Israel-Iran Conflict Escalates & Stablecoin Bill Advances 6/20/25
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Bring in show music, please. Today on SquawkPod: President Trump says he'll decide within two weeks on whether to join Israel's campaign against Iran. We're joined by Israel's economy minister Nir Barkat. We want to make sure that Hamas will never exist after this war.

The first major legislative win for the crypto industry passed in the Senate earlier this week. Crypto expert and Han Ventures CEO Katie Hahn. We're talking about trillions and trillions of dollars of disruption coming. Plus, President Trump extends a TikTok ban for a third time. The U.S. hits a new record of millionaires. And do you know the population of Iran? Now I know 92 million.

I'm CNBC producer Zach Valisi. It's Friday, June 20th. It's a Friday in the summer. Squawk Pod begins right now. Stand and or by in three, two, one. Cue Andrews.

Good morning and welcome to Spotbox. Right here on CNBC. We're live at the NASDAQ market site in Times Square. Are you real? Are you here? There's Joe Kernan right there. Are you real? Becky's off today. I am real in the flesh. It's nice to see you after almost... Can I touch you? It's almost been like two weeks. Can I touch you? Maybe a week and a half. If I keep it clean.

You really are. It's nice to see you, sir. It's good to see you. A lot going on. Spamming the globe. Spamming the globe. I was out in Stockholm at that brilliant mind segment. I called in. Oh, my God. Have you got the syndrome? Which is Stockholm. I don't have the Stockholm syndrome. Hopefully you resist. And then I was just out in Cannes. I know where all the marketers. That's cool. Yeah.

That's cool. Muckety-muck. We're mucking around. That's cool. The film festival is not quite yet, is it? I think the film festival just happened. Oh, it already happened. I think it already happened. That's right. We couldn't go to that for some... We go to these film festivals. One of these years, we're going to go. One of these years, we're going to go. Telluride at the end of the summer, which is always...

Beautiful time to go. I guess we should tell people what's going on. Iran's foreign minister says the country won't agree to de-escalation talks while under attack by Israel. He made those remarks to Iranian state TV today. I guess the studios that are still intact are.

Also, ahead of a scheduled meeting in Geneva with the foreign ministers of Britain, France, and Germany, and a top EU official in Washington, the White House press secretary delivering a message from President Trump that he will decide within the next two weeks

whether the U.S. will get involved in the Middle East conflict. Yesterday, Iran struck a major hospital in Israel's largest southern city. For its part, Israel said it hit two nuclear sites in Iran, in addition to targeting a partially built heavy water reactor in the central part of the country. There's a lot, apparently, that

that the president and his people are talking about. Does it work? - So we haven't talked about this, you and I, which I'm excited for this morning. So I wanna know what you wanna do. - I'm not in the isolationist camp at this point. I think it's a unique opportunity, a unique opportunity. - Can you explain to me-- - Do a one and done and say I'm satisfied, but maybe within two weeks,

That's enough time. If they look around, I mean, there's no, you know, Hezbollah hasn't launched any missiles. Hamas seems to, the Houthis, none of that's happening. This is a unique opportunity which Israel has presented the world with. No, I think it could be remarkable. I was reading an article last night, though, about these bunker busters and whether they work. Right. And that to me is the almost...

The beginning, middle, and end of the entire conversation. If they work, you use them. If they don't work, I don't know what you do. I watched yesterday the individual that was involved in the development and the testing. He says, I think you have maybe a couple of entrances. You do two in each. You can do a couple. You do two. One opens it up. The next one. And we can GPS them right.

to exactly where you want to go. Do we need an authorization from Congress for this? Bush got them for both. I don't think we could get one, though. And I don't think there are provisions where if you say it's an emergency situation, that's kind of a it's in the eye of the beholder. So here's is it an emergency situation for the United States that Iran apparently within two weeks could say,

the I told could say, build me a bomb and it could be done in two weeks. Well, in which case, then you got to move quicker than that. Well, then I'd say that's an emergency for the United States. I'd say that that what is going on is help me because I've been away for

