for crypto?

Brian Armstrong: Well, quantum computing is a big trend that's going to affect of course lots of different areas of cryptography and technology. Um and so if for some reason a you know I don't know 100 cubit quantum computer were were just available today it would affect lots of things much beyond crypto. I mean all all uh transactions you know in the financial system for instance but also every login and password every all encryption data. So it's a much bigger topic.

Nicola Tangan: Will it be the end of crypto?

Brian Armstrong: No, it won't be the end of crypto. Uh the reason is that like all systems will need to upgrade to postquantum um cryptographic algorithms. And so just like in banking or you know in um how Google stores data or anything all these will have to be upgraded in that environment. And so what we've done at Coinbase is we've made a big effort to get ahead of this. Uh the important thing is you don't want a a rush at the end. You want to get ahead of these kinds of issues. So, we put together this advisory council of cryp cryptography experts um to make sure that we're making progress towards the upgrade of the Bitcoin network and the Ethereum network. And of course, we don't control those networks. Um they are truly decentralized, but we can try to help where it's helpful and make sure that the industry and the community really comes together with these upgrades. There's actually regular meetings already happening in the uh the Bitcoin uh development community for instance about the the next algorithms that they the Bitcoin network could upgrade to and it will that will be uh you know quantum resistant and it will require the the network to upgrade essentially.

Nicola Tangan: Do you think part of the reason why crypto has been weak is because people are uh worried about what will happen with quantum computing going forward?

Brian Armstrong: you know, well, the yeah, the Bitcoin price did come down um about three months ago and a lot of people were trying to figure out what the root cause of that was. I there was a lot of, you know, theories being promagated like, you know, maybe Kevin Worsh as the Fed chair is going to be more of an inflation hawk and um you know, that a lot of people were buying Bitcoin as like an inflation trade or something like that, an inflation hedge. Um, another theory was this one around quantum. Um, you know, I just personally I'm I think that the quantum thing requires a lot of diligent effort, but it's not existential to Bitcoin. I think that with with good work that we can make sure that lands in a good place. Um, I think that inflation is still a major issue around the world. So, to be honest, I you know, there's obviously various macro events like the wars and all kinds of things that have caused the market to pull back, but um, yeah, I was surprised at how much Bitcoin came down and I think the fundamentals underneath have not changed very much in my point of view. So sometimes the markets um people are trading based on what they think other people are going to do, not what they think the reality is. So yeah, that's more your domain than mine. But yeah, I should ask you actually what what do you do? You have a theory about why Bitcoin came down.

Nicola Tangan: I'm not the specialist here. You are the specialist.

Nicola Tangan: You uh moved very fast on AI adoption in in your company. Um tell me how how did you do it? How quickly did you get people to you know take that opportunity?

Brian Armstrong: Yeah. Well, as these AI models got better over the last few years, we certainly made a we we recognized that, you know, we needed to make a big push internally to stay ahead of this. Every company does. So, we were already using AI in a variety of places in the company like to detect fraud. Um, we were using it um in our compliance programs. Um, but we started to really try to move to a AI first mentality throughout the company. So for instance on our software engineering team we now have more than 50% of the code is being written by AI. About 60% of our customer support tickets are being answered with AI. But you can of course still talk you know reach a human if you need to. Um you know and with our compliance automation we've started to see some really impressive potential savings cost savings. The the most interesting thing though we that we've seen now is that AI agents are increasingly transacting using stable coins. That's a there's this kind of emerging area called agentic commerce. And if you believe as I do that eventually there will be more AI agents than human beings. Um you know AI agents can't go open a bank account. Um which still requires you to you know know your customer and have a government issued ID for for a human being. But an AI agent can absolutely have a stablecoin wallet. And so we've built some really great infrastructure and tools for AI agents to spin up um their own stablecoin wallet and then they can begin to transact. So they can go get work done on your behalf. Like if you if you ask your AI agent to book you a trip, they can go pay for tickets and hotels and things. Um if you're asking a software developer AI agent to go build you some website, they can register a domain name or spin up resources on AWS or GitHub. Um they can also AI agents can transact with other AI agents which is a fascinating. So, we're having this kind of, you know, machine toachine type payments. And because a stablecoin payments are so fast, cheap, and global, I think they'll actually be several orders of magnitude more transactions every day, maybe smaller dollar values um as machine-to-achine payments really start to take off. So, that's been an exciting area as well.

