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I think 2026 is going to be a great year for Bitcoin.

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If you want everybody on earth to use Bitcoin and every company on earth to use Bitcoin,

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you had to cure some fundamental problems.

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This entire community has very short memory,

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and whatever happened in the past five days dominates the conversation.

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We've got the world's greatest financial technology.

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Is there opportunity for people, for entrepreneurs or corporations

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to do good.

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Everything in history,

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it's a continual never-ending power struggle

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over money, over power.

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Everybody in the world can buy Bitcoin

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as part of their investment,

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but not everybody is going to have as much as me.

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Mr. Michael Saylor,

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thank you very much for having us here in Miami.

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Happy New Year.

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Same to you.

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2026.

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2026.

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Hopefully it's better than 2025.

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Bitcoin's 17 years old.

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17 years old. It's pretty wild. And last year was kind of disappointing for Bitcoin, I think.

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It's definitely not what I expected to happen in the year. And for treasury companies as well,

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especially the back half of the year was really rough. Did you expect that going into 2025?

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You know, I don't think it's a disappointing year. The only way in which it's disappointing

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is the price at the very end of the year. Do you know when the all-time high was?

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Would it have been about August?

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October 6th.

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October 6th, okay.

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Early October, first week of October.

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You know how many days it's been since the all-time high of Bitcoin?

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I mean, it must be like 100 days or something.

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Yeah, Grok thinks like 95 days.

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Yeah.

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Okay, so, by the way, you know, October.

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The last quarter of the year is October, November, December.

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Literally, the first week of the last quarter of the year,

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Bitcoin hit an all-time high.

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So in what way is it a disappointing year?

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This entire community has very short memory,

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and whatever happened in the past five days dominates the conversation.

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But if I look at 2025, I think, well, I think in 2024,

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we had like 30 to 60 companies that had Bitcoin on their balance sheet,

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and by the end of 2025, we had like 200.

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OK, so the fundamentals look pretty good to me.

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We hit an all-time high.

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We added 100 companies with Bitcoin on the balance sheet.

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I think my company raised something like $25 billion.

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And it all went into Bitcoin.

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So we bought $25 billion of Bitcoin in 2025.

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OK, this entire journey, Danny, started in August of 2020 with a $250 million purchase.

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OK, so 10x times 250 is $2.5 billion.

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We bought 100 times as much Bitcoin in 2025 as we did in August of 2020.

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And when we bought in August of 2020, that was the greatest amount of capital ever deployed in the Bitcoin network that anybody could remember in the history of the world.

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So 100x more than that strikes me as being a pretty good fundamental progression.

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You know, if I tick off what happened in 2025, we hit the all-time high.

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We had 100 Bitcoin companies come online.

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fair value accounting for Bitcoin, you know, was instituted at the beginning of the year.

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You know, it's crippling to the asset class. If you can only lose money, you can never make money.

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So if we're going to actually institutionalize and commercialize Bitcoin and globalize Bitcoin,

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if you want everybody on earth to use Bitcoin and every company on earth to use Bitcoin,

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you had to cure some fundamental problems. One, when we bought Bitcoin in 2020,

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our insurance company dropped us. We got de-insured. A lot of people got de-banked.

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You know, we got, in essence, when the accounting system said it's indefinite and tangible,

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we can't make money, you got de-profitized, you know? And when we rolled into the first

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week of 2020, what happened? We got our insurance back. For four years, I had to underwrite the

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insurance of the company. The company at one point had 20, 30, $40 billion of assets. We couldn't buy

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a $40 million insurance policy. Wow. Like strategy wouldn't exist if I had not personally insured

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the company with my own personal assets. It wouldn't have happened. So we got our insurance

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back in 2025. We got our profits back in 2025. We went to fair value accounting, and now it's

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possible for a company to make money. We had the corporate alternative minimum tax question

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hanging overhead. Is there going to be an unrealized capital gains tax on public companies

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holding Bitcoin? That was resolved with positive guidance from the administration in 2025.

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So we didn't have an unrealized capital gains tax hit us.

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Then we got legitimized as the primary and the greatest global digital commodity in the world by the administration in 2025.

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That happened at the White House summit and with a television interview that David Sachs gave.

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And then we hit an all-time high, you know.

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And if I look at all those things, and by the way, at the beginning of the year, I couldn't get a nickel loan on a billion dollars of Bitcoin collateral.

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A nickel.

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So we were debanked.

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We were, you know, there was no credit.

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And by the end of the year, the majority of the major banks in the United States were extending credit against IBIT.

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And like a quarter of them had announced plans to start extending credit against BTC.

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So I would say we start 2026.

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And by the way, JP Morgan and Morgan Stanley both talking about buying, selling, handling Bitcoin.

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So now you've got bankers moving with bank acceptance.

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You got positive guidance from the Treasury Department for crypto assets on a bank balance sheet.

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You got a pro-Bitcoin, pro-crypto head of the CFTC and Mike Selig.

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You got a pro-crypto, pro-Bitcoin head of the SEC and Paul Adkins.

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You got a pro-crypto, pro-Bitcoin president, cabinet member.

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You got universal utterance.

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You also had the commercialization of the Bitcoin derivatives market on the CME.

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We had all of the handcuffs taken off of IBIT stock options.

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You also got in-kind create and redemption where you could swap a million dollars of Bitcoin for a million of IBIT and vice versa.

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Swap a million of IBIT for a million of Bitcoin without a taxable event.

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so if i had a checklist of all the fundamentals necessary for the asset to be commercialized and

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globalized and institutionalized you got everything that you wanted in 2025 and you you even got an

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all-time high you just didn't get an all-time high on the last day of the year what if you could lower

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Yes.

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And like fundamentally,

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like everything you're saying is obviously incredibly bullish for Bitcoin.

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By the way, didn't you take over what Bitcoin did in 2025?

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It was actually the end of 24, but yeah, that might be the most bullish thing.

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It was a big year for you too.

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It was a big year.

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Okay.

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But like even fundamentally, those are very bullish things.

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I totally agree.

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But the price is lower today than it was this time last year.

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And like, I don't know if this is almost a self-fulfilling prophecy

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over sort of people thinking a four-year cycle is a real thing

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and therefore there's selling a Bitcoin.

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I mean, I think the four-year cycle is dead.

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What do you think is going to happen in 2026?

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Look, I think that trying to guess where the market goes over a hundred day time frame is a fool's errand.

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Like I literally just said 95 days ago, we were at an all time high and you're complaining about Bitcoin price action.

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Like, you know, we have the attention, you know, of sixth graders, not even sixth graders.

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It's not complaining.

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Name one thing in your life you accomplished in less than 100 days.

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Like you can't, you're supposed to have, you can't have a baby in less than 100 days.

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You can't get a college degree in less than 100 days.

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How many companies were started and declared successful in less than 100 days?

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You know, was what Bitcoin did made successful in 94 days, right?

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I mean, if you actually did a test on every single human endeavor for the last 100,000 years, like, and you said, well, I'm going to cancel them all if they weren't successful on the 93rd day.

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Like, first of all, nothing and none of us would be here.

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Right.

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So I think it's a mistake to fixate on short frequency events.

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The whole message of Bitcoin is you're supposed to have a low time preference.

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So I think that if you're an investor, if you're an investor, if you're buying a company,

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if you're investing in a company, expecting it to be successful in less than four years

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just marks you as naive.

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Like name a venture capitalist that would say that if the company that I invested in

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isn't a screaming success in less than four years, that I'm just going to sell my investment.

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Yeah, it doesn't exist.

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Yeah, it doesn't exist. So if you're an investor, you need a four-year time frame. But if you're a progressive, if you're an ideologue, okay, so you got up and you decided that you wanted to change the world by spreading an ideology, you probably need a 10-year time frame.

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You know, so if we go back and ask, well, how long did it take Gandhi to get where he wanted?

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I mean, look at the history of every ideological movement, you know, for the last 10,000 years.

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Normally, people that are deemed to be committed to something have a 10-year time frame.

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And if you did something for, by the way, the world's full of people that spent 10 years working on something and they still weren't successful.

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It took them another 10 or 20 years.

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But I think that if your goal is to see Bitcoin commercialized, you really shouldn't be analyzing or you shouldn't be assessing your success with a frequency of 10 weeks or even 10 months.

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So, I mean, what does it matter what happens in 2026 with the price?

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Do you know, take electricity.

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you know how long it went it took to go from four percent of factories running on electricity to

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75 percent no idea of factories 30 years okay so if you're an electricity maxi and you think

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by the way electricity is probably the single greatest development of our lifetime take away

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electricity all the cities die you know your florida becomes uninhabitable hospitals don't

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work. Refrigeration doesn't work. Half the planet dies. And so I give you the gift of clean,

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invisible, efficient energy that revolutionizes the world. And it still takes 30 years

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before 70% of the people agree with you. Okay, so Bitcoin is digital energy. It's digital capital.

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it's the basis of digital credit it's the basis of digital money it's developing very rapidly

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we're making great inroads you know you're like well the four-year cycle is dead

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well the irony is the people that are saying that haven't waited four years

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like we've only been 95 days since the peak of the cycle okay so how about i think that if you

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actually assess Bitcoin's performance on a rolling four-year moving average, you see a

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progression that looks pretty bullish. I think 2026 is going to be a great year for Bitcoin.

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But I think that you shouldn't be roped into trying to forecast what is the price in 90 days

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or the price in 108 aces.

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It's kind of like saying,

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well, 6% of the factories in Detroit have electricity.

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Well, what percentage of the factories

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will have electricity in 12 months?

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Well, you're wrong, and therefore electricity is awful.

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It's like, Jesus Christ, it took 30 years

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for people to embrace the most obvious invention

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in the world.

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And the same goes with radio,

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the same goes with television,

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The same goes with, you know, I mean, I think the greatest and most amazing thing of our lifetime, Danny, is probably the most profound technology invention of the 20th century was nuclear power.

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Like, here's a reactor.

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It generates a gigawatt of energy, and it does it without any obvious admissions.

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It's like unlimited clean energy.

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And that was a gift to humanity.

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And in 1973, we turned it all off.

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Like in 1973, the United States decided that they were afraid of nuclear power.

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Which is totally insane.

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It's one of the safest as well.

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We can't really trace a death in the United States to nuclear power,

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but we can trace hundreds of thousands of deaths a year to coal

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or to fossil fuels or to pollution.

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And the same people that turned off nuclear power,

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they embraced wood-burning stoves and coal and every type of fossil fuel,

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and they embraced wars in the Middle East and they embraced, you know, every alternative,

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everything imaginable rather than turn on unlimited free clean energy because a successful

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marketing campaign convinced them that it was scary and dangerous. We literally saw millions,

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if not tens of millions of people die in wars fighting over alternatives to nuclear energy.

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And we saw tens of millions of people die of pollution from alternatives to nuclear energy.

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and then the population of Germany turns off all their nuclear power plants.

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I think the Simpsons scared everyone.

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Yeah, and so I think you have to reason from first principles.

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And I guess my message is people all of a sudden discovered that nuclear power plants aren't a bad idea

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when they needed unlimited electricity for AI.

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Yeah.

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And all of a sudden it just flipped after 50 years of skepticism.

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we flipped to, oh, nuclear is cool again.

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Because when Apple and Google and Meta and Facebook and Amazon needed nuclear

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and OpenAI needed nuclear, like, okay, I guess we like it now.

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It literally was like overnight.

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If you were to trace that debate, we went from 50 years of skepticism

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and cynicism to massive enthusiasm because people realized

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that they needed electricity and they needed a lot of electricity. And so if humanity can fight

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through 50 years of nuclear skepticism to come out of that, then I think that 94 days of Bitcoin

239
00:19:01,680 --> 00:19:08,700
skepticism is not something that we ought to be that skeptical about. I mean, the bottom line is

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after 10 years of not doing nuclear, right, the nuclear power plant had a, you know, the nuclear

241
00:19:16,040 --> 00:19:25,640
winter, right? The nuclear bear market went from 1973 to 2023. It's 50 years. That was the bear

242
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market. And I can tell you from firsthand knowledge, I remember talking to a bunch of

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power companies in 2021, you know, just after the lockdowns, during the COVID crisis, you know,

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and energy usage sagged, they were literally all in the process of decommissioning all the

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nuclear power plants they operated, half the nuclear power plants of the US that people wanted

246
00:19:50,520 --> 00:19:55,940
to decommission them. They were going to decommission the Diablo Canyon power plant in

247
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California. They were all bragging about it, like, oh, we don't need these things. And that was

248
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literally four years ago. That's crazy. And then in like 2023, we had the chat GPT moment.

249
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And then at some point, political sentiment flipped and electricity became cool again

250
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and power usage became cool.

251
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Remember how the ESG movement?

252
00:20:16,820 --> 00:20:17,720
It disappeared very quickly.

253
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Disappeared.

254
00:20:18,440 --> 00:20:18,660
Yeah.

255
00:20:19,060 --> 00:20:22,560
It was like, remember when there was the big ESG attack on Bitcoin?

256
00:20:22,740 --> 00:20:34,550
Like Bitcoin can use electricity or else that the end And I think we all kind of got saved by chat GPT because once we realized that the hyperscalers

257
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were going to use 10 times as much energy

258
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as the Bitcoin industry,

259
00:20:38,330 --> 00:20:39,910
it became a rounding error.

260
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It was suddenly okay.

261
00:20:40,870 --> 00:20:43,670
And people decided maybe electricity was cool again

262
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and power was cool again.

263
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So I think you've got to think for yourself

264
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and you've got to think from first principles.

265
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and first principles suggest that

266
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unlimited clean energy

267
00:20:59,030 --> 00:21:02,010
from a nuclear reactor is a good idea

268
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when the alternative is burning wood

269
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or burning whatever.

270
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And I think first principles suggest

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that digital intelligence is good.

272
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All you got to do is go and use these things

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and they work, right?

274
00:21:16,950 --> 00:21:19,250
And you're like, okay, yeah, I want that.

275
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Like everybody wants that, right?

276
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If you use AI, everybody wants that.

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And then I think, you know, do I want to be able to move money at the speed of light and store it forever in cyberspace?

278
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Of course I do.

279
00:21:35,390 --> 00:21:36,190
Of course I do.

280
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So has my conviction been swayed by 94 days of not hitting an all-time high?

281
00:21:43,390 --> 00:21:49,310
No, I'm going to go on the record and say that I have an endurance of more than 94 days.

282
00:21:49,550 --> 00:21:49,730
Yeah.

283
00:21:50,050 --> 00:21:52,490
And it's kind of a joke, right?

284
00:21:52,490 --> 00:21:56,530
Because there's no educated person that didn't go to school for 16 years.

285
00:21:58,190 --> 00:21:59,310
94 days is not a lot.

286
00:21:59,350 --> 00:22:03,250
94 days is not a lot of time to carry the flag.

287
00:22:03,430 --> 00:22:10,210
And so if I have to do it for 1,094 days, I could do that too.

288
00:22:10,210 --> 00:22:15,110
That would still be less time than it took me to get through MIT and get an undergraduate degree.

289
00:22:15,490 --> 00:22:22,630
And by the way, after four years at MIT and undergraduate degree, you're still not deemed to be educated by polite society.

290
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Most sophisticated society, they would say, well, you need a master's degree to be a competent practitioner at the top of your field.

291
00:22:31,050 --> 00:22:37,950
So their position is 12 years of secondary school, four years of undergraduate, two years of graduate.

292
00:22:37,950 --> 00:22:41,370
and now you're ready to be a productive member of society.

293
00:22:42,730 --> 00:22:44,610
So that's 18 years, Danny.

294
00:22:45,790 --> 00:22:47,550
Bitcoin's 17 years old.

295
00:22:48,630 --> 00:22:52,590
And we just had our 17th birthday on January 3rd.

296
00:22:52,590 --> 00:22:59,210
And so Bitcoin, after 17 years, is a $2 trillion asset.

297
00:22:59,890 --> 00:23:03,310
And it's been embraced by hundreds of publicly traded companies

298
00:23:03,310 --> 00:23:05,030
and hundreds of millions of people.

299
00:23:05,030 --> 00:23:12,070
and it's been almost 100 days since our last all-time high, I think I'm feeling pretty bullish

300
00:23:12,070 --> 00:23:18,810
and I'm pretty happy about where we are. And if you gave me a choice, if you said, Mike,

301
00:23:19,410 --> 00:23:26,190
you can either have Bitcoin 150,000, but I'm going to roll back the banking acceptance,

302
00:23:26,190 --> 00:23:32,510
the options acceptance, the positive regulators at the CFTC, the SEC or Treasury, or I'm going to

303
00:23:32,510 --> 00:23:39,130
roll back. In fact, if you said, I'll give you $150,000, but you have to pick one of these things

304
00:23:39,130 --> 00:23:46,650
to roll back, you have to give up the CAMTI win, or you have to give up the FASB win, or you have

305
00:23:46,650 --> 00:23:51,610
to give up the support of the Treasury, or you have to give up the support of the SEC, or give up the

306
00:23:51,610 --> 00:23:57,350
support of the CFTC, or you have to give up the support of the banking community for IBIT,

307
00:23:57,350 --> 00:24:04,770
or you have to give up the fact that Citi and Schwab are moving to trade in custody of Bitcoin.

308
00:24:04,870 --> 00:24:08,090
If I had to give up just one of those things in return for an all-time high,

309
00:24:08,150 --> 00:24:10,190
the answer is I would give up the all-time high.

310
00:24:12,130 --> 00:24:16,250
And this is kind of like adult-like behavior.

311
00:24:16,250 --> 00:24:20,690
I would give up immediate gratification for the next 90 days

312
00:24:20,690 --> 00:24:24,570
in order to get the support of the multi-trillion dollar banking industry

313
00:24:24,570 --> 00:24:26,810
or the most powerful regulator in the world.

314
00:24:26,810 --> 00:24:32,010
Or maybe the ability to make money or to be deemed as profitable.

315
00:24:32,350 --> 00:24:35,530
So I don't think there's any question in my mind.

316
00:24:35,970 --> 00:24:38,110
The industry is evolving the right way.

317
00:24:38,230 --> 00:24:40,170
The network is evolving the right way.

318
00:24:41,290 --> 00:24:46,490
And the last 90 days are just an opportunity for, you know,

319
00:24:47,070 --> 00:24:49,670
someone that's got clear eyes to buy more Bitcoin.

320
00:24:50,270 --> 00:24:50,430
Yeah.

321
00:24:50,610 --> 00:24:53,430
And I'm also very bullish on Bitcoin going into 2026.

322
00:24:53,430 --> 00:24:57,810
The thing that I guess surprised me somewhat in 2025

323
00:24:57,810 --> 00:25:00,050
was just how many treasury companies turned up.

324
00:25:00,430 --> 00:25:01,950
Because when you first announced

325
00:25:01,950 --> 00:25:03,330
that strategy were buying Bitcoin,

326
00:25:03,710 --> 00:25:05,430
I thought we were going to have a lot of people

327
00:25:05,430 --> 00:25:07,070
copying you much, much earlier.

328
00:25:07,210 --> 00:25:08,590
But really, it wasn't until last year

329
00:25:08,590 --> 00:25:10,210
that we saw the floodgates open

330
00:25:10,210 --> 00:25:11,290
and a lot of companies come in.

