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Welcome in to This Week in Bitcoin, episode 107.

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My name is Chris, chrislas.com, jupiterbroadcasting.com.

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Well, I can see clearly now, the rain is gone.

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Take a moment and picture what the economy just might look like if there was no AI pump.

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Using the recently revised Q1 GDP number for the U.S., AI investment wasn't just a contributor.

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It was the entire story.

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Roughly 84% of Q1 GDP growth came from AI-related investments.

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So AI stocks and things related to AI, hardware data centers, things like that.

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So when people say the economy is holding up, I think the real question is, is it the economy holding up or is it the giant AI CapEx cycle that is skewing the scoreboard, if you will?

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And I think what we're seeing with Bitcoin is it's the first major market that is pricing the economy without AI distortion.

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So stocks, we know they're getting pushed higher by the historic AI bubble.

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I've covered that last week, so we'll go quickly through that.

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It seems to me that Bitcoin's been reflecting a weaker economy that's hiding below all of this.

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And we all know that this takes time to play out.

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But I think this summer could very well mark the transition to this AI bubble endgame.

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As SpaceX and OpenAI raced toward what could become the biggest IPO showdown in history, not just Wall Street, anywhere, everywhere.

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Reports say OpenAI could file for a blockbuster IPO as soon as tomorrow.

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The goal would be to go public as early as September.

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Elon Musk may already have the upper hand.

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SpaceX reportedly targeting an $80 billion raise, a valuation north of $1.5 trillion.

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Investors are now forced to pick sides in this high-stakes fight for bragging rights and the future of AI.

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All right. So let's just sort of set the table here and look at some numbers.

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The valuations for the IPOs for these companies, the numbers are so huge, I think we're kind of losing touch with reality.

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SpaceX plans to come in around 1.7 trillion.

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I'm going to do the low numbers, by the way.

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Open AI around 800, 800, 850, maybe 900 billion.

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Anthropic, 900 billion, somewhere around there.

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These would be the largest US IPOs by valuation ever.

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To put it in perspective, the largest in the past was Alibaba at 169.4 billion.

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Meta at 81 billion.

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So the smallest one on here, open AI or Anthropic, depending on the way they land,

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is still massively larger.

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Even on the low end,

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an OpenAI or Anthropic valuation

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would be a totally different league

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than something like

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what was considered a mega IPO in the past,

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like Meta.

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For example, OpenAI or Anthropic,

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they could be 12 times the size

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of Meta's IPO valuation.

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Six times the size of Alibaba's US IPO valuation.

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So to say markets have never seen an event like this

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cannot be overstated.

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Markets, not just the US market,

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Markets have never seen an IPO liquidity event at the scale of these three companies.

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And I just, I suspect it's not going to be a good thing.

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There's going to be a real cost.

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Now, I've heard people say, well, it'll be like the dot-com bust.

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You know, there was a lot of dark fiber laid and we had a few winners stand out.

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Okay, well, let's think about that.

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Oh, I've also heard it compared to the railroads too.

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Let's think about that for a second.

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You know, the railroad companies, there was this big boom.

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They went bust, but they laid tracks.

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Okay, so we got Dart Fiber, we got Tracks, you know, we got some analogies here.

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Well, when a railroad company built Tracks in the 19th century, those Tracks could be used for 50 years.

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When an AI company builds a data center, the building is good, but the chips inside, the expensive stuff, the NVIDIA chips inside,

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for a competitive frontier AI lab, they become obsolete in three to five years.

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Now, you know, folks are going to scoop those up on the used market.

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But for OpenAI and Anthropic and XAI, they don't just get to simply pay off the debt they have and then just chill.

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They have to essentially generate enough profits to effectively buy their entire hardware stack every 36 to 48 months just to stay competitive.

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That's a totally different kind of infrastructure business than the dark fiber or the railroad tracks.

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They're not comparable there.

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We also know that there's a lot of circular revenue here.

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A significant portion of AI revenue is likely circular.

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So for example, Anthropic can commit billions to,

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or I'm sorry, Amazon could commit billions to Anthropic

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or whatever, just using names.

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But let's say Amazon says,

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okay, Anthropic, we're gonna commit

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quote unquote billions to you.

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And then release a press release.

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Amazon commits billions to Anthropic.

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A lot of times that support is structured

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as cloud compute credits, not actual cash.

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And then Anthropic uses those credits

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to rent AWS servers.

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Amazon books that activity as AWS revenue.

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And Anthropoc gets to benefit with its enterprise value

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because look at all this compute they just added.

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So we've got trajectory.

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So they're calling this a circular revenue.

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Now looking at OpenAI,

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OpenAI is in their own internal documents

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on track to burn a staggering amount of cash through 2030.

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So OpenAI needs to build a business

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on the scale of Apple's original iPhone ecosystem

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them from scratch in under five years in order to get to the money that they need to pay off

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their infra and make profit. So if they create models that are genuinely going to replace white

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collar jobs across major industries, then this spending looks legitimate and they're going to

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make trillions of dollars and this IPO will look obvious in hindsight. That's going to just be the

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way it is. But if they hit some sort of scaling laws and diminishing returns and they don't quite

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get to the point where they can replace white-collar jobs in the next five years,

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the market is going to, they're going to punish them for that.

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In the private world, they can go get more VC funding, they can keep burning.

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That's not how it's going to work in the public market.

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They are going to have to be responsible for that.

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Now, let's talk one more time here about Anthropic.

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To support roughly, let's say, a $965 billion post-IPO valuation,

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at what would be a normal tech multiple of 25x earnings,

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which if you can believe is a little low for an AI company,

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but let's go with the low numbers here.

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Anthropic would need to produce around $38 billion to $40 billion

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in annual net income.

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Not revenue, profit.

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$40 billion in profit.

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That's a key distinction.

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Anthropic does not just need to become a successful AI company.

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It needs to become one of the most profitable technology companies

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that exists on earth for this bet to play out.

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Now, XAI, the third IPO, which might actually be the first one to go, it's harder to analyze

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because it's been brought into X and Starlink and all of that makes money.

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X has subscriptions.

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Starlink makes revenue for X and XAI.

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So it's murky in there because they can actually use the cash generated from the real Starlink

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business to help cover some of their costs for a while.

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But where XAI stands out from the other two is that XAI took on traditional bank debt with a high interest rate from Morgan Stanley.

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So they have a high interest rate loan.

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Instead of like getting private funding like the other blokes have done, Musk took some of his money from an actual bank.

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So from what I can tell, XAI needs to turn its API services and its super grok services into a $10 billion per year profit engine.

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and they need to do that within a few years

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in order to become profitable and pay off that loan.

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So they'll be able to use Starlink and SpaceX

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and X subscriptions to subsidize their AI info for a while,

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but they've got to get to around, and for my math,

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over $10 billion per year in profit

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in order to make this bet pay off.

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And if all three of these companies

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come to market around the same time,

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which they seemingly are trying to do within, you know, a six to nine month window.

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The real story here is this is the largest liquidity extraction event in the history of markets.

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That's the story.

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Wall Street is expecting these three companies combined to generate roughly 90 billion to 100 billion in pure annual net profit by 2030.

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So that requires the trio to collectively match the current annual profitability of Microsoft within just five years.

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Within five years.

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That, that's never been done.

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So let's talk about productivity and whether you really see a productivity boost from AI.

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If I were being optimistic, I'd say, look, the last tech trades we got excited about were around social media and the Internet of Things.

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And we got excited enough about those. And did they really ever threaten to deliver a productivity boom?

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But maybe AI really will. You're not a believer.

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I do think there's a productivity boom from AI, but it's how big of a one.

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We're pricing an extraordinary one. We're pricing that, you know, these companies are all going to make an extraordinary amount of profit in the same overlapping sector, like Anthropic, you know, ChatGPT, Gemini, whichever, XAI.

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They're all going to completely dominate this space.

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they're all going to take in a whole load of revenues from all these other industries,

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even though these industries don't make enough money, the projections to like pay all these

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companies, all those made of earnings. And there's a real productivity boom, but how much of one and

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how quickly is it coming through? You know, it's really hard to define. I think it's the key

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question. And when do we, when do we, when are we going to get that answer? And because that's the

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kind of earnings rug pull at some point, I think at the moment, you know, there's real earnings

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being made there, but it's the projections going out that really kind of worry me. So the other

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thing about those projections is if you are really going to get to the market valuations they need,

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that you're going to be, you really truly will be disrupting jobs. You truly will be. And that would

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have an impact on the economy, which would have an impact on the market, which would hurt their

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revenue. So that's one trap. And that is going to suck a lot of liquidity out of the market.

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And it's just going to be something we got to ride through. But then there's another dynamic here

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that could derail the entire thing.

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So right now, there's a lot of will they or won't they talk around the rates.

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The effective Fed fund rate from the Fed in the U.S. is like around 3.5, 3.75% right now.

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If we had a sudden inflation spike, I don't know, maybe an energy shock or something like that,

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and the Fed did come out and hike rates,

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which seems like a long shot to me,

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but has a 39% chance on poly market right now.

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An escalating interest rate environment

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would trigger major financial traps

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for these AI companies.

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It would compress their tech multiples

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from like say around 25 or 30X,

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which is generous,

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but kind of what they're going for,

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to probably 15X.

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So you would go from a 30X multiple

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to a 15X multiple.