Nicola Tangan: How prevalent is that now?

Brian Armstrong: Well, I wouldn't say that it's like a material percentage of global GDP, but um you know, it's early, but growing fast. And so,

Nicola Tangan: how fast?

Brian Armstrong: Well, just as an example, we put out um we put out this protocol called X42, which is uh makes it easy to attach a a stablecoin payment to any web request between agents or in other situations. And it's now done, we just put that out maybe about um five months ago and it's done 100 million transactions now. And it's um it's shown really good growth over the last few months. So I yeah, it's really it's so early like this is all happening in the last six months. Um, it could be I my guess is it would grow 2 to 5x per year or something like that over the coming years. We we don't know. It's it's really starting to get a lot of attention though.

Nicola Tangan: Did I read somewhere that uh you in order to get people to really adopt AI and the company just said, "Hey, either you use it within a week or you're out."

Brian Armstrong: Yeah. I mean, these stories always get um they get better every time you tell them. But um what I did do is I said, "Hey, I want we want every engineer to onboard to this tool, you know, cursor and claude and and these different things." and at least try it, right? Like this was about a year ago now. Now almost all the engineers are using it every day. But um at that time I think there was just like anything people were a little hesitant. It's a new thing. I have the thing that I know how to do every day. I'm you know why are you telling me how to do this? And what I told them was I I want to see everybody try sign up and at least try it out. like you don't you know you don't have to switch your entire workflow every day but if you haven't at least signed up and tried it out I start to question your eagerness to learn the latest tools in your career in your profession and um and so I was watching the numbers of adoption of this inside and it was like okay we got 60% of engineers to try it and 70% and at some point I just got impatient and I said I just sent a note to the engineers I said like everybody just sign up and try this out by the end of the week and if you can't I'm going to host a meeting on Saturday with the CEO for anybody who hasn't tried tried it and I want to hear from you why you haven't tried it and if you don't have if you don't show up for that meeting or you don't have a good reason you know I I didn't say this in the message but you know about I think maybe only one person got fired actually because they they refused to sign up for it and they didn't come to the meeting and they didn't have a good reason like they weren't on vacation or parental leave or something like that um they just refused to do it and I so I was like hey you're not a good fit for the company so I think only one person got fired but it did it did create a very clear tone tone from the top that we need to stay on top of these things to be relevant as a company.

Nicola Tangan: I call that a very clear tone from the top.

Brian Armstrong: Yeah.

Nicola Tangan: In 2020, you declared uh Coinbase apolitical. Uh but by 2025, you were one of the most powerful operators in in Washington. So what happened there?

Brian Armstrong: Yeah. Well, so in 2021, we we put out a blog post saying that we're a mission focused company. And there was an important distinction I made there saying we are going to be focused on our mission which includes some of our policy work around the mission. But on on all other issues in the world, we are not going to bring that into the workplace because we all have different points of view and it can be a distraction. And we as a company came here to focus on one mission, not the other one. So I think it was consistent for us to continue to focus on policy efforts related to our mission of increasing economic freedom in the world and crypto adoption. And so we did realize at a certain point um especially just during the last administration in the United States there was um an SEC chair and a and um one particular senator who was very anti-crypto and they decided to um create a lot of lawsuits and lawfare in our view in my view they tried to unlawfully try to curtail or kill the industry in the United States um even though that was not the will of the voters and the people and that was not the will of Congress at large. And so we did end up engaging in some litigation. Um we started to build more of a policy muscle both with um a grassroots movement of voters in the US that we uh helped fund an organization there. There was a super PAC that we put some money into. And um you know my preference honestly I'm an engineer by by background and as a CEO what I prefer to be doing is working on products and engineering. Um but if you start to see that the limiting factor to the growth of a business is regulatory clarity and there's parts of the government love it, parts of the government hate it. Um how do you start to build that policy muscle was something we got very good at during that time period and you know we the job is not done obviously but I think that we did develop a very strong policy muscle and that's helped us grow the industry in the US and now in these other countries.

Nicola Tangan: What reflections do you have on uh running a company uh in an industry which has become so political?

