1 00:00:00,000 --> 00:00:17,560 Welcome in to This Week in Bitcoin, episode 130. 2 00:00:17,980 --> 00:00:23,100 My name is Chris, chrislas.com, jupiterbroadcasting.com. 3 00:00:23,280 --> 00:00:24,720 Yeah, I'm coming at you on a Monday. 4 00:00:25,200 --> 00:00:29,040 I'm doing a little early this week because I'm flying to Texas and I didn't want to leave 5 00:00:29,040 --> 00:00:34,740 without an episode midweek, but it also gives me an excuse to talk about the Binance hack. 6 00:00:35,580 --> 00:00:41,200 I don't really have a lot to say, but apparently I've got something to say that other people don't. 7 00:00:41,240 --> 00:00:42,680 They seem to be missing something here. 8 00:00:43,060 --> 00:00:47,060 So instead of starting with macro this week, we're actually, we're going to start with Binance. 9 00:00:47,060 --> 00:01:01,760 you know they had to go and do the hack just after the show last week 10 00:01:01,760 --> 00:01:08,820 couldn't think of me couldn't think of my news cycle but we do have some updates as of today 11 00:01:08,820 --> 00:01:14,500 but just in case you missed what happened here is a very quick recap of the main story a black 12 00:01:14,500 --> 00:01:18,320 excellent event overnight then was the story around Bitcoin in this crypto hack. And Bitcoin 13 00:01:18,320 --> 00:01:25,360 is currently down 1.2% at 77,800. It's recovered some of the losses after falling more than 3% 14 00:01:25,360 --> 00:01:31,520 on the news that the world's largest crypto exchange was hacked. Binance says $6.3 billion 15 00:01:31,520 --> 00:01:38,040 worth of funds have been affected with $3 billion currently frozen, $3 billion worth of crypto 16 00:01:38,040 --> 00:01:41,920 frozen. Let's get more with Emily Nicole, Bloomberg's digital finance reporter who follows 17 00:01:41,920 --> 00:01:49,140 this space very closely. Emily, what do we know about the hack? So far, we don't know a ton. 18 00:01:49,520 --> 00:01:54,280 From what we've heard from Binance, there was a targeted attack made on an employee's laptop, 19 00:01:54,460 --> 00:01:58,700 which enabled the attacker to gain access to some parts of Binance's internal architecture. 20 00:01:59,180 --> 00:02:03,440 And through that, they were able to siphon a large amount of funds. Right now, the confirmed 21 00:02:03,440 --> 00:02:08,180 amount is around $6 billion worth of crypto. Making it the largest heist ever. We'll come 22 00:02:08,180 --> 00:02:13,560 back to that laptop story in a moment. You'll notice how they led with Bitcoin. They make it 23 00:02:13,560 --> 00:02:20,480 sound like a Bitcoin attack. But the attackers, they stole $1.5 billion in U.S. value of Bitcoin, 24 00:02:20,600 --> 00:02:28,320 which was 18,270 Bitcoin. But they stole $3.8 billion worth of Ethereum and a whole bunch of 25 00:02:28,320 --> 00:02:32,780 stablecoin subtokens and crap like that. But of course, it gets framed as a Bitcoin issue. 26 00:02:33,480 --> 00:02:35,380 The story about the laptop's a bit odd. 27 00:02:36,460 --> 00:02:42,920 So Binance's initial assessment pointed to a compromised employee DevOps engineer laptop as a possible entry point. 28 00:02:43,000 --> 00:02:54,200 And then pretty quickly on October 30th, Binance stated that further investigation had, quote, uncovered additional points of breach, end quote, and that the incident was, quote, a complex attack. 29 00:02:54,200 --> 00:03:04,660 They then said the attacker used, quote, self-destruct mechanisms that destroyed the tooling and traces, which, sorry, guys, is complicating the investigation. 30 00:03:05,360 --> 00:03:10,880 They also noted that on Ethereum, EIP 7702 delegation was used. 31 00:03:11,820 --> 00:03:15,540 Sorry, I don't know what that is, but sounds like something complicated on Ethereum. 32 00:03:15,740 --> 00:03:19,360 And that was used to obtain execution approval over a hot wallet. 33 00:03:19,360 --> 00:03:26,300 So I guess in that way, Binance says it, quote, did not pass through our normal approval controls, end quote. 34 00:03:27,100 --> 00:03:30,140 A few days later, like they said, withdrawals did get turned back on. 35 00:03:30,200 --> 00:03:32,720 They started trying to cover customer funds for what they could. 36 00:03:33,080 --> 00:03:37,660 And of course, the stablecoin companies tried to lock up as many of the funds that they could. 37 00:03:38,720 --> 00:03:39,600 Welcome back. 38 00:03:39,780 --> 00:03:47,580 Binance says it has resumed withdrawals following the record theft of $6.3 billion in token assets earlier this week. 39 00:03:48,060 --> 00:03:50,860 Withdrawals have resumed for Bitcoin and other cryptocurrencies. 40 00:03:51,620 --> 00:03:55,380 Binance says it has covered up to 90% of the assets stolen. 41 00:03:55,600 --> 00:03:57,560 These have not been recovered from the hacker. 42 00:03:58,040 --> 00:04:02,860 Instead, Binance is tapping its Secure Assets Fund for users and its corporate treasury. 43 00:04:03,360 --> 00:04:08,860 It also said it will replace the remaining 10% of token assets through market and over-the-counter channels. 44 00:04:08,860 --> 00:04:12,660 The FBI says North Korea is responsible for the hack. 45 00:04:13,100 --> 00:04:15,460 In a statement Saturday, it said it, quote, observed, 46 00:04:15,460 --> 00:04:21,580 Trader Trader, actors converting stolen assets primarily into Ethereum. 47 00:04:22,200 --> 00:04:26,260 Trader Trader is an elite North Korean hacking unit well known to the FBI. 48 00:04:26,640 --> 00:04:27,020 Oh, yes. 49 00:04:27,600 --> 00:04:31,820 And of course, when Binance did open with the withdrawal doors, 50 00:04:31,920 --> 00:04:34,220 there were a fair amount who ran towards the exit. 51 00:04:34,220 --> 00:04:37,460 More than $6 billion in tokens left Binance-linked wallets 52 00:04:37,460 --> 00:04:40,260 in the 24 hours after the exchange reopened withdrawals 53 00:04:40,260 --> 00:04:41,920 following last week's record hack. 54 00:04:41,920 --> 00:04:47,340 That's about 3.6% of the $171 billion Binance held before the attack. 55 00:04:47,720 --> 00:04:51,780 TFi Llama still tracks roughly $129 billion sitting in those wallets. 56 00:04:52,020 --> 00:04:56,840 Binance says it's already replenished roughly 95% of the assets stolen on October 29. 57 00:04:57,380 --> 00:05:00,120 And for reasons I don't seemingly fully understand, 58 00:05:00,700 --> 00:05:05,700 the ETF holders reacted very strongly and dumped, dumped, dumped. 59 00:05:05,940 --> 00:05:10,200 U.S. spot Bitcoin ETFs just shed $643 million in a single day, 60 00:05:10,200 --> 00:05:16,620 the biggest outflow since June, and enough to wipe out 63.6% of their entire year-to-date inflows. 61 00:05:17,060 --> 00:05:24,420 BlackRock's IBIT led the exodus with $234 million out, followed by Fidelity's FBTC at $201 million. 62 00:05:24,720 --> 00:05:27,1000 Analysts tie the rush to the exits directly to the Binance hack. 63 00:05:28,280 --> 00:05:32,640 Derives Nick Forster said traditional investors moved fast to protect against further losses. 64 00:05:32,640 --> 00:05:37,100 I mean, in a way, with the ETF sales like that, a Binance hack like this, 65 00:05:37,100 --> 00:05:41,840 I was pretty impressed Bitcoin held up the way it did and has so far. 66 00:05:42,000 --> 00:05:43,720 I mean, we're not out of the woods yet. 67 00:05:43,840 --> 00:05:47,140 But I've been wondering why this hasn't quite felt like FTX. 68 00:05:47,560 --> 00:05:51,020 When FTX blew up, we had a 25% drop in Bitcoin. 69 00:05:51,360 --> 00:05:52,400 There was blood in the streets. 70 00:05:53,100 --> 00:06:00,420 And there also doesn't seem to be the same call by Bitcoiners to get your funds off exchanges. 71 00:06:00,420 --> 00:06:15,760 In fact, when you consider the total number of users and the total amount of money that Binance has under control, really only a small portion of their users are actually leaving. 72 00:06:16,280 --> 00:06:21,920 In fact, some of the on-chain data I looked at suggests that users are depositing money today. 73 00:06:22,340 --> 00:06:24,420 They're adding to their Binance accounts. 74 00:06:25,460 --> 00:06:28,840 This is the opposite effect of running from the exchanges. 75 00:06:28,840 --> 00:06:32,000 Some people are actually running back in while the building's still smoking. 76 00:06:32,900 --> 00:06:35,560 So Scott on the Daily Wolf says the reason for this is simple. 77 00:06:36,000 --> 00:06:38,340 And there's a reason why this is nothing like FTX. 78 00:06:38,520 --> 00:06:42,420 And it's because they are uniquely positioned as the largest exchange in the world. 79 00:06:42,540 --> 00:06:46,860 Now, it's driving me nuts because I'm seeing false equivalencies with FTX. 80 00:06:47,020 --> 00:06:55,300 Now, if you want to compare similarities, they both had massive withdrawal flight, six, I think it was six, seven billions for FTX. 81 00:06:55,300 --> 00:06:59,780 The difference, it happened at midterm elections, interestingly, exactly four years ago. 82 00:07:00,400 --> 00:07:06,020 But that's where the similarities really end because FTX was a fraud that had no money. 83 00:07:07,000 --> 00:07:10,960 And Binance is a successful company with a massive balance sheet that has the money. 84 00:07:11,300 --> 00:07:18,020 So part of this obviously coming from their Safu fund, which still is the most laughable name in customer protection. 85 00:07:18,680 --> 00:07:22,000 Your assets are Safu, the Safu fund. 86 00:07:22,000 --> 00:07:24,440 But the rest is coming from Binance themselves. 87 00:07:24,440 --> 00:07:30,460 And they could have covered, you know, a hack, probably many multiples larger than this if they had to. 88 00:07:30,560 --> 00:07:37,600 So I'm not surprised that there's people depositing and that the withdrawals have been somewhat muted relative to how much assets they hold. 89 00:07:37,600 --> 00:07:46,900 Because when people immediately see that you're going to make them whole, no matter what happens, they're going to continue to have confidence in the exchange. 