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OpenAI has needed annual net profit

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to sustain that $1 trillion valuation,

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it doesn't stay at just around $40 billion, $39 billion

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that they have to get, you know,

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which is crazy already, a net profit of around $40 billion.

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If rates start going up, it doubles instantly.

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They need $80 billion because of all the debt.

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They have to get $80 billion in net profit if rates go up.

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They go from $39, $40 billion requirement to $80 billion,

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and the $40 is already almost impossible to do.

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They'd have to create Apple's iPhone business in five years in order to get to that.

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And if the rates go up, it doubles.

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A rake height essentially moves the goalposts twice as far away.

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It's just what it is.

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It makes their five-year targets mathematically impossible.

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It truly does.

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And the data center builds take a complete hit here,

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because building data centers requires an unbelievable amount of real physical debt.

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And there's land involved.

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There's loans for all the material.

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Every fraction of a percentage point the Fed adds translates to hundreds of millions of dollars in extra interest payments for these labs.

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Just little tweaks upwards, just little tweaks.

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And it would impact XAI the hardest because they already carry $5 billion of traditional bank debt from Morgan Stanley.

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And higher rates would actively bleed from their operational cash flow and their ability to invest in AI and they'd have to pay more in interest.

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So here we are on the cusp of will they or won't they?

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While we have a possible energy situation also developing.

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And of course, why is that? Why do they care?

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It's in order to win more votes.

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The midterm elections are right around the corner.

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Now, you have to understand that this drop right here.

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Now, that's not the right clip.

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Sorry, this is the right clip.

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This morning's release of Core PCE, the Fed's preferred inflation gauge,

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showed prices rose at an annual rate of 3.3 percent in April, a nearly three-year high.

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Let's bring in Joe Livornia.

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He most recently served as Treasury Secretary Scott Besson economic counselor Joe great to have you with us Great to be with you Thank you Why at least 100 basis points Because if you look at core inflation from where it was before we attacked Iran it going to be up at least 100 basis points So in simple

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basic math, your real interest rate has collapsed 100. You'd want to offset that

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by raising the funds rate at least by that amount. As you said at the highlight,

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the beginning of the show, these equity averages are at all-time highs. The credit spreads are

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super tight. The dollar is, you know, high, but not excessively high. There's no tightening of

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financial conditions and the inflation numbers, the three and six month change show inflation

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moving up towards 4%. So what's going to force that back to 2%? It won't happen magically.

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Yeah, but you can't. I mean, I just can't imagine they're going to do a rate hike. I think what

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you do instead is you come up with a new way to calculate inflation. Oh, a new Fed standard,

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the new golden standard and look at that wouldn't you know it inflation is just around where we

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wanted it i mean maybe okay so that clip i i was playing there for a second i want to set that up

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because it starts it comes in hot because a big portion of this which is going to force the fed's

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hand is going to continue to put downward pressure on bitcoin is this prolonged conflict with iran

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it's going to have second order effects on the energy market data centers are effectively massive

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factories that turn electricity into intelligence. So it's going to have an impact on the AI PAMP.

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Power rates are already going up. These companies are trying to commit to covering energy cost

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increases. Part of the reason we're not fully feeling the impact of this, though, and why it's

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still sort of like, well, it depends on how long things go. And we're just sort of in this weird

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purgatory state is because Western governments have been releasing oil from their strategic

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reserves. And so in this clip that I'm going to play that we started there for a second,

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this is from the Clear Value Tax YouTube channel. And what he notes is that the U.S. seems to be

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once again releasing massive amounts of oil. The chart that he has up on the screen shows us that

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levels are down to like the mid-80s, that we haven't been that low since the mid-80s, which,

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of course, was shortly after we had dumped a bunch for the oil crunch in the late 70s and mid-70s,

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even issues in the 80s as well. So we were historically low at that point. And that's

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where we're at once again. And he suggests in this clip that it is likely to be partly

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politically motivated. And of course, why is that? Why do they care? It's in order to win

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more votes. The midterm elections are right around the corner. Now, you have to understand that this

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drop right here, this is just starting and it's going fast. The most recent week's data shows a

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release of 9.1 million barrels. And that's just short of the all-time high release set the prior

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week. And look, it's not like we have the luxury of a huge stockpile anymore. We had 725 million

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barrels near the highs. Now we're down to 365 million barrels as of May 22nd, and it's dropping

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fast. I mean, just take a look at where we are compared to previous periods. 365 million barrels,

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that is historically low. And again, it's falling fast. So yes, this is getting concerning.

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But you know what's a little bit wild, at least to me?

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We're releasing a massive amount of oil from our emergency oil reserves, right?

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But at the same time, we're exporting a record amount of oil to Europe and Asia.

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Like, why are we not protecting our emergency oil reserves?

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But you know what?

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I'm going to answer my own question.

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It's probably because our allies are very upset with us.

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And this is the least that we can do for them in order for our allies not to turn on us,

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at least not for now.

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But OK, all right.

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So he's probably right there.

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So let's bring all this together.

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The Western governments are quickly draining our oil reserves, which removes future optionality.

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Obviously, the energy market could easily spiral out of control, which could slam the stock market.

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It could potentially rug these AI IPOs as they're trying to launch, which would collapse the GDP of the United States and all other Western governments.

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So we find ourselves in a classic systemic trap.

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draining resources, remove strategic flexibility,

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energy spikes, feed inflation,

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the market pulls back,

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the growth engine IPO stall

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and the broader economy stalls with them.

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And I think Bitcoin is sniffing this risk out right now.

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Now, I'm not saying this is what's going to happen.

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I am saying this is a risk.

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And even if this particular scenario doesn't play out

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and we get into 2027 and through these IPOs,

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the vacuuming of liquidity out of the market

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is just going to be monstrous.

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All right, so the question is,

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Chris, if the math is so obvious,

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why are people selling their Bitcoin to buy AI stocks?

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We see it in the charts,

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especially in the ETFs for almost 12 weeks straight.

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People are selling their IBIT

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and whatever and rotating into AI stocks.

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Well, I'd argue because some of the largest holders out there,

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I think, and I've warned you guys about this,

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I think this whole Bitcoin is digital gold has bid us in the rear.

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And it no longer is what people consider working.

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They think, well, look, if it was digital gold, then it should be up right now.

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You know, I thought about this early on,

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And I thought this digital gold narrative could bite us.

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Here's the clip that made me think a little bit more about this.

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Parker, she's a strategic advisor at RWA.xyz.

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Emily, it's good to see you.

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And I know that Tom Lee was asked this question on our air earlier today.

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And his defense was, this is what always happens during crypto winters.

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And he calls them rage quitters.

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Yes, I mean, people have been pivoting from crypto to AI for a while.

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Here's the thing.

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Bitcoin is a sentiment-driven narrative.

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And it's a, I'm sorry, it's a sentiment-driven asset.

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and it's a narrative-driven asset.

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And in terms of sentiment,

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you just have people excited about other things right now.

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They're excited about AI

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and they're excited about the stock market,

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which is largely driven by AI.

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There's also one really important difference

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between Bitcoin and AI,

303
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which is that I'm sure you've seen

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there's a lot of very smart people who still say,

305
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I don't understand how Bitcoin works.

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I don't understand what it does.

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And like, not that many people understand how AI works,

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but they don't have to

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because they're actually using it.

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It touches their daily lives.

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I actually think there is something to that.

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the benefits of Bitcoin are a lot more abstract, just like benefits of gold. I mean, think about

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the how long gold has been around. The fact that it hasn't been aped into by more people shows you

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that the average person doesn't get the benefit of a store of value generally, but they can go

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use Chagypity and get a recipe and they get that benefit. I think Mark Cuban was talking about the

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narrative problem. You know, as I said, Bitcoin's a narrative driven asset. It came into the world

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to be this unique asset that was independent of banks and governments. But over the past few years,

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much of what's powered Bitcoin's rise has been Wall Street or the U.S. government. And it just

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doesn't really make sense as a story. And it's also the opposite of Bitcoin's origin story. So

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it's kind of losing what makes it unique. And I think for portfolio holders, I don't even know

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how she gets there. I've heard this clip a couple of times now, and I don't know how she gets there

322
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at all. It's a fundamental misunderstanding. The idea was like, OK, Bitcoin is so unique,

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it can act as a hedge against the stock market. So you should have Bitcoin in your portfolio.

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But with stocks soaring and Bitcoin plunging, basically it's the opposite.

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It's almost like you want to have stocks in your portfolio to act as a hedge against Bitcoin.

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You know, they're never happy because they complain when Bitcoin is correlated to the NASDAQ or the S&P.

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They say it's risky.

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And then when Bitcoin decorrelates, well, then it's a failed experiment.

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It's no longer digital gold.

330
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Well, which one is it?

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And I think, you know, I was talking to a few friends a couple of about a year, year and a half ago.

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there's a first kind of conflict between Iran and the Middle East, and Bitcoin had sold off

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instead of rallying on that kind of along with the stock market. And they said, wait a minute,

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those correlations aren't what I was promised and saw that as an opportunity to sell. It was

335
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fortuitous in that case. What would your message be to those who are still in it? I mean, do they

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need to sell and get out at 67 and go put the capital into something that's actually going to

337
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grow over time and has a proven track record.

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Oh, it hurts.

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It's like they all have AI-itis that's affected their memory.

