August 21, 2024 • 1hr 2min

BTC196: Bitcoin-powered Banking at Fold w/ Will Reeves (Bitcoin Podcast)

We Study Billionaires - The Investor’s Podcast Network

In this episode, Preston Pysh interviews Will Reeves, founder and CEO of Fold, a Bitcoin payments and rewards company that recently went public through a SPAC merger at a $365 million valuation. They discuss Fold's evolution from a Bitcoin rewards platform to a comprehensive financial services app, the company's Bitcoin treasury strategy, plans for expansion, and Will's views on the future of Bitcoin adoption.

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Key Takeaways

Fold has gone public through a SPAC merger, valuing the company at $365 million
The company has processed $2 billion in transaction volume and distributed $45 million in Bitcoin rewards since 2019
Fold has 1000 Bitcoin on its balance sheet as part of its treasury strategy
The company is expanding beyond just Bitcoin rewards to become a full Bitcoin-powered banking platform
Fold is exploring new products like mortgages, credit cards, and loans that integrate Bitcoin
Will Reeves sees huge potential for Bitcoin adoption and integration into traditional finance in the coming years

Introduction

In this episode, Preston Pysh interviews Will Reeves, founder and CEO of Fold, a Bitcoin payments and rewards company that recently went public through a SPAC merger at a $365 million valuation. They discuss Fold's evolution from a Bitcoin rewards platform to a comprehensive financial services app, the company's Bitcoin treasury strategy, plans for expansion, and Will's views on the future of Bitcoin adoption.

Topics Discussed

Fold's Public Listing and Valuation (1:16)

Will Reeves discusses Fold's recent public listing through a SPAC merger, which valued the company at $365 million. He explains that going public was a strategic move to accelerate growth and capitalize on the maturing Bitcoin consumer and institutional products market.

The public listing allows Fold to maximize value for customers and shareholders heading into the next Bitcoin bull cycle
Will sees it as a "bellwether" for Bitcoin-focused companies reaching an inflection point
The timing and team were key factors in choosing the SPAC route to go public

Fold's Business Model and Growth (7:36)

Will provides an overview of Fold's business model and impressive growth metrics:

$2 billion in aggregate transaction volume since 2019
$45 million in Bitcoin rewards distributed to users
If distributed in cash instead of Bitcoin, rewards would only be worth $20 million
Fold card offers 1.9% average rewards rate compared to 1% for leading cash back debit cards
Bitcoin appreciation has led to 116% average increase in reward value over time

Bitcoin Treasury Strategy (17:37)

Will explains Fold's approach to holding Bitcoin on its balance sheet:

Fold has 1000 Bitcoin in its treasury
The company accumulates Bitcoin daily from profitable operations
This creates a "flywheel effect" of increasing Bitcoin reserves
Allows shareholders to benefit from Bitcoin appreciation through "sats per share"
Will sees it as a new category of public Bitcoin company - generating Bitcoin natively through operations

Evolution to Full Banking Platform (23:57)

Will discusses how Fold has expanded beyond just Bitcoin rewards:

Now offers a comprehensive banking platform for managing dollars and Bitcoin
Users can hold funds, invest in Bitcoin, use financial services, alongside traditional banking features
Fold aims to serve the full spectrum of Bitcoin users - from beginners to those fully on a "Bitcoin standard"
Recent app redesign reflects expanded use cases beyond just rewards

New Product Offerings (27:52)

Will outlines Fold's plans for new financial products tailored for Bitcoiners:

Credit cards, auto loans, mortgages that recognize Bitcoin wealth
Small business loans and accounts
Ability to collateralize homes with Bitcoin
Rewards on mortgage/rent payments - up to 1.5% back in Bitcoin

Bitcoin Adoption and Market Outlook (37:48)

Will shares his perspective on Bitcoin adoption and market trends:

Sees Bitcoin ETFs as creating new top of funnel for institutional and retail investors
Bitcoin is "eating from the inside" of personal finance for Fold users
Expects more corporations and institutions to follow MicroStrategy's Bitcoin treasury strategy
Views current environment as the "cusp of tremendous growth" for Bitcoin

Traditional Finance and Bitcoin Integration (47:27)

Will discusses the challenges for traditional banks in integrating Bitcoin:

Banks buying Bitcoin ETFs is like "putting on a life vest before helping others"
Integrating Bitcoin into legacy systems will be an uphill battle for big banks
Fold has years of specialized experience in Bitcoin integration that banks lack
Not bullish on traditional banks providing valuable Bitcoin services to customers anytime soon

Apple's NFC Upgrade and Bitcoin Payments (48:50)

Will comments on Apple opening up NFC capabilities:

Could enable frictionless Bitcoin payments via NFC in the future
Part of trend of Bitcoin "eating into payment flows and networks"
Fold has pushed partnerships to open up Bitcoin use cases
Apple's move could accelerate opportunities for Bitcoin as medium of exchange

Bitcoin 2023 Conference Reflections (50:57)

Will shares his takeaways from the recent Bitcoin conference in Nashville:

Bitcoin has "entered a new chapter" beyond the original insular community
Mainstream adoption evident in high-profile speakers and attendees
Reflects on rapid progress of Bitcoin ecosystem in just 4 years
Expects continued surprises and milestones in coming years

Fold's Vision and Team (53:42)

Will discusses Fold's vision and new board members as a public company:

Aims to continue building value alongside customers through Bitcoin accumulation
New board members bring expertise in capital markets, finance, and Bitcoin integration
Excited to allow more people to join Fold's journey as a public company
Plans to leverage new resources to pursue bigger vision and opportunities

Conclusion

Will Reeves and Fold have achieved a significant milestone by taking a Bitcoin-focused financial services company public. The company's growth, Bitcoin treasury strategy, and plans for expansion highlight the maturing Bitcoin ecosystem and increasing mainstream adoption. As Fold evolves into a comprehensive Bitcoin-powered banking platform, it is well-positioned to capitalize on the growing demand for Bitcoin-native financial products and services. Will's optimistic outlook on Bitcoin adoption and integration into traditional finance suggests exciting developments ahead for both Fold and the broader Bitcoin industry.