Crypto Market Outlook, Family Office Strategy, and the ETF vs. Self-Custody Debate — Jake Claver

[00:00:00] Speaker 1: Any final thoughts before we end today's interview, anything that we didn't cover that you want our [00:00:04] Jake Claver: listeners to know about? I'm going to be a little controversial on Bitcoin real quick. Okay, go for it. Two years ago, I met a gentleman. He ran a large Bitcoin mining firm. And again, I love Bitcoin. We have a lot of clients that hold significant amounts of Bitcoin, and I do think that it will do well over the long term to be around. And so I was talking to him, and he provides, he had a company that provided a lot of the infrastructure to build out the mining farms. He recently just moved into a new position. I won't say what happened specifically, but he had 100 megawatt Bitcoin mining farm in Oklahoma. And he had acquired that for a large amount of money, but nothing crazy, about $25 million. And he's now changing that over to AI compute for a large corporation and has a 15-year contract that's worth about $300 million. I think that if you wanted to incentivize people to build global decentralized compute for an AI, Bitcoin mining was a fantastic way to do that. [00:01:03] Speaker 1: Hey, everyone. Welcome back to another episode of Deep Dive Podcast. I'm your host, Rachel Wolfson. I've got a great interview lined up for you today. I am speaking with Jake Claver. He is the chairman and founder of Digital Ascension Group, and he's actually a repeat guest. So super excited to have Jake back on the show. In this episode, we talk all about investments. We talk about how to custody your crypto, what Digital Ascension Group does. If we talk about the crypto market and what we're seeing today, we also mentioned the SpaceX IPO. So this is a great episode if you're interested in learning more about investing in digital assets. Obviously, this is not investment advice, but it is a great episode for those that are crypto curious or already in the crypto sector and want to learn more. Before getting started, I also want to take the time to remind you guys to smash that like button, hit subscribe, especially if you enjoy the content that you're seeing today. I've got a ton more of that coming your way, so be sure to stay in touch. Without further ado, let's get started with today's interview. Hey, Jake, how's it going? I am doing so well. I'm so happy that we are in person again doing another interview in one of my [00:02:13] Jake Claver: favorite cities, Dallas, Texas. It's great. I've been here my whole life. I wouldn't change it for [00:02:18] Speaker 1: anything. Yeah, and I grew up here, so it's always fun to be back in Dallas. You know, a lot of good [00:02:24] Jake Claver: views. We got one in the background today at the nice place that we're at. Yeah, I know. Well, I'm [00:02:29] Speaker 1: really excited to chat with you again because I saw you speak a few days ago at the Crypto Convergence Conference in Dallas, and you had a lot of really interesting insights. So I hope that you get to share that with our listeners on today's episode. For sure. Controversial. Controversial for people in the industry. Yes, for sure. But that's good. Jake, before we get started with the questions, can you tell our listeners a little bit about yourself, your background, and what you do? Sure. So, Jake [00:02:57] Jake Claver: Claver, I am the chairman of Digital Ascension Group. We are a multifamily office specializing in digital assets. So you would think of us as, what I tell my clients is we create a Schwab account for your digital assets. But we also structure the estate planning. We do the taxes. We have a bunch of partnerships that allow us to be able to create a full end-to-end spectrum of private client services for those that are crypto-affluent. Right. And so, and the name of the company is [00:03:23] Speaker 1: Digital Ascension Group, right? Yes, ma'am. Correct. Okay. And so, let's talk a little bit about what we are seeing in the crypto market today and how you're kind of advising and working with clients. I mean, things have changed a lot since we spoke last. [00:03:40] Jake Claver: Very different environment. Yeah. So, I'm actually not an advisor. We have advisors that we employ, and I'll give my disclaimer. So, nothing here is financial advice, only for entertainment and educational purposes. You should always speak with the financial advisor before making any investment decisions. And the opinions, my opinions, they are not the opinions of Digital Ascension Group or any of its subsidiaries. So, the way that we see the market today, you know, down significantly during the bear market here. And a lot of our clients, just as in traditional wealth management, have been a little concerned with the volatility. But a lot of people kind of know what they're getting into with crypto. These are long-term positions that they intend to hold for extended periods of time. Those that are speculating or gambling or day trading tend to weed themselves out. The majority of our clients have high conviction on the assets that they're holding, and they anticipate holding those for, you know, multiple generations. And they're looking for ways to be able to hedge risk and generate cash flow. And then also provide additional ways to access liquidity for their digital assets. So, can you margin them? Can you borrow against them? Can we work with a prime broker to be able to take that liquidity and put it in other things? What structured products can we create around it? How do we, you know, hedge to the downside or generate some premium or cash flow off of options or spreads that, you know, our advisors will work with our clients on? A little bit more sophisticated than your traditional investor in crypto. So, a lot of our clients are high net worths, family offices, other