Former BlackRock Executive Joseph Chalom: Why Ethereum Will Reshape Global Finance

Original Title: Ex-BlackRock Exec: Why Ethereum Will Reshape Global Finance | Joseph Chalom

Guest: SharpLink Co-CEO, former BlackRock executive Joseph Chalom

Host: CoinFund CEO Chris Perkins

Podcast Date: September 10

Compiled & Translated by: LenaXin

Editor’s Summary

This article is compiled from the Wealthion podcast, featuring SharpLink co-founder and former BlackRock executive Joseph Chalom and CoinFund President Chris Perkins. They discuss how the tokenization of real-world assets, rigorous risk management, and massive intergenerational wealth transfer could push trillions of dollars onto Ethereum.

Could Ethereum become one of the most strategic assets of the next decade? Why do DATs offer a smarter, higher-yield, and more transparent way to invest in Ethereum?

ChainCatcher provided the compilation and translation.

Highlights

• My focus has always been on building a bridge between traditional finance and digital assets, upholding industry standards while staying true to my principles.
• There are unique advantages to indirectly holding ETH through publicly listed equity on Nasdaq.
• It is essential to avoid fundraising when it truly dilutes shareholder equity; financing, ETH purchases, and staking should wait until multiples recover.
• The biggest risk now is no longer regulation, but rather our behavior and the types of risks we are willing to take in pursuit of returns.
• A small but focused team can achieve significant results by excelling at a few key things.
• If we can earn ETH through operating businesses, it will create a powerful growth flywheel.
• I hope that in a year and a half, we will have established one or two companies that support closed-loop transactions within the Ethereum ecosystem and generate ETH-denominated revenue, forming a virtuous cycle.
• The current global financial system is highly fragmented: stocks, bonds, and other assets are traded in specific locations, lack interoperability, and each transaction usually requires fiat currency as an intermediary.

(I) From BlackRock to Blockchain: Joseph’s Financial Journey

Chris Perkins: Can you talk about your background?

Joseph Chalom: Although I have only been CEO at SharpLink for five weeks, my story goes far beyond that. Before coming here, I spent a full twenty years at BlackRock. For the first decade or so, I was deeply involved in the expansion of BlackRock’s Aladdin fintech platform.

This experience taught me how to drive business growth and keenly identify pain points in the business ecosystem. The last five years at BlackRock were especially memorable: I led a dynamic elite team to pioneer the new field of digital assets.

I was born into an immigrant family and grew up in Washington, D.C. 31 years ago, I came to New York, and the city’s energy still drives me forward to this day.

Chris Perkins: Everyone was surprised when you came back after retiring.

Joseph Chalom: I didn’t jump straight from BlackRock to Sharplink; I officially retired and received a generous package. I originally planned to relax, but unexpectedly received a phone call.My life trajectory always seems to intersect with Joe Rubin.

We talked about mission and legacy—this may sound cliché, but who isn’t striving to leave a mark?

My focus has always been on building a bridge between traditional finance and digital assets, upholding industry standards while staying true to my principles.When I learned that a digital asset treasury project needed a leader, I was initially cautious.

But ConsenSys’s professional strength, Joe’s involvement on the board, and the project’s potential to help Sharplink stand out ultimately convinced me. Thus, my brief retirement ended.

Ideally, everyone should have a few months to reflect. But at that time, the market was at a critical turning point—not a Bitcoin vs. Ethereum debate, but rather Ethereum was entering its own era and shouldn’t be assigned the same risk profile as Bitcoin.

Frankly, I oppose irrational antagonism in the market. All types of assets have value in a portfolio. My decision to return was driven by a firm belief in Ethereum’s long-term opportunity.

(II) Why Ethereum Is the Core Bet

Chris Perkins: Can you talk about how you understand DATS and your commitment to Ethereum?

Joseph Chalom: If we believe that the financial services industry will undergo a structural transformation lasting a decade or more, and you are not seeking short-term trades or speculation but long-term investment opportunities, then the key question is: where can you have the greatest impact?

There are many ways to hold ETH. Many people choose to hold spot, store it in self-custody wallets or with custodians, and many institutions prefer ETF products.

Of course, each method has its limitations and risks. Indirectly holding ETH through publicly listed equity on Nasdaq has unique advantages.