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I mean, has that host forgotten that Bitcoin has been the best performing asset for 10

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years and that we are in an AI extreme bubble that is an anomaly?

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It's incredible.

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And since when did anybody say you should buy Bitcoin and expect to sell it within a

344
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year and make a profit?

345
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When has that ever been the promise?

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Ever.

347
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This is absolutely bonkers. And first of all, narrative almost always follows price, which is the opposite of what they're saying. It's embarrassing for them. But not every fat cat investor is this dumb. Speaking of SpaceX, thanks to their IPO filings, we actually learned that they have been sitting on a little stack of Bitcoin.

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According to an SEC filing on Wednesday, Elon Musk's SpaceX holds more than twice as much Bitcoin as previously estimated.

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Here to break it all down with us is Bloomberg's Ed Ludlow, co-host of Bloomberg Technology.

350
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Ed, Elon Musk's view on Bitcoin has swung between endorsement to skepticism. Where does it stand right now?

351
00:22:59,171 --> 00:23:04,111
Yeah, there's a big difference in the SpaceX story between the what and why of these Bitcoin holdings.

352
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So as of that regulatory filing, they hold 18,712 Bitcoin.

353
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And the average purchase price over the history of the holdings is like 35,000 US dollars per token.

354
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So Bitcoin costs them about 661 million dollars to acquire.

355
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The value of the holdings is 1.3 billion dollars.

356
00:23:23,471 --> 00:23:27,731
And like the way that SpaceX would tell it is what are they treating this as?

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Basically, it's held as a treasury reserve asset just in the way that cash or bonds would be.

358
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but by a custodian third party.

359
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That's very different to saying,

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well, what is Elon Musk's attitude to it?

361
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You don't get that from the filing itself.

362
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Although I guess if you guys want to have some fun,

363
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this is Bloomberg Crypto.

364
00:23:44,471 --> 00:23:44,711
Yeah.

365
00:23:44,851 --> 00:23:45,911
We could come up with some ideas.

366
00:23:46,051 --> 00:23:47,751
Well, you know, they completely missed the signal here.

367
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The signal is, is that private companies

368
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have been stacking Bitcoin for a while,

369
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but they don't have to tell anyone.

370
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And then we find out when they try to go public.

371
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And SpaceX, 18,000 is a nice little stack

372
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that they acquired in the 30s.

373
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So they're doing just fine.

374
00:24:03,211 --> 00:24:08,391
I I'm pretty impressed. We started the week speaking of Bitcoin strategies, learning that

375
00:24:08,391 --> 00:24:20,451
a sailor strategy sold 32 Bitcoin. That's 0.0038% of their 843,738 Bitcoin stack.

376
00:24:20,711 --> 00:24:25,491
And I think this sales really about two things. I think it's interesting that people are really

377
00:24:25,491 --> 00:24:31,411
freaking out in some areas, but being that the stock being, I think what strategy was maybe seen

378
00:24:31,411 --> 00:24:37,451
as, especially in just the MSTR days, was the stock that just holds Bitcoin. And if you bought

379
00:24:37,451 --> 00:24:43,491
MSTR, you were getting proxy exposure to Bitcoin. That's not the product anymore. That has not been

380
00:24:43,491 --> 00:24:47,311
the product for a bit. And we'll talk about that in a second. The other thing that's kind of going

381
00:24:47,311 --> 00:24:52,511
on under the surface here is you might recall the strategy met all the criteria for S&P 500 inclusion

382
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multiple times. Market cap, liquidity, four consecutive profitable quarters. But the S&P

383
00:25:00,291 --> 00:25:05,031
index committee use their quote unquote discretionary power to reject them anyway.

384
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You might also remember I covered the MSCI index threatening to kick out these Bitcoin

385
00:25:12,111 --> 00:25:17,351
treasury companies out of the index and their index is used by trillions of dollars worth

386
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of ETFs.

387
00:25:18,371 --> 00:25:23,231
I mean, they were floating this idea that any Bitcoin business that had 50 percent or more

388
00:25:23,231 --> 00:25:26,111
of its total assets in Bitcoin would be excluded from the index.

389
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Now, MSCI ultimately decided to not do that.

390
00:25:29,551 --> 00:25:32,391
But they kind of, if you remember, they left the door open back in February.

391
00:25:32,931 --> 00:25:34,591
They said, well, we might do something in the future.

392
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So with that in mind, listen to this clip of Sailor.

393
00:25:39,351 --> 00:25:43,751
This was shortly after they announced on their earning calls before the Bitcoin sale that,

394
00:25:43,751 --> 00:25:46,231
you know, he was going into more detail about why they might sell Bitcoin.

395
00:25:46,811 --> 00:25:50,891
But there's been a bit of confusion in the market about where the dividends come from.

396
00:25:51,111 --> 00:25:52,391
You know, how do we pay the dividend?

397
00:25:52,391 --> 00:25:59,431
And for most of the history of the instrument, we sold common equity, MSTR equity, to pay the dividend.

398
00:26:00,591 --> 00:26:02,531
MSTR equity is a derivative of Bitcoin.

399
00:26:02,711 --> 00:26:04,411
It normally trades at a premium to Bitcoin.

400
00:26:04,671 --> 00:26:06,691
And so we were selling a Bitcoin derivative.

401
00:26:07,011 --> 00:26:11,291
But some people worried that we wouldn't be able to sell the equity in the future.

402
00:26:11,511 --> 00:26:14,511
And then there are short narratives that we have to sell the equity.

403
00:26:15,231 --> 00:26:19,431
And then there are other narratives that the company won't sell its Bitcoin.

404
00:26:19,431 --> 00:26:21,891
and that kind of metastasized to,

405
00:26:22,471 --> 00:26:23,691
well, if they're not going to sell their Bitcoin,

406
00:26:23,811 --> 00:26:26,311
it must not have any value and they can never sell it.

407
00:26:26,371 --> 00:26:27,411
And if they can't sell it,

408
00:26:27,451 --> 00:26:28,711
then we can't count the Bitcoin

409
00:26:28,711 --> 00:26:30,311
as an asset on the balance sheet.

410
00:26:30,551 --> 00:26:32,991
So if you had $65 billion worth of something

411
00:26:32,991 --> 00:26:34,971
and people wanted to value it at zero,

412
00:26:35,791 --> 00:26:37,071
it's not very good, right?

413
00:26:37,151 --> 00:26:38,891
We don't want the credit rating agencies

414
00:26:38,891 --> 00:26:42,911
to think the company has zero dollars of assets.

415
00:26:42,911 --> 00:26:44,271
We want the credit rating agencies

416
00:26:44,271 --> 00:26:46,451
to think we have $65 billion of assets.

417
00:26:46,791 --> 00:26:48,211
And ironically, one of the ways to do that

418
00:26:48,211 --> 00:26:49,231
is to sell the Bitcoin.

419
00:26:49,431 --> 00:26:51,111
this is the way it is.

420
00:26:51,371 --> 00:26:54,491
While Saylor seems to kind of always be reinventing his strategy,

421
00:26:54,691 --> 00:26:58,451
I feel like Adam Back's treasury company is gearing up to be a direct competitor

422
00:26:58,451 --> 00:27:00,991
and kind of honing in on their overall play.

423
00:27:01,371 --> 00:27:06,811
Now, personally, I'm not in a hurry for government organizations to buy Bitcoin

424
00:27:06,811 --> 00:27:10,651
because as the saying goes, everybody buys Bitcoin at the price they deserve.

425
00:27:10,651 --> 00:27:14,451
And it's okay to me if they buy at a higher price, basically.

426
00:27:15,631 --> 00:27:17,911
How does BSTR play into that then?

427
00:27:17,911 --> 00:27:27,751
Yes, so BSTR is another microstrategy competitor. I'm the CEO and my co-founder Sean Bill is the CIO

428
00:27:27,751 --> 00:27:43,742
and then some other early Bitcoin investors behind that And the differentiator for BSTR which we put into the file documents now this is still waiting regulator approval so I can talk about what in the file documents of course

429
00:27:44,322 --> 00:27:49,322
and there we have explained that we intend to be active,

430
00:27:49,322 --> 00:27:53,922
so to seek a return on Bitcoin using fund management strategies,

431
00:27:54,582 --> 00:27:59,622
whereas many of the treasury companies are effectively relying on cold storage

432
00:27:59,622 --> 00:28:02,402
and the capital markets mechanisms.

433
00:28:02,642 --> 00:28:05,602
So we aim to use both approaches simultaneously.

434
00:28:15,862 --> 00:28:17,522
Oh man, they did it.

435
00:28:17,882 --> 00:28:18,762
They did it.

436
00:28:20,122 --> 00:28:22,322
They got me to talk about the Clarity Act again.

437
00:28:23,982 --> 00:28:25,842
What a soap opera this thing has become.

438
00:28:26,702 --> 00:28:31,802
And trust me, it took Jamie Dimon running his mouth to get me to talk about it this week.

439
00:28:31,842 --> 00:28:32,762
I wanted to take a break.

440
00:28:33,342 --> 00:28:35,802
But here's Jamie Dimon on Fox Business.

441
00:28:36,482 --> 00:28:39,542
Jamie, he's pissed off that the Clarity Act is making progress.

442
00:28:39,822 --> 00:28:42,242
So are you happy with the way the Clarity Act is turning out?