331
00:25:13,050 --> 00:25:15,190
I've been very skeptical of a lot of the treasury companies.

332
00:25:15,730 --> 00:25:18,530
I think strategy and a few of the other larger ones,

333
00:25:18,870 --> 00:25:20,170
well, strategy's in a league of its own.

334
00:25:20,270 --> 00:25:22,030
You've got over 650,000 Bitcoin.

335
00:25:22,730 --> 00:25:25,890
I think the preferreds are really interesting, again, kind of set you aside.

336
00:25:26,510 --> 00:25:32,610
What do you think of all the companies that are still doing the very simple, like, sell equity, buy Bitcoin playbook?

337
00:25:33,930 --> 00:25:42,410
Well, I guess what I would say is everybody in the world can buy Bitcoin as part of their investment.

338
00:25:43,010 --> 00:25:45,730
But not everybody is going to have as much as me.

339
00:25:46,950 --> 00:25:49,290
But, you know, they could all buy it.

340
00:25:49,350 --> 00:25:50,630
I'm not skeptical of any of them.

341
00:25:50,710 --> 00:25:51,110
They buy it.

342
00:25:51,110 --> 00:25:53,090
Every family can buy Bitcoin.

343
00:25:53,350 --> 00:25:55,750
Some families will have more Bitcoin than other families.

344
00:25:56,250 --> 00:25:58,330
I'm not skeptical of a family's decision.

345
00:25:58,670 --> 00:26:00,450
Every company can buy Bitcoin.

346
00:26:00,610 --> 00:26:02,750
Some companies will have more Bitcoin than others.

347
00:26:03,130 --> 00:26:07,350
It's a good idea for all of them to buy it, right?

348
00:26:07,790 --> 00:26:10,470
Whether they're sort of cashflow positive businesses or not.

349
00:26:10,470 --> 00:26:22,670
if a company is not cash flow positive then it's just not a good company right but we see a lot of

350
00:26:22,670 --> 00:26:26,610
these companies crop up that really don't have a business all they're doing is trying to issue

351
00:26:26,610 --> 00:26:32,410
debt and buy bitcoin okay well aren't there plenty of people like individuals that don't have a

352
00:26:32,410 --> 00:26:39,470
business and they buy bitcoin too are you going to criticize them no i just don't know why like if

353
00:26:39,470 --> 00:26:41,870
you're not as rich as Bill Gates and you buy Bitcoin,

354
00:26:42,010 --> 00:26:43,030
should I criticize you?

355
00:26:43,150 --> 00:26:43,890
No, of course not.

356
00:26:43,930 --> 00:26:45,870
But the problem I have, I guess,

357
00:26:45,930 --> 00:26:48,830
is why would anyone buy shares in that company

358
00:26:48,830 --> 00:26:50,510
as opposed to one strategy?

359
00:26:50,910 --> 00:26:54,650
Well, every company has a different value proposition.

360
00:26:55,750 --> 00:26:56,670
By the way, Danny,

361
00:26:57,190 --> 00:27:00,410
the whole point,

362
00:27:01,370 --> 00:27:03,210
the message I've delivered every day

363
00:27:03,210 --> 00:27:05,430
for the past five years is buy Bitcoin

364
00:27:05,430 --> 00:27:07,510
because there's a lot of counterparty risk

365
00:27:07,510 --> 00:27:08,650
when you invest in a company.

366
00:27:09,470 --> 00:27:10,930
Like, why do you buy NVIDIA?

367
00:27:11,050 --> 00:27:11,990
Why do you buy Apple?

368
00:27:12,110 --> 00:27:14,250
Why do you buy Coca-Cola?

369
00:27:14,430 --> 00:27:15,470
Why do you buy Disney?

370
00:27:15,650 --> 00:27:16,990
Why do you buy an airline?

371
00:27:17,890 --> 00:27:20,370
There's the old story, how do you become a millionaire,

372
00:27:20,570 --> 00:27:22,230
start with a billion and invest in an airline?

373
00:27:23,150 --> 00:27:27,090
Okay, the world's full of companies that are bad investments.

374
00:27:28,470 --> 00:27:28,910
Right?

375
00:27:29,730 --> 00:27:30,550
The world's full of them.

376
00:27:30,830 --> 00:27:32,550
There's 400 million companies.

377
00:27:33,070 --> 00:27:34,370
So the question for you is,

378
00:27:34,370 --> 00:27:36,610
why haven't you invested in any of the 400 million?

379
00:27:37,170 --> 00:27:39,030
Because I buy Bitcoin.

380
00:27:39,470 --> 00:27:48,210
OK, so criticizing a company that buys Bitcoin misses the point.

381
00:27:48,930 --> 00:27:51,550
Well, why don't you criticize all the companies that don't buy Bitcoin?

382
00:27:52,110 --> 00:27:53,470
Are they even worse?

383
00:27:53,630 --> 00:27:58,390
The answer is there are some companies that have very good businesses and their cash flow positive.

384
00:27:58,390 --> 00:28:01,770
And there are some companies that have very awful businesses and their cash flow negative.

385
00:28:03,830 --> 00:28:07,550
OK, if you take a good business and you buy Bitcoin, it's a better business.

386
00:28:07,550 --> 00:28:18,090
If you take a bad business, a business that's losing money and you buy Bitcoin, you might very well offset the operating results, right?

387
00:28:18,830 --> 00:28:35,050
If you're losing $10 million a year in the operating business and you hold $100 million of Bitcoin on the balance sheet and you're making $30 million in capital gains on the balance sheet, then actually, now the question is, you're going to criticize that business for what?

388
00:28:35,050 --> 00:28:41,630
like I give you a business that's losing 10 million a year and it's got 100 million in cash

389
00:28:41,630 --> 00:28:48,150
and its choice is to buy Bitcoin and probably make 30 million in unrealized gains or Bitcoin gains

390
00:28:48,150 --> 00:28:56,950
or to give away the money, right? Buy back its stock. I mean, what would you do? Take the $100

391
00:28:56,950 --> 00:29:01,130
million and buy back your stock. If you had a money losing business, would you buy back your

392
00:29:01,130 --> 00:29:06,330
stock. I'd buy Bitcoin. But by the way, when you buy back the stock of a money losing business,

393
00:29:06,330 --> 00:29:13,210
aren't you just amplifying your losses three times as fast? Like if I had $100 million in cash

394
00:29:13,210 --> 00:29:17,650
and I bought the stock of a money losing business, I would just be going out of business faster,

395
00:29:17,730 --> 00:29:24,030
right? That's not smart. If I had 100 million and I bought treasury bills yielding 3%,

396
00:29:24,670 --> 00:29:30,790
then okay, well, so I'm making 3 million a year, but I'm losing 10 million a year. So I'm just

397
00:29:30,790 --> 00:29:36,630
going out of business like one third slower, right? If I took the $100 million and I bought

398
00:29:36,630 --> 00:29:42,050
Bitcoin with it, and Bitcoin goes up 30% a year for the next 20 years to create a simple model,

399
00:29:42,850 --> 00:29:47,270
I'm generating $30 million of Bitcoin gains. I've got $10 million of losses.

400
00:29:47,910 --> 00:29:52,510
Now I'm making $20 million a year. Didn't I just save the company?

401
00:29:53,970 --> 00:29:59,230
So why are you criticizing that company? I mean, the criticism is not that they bought Bitcoin.

402
00:29:59,230 --> 00:30:03,110
The criticism is that they're losing money.

403
00:30:03,230 --> 00:30:04,290
OK, well, I'll give you a choice.

404
00:30:04,370 --> 00:30:08,670
You can invest in a company that's losing $10 million a year with no Bitcoin, or you can

405
00:30:08,670 --> 00:30:12,710
invest in a company that's losing $10 million a year and making $30 million a year off the

406
00:30:12,710 --> 00:30:14,050
Bitcoin and making $20 million a year.

407
00:30:14,450 --> 00:30:15,870
Which of the two would you invest in?

408
00:30:16,430 --> 00:30:19,890
But I guess the question more is, though, do you think the market can sustain this many

409
00:30:19,890 --> 00:30:20,590
treasury companies?

410
00:30:20,650 --> 00:30:24,430
Because we see, especially the smaller ones, almost all of them are now trading at a significant

411
00:30:24,430 --> 00:30:25,310
discount to them now.

412
00:30:25,310 --> 00:30:26,830
I think you're just missing the point.

413
00:30:26,830 --> 00:30:31,230
like the Bitcoin community tends to eat its young.

414
00:30:32,170 --> 00:30:35,390
They would rather criticize a company that buys Bitcoin

415
00:30:35,390 --> 00:30:38,430
than criticize a company that doesn't buy Bitcoin.

416
00:30:39,030 --> 00:30:42,130
Why don't you focus upon criticizing the money losing companies

417
00:30:42,130 --> 00:30:42,970
that don't own Bitcoin?

418
00:30:43,170 --> 00:30:43,950
Why would you buy them?

419
00:30:44,870 --> 00:30:45,970
I agree with that.

420
00:30:46,110 --> 00:30:47,390
Why aren't you criticizing them?

421
00:30:47,650 --> 00:30:48,470
No, I agree with that.

422
00:30:48,590 --> 00:30:50,050
But it's not that I'm criticizing them.

423
00:30:50,110 --> 00:30:53,050
It's just that the shareholders in some of these other treasury companies

424
00:30:53,050 --> 00:30:54,070
are getting absolutely crushed.

425
00:30:54,070 --> 00:30:59,250
And is there any way that some of these companies ever get back to a 1XM nav?

426
00:30:59,250 --> 00:31:05,090
Yeah, I just don't accept the criticism.

427
00:31:05,090 --> 00:31:07,170
You made an investment in a company.

428
00:31:07,170 --> 00:31:08,610
Why did you invest in the company?

429
00:31:11,290 --> 00:31:18,430
My problem with the premise is you somehow think that it's OK for 400 million companies to not buy Bitcoin, and you like that.

430
00:31:18,670 --> 00:31:21,910
And you're going to criticize the 200 companies that bought Bitcoin.

431
00:31:21,910 --> 00:31:24,210
And that's the thing, that's your brilliance?

432
00:31:24,450 --> 00:31:30,030
How is it brilliant for you to ignore the fact that 400 million companies didn't buy Bitcoin

433
00:31:30,030 --> 00:31:36,390
and somehow that's okay and you're going to criticize the 200 companies that bought Bitcoin?

434
00:31:36,390 --> 00:31:37,930
That's not the criticism I'm making.

435
00:31:39,750 --> 00:31:44,950
You're just criticizing someone that bought an equity at the wrong price.

436
00:31:45,290 --> 00:31:49,730
Why don't you actually put the focus upon the people that make the investment decision?

437
00:31:50,230 --> 00:31:53,090
The companies don't determine the price their stock trades at.

438
00:31:54,330 --> 00:31:59,270
So my point here is, what is your brilliant insight, Danny,

439
00:31:59,350 --> 00:32:00,550
that people shouldn't buy Bitcoin?

440
00:32:00,790 --> 00:32:01,830
Is that what you're trying to say?

441
00:32:01,890 --> 00:32:03,350
No, I think people buying Bitcoin is cool.

442
00:32:03,450 --> 00:32:05,550
Okay, well, if it's okay for Bitcoin,

443
00:32:05,830 --> 00:32:07,670
well, what about an unemployed person?

444
00:32:07,670 --> 00:32:09,330
You want to criticize them for buying Bitcoin?

445
00:32:09,670 --> 00:32:10,250
Of course not.

446
00:32:10,530 --> 00:32:11,470
Well, what if you have debt?

447
00:32:11,550 --> 00:32:13,710
You want to criticize the person with debt for buying Bitcoin?

448
00:32:13,890 --> 00:32:14,430
Of course not.

449
00:32:14,550 --> 00:32:17,030
Well, then why are you criticizing a company for buying Bitcoin?

450
00:32:17,170 --> 00:32:18,090
I mean, I'm not criticizing it.

451
00:32:18,090 --> 00:32:20,310
If it's a good company that buys Bitcoin is better.

452
00:32:20,450 --> 00:32:23,350
And if it's a bad company that buys Bitcoin is better than it would have been.

453
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454
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Complex setups, clumsy interfaces, and a seed phrase that can be lost, stolen, or forgotten.

455
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Well, BitKey fixes that.

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458
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459
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It's simple, secure self-custody without the stress.

460
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And time named BitKey one of the best inventions of 2024.

461
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462
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463
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475
00:33:49,750 --> 00:33:52,170
No, I'm not criticizing any company here at all.

476
00:33:52,410 --> 00:33:56,750
I'm just saying I'm skeptical of whether the market can sustain like 200 plus treasury companies.

477
00:33:56,890 --> 00:33:58,590
Because what I don't understand is...

478
00:33:58,590 --> 00:34:03,790
Why would you... That's kind of like saying I'm skeptical that the market can sustain 200 people to buy Bitcoin.

479
00:34:03,910 --> 00:34:04,890
No, because it's not...

480
00:34:04,890 --> 00:34:05,650
What's the difference?

481
00:34:05,650 --> 00:34:12,850
It's the idea of just issuing debt to buy Bitcoin rather than being like a cash flow positive business.

482
00:34:12,850 --> 00:34:15,630
That's just an ignorant, offensive statement on your part.

483
00:34:16,510 --> 00:34:17,670
Please tell me why.

484
00:34:18,050 --> 00:34:22,130
Like, who are you to say they're just issuing debt to buy Bitcoin, right?

485
00:34:22,290 --> 00:34:23,250
You said that.

486
00:34:24,270 --> 00:34:27,750
Like, there's 400 million companies in the world.

487
00:34:28,730 --> 00:34:32,770
You're going to take the position that only 10 can buy Bitcoin?

488
00:34:32,770 --> 00:34:35,610
Why can't all 400 million companies buy Bitcoin?

489
00:34:35,850 --> 00:34:36,670
Of course they can.

490
00:34:36,890 --> 00:34:37,910
Well, don't they do things?

491
00:34:38,370 --> 00:34:38,610
Yeah.

492
00:34:39,110 --> 00:34:39,470
Okay.

493
00:34:40,430 --> 00:34:43,210
But it's the companies that don't do anything that I am.

494
00:34:43,390 --> 00:34:44,970
Again, I'm not criticizing anyone.

495
00:34:45,270 --> 00:34:49,070
Okay, but you're not criticizing a company that buys Bitcoin.

496
00:34:49,210 --> 00:34:50,690
You're criticizing a company that doesn't do anything.

497
00:34:52,030 --> 00:34:52,470
Yeah.

498
00:34:53,110 --> 00:34:54,890
Okay, well, there's 400 million companies.

499
00:34:55,350 --> 00:34:56,810
How many of the 400 million don't do anything?

500
00:34:57,730 --> 00:34:59,050
Why don't you just focus on that?

501
00:35:00,310 --> 00:35:03,870
We can agree that you shouldn't invest in companies that don't do anything

502
00:35:03,870 --> 00:35:05,270
to make a rational decision.

503
00:35:05,270 --> 00:35:06,490
But can we just leave it at that?

504
00:35:09,070 --> 00:35:16,070
I mean, I just think it's kind of a silly notion that you want to criticize a company that makes a rational decision.

505
00:35:18,130 --> 00:35:20,950
What do you want them to buy instead of Bitcoin?

506
00:35:21,890 --> 00:35:22,090
Right?

507
00:35:22,270 --> 00:35:24,050
What are you promoting instead of Bitcoin?

508
00:35:24,290 --> 00:35:24,410
Right?

509
00:35:25,650 --> 00:35:29,070
You have 200 companies that have decided to buy Bitcoin.

510
00:35:29,510 --> 00:35:32,910
That's like criticizing the 200 companies that adopted electricity.

511
00:35:32,910 --> 00:35:35,910
You're like, well, there's one of them that's better than the other.

512
00:35:35,910 --> 00:35:38,910
OK, that makes electricity bad?

513
00:35:38,910 --> 00:35:43,910
How is it irrational for a company to adopt a new technology

514
00:35:43,910 --> 00:35:46,910
which is better than the previous technology?

515
00:35:46,910 --> 00:35:47,910
No, that's not rational at all.

516
00:35:47,910 --> 00:35:52,910
What I worry about is the companies that may be seeing this as like a cash grab

517
00:35:52,910 --> 00:35:55,910
rather than actually trying to build anything interesting.

518
00:35:57,910 --> 00:36:00,910
OK, but we're not here to promote bad companies, are we?

519
00:36:00,910 --> 00:36:06,930
are we? That's kind of like, okay, well, I invented electricity and some dude that sells,

520
00:36:07,170 --> 00:36:13,350
I don't know, like cardboard cotton candy placards for a billion dollars announces he's

521
00:36:13,350 --> 00:36:19,570
going to buy electricity. I mean, my point is like, should you invest in the cardboard cotton

522
00:36:19,570 --> 00:36:25,010
candy company that sells cotton candy cardboard boxes for a billion dollars? Of course not.

523
00:36:25,010 --> 00:36:33,590
But my problem with your framing is you're saying, I don't know if the market has room for more than a couple of companies to buy Bitcoin.

524
00:36:34,410 --> 00:36:37,830
Look, the market has room for every company on earth to buy Bitcoin.

525
00:36:40,330 --> 00:36:40,770
Right?

526
00:36:40,910 --> 00:36:47,330
The market, and by the way, there's a simple way to think about this.

527
00:36:47,890 --> 00:36:54,390
If you've got a successful business or a healthy business and you're generating cash and you buy Bitcoin, won't you be better?

528
00:36:55,010 --> 00:37:01,590
OK. If you have a business which sometimes makes money, it's a struggling business.

529
00:37:02,170 --> 00:37:07,390
And some years it makes money, some years it doesn't make money, but you have a lot of cash.

530
00:37:08,010 --> 00:37:10,810
Wouldn't you be better to invest the cash in Bitcoin than give it away?

531
00:37:11,030 --> 00:37:11,670
Yes, absolutely.

532
00:37:11,810 --> 00:37:14,250
Wouldn't you be better to invest the cash in Bitcoin than buy treasuries?

533
00:37:14,830 --> 00:37:17,890
OK. So good companies benefit from buying Bitcoin.

534
00:37:18,510 --> 00:37:21,310
And then struggling companies benefit from buying Bitcoin.

535
00:37:21,870 --> 00:37:25,510
Now, if you have a company which makes no money, that's never going to make any money,

536
00:37:26,470 --> 00:37:32,090
that has $100 million in cash, your choice is give the money away.

537
00:37:32,330 --> 00:37:33,090
You've got no company.

538
00:37:33,870 --> 00:37:35,230
Invest the money in Bitcoin.

539
00:37:35,990 --> 00:37:40,810
You've got a company that generates no cash in its operating business, but makes $30 million

540
00:37:40,810 --> 00:37:43,330
a year, growing at 30% a year.

541
00:37:44,030 --> 00:37:50,110
I give you a digital company that is generating $30 million a year, growing 30% a year.

542
00:37:50,890 --> 00:37:52,790
Was that a good decision by the company?

543
00:37:53,330 --> 00:37:53,590
Yeah.

544
00:37:55,070 --> 00:37:55,550
OK.

