Brian Armstrong: When Washington Tried to Kill Coinbase

How much of your job is building political power as an advocate for the crypto industry?

Yeah, I mean, I don't have to go, but I think it's worth it for the business. I don't mind going. In some ways, I like doing it. There are some pretty interesting people there.

I go about once a quarter, maybe once or twice a quarter recently, because we're right at the crux of this key moment for market structure legislation. But I'd say that, over the last few years, it's been about once a quarter.

What's the key moment for the market structure?

The crypto industry has been working for a long time on getting this through the Senate. A whole bunch of people have been trying to get this piece of legislation passed in the House. It was called the CLARITY Act. In the Senate, they're drafting their own version of it, but it's essentially clarifying the question of which crypto assets are commodities versus securities.

Someone might say, "Well, why does it matter?" It matters because, in the United States, we have 2 different federal regulators: the CFTC and the SEC. The CFTC regulates commodities, and the SEC regulates securities.

It turns out that, in the past, this ambiguity about where crypto assets sit between the 2 federal regulators—that lack of clarity—was really weaponized by Gary Gensler, the former SEC chair, and Elizabeth Warren, along with some people like that who tried, in my view, to unlawfully kill the industry in the United States.

In other countries where we operate, like the UK or Singapore, they only have 1 federal regulator for financial services, so they don't care whether these are commodities or securities. It's a totally parochial issue in the United States. In the past, it was kind of like a turf war between 2 federal agencies.

We decided that we needed to get legislation passed by Congress to clarify, once and for all, which assets go in which bucket, so that a future Gary Gensler couldn't come in and try to kill the industry.

So, what was the lawfare they were trying to do?

This was around the 2020–2021 timeframe. At Coinbase, we decided we wanted to become a public company. We had been operating for about 9 years at that point, and we went through the normal process with the SEC.

You have to describe your entire company: how it works, how you decide which assets to list, and which ones not to list. At that time, we wanted there to be a path for crypto securities to be traded.

A simple way to think of it is that a security is a way to raise money for a company that you want to start. A commodity is something that's decentralized, kind of like oil, gold, or copper. Bitcoin is decentralized. Nobody controls it, and everyone pretty much agrees that Bitcoin is a commodity.

But there were people issuing tokens to raise money for different projects they were working on that were in various stages of decentralization. So, were they commodities or securities?

Then Gary Gensler, the SEC chair at that time, and Elizabeth Warren essentially decided, in my understanding, that they wanted to use this to curtail the crypto industry. And if you want to know why—

But why?

Elizabeth Warren is, in my view, a socialist. She believes the government should be running all financial services. She had essentially found a way to bypass Congress and have a lot of influence over financial institutions, particularly big banks.

How would she get that influence?

She would appoint regulators who could essentially go in and pressure the banks to do things that Congress had not necessarily authorized. Under the Constitution, only Congress is allowed to make laws, but regulators are given some discretion about how they implement those laws.

You can imagine that, let's say you're a bank and your bank regulator comes in. They can choose to lose your paperwork and not approve something for 90 days, 2 years, or 5 years. Or you can have a good relationship with them, and they can approve things.

Let's say they come in and start asking you, "Hey, are you guys serving crypto companies?" You say, "Well, yes." And they say, "That's not illegal per se, but we're going to have a lot of questions about that in the next exam we do of your bank. We have deep concerns about the risk that this might introduce."

Suddenly, everyone inside the bank is getting the message loud and clear: "Maybe they don't like us doing this." Is it illegal? No. But if a bank's regulators say, "Jump," you sometimes want to ask, "How high?" Right?

This was the kind of extrajudicial pressure that Elizabeth Warren was able to create on banks. She did it, by the way, in a bunch of other industries, too. She got them to stop giving loans to the oil and gas and firearms industries. It was her own political agenda, basically.

She got her hooks into these banks and had a lot of influence over them. Suddenly, crypto came along, which was a new system operating outside of that, and she didn't like it too much.

My understanding—and this is what other people in Congress told me—is that she asked Gary Gensler to go hard on crypto and try to really curtail it in the United States. That's what he did. He created a bunch of lawfare, essentially.

We'd go in to meet with him. We met with the SEC maybe 30 times after becoming a public company. They had allowed us to become a public company, and we'd say, "Hey, we're here. We'll tell you anything you'd like to know. Just tell us what the rules are. We're trying to build this industry in America. You tell us the rules, and we follow the rules. That's how it's supposed to work."

They would say, "We're not going to give you any advice. Go talk to your lawyer." Then, the next day, an enforcement action would arrive. We'd say, "Can you show us in the law what you think we've done that's wrong?" They'd say, "No, we're not going to do that. You need to comply and basically delist all these assets, or we're going to sue you."

At a certain point, we said, "Okay, let's go to the courts and find out."

Who initiated the legal action, them or you?

It was actually both. They created an enforcement action and initiated a lawsuit against us. We sued them proactively because they had violated another part of the law called the Administrative Procedure Act. They're required by law to engage with the industry to promulgate rules, and they had failed to do that.

Wait, how many companies sue their regulator?

Very few. This gets into one of the big themes of me as a CEO. I want to always try to do the right thing, and I have a very long-term perspective. I'm trying to create an important outcome here in the world, which is increasing economic freedom in the world.

In the short term, I knew this was going to hurt our company. A lot of public-market investors just think, "This company is suing its regulator? I'll just wait and see. I'm not going to buy that stock."

A lot of people I talked to at the time said, "Do not sue the SEC. This is a bad idea." But I did. I talked to a couple of other financial-services CEOs who had sued the SEC and won, so I knew it was possible.

It's a little bit like when SpaceX was trying to get that contract with the government.

NASA.

Yeah. They didn't think it was fair how it was awarded, so they sued, and they won. Palantir had to do something similar.

You don't want to do these things haphazardly, but there are moments where you have to stand up and sue the regulator or the government to actually get the right outcome.

When you're deliberating on whether to do this or not, what's the timeframe? Is this a couple of days or a few weeks? How fast do you have to make this decision?

I would say that was probably over a period of 3 or 4 months. We could tell the temperature was rising. They were saying, "You're about to get sued." And we were saying, "What have we done that's wrong? You haven't published any rules that we can actually adhere to."

We knew the temperature was rising. Then we sued them, and they sued us, and we made the call.

The reason I ask is because there's a great story in one of the biographies of Elon Musk, when you just mentioned this.

Yeah.

In that case, it's even crazier because you're almost suing your customer. Elon wanted money from NASA.

Yeah.

There was all kinds of corruption, where they gave this other guy's company $250 million or whatever the amount was, essentially to save the company. The guy used to be either a former astronaut or worked for NASA, and they said, "His company will go out of business if we don't give him the money."

Elon said, "This is insane. That can't be the way we're making decisions."

They tell the story of him sitting there and thinking, "Are we going to do this?" He closes his eyes and thinks for a little bit. Then he says, "We have to sue them," and they wind up winning.

Founder mode, I guess.

You just said "mission-driven." This is what's very fascinating about you. It's, "I have a mission that I'm on." If you're looking at your decisions through that lens, it kind of simplifies what you're doing.

Yeah. I have a long-term perspective on it, too. If it's going to be short-term pain for a few years while we're going through this, but it allows the industry to actually be built in the United States and helps create more economic freedom, which is the mission of the company, then I'm fine with that.

I feel like, personally, I'm well off.

I'm in this at this point; I don't have to work a day of my life. I'm doing this because I actually want to achieve the outcome at this point. It wouldn't have helped me achieve the outcome if we'd let this regulator unlawfully kill the whole industry in the United States. That would've just been a setback from my point of view.

This happened after Republic?

Yeah.

So you accumulated resources. Your company has a lot more resources.

Yeah.

If this would've occurred before, would you have had the money to fight it?

Probably not. In fact, a lot of startups did die as a result of that lawsuit. The SEC didn't just sue us; it sued a whole bunch of crypto companies, and a lot of them folded. In many ways, it actually did a lot for the economic development of places like the UAE and the Bahamas because a lot of the industry moved offshore, but it was incredibly damaging to America.

I think the total amount we spent on legal and all that was maybe in the $50 million to $100 million range as a result of that lawsuit.

On that one thing?

Yeah. But the damage to the stock was probably, I don't know, $10 billion to $20 billion, maybe more. It was a massive downward pressure on the stock for a period of a couple of years.

Oh, and I should mention: We won that case. We didn't pay a single dollar in fines. We didn't have to change a single thing about the company. The judge—or, actually, the SEC—withdrew it under this new administration, and several judges actually published opinions saying that the SEC behaved in an arbitrary and capricious manner. So I have a nice little thing in my office commemorating winning our case suing the SEC.

That's incredible.

Where did you get this long-term perspective from?

I think it was from trying a bunch of short-term things and then realizing that everything's difficult. I started some companies in college, and I realized that everything's difficult, right? Even if you're running a sandwich shop or something, it's difficult. You have to find people who—employees don't show up on time—and deal with the food, the vendors, and margin compression because there are a million other sandwich shops.

If you're going to do something, you might as well—it's going to take you a decade or 2 or 3 to really start to have an impact—you might as well pick something that you care about. That's the really big thing.

It always bothers me a little bit when I talk to entrepreneurs and they tell me the thing that they're working on. I'm like, “Okay, what do you really want to do?” They say, “Well, my big thing is I really want to do this.” In their mind, it's a little too ambitious, a little too difficult; they need more capital. Part of me is thinking, “Man, you should just go for that now,” because you could spend the next 2 decades of your life working on this thing you're just talking about now, and you might as well work on the thing that'll actually have a major impact if it works.

So, are you optimizing for impact?

I think so. Yeah. Early on in my life, I was kind of shy and introverted as a kid, and I was a little on the autism spectrum and stuff, so I think I was just trying—

You keep saying that.

Yeah, I know.

We've talked enough. You're not autistic to me.

Well, I mask it well. There's a whole masking thing.

What? Well, let's talk about this.

Yeah.

How do you mask your autism? Are you just saying you're autistic because it's trendy and cool now?

No. It's actually—the good way to get a venture check is to be on the spectrum. We're not raising money, but—

Introverted for sure, but I'm introverted too.

Yeah.

I hate when people in the comments think I'm autistic because I read all the time. I'm not autistic, man.

I think I'm somewhere on the spectrum.

Okay.

I've taken some online tests and things like that, and there are things where you'll have difficulty reading people's faces and emotions sometimes. I can get overstimulated by loud sounds and lights. There are classic signs like that.

But it's not debilitating at all, and I actually find it to be a strength in a sense that I can just endlessly focus on interesting work, almost for 12 hours a day. I wouldn't say it's effortless; it depends on what kind of work I'm doing. If I have to do 12 hours of people management and hard conversations, that's pretty taxing. But if I'm just writing code, reading things on my computer, or digesting cool content on the internet, I can just do that endlessly.

I wouldn't say you have to be autistic to have that, but there are certain things like that. I just find it endlessly fascinating.

You definitely have the ability to stay with a non-consensus opinion for a long period of time.

Yes. That's the other thing, which I don't know if this is an autism-spectrum thing, but I think some people are a little more concerned with social cohesion or what other people think.

There is a part of me that's just like, if I see something that's wrong and not in line with what I want to accomplish long-term around civilizational progress and these things, I don't care about being disliked. I don't really care that much about being disliked for it, and I know that it'll piss people off.