RIAs. We now consult for them as well. And so, just depends on their position in the market and their outlook. And then we try to provide guidance around that. We'll also do financial planning. So, as people have certain things on the horizon, maybe they have a child's college coming up or they want to retire. We help walk them through how to navigate the cash flows, forecast those things based on different market action, and then put together plans to make sure that they're, you know, in place to be able to handle any situation as it transpires. [00:05:53] Speaker 1: Mm-hmm. Now, is Digital Ascension Group only focused on crypto assets? [00:06:00] Jake Claver: We have a small portfolio that we manage of traditional assets. I think we're at around 30 million today out of the billion that we manage. So, it doesn't make up a significant portion of what we manage. We focus on crypto primarily, but we have some clients that want a holistic view. And so, they'll bring their traditional assets over as well. But for 97% of what we manage, it's all digital assets. [00:06:24] Speaker 1: Okay. Now, with the current market as it is today, you know, Bitcoin is down. So, are you seeing clients kind of shift away from digital assets and more into like traditional stocks and bonds? [00:06:39] Jake Claver: And the OGs in crypto, we've had many of them that we've had discussions with over the past year that are looking to exit their positions in some way that allows them to mitigate taxes and then position themselves in AI. That is the hot topic of the day. And so, you've got the SpaceX IPO that's just occurred today. And many of them have not necessarily de-risked, but diversified their position to some significant extent depending on who they are and how long they've been in. So, I would say, yeah, there's definitely been some people that have taken some chips off the table here recently with the institutional adoption here in the near future. They share some of the same beliefs around me that there's going to be a consolidation of the asset class and there's going to be, you know, a few that do exceptionally well. And then, you know, the meme coins and some of the other things that are out there may not quite perform as well as they have in the past during other cycles. [00:07:36] Speaker 1: Yeah, for sure. I mean, I, and I've never been into meme coins and, you know, I'm actually happy about that. [00:07:44] Jake Claver: We are too, you know, that has never been our, or my investment thesis in particular. I've been more focused on how these networks and protocols are going to be used in the real world and ones that have real utility. But yeah, to each their own, you know. If you enjoy a little bit of speculation, you've got prediction markets, you have all kinds of things today that you can bet on instead of, [00:08:08] Speaker 1: you know, looking for long-term outcomes. Right. Now, you mentioned the SpaceX IPO, which happened today. Today is June 12th, Friday, 2026. How has that impacted the crypto market? [00:08:22] Jake Claver: We saw the market up a little bit today. I think it'll be the actual use of that company that makes the biggest impact on crypto. So the satellites that they're putting into space, I think could act as nodes or broader network infrastructure for some of these digital assets, data centers in space. And then you have commerce that's going to be much, much faster than it is today. With, with rockets being a sustainable way to move cargo, they'll be able to go from Dallas to Japan in less than an hour, if you go up and around. And it can carry a lot more cargo than a ship can on the ocean that's going to take three months to get there. So they'll be able to charge a pretty significant premium for that. But to have all of that on blockchain and be able to authenticate all those things and see that real time, the efficiencies that that's going to create, I wouldn't doubt that Elon will be implementing those things inside the corporation as he continues [00:09:19] Speaker 1: to scale. So, I mean, I think it, and as you mentioned, the crypto market was up for a little bit today. I think that this is good for crypto. I think it's good for the crypto market. And so we'll [00:09:28] Jake Claver: just have to wait and see what unfolds. You know, Elon's been in positions where he comes out and does things at tops of markets. I don't know that this is the top of equities. There are many other analysts like David Hunter that believe we're going to 95,000 on the S&P or 9,500 on the S&P, excuse me. So I think, you know, he came out on Saturday Night Live in 2021, and that was pretty much the top of the market. We also saw Coinbase IPO at the top of the market in 2021. I think that there could be something to that with the SpaceX IPO happening today. You know, again, it's yet to be seen. We're just on the eve of that happening. So we'll see how it plays out over the next few weeks. But that could be a [00:10:11] Speaker 1: calling card that equities are topping here. So Jake, during the crypto convergence event, you mentioned on a panel that you only have to get rich once. And that that really stuck with me, because I think there's a mindset, especially in the crypto market where you don't, you know, you want to get rich multiple times. Explain that and explain how that fits into your business. [00:10:37] Jake Claver: So actually, I actually just put on a whole webinar prior to this podcast. A lot of people, and I'll tell the story that I told on stage there for those that are watching this. There was a gentleman that I got to meet for a short period of time. I went to an NFT conference in 2021 when NFTs were all the rage. And he was a Ethereum billionaire. He had been early in Bitcoin, and he went all in on the Ethereum ICO. And I won't talk about why, but he went to prison