In addition, by wrapping ETH exposure in listed company equity, you not only capture ETH’s value appreciation—its price has risen significantly in recent months—but also earn staking yields. Holding listed company equity often comes with the potential for long-term multiple appreciation. If you believe the company has growth potential, in the long run, this approach may deliver excess returns far beyond simply holding ETH.

Therefore, the logic is clear: first, be convinced of Ethereum’s long-term opportunity; only then consider which tool to use to hold it.

(III) Driving Per-Share Net Asset Growth: What Powers the Model?

Chris Perkins: In driving MNAV growth, how do you balance financial operations, timely issuance to enhance per-share equity, and truly improving fundamentals and potential yields?

Joseph Chalom: I think there are two complementary elements: first, how to finance in a value-accretive way. Most asset management companies currently raise funds mainly by issuing equity.

Issuing equity when the share price is above the net asset value of the underlying asset—using the NAV multiple to finance. At this point, enterprise value exceeds the actual value of the held Ethereum. Financing methods include market issuance, registered direct offerings, or starting from pipelines.

The key is that financing must be value-accretive; otherwise, early investors and shareholders will think you are diluting their equity just to increase ETH holdings.

If financing is efficient, ETH acquisition costs are reasonable, and staking yields are earned, the per-share value of ETH will grow over time. As long as financing increases per-share ETH value, it is accretive to shareholders.

Of course, the NAV or MNAV multiple may be high or may fall below 1, which is largely driven by market sentiment, but will revert to the mean in the long run.

Therefore, it is essential to avoid fundraising when it truly dilutes shareholder equity; financing, ETH purchases, and staking should wait until multiples recover.

Chris Perkins: So essentially, you need to monitor the average net asset value (MNAV). If MNAV is less than 1, in many cases, that’s a buying opportunity.

Joseph Chalom: ETH attracts the following types of investors:

1. Retail and long-term holders who firmly believe in Ethereum’s long-term capital appreciation potential. Even without considering staking yields, they will actively hold Ethereum through public financial companies like ours, seeking asset appreciation and passive income.

2. Some investors prefer Ethereum’s current higher volatility, especially as Bitcoin becomes more institutionalized and Ethereum’s volatility relatively increases.

3. Investors willing to participate in gamma trades via equity-linked structures, lending capital for returns.

One important reason I joined Sharplink was not only to reach consensus as a strategic partner, but also because it can attract top institutional talent to conduct business in a risk-adjusted manner.The biggest risk now is no longer regulation, but rather our behavior and the types of risks we are willing to take in pursuit of returns.

(IV) Talent and Risk: The Core Secrets to Building an Excellent Team

Chris Perkins: How do you find and attract talent with both DeFi and traditional finance (e.g., Wall Street) experience? How do you address security risks such as hacking and smart contract vulnerabilities?

Joseph Chalom: Talent is actually relatively easy. I once led the digital asset team at BlackRock, starting with a core member and gradually building a lean team—five strategists and seven engineers. Leveraging BlackRock’s brand and reputation, we raised over 100 billions of dollars in a year and a half. This shows that a small but focused team can achieve significant results by excelling at a few key things.

We only recruit the best, most mission-driven talent, and adhere to one principle: reject arrogance and negative personalities. We seek those who truly believe in the vision of long-term transformation—not just those bullish on ETH price or chasing short-term asset management, but those convinced the industry will undergo profound, lasting structural change and are willing to devote themselves to it.

Outstanding talent often comes from trusted referrals, not headhunters.

Risk is more complex. Excessive pursuit of high yields, blindly chasing every basis point out of anxiety, or measuring progress over too short a time frame—these mindsets easily lead to mistakes.

We see ourselves as being in a long-term opportunity, so we should accumulate assets steadily. The main risk comes from how we operate: for every dollar raised, we buy one dollar of ETH, eventually forming a portfolio of billions of ETH. This portfolio must be systematically managed, covering everything from the lowest-level, safest custodial staking, to liquid staking, restaking, looping strategies, and even OTC lending. Each method can introduce risk and leverage.

Risk itself can bring returns. But if you don’t understand the risks you’re taking, you shouldn’t be in this field. You must clearly identify smart contract risk, protocol risk, counterparty risk, duration risk, even convexity features in trading, and use this to build effective risk-return boundaries.

