Welcome in to This Week in Bitcoin, episode 84.
My name is Chris.
That's ChrisLAS.com and JupiterBroadcasting.com.
Things were going well.
Since we got together last week, everything seemed to be kind of turning around.
And then Sunday night, it just got a little wild.
I was wrapping up Linux Unplugged and I decided to look at the Bitcoin price because Sunday is always a great time to check.
It can kind of get a hint of how Monday morning is going to go.
And so I pull up the old spot price and I saw a steep decline.
And I knew something must be going on in the broader world.
And, you know, when Bitcoin drops like that, it is always the canary in the coal mine.
Now, Bitcoin traders woke up to a rough night.
And a sudden liquidity shock in Asia sent Bitcoin down to $83,000, triggering panic and wiping out billions in long positions.
But then the U.S. markets opened.
Well, hold on, hold on.
Let's not just blast past that first detail here.
What happened Sunday was a signal.
And I think we really need to understand that signal.
So we're going to go over some fundamentals.
And to do that, I want to just sort of set the scene.
And let's think about something.
Let's ask ourselves a question.
Why has Bitcoin ripped to all-time highs during a Fed rate hike cycle and during quantitative tightening?
All the haters said Bitcoin would only thrive in a low-rate market.
They said it was the phenomenon of a low-rate policy and that without low rates, Bitcoin would die.
But yet, Bitcoin got up to $126,000 during quantitative tightening during tighter Fed rates.
Now, here we are at the end of a tightening cycle.
Quantitative tightening is ending.
Bitcoin's just within a couple of days of going to 100,000 or, you know, the other direction.
So why?
Why did Bitcoin pump during all of that?
Well, you know the answer.
It's always the liquidity.
And today we want to talk about two big contributors.
One was bad girl Yellen.
The Treasury Secretary was the driver of liquidity in going to assets while the Fed was trying to tighten.
I often referred to that as one foot on the gas, one foot was on the brake.
And that was really true even after Yellen until the government shutdown.
But there was another large factor that we need to zoom in on this week, because after
all, Bitcoin is a worldwide asset and the market, the market's really good at finding
cheap money plays.
Earlier this year, I talked about the start of the yen carry trade unwind.
And I noted this kind of thing would take time.
Well, time flies.
But Japan's latest numbers are not exactly fun.
Japan's latest data shows the economy contracted 1.8% annualized in quarter three.
That's the first drop in six quarters, which they suggest has been driven by tariff hit imports or exports for the U.S.
Now, the newest 10-year JGB, that's their bond, hit 1.89%.
Now, that is important because that's the highest level since mid-2008, i.e. the financial crisis.
And that has been climbing for a while now, driven by looser fiscal policy.
And then, you know, of course, that's always led to all kinds of market games.
However, with the rates near zero, that made the yen very cheap for traders.
And so we have a situation where it appears the Bank of Japan may be changing that policy.
They may be raising rates.
They've hinted towards that.
And they're doing that same thing where the government is stimulating and the bank wants to tighten.
Again, we have another bank and government conflict where there's a foot on the gas and a foot on the brake.
And when the reality is, is the Bank of Japan is stuck between two really bad options.
They're going to have ramifications for all of us.
Now, most people don't know this, but the Bank of Japan owns around 7% to 8% of its entire stock market through ETF purchases.
That's significant.
That means that the Japanese government is basically a giant shareholder in its own economy.
But when bond yields rise and debt becomes more expensive, they're being forced to sell equity to plug the holes.
They must raise cash.
This means selling stocks, in fact, billions worth of stocks.
Selling stock pushes markets down.
Falling markets push investor confidence down.
Falling confidence pushes the yen up.
And when the yen rises, well, the carry trade starts to blow apart.
At this point, Japan's central bank is trapped in a brutal scenario.
They could raise interest rates.
That strengthens the yen.
A stronger yen kills the carry trade, however.
And a carry trade unwind causes global selling.
But rising rates also make their government debt unaffordable.
They push bond yields even higher.
This crashes the bond prices,
damages banks and balance sheets,
and enforces even more asset sales.
Option two, they could ease or they could stimulate.
This weakens the yen.
It keeps the carry trade alive,
but it also pushes inflation higher,
requires more money printing.
This damages, of course, purchasing power,
which we've talked about, the silent inflation.
This weakens the yen, but it keeps the carry trade alive.
But it also pushes inflation higher, requires more money printing, damages purchasing power, threatens their credibility as a nation, and risks a currency crisis.
So that was basically the play since we talked about the yen carry trade.
They just kept rates low.
They kept the yen down, which helped the carry trade survive.
But now the bank is warning the market that at their next meeting in December, they're likely going to start raising rates.
That means the yen is going to start increasing in strength.
And they really have no choice because they brought everyone to just about as much as they can bear when it comes to inflation.
Here's a report from Japan.
The yen has been getting steadily weaker against the dollar.
That has big implications for the economy, businesses and households.
That's right. And households are especially feeling the pinch as the weaker yen means higher prices for all sorts of imported goods from groceries to gasoline.
Yuko Fukushima from our business desk joins us now to examine what's behind the weak yen. What could happen next?
Yes, traders, investors, money managers are all watching the currency market closely as they see the yen getting close to the level where the government and the Bank of Japan intervened last year to prop it up.
The yen toppled to a low not seen in 10 months last week.
Their worries that the economic package rolled out by Prime Minister Takaichi Sanaya will lead to a worsening of Japan's finances.
Yeah, so you got a prime minister that wants to pump and you got a central bank that wants to tighten.
Where have we heard that before?
And the Bank of Japan is really stuck.
People are sort of at their limit of what they can afford to swallow.
And so they have signaled in their December 18th and 19th policy meeting that they're likely going to hike the interest rate.
That's freaking traders out.
Markets are now pricing an 82% chance that the Bank of Japan will raise rates.
And so you really need to understand the ramifications of this.
This is why you tune into this podcast.
There's going to be hedging.
And some are hedging for a prolonged bear market, like all of 2026.
Now, we'll get to that.
But I thought a YouTube channel, Mind2Free, he lays it out.
Now, he's got kind of an odd cadence and style.
But if you lean into it and just kind of lock in, I think he really helps put things into perspective of why this matters.
We need to unpack the mechanics of the carry trade to understand why a change in Japanese interest rates causes a stock market drop in New York.
One must understand the mechanics of the carry trade.
