0:01

And one of the things that I will say

0:03

about companies that I've worked with in this industry

0:05

is there is so much love. There is so

0:07

much support. There is so

0:10

much really intent to do right by those

0:12

individuals and to figure out how to do

0:14

that within the context of the law and

0:16

the context of risk management. And

0:18

that has been so cathartic and so beautiful

0:20

for me to witness. You're

0:24

listening to Because of Bitcoin, a podcast

0:26

that shares the personal stories of how

0:28

Bitcoin is having a real impact in

0:30

people's lives, including mine. I'm

0:32

your host Mauricio Di Bartolomeo, the co-founder

0:34

and CSO of Let It. And without

0:36

further ado, let's get started with today's

0:38

story. Many

0:45

see Bitcoin as incompatible with modern

0:47

financial compliance programs. The

0:49

sheer idea of sharing your personal information

0:51

with a bank or financial service provider

0:54

is a cardinal sin for some hardcore

0:56

privacy proponents in the Bitcoin community. Yet

0:59

we need Bitcoin financial services to be compliant

1:01

with the existing banking system to allow people

1:03

to easily buy it and sell it. Building

1:06

a compliant service on top of Bitcoin

1:08

does not make Bitcoin any less revolutionary

1:11

of an asset. A great

1:13

example of this is the Bitcoin ETFs. While

1:16

it has undeniably opened access for a

1:18

new type of investor to buy Bitcoin,

1:20

it has not detracted away from Bitcoin's

1:22

features or capabilities in any way whatsoever.

1:25

It is a net benefit to the Bitcoin

1:27

ecosystem. In the most general

1:29

sense, compliance is about abiding by a general

1:32

set of rules that will ensure a basic

1:34

level of service. This

1:36

ensures that whoever is overseeing the activity

1:38

can later enforce the rules if they

1:40

catch any wrongdoing. If

1:42

you want to have the protection of the host government, you

1:45

need to comply with their requirements. An

1:48

interesting example of the complex relationship

1:50

between Bitcoin and compliance is how

1:52

some champions of decentralization rung to

1:54

the authorities to report a hack

1:57

or exploit seeking their help. or

2:00

how many people impacted by crypto

2:02

scams claiming to be decentralized seek

2:04

the protection of the US courts

2:06

when they incurred losses. In

2:09

order for Bitcoin and digital assets to keep

2:11

eating the system, we're going to

2:13

have to continue building compliant financial services

2:15

that bridge the gap between the new

2:18

world and the legacy system. Latin

2:20

and Coinbase are two good examples of this.

2:23

No one owes compliance better than my

2:25

friend and compliance expert Amber Scott. She

2:28

is the founder of Outlier Solutions

2:30

Inc. and a certified anti-money laundering

2:32

specialist with a wealth of expertise

2:34

in ethical and legal compliance. I

2:37

was incredibly inspired by her story

2:40

and blown away by her insights. I

2:42

know you'll love this chat just as much as I do. Amber,

2:48

so great to see you again. Long overdue

2:50

catch up. How are you? I'm

2:52

wonderful. It's always good to see you. And I love

2:54

the work that you're doing on the show. They've been

2:57

fascinating episodes to listen to, and it's a pleasure to

2:59

be here. Thank you so much. And

3:01

I'm really happy you're a part of this because your

3:03

story, as people will find out today, is

3:06

incredible. And it's one

3:08

more story of amazing Bitcoiners

3:11

and people doing work in Canada and

3:13

how Canada punches a bubbous weight in

3:16

this industry, which is overlooked many

3:18

times, but we'll shine the light on

3:20

this. So can you tell us a

3:22

little bit about what was life growing

3:24

up for young Amber? Difficult.

3:28

I grew up very poor in

3:30

Northern Ontario. And this

3:32

is a thing that I started

3:35

talking about primarily because

3:37

of someone that I worked with when

3:39

I was a banker who was absolutely

3:41

phenomenal, who at one point said to me,

3:44

Amber, you're different people at

3:46

different times, and you're going to hit a

3:48

ceiling as a leader unless you figure out

3:50

what your authentic voice is and how to

3:52

speak authentically. I really had to sit

3:54

down with that and realize that I had a lot of shame

3:57

and I had a lot of things that I never wanted to

3:59

discuss wanted to talk about. And

4:01

I think the first time I talked about the

4:03

intersection of poverty and

4:05

growing up poor and growing

4:07

up with a parent that was abusive and

4:10

would literally steal my money and

4:12

how that affected my interactions with

4:15

Bitcoin and how I thought about

4:17

Bitcoin and Bitcoin self-prestody as

4:19

being incredibly powerful. I

4:21

can't stress enough, I am okay. I am very

4:23

much at peace with the past is the past

4:26

and things happen. But at various

4:28

points in time for me growing up, I

4:30

had a biological parent, if

4:32

we got like birthday money, if we,

4:35

I started working outside the home baby sitting up.