90 00:07:47,060 --> 00:07:49,920 And we've seen a similar thing happen with the liquid network. 91 00:07:49,920 --> 00:07:54,480 People are leaving, but not in like a bank run style. 92 00:07:54,960 --> 00:07:57,680 And there's many that are staying on the liquid network. 93 00:07:57,860 --> 00:08:04,220 So I agree with Scott there to an extent, but I actually think there's a larger trend at play here. 94 00:08:04,340 --> 00:08:05,500 And I'm going to come back to that. 95 00:08:05,760 --> 00:08:08,440 But first, I felt a little called out by Scott. 96 00:08:08,800 --> 00:08:11,560 That you're going to make them whole no matter what happens. 97 00:08:12,020 --> 00:08:15,860 They're going to continue to have confidence in the exchange. 98 00:08:15,860 --> 00:08:22,020 Now, interestingly, there's also been a massive debate of nonsensical conspiracy theory on 99 00:08:22,020 --> 00:08:26,100 X that I'm sure you've seen at this point because we all know that fake news goes viral 100 00:08:26,100 --> 00:08:29,140 nine times faster than real news. 101 00:08:29,140 --> 00:08:43,288 But many people seem to believe that Binance did this to themselves because they have an FTX hole in their balance sheet that nobody knows about because of bad investments and such The FBI and basically every law enforcement agency on the 102 00:08:43,288 --> 00:08:50,028 planet have agreed and said this was North Korea. The Lazarus Group and more specifically 103 00:08:50,028 --> 00:08:55,168 Trader Trader. That's T-R-A-D-E-R-T-R-A-I-T-O-R. Trader Trader. Oh yeah, we know. Very clever. 104 00:08:55,728 --> 00:09:01,348 Trader Trader Group from North Korea. North Korea is behind this. It is confirmed. So please, 105 00:09:01,348 --> 00:09:05,608 please stop with the nonsensical conspiracy theories until there's actual evidence. 106 00:09:07,168 --> 00:09:12,528 I hate to be a conspiracy theorist. I think that's kind of a slur in some ways. It's just, 107 00:09:12,608 --> 00:09:18,228 this doesn't sit easy with me. We're talking $6 billion in funds that got messed around with, 108 00:09:18,368 --> 00:09:23,888 not all of it were successfully taken. And when we have a nice tidy answer to a crime like this 109 00:09:23,888 --> 00:09:27,068 so quickly, I don't like it. 110 00:09:27,748 --> 00:09:34,788 Real attribution in cybercrime takes genuinely long, hard hours. 111 00:09:34,948 --> 00:09:37,888 It takes more than just a few hours to figure that out. 112 00:09:38,208 --> 00:09:39,548 And think about it for a second. 113 00:09:39,548 --> 00:09:44,768 So these hackers, these North Korean hackers are so elite that they can pull off the biggest 114 00:09:44,768 --> 00:09:50,688 heist in history, not just a crypto heist, but the biggest heist period in history using 115 00:09:50,688 --> 00:09:54,088 quote, complex methods that quote, self-destruct. 116 00:09:54,448 --> 00:09:55,528 That's pretty advanced. 117 00:09:55,908 --> 00:09:58,008 I'm not even sure how I would make a program self-destruct. 118 00:09:58,268 --> 00:09:59,768 And I've used computers my entire life. 119 00:10:01,188 --> 00:10:02,788 But they can't cover their tracks. 120 00:10:05,128 --> 00:10:07,348 They can't make themselves look like somebody else. 121 00:10:07,568 --> 00:10:09,168 They can do all this stuff. 122 00:10:10,328 --> 00:10:12,728 But they don't know that stable coins are going to get seized. 123 00:10:12,728 --> 00:10:13,668 They don't track. 124 00:10:13,828 --> 00:10:14,328 They don't trace. 125 00:10:14,508 --> 00:10:15,448 They don't cover their traces. 126 00:10:15,688 --> 00:10:18,608 I'm not trying to fry a bunch of conspiracy bacon here. 127 00:10:18,608 --> 00:10:24,668 It just seems odd. And when the numbers involved are this staggering. 128 00:10:25,848 --> 00:10:31,708 And the story about the vague laptop thing then changes into vague 40 hacking. 129 00:10:32,168 --> 00:10:41,168 And we're all just supposed to accept that when there's all this money on the line and a massive screw up by the largest crypto firm or exchange in the world. 130 00:10:42,828 --> 00:10:47,268 And their founder, CZ, happens to have ties to the Trump White House as well. 131 00:10:47,268 --> 00:10:52,468 So there's probably lots of ways to reach out and get messaging taken care of is all I'm saying. 132 00:10:55,408 --> 00:10:56,028 I don't know. 133 00:10:56,688 --> 00:10:58,108 I'll tell you what the issue is. 134 00:10:58,808 --> 00:11:00,448 First of all, I don't feel like we have enough evidence. 135 00:11:00,588 --> 00:11:01,508 Just all happens a little soon. 136 00:11:01,828 --> 00:11:03,748 I'm just the type that's like let's just wait and see. 137 00:11:03,848 --> 00:11:04,728 Wait for more information. 138 00:11:04,968 --> 00:11:06,408 Don't form an opinion completely yet. 139 00:11:06,988 --> 00:11:09,048 But I default to skeptic, I admit. 140 00:11:09,988 --> 00:11:15,588 But I think it made me realize that this is touching on a trust problem that we have now. 141 00:11:15,588 --> 00:11:17,868 we've all been 142 00:11:17,868 --> 00:11:19,868 you know I think 143 00:11:19,868 --> 00:11:22,088 a little messed with by the recent 144 00:11:22,088 --> 00:11:23,888 quote unquote cyber attacks 145 00:11:23,888 --> 00:11:25,328 it really started with the cold card stuff 146 00:11:25,328 --> 00:11:26,328 this year's been rough 147 00:11:26,328 --> 00:11:27,428 this has sucked 148 00:11:27,428 --> 00:11:30,068 and now it's a bit ironic that Bitcoiners 149 00:11:30,068 --> 00:11:33,308 are having a hard time even trusting the tools 150 00:11:33,308 --> 00:11:34,448 that they've depended on forever 151 00:11:34,448 --> 00:11:37,308 and you know as predicted 152 00:11:37,308 --> 00:11:39,268 the cold card was just the starting line 153 00:11:39,268 --> 00:11:40,428 of these types of attacks 154 00:11:40,428 --> 00:11:43,268 we've seen more hardware wallet attacks 155 00:11:43,268 --> 00:11:45,468 we've seen embedded devices in hardware wallets 156 00:11:45,968 --> 00:11:47,668 BTC pay server has gotten popped. 157 00:11:47,888 --> 00:11:50,188 I'll have an update on that after the boost. 158 00:11:51,148 --> 00:11:52,488 Now, Binance has gotten hacked, right? 159 00:11:52,528 --> 00:11:53,708 The Liquid Network has gotten hacked. 160 00:11:54,708 --> 00:11:56,828 And I think we all know this isn't over yet. 161 00:11:56,828 --> 00:12:00,788 So most of us, I think we expect this to last for a few more years. 162 00:12:02,028 --> 00:12:06,788 And that, I think, has a lot of us just really questioning what we can trust at all. 163 00:12:07,648 --> 00:12:09,228 And so people are buying ETFs. 164 00:12:09,328 --> 00:12:14,388 They're going to Binance exchanges as they just sort of want to hunker down. 165 00:12:14,388 --> 00:12:24,508 You know, as James Lopp put it, and James Lopp was on BMTV recently, AI compresses the security clock. And I think that's a clever way to put it. 166 00:12:24,508 --> 00:12:33,168 And I'd love to zoom out for a minute and just talk about this macro trend you're talking about of increased hacks across the whole Internet, really. 167 00:12:33,628 --> 00:12:37,088 The cybersecurity pandemic, as a lot of folks are calling it. 168 00:12:37,088 --> 00:12:50,068 We see a lot of different takes from cybersecurity experts and researchers, even some from these frontier labs, indicating that various degrees of panic or fear are warranted at this time. 169 00:12:50,068 --> 00:12:58,208 Some saying that this is going to be very temporary and eventually developers will have the tools in short order here to make sure none of this even gets to production. 170 00:12:58,888 --> 00:13:02,948 Others are saying this is like the early innings of COVID-19 and we're going to shut down the Internet. 171 00:13:03,708 --> 00:13:05,488 What is actually warranted? 172 00:13:06,028 --> 00:13:12,128 And in the medium term and also the long term, does this change the value proposition of Bitcoin? 173 00:13:12,128 --> 00:13:26,268 Is this going to change the way that people, maybe traditional cybersecurity workers or bankers who are seeing their software being hacked, is it going to change the way that they're viewing an asset in a technology like Bitcoin? 174 00:13:26,268 --> 00:13:35,488 um mostly i think that what this is going to change is that uh you know before security was 175 00:13:35,488 --> 00:13:40,908 often an afterthought like even in a lot of big businesses you would do like one big security audit 176 00:13:40,908 --> 00:13:47,828 per year and that would keep you in compliance with various frameworks and now if you want to 177 00:13:47,828 --> 00:13:56,068 be secure it needs to be real time it needs to be a part of your software development life cycle so 178 00:13:56,068 --> 00:14:12,108 So that basically means that as you are writing the code, you need to have these latest competent security researcher LLMs looking at the code and trying to break it before you even release it out the front door. 179 00:14:12,108 --> 00:14:22,488 Because you know and you should expect that the bad actors are going to be out there using those same tools to knock on your front door and try to find the holes in it. 180 00:14:22,488 --> 00:14:26,608 So really, it's the same story as ever, right? 