There are a handful of things like this that I've done at Coinbase, which I think people consistently remark to me, like, “Wow, that was really unique.” To me, it didn't seem that unique, but this mission-first blog post I put out, where we said the company's going to be apolitical during 2021 and all that madness, or suing your regulator—these are things most people probably wouldn't do because they're afraid of being disliked.

It's not that I like being disliked; it actually causes me a fair amount of stress too. But I don't let that stop me from doing what I think is the right thing.

I recently reread that blog post. Can you remember the context of what you were thinking when you were writing it? You look back now, and a lot of people are like, “Of course. You were just focused on the mission of the company. What is the point of having a company if you don't have a mission?”

You read it today, and it's fairly innocuous. But back then, I remember the response. People were going crazy.

Yeah, it's really funny. If you go look at it now, it's like, “What's the big deal?” It's kind of a boring blog post in some ways, right?

But at that time, I feel like there was this mass hysteria or something that had taken over the country. The George Floyd thing had happened, COVID had happened, and people were isolated. They weren't getting together in person as much with folks and feeling a sense of, “Hey, we're all on the same team. We trust each other.”

Increasingly, at these town halls that we would host as a company, people would usually ask questions about our products, our competitors, and regulators. Then we increasingly started getting these questions about social issues happening in the world—in this case, police brutality with George Floyd, but all kinds of things, like the Middle East or gun control.

It became almost like I realized there was this element within the company that really wanted to get in front of the company with a microphone and see if they could make the executive team squirm somehow. We had this culture of an open-mic thing, but I realized that later we actually don't really do that. We just have people pre-submit questions, and if we think they're worth taking, we take hard questions. But if they're way off-topic or someone's pet issue, we don't entertain that. We don't allow 1 person to derail 3,000 other people.

So, it was in that context that the company was going through this, and somebody at a town hall asked the question, “Are we going to support Black Lives Matter at Coinbase?” I basically said, “I don't know if I know enough about it, but I'll look into it. Move on to the next question.”

They held the mic and said, “That's not good enough. I need to know if we at this company are going to stand for this or not.” I said, “I don't know. I haven't looked into it,” and this erupted in Slack. Basically, 300 employees did a walkout in protest.

If you remember, at this time, every company in America was posting pro-BLM statements. I'd never had a walkout of employees at the company before. I didn't even know what that meant.

They all just closed their laptops in a remote environment, I guess.

Yeah. Oh, okay. So wait—is this not in person?

This was all remote during COVID. Yeah.

Okay, so the walkout is, “Close my laptop. Go from my bedroom to my living room now.”

Yeah. And I was like, “Okay, this is weird.”

As a CEO, I felt like I had the confidence of the company or whatever, and now people were saying they were refusing to work at this company based on my comment. I found this very confusing—actually, maybe a little bit of that autism spectrum. I was like, “I’m confused. This company has nothing to do with police brutality or anything. What is going on here?”

We got in a room as an executive team, and I asked them a few questions: “Hey, people are very sensitive in this moment. They need to feel reassured about where their leaders stand.” I was like, “What does BLM even stand for?” We went and looked into that. Later, I found out, by the way, that they support defunding the police and all these other things. It was not a very simple answer, and I didn’t really know what to do.

After about 48 hours or so, we put out a statement and said, “Okay, I guess we support equality for all people,” and all these things. People came back to work, but I felt something was deeply wrong. I felt like I had compromised something about myself, and I didn’t understand what was happening. So I started to go talk to a bunch of employees in the company and read a bunch of these books, like Jonathan Haidt’s book and others.

Which is the Jonathan Haidt book?

The Coddling of the American Mind, I think.

Okay.

Yeah. He basically talks about how, on these college campuses, they’re training activists, and it’s now spilling into the workforce. They feel that their job is not to join a company and advance its mission; they feel like their job is to join a company, speak truth to power, hold it to account for these broader societal issues, and actually reform the company as activists.

I essentially started drafting this blog post, and I said, “We’re not going to do that here. We’re not going to be a company that just tries to jump into whatever the current hot social issue is and make a bunch of feel-good statements without actually doing anything. We already have an important mission, which is increasing economic freedom, and it takes decades of work to try to make an impact on something that big. So let’s stick to the thing that we think is important in the world.”

Outside of work, people can do whatever they want. You can go protest, you can be left or right, or whatever. But inside the workplace, we’re not going to be political. Unless it has to do with our mission—crypto and economic freedom—then we’ll be very political and engage in litigation and things like that.

So I knew it was going to piss some people off. Actually, some people, when they read the draft post before I sent it, said, “Do not post this.” They begged me not to post it.

People inside your company, or did you send it to other founders?

Inside the company.

Okay.

Yeah.

Did you send it to anybody outside Coinbase?

I might’ve sent it to the board or someone like that. I’m not sure if I sent it to anybody from outside. I think I might’ve told a few of my friends what I was up to, but they didn’t read the post.

Okay.

Yeah. So I decided to do it anyway. I knew people were going to be upset, and we put out the post. I had failed to create alignment in the company about where we were going, and I was walking on eggshells whenever people would ask me about this. People were confused about where we stood, and it felt like maybe 50% of the company was against this. But I think in reality it was a very vocal 1% minority, and there were other people who were sympathetic to that cause.

Anyway, we put out the post, and I said, “Anybody who’s not aligned with this new direction, we’ll give you a good severance package. You can fill out this form and accept it by Friday or something.” 5% of the company took the exit package. We were having bets beforehand; we didn’t know. We thought maybe 50% of the company would resign or something.

What would’ve happened at that time if 50% resigned?

We would’ve built it all back. And this is actually a very important point, because I think there’s a big difference between a founder and a president of a company, right? I know that I could build it back because I started it when it was just me on a laptop. I was there when it was 10 people, 100 people, and 1,000 people, and if we needed to go from 2,000 to 1,000, that’s not a big deal to me. I could go back to being on my laptop again if I had to, right?

There’s this great Lee Kuan Yew speech that he gave. He’s the founder of Singapore, and I guess he was dealing with a strike that was happening, I think, from the air traffic controllers or the airline or something like that. But there’s this great speech—if you Google “Lee Kuan Yew, iron in the veins,” you know which one I’m talking about?

He says, in this speech—it kind of gives me chills every time—“I sat across the table from them,” and they were threatening to shut down the airline and everything. And he said, “Get back to work, and I will not allow you to bring this country down. And if you don’t do it, I’m prepared to rebuild it all from scratch again.” He said, “Anyone who rules Singapore has to look at me and know that I have iron in my veins. I will rebuild it all from scratch,” right?

I was watching videos like that, and I was like, “This is what I need to do as a leader.” It was very inspiring. There are moments like that when you have to stand up and say, “We’re going in this direction, and if you’re not on board with it, it’s okay—you can leave. But we’re going this way.” That’s leadership.

There are 2 interesting things that popped out in what you just said. I want to go long-term. Again, you have this long-term orientation. You mentioned it multiple times in the blog post. You’re like, “We’re trying to literally change the world, and that’s going to take multiple decades.”

Mm-hmm.

I want to go to that in a second. But I like how you said, “I was confused.” What is going on here? So your first instinct when you’re confused is to start reading books and talking to people.

What do you do to try to essentially alleviate the confusion? Because you’re like—

Yeah.

“Oh, I don’t know what’s going on. I’m going to read Jonathan Haidt’s book,” for example.

Yeah. All of the above. I read books, and books are amazing. I think sometimes reading is like reading for 8 hours to get to that one part: “Oh, that’s the key insight,” you know?

Actually calling people, I think, is faster if you have access to them, especially. Earlier in my career, I didn’t have access, but now I feel like I can get access to more people, and it’s often just a shortcut. If you know the right person to call who’s been thinking about that or working on that for 10 years, they can explain to you in 30 seconds what you need. “Oh my gosh, that’s the connection. Of course.”

So yeah, that’s exactly what I do, and I just follow my instinct a lot of the time. Your day as CEO can get infinitely scheduled, and you’re just trying to hire the right people, talk to investors, build, go to product reviews, and stuff.

But once in a while, you just need to follow your nose if you’re like, “Something’s bothering me.” You’re always ingesting information, and once in a while you’re just like, “Something feels really off over here.” This team is rudderless, going in no direction. Or, “I don’t trust what’s going on over here with this policy thing.” And you can just go digging. Occasionally you find things, and you can add a lot of value.

When you say “follow your nose,” is this intuition?

Yeah. It’s intuition. It’s pattern matching. A lot of times you’re just absorbing information, like in documents people are writing up, Slack channels, and reports, and a lot of information is just being ingested. Once in a while, you’re like, “That’s the third time I’ve heard something weird about that. I need to go dig into it.”

I was actually surprised. One of my favorite conversations I’ve had so far for the show was with Tobi Lütke. You and I talked about him at lunch, and I always say he’s your favorite founder’s favorite founder—people really admire the way he thinks and the way he’s building his company.

You would think this German engineer is going to be all data-driven, and he just kept talking about visualization and affirmations.

Yeah, exactly.

Affirmations.

Yeah.

All intuition. It was actually surprising. It’s one of the most fascinating things about that conversation.

So explain the difference in how you thought when you were starting the companies before Coinbase. You had this long-term orientation almost from the beginning of Coinbase, but you lacked that in the other businesses that you were starting before that.

It was really just by trying enough projects that either didn’t work at all or were base hits that I realized everything was difficult.

My mentality in college and coming out of college was that I knew I wanted to be an entrepreneur. I was trying different ideas. My view was, “Okay, if I can get something to pay me, I don’t know, $100,000 a year passively, that would be incredible, because I could somehow free up all my time, and then I would…” I don’t know what.

I’d be able to be passive-income wealthy, and I could then go build something else—or I don’t know. I didn’t really have a plan after that.

What year was this?

I graduated in 2005.

Were you reading Tim Ferriss?

Yeah. Tim Ferriss had a big thing on this. There was The 4-Hour Workweek, that whole idea. I was thinking about it even before that, but The 4-Hour Workweek was definitely that.

The first company I really started in college was this tutoring company, because I had been tutoring high school kids while I was in college to make extra money. Working at the library, you got paid—I forget, it was around $7 or $8 an hour—but if you were tutoring high school kids, you could make $60 an hour. I was like, “This is crazy.”

I was tutoring kids for a while, and then I realized I could match my other college students with other high school kids. So I built this simple web app, which was a tutor-finding, tutor-matching service called University Tutor. I was building this in college with another friend of mine, a roommate.

I didn’t think about it from first principles. I wasn’t particularly passionate about tutoring or education. I was just trying to make some passive income and scale it. It would’ve never occurred to me at that moment to zoom out and say, “You know what? We need to become an interplanetary species. I should make rockets.” I was like, “What are you talking about? I’m just trying to go from $60 an hour to having 10 of my friends get jobs too.”

So I went through that process. The tutoring company is its own little story. Then I tried a couple of other ideas like that after college, too. I got these rental houses in Houston, and I was refurbishing them and trying to build a little real estate investment business. I was doing a bunch of stuff.

At some point, I remember I read this book by Seth Godin called The Dip. I don’t know if you’ve ever seen that book.

Yeah, I read it a long time ago.