4:37

So any money that I would earn, if it

4:39

was in cash, would just get confiscated when there

4:41

was whatever. So there was never

4:43

this real possession of money. The

4:45

first time that I opened a bank account,

4:48

that biological parent went to the bank, drained

4:50

the money. Eventually I was

4:52

in foster care and so I opened my own

4:54

bank account at a different bank and

4:56

they found out about it and found a way to go there and

4:58

drain the money. My first sort of

5:00

big girl job was at a restaurant and

5:03

I would deposit my restaurant check into the

5:05

bank and then it was just gone.

5:09

So I learned to go to the bank that

5:12

the restaurant banked with and just get cash, which

5:15

led to this biological parent that I'm no longer

5:17

living with at this point in time, going

5:20

to the restaurant and trying to get the

5:22

restaurant to give them my

5:24

check so that they could go

5:26

cash it. It was crazy and at every

5:28

turn, I'm a child. Like to preface this, at

5:30

this point in time, I am 14 years old,

5:33

I am 15 years old. I

5:35

don't have the social skills to deal with this. I

5:38

feel like I'm the customer and my

5:40

bank is supposed to be protecting me, but

5:43

that's not my experience. The

5:45

thing that I learned from that is really

5:47

that as crazy

5:50

as all of that sounds,

5:53

no matter what institutions promise you,

5:56

there's a possibility that institutions

5:58

can fail. And that

6:01

the more vulnerable you are, the

6:03

more important that it is that

6:05

you have financial self-defense. And

6:08

I think that comes from really understanding

6:10

how things work. So I

6:12

learned to ask questions about who can access this

6:14

account, who cannot. If I need someone

6:17

not to be able to access my account, what

6:19

does that do? And this has carried on into

6:21

my adult life. So I've had no contact with

6:23

that biological parent for years. But

6:27

still I deal

6:29

with legal agreements and make sure that

6:31

when I'm doing anything like a will

6:33

or a power of attorney, there's very

6:35

clear instruction that this person, if I

6:37

were to be deceased tomorrow, couldn't access

6:40

any of my accounts because I assume

6:42

they haven't changed. I

6:45

think some people have gone through that experience

6:47

with a government where we have this idea that

6:49

the government's supposed to protect us, they're supposed to

6:51

have our best interest at heart. And I think

6:53

that's a really similar experience to when

6:55

we're growing up. We think that a parent is supposed to

6:57

love us and protect us and have our best interest at

6:59

heart. And sometimes that's not

7:01

the case. And that's where it's important that

7:04

we build these self-sovereign skills. It's

7:06

such a direct story

7:09

that highlights the importance of self-custody

7:11

and having this concept that Bitcoin

7:13

allows you to be the custodian of

7:15

your own assets without having to ask for permission from

7:17

anybody. And what I always say about Bitcoin that I

7:19

love about it is that it gives you the options.

7:22

You are the master of your kingdom and you

7:25

can choose to go to an institution and have

7:27

it custody by someone else or access services, but

7:29

you don't have to. I think that's a very

7:31

powerful story. There's going to

7:33

be a lot of people that are going to

7:35

listen to this and become inspired and really understand

7:37

why this is so important. I

7:40

actually have seen a number of

7:42

situations where there has been

7:44

someone who is a youth that

7:47

has a parent that is abusive. And

7:49

these are ironic compliance consultancies. So these are

7:51

questions that I'll deal with from my clients

7:53

in the crypto industry where

7:55

the question becomes, we're

7:58

dealing with someone who's a... underage, they've

8:00

given us circumstances where there's

8:04

a transaction that is

8:06

not going to be done. There's no parental

8:08

consent. There's no identification of the parent or

8:11

guardian. And where do we go

8:13

with this? And how do we do this? And how

8:15

do we facilitate the transactions and manage the risk related

8:17

to that individual when that individual has

8:19

disclosed, for instance, that the parent is an addict

8:21

and they're the ones paying rent when

8:24

they've disclosed that there is financial abuse in

8:26

the home and they don't in any way

8:28

want to reveal that they have access to

8:30

these funds, but they're using them to do

8:32

the basics that you would expect the parent

8:34

to do by groceries or pay rent. They're

8:36

going and selling a little bit of Bitcoin

8:39

every now and again because then they suddenly

8:41

find the money for groceries and they're helping

8:43

to support their family and their siblings where

8:45

the parents have failed to do that. And

8:48

one of the things that I will say

8:50

about companies that I've worked with in this

8:52

industry is there is so much love, there

8:54

is so much support, there is

8:56

so much really intent to do right by

8:59

those individuals and to figure out how to

9:01

do that within the context of the law

9:03

and the context of risk management. And

9:06

that has been so cathartic and so beautiful

9:08

for me to witness. That is

9:10

a really great point you bring up, Amber.

9:12

And it's so great to hear from a

9:14

compliance professional. There's this wrong

9:16

idea that Bitcoin

9:18

or crypto facilitate bad things and they're

9:21

used by bad people to do bad

9:23

things. What I think gets missed often

9:25

is how many people are actually trying

9:28

to do good legitimately using

9:30

this technology to get to people that

9:32

you otherwise couldn't have before. And we

9:34

can do that. There's ways of doing

9:36

that. And that

9:38

gets sometimes overshadowed by

9:40

the people that just

9:42

have other types of interests and they want

9:45

to see other headlines. And so

9:47

the good gets lost many times with the bad.

