In collaboration with Robert Gutmann, CEO of NYDIG
About this episode: Part 1
In this “Meet the CIO” podcast, FS Investments Chief Investment Officer Mike Kelly does a deep dive on the investment opportunity today with Bitcoin with leading industry expert and NYDIG CEO Robert Gutmann. In Part 1, Mike and Robert discuss the relevance of Bitcoin today, the drivers of adoption and how to think about Bitcoin within an investment portfolio.
About this episode: Part 2
In Part 2, Mike and Robert dive into an overview of NYDIG and what they do, institutional adoption of Bitcoin and the environmental impact of Bitcoin.
Mike Kelly (00:54:09):
So, but with that really honored to have this evening to have a discussion and to speak with Robby Gutmann. Robby is a co-founder and CEO of NYDIG. He’s also a co-founder of Stone Ridge where he is a member of the firm’s management committee and investment committee prior to taking on his role as CEO of NYDIG. Robert served as the head of product development and execution at Stone Ridge overseeing the investment strategy formulation, and serving as a portfolio manager on all of Stone Ridge’s funds. Robby received his BA in Mathematics and Music from Columbia University. So thanks Robby for joining us.
Robert Gutmann (00:55:05):
Thanks, Mike. It’s a pleasure to be here. Pleasure to be speaking to you and the entire audience tonight.
Mike Kelly (00:55:11):
It’s great. It’s great. Well, I thought what we would do is just start with a real broad philosophical question, which is, “why in your mind is Bitcoin so important? And what does its existence represent to you in your mind?”
Robert Gutmann (00:55:32):
Sure. I’ll answer both of those the same, which is, in my mind, Bitcoin represents the first time in human history that we have a technology that provides an open source monetary system for every free individual on Earth to engage with. And for those of us who were fortunate enough to live our lives denominated in the dollar, it may not be quite so visceral as to why that’s so important. But if you live your life, for example, denominated in Argentinian pesos or Venezuelan bolívars, the idea of an open source technology that you can store your wealth in, store your day’s labor in, that’s something that’s never before existed in human history. And it’s literally life-changing to have access to a money that your government can’t confiscate or inflate away.
Mike Kelly (00:56:26):
Great. Now we probably have a real range of expertise and experience and understanding of Bitcoin generally. So maybe for those here that are not as familiar with Bitcoin and cryptocurrency, can you give us a quick summary of what is Bitcoin, how it works and who creates it?
Robert Gutmann (00:56:50):
Sure. Bitcoin is an open source network. It runs on the internet, just like the open source protocols that run your email or your web browser. Except instead of sending webpages over the network or emails over the network, you use it to send value over the network. That’s the easiest way I can think of to explain it. In terms of who created it, it was created by an anonymous person. In late 2009, an anonymous person that called himself Satoshi Nakamoto published a white paper outlining this open source protocol. And the way it’s created is through a process called mining. You may have heard that term. And what that is every 10 minutes, the protocol itself creates new Bitcoin and entities called miners compete to win those new Bitcoin in a process that actually secures the network. So it’s a beautifully designed game theory aspect, essentially where the people that secure the network, that make sure that you can trust that your Bitcoin aren’t getting stolen by somebody else, they’re actually self interested in making sure that the value stays high.