Brian Armstrong: Well, you know, my preference always would have been to not engage too much in politics, but my observation is that if you're doing anything innovative, it eventually intersects with the government, right? I mean, if you look at um like Uber and Airbnb, they they became it became very hot button political issues. You know, obviously self-driving cars, um space, you know, uh AI is like a huge political issue right now where a lot of the AI companies have actually come to the crypto industry and said, "How did how did you do you know, teach us because uh right now the popularity of AI on both sides of the aisle is very low and so you you know, they need to somehow try to win hearts and minds. And um you know, I initially was kind of reluctant um to go engage more in DC. This was like maybe seven years ago or so. And I felt like I really just wanted to focus on product engineering. But people like Mark Andre actually who you mentioned earlier he he's on our board and he's one of the people I really credit for convincing me that he was like you know this industry is just it's not going to achieve its full potential unless you start to take this seriously as the leading company in the US and I found a way to actually enjoy it in some ways. Um whatever is moving the company forward the most important thing I can be doing in any given moment to move the company forward I can get excited about it. doesn't really matter what it is. Um, as long as it's the most important thing to create progress that I find that motivating and so I've gotten to know lots of people in DC and uh I actually find it quite interesting and enjoyable at this point.

Nicola Tangan: Talking about motivation, how do you um how do you react when the value of your shareholding goes up and down by like 10 billion dollars?

Brian Armstrong: Yeah. Well, you know, I we grew up in a world of crypto volatility. So, in some ways the public markets, we were well positioned for that. But I don't I don't love it as a um just in terms of creating predictability in the business, right? Um it it's uh yeah, for for better or worse, you know, we we went out as a public company in 2021 and I think that that had a lot of benefits like it allowed us to be the most trusted brand and to land a lot of these institutional clients. It made it a lot easier to raise convertible debt and do do lots. So we we kind of became like the grown-up in the room, which was great. Um, I definitely, you know, don't love sometimes the volatility of the public markets and sentiment can just swing very wildly where as a private company you can kind of hold on to your last mark for longer than you should at some points sometimes. Um, so anyway, I'm glad that we went out first and we still are building our um our, you know, I'd say like the base of long-term holders, right? actually getting added to the S&P 500 last year was a major forward step there where I think we've we've actually brought on a lot of um institutional holders through that uh process and that's been great.

Nicola Tangan: You mentioned uh long-term uh on the side you are running a longevity biotech company. Uh is that uh in order to be properly longterm that you do that?

Brian Armstrong: Well, I do I do think very long term. The person running it every day is Jacob Kimmel, who is a brilliant scientist and operator of that business. But I, you know, I I co-founded it. I put some of my own money in as an investor. I'm on the board. You know, I helped them early on get it off the ground. But yeah, that just to give you maybe a sense of why I did that because it may be atypical. um you know when when Coinbase went public and I got some liquidity from that um you know I decided all right I want to be continue doing doing this for a long time as a public company CEO but I also want to think about how to use this capital to accelerate progress in the world and you know actually a little bit a little bit like Elon right with PayPal he got some liquidity from that um in the world of software it's sometimes a little easier to create your first business and it's a little more forgiving than the world of atoms where you're moving things around um in the physical world. And so what I did was I I started to think about what are the big technology trends that would change the future in the in the coming decades. And you know, you I'm sure you think about lots of them, right? There's there's AI and there's, you know, cheaper energy, fusion energy, there's space, there's brain machine interfaces. Um you can read go read Ray Ray Kerszsw, right? Like he talks about how um he he predicted a long time ago that that you we'd have artificial general intelligence around 2029. He seems to be on track with that prediction. He's also said that he thinks we'll hit longevity escape velocity in 2030 to 2035 as um AI and single cell multiom multi multiomics things like that kind of come down in cost and anyway long way of saying um I felt like there were good people working on a lot of the other big technology trends but I didn't see I didn't see like a great company or team in the longevity space in fact there was a lot of kind of snake oil and um kind of less serious companies and so I hosted a series of dinners was lucky enough to find the other co-founders um Blake Buyers, Jacob Kimmel um and Greg Johnson who helped create the company in the early days too and yeah put some money in and I think it's it's doing something very exciting uh which is called epigenetic reprogramming which essentially it's reprogramming your cells to restore function they had when they were younger and new limit is uh yeah it's gone faster than I thought I I thought it would have been you know five six seven years of kind of basic research but within three years they were able to demonstrate successful reprogramming of human cells to restore function they had when they were younger. And so they're on track now to get their first drug into clinical trials next year.