9:49

And for you to highlight

9:51

how many companies are trying to do good

9:53

with a very concrete example on how Bitcoin

9:55

is helping potentially a young

9:57

person from keeping their financial dependence

10:00

them to help their family better than the powers

10:02

that be or the parents could themselves. I

10:04

cannot stress this enough. If you're a compliance geek

10:06

watching this and you're a leery, I get it.

10:09

When I first came into Bitcoin, all I knew at

10:11

that point, and it was like 2013, and I knew

10:14

about E-gold, and I knew about Liberty

10:16

Reserve, and the thirds and money laundering charges, and I

10:18

was just primed to think that it was very

10:20

sketchy. So left to my

10:22

own devices, I wouldn't have wanted anything to

10:25

do with it. But Peter Taylor was

10:27

doing payment processing at the time, and he called me

10:29

up, and he said, we're doing

10:31

payment processing for this Bitcoin exchange. It's turning into

10:33

a lot of our volume. I'd like some help

10:35

updating our risk assessment. And she is

10:39

brilliant. And I just adore him as a human being.

10:41

And I do have his permission to talk about that. And

10:44

the opportunity to

10:47

work with him overpowered the idea that I was like,

10:49

do I really want to do anything in this Bitcoin?

10:51

Well, I was like, yeah, I want to work on

10:53

it. So I asked him to pay a retainer in

10:55

Bitcoin, which

10:59

was ludicrous, but it was my company. I could

11:01

do that. And with most things, I mean, I've

11:03

been a banker, I've worked in securities, I've worked

11:06

in insurance, I'm using these other financial facilities all

11:08

the time, but I hadn't played with Bitcoin. So

11:10

I didn't know how it worked. And

11:12

he was like, yeah, we can do that. But you're gonna have

11:15

to set up a wallet, I'm going to send you some articles.

11:17

I cannot help you do that, because I cannot have access

11:19

to your private keys. You need to

11:22

understand how this works. I'm going to send you some

11:24

things. And I was like, okay, send me articles. And

11:26

then I didn't sleep Thursday night, I missed a

11:28

meeting Friday. So I was just going down the

11:31

rabbit hole, as they say, lots of

11:33

times getting really angry at the structure of it,

11:35

and thinking about all of the uses and the

11:37

possible malfeasance and the way that things could go

11:39

wrong and just being absolutely frustrated at the idea

11:41

of a $21 million cap and how weird and

11:44

arbitrary is that? And what is that actually doing?

11:46

And like how I have an

11:48

MBA, and this makes no sense to me. Monday,

11:50

Peter called me and he was like, do you feel like

11:53

you're ready to secure a wallet? And I was like, no,

11:55

dude, but I've said what happened. I'm thinking like, I want

11:57

to I want to play with it. I want to understand

11:59

it. Everybody always asks if I

12:01

kept that Bitcoin and I feel like that would have

12:03

been the wrong decision because I had to like play

12:05

with it. I had to tell somebody in exchange, I

12:07

had to buy something. I bought a tablet that promptly

12:10

got left on a plane, which is probably one of

12:12

the most expensive tablets in history in retrospect. But no,

12:14

I had to understand how it worked. And we as

12:16

a company kept taking payment in Bitcoin since then. From

12:19

what I know, I believe that your

12:21

interest around compliance came before your

12:23

interest around Bitcoin. So

12:26

I'm curious, can you explain a little bit about

12:28

how that journey was to get

12:30

you interested in compliance? What was your thinking at

12:32

the time and what did you think that could

12:34

lead to when you were older? So,

12:37

I mean, I tripped and fell into

12:39

compliance completely by accident. When

12:41

I finished my undergrad, I did an undergraduate degree in

12:43

psychology. I started out thinking I'd want to be a

12:45

clinician. I did some co-ops and

12:47

learned that there are wonderful people that

12:49

are full of empathy that cannot take that work home with

12:51

them. I am not one of them. I

12:54

was really a lot more interested in math

12:56

at that point. And so I

12:58

wanted to take a year or two off before doing grad

13:00

school and figure out what I wanted to do. And

13:03

I saw this post from Many Life and I thought,

13:05

that looks really interesting. And I had wonderful 20-year-old bravado

13:07

and thought, like, I have none of the hard skills

13:09

and all of the soft skills and I can just

13:11

learn the rest. And someone hired me.

13:13

I learned an awful lot. But I started there

13:15

in August of 2001. And

13:18

in September 11th happened. But

13:20

everything about the conversation in

13:23

anti-money laundering compliance and counter-terrorism

13:25

compliance changed completely and

13:28

really rapidly over the next few

13:30

years. And so it

13:33

was interesting and it

13:35

stayed interesting. And

13:37

I learned absolutely so much about

13:40

money and financial systems and the

13:42

way that different things worked

13:45

doing in-house compliance. I

13:47

think some of those early roles. So a big

13:49

part of that early role was that I did

13:51

dealer compliance. So people that are out giving financial

13:53

advice and selling products and this and that. And

13:56

one of the first really

13:59

big... type of half-client getting

14:01

mad at me conversations that I had as

14:03

a compliance person was that we would screen

14:05

people. And Manulife at that time had, as

14:07

it's bold, to be the most professional insurance

14:09

company in the world. And I think they

14:11

succeeded. I have nothing but great things to

14:13

say about Manulife. And they had

14:15

rules about who can be an advisor, right? And

14:18

this is going to seem like the lowest bar.