Our goal is to build the ideal portfolio—not to chase high returns every day, but to keep winning this “game” over time and truly create value for investors. Those who blindly chase returns or don’t understand their own operations may actually hinder the entire industry.

Chris Perkins: Is risk management the key to long-term success? Do you plan to drive business success through a lean team and low operating cost model?

Joseph Chalom: Looking back at my experience at BlackRock, one thing stands out: the more successful a product is, the more humble you must remain. Success is never the result of a few individuals. Our team was just the “tip of the spear” in a system backed by a strong brand reputation, distribution channels, and a trustworthy large fiduciary institution.

One of the great attractions of digital asset business is its high scalability. While you need compliance, accounting, and other professional teams to meet public company requirements, the actual fundraising team can be very lean. Whether managing 3.5 billions or 35 billions of dollars in ETH, scale itself is not the key. If your portfolio is efficient enough to handle 1 billions of dollars in assets, it should be able to scale up.

The core issue is that as scale grows, you must operate cautiously to avoid interfering with or questioning the protocol’s security and stability; at the same time, you must ensure that staked assets maintain sufficient liquidity in adverse situations.

Chris Perkins: In asset management, how do you understand and implement the principle that “treasures are not meant to lose money”?

Joseph Chalom: At BlackRock, they often said that if 65% to 70% of the assets you manage are pensions and retirement funds, there is no room for error.

Because if you make a mistake, many people will not be able to retire with dignity. This is not just a responsibility, but a heavy mission.

(V) How SharpLink Wins in Competition

Chris Perkins: In the long run, how do you plan to position yourself to address competition from ETH and other tokens?

Joseph Chalom: We can learn from Michael Saylor’s strategy, but ETH asset management is fundamentally different because it has higher yield potential.

I see competitors as worthy of support. We have great respect for teams like BM&R. Many participants from traditional institutions agree this is a long-term opportunity. There are two main ways to participate: directly holding ETH, or generating returns through ecosystem applications. We welcome this competition—the more participants, the more prosperous the industry. Ultimately, this field may be dominated by a few institutions actively accumulating ETH.

We differentiate ourselves in three main ways: First, by being the most trusted team among institutions. Although we are lean, we gather top experts and manage assets professionally and rigorously.

Second, our partnership with ConsenSys. Their expertise gives us a unique strategic advantage.

Third, operating businesses. In addition to accumulating and appreciating assets, we also run a company focused on affiliate marketing in the gaming industry to ensure compliance with SEC and Nasdaq regulations.

In the future, if we can earn ETH through operating businesses, it will create a powerful growth flywheel. Staking yields, debt compounding, plus ETH-denominated revenue will jointly accelerate the expansion of our capital reserves. This direction may not apply to all ETH asset management institutions.

(VI) Strategic Layout: M&A and Global Expansion Plans

Chris Perkins: What is your overall view and direction for future M&A strategies?

Joseph Chalom: If ETH debt grows significantly and some debt lacks liquidity, opportunities may arise. Currently, public companies in this field mainly finance through daily market plans. If stock liquidity is good, this channel can be used effectively. Some companies struggle to finance, may trade below NAV, or seek mergers, which is also an innovative way to acquire more ETH.

As the industry matures, yields may gradually rise from 0.5%-1% of ETH supply to 1.5%-2.5%. Issuing similar sister bonds in different regions may be wise—for example, targeting Asian or European markets, with the same issuance terms and shared core operating costs and infrastructure, thus covering a broader investor base.

In the future, we expect to carry out such creative M&A, though the timing is still uncertain.

I believe the industry will go through an initial phase of fragmentation before entering a consolidation period. Technology development and business evolution often follow this pattern. The stablecoin sector is also likely to see similar consolidation and M&A trends, which will be very interesting to watch.

Chris Perkins: Why do you value transparency so much? What is the main motivation for disclosing operational details daily?

Joseph Chalom: Most companies do not issue stock frequently, usually only once every few years. According to SEC regulations, companies only need to disclose the number of outstanding shares in quarterly reports.