545
00:37:55,730 --> 00:38:00,270
And so now your issue is, now I have a company which is losing $10 million a year forever.

546
00:38:00,550 --> 00:38:03,890
And I can make $30 million in Bitcoin, growing 30% a year.

547
00:38:04,050 --> 00:38:09,970
That means I start with $20 million, but the business is growing.

548
00:38:10,930 --> 00:38:16,190
Statistically, by the way, if you start with $100 million in Bitcoin and you bolt on $10 million of losses forever,

549
00:38:16,190 --> 00:38:22,130
then the business converges on the same result as a business that doesn't lose anything forever

550
00:38:22,130 --> 00:38:26,650
because eventually you're making a billion dollars a year and you're generating 10 million in losses

551
00:38:26,650 --> 00:38:29,550
and so you've still got a business making a billion a year is that a good idea

552
00:38:29,550 --> 00:38:37,370
okay so what's your problem like like your problem is i i think part of the issue is

553
00:38:37,370 --> 00:38:43,730
people in the bitcoin community can't imagine buying equity or they're like well that's not

554
00:38:43,730 --> 00:38:47,910
as good as buying Bitcoin. Well, that's not actually true. It is as good as buying Bitcoin.

555
00:38:47,910 --> 00:38:53,770
It's actually better because corporations have all sorts of tax advantages and all sorts of

556
00:38:53,770 --> 00:38:59,810
operational advantages. Take the business, which is losing 10 million a year. That business can

557
00:38:59,810 --> 00:39:06,210
generate a billion dollars of capital and turn around and go raise money at 5% risk-free 10 years

558
00:39:06,210 --> 00:39:09,490
out and buy Bitcoin with it, lever it up, and they'll probably outperform Bitcoin.

559
00:39:09,490 --> 00:39:15,450
what's wrong with that nothing's wrong with that i mean i i the only i don't know if it's

560
00:39:15,450 --> 00:39:18,070
better than buying bitcoin in the sense that you don't get to actually hold the bitcoin

561
00:39:18,070 --> 00:39:23,170
um it may outperform it but the point the point is you want to buy bitcoin buy bitcoin yeah but

562
00:39:23,170 --> 00:39:29,290
what but what's with all the hate it's like it's just so dysfunctional like all of the toxicity

563
00:39:29,290 --> 00:39:35,330
in the community that there's 400 million businesses like don't you don't you have a

564
00:39:35,330 --> 00:39:39,750
business, Danny? I do. Okay. With Bitcoin on the balance sheet. Okay. So you want me to sit and do

565
00:39:39,750 --> 00:39:43,550
podcasts talking about how you shouldn't buy Bitcoin and you'll never be as good as some

566
00:39:43,550 --> 00:39:48,950
other Bitcoin treasury company and like heaping scorn on you and then criticizing all your,

567
00:39:49,130 --> 00:39:54,150
if you go, if you find some venture capitalists that wants to give you $10 million and invest in

568
00:39:54,150 --> 00:39:59,490
what Bitcoin did, should I then send emails and nasty grams of them calling them stupid and

569
00:39:59,490 --> 00:40:03,930
criticizing them because they want to invest in you? And like, it's like the point is you have a

570
00:40:03,930 --> 00:40:09,830
business, you have to make a living. Your business is better with Bitcoin. By the way, what about the

571
00:40:09,830 --> 00:40:15,430
venture capitalists? I mean, like the subtext of all this is sort of like some toxicity and hatred

572
00:40:15,430 --> 00:40:22,430
and ignorance of people that invest in businesses for a living. Like the venture capitalist literally

573
00:40:22,430 --> 00:40:30,250
has a job where he has to invest capital in your business. He has to. He's not allowed to buy

574
00:40:30,250 --> 00:40:35,970
Bitcoin. Okay. So, well, you're not going to be the biggest Bitcoin treasury company, Danny,

575
00:40:36,070 --> 00:40:40,410
but the point is the VC needs to invest in someone. He wants to invest in a podcaster.

576
00:40:40,710 --> 00:40:45,410
You can choose to take the money and buy Bitcoin with it, or you can not buy Bitcoin with it.

577
00:40:45,810 --> 00:40:52,050
I'm not sitting hating on you and I'm not hating on him. And I'm not like, I'm not gleefully,

578
00:40:52,050 --> 00:41:04,200
you know disparaging people that buy equities The point is that guy in the business of buying private equity You in the business of creating private equity There are other people in the business

579
00:41:04,200 --> 00:41:11,160
of buying public equity. There are literally tens of trillions of dollars of capital locked up in

580
00:41:11,160 --> 00:41:17,380
the market and they can't buy Bitcoin. They can't invest in a private company. They have to invest

581
00:41:17,380 --> 00:41:25,300
in a public company. And the issue is, should a public company buy Bitcoin so they can invest in

582
00:41:25,300 --> 00:41:31,900
it? Of course they should. Some of them need to buy Japanese companies. Some of them need to buy

583
00:41:31,900 --> 00:41:38,080
Brazilian companies. I have capital. I have to invest in Brazilian companies. So you're a Brazilian

584
00:41:38,080 --> 00:41:41,700
company. You buy Bitcoin with it. You're never going to be the biggest Bitcoin holder in the

585
00:41:41,700 --> 00:41:47,780
United States, but what does that matter? So what happens if you're the 14th company in Brazil that

586
00:41:47,780 --> 00:41:55,840
buys Bitcoin? Well, I mean, the whole point here, the part that people are missing is, and this is

587
00:41:55,840 --> 00:42:01,780
my issue with the Bitcoin community in general, they would rather eat their young and they would

588
00:42:01,780 --> 00:42:08,400
and they would rather criticize other people that buy Bitcoin or support Bitcoin in a different way

589
00:42:08,400 --> 00:42:15,680
than them. Like you're not a self-custody maxi or you don't, you know, you don't do it the way I

590
00:42:15,680 --> 00:42:20,780
should do it. You should put it on like two titanium, 16 titanium plates and bury it under

591
00:42:20,780 --> 00:42:26,480
the dirt in eight continents in order to be a true Bitcoiner. They've got all these criticisms,

592
00:42:27,340 --> 00:42:35,100
but 99% of the world doesn't even know they exist and won't give them a nickel and hates them.

593
00:42:35,100 --> 00:42:42,000
Or constructively, 99% of the world is your enemy, and they don't criticize the 99% of the world as their enemy.

594
00:42:42,180 --> 00:42:47,620
They focus on the 1% of the world that agrees with them on 99% of substantive values.

595
00:42:48,260 --> 00:42:55,740
And so we spend so much time being critical of other Bitcoiners and other Bitcoin companies.

596
00:42:56,460 --> 00:43:03,480
And the truth of the matter is the guy that likes Bitcoin is 99% aligned with you and 1% different.

597
00:43:03,480 --> 00:43:10,660
So I live in the UK or you live in Germany and you speak German and you speak English with an accent.

598
00:43:10,780 --> 00:43:12,780
So I'm going to hate on you because you have an accent.

599
00:43:13,040 --> 00:43:19,840
When you say something in English agreeing with me with an accent, I'm going to spend all my time critiquing your accent.

600
00:43:20,620 --> 00:43:24,340
And I feel like a lot of the debate in the community is that.

601
00:43:25,380 --> 00:43:27,960
And it's just such a waste of time.

602
00:43:28,100 --> 00:43:29,680
It's so non-constructive.

603
00:43:29,680 --> 00:43:36,920
right that i mean the answer is there's 400 million companies some of them are good companies

604
00:43:36,920 --> 00:43:42,840
some of them are bad if you've got a monopoly good for you by the way you don't even need to

605
00:43:42,840 --> 00:43:47,820
buy bitcoin you have a monopoly right they're going to be the last ones to buy bitcoin if you've

606
00:43:47,820 --> 00:43:53,800
got a competitive business you're struggling you buy bitcoin then maybe it's the difference between

607
00:43:53,800 --> 00:44:00,860
success and failure of your business. If you have a business which is a weak business, okay, so

608
00:44:00,860 --> 00:44:06,320
whatever, you sell beverages in Australia and you're not Coca-Cola. Well, that doesn't mean

609
00:44:06,320 --> 00:44:10,740
you're an evil person. That doesn't mean you don't deserve to exist. Maybe Bitcoin is your lifeline.

610
00:44:12,300 --> 00:44:19,200
Like what if your family collectively spends more money than they make and you have no chance or no

611
00:44:19,200 --> 00:44:21,720
hope of making more than you need to spend.

612
00:44:22,020 --> 00:44:24,160
And I give you the chance to invest in Bitcoin.

613
00:44:24,160 --> 00:44:28,580
And that's the difference when your family going bankrupt and being destitute or not.

614
00:44:29,660 --> 00:44:34,040
It's like, I got some podcaster that's going to criticize my family because we're not Apple

615
00:44:34,040 --> 00:44:34,560
computer.

616
00:44:34,560 --> 00:44:40,580
It's like, it's just so offensive that you would criticize someone struggling to make

617
00:44:40,580 --> 00:44:46,320
a living by doing, but by doing some, but by an essence, investing in the same thing

618
00:44:46,320 --> 00:44:47,620
you invest in.

619
00:44:47,760 --> 00:44:49,060
Are you saying I'm criticizing these people?

620
00:44:49,200 --> 00:45:00,660
I'm just saying anyone that's criticizing a Bitcoin company is like piling on to a person that agrees with them on 99% of the fundamentals.

621
00:45:01,720 --> 00:45:04,880
And what you ought to do is applaud their decision.

622
00:45:06,180 --> 00:45:06,300
Right?

623
00:45:06,300 --> 00:45:18,020
They basically decided that freedom and sovereignty and economic integrity and Bitcoin was apex property.

624
00:45:18,020 --> 00:45:24,820
and that's a good thing, and they've joined the movement. So maybe we ought to thank them or at

625
00:45:24,820 --> 00:45:30,960
least support them. The fact that their stock got overvalued by a factor of three or, you know,

626
00:45:31,120 --> 00:45:35,900
so the stock trades up by a factor of 10 and you bought it and then it trades down. And now

627
00:45:35,900 --> 00:45:44,760
your answer is instead of criticizing yourself, you're criticizing them, right? You're a stock

628
00:45:44,760 --> 00:45:50,980
speculator. If you're an equity speculator and you buy stocks that are trading at 57 times revenue

629
00:45:50,980 --> 00:45:55,800
and then it trades down, the fault is not with the company. The fault is with you.

630
00:45:56,020 --> 00:45:58,020
I mean, I totally agree. That's personal responsibility.

631
00:45:58,020 --> 00:46:02,760
So instead of criticizing companies that do rational things, look in the mirror,

632
00:46:03,020 --> 00:46:09,560
hold yourself accountable. The problem is not companies buying Bitcoin. How much room is there?

633
00:46:09,840 --> 00:46:12,660
There's room for every company on earth to buy Bitcoin, Danny.

634
00:46:12,660 --> 00:46:17,880
So, okay, I think maybe I frame that badly because I'm not criticizing these companies.

635
00:46:18,080 --> 00:46:25,340
It's more I'm asking what the market will sustain as of right now for these pure play treasury companies, especially with the fact that like in 2025-

636
00:46:25,340 --> 00:46:27,020
Again, it's an offensive question.

637
00:46:27,060 --> 00:46:27,800
Can I, let me just-

638
00:46:27,800 --> 00:46:29,320
Like, here's the problem with it.

639
00:46:30,300 --> 00:46:35,520
You're the one that's characterizing them as pure play treasury companies.

640
00:46:36,700 --> 00:46:37,580
They're not.

641
00:46:37,580 --> 00:46:47,080
But that's the insult, Danny, is you insult me by characterizing what I am and what I will be for all of eternity.

642
00:46:47,180 --> 00:46:49,380
No, no, I'm not talking about strategy here at all.

643
00:46:49,500 --> 00:46:53,180
No, the point is I'm like just literally insulted that you take that position.

644
00:46:53,340 --> 00:46:55,260
It's an offensive position to take.

645
00:46:55,360 --> 00:46:57,780
Well, I apologize, because I'm really not trying to insult you.

646
00:46:57,780 --> 00:46:58,960
They're operating companies.

647
00:46:59,080 --> 00:47:00,580
Okay, but what, so...

648
00:47:00,580 --> 00:47:03,180
So the point is there's 400 million companies.

649
00:47:03,480 --> 00:47:04,760
They do a lot of different things.

650
00:47:04,760 --> 00:47:05,020
Mm-hmm.

651
00:47:06,020 --> 00:47:06,460
Right?

652
00:47:06,460 --> 00:47:15,960
And so you're taking the position that they do nothing but buy Bitcoin and sell equity to buy the Bitcoin by characterizing them as a pure play?

653
00:47:16,700 --> 00:47:16,940
Okay.

654
00:47:17,000 --> 00:47:18,320
Again, that wasn't my intention.

655
00:47:18,440 --> 00:47:19,180
I'm really not trying to offend you.

656
00:47:19,180 --> 00:47:20,160
Let me say it a different way.

657
00:47:20,460 --> 00:47:22,020
How many companies are there on earth, Danny?

658
00:47:22,580 --> 00:47:23,220
400 million.

659
00:47:23,520 --> 00:47:23,840
Okay.

660
00:47:23,940 --> 00:47:25,880
Well, so how much room is there for companies on earth?

661
00:47:26,420 --> 00:47:27,080
400 million.

662
00:47:27,400 --> 00:47:30,720
Well, then why are you concerned about the fact there's 200?

663
00:47:30,720 --> 00:47:44,700
No, no. The question I'm trying to get to, though, is like with In25, like you launching the preferreds, which I think are a really interesting product. Does that change the playbook for all these other companies? And how do they now compete against you now you have the preferreds as well?

664
00:47:45,580 --> 00:47:47,680
Again, I take issue with your question.

665
00:47:47,920 --> 00:47:51,580
It's an ignorant, insulting, myopic question.

666
00:47:51,780 --> 00:47:54,200
Why do you frame things that way?

667
00:47:54,580 --> 00:47:56,060
We're not competing with each other.

668
00:47:56,380 --> 00:48:01,260
That's like saying, well, you know, like I heard my neighbor bought Bitcoin and I bought Bitcoin.

669
00:48:01,360 --> 00:48:03,680
There's not enough room for both of us to buy Bitcoin.

670
00:48:03,800 --> 00:48:04,960
We're competing with each other.

671
00:48:04,960 --> 00:48:09,100
Now, what's my neighbor's got to buy another crypto asset?

672
00:48:10,140 --> 00:48:12,380
Like we're not competing with each other, Danny.

673
00:48:12,380 --> 00:48:19,600
like that that's that's the ignorant part of the question right that's what i take issue with

674
00:48:19,600 --> 00:48:27,640
what you have if you're a hotel company in japan you're competing with other hotel companies in

675
00:48:27,640 --> 00:48:33,880
japan and the decision to buy bitcoin is just a decision to improve the quality of your company

676
00:48:33,880 --> 00:48:40,880
it's like saying how many companies can have electricity i heard 200 companies have electricity

677
00:48:40,880 --> 00:48:42,760
but there's one company that uses a lot of it.

678
00:48:43,160 --> 00:48:45,020
So do the other companies have to change their strategy?

679
00:48:46,760 --> 00:48:49,180
Dude, you think they had the same strategy?

680
00:48:51,720 --> 00:48:59,260
It's a silly question, and it's a myopic, ignorant, toxic framing of a question.

681
00:48:59,260 --> 00:49:05,960
And the result is you come to some ignorant conclusion.

682
00:49:07,300 --> 00:49:07,980
Okay.

683
00:49:08,120 --> 00:49:10,800
There's room for 400 million companies to buy Bitcoin.

684
00:49:10,880 --> 00:49:16,100
Danny. Do insurance companies compete with my company? I don't sell insurance.

685
00:49:18,000 --> 00:49:22,860
No. Do banks compete with my company? I don't sell bank. I'm not a bank. I don't buy consumer

686
00:49:22,860 --> 00:49:29,480
credit. Do I issue credit cards? No. Do exchanges compete with my company? No. We're not an exchange.

687
00:49:30,240 --> 00:49:35,900
Do companies that create AI compete with my company? No. None of these people compete with

688
00:49:35,900 --> 00:49:37,160
Like, there's a million.

689
00:49:37,460 --> 00:49:40,280
We literally just said there's 400 million companies.

690
00:49:41,120 --> 00:49:47,560
Why do you think that there's only one possible business strategy for a company that holds Bitcoin as a balance sheet?

691
00:49:47,780 --> 00:49:50,900
That's like saying there's only one thing you can do with electricity.

692
00:49:51,320 --> 00:49:52,480
Okay, what's the one thing?

693
00:49:55,040 --> 00:49:57,020
There's more than one thing you can do.

694
00:49:57,020 --> 00:49:57,340
Of course.

695
00:49:57,560 --> 00:49:59,100
It's like, oh, well, we speak English.

696
00:49:59,260 --> 00:50:01,260
Well, there's only one thing you could do if you speak English.

697
00:50:01,400 --> 00:50:02,200
We use dollars.

698
00:50:02,200 --> 00:50:07,580
Bitcoin is just a digital capital asset

699
00:50:07,580 --> 00:50:11,920
You can literally do millions of things with digital capital

700
00:50:11,920 --> 00:50:18,820
Which is why I take offense every time you try to characterize us as competing with each other

701
00:50:18,820 --> 00:50:21,640
You're creating this dog-eat-dog world where everybody competes

702
00:50:21,640 --> 00:50:23,260
We're not competing with each other

703
00:50:23,260 --> 00:50:29,460
Companies that adopted electricity decided they didn't want to rely on donkey carts

704
00:50:29,460 --> 00:50:36,580
and you're sitting here criticizing companies that adopt electricity instead of use donkeys

705
00:50:36,580 --> 00:50:42,880
you know and it's like i just think it's offensive and it's myopic and we ought to be constructive

706
00:50:42,880 --> 00:50:48,220
why don't you applaud them for not using donkey carts and using electricity and then why don't

707
00:50:48,220 --> 00:50:52,380
you think well maybe there's more than one thing i can do with electricity maybe there'll be a world

708
00:50:52,380 --> 00:50:56,460
of hollywood movies and maybe we'll create elevators and maybe we'll create electric cars

709
00:50:56,460 --> 00:50:58,040
and maybe we'll create hair dryers

710
00:50:58,040 --> 00:51:00,120
and maybe we'll create air conditioners with electricity.

711
00:51:00,800 --> 00:51:02,800
You can't imagine anything you could do

712
00:51:02,800 --> 00:51:03,920
with digital capital?

713
00:51:04,860 --> 00:51:05,620
Of course.

714
00:51:05,780 --> 00:51:08,800
Insurance, credit, banking, exchanges,

715
00:51:09,340 --> 00:51:12,380
derivatives, money, money funds.

716
00:51:13,220 --> 00:51:15,720
How about everything on earth that's ever been done

717
00:51:15,720 --> 00:51:16,960
would be done better with credit?

718
00:51:17,780 --> 00:51:20,740
I mean, I'm really not trying to criticize these companies.

719
00:51:20,840 --> 00:51:23,060
I'm just trying to get your perspective on it.