Yeah. It’s actually a pretty simple book. I don’t know if it would do anything for me today, but at the time when I read it, it was a pretty powerful idea. He was basically saying there’s a big dip between being a beginner and being at the top of your field, where you’re in the top 1%. Most people quit in the middle because it’s not fun after you’re a beginner. There are the 10,000 hours and all those kinds of things.

I remember thinking, “Do I really want to be doing real estate in 10 or 20 years?” I was like, “No.” Do I care enough about education? I was like, “I don’t think so.”

I literally had a piece of paper, and I was writing down the things I was passionate enough about that I would do them for the next 20 years, even if I saw little or no success. The only thing I could think of was tech entrepreneurship. That was the only thing I could really think of.

That was a very clarifying decision. I decided, “All right, I need to move to Silicon Valley, because that’s where tech entrepreneurship happens. I need to shut down all the other stuff I’m doing, because those are just little short-term games.”

I sold off all these little rental properties, and within a few years of that decision and moving to Silicon Valley, Coinbase had been founded. I think within 7 years of that decision, Coinbase had a billion-dollar valuation.

It was a huge direction change in my life. I was just like, “I know the big thing is long-term, and I’m going to go all in on it,” and all the decisions led to that.

At the time you started Coinbase, did you think, “If it succeeds, this is something I’m going to dedicate a few decades of my life to doing,” even at that point?

I remember I did think that, yeah. I had tried a couple of these other ideas that were difficult, and I wasn’t actually passionate about them. A lot of entrepreneurship is just moving from one setback to the next with enthusiasm, or whatever. There’s that Winston Churchill quote.

I realized how hard it was to do those businesses, so I was like, “The next thing I try, I need to make sure it’s something that I’m really into for a lifetime.”

I had been reading a lot of books, like Milton Friedman on economics and Ayn Rand’s work, and I was getting into these free-market, libertarian ideas. I was also living in Argentina for a year. That was a whole piece of the story, because I got to see a hyperinflationary country.

Why’d you go to Argentina?

Well, long—

Women?

No.

Okay.

No, sadly, no. I needed some adventure. I didn’t know what I wanted to do with my life. I had never traveled alone, so I basically went abroad and tried to put myself outside of my comfort zone.

I had never been in the military, and I’d never traveled abroad by myself. I was reading a bunch of books and thinking, “I need to go travel the world and figure out what I’m trying to do with my life.”

You went to Buenos Aires?

Yeah. It’s beautiful.

Yeah. Argentina’s a beautiful country.

Yeah. I learned from an economics point of view—

Oh, not like that. I meant the physical beauty.

Well, it ties together, because my understanding is that around 1900, more than 100 years ago—I think in 1908—it was one of the top 10 economies in the whole world.

It was called the Paris of South America. It was the first Latin American country that had a train station. You can see it in these historic buildings. They had massive wealth from beef, copper, and all these things.

Then, over a period of 100 years of bad economic policy—essentially socialist policies, with the government stealing wealth from the people while claiming to help them—it became the 100th-richest economy in the world. It went from the top 10 to 100th.

I was down there reading Ayn Rand and Milton Friedman and seeing how hyperinflation had decimated this entire country. Everyone was pessimistic about the future. These once-grand government buildings were in states of decay, with cracks, ivy, and graffiti on them.

This was around the moment when I thought, “Okay, the next thing I do needs to be something I’m passionate about for the long term.”

Within a year or two of that, I read the Bitcoin white paper. That captivated my attention.

The Bitcoin white paper was published at the end of 2008?

Yeah. I read it in December 2010.

You read it—

I had just come back from Argentina, so I was in the Bay Area deciding I wanted to be in tech entrepreneurship. I’d gotten a job at Airbnb, actually, and I was seeing how money movement was happening with them in all these different countries. That’s when I started working on the prototype for Coinbase on nights and weekends.

Wait, how did they move money to all these different countries back then?

Legacy payment rails. In the U.S. and Europe, it was a little simpler. You could use bank transfers, so they were accepting payments and then had to pay out to the host.

In many of the countries where they operated, like in Latin America, there would be some local cash-pickup service, kind of like Western Union, but it was different services in different countries. They typically had very high fees, like 7% to 12%.

I remember we were trying to send payouts into Ecuador, I think, or one of these countries. We were reading that there was a little oligopoly of 2 companies that did this in the region, and we were asking, “How much money shows up on the other side? What are your fees?”

We were reading through their documentation and thinking, “We have no idea how this works.” It was basically a borderline-corrupt system. We decided to send $100 and found somebody local there. How much money showed up on the other side? We wanted to get some rough sense so we could tell the customer how much their payout was going to be.

It gave me such a visceral sense of how broken the global financial system is. Each country has its own proprietary set of oligopolies. Imagine if the internet worked like this. You’d say, “I want to load a webpage from another country,” and they’d say, “You have to pay a high exchange fee.” It comes in a different language, and you have to wait 7 days or whatever.

Due to a couple of these experiences—the Argentina experience with hyperinflation, the Airbnb experience, and reading some of these books—I realized that the world would benefit from a global financial system that was fast, cheap, permissionless, and decentralized, so there was no small group of people who could be corrupt or put their fingers on the dials to manipulate it.

That was what I was thinking about as I read the Bitcoin white paper for the first time.

Okay, so you’re building your personal philosophy about economics and what’s important there.

Mm-hmm.

You know that you want to dedicate yourself to tech entrepreneurship as far as your career, because you’re going to be passionate about that, and you want to do something for the long term.

Mm-hmm.

You’re also seeing this real-life problem of trying to send money into all these disparate economies and countries.

Yes.

Then you start working on Coinbase on nights and weekends?

Yeah.

Okay.

Great summary, by the way. Yeah, this is where a little bit of that hustle and drive came in.

I was working long hours at Airbnb. They were a rocket-ship company, and I was learning a lot. It was an amazing team. But I really wanted to build something new for my next company. I still wanted to be an entrepreneur.

I’d work until around 7:00 p.m. at Airbnb, come home, eat a little dinner, and then from 8:30 p.m. to midnight, or so, 5 days a week, I would work on my startup.

And you always have to be very careful. You have to do it on your own separate laptop. Don't do it on company time or company property. Make sure it's separate. But I used my own laptop, and sometimes on Sundays I'd work as well. I'd take one day off.

But I was just grinding, and I was like, "Okay." I didn't know where to start, so you just have to start with anything. First, I went and talked to a friend of mine who I went to college with. We built this little Android app for Bitcoin, a Bitcoin wallet. I realized once we shipped that, we had done it the wrong way. I tried to recruit him to leave Google and be a cofounder with me, but he wasn't ready to do that.

So I started working on another prototype that was more of a cloud-based Bitcoin wallet, which eventually became Coinbase. I had to reimplement a whole Bitcoin node in Ruby just to try to get it to hook up to my database, and all these things. I was doing this nights and weekends while occasionally trying to find a cofounder and going on these cofounder dates.

Why did you think you needed a cofounder?

The main reason was that I had read a lot of Paul Graham's essays from Y Combinator, and I really wanted to get accepted into Y Combinator. It was the top incubator, and it still is, in Silicon Valley. Paul had these great essays, and one of them talked about how, if you look at Hewlett-Packard and Larry and Sergey, there are exceptions, but more often than not, great founders come in pairs.

Building a company is just so difficult. It helps to have people with some complementary skill sets. I was trying to find the right person to improve my chances of getting into Y Combinator, if nothing else, and of the company eventually succeeding.

Yeah, it's interesting because I feel like, even if you have cofounders, there's actually 1 founder. You could start out with 2, 3, or 4, and I know Y Combinator is like, "You need a cofounder," and that's something that's repeated. But if you read the history of entrepreneurship, it's like, "You'd start out with 3, 4, or 5." There's always 1 person—

Yeah.

—that's actually driving the company.

Well, it's like Wozniak and Jobs, right? Jobs was clearly the one that had more impact over a long period of time, but there probably wouldn't have been an Apple without Woz in the early days.

Yeah.

You never know exactly. In my case, I tried to find a cofounder for about 1.5 years and failed, so I eventually got the app live and got into Y Combinator. There's a whole story there.

Did you get into Y Combinator as a solo founder?

This is another interesting story, but I applied with this guy, Ben Reeves, who had created Blockchain.info, now Blockchain.com. He had never heard of Y Combinator, but I convinced him to fly from the UK. We met and had coffee, and then we went into the interview.

Which, by the way, was a bad idea. You should really cofound with people you've known for a long time. We got accepted, somehow, under that premise. I don't think we mentioned that we didn't know each other that long, or it didn't come up in the interview or something. We didn't hide anything, but it became clear within 3 months that it wasn't going to work. With the help of Y Combinator, I had a hard conversation with him about that, and I went through the program solo.

Anyway, long story short, I went through Y Combinator, raised a seed round at the end of it, and was lucky enough to have Fred Ehrsam reach out to me. He became the first person I really started working with on it, unofficially, and then it started going really well. We had very complementary skill sets, and I asked him to cofound with me. He became the cofounder of Coinbase.

I don't think Coinbase would have succeeded without Fred. If you look at the subsequent 3, 4, or 5 years, there were a lot of near-death experiences, and he was just an absolute killer. That pairing allowed us to really get to product-market fit and off the launchpad into orbit, if you will.

There are some funny stories from the early days of Coinbase, I've heard. Fred identified that you guys were losing money on every single Bitcoin transaction.

Yeah. That is true.

How did that happen?

The simple version of it is that I was a computer science major, and I studied economics and computer science. Fred studied the same thing, but he had gone to work in finance after college. He went to work at Goldman Sachs as an FX trader, and I was working as a software engineer and entrepreneur—a failing entrepreneur.

I had more of that engineering brain, and he had that finance trader brain. When he came in and started to analyze all of the flow of funds, he was able to map that out on every trade. Because of certain timing risks and these things, he was correct in mapping that out. It was just a set of conditions that I was not as familiar with.

That was a great example of him adding value in the first 3 weeks we worked together.

But that wasn't a near-death experience?

No, that one wasn't near-death. It was just getting the right business model and fee structure.

What was an example of a near-death experience?

An example of a near-death experience was, I think we had raised maybe the Series A or something like that. We had found product-market fit, so there were a lot of people using the site every day. We were having this huge backlog of customer support inquiries.

Every night from 9:00 p.m. to midnight, we would try to answer support queries because we didn't have a customer support team. We were slowly trying to build it, I should say. We had a backlog of 1,000, then 2,000, 5,000, and 10,000 customer support tickets, and people were getting very angry about all of this.

Because you couldn't respond?

Yeah.

I was one of those people.

Okay. You were early on Coinbase?

Yeah.

Okay. Well, apologies for the lack of customer support response.

To the point where I was looking up—I had a bunch of Bitcoin on there. There was an issue, and I was like, "What is the address? I'm going to have to fly to San Francisco because these people won't respond to my email."

Yeah. This is exactly what happened: people started showing up at the office. We didn't even really have the address published, but there was a photo of the office, and you could see a couple of buildings in the background. Some people found that, and they started showing up at the office at all of these odd hours. I remember Fred—

Back then, they had to be weirdos. The people who were into crypto back then were not your normal people.