This is not a small niche strategy used by a few day traders. It is a colossal financial engine
estimated by some analysts to be worth over $20 trillion in total global exposure. It is a
mechanism that has provided a massive amount of liquidity to the world's financial system,
acting as a hidden subsidy for risk-taking. The concept is deceptively simple. For decades,
Japan has battled economic stagnation, a period often referred to as the lost decades. To combat
this, the Bank of Japan maintained an ultra-loose monetary policy, keeping interest rates at zero
and at times even in negative territory. This meant that borrowing money in Japanese yen was
effectively free. Institutional investors, hedge funds, and global banks recognized a golden
opportunity. They could borrow billions of dollars worth of yen at mere zero percent interest.
They would then take that borrowed capital, convert it into United States dollars or euros, and invest it in assets that offered a higher return.
For example, an investor could borrow yen at 0% and buy United States treasury bonds yielding 4% or 5%.
The difference between the borrowing cost and the investment return, the spread was pure profit.
Of course, that's how it started. Nice, safe plays. But this became an institutional norm. It went on for years, well, decades. It went on forever. And so it just became expected, which meant they took more and more risk.
But investors did not stop at safe government bonds.
Emboldened by cheap leverage, they poured this borrowed money into the stock market,
into real estate, and into speculative assets like cryptocurrency.
Because the cost of borrowing was so low, they leveraged their positions, borrowing many times
their actual capital base to maximize returns.
You ever wonder where some of these institutions get all the money to buy these massive bags of Bitcoin?
Some of it comes from this.
I mean, it was sweet, easy money.
You get super cheap money and then you turn around, you put into something that even if it only returns you a 10 percent return, like you has a massive spike and drop, you still win.
However, for that trade to actually work, it relied on two pillars to remain profitable.
profitable. Number one, the interest rate gap between Japan and the rest of the world
has to remain wide. There has to be something to play there. And then number two, the yen has to
remain weak against the dollar, obviously. If the yen strengthens, then the borrower has to pay back
their yen loan with a more expensive currency, which will eat into their sweet, sweet degen
profits. And I say degen, but this has been normalized by the industry because it's worked
great for years. But those pillars are now crumbling with the Bank of Japan announcing
they're likely going to raise rates, which will strengthen the yen. So the math is obvious here.
The yen carry trade is going to break if they do this. We'll see, because at the same time,
the government of Japan is set to stimulus mode. They're just trying to find ways to do stimulus.
So it's hard to really see how this plays out. But in the short term, traders are going to hedge
against this problem. Now, in the midterm, this puts more pressure on the U.S. Federal Reserve to
not just lower rates, but possibly, possibly it puts pressure on them to begin quantitative easing
once again. And I don't have to tell you that Bitcoin was really built for this. It doesn't
mean everyone's going to understand it when it happens. Gold has a bit of a lead here, obviously.
But the market is incentivized over time to find the best money. And Bitcoin is the hardest money
ever created, and Bitcoin has time on its side. Well, that big old dip caused by the Japan news
was totally erased by the capitulation of Vanguard. Bitcoin jumped 6% the day that Vanguard lifted
their ETF ban, which was, I believe, Tuesday, within just 30 minutes of trading. The Bitcoin
ETF volume on total, including BlackRock, surpassed $5.1 billion yesterday.
Wow.
Now, to really appreciate this, I think we should go back in time, if you will allow.
I love myself a little time travel.
We should go back in time to Vanguard in 2024, just about a year ago, crapping on Bitcoin
and talking about why they would never offer products with Bitcoin.
Spot Bitcoin ETFs.
Question came in, hey, we know you're not offering one.
Have you changed your mind?
What would it take for you to change your mind?
This is Tim Buckley, the chairman and CEO of Vanguard.
We don't plan to, and we don't, like,
we're not going to change our minds around this
unless the asset class changes For why First of all we don believe it belongs Like a Bitcoin ETF belongs in a long portfolio Someone saving for the retirement
It's a speculative asset.
That's exactly it.
And the funds that we offer invest in asset class.
I love the yes man who's paid to interview his boss
that just sits there and agrees.
That's exactly right, boss.
You got it, boss.
Someone's saving for the retirement.
It's a speculative asset.
That's exactly it.
And the funds that we offer invest in asset classes
that actually have underlying cash flow.
So like we mentioned stocks,
you're buying the forward earnings of a company.
That's right.
And that bond, right?
As coupon and principal payment.
Yeah, you're going to pay me something.
And that thing has these elements
that we've completely manufactured that pay us profits.
I just, I can't wrap my head around an asset
that just gains.
Like these guys, these top tier finance people,
when they start talking about Bitcoin,
they seem to completely forget real estate exists,
gold, other precious metals exist, oil, like the commodities are things like they just like,
it's so incredible how they get locked into one dimensional thinking, even though presumably this
guy is filthy rich because he's some kind of expert. That's right. And that bond, right?
Has coupon and principal payment. Yeah, you're going to pay me something for lending you the
money. Exactly. Right. So they both can be valued. And that's for us, we understand why they would
rise up in a portfolio and the role they play and we can model them.
We really prefer to have all of our clients' retirement live and die on the decisions of
a few people in a couple of companies and the market whims of a president.
That's what we really believe.
Something like Bitcoin is just too volatile and it's not a store of value.
It hasn't been.
And it's very volatile.
When stocks got hammered in recent crises, Bitcoin went right with them.
Okay, so Austin Real Estate's at like a three-year low.
Does that mean real estate's too volatile?
Does that mean real estate's not a good investment?
Does that mean real estate isn't a scarce asset?
Uh-oh.
Well, everybody sell your houses because real estate goes down sometimes.
Ox got hammered in recent crises that Bitcoin went right with them.
And so it is speculative, really tough to think about how it belongs in a long-term portfolio.
Oh, it's tough. It's really tough.
The traders love the vol.
The best thing is, is Vanguard themselves released that video.
That's not like a clip from like an interview.
That's like something Vanguard produced and released on their website to explain why they would never offer Bitcoin products.
Well, flash forward to today.
The institutional guys, boy, a year and a half ago, two years ago, they wouldn't touch this stuff.
And now suddenly they're in it, including the world's second largest asset manager, Vanguard.
Yeah, that news this morning with all the other talk about all of this volatility in crypto markets largely uncovered.
Vanguard with $11 trillion in assets and management announcing this morning that they will custody not only crypto related ETFs, but Bitcoin itself.