443
00:28:42,242 --> 00:28:42,482
No.

444
00:28:43,182 --> 00:28:49,542
No, because it allows them to effectively pay interest on deposits, stable coins or something like that,

445
00:28:49,642 --> 00:28:51,602
without the protection that they should have.

446
00:28:51,742 --> 00:28:53,622
And it doesn't do anything for AML-BSA.

447
00:28:53,962 --> 00:28:55,282
It has almost no legal protections.

448
00:28:55,842 --> 00:28:58,242
So no, the banks will not accept it that way.

449
00:28:59,142 --> 00:29:01,922
That is legitimately not a true statement.

450
00:29:02,402 --> 00:29:04,962
I don't really give a crap about the Clarity Act,

451
00:29:05,022 --> 00:29:06,202
but the one thing about the Clarity Act

452
00:29:06,202 --> 00:29:10,022
is it's loaded, loaded with surveillance

453
00:29:10,022 --> 00:29:13,862
and other mechanics to monitor financial transactions.

454
00:29:14,142 --> 00:29:14,442
Loaded.

455
00:29:15,122 --> 00:29:17,982
And the ABA, the small banks, the credit unions,

456
00:29:18,242 --> 00:29:19,162
it's not just the big guys.

457
00:29:19,422 --> 00:29:20,782
I'm not worried about stablecoin,

458
00:29:20,782 --> 00:29:23,362
but if it happened, I'm telling you,

459
00:29:23,562 --> 00:29:24,722
I would have nothing to do with it

460
00:29:24,722 --> 00:29:26,062
and it would eventually blow up on its own.

461
00:29:26,502 --> 00:29:28,402
Okay, but that's my personal thing,

462
00:29:28,502 --> 00:29:30,762
but I do understand the concern of all the other banks.

463
00:29:31,042 --> 00:29:32,182
Well, the markup is coming.

464
00:29:32,302 --> 00:29:33,302
I mean, what are you going to do about it?

465
00:29:33,322 --> 00:29:34,162
It is, we'll fight it.

466
00:29:34,222 --> 00:29:35,562
If we lose, we lose and we'll live.

467
00:29:36,082 --> 00:29:36,322
Okay.

468
00:29:36,382 --> 00:29:37,062
But it will be fought.

469
00:29:37,162 --> 00:29:37,882
This will not be,

470
00:29:38,402 --> 00:29:40,802
no one's going to bow down to this guy, okay,

471
00:29:40,842 --> 00:29:41,582
or that company.

472
00:29:42,162 --> 00:29:43,302
He's the only one.

473
00:29:43,442 --> 00:29:43,602
Yeah.

474
00:29:43,662 --> 00:29:45,142
And he's spending hundreds of millions of dollars

475
00:29:45,142 --> 00:29:46,322
in Washington, this thing.

476
00:29:46,982 --> 00:29:48,962
He said he's representing the whole industry.

477
00:29:48,962 --> 00:29:49,442
He's full of shit.

478
00:29:49,442 --> 00:29:55,282
Martha doesn't really know how to handle that.

479
00:29:55,502 --> 00:29:56,722
First of all, you know, it's not all Brian.

480
00:29:56,822 --> 00:29:59,362
I mean, he is sort of the front man, but it's not all Brian.

481
00:29:59,442 --> 00:29:59,902
I'm watching this thing.

482
00:30:00,682 --> 00:30:02,542
He said he's representing the whole industry.

483
00:30:02,542 --> 00:30:03,042
He's full of shit.

484
00:30:04,402 --> 00:30:06,222
Well, we're going to watch that one.

485
00:30:06,522 --> 00:30:06,662
Yeah.

486
00:30:07,042 --> 00:30:07,722
Yeah, we are.

487
00:30:07,862 --> 00:30:08,342
Yeah, we are.

488
00:30:08,862 --> 00:30:11,322
So yesterday afternoon, two things happened.

489
00:30:11,322 --> 00:30:16,922
The Blockchain Association sent a letter to Senate Majority Leader Thune and Senate Democratic Leader Schumer,

490
00:30:16,922 --> 00:30:21,622
signed by 160 former national security intelligence

491
00:30:21,622 --> 00:30:23,562
and law enforcement professionals

492
00:30:23,562 --> 00:30:25,622
in support of the Clarity Act.

493
00:30:26,262 --> 00:30:28,702
And the second thing that happened yesterday,

494
00:30:28,822 --> 00:30:30,042
the Clarity Act was added

495
00:30:30,042 --> 00:30:31,562
to the Senate legislative calendar.

496
00:30:32,002 --> 00:30:34,302
It is now making it eligible

497
00:30:34,302 --> 00:30:35,842
for full Senate consideration.

498
00:30:36,262 --> 00:30:37,802
So the letter makes it clear

499
00:30:37,802 --> 00:30:40,762
how great the Clarity Act is for crackdowns.

500
00:30:40,762 --> 00:30:42,802
In fact, it really underscores

501
00:30:42,802 --> 00:30:44,282
the entire basis for the letter

502
00:30:44,282 --> 00:30:46,682
is how it gives them better surveillance

503
00:30:46,682 --> 00:30:49,782
over crypto, DeFi, stablecoins, etc., etc.

504
00:30:50,262 --> 00:30:52,502
Of course, Bitcoin is being left out of it.

505
00:30:52,822 --> 00:30:54,402
But that is the big takeaway.

506
00:30:54,822 --> 00:30:56,582
And that's your Clarity Drama Update.

507
00:31:02,282 --> 00:31:06,462
All right, now I want to cover one of the most misunderstood,

508
00:31:06,962 --> 00:31:09,742
misreported Bitcoin stories of the week.

509
00:31:09,742 --> 00:31:11,002
You may have heard it.

510
00:31:11,402 --> 00:31:13,762
Did the U.S. seize Iran's Bitcoin?

511
00:31:13,762 --> 00:31:22,342
This really got the rounds in just hours, and it was all kicked off by comments that were made by your buddy, Treasury Secretary Scott Besson.

512
00:31:22,342 --> 00:31:25,702
It's, oh, here, they have at it.

513
00:31:26,102 --> 00:31:29,422
So, you know, we've frozen Iranian bank accounts.

514
00:31:29,482 --> 00:31:31,942
After they started getting bombed by Iran.

515
00:31:32,102 --> 00:31:37,702
Yes, but it was a big strategic failure on the financial side.

516
00:31:37,802 --> 00:31:38,742
And you jumped right in.

517
00:31:38,842 --> 00:31:40,422
And we jumped right in.

518
00:31:40,782 --> 00:31:43,002
And, you know, they've been very good partners.

519
00:31:43,822 --> 00:31:47,582
I believe that we have seized about a billion dollars of their crypto.

520
00:31:48,922 --> 00:31:50,382
Just outright seized it.

521
00:31:50,442 --> 00:31:52,722
Just outright grabbed the wallets.

522
00:31:52,722 --> 00:31:59,682
Some of them may be typing in right now and they might not have realized that their wallet had been grabbed.

523
00:32:00,022 --> 00:32:07,262
And we are working with our allies all over Europe to grab villas and houses and properties.

524
00:32:07,862 --> 00:32:10,022
This is money that's stolen from the Iranian people.

525
00:32:10,022 --> 00:32:22,582
But you've frozen the offshore accounts. I mean, people may not understand that the Revolutionary Guard, they own so many of the businesses. They've been stealing money from the Iranian people.

526
00:32:23,582 --> 00:32:33,062
So I think with all the headlines that Iran is going to have a straight insurance policy paid in Bitcoin, people thought that Scott was talking about Bitcoin and they just assumed that.

527
00:32:33,062 --> 00:32:36,702
but you know he was talking about stable coins

528
00:32:36,702 --> 00:32:37,782
and you might have even noticed in there

529
00:32:37,782 --> 00:32:38,782
he says they've been great partners

530
00:32:38,782 --> 00:32:40,602
he's probably referring to Tether there

531
00:32:40,602 --> 00:32:42,102
speaking of Besant though

532
00:32:42,102 --> 00:32:42,942
just moments ago

533
00:32:42,942 --> 00:32:44,822
as I was sitting down to record the show

534
00:32:44,822 --> 00:32:46,382
he was in a Senate testimony

535
00:32:46,382 --> 00:32:50,342
and the strategic Bitcoin reserve came up

536
00:32:50,342 --> 00:32:52,762
the ghost of the strategic reserve live

537
00:32:52,762 --> 00:32:56,002
what we are experiencing right now Danny

538
00:32:56,002 --> 00:32:57,422
sorry I don't know why my play

539
00:32:57,422 --> 00:32:58,962
oh I do know why I'm hitting the wrong button

540
00:32:58,962 --> 00:33:01,062
all right here's the ghost of the strategic reserve

541
00:33:01,062 --> 00:33:02,262
I'll try to remember to hit the right button

542
00:33:02,262 --> 00:33:27,002
Part of that is our digital assets initiative. The strategic Bitcoin reserve is something, this is new technology, this is new ground. We are proceeding with all deliberate speed. And we are making sure that as we are doing this, in this complicated process, that we use best practices and things will be durable for the future.

543
00:33:27,002 --> 00:33:29,862
and look forward to working with you and your team on that.

544
00:33:29,862 --> 00:33:33,462
And I look forward to the Clarity Act being passed this summer.