720
00:51:23,180 --> 00:51:24,540
I'm sorry if that was an offensive question.

721
00:51:24,540 --> 00:51:26,200
You're getting my perspective on it,

722
00:51:26,200 --> 00:51:30,120
which is you're wasting your time criticizing companies

723
00:51:30,120 --> 00:51:31,580
that decided they like Bitcoin.

724
00:51:32,920 --> 00:51:33,520
Okay.

725
00:51:33,800 --> 00:51:36,400
If you want to criticize companies, Danny,

726
00:51:36,700 --> 00:51:40,320
why don't you criticize the 99.9% of the companies

727
00:51:40,320 --> 00:51:42,820
that don't like Bitcoin?

728
00:51:44,320 --> 00:51:44,560
Okay.

729
00:51:45,380 --> 00:51:47,460
I mean, isn't that what you should be doing?

730
00:51:48,460 --> 00:51:49,640
That's my point.

731
00:51:49,640 --> 00:51:53,380
It's like this toxicity of eating its own young.

732
00:51:53,380 --> 00:52:02,340
Like, why don't you actually support the people that agree with you on 99% of your ideology instead of criticizing them?

733
00:52:03,900 --> 00:52:04,540
Fair.

734
00:52:05,020 --> 00:52:05,260
Right?

735
00:52:05,320 --> 00:52:11,500
They're actually trying to do the right thing for their shareholders, their families, right?

736
00:52:11,620 --> 00:52:13,540
Their countries, right?

737
00:52:13,540 --> 00:52:16,380
They're doing good things, right?

738
00:52:17,080 --> 00:52:20,080
There's people in Brazil that need to buy equity.

739
00:52:20,080 --> 00:52:22,820
They need someone like Orange BTC.

740
00:52:23,380 --> 00:52:24,460
There's people in Japan.

741
00:52:25,100 --> 00:52:26,500
They need MetaPlanet.

742
00:52:26,720 --> 00:52:27,680
There's people in the UK.

743
00:52:27,940 --> 00:52:29,400
They need SmarterWeb.

744
00:52:29,500 --> 00:52:30,500
There's people in France.

745
00:52:30,680 --> 00:52:32,440
They need Capital B.

746
00:52:34,400 --> 00:52:38,040
Those companies are planting the flag for Bitcoin,

747
00:52:38,040 --> 00:52:43,440
and they're carrying digital capital into the equity capital markets

748
00:52:43,440 --> 00:52:46,340
everywhere in the world, and they're all doing it to different degrees.

749
00:52:47,420 --> 00:52:48,540
And they're struggling.

750
00:52:48,860 --> 00:52:50,440
It's a very competitive market.

751
00:52:50,440 --> 00:52:57,660
like out of the 400 million companies like how many of them have an easy time of it danny oh

752
00:52:57,660 --> 00:53:07,960
very 10 yeah okay so so there's like 10 mega corps have an easy time everybody else is struggling

753
00:53:07,960 --> 00:53:11,380
there's 8 billion people struggling there's 400 million companies that are struggling

754
00:53:11,380 --> 00:53:20,900
like what what's my advice for them buy bitcoin bitcoin's the strategy my issue with your question

755
00:53:20,900 --> 00:53:26,940
is your advice is don't bother because you're not going to be as big a strategy and let's talk about

756
00:53:26,940 --> 00:53:33,440
all their problems and my point is it's so non-constructive it's all souls soul sucking

757
00:53:33,440 --> 00:53:42,420
right right for for us to spend time on negativity they have they have to get up and go to work just

758
00:53:42,420 --> 00:53:48,820
like you do and so my suggestion for your company is focus on bitcoin and if you have capital buy

759
00:53:48,820 --> 00:53:55,820
bitcoin with it and don't obsess over the fact that maybe you don't have as much as another

760
00:53:55,820 --> 00:54:03,320
company or you can't do what another company could do ask yourself what you can do like i got a hundred

761
00:54:03,320 --> 00:54:10,380
ideas for you. They're all good constructive ideas. People either look at the world with a

762
00:54:10,380 --> 00:54:15,800
positive lens. I'm going to embrace new technology and become the best version of myself I can be.

763
00:54:15,980 --> 00:54:20,980
Or they embrace negative ideas. Oh yeah, someone else got there before me and I guess I can't.

764
00:54:22,040 --> 00:54:26,940
So I don't think we should be spending time on negativity. Okay. Let's move on from that then

765
00:54:26,940 --> 00:54:32,680
because I truly wasn't trying to be offensive with that. With all of the companies that are

766
00:54:32,680 --> 00:54:40,080
trading below 1x MNAV. Obviously, strategy went through a period of that in 2022. Do you think

767
00:54:40,080 --> 00:54:45,200
they will easily be able to grow into positive MNAVs again? Or is there like a constant gravity

768
00:54:45,200 --> 00:54:51,900
to one that you have to kind of fight? No, I think that's just a myopic narrative,

769
00:54:52,920 --> 00:54:59,140
right? Companies exist to create value. And so the company is going to be valued based upon

770
00:54:59,140 --> 00:55:01,340
in their operation, what do they do?

771
00:55:02,480 --> 00:55:02,700
Right?

772
00:55:03,300 --> 00:55:08,280
If I have a company in Japan and I can sell credit instruments that yield 6%

773
00:55:08,280 --> 00:55:12,960
and the rest of the credit markets pay 2%, then what's the company worth?

774
00:55:15,400 --> 00:55:18,020
Isn't that the most valuable company in Japan?

775
00:55:18,320 --> 00:55:18,660
Absolutely.

776
00:55:19,400 --> 00:55:20,340
Does anything else matter?

777
00:55:21,260 --> 00:55:24,480
Isn't the question whether or not you can sell credit to pay 6%?

778
00:55:24,480 --> 00:55:24,940
Mm-hmm.

779
00:55:26,620 --> 00:55:28,400
Take the same company in the UK.

780
00:55:28,400 --> 00:55:30,920
if the credit markets are paying you four,

781
00:55:32,680 --> 00:55:35,180
and you're the company in the UK that offers eight,

782
00:55:35,360 --> 00:55:36,320
what's the company worth?

783
00:55:37,700 --> 00:55:38,780
It's worth a lot.

784
00:55:39,260 --> 00:55:40,760
Now, I'm just giving you one strategy,

785
00:55:41,000 --> 00:55:43,440
but okay, well, what about life insurance?

786
00:55:43,600 --> 00:55:46,520
What if I create a Bitcoin-backed life insurance company

787
00:55:46,520 --> 00:55:49,260
in the UK, and I offer life insurance policies

788
00:55:49,260 --> 00:55:51,380
to pay you double every other life insurance company

789
00:55:51,380 --> 00:55:51,780
in the UK?

790
00:55:52,260 --> 00:55:52,960
What's that worth?

791
00:55:53,680 --> 00:55:55,720
How big is the insurance business in the UK?

792
00:55:58,400 --> 00:56:06,160
reasonably big right a big bank that i that i do business with put out a a preferred stock report

793
00:56:06,160 --> 00:56:12,080
and and they published all the preferreds and the and the average preferred stock in the united states

794
00:56:12,080 --> 00:56:16,480
and in our capital market pays six percent and it's illiquid

795
00:56:18,960 --> 00:56:24,000
you know if you're strive and you have a preferred stock that pays 12 and it's liquid what's that

796
00:56:24,000 --> 00:56:32,820
worth a lot so why are we fixated upon one mna like the issue is not one mna the issue is is

797
00:56:32,820 --> 00:56:36,880
what's the company going to do are you going to create the world's greatest insurance

798
00:56:36,880 --> 00:56:43,040
right like the average insurance company is investing your in your insurance proceeds at

799
00:56:43,040 --> 00:56:46,320
five percent or six percent well what if we invested them at thirty percent

800
00:56:46,320 --> 00:56:53,340
that i mean what if i offered you auto insurance and the auto insurance only cost you one half

801
00:56:53,340 --> 00:56:56,720
what if my premiums were half of the normal auto insurance?

802
00:56:56,920 --> 00:56:58,660
What would the auto insurance company be worth?

803
00:56:59,400 --> 00:57:00,340
A lot, right?

804
00:57:01,460 --> 00:57:05,780
So my point really is the companies will be worth whatever they're worth,

805
00:57:05,840 --> 00:57:06,540
whatever they do.

806
00:57:07,200 --> 00:57:10,400
What are they going to do is the question, right?

807
00:57:10,500 --> 00:57:13,680
We have chosen to create digital credit.

808
00:57:15,500 --> 00:57:18,020
You know, how much room is there to create digital credit?

809
00:57:18,020 --> 00:57:22,460
Well, Danny, you know how many companies issue preferred credit?

810
00:57:23,060 --> 00:57:23,640
No idea.

811
00:57:23,960 --> 00:57:24,340
Thousands.

812
00:57:26,000 --> 00:57:26,400
Thousands.

813
00:57:27,780 --> 00:57:29,900
You know how many companies issue corporate credit?

814
00:57:30,620 --> 00:57:30,960
More.

815
00:57:31,520 --> 00:57:32,380
Hundreds of thousands?

816
00:57:32,520 --> 00:57:32,760
Mm-hmm.

817
00:57:33,020 --> 00:57:33,500
Millions?

818
00:57:35,540 --> 00:57:37,380
You think we're going to saturate the market?

819
00:57:37,620 --> 00:57:38,180
Absolutely not.

820
00:57:38,180 --> 00:57:40,060
I think the prefers are really interesting.

821
00:57:40,820 --> 00:57:45,080
But digital credit is just like it's one little thing.

822
00:57:45,860 --> 00:57:48,200
How about digital insurance?

823
00:57:49,380 --> 00:57:49,540
Right?

824
00:57:49,540 --> 00:57:58,900
There's a lot of other things to be done. Digital banking, digital derivatives, digital exchanges.

825
00:57:59,680 --> 00:58:05,960
If you create a derivatives business backed by Bitcoin, you can, in theory, be much better than conventional derivatives.

826
00:58:06,180 --> 00:58:10,760
If you created an exchange backed by Bitcoin, you could be better than normal exchanges.

827
00:58:11,420 --> 00:58:13,000
You can create an insurance company.

828
00:58:13,000 --> 00:58:19,620
How many insurance companies on earth use Bitcoin as the back-end collateral or the capital?

829
00:58:19,840 --> 00:58:20,180
Zero?

830
00:58:20,340 --> 00:58:20,600
None.

831
00:58:21,180 --> 00:58:22,200
How big is the industry?

832
00:58:22,800 --> 00:58:23,320
Ginormous.

833
00:58:23,860 --> 00:58:24,500
Ginormous.

834
00:58:25,740 --> 00:58:25,980
Okay.

835
00:58:26,380 --> 00:58:33,440
So let's not wax philosophical about the fact there's too many companies that are experimenting with Bitcoin.

836
00:58:33,900 --> 00:58:38,100
And there's an important legal point to make, right?

837
00:58:39,040 --> 00:58:40,960
You're an operating company.

838
00:58:41,700 --> 00:58:46,740
Your equity is valued not just on what you're currently doing with your capital.

839
00:58:47,440 --> 00:58:51,700
Your equity is valued based upon what you might potentially do.

840
00:58:52,380 --> 00:58:56,940
The fact that I haven't done it doesn't mean that I couldn't do it.

841
00:58:58,020 --> 00:59:02,840
And this goes to this debate about these companies, these digital asset companies.

842
00:59:02,960 --> 00:59:04,460
Are they investment companies?

843
00:59:04,560 --> 00:59:05,680
Are they operating companies?

844
00:59:05,680 --> 00:59:13,780
An investment company, by law, Danny, cannot do anything with their capital other than hold it in trust.

845
00:59:14,480 --> 00:59:24,680
So if you have $10 billion of capital and you're an investment company, your IBID or your FBTC, you literally can do nothing but hold it and wait.

846
00:59:25,660 --> 00:59:29,920
An operating company can underwrite auto insurance with it.

847
00:59:30,240 --> 00:59:32,140
They can sell reinsurance.

848
00:59:32,260 --> 00:59:34,400
They can sell flood or fire insurance with it.

849
00:59:34,400 --> 00:59:39,260
They can loan it out and rehypothecate it and generate yield on it.

850
00:59:39,540 --> 00:59:41,960
They can write digital credit against it.

851
00:59:42,020 --> 00:59:43,960
They can issue corporate bonds against it.

852
00:59:44,000 --> 00:59:44,980
They can issue junk bonds.

853
00:59:45,060 --> 00:59:46,200
They should issue convertible bonds.

854
00:59:46,540 --> 00:59:49,700
They could actually do real estate development with it.

855
00:59:50,380 --> 00:59:52,940
You could do anything conceivable.

856
00:59:53,080 --> 00:59:54,460
You could create a derivatives market.

857
00:59:55,020 --> 01:00:02,260
You can create all sorts of derivative instruments, exchanges, options, contracts, everything imaginable with it.

858
01:00:02,260 --> 01:00:07,080
OK, the things that they could do would be illegal.

859
01:00:07,460 --> 01:00:13,380
You would literally end up in jail or you would end up bankrupt if you tried to do it as a trust company, as an investment company.

860
01:00:13,600 --> 01:00:15,740
But as an operating company, you can do it.

861
01:00:16,540 --> 01:00:30,360
So, you know, some armchair critic on Twitter wants to stare at a company that's got 500 million or a billion of Bitcoin saying, well, they're trading at a discount to NAV or they traded at whatever NAV and they think they know the future.

862
01:00:31,160 --> 01:00:32,480
You don't know the future.

863
01:00:33,600 --> 01:00:46,180
The point is, if I had a billion dollars of Bitcoin in an operating company and the stock was valued at a billion, is that the same as a billion dollars of Bitcoin in an ETF?

864
01:00:47,100 --> 01:00:47,440
No.

865
01:00:47,760 --> 01:00:48,140
Why?

866
01:00:49,140 --> 01:00:56,800
Because the operating company has a billion dollars of capital and unlimited, infinite optionality forever.

867
01:00:56,800 --> 01:01:02,800
And the trust company has zero optionality.

868
01:01:04,640 --> 01:01:10,180
And so here's the big idea for an equity investor.

869
01:01:10,920 --> 01:01:37,530
The management team of the operating company can take decisions that will either increase the billion dollars by a factor of 100 or take decisions to lose it all to take it to zero They both legal Danny They both ethical right One could say that if the operating management team does stupid things

870
01:01:37,670 --> 01:01:41,650
they rehypothecate the Bitcoin and it's lost and it goes to zero,

871
01:01:41,830 --> 01:01:43,630
they've destroyed shareholder value.

872
01:01:44,290 --> 01:01:47,350
But the management team might also do intelligent things

873
01:01:47,350 --> 01:01:48,730
that create shareholder value.

874
01:01:49,470 --> 01:02:02,070
The stock is going to trade based upon the sentiment in the market about whether or not the investors or the marketplace thinks that the management team is going to create shareholder value and dilute shareholder value.

875
01:02:02,830 --> 01:02:07,550
And over the course of a decade, the market's a weighing machine.

876
01:02:07,690 --> 01:02:10,510
And if they did the right thing, the stock is going to be more valuable.

877
01:02:11,430 --> 01:02:17,390
Do you know how long the conventional wisdom was that Amazon was a stupid company doing stupid things that would never work?

878
01:02:17,390 --> 01:02:18,370
I don't know, a decade?

879
01:02:18,370 --> 01:02:25,850
A decade. A decade after it was obvious that Amazon was a good idea, the conventional wisdom

880
01:02:25,850 --> 01:02:30,150
was they were stupid company doing stupid things, destroying shareholder value. You can literally

881
01:02:30,150 --> 01:02:36,670
watch the Amazon stock and you could see the consensus, go pull the logs. So the market may

882
01:02:36,670 --> 01:02:41,710
take a skeptical view. The market's view of Apple was skeptical for five years, 10 years, like it

883
01:02:41,710 --> 01:02:46,670
traded a P to E of eight or 10 or whatever. It's like a device company. And then it flipped.

884
01:02:46,670 --> 01:02:56,810
But so the market might have a sentiment that these companies are poorly run investment

885
01:02:56,810 --> 01:02:57,250
trusts.

886
01:02:57,250 --> 01:03:01,870
But at the end of the day, the destiny, the fate of the company is going to be determined

887
01:03:01,870 --> 01:03:03,510
by the management team's actions.

888
01:03:05,110 --> 01:03:11,270
And they can choose to enter certain industries, and they can choose to enter certain markets.

889
01:03:12,290 --> 01:03:14,850
My company is a US company.

890
01:03:14,850 --> 01:03:17,830
We haven't chosen to enter the banking industry.

891
01:03:18,430 --> 01:03:20,330
We haven't applied for a banking license.

892
01:03:20,530 --> 01:03:23,050
We haven't entered the insurance industry.

893
01:03:23,190 --> 01:03:29,510
We haven't entered into the market to issue securities in the UK or Japan or Brazil.

894
01:03:30,270 --> 01:03:31,970
We choose not to.

895
01:03:33,290 --> 01:03:34,790
We don't need to.

896
01:03:35,270 --> 01:03:36,050
We won't.

897
01:03:36,590 --> 01:03:41,010
But that doesn't mean that those aren't massive opportunities for other companies.

898
01:03:41,950 --> 01:03:45,090
So the answer is, how many opportunities are there?

899
01:03:45,590 --> 01:03:52,170
Well, the real question is, if there's 400 million companies that are currently in the market today,

900
01:03:52,290 --> 01:03:57,110
well, how many digital companies will there be based upon digital capital that could be successful?

901
01:03:58,030 --> 01:04:00,830
I don't know why there can't be 10,000 successful ones.

902
01:04:02,390 --> 01:04:03,830
Right? And they're all different.

903
01:04:03,830 --> 01:04:10,730
I could literally reel off 20 different categories of digital company in the U.S. capital markets,

904
01:04:10,730 --> 01:04:12,530
of which we're not going to be more than one.

905
01:04:14,530 --> 01:04:20,630
And so I think we ought to put on our cheerful,

906
01:04:20,850 --> 01:04:23,410
constructive, optimistic hat here and say,

907
01:04:23,410 --> 01:04:26,810
okay, we've got the world's greatest financial technology.

908
01:04:27,430 --> 01:04:32,750
Is there opportunity for people, for entrepreneurs or corporations to do good?

909
01:04:33,110 --> 01:04:37,490
Yeah, there ought to be 10,000 private startups that are using Bitcoin.

910
01:04:37,490 --> 01:04:40,850
and there ought to be thousands of public companies using Bitcoin.

911
01:04:41,350 --> 01:04:48,930
And the fact that you bought the stock, you know, at the all-time high and it traded down is the same, you know,

912
01:04:49,370 --> 01:04:55,610
it's the same disappointment of the people that forgot that Bitcoin traded at an all-time high 95 days ago.

913
01:04:56,310 --> 01:04:56,950
It's like, Jesus.

914
01:04:58,690 --> 01:05:01,450
It's like, you know, you call yourself an investor.