181 00:14:26,708 --> 00:14:28,868 Security is always a cat and mouse game. 182 00:14:28,988 --> 00:14:32,468 It's just now the timeframes are much more compressed 183 00:14:32,468 --> 00:14:37,368 and you need to be secure as you are deploying your software, 184 00:14:37,768 --> 00:14:42,488 not some point later because you're hoping that you have some lag time 185 00:14:42,488 --> 00:14:44,508 before a researcher is going to come along 186 00:14:44,508 --> 00:14:48,608 and discover whatever vulnerabilities you accidentally let through the gate. 187 00:14:49,528 --> 00:14:50,908 Linux is dealing with this. 188 00:14:50,908 --> 00:14:56,048 Linux is definitely dealing with this, and I think Bitcoiners are going to still be dealing with this for a while. 189 00:14:56,308 --> 00:14:59,288 Only the paranoid and the informed are going to survive. 190 00:15:00,228 --> 00:15:03,788 I maintain I think we're still going to be better off, and we're going to survive. 191 00:15:03,908 --> 00:15:06,528 More of us will survive than the traditional institutions. 192 00:15:06,828 --> 00:15:10,248 But it's going to be rough, and they're not ready for it. 193 00:15:10,508 --> 00:15:12,748 Speaking of which, let's do some macro. 194 00:15:12,748 --> 00:15:23,228 First up in macro, we need to go over a few numbers, about 40 trillion of them. 195 00:15:23,228 --> 00:15:29,148 Out of this mountain of debt that we've got. And the Wall Street Journal reports that our U.S. 196 00:15:29,568 --> 00:15:35,248 national debt hit 100 percent of GDP for the fiscal year that just ended, September 30th. 197 00:15:35,248 --> 00:15:39,948 This is kind of it's the first time that's happened since 1946. 198 00:15:40,448 --> 00:15:46,408 So this is wartime level debt that we're staring at last. 199 00:15:46,648 --> 00:15:50,668 And the debt currently standing at forty point six trillion dollars. 200 00:15:50,828 --> 00:16:00,268 And it comes as if there's a projection from the CBO Congressional Budget Office that the Treasury will spend 20 trillion dollars in interest alone on the national debt over the next decade. 201 00:16:00,268 --> 00:16:09,228 If you look at the previous year, I believe it was like $1.36 trillion in interest on the debt, and it was almost $1.99 trillion. 202 00:16:09,468 --> 00:16:12,828 All right, these numbers are coming fast and quick, so I want to back up here. 203 00:16:12,948 --> 00:16:19,248 She says projected interest spending on the national debt over the next decade will be $20 trillion. 204 00:16:20,268 --> 00:16:27,648 So not paying down the principal, just going to the interest charge, will be $20 trillion smackaroos. 205 00:16:27,748 --> 00:16:28,408 That's massive. 206 00:16:28,408 --> 00:16:29,168 Next decade. 207 00:16:29,168 --> 00:16:39,688 If you look at the previous year, I believe it was like $1.36 trillion in interest on the debt, and it was almost $1.99 trillion in a deficit. 208 00:16:40,008 --> 00:16:41,628 But you grow your way out of it. 209 00:16:41,708 --> 00:16:46,228 That is the only way that we can tackle this horde of borrowing. 210 00:16:46,788 --> 00:16:47,968 You grow your way out of it. 211 00:16:48,068 --> 00:16:48,888 You hear that often. 212 00:16:49,248 --> 00:16:50,548 You've got to grow your way out of it. 213 00:16:50,548 --> 00:17:01,288 I think when you hear that, you could have a little word replacement program in your head, a little macro that executes and realize it's a shorthand way of saying we have no other choice. 214 00:17:01,868 --> 00:17:04,048 We have to grow our way out of this. 215 00:17:04,868 --> 00:17:08,708 And the more we pump this thing, the less painful it's going to be for asset holders. 216 00:17:09,488 --> 00:17:20,936 And you know I been calling the I been talking about the I guess Well I been saying it the unwind of the A trade It was a little early on that And it been it been it been maintaining that trajectory 217 00:17:21,376 --> 00:17:28,756 And I've been trying to stress that this matters for Bitcoiners, because when you're 40.6 trillion dollars in debt here in the U.S. 218 00:17:28,756 --> 00:17:31,436 And of course, we know that's a massive issue across the West. 219 00:17:31,436 --> 00:17:44,416 When you have weaker GDP growth, that means you go from what's kind of a manageable getting by burden into a heavier drag on the middle class and living standards get even worse. 220 00:17:45,176 --> 00:17:56,056 And where we're at right now, the margin of error is so small that if GDP starts to back off, those pressures start to escalate very, very quickly. 221 00:17:56,056 --> 00:18:02,476 And that does impact all kinds of things from the housing market to the grocery store. 222 00:18:02,816 --> 00:18:08,096 And yes, the AI trade, which is still quite responsible for a big portion of that GDP. 223 00:18:08,416 --> 00:18:17,896 And it seems like your buddies over at OpenAI are starting to smell the way things are going and adapting as fast as they can. 224 00:18:18,496 --> 00:18:19,896 OK, Leslie, thank you very much. 225 00:18:20,236 --> 00:18:21,436 Keep us posted on all that. 226 00:18:21,436 --> 00:18:22,356 Now let's get to OpenAI. 227 00:18:22,356 --> 00:18:27,356 The company is scaling back its fundraising ambitions as investors scrutinize the AI boom. 228 00:18:27,496 --> 00:18:29,076 Kate Rooney joins us with more. Kate. 229 00:18:30,536 --> 00:18:37,216 Hey, Sarah. So we are hearing that OpenAI is now dialing back its fundraising target amid some of this tech market volatility. 230 00:18:37,396 --> 00:18:43,016 You guys were talking about sources now telling me the chat GPT maker is looking to raise up to $20 billion. 231 00:18:43,336 --> 00:18:48,696 So that is a change that is down from an earlier target that we reported, which was up to $30 billion. 232 00:18:48,696 --> 00:18:54,076 I'm hearing that they are still looking at a $1.25 trillion valuation. 233 00:18:54,336 --> 00:18:56,016 That is before this new capital. 234 00:18:56,596 --> 00:18:57,816 So that's known as pre-money. 235 00:18:57,936 --> 00:18:59,376 But it is still a jump in valuation. 236 00:18:59,536 --> 00:19:03,336 The last pre-money valuation was around $750 billion. 237 00:19:03,556 --> 00:19:08,096 We did report previously that CO2 and the UAE are going to be leading this round, or sovereign 238 00:19:08,096 --> 00:19:09,096 wealth from the UAE. 239 00:19:09,196 --> 00:19:10,636 The round has not closed yet. 240 00:19:10,676 --> 00:19:15,316 A person directly familiar with these deal talks tells me that the numbers could change. 241 00:19:15,436 --> 00:19:16,516 So we'll keep you posted. 242 00:19:16,516 --> 00:19:21,896 The FT first reported the lower target, saying that some investors have cut their allocations. 243 00:19:22,056 --> 00:19:26,956 OpenAI, if you remember, last raised $122 billion back in March. 244 00:19:27,376 --> 00:19:36,396 Sources have described this as an opportunistic bridge round ahead of a financing event, an IPO, of course, in 2027, which is what we're hearing on their timing. 245 00:19:36,796 --> 00:19:41,896 One last dip at the money before things get really bad or before they have to IPO. 246 00:19:41,896 --> 00:19:42,536 We'll see. 247 00:19:42,536 --> 00:19:51,196 Adam Johnson, though, he runs Bullseye American Ingenuity Fund, and he has traditionally been very, very bullish on the AI trade. 248 00:19:51,756 --> 00:19:54,056 But I think he's been rattled recently. 249 00:19:54,276 --> 00:19:58,556 He says, OK, I think there was a bubble, but maybe it just popped. 250 00:19:58,876 --> 00:20:05,996 You know, that's what we're what we're learning with the way all these data centers and the capacity around them is structured. 251 00:20:05,996 --> 00:20:13,516 You're putting up a lot of money over 18 months, and you're going to get a payout over 12 to 15 years. 252 00:20:14,016 --> 00:20:15,756 Now, there are ways to account for that. 253 00:20:15,956 --> 00:20:22,256 You discount back to the present and all that, which is what all the analysts do to try to make sure that the numbers foot. 254 00:20:22,796 --> 00:20:29,716 But it also depends upon being able to execute and that all your assumptions are correct. 255 00:20:29,716 --> 00:20:36,036 And that's what the market has been repricing over the past six, seven, eight weeks as all these stocks have sold off. 256 00:20:36,256 --> 00:20:39,696 Hmm, they say they can do it. Can they really do it? Let's run the numbers. Run them again. Run them again, right? 257 00:20:39,816 --> 00:20:44,036 That's what everybody's been doing. Well, maybe we ought to shave it a little more. I shave a little more. 258 00:20:44,216 --> 00:20:51,876 But I think what has happened is that all these stocks have been taken down so far and so fast that you sort of say, hang on. 259 00:20:52,216 --> 00:20:57,516 Wait a minute. Time out. Should we really take Google down 14%? Probably not. 260 00:20:58,036 --> 00:20:58,316 Okay. 261 00:20:58,596 --> 00:21:03,276 Core weave we took, and I own it, you know, from, what, 250 down to 50? 262 00:21:03,756 --> 00:21:04,556 Well, that too. 263 00:21:05,076 --> 00:21:05,356 Really? 264 00:21:05,536 --> 00:21:06,216 I mean, really? 265 00:21:06,336 --> 00:21:07,576 Should we really take it down that much? 266 00:21:07,676 --> 00:21:08,256 Probably not. 267 00:21:09,036 --> 00:21:12,316 So, pendulums always swing too far, and then they swing back. 268 00:21:12,316 --> 00:21:21,336 My hope is that the pendulum last week went as far, you know, that was the most the rubber band, to use another metaphor, is going to get stretched. 269 00:21:21,456 --> 00:21:22,156 That's my hope. 270 00:21:22,296 --> 00:21:23,056 We'll see if I'm right. 271 00:21:23,056 --> 00:21:31,556 But there's a sense that it's I think a lot of people have talked a lot about the chance that the bubble, so to speak, is going to pop and we're going to get a recession. 272 00:21:31,696 --> 00:21:32,196 It already did. 273 00:21:32,796 --> 00:21:33,356 You don't need. 274 00:21:33,456 --> 00:21:33,736 The bubble popped. 275 00:21:33,836 --> 00:21:33,996 Right. 276 00:21:34,136 --> 00:21:35,076 And you don't need a recession. 