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That's when hyperinflation really started.

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The inflation was really bad.

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Like right now, for example, Venezuela is running on average like 172 inflation year

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over year.

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That's normal for us.

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Like we...

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Insane.

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We bathe in that.

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And so that's normal.

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Now, at that point, it went from like 175, 200% to thousands of percent, millions of

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percent.

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It was incalculable.

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If you think like fiat is bad in America, boy, let me tell you about other fiat.

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This idea of shorting the dollar with Bitcoin felt almost like a no brainer.

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But at the same time, this concept of shorting the dollar as a foreigner, it's like, whoa,

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like, are you really like, you know, but because you're like, oh, my God, but hold on.

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That's the one that works.

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Like, wait, wait, wait.

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But then you start basically understanding more of it.

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And you're like, wait a second, but it works just like all the others.

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Like, it's not different at all.

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It's just has these other privileges, but it actually breaks just as easy.

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And then you see you see Bitcoin price the dollars.

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You see the price that it's doing immediately.

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The graph tells you, why am I selling this thing when I can borrow the dollars from it?

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So I think in the context of how divisive everything is getting, I think we as Bitcoiners need to keep a sort of centrist approach to things and understand that Bitcoin is going to outlast this administration and the next administration and the next one and the next one and the next one.

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And so we should try to build this as anti-fragile as a sort of administration proof as we possibly can.

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Our view is that if Bitcoin does what we believe it's going to do, what else do you need?

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Greetings and salutations, my fellow plebs. My name is Walker and this is The Bitcoin Podcast.

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Bitcoin continues to create new blocks every 10 minutes. The value of one Bitcoin is still

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one Bitcoin. And if you're listening to this right now, remember, you are still early.

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If you're not already, go ahead and subscribe to this show wherever you're watching or listening

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and share it with your friends, family and strangers on the internet. If you want to

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Follow me in the show on Noster and X.

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Just head to the show notes to grab the links.

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00:02:00,000 --> 00:02:04,460
If you're enjoying The Bitcoin Podcast and want to support it by becoming a paid subscriber,

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00:02:04,640 --> 00:02:08,220
you can download the Fountain app, search for The Bitcoin Podcast,

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00:02:08,760 --> 00:02:12,980
and subscribe by paying with Bitcoin via lightning or fiat via card.

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You'll get access to ad-free episodes and early releases of select content.

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Plus, you'll help support this show.

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Head to the show notes for product discount links.

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Go to walkeramerica.substack.com to get episodes emailed to you and head to bitcoinpodcast.net

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for everything else.

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Without further ado, let's get into this Bitcoin talk.

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Marisa, welcome.

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We were just talking backstage, let's say, and it was getting far too interesting and

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we needed to start recording.

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So how are you?

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Again, good to see you, man.

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Stoked to have you on the show.

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Thank you for having me, man.

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I'm a big fan of you and Carla.

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I've been following you guys for a long time, and I love your content.

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I'm excited to be talking to Toximus Maximus and other characters.

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But no, man, I love what you guys do for the space.

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I think the mix of education and fun is very, very needed.

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And I get a real kick out of your videos.

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So congrats.

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Much appreciated, man.

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I mean, we need more fun in the Bitcoin space.

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We can't start taking ourselves too seriously.

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I think it would be a massive mistake.

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You need to be able to laugh.

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Laugh at the fiat world, but then also laugh at yourself in the Bitcoin world.

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Like, that's one of the key things.

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Laugh at yourself before anyone else can.

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Take away their power.

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I completely agree.

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And that's why I'm actually a big fan of guys like you and Tatum, like people that do actual humor on Bitcoin.

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I think that's a very – I wish there was more.

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And, you know, hopefully you guys continue to grow and become the new Colbert's or the new, you know, the new smart slash funny people, the new Bill Maher's or whatever it is that we're going to have in our generation.

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But yeah, this taking Colbert's without the vaccine propaganda.

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Him and Stewart used to be actually really great until they went crazy.