The whole Tucker thing, the whole Steve Bannon thing. I don't understand the Tucker. There's a sort of a troop who are very much in the passive based situation. There's a great piece in the journal which explains exactly your question. Why are they call these individuals misguided? Because they don't see any difference between...

what's happening with Iran and what happened with Iraq and what happened with Afghanistan. So they don't want an endless war. They think that they're, you know, it would somehow be dragged out, would be dragged into a much longer, you know, situation than just,

Then just doing Fordo and saying, I'm satisfied now and we're not going to try to do regime change unless it happens organically, which, you know, that was supposed to happen in Iraq, too, with the flowers from all the people that never did. But it might be a different. I think every every situation is different. Right. And we don't want I mean, of all people.

Trump is not someone that you would think of would start a foreign war. Okay, I got one more for you. I did not know that Tucker and Ted Cruz had a beef or a thing or a something. So prior to this beef, prior to the latest beef. I just didn't even, I thought they were on the same team. That was a shocker for me. Do you know how many people were in Iran? Now I know, 92 million. All right, huh? Yeah. 92 million. Exactly, the distance from the sun. Right.

I probably couldn't have nailed that. I think I could have gotten within 50 percent, maybe. How many people are in? You know, the ethnic mix. A lot of different, different. You don't look at the tables. Different ethnicities. There are a lot of different ethnicities. And I know that was incredible. All right. And I think those were kind of like, you know, Tucker was loaded.

bear with a lot of that. I don't understand the whole APEC thing. I don't understand the whole, you know, there are times we all agree. I think Tucker agrees that Iran can't have a nuclear bomb, right? Does he at least acknowledge that? I think so. Tucker's a very bright guy. No, but this regime, I was around in 1970. I don't know if you were just born, probably. That was

When this happened, they've been a thorn in the world's side, the biggest state sponsor of terrorism that the world has ever seen. There's nothing, I don't think there's any redeeming qualities of that regime. Can you name one? Because we're talking about Cruz and Tucker, for those who haven't seen it, though I think maybe like 100 million views already or something, here's what we're talking about.

How many people live in Iran, by the way? I don't know the population. At all? No, I don't know the population. You don't know the population of the country you seek to topple? What's the ethnic mix of Iran?

They are Persians and predominantly Shia. OK, this is not even you don't know anything about Iran. So, OK, I am not the Tucker Carlson expert on Iran. You're a senator who's calling the government. You're the one who plays about the country. Well, there's some conflation going on there. No one's talking about toppling or nation building or anything. We're talking about one thing.

finishing the, what Israel started with the nuclear. Well, so that's actually though an interesting question. Let's say you quote unquote finished this. Yeah, for 10 years at least. Right. But, and then what happens? I know we're not, if we're not technically talking about toppling or we're not talking about, you know, replacing people at the top, the question is by doing this, have you then created a situation where you have toppled? I don't know. A lot of the, I'm not sure at this point how much

How much support this regime really has, I don't know. I'd like to think that the people there, if given the chance, because right now they're not at all given the chance. They have no choice of who's running that country. I worry about a Chernobyl type. I don't want all the groundwater in the entire Middle East to be radioactive. So there's a lot of... But I think President Trump seems like he's...

You know, at least he's not rushing in to anything unless it happens tomorrow or something. Because, you know, there were reports that there were plans for this weekend. If you say within two weeks...

You know, he's the master of not knowing what the heck he's going to do. If you just say within two weeks, does it mean you have to wait two weeks? Or could it be within two weeks? Well, I mean, this goes back to the other question of whether you lull people into complacency by thinking there's a negotiation. That argument was made earlier. No signs of really any type of bend. I don't think they can. That's their whole shtick.

President Trump giving TikTok another reprieve now in the United States. He signed an executive order that extends by 90 days now. So it's another 90 days, the deadline for his administration to try to bring that app under American ownership. It's the third time the president has pushed that deadline. There is no clear legal basis, though, for the app.

for the delays in pushing the deadline, but there have also been no legal challenges thus far against them. And the question at this point is, clearly TikTok is a chess piece in the larger discussion with China. I don't know, I mean, the whole Iran situation sort of- It's a pretty big discussion with China. Makes it more complicated. Does it help? I don't know if we are gonna delay this again, you know, 90 days from now, just because, you know, it's gonna take some time to figure out what to do.