915
01:05:01,450 --> 01:05:09,470
if you haven't struggled for four years you're not you're not even you know a casual investor

916
01:05:09,470 --> 01:05:17,090
you're just a speculator or a trader right you know and and if you're really building if you're

917
01:05:17,090 --> 01:05:23,330
a business person if you're an industrialist you ought to sign up for a decade 10 years

918
01:05:23,330 --> 01:05:28,650
and you know and if you've been doing something for 10 years and you haven't succeeded after 10

919
01:05:28,650 --> 01:05:33,290
years, it's reasonable to say, maybe I don't have it, or maybe this was not the right idea.

920
01:05:34,290 --> 01:05:41,470
But for these companies, you ought to give them a 10-year runway. And so instead of saying,

921
01:05:41,590 --> 01:05:46,190
well, I notice right now that all they've done is issue some equity or issue some

922
01:05:46,190 --> 01:05:50,930
debt instruments to buy Bitcoin, that doesn't mean that they won't become the greatest insurance

923
01:05:50,930 --> 01:05:55,630
company in the UK, or the greatest bank, or the greatest credit issuer.

924
01:05:55,630 --> 01:05:58,050
Yeah, that's totally fair.

925
01:05:58,450 --> 01:06:01,530
You said a little earlier that you would never be interested,

926
01:06:01,610 --> 01:06:03,850
or you likely wouldn't be interested in becoming a bank.

927
01:06:03,990 --> 01:06:06,330
That is something that a lot of people have speculated about strategy.

928
01:06:06,650 --> 01:06:07,090
We wouldn't.

929
01:06:07,250 --> 01:06:08,750
You wouldn't do that. Why not?

930
01:06:10,010 --> 01:06:17,390
Yeah, because we have a business which, in theory, is almost infinitely scalable.

931
01:06:17,390 --> 01:06:24,330
If you look at the existing business, we have a product, STRC, stretch, digital credit.

932
01:06:25,330 --> 01:06:26,810
Okay, what's the perfect product?

933
01:06:26,890 --> 01:06:32,490
A product that pays you a 10% dividend with a vol of one or two that's publicly traded?

934
01:06:32,830 --> 01:06:34,470
What's the market size for that?

935
01:06:36,250 --> 01:06:37,090
$10 trillion?

936
01:06:38,970 --> 01:06:43,750
Right, there's $100 trillion easy, you know, addressable market for that.

937
01:06:43,750 --> 01:06:48,450
If we were 10% of that treasury credit market, it would be $10 trillion.

938
01:06:48,930 --> 01:06:52,850
So I have a product which has got a total addressable market of $10 trillion.

939
01:06:52,850 --> 01:06:55,930
OK, who wants it?

940
01:06:56,250 --> 01:06:57,110
Everybody wants it.

941
01:06:57,390 --> 01:06:59,810
Who wants a bank account that pays it?

942
01:06:59,890 --> 01:07:01,610
By the way, what if it got to zero vol?

943
01:07:02,510 --> 01:07:06,310
We actually think that our business idea is simple.

944
01:07:06,430 --> 01:07:07,650
Bitcoin is digital capital.

945
01:07:10,070 --> 01:07:11,510
Stretch is digital credit.

946
01:07:13,570 --> 01:07:19,170
If you create something on top of it that strips it to zero vol is digital money.

947
01:07:20,170 --> 01:07:22,770
A bank account that pays you 8%.

948
01:07:22,770 --> 01:07:25,130
You know, people are trying that right now.

949
01:07:25,230 --> 01:07:28,190
There's a number of people that are trying to create digital money.

950
01:07:28,830 --> 01:07:30,990
Is that essentially like a Bitcoin-backed stablecoin at that point?

951
01:07:31,630 --> 01:07:31,830
Yeah.

952
01:07:32,610 --> 01:07:34,370
Yeah, so I create a stablecoin.

953
01:07:34,570 --> 01:07:40,570
Let's say I strip the ball to zero, and it's just that you put in $19,000.22,

954
01:07:40,950 --> 01:07:45,690
and you get out $19,000.22, and while you're waiting, you collect 8%.

955
01:07:45,690 --> 01:07:48,890
Okay, a bank account that pays 8%.

956
01:07:49,230 --> 01:07:50,970
What's every other bank account pay?

957
01:07:50,970 --> 01:07:59,210
3.5% right now in the US dollars, 50 basis points in yen, 100 basis points in euros or 150 at best.

958
01:07:59,890 --> 01:08:06,070
Okay. So a bank account that pays 8% back by digital credit, how do you credit? You blend

959
01:08:06,070 --> 01:08:12,570
in a mixture of credit and currency. By the way, you can actually, you can crank the leverage down

960
01:08:12,570 --> 01:08:17,410
to 80% and you pay 8% or you can crank the leverage up to 1.5 and pay 15%.

961
01:08:17,410 --> 01:08:23,810
percent. Slightly more risk at 1.5 than it is at eight, but people will do both. They'll crank the

962
01:08:23,810 --> 01:08:30,210
leverage up and they'll crank it down. Okay. What's digital money? Digital money is zero vol

963
01:08:30,210 --> 01:08:35,450
with a yield and access of the risk-free rate. Who wants it? Everybody wants it. How big's the

964
01:08:35,450 --> 01:08:42,030
market? If you had a bank, if you had a bank in the UAE that paid 8% on bank deposits,

965
01:08:42,030 --> 01:08:44,590
might you get $10 trillion?

966
01:08:45,630 --> 01:08:48,090
Okay, you could charge 100 basis points, Danny.

967
01:08:49,150 --> 01:08:51,210
Charge 100 basis points on $10 trillion.

968
01:08:53,790 --> 01:08:55,110
That's $100 billion a year.

969
01:08:56,490 --> 01:08:59,850
Okay, the entire gross national product of Abu Dhabi

970
01:08:59,850 --> 01:09:01,070
is $330 billion.

971
01:09:01,870 --> 01:09:04,170
And in that case, every rich person in the world

972
01:09:04,170 --> 01:09:05,150
is going to be sending their money there.

973
01:09:05,150 --> 01:09:12,590
which is the perfect nation-state strategy,

974
01:09:13,070 --> 01:09:15,330
the perfect business strategy,

975
01:09:15,730 --> 01:09:17,770
the perfect banking strategy,

976
01:09:18,170 --> 01:09:20,270
the perfect product strategy.

977
01:09:21,630 --> 01:09:25,330
Okay, if you're UAE, what do you want?

978
01:09:25,370 --> 01:09:26,330
Do you want all the people in the world

979
01:09:26,330 --> 01:09:27,050
or just their money?

980
01:09:28,170 --> 01:09:29,190
I'll give you a choice.

981
01:09:29,410 --> 01:09:30,790
You can have all the people in the world.

982
01:09:30,910 --> 01:09:32,010
No, I don't want a billion people.

983
01:09:32,110 --> 01:09:33,490
You can have all the rich people in the world.

984
01:09:33,490 --> 01:09:35,370
Oh, now I have 20 million people here.

985
01:09:35,910 --> 01:09:38,170
Or you can just have all the money of the rich people in the world.

986
01:09:39,570 --> 01:09:40,650
I just want their money.

987
01:09:41,490 --> 01:09:41,890
Okay.

988
01:09:42,110 --> 01:09:43,090
How do you do it?

989
01:09:43,670 --> 01:09:49,910
Just take a bank, offer a digital money account, pay 8%, keep 100 basis points, buy digital

990
01:09:49,910 --> 01:09:53,350
credit, blend it with some currency equivalents.

991
01:09:53,450 --> 01:09:55,110
Maybe you put on a volatility buffer.

992
01:09:55,270 --> 01:09:56,930
Maybe you don't need a volatility buffer.

993
01:09:57,930 --> 01:09:58,290
Okay.

994
01:09:58,390 --> 01:10:00,770
Now you make 100 basis points.

995
01:10:00,770 --> 01:10:02,150
You slurp up 10 trillion.

996
01:10:02,150 --> 01:10:06,050
Now you've increased your gross national product by 30%.

997
01:10:06,050 --> 01:10:08,750
Slurp up 30%, double the GDP.

998
01:10:09,850 --> 01:10:11,070
Okay, I double the GDP.

999
01:10:11,410 --> 01:10:12,370
How many people does it take?

1000
01:10:12,470 --> 01:10:12,890
Oh, 100.

1001
01:10:14,110 --> 01:10:18,050
Okay, 100 people making 100 billion a year.

1002
01:10:18,570 --> 01:10:21,410
Okay, I give you an idea to make a billion dollars a person a year.

1003
01:10:22,590 --> 01:10:24,090
You have a better idea for me?

1004
01:10:26,670 --> 01:10:28,030
I don't have a better idea.

1005
01:10:28,150 --> 01:10:28,690
Absolutely not.

1006
01:10:28,690 --> 01:10:31,950
Okay, so now we're back to the question of why don't I do

1007
01:10:31,950 --> 01:10:40,770
something else. Okay. Because I'm giving you the ideal product. Digital credit is the feedstock

1008
01:10:40,770 --> 01:10:49,430
to the entire banking system. In fact, if you create digital money, not only do you take all

1009
01:10:49,430 --> 01:10:54,650
the bank deposits, you take all the treasury credit, you take all the repos, you take all

1010
01:10:54,650 --> 01:11:00,750
the short dated instruments. But if you look at everyone that bought junk bonds, corporate bonds,

1011
01:11:00,750 --> 01:11:06,770
mortgage-backed securities, five-year bonds, 10-year bonds, sovereign debt, municipal bonds.

1012
01:11:07,170 --> 01:11:12,910
Why did they not just put their money in a money market? The answer is they were reaching for yield

1013
01:11:12,910 --> 01:11:23,610
or a tax advantage, right? How big is that? $300 trillion, maybe more. Okay. How much of that

1014
01:11:23,610 --> 01:11:30,030
capital would simply go to a bank account that paid, by the way, all that capital blended in

1015
01:11:30,030 --> 01:11:34,610
yields 5%, all of it.

1016
01:11:35,410 --> 01:11:36,570
And what do you do?

1017
01:11:36,650 --> 01:11:40,370
You take on duration risk and you take on credit risk

1018
01:11:40,370 --> 01:11:42,030
to get to 5%.

1019
01:11:42,030 --> 01:11:46,470
If you don't want that, you're ripped back to 3% or 2%

1020
01:11:46,470 --> 01:11:48,350
or whatever the number is.

1021
01:11:51,110 --> 01:11:54,170
So I offer a bank and I offer you 7%.

1022
01:11:54,170 --> 01:11:56,910
How much of the $300 trillion would go to that?

1023
01:11:56,910 --> 01:11:59,490
No duration risk, no credit risk.

1024
01:11:59,490 --> 01:12:00,250
All of it.

1025
01:12:00,410 --> 01:12:00,930
All of it.

1026
01:12:02,050 --> 01:12:02,850
All of it.

1027
01:12:03,570 --> 01:12:03,850
OK.

1028
01:12:04,970 --> 01:12:06,310
Now, here's the issue.

1029
01:12:06,690 --> 01:12:07,950
How do you create digital money?

1030
01:12:08,990 --> 01:12:22,050
Well, to create digital money, you need to take digital credit, blend it with a little bit of currency so you have a liquidity buffer, maybe put on a reserve on top of it for a volatility buffer.

1031
01:12:22,270 --> 01:12:25,470
Then you need to get a regulatory stamp of approval, right?

1032
01:12:25,470 --> 01:12:41,290
You need a banking regulator to say you can offer the account or you need a securities regulator to say, OK, you can offer this as an ETF or you can offer this as a private fund or you need a digital assets regulator to say you can offer this as a digital stablecoin.

1033
01:12:42,250 --> 01:12:42,410
OK.

1034
01:12:43,510 --> 01:12:45,390
So you put the regulatory stamp on it.

1035
01:12:45,450 --> 01:12:46,350
You put the buffer on it.

1036
01:12:46,410 --> 01:12:48,430
You do some active management for redemption.

1037
01:12:48,670 --> 01:12:53,070
You know, people want daily redemptions and they want it to hold stable NAV.

1038
01:12:53,070 --> 01:12:55,910
And so we can't necessarily do that.

1039
01:12:56,010 --> 01:13:03,490
Like, I can't give you a regulated bank account in the UAE because, you know, Mike, are you going to start a bank in the UAE?

1040
01:13:04,090 --> 01:13:04,530
No.

1041
01:13:05,610 --> 01:13:06,490
Like, I can't.

1042
01:13:06,550 --> 01:13:07,750
Why would I do that, right?

1043
01:13:08,710 --> 01:13:09,690
They can do that.

1044
01:13:10,710 --> 01:13:13,330
Am I going to start a bank to compete with Morgan Stanley?

1045
01:13:13,330 --> 01:13:24,070
well you know you know i think like in 1860 right morgan stanley got started 18 they were

1046
01:13:24,070 --> 01:13:30,770
financing the civil war okay right and so the point is why would i want to do why do i want

1047
01:13:30,770 --> 01:13:34,510
to compete with jp morgan or morgan stanley i don't want to i don't want to stick to what you're

1048
01:13:34,510 --> 01:13:41,010
good at with fab or emirates bank or barclays bank i don't probably i don't need to yeah right

1049
01:13:41,010 --> 01:13:49,710
Because if you want to create digital money, you need digital credit, STRC, okay?

1050
01:13:49,890 --> 01:13:51,230
How many banks are there in the world?

1051
01:13:52,290 --> 01:13:52,610
Thousands.

1052
01:13:53,730 --> 01:13:54,410
Tens of thousands.

1053
01:13:55,630 --> 01:13:57,570
There's 5,000 banks in the US.

1054
01:13:57,750 --> 01:14:01,170
Must be tens of thousands of banks.

1055
01:14:01,430 --> 01:14:06,770
So there's no shortage of banks with sales forces and good relationships with regulators, right?

1056
01:14:06,770 --> 01:14:11,790
There's a bank in Japan that gets along well with, you know, the Japanese regulators.

1057
01:14:11,970 --> 01:14:14,350
Do I want to go to Japan and start the world's biggest bank in Japan?

1058
01:14:14,470 --> 01:14:14,970
Of course not.

1059
01:14:15,350 --> 01:14:17,190
Do I want to start the world's biggest bank in Germany?

1060
01:14:17,310 --> 01:14:17,770
Of course not.

1061
01:14:17,830 --> 01:14:18,750
Do I want to be Deutsche Bank?

1062
01:14:18,990 --> 01:14:21,430
Do I want to be, you know, the biggest bank in Switzerland?

1063
01:14:21,810 --> 01:14:22,350
Of course not.

1064
01:14:23,030 --> 01:14:26,270
So there's no point in competing with the banking business.

1065
01:14:27,490 --> 01:14:34,530
The idea is digital money, high-powered money, high-powered money based on Bitcoin.

1066
01:14:35,070 --> 01:14:37,250
That's the idea, not my idea, right?

1067
01:14:37,450 --> 01:14:41,810
I mean, it popped up many years ago in the Bitcoin community.

1068
01:14:43,830 --> 01:14:49,450
So if you want to create high-powered money, you need to strip the ball and you need to

1069
01:14:49,450 --> 01:14:52,210
integrate it into the currency system of the world.

1070
01:14:52,350 --> 01:14:55,150
And so I think it's a simple three-step process.

1071
01:14:55,150 --> 01:14:56,750
You start with digital capital.

1072
01:14:57,710 --> 01:14:59,210
You layer on digital credit.

1073
01:14:59,210 --> 01:15:07,550
and then a third party, a bank or a money manager, actively manages it and then puts the regulatory approval on it

1074
01:15:07,550 --> 01:15:10,470
and then markets it and brands it to create digital money.

1075
01:15:11,150 --> 01:15:12,430
Vanguard can create it.

1076
01:15:12,530 --> 01:15:13,810
BlackRock can create it.

1077
01:15:13,890 --> 01:15:15,250
Emirates Bank can create it.

1078
01:15:15,330 --> 01:15:16,610
Deutsche Bank can create it.

1079
01:15:17,590 --> 01:15:19,270
Morgan Stanley can create it.

1080
01:15:19,330 --> 01:15:20,610
JP Morgan can create it.

1081
01:15:20,610 --> 01:15:29,030
Do you not agree with me that those are all much better brands with much better distribution, with much better platforms?

1082
01:15:29,210 --> 01:15:39,890
my company. So a successful business strategy is not compete with everybody and be intentionally

1083
01:15:39,890 --> 01:15:47,590
obnoxious. We don't need to topple the United States government. We don't need to topple the

1084
01:15:47,590 --> 01:15:52,190
banking system. We don't need to topple the dollar. We don't need to topple the credit market. We don't

1085
01:15:52,190 --> 01:15:57,070
need to topple the commercial banks, the investment banks. We don't need to replace any of them. What

1086
01:15:57,070 --> 01:16:00,970
we need to do is figure out how to make them successful and make them the best version of

1087
01:16:00,970 --> 01:16:09,650
themselves. In this particular case, you take STRC, you take a digital credit instrument,

1088
01:16:09,650 --> 01:16:19,850
and you offer it as the universal financial sweetener, as the feedstock. It's diesel or

1089
01:16:19,850 --> 01:16:26,510
kerosene. It's like I show up in Saudi Arabia and I got gasoline. What I don't have is service

1090
01:16:26,510 --> 01:16:34,530
stations and auto dealerships and highways and auto manufacturers and driver's education schools

1091
01:16:34,530 --> 01:16:42,010
and police force and garages. And do I want to create all that? No. I just literally want to

1092
01:16:42,010 --> 01:16:48,970
sell tankers worth of gasoline. And I want some local business. It's like, if I should happen to

1093
01:16:48,970 --> 01:16:53,850
find someone that already has all that stuff. Why build it? I would like to say, well, you know,

1094
01:16:53,850 --> 01:16:58,230
here, I'm going to give you something 10 times better than what you're currently running your

1095
01:16:58,230 --> 01:17:02,870
industry on, and then you get to get rich. I mean, that sounds like a good deal.

1096
01:17:03,250 --> 01:17:10,490
Now, here's the most important question. If I offer you a digital credit instrument that pays

1097
01:17:10,490 --> 01:17:16,250
you, say, right now it's 11% dividend tax deferred, but let's say it's 10% to make the math easy.

1098
01:17:16,250 --> 01:17:20,710
I give you 10% dividend income on a digital credit instrument.

1099
01:17:23,150 --> 01:17:24,770
How much do you want to buy?

1100
01:17:26,230 --> 01:17:29,510
It's like infinite.

1101
01:17:30,750 --> 01:17:32,090
Okay, what's the market for that?

1102
01:17:32,150 --> 01:17:35,050
The market for that literally is $10, $20, $30 trillion.

1103
01:17:35,550 --> 01:17:37,630
Okay, then the question is why wouldn't you buy it?

1104
01:17:39,590 --> 01:17:41,250
What's keeping you from buying that?

1105
01:17:41,250 --> 01:17:58,290
Like if I'm going to give you something which is 10% yielding and you can build any bank account or any money market fund, private or public, or any stable coin or anything on top of it, okay?

1106
01:17:58,510 --> 01:18:08,490
And if the market right now is $300 trillion of credit offering 5% and we're offering 10%, by the way, it's 10% tax deferred.

1107
01:18:08,490 --> 01:18:11,410
So it's really 15% blended.

1108
01:18:11,990 --> 01:18:15,730
So if we have something which is three times better than the rest of the world,

1109
01:18:15,810 --> 01:18:17,270
why wouldn't you buy it?