for five years. And when he got out, the cold wallet that he had all that Ethereum on was still on top of his closet. And he was a billionaire. And you would think that would be enough, right? But a lot of people that are in crypto, they've made their wealth by taking risks. And so it's hard to shift that paradigm from I've created wealth and now I need to be a steward away from continuing to double down and leverage yourself. He did not do that. He continued to leverage himself. He took all of that Ethereum, leveraged it in Aave, borrowed USDT against it, levered that USDT in Aave, doubled down again, and then took all of that out and put it in UST with Luna. So he had almost $3 billion printing 20% over there. And I don't know what happened to him when all of that collapsed, but I can only imagine that it was difficult to get all of that out of there and unwind all of that leverage while that was taking place. So maybe he was part of the group that took their stuff out. I don't know. But my point with that is you don't want to continue to leverage yourself and take additional risk. Elon is an anomaly. You know, he rolled everything that he made on PayPal, on SpaceX and Tesla, and that's worked out for him. But there have been multiple points when he was sued by the SEC or on the verge of bankruptcy that either one of those could have gone very wrong. And he's very smart and he's very much an outlier. I think people that achieve a certain amount of wealth, if you have over a hundred million dollars, a lot of people will structure a family office. They start to diversify and they have a portfolio that's across, you know, multiple allocations and multiple sectors to be able to hedge risk and have uncorrelated investments. So that if one doesn't do well, another one performs and they're able to maintain their wealth over a long period of time versus continue to take siloed risk and big bets on things. So as people accumulate wealth in crypto, I think it would behoove them to think about that. How am I going to structure this? How do I mitigate risk? How do I, you know, pass this on to my children and the next generation? And a lot of our clients, it is their money. They have made the money. They took the bet. But I encourage people to look at it through the lens of this is our family's money and I'm now a steward of this family's money. And when you're operating with somebody else's money, you tend to be a little bit more conservative in what bets you take rather than if it's your own. [00:13:36] Speaker 1: Right. I mean, it's interesting because crypto is considered, well, to some people, a high risk asset. Not to myself because I'm a crypto native. [00:13:49] Jake Claver: Right. You understand it. [00:13:50] Speaker 1: Right. I understand it. But with what you're doing and you're helping high net worth individuals get into crypto, but not take these crazy risks and maybe only get rich once. How do you explain that to people when most of the people in the world think crypto is a high risk asset to begin with? [00:14:10] Jake Claver: I would actually tend to agree with them at the current time. I think that almost all of crypto is speculation at this point. Now, I think we're 2000, maybe a little bit after 2000 on crypto. We've already seen a significant crash. It's becoming institutionalized. We're starting to get regulations around digital assets. And then there'll be a framework for things to be able to move forward. And again, I think there's going to be a significant consolidation. How many internet companies were there in 2000? Anybody put a dot com after their name and they were printing money and IPO-ing and doing all these things. So I think that that's where we're at. And as we see these networks be adopted, there are going to be significant winners and there will be people that come into large sums of money. And my hope is when that happens, I think the market dynamics are going to shift substantially and it'll actually help people navigate that on the other side of it. But I know that there's gonna be a lot of people that end up like a lottery winner. Most lottery winners have never had financial education. They don't have the resources to manage that wealth and 70% of them go bankrupt within three to five years. And we've already seen that with crypto as well. People will round trip it. They have significant gains. It's life-changing money and they leave it on the table. They don't take the profits. Um, because they're one, they may be scared, but two, they, they believe that it, the asset is going to continue to go up forever. There's not really anything that goes up for forever. So yeah, we just help people kind of understand those risks associated with it. We provide advisory. Our clients still have the last say in what they're going to do, but our advisors will share thoughts with them and put together pro formas. And like I said, do the financial planning to help them navigate it. And hopefully they take some of that advice and make good choices to maintain that past the, you know, liquidity event that they have. [00:16:15] Speaker 1: Right. Um, now Jake, I know, or at least you've been bullish on XRP. [00:16:22] Jake Claver: Still am. [00:16:23] Speaker 1: Okay. I was going to say, is that still the case? Because you know, I'm a Bitcoiner and I consider you as an XRP guy. So let's talk a little bit about XRP and why you're bullish on, on XRP. [00:16:34] Jake Claver: So they've stayed away from smart contracts for a long time. And the reason being is they want high throughput on the network. Uh, we've seen, you know, some of the other networks like Ethereum, it's smart contract driven, but the latency and cost to move transactions when it's there's, there's high amounts of volume on the network, it gets bogged down. And that's why we've seen a lot of layer twos