Why is this important? Liz, Vanguard has 50 million customers in the United States.
That's 50 million new retail accounts that will have the ability to have exposure to Bitcoin and the larger cryptocurrencies.
You got to really understand this is huge because when Vanguard enters a space, they're considered like the conservative actor.
And so it makes people reevaluate their models.
It makes all of the other analysts rethink the trade.
I mean, it's hard to explain the gravity of Vanguard in these types of markets.
There's a few things on Wall Street that are a guarantee.
You've heard me say this before.
When you have regulatory clarity and institutions know whether something is a stock, an option, fish or fowl, and you can hold it in your retirement account, it drives demand and appreciation asset value.
We expect that to happen.
And also on the same day that Vanguard released the ETFs, Bank of America and I think what they also own Merrill Lynch or Merrill Lynch owns them, $1.5 trillion under management.
They announced that they're not only going to allow their clients to hold and trade crypto, but they're actually going to recommend that some of their clients hold up to 4 percent Bitcoin in their portfolios.
Bank of America.
Bank of America will begin endorsing crypto ETFs for select clients.
The firm's chief investment office will start recommending a digital asset allocation
of 1 to 4 percent to interested Merrill, private bank and Merrill Edge clients.
Beginning January 5th, the company's advisors will be able to recommend a handful of Bitcoin
ETFs from different asset managers. The company's head of investment solutions group says the update
came from a growing client demand for access to digital assets, while its chief investment
advisor emphasized the allocation is for, quote, investors with a strong interest in thematic
innovation and comfort with elevated volatility. Yeah, right. I mean, again, the traders love the
vol. They sure do. So that's pretty huge. And then today, $12 trillion fund manager,
these are just crazy numbers, Charles Schwab says they're going to offer Bitcoin and Ethereum
trading in early 2026. So I believe that now makes eight out of the 10 major banks, maybe even nine
of the 10 major banks in the United States now offering crypto trading, lending, or holding.
And what's really wild about that is most of them flipped their stance in just the last six months.
That would be fast. I used to work at a bank. It was a regional bank, and they are so slow.
Fast for a bank is four or five years. Six months, that's really, really unheard of. It's
something else. And the impact of that is noted. And the internet never forgets.
So BlackRock has announced that the iBit Bitcoin ETF has become their most profitable product.
Let that sink in for a second. And the hilarious thing about that is that whenever CEO Larry Fink
is out and about, who was, as you know, a loud public hater of Bitcoin, he has to continually
eat public crow. And just about every public event he goes to, he gets asked questions that
put him on the spot about his previous critical stances. And I'm not kidding. I probably have half
a dozen of these clips in the archive. But this one, this one's from today. And I'm going to put
this link in the show notes in case you want to play it for some of your doubt or family or friends
at the holiday event. I mean, why not be that guy, right?
Called crypto an index for money laundering. BlackRock and thieves and thieves. Yes.
money laundering and thieves you now have the biggest bitcoin etf so what happened here
i have very strong views but that doesn't mean i'm not wrong i but by having strong views you
have to test yourself and ask yourself and you know in my role i see you know thousands of
clients a year i have you know governmental leaders and we have these conversations that
my thought process always evolves.
And this is a very glaring public example
of a big shift in my opinion.
Well, did you feel the shift?
Do things feel a little looser?
The Fed officially ended quantitative tightening the first time since 2019 on December 1st.
Now, usually when that happens, it takes a little while.
We don't have a lot of data here, but it tends to take a little while for that to trickle down to everybody else.
But at the same time that was transitioning, the U.S. Federal Reserve had to inject $13.5 billion into the banking system through the overnight repurchase agreements.
This is crazy.
You could almost call it stealth easing.
And it's the second largest liquidity injection since the COVID pandemic.
So with tightening wrapping down and the Fed having to make the second largest injection since COVID, it probably is fairly easy to argue the quantitative easing, i.e. money printing, could be just around the corner.
And your DGEN buddy Tom Lee thinks so.
I am.
I think the biggest tailwind that's going to emerge in the next couple of weeks is around
the central bank.
The Fed is set to cut in December, but also today is the day that quantitative tightening
ends.
You know, the Fed's been shrinking its balance sheet since April 2022.
It's been a pretty big headwind for market liquidity.
The last time we had an end to QT, quantitative tightening, was September 2019.
And if you look back at that period, the markets really responded well, I think within three weeks rallied more than 17%.
So I do think the timing of QT ending, which is now essentially QE starting in the Fed, and at a time when November kind of was topsy-turvy.
So I think people got cautious, but now have to performance chase.
And then you have a really typically a seasonal tailwind.
So I'm pretty bullish into December, even with maybe the first day being rocky.
It is really unbelievable the amount of what you would call tailwinds that have built up for Bitcoin over the last year when it comes to institutional support.
But yet there really seems to be concern that we're going into a prolonged bear market.
And Sailor's strategy has still been under heavy scrutiny this week.
Their market cap is now worth $10 billion less than their Bitcoin holdings.
That puts the company's market cap at around $45 billion, and strategy holds 650,000 Bitcoin-ish, around $55 billion or somewhat more than that.
So that's incredible.
And one of the things they've done to ease concerns is they've set up what they're calling a dollar reserve of $1.44 billion to back various payout plans they have for their different instruments should we enter a prolonged bear market.
And now with that seemingly for the first time, they are being clear at what point would strategy have to sell its Bitcoin?
If there is literally a three year sustained Bitcoin down cycle, a three year sustained cycle where MNAV trades below 1x, then we may have to sell Bitcoin.
At this point in time, it's the end of 2025. We're talking about 2029 where that may be the case.
And we have the Bitcoin for a reason to protect the company, to protect our shareholders.
and if we have to sell them.
So if we had to sell, we would,
but only after a prolonged bear market to 2029.
But they are kind of bracing for that.
And I'm not sure if it's just to ease investors' concerns
or if they think maybe the sell-off of indexes in February
is going to rock them hard,
but they actually seem to be bracing for a Bitcoin dip.
I think people just need to get a bit of a grip here.
This drawdown, this is nothing so far, kids.
It could be a lot worse.
It could also get a lot better.
And yet you have strategy bracing for that prolonged drawdown.
JP Morgan just released a product last week that assumes Bitcoin goes through a rocky 2026.
And whales continue to sell Satoshi-era coins like the four-year cycle is right on the money.