1110
01:18:17,670 --> 01:18:18,290
Tell me.

1111
01:18:18,630 --> 01:18:19,810
I mean, I don't know why you won't buy it.

1112
01:18:19,810 --> 01:18:21,810
I guess the only reason someone maybe won't buy it

1113
01:18:21,810 --> 01:18:24,670
is if they didn't trust the sort of Bitcoin backside of it.

1114
01:18:25,630 --> 01:18:28,350
Okay, well, we can rifle through them.

1115
01:18:29,010 --> 01:18:32,310
Okay, I wouldn't buy it because I don't believe in,

1116
01:18:32,390 --> 01:18:34,070
I think Bitcoin's going to zero tomorrow.

1117
01:18:34,190 --> 01:18:35,170
I don't trust Bitcoin.

1118
01:18:35,170 --> 01:18:42,130
then I don't buy it because I don't trust the credit of the issuer.

1119
01:18:43,430 --> 01:18:47,170
For example, I want to sell you $10 billion of this instrument,

1120
01:18:47,310 --> 01:18:49,790
but I've only got $1 billion of Bitcoin to back it.

1121
01:18:51,150 --> 01:18:51,530
You see?

1122
01:18:51,830 --> 01:18:51,930
Yeah.

1123
01:18:52,150 --> 01:18:56,450
If the issuer isn't credit worthy, I wouldn't buy it.

1124
01:18:56,990 --> 01:18:59,410
And then the third reason I wouldn't buy it

1125
01:18:59,410 --> 01:19:03,510
is because I think the management team is distracted by other things.

1126
01:19:05,170 --> 01:19:10,990
And that's a very long-winded answer to your question, why wouldn't I want to be a bank?

1127
01:19:11,290 --> 01:19:15,950
And the fourth reason I wouldn't buy it is because the person that's offering it to me wants to compete with me.

1128
01:19:17,570 --> 01:19:20,530
So the answer to the question is because you don't want to get distracted.

1129
01:19:20,630 --> 01:19:22,630
You want to focus on what you're doing right now.

1130
01:19:22,890 --> 01:19:24,650
Laser-like, laser-focused.

1131
01:19:24,650 --> 01:19:48,190
Like if you've created the world's greatest product, and if you have a vision for a digital transformation of the monetary system of the world and the banking system of the world and the credit markets of the world, if that vision is digital credit built on digital capital, then why wouldn't you focus on that?

1132
01:19:48,370 --> 01:19:52,470
Everything else is a dilutive distraction, right?

1133
01:19:52,470 --> 01:20:09,950
Right? Like, you have the world's greatest product. You can either sell a trillion dollars of it, or you can go find the next thing. You understand that your odds of actually succeeding at the first thing go down exponentially if you come up with a second idea.

1134
01:20:09,950 --> 01:20:19,310
When you split to three, four ideas, your odds of succeeding fall exponentially.

1135
01:20:20,890 --> 01:20:26,670
And so it's not a good idea to get distracted.

1136
01:20:27,670 --> 01:20:30,670
It's also, by the way, it's not a good idea to compete with your customer.

1137
01:20:30,670 --> 01:20:38,710
if if i'm actually knocking on the door of jp morgan and first bank of abu dhabi and emirates

1138
01:20:38,710 --> 01:20:45,550
bank and morgan stanley and city and bank of america and blackrock and vanguard and i'm offering

1139
01:20:45,550 --> 01:20:51,150
them digital money it's like like here's

1140
01:20:51,150 --> 01:20:56,110
let's talk about sales, Danny.

1141
01:20:57,190 --> 01:21:01,090
You're a salesperson and you show up to the customer.

1142
01:21:01,990 --> 01:21:03,030
Here's your two pitches.

1143
01:21:04,510 --> 01:21:06,930
I've got the best company in the world.

1144
01:21:07,290 --> 01:21:11,050
We're the smartest and you should buy our stock and bet on us because we're smart.

1145
01:21:12,210 --> 01:21:13,130
That's a pitch.

1146
01:21:14,210 --> 01:21:18,790
Or I've got the best product in the world.

1147
01:21:18,790 --> 01:21:26,650
you can buy this product it will cut your cost to zero and it'll delight you and you'll you know

1148
01:21:26,650 --> 01:21:33,790
it'll be very enjoyable it's like the iphone it's consumer product that's pitch or i have an

1149
01:21:33,790 --> 01:21:40,250
industrial product if you buy this you can create robots and be the most valuable company in the

1150
01:21:40,250 --> 01:21:44,330
world yourself i'm going to give you a chip and you'll become the most valuable company in the

1151
01:21:44,330 --> 01:21:49,330
I have unlimited free thermonuclear reactor in a pocket,

1152
01:21:49,330 --> 01:21:50,970
and you can put it into your cars,

1153
01:21:50,970 --> 01:21:53,470
and you can create flying hover cars,

1154
01:21:53,470 --> 01:21:56,210
and you can become the greatest company on earth

1155
01:21:56,210 --> 01:21:57,150
with the greatest power.

1156
01:21:57,185 --> 01:22:03,705
on earth and I'll be your vendor or even better I have a product you can put it into your bank

1157
01:22:03,705 --> 01:22:07,365
your bank will be the biggest bank in the world and your country will be the most the richest

1158
01:22:07,365 --> 01:22:11,205
country in the world and your country and your children's children's children will be rich

1159
01:22:11,205 --> 01:22:16,205
forever and you'll be the most powerful company and the most powerful country with the most

1160
01:22:16,205 --> 01:22:20,245
prosperous people and you'll create the greatest company because you'll have the greatest product

1161
01:22:20,245 --> 01:22:26,005
in the world and I'm just going to be your humble supplier which of the three sales pitches do you

1162
01:22:26,005 --> 01:22:32,565
think is the most powerful sales pitch. Easy decision. Yeah, you see? And this is the point

1163
01:22:32,565 --> 01:22:38,685
of Bitcoin, which is, I don't show up and say, guess what? I invented something smarter than

1164
01:22:38,685 --> 01:22:42,005
what you have, and you're stupid, and I'm smart, and we're going to crush you to death because

1165
01:22:42,005 --> 01:22:48,885
you're stupid, and we're better, right? Don't show up with that pitch. Or, you know, you have

1166
01:22:48,885 --> 01:22:54,085
this business, you have a bank, but it's a 20th century bank, and it's going to zero. So what you

1167
01:22:54,085 --> 01:22:58,925
ought to do is just sell your stock in that bank and buy the stock in my digital bank, which is 21st

1168
01:22:58,925 --> 01:23:06,525
century. There's no reason to be confrontational and negative. Why don't you be inclusive and

1169
01:23:06,525 --> 01:23:16,045
aspirational? Let everyone else win with you. And that's my view with Bitcoin all the way forward.

1170
01:23:16,165 --> 01:23:21,705
Bitcoin is for everybody. Everybody is better with Bitcoin. The government, the corporation,

1171
01:23:21,705 --> 01:23:26,085
the people richer than you, people more powerful than you, people more famous than you,

1172
01:23:26,905 --> 01:23:31,725
right? People that have politics you disagree with, they can all embrace Bitcoin and they will

1173
01:23:31,725 --> 01:23:36,505
all benefit from it and you will benefit from it, right? That's at the base layer. That's digital

1174
01:23:36,505 --> 01:23:42,025
capital. With digital credit, you know, we're creating digital credit. Am I worried that

1175
01:23:42,025 --> 01:23:46,805
someone else might copy it? No, because if 100 companies copy it and they also issue digital

1176
01:23:46,805 --> 01:23:53,525
that will accelerate the transformation of the credit markets and we all win together right

1177
01:23:53,525 --> 01:24:00,345
they're actually helping we're helping each other that's a good thing to embrace that and then when

1178
01:24:00,345 --> 01:24:06,065
you go to see the customer right the small ideas is we have a great product you should buy our equity

1179
01:24:06,065 --> 01:24:14,525
the bigger idea is we have a great product you should buy the product to make your life better

1180
01:24:14,525 --> 01:24:19,045
But the greatest idea is we have a digital credit product.

1181
01:24:19,165 --> 01:24:28,945
You can actually build it into your financial product, build it into your bank, build it into your future, and you can have the greatest product in the world.

1182
01:24:29,265 --> 01:24:31,505
And you can be the greatest company in the world.

1183
01:24:31,625 --> 01:24:35,965
And you can be the most powerful nation in the world.

1184
01:24:37,325 --> 01:24:38,445
Empower others.

1185
01:24:39,485 --> 01:24:40,045
Right?

1186
01:24:40,045 --> 01:24:44,165
Empower others by allowing them to be part of your future.

1187
01:24:44,525 --> 01:24:49,085
And you can see, if you want Bitcoin, what is hyper-Bitcoinization?

1188
01:24:49,945 --> 01:24:54,385
Hyper-Bitcoinization is not all the governments and the banks and the corporations all go away.

1189
01:24:55,085 --> 01:24:56,165
Yes, they all have Bitcoin.

1190
01:24:56,445 --> 01:25:02,065
Next time you sit in a dentist's chair and you look up and imagine all the governments and all the corporations went away.

1191
01:25:02,125 --> 01:25:08,185
And then imagine the guy that manufactures the Novocaine and the drill bit and the x-ray machine also went away.

1192
01:25:08,285 --> 01:25:10,505
And then think about how they deal with your toothache.

1193
01:25:10,505 --> 01:25:17,045
The point is, the future is not corporations and governments go away and banks go away.

1194
01:25:17,125 --> 01:25:21,345
The future is not currencies like the dollar go away.

1195
01:25:21,985 --> 01:25:27,645
The future is, we embrace Bitcoin as digital capital.

1196
01:25:28,005 --> 01:25:32,525
We rebuild the entire economy with that as the base layer.

1197
01:25:32,525 --> 01:25:39,205
then we create products on top of it, whether it's digital insurance or digital credit or

1198
01:25:39,205 --> 01:25:44,845
digital banking or digital derivatives. And I am not the expert in digital banking,

1199
01:25:45,105 --> 01:25:49,405
digital derivatives, or digital insurance, nor am I going to purport to be. I'm just going to

1200
01:25:49,405 --> 01:25:53,985
focus on digital credit. And I'm not even the expert in digital credit because there's 100

1201
01:25:53,985 --> 01:25:59,745
flavors of digital credit. I'm just going to focus upon the digital credit that we focused on

1202
01:25:59,745 --> 01:26:02,445
and digital treasury credit.

1203
01:26:04,345 --> 01:26:07,905
And what I would say is that if you actually take that credit

1204
01:26:07,905 --> 01:26:14,065
and then you synchronize it with the dollar and the yen and the euro

1205
01:26:14,065 --> 01:26:17,785
and the real and the pound,

1206
01:26:18,225 --> 01:26:23,405
you synchronize the digital credit with the currency systems of the world

1207
01:26:23,405 --> 01:26:26,245
and you're synchronizing it with the $300 trillion credit market,

1208
01:26:26,245 --> 01:26:31,465
then that becomes the base layer for a new type of digital money.

1209
01:26:32,245 --> 01:26:44,505
And high-powered money is the yen yielding 6%, the pound yielding 8%, the dollar yielding 8%, the euro yielding whatever it yields.

1210
01:26:44,505 --> 01:27:02,705
Whatever the currency frame of reference is, wherever your liabilities are, I'm going to give you that with no currency risk, but with a risk-free rate, ideally, which exceeds the inflation rate of that currency.

1211
01:27:02,705 --> 01:27:16,365
Right. If if the dollar is expanding at eight percent and I can give you digital money that yields eight percent tax deferred, then I just gave you a completely stable instrument that lets you keep up with inflation.

1212
01:27:17,125 --> 01:27:23,305
And then you don't got to complain that you bought Bitcoin at the all time high 94 days ago and now it's traded down.

1213
01:27:23,305 --> 01:27:30,945
Or, you know, you bought whatever stock, some Bitcoin treasury company three months ago when it traded down.

1214
01:27:30,945 --> 01:27:36,125
I mean, the truth is when you buy Bitcoin, you're a capital investor.

1215
01:27:36,385 --> 01:27:38,125
You've got to have a four-year time horizon.

1216
01:27:38,285 --> 01:27:40,505
When you buy equity, you're an equity investor.

1217
01:27:40,905 --> 01:27:42,585
You've got to have a four-year time horizon.

1218
01:27:43,165 --> 01:27:45,405
And you take equity risk, right?

1219
01:27:45,465 --> 01:27:54,405
It's like if you don't want to take risk and you don't want to take duration, you don't want credit risk, you don't want duration risk, you don't want equity risk, you want money.

1220
01:27:54,965 --> 01:27:56,025
Who do you want it from?

1221
01:27:56,125 --> 01:27:57,905
You want it from a too-big-to-fail bank.

1222
01:27:58,785 --> 01:28:00,865
So what is the future?

1223
01:28:02,405 --> 01:28:11,245
The brilliant future is the 200 biggest banks in the world offer digital money accounts that pay double what traditional money markets pay.

1224
01:28:12,265 --> 01:28:19,505
And 10% or 20% of the money in the world flows into those bank accounts, maybe 30, maybe 40, maybe 50.

1225
01:28:20,405 --> 01:28:21,425
Remember what I said, though?

1226
01:28:21,465 --> 01:28:26,185
It took 30 years for 75% of the people to agree that electricity made sense.

1227
01:28:26,185 --> 01:28:37,445
How long did it take any rational thinker? 30 seconds. It takes 30 seconds for a rational thinker to figure out what it took the world 30 years to 75% agree on.

1228
01:28:37,445 --> 01:28:54,265
So if we create digital credit and we wire it and then we create digital money and then we wire it into the banking system of the world, you're going to have delivered a product which is three times better.

1229
01:28:54,665 --> 01:29:02,665
Or depending on how valuable is it for you to collect $120,000 a year instead of $40,000 a year?

1230
01:29:02,725 --> 01:29:05,045
Is that three times better or is that infinitely better?

1231
01:29:05,805 --> 01:29:05,985
Yeah.

1232
01:29:05,985 --> 01:29:07,185
Might be infinitely better.

1233
01:29:07,445 --> 01:29:14,965
Right. So we'll create that. It'll take them out of time. And what's the risk factor?

1234
01:29:15,785 --> 01:29:25,985
The risk factor is distraction of the management team. It's ego. Right. It's always ego, Danny.

1235
01:29:25,985 --> 01:29:33,425
It's you have something good and your ego tells you you got to make it better. Right. It's like

1236
01:29:33,425 --> 01:29:41,045
if you want to segue into the controversy du jour right now, it's like Bitcoin will fail if it

1237
01:29:41,045 --> 01:29:46,745
doesn't have larger block sizes. That was the controversy. Then Bitcoin will fail, and that

1238
01:29:46,745 --> 01:29:52,045
gave us the block size. Bitcoin will fail unless it has more functionality, and that gave us tap

1239
01:29:52,045 --> 01:29:59,385
root. Bitcoin will fail if it doesn't use less energy, and that gave us the ESG wars. Bitcoin

1240
01:29:59,385 --> 01:30:06,205
will fail if a billion people can't self-custody and all of a sudden you need 100-bit proposals to

1241
01:30:06,205 --> 01:30:11,865
scale that up. Bitcoin will fail if it doesn't have smart contracts and you need that.

1242
01:30:12,325 --> 01:30:19,165
Bitcoin will fail unless we're quantum resistant right now. And it's all of this alarmism and it's

1243
01:30:19,165 --> 01:30:24,445
ego. People have these ideas and they want to be very important. And so they want to represent

1244
01:30:24,445 --> 01:30:30,985
their ego, and they want to drive dilutive distractions a hundred ways.

1245
01:30:32,245 --> 01:30:38,185
And I would say that's how empires fail.

1246
01:30:38,785 --> 01:30:40,225
Why is California struggling?

1247
01:30:41,185 --> 01:30:45,565
Because you get so rich and so successful that you feel like you can do whatever you want.

1248
01:30:47,205 --> 01:30:47,465
Right?

1249
01:30:47,825 --> 01:30:49,645
Why is Europe struggling?

1250
01:30:49,645 --> 01:30:58,545
It's like after you win, you decide you have to declare universal health care, universal child care, universal this care, universal that care, universal whatever.

1251
01:30:59,905 --> 01:31:05,045
Like the idea that in California they're giving reparations to slaves.

1252
01:31:05,145 --> 01:31:08,745
No one was ever a slave and people that lived there never had slaves.

1253
01:31:08,885 --> 01:31:16,665
And yet somehow we think we can right a wrong that took place somewhere else in the world to other people because we have infinite money.

1254
01:31:16,665 --> 01:31:24,465
so i think that every empire collapses because people think they've been successful so now they

1255
01:31:24,465 --> 01:31:31,665
can expand right and and that's the most pernicious thing at a protocol level it's the

1256
01:31:31,665 --> 01:31:36,245
most pernicious thing at a city when the mayor of the city says hey we're going to give free needles

1257
01:31:36,245 --> 01:31:41,445
and free health care and free housing and free whatever and free uber rides and free blah blah

1258
01:31:41,445 --> 01:31:47,045
blah, blah. We're going to raise taxes to do it. And then everyone that crates the capital leaves.

1259
01:31:47,385 --> 01:31:53,065
And then everyone that doesn't have any that's a liability arrives. And you've swapped out your

1260
01:31:53,065 --> 01:31:59,425
productive citizens for nonproductive citizens and the entire economy collapses. Right. And did

1261
01:31:59,425 --> 01:32:03,925
it happen in Easter Island? Yeah. I mean, they thought that they could create like large stone

1262
01:32:03,925 --> 01:32:11,025
statues. It's like, you know, how to 40 foot high stone statues contribute to the economy of a,

1263
01:32:11,025 --> 01:32:16,705
you know, Pacific Island where we need fish to eat, my friend. We need the wood for the canoes

1264
01:32:16,705 --> 01:32:21,665
to catch the fish so we don't starve to death. No, we will chop them down so we can create large

1265
01:32:21,665 --> 01:32:27,085
stone statues because the gods demand it. It's like what you have is you have a tipped power

1266
01:32:27,085 --> 01:32:47,200
structure And that is my way of addressing what destroys companies Danny It the CEO and the management team are successful They like well we succeeded in this so now we can do this and now we can do the next thing And now that we doing this we expanding into this we expanding into this we expanding into this

1267
01:32:47,220 --> 01:32:48,300
and we're expanding into that.

1268
01:32:48,380 --> 01:32:50,380
Why? Why do we do it? Because we can.

1269
01:32:51,240 --> 01:32:53,020
It's a Napoleonic complex.