Do you think the TikTok at all? Do you think action on Fordo makes China think twice about Taiwan? You mean, does it say to them, OK, we got to move now? No, no. Does it say we need to think about because they're these they're not isolated. Trump is not an isolation that way because because we're not the prime mover. Right. But the journal was saying that Afghanistan and the reason that all these things happen is.

you know was the way we withdrew from afghanistan and obama's red line in syria and nothing ever happened right but the difference is in this case what's happening in iran it may be that trump ultimately gets involved in iran we'll see but clearly this has been the prime mover has been israel so the idea that we're going to be the prime prime mover in taiwan we've we've been a reluctant no matter how you look at it we're a reluctant mover at this point i can't imagine that we'd

go to war over Taiwan. And therefore, that's why I said, do you move now? Because I think in some ways, some of this suggests actually we're maybe even more inclined to be reluctant in a Taiwan situation. But I don't know. I think more likely, by the way, on TikTok, you're going to see a sort of nip on

You ask me a lot of questions. You ask me a lot of questions. I've got to defend Trump all the time. I know. Let me ask you a question. It's 92 million. There's 92 million people in Iran. That's all I know. Okay. Let me ask you a question. Do you wish Kamala Harris was president right now? Do I wish Kamala Harris was president right now? Do you wish Joe Biden was still president right now? You know what? These are rhetorical questions. I don't expect an answer. I just want you to think about...

those two, for me it's like,

an obvious answer to me, but it's probably not obvious to you at this point. No, nothing's obvious, but the other... I think Trump, I think that he's... Because your view is, and I imagine that if Biden were the president... Oh, my God. Hold on, but if Kamala Harris were the president... Then Ron Klain and Anita Dunn and Susan Rice would be decided. Or Ben Rhodes, or who knows? The question that I think to myself is, would Netanyahu have moved? And I wonder whether he would have, in which case, then the answer is...

obvious which is you what i think that's not what he's done thus far but clearly his work is seems at this moment it's going back three or four it's going back to when they started with the pager idea and all that stuff right and so the question is what would have he done with a different president would it have mattered i don't know is the answer well i'm just just for right now having i just i understand i i hear you i don't need a word salad explaining to me you know in a

doubt if she knows how many people are in Iran either. A new report by UBS says 379,000 more people became millionaires last year in the United States. There are now almost 24 million millionaires in the country, and that's by far the most in the world. Mainland China, interestingly, was second with 6.3 million. Now, is that yuan or

You have to have a million. You know, probably dollars should be dollars. Otherwise, it doesn't really count. Of course, I was kidding. You can read more about the report and Robert Frank's inside wealth newsletter. Go to CNBC dot com slash inside wealth. And I challenge you. Yeah, challenge me to say something negative about that. I don't look for a positive morning. It's a Friday. It is in the summer. We could interview Bernie. I guarantee you he's pissed off about this.

Guaranteed. I guarantee you're right. Tease will be next. Next on Squawk Pod, tough talk as we speak with Israel's Minister of Economy and Industry about his country's ongoing conflict with Iran. We're telling the region, telling the world, don't mess around with Israel. We know how to deal with our challenges, focus on peace with us, expand the Abraham Accord. But if you come to fight with us, you're going to lose your war. We'll be right back.

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This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information-packed daily market preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions, and key results and statistics that may impact your trading. Download the latest episode and subscribe at schwab.com slash market update podcast or find Schwab Market Update wherever you get your podcasts.

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This is Squawk Pod. Here's Andrew. Right now, we're going to talk more about our main and top story of the morning. President Trump saying he's going to decide soon on whether to join Israel's campaign against Iran. The two countries trading attacks again today. Yesterday, Israel's main hospital in the southern part of the country was hit with an Iranian missile. Tel Aviv also hit by missiles with one falling plane.

very, very close to the Tel Aviv Stock Exchange, partially owned, we should mention, by hedge fund manager Bill Ackman. Nia Barkat is Israel's Minister of the Economy and Industry and is with us this morning live from Israel. Good morning to you, sir. We appreciate you joining us so very much.