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But I remember in the early days, I was a Colbert fan and I was a Jon Stewart fan.

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And I would listen to them.

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I thought they were funny, clever.

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Then all of a sudden they went real political.

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And then it just started going off the rails.

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It's funny when you're willing to pick on both sides equally.

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It's not funny when all of a sudden it becomes clear that you're a political operative.

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Maybe you were the whole time and you were just better at hiding it.

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But I think there were some weird vibe shifts that happened.

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And I feel like Trump really kind of broke a lot of people's brains in that, especially that first election where it was like people felt like, well, I just, I have to, you know, be on this side because I'm fighting for, you know, for democracy and everyone else is evil.

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And like it, it really messed people up, man.

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And then COVID just messed people up even more.

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Like, I don't know.

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A lot of people, I feel like we'll never recover from that.

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You know, it's funny because I find so many parallels to what I'm seeing in the West versus what we experience in Venezuela.

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Like in Venezuela, when Chavez won, it started out as incredibly divisive, right?

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Like he basically took one side of the country and said, your neighbors are your enemies.

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And basically the second you start pointing fingers at your neighbors and you start seeing them as the enemy or contenders rather than your partner, it basically creates, it breaks up society into two camps.

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Like you're either, you know, you're red or you're blue or you're red or you're white or whatever the two colors are.

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And then that starts priming so much more of your everyday.

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And it ends up that we end up picking people that are even more and more polarized on either side because everybody wants to get revenge from the previous term.

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And eventually that all goes well until the pendulum stops swinging at either end, right?

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Because then as long as the pendulum is swinging, it can be divisive, it can be uniting, but the pendulum is swinging and you're giving everyone their shot.

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Eventually, the pendulum stops swinging because the democratic entities get crippled by one or the other.

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And then that's when the country just goes array because one group completely takes over and chases the other group out.

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I mean, I'm not one that to be the end for everything or how everything plays out, but that's what I saw.

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And so I'm starting to see a lot more of that them versus us type of rhetoric.

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And it's not great.

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For all the great that this administration is doing for Bitcoin, I wish it was not as pinned to one camp as it is today.

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Because you know the other guys aren't sitting there saying, oh, this is so great.

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They're probably keeping tabs.

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And so that's not good for us.

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That's not good for Bitcoin.

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You know, we really want this to be, we don't want the next group to go take down the sandcastle, this group build, and then so on and so forth.

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So I think in the context of how divisive everything is getting, I think we as Bitcoiners need to keep a sort of centrist approach to things and understand that Bitcoin is going to outlast this administration and the next administration and the next one and the next one and the next one.

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And so we should try to build this as anti-fragile as a sort of administration proof as we possibly can.

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And so I think it's important not to lose sight of that because it wasn't too long ago when we were under the foot of Chokepoint, right?

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And a lot of us still remember what that felt like.

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And being in this, it feels a bit of like a dream, right?

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Like everything is sort of, you know, we have all these tailwinds, but we forget how quickly that changed.

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And I don't want it to go back to where it was, right?

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Like I want this to continue being the wind behind everyone's sails, regardless of your color.

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So I think we have, you know, we have our work cut out for us to keep that balance.

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The best part about Bitcoin is it doesn't care if you're Donald Trump, a humble pleb, a company or a country.

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We all get the same rules.

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And one of the rules is he who controls the private keys controls the coins.

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So keep your coins safe by going to bitbox.swiss slash walker and using the promo code walker for 5% off the fully open source Bitcoin only Bitbox O2 hardware wallet.

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Then get your Bitcoin off the exchange and into your own self custody.

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Bitcoin is ripping. Companies are buying. Nation states are buying. Plebs are buying.

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And your stack will soon be worth a heck of a lot more in fiat value than it is today.

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So now is the perfect time to make sure you have your security locked down tight with Bitbox.

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Plus, and I can't emphasize this enough, the Bitbox O2 is truly easy as hell to use.

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Whether you're brand new to Bitcoin, it's your first time using a hardware wallet, or you are a well-seasoned psychopath.