277 00:21:39,236 --> 00:21:41,396 We'll see if he's right about that, if it's popped or not. 278 00:21:41,756 --> 00:21:45,396 I mean, I do think there's genuine demand, but you hear some of the numbers they're kicking around. 279 00:21:45,676 --> 00:21:47,316 The financing is pretty crazy. 280 00:21:47,796 --> 00:21:49,136 So we will see indeed. 281 00:21:49,596 --> 00:21:53,196 It seems Jordy Visser is thinking along the similar lines, though, as Adam Johnson. 282 00:21:53,716 --> 00:21:56,796 He picked up on a story that I was surprised didn't get more play. 283 00:21:56,876 --> 00:22:01,036 Maybe I noticed it just because Microsoft is local to my area. 284 00:22:01,176 --> 00:22:03,096 But to me, this seemed like a pretty big signal. 285 00:22:03,676 --> 00:22:06,856 The Microsoft News does not get enough press. 286 00:22:07,096 --> 00:22:10,376 60,000 people is 27% of their employees. 287 00:22:10,496 --> 00:22:10,896 27. 288 00:22:11,816 --> 00:22:12,256 Now. 289 00:22:12,416 --> 00:22:12,916 Is that a lot? 290 00:22:12,916 --> 00:22:21,616 Well, to put it in perspective, I mean, when you have 223,000 people and you're saying, okay, 60,000, you can take a buyout. 291 00:22:21,836 --> 00:22:24,576 Now, they obviously don't expect all of them to do it. 292 00:22:24,596 --> 00:22:27,056 They did this once before, but they did it with 8,000. 293 00:22:28,776 --> 00:22:30,236 60,000 is a big number. 294 00:22:31,076 --> 00:22:39,616 And what do you think those 60,000 people that have been offered the buyout, are they like feel secure in their job going forward? 295 00:22:39,616 --> 00:22:43,516 or was this a message that this is our hope? 296 00:22:43,696 --> 00:22:46,116 Now you said, are they using this for money? 297 00:22:46,196 --> 00:22:48,756 I mean, I've run a business. 298 00:22:49,056 --> 00:22:51,236 I know what micro, like you can go through their compensation. 299 00:22:51,416 --> 00:22:53,676 So let's assume it's $400,000 a person 300 00:22:53,676 --> 00:22:56,116 when you add in healthcare at Microsoft. 301 00:22:56,756 --> 00:22:57,716 That's $24 billion. 302 00:22:58,796 --> 00:23:00,556 Not 24 billion for one year. 303 00:23:00,656 --> 00:23:02,936 That's every year going forward 304 00:23:02,936 --> 00:23:05,296 unless they go hire more people. 305 00:23:05,676 --> 00:23:07,736 That number, if they all took it, 306 00:23:07,736 --> 00:23:15,376 would take them back to 2020 levels. Their revenue has grown, will have grown 70% if they just meet 307 00:23:15,376 --> 00:23:21,496 numbers into next year. So revenue per employee has gone through the roof. So this has a lot of 308 00:23:21,496 --> 00:23:25,616 issues to the government. And this is why it's positive Bitcoin. This is why I wrote a substack 309 00:23:25,616 --> 00:23:29,396 about this whole thing, comparing what Microsoft was doing to what was happening in France, 310 00:23:29,396 --> 00:23:33,256 where the common thread is going to be affordability. Because on the one side, 311 00:23:33,256 --> 00:23:36,576 What do employees making $400,000 have to pay in taxes? 312 00:23:37,076 --> 00:23:37,276 Yeah. 313 00:23:37,696 --> 00:23:40,236 50%, 50 plus, depending on where they live. 314 00:23:41,036 --> 00:23:43,556 What does Microsoft pay on corporate taxes? 315 00:23:43,956 --> 00:23:47,676 There's an arbitrage here that's becoming a bigger story to the government because if 316 00:23:47,676 --> 00:23:53,176 Microsoft doesn't have to pay the same amount, you're losing receipts from this if people 317 00:23:53,176 --> 00:23:56,356 don't get jobs or if they end up taking less of a job, whatever the case is. 318 00:23:56,776 --> 00:24:00,996 I think this is becoming a labor versus capital story that is much, much bigger than people 319 00:24:00,996 --> 00:24:04,836 realize because we're just entering the productivity boom. 320 00:24:05,096 --> 00:24:10,816 That's the other message that Microsoft is saying is they believe they can do this buyout 321 00:24:10,816 --> 00:24:15,836 at five to six or six to seven times the last one. 322 00:24:16,756 --> 00:24:20,636 What is that saying about their expectations about what AI is going to enable their business 323 00:24:20,636 --> 00:24:21,576 to be like in the future? 324 00:24:22,496 --> 00:24:26,776 Now, I'm not so sure that AI is the entire story to these buyouts. 325 00:24:26,776 --> 00:24:36,916 But if Geordi's right and Microsoft is laying people off because they're seeing AI gains and efficiencies at those levels, he's touching on that Luke Groman theory. 326 00:24:37,016 --> 00:24:39,556 And Luke has been developing this theory for about a year. 327 00:24:40,556 --> 00:24:44,076 And I think maybe he'd probably call it the who services the debt theory. 328 00:24:44,216 --> 00:24:46,296 I'm not sure if he has a name for it. 329 00:24:46,616 --> 00:24:51,936 But he was just on the macroeconomics podcast that I'll link in the show notes. 330 00:24:51,936 --> 00:24:54,836 I listen to it every week and I'm drawing a blank on the name. 331 00:24:55,356 --> 00:24:56,636 But I'll link to it in the podcast. 332 00:24:56,776 --> 00:24:58,256 or in the show notes for this podcast. 333 00:24:58,416 --> 00:24:59,296 And he was just on there. 334 00:24:59,756 --> 00:25:05,876 And he kind of laid out the theory of what he's explaining is if Geordi's right, 335 00:25:07,136 --> 00:25:10,656 if the AI companies are truly going to start, you know, 336 00:25:10,796 --> 00:25:15,876 getting these gains where these models are so good that for $100 a month, 337 00:25:15,916 --> 00:25:17,156 you can replace two employees. 338 00:25:17,276 --> 00:25:19,756 And if you spend this amount, you can replace 50,000 employees, 339 00:25:19,876 --> 00:25:21,456 according to your Microsoft or whatever. 340 00:25:21,556 --> 00:25:23,676 The 60,000 was the buyout offer, which is not going to be that. 341 00:25:23,676 --> 00:25:30,316 But the theory that Geordi is pushing, putting forward is that the AI gains are going to be so good. 342 00:25:30,756 --> 00:25:35,876 The models will be so good that the gains for all the companies that use them will be so good that they can lay these people off. 343 00:25:36,176 --> 00:25:39,416 And then the tax receipts for the government could start going down. 344 00:25:39,936 --> 00:25:43,916 This is where Luke takes over and kind of takes it all the way. 345 00:25:45,036 --> 00:25:56,804 The dynamic that there is 19 trillion dollars in consumer debt outstanding mortgages credit cards auto loans primarily 346 00:25:57,884 --> 00:26:06,564 And that means, so 5% of that number is call it a trillion dollars for easy math. 347 00:26:07,444 --> 00:26:14,144 So if you assume that AI is going to really displace a lot of white collar jobs, 348 00:26:14,144 --> 00:26:18,704 And I think there's been a pretty robust debate around that. 349 00:26:18,864 --> 00:26:20,564 I think it's foolish to think they won't. 350 00:26:20,744 --> 00:26:23,144 But this, by the way, is Macro Voices 556. 351 00:26:24,224 --> 00:26:31,204 I also, not to interrupt Luke here, but I'm curious to know if you think AI is going to take jobs or create jobs. 352 00:26:32,204 --> 00:26:37,444 I think my personal take would be it initially probably slows down hiring. 353 00:26:38,724 --> 00:26:40,384 Companies add new things. 354 00:26:40,704 --> 00:26:43,484 They start doing new products and then they need more people. 355 00:26:44,444 --> 00:26:56,484 The AI doesn't help with the human stuff, all of the stuff that the human stuff to do, but also the task management, the prioritization, kind of the collaborative thinking, the creative thinking, the human touch. 356 00:26:56,744 --> 00:26:58,044 You're still going to need people to do that. 357 00:26:58,844 --> 00:27:01,124 There's been a pretty robust debate around that. 358 00:27:01,124 --> 00:27:21,204 I think it's foolish to think they won't, but there's been a robust debate about it. But I think in the last literally two weeks, the side saying that AI is going to create a lot of white collar job loss has started to strike some serious body blows to the side that everything is going to be fine for white collar jobs. 359 00:27:21,204 --> 00:27:26,424 you had Kroger layoff, talk about laying off, I think 37% of their corporate workforce. 360 00:27:26,984 --> 00:27:31,124 Kroger's business model hasn't changed in a long time. They sell food, right? So this is AI related. 361 00:27:31,884 --> 00:27:36,224 American Express last week came out and said, we are firing 5% of workers because of AI. 362 00:27:36,484 --> 00:27:40,244 Barclays came out last week, said we're firing 5% of workers because of AI. And then of course, 363 00:27:40,244 --> 00:27:49,224 yesterday, Microsoft is buying out 27% of their workforce. Yikes. And the reason I bring up these 364 00:27:49,224 --> 00:27:53,064 numbers, and this is the credit side that people just, the second derivative credit side that no 365 00:27:53,064 --> 00:27:57,344 one is talking about. And I think they're not talking about it because there's nothing to say. 366 00:27:57,704 --> 00:28:03,924 There's nothing to say, which is all of these people getting laid off. They're not going to 367 00:28:03,924 --> 00:28:10,264 find another job, not easily, and probably not at the same wage because the AI is hitting everybody 368 00:28:10,264 --> 00:28:14,664 all at the same time in finance and tech in particular, but white collar more broadly. 369 00:28:14,664 --> 00:28:31,144 And if you just kind of play that out over several quarters, that $19 trillion in consumer loans, let's pretend 5% of those default as a result of AI, just sometime in the next two years, three years, 5%, it's roughly a trillion dollars. 370 00:28:31,144 --> 00:28:40,324 So by way of comparison, the entire equity capital base of the United States banking system, according to the Fed, is $2.6 trillion. 