14:20

But part of that was that you can't be

14:22

out giving folks financial advice if you're bankrupt. There

14:25

were verifications of these things. So there would be

14:27

credit checks. And I had someone just

14:30

absolutely tear a strip off me, call me little

14:32

girl, cuss me out, all different, you name it,

14:34

just ridiculous dehumanizing, like I'm going

14:36

to call your boss, get you fired, remember Matt,

14:39

you don't know what you're talking about. Because

14:41

we had pulled a credit check, and they

14:43

were in fact bankrupt, and they hadn't disclosed

14:45

it. And they were out giving financial advice.

14:47

And that I was the

14:50

phone call from compliance that was like, Hey,

14:52

so wow, this

14:55

is the case. This would have

14:57

happened in like 2001. So it was pre

15:00

social media. But I feel like if I

15:02

was talking to that same guy today, he'd

15:04

be a guy on his website with a

15:06

ton of bling with a sports car during

15:08

the flashy lifestyle prep. So

15:10

I think there's something about

15:12

those early experiences and compliance that were

15:15

really good in terms of inoculating

15:17

me against, you know, being

15:19

impressed by flashiness. Amber

15:25

makes a really important observation here. It's

15:28

incredibly tempting to fall for the flashy promises

15:30

some companies throw at you. However,

15:32

if it sounds too good to be true,

15:35

it usually is. Now

15:37

falling for these tricks doesn't mean you're

15:39

gullible. It's only natural to think

15:41

that the companies you're dealing with are being honest.

15:44

Usually there are rules that prevent them from

15:47

promoting lies. But

15:49

unfortunately, just like in any industry,

15:51

there are bad apples who deceive

15:53

and can sometimes defraud. We've

15:56

seen this play out time and again in a

15:58

variety of industries across time. Most

16:00

recently for crypto, just take a look at what

16:03

happened with FTX. He shook

16:05

the right hands of all the regulators and

16:07

elected politicians of all parties, and

16:09

literally lied and defrauded to all

16:11

of its partners, investors, employees, and

16:14

most importantly, its clients. One

16:17

of the most challenging aspects to witness about

16:19

the FTX follow-up was that the fraud went

16:21

on for as long as it did. But

16:24

we have to understand that there can be

16:26

real consequences for being a whistleblower, and

16:28

trying to speak the truth in a time of access. Amber

16:31

can shed some light on that aspect. This

16:37

is a pain point too though, because

16:40

companies that are like that

16:42

and folks that are like that tend to be very

16:44

litigious. They tend to be quick

16:46

with the threats. They tend to be quick to

16:49

send letters or try to have

16:51

lawsuits about slander, defamation, blah, blah,

16:53

blah. And to really

16:55

prevent people from speaking out.

16:58

And I think there's a kind of

17:00

a care and caution that we

17:02

as companies have to look at. We have

17:04

to choose our battles in

17:06

terms of do you want there to be

17:08

some big ridiculous lawsuit? And

17:11

that's really unfortunate. I

17:13

think there are definitely both

17:15

individuals and companies that have really

17:17

abused the legal system in that

17:19

way. And that's a

17:21

bummer. And we have to exercise caution because

17:23

we're taking care of our own businesses and

17:25

our own reputations. And the

17:28

other point that I think is difficult is

17:30

that fraud takes seconds

17:33

to commit, right? The

17:35

fraud is almost instantaneous. Serious

17:39

financial crime investigations take

17:41

years. Securities investigations

17:43

take years. Money laundering

17:45

investigations take years. These things

17:48

are not instantaneous. The burden of proof

17:50

is very high. Sometimes

17:52

it feels frustrating where we see

17:54

these scams being perpetrated

17:56

over a long period of time and no one

17:58

doing anything about it. That

18:01

doesn't mean that nothing is happening in the background. You

18:04

were a compliance expert when you

18:06

found Bitcoin. So what was

18:08

your impression of Bitcoin as a compliance professional when

18:10

you first read about it? And

18:13

how do you think that's changed today? I

18:16

think the things that I found attractive about

18:18

it were that the immense potential

18:20

for good. And

18:22

part of that for me when I was learning

18:25

about it was that idea that

18:27

it's easily transportable. And these are

18:29

all good for compliance professionals, all things

18:31

where you're like, risk, where it's oh,

18:33

so you can have a series of letters

18:35

and numbers. You can have it on a piece of paper. You can

18:37

have it in your brain. You can cross the border with it. And

18:39

it's useful at the other side of the border. And

18:42

as a compliance person, that's terrifying. Friends

18:45

family who escaped from the Khmer Rouge arrived

18:47

here with coins in the baby's diaper because

18:50

the hiding the coins in the baby

18:53

poo was the only way that guards

18:56

at the refugee camps wouldn't rob them. And

18:59

so they managed to literally have two gold coins

19:01

when they got to Canada of the entirety of

19:03

their wealth that they left behind. And you hear

19:05

all of these crazy stories again and again. So

19:07

I think the immense potential for good

19:10

as a human was really clear to me.