Just speak to us, if you could, about sort of how you see this military escalation taking place, what happens over the next two weeks, and what do you think Israel does, almost irrespective of what the U.S. does? Well, first of all, thank you for having me.

We have a very clear objective. Iran, the jihadi leadership of Iran, for decades have built themselves to eliminate Israel off the map. They are focusing on creating nukes. They have a significant amount of ballistic missiles. And they built a proxy strategy around Israel. They funded and trained Hamas, Hezbollah, and regional cells, jihadi cells, that are focusing on terrorizing the state of Israel.

And so what Prime Minister Netanyahu has done, he's been really, really focused on eliminating those proxies. And now we are focusing on making sure that Iran will never have the capabilities of nukes and will never have those capabilities of ballistic missiles to target Israel. Any country in the world understands what we're doing right now. And I think that...

The Iranian regime now understands that it's not worthwhile messing with Israel. Minister, the question is, the U.S. has these bunker-busting bombs. And there's a question whether the bunker-busting bombs work. It is at all to begin with. But it's also clear that Israel doesn't have, I don't think, that kind of weaponry. And so if the U.S. doesn't come in behind Israel, what happens?

Well, I think we've demonstrated the creativity of the warfare Israel knows and is capable of doing. You saw the beepers in Lebanon crunching, crunching Hezbollah. You saw the first phase of the war, eliminating leaders of Iran, at least their army. And you saw that one stage after the other, we know how to get our things done. We've done our homework.

And we're not going to stop. We're not going to stop. We're going to do this ourselves if needed. And if others join us, more than welcome, because we're not just fighting Israel's war.

I want to share with you that this morning we saw pictures from Iran burning the Israeli flag and the U.S. flag. We in Israel are considered the little Satan and the big Satan is the United States. We're all aligned here. We have the same goals, fighting jihadists that want to kill us. So when the president says that he needs two weeks to decide what to do and to maybe sort of pursue some kind of diplomatic resolution to this, what's your position?

We understand the end game.

Well, eventually we will not stop this war until we are sure they do not have those capabilities. Because if they have those capabilities, they demonstrated that they will use them. If the proxies work, they use them in October 7. We cannot allow that again. They use hundreds of ballistic missiles targeting at Israel. And unfortunately, we saw where also Israeli citizens have been, innocent civilians have been killed. You saw the attack on the hospital today.

And we want to make sure that they never have nukes. We believe them, that they mean to use those nukes to eliminate Israel. We will not let that happen. So regardless if the U.S. joins us, and we'd of course be very happy to, but that's President Trump's decision to make, we are committed to the same, to the goal eventually. We have no choice but to make sure they don't have those capabilities.

Minister Bargat, does it even make any sense to talk about what the possibilities are for Israel to deal with Fordo if the United States declines to do that? You were a paratrooper. What would that look like? Would special forces be dropping nearby? I'm sorry.

Hopefully you agree with me that we don't want to let them know our class. I don't think it's prudent to discuss the plans of how we take them out with you folks because they also listen to CNBC. We don't want to give them that information. But you're confident that if you'll do it on your own, if you have to, and it's not going to be finished until Fordo is, I mean, probably everything. They say they've moved. I don't believe them. They say they've moved a lot of stuff out of Fordo. That's the...

I mean, that's got to be taken care of to call this a mission accomplished. We will accomplish all the goals of the war with Iran. We will accomplish all the goals in Gaza. We want our 53 hostages that are still in tunnels in the dungeons of Gaza. We want to make sure that Hamas will never

exist after this war. They have to completely surrender, put down their weapon. And that day, by the way, the day that they return our hostages and put down their weapon, the war in Gaza will stop. And so we are committed, Israel's committed, to make sure that we'll never go back to October 6th.

We will make sure that Iran does not have those capabilities to attack Israel or the moderate Arab states in the region. They're also really concerned about the power that Iran had. We want to make sure they don't have those capabilities.