In our industry, financing may occur daily, weekly, or at other frequencies. Therefore, to fully reflect operational status, a series of key metrics must be disclosed, such as: amount of ETH held, total funds raised, weekly ETH accumulation, whether actual ETH is held or only derivative exposure, staking ratio and yields, etc.

Every Tuesday morning, we release a press release and AK file to update investors on these data. Although some indicators may not be advantageous in the short term, transparent operations will enhance investor trust and stickiness in the long run.

Investors have the right to clearly understand the products they are buying; hiding information is unsustainable.

(VII) SharpLink’s Growth Blueprint for the Next 12 to 18 Months

Chris Perkins: What are your plans or vision for the company in the next year to year and a half?

Joseph Chalom: The top priority is to build a world-class team, but this cannot be achieved overnight. We are continuously recruiting key talent, forming a lean team of fewer than 20 people, each excelling in their field and collaborating smoothly to drive growth.

Second, continue to finance in a way that does not dilute shareholder equity, flexibly adjusting fundraising intensity according to market rhythm, with the long-term goal of continuously increasing per-share ETH concentration.

Third, actively accumulate ETH. If you believe in Ethereum’s potential, you should seize the opportunity to efficiently increase holdings at the lowest cost—even funds allocating only 5% to ETH should do so.

Fourth, deeply integrate into the ecosystem. As an Ethereum company or treasury, if you do not leverage your ETH holdings to create ecosystem value, you are derelict. With billions in ETH, we can support protocol development through lending, providing liquidity, and other means, advancing in ways beneficial to the ecosystem.

Finally, I hope that in a year and a half, we will have established one or two companies that support closed-loop transactions within the Ethereum ecosystem and generate ETH-denominated revenue, forming a virtuous cycle.

(VIII) Core Investment Insights: Key Focuses for the Future

Chris Perkins: For potential investors considering adding SBET to their investment plans, do you have any additional advice or information?

Joseph Chalom: The current traditional financial system has significant friction, low capital flow efficiency, and delayed transaction settlement—even the fastest is T+1, which brings huge settlement, counterparty, and collateral management risks. The transformation will start with stablecoins. Currently, stablecoin market cap has reached 275 billions of dollars, mainly operating on Ethereum. But the real potential lies in tokenized assets.

As Minister Bezant said, stablecoin market cap is expected to grow from the current level to 2-3 trillions of dollars in the next few years. Tokenized funds, stocks, bonds, real estate, and private equity could reach tens of trillions of dollars and will run on decentralized platforms like Ethereum.

Some are attracted by its yield potential, but more people are optimistic about its future. ETH is not only a commodity but also generates yield. As trillions of dollars in stablecoins flow into the Ethereum ecosystem, ETH will undoubtedly become a strategic asset. We must build a strategic reserve of ETH, because you need to hold a certain supply to ensure the flow of dollars and assets in the system. I can’t think of a more strategic asset than this.

More importantly, the first on-chain securities issued by Superstate and Galaxy mark one of the biggest unlocks for blockchain. Real-world assets are no longer locked in custody boxes but are directly integrated into the ecosystem through tokenization. This is a turning point that is not yet widely recognized but will profoundly change the financial landscape.

Chris Perkins: The pace of development is much faster than expected. Regulated assets have just landed; as more such assets continue to flow in, a whole new ecosystem is forming, which will greatly accelerate the development and integration of assets on Ethereum and other blockchains.

Joseph Chalom: When talking about why tokenization is needed, people often mention programmability, borderlessness, instant or atomic settlement, neutrality, and trust. But the deeper reason is that the current global financial system is highly fragmented: stocks, bonds, and other assets are traded in specific locations, lack interoperability, and each transaction usually requires fiat currency as an intermediary.

In the future, with instant settlement and composability, smart contracts will support automated trading and asset rebalancing, almost returning to the flexible exchange of “barter.” For example, why can’t the S&P 500 index be traded as a Mag 7 combination? Whether through swaps, lending, or other forms, financial instruments will become highly composable, breaking the traditional notion of “trading in specific venues.”

This will not only unlock huge economic potential by restructuring the underlying logic of value exchange, but also reshape the entire financial ecosystem. As for SBET, we plan to launch a compliant tokenized version in the near future, and will prioritize Ethereum over Solana as the underlying infrastructure.