And we even have some of the chart influencers and casters out there who are crying crypto winter and selling off their Bitcoin stashes and then going on social media and telling everybody about it.
This I mean, this happens in Bitcoin every time we get to a 30 percent or in the range of a 30 percent drawdown.
The demons, they just come out.
And I think everybody needs to just put things into perspective.
All right.
What do you make of this decline when it comes to crypto?
We keep talking about these leveraged positions being unwound.
Does that change the narrative of crypto's rise at least this year?
the fact that there's so much leverage in this market? Yeah, so I think you need to put it in
perspective where really since the start of last year, Bitcoin is still up over 100% since then.
And over the past few years, I mean, it's been a tremendously performing asset. And so I think
you also have to remember that, look, a lot of people in Bitcoin have been around it or have been
in it for years. And typically what you kind of see at the later stages of a Bitcoin bull market
is you start to have these big, long-term, chunky holders start to align.
And again, this happens every cycle.
And we have started to see it in this cycle.
We really started to see that really pick up in July.
And it's typically just a transfer of wealth from, I would say,
stickier owners to maybe less stickier owners.
That's it.
Or, you know, from hands that get, you know, the latest hands to diamond hands.
This is how it works in Bitcoin.
And in 20 years, when you stack some sets and people say,
oh, you got rich from Bitcoin, that was easy.
Play them these episodes.
How else do you distribute an asset like Bitcoin?
It doesn't have a central planner.
If it never had drawdowns,
we'd live in a world of sailors
who just sit on piles of coins.
It's better for the market long-term
to have these redistributions.
And if Bitcoin were to just pump and pump
and say it went from 30K to 60K to 100K to 150K
and it just kept cooking,
you should brace for the most wild retrace
you've seen in your Bitcoin lifetime, because when it cooks like that, it drops like that.
So when you blow off a little steam on the way up, you give us a better foundation.
We build out because we transfer from the weak hands to the stronger hands.
And you redistribute coins from long whales to new hands And it always worked this way Bitcoin down 5 I haven got a clue why I presume someone smarty pants out there will say it because of some forced liquidation It because of so and so
But when an asset class can move so aggressively and I haven't seen any decent copy, and I'm
going to say this on CNBC, on the FT, on Reuters, on Bloomberg, on every one of those major
market sources out there.
Let's pause here.
I love how he hasn't seen any major copy.
By love, I mean hate.
That means he's not doing his own research.
He's waiting for somebody to explain it to him, first of all.
On CNBC, on the FT, on Reuters, on Bloomberg, on every one of those major market sources out there.
I've seen no one coming up with a conclusive idea of why a major, major asset is down 6%.
That, for me, is the problem with crypto.
The fact that random events can move so aggressively and no one's got a clue why.
Maybe he should listen to This Week in Bitcoin.
I mean, this guy is ridiculous.
First of all, a 5.8% move in a liquid globally traded asset that goes 24-7 that can respond to the Bank of Japan news causing an unwind in one of the largest trades in history.
That's not a nothing burger there, buddy.
And it's pretty understandable.
These people, especially guys like this, they need to reframe their thinking.
They're thinking in terms of stock markets that have circuit breakers, that have hours.
and realistically, if we look at Bitcoin
and the performance it's had over the last year,
it's the new buyers, the new hands that are hurting.
Investors holding Bitcoin for one to three months,
they're in about a 20% to 25% loss right now.
That is the deepest drawdown of the current cycle,
no doubt about it.
It's uncomfortable for them.
But if those idiots were buying Bitcoin
and expecting huge returns in three months,
they were buying the wrong thing.
It's just the reality of Bitcoin.
I mean, you're lucky.
It tends to work out, but you're lucky if you get a decent return in four years.
You know, that's kind of the target I set.
But I also wouldn't buy Bitcoin for a four-year timeline either.
You know, eight years, 10 years, get a few cycles.
I think it's, you know, hold it for longer than that.
And guys like that ranting about a 5.8% drop, which, by the way, which, by the way, made all up and then some the next day.
And you didn't hear anything from that guy when that happened.
OK, it was down 5.8%.
The next day it was up 6%.
And where's that guy's rant then?
So here's my question.
Are you buying the dip for the holidays?
Are you giving any Bitcoin?
When it started turning around later last week, I realized, oh, crap, did I miss my window to get Bitcoin cheap?
So I'm kind of glad I might have another window here.
Maybe I'll have one, a long one.
I don't know.
But I like to get a little bit of Satoshis for the kids every holiday.
I put it in a wallet for them, make sure it's all safe.
And as they get older, I teach them how to custody that.
And it's a nice thing because every year they get to look at their Bitcoin.
It's generally a little bit higher.
And it starts to click what that means.
And I'm wondering if you give any Bitcoin.
Like I've thought about giving it to like my dad.
I think I did years ago and it just didn't really seem like it landed, I think.
And I'm thinking about maybe my father-in-law.
But again, he's kind of a gold guy.
I just don't know.
So do you give any Bitcoin for the holidays?
Boost in and let me know.
We got a lot more show coming up.
So let me just mention, you can support the show by doing what you do.
You want to give some sats for the holidays?
River's a great way to do it, either to yourself or to somebody else.
Just use my link in the show notes.
Now, if you're all about self-custody, the Bitcoin will.
It's available in the U.S. and Canada.
They're all about self-custody.
They don't even host a wallet.
You do all of it.
Now, you want to spend some sats, like on Amazon or hundreds of other places.
you can go from lightning to gift card in seconds with the bitcoin company link in the show notes
then if you want to stack sats as you pay bills fold cards the way to go there and if it's time
to get access to some of your bitcoin value without selling it salt lending is where i go
they have rates that are great they have the amount that's what i'm trying to think of the
amount of the loan you can take is like five thousand dollars out instead of stripes like
minimum ten thousand strikes i mean it's just there are a lot of things i like about it and
It's something you should always look into.
But if you want access to some of that Bitcoin value without selling, you know, take a look at Salt Lending.
I still think they have one of the more competitive products out there.
Those links, yeah, they're in the show notes.
All right, we do have some boosts to get into this week.
No baller boost this week, but we have plenty of great messages.
And one of them is from Marius February, and he comes in with 10,000 sats.
I believe that makes you probably the first booster of the episode.
And he comes in with a, you know, like a hang tight kind of symbol.
Boy, I'm tired. I don't know.
My wife's been sick, so I haven't slept much.