371 00:28:40,684 --> 00:28:56,124 So every 5% default rate increase on consumer debt as a result of AI unemployment or deflation in wages is equal to 40%, 40% of the total equity base of the United States banking system. 372 00:28:57,344 --> 00:28:58,784 You see the problem here? 373 00:28:58,784 --> 00:29:28,564 And that's the side that no one's talking about yet. And I think they need to be. If 40% of the equity capital base. So what are banks going to do if AI starts to create this joblessness? They can stop making loans. They can, you know, again, take this as a grain of salt. I'm a tourist, but they can stop making loans. They can sell treasuries that they're holding for as high quality liquid asset to raise capital. But oops, now you're going to have another seller of treasuries to go alongside foreigners, to go alongside Scott Besson. 374 00:29:28,564 --> 00:29:34,864 etc. They can issue equity, which the market isn't going to love if banks start issuing trillions of 375 00:29:34,864 --> 00:29:40,384 dollars of equity because, oh, by the way, that's somebody else who's got to issue capital alongside 376 00:29:40,384 --> 00:29:47,524 Scott Best and alongside AI. And now the banks, that's not good for risk. Or you slow the economy 377 00:29:47,524 --> 00:29:52,044 down a whole bunch. But none of those are good outcomes. That doesn't work for our debt position. 378 00:29:52,144 --> 00:29:57,004 We have to grow out of our debt. When we slow down, we don't grow out of our debt. And so I think 379 00:29:57,004 --> 00:30:11,384 And it's almost like, to me, the last two weeks, particularly around this Microsoft news, this Microsoft news, I think, was like, we're going to need a bigger boat moment for the employment argument around AI. 380 00:30:12,164 --> 00:30:14,344 It's not that I disagree with Luke. 381 00:30:15,124 --> 00:30:17,784 I just don't take it all the way to 11 like he does. 382 00:30:17,784 --> 00:30:26,804 Like, I suspect there's more to an offer to buy out 60,000 employees or, you know, give them basically an exit package. 383 00:30:27,084 --> 00:30:28,084 A buyout's a funny term. 384 00:30:29,404 --> 00:30:32,204 I think it's probably more to that story than just AI. 385 00:30:32,864 --> 00:30:35,144 He also cited Kroger as an example. 386 00:30:36,224 --> 00:30:37,924 Kroger's been struggling for years. 387 00:30:38,824 --> 00:30:40,264 Go look it up. 388 00:30:40,924 --> 00:30:45,364 They've had a lot of problems and nothing about their recent layoff suggests it's due to AI efficiency. 389 00:30:45,364 --> 00:30:48,264 It has to do with the fact that they're collapsing as a company. 390 00:30:50,304 --> 00:30:58,084 So like he kind of like – and then like these other companies that he cited that are – that I looked it up. 391 00:30:58,184 --> 00:31:02,024 They are saying that it is due to AI efficiency gains, the other companies he mentioned. 392 00:31:03,584 --> 00:31:06,384 But I also don't take that at face value anymore. 393 00:31:07,544 --> 00:31:11,944 I know that makes me I guess a skeptic but I am just – I just don't trust these people anymore. 394 00:31:12,644 --> 00:31:16,164 And I think they're willing to say whatever is good for their ticker price. 395 00:31:17,504 --> 00:31:20,464 So I tend to fall more in the middle of Luke's analysis. 396 00:31:21,204 --> 00:31:22,144 Things are tight. 397 00:31:22,304 --> 00:31:23,924 We are walking a very hard line. 398 00:31:24,604 --> 00:31:26,944 And a reduction in GDP would be devastating. 399 00:31:28,144 --> 00:31:38,704 But what I think, I don't know, I'm sure Luke understands this, but we might just be seeing a repricing in the market as the market learns that the deal has changed. 400 00:31:38,704 --> 00:31:44,064 The Meg 7 has been called the Magnificent 7 because they have been a cash cow. 401 00:31:44,584 --> 00:31:46,984 Stock buybacks, cash machines. 402 00:31:47,704 --> 00:31:48,764 I mean look at Apple. 403 00:31:48,884 --> 00:31:56,544 Apple is that still today with their services business and they just make a ton of money because they didn't go crazy on the AI investment stuff. 404 00:31:57,084 --> 00:32:04,924 But Google and Microsoft and Amazon and Tesla and everybody else in that 7 category and especially the Meg 5 has. 405 00:32:04,924 --> 00:32:08,864 And so the deal has changed for Wall Street investors. 406 00:32:09,324 --> 00:32:12,344 These have gone from cash rich to cash poor companies. 407 00:32:12,524 --> 00:32:19,624 They've gone from sitting on piles of cash to spending it and even raising debt for the next hundred years in the case of Google. 408 00:32:20,944 --> 00:32:22,324 The deal has changed. 409 00:32:22,784 --> 00:32:24,464 We are in the middle of midterms. 410 00:32:24,624 --> 00:32:25,784 We're smack dab right now. 411 00:32:25,844 --> 00:32:28,824 We're at the peak and they're repricing everything. 412 00:32:29,464 --> 00:32:34,144 And so the cash flow situation, it's flipped in the last few years for these tech companies. 413 00:32:34,704 --> 00:32:39,684 And, you know, as Lynn Alden points out, it's just a more nuanced issue than perhaps where Luke is going. 414 00:32:39,784 --> 00:32:44,064 Like I kind of there with him for a bit, but then maybe he just takes it a little too far. 415 00:32:44,224 --> 00:32:47,984 So I'll play this clip from Lynn when she was on with Natalie Brunel. 416 00:32:48,344 --> 00:32:51,104 I think it really depends on what part of the industry you're talking about. 417 00:32:51,204 --> 00:32:54,064 So I've been more in the bullish camp on semiconductors. 418 00:32:55,064 --> 00:33:01,484 I'm not very bullish on the frontier shops, like the models themselves. 419 00:33:01,484 --> 00:33:19,204 I think that their valuations are hard to justify and their economic moats are thin, which is, I think, part of why they are kind of aiming for regulatory moats to kind of augment a pretty weaker economic moat. 420 00:33:19,984 --> 00:33:25,464 So when you're talking a trillion plus valuation, there's a lot of risk there. 421 00:33:25,464 --> 00:33:31,184 um uh the hyperscalers that would then put somewhere in the middle because unlike the 422 00:33:31,184 --> 00:33:36,444 models i mean that you know they have these other business lines uh they do have economic moats 423 00:33:36,444 --> 00:33:40,704 because hardware and scales just it's very expensive and you know they all have their 424 00:33:40,704 --> 00:33:45,664 other businesses that have uh economic moats and so it's mostly a matter of how much are they 425 00:33:45,664 --> 00:33:52,784 over committing um or not uh and like i used to be bullish on alphabet for example 426 00:33:52,784 --> 00:33:57,624 uh that was kind of a contrarian position at the time because the view was like who's going to 427 00:33:57,624 --> 00:34:03,704 search when when you know you can you can just ask ai now um but i did kind of a deep dive into 428 00:34:03,704 --> 00:34:08,204 that and i had the view that alphabet was interesting and of course they did become 429 00:34:08,204 --> 00:34:14,404 part of an ai play themselves um but like for example i am less bullish on them after they had 430 00:34:14,404 --> 00:34:19,824 a big run-up and because they they're so much of their cash flow now is is has to be reinvested 431 00:34:19,824 --> 00:34:26,144 So it's not that I think the hyperscalers crash per se, but I think they're less stellar 432 00:34:26,144 --> 00:34:28,264 investments compared to what they were doing. 433 00:34:28,297 --> 00:34:36,417 in the 2010s and the early 2020s, which was basically super profitable growth, very low 434 00:34:36,417 --> 00:34:41,137 reinvestment growth, and then they could plow all that money into share buybacks or 435 00:34:41,137 --> 00:34:42,197 forge this balance sheet. 436 00:34:42,197 --> 00:34:47,777 But now that they have to just aggressively invest, it kind of diminishes them. 437 00:34:49,417 --> 00:34:55,737 Okay, so we're right smack dab in the perfect moment for you to make a prediction, a ridiculous 438 00:34:55,737 --> 00:34:58,977 prediction and then find out almost immediately if you were right or wrong. 439 00:34:59,417 --> 00:35:05,077 So boosted to tell me if you think we are at the bottom of the AI trade turbulence or 440 00:35:05,077 --> 00:35:06,697 if the unwind continues from here. 441 00:35:07,517 --> 00:35:09,797 Will things turn around after the midterms? 442 00:35:09,897 --> 00:35:13,717 Perhaps I'll play some stats on that after the boost. 443 00:35:14,117 --> 00:35:17,777 Or are we going for more a collapse of the AI trade? 444 00:35:17,857 --> 00:35:21,917 The tightening credit, the borrowing costs are going up, yada, yada, yada. 445 00:35:22,417 --> 00:35:25,617 Coreweave this, Oracle that, Bubble Pop this, that. 446 00:35:25,737 --> 00:35:29,237 What do you think? Let me know. Boost.JupiterBroadcasting.com. 447 00:35:29,677 --> 00:35:31,957 I mean, come on. This is just for fun internet points. 448 00:35:32,477 --> 00:35:37,157 Not a big deal, but I would like to know what you think and where this is going from here. 449 00:35:37,197 --> 00:35:39,157 And why not? Put it in the Boost. 450 00:35:39,757 --> 00:35:42,237 We're going to find out. We're going to find out pretty quick. 451 00:35:55,737 --> 00:36:25,717 We'll see you next time. 452 00:36:25,737 --> 00:36:31,617 lending and buying sats river is great the bitcoin well is all about self-custody you guys they're 453 00:36:31,617 --> 00:36:37,397 the best of the best no official relation as the kids say we're not shipped as my kids would say 454 00:36:37,397 --> 00:36:45,257 but i do like the the products and i and i use them not you full card so disappointed in you full 455 00:36:45,257 --> 00:36:45,517 card 456 00:36:55,737 --> 00:37:10,637 And now it is time for Le Boost. 