I don't know. Once in a while, Fred would go answer the door holding a golf club. Usually, it was somebody saying, "Man, why didn't my crypto hit my wallet?" Sometimes we'd write people a physical check and say, "Okay, you need to leave the office."

That was the first time I'd really experienced having tens of thousands of people angry at you at the same time.

Because back then, it was the only place where you could buy Bitcoin with a credit card, right?

Yeah, or a bank transfer.

A bank transfer, right?

Yeah. Once we managed to get that bank partnership set up and an easy way to buy and sell in the U.S., we had instant product-market fit, and it was just a matter of trying to keep up with the demand.

Were you the first crypto company to do that?

In the U.S., yeah.

Yeah, exactly. How did you get the bank partnership?

That's its own whole story. By the way, there were other near-death experiences around cyber events and things like that we can talk about if you—

Yeah, I would.

—want. But on the bank side, this is another interesting story. Believe it or not, the first version of the Coinbase app didn't allow you to buy or sell Bitcoin. I thought we were making a wallet for payments on the internet. You could store Bitcoin, make Bitcoin payments, and this prototype went out. I remember a couple hundred people signed up from Reddit or something like that.

But the app was not retaining users. What they teach you in Y Combinator is to go talk to customers, get feedback, build the product, talk to customers, build the product, and just do that on repeat. Don't get distracted by any other bullshit, like going to conferences or whatever.

I remember I emailed about 3 of these people who had signed up, and I said, "Hey, I built this app. Can I get on the phone with you?" In the first few conversations, I said, "I noticed you didn't come back to the app." The guy said, "Yeah, the app was pretty cool, but I just don't have any Bitcoin."

I remember something kind of clicked in my head, and I said, "Well, if there was a buy button in the app, would you have bought it here?" I know it sounds ridiculous in hindsight, but at the time, this was market research. He said, "Yeah, probably." I said, "Okay, we've got to make a simple way for people to just buy it here."

It's not like you go to a separate exchange and then put it in your wallet for actual daily utility or something.

And so then I was like, “Okay, we’ve got to make it possible to get bank transfers hooked up, like PayPal or debit cards.” I remember calling different banks and saying, “Hey, I want to get integrated into the bank network through ACH.” It’s called ACH in the U.S. These banks would either say, “What the heck are you talking about? I’ve never heard of this thing. It sounds like a scam.” Some of them had heard about Bitcoin and, I remember, hung up on me. They were like, “We do not work with Bitcoin companies.” Bam. Just slamming the phone down, right?

Yeah.

And so I went to the partners at Y Combinator. Actually, one of them was Sam Altman at the time. He was running Y Combinator, and Gary Tan was there helping me, along with Paul Buchheit and these various folks. I remember they said, “Why don’t you go talk to Silicon Valley Bank? Silicon Valley Bank opens bank accounts for lots of Y Combinator companies. We have a good relationship there.”

They warmly introduced me to the right person, and the bank was like, “These guys are probably crazy, but we like to help Y Combinator, so let’s see what we can do.” They ran it through their compliance team, and the compliance team came back and said, “We think you might be what’s called a money transmitter, which means you need to have a license in the United States.”

I remember getting on the phone with them, and they were like, “Well, we can’t open this account for you unless you can prove to us that you’re not a money transmitter, or you have to get a money-transmission license.” The money-transmission license I researched was going to cost $5 million or $10 million and take about 3 or 4 years, and I’d only raised about $600,000 at that point. So I was like, “That’s not good.”

But they also said, “Well, if you have some legal argument that you’re not a money transmitter, maybe we would allow you to get started.” I remember going to a couple of law firms, and one of them agreed. He was like, “There are some arguments that you could make that you’re not a money transmitter. It’s a little bit of a gray area. I’ll write you a legal opinion saying, subject to the following terms, that you may not be a money transmitter, but it’s going to cost $30,000 for this 5-page piece of paper.”

At the time, I thought this was crazy. We’d raised $600,000, and I was like, “$30,000 for a piece of paper?” But I was talking with my advisors at Y Combinator, and they were like, “Well, if this allows you to get the bank account open and you can start to test your product idea, do it.” So I paid this guy the $30,000, and we got the account open.

I wrote all the code myself to do ACH integrations. You have to FTP these files to the bank, and it’s this kind of antiquated system. It launched, and it had product-market fit. Then it was like, instead of pushing a boulder uphill every day, the boulder was rolling down the hill, and you were just chasing it as fast as you could.

So you could buy Bitcoin through ACH, through a bank transfer?

Yeah.

Could you use credit cards back then, or no?

No. I think debit cards came a year or 2 after that.

Yeah. Okay, so even with just the bank transfer, you were flooded with customers.

Yeah, and we started to get some very anxious calls from the bank at certain points, too. They were like, “You guys have raised $600,000,” and every day there was $550,000 moving through the account. We’d debit these customer accounts to get the money, but we had to pre-buy the Bitcoin, so we had this cash-flow issue where we were basically using our entire balance every day just to service the current demand.

I remember the guy from the bank called me, kind of frantic, and he was like, “If you just have one error, you’re insolvent.” By the way, they might be on the hook for it, too. We might be at negative $1 million and just be insolvent, and then the bank’s on the hook for it.

I remember the guy told me on the phone, “You need to go raise money right now and get more money in your account, or we’re not going to be able to continue to serve you on these ACH network transfers.” You were in this tiny little sandbox, but now you’re suddenly growing like a weed.

I remember we took this graph of the daily buys. We didn’t even have a pitch deck or anything, and we just went out and, in a week, raised the next round and got $25 million deposited in the account. With a graph. Ordinarily, I wouldn’t recommend that, but we were sleep-deprived, and that’s all we had time to do. We just showed them a few pieces of data and said, “This is an up-and-to-the-right graph of demand, and the bank’s going to close our account in 2 weeks if we don’t get that money.”

That $25 million was from a16z and Ribbit? The Series A was from Union Square Ventures and Ribbit.

Okay. Yeah.

And then a16z was the Series B.

Okay. Yeah.

So who was doing the graph then? Was it Union Square Ventures and Ribbit on the graph?

That was—yeah.

Okay.

Union Square Ventures and Ribbit.

Was it Micky?

Yeah. You know him? Okay.

Yeah, I spent some time with him. I like him a lot.

He’s great. Yep.

That sounds like something he would do.

Yeah. Well, he was a Bitcoin believer for a long time before that.

Why?

Because he spent the first 36 or 37 years of his life living in South America.

Yep, Venezuela.

Yeah, exactly.

The people who had seen hyperinflation in countries got it right away. The people who had only spent time in the United States were like, “Why would anyone use a new kind of money?”

So, from your perspective as a founder, you thought your product at that point was a wallet and an exchange to buy Bitcoin.

Yeah.

And how long did you think that was going to be the totality of the business? Were you already thinking about product extensions back then, or no?

First, I knew there were a lot of ways to die along the way, so I was just trying to get the simple thing working. We had hackers trying to break into our systems. We had engineers quitting because it was overwhelming, and there was too much stuff. They were getting paged in the middle of the night, like 3 times every night, trying to keep the website up.

These banks might just turn us off, so I was just trying to survive the next few months. In the back of my mind, I knew that if we could get this thing to scale just on the first product, there were all kinds of things that this could disrupt.

That’s what I got excited about when I first read the Bitcoin white paper: this could be a new kind of financial system for the world that’s global and fair, decentralized, and more free-market-oriented. Anybody with a cellphone could have access to good financial services and participate in a global economy. The government couldn’t erode all of their wealth through inflation, as happened in Argentina.

So I knew that there was high potential for this eventually, but there wasn’t too much time to think about that. There was a lot of sleep deprivation and long hours, and I was just trying to survive the next 3 months.

And how long did that period last? Was it a couple of years?

Yeah. I’d say 4 or 5 years in, we were at a place where I felt like I could take a week off and the place wouldn’t blow up or something.

Who’s influencing your thinking—

Yeah.

—in terms of the kind of company that you wanted to build and the way you wanted to build it back then?

There was a book called The PayPal Wars, which talked about the early days of PayPal, and it’s actually pretty remarkable. You go back and look at what Peter Thiel, Elon Musk, Max Levchin, and all these guys were doing, along with David Sacks. They actually had many similar ideas to Bitcoin. They were trying to create a decentralized form of money that could be permissionless and global on the Internet.

Because of the history of the company and how it got acquired by eBay, and because a lot of the people left, it ended up being more of a checkout alternative with credit cards and stuff. But having worked at Airbnb, that also gave me a good picture of what was possible.

In college, I went to school at Rice University in Houston. It was an amazing school. I loved it. But it didn’t really have a startup environment. It wasn’t like Stanford or something, so I had never really seen a successful startup from the inside.

I had tried doing my own startup, which didn’t go super well. Inside Airbnb, it was like some magic was happening. They’d caught lightning in a bottle, and the thing was growing like wildfire. I got to see the way they hired people and had this really high bar for excellence and design, the way they made decisions, and a lot of other things.

Then I said, “Okay.” Before, in my mind, I had put it on a pedestal. I was like, “Wow, these are some crazy geniuses who are doing all this stuff.” There’s something amazing about getting in the room just so you can see how people work, and it doesn’t mean that they’re not geniuses. I think those guys are brilliant. It means I got to see it, and it demystified it. It made it feel possible that I could try to do something a little bit similar, right?

There are a couple of companies like that. Nowadays, I would say that certainly the level of ambition that Elon has and these things are very inspiring. I’ve tried to take bits and parts from Google and Amazon. I’ve been a student of lots of these companies and tried to take the best.

Anything from history?

Yeah. I really like the Wright brothers. They’re cool. Have you ever done an episode on them?

Yeah, episode 228.

You remember that? Wow.

Yeah.

Okay.

The book by David McCullough.

Yeah. I think that’s the one I read.

It’s an incredible biography.

Incredible. Yeah. I love big problems like that. You know, it’s kind of crazy, but it’s possible, and someone’s going to do it, maybe in the next 100 years.

And there are a few things like that: longevity in the biotech space, fusion energy, and strong AI.

The Wright brothers is crazy because that was a centuries-old problem.

Yeah.

Humans had been trying to figure out how to fly for centuries—

Yeah.

—before these two brothers in Dayton, Ohio, if I remember correctly, essentially solved that centuries-old problem with the modest profits of a bicycle shop.

Yeah.

And what was fascinating about them is that most of their competitors had more credentials and more financial backing. I think in David McCullough’s book, if I remember correctly, they solved powered flight with $1,500.

Yeah. It was some really tiny amount of money.

Yeah.

And there were people funded with 200× as much money. But I get very passionate about going after the big ideas that people could pursue. I think it’s actually worth everybody writing some of those down periodically, seeing which one grabs you, and thinking about whether you have something unique to contribute. Then just go for it. Those are the big, exciting ideas.

So, going back to where we were in the story, you’re like, “Okay, I just need to not die.”

Yeah.

“I have something working, and if I just don’t die, I can figure out other products or a way to grow the business in the future.” Were you thinking specifically about, “I want to build a company this way”?

Well, there were a few things I was thinking about. One was articulating a mission that could be bigger and writing down the values of the company, which we can talk about. Actually, we didn’t do this until we were a couple hundred people, because it all happened organically in the beginning. It was just who we were hiring, and the culture formed organically. But after we got a little bigger, we started to think, “Let’s formalize it.” I wasn’t going to be able to be in every single interview indefinitely, right? So: the values, the mission.

