 from the Hard Rock Hotel in Las Vegas. It's theCUBE, covering Hoshokon 2018. Brought to you by Hoshokon. Well everyone, welcome back to our live coverage here in Las Vegas for Hoshokon. It's the first industry security conference dedicated to security in the blockchain. It's presented by Hoshokon and also the industry. It's an industry conference, it's not necessarily a Hoshokon. So I'm John Furrier with theCUBE for our coverage. Our next guest is Kinsey Cronin, Vice President of Business Development, Prime Trust. Welcome to theCUBE, thanks for joining us. Thanks for having me here. So crowdsourcing and crowdfunding, all this has been a big part of it. I mean, terrorists are funding through Bitcoin, you got all kinds of things going on in entrepreneurial spaces. So it's certainly the money's flowing with crypto. What do you guys do before we get into some of the things that we want to talk about? What is Prime Trust? Take a minute to explain your business model value proposition. Absolutely, so Prime Trust is a trust company. So it's a regulated financial institution that holds funds between transactions, between businesses. You could also use Prime Trust to create a trust account for an individual as well. So what our value is in this industry is that we hold crypto assets, which very few qualified custodians like us exist to do that. So that's a really important part of bringing in institutional funding because institutions are looking for qualified custodians as a regulated place to keep funds and they want to get into crypto. So it's a very important part of the puzzle. So custody and custodial services has been a big topic here at OjoCon. Controversial on the keynotes as well because the purists will say, hey, like Andreas, why don't we need custody? If it's working, it's the same old guard with new faces, new business cards. It's not really revolutionary and that's on one end. On the other end of the spectrum is there's so much growth and activity, we got to have trusted partners to actually help us manage the risk and do these things. So you have, again, two spectrums. What's the story? What should people understand about these two dynamics? Well, what I think, yeah, what I think the keynote you're talking about, the idea is we are just trading one type of banker for another type of banker, right? That's happening anyway. So you are, you're trading one type of financial system for another type of financial system. The question is, what does that look like and how can we be secure and safe in that space, right? Personally, I'm a big fan of anything that requires some kind of a license, right? And it's not because I think it's really fun to go through the bureaucratic process of getting a license or filling out paperwork, but it's really because that, once you have a license, that license can be taken away from you if you misbehave, right? And that's really important. So if you're following the laws that are set forth that are designed to protect people and then you break those laws, then you're not allowed to do that anymore, right? So that's what you get out of having regulation involved in this space. It's protection and it's making sure that the rules are being made. And by the way, the regulation is happening anyway, so that's another thing that's happening. Yeah, the regulation is happening anyway. And that's why these very smart people who are managing billions of dollars are looking for that. They're not saying, oh, cool, you have a website with technology that I don't understand. You're telling me that you can safely hold something, but there's no other protection there. There's no liability. You could just mount Goxme, right? And so there's got to be a way to get some sort of regulation in there. And I know there's a lot of opinions in this space and obviously I'm very much on the side of regulation. Yeah, and it also, it makes a balance. Within the day, those are polarized positions, but I think the industry recognizes growth. They're recognizing the domicile problem of companies and governments. So the question is, you know, really the license is legitimacy because people want legitimacy, trust, and growth. Yes. At the same time, what the other side says is, hey, you know, who are those people making the laws? So who's taking what away? So again, this is the ecosystem who will solve these problems, in my opinion. And I believe that, you know, as much as I love the purist view, and I think this architectural technical things that make that happen, at the end of the day is the self-governance of the community really is what needs to happen here. And so that's where the growth comes in because if real money is coming in to the sector, you got to have parties that are trusted. That's my opinion. All right, so what do you think about the conference here? What's your takeaway so far? I'll see, it's a kind of diverse background you got. You know, people walking around with colorful costumes too. Yeah. Buttoned up bankers and FBI agents and NSA agency folks. Yeah, we're in a really funny time in this space, I think, because you still have the Bitcoin garb and the flashing glasses, and then, yeah, you've got people who spend 20 years on Wall Street and now they're in this space. So I've seen that actually a lot lately in the last year at these conferences, and it's very interesting. I love when both sides can come in with an open mind to the other because you think there's something to be learned on both sides, absolutely. So for the people who have been in the traditional regulated space, they are getting all this inspiration and the possibility of doing things differently. The financial system that we have now is one, it's essentially a very old house that's just been added onto and built and there's corridors going into stairways that don't go anywhere, right? And that's something that needs to be fixed and it is being fixed. Well, security is a driver in all this, and I think one of the things I've observed here, I'd love to get your reaction to, is you have the crypto world that's certainly changing a lot of dynamics on the global scale. You have cybersecurity and then you have fintech. So you guys, and this is where everything I think is a melting pot, which is interesting. You have all these things happening, but at the center of all this is security. It's almost like we're all swimming out to the raft and whoever gets there first and wins the security model, wins it all. Well, I think the conversation all threads through security. So the cyber conversations we've had are like, okay, cyber security for individuals and nation states, cryptocurrency for protection and freedom and inimmutability ledgers and all those great supply chain aspects. And then you've got the fintech, which is like, hey, people want to do business. So you have the entire changeover on the financial services side, all kind of happening. Yeah, yeah, I think that they're all going to be contributing to a solution. Each one is going to learn. We're really open-minded at Primetrust. We want to build and grow. We know that we're in the most embryonic stage of this. And so we don't know exactly what's going to come next or what's going to be down the road. And we want to be informed by everybody that's around us at a place like this. Yeah, that makes sense, because you have to work with the industries. So take me through, I want to