1270
01:32:54,440 --> 01:32:58,900
You know, it's like I got to spread my ideology and my ideas

1271
01:32:58,900 --> 01:33:03,100
to the frozen tundra of Russia in the winter,

1272
01:33:03,260 --> 01:33:06,100
and I'm going to kill them if they disagree with me,

1273
01:33:06,100 --> 01:33:15,640
spreading my ideas to them because I was put on earth to do this. So I think that my advice to

1274
01:33:15,640 --> 01:33:23,520
any entrepreneur is focus and check your ego. And the reason I can do it is because I'm 60 years old

1275
01:33:23,520 --> 01:33:31,020
and because I was 30 once. I was a 30, 35-year-old successful entrepreneur once. And as soon as I was

1276
01:33:31,020 --> 01:33:37,080
successful, I came up with 10 more ideas. And each one of them was ambitious. And I split my

1277
01:33:37,080 --> 01:33:42,160
energies and my company's energies 10 different ways. And what you realize is it's very, very

1278
01:33:42,160 --> 01:33:48,160
challenging to do one thing well in this world. And you shouldn't get distracted. So

1279
01:33:48,160 --> 01:33:55,520
we're not getting distracted, right? We're focused on an idea. It's a big idea. We want to create

1280
01:33:55,520 --> 01:34:02,520
digital credit as the base layer for digital money. And if that one idea works, that would

1281
01:34:02,520 --> 01:34:07,900
make us the biggest company on earth. And that would make that the most successful product ever.

1282
01:34:08,660 --> 01:34:16,460
And so humility dictates that once you come up with a good idea, you might want to focus 100%

1283
01:34:16,460 --> 01:34:23,800
of your energy in making that idea successful. And it's cavalier. It's cavalier and irresponsible

1284
01:34:23,800 --> 01:34:27,860
to run off and chase after the next 99 ideas

1285
01:34:27,860 --> 01:34:33,000
because you're putting at risk the important one.

1286
01:34:33,200 --> 01:34:34,040
You're putting at risk.

1287
01:34:34,940 --> 01:34:39,460
That's why I'm a conservative defender of the protocol.

1288
01:34:40,360 --> 01:34:44,680
I don't like big protocol because if Bitcoin is the idea

1289
01:34:44,680 --> 01:34:48,700
and it's already succeeding and it's going from nothing

1290
01:34:48,700 --> 01:34:50,880
to $2 trillion to $20 trillion to $200 trillion,

1291
01:34:50,880 --> 01:34:54,900
then don't put that at risk, right?

1292
01:34:54,940 --> 01:35:05,600
Don't put that at risk until you have overwhelming global consensus that the thing that you're doing is necessary to de-risk it, right?

1293
01:35:05,600 --> 01:35:12,360
And if I want to destroy a company, I just walk into the boardroom with 100 good ideas and I have them fund all of them.

1294
01:35:12,360 --> 01:35:21,240
If I want to destroy the protocol, I just fund 100-bit proposals with unlimited money, and I get the best engineers, and I fund everything.

1295
01:35:22,060 --> 01:35:26,600
And if you want to destroy a city, you fund every possible program.

1296
01:35:26,840 --> 01:35:31,740
We're going to clean up the environment, and we're going to give free lunches, and free this, and free that.

1297
01:35:32,520 --> 01:35:34,580
You see what happens in Minneapolis.

1298
01:35:34,840 --> 01:35:38,620
Like, oh, we've got to give child health care, and it's free, and we've got to do it fast.

1299
01:35:38,620 --> 01:35:41,300
and pretty soon you find out that you're funding non-existent children.

1300
01:35:43,400 --> 01:35:51,100
They notice there's an explosion of autism and all of these other ADHD diagnoses.

1301
01:35:52,160 --> 01:35:58,480
Well, when the government gives you $10,000 a year for every person diagnosed with autism or ADHD,

1302
01:35:58,480 --> 01:36:01,360
you will generate a lot more of those diagnoses.

1303
01:36:01,560 --> 01:36:06,080
If the government's buying that diagnosis, the free market generates it.

1304
01:36:06,080 --> 01:36:12,820
And so if you decide, if you have infinite power or infinite money,

1305
01:36:12,860 --> 01:36:16,260
if you're a politician with infinite power and you want to pursue 100 good ideas,

1306
01:36:16,320 --> 01:36:17,680
that's what destroys the society.

1307
01:36:18,540 --> 01:36:22,660
And if you're a businessman, a CEO, and you have infinite money

1308
01:36:22,660 --> 01:36:25,880
and you have 100 good ideas and you presume that's what destroys the company.

1309
01:36:26,160 --> 01:36:28,260
Yeah. So it's just staying laser focused. I love it.

1310
01:36:29,460 --> 01:36:31,040
Earlier when you were talking about digital money,

1311
01:36:31,920 --> 01:36:35,060
recently you've just started stacking dollars as well as Bitcoin.

1312
01:36:35,640 --> 01:36:39,120
Is that with an idea of being that liquidity pool for digital money?

1313
01:36:39,200 --> 01:36:45,460
Or is that more to try and sort of get rid of some of the nervousness

1314
01:36:45,460 --> 01:36:47,600
around investing in the preferreds because of the interest payments?

1315
01:36:49,060 --> 01:36:53,140
The reason for creating a USD reserve

1316
01:36:53,140 --> 01:36:57,240
is to improve the credit worthiness of the company

1317
01:36:57,240 --> 01:36:59,000
in the eyes of the credit investors.

1318
01:36:59,000 --> 01:36:59,440
Okay.

1319
01:37:00,200 --> 01:37:00,480
Right?

1320
01:37:00,480 --> 01:37:09,040
The people that are buying the credit are buying the credit because they think Bitcoin's too volatile.

1321
01:37:09,900 --> 01:37:11,700
And they think the equity's too volatile.

1322
01:37:12,640 --> 01:37:12,920
You see?

1323
01:37:13,220 --> 01:37:13,400
Yeah.

1324
01:37:14,460 --> 01:37:14,780
Right?

1325
01:37:14,880 --> 01:37:20,220
And so you can do things that are good for a Bitcoin investor.

1326
01:37:20,220 --> 01:37:25,580
Someone that wanted, if you're an equity investor, you want more Bitcoin, more volatility.

1327
01:37:25,580 --> 01:37:33,080
But if you're a credit investor, you want something which is most creditworthy.

1328
01:37:33,240 --> 01:37:36,940
So how do you improve the creditworthiness of the company?

1329
01:37:37,300 --> 01:37:46,720
If you want to be the biggest issue of digital credit, well, those investors, they don't really have a strong view on Bitcoin one way or the other, but they don't like volatility.

1330
01:37:47,080 --> 01:37:48,700
They don't like uncertainty, right?

1331
01:37:48,700 --> 01:38:04,260
And right now, you're creating a credit profile in the eyes of, say, the S&P credit rating agencies or Fitch or Moody's, or in the eyes of a very conservative credit investor.

1332
01:38:05,900 --> 01:38:16,380
So, you know, it's complicated for me to assess the statistical risk of being able to generate $800 million of cash over the next 12 months in the equity markets.

1333
01:38:16,380 --> 01:38:22,500
but it's not complicated to assess whether or not you have $800 million of cash in the bank if you

1334
01:38:22,500 --> 01:38:31,200
have $800 million cash, right? If I said to you, if your life depended on it, like, Danny, I'm going

1335
01:38:31,200 --> 01:38:35,600
to put a gun to your head. I'm going to pull the trigger and blow your brains out if you're wrong.

1336
01:38:36,140 --> 01:38:42,820
I have $800 million in cash in the bank, and I need to pay a bill on Monday. Or I have the ability

1337
01:38:42,820 --> 01:38:46,160
to generate $800 million of cash by selling equity,

1338
01:38:46,420 --> 01:38:48,420
it's, you know, there's a lot of equity,

1339
01:38:48,680 --> 01:38:49,680
liquidity in the market,

1340
01:38:49,680 --> 01:38:51,800
and you have to risk your life.

1341
01:38:51,920 --> 01:38:54,180
Which of the two trades would you wait?

1342
01:38:54,400 --> 01:38:55,820
Even though I'd probably believe the equity,

1343
01:38:55,940 --> 01:38:56,800
you're obviously picking the money.

1344
01:38:57,440 --> 01:38:57,680
Yeah.

1345
01:38:57,760 --> 01:38:57,920
Yeah.

1346
01:38:58,580 --> 01:39:01,980
Yeah, because what we're talking about here is

1347
01:39:01,980 --> 01:39:07,940
the whole idea of credit is to strip the volatility

1348
01:39:07,940 --> 01:39:12,460
and strip the risk off of the capital.

1349
01:39:12,820 --> 01:39:13,820
Right?

1350
01:39:13,820 --> 01:39:19,820
If you're a capital investor and you have a 30-year time horizon and you have a million

1351
01:39:19,820 --> 01:39:24,020
dollars, you buy a million dollars of Bitcoin, you hold it, you get 30% AR for the rest of

1352
01:39:24,020 --> 01:39:25,020
your life.

1353
01:39:25,020 --> 01:39:26,760
It's a no-brainer.

1354
01:39:26,760 --> 01:39:33,740
If you're a three-year-old and you need $10,000 a month or X thousand dollars a month or else

1355
01:39:33,740 --> 01:39:40,680
you starve to death and you're three years old, you would settle for 10%.

1356
01:39:40,680 --> 01:39:43,700
You would settle for 10, you know, you don't want 30%.

1357
01:39:43,700 --> 01:39:50,020
You would take $10,000 a month or $8,000 a month on a million dollars of capital.

1358
01:39:50,020 --> 01:39:57,860
If I said, I'll give you $8,000 a month forever, and I'm going to keep, by the way, I'm going

1359
01:39:57,860 --> 01:40:01,460
to keep two-thirds up front, but what I'm really keeping is 90% of the capital gains.

1360
01:40:01,660 --> 01:40:09,060
If you do the math over a long period, 90% of the economic benefit goes to the company.

1361
01:40:09,620 --> 01:40:11,560
10% goes to the credit investor.

1362
01:40:13,280 --> 01:40:15,640
But if your life depended upon having the money,

1363
01:40:15,720 --> 01:40:17,520
if you were going to get thrown out of your house

1364
01:40:17,520 --> 01:40:19,360
or your marriage was going to fail

1365
01:40:19,360 --> 01:40:22,480
and your kids were going to not eat

1366
01:40:22,480 --> 01:40:24,580
or you weren't going to pay your medical bill

1367
01:40:24,580 --> 01:40:25,440
and you were going to die,

1368
01:40:26,380 --> 01:40:30,360
then all of the arguments about theoretically

1369
01:40:30,360 --> 01:40:32,020
it's better to accept the volatility.

1370
01:40:32,760 --> 01:40:33,720
They go out the window.

1371
01:40:34,580 --> 01:40:38,200
You have to accept two things if you're a capital investor.

1372
01:40:38,200 --> 01:40:43,920
And by the way, capital investor is Bitcoin holder, not equity investor.

1373
01:40:44,180 --> 01:40:45,700
Equity is MSTR holder.

1374
01:40:46,460 --> 01:40:50,380
If you're a capital investor, you have to accept volatility and duration.

1375
01:40:53,280 --> 01:40:58,640
You're not accepting the equity risk because you're just holding Bitcoin, but you're accepting,

1376
01:40:59,080 --> 01:41:03,840
you're basically saying I'm holding it for four years minimum, 10 years ideally, and you're

1377
01:41:03,840 --> 01:41:06,840
accepting 35, 45 vol.

1378
01:41:08,200 --> 01:41:12,260
But if you're a credit investor, I mean, ideally, people want zero of all.

1379
01:41:13,160 --> 01:41:17,740
I mean, the ideal product is I have a million dollars.

1380
01:41:17,880 --> 01:41:27,260
I put it into a bank, and it generates $100,000 a year, and I get $8,000 a month, and I get it every month for the rest of my life, tax-deferred ideally.

1381
01:41:27,260 --> 01:41:42,820
But whether it's taxable or not, I just want that because that way I can buy an apartment that costs me X thousands and I can pay for health care and I can go to school and I can take a girl out on a date or I can buy furniture, pay electricity.

1382
01:41:45,320 --> 01:41:45,720
Right.

1383
01:41:46,400 --> 01:41:49,920
As I've said, the world is built on capital, but the world runs on credit.

1384
01:41:49,920 --> 01:41:57,220
You know, and so what's the logic of what we're doing?

1385
01:41:57,260 --> 01:42:04,300
we're a company. What is the company's business? How are we creating value? The big way we're

1386
01:42:04,300 --> 01:42:10,820
creating value is we're creating digital credit. Who's the customer? Not the capital investor,

1387
01:42:11,380 --> 01:42:16,600
not the equity investor, right? The capital investor is buying Bitcoin. They're not our

1388
01:42:16,600 --> 01:42:20,780
customer. They're our ally. We're allies together. We're on the journey together.

1389
01:42:20,780 --> 01:42:27,840
it. The credit investor is buying STRC. They want to trade at $100 and pay them a monthly dividend,

1390
01:42:27,840 --> 01:42:31,860
and they want to know that no matter what happens to Bitcoin, no matter what happens to MSTR,

1391
01:42:32,820 --> 01:42:40,500
they're just getting that drip, right? If the customer is happy, right? If the credit investor

1392
01:42:40,500 --> 01:42:46,140
is happy, then we buy Bitcoin, and that creates amplification for the equity, and then the equity

1393
01:42:46,140 --> 01:42:53,340
has value. If the company can sell $10 billion of credit a year, and if we're capturing 90%

1394
01:42:53,340 --> 01:43:00,780
of the economic benefit of the credit, okay, I just raised $10 billion. It's going to be

1395
01:43:00,780 --> 01:43:07,060
worth $100 billion in 10 years. I just captured 90% of the benefit. I made $90 billion for the

1396
01:43:07,060 --> 01:43:09,460
equity, right?

1397
01:43:10,680 --> 01:43:14,380
I'm creating shareholder value by selling the credit.

1398
01:43:14,380 --> 01:43:29,435
The equity value is the result right That makes sense And so you running the company for the benefit of the creditors

1399
01:43:30,975 --> 01:43:34,855
But it turns out that if we run the company for the benefit of the creditors,

1400
01:43:35,055 --> 01:43:37,735
then the demand for the credit increases

1401
01:43:37,735 --> 01:43:40,255
and the stability of the credit increases, right?

1402
01:43:40,415 --> 01:43:44,575
Do you want it to trade with a vol of 1 or a vol of 10 or a vol of 20?

1403
01:43:46,175 --> 01:43:50,075
When we didn't have that USD reserve, Bitcoin crashed.

1404
01:43:50,255 --> 01:43:54,135
And STRC went from $100 down to $92.

1405
01:43:55,635 --> 01:43:59,035
And then everybody chatters like, maybe they can't pay the dividend, right?

1406
01:44:00,675 --> 01:44:08,015
And so then we put $2.25 billion of cash on the balance sheet.

1407
01:44:08,055 --> 01:44:14,235
And now you're like, well, for the next three years, they're going to pay out of the reserve, even if they can't raise equity capital.

1408
01:44:14,235 --> 01:44:17,095
So all of a sudden, that strips the risk.

1409
01:44:17,095 --> 01:44:34,275
If you strip the risk, you strip the vol. The volatility of STRC, it spiked to 19 after that crash, and now it's working its way down to like seven. It's been falling, and it should fall down to five or four or three or two or one, right?

1410
01:44:34,275 --> 01:44:41,935
So our operation is to strip the vol, and to strip the vol, we have to strip the risk.

1411
01:44:42,315 --> 01:44:47,135
And to strip the risk, it means that we have to put some cash on the balance sheet.

1412
01:44:47,895 --> 01:44:55,315
And in the near term, that's slightly dilutive to the equity.

1413
01:44:55,455 --> 01:45:00,415
Instead of a BTC yield of 27%, you might have a BTC yield of 23%.

1414
01:45:00,415 --> 01:45:00,655
Yep.

1415
01:45:01,615 --> 01:45:03,275
But at the end of the day-

1416
01:45:03,275 --> 01:45:06,215
That's because you did the ATM to do it and obviously didn't buy Bitcoin.

1417
01:45:06,215 --> 01:45:09,515
We sell some equity and we buy cash instead of buying dollars.

1418
01:45:09,735 --> 01:45:13,015
So it's near term, somewhat dilutive.

1419
01:45:14,295 --> 01:45:19,855
But on the other hand, the market was valuing us with a P to E of one.

1420
01:45:20,735 --> 01:45:30,995
Like they were giving us a premium of 23% or 25% against a BT yield of 25%.

1421
01:45:30,995 --> 01:45:33,395
So the market gives you a P to E of 1.

1422
01:45:33,475 --> 01:45:36,155
So the market doesn't believe you can keep doing that anyway.

1423
01:45:37,475 --> 01:45:48,455
Okay, so you've got to ask the question, well, if the company never sells any credit again for the next decade, then what's the yield going to be?

1424
01:45:48,635 --> 01:45:50,955
Well, the yield's going to zero.

1425
01:45:52,295 --> 01:45:53,575
And so the company trades.

1426
01:45:53,755 --> 01:45:58,675
If the company doesn't sell credit, then it doesn't matter.

1427
01:45:58,675 --> 01:46:07,635
So what you want to do is not try to maximize the BTC yield with an expectation that it's a one-year thing.

1428
01:46:07,735 --> 01:46:15,595
What you want to do is create a business model where you can generate a consistent BTC yield for the equity investors for the next decade.

1429
01:46:16,355 --> 01:46:28,035
So we'd be better if we generated a 10% yield every year for 10 years, then maybe get a P to E of 10, and then you trade at a premium of 100% to your NAV, you see.

1430
01:46:28,675 --> 01:46:35,375
That's better than a BTC yield of 25% with uncertainty about how you're getting there.

1431
01:46:35,615 --> 01:46:35,935
Totally.

1432
01:46:36,215 --> 01:46:36,875
That makes sense.

1433
01:46:37,075 --> 01:46:48,155
And the challenge that some of the Bitcoin treasury companies have is if you're just selling equity, there's an uncertainty about how many years you can continue to generate yield just by selling equity.

1434
01:46:48,155 --> 01:46:55,215
which is why you want to look at an operating model, which is some kind of financial instrument

1435
01:46:55,215 --> 01:47:01,975
or some model where you generate consistent yields through an operating business, an insurance

1436
01:47:01,975 --> 01:47:07,155
business, a banking business, a derivatives business, a financial activity, a credit business,

1437
01:47:07,295 --> 01:47:17,115
et cetera. So what we're doing is creating a digital credit vehicle. And you look at the

1438
01:47:17,115 --> 01:47:26,635
company going into 2026 and it's, you've got $2.25 billion of cash, you got $60 billion of capital,

1439
01:47:26,635 --> 01:47:36,275
of Bitcoin. Okay, you got $62, $63 billion of capital. We should reasonably be able to sell

1440
01:47:36,275 --> 01:47:42,835
a dime worth of credit for every dollar of capital. So you have $60 billion of capital,

1441
01:47:42,835 --> 01:47:48,255
sell $6 billion of credit a year. That's sustainable in theory in perpetuity, right?

1442
01:47:48,335 --> 01:47:53,415
I mean, so you're really building a business where, you know, you look to sell $6 billion

1443
01:47:53,415 --> 01:47:58,175
of credit against $60 billion of capital, have the capital appreciate to $100 billion.

1444
01:47:58,895 --> 01:48:04,515
The next year, sell $10 billion of credit, have the capital appreciate to $130, $140.

1445
01:48:04,855 --> 01:48:10,215
The next year, sell $13 billion of credit. And you're like, you know, what's your cash flow?

1446
01:48:10,215 --> 01:48:15,955
$6 billion, $10 billion, $15 billion, $20 billion, $25 billion, $30 billion.

