Summarize this content to 2000 words in 6 paragraphs in Arabic FT Alphaville caught up with Anthony Scaramucci — founder of SkyBridge Capital and Donald Trump’s White House communications director for 10 days in 2017 — on the sidelines of the Digital Assets Forum in London, when crypto prices were sharply lower. The transcript has been edited for clarity.FTAV: How’s SkyBridge positioned for Trump 2.0?AS: We’re long, so if the crypto market’s correct, we’ll get hurt. But as I’ve written in my investment letters, we have a long-term, three- to five-year outlook. And a lot of things are still so early in the space. If you get full-on institutional adoption, where a bank is allowed to custody crypto, hold it on its own balance sheet, use its capital to be a principal investor in crypto, maybe even just bitcoin, I think that would be a very big, powerful move. Think about it this way, you only have 21mn coins. So do the math. According to JPMorgan, there are approximately 75mn millionaires in the world. So, you only get 21mn coins. Not every millionaire can own a full coin. It’s not possible. There’s a scarcity value to it. There’s an inelasticity to it. So the combination of more mature markets, more mature definition on regulation and so forth, is very good. You’ve said the US will have drafted pro-crypto regulation by November. What’s your thinking?Let me give you the rationale for that. I’m running for re-election to Congress, I’m subjected to a two-year term, and if I don’t want to be opposed by the crypto industry, I want to be out on my front foot proposing positive crypto legislation. And so I believe the congressmen and women running for re-election, their campaigns have to start no later than March of 2026. We’re talking one year from today. What typically happens is you get a burst of legislative activity before the congressional Christmas recess. You’ll probably get it in November of this year, before that recess. But if you don’t, I don’t think you’ll get it much later than the timeline I’m suggesting.[Scaramucci spots a journalist and pauses to complain about a former colleague of theirs. “She writes such nasty shit about me. I figured I must have dated her in high school,” he says. “It’s obvious! When Trump calls me a major loser, you know that’s a 20-year-old girlfriend still loving on you, right?”]Can we talk more about Trump? November is a very long time away . . . That’s true. But the incentives are there. Just play the congressman or woman in your mind. They’re like, whoa! I’m not going to be anti-crypto. I’m going to be on the campaign explaining to my potential voters that I was voting for crypto. . . . but with this government, very little is certain.Let me ask you rhetorically . . . Why on God’s earth can’t we get a normal politician that has normal regulation, so we can all go back to our day jobs? We don’t have that. We have an insane lunatic. And the result of which, you have an industry that was parched, bone dry, looking for help on regulation and couldn’t get it from the Democrats. So they dumped a ton of money into the Republicans and they feel like they’re going to be getting it.The US’s biggest crypto onboarding event, probably ever, was the Trump coin launch. You don’t see that as a risk? [Trump’s eponymous memecoin is 76 per cent below the all-time high reached on January 19, the day after its launch.] I think at the margin it hurts. Because there’ll be older legislators, older regulators . . . maybe the people that really hate crypto, think it’s a scam . . . A lot of the electorate also thinks that.But . . . Let me put it to you this way. Web 1, when the internet was getting started, it was clunky. It wasn’t working well. Then the porn distributors figured out that they could distribute their porn over the internet, and they enticed the telephone companies to widen the bandwidth, so that you could have more definition on the filmmaking. That enabled the advent of things.You sometimes get nefarious activity in a new technology that drives the technology to the point of full acceptance. We’re both old enough to know that there’ll always be vices on this planet. There’ll be tobacco, there’ll be prostitution, and there’ll be gambling. They’re the oldest things out there, and they’ll maintain some level of demand long after you and I are gone from the earth. With Web 1 the breakthrough product was porn, because it always is. What’s crypto’s porn?Gambling. Memecoins. Doge, all that stuff. The promise of crypto, like the promise of the internet was in the commerce. We’re doing trillions of dollars of activity on the net. We can very conveniently have Amazon boxes delivered to our house. I can have somebody pick out my groceries and bring them over to the house. Trillions of dollars of transactions, B2B, B2C, C2C transactions. And we have the bandwidth to do that. The precursor of that was porn. So memecoins are blockchain porn? Look, the Trump coin is bad for the industry. It’ll scare people, it’ll make people think that the industry is a scam. The flip side of it is the Trump coin proved how valuable Solana’s network is. You tell me how many billions of dollars that went on the Solana network trading that coin in the first three days.If we’re really gonna tokenise things, one of the ways to test the rail system is through the meme coins. Whether it’s Doge or Trump, you pick the coin, and I think it’s helpful. It tests the stuff. I don’t like it, but that’s one of the positives of it.