When did you arrive at the mission?

I don’t remember the exact year, but it was at least a few years in when we started to really think about it. For me, it wasn’t just getting people to use crypto or something. It was: Why do we want that? It was because it enabled everybody to own their own wealth in a way that couldn’t be taken from them and to attempt more ambitious things in life.

It was kind of like a foundation—basic property rights, as they’d call it in economics. If you had sound money, basic property rights, low friction to try new things in the world that might benefit people, and the ability to keep the upside of it, you’d have more people attempting those things. That very much appealed to me.

We take this for granted in the United States: usually, the money just isn’t going to be taken out of your bank account or something like that. But in many places in the world, that’s not true. There are places where the government will actually carry out seizures. Cyprus did this in the recent past, where it took a bunch of money out of everyone’s bank accounts to cover debt. There are refugees who have had to flee across borders at various times in history, with all their wealth confiscated.

There’s so much bureaucracy and corruption in places like Argentina that it’s difficult even to start a company. It creates a huge black market. And by the way, people can’t get access to loans or anything like that. One of the major ways people build wealth in the United States is by buying a home and getting a mortgage. Only wealthy people can really buy real estate in Argentina because you can’t get a mortgage and have to pay cash.

There are all kinds of ways that this is pernicious and decelerates progress, essentially. I was trying to think of a pithy way to articulate that, and I wrote down, “Increase economic freedom in the world.” It’s a little wonky. Sometimes people don’t know exactly what it means, and they have to go read about it. But it does encompass what we’re trying to do, and I think crypto is the best technology to increase economic freedom.

How were you recruiting talent back then? Were you sitting in on every single interview?

Yeah. In the very early days, it was just me going to meetups and trying to get anybody interested enough to come and interview. It was cold messaging people on LinkedIn and reaching out to people I had worked with in various contexts.

Why did it have to be outbound at that point?

First of all, crypto was a very niche thing. We were not a hot company at Y Combinator. We went to the demo day they do, where we raised the $600,000 seed round, but there were lots of companies that raised multimillion-dollar rounds and beyond. We were somewhere in the middle of the pack, maybe a little below, in terms of how hot the company was.

The only people we managed to convince to invest or join the company were people who had already gotten excited about crypto for some reason. Then they met us and thought, “Okay, this is semilegitimate, at least. They’ve gone through Y Combinator, they have this product that’s working, and they’ve had some early investors like Union Square Ventures.”

The first 5 or 10 people who joined were crypto zealots who just thought we might be a good company to bet on. As the company got bigger, we hired recruiting teams and the whole thing. We were competing with big tech in San Francisco during the zero-interest-rate phenomenon, and it was fiercely competitive. We eventually broadened out, opened other offices, and hired some remote workers. Hiring is its own whole topic.

Yeah. Well, I’m curious: have you found anyone else who thinks about it this way?

Yeah.

I talked to my friend Karim, founder of Ramp, about this. Daniel Ek, founder of Spotify—

Mm-hmm.

—they both think about it in the same exact way: they hire for spikes.

Yeah.

One of the benefits of being a founder-led company is that big companies try to manage the middle. They don’t want the high highs or the low lows. Karim and Daniel are both like, “No, I want the person who is the best in the world at this one tiny little thing, and that’s all I want them to do. I’ll deal with their usually excessive—

Yeah.

—or extreme personality traits on the other side of that.”

Yeah, I totally agree with that. We were looking at people’s past work and not necessarily their resumes. If they showed up in the interview and it was like, “Wow, I learned something. I left the interview with more energy than I went in. They’re a very efficient communicator,” and then they could point to things they’d done that were real outliers of success, we thought, “Oh, that’s awesome.” Or maybe we’d seen their work previously. These were people we would hire.

There are many examples of this. You talk about some of their personality quirks, and Balaji’s friend in Boston is this genius guy who was our CTO for a while. He did so many amazing things, and he’s very eccentric.

Actually, the very first hire at Coinbase was this guy, Olaf Carlson-Wee, outside of Fred and me, the co-founders. We were trying to hire someone to come in and run customer support because of the backlog I mentioned. I remember it came down to 2 finalists.

One of them was this guy who had run a team at Google AdSense. On paper, he was someone who had worked at Google and run a big team of 20 or 30 people—very credentialed. But in the interview, it was low-energy and not exciting for some reason, even though on paper he was superqualified.

Olaf came in, and his prior job was as a lumberjack. Literally. He had just graduated college. He wrote his thesis in college on Bitcoin, and then he did this walkabout, sort of a spirit-quest thing, where he went away for the summer and worked as a lumberjack.

He came in looking superdisheveled and threw on some ill-fitting suit he’d bought on the way to the interview or so, because he only owned lumberjack clothing. But the guy was superbright, superpassionate, superyoung, and superhungry. We were like, “Screw it. Let’s just give this guy a shot.” It was exciting to talk to him about crypto, and he crushed it.

By the way, he’s a billionaire. He went on to create a crypto venture fund. These were the kinds of bets we wanted to make. They were people who were entrepreneurial, and we’ve had a lot of success with that. I know Tobi talked about that recently on the podcast, too.

They were people who were high-agency, smart, and got shit done, even if they were totally unqualified on paper. Those were some of our best hires.

So, I was reading a ton of the Bitcoin subreddit around this time.

Yeah.

And am I wrong? Weren’t you getting a lot of shit because everybody was like, “This is decentralized,” and you were like, “Well, no, I’m actually trying to build a real business here”?

Yeah.

Did you have an issue getting talented people to work for you? Because you were kind of—this is it—you might be autistic, you might be right, because you were interested in this weird Bitcoin thing way before other people were. And then, not only that, you were bucking the trend in this weird subculture, too.

Yeah. People did often ask that. They’d say, “Isn’t the whole point of Bitcoin to be decentralized?” And I’d say, “Yeah, it uses a decentralized protocol. We just want to make it easy for people to access it, so you can choose to use our company, but you could use it at any company.”

As opposed to, let’s say, Visa. The only way to access the Visa network is through one company: Visa. But email is a better analogy. Email is a decentralized protocol, but you can use Gmail, Outlook, or whatever. At least there’s a choice.

But even going beyond that, for years we heard that as a criticism, so we said, “All right, let’s make a self-custodial wallet, too. If you want to custody your own crypto and not have to trust us at all, we’re going to put out a wallet for that.” We have a successful product now, too: our self-custodial wallet.

I think both are important. The centralized product gives people a lot of ease of use. If you forget your password, your money’s not gone—that kind of thing. It also allowed a lot of big institutions. Most of the money in the world—something like 80% or 90% of it—is tied up in financial institutions. It’s not retail people.

When we met with institutions and said, “Self-custodial wallets,” they were like, “That sounds super scary. We’re not going to do that.” They wanted these kinds of enterprise-grade custody solutions, and we’ve been very successful building those kinds of things for banks.

That decision was based on the response from the market, or is that a decision you made before and then brought to the market?

The one around institutions specifically was based on conversations with them, yeah. For the retail customer, though, I would say that was made prior to customer feedback. That was my intuition.

We’ve got to make this simple, easy to use, and trusted. The average person is not going to know how to run a self-custodial wallet on their laptop. The technology has gotten better and better, where account recovery and these things are now possible, but at the time, it was very scary.

Many people have had this happen, sadly. If they lost their password or something while trying to custody their own Bitcoin, it was gone. There are many sad stories about that.

Yeah, it’s funny because there’s a parallel here. When Steve Jobs had that observation, he said, “The first things we’re making at Apple, they’re for hobbyists.” But he said, “If you look at the number of people that want to put together their own computer, as opposed to the ones that want to go to the store.”

Mm-hmm.

He called it the appliance. He wanted to make a personal computer as an appliance. He said, “That market is a thousand times bigger.”

Yeah.

It wound up being millions of times bigger, actually.

Yeah.

But his idea was, the easier I make it, the bigger the market gets.

I think that’s right. A lot of these products start off with hobbyists who love the tech for the tech’s sake and want to take it apart. But ultimately, what crypto is going to do is just update the financial system so people have better financial services.

Many people are going to use it without even knowing they’re using crypto. They’re just going to say, “I don’t know, I just want to send money to my family abroad or whatever, and instead of paying 11% at Western Union, I just want it to arrive instantly for free or whatever.” They’re going to use stablecoins for that, right?

Or if they want to get a loan and it’s just using DeFi, it’s cheaper, with a lower rate, and they can get approved in 30 seconds. That’s easier than calling a bank and filling out all these forms, right? So, Coinbase’s app has evolved. Fast-forward to the modern day, you can trade any type of asset, not just crypto assets. You can trade stocks, commodities, and prediction markets.

You can get a loan, you have a Coinbase card that you can spend with, and we’re just trying to build better financial services now. Actually, that’s where you start to get into a multitrillion-dollar market.

So, you call it the—what—the “Everything app?”

The “Everything Exchange,” yeah.

The “Everything Exchange.”

Yeah.

And a super app, maybe you combine the two.

Okay. This is not a plan from the beginning. Bezos had “the everything store.” That was the code name of Amazon at D. E. Shaw, the hedge fund Amazon spun out of.

Hmm.

Yeah.

So, he had that master plan from the beginning, even though he started with books.

Yeah.

But that was not the case with Coinbase, correct?

I felt like more and more of the economy was going to run on Bitcoin because it was just faster, cheaper, and more global. I couldn’t have foreseen all of the things that happened. I didn’t foresee stablecoins, and I didn’t foresee prediction markets.

I just knew that we had a foothold with something everybody really wanted. Bitcoin turned out to be the best-performing asset class of the last decade, and so a lot of people wanted to buy it and hold it. We were the easiest way to do that. That was a wedge into the market to start to update all kinds of financial services.

And that’s how you thought about it?

I didn’t have a complete picture of that from day one. I think it would be intellectually dishonest for me to say, “I knew exactly how that was going to play out.” I knew that the potential of it went way beyond just buying Bitcoin or something.

I was like, “This could power the global economy,” because it’s just better than having certain countries printing their own money or having super-high fees in each country. We need a native financial layer to the internet that’s truly global and decentralized, and a bigger and bigger share of GDP could run on that over time.

I knew it was massive. I just didn’t know exactly how it would play out.

So, how do you think about running the company now? How is it organized?

There are lots of ways you can answer that question. I have a really amazing president and COO, Emilie Choi. She really is an amazing operator and allows me to focus on managing a lot of the product groups. I’d say I’m a pretty product-focused CEO. She’s operationally focused, and it’s an amazing combination of skill sets.

I actually think that a lot of enterprise value can get generated when you pair a technical founder with a great operator. If you have just an operator, they can make the company very, very efficient. Stereotypically—everyone’s different, right?—if you imagine only an operational leader, the company will run very efficiently, but they’ll miss their next wave of innovation or something.

If you have only a founder, sometimes they blow the place up because they’re always trying to do some crazy new thing. I think there’s a really healthy balance of those 2 things. There are other companies where, traditionally, you have Zuckerberg and Sheryl Sandberg, or whatever classic example you want to look at. I’d say even at Google, probably Eric Schmidt and Larry played that role, along with Sergey.

There are examples like that in history, I think. Anyway, it’s generated a lot of value for Coinbase to have Emilie and me both there.