19:13

I struggled as a compliance

19:15

person with the inverse

19:18

of that, which is the

19:20

immense potential for

19:22

bad things. Like here you have all of the

19:24

things that from a money learning perspective are risky.

19:27

You have this rapid movement. You have it

19:29

happening digitally. You have it happening across borders. You

19:31

have it happening in a way that's essentially unstoppable

19:34

as long as you have a miner that's willing

19:36

to confirm that block. And

19:38

so there's a lot

19:40

there. And then also this

19:43

immutable public

19:45

ledger. And I think

19:47

the first time that I started looking at

19:49

a block explorer, I just

19:52

burst out giggling. And

19:54

my first thought, and I know a lot of Bitcoiners are going

19:56

to hate this, my first thought is like, do

19:59

you know about this? Ring

20:01

Out Her! The Rcmp emerged as the

20:03

applauding. This every day of the week,

20:05

it's taken a little bit of flame

20:07

in terms of. That. Knowledge

20:10

in that technical know how to make

20:12

it's way into various law enforcement agencies,

20:14

but I think you're really seeing that

20:17

maturity now, which is where we're seeing

20:19

crimes committed. And twenty sixteen? Actually

20:22

coming to court?

20:24

At at present day is because

20:27

that's universe of and of. Their

20:29

and very clear. So.

20:32

Is it fair to say to your point? like. For.

20:34

Anyone that has concerns on bitcoins allowing

20:36

your facilitating you to do bad things.

20:39

Once. You understand the immutability of a ledger.

20:42

A. Lot of that goes away I would think

20:44

because there is. It's. Much harder

20:46

to hide inside the bitcoin network than

20:49

it is to hide inside a the

20:51

of worlds Were inside a cast settled

20:53

world like it's in Bitcoin. There will

20:55

be chromosome trails of your transactions. There

20:57

is no way. For. You

20:59

to do this reliably. Without

21:02

leaving. A trail of what you

21:04

did. so it's actually a horrible tool. To.

21:06

Do bad things with. It. Is

21:08

but I think like sometimes sick

21:11

winners zones do our says any

21:13

favors either. And. There's.

21:15

A lot of things that can be used for. Bad

21:18

thing: I have the scissors. I could theoretically get savvy

21:20

with these. That. The scissors company is

21:22

not advertising knees as the best. Scissors

21:24

for stabbing. And.

21:27

I see a lot of times where there's

21:29

something little hop and where's something will be

21:31

blocked for sanctions reasons or or for some

21:33

other. Legal. Reason or someone will

21:35

get themselves into trouble where the legitimately done

21:37

something that's our side with a law. And.

21:40

You see, just a string of posers, the religious

21:42

you should use Bitcoin, and and basically here's how

21:44

are. You. Can use this for

21:46

malfeasance a that and I think that's a little

21:49

bit. I wish we wouldn't. And.

21:51

Then there's certain types of

21:54

yeah, So. When we talk

21:56

about. Rent. Somewhere And when

21:58

we talk about payments? really? to

22:00

electronic crime that have really

22:03

propagated in a way that

22:06

I think is facilitated by the

22:08

rapid transactions. And so that's another,

22:11

it's another piece that's difficult, right?

22:13

We as institutions have to figure

22:15

out how to better deal with that. I

22:18

think that we've come a long way in doing that,

22:21

but that's still part of the struggle

22:23

and part of the balance. You

22:26

start in compliance, you find Bitcoin through this client,

22:28

he's mixed to your payment and your retainer. From

22:32

that moment, when did you decide that you wanted

22:34

to focus squarely in Bitcoin or crypto?

22:37

And how did you get your first crypto or

22:39

Bitcoin clients after that experience?

22:42

I think a lot of that early

22:44

on ended up being word of mouth.

22:46

I was introduced to an exchange. The

22:48

exchange invited me to speak

22:51

with them on a panel about risk

22:53

at Bitcoin Expo. I

22:55

started going to meetups at Decentral

22:57

in Toronto and just kind

22:59

of meeting folks and always with the goal, like

23:01

I never went anywhere to try to sell something.

23:05

I just want to understand what people

23:07

are doing, how people are using this, how is

23:09

this ecosystem working? And that very

23:11

organically led to conversations and led to

23:13

working with different folks in the States.

23:16

That genuine curiosity and

23:18

just showing up in those days was really

23:20

helpful. And then talking about

23:22

it, although I took some flack for talking about

23:24

it. So both from

23:26

people in the Bitcoin community

23:29

at the time that were like, whoa, are you

23:31

a pop? Are you investigating us? Why

23:33

are you here? What are you doing? Type

23:35

of thing, which fair enough. And also flack

23:37

from the other side of things. In

23:40

early talks that I did

23:42

that related to crypto, because I had talked

23:44

about it, because I had written about it,

23:46

I would get contacted

23:48

by clients conferences, banking conferences,

23:51

securities conferences. Like, can you,

23:53

you have a background in traditional finance

23:55

and you present well, can you talk

23:57

about what's happening in this state?