But I think that's like what the hang loose.
hang loose. That's what it is. Thank you very much. I think that makes you our first booster,
Mary. So I appreciate that. And then Gene Beans here with a row of ducks coming in right after
says plus one for going from exchange to cold storage via liquid and happy Thanksgiving,
Chris. Right, Gene? It's a great setup. It's a great way to consolidate your UTXOs and kind of
just, you know, forget about that history, that transaction history and get a totally, totally
new transaction.
And what I have been doing is like,
you know, just small bits in here, like when I get
zaps or something like that, I'll consolidate for a while
in liquid. And then when it gets
to a larger amount, I'll move it over.
And it's not very complicated.
It's pretty quick. And now
this process, I've probably been using it for a couple of years.
It's worked really good for me. So plus one to your plus
one, Gene Bean.
And thank you for the boost.
OB's here with 16,000 SATs.
Blue Wallet. This is the way.
You know, I don't think Blue Wallet gets enough love.
I was just thinking about this yesterday.
Blue Wallet is pretty good.
This is the way.
It's not my favorite, but it's a pretty solid wallet.
Thank you, Obi.
Nakamoto 6102 is back with 3,500 sats.
Thanks for the value.
Well, thank you, Nakamoto.
Sohang's back with 2,000 sats.
Okay, Chris, I figured out why I listen to this here show
despite not being into Bitcoin.
I, too, reject mainstream economics,
although with more hammer and stickle approach, sickle.
And hearing you call it mainstream economics on their BS is somewhat cathartic.
Economics are the original hallucinators.
You heard it here first, he says.
Anyways, I recently discovered my Steam inventory is worth like $100.
So I may cash that out to a self-hosted Nebula VPN-powered Bitcoin node.
Just got to find the time.
I think you'd really like the process.
And it gives you a sense of independence too, which is a really powerful thing.
Let me know.
And I'm glad you're listening.
Thank you, sir.
Appreciate the boost.
All right, Faraday Padora's here.
Coming in hot with the boost.
2,000 sats.
I'm DCA-ing once a day at the moment.
What I would love to do is be able to DCA every block.
Just a little sats, symbolically buying my silver of the new sats being mined.
Apologize.
I'm a little loopy.
You know, I like this idea.
I suppose you could just set it to, you know, 9, 10 minutes, and on average, you know, you'd probably get it.
I think Strike will let you do that.
You are going to have a lot of little UTXO, so you will want to consolidate.
That's for sure.
I did try it for a little while before I really thought about it,
just because I love the idea of every hour.
When things were really moving, just like every hour.
It's a big mess.
Thanks, Faraday.
Appreciate it.
Hey, Turbo's here.
2,121 sats.
Who does your retro music?
Are there any of the tracks on here so good?
Retro music.
Are you talking about the show song or are you talking about the music I play at the end is always linked in the show notes?
And the show music is created by Mr. Ronald Jenkins.
And thanks, Turbo.
Nice to hear from you.
Hodler's here with a row of ducks.
That's 2,222 sats.
Greetings from Iceland.
Chris, you're absolutely killing it.
Keep up the good work.
Well, thank you for sending the value my way.
I appreciate that.
Army guys here with 6,500 sats.
With Strike, they typically, I was asking last week about how Strike withdrawals work.
With Strike, they typically do batch withdrawals, but unless you pay it for the next block fee, withdrawal will get paid out with others.
If 10 people, say, take out 500,000 sats and you move 1 million sats, you'll see your 1 million as one of the outputs of the transaction when viewing it on the blockchain viewer.
Keep up the good work, sir.
Enjoy your show.
And I'm enjoying the dip.
Good.
Yeah.
So they batch that is what the exchange calls it.
This is how they save on fees, and one of the ways they can offer free withdrawals to your cold storage is they batch it up with a bunch of other people.
So 10, 15, 20, 30, 40, 100 people around the same time withdrawal that you do, they just process all of that once and pay the fee once.
And he also comments, Andreas is the goat.
People will put garbage.
Bible verses, wait, he already said that.
Yeah, he didn't need to say that part for the message to go through, but Andreas has always been very strong in his opinions.
And he often sneaks a little bit of wit and humor in there, too.
Ace Ackerman's back with a row of ducks.
Ace says, no more price predictions from me.
After making the most technical analyst look foolish for this four-year cycle,
I'm just going to sit back and watch the show.
And that really is the plan, right?
Good for you, Ace. Nice to hear from you.
Hey, Retrogears here with 5,000 sats.
The traders love the vol.
Hey, Chris, I've been looking for a product in Australia similar to Fold
that you always mention.
So I've settled on Coinjar.
They have a prepaid MasterCard that you can instantly set up and use.
It uses on-chain Bitcoin to fund purchases directly.
Seems like a good product and a trusted company since 2013.
Of course, it is custodial, but unavoidable, I believe.
I've been keen for other Aussies to boost in and let me know what they use.
AlbiHub is still my main savings account.
Skip the coffee and stack the sats.
Yes.
This is the way.
Coinjar, huh?
If anybody else has some experience on that, I would really like the feedback because, you know, I do not have a way to test that stuff.
What a dream it would be to be able to travel around the world and try this stuff out and report on it.
That would be so great.
Oh, I'm in.
All right.
Thank you, RetroGear.
And do report back in how CoinJar works out for you.
I appreciate that feedback, too.
Nice to hear from an Aussie.
Bobby Pins here with 5,000 sats.
Ten gold blooms out of a possible ten gold blooms.
Quantitative tightening is over.
Bring on the money printer.
You know, I think you're probably right.
I don't know how soon, but I think you're probably right.
The lever you have pulled breaks is not in service.
I don't think anything stops that.
Thank you, everybody, who boosted in.
All of you two below the 2,000 cutoff.
I keep those and save those as well.
And, of course, a huge thank you to everybody who streams sats.
41 of you just streamed as you listened.
And collectively, you stacked 89,931 sats for the show.
You really did the bulk of the lift for this episode.
So thank you very much.
When you combine that with our boosters, we stacked a humble 151,444 SATs.
And, you know, this isn't your fault.
I will say, 151,000 is a little disappointing.
And again, this isn't your fault.
But you had no way of knowing this.
I lost last week's episode.
and I was exhausted when I finished it
because I put a lot into it.
And I lost it and I went through the process
of deciding if I was going to skip the episode for the week
or if I was going to try to recover the data.
And I started looking into the process
of recovering the data on the hard drive
because it was an application issue.