1447
01:48:17,575 --> 01:48:24,475
The equity capital markets, they like a business model well understood, predictable.

1448
01:48:26,175 --> 01:48:34,075
The credit markets, they like an issuer, highly overcapitalized, overcollateralized,

1449
01:48:34,155 --> 01:48:36,435
and oftentimes they like third-party endorsements.

1450
01:48:36,435 --> 01:48:44,295
The thing that we're struggling against in the credit markets is the Basel rules currently give zero value to Bitcoin.

1451
01:48:44,515 --> 01:48:49,355
So you could have $60 billion, they multiply by zero, and the credit rating agencies think it's worth nothing.

1452
01:48:49,975 --> 01:48:50,335
I see.

1453
01:48:50,515 --> 01:49:02,075
So getting that zero multiplier to go to 25% or 50% or 100% is a big deal in getting institutional adoption by the traditional credit establishment.

1454
01:49:02,435 --> 01:49:03,655
So that's what we need to see in 26.

1455
01:49:03,655 --> 01:49:17,015
Yeah, if you're making a list of our regulatory hurdles, it was get the insurance companies to insure us, get the accounting profession to give us fair accounting, right?

1456
01:49:17,015 --> 01:49:22,055
Make sure the IRS and the Treasury doesn't unfairly tax us with CAMTI.

1457
01:49:22,655 --> 01:49:33,555
Make sure that the indexes don't discriminate against us by not allowing us in indexes because we're digital instead of whatever, right?

1458
01:49:33,555 --> 01:49:44,455
Get the banks to agree to bank us and extend credit and get the regulators to allow us to take a company public, which all those things we've overcome.

1459
01:49:45,375 --> 01:49:54,155
I think that the last thing to focus upon is get the banking regulators to acknowledge digital assets as assets.

1460
01:49:54,455 --> 01:49:54,615
Yeah.

1461
01:49:55,155 --> 01:49:55,495
Right.

1462
01:49:55,495 --> 01:49:55,855
Yeah.

1463
01:49:56,095 --> 01:50:02,875
You know, if someone deems you to be a non-person, say, OK, well, you're going to have 100 million voters and you all get zero votes each.

1464
01:50:03,555 --> 01:50:08,895
you don't really have equal participation in the society.

1465
01:50:09,215 --> 01:50:14,455
So moving from being non-illegitimate assets

1466
01:50:14,455 --> 01:50:17,835
to legitimate assets is a big deal.

1467
01:50:17,995 --> 01:50:18,755
And believe it or not,

1468
01:50:18,835 --> 01:50:20,615
sometimes it's a committee of like eight people

1469
01:50:20,615 --> 01:50:22,635
that decide to legitimize you or not.

1470
01:50:23,755 --> 01:50:25,075
So we need to get them on board.

1471
01:50:25,415 --> 01:50:25,635
Yeah.

1472
01:50:26,415 --> 01:50:28,555
Michael, I know you're short on time.

1473
01:50:28,675 --> 01:50:29,635
This has been amazing.

1474
01:50:30,175 --> 01:50:31,435
Thank you for having us here.

1475
01:50:31,875 --> 01:50:33,035
We're in the library.

1476
01:50:33,035 --> 01:50:36,055
I'm going to ask you a question completely on a tangent finish.

1477
01:50:36,535 --> 01:50:38,915
Do you have a book that you would recommend anyone to read?

1478
01:50:39,135 --> 01:50:41,375
One that's like had a real impact on your life?

1479
01:50:41,535 --> 01:50:43,535
It doesn't, obviously not a Bitcoin book, just anything.

1480
01:50:44,835 --> 01:50:51,055
I think that if you have copious free time, you know, there are two histories.

1481
01:50:51,635 --> 01:50:56,255
Either read the story of civilization, which is Will Durant's history.

1482
01:50:56,475 --> 01:51:00,795
And it's like 11 volumes, maybe 12 to 15,000 pages.

1483
01:51:00,795 --> 01:51:03,955
start at the beginning, go to the end.

1484
01:51:04,915 --> 01:51:06,655
Might take you a few hundred hours.

1485
01:51:06,955 --> 01:51:09,715
You can listen to it in audio form or you can read it.

1486
01:51:10,195 --> 01:51:13,495
Read it if you can because there's a lot of graphic images in it.

1487
01:51:14,315 --> 01:51:22,935
I think that it's a balanced history of the world.

1488
01:51:24,475 --> 01:51:27,555
I used to think it's comprehensive and I realized, no,

1489
01:51:27,635 --> 01:51:29,615
it's a summary of the history of the world.

1490
01:51:29,615 --> 01:51:37,455
But compared to what you studied in school, you probably got the cliff notes and this was just a intellectually responsible summary.

1491
01:51:37,455 --> 01:51:46,635
and so I would do that because if you read if you read the history of the world you know

1492
01:51:46,635 --> 01:51:54,455
the Asian histories Middle East European histories American histories now you'll have

1493
01:51:54,455 --> 01:52:02,715
1,000 examples of civilizations rising and falling maybe 10,000 examples and you'll see

1494
01:52:02,715 --> 01:52:10,615
certain themes over and over again, but it will immunize you or inoculate you against falling for,

1495
01:52:11,035 --> 01:52:20,595
you know, the latest new idea du jour, you know, the new thing, you know, or faddishness. And I

1496
01:52:20,595 --> 01:52:26,795
think that's very helpful. It gives you wisdom. And I think for the Bitcoin community in specific,

1497
01:52:27,215 --> 01:52:32,635
I think it's also instructive to read Murray Rothbard's histories, right? Murray Rothbard,

1498
01:52:32,715 --> 01:52:38,415
a history of economic thought, right?

1499
01:52:39,215 --> 01:52:42,815
Or Conceived in Liberty, all of those volumes.

1500
01:52:43,455 --> 01:52:46,875
I think Rothbard wrote pretty comprehensive economic histories.

1501
01:52:47,415 --> 01:52:53,755
And he tells you the history of economic intervention, political intervention, monetary intervention.

1502
01:52:53,755 --> 01:53:05,435
And it's very helpful to read that because I think people are manipulated by the idea du jour and people are always –

1503
01:53:05,435 --> 01:53:05,795
Absolutely.

1504
01:53:06,195 --> 01:53:16,095
They're always constructing some bromide or some simplistic idea like, well, this represents this or this is the first time this has happened or this happened for the first time.

1505
01:53:16,095 --> 01:53:22,135
And they act like there's some righteous indignation.

1506
01:53:22,135 --> 01:53:29,235
Like, for example, 1971, we went off the gold standard.

1507
01:53:29,415 --> 01:53:30,835
Well, let me tell you a secret.

1508
01:53:32,175 --> 01:53:37,095
We went off the gold standard 10,000 times in the history of the world.

1509
01:53:37,555 --> 01:53:46,275
In fact, every single society in Russia, all 200 German principalities, they all went off the gold standard.

1510
01:53:46,275 --> 01:53:51,635
The example of currency debasement is as old as we have written history.

1511
01:53:52,135 --> 01:54:16,510
You know if you go back and you read Rothbard histories what fascinating is he points out that every 20 years or every 30 years in the Massachusetts Bay Colony from 1650 through the revolution some politician decided it was a good idea to print money and go fight a war and invade Canada And they would all issue a bunch of credit and then

1512
01:54:16,510 --> 01:54:22,790
they would go invade Canada. They would lose, come back. And the entire, then they would default on

1513
01:54:22,790 --> 01:54:29,970
their obligations and they had hyperinflation. And that was five times in one colony. And oftentimes

1514
01:54:29,970 --> 01:54:36,050
you'll read, people will say, you know, like America decided to invade Canada this one time.

1515
01:54:36,050 --> 01:54:43,170
It's like, no, actually. Or this was an example of the first time we debased the currency. Well,

1516
01:54:43,190 --> 01:54:48,930
in fact, every state debased the currency and the, you know, the colonial government during

1517
01:54:48,930 --> 01:54:55,710
the Revolutionary War. But it had happened 37 times before we even had a colonial government.

1518
01:54:55,710 --> 01:54:58,530
And then it happened how many dozens of times afterwards.

1519
01:54:59,650 --> 01:55:08,330
And so you see in these histories all these patterns, and they just echo over and over again.

1520
01:55:09,610 --> 01:55:15,530
You know, there's a bromide that circulates through the crypto community like, oh, yeah, the Reformation.

1521
01:55:15,970 --> 01:55:21,570
You know, that was the separation of church and state, and we're the separation of money and state.

1522
01:55:22,490 --> 01:55:25,390
The Reformation was not the separation of church and state.

1523
01:55:25,390 --> 01:55:40,130
If you actually study it close enough, what you realize is that Martin Luther was a monk that came up with the idea that maybe the German princes could just keep their money and steal all of the property from the Roman princes.

1524
01:55:40,950 --> 01:55:48,990
It's like what it represented was the combination of church with the state of Germany, with the northern German state.

1525
01:55:48,990 --> 01:55:55,510
and the German princes realized that if they were going to seize the property that the church held

1526
01:55:55,510 --> 01:56:02,270
in Germany, they needed God to endorse it. And so they needed God to speak German. And so they took

1527
01:56:02,270 --> 01:56:09,430
a German monk who created a Lutheran faith. They adopted the Lutheran faith. They excommunicated

1528
01:56:09,430 --> 01:56:14,770
the Roman Pope. And instead of one third of all the property in Germany being held by the Roman

1529
01:56:14,770 --> 01:56:21,470
Catholic Church. It was now held by the German Protestant Church. And instead of 10% of all the

1530
01:56:21,470 --> 01:56:28,790
money going as tithes to Rome, the 10% of the money terminated back in Germany. And so it was

1531
01:56:28,790 --> 01:56:36,390
literally just the use of a religious mechanism for political power to redirect economic power.

1532
01:56:37,130 --> 01:56:43,790
And there was never a separation of church and state. The church has always been aligned with

1533
01:56:43,790 --> 01:56:48,730
the state. It turns out that the French Catholic Church terminated with the King of France.

1534
01:56:48,990 --> 01:56:54,750
The Spanish Catholic Church terminated with the King of Spain. The Roman Catholic Church terminated

1535
01:56:54,750 --> 01:56:58,990
in Rome. There's a Venetian Catholic Church that terminated with the Doge of Venice.

1536
01:56:59,930 --> 01:57:05,010
And if you think that somehow the Protestant Reformation was a reformation, then explain how

1537
01:57:05,010 --> 01:57:10,810
come the Protestants in Switzerland became Calvinist? Because they wanted to terminate

1538
01:57:10,810 --> 01:57:17,150
all the money and all the power in Switzerland. And then the Protestants in Scotland, Presbyterians,

1539
01:57:17,310 --> 01:57:23,230
they wanted to terminate the money and the power in Scotland. And then the Protestants in the UK,

1540
01:57:23,490 --> 01:57:28,610
Anglicans, they wanted to terminate the money and the power with the King of England. And then you

1541
01:57:28,610 --> 01:57:32,430
had the Puritans and the Baptists and the Anabaptists. And you know what Southern Baptists

1542
01:57:32,430 --> 01:57:37,170
are? The Southern Baptists formed because there was a civil war and we couldn't very well have all

1543
01:57:37,170 --> 01:57:42,730
the money and the power terminate with a northerner. So we needed to split. And so you have

1544
01:57:42,730 --> 01:57:50,450
continual examples of a political struggle, which was also an economic struggle.

1545
01:57:51,550 --> 01:57:57,610
And people frame things as this is a religious fight. Well, it's a religious fight. I mean,

1546
01:57:57,610 --> 01:58:02,330
the whole term barbarian, we kill them because they were barbarians. They engaged in barbaric

1547
01:58:02,330 --> 01:58:05,790
activity. Barbarian just means I speak a different language. It's just I'm an other.

1548
01:58:06,610 --> 01:58:10,970
Okay, if I want to kill someone, it's convenient for me if they don't speak my language

1549
01:58:10,970 --> 01:58:14,670
because I can say that they're barbaric, and barbaric means they're Satan,

1550
01:58:14,850 --> 01:58:22,630
worshiping, child-sacrificing, you know, barbarians.

1551
01:58:23,330 --> 01:58:27,090
They're not there to defend themselves, and they can't because they don't know what I said

1552
01:58:27,090 --> 01:58:29,110
because they don't speak the language I just said it in.

1553
01:58:29,590 --> 01:58:31,830
And the joke is the Greeks came up with that idea.

1554
01:58:31,830 --> 01:58:38,110
So in essence, it gives you God's permission to murder someone that lives across the river and take their stuff.

1555
01:58:40,310 --> 01:58:53,110
And this entire idea, these things that echo through history, it's I'm combining religion with politics, with economics, with money.

1556
01:58:53,290 --> 01:58:58,350
And these are all justifications for me to accumulate power, seize power.

1557
01:58:58,350 --> 01:59:02,670
if I need to undo the power of a Roman pope,

1558
01:59:02,830 --> 01:59:06,110
I very well better create the Anglican church, right?

1559
01:59:07,050 --> 01:59:10,970
And say that God spoke directly to me, right?

1560
01:59:11,090 --> 01:59:15,410
And that kind of was the basis of the Lutheran idea,

1561
01:59:15,610 --> 01:59:19,130
which is God is German, God spoke to me,

1562
01:59:19,130 --> 01:59:24,110
and he told good Germans that the Roman Catholic, you know,

1563
01:59:24,310 --> 01:59:28,310
papist is not his spokesperson on earth anymore.

1564
01:59:28,350 --> 01:59:34,090
so i think when you see that you you see that every one of these things they're not new

1565
01:59:34,090 --> 01:59:43,890
1971 wasn't special will durant literally has a line he you know he's talking about a russian czar

1566
01:59:43,890 --> 01:59:50,130
16th century and he goes yeah you know the russian czar debased the currency and it all

1567
01:59:50,130 --> 01:59:55,970
became worthless and people discovered that the last thing in the world that you want to save is

1568
01:59:55,970 --> 02:00:01,950
money or whatever. It's like, and he's talking about something 500 years ago in a culture you've

1569
02:00:01,950 --> 02:00:06,390
never heard of. And it was like just the 19th time it had happened in the Russian culture.

1570
02:00:06,930 --> 02:00:17,070
So all of these things are echoing, right? And oftentimes, you know, one of the most

1571
02:00:17,070 --> 02:00:24,670
interesting insights that comes out of Rothbard's work and Conceived in Liberty is the colonies

1572
02:00:24,670 --> 02:00:30,110
before the Revolutionary War were decentralized. And the reason that you had any virtue at all

1573
02:00:30,110 --> 02:00:40,670
was because when the governor of New York dictated or when the governor of New York said,

1574
02:00:40,750 --> 02:00:44,470
you can't own property and you have no economic rights and you can't operate a business,

1575
02:00:44,930 --> 02:00:49,530
people could get in a canoe and cross the river and go to New Jersey or Pennsylvania where they

1576
02:00:49,530 --> 02:00:54,590
might have a chance. And when all of the, by the way, all the governors went insane. They were all

1577
02:00:54,590 --> 02:01:00,770
insane autocrats, but when all of the governors and all of the colonies had all these autocratic

1578
02:01:00,770 --> 02:01:05,870
rules like, oh yeah, it's illegal to bake bread or, you know, it's illegal to make a hat. There's

1579
02:01:05,870 --> 02:01:11,130
literally like the friend of the governor is the only guy that can make hats in New York. They had

1580
02:01:11,130 --> 02:01:20,290
the most insane communist, authoritarian, socialist rules. When they all went insane, you could just

1581
02:01:20,290 --> 02:01:28,070
sort of go west and your competition was a set of neolithic stone age tribes

1582
02:01:28,070 --> 02:01:36,030
and then you could do what you want and and um you get to bake bread and make your own hats

1583
02:01:36,030 --> 02:01:45,830
and you get to and now here's the big reveal which is we're taught in school that somehow

1584
02:01:45,830 --> 02:01:52,230
the Revolutionary War was the call in a standing up against tyranny and that the job wasn't done

1585
02:01:52,230 --> 02:01:57,990
until we formed the Constitution and created the United States. But what you really realize is

1586
02:01:57,990 --> 02:02:03,850
we probably were at the ideal point when there were just a bunch of colonies and there was no

1587
02:02:03,850 --> 02:02:10,910
United States because the United States was a power grab because a bunch of federalists and

1588
02:02:10,910 --> 02:02:16,290
centralized businessmen wanted to find a way to annex hundreds of thousands of acres in Ohio,

1589
02:02:16,290 --> 02:02:22,110
and they needed a federal government to give them title to the millions of acres west of the

1590
02:02:22,110 --> 02:02:27,070
colonies. And so they needed to go to the government. So we created a federal government.

1591
02:02:27,070 --> 02:02:31,350
They could actually buy a million acres, and they show up in the million acres and kick off all the

1592
02:02:31,350 --> 02:02:36,050
homesteaders and say, we have a title from the federal government of the United States. You owe

1593
02:02:36,050 --> 02:02:43,250
us taxes or we own your land. And so all of these political formations, they've always been about

1594
02:02:43,250 --> 02:02:51,110
balance of power and property rights and the denial of property rights. And what you think,

1595
02:02:51,870 --> 02:02:56,930
what you were taught, you know, that was the separation of church and state, is exactly the

1596
02:02:56,930 --> 02:03:02,610
opposite of what literally happened. And what you were taught was, oh, we formed the great nation,

1597
02:03:02,610 --> 02:03:09,150
And, you know, to preserve people's rights, it was exactly the opposite of what happened to a lot of people.

1598
02:03:09,230 --> 02:03:12,570
A lot of people lost their rights, you know.

1599
02:03:12,570 --> 02:03:19,610
And once you understand that, it'll keep you from being a simplistic idealist.

1600
02:03:19,830 --> 02:03:32,030
And you realize that there's a continual power struggle in nature, in life, in history, never ending, right?

1601
02:03:32,030 --> 02:03:39,790
Like everything in history, it's a continual never-ending power struggle over money, over power, over property.

1602
02:03:40,910 --> 02:03:50,870
And if I want to murder half of the nation and steal all their property, generally the best way to do it is say God said it was okay.

1603
02:03:51,870 --> 02:03:55,870
And so people go, well, you know, we've been mired in religious wars forever.

1604
02:03:56,030 --> 02:03:56,790
Isn't that a tragedy?

1605
02:03:58,050 --> 02:04:00,370
We created the religious differences.

1606
02:04:02,030 --> 02:04:09,710
to justify the war. And once you understand that the religious differences were inevitable

1607
02:04:09,710 --> 02:04:15,110
because they're all part of the power struggle between one party and another party, then I think

1608
02:04:15,110 --> 02:04:22,790
it helps you to understand why the world is the way it is and why these power struggles will continue.

1609
02:04:23,190 --> 02:04:26,510
All about money and power. Well, it sounds like I've got a couple hundred hours of reading to do

1610
02:04:26,510 --> 02:04:31,410
because I was not aware of any of that. But thank you so much, Michael. This has been great.

1611
02:04:32,030 --> 02:04:33,810
Hope to do it again at some point, but thank you.

1612
02:04:34,430 --> 02:04:35,590
Yeah, anytime.