457 00:37:10,637 --> 00:37:11,857 Oh, it is indeed. 458 00:37:11,997 --> 00:37:18,677 And we're going to start out with our baller booster, who is J-Cube, coming in with a sharp 77,000 sats. 459 00:37:18,777 --> 00:37:20,137 Hey, rich lobster! 460 00:37:20,137 --> 00:37:27,697 JQ Brides, I use the Gemini card and I pay the balance every two weeks. 461 00:37:27,797 --> 00:37:30,757 I use River and I keep cash balance at River to get the interest sets. 462 00:37:31,177 --> 00:37:33,977 I also have strike count and honestly, I'm having trouble picking. 463 00:37:34,217 --> 00:37:35,457 What's your take, River or strike? 464 00:37:35,537 --> 00:37:36,737 They seem neck and neck. 465 00:37:38,117 --> 00:37:38,957 I agree. 466 00:37:39,297 --> 00:37:45,177 These are the two competitors and I like River's tech stack more and I like their interface 467 00:37:45,177 --> 00:37:46,977 a lot and I like the people behind River. 468 00:37:47,117 --> 00:37:49,797 I also like strike a lot and I like strike's interface a lot. 469 00:37:50,137 --> 00:37:56,097 I don't like their tech stack as much, but I don't have any hands on like reasons where it's bit me. 470 00:37:56,917 --> 00:38:01,837 My understanding is that River is an elixir shop and that Strike is a .NET shop on the back end. 471 00:38:02,177 --> 00:38:05,617 That's my personal bias sneaking out there because it's never been an issue for Strike. 472 00:38:06,077 --> 00:38:10,297 I think Strike has the leg up on overall features at the moment, right? 473 00:38:10,297 --> 00:38:20,337 Because not only does Strike have fantastic lightning support, of course, but they have great prices for stacking DCA, especially if you do it through bill pay. 474 00:38:20,597 --> 00:38:22,097 I mean through your check. 475 00:38:22,537 --> 00:38:23,197 River does as well. 476 00:38:23,617 --> 00:38:29,077 But I think maybe where Strike kind of has the leg up is the lending stuff that River is just not willing to get into. 477 00:38:30,097 --> 00:38:36,237 And Strike seems to be doing it right and responsibly, kind of setting the example of how this can be done. 478 00:38:36,377 --> 00:38:39,077 And their interface is fantastic for managing that stuff as well. 479 00:38:39,077 --> 00:38:45,637 And then you add the recent stacks feature so you can have sub wallets that can also DCA. 480 00:38:46,197 --> 00:38:47,497 That's really powerful. 481 00:38:48,937 --> 00:38:53,597 I would love to see River get neck and neck on some of that kind of stuff because I love both companies a lot. 482 00:38:54,097 --> 00:38:56,277 And in a way, we're kind of spoiled. 483 00:38:56,577 --> 00:39:00,437 We have some great options and we're lucky because just the two of those are just fantastic. 484 00:39:01,477 --> 00:39:02,077 Good question. 485 00:39:02,317 --> 00:39:06,077 And JQ, it's interesting that you pay off the Gemini card every two weeks instead of once a month. 486 00:39:06,077 --> 00:39:10,337 and I'm wondering if you use River at all for the bill pay. 487 00:39:10,497 --> 00:39:13,337 Like, are you using the cash balance on River to pay the Gemini card? 488 00:39:15,197 --> 00:39:18,077 Are you using the Gemini card for everything 489 00:39:18,077 --> 00:39:19,537 and that's why you're paying it off every two weeks? 490 00:39:19,617 --> 00:39:22,817 I'd love a little, you know, extra operational details if you're willing to share it 491 00:39:22,817 --> 00:39:24,997 because I'm trying to model how I might do it. 492 00:39:25,617 --> 00:39:27,957 Thank you, sir. Appreciate you being our baller sat booster. 493 00:39:28,397 --> 00:39:30,337 Obi comes in with 21,000 sats. 494 00:39:32,917 --> 00:39:34,037 That's so nice to hear from Obi. 495 00:39:34,037 --> 00:39:35,877 I'm not worried about quantum at all. 496 00:39:36,077 --> 00:39:38,217 Quite possible it's not achieved in our lifetime. 497 00:39:38,757 --> 00:39:41,497 If it is, Satoshi has a S-load of wallets. 498 00:39:41,837 --> 00:39:43,677 Lol, he'll probably be the first to move. 499 00:39:44,377 --> 00:39:45,337 Would that be funny? 500 00:39:45,617 --> 00:39:46,577 I would love to see that. 501 00:39:46,997 --> 00:39:47,777 Love to see the reaction. 502 00:39:47,897 --> 00:39:49,977 I'd love to be doing TWIB if that ever happens. 503 00:39:52,097 --> 00:39:54,157 Yeah, all of it so far is theory, right? 504 00:39:54,197 --> 00:39:55,237 There's no hardware yet. 505 00:39:55,317 --> 00:39:56,497 So you might be onto something there. 506 00:39:56,617 --> 00:39:57,077 You might be. 507 00:39:57,157 --> 00:39:58,197 I'm going to go with that, OB. 508 00:39:58,317 --> 00:40:00,317 Even though I don't know if I believe it, I'm going to go with it. 509 00:40:00,397 --> 00:40:00,817 Thank you, sir. 510 00:40:00,857 --> 00:40:01,597 It's nice to hear from you. 511 00:40:02,097 --> 00:40:04,017 Ace Ackerman's back with a row of ducks. 512 00:40:04,017 --> 00:40:06,237 That's 2,222 Satoshis. 513 00:40:07,317 --> 00:40:12,077 The quantum narrative is likely to be the cause of decline in Bitcoin's price at the end of the next bull run. 514 00:40:12,397 --> 00:40:15,177 I'd like to think we could help the FUD awareness, but nobody listens. 515 00:40:15,957 --> 00:40:17,357 I don't know if you're right here, Ace. 516 00:40:18,337 --> 00:40:20,357 But I really like this theory. 517 00:40:21,137 --> 00:40:36,894 Because there an old adage that the cause of the next crash is always apparent at the beginning of the bull run I probably messing up I think there like a more succinct phrase but that the general idea is that you could 518 00:40:36,894 --> 00:40:41,394 kind of suss out what's likely going to cause the crash if you had the means, right? 519 00:40:41,434 --> 00:40:44,034 Like going back to FTX, I suppose, or whatever. 520 00:40:44,294 --> 00:40:46,894 But so in a way, you can see that, right? 521 00:40:46,894 --> 00:40:51,594 Like we get a good bull run going for a while, then some quantum advancement, who knows, right? 522 00:40:51,594 --> 00:40:53,554 Who knows, Ace, because I still don't think it'd be that soon. 523 00:40:53,754 --> 00:40:56,354 But I'd also take like a 10 year bull run. 524 00:40:56,554 --> 00:40:59,314 If then we got a quantum scare at the end of that, I'd make that trade. 525 00:41:00,654 --> 00:41:01,534 Thank you, Ace. 526 00:41:02,034 --> 00:41:02,814 Appreciate you. 527 00:41:04,154 --> 00:41:07,354 I'm going to say Jace Neville comes in with five thousand sats. 528 00:41:07,394 --> 00:41:08,794 Coming in hot with the boost. 529 00:41:09,894 --> 00:41:14,374 Listening to your banking troubles, I wanted to direct you to Sequence, get sequence.io. 530 00:41:14,614 --> 00:41:19,014 I moved from Fold after they announced their reserve and decided to keep my DCA with River. 531 00:41:19,414 --> 00:41:23,534 However, Sequence has allowed me to look at my money the way that I've always wanted to. 532 00:41:23,814 --> 00:41:28,454 Move it around and get rules for what is needed for each different thing, and then they're on the one map. 533 00:41:28,754 --> 00:41:35,414 They also have an MCP, an API for connecting agents, which is very useful to convert our budgeting spreadsheets into rules. 534 00:41:36,014 --> 00:41:36,254 Okay. 535 00:41:37,934 --> 00:41:41,694 I didn't think I was going to say this on air, but that is actually one of the things I'm considering. 536 00:41:41,854 --> 00:41:43,534 I run my own private Hermes agents. 537 00:41:43,534 --> 00:41:45,274 I don't necessarily have my own private model. 538 00:41:46,054 --> 00:41:46,534 Anyways. 539 00:41:46,534 --> 00:41:51,994 Anyways, an API and MCP is literally a deciding factor for me. 540 00:41:52,914 --> 00:41:54,254 And this is very interesting. 541 00:41:54,634 --> 00:42:00,154 It looks like it has almost like you connect blocks and diagrams, like a routing system. 542 00:42:00,214 --> 00:42:00,954 This is really cool. 543 00:42:01,794 --> 00:42:06,074 I don't know if this is exactly the kind of way I like to visualize it because I just plan to have an agent do it all. 544 00:42:08,494 --> 00:42:08,854 Interesting. 545 00:42:10,014 --> 00:42:10,794 Different cards. 546 00:42:10,914 --> 00:42:12,294 Very good recommendation, I will say. 547 00:42:12,334 --> 00:42:12,794 Very good. 548 00:42:13,634 --> 00:42:15,074 That is getsequence.io. 549 00:42:15,614 --> 00:42:16,294 Thank you, Jace. 550 00:42:16,294 --> 00:42:17,054 Appreciate that. 551 00:42:17,514 --> 00:42:20,394 Hey, Mary, Oscar is here with 10,000 sats. 552 00:42:22,574 --> 00:42:24,514 Mary just says, great updates. 553 00:42:24,774 --> 00:42:25,294 Thank you, Oscar. 554 00:42:25,614 --> 00:42:26,694 Appreciate you very much. 555 00:42:26,774 --> 00:42:27,374 Good to hear from you. 556 00:42:28,194 --> 00:42:31,054 Satoshi-san is here with 5,021 Satoshis. 557 00:42:31,314 --> 00:42:33,174 You make me want to be a better man. 558 00:42:33,434 --> 00:42:37,274 I just realized that Bitcoin is the only asset that everybody can afford to buy. 559 00:42:37,454 --> 00:42:38,134 Yeah, you got it. 560 00:42:38,234 --> 00:42:40,014 You're doing very well. 561 00:42:40,174 --> 00:42:45,074 You can buy one little sat at a time, you know, in theory, or 10 sats at a time. 562 00:42:45,554 --> 00:42:46,734 You can't do that with real estate. 563 00:42:46,834 --> 00:42:50,014 Even once they tokenize it, you're not going to be able – it's not a bare instrument. 564 00:42:50,014 --> 00:42:58,254 You're not going to be able to put it in a cold wallet and you physically custody it or at least the key. 565 00:42:59,234 --> 00:43:05,734 Even with tokenized real estate where maybe you could buy 100 acres at a time or something like that, they're not going to be able to give you that or they won't. 566 00:43:05,814 --> 00:43:07,074 They might be able to but they won't. 567 00:43:08,234 --> 00:43:11,854 Bitcoin will remain the key standout asset there. 