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Again, it's Bitcoin only and fully open source.

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Head to their GitHub and verify that for yourself. No need to trust me.

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When you go to bitbox.swiss slash walker and use the promo code walker, not only do you get 5% off,

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but you also help support this podcast.

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So thank you.

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It's true.

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And I think it's, my hope is that folks on,

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like Bitcoin doesn't care about your politics, right?

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Bitcoin's code, right?

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It doesn't care.

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You know, Bitcoin cannot keep you from using it.

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You can only, you know,

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you can only cut yourself off from Bitcoin

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or your constituents.

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If you're a politician who like Elizabeth Warren

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has consistently been so anti-Bitcoin

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that, you know, anybody who listens to her

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and listens to her honestly

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and thinks she's somehow actually a good faith actor,

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she's hurting them.

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She's hurting them by perhaps scaring people off of Bitcoin

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that would otherwise be interested.

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And I think it would be such a mistake for the Democrats

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to make this into a Trump thing.

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And that's, we were talking before this,

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we were both in DC for the Bitcoin Policy Summit.

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And that was one of the things that I heard.

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I live in Illinois and basically Illinois is a very blue state.

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It's a Pepsi-Cola state, not a Coca-Cola state, right?

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in our little duopoly democracy.

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And every staffer and even the senators

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that we were lucky enough to talk to,

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they basically, it's like Bitcoin is Trump coin,

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is crypto, is Sam Bankman-Fried,

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and even though they took money from Sam Bankman-Fried,

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forget about that.

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It's all lumped together.

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And so it's like education is such an important piece here.

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This is why we always need more Bitcoin podcasts, right?

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I've got to saturate the market, get the education out there.

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But it's sad to see.

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It's sad because I've heard a similar story from my in-laws, for example, who were in communist Romania and say, look, we see some of the same markers here in the West that we saw in communism.

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You're saying this like, look, I grew up in Venezuela.

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I'm seeing some of the same writing on the wall that we saw there.

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Like that's such a sad thing for me.

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I was privileged enough to be born in the United States of America.

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I still think America is the greatest country in the world because of the ideas and the foundation that we have here and the people that it attracts.

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But, man, it's sad to see that like that pendulum swings back hard and it's kind of a constant thing.

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I'm curious, too, you know, I would love to actually dig into a little bit because I think I told you this before we got on.

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But you have, I think, one of the most interesting kind of Bitcoin origin stories that I've heard.

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And it's really powerful.

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You've spoken about this at conferences multiple times about how you found Bitcoin and what that really meant for you and your family, not just in some theoretical way, but in very real in terms of survival.

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can you walk through that story a little bit because i i think it's really important for

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people to hear stories like this no thanks man i appreciate it um i'll try to keep it concise

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because i can wax poetic on this um it's um so as i mentioned i'm from venezuela that's where i was

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born and raised and anyone that's kind of followed the venezuela story or the journey uh you know

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25 years ago we were this beautiful country with amazing beaches most beautiful women in the world

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statistically, not because I'm from there.

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You're not biased, yeah.

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No, I'm not.

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But we had ample resources, the biggest oil reserves in the world.

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Mind you, it's hard to refine crude, but on the numbers, just on the pure numbers, absolute

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terms, Venezuela has the biggest reserves of oil out there.

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And the country had the opportunity to become Latam's Dubai.

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You know, growing up when my dad was sort of getting his start in his professional life, you know, in the 70s, etc.

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Venezuela was a booming country in the 80s.

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It was a booming country.

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Now, the problem with commodity heavy countries like Venezuela, like Nigeria, like any other, is that you have this, your economy dances to the beat of that resource.

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And so the success of your economy is very, in many ways, disconnected from your political actions.

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And so it creates this noisy feedback loop where if a great administration was there, but it had a crappy time in the oil markets, that administration could have done a lot of great things.

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But it wouldn't be reflected in the economy because the prices of oil were depressed.

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And so Venezuela had these wild swings in the late 80s, mid to late 80s, and even throughout the 90s in oil prices.