But it looked like it was going to be a two-hour process
to recover the data.
So I sat down, turned the mic back on,
and I did last week's episode a second time.
So I spent like four hours recording last week's episode
So I was hoping it would be kind of a banger in the boost department, even though that has no bearing on you.
And I didn't even bring it up in the episode because it wasn't your problem.
But, you know, this I think this kind of exposes one of the things that's good and bad about the show is this show is my proof of work.
And I have to be more transparent about that kind of stuff, because when you boost, that's essentially my block rewards.
and I'm on public record talking and explaining
and putting Bitcoin into context for 14 years now.
I don't think many people have a 14-year track record
of calling balls and strikes in Bitcoin.
And just as a little proof of work for you,
this is myself and my co-host Alan 14 years ago
in our TechSnap podcast.
So it is a long time ago, so I apologize about the quality.
I've learned a lot.
I also didn't get the analysis 100% right,
but it was 14 years ago.
And I was explaining why everyone should probably just calm down because Bitcoin was crashing after pumping to $30 and everyone was declaring the end of Bitcoin.
I go once again back in time just as a small demonstration of my proof of work to 14 years ago.
You mine gold and you mine Bitcoin.
There's a lot of parallels there.
But the other thing to consider is even if Bitcoin were to shoot way, way up and get to say $100 to a single coin and then just come crashing down, it's a peer-to-peer open source system.
It not like there a PayPal company that going to fail because of it So there always be a small network of people probably trading in these Bitcoins I think at this point Bitcoin will never ever go away because there is a need for an anonymous direct peer currency online There are still some people to
use it. It's value in relation to other things may change, but the system is not just going to go
away. It can't really. There's always somebody that's going to be using it somewhere. Yeah,
yeah, exactly. That's my point. Even if it's only two people left in the entire network,
it's still there.
There's probably,
and I don't think
it's ever going to be that little.
I think there's always
at this point
going to be inherent value
in these coins.
I don't think it'll be $30.
Now, back then,
everybody thought it was dead.
And the thing that's,
you know,
I think unique
about being able
to directly support the show
with a boost,
and I don't sell sponsorships
on this show,
is you're also investing
in something
that becomes a community resource.
And I say that humbly.
I'm doing this for you.
I put all my energy
into this
because I think my small dent in the universe can be helping people, especially the regular folks,
wrap their head around why they need to own a little bit of a hard asset.
That maybe could be my greatest contribution to this space, right?
And that's my goal, is to try to get you the best information possible so you can make the best decisions possible.
And as we get to the holiday season, we get into the winter season,
and I have new chores around a farm that I've never done before.
They start taking up more of my time.
My time and energy do get more scarce.
So as this week in Bitcoin rounds the year out, please do consider how it's been valuable to you and in which ways it's been valuable to you and what that might be worth.
And then send a boost with a note or become a member on Fountain or sign up for Jupiter.party for all the shows.
Well, a big report on Operation Chokepoint 2.0 is out.
We've gone from does this even exist to here's a detailed analysis of how it was executed.
This comes from the House Committee on Financial Services and the Oversight Chair released this final staff report
on how the Biden administration comprehensively debanked digital assets.
They write, quote,
This report documents how Obama-era practices were revived and expanded under President Biden.
Through pause letters, informal pressure campaigns, and regulation by enforcement,
the U.S. forced companies offshore.
Here's a bit of info on this and one of the Congress critters behind it.
Welcome back.
the House Financial Services Committee issuing a 53-page final staff report on how the Biden
administration debanked digital assets. It details how Biden-era regulators used vague rules,
excessive discretion, informal guidance, and aggressive enforcement all to pressure banks
into distancing themselves from digital asset clients. This resulted in at least 30 entities
or individuals losing access to financial services. Joining me now is Arkansas Congressman
French Hill. He is the chairman of the House Financial Services Committee. Mr. Chairman,
great to see you this morning. Thanks very much for being here. I want to kick it off with your
report. What can you tell us? Well, Maria, happy holidays. Great to be with you. Hope you had a
great Thanksgiving. This report identifies all the ways led by Gary Gensler, who was chairman of the
SEC, the bank supervisors led by Michael Barr, then vice chairman of the Fed and others, to
systematically debank legal businesses in the United States engaged in the digital asset
innovative space. And this has been was terrible for American competitiveness. And it led me during
the course of the Biden administration to offer my FID 21 bill, which is now the Clarity Act,
which gives the rules of the road, clear market structure road rules so that people know how to
innovate. They can count on the federal government for not debanking them and actually encouraging
the use of innovation blockchain technology inside financial services.
But why would the administration, the Biden administration, want to de-emphasize this?
Well, I think they took the same approach that the Obama administration is,
that when they, in their privileged point of view,
believes that somehow that this innovation is a bad thing,
they wanted to see it blocked from access to the financial system.
We call it Chokepoint 2.0.
Well, Choke Point 1.0, led by the FDIC, principally during the Obama administration, encouraged banks through leverage, intimidation, guidance, verbal communication, email listing, to ban them from banking businesses that the Obama administration didn't favor, like gun dealers, for example.
I see.
And porn, and porn, which was controversial at the time.
So there you go. I'll link to the full report in the show notes. And interestingly enough, you know, folks are still getting debanked. Jack Mahler's was just kicked out of Chase. So some of that continues on. Don't know if it's coordinated or not. Could be a lot of reasons. Jack also did call JP or Jamie Dimon Jeffrey Epstein's banker. There's that as well.
All right. So my Scott Bacon continues. I just love following this drama. I don't know if it's
going to go anywhere, but it will have massive ramifications if it does. You might remember I've
been tracking the probability of Treasury Secretary Scott Besson getting fired by President Trump.
I played a clip last week of Trump not really jokingly suggesting that he might fire Scott
if the rates don't come down anytime soon. Well, your buddy was asked about those rather awkward
comments. And he had this to say. Mr. Secretary, last week, the president, I'm not sure if he was
joking or how serious he was about it. He said he loves everything you're doing. But if you don't
get the Fed to lower interest rates soon, he might fire your butt. Well, let's see, Becky,
if you were in the if you were in the room, he was joking. And, you know, again, I think that
we've gotten to this point where monetary policy has gotten very complicated. And it's more than
just cutting rates. It is more than just cutting rates. And I think this is what he's selling the
president. Don't worry, Mr. President, even if that gosh darn awful Jerome Powell, that dummy,
even if he won't lower rates, I have a plan to get the rates down without the help of the Fed.