568 00:43:12,134 --> 00:43:12,854 Thank you, Satoshi-san. 569 00:43:13,094 --> 00:43:13,654 Appreciate you. 570 00:43:13,654 --> 00:43:21,714 nakamoto 6102 is here with 3,500 satoshis i could see the quantum narrative having a short-term 571 00:43:21,714 --> 00:43:25,974 impact on price but i'm not worried about in the long term i hope you are right i do 572 00:43:25,974 --> 00:43:32,534 i really hope it is just a short-term thing thank you sir your inner child is here with 2,130 satoshis 573 00:43:32,534 --> 00:43:42,614 2030 or i'm sorry 2130 equals 2,000 plus 130 for the episode oh i see okay please bring vance crow 574 00:43:42,614 --> 00:43:47,994 back onto Twib or onto Twib to talk about how the Bitcoin community can communicate with the outside 575 00:43:47,994 --> 00:43:52,034 on the quantum scare versus continuing to fall incentives. You know, I don't really do interviews 576 00:43:52,034 --> 00:43:56,234 on the news pod, but I have thought about every now and then doing pre-record specials. This might 577 00:43:56,234 --> 00:44:01,674 have been a good week for it. There was some news going on, you know, doing a pre-record special when 578 00:44:01,674 --> 00:44:06,354 I'm on the road. I don't know if you know this, but I'm going to Texas. Pretty excited. I'm going 579 00:44:06,354 --> 00:44:10,074 to Austin. Meetup.com slash Jupiter Broadcast. I'm going to have a lunch meetup on a Saturday. 580 00:44:10,874 --> 00:44:11,574 Thank you very much. 581 00:44:11,914 --> 00:44:12,774 Appreciate it, inner child. 582 00:44:13,294 --> 00:44:15,394 Magnolia Mayhem is here with 3,000 sats. 583 00:44:16,694 --> 00:44:17,754 Woo, cheap sats. 584 00:44:18,254 --> 00:44:18,694 Yeehaw. 585 00:44:18,874 --> 00:44:20,594 You're doing very well. 586 00:44:20,674 --> 00:44:20,894 Yes. 587 00:44:20,994 --> 00:44:22,194 Just pump the brakes right there. 588 00:44:22,394 --> 00:44:23,434 No, no, keep going, I say. 589 00:44:23,674 --> 00:44:24,094 Thank you. 590 00:44:24,194 --> 00:44:24,994 Nice to hear from you, Mayhem. 591 00:44:25,774 --> 00:44:28,614 Colorado Snows here with 6,000 satushers. 592 00:44:28,614 --> 00:44:29,834 Good news, everyone. 593 00:44:30,694 --> 00:44:33,054 Maybe it's just the way my algorithm gives it to me, 594 00:44:33,394 --> 00:44:38,014 but I rarely hear the word quantum without Bitcoin being mentioned. 595 00:44:38,014 --> 00:44:45,274 It seems like Bitcoin is such a small portion of the issue of the problem and quantum computers that they would end up creating. 596 00:44:45,434 --> 00:44:49,994 I do worry the narrative has these two tied together as it could slow adoption for such a great asset. 597 00:44:53,394 --> 00:44:56,454 I also think I see it tied together more often than it should be. 598 00:44:56,634 --> 00:44:58,194 I'm surprised we don't see it. 599 00:44:58,674 --> 00:45:01,674 There's a lot of things that use elliptic curve cryptography. 600 00:45:02,394 --> 00:45:03,454 And so I'm surprised. 601 00:45:03,794 --> 00:45:06,594 I have to believe it's because Bitcoin sells. 602 00:45:07,434 --> 00:45:09,994 There's a theory out there that Bitcoin is a brand. 603 00:45:10,694 --> 00:45:15,434 And if you can associate your story with that brand name, you get more clicks. 604 00:45:15,814 --> 00:45:18,754 And you kind of see it play out in the tech industry with Apple. 605 00:45:19,334 --> 00:45:28,534 If there's any reason they could put Elon or Tesla or Apple in the name or Zuckerberg, if they can put a name in there, they'll go for it. 606 00:45:28,534 --> 00:45:32,714 Even if it's kind of like Zuckerberg's meta says, right? 607 00:45:32,874 --> 00:45:35,134 It's just kind of a branding thing, I think, Snow. 608 00:45:35,134 --> 00:45:39,074 But I don't like it because it does create that association. 609 00:45:40,214 --> 00:45:40,774 Thank you, sir. 610 00:45:40,874 --> 00:45:41,354 Appreciate you. 611 00:45:42,214 --> 00:45:44,254 KBog is here with a free member boost. 612 00:45:44,874 --> 00:45:52,214 I evaluated and ran Fold Plus trial early on and found that their rewards were confusing and the ACH payments weren't supported by all my services. 613 00:45:52,334 --> 00:45:53,474 I did have a couple of that, too. 614 00:45:54,114 --> 00:46:00,234 Then I moved to River and I've been happy with their service, especially if you can set and forget the auto stack at a level you're comfortable with. 615 00:46:00,494 --> 00:46:00,934 Oh, OK. 616 00:46:01,034 --> 00:46:02,754 So this is a thing that I need to know. 617 00:46:02,754 --> 00:46:08,134 the ACH like payment stuff's been better with river huh than it was with fold that's my that's 618 00:46:08,134 --> 00:46:12,774 the implication i'm taking from this uh rewards on cash back credit card is not a taxable event 619 00:46:12,774 --> 00:46:20,974 typically they are higher percentages than crypto rewards you could have a process of taking those 620 00:46:20,974 --> 00:46:32,311 proceeds and purchasing bitcoin or holding the cash in river and then earn bitcoin interest on that cash get creative i do feel like that kind of what I realizing KMog is that I got some options here It just 621 00:46:32,311 --> 00:46:36,631 how I put it all together. And I want to put it together where I'm making some passive Bitcoin. 622 00:46:37,991 --> 00:46:43,411 You know, that's my thing. The more Bitcoin I can make, the better, because I don't want the 623 00:46:43,411 --> 00:46:48,431 fiat. I mean, I need the fiat to pay the bills, but I'd like to be able to passively stack too. 624 00:46:48,431 --> 00:47:03,951 So that's good information. And if anybody out there has experience with River or Strike with their ACH services or any of the systems you're using, that's a key element because you can get on there and they don't always work with all of the banks or credit cards or utility bills or whatever it is. 625 00:47:04,251 --> 00:47:12,811 So I'd love to hear that if you want to boost that in, boost.jupiterbroadcasting.com, of course, and as well as I want to hear your thoughts on the AI trade. 626 00:47:12,811 --> 00:47:35,811 Let's wrap it all up. This was a shorter recording window. So if you didn't hear your boost, that's just because I'm recording on a Monday instead of a Wednesday. And you got in late. Or I got in early. I'm not sure. But you know what to say about the early bird. So thank you, everybody, that stream sat 17 of you stream sets and collectively you stacked thirty three thousand two hundred and fifty six Satoshis. 627 00:47:42,811 --> 00:47:51,551 And when you bring it all together, this week we stacked 174,336 Satoshis. 628 00:47:55,891 --> 00:47:59,291 Not our best week ever, but I'm not complaining on a quick week. 629 00:47:59,391 --> 00:48:00,711 This is a value for value podcast. 630 00:48:00,931 --> 00:48:01,891 There's no advertising. 631 00:48:02,471 --> 00:48:03,651 My alignment is to you. 632 00:48:03,771 --> 00:48:04,971 You are my customer. 633 00:48:05,411 --> 00:48:09,891 If you got value from this podcast and you want to keep it going, boost.jupiterbroadcasting.com. 634 00:48:09,891 --> 00:48:14,631 you want to put your support on autopilot you go over to jupiter.party you sign up over there and 635 00:48:14,631 --> 00:48:19,871 then you also get a free member boost once an episode which is pretty great and you can send 636 00:48:19,871 --> 00:48:24,951 your support directly at boost.jupiterbroadcasting.com thank you so much everybody who supported this 637 00:48:24,951 --> 00:48:31,251 short episode now we do have a few things i want to get to including a btc server pay server update 638 00:48:31,251 --> 00:48:32,331 so let's do that 639 00:48:32,331 --> 00:48:49,451 on november 1st we received reports of a bitcoin and of litecoin being stolen from hot wallets on 640 00:48:49,451 --> 00:48:56,631 btc pay server they write on the btc server log blog i can do this i promise a hot wallet stores 641 00:48:56,631 --> 00:49:00,831 the keys needed to spend the funds on the server of course and their investigation found that these 642 00:49:00,831 --> 00:49:07,091 attacks targeted servers running BTC Pay Server 2.4.1 that was released on July 23rd, 643 00:49:07,111 --> 00:49:11,831 2026 or earlier. There's several different methods that are being used to exploit it. 644 00:49:11,831 --> 00:49:19,271 If you're already on version 2.4.2 or later, which is the current version, then you are likely 645 00:49:19,271 --> 00:49:26,011 just fine. And so far, they have seen no impact on those versions. If you are running 2.4.1 or 646 00:49:26,011 --> 00:49:32,291 earlier. You need to listen to this. The folks at BTC Pay Server strongly recommend moving to an 647 00:49:32,291 --> 00:49:38,471 entirely new server with a new wallet after sweeping any remaining funds from the existing 648 00:49:38,471 --> 00:49:47,231 hot wallet. Do not reuse the system, they say. Wow. Also, it's worth noting that if you run 649 00:49:47,231 --> 00:49:54,851 an LND server, a Lightning server on Linux, there was a massive TCP flaw that was announced this 650 00:49:54,851 --> 00:50:02,411 week. And LND is written in Go and takes advantage of multi-path TCP, which is one of the scenarios 651 00:50:02,411 --> 00:50:08,551 in which this vulnerability is the most critical. So the default LND setup could be the most 652 00:50:08,551 --> 00:50:14,391 vulnerable setup for this new Linux CVE that came out for the TCP stack. So you need to update your 653 00:50:14,391 --> 00:50:21,071 Linux kernel. It is not an LND issue. You need to update your Linux kernel. I want to talk about 654 00:50:21,071 --> 00:50:25,951 BitAir for a moment. This is something I haven't brought up on the show, but they made some news 655 00:50:25,951 --> 00:50:32,071 today, and I think it's worth talking about. So this is a company called HeatBit, I believe, 656 00:50:32,991 --> 00:50:39,331 and they have their BitAir miner. It is a heater, like a room heater, that also mines Bitcoin. 