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Like oil would just boom and bust and boom and bust.

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And that created a lot of, I would say, economic instability in the country.

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People were frustrated.

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People were upset every time it boomed and it busted.

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And so there was some political discontent in Venezuela.

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And Venezuela for many years was a very similar structure to the U.S. where there was like two parties, you know, blue and orange.

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And they were both they were all predominantly, you know, European background white males that just kind of handed the baton to each other.

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And that was all going well until the economy started.

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There started being economic frustration around the country.

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And then that started the first of a attempts of overthrowing the president.

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So many people don't know this, but Chavez, the way Chavez became famous is because he used to be a member of the Venezuelan military.

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And he was the guy that led the first coup attempt.

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And he failed.

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And he was jailed, then released.

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Tried to overthrow the government again a second time.

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Failed.

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Got put back in jail.

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But throughout this time, throughout these years, those two events were like two years from each other.

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and then basically as he was in jail he was still getting a lot of support because the economy wasn't

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humming along there was still a lot of discontent and people kept kept you know there was this this

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um idea that we needed chavez to actually succeed right like we needed someone to overthrow the

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government and so he struck a deal with the then president rafael caldera and basically said you

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either, I'm either going to give the green light and fly the planes and try to overthrow

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you again from in here, or you can release me and we can go toe to toe in the polls.

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And Caldera basically said, I'll release you.

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And so he released Chavez.

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Chavez gets on a plane.

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First thing he does is he goes to Cuba, goes to Havana to get his training from the Cuban

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G2.

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By the way, people don't really say this, but the Cuban intelligence service is actually

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pretty sophisticated.

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It's insanely sophisticated.

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And so Chavez comes back, runs this sort of centrist campaign, saying all the right things, wins the election, and immediately starts his thing to rewrite the Constitution.

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Many families that kind of saw what he was and who he really was basically saw the writing on the wall and said,

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OK, we're going to go spend four years abroad while this wave passes because he's just not going to last.

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We're just going to come back and it's going to be great.

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And that was part of my family.

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My family did that.

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I spent two years in Florida.

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And I remember when I got to Florida and I met Cubans who were in Florida.

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And we told them what was happening in Venezuela.

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We're like, oh, we're just here for a few years.

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I'm going to come back.

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And they would come and they would give me this hug, this very somber hug.

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And they would say, yeah, we thought so too.

244
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We thought we were going to go back.

245
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But I don't think you guys know what just happened in your country.

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It's like you better be comfortable here.

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and uh and we remember laughing it off being like no you guys are an island come on like that's not

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gonna happen to us we're mainland we got oil don't worry about it he's just gonna go away we're gonna

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get it back and um very ominous actually their their view they they knew exactly what was happening

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anyway long story short chavez uh basically rewrites the constitution gives himself

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indefinite re-election powers, extends the presidential term to a year, changes the name

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of the country, changes the flag, changes the coat of arms, changes the time zone, funny enough.

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And so as if that wasn't enough of a tell that this is what was coming, you know, my family,

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after a few years in Florida, we decided to go back because it was very difficult to spend

255
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dollars and earn boliones, you know, right? Like it's, my dad's businesses were still running back

256
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home and internet wasn't as great as it is there was no remote infrastructure he was just getting

257
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hosed by the people he left and so we had to go back but after we went back my parents sole mission

258
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was to get the kids back out of the country right like graduate get out graduate get out so i

259
00:18:14,060 --> 00:18:19,960
graduated i went to do my university in canada my brother my middle brother did his university

260
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in venezuela but he actually left right after to go to europe but my youngest brother didn't want

261
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to leave and um and he graduated right after chavez died so chavez died in 2013 and that was

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the time we thought okay many many venezuelans as as authoritarianism progresses you keep creating

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these hopes that that this is what this is it's going to end in this time and no no that didn't

264
00:18:44,300 --> 00:18:49,520
have nobody just gonna end when this happens it's for sure gonna end right so we had about six or