24:00

And those reactions were sometimes really

24:03

angry too from folks. I

24:05

had a really fun dressing down from a guy in

24:07

the security sector after my first security tracker.

24:10

He was like, I'm never going to offer any of this to my

24:12

clients. And you have to understand there's not enough marketing. And

24:15

he went off and I was like, it's okay.

24:17

You don't have to be excited about it.

24:19

I'm excited about it. It might

24:21

not be for you. And that's all right. And he was

24:23

like, where are you offended? I've just told you

24:25

off and you're laughing at me, lady. I

24:27

still feel that way. I think Satoshi said it best where he

24:29

was just like, I don't have time to explain it to you.

24:32

It's not going to resonate with everybody. And

24:35

that's okay. And I'm not here to

24:37

sell anyone on the idea that this

24:40

is really cool, interesting tech that has a

24:42

ton of potential to make people's lives better.

24:45

I'm excited about that. And I'm

24:47

going to keep working with folks that are interested

24:49

in building in that space and doing things with

24:51

that. But I don't need everybody in

24:53

the universe to be excited about it. There's lots of

24:55

things that I'm not excited about. You know

24:58

what's funny? It's fascinating you mentioned that

25:00

because I find that there's this genuine

25:03

peace around Bitcoin for

25:06

people that believe

25:08

in it not because of something they've read,

25:10

but because something they've experienced. And

25:14

I've experienced hyperinflation, authoritarianism, and low property

25:16

rights, and people taking stuff that was

25:18

mine, and inflating things, and

25:20

failing on promises. The way I describe this

25:22

is that for me, Bitcoin is a when,

25:25

not an if. Because

25:27

I know people are going to experience things like I

25:29

experienced. Someone in Canada right now is going through what

25:31

you went through when you were a kid. And

25:34

the second those people find Bitcoin, there's

25:37

not enough books in the world that

25:40

are going to make you sell that Bitcoin. When

25:42

you get shaken at the core of the way people

25:45

have, there is no explanation needed

25:47

for Bitcoin. And there's this sense of peace

25:49

that comes upon you. When somebody

25:51

starts laughing about the price, or laughing about

25:53

the project, or questioning your beliefs, and

25:56

you really just don't care. Like

25:59

it's an immense. This

26:01

is another place where I

26:04

think we, so we as Bitcoiners, if you see

26:06

this conversation around people where they're like, oh, have

26:08

you tried to orange fill this person? And

26:11

there's a degree of, if you're

26:13

trying to sell me something, and I think this

26:15

is true for most people, that if someone is

26:17

trying to sell me on something, I am infinitely

26:20

less interested. And Adam

26:22

Grant has a really amazing chapter in

26:25

his book, Think Again, where he talks

26:27

about something that's almost like the Socratic

26:29

method of questioning in terms

26:31

of being more apt

26:33

to change someone's opinion than trying to

26:35

sell them something. And so just asking

26:38

questions. And it doesn't work if

26:40

you're asking questions just to be waiting to jump in

26:43

to say something is you have to be genuinely interested

26:45

in the person's response. You have to be willing to

26:48

go through a dialogue where you really understand

26:50

where that person is coming from. And

26:53

this is something where people are

26:55

skeptical of Bitcoin. I'm always more

26:59

prone to take that approach if they want

27:01

to have a conversation. Sure. Let's

27:03

have lunch and let's chat about it. You can ask me all the

27:05

questions you want. I'd like to ask you some questions. And

27:08

talking about those things and talking about

27:11

what's available in certain situations, and

27:13

even talking about more typical North

27:15

American situations. I

27:17

had a contractor in New York

27:20

and I had sent her

27:22

money by wire somewhere between

27:25

my bank and her bank. It didn't

27:27

arrive. So I had the confirmation. My bank is

27:29

being sent it. We can't find it. And

27:31

this is essentially money that needed to be

27:33

used for her to pay her rent. And

27:36

what eventually happened is that this had gone on where

27:38

it's okay. The money is somewhere in transit. Okay, fine.

27:40

We have the money in our company's bank account. You're

27:42

going to agree by email that if it gets to

27:44

you, you'll just pay me back. You

27:47

need to pay your rent when? Tomorrow.

27:50

I sent her Bitcoin to her

27:52

address at her exchange and they

27:54

were able to get money. So

27:56

the Bitcoin received transaction confirmed. They

27:59

ACH money. to her account in the US, it was there, she paid

28:01

her rent. And that

28:04

really traditional finance

28:06

situation, like the most traditional of

28:08

traditional finance, when you start talking

28:10

about the time that it takes to make

28:13

these cross-border payments, and what you actually

28:15

need and what happens when something goes wrong, and what's

28:17

the traceability of that and what's the visibility of that

28:19

and what's the provenance of that, it's

28:22

almost miraculous, the way

28:24

that Bitcoin operates. Yeah. And

28:26

I want to highlight this anecdote, because we had

28:28

one of the early sessions that we had with

28:30

the first launch, and one of the first things

28:32

that we advertised for Canadian clients was that we

28:34

would disburse loans same day, no matter what Canadian

28:36

bank you were. And that was

28:38

something you couldn't do in Canada, even if

28:40

you had a bank account at TD,

28:43

you couldn't send money to someone at

28:45

Scotiab and have it arrive on the same

28:47

day. And one of the things

28:49

that we got asked a lot was

28:51

how do you guys allow

28:54

or enable same-day disbursements

28:56

for Canadians? That was

28:58

mind-bending when we announced it.