And you get the most energy when you’re working on product?

Yeah. I don’t mind going and doing some policy, trying to get legislation passed.

You don’t mind it?

Yeah. There were times when I felt like, “Man, it’s draining to go to D.C. and meet with all these politicians.” I actually don’t mind it now, in a weird way. There are so many interesting people in D.C. There are big, big personalities.

Okay, hold on. We have to go into that because you said that earlier, and I was like, “I have to ask him about this.”

Yeah, yeah.

That is shocking to me.

Yeah.

That you find them interesting.

Well, here’s one thing I learned about my motivation: I can get excited about anything that helps advance the mission of the company, right?

There are times when, if you look at what I’m actually doing, it’s really not fun. It’s grind stuff. It’s just like, “Review 300 resumes,” or something. There was a moment when we didn’t have the right finance leader, and I was going to all these meetings with accountants. I took a class in college on accounting, but I’m not an accountant by any stretch of the imagination.

I was like, “If this is what is necessary at this moment to get the financial statements to a state where we can close this round or whatever, it’s generating value in the company.” So, I try to derive my sense of motivation from that.

A lot of times, the thing I’m doing is actually the gnarliest problem in the company. It’s like, “These 2 teams are super pissed at each other, and both the leaders are threatening to quit.” Or I have to go shut down this whole thing, and we’re going to lay people off or whatever. Usually, it’s the worst thing you’re trying to do, the thing you don’t want to wake up and do.

But I find a sense of fulfillment from it. I’m not a masochist about it. A lot of times, it’s draining, but I derive a sense of fulfillment from it: “Okay, this is moving the ball forward. At least I did something useful today.”

I like that idea of you essentially searching for bottlenecks in the company.

Yeah, that’s a great way to put it. Actually, Elon frames it as, “What is the limiting factor at any given time?” I go dive deep on that. That is a very good principle.

I’d say the last thing is that we try to push decision-making down in the organization. It’s hard to do, but that means making clear DRIs for each of these different things and trying to amp up the pace of execution. It’s hard to do as the company gets bigger because you have more stakeholders and all this, but it’s about having a single decision-maker, pushing it down, and giving people short time frames to knock out a decision: unblock this, go, go, go.

I try to be a little bit of the pace car for that and provide risk tolerance to the organization when needed.

Let's say somebody comes and says, “Hey, I think we should try this thing. It’s a kind of crazy idea, but if it worked, it’d be amazing.” It’d be a 20x outcome, but it has a 20% chance of success. That’s a bet you should take all day long.

But most companies are risk-averse. They won’t do something that has a 20% chance of success. I’m like, “Go for it. If it fails, it’s on me.” I try to give people air cover for those things. So, that’s a little bit about the decision-making and how we do that.

What other elements of the company do you think are a reflection of your personality as the founder?

The fact that we have 4 or 5 product groups is probably a little bit of a reflection of my personality. I always want to build new things, almost to a fault. Actually, we have a lot of good systems in place to be rigorous about resource allocation, because you don’t want to get too spread too thin.

But I keep having the ambition to go build new things and new categories. In the age of AI, that might actually be more valuable.

How so? What do you think?

Because if you have unlimited agents—

Because it’s lower cost to try it?

Yeah. If you have all these ideas, you’re usually constrained by time, resources, or actual physical people to go and implement all these ideas coming out of your head.

Yeah.

And now you have on-tap, on-demand intelligent coworkers.

Yeah. That’s true. The cost to get a V1 running is now much, much lower.

Yeah. And we are seeing that internally. Now, to see something through still takes an intense amount of work. But we think a lot about resource allocation, where you can have a 2- or 3-person team just try these ideas internally, and then, only if it starts to work and hits key milestones, you do the Series A internally.

So, we try to treat it a little bit like venture capital.

Is this the language you use inside the company?

Yeah.

Really?

Yeah. One of the key things we did was that twice a year, any employee can come pitch and say, “Hey, I think we should be doing this, and I have the team to go do it.”

In most companies, you have to get your boss to say yes, your boss’s boss, your boss’s boss’s boss, all the way up to the CEO. So, you have to get 5 yeses in a row, which is basically a committee. If one person says no, it won’t happen, which means the company’s risk-averse.

What we’ve tried to set up internally—we call these Next Bets—is that you can come in and pitch. Each of the product group leaders has their own budget. I’m there, the CFO’s there, Emilie, maybe 1 or 2 really talented young engineers, and if you get any 1 of us to say yes and fund it out of your budget, you’re greenlit.

So, it’s kind of like pitching to 10 venture capitalists.

So you almost inverted it?

Yeah. You only need to get 1 yes if someone wants to fund it out of their budget.

There have actually been examples where I voted no on something and it turned out to be a massive success. An example of that is USDC, which is the stablecoin. I’m embarrassed to admit that I voted no on that idea. Luckily, somebody else funded it out of their budget, and I think in 2025 we did about $800 million in revenue off it or something.

It tells you that sometimes good ideas can come from anywhere. I was reading about Steve Jobs and Wozniak. Wozniak went to his employer, HP, and told them, “Hey, I think we should make a personal computer.” They said no, and then he left to found Apple.

Many such cases. Sam Walton tried to give away the idea for Walmart. They said no.

Yeah. I always have a little bit of that fear in the back of my mind that there are brilliant young engineers inside Coinbase. I want to make sure they can come and pitch, and somebody, even if it’s not me, funds it.

How much time do you spend on Coinbase marketing? Are you interested in it at all? You guys are doing very unique things around marketing.

Thanks for noticing that. I wish I could take more credit for it. I actually think it’s the team entirely. They come and show me the things they’re doing, and the only thing I’m doing is trying to give them air cover to try crazy stuff.

Whenever they show me something, I’m like, “That’s awesome. Run with it,” whereas I think some organizations would be a little too cautious or hesitant. What they’re doing with putting QR codes in the Super Bowl, or the karaoke thing they just did at the Super Bowl—I don’t know, they’re trying more ambitious ideas, which I like.

A lot of marketing now is actually more like content on the internet than a typical brand ad running on TV. A very simple example was when we were putting out our earnings calls. As a public company, you put out your earnings. They’re usually dry and boring. Analysts tune in and listen to these calls, and you’re on a conference call using this really ancient technology and an ancient vendor.

I remember I was always so bored on these earnings calls. I was like, “How do we spice these things up? Can we just do something more interesting?” Some of the people on the finance team were like, “Brian, stay on script. It’s supposed to be boring. Just report the numbers. That’s all we’re doing here.”

Yeah.

I was like, “No! This is a marketing moment. We’re supposed to be selling some stock, right? Let’s go out and tell the story of the company.”

So, in this recent earnings call, we put together a pitch deck, kind of like we were pitching when we were a private company. I wanted to run through the deck and make a video of me. Then we put it on the website, and one of the guys on our marketing team paired it with a video game.

Have you seen those vertical videos where—

I saw this.

Yeah, the guy’s running through the game collecting coins.

So they realized, on short-form—

Yeah.

—you can have somebody speaking, but then, if you put somebody playing a video game or whatever the case is, or going through a maze—

Yeah.

—the retention goes through the roof.

Yeah. So, we have these young, Internet-native marketing people. They’re not like the people who made ads for Coca-Cola or something.

Yeah.

They’re just people who’ve lived their whole life on the internet and in meme culture, and all this kind of stuff.

Somebody could reasonably say, “Well, Brian, are you trying to turn the company into a meme stock or something?” I’m like, “No, not really.” I think we’re building something very serious and important as an institution that’s going to stand the test of time. But we do need to get the word out in the way that people actually consume content today.

Frankly, I think our shareholder letter is brilliant. I get a lot of good feedback on it from the biggest funds at Fidelity and all these kinds of folks, so I’m glad we’re putting out a shareholder letter. But 99% of people aren’t going to read our shareholder letter. They’re going to see some clip on social media about the company, and that’s how they’re ingesting their information.

How do we speak in an Internet-native way? That is marketing.

Everything is marketing.

Yeah. Everything’s content.

I like that you had this idea of, “Why don’t you actually make them interesting?” You said you have to get attention. People have to pay attention to what we’re doing, or they’re not going to. It serves the mission, too.

There’s a great maxim from David Ogilvy about this. He says, “You can’t save souls in an empty church.”

Yeah.

If you want to save their soul, you have to get their attention first. You’ve got to get them in the door first.

Well said.

How do you compose your shareholder letters? I’m going through this right now. I just reread Warren Buffett’s shareholder letters since the last one came out. That was the best marketing he ever did.

Mm-hmm.

Each year took him about 7 months of going back and forth with—I think her name’s Carol Loomis.

Mm.

You read them, and they’re technically about a public company, but they’re fascinating. Essentially, he thought about it as if he were just teaching.

Yeah. So, that’s a great point. Bezos did that, too, right? He’s got some bangers.

See, Buffett’s different because it’s like 70 years or whatever. Bezos, I think, did it for 21 years. He distilled it down to maxims, where his last shareholder letter was, “Differentiation is survival.”

Yeah. I think those are probably the best technology company shareholder letters I’ve ever seen, I’ve ever read. Those guys are putting in a level of craft into them, and partly it was a product of their time.

I think the way people consume this has changed, as we talked about. Our shareholder letters are good. I think they’re really just reporting the numbers primarily right now, so they’re written for analysts, whereas I think the Bezos and the Buffett ones might have been written more for teaching people about business, almost.

I think Bezos was teaching his very interesting philosophy, essentially using that as almost like a tuning fork: “I’m putting this out, and the right shareholders for me in this weird strategy I have—”

Yeah.

—will respond to this information.

I wonder if you could do the same, though. That’s a great point. I hadn’t thought about it. We could put more of my philosophy in it.

I think what I want to try is actually going through—for me, the medium of just talking through a deck and getting me talking about it can be a little bit easier.

There is something powerful about forcing yourself to sit down and really distill it in writing, which can be clarifying. So, I'll think about that.

Wait, so do you prefer being prompted? You said, “We put a deck, but just film me going through the deck.”

Yeah. I'm not reading the deck, but I want to tell you it'll help me clarify my thinking. It's like, “Okay, here's the mission of the company. What are we building?” We're just building better financial services with crypto. How do we measure our progress on that? Here are our key metrics: trading volume and market share, transaction volume, and the assets on the platform. We have a whole theory about how we're growing that as the most trusted brand.

You can also just go through a bunch of objections people commonly would bring up, right? “Okay, let's have a slide and address that, and that, and that.” Then you can take submitted questions, too, and riff on those. I think that's a good format for us to play with. But I hadn't really thought about the Buffett and Bezos analogy on the shareholder letters. Those guys went deep. That was very atypical.

Yeah, I would argue that the Buffett shareholder letters are the most successful example of content marketing in history.

Hmm.

If you think about what it did for his reputation, and the fact that he then got access to proprietary deal flow as a result of that. So, if you don't feel that people are reading the shareholder letters, how do you think they're consuming information about public companies, then?

Well, I think there are a number of analysts who are reading the shareholder letters, so I don't want to say there's none.

Yeah.

But I think most people, like retail investors—even people who aren't specifically tracking public company stocks at that level of detail—they're consuming podcasts. They're probably listening to your podcast. They're reading social media like X, blog posts, and Substack. I think some of them still read traditional media, but that's dwindling, especially among people under, say, 65 or something.