Minister, does that effectively mean toppling the regime? Meaning there's sort of two component parts here. There's removing the nuclear capability of this country. And then there's who's running this country and what comes next. Yeah, that's a decision of the people of Iran. I mean, if they do, we certainly won't shed a tear.

And if we could chip in a bit of help, we will do that. But that's not the goal. That's not the primary goal of our operations in Iran. We will settle for making sure they don't have those capabilities. We'd be happy if indeed something like this will happen. And I want to share with you that as minister of economy, I see a huge, huge spike of economic growth for Israel.

The region in the Middle East is looking for us to complete the work. I'm sure that the Abraham Accords that President Trump really pushed forward could expand to include the Saudis, Indonesia, Azerbaijan, and we'll probably also find new solutions, different solutions with some of the leaders, local leaders in Israel to join Abraham Accords in Judea and Samaria.

And I'm very optimistic. I understand that the more you become bad with the bad guys,

the better we become with the good guys and the new alliances that will happen after the end of this war I'm sure we're going to get significant prosperity not just in our region the world will be much much better much safer without Iran being such a bully as they were and still are and we'll make sure they don't Mr. Barkhata if President Trump is watching and he sees that Israel is going to handle this one way or another doesn't that

sort of induce him maybe to stay out and say they're going to handle this. I mean, there is risk to the United States getting involved. And, you know, there's a lot of discussion on both sides over here about whether to do that. I mean, if you can handle it, I'm sure he'd prefer that you would handle it. I think the loss of life would would probably be worse and extended and all the fighting would go on much longer, obviously. So that might be something to consider. Yeah.

But if I could speak on behalf of all— Do you need the United States help? You need the United States help or not? First of all, I could certainly say on behalf of all of Israelis and my prime minister and the whole government, we're very thankful, extremely thankful to President Trump and the United States. We use a lot of your weaponry. We get supply. We get your sort of an umbrella protecting Israel in the United Nations. And we do not take this for granted.

certainly be happy if the US joins and it certainly could shorten the timeframe of this war. And I think that if I could say, I could say it's in Israel's best interest, but that's not the point. The point is, I'm sure that President Trump will act upon the American interests first and we respect that. And if he decides to go on, we'd be happy and we're thankful anyway. What if there's another Iran deal?

God help us. Another Iran deal for monitoring enrichment, all the things that we know, you know, Iran probably didn't comply with in the past. But, you know, there are negotiations going on. If if there were to be a negotiated settlement, would you honor that? Are you still going to take care of your your business there with Fordo?

Well, if you have to chew, chew, don't talk. Enough talking. We don't trust them. They're unfortunately a regime that is sending their children to commit suicide. They train to kill, and they have no problem lying and trying to smear the time. We understand that. It's not going to work. End of story. We're not going to stop this until we make sure that there's no nukes and there's no missiles aiming at Israel.

Enough talk. Minister, interestingly, the Tel Aviv stock market, which we just acknowledged at the top of this interview, you know, had bombs literally landing next to it, yet it has been on a huge run. What do you make of that? Well, I think the world understands that Israel is going to win this war and is winning this war. And the opportunities are huge. And that's why people are investing in our stock exchange. And

I have to share with you, as Minister of Economy, I speak to many, many of my peers around the world. They want our experience.

Look at the security side. Everyone around the world, our friends around the world are saying, "Hey, whatever you use to secure Israel, we want because it's being tested." Fighting terror, combating terror. Our friends around the world are saying, "Share with us how to combat terror." And then that innovation also includes classic high tech, agro tech, food tech, desert tech,

climate change, advanced industries. So the people understand that we're very innovative. And after a war, you see a huge spike of growth. So people are expecting that. And I see the huge opportunity and we're preparing our infrastructure for economic growth. And that's why you see it in the stock exchange.

And then finally, Minister, just a personal question. How do you feel about your own safety and those who are in places like Tel Aviv and other parts of Israel as we read reports and hear about bombs raining down? And how many more bombs and other kind of missiles do you think Iran has and is able to position towards Israel? Well, I'm happy you asked that question.