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00:18:49,520 --> 00:18:55,860
seven rigged elections you know under chavez and but everybody had this idea that when chavez died

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you know the head of the monster was going to be taken off and there was just going to be disarray

267
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within the ranks and along comes freedom again and we rebuild um so many people uh invested in

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flying down in and basically moving preparing to move back to the country i did that i shipped the

269
00:19:14,640 --> 00:19:20,000
container with all my belongings from Canada to Venezuela. I got on the plane and went to vote with

270
00:19:20,000 --> 00:19:27,260
my wife. And, you know, the election was rigged. Obviously, the results came out late that night.

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Maduro wins. No, you didn't. Let's do a recount. We're not going to do a recount. You know, do a

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00:19:32,720 --> 00:19:38,660
recount or what? And so they're basically and then, you know, that that triggered a series of

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protests to basically put down the protests. The government responded with real bullets

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and started actually shooting down protesters. And at that point, my family basically says,

275
00:19:52,140 --> 00:19:56,300
listen, we didn't win. Get out. I don't care that you shipped all your stuff here. I don't care that

276
00:19:56,300 --> 00:20:00,180
you have a house here. I don't care that you have things here. Just get out. And so I left,

277
00:20:00,420 --> 00:20:03,700
and my middle brother left. But my youngest brother didn't want to leave, even with this

278
00:20:03,700 --> 00:20:09,840
happening. And keep in mind, when Chavez dies, and this other guy steals the country, Maduro,

279
00:20:10,640 --> 00:20:16,200
that's when hyperinflation really started. The inflation was really bad. Like right now,

280
00:20:16,260 --> 00:20:20,380
for example, Venezuela is running on average, like 172 inflation year over year. That's

281
00:20:20,380 --> 00:20:23,220
normal for us. Like we... Insane.

282
00:20:23,640 --> 00:20:31,160
We bathe in that. And so that's normal. Now, at that point, it went from like 175, 200% to

283
00:20:31,160 --> 00:20:33,940
thousands of percent, millions of percent.

284
00:20:34,040 --> 00:20:38,860
It was incalculable because there was no official exchange.

285
00:20:38,980 --> 00:20:42,140
There was the official exchange rate, and then there was the real exchange rate.

286
00:20:42,640 --> 00:20:48,400
But every data aggregator that tried to show a history of the real exchange rate,

287
00:20:48,500 --> 00:20:50,480
not the government fix, got taken down by the government.

288
00:20:50,900 --> 00:20:54,280
So there was no clear history of how they –

289
00:20:54,280 --> 00:20:56,860
because they just wanted to shut down your ability to see.

290
00:20:56,860 --> 00:21:02,780
and by the way the venezuela central bank stopped issuing data i don't know five years ago six years

291
00:21:02,780 --> 00:21:06,600
ago like there's no like this idea that america has where like your central bank comes out and

292
00:21:06,600 --> 00:21:10,980
gives you these numbers and you're like oh great like that doesn't exist in in a lot of places

293
00:21:10,980 --> 00:21:17,740
um so if you think like fiat is bad in america oh boy let me tell you about other fiat um

294
00:21:17,740 --> 00:21:24,220
so um as this was happening my parents were like please mario my youngest person's like please

295
00:21:24,220 --> 00:21:28,580
leave like please just just get out and he's like i don't i don't want to leave i refuse

296
00:21:28,580 --> 00:21:34,880
and he pitches my dad on all these ideas to start a business and my family i've told this story a few

297
00:21:34,880 --> 00:21:38,680
times like my family is very entrepreneurial my dad always wanted to support us out of school to

298
00:21:38,680 --> 00:21:44,860
try something on our own and so my brother's turn came up and everything was just terrible ideas

299
00:21:44,860 --> 00:21:49,780
because everything involved staying in venezuela and then eventually a few months after this process

300
00:21:49,780 --> 00:21:54,840
started, he comes to my dad with an ultimatum. And he says, I'm doing this from leaving the house.