Every company is a media company now. You should be publishing your own content directly to your own blog and social media. Some companies have their own podcast.

You know how many founders have been telling me that recently?

Yeah.

Why do you arrive at that conclusion?

Well, part of it was the “Mission First” blog post.

Mm-hmm.

One of the formative experiences, I would say, as a CEO was that, after that happened, several traditional media organizations wrote very negative and false stories about us. It made me really appreciate how they're not doing journalism in the traditional sense of the word that I think of it, which is to report the facts and investigate things that need uncovering in the world, which is a very important thing. They're actually more like political propaganda machines, and if it doesn't fit their narrative, then they'll put out stories that are fake or misleading. I shouldn't have been surprised. There's a long history of this going back to yellow journalism.

Joseph Pulitzer.

Yeah. Yeah, exactly.

Because people give me shit because I don't read the news at all.

Yeah.

I just read old books and then talk to founders now.

Yeah.

That's essentially my entire media diet. And then talking to LLMs.

Yeah.

And they're like, “You're not informed.” I was like, “Have you read William Randolph Hearst's biography?”

Yeah.

Who invented yellow journalism? Just read anything that's happening now—

Yeah.

—derived from those 2. Especially in America, those were the 2 most influential and powerful people in media. They literally changed the way that newspapers and written text came out to make it intentionally more salacious—

Yeah.

—and more exaggerated.

Yeah.

What did Hearst say? “You provide the photos, I'll provide the war,” or something.

Yeah.

Yeah. And so, anyway, I think most people have become aware of this now. Trust in traditional media is at an all-time low. So, luckily, things have moved on. I think social media has its own challenges, too, about misinformation and whatnot, but at least you can go direct and put out whatever you want to say. If people like it or don't, it's fine.

I think it's good to talk to new media as well. Anyway, that was a formative experience, and I actually think it was very liberating in a way. I think everybody, at some point in their life, should get The New York Times to write a hit piece on them, because you stop fearing it and start realizing what you think is the right thing to do now, because there's not some terrible thing that could happen to you anymore. It doesn't matter. Once they try to do it and it doesn't do anything, you realize, “Oh, okay, I'm not trying to optimize for optics here or doing something that looks good. Why don't I actually just do the thing that I think is good, regardless of how people perceive it?” That's very liberating. I hope more people experience that.

When did you go through that?

It happened in many small ways as Coinbase was growing. We'd see articles come out that were like, “What? That's not right. What are they talking about?” They wouldn't post a correction. Sometimes you'd get these calls from journalists that were like, “I'm posting this in 4 hours. Will you comment?” And we're like, “What? This is totally false information. What are you talking about?” It was just this kind of annoying tax that was always happening on the company.

What really radicalized me on it was the “Mission First” blog post. Several organizations, but The New York Times in particular, I remember, basically put a team of people—I was later told by insiders—they were like, “Just go dig up dirt on this company and write negative articles about them.” They had the headline written before they had even found anything. They wrote articles implying that we were racist, that we were underpaying certain minorities, and things like that. It was false information.

That basically pissed me off, and I was like, “Okay, I don't really want to engage with them. They're not engaging in good faith.” They're so biased, they don't even realize it, and they have some political agenda. It's not really journalism. It's like a political propaganda company or something. That was frustrating, and it shifted my point of view toward going direct.

You had a unique experience because you're building a company, but you're also starting at the very beginning of an industry. I was thinking about you earlier today, and the analogy that kind of sticks in my mind is the early American automobile founders. It's like, “I have to learn how to build a car company, but we're building an industry simultaneously.” If you start a software company today, you're not building the software industry. The software's been around. What was that experience like?

It's a really good point. Henry Ford—you probably know about it, right? It's like when the cars came out, and people were freaked out about, “Your cars are going to scare the horses.”

Wasn't there some law—I remember Marc Andreessen told me about this—where, when automobiles first came out in cities, somebody passed a law that you had to run in front of the car with a flag?

Yes.

So as not to scare the horses.

Yeah.

So, inherently, if you are—crypto is a brand-new industry. It's updating all financial services, and it's like that Gandhi quote: “First they ignore you, and they laugh at you, and they fight you.”

And then they confront you at Davos and wave their finger at you.

Yeah, and then you win. So, we're at stage 3. There's a little bit of fighting happening, but most of the big banks and financial institutions are embracing crypto. 5 of the G-SIB banks in the world, the largest banks, are working with us now on crypto integrations. If you look at their LinkedIn posts, they're all hiring crypto people, product managers, and engineers. So, it's working, and we want to work with all of them. This is a little blip on the policy radar; it's just a little negotiation happening.

Peter Thiel says, “You have to be contrarian but right to be an entrepreneur.” So you have to be comfortable looking stupid for a long time. When I was calling those banks and saying, “Hey, we're a crypto company. We want to do this,” they would hang up on me. I'd go pitch the 30th venture investor and get a “No,” or the 1,000th employee we tried to hire, or whatever. We're willing to be misunderstood for a long time, and then you slowly start to have these breakthroughs.

If you look at Uber, they were fighting for a decade just to say, “Yeah, it's actually better and safer than a cab,” and the entrenched interests were fighting them, right? Or Airbnb with the hotels, or self-driving cars. Everything that's truly innovative and groundbreaking is going to upset an entrenched incumbent, eventually intersect with the government, and piss off some segment of the population who are like, “How dare you question the status quo?”

The Wright brothers—I mean, when they came out with the airplane, nobody believed them for years. You read the biography: they went to the United States government and were like, “We've created flight.” They thought they would be celebrated.

They had to go to Europe.

Yeah, they went to Europe.

They were doing these demonstrations on this guy's field in Ohio, and there would be 3 people watching them.

Yeah. Wasn’t there that famous quote from the War Department? They said, “We see no military application for the airplane.” And 40 years later, it won World War II.

If I remember correctly—

Yeah. I haven’t read the book in probably 6 years. I should reread it and do another episode on it. But I think the French government was—

Yeah.

—the first person to actually buy it for the military.

Yeah. So, that’s the nature of innovation: You have to be willing to be misunderstood. The key part is, you also have to be right. You can’t just be throwing out crazy ideas that are wrong and incorrect.

Yeah, but for them, they’re creating an industry and a company.

Yeah.

But they actually didn’t create the most successful company in that industry, where you did.

That’s true.

It’s true. Well, I think Orville and Wilbur were more like—

Well, Wilbur died prematurely, I think from consumption or maybe tuberculosis.

I forgot what it was.

Yeah.

He died at 45.

Yeah.

Orville lived for a lot longer, but basically, they created the industry and one of the first few companies. Then they were overtaken in a way that you have not been.

Yeah. So, not to torture this analogy too much, but I think of Wilbur and Orville as inventors. The equivalent in this case would be Satoshi Nakamoto, or someone like that—brilliant, whoever they are. There’s an interesting documentary coming out on this soon. Whoever those people are, they’re probably innovators and scientists.

I don’t consider myself really a scientist. I’m more of an engineer and entrepreneur, so I recognized early what was happening with the invention of Bitcoin. But I didn’t invent Bitcoin myself. I did not “discover” flight like the Wright brothers.

I’ve always had a lot of respect for people like Edison because they’re actually on the frontier of making scientific breakthroughs. Who knows? Maybe this will happen at some point, but I don’t think I’m going to be the person to make a scientific breakthrough.

What I am going to do is have an instinct, or a nose, that something interesting is happening here, that it’s created an opportunity, and that I can commercialize it with a really successful company.

Edison was obsessed with commercialization, though. He said that he didn’t want to invent anything that didn’t sell, and that a sale is proof of utility.

Yeah.

He has a great line on that.

Yeah.

So, you have your mission at Coinbase, but you said your natural inclination is to work on multiple things, right?

Yeah.

You started another company.

Yeah.

You want to talk about this?

Yeah, sure. Broadly, I want to accelerate civilizational progress in the world. That’s my personal mission. I think economic freedom is foundational to that with crypto.

When Coinbase went public and I got some liquidity from that, I was also thinking, “Okay, what are the other big problems in the world, in hard tech—not just software—that might require more capital that I could try to help with?”

The big ones on my mind were AI and crypto, which are probably the 2 biggest right now. Then, of course, there’s fusion energy, brain-machine interfaces, and space. I felt like, “Okay, there are good teams working on all of these, and I’m not sure what unique thing I have to add.”

The other big one I thought of was longevity. How do we start to reprogram our own biology to enhance what it means to be human at some point?

So, I started hosting these dinners. I didn’t see teams working on that that I thought were credible. In fact, the longevity space has had a lot of snake-oil-type stuff. It attracted some unsavory characters, a little bit like crypto.

For centuries.

Yeah.

For centuries.

For sure. I reached out to a couple of friends of mine who were biotech CEOs or PhDs and started to host some dinners. This is also a good way to learn: Try to convene some of the top people in the room, go around the table, and ask them, “What’s the most interesting thing on the horizon that’s underfunded or underinvested in?”

We hosted a couple of these dinners. I was lucky enough to do this with a friend of mine, Blake Byers, who we eventually co-founded this company with. One of the topics they told us about was epigenetic reprogramming, which is the ability to reprogram cells so you can restore the function they had when they were younger.

There had been some early breakthroughs in different labs. One example was Shinya Yamanaka, who won the Nobel Prize for reprogramming skin cells into stem cells. I think he got that in 2012, if I’m not mistaken.

I started to feel about epigenetic reprogramming the way I did about Bitcoin when I first read the Bitcoin white paper. I was like, “How deep does this rabbit hole go?” If you can actually reprogram cells, it turns out our cells are much more plastic than people realized. What could be possible with that?

Through a series of these dinners, we met the other co-founders, Jacob Kimmel and Greg Johnson, and created this company. It’s called NewLimit, and it’s a longevity company searching for novel therapies that can reprogram your cells to restore the function they had when they were younger.

It’s been going for about 3 or 4 years now. We’ve successfully demonstrated reprogramming human cells for the first time to restore function. It’s a discovery platform that’s testing tens of thousands, eventually millions, of hypotheses in high-throughput screens across lots of different cell types. It’s using AI to prioritize those screens.

The first drug candidate is going to go into clinical trials probably next year, so it’s gone faster than I thought, actually. I committed $100 million of my own money to help it get off the ground, and it subsequently raised more money from others as well.

I thought it was going to be a pure research thing for maybe 5 or 6 years, or who knows. It turned out the scientific progress happened a bit faster than we thought, and we’re ready to go to clinical trials now with the first drug candidate. Hopefully, there’ll be 3, 4, or 5 drug candidates over the next 5 years.

Do you think you’ll continue to start more companies?

I do, yeah. Both within Coinbase—there are lots of these product groups—and elsewhere, I think it’s fun. That’s the most fun thing in the world: building companies that try to have a positive impact on the world and try to be useful.

I’m getting slowly better at it over the decades, hopefully, and learning a lot of painful lessons along the way. So, yeah, I don’t want to get distracted and have too many things. Each one of these is really difficult.

But I do think that over the coming decades, hopefully I’ll start more companies.

Do you think Coinbase is the last company you’ll be CEO of?

Oof, that’s a tough question.

While you think about it, let me tell you why I asked, because I was shocked when I was talking to Tobi.