29:00

We basically had accounts in all major banks, all funded,

29:02

such that if a client showed up and they needed

29:05

to fund the TD, the account was funded from the

29:07

TD account, and then we would rebalance. And at times

29:09

out of a night, we'd have to basically take

29:11

money from one bank, walk it across the street

29:14

to the other bank, and basically deposit it. Obviously,

29:16

those days are far gone. We no

29:19

longer operate this way, but it was, to

29:21

your point, a very fiat, Canadian fiat problem

29:24

that we solved not even through Bitcoin,

29:26

but it was a Bitcoin service that kind

29:28

of gave you a teaser of what it

29:31

was like if the fiat system operated Bitcoin

29:33

did. It's fascinating to your point

29:35

how problems that are so small can be so

29:37

relatable, seemingly so simple, like not being able to

29:40

get same-day settlement from Canada to the US or

29:42

from one Canadian bank to another, whereas in Bitcoin,

29:44

you would never even have to think about this

29:46

as a nation. No, you don't have to think

29:48

about it at all. It matters to people. It matters

29:50

to people so much when

29:52

they have to do something like buy groceries or pay

29:55

their rent. You've been in compliance

29:57

since pre-9-11. You saw how 9-11 shifted. the

30:00

world of compliance. Now you've

30:02

seen the rise of Bitcoin and

30:05

crypto assets and just decentralized

30:07

and permissionless assets, decentralized and

30:10

permissionless money. And

30:12

transparently, I think the world has been

30:14

in a bit of a lull in terms of

30:16

conflict geopolitically between sort of 9-11 and now. There's

30:18

been a few flare-ups here and there. But right

30:21

now, we're squarely in a point in

30:23

time where there seems to be a lot

30:25

happening. There's little fires lighting up

30:28

everywhere in terms of geopolitical conflict.

30:30

And there seems to be a few

30:32

attempts, misguided attempts, at trying

30:35

to make crypto seem as the,

30:37

maybe not the enabler, but something that

30:39

is being used to facilitate

30:41

some of this behavior, which we both know

30:44

is wrong or probably not accurate. It's the

30:46

best way to describe it. But how

30:48

do you think permissionless

30:50

and decentralized assets have impacted

30:53

compliance to date? And

30:55

how do you think permissionless and

30:59

decentralized money has impacted compliance to date? And what

31:01

do you think it's going to do to the

31:03

future of it? I think

31:05

you hit on a really interesting issue early

31:07

on, which is how do we classify it?

31:09

And I remember thinking about that. Sometimes it

31:11

acts like a security, sometimes it acts like

31:14

a payment rail, but sometimes it's acting

31:17

like something else that doesn't really fit into either one

31:19

of those buckets. And I think that's

31:21

been hard. And that's been something that regulators

31:23

have struggled with. And I don't envy them

31:26

that question. And then

31:28

we're rapidly moving towards having

31:30

systems that are actually truly

31:33

decentralized. And I'll be the

31:35

first one to say that I think most things

31:37

that describe themselves as being a DAO, so a

31:39

decentralized finance organization or a DEX by decentralized exchange

31:41

right now are not at all decentralized. And

31:44

that's true in the vast majority of cases.

31:46

But we're starting to see some cases

31:49

where that is true. And then I

31:51

think that's a really big question

31:55

in terms of where those fit. I

31:57

think Bitcoin was a of

32:00

where it fit, particularly because

32:02

early on, there was this

32:05

sense that there isn't a set,

32:07

there's not a company, there's not a central

32:10

control in the same way.

32:12

There's not, there's not a foundation,

32:14

there's not any entity that that

32:16

you can point to. And I think that's a

32:18

big part of how Bitcoin

32:21

propagated the way that

32:24

it did. I do

32:26

think it becomes interesting as regulators

32:28

start to take interest in that. And it's

32:30

something that the Financial Action Task Force has said that

32:32

they're watching closely. I think

32:35

that it's hard, the

32:37

technology itself is instantaneous and

32:39

global. But regulation is very

32:41

slow to change and very different locally.

32:44

So even between Canada and the US,

32:46

we're more the same than we are

32:48

different, but we're quite different in terms

32:50

of our legislative framework. And

32:53

so understanding that can be

32:55

incredibly challenging. I think for

32:57

a lot of companies, when they're starting out, they look

32:59

at it and say, we want to serve the world.