545
00:33:34,242 --> 00:33:35,602
Oh, getting excited there about the Clarity Act.

546
00:33:35,682 --> 00:33:37,542
We'll see Bitcoin strategic reserve coming up again.

547
00:33:37,642 --> 00:33:39,042
I think that's kind of interesting.

548
00:33:39,722 --> 00:33:42,582
The clip I was spoiling yet again, two for two, I guess this week,

549
00:33:43,022 --> 00:33:45,522
it really helped me put it into perspective

550
00:33:45,522 --> 00:33:48,742
just what an information arbitrage we are living through with Bitcoin.

551
00:33:49,262 --> 00:33:54,962
And it's going to get even more stark as people just pile into the IPOs.

552
00:33:54,962 --> 00:34:00,402
and it's just obvious to me because like people were like looking around the room when when scott

553
00:34:00,402 --> 00:34:05,782
said the strategic reserve was still on the table and people talking about bitcoin just not living up

554
00:34:05,782 --> 00:34:10,562
to its original promise and other billionaires that have been bailing on it recently we are just

555
00:34:10,562 --> 00:34:17,222
so obviously in an information arbitrage and i think the issue is people bitcoin's positive

556
00:34:17,222 --> 00:34:22,122
aspects are really abstract like inflation's negative aspects are really abstract you know

557
00:34:22,122 --> 00:34:26,982
what I mean? It's hard for people to wrap their head around it. And so James Lavish was on what

558
00:34:26,982 --> 00:34:33,382
Bitcoin did. And the way he lays it out, I actually think this, if you want to call it information

559
00:34:33,382 --> 00:34:40,122
arbitrage, is actually, it's pretty understandable. What we are experiencing right now, Danny, is an

560
00:34:40,122 --> 00:34:46,162
information or a knowledge arbitrage. And so people just do not yet understand how Bitcoin is

561
00:34:46,162 --> 00:34:52,582
different and why it is the ultimate store of value and the ultimate debasement asset.

562
00:34:53,002 --> 00:34:54,702
They just don't understand it yet.

563
00:34:54,902 --> 00:34:55,842
There's a lot of confusion.

564
00:34:56,542 --> 00:35:02,622
The mainstream media puts out confusing and hit pieces about it all the time.

565
00:35:02,982 --> 00:35:08,402
They commingle it with all the other cryptocurrencies and they just call them all the same thing.

566
00:35:08,542 --> 00:35:10,822
And so I have friends who say, oh, yeah, I own Bitcoin.

567
00:35:11,442 --> 00:35:13,422
I own the Solana one.

568
00:35:13,882 --> 00:35:15,822
And it's like they just don't get it.

569
00:35:15,822 --> 00:35:42,462
And it's okay. It's not their fault. They're just not interested in doing the research themselves. They're listening to mainstream media and getting their news off of Facebook or their research off of Facebook. They're just not getting it. And so there is an information arbitrage that you and I are experiencing right now. It feels bad and it makes you feel like, am I an idiot? Am I just stupid that I'm, how early am I here?

570
00:35:42,462 --> 00:35:50,642
And the answer is you're still pretty early because I think that Bitcoin is going to trade above a million dollars in early 2030s.

571
00:35:51,182 --> 00:35:56,082
2032, 2033, I would be very surprised if we're not touching million dollar Bitcoin.

572
00:35:57,162 --> 00:36:01,142
That's me. That's my thesis. That's where I believe this thing is going.

573
00:36:01,822 --> 00:36:07,842
But I also believe that part of that is that knowledge arbitrage will close.

574
00:36:07,842 --> 00:36:26,462
And as that does, you're going to have the Harvards and the Yales and the University of Texas and the CalPERS and the Texas teachers and every pension and fire fund out there taking positions in Bitcoin as a core asset.

575
00:36:26,982 --> 00:36:32,142
And when they do that, that's when that knowledge begins to really spread.

576
00:36:32,242 --> 00:36:34,162
And people are like, oh, so Bitcoin is different.

577
00:36:34,222 --> 00:36:35,382
Okay, so Bitcoin is different.

578
00:36:35,462 --> 00:36:37,042
It's not just this moonshot thing.

579
00:36:37,042 --> 00:36:43,682
it's digital gold. Okay. Then I should probably own some. And funny enough is I think that that's

580
00:36:43,682 --> 00:36:48,722
going to be a much healthier rise for Bitcoin in price and a much more stable rise. It's not going

581
00:36:48,722 --> 00:36:53,482
to be this massive volatile thing. It's going to be like people, oh, I get it. Okay. I get it.

582
00:36:53,802 --> 00:36:58,842
Oh, okay. I understand now. I understand. I understand how it's different. And then we'll

583
00:36:58,842 --> 00:37:05,062
feel vindicated and, you know, we'll look like we're 143 years old when we're, when we're just

584
00:37:05,062 --> 00:37:08,522
in our 50s or in your case, 30s.

585
00:37:09,822 --> 00:37:11,802
All right, so let me know,

586
00:37:11,922 --> 00:37:14,602
do you think Bitcoin is going to get to a million

587
00:37:14,602 --> 00:37:16,362
or over a million by 2032?

588
00:37:16,502 --> 00:37:18,002
That's what James was saying there.

589
00:37:18,422 --> 00:37:19,662
And I've been thinking about that.

590
00:37:19,722 --> 00:37:22,102
That's often been sort of my mental benchmark,

591
00:37:22,262 --> 00:37:24,822
my target, if you will, a soft target of expectation.

592
00:37:25,802 --> 00:37:28,102
But it's only six years away.

593
00:37:28,742 --> 00:37:30,182
In the last five years or so,

594
00:37:30,222 --> 00:37:31,282
we've been all over the place.

595
00:37:32,222 --> 00:37:33,902
So do you think by 2032,

596
00:37:33,902 --> 00:37:36,602
will be over a million dollars.

597
00:37:36,782 --> 00:37:37,242
Boost in.

598
00:37:37,642 --> 00:37:38,542
Tell me what you think.

599
00:37:38,722 --> 00:37:39,802
You know I want to hear it.

600
00:37:58,462 --> 00:37:59,562
You can support the show

601
00:37:59,562 --> 00:38:00,702
just by doing what you do.

602
00:38:00,762 --> 00:38:02,022
If you want to buy Sats on River,

603
00:38:02,122 --> 00:38:03,442
I got a link in the show notes.

604
00:38:03,442 --> 00:38:06,102
is one of the best ways to buy sats in the U.S.

605
00:38:06,162 --> 00:38:07,802
Stack the sats over the summer.

606
00:38:08,342 --> 00:38:12,162
If you want to stack sats and go directly to your own wallet,

607
00:38:13,402 --> 00:38:15,882
Bitcoin Well, all about automatic self-custody.

608
00:38:16,062 --> 00:38:16,782
They don't have a wallet.

609
00:38:16,982 --> 00:38:17,522
You host it.

610
00:38:17,902 --> 00:38:19,382
It's time to spend your sats.

611
00:38:19,882 --> 00:38:21,842
The Bitcoin company, you go from lightning sats

612
00:38:21,842 --> 00:38:22,842
to gift card in seconds.

613
00:38:22,922 --> 00:38:23,982
You can log in with the lightning network.

614
00:38:24,082 --> 00:38:25,682
The only thing they do is Bitcoin.

615
00:38:26,202 --> 00:38:28,642
The Fold card lets you passively stack those sats,

616
00:38:28,922 --> 00:38:31,542
which if it's on discount, you're stacking more sats.

617
00:38:31,542 --> 00:38:33,042
And they have the new credit card, too,

618
00:38:33,042 --> 00:38:35,342
where you can get up to as much as 4% Sats Bank.

619
00:38:36,042 --> 00:38:37,202
Then, salt lending.

620
00:38:37,562 --> 00:38:39,442
You can get a Bitcoin-backed loan

621
00:38:39,442 --> 00:38:41,902
with liquidation protection from salt lending,

622
00:38:42,322 --> 00:38:43,722
so that way you don't have to sell your Bitcoin

623
00:38:43,722 --> 00:38:45,542
to get access to liquidity.

624
00:38:45,942 --> 00:38:46,962
Although, I will say,

625
00:38:47,582 --> 00:38:49,262
you want to be pretty careful.

626
00:38:49,482 --> 00:38:51,182
You want to be pretty careful these days.

627
00:38:52,542 --> 00:38:54,442
That's just some of the ways to support the show

628
00:38:54,442 --> 00:38:55,662
by doing what you do.

629
00:39:03,042 --> 00:39:07,202
And we do have some boosts.

630
00:39:08,182 --> 00:39:11,322
And now it is time for le boost.

631
00:39:11,722 --> 00:39:13,702
Oh, oh, oh my goodness.

632
00:39:13,862 --> 00:39:18,182
Coming in at the last minute, Derivation Dingus saving the show, although I don't have it in the totals.

633
00:39:18,582 --> 00:39:21,602
It is our baller boost, so I will at least read it.

634
00:39:21,602 --> 00:39:27,602
But it's coming in live as I'm recording with 44,444 Satoshis.

635
00:39:28,302 --> 00:39:29,942
This old duck still got it.

636
00:39:33,042 --> 00:39:36,622
Great show as usual.

637
00:39:36,762 --> 00:39:37,502
Thanks for the value.