on Ethereum. And so they're just now getting to the round to implementing smart contracts directly native on the L1 for the XRP. And there's also some side chains that have that capability as well. So you're kind of getting the best of both worlds. Um, they're being very methodical in what they're rolling out on the native network to be able to not impair its ability to settle quickly and very cheaply like it does. And, and I think the institutions prefer that. And that's why I think we're going to see institutional adoption for that network. They've been very careful to build things in that the institutions want digital identity, uh, XLS 40. They pass that through, uh, they had credentials. So that means if you're a credit investor or QP, or you have some other certifications that allow you to participate in certain environments, uh, you'd have those credentials to be able to then do that. They have permission domains and permission decks, which are those permissioned environments that review those credentials and make sure that only the parties that have those are able to participate in those ecosystems. And now they're rolling out, um, liquidity pools and borrow, lend, and those will all still be on the native layer one network without impacting its ability to settle. And, and I think the side chains payment channels, and I think there will also be an implicit or explicit subnet that they launch that will allow it to scale significantly more than 1500 TPS that it currently does today. If you look at MasterCard and Visa, they just recently when MasterCard got their bit license in New York, they've launched the pilot with Ondo and a few others, including Ripple, uh, to, you know, scale agentic payments on chain. That's another piece of me being bullish on the XRPL is we just had the first ever agentic payment, um, done on chain yesterday on the XRPL. Ripple made a early investment in T54.AI. Oh yeah. I know T he's been on. Oh really? Yes. T54 blanking on his name, but he has been on the show. Oh, beautiful. So they, they created a standard basically that allows for, uh, identity associated with agents and you can see the beneficial owner and you can give it. Yeah. Yeah. Yeah. So it'll be really interesting. Know your agent instead of know your customer or know your business. Um, it's a whole new thing that you have to have, but the institutions are going to want that. Right. Right. And so, because they've been very careful to methodically roll these things out so that it didn't impact the core thesis to the network and then also build in the compliance components. Uh, I think that you're, you know, potentially months away from seeing significant adoption of that network and the total amount of real world assets that have been tokenized on the XRPL has had the highest growth over the last year versus any other chain. Right. And the RLUSD [00:19:43] Speaker 1: stable coin, which I think is so fascinating. I spoke with Jack McDonald in Miami during consensus about RLUSD. And he even mentioned how that, you know, people using RLUSD impacts, um, XRP and XRP [00:19:57] Jake Claver: ledger in a positive way. Yes. Yeah. A lot of people have the misconception that stable coins are the end all be all. You still need a bridge asset to be able to settle that at scale. Uh, otherwise you just exacerbate the Nostro Bostro problem that we currently have. There's 27 trillion dollars locked up globally. And if everybody has their own stable coin, now you've got to park capital at all these other intermediary banks to be able to settle your stable coin and then them swap to their own. And you might think, okay, well, why wouldn't they just accept that other stable coin? Banks don't want to hold other people's stable coin. They want to hold their own because they're incentivized to do so with the treasuries that have to underpin them and they want to be earning the interest off of that. So they would prefer it if, you know, if you sent city stable coin to Bank of America, Bank of America would like to receive that in BOA coin. And you need a DEX [00:20:47] Speaker 1: or intermediary bridge to do that. Right. Definitely. Now, Jake, you're bullish on XRP. You obviously just explained why. So when clients are seeking, um, crypto advice, maybe from the advisors with your business, are you, um, are you pushing XRP to them or are you just kind of letting them know what each digital asset kind of does and the value and the benefits? So again, I'm not an advisor. Right. Uh, and our advisors [00:21:20] Jake Claver: would have very different opinions than myself. Okay. Uh, they are fiduciaries. And so they're looking at risk associated across the board. Oftentimes when you're talking to one of our advisors, they're going to give you a much more balanced view than I would. I talk a lot about my portfolio and what I'm doing. Um, people may misconstrue that with the values of the corporation. Um, but you know, they are also looking at the same market indicators that I am. And they believe that there is going to be some level of appreciation, some more than others. And everybody's entitled to their own opinion. Right. Uh, and as a fiduciary, I think it would be a responsible of them to push a specific investment on clients. Oftentimes our clients come to us with crypto. So they already have a conviction on whatever they've invested in. They're just looking for someplace to steward that and access to other financial products and opportunities to be able to, again, access liquidity, generate returns, or use that in some way to benefit them outside of just the appreciation over the long term. In terms of [00:22:21] Speaker 1: concerns, what are the biggest concerns that clients are expressing to the financial advisors? Really, it's [00:22:29] Jake Claver: custody. Okay. Um, and you and I had a little conversation