33:01

And there's beautiful intention in that. But

33:04

when it's something that has regulatory

33:06

culture that's covered by laws and

33:08

regulations, there's not a global

33:10

set of regulations that you

33:12

can abide by that's going to get you everything you

33:14

need, you have to care about where you're located, you

33:17

have to care about where your client is located. Some

33:20

of that paradigm shifts, when

33:22

we start to have organizations that don't

33:25

have a geographic center.

33:28

And I think that I don't

33:31

know what that's going

33:33

to look like. I think that we need

33:35

different paradigms to deal with that. I think

33:37

that we need different tools to deal with

33:39

that. And we're seeing some

33:41

of those things emerge. I

33:43

do think that from that

33:45

perspective, again, for folks that are

33:48

working on those projects, it's incredibly important

33:50

to think about those legal contexts, and

33:52

how those tools are

33:55

actually being used, and

33:57

to look at the prevention of those tools being

33:59

used especially

34:01

if you're maintaining the code base. And

34:04

I think that's something that we've

34:06

seen in a number of recent cases

34:08

where there's this idea that, but

34:10

was this decentralized or was this really a person

34:12

who ought to have known better and who is

34:15

maintaining things and who is designing in such a

34:17

way where they were aware that

34:20

it was actually being used for malfeasance and

34:22

then did nothing to prevent that. And

34:25

I think where

34:27

that's the case, you're going to see regulators

34:29

and law enforcement that are pretty motivated

34:31

to have those facilities

34:33

shut down. I think it's

34:35

important for companies to be aware

34:38

of that, that if you

34:40

have funders and you have a company and it

34:42

has a website and it has an address, you

34:44

can't just say we've sprinkled the dust of decentralization

34:46

on something and called it DeFi and so we're

34:48

immune to regulation. No one is

34:51

buying that, not law enforcement, not your

34:53

regulators. And they are your regulators if

34:55

you're in their jurisdiction or serving customers

34:58

in their jurisdiction. And so I

35:00

think that we're going to see essentially

35:02

continued enforcement actions in that

35:05

space and companies continuing to

35:07

be reined in that

35:09

regard and either have to develop

35:11

in a way that's compliant or leave

35:13

those jurisdictions. If your compliance strategy

35:15

has been based on looking at a

35:18

much bigger company and saying, okay,

35:20

they're doing X, they obviously have

35:22

more money to pay folks than we do and they're doing

35:24

this so it must be compliant and it must be perfect.

35:27

And you then see that company get

35:29

themselves offside with a regulator and you

35:31

see the big public and you see

35:33

the big public client, go

35:35

fix your space. They

35:37

got it wrong. You based yourself on what they

35:39

were doing. That means you're also getting

35:41

it wrong. Fix it. It's

35:44

always better to find it internally, to fix

35:46

it. Even if you have to go ahead in hand

35:48

and do a bit of a mayo-clo-bo with your regulator

35:50

to say, we've made an error.

35:53

A lot of regulators actually have a

35:55

process for that where you can voluntarily

35:57

self-disclose non-compliance and it's actually

35:59

seen. in a much more positive light, particularly

36:02

when it's substantial than it is to just nod.

36:04

We knew about it. We didn't

36:06

fix it. We didn't find it where really we ought to have known that

36:08

was the case. If you're looking at one of these big

36:11

penalties that have happened recently and saying, oh,

36:13

we're in the same boat, fix

36:15

it. The best time to fix it was

36:17

yesterday, but the second best time is today. Thank

36:20

you so much, Amber. I cannot thank you enough for

36:22

sharing your story. I'm certain

36:24

that people are going to be inspired by this, and

36:27

I can't wait to do this again. Thank

36:29

you so much for having me. This has been great. Bitcoin

36:36

doesn't just make us reconsider what money

36:38

is and how it works. It's

36:41

also making us reconsider how we need to regulate

36:43

money in a digital age. When

36:46

we invented faster cars, we increased the speed

36:48

limit and demanded people wear seat belts so

36:50

that we could all move faster safely. When

36:53

digital signatures became easier and faster to

36:55

verify than physical ones, we changed the

36:57

legal definition of a signature to allow

37:00

for faster transactions. Much

37:02

of a regulatory framework in finance today was

37:04

drafted before the advent of the computer, let

37:07

alone the internet or the iPhone. Now

37:10

allowing money to move faster and with less

37:12

friction can allow bad actors to dress up

37:14

as good ones and hurt people. An

37:18

example of this is what happened to Celsius clients back

37:20

in 2021. Celsius

37:22

was a crypto lending platform that went bankrupt

37:24

because of bad practices. We

37:26

at Latin were part of the cleanup process

37:29

by being the lender that allowed borrowers to

37:31

refinance their loans out of bankruptcy. To

37:33

think that governments will not try to protect consumers

37:35

from this is naive. This

37:38

is why it's imperative that we as

37:40

an industry are open with and work

37:42

closely with governments and regulators to build

37:44

the framework that we think are needed

37:46

for our industry to flourish. I

37:49

want to thank Amber once again for joining

37:51

us, sharing your story and your insights, and

37:53

I have linked her website and all of

37:55

their social links into the show notes. Thank

37:58

you all once again and see you soon. with another great

38:00

episode. Until

38:30

then, mucha gracias, kilo skiero much. Ciao

38:33

Ciao.