638
00:39:37,662 --> 00:39:39,702
Even if Bitcoin is flat for another quarter or two,

639
00:39:39,802 --> 00:39:41,262
tons of great work have been happening.

640
00:39:41,482 --> 00:39:43,722
It gives us plebs just more time to DCA

641
00:39:43,722 --> 00:39:44,842
at these super low prices.

642
00:39:45,282 --> 00:39:47,422
That is a very positive attitude.

643
00:39:47,642 --> 00:39:49,462
And I agree, derivation dingus.

644
00:39:49,882 --> 00:39:51,902
Thank you for being our baller booster, sir,

645
00:39:51,942 --> 00:39:54,282
at 44,444 sats.

646
00:39:54,622 --> 00:39:55,462
Appreciate you.

647
00:39:55,462 --> 00:40:03,482
coming in at 13,300 satoshis.

648
00:40:03,482 --> 00:40:04,502
It's MDS.

649
00:40:09,402 --> 00:40:11,942
Well, my last boost was actually a pocket boost,

650
00:40:12,062 --> 00:40:13,482
but the pocket it knows well.

651
00:40:13,742 --> 00:40:15,022
Why don't you have all the stats on my wall?

652
00:40:15,102 --> 00:40:16,222
This is my last standing.

653
00:40:16,542 --> 00:40:19,922
This is the last standing Pure Signal Bitcoin podcast IMO.

654
00:40:20,722 --> 00:40:23,282
The bias and conflicting incentives are everywhere else.

655
00:40:23,282 --> 00:40:25,522
appreciating the value for value model more than ever.

656
00:40:26,082 --> 00:40:28,462
Grateful you're still beaming this work to the world.

657
00:40:28,622 --> 00:40:29,842
Well, thank you very much.

658
00:40:30,202 --> 00:40:30,762
Thanks, MDS.

659
00:40:30,922 --> 00:40:31,922
I appreciate the recognition,

660
00:40:32,082 --> 00:40:34,422
that recognition there of the value for value.

661
00:40:34,502 --> 00:40:35,422
Thanks for returning some.

662
00:40:35,662 --> 00:40:38,562
And our last boost, if you can believe it,

663
00:40:38,902 --> 00:40:40,522
comes from Adversary 17.

664
00:40:41,602 --> 00:40:42,302
Adversaries writes,

665
00:40:42,682 --> 00:40:44,302
I used to run both knots and core,

666
00:40:44,702 --> 00:40:46,042
but I only run core now.

667
00:40:46,402 --> 00:40:48,702
Just not a fan of property seizure in general.

668
00:40:49,142 --> 00:40:49,682
Mm-hmm.

669
00:40:50,222 --> 00:40:50,782
Make it so.

670
00:40:51,222 --> 00:40:52,142
That's just it right there.

671
00:40:52,442 --> 00:40:53,362
That's just it right there.

672
00:40:53,782 --> 00:40:55,402
Just not a fan of that.

673
00:40:55,402 --> 00:40:59,462
It just also makes the network very small, in my opinion.

674
00:40:59,782 --> 00:41:01,242
It makes the network very, very small.

675
00:41:01,442 --> 00:41:05,062
In a new kind of way, we're always worried about Bitcoin mining centralization.

676
00:41:05,422 --> 00:41:10,982
But I guess we don't worry about just a few small groups controlling Bitcoin nots, I guess.

677
00:41:11,622 --> 00:41:16,382
All right, I'm updating my totals as fast as I can, you know, being a big old math guy as I am.

678
00:41:16,722 --> 00:41:19,442
With the live boost coming in here, let's total it all up.

679
00:41:19,882 --> 00:41:30,953
So we had five of you stream sets That doesn seem right Did something happen technically with this episode I gotta check what happened This doesn seem right at all Five of you stream sets stacking 3 sats

680
00:41:31,073 --> 00:41:39,813
Holy crap. That's really low. With a grand total of six boosters, which we stacked thanks to our

681
00:41:39,813 --> 00:41:47,673
big old baller boost from Derivation Dingus, we stacked a grand total of this episode of 74,354

682
00:41:47,673 --> 00:41:53,453
sats. So that's pretty low. And I would normally, you know, I would normally be disappointed in that.

683
00:41:53,573 --> 00:41:58,793
However, two things, maybe three. Now I'm almost wondering when I see those low streaming counts,

684
00:41:58,793 --> 00:42:03,273
if there was a technical issue with a node or something like that. But the other thing is last

685
00:42:03,273 --> 00:42:09,013
week was a blowout. We had over 7,000, 700,000 sats. LUP had a great week and the launch had a

686
00:42:09,013 --> 00:42:13,993
great week. So the audience support has been showing up and, you know, Satoshi's, they're

687
00:42:13,993 --> 00:42:22,113
limited. So I'm not actually that disappointed, even though the hourly rate that that works out

688
00:42:22,113 --> 00:42:27,693
to, the 74,000 that works out to, is we won't go there. We're not even going to go there because

689
00:42:27,693 --> 00:42:31,233
I know you guys are still out there. I know you'll step it up. And I know you have been extremely

690
00:42:31,233 --> 00:42:36,873
generous recently, so I'm not too worried about it. If you would like to help make next week's

691
00:42:36,873 --> 00:42:41,633
episode do a little better, I think these last two episodes have been very high signal. You can

692
00:42:41,633 --> 00:42:46,153
boost with Fountain FM or get yourself Albie Hub. And then you can boost with a whole bunch of

693
00:42:46,153 --> 00:42:52,013
podcasting 2.0 apps. This here is a value for value podcast. No advertiser, so you boost in,

694
00:42:52,093 --> 00:42:56,173
keeps the show going. That's how it all works. Thank you everybody who supports the show with

695
00:42:56,173 --> 00:43:05,193
a boost or a membership. You know, if anybody recognizes that song too, you ought to boost in

696
00:43:05,193 --> 00:43:06,433
and tell me where that came from.

697
00:43:11,633 --> 00:43:21,013
All right, let's have some fun in the update section.

698
00:43:22,873 --> 00:43:28,233
You know, I have been bracing for a summer of stacking.

699
00:43:28,913 --> 00:43:34,353
The orange summer of bog, a slow dwindle as the IPO's vampire us all.

700
00:43:35,173 --> 00:43:39,233
But two things, usually when you're that certain about a market, that's when things change.

701
00:43:39,233 --> 00:43:46,613
And then the other constant of the universe is when you get a good Kramer crash out, it might be time to reconsider your stance.

702
00:43:46,753 --> 00:43:49,333
And ladies and gentlemen, I present you a banger.

703
00:43:50,353 --> 00:43:55,653
I do know that, again, the faith of the American people shocked, just shocked.

704
00:43:55,893 --> 00:44:00,193
I mean, I still think that I think that crypto, I mean, I sold my crypto.

705
00:44:00,313 --> 00:44:02,813
I announced everything on TV, what I did with crypto.

706
00:44:02,813 --> 00:44:09,113
But I would not touch crypto in a million years because I wouldn't trust the deposit bank.

707
00:44:09,233 --> 00:44:12,833
And you're making no distinction between centralized, decentralized.

708
00:44:13,353 --> 00:44:14,433
They fought regulation.

709
00:44:14,873 --> 00:44:15,833
They didn't want regulation.

710
00:44:16,253 --> 00:44:17,453
And you don't have regulation.

711
00:44:17,893 --> 00:44:21,233
So if you have your money in any of those, look, I'm not calling you an idiot.

712
00:44:21,573 --> 00:44:23,113
I'm just saying you're using a lot of blind fit.

713
00:44:23,593 --> 00:44:26,453
And I like to have my money at JP Morgan.

714
00:44:26,873 --> 00:44:30,133
And I check on Monday to see whether my balance is there.

715
00:44:30,613 --> 00:44:31,513
It's there.

716
00:44:32,193 --> 00:44:33,053
It feels good.

717
00:44:33,513 --> 00:44:34,493
Try getting your money out.

718
00:44:34,493 --> 00:44:37,653
I'm not going to mention the firm that I had my money in.

719
00:44:37,653 --> 00:44:40,493
but it was a fight to get the money out.

720
00:44:41,073 --> 00:44:41,653
A fight.

721
00:44:42,213 --> 00:44:45,033
And I think that everybody who owns these various corns,

722
00:44:45,253 --> 00:44:47,413
Solana, Litecoin,

723
00:44:47,833 --> 00:44:50,493
I think you're, I do think you're an idiot.

724
00:44:51,053 --> 00:44:51,373
Okay?

725
00:44:51,893 --> 00:44:53,973
I did not go to college to get stupid.

726
00:44:54,633 --> 00:44:55,493
Did he call it corns?

727
00:44:55,733 --> 00:44:57,713
Now you tell me, is that clip fake news?

728
00:44:57,993 --> 00:44:59,653
I saw that getting submitted around.

729
00:44:59,793 --> 00:45:01,553
I feel like I've seen that crash out before.

730
00:45:01,753 --> 00:45:03,853
I submit it for your consideration though.

731
00:45:04,293 --> 00:45:05,393
This next story,

732
00:45:06,233 --> 00:45:09,993
Well, what's great about this clip is it's not about Bitcoin at all.

733
00:45:10,293 --> 00:45:13,433
And yet, in some ways, it's totally about Bitcoin.

734
00:45:13,433 --> 00:45:15,553
I get to some breaking news now back here in the U.S.