about this earlier, but you know, holding your assets on a cold wallet or on an exchange, there's a lot of risks that come along with that. And so that's the main value proposition that we bring to a lot of our clients is peace of mind and holding their assets somewhere that's segregated bankruptcy, remote insured, and in their name. Uh, it's not owned by the financial institution or somebody else. And so that's one of the main things. And then, you know, if they are participating in DeFi, they want to understand the risks around that, what portion of their portfolio they should be risking, where on the risk curve, each one of these different opportunities lies. And again, how to position themselves or their assets in the market that's going to benefit them in the long term outcomes that they're looking for. [00:23:18] Speaker 1: Mm-hmm. Right. Um, just out of curiosity, how did you get involved with all of this? Was it, you know, were you interested in finance and digital assets early on or, you know? [00:23:31] Jake Claver: You know, I didn't actually even cut my teeth in crypto until 20 and 21. Oh, okay. Um, I wish I had been in sooner. I would probably be more of a Bitcoin bull. Okay. If, if I had been in sooner to be honest with you, because I think there's some, if you've had success with a certain asset, you want it to continue to do well. Right. And same thing. I've had success with XRP and a few other things that I think will continue to do well. So take it with a grain of salt, those that are watching. Um, but originally I went to school for finance, didn't use it. Uh, had a short internship at Northwestern mutual and I hated it. I felt like a snake oil salesman. They wanted me to sell life insurance to my friends and family and really didn't pay me much. And I thought, oh, this is horrible. If this is the whole industry and, and being young and naive, I thought that it was. And so I went on my way and worked in industrial sales for a long time, did well there, scaled multiple locations for a fortune 500 company. And, um, eventually, you know, made my rounds and I was working in M and a, uh, working with small business owners and blue collar, uh, workers to help them scale and exit their business. And I finally had enough money to do some investing. Uh, and the reason was I was saving for a home for my wife and I, which we're just now getting around buying six years later. Thank you. Appreciate that. She's happy about it too. Believe me, I've had to hear about it the whole time. So anyway, the money that I had saved when the market fell in 20, I'd watched my dad miss out on American airlines when it was pennies, uh, before they got bailed out by the U S government in 08. And he pulled me into the office when I was 16 and he said, uh, Hey, I want to show you something. I want to talk to you. And I said, okay. You know, he didn't really talk to me about money a whole lot. His whole philosophy was just invest in the S and P 500 and you'll outperform almost everything, which is still true today for the most part. Uh, but he had pulled his money out of the market and everything was falling apart. And he, he said, I think they're going to bail out American airlines. Uh, and I want to put everything I've got in it, but if they don't pull them out and they file bankruptcy, I lose everything. And we had just moved and bought a house and he had all these responsibilities. And, uh, I didn't understand any of that. I was 16 years old. So I thought I told him, I'm like, just roll it. If you, if you think that that's the thing, and you know, you have conviction on it to do it. And he was like, you know, I just, he was very much about survival and making sure that we were good, which I really do appreciate. It allowed me a foundation to do other things in my life. Uh, but I wish he had taken the chance, even with a small portion of it, because it would have changed the outcome for his retirement substantially. And so when I had the opportunity in 20 and during COVID and everything happened, uh, I took everything that I had and went into the market. I'd stayed out of the market just because, you know, PE ratio and Buffett indicator, and a lot of the things I'd learned in school told me that the market was overvalued. And so I was like, all right, well, there's going to be a pullback at some point. And that's when I'm going to try to jump in. And I did get into Facebook, Amazon, Google, Tesla. I thought, okay, these are blue chips. I can, I'm a little diversified. I don't know how it's going to work out, but I think these will do well. And they all did. And I went to go de-risk after I doubled my money in the stock market. And I was looking at gold and real estate and watching a bunch of Peter Schiff and Andy Sheckman. And I watched Peter debate, a Bitcoin guy. I don't even remember the gentleman's name, but he explained it very well. And I was like, oh, this is the next like iteration of the internet. This is how value is going to move. I understand why everybody was crazy about Bitcoin in 2017. So I took everything I made in stocks, rolled it all in on crypto, took 13 positions. I don't think I'm smarter than anybody else. I think I just got lucky on the timing and came into a position where I had never been before. Nobody in my family had ever had that much money before. And so that's when I started seeking out all these professionals. And I called all across the country, trying to find somebody that could help me, called over a hundred different firms in different categories, you know, CPAs, accountants, tax attorneys, wealth managers. And I whittled it down to the five people that helped me with my stuff. And then in 22, I got on Twitter and started talking about some of the things that I had done and how I'd structured my estate and mitigated taxes. And a few people were nice enough