And he lays it out here. We are under your direction. We're reprivatizing the economy.
We're bringing down government spending. We're bringing down excess employment in the government
sector. On the other side, we're going to re-leverage the banking system. We're going to have all the
new manufacturing jobs. So everyone who's laid off from the government will have an opportunity to go
into the private sector. And that is going to lead to disinflation. We're going to, inflation
is under control. We're going to get the affordability crisis fixed. So let's stop here
for a second, because there was one thing that he slips in there that is going to be huge. And we
don't really talk about it much. We're going to re-leverage the banking system. In other words,
we're going to remove their collateral limits and let them buy government debt like crazy.
That, I just don't even understand. If you have any thoughts on the implications of that,
please boost in because to me, I just don't even know how to price that into my brain.
Bringing down excess employment in the government sector.
On the other side, we're going to re-leverage the banking system.
We're going to have all the new manufacturing jobs.
So everyone who's laid off from the government will have an opportunity to go into the private sector.
Everyone who's laid off from the government will have an opportunity to get a manufacturing job is one of the things he's modeling.
Okay, yeah, they're going to go from sitting at a desk all day at a government job or working from home to working in a factory?
I think they're more likely to just take benefits.
So everyone who's laid off from the government will have an opportunity to go into the private sector.
And that is going to lead to disinflation.
Inflation is under control.
We're going to get the affordability crisis fixed.
So lower energy, deregulation, more private sector jobs.
Lower regulation, lower energy prices, more private sector jobs would help with inflation.
However, uncapping the collateral requirements on the banks and letting them buy unlimited government debt, that seems like it would be very inflationary.
I just don't understand this plan.
And if this is his plan to save his job, I mean, some of it's going to work, but government workers aren't going to go get jobs at manufacturing plants and lower, you know, the unemployment and increase productivity.
It's just maybe some of them, a percentage of them will, maybe a small percentage of them will.
Let's be generous, actually. Let's say 20 percent, 30 percent. Let's be really generous.
It's not going to move the needle. It's not going to move the needle.
Not like removing collateral requirements on the banks will.
We're going to get the affordability crisis fixed.
So lower energy deregulation, more private sector jobs that will naturally get interest rates down, interest rates down.
Mortgage rates are down almost every week since January 20th.
The energy costs are down about 15 percent. Crude oil is down about 15 percent.
Now, the point Scott's trying to make is that there are other ways to influence the market rates.
The Fed sets a base rate, but mortgages aren't the base rate. They're higher than that.
And Scott's point is, is we have room to play to get that closer to the base rate.
OK, yes, technically true, but it's going to require them essentially.
the way they're going to do that is by jumping on every pump they possibly can to just try to
really stoke the economy. It's January 20th. The energy costs are down about 15 percent. Crude
oil is down about 15 percent. And as we keep that going, interest rates are going to keep declining.
It'll be good for mortgages. It'll be good for credit card debt. It'll be great for auto loans.
And please don't fire me is the implication there.
we'll see some of that's going to be pretty hard to pull off but i continue to track the
scott getting fired probability index all right now i want to go on to something that's been on
my mind for a few weeks and i haven't been quite sure how to talk to you about it until today
i think we are seeing levels of degenerate gambling like we've never seen before
over some word somebody might say in a press event
or silly events or just anything.
They'll gamble on anything.
I mean, I guess like a presidential election
is such a big thing that kind of almost doesn't seem too bad,
but it's getting just bonkers what people will vote on now.
And it really feels to me like another form of shitcoinery.
And it's the most perhaps flashy version.
And it may have the most money behind it ever.
And it may be the most built for retail
and really to screw retail that we've ever seen.
And today, it just got a lot easier.
Polymarket is officially coming to the U.S. market,
and this is their trailer for their new app that's coming to a smartphone near you.
Polymarket, raided by the FBI.
Many men wish death upon me.
Operating. We talk about Polymarket as if everyone can use it,
but the truth is most folks couldn't.
So it's cut with news clips of people declaring it's going to be dead.
And then they interstitial it with CG generated app visuals of like notifications about trades.
You have to get another country to sort of use the app.
Prevent U.S.-based users.
More push notifications.
Odds of app launching in U.S. go up.
And then you'll notice, too, they're using music of people said I was going to die.
People said they want to come after me.
What I'm destined to be
Successfully predicted the outcome of the presidential election
What does this actually look like in success?
Trying to take my life away
Mini-man, who's deaf upon me?
Polymarket is now invite only in the U.S.
Early access opens now
Look at my dog and I can't see
Looks like it's only for the iPhone at the moment
I this is this is to me an unsettling moment because I think this will siphon money away from where people should be putting it, which is Bitcoin.
And as the as the fiscal situation gets worse, as economically illiterate people look for solutions, instead of just adjusting their time preference and saving in a hard asset, they're going to flood into these betting markets and they're going to try to make a quick buck, pay off some debt, pay off the credit card, whatever it might be.
And it's going to take attention away from perhaps the largest innovation in finance.
It's the big markets that draw big bettors.
And this is one of Polymarket's biggest.
He's wagered more than $400 million so far.
Online, he goes by the name Domer.
I don't think of myself as a gambler.
I mean, I'm taking very, very well-researched views on things.
I feel like it's much more akin to investing.
Betting is Domer's full-time job.
He said he made nearly $3 million last year on Polymarket.
He used to be a professional poker player, but gave it up.
Prediction markets, he said.
are more exciting.
Every day, kind of going into battle.
You wake up, I don't know if you drink coffee,
and you're in battle.
You are wrong.
I look at my phone within five seconds of waking up.
What have I missed?
My phone is my coffee.
What has happened overnight?
Yeah.
Because the news doesn't sleep.
Did you bet on the papal conclave?
Yes, for sure.
How, I mean, a papal conclave
is a hermetically sealed environment.
Information does not get out.
Right.
Nobody was putting money down
that there'd be an American pope, but you were.
Yeah, and his odds were 250 to 1. So he was a super, super, super long shot.
He won $100,000 on the Pope and even more picking J.D. Vance to be Donald Trump's running mate.
He started betting on him five months before he was selected, when Polymarket was only giving Vance a 2% chance.
What did you see that made you think, oh, he might pick J.D. Vance?
So that goes back to 2016 when he picked Mike Pence.
And buried in one of the articles for why he picked Mike Pence is that Mike Pence had a one-syllable name.