735
00:45:15,573 --> 00:45:20,753
A former CIA senior officer is accused of secretly stashing 300 gold bars in his house

736
00:45:20,753 --> 00:45:24,613
that he brushed off as work-related expenses, according to court documents,

737
00:45:24,833 --> 00:45:26,733
and two people familiar with his employment history.

738
00:45:27,173 --> 00:45:29,373
Julia Ainsley is joining us now at this exclusive reporting.

739
00:45:29,553 --> 00:45:30,073
Sorry, Julia.

740
00:45:30,593 --> 00:45:30,893
What?

741
00:45:31,513 --> 00:45:31,973
I know.

742
00:45:32,213 --> 00:45:34,753
Hallie, when I first heard this tip, I didn't think it was real.

743
00:45:34,753 --> 00:45:45,153
And then the court documents spelled out that there was a man who was an employee of a government agency that was found with $40 million worth of gold bars in his home.

744
00:45:45,213 --> 00:45:49,393
If you're wondering how many gold bars that is, the court document says it's about 308.

745
00:45:49,693 --> 00:45:55,593
What my team here at NBC News, Dan DeLuce and Gary Grumbach and I found, is that that man was not just an employee of any agency.

746
00:45:56,053 --> 00:45:59,813
He was a high-level official with top-secret clearance in the CIA.

747
00:45:59,813 --> 00:46:03,453
and that he not only lied about what he was doing with this money,

748
00:46:03,873 --> 00:46:06,693
but that allegedly he also lied about his background,

749
00:46:06,853 --> 00:46:09,133
said that he graduated from a college he did not attend,

750
00:46:09,433 --> 00:46:11,453
that he went to a graduate school he did not attend.

751
00:46:11,693 --> 00:46:13,093
Man, that guy sounds like a wildcat.

752
00:46:13,193 --> 00:46:15,613
I guess he also has something like 34 high-end watches.

753
00:46:17,193 --> 00:46:18,493
But crypto is totally stable.

754
00:46:18,493 --> 00:46:19,513
Stablecoins are totally the concern.

755
00:46:19,813 --> 00:46:19,973
Totally.

756
00:46:20,573 --> 00:46:23,693
So this week I was watching CNBC, so you don't have to.

757
00:46:24,213 --> 00:46:28,813
And there I was going about my biz and totally always a Bitcoin maxi,

758
00:46:28,813 --> 00:46:33,253
Anthony Pomp, Liano, came on, and he actually had a really good segment.

759
00:46:33,613 --> 00:46:35,313
I was like, oh, good job there, Pomp.

760
00:46:35,353 --> 00:46:35,753
Good job.

761
00:46:35,813 --> 00:46:36,613
Maybe I'll clip that.

762
00:46:37,093 --> 00:46:43,133
The reaction, however, that I noticed online about an hour or two later was nasty.

763
00:46:43,833 --> 00:46:49,933
Someone had taken something he said, which was Bitcoin is a dog with fleas, focused just

764
00:46:49,933 --> 00:46:52,733
on that and put it out on blast on social media.

765
00:46:53,153 --> 00:46:56,433
So I thought the fair thing to do, because I think he was actually making a decent point

766
00:46:56,433 --> 00:46:57,713
and wasn't actually slamming Bitcoin,

767
00:46:58,133 --> 00:47:01,393
would be to play the entire clip in its full context.

768
00:47:02,213 --> 00:47:06,253
So this is Anthony Pompliano, or aka your buddy Pomp,

769
00:47:06,653 --> 00:47:10,413
and this is him on CNBC yesterday.

770
00:47:10,893 --> 00:47:13,393
What's going on with this dog of a asset?

771
00:47:13,393 --> 00:47:15,413
He said Bitcoin is dog with fleas.

772
00:47:15,513 --> 00:47:15,953
That's what he said.

773
00:47:16,213 --> 00:47:17,533
All right, I got a great stat for you guys.

774
00:47:17,613 --> 00:47:19,393
So if you go back on one-year timeline,

775
00:47:19,573 --> 00:47:21,413
two years, three years, four years, five years,

776
00:47:21,433 --> 00:47:22,393
all the way to 10 years,

777
00:47:22,533 --> 00:47:24,973
every single year on that timeline,

778
00:47:24,973 --> 00:47:30,433
gold has outperformed the S&P. And why is that important? Because if you go back over a five or

779
00:47:30,433 --> 00:47:35,173
10 year timeframe, Bitcoin and gold on the compounded growth rate has been significantly

780
00:47:35,173 --> 00:47:39,533
outperforming. Now, the reason I bring that up is because we usually think of gold as not being

781
00:47:39,533 --> 00:47:43,713
super volatile. And we think of Bitcoin as being very, very volatile. But over these long time

782
00:47:43,713 --> 00:47:46,753
periods, what we find is that these assets actually do better than what are supposed to be the

783
00:47:46,753 --> 00:47:50,533
productive stocks. Now, that doesn't make investors feel good because Bitcoin hasn't been doing very

784
00:47:50,533 --> 00:47:54,733
well over the last two years. And so what I think people have to realize is that while AI stocks are

785
00:47:54,733 --> 00:47:58,833
flying and everyone's chasing momentum and it's hitting all time highs, usually the thing that

786
00:47:58,833 --> 00:48:02,053
you want to be buying is the thing that's out of favor, that's going to come back into favor.

787
00:48:02,493 --> 00:48:07,113
And so the big question is, if you think about Bitcoin, is the US government going to stop

788
00:48:07,113 --> 00:48:10,513
printing money? If they do not start printing money, which I don't think they're going to stop,

789
00:48:10,713 --> 00:48:13,853
that means that Bitcoin at some point in the future is going to be back. It'll be the pretty

790
00:48:13,853 --> 00:48:17,933
girl at the bar again. That's the catalyst. Yeah. They're always looking for the catalyst.

791
00:48:17,933 --> 00:48:23,793
All right, well, let's end up here with a little, before we totally wrap,

792
00:48:23,953 --> 00:48:27,753
I just got to give you a little dose of bullish Tom Lee.

793
00:48:28,113 --> 00:48:38,073
You know, old Tom Lee, whose BitMine ETH is now down $8.9 billion on $5,416,901 ETH.

794
00:48:38,513 --> 00:48:40,853
But Tom Lee, he's still feeling the pamp.

795
00:48:40,913 --> 00:48:41,833
He thinks it's coming.

796
00:48:41,933 --> 00:48:43,213
It's just a matter of time.

797
00:48:43,293 --> 00:48:45,553
It's just been slightly delayed, he says.

798
00:48:45,553 --> 00:48:52,053
So I think there are what I call, quote, rage quitting people selling here as if something is wrong.

799
00:48:52,253 --> 00:48:55,493
I mean, he's actually responding and referring to Mark Cuban here.

800
00:48:55,773 --> 00:48:59,213
One, I think that's what always happens at the end of crypto winter.

801
00:49:00,113 --> 00:49:04,013
You know, if someone asked me, is the thesis for Bitcoin or Ethereum broken?

802
00:49:04,653 --> 00:49:05,733
You know, it's absolutely not.

803
00:49:05,753 --> 00:49:13,853
Because one, the more work we do and we're hearing it from founders like Palantir, Bitcoin and Ethereum are really the future of money.

804
00:49:13,853 --> 00:49:16,153
because mass and compute or compute and energy,

805
00:49:16,313 --> 00:49:18,893
however Elon puts it, really are what's scarce.

806
00:49:19,573 --> 00:49:21,693
And you're going to need to control agent systems.

807
00:49:21,853 --> 00:49:24,973
And as AI systems evolve, right?

808
00:49:24,973 --> 00:49:27,953
We're now talking about using commerce and operating websites.

809
00:49:28,233 --> 00:49:30,593
You need decentralized identity and verification.

810
00:49:30,953 --> 00:49:32,393
That's really what crypto does.

811
00:49:32,613 --> 00:49:36,573
And we know Wall Street wants to go towards tokenization.

812
00:49:36,753 --> 00:49:40,993
It's a vast improvement in efficiency of actually how money moves.

813
00:49:41,413 --> 00:49:42,333
And it's an innovation.

814
00:49:42,333 --> 00:49:46,313
Well, that only happens on Bitcoin and Ethereum and other smart contracts.

815
00:49:46,593 --> 00:49:54,593
So the future isn't changed, but the spotlight today is, of course, on semis, memory, starting on software.

816
00:49:54,713 --> 00:50:00,013
But as people focus downstream into the future, that's really, I think, when the bid comes for Bitcoin and Ethereum.

817
00:50:00,433 --> 00:50:05,733
OK, so when people focus downstream on the future, Tom says that's when the bid comes.

818
00:50:05,733 --> 00:50:14,153
So what he's referring to when he says this is he believes that there's the two catalysts are going to be tokenization of all kinds of assets.

819
00:50:14,633 --> 00:50:26,133
And Tom's a big believer, and I'm not, he's a big believer that agents are going to be transacting on an ETH chain or maybe in SATs.

820
00:50:26,653 --> 00:50:30,693
Because when you talk about stocks, it was so easy for you.

821
00:50:30,693 --> 00:50:37,193
You did it, $10 times four, that's $40, put a multiple on it, that's 800 points.

822
00:50:37,833 --> 00:50:41,553
Why do you even try with Bitcoin or Ethereum?