to make some intros to some family offices. So I started consulting for them. And over the last three years, we've built out a full service end to end, you know, multifamily office to be able to provide that to, you know, really anybody in crypto, because I solve my own problems. So a lot of what we built has been very selfish, but I want to make sure that other people [00:27:57] Speaker 1: don't have those same frictions that I did. Right, right. And you mentioned Bitcoin and gold. And that was actually a question I wanted to ask you. Do you consider Bitcoin still to be digital gold? I [00:28:08] Jake Claver: mean, it's gone down. That's, you know, if you had asked me that a year ago, I probably would have said yes. Okay. But with the inflation that we've continued to see in the economy and its performance, while gold has continued to go up, it does not look as though it's correlated or works in the same way. Now, it's still the best performing asset over the last decade. Next, the second best, you know what the second best best performing asset is? Pokemon cards. Really? Yeah. Oh. That's real. Interesting. So, you know, like I said, a year ago, I would have said yes. Today, with the way that it's performed, we've seen stocks rally, and it's also been pretty correlated to stocks in the past. As M2 money supplies continue to grow, Bitcoin has done very well. I think the position that we're in, you know, Michael Saylor talked about this the other day. He believes that a lot of people are taking liquidity from other locations and dumping it into AI because they're raising billions and billions of dollars. And like I mentioned earlier, I know multiple early whales that have done exactly that. So I think his thesis on that may be accurate. Yeah. I don't know that it holds up there. It was originally supposed to be peer-to-peer, you know, transactions. And after they didn't increase the block size in 2014 and they split the network to Bitcoin Cash and Bitcoin, it really didn't hold up that value proposition either. And I don't think it was Bitcoin's fault. I think it was the VCs that got involved with Bitcoin that bought all the miners that ended up causing that issue. But yeah, I don't know where it fits right now. I'm hopeful that we see the price appreciation go to a million, like many other people would want to see. But I'm kind of a sailor. You know, I think it's either zero or a million. And we're just yet to see the outcome. [00:30:04] Speaker 1: Right. I know. It's an interesting sector that we're in, you know, with Bitcoin. So, Jake, let's shift gears a little bit. Let's talk about ETFs versus cold storage solutions or even Digital Ascension Group. What are your thoughts on ETFs? [00:30:22] Jake Claver: So right now we have primarily spot ETFs for crypto. I do think in the not too distant future, we're going to see diversified ETFs come onto the market. So it'd be a basket of crypto that you'll be able to allocate to one ETF. And I think all the large issuers are gearing up for this. You have to, I think it may even be a basket of the underlying ETFs. So we went and we looked at structuring an ETF late last year for another reason outside of crypto. And going through that process was very enlightening. If you do a basket of other ETFs, it's a lot more likely to get approved than a brand new ETF on a different product. So you could take, you know, the Bitcoin ETF, the Solana ETF, the Ethereum ETF, the XRP ETF, Doge, you have HBAR, there's a few others as well. And you could bucket those in another ETF that was allocating to those ETFs. And I think that's likely the track that will happen. But then you have fees on fees, right? So as you create these larger financial products and derivatives, there's more middlemen, there's more fees associated with that. You do get institutional custody, you don't have to worry about how to hold the asset or where it's held, you know, it's held at Coinbase or Anchorage or one of the larger custodians at this point, which is great. There's a lot of assurances built into that and insurance as well. So I think it's, you know, depending on what type of investor you are, if you're in equities, this is a great way to be able to get it gain exposure to this asset class through these structured products. But if you're a crypto OG, and you're okay with managing your crypto, and you understand that owning the underlying asset also might provide you different avenues to generate income, maybe a greater ability to borrow against it. There's many reasons that I could argue that you might want to hold, you know, the bearer asset versus an ETF, the same way people might argue, you know, a gold ETF or physical gold, right? We kind of look at it the same way. Although, you know, digital assets, you don't have the overhead of vaulting it and all the other things. But there is radical responsibility that if somebody breaks into your home and takes your wallet or your keys. So we kind of sit somewhere in the middle. And that's, that's where I like to be. You kind of get the best of both worlds. The assets are still in your name, you still get all the assurances that you would from an ETF. And you've mitigated all the risks that you would from having your own exchange or [00:32:39] Speaker 1: a cold wallet. Now, you mentioned earlier about something new that is going to start with Digital Ascension Group with an ETF, right? Well, so a lot of the advisors out there, we were just at that [00:32:53] Jake Claver: conference that you spoke about. And the main way that they are getting their clients exposure to digital assets is through ETFs. Okay. And so they'll advise people to allocate a portion of their portfolio to the Bitcoin ETFs or Ethereum, maybe they have diversified exposure there, or they're in a fund vehicle that does some algorithmic trading strategies