You know, we're all, the majority of us have served in the army and we manage risk and we all understand that we have no choice. There's only one Jewish state. That's our secret. And in all wars, you see the war in Ukraine, 4 million Ukrainians left Ukraine. And everywhere there's a conflict, you see people flee, leave the region. With Israel, 100,000 people came back to fight.

And you see right now, you see there's a huge line of Israelis that want to come back and they want to take part of the war. And so it's a question that Israelis answer very quickly. What do you mean? We have no choice. Of course we're here and we're dealing with our security. We have really good bunker to protect ourselves. We have good army and we have good defense. But also now we've demonstrated that we have good, really good offense.

So all in all, we're telling the region, telling the world, don't mess around with Israel. We know how to deal with our challenges. Focus on peace with us. Expand the Abraham Accord. But if you come to fight with us, you're going to lose your war. Minister, I want to thank you so very much for joining us this morning. And we do hope you stay safe. And we do hope you come on back and keep us apprised of your progress. Thank you very much.

Next on SquawkPod, after the Senate passed the first federal framework for stablecoins called the Genius Act, our next guest believes there's a big disruption coming. Genius Talk with crypto expert Katie Hahn. The question that has stymied courts and crypto founders is what's a security? What's a commodity? Who's going to regulate those? Choose the best Honda with more Best Buy awards than any other brand.

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This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information-packed daily market preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions, and key results and statistics that may impact your trading. Download the latest episode and subscribe at schwab.com slash market update podcast or find Schwab Market Update wherever you get your podcasts.

You're listening to Squawk Pod. You're watching Squawk Box on CNBC. I'm Joe Kernan, along with Andrew Ross Sorkin, who came back on a Friday. That's an interesting move, is it not? Well, there was a holiday yesterday. There was, I know. So I came back yesterday. By the way, I've decided... Becky's off, but I've decided...

If we ever do a four-day work week, I want to do Thursday. I don't want to do... Really? Yeah. You do three days. Then Wednesday, you can stay up. You know, you get Thursday off. And then what do you got left? One day. Got one day. What about just doing it on Wednesday? That way you go two and two.

I don't know. Let me think about that. Earlier this week, the Senate passing the Genius Act, the first federal framework for stable coins. Joining us right now in an exclusive interview, I keep calling her the OG. She really is one of them. Katie Hahn, founder and CEO of Hahn Ventures. She was previously on the board of Facebook's Stablecoin Project and former board member of Coinbase when the company launched USDC. Good morning, Katie. It's been a long time. How are you?

Good morning. It has been a long time. I'm doing well. How are you? Thank you for having me. I'm great. Thanks. In terms of the Genius Act and what comes next, obviously the House is what comes next. But where do you see the fault lines in all of this? And and to the extent it changes the stable coin world, you know, we have Circle just went public, obviously. What is the stable coin world look like to you a year or two out after all of this?

Well, it looks much bigger, not just after the Genius Act. It was already growing. And, you know, I debated Paul Krugman, the economist, in 2018 on stablecoins. And you can go watch it on YouTube. And I said then this made a lot of sense. And just because something—a wise person told me just because something's inevitable doesn't mean it is imminent.

And indeed, while many people have been declaring the blockchain and digital asset space dead over the last few years, we have been investing into stablecoin infrastructure, stablecoin applications. And I think what we've seen, Andrew, is just tremendous growth. Let me give you three statistics that I know you've had Jeremy and Circle, a lot of buzz there. But let me give your viewers three stats on stablecoins.

something that didn't even exist six years ago, seven years ago, a quarter of a trillion dollars of supply. And that's up so much year over year. I mean, the growth has been really exponential. You're talking about just over a year ago, $100 billion of stablecoin supply. So it's really growing very rapidly. And we think that growth will continue, particularly with the advent of the Genius Act.