657 00:50:39,811 --> 00:50:44,471 And today they are open sourcing the hardware design of it. Now, your boy here actually ordered 658 00:50:44,471 --> 00:50:49,391 one of these quite a while ago, and I was told that it would be shipping to me around late 659 00:50:49,391 --> 00:50:54,111 September. So far, it has not shipped. So I have not been able to do a review for you. 660 00:50:55,031 --> 00:50:59,011 But I did learn that my information was leaked and that it was my account information was 661 00:50:59,011 --> 00:51:03,091 compromised. So that's wonderful. I'm still very optimistic, though. I think this is a fantastic 662 00:51:03,091 --> 00:51:09,011 use. If you're already going to run an electric heater, why not run one that mines Satoshi's? 663 00:51:09,351 --> 00:51:13,111 So what they did today is open source the PCB and some of the components. They write, 664 00:51:13,171 --> 00:51:16,191 we believe that Bitcoin mining can reach far more people when it's simple, 665 00:51:16,191 --> 00:51:17,431 useful and accessible. 666 00:51:17,851 --> 00:51:19,151 The hardware is now open. 667 00:51:19,271 --> 00:51:20,951 The software they say will open soon. 668 00:51:21,271 --> 00:51:22,971 They're taking extra time for security audits 669 00:51:22,971 --> 00:51:24,411 given so much AI hacking lately. 670 00:51:25,451 --> 00:51:25,751 Okay. 671 00:51:26,391 --> 00:51:27,951 Looking forward to building more features 672 00:51:27,951 --> 00:51:30,211 that can be ported across the open source 673 00:51:30,211 --> 00:51:30,891 mining devices. 674 00:51:31,111 --> 00:51:32,091 More to come, they add. 675 00:51:33,251 --> 00:51:34,931 I, you know, I'm a little cynical 676 00:51:34,931 --> 00:51:36,531 because they told me in September 677 00:51:36,531 --> 00:51:38,171 it'd be shipping very soon and it hasn't shipped. 678 00:51:38,491 --> 00:51:40,171 But I'm also very excited 679 00:51:40,171 --> 00:51:42,611 because I am somebody that uses 680 00:51:42,611 --> 00:51:43,551 electric space heaters 681 00:51:43,551 --> 00:51:45,471 and I've always hated that they're just sitting there 682 00:51:45,471 --> 00:51:49,951 wasting, wasting energy, not doing anything productive with that energy other than, you 683 00:51:49,951 --> 00:51:53,071 know, keeping me comfortable, which I suppose is something. 684 00:51:53,771 --> 00:51:59,731 The HeatBit Air mainboard carries a single Bitmain BM1370 Bitcoin mining ASIC and an 685 00:51:59,731 --> 00:52:01,091 ESP32S3. 686 00:52:01,731 --> 00:52:05,091 And the heat from the ASICs is used by an air purifier. 687 00:52:05,971 --> 00:52:07,791 So that's the design of their unit. 688 00:52:08,071 --> 00:52:11,331 And it looks like a nice tubular unit with a fan on the top. 689 00:52:11,511 --> 00:52:13,191 I like the design and look of it a lot. 690 00:52:13,191 --> 00:52:15,571 it looks very modern and clean 691 00:52:15,571 --> 00:52:17,411 and compact and I hope they ship it 692 00:52:17,411 --> 00:52:19,651 and I hope I get to give you a full review of it 693 00:52:19,651 --> 00:52:33,227 because I will use the heck out of it I can tell you that so there you go that the HeatBit and they announced that bit air is going open source And I think this could be fantastic Now it is you know it midterm season and I didn 694 00:52:33,227 --> 00:52:37,307 want to talk about it much in the show because it doesn't really impact us, except for it does 695 00:52:37,307 --> 00:52:45,047 impact the way the market invests, which does impact the spot price at least. And it seems like 696 00:52:45,047 --> 00:52:50,467 we could end up with potentially a little bounce after the midterms, depending on how things go. 697 00:52:51,047 --> 00:52:55,587 And Adam is back with stats that have held up since World War II. 698 00:52:56,027 --> 00:52:59,788 I don't normally get into this kind of stuff, but why not this one time? 699 00:52:59,947 --> 00:53:00,807 We're talking stats. 700 00:53:00,847 --> 00:53:01,647 I'll give you guys a couple. 701 00:53:01,647 --> 00:53:13,067 So if you go back to World War II, you look at the various compositions of who controls Washington. 702 00:53:13,067 --> 00:53:23,867 If you have a Republican in the White House and you have Democrats in the House and Democrats in the Senate, that is on average a 9 percent return. 703 00:53:23,987 --> 00:53:26,727 You say, oh, 9 percent. Not bad. But hang on. 704 00:53:27,007 --> 00:53:34,627 If you have Republicans in all three, which is what we've had, you have a 16 percent average return. 705 00:53:34,687 --> 00:53:39,047 You say, wow, that's great. I hope they just keep it as is. 706 00:53:39,047 --> 00:53:46,767 Well, actually, if you have a Republican in the White House, you have Republicans controlling the Senate and Democrats in the House. 707 00:53:47,187 --> 00:53:49,367 You have, on average, an 18 percent. 708 00:53:49,607 --> 00:53:49,987 Even better. 709 00:53:50,107 --> 00:53:51,787 That is the best combination out there. 710 00:53:52,087 --> 00:54:00,767 So arguably, even if you're a Republican, you should kind of want the House to flip, at least for your portfolio, because, again, that's a very powerful concept. 711 00:54:00,987 --> 00:54:03,487 And you talk about, well, you both talked about gridlock. 712 00:54:03,847 --> 00:54:05,967 That's actually the perfect combination of gridlock. 713 00:54:05,967 --> 00:54:11,527 If it's Democrat, Democrat, and then White House, nothing gets done. 714 00:54:11,627 --> 00:54:14,007 And you need to get stuff done, as you point out, right? 715 00:54:14,027 --> 00:54:14,987 We've got some important bills. 716 00:54:15,367 --> 00:54:21,867 But if you have Democrats in the House, which is where spending originates, they tend to spend more. 717 00:54:22,267 --> 00:54:26,168 And then the Senate, OK, Republican, they're going to keep a check on that. 718 00:54:26,227 --> 00:54:29,027 But still, you know, there's going to be more spending, which is stimulus. 719 00:54:29,288 --> 00:54:30,707 That's a very good combo. 720 00:54:31,147 --> 00:54:32,087 So, yeah. 721 00:54:32,707 --> 00:54:35,428 And by the way, that scenario is very, very possible. 722 00:54:35,428 --> 00:54:38,187 Stay tuned and find out. 723 00:55:05,427 --> 00:55:07,187 305 Satoshis to $1. 724 00:55:07,647 --> 00:55:12,627 We're down 39.3% from our all-time high 392 days ago. 725 00:55:12,627 --> 00:55:15,627 You complete and utter maniac. 726 00:55:15,967 --> 00:55:16,908 That's incredible. 727 00:55:17,627 --> 00:55:18,427 Look at you go. 728 00:55:19,027 --> 00:55:22,887 Estimated difficulty change this time is going to be a downward adjustment of 2.6%. 729 00:55:22,887 --> 00:55:26,807 Not too crazy after a pretty big upward adjustment. 730 00:55:27,367 --> 00:55:31,627 And there are only 18,493 nodes on the network. 731 00:55:32,267 --> 00:55:33,047 Where'd they all go? 732 00:55:33,047 --> 00:55:43,507 Now, fascinatingly, we are only down 4.3% in the last seven days after the Binance breach, after the ETF sell-offs. 733 00:55:43,747 --> 00:55:47,867 Only down 9%, 9.6% in the last 30 days. 734 00:55:48,607 --> 00:55:49,887 I mean, it really could be worse. 735 00:55:50,408 --> 00:55:51,827 It actually could be a lot worse. 736 00:55:52,107 --> 00:55:53,147 I'm pretty impressed by that. 737 00:55:53,587 --> 00:55:54,307 So there you have it. 738 00:55:54,428 --> 00:55:59,547 The state of the network, other than the node drop-off, which we'll keep an eye on that, but the state of the network is strong. 739 00:55:59,547 --> 00:56:03,387 Bitcoin has remained strong during all of this, and you should thank it. 740 00:56:14,288 --> 00:56:16,127 All right, you know what the drill is. 741 00:56:16,227 --> 00:56:19,107 Links to what I talked about are over at thisweekinbitcoin.show, 742 00:56:19,207 --> 00:56:20,987 plus some stuff that didn't make it into the show. 743 00:56:21,327 --> 00:56:22,367 Let me know how I did. 744 00:56:22,467 --> 00:56:25,307 My goal is to give you a show that doesn't get distracted by the emotions, 745 00:56:25,547 --> 00:56:28,127 the drama, the politics, but focuses on the signal. 746 00:56:28,127 --> 00:56:31,408 so you can plan for yourself, your friends, your family, your future, your business, 747 00:56:31,507 --> 00:56:34,207 whatever it might be, boost.jupiterbroadcasting.com. 748 00:56:34,467 --> 00:56:36,908 And, of course, I want to hear your thoughts on the AI trade, 749 00:56:37,347 --> 00:56:39,787 anything we talked about in the Boost segment as well. 750 00:56:40,067 --> 00:56:44,307 As I wrap up, hopefully I'll see some of you at the Texas Linux Fest 751 00:56:44,307 --> 00:56:45,847 or at our lunch meetup. 752 00:56:45,967 --> 00:56:49,087 It's going to be at the Austin Beer Works near the Commons Events Center. 753 00:56:49,207 --> 00:56:51,908 Details at meetup.com slash jupiterbroadcasting. 754 00:56:52,187 --> 00:56:55,447 If you can make it, we'll be there on the Saturday after this episode posts, 755 00:56:55,607 --> 00:56:56,987 and I'd love to see you there. 756 00:56:56,987 --> 00:57:16,147 All right. That's it for me. Thank you so much for joining me on this week's episode of This Week in Bitcoin. I'll be back with stories to share, macro analysis and probably probably some changes in some of the directions of these trades with the elections wrapping up, I imagine. So keep an eye on all of that. Thanks so much for joining me. See you back here next week. 757 00:57:26,987 --> 00:57:56,967 Thank you. 758 00:57:56,987 --> 00:58:25,987 Thank you.