or other things to be able to generate additional returns. So there's, you know, a couple different ways you can get exposure to crypto, you could do the bearer asset, you could do inside of a fund, or you could do ETFs. What we're doing for advisors is we come in as a sub-advisory. And if their clients do want exposure to crypto, we manage all of that underlying crypto inside of models that we've created, very similar to a diversified ETF. We rebalance a little bit better. And then we can also do things with those digital assets that you cannot do inside of an ETF. They're very strictly regulated on how you can margin those assets and what things that you can participate in. They always have to have a one-to-one backing. So I would say our models are maybe a little bit further up the risk curve than an ETF, but there's a lot of additional benefit for that little bit of extra risk that you're taking. And again, this is at the advisor's discretion on how they want to participate. They may not want all of the additional leverage and strategies to be able to generate additional returns. They may just want a diversified basket of cryptos that their clients are going to be allocated to. And so we have three different models that we've brought to market that the advisors that come into our sub-advisory are going to have access to. And then it's a really clean way for them to be able to provide financial advice on digital assets to their clients and bring that into their holistic portfolio with the rest of their traditional assets they manage as well. [00:34:44] Speaker 1: So those models are already being implemented today? Okay. So Jake, what do you think or what do you think that we can expect to see with the crypto market in the next few months? [00:34:55] Jake Claver: Oh man. I'm hopeful that we get the Clarity Act across the line. I'm not optimistic on that. I think we're 95% that that's not going to happen. Again, I would love to be wrong. I'm hopeful that that happens, but I don't think we need it for large scale adoption of a lot of these assets. We have the SEC and the CFTC coming out with joint guidance on which ones are commodities and which ones might still be securities. We're waiting on the OCC to regulate stable coins off of the Genius Act. As soon as they give that, they've just gone through both of their comment periods. May 1st was the end of that for the public and then June 2nd was the end of that for the FDIC and the Treasury and FinCEN all gave their comments back. So between now and July 18th, we should see guidance from the OCC on stable coins and how those yields are going to work. And I think that's the missing link. We need that to be in place to continue to drive demand for treasuries here in the U.S. And I think you're going to see a lot of liquidity move on chain once the banks have full understanding of how they're going to be regulated and what that's going to look like because the OCC is the regulator. So I don't know that we actually need the Clarity Act itself passed. It would provide a lot of benefit around DeFi because if the banks and institutions understood what was needed for compliance and regulations around those environments, I think that they might be a lot more accepting to start implementing those things inside of a financial infrastructure that they wield. But that's really the only thing outstanding on the Clarity Act that I think is going to cause any truncated adoption in the short term. But over the next couple months here, I do expect to see significant amounts of liquidity move into digital assets. And a lot of these protocols [00:36:47] Speaker 1: start to be used in a much larger capacity. And are you still seeing a need and are you still seeing a demand rather for digital ascension group or for people coming in and wanting to get involved with digital assets even though the market is down right now? We've maintained our level. So we had about a [00:37:08] Jake Claver: billion in AUM last year in October and we've treaded water there. As the markets continue to come down, we've had more and more people come on and bring their assets into institutional custody. I think at that point last year, we had maybe 3,500 clients and now we're a little over 5,000 total clients. Got it. So continuing to, you know, provide the services, a lot of people still need them. It's not like it's any less. It's just a smaller value in their portfolio, but they still want the assurances that we provide. And if it's a lesser value, you're not paying as much on the fees, right? So that's some of people's apprehension to work with us is the cost to do so, but what is peace of mind worth? And we also provide additional ways to be able to cover those costs through the products and services that we've built out. We're really on the cutting edge of building all of these products in the market in a regulated way as an SEC registered RIA. Right. Definitely. And Jake, for our listeners that [00:38:06] Speaker 1: might want to know more or connect with you, you host, don't you do a podcast or you do something weekly? Yeah. [00:38:12] Jake Claver: So there's, there's a bunch of different things that we do, but Monday and Wednesday nights, I'm on X, Facebook, YouTube, and TikTok. And I take two hours out between 9:00 and 11:00 PM central and just answer people's questions. Wow. Whatever they put on there, whether it's around estate planning or the market, you know, other assets outside of crypto, personal things, you know, I try to be pretty receptive to all of that. And I, again, just give my opinions. It's wild to me how many people care what I think. I never thought that I would be in a position where so many people would put value in the words that I speak. So if you want to learn more, you can go check that out. We also have, we're consolidating, we're rebranding