And Trump has a one-syllable name.
And Trump is very into marketing.
And so I was looking at the names and I was like, who's one-syllable?
And not only is Vance one-syllable, he's only two letters off of Pence.
So you bet $4,000 and you ended up winning $250,000?
Yes.
Yeah.
It's a smart play.
It is a good bet.
Yeah.
Okay, I'm not saying don't have a little fun, but I'm saying you have to go in with the understanding of what this is.
These are casinos that are going to try to extract from you.
And this is just the beginning.
The real gambling will start when we get real-world assets on some commercial blockchain.
And then people are going to get so distracted by all of this.
It's kind of why it was nice recently when we heard Elon Musk kind of remind us of an idea that's been around since Henry Ford earlier this week.
There are still some fundamental currencies, if you will, that are physics-based.
So energy is the true currency.
This is why I said Bitcoin is based on energy.
You can't legislate energy.
You can't just pass a law and suddenly have a lot of energy.
It's very difficult to generate energy, especially to harness energy in a useful way to do useful work.
So I think that probably we won't have money and probably we'll just have energy, power generation as the de facto currency.
I think he misses the bit where Bitcoin can be the abstracted bit that represents that precious commodity that is energy.
But it reminded me of a question that the NVIDIA CEO got during a Q&A in D.C. about a year ago.
So I invest in crypto startups.
And our industry would kind of like to thank your industry for taking a little bit of the heat off of the negative PR of Bitcoin mining and and all that But that being said you know a lot of power producers energy producers
the excess energy, they allocate that to Bitcoin mining because there's a very clear market there,
kind of one-to-one financial market there. Do you see something like that possible in terms of like
a smart grid or like having those companies be able to dedicate some of that excess energy to
training models and like and providing that power to you just gave a a current example
of excess energy right being used to convert in to store that energy essentially what bitcoin is
doing is taking excess energy storing it into a new form it's called currency and you take that
currency and you take it wherever you like and so you took energy from one place and now you've
transported everywhere. Now he goes on to say, you could probably do that with an LLM too. You
use somewhere energy is cheap and train the LLM and then move what it learns somewhere else. Maybe.
But I think what struck me there is both Elon and Jensen seem to be thinking about Bitcoin in an
energy context. And it's not a bad way to think about it because it does matter, right? At the
All right, it's that time, the final clip of the week.
And I'm always on the watch for Bitcoin moments in mainstream media.
I just always love to see what they have to say.
And one of my favorites I've never shared with you, it's from an episode of Silicon Valley.
I'll put a link to this clip in the show notes so you can watch the video version if you like.
But what I like about this scene is what's going on behind it, because you just know, listening to this, it was written by someone who loves Bitcoin and went through phases of intense evangelism and is now at a point where they are kind of poking fun at themselves.
and they're doing it through the writing of this scene.
And I love it because Guilfoyle starts with this earnest desire
to walk his friend through a massive presentation of the history of money.
And boy, do I feel that one.
I have a PowerPoint that I've been wanting to show you for some time.
In 350 BCE, Aristotle defined sound money as being durable, transferable, divisible, scarce, recognizable, and fungible.
What?
Can we skip ahead 2400 years? I mean, I know what cryptocurrency is.
Richard, a lot of work went into this presentation.
Okay.
Fine.
But you're missing out on a lot of wisdom here.
Why don you tell me what you know about Bitcoin as a jumping off point Okay sure Well I pretty sure it was founded by a Japanese guy
Or guys, or girls, going by the name Satoshi Nakamoto in 2008.
True identity is still unknown.
Okay, look, every day I read an article about how we're in a Bitcoin bubble.
And who is writing those articles?
I don't want to say the establishment, but is it possible that Warren Buffett called Bitcoin a pyramid scheme because he has 92 billion conventional dollars to protect?
Let's say he's right. Let's say Bitcoin dies. So what? MySpace, Friendster, they both died.
But they paved the way for other social media tripe like Facebook and Twitter to completely overrun the planet.
Crypto is out there, and it's not going away.
It just feels sketchy.
In the same way that a new internet is sketchy, Richard?
What?
What is crypto, if not decentralized, anonymous, secure, and an existential threat to the powers that be?
I would think that you'd be all in on something like that.
let's check in on the state of the network i'm wrapping up at block height 926 306
the bitcoin price to usd is 93 000 and 40 dollars right now that puts our sats per dollar at 1075
We are down right now 26.3% from our all-time high, $126,180, a long 58 days ago on October 6th.
May it live in infamy, October 6th, 2025.
Our next difficulty change will be a downward adjustment right now of 1.2%, but that's not till December 10th.
So we may see that change.
We're still sitting well above a Zeta hash right now.
There are 24,675 nodes on the network.
That's jumped up a little bit.
Some of it is Notts.
In fact, Core and Notts are bouncing around on the charts as I'm live.
Core 30, though, sitting at the top with 13.4% share for one implementation.
Core 28 coming at two, but you could really give that to Notts, too, because they have several versions.
So it's kind of a toss-up right now.
But we are looking okay.
In the last 24 hours, we are up 1.1%.
over the last seven days, we're up 3.4%.
Of course, our 30-day, we're still down just over 13%.
But don't look at the price, because the metrics of the network,
they continue to be quite strong.
Well if you made it this far check out the links in the show notes this week in Bitcoin past episodes there as well as all the other great Jupiter Broadcasting show My goal here is to create you something that doesn get distracted by the emotions around what happening but focuses on the signal
Let me know how I did with the boost,
or if I missed something,
or if you'd like to see something covered
either in a future episode or in a special,
you can boost in with that too.
Now I'm going to leave you with a value for value track.
So if you boost in while this music plays,
95% of your sats go directly to the artist.
And this week it's Scoot.
by Catherine.
Let me get this right
You're on to me
You've made up a page
So casually
If we wanted this
To be your scene
Baby
You were like the
I gotta scoot now, baby
I move now, honey
I thought we agreed to
Just be friends
Your eyes tell me to undress
I gotta scoot now, baby
I move now, honey
I thought we needed to
It's our loose ends, but further after our grass
If we force the fire so casually
Will the flame be less damaging?
Logic seems to be a remedy
It's good crafting, so
I got a school now, baby
I'm now, honey
I thought we agreed to just be friends
I sell me two undress
I got a school now, baby, I don't know
Honey, I thought we needed to tie loose ends
But for the right diagram