ask you a question about your job. So take me through the day and the life of what's going on at Primetrust. What are some of the things that you guys do, customers, and what are they asking for? What's some of the issues you guys are solving? What are some of the dynamics? Can you share some color around that? Sure, so our main services are, so we are a trust company, so we do escrow services and we do compliance on all of the escrow that comes through our ICOs and STOs that come through. So that's AML and KYC. That's really important. What distinguishes us, I think, is a real game changer for our customers is that we're really a technology company. And we have API stacks that allow for companies to build their businesses on top of integration so that they have customers coming in and making accounts on their website, their dashboard, their platform, and that's all feeding directly in. They're actually making an account at Primetrust. So you're building, you're targeting folks saying, hey, we'll take care of the heavy lifting on KYC, AML, and all the stuff that needs to happen. That's heavy lifting that's around custodial services. Custodial services, escrow services. Yeah, so it comes in, we can hold it, we can review it. You're not having asset managers also holding funds, which is a problem. So you're not needing to touch the funds at all. You can just do what you're trying to do in this phase and we'll take care of that aspect of it. That's entrepreneurial side, that's the STOs and the ICOs. What's the alternative for your customer? Build their own, go with unknown shop of their other. So if it's a great service, sounds like a great service and takes a lot of pressure off to build out of an opportunity. But what's the alternative if someone doesn't go with you, take the build your own? There's a few, I mean, it's to hold your own funds, right? Figure that out on your own. In the case of many different types of funds and businesses, their boards are not okay with that because it's too much risk and liability. So in many cases, the alternative is don't do it yet. Just keep watching and waiting and wanting to be in crypto but you can't yet. So, and we're seeing that a lot that there's like a sigh of relief when we finally have this conversation and it turns out it's extremely easy to make an account with us and suddenly that major roadblock is just gone. So that's what, that's the kind of big solution. Accelerates the opportunity. Takes the risk off the table a little bit and accelerates the opportunity. When the SEC decrypt, yes they was reporting that the SEC in the United States is actually going into ICOs and having them return their money because of they. Of course they are. Well, of course they are. That makes sense. That's, they were always going to do that just because they make a statement and slowly decide how to act. Because look, last July is when they said we're going to do this and most of the crypto community said you can't because we really don't want you to and we are going to tell ourselves all these excuses for why it's not possible for the US government to actually pursue this and why they won't really do it because they're dinosaurs. And that's just not how the government works. So the way the government does work is that everything takes a long time and it's all thought through and there are a million different approval processes within the system and they don't tell you anything until they're really ready to stand by whatever statement they make. So they leave you in the dark for eight months a year, whatever. Well, you guys have a good opportunity. So I got to ask the question, what's the business model? How does someone engage with you guys? Sounds like they go in and create an account. Is there a fee involved? What's the fee? Can you share the engagement that someone would engage with you on? Sure, so they can visit our website which is primetrust.com. They can email me, Kinsey at Primetrust, pretty easy. And we have different pricing for escrow services versus custodial services. And we actually pay interest on any fiat that we hold in custody and we charge a monthly basis point fee based on how much is in custody with us. And where's you guys located? Where's the company located? Headquarters is here in Nevada, in Las Vegas. I'm based out of Los Angeles. We've got some team members in San Francisco and New York as well. That's awesome. So let me ask you a question. How did you get into the space? What's your story? I got into the space. I started out in equity crowdfunding. So I was working with companies that were raising capital under A+, Reg D, and Reg CF. And I was in the trenches with them figuring out from like the very earliest days how what the laws were going to look like, launching companies the day the regulations came out or came into effect, and then sort of working through that. So it's been an adventure on that side. And then my first experience in crypto was at a meetup in Santa Monica where companies were talking about raising $40 million in 10 seconds and they were also pitching in methods like I knew were not legal. So it was kind of just draw dropping for me. Well, one was how did you manage to get that many people to want to invest in you so quickly? Because it's a struggle for many companies. And then, so that's amazing. I want to learn more about that. And then also, did you know that there's a more legal way to do this? And that you're putting yourself at a lot of risk. So that made me really want to jump in and figure this out. So you got totally intoxicated by the Wild West. There's a problem they got to be solved in there. It's kind of fun at the same time because you know, as long as those days are over, thankfully so, because it should be more legitimized. And it is getting there. I think security tokens are a good sign that people are moving more to security tokens, at least in the U.S. The legal firms, the service providers are starting to get leveled up on some of the new things. And that's good. It's still expensive to run the process. It's like on public almost as a startup. It's almost ridiculous in my kind of had the same view. We're the gaps, in your opinion. So you know, obviously look at the crowdfunding which has been great. You see all that stuff happening. This essentially is a decentralized efficiency around disrupting venture capital and other fundraising, which is great. We're the gaps in your mind from a service provider standpoint, from an ecosystem. Where's the to-do item? What needs to get done faster? Where are the gaps? I think everybody's building out their technology to make everything easier. Currently, there's a lot that's done manually or just too manually and needs to be more automated. And then I think there's also a lot of education on both sides that needs to be done. That's I think a huge gap. There's a tendency to create echo chambers and so you end up talking with people who just won't even consider the other side of it or the possibility for change in whichever area they're in. And that is, I think we are going to see that come together, but that tends to hold people back. Kidzie, thanks for coming on and sharing your insights. Great to have you on theCUBE. And good luck with Prime Trust. Thank you. Okay, there's theCUBE live coverage here at Hoseokon. I'm John Furrier, stay with us. More live coverage after this short break.