But it's not just that. Another statistic that I think people are surprised to learn about stablecoins is stablecoin transaction volume for the first time eclipsed the transaction volume of Visa last year. I'm not sure if you knew that. And then the third thing about stablecoins is they're now the 14th largest holder in the world of U.S. treasuries.

having surpassed the economies of Germany and Norway, as the largest holders. So, Katie, that raises to me a whole other question, and I think one that's worth delving into, which is to the extent there are risks in our economy and in our system, what is the chance that the stablecoin universe is upended in some way that we don't understand? Because either there are not enough treasuries that are backing the stablecoins and a player is not as...

you know, compliant as you want them to be. That's on one end of it. The other end of it is if you have the concentration that we're talking about of one of one company or a group of companies owning so many treasuries to try to back the stable coins, how should we think about that?

Yeah. Well, when I'm talking about stable coins, Andrew, also let me be really clear. I'm really talking about fiat-backed, one-to-one, dollar-backed or fiat currency-backed stable coins. I'm not talking about algorithmic-backed stable coins. Although a really interesting idea, we did see some spectacular failures in that area not too long ago. So what I'm talking about are fiat-backed.

And in many ways, I think one of the really great things about stablecoins, fiat-backed, particularly with this legislation, is for every one USDC that Circle issues, there is $1 in a, for example, JP Morgan bank account.

And we all woke up to the limitations of the fractional reserve banking system with Silicon Valley Bank. So this is fully reserved. And I think that's important. But you mentioned the Genius Act. And I think let's come right back to that, because I think the space we you said you called me an OG. I've been in this space for 10 years.

One of the things I've been saying since I first came on your show, I've been asking for regulatory clarity and more rules of the road. And I think the Genius Act is exactly that. And I think, you know, if you're talking about risks, let's get some legislation in. So that's why I think it was really exciting that House or sorry, Senate Democrats and Senate Republicans came together to pass this historic bill. But may I say, I think the really transformational effect

crypto framework is also the market structure bill. And I know there's been a lot of talk of both. Of course, the question that has stymied courts and crypto founders is what's a security? What's a commodity? Who's going to regulate those? And there's a perfect opportunity for the Senate and the House to also get that bill. And I think we saw 70 House Democrats last year join in support of a bill like that. So let's get both passed.

And I think that's really, yeah. Katie, what do you make of just the reason I was focused on just the risks in the system, because actually now as this business is really growing, you know, we were speaking to the CEO of Tether before. Obviously, people have been demanding more transparency from that company, for example, for a long time. Where are the risks in the system to the extent there are some that we should be thinking and concerned about, if at all?

Well, look, I think some of the risks exist in the same banking system, right? Let's have audits. If you talk about USDC, which is a large stable coin, after Tether, it's the second largest market cap. I mean, you're talking about two issuers, Coinbase and Circle. Those are public companies. They're audited by big four accounting firms. So let's see. And if companies are going to stay private,

Let's see the audits happen every year. And I think I'm not sure about Tether, but I do believe they have a board. Do they have an audit and risk committee? I'm not sure. You'd have to when you have follow on next time, you'll have to ask those questions. And those are the questions I would be asking. But I know with respect to USDC, I've been familiar with Circle and with Coinbase for a long time. And, you know, when I served on the board of Coinbase,

I saw those audit reports and I saw the procedures and processes in place. And again, I think that's where not all stable coins and not all stable coins are created equal. I can really speak mostly to USDC given my history and experience, but there

There are other great stable coins out there. And I know that others are in the works too. Paxos has one also, for example. And we'll see others emerge, I suspect. A lot of people talk about the market opportunity, Andrew, as just yours. But as I mentioned, there's the orchestration layer, also plays an important role. Kind of think of it as Grand Central Station, the rails.

That's a really important piece of this all too. And what kind of companies are those? I mean, we saw Stripe just acquire Bridge for a billion dollars. And Bridge is not the only game in town, right? We also have, for example, BVNK. That's another orchestrator for the stablecoin space. And I think the reason that you're seeing a lot of new entrants is because the market opportunity is so big.

Hey, Katie, I know just enough to be dangerous about stuff like this. So this might be a stupid question, but if you a couple of times you said, hey, it's based on fiat. If you say that to like someone who's orange pilled, it's like based on fiat. It's like that's the whole rationale for Bitcoin. So what can we do?