[SkyBridge is an investor in the Solana blockchain platform.]To what end? For what serious purpose are we stress-testing the network? The tokenisation of all assets. We know that with the blockchain, we can trade 24/7 and we can transact with each other instantaneously. We’re not doing that in the stock and bond market, but we’re capable. We now have the technology to do that. We can create a smart-contract based token like Solana or Ethereum, put the coin or the stock on top of it. We can do it with instant settlement. We can do it with a very secure transaction. If I wanted to buy a stock in 1990 it went through seven different companies, through a transfer agent, through a trust corporation . . . Over the blockchain it can just go from my wallet to your wallet. Does that mean you’re a seller of the intermediaries? The JPMorgans and Morgan Stanleys?No. Let me give you a great example. Telecoms. When I came here [to London] the first time in January of 1985, when I was 21, I was able to call my parents by going to the American Express travel services store off Piccadilly. I could go in there, buy travellers’ cheques or a phone card. Then I could use that phone card to dial long distance, get the operator, and connect into my mom. That card, for $15, got me five minutes of airtime. Today, I can log into any café in London with my phone, tap their internet, and make that phone call costless. But the phone company is still in existence because I have to have this handheld computer, also known as a smartphone, attached to that network. The long distance carrier fees went to zero, but they picked it up on other things. And so I think that happens with the banks. I think the banks go into [crypto] trading, tokenisation. They go into payment and rail systems that are more affordable, just like we do with long distance, but they find other ways to make money. They may put on custodial fees, You put all your bitcoin or Ethereum here, and we’ll protect it and give you layers of insurance, and you pay us a fee to do it.I need to . . . [Scaramucci checks his Apple Watch, which has the Mickey Mouse face.] Interesting choice of watch face . . . Yeah. That’s the inner child in me.Today’s panel was very positive on the prospect of stablecoin regulation helping institutions get comfortable with crypto. You also talked on today’s panel about Skybridge’s investment in FTX, and how you now have 50 internal and external people doing deal due diligence. Has your firm done the work on stablecoin issuers such as Tether?Tether is a little bit . . . I would draw the analogy to Binance. Tether was an early-stage company in the space. And sometimes you can get the cart ahead of the horse and vice versa. But I think they’re now a mature company that’s operating under best practices today.What will happen to [Tether]? I don’t know the answer. But you know, Binance got penalised. Fines were paid. CZ went to jail for a short period of time. And now, that company has come out the other side. Imagine being in crypto, where you had the largest cryptocurrency exchange, and you were concerned about the long-range viability of the company because of what was going on in the regulatory space. They fixed that, and they abated that. I predict that will happen. It’ll happen differently, of course. But it’ll happen somewhat similarly to Tether. [In September 2022, Scaramucci and FTX founder Sam Bankman-Fried announced that the crypto exchange’s venture capital arm would take a 30 per cent stake in SkyBridge. FTX filed for bankruptcy in November 2022. According to a lawsuit filed by FTX last November, Bankman-Fried sought out Scaramucci as part of “a campaign of influence-buying”, but that its $67mn investment into SkyBridge ventures “offered little to no benefit”.Speaking earlier in the day on a “Wall Street Meets Digital Assets” panel, Scaramucci said his firm was caught out on FTX because Bankman-Fried “had closed the loop down to three or four people”. He continued:The 25 venture capitalists — SkyBridge, all of us — who made a mistake with Sam, we didn’t really understand where the nerve centre was. He did a very good job of manufacturing a datacentre that looked great to all of us that was a fraudulent datacentre. So there are lessons there. But I think the big issue is going to be how much capital can a major bank put into bitcoin.] Can we loop the conversation back to Trump? You were inside the camp . . . It’s difficult. He’s a difficult guy. He’s unwell. It’s obvious to anybody looking at it, prima facie . . . If I broke my leg playing British football and the bone is sticking out, you don’t have to be an orthopaedic surgeon! The bone is sticking out! I probably broke my leg, right? When you see somebody act like a complete lunatic, you don’t have to be a psychiatrist to know that they’re not well. He’s just not well.The problem is he has a way about him that’s amassed a lot of political power. There’s a group of weaklings, frankly, in the United States that are acolytes of his, that won’t break him. Mitch McConnell last night said that tariffs are ridiculous, but he’s saying that now as an 82-year-old about to retire. And at the centre of all that is Elon Musk . . . Musk is a very powerful guy, and some of the things he’s doing . . . I think it’s going to get challenged by the courts. I think it’s very important.You guys over here fight over Taylor Swift tickets, you know. Keir Starmer got them and people are mad at him. Trump took $500mn out of that memecoin before he was inaugurated president. It’s obscene. And now you’ve got Elon Musk as the CEO of several different companies and he’s working inside the American government at the same time. I just don’t see how that’s sustainable. One or the other will have to go.Do you believe the rule of law will rein them in?Good question. We’re in the 13th or 14th day of Donald Trump. I don’t think what he’s doing is sustainable. Someone will say, hey, this is enough, I can’t take it.Who’s going to say that? It’s gonna be a Republican . . . I don’t know . . . maybe [John] Thune, [majority leader of the Senate]. Somebody, somebody will say that. It can’t stay like this. Further reading:— The life and tastes of Anthony Scaramucci (FT)