823
00:50:42,633 --> 00:50:47,393
What's your comparable analysis to be able to come up with anything

824
00:50:47,393 --> 00:50:50,593
to make predictions about Bitcoin or Ethereum?

825
00:50:50,813 --> 00:50:53,153
There's nothing that you can base it on, Tom,

826
00:50:53,193 --> 00:50:56,433
except maybe psychology or sentiment or something.

827
00:50:56,433 --> 00:51:04,593
Yeah, well, there's, yeah, actually, market sentiment plays a huge role because it's sort of essentially risk premia.

828
00:51:04,953 --> 00:51:19,653
But before Tom continues, it's just interesting that even Joe there doesn't seem to understand that the best money ever created by humanity has utility and that utility gives it value as well.

829
00:51:19,653 --> 00:51:27,153
right it's the hardest money ever created it's it's refined prescription grade money

830
00:51:27,153 --> 00:51:33,493
it's the ultimate utility for money and that is valuable right there but tom has some other points

831
00:51:33,493 --> 00:51:39,653
there are two proven ways to value crypto one of course is just network usage because

832
00:51:39,653 --> 00:51:45,693
wallets and activity per wallet still explain like even now 87 of the rise of bitcoin so as

833
00:51:45,693 --> 00:51:50,393
long as more people use it and they're transacting it, the value of Bitcoin should go up. It's a

834
00:51:50,393 --> 00:51:56,633
network effect. And the second is the umbrella value of gold. You know, gold at when it has 5,000,

835
00:51:56,993 --> 00:52:02,833
if Bitcoin had the same network value as gold and gold is not as scarce as Bitcoin, that would put

836
00:52:02,833 --> 00:52:08,333
Bitcoin at around 2 million. So that's always interesting, but I just want to, I want to flip

837
00:52:08,333 --> 00:52:13,413
the script here as we wrap up. Just think about it this way. Over the past 12 months, the AI boom

838
00:52:13,413 --> 00:52:20,153
has added roughly $19 trillion in new market cap to the top 50 public equities.

839
00:52:20,813 --> 00:52:23,973
That's 13 times Bitcoin's total market cap.

840
00:52:24,753 --> 00:52:29,073
This CapEx cycle is vacuuming up liquidity like nothing we've ever seen and getting all

841
00:52:29,073 --> 00:52:30,853
the attention, getting all the headlines.

842
00:52:31,093 --> 00:52:36,393
So that really creates this institutional risk appetite that just isn't there for something

843
00:52:36,393 --> 00:52:37,473
like Bitcoin right now.

844
00:52:37,933 --> 00:52:42,773
I think the real surprise is that Bitcoin hasn't been weaker, really.

845
00:52:42,773 --> 00:52:45,653
19 trillion in new market cap?

846
00:52:46,393 --> 00:52:49,113
13x Bitcoin's total market size?

847
00:52:49,393 --> 00:52:55,833
I think the real surprise is that Bitcoin has been this resilient in general.

848
00:52:56,753 --> 00:53:00,213
I think it's absorbing one of the largest capital rotations in market history.

849
00:53:00,773 --> 00:53:02,553
And it's actually still standing.

850
00:53:02,893 --> 00:53:03,593
That's impressive.

851
00:53:12,773 --> 00:53:17,973
Well, let's check in on the state of the network before I get out of here.

852
00:53:18,793 --> 00:53:23,853
We are wrapping up at block height 952,247.

853
00:53:24,913 --> 00:53:33,073
That makes our current Bitcoin price to US dollars 65,990, putting our sats per dollar

854
00:53:33,073 --> 00:53:40,073
1,515, making our decline from the all time high 47.7%.

855
00:53:40,073 --> 00:53:41,573
How low can we go?

856
00:53:41,573 --> 00:53:51,453
well, we can go to 70. We can go further. All-time high 239 days ago. Retarget date now June 12th.

857
00:53:51,453 --> 00:53:56,773
With a difficulty downward adjustment of a major 9.8% downwards adjustment, we may see that

858
00:53:56,773 --> 00:54:03,653
turnaround. There are 28,185 reachable nodes on the network, and we are down almost 12%,

859
00:54:04,213 --> 00:54:11,213
11.9% in the last seven days, and I don't care. It's a summer of stack. We continue to stack

860
00:54:11,213 --> 00:54:15,713
right along. The truth is the fundamentals of the Bitcoin network, they're doing great.

861
00:54:16,133 --> 00:54:20,313
They really are. It's watching the network adjust and balance this stuff out is always

862
00:54:20,313 --> 00:54:25,913
really impressive. And so I like that term summer of stack. I think it was I think it

863
00:54:25,913 --> 00:54:29,153
was Mario that came up with that. I've seen summer of stack going around. I like it.

864
00:54:29,993 --> 00:54:34,513
Links to what I talked about today this week in Bitcoin.show. I apologize for some of the

865
00:54:34,513 --> 00:54:39,293
technical issues. I'm running a new control board that does some various things I used to still

866
00:54:39,293 --> 00:54:44,133
have to learn or relabel buttons. So I apologize, but hopefully it was still enjoyable and insightful.

867
00:54:44,273 --> 00:54:47,813
I think there's some signal in here. And my goal is to give you a show that doesn't get distracted

868
00:54:47,813 --> 00:54:54,973
around the emotion, doesn't get distracted by the politics or the drama, but tries to find the

869
00:54:54,973 --> 00:54:58,973
signal in all of that. So that way you can plan for yourself, your friends, your family, your

870
00:54:58,973 --> 00:55:02,833
business, whatever it might be. So you can let me know how I did there with a boost as well. And of

871
00:55:02,833 --> 00:55:08,673
course, I want to hear your thoughts if Bitcoin gets to a million by 2032-ish boosting and let

872
00:55:08,673 --> 00:55:09,353
We know about that.

873
00:55:09,953 --> 00:55:12,013
Now I'm going to leave you with a value for value track.

874
00:55:12,113 --> 00:55:14,333
If you boost him, 95% of your sats will go.

875
00:55:14,364 --> 00:55:15,064
to our artists.

876
00:55:15,424 --> 00:55:16,504
And this week,

877
00:55:16,604 --> 00:55:17,684
it's from the Dorfels.

878
00:55:17,844 --> 00:55:18,464
It's been a while.

879
00:55:18,644 --> 00:55:19,564
And it's their track,

880
00:55:20,044 --> 00:55:20,884
What We Are.

881
00:55:21,524 --> 00:55:22,244
See you next week.

882
00:55:22,484 --> 00:55:23,064
Thanks for being here.

883
00:55:24,064 --> 00:55:26,004
We were fumed on fire.

884
00:55:26,684 --> 00:55:28,984
We were bullets from a gun.

885
00:55:28,984 --> 00:55:31,464
We were rising higher.

886
00:55:32,104 --> 00:55:33,984
Getting further from the sun.

887
00:55:44,364 --> 00:55:50,324
We were midnight riders, like the lightning in the dark

888
00:55:50,324 --> 00:55:56,424
Though the moon shined brighter, they called us shooting stars

889
00:55:56,424 --> 00:56:06,264
What we are, isn't who we are

890
00:56:06,264 --> 00:56:11,584
What we are, is never who we are

891
00:56:14,364 --> 00:56:19,384
You're an all-night fighter

892
00:56:19,384 --> 00:56:22,244
I'm running out of breath

893
00:56:22,244 --> 00:56:25,284
We're still chasing flames

894
00:56:25,284 --> 00:56:27,444
But there's ashes in our bed

895
00:56:27,444 --> 00:56:29,584
Uh-uh-uh-uh

896
00:56:29,584 --> 00:56:32,664
Uh-uh-uh

897
00:56:32,664 --> 00:56:35,364
Now I'm an empty bottle

898
00:56:35,364 --> 00:56:38,664
So I drink to pass the time

899
00:56:38,664 --> 00:56:41,284
You're a lonely heartbreak

900
00:56:41,284 --> 00:56:52,168
You can look me in the eye What we are isn who we are

901
00:56:52,588 --> 00:56:57,708
What we are was never who we are

902
00:56:57,708 --> 00:56:59,588
You look for fire

903
00:57:00,348 --> 00:57:02,348
Now those ashes and I fly

904
00:57:02,688 --> 00:57:04,848
You look for fire

905
00:57:05,588 --> 00:57:07,588
Now those ashes and I fly

906
00:57:08,288 --> 00:57:10,128
You look for fire

907
00:57:10,128 --> 00:57:12,768
Now there's ashes in a bed

908
00:57:12,768 --> 00:57:15,268
You're feeling a fire

909
00:57:15,268 --> 00:57:18,208
Now there's ashes in a bed

910
00:57:18,208 --> 00:57:21,288
We both found a food on fire

911
00:57:21,288 --> 00:57:23,988
Now there's ashes in a bed

912
00:57:23,988 --> 00:57:26,608
We both found a food on fire

913
00:57:26,608 --> 00:57:29,388
Now there's ashes in a bed

914
00:57:29,388 --> 00:57:31,388
What we are

915
00:57:31,388 --> 00:57:34,248
Is it who we are?

916
00:57:35,248 --> 00:57:36,808
What we are

917
00:57:36,808 --> 00:57:38,688
We're never, we're never you

918
00:57:38,688 --> 00:58:08,668
I'm out of breath.

919
00:58:08,688 --> 00:58:17,828
Ashes in our bed.