right now, which will be great when we're done with that. I will announce the name, I will tell you, but as it sits today, you know, the websites are digitalfamilyoffice.io for all the family office services and complex estate planning. Wealth management is digitalwealthpartners.net. And then we do have a mastermind group of about 17,000 people that are crypto curious or have a significant allocation. They want financial education, business resources, and access to private deals that we put in there. And that's at beyondbroke.com. [00:39:31] Speaker 1: Mm-hmm. Great. Wonderful. Any final thoughts before we end today's interview? Anything that we didn't cover that you want our listeners to know about? [00:39:40] Jake Claver: I'm going to be a little controversial on Bitcoin real quick. [00:39:43] Speaker 1: Okay. Go for it. [00:39:45] Jake Claver: So two years ago, I met a gentleman. He ran a large Bitcoin mining firm. And again, I love Bitcoin. We have a lot of clients that hold significant amounts of Bitcoin. And I do think that it will do well over the long term and be around. And so I was talking to him and he provides, or he had a company that provided a lot of the infrastructure to build out the mining farms. He recently just moved into a new position. I won't say what happened specifically, but he had a hundred megawatt Bitcoin mining farm in Oklahoma. And he had acquired that for a large amount of money, but nothing crazy, about $25 million. And he's now changing that over to AI compute for a large corporation. And has a 15-year contract that's worth about $300 million. I think that if you wanted to incentivize people to build global decentralized compute for an AI, Bitcoin mining was a fantastic way to do that. And over the next couple years, I would anticipate that you're going to see a lot of large Bitcoin miners and even small Bitcoin miners rehypothecate their infrastructure toward AI compute that will actually be a little bit more lucrative than what they're making on Bitcoin at this point because of the cost of energy and the halving [00:41:06] Speaker 1: that's coming up as well. What's that going to do to Bitcoin? How is that going to impact Bitcoin? [00:41:12] Jake Claver: You know, it could go a bunch of different ways. I'm hopeful that there will still be enough incentive for people to verify transactions on the network and it will continue to scale and be around. But I think there could be a consolidation of the miners. If you had, you know, a lot of people changing direction and that infrastructure that was used for that, it would shrink the ecosystem of people participating on the blockchain. So I don't know, is the real answer. I just, I see it as a trend. And after talking to him and I told him that I thought that that's the way that it would go two years ago. And he said at the time, no, that that'll never happen. And now he's one of the people that's doing it. So, um, just for people that might have Bitcoin mining out there might be something worth [00:41:56] Speaker 1: looking at is, you know, uh, it's a good paycheck. Yeah. I mean, look, I agree with you. Um, we, I spoke with, uh, BitZero and Kevin O'Leary, Moe of BitZero. And Kevin mentioned how he's very bullish on power and AI compute. BitZero started with Bitcoin mining, not in the U S and they're publicly traded in Canada, but anyways, the stock, but now they're focused on AI compute and shifting all of that over there. I mean, that's where a lot of this change is happening. So I agree with you, but it's a really good point that you bring up. And I'm glad that we're ending on this note because it kind of leaves you wondering, well, how's that going to impact Bitcoin and the price of Bitcoin? [00:42:41] Jake Claver: Because we are going to see that a hundred percent. If you're impacting the miners and they're having to choose between AI compute or continue to validate transactions on the network and they're going to go where the money is, uh, there needs to, I'm sure that they'll upgrade Bitcoin for quantum. There, there's a lot of risks around Bitcoin that I think will get solved. Um, but yeah, it'll just be interesting to see how it plays out over the next few years. Well, and it's also interesting to think [00:43:08] Speaker 1: Bitcoin mining centers, right? Those are as, as Moe from BitZero told me, those are tier one data, or tier zero, sorry, he said tier zero. They're, they're a lot less expensive to maintain and build an AI compute data centers. So it's interesting. A lot of these Bitcoin miners, if they do want to level up, they're going to need a lot more money to do it, right? I'm sure there'll be venture capital [00:43:32] Jake Claver: that comes in and is willing to deploy that money in order to be able to make those transitions. And to your point, you know, the ASICs are etched specifically to, you know, solve the algorithm on the Bitcoin blockchain. So there will have to be some change in the infrastructure and it does cost money to do that, but they're set up if they're right next to a substation and have water and like all the other things, there might be a cost of benefit there that play versus building new. [00:43:57] Speaker 1: Yeah, yeah, yeah, for sure. Well, Jake, it has been a wonderful conversation as always. So happy that you came on the show and I look forward to staying in touch and having you on a third time at some point when we see more interesting things with the market. Absolutely. Would love to be back. Thanks again for having me. Thank you, Jake. Special thanks to 4Labs Digital for producing Deep Dive Podcast. I'd also like to thank the sponsors behind Deep Dive. You can click the links in the show notes to learn more about each of the initiatives from these sponsors. Finally, thanks to the listeners for tuning in. Please be sure to subscribe, like, and share.