Yeah.

He said something—I think it was on the episode—that if the advancements in AI weren’t happening right now, he thinks he wouldn’t be the CEO of Shopify anymore.

Yeah. I was surprised to hear him say that, too.

Yeah.

I heard him say that. I don’t feel the same way he does about that. AI is changing everything about how we work and lots of things in financial services.

We haven’t talked about that. We need to talk about this.

Sure.

But after, let’s go there next.

Yeah.

Don’t let me forget.

I want to continue being Coinbase CEO for a long time.

Do you like being CEO?

Yeah. I always clarify that I find it very fulfilling, which means that it’s sometimes very stressful, sometimes it’s super fun, and sometimes I just get my ass kicked. I’m like, “Oh, man, that was a rough day.” You’re just going and doing the hardest things that get escalated to you because nobody else in the company can do them.

But that’s what creates fulfillment, right? It’s a little bit like playing a video game or something. It needs to be a really hard level that’s a little outside your comfort zone for you to feel like, “Whoa, okay, I beat that. I was right at the limit of my ability.”

When you’re having these very stressful times in your life based on work, what do you do to decompress or take time away?

I think it’s a very important topic because, among the other founders who were in my Y Combinator batch, I saw many of them burn out within 3 to 4 years. It manifested in lots of different ways.

Some of them would gain a bunch of weight, and some of them would lose a bunch of weight. One of them had hair falling out. I was bald before starting a company, but literal clumps of hair were falling out because of the stress. Some of them got addicted to prescription drugs.

Dealing with stress as a founder is actually a very important topic, because you can burn the candle at both ends for a period of years, but eventually you’ll burn out. You need to make it sustainable to have the impact you want to have over a period of many decades, hopefully.

The kinds of things that I baked into my routine—and every couple of years, I felt like I hit a patch of burnout and had to change something up—were delegating more, stopping some piece of what I was doing, and having fewer direct reports. Then I had a routine around sleep, exercise, and nutrition.

And some form of meditation or prayer in the evening. You can go to the sauna, or in the morning you can just sit there and meditate for 1 minute, or whatever it is. I have a pretty strict routine when I’m in work mode around sleep, exercise, what I eat, and then just a wind-down time in the evening.

And then, on the weekends, I mix it up, and I'm not so strict about things. But I even wear the same thing every day, right? So I'm pretty rigorous about that. Basically, I'm just in this routine of, “Get enough sleep, wake up, lift heavy things, and do zone 2 cardio.”

Yeah.

And meditate for a few minutes and then get after it.

What's your wind-down time at night, though?

It's basically like—

Wine and lovemaking?

No. “Don't look at screens” would be the main thing, right? If you're looking at work stuff on your laptop or your phone, and even something you just glance at for a second, it can piss you off. And then, if I try to just go right to sleep after working, I have stressful dreams about work, and I just don't get well-rested. So there does have to be, I think, a period of time to—

How long is this wind-down time?

Oh, like an hour.

Okay.

Yeah.

Before bed?

Yeah.

Okay.

Yeah, and you can read, watch stuff, go to the sauna, whatever.

Yeah. Before we go to how AI is changing the way you're working inside Coinbase, a question I was thinking about was, “What's the distribution of time between Coinbase and your other company?”

Well, Coinbase is my full-time job.

So, it's like 99%?

Yeah. I mean—

If you looked at how you're spending time between the 2 companies.

Yeah. Well, when NewLimit was just getting started, I was spending more time with them, like 5% to 10% of my time. I'd jump in whenever needed. But I'm primarily an investor and a board member there.

Mm-hmm.

And then I'm helping with some of the operational pieces and helping them raise money and things like that. But, yeah, Jacob Kimmel is the president operating that company day-to-day, and he's crushing it. He's an incredibly talented CEO and a businessperson.

I talked to—

Sorry, I should say scientist and a businessperson.

Yeah. I talked to Palmer Luckey about this because that's something I asked him. He's like, “We have 3 companies.” He's like, “No, I really have, like, 1.” He's like, “99% of my time is on Anduril.”

Yeah.

And then he said something fascinating. He just wakes up every day and tries to think of the highest-leverage thing he can do for that company—

Yeah.

—even if it's stuff—

Yeah.

—he doesn't want to do—

Yeah.

—which is very interesting.

That's exactly right. It's so easy to get caught up in just doing short-term things, but you have to start your day usually with the thing that sucks, that's the most important thing, and usually it sucks.

Yeah. So, how is AI changing the way that you're working in Coinbase?

Well, lots of ways. Some of it is similar to other companies, and some of it's different. The parts that are similar are that more and more code is being written by these agents—more than 50% now. Customer support inquiries, I think, are about 60% answered by agents now.

Are you building your own tools, or are you using other people's tools?

Both. We're using vendors. We have a lot of custom models internally as well. We're testing different use cases. For instance, around compliance automation, we're building a lot of stuff in-house. With design, you can really quickly prototype stuff and get it out there. We're even using it within our finance function to do FP&A, build models, and things like that.

Even decision-making in the company—the key was getting a lot of our data ingested, like all the Google Docs, the Slack messages, the GitHub commits, and Salesforce. Now you can ask it really great questions, like, “What should I be more aware of as CEO?” And it's like, “Did you know this team is not aligned on the strategy?” I was like, “Actually, I didn't know that.”

Mm-hmm.

You know? So, yeah.

This is something you build yourself?

There's a team internally working on this, and there are a couple of vendors. There's one called LibreChat that's open source, and you can connect all your internal data to it. There are other vendors out there, like Glean and Slackbot. We're testing 3 of them or so right now. Gemini is doing a bunch of stuff with Google, so we're testing all of them to see which ones employees gravitate toward, basically.

That's, I would say, current best practice among a lot of tech companies—not super unique to crypto. The thing that's more unique to crypto is that these AI agents are increasingly needing to do payments to get work done, and we're giving them all stablecoin wallets.

You can imagine, in the traditional financial world, you and I can go get a credit card or something where we have to be identified as a human. But if you're an agent trying to get work done, you either have to bug your human every time, like, “Will you approve this purchase?” Or, increasingly, you can tell these agents, “Just go do this overnight, or over the next hour, week, whatever,” and get work done.

They might need to spin up AWS resources, get through a paywall on the internet to read some research paper, buy a domain name, or spin up a marketing program. If you really want to treat them almost like their own digital employees, they need to have a corporate card kind of thing, and traditional corporate cards can't be issued to nonhuman entities. So we're giving them stablecoin wallets. They're doing a lot of machine-to-machine payments.

This is all very new in the last few months, but it's been getting a lot of traction. So that's pretty exciting. We built a couple of tools that allow any AI agent to get a stablecoin wallet inside it.

How are you using them personally?

AI agents or—

Any kind. Yeah, agents, any kind of tools.

Well, I've been using Claude and Codex a little bit just to learn the current development tools. I've been spinning that up locally on my laptop, just to make sure I understand the current best tools that developers are using. Tobi actually writes a lot of code still in production.

It just came out. Did you see the tweet today?

Yeah. I dabble, but I do not write that much code in production. I have to admire him for that.

As a CEO, the main thing I use it for is research, essentially—just like, “Okay, help me understand this and this, how this works,” and then, “Draft this for me.” Internally, with these data repositories now connected in, I can use it for decision-making.

We use a decision-making framework, and there's a row now for the AI agent to write in its input. It's kind of nice to compare it to the other people on the team. Those are the primary ways that I use it today.

I'm still a little confused. Tell me about the Base App.

Yeah.

I've watched the presentations.

Yeah.

I've talked to you about it. I'm still confused.

Yeah. Okay. The simple way to think of it is that the Base App is the self-custodial version of Coinbase. We launched a new version of it recently, which, frankly, was kind of polarizing. We put it out, and it was trying to do something kind of novel on the social front. I don't think it quite worked. We got a bunch of feedback from the community about that.

Was this the tap thing?

Well, you could double-tap to buy a new post.

Yeah. I understand that, but then each post almost had its own market cap. But then what happens?

Yeah. Well, it was interesting. Every post had its own coin, and every creator had their own coin. It was optional for the creator. But what happened is, if you bought a post, some of the economics would flow back to the creator.

We thought maybe each post would have this up-and-down, and it would have residual zero value. It turned out that many of the posts had a couple thousand dollars of value or something at the terminal end of it. People were thinking of it as a way to reward and thank the creator, but they also owned some of the creator coin.

Long way of saying, I think something is going to work in this space. They call it SocialFi, or these kinds of social media tokens. I don't think the tokenomics have quite been figured out yet. For the people investing in them, it needs to have some sort of durability. They have to believe, “Okay, David Senra is going to continue to make great content into the future. He's relatively undiscovered now, but he's going to be much bigger in the future. It's kind of like a company or something.”

They would want to own your creator token, and there'd be some value. Maybe a revenue stream would accrue to them over time, depending on your ad revenue. You'd have to come up with something like that that I think is a little bit more durable.

In the current incarnation, it wasn't quite there, in my view. So we tried it as an experiment, and it didn't quite work. The app has since pivoted to really just be more focused on trading and being a self-custodial version of the Coinbase app. We're starting with that for now. But I do think something in the social token space will eventually work.

What else has been on your mind outside of Coinbase? And is it NewLimit?

Yeah, NewLimit.

Yeah.

Well, there's another project that I invested in and helped get off the ground called ResearchHub, which is trying to accelerate scientific research. They're trying to find novel ways for people to raise money. The funding problems in science are a whole thing, and replication is an issue. We can talk about that if you want.

I think, through my family office, I'm making various investments in companies that I think are doing innovative stuff on the frontier. I think sometimes about, “What are the other big ideas that could really unlock progress?” One other idea I'm interested in is actually special economic zones in the US or elsewhere, where there's such a morass of red tape—federal, state, and local—that it's hard to get innovation off the ground sometimes.

That money transmitter license thing is an example that I mentioned, where you needed 5 or 10 million dollars just to get the licenses.

Sometimes, entrepreneurs can find a creative way around these things in the early days. But for instance, look at nuclear energy. It's basically impossible to get a nuclear power plant. Well, I shouldn't say “impossible,” but it's very difficult right now.

And if you had these special economic zones, China's been very successful at this. Shenzhen is a special economic zone, essentially, right? Or Hong Kong, or in the UAE, they have these. There have been examples of these around the world that have unlocked a ton of value.

In my ideal world, you'd have 10 plots of land—take federal land in the US and designate them as special zones. So you could have one that's, “Hey, in this sandbox, you can iterate on nuclear reactor design in this one little area. Okay, maybe something bad will happen, but it's contained in this area. We need to be on our front foot and innovate there.”

Or have another one for biotech, with accelerated trials, or another one for crypto, or another one for drones. There are just drones flying all over within this zone outside of traditional FAA rules, allowing people to really innovate and build startups. And if they get a product working through that rapid innovation in a regulatory sandbox, they can then go apply for the license federally and serve the rest of the US market.

But the problem is, it's such a high barrier to entry to even try to get started in some of these markets with these new technologies. Anyway, I think special economic zones could be cool. I might work on that at some point.

I love the idea of just lowering the barrier of entry to innovation and entrepreneurship. Brian, this was awesome, man. Thanks for taking the time to do it.

Thank you. I appreciate it.