To make a stable coin based on Bitcoin or Bitcoin eventually become analogous to what a stable coin is if it finally gets to a point where it just has a very stable. I don't. Does that ever happen as we get closer to. I don't know.

I think, look, Joe, I think I'm glad you brought up, I think you're talking about Bitcoin and I'm glad you brought up Bitcoin. We're obviously also long Bitcoin and I don't think the two are mutually exclusive. In fact, backing, zooming out, Bitcoin is the granddaddy of them all. This is what launched Satoshi's white paper. If you read it from 2008, it called for an electronic peer-to-peer payment network.

So really, stable coins are kind of the original vision of Satoshi. Now, Joe, as you mentioned, there's been a lot of volatility historically in Bitcoin. And, you know, think about gold. You know, people forget gold lost 30 percent of its value in the 1970s. I mean, there's no denying that Bitcoin has been volatile. But let me tell you an interesting statistic about

bitcoin that your viewers might or might not know um we're still so early and by the way we're still so early in the stablecoin space although i gave you all those impressive stats the reality is only 0.2 percent of payments in the world are made with stable coins so we still have a lot of room left to go same is true by the way on bitcoin and those of us who have been uh watching bitcoin and investing in bitcoin for a long time like we have

we look at the bitcoin space and we think right now it clearly has product market fit as a store of value now will that ever morph will things like the lightning develop uh network on top of bitcoin um also play in the same world as stable coins maybe um but what i will tell you right now is bitcoin is seeing some real institutional adoption and here's the statistic i was going to give your audience

In traditional asset classes, you've got traditionally about 80% of other asset classes are held by institutions and 20% are held by retail. And in Bitcoin today, we think it's still so early because the institutions are still just at the beginning of coming in to the point that Bitcoin, only 10% of the world's Bitcoin is held by institutions.

So really, it's very much flipped from other asset classes. And we're starting to see that change. Now, why are we starting to see that change? Things like the Bitcoin and Ethereum ETFs were approved. It's just another signal that this is not going away. Another imprimatur. I know there are plenty in the crypto community who don't need government imprimaturs. But guess what institutions do? And so when you have things like the Bitcoin ETF approved,

what was it, a year and a half ago. And Andrew, you remember I said ETFs will be approved and it was very unpopular at the time. People said, you're crazy, they're never gonna be approved post FTX. But we saw that DC Circuit opinion unanimously, most liberal judge, most conservative judge joined together and said, really leave the SEC no path but to- - Okay, so Katie, given that you've been right about the predictions thus far, we're at about 105,000 bucks on Bitcoin?

You want to call it? Make it easy. Not easy, but I'll give you a lot of time. Three years from now, 36 months from now. Andrew, you know, I'm never going to do that. The former prosecutor in me would never. I think it would be totally irresponsible of me to do that because we see the volatility. I got to try. I got to try. If Bitcoin becomes stable, why do we need a stable coin? Does everything a stable coin does? Well, no.

Joe, that is absolutely a first class problem for the crypto industry. And we have dollars out in the world. We have euros out in the world. We have credit cards in the world. We have countless payment apps out in the world. And you know what? A lot of them are pretty big. We're talking about trillions and trillions of dollars of disruption coming. Both via Bitcoin and stablecoins. Based on fiat. You said it. Based on fiat. It's like...

You got the answer, right? Staring you right in the face. I'm not a Bitcoin maxi. I'm a crypto maxi. I believe in. No, I haven't told you. I'm willing to. I don't know if I know what I'm talking about. Anyway, Katie. But Katie does. Katie Hahn. Great to see you.

And that's the pod for today and the week. Thank you for listening. Squawk Box is hosted by Joe Kernan, Becky Quick, and Andrew Ross Sorkin. Tune in weekday mornings on CNBC at 6 Eastern. To get the smartest takes and analysis from our TV show right into your ears, follow Squawk Pod wherever you get your podcasts. We'll meet you back here on Monday. Have a great weekend.

Thanks, guys.

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