Nicola Tangan: How how old are you now?

Brian Armstrong: 43.

Nicola Tangan: How uh how long do you think you're going to live with this new technology?

Brian Armstrong: Oh, with new limit and epigenetic reprogramming and just broadly. Yeah. Um well, none of this is guaranteed obviously. I think it requires a lot of hard work um and good things. Lot it's going to take hundreds of companies doing things in this space. Um but I think that within our lifetime um we'll we'll reach I think there's a good chance I don't know if it's like guaranteed but it's 50% chance that we could reach what's called longevity escape velocity where for every year that you live um medicine and science advances enough where you could add another year of life and and then the things that would take you out at that point would be like you know accidents and um getting hit by a bus and things like that is it's not you don't become immortal but you know I do think there's a possibility at least that within our lifetime Now that that's probably an aggressive uh point of view like Ray Ray Kerszswwell would put that view out. Um I think most people if you talk to in big pharma they would say oh it's it's our generation won't be the one but maybe the next you know our children will be the ones that could live forever indefinitely. Um

Nicola Tangan: if you are lucky and you stay out of the bus lane yeah

Nicola Tangan: you think you potentially could live for a couple hundred years.

Brian Armstrong: I think it's possible. Yeah it's certainly not guaranteed but with hard work I guess I I'll give you like a little bit more of the trends that I see happening. Right. So of course AI AI is clearly a trend that's happening that's going to have downstream effects like an example of it's going to be people are creating now these virtual models of the cell where how can you simulate not just um like protein folding like a single protein but how could you simulate the entire model of the human cell that would allow you to start to run something like clinical trials or protein clinical trials in software in silicico right so you could dramatically accelerate the number of experiments you can run in silicico and then take the most promising ones to to actual clinical trials. Um some there's something called like single cell multi multiomics which is like getting a readout of the entire state of a cell that is following a cost curve similar to Moore's law. So the cost to read out the entire state of a cell is falling in cutting in half every 18 months or or or faster actually. So, it's allowing companies like New Limit to do these massive poolled screens where we can test um tens of thousands of different hypotheses now where before you had to kind of manually do like, you know, one at a time. Um and then yeah, there there's a couple other trends like that that are happening where I think, you know, we we could potentially have really breakthrough therapies in the 2030 to 2035 time frame.

Nicola Tangan: Incredible. Wow.

Brian Armstrong: I mean, that's what gets me excited is just how do we how do we accelerate progress with science and technology? So I mean there's by the way there's a whole other um tech tree happening here with brain machine interfaces too right like that's the other way that people may merge with AI and actually up you know upload your brain so so to speak um which is a whole other sci-fi topic but uh anyway

Nicola Tangan: are you involved with that as well?

Brian Armstrong: No nothing directly I I mean I've invested in a few of the brain machine interface companies because I think it's interesting but I haven't I'm not building anything there.

Nicola Tangan: Brian lastly what is your advice to people who want to do young people who want to do amazing things?

Brian Armstrong: Well, you know, just like any skill set, it takes a lot of iteration to get better at it. Um, you know, I started a company in in college um that was lots of hard work and it was not really that successful and I tried a couple more ideas. I went to go join a startup. If you're excited about whether it could be anything as an investor, this is true. If you want to be a great musician, this is true. if you want to be an actor, whatever it is, you know, you kind of have to just show up for a decade and keep trying a lot of things and lots it's not going to work that much early on. So, you know, action produces information. Like, if you have an idea, go try it. Don't just sit around thinking about maybe what if this and that. Um, there's a certain amount of agency and initiative that's required for people to step into the unknown. Be willing to look foolish, to be a beginner, to fall flat on your face. And most of the things I've tried in my life, I didn't they didn't work the first time or the second time or third time. But I'm stubborn and determined enough and okay looking stupid that I just kind of kept going. And some of the things I try now have worked and not all of them will. So I'm going to always try to stay hungry and foolish as Steve Jobs said, I guess.

Nicola Tangan: Well, you for sure have shown up, tried a lot of things and for sure succeeded. So it's been great talking to you. Incredible story. Big thanks.

Brian Armstrong: Yeah, thank you. I appreciate it.