301
00:21:55,300 --> 00:21:59,400
And my dad basically gets a little nervous. He's like, I think he's serious about this. He sends

302
00:21:59,400 --> 00:22:05,180
me his pitch, forwards me the email. It's basically the white paper and a link to Bitmain.

303
00:22:05,380 --> 00:22:09,520
He wanted to buy Bitcoin miners to mine in Venezuela. So that was the first time I read

304
00:22:09,520 --> 00:22:16,780
the white paper and I've heard about Bitcoin. And all I understood from that pitch was that

305
00:22:16,780 --> 00:22:21,660
he wanted to buy computers that took in energy and took in internet both were subsidized in

306
00:22:21,660 --> 00:22:26,060
Venezuela to a large extent and the output was this asset that you could sell in an international

307
00:22:26,060 --> 00:22:32,400
market at fair prices on you know untouchable and uncontrollable from the Venezuelan regime

308
00:22:32,400 --> 00:22:38,140
so I was like oh this out of everything he's proposed this sounds like it'd be kind of

309
00:22:38,140 --> 00:22:47,940
sheltered from this mess. And so he starts doing that. And this is 2015, early 2015. And so I went

310
00:22:47,940 --> 00:22:53,540
down later that year, when all my friends were desperately leaving the country, selling their

311
00:22:53,540 --> 00:22:58,160
houses, selling their cars, trying to figure out where they could go live with their passports,

312
00:22:58,300 --> 00:23:05,040
where they'll be allowed to go live, get a work permit. And my brother greets me as I fly down.

313
00:23:05,040 --> 00:23:08,320
He's the only guy noticeably with a smile.

314
00:23:08,320 --> 00:23:10,640
Everyone else was just like faces were long.

315
00:23:10,640 --> 00:23:11,740
My brother was like happy.

316
00:23:11,740 --> 00:23:23,748
And he comes to me and he says I heard your friends are leaving And I like yes as are everyone else And he like if they have any industrial sites that they leaving behind that they would be

317
00:23:23,748 --> 00:23:27,928
liking, that they would like to rent, I'm really looking for more space, right? And I'm like,

318
00:23:28,508 --> 00:23:34,828
that was the first sort of what's, this isn't normal. And so he's like, come see my facility.

319
00:23:34,948 --> 00:23:39,128
I go see his facility. He had about twice the machines he had initially proposed to my dad.

320
00:23:39,468 --> 00:23:40,148
I didn't say anything.

321
00:23:40,268 --> 00:23:41,068
And then I go to my dad.

322
00:23:41,148 --> 00:23:43,648
I'm like, dad, I thought we said it was going to be five machines.

323
00:23:43,728 --> 00:23:45,708
I saw more than 10.

324
00:23:45,828 --> 00:23:46,948
He's like, oh, no, no, those are his.

325
00:23:47,368 --> 00:23:48,788
He paid me back the initial five.

326
00:23:49,948 --> 00:23:51,088
And I go back to my brother.

327
00:23:51,208 --> 00:23:53,568
And I'm like, how are you doing this?

328
00:23:53,648 --> 00:23:54,728
And he says, I'm mining Bitcoin.

329
00:23:55,948 --> 00:23:57,508
And I said, show me.

330
00:23:57,828 --> 00:23:59,468
So he's like, give me your bank account.

331
00:23:59,768 --> 00:24:03,208
And he basically said, this is what the dollar costs in the real market.

332
00:24:03,408 --> 00:24:05,028
This is what Bitcoin costs in dollars.

333
00:24:05,208 --> 00:24:07,368
I'm going to sell this much Bitcoin, which is going to be $100.

334
00:24:07,368 --> 00:24:11,068
and I'm going to get the fair market value of dollars to Bolivares

335
00:24:11,068 --> 00:24:13,368
and I'm going to get your Bolivares into your bank account.

336
00:24:14,088 --> 00:24:16,848
And I was like, okay, go ahead, buddy.

337
00:24:17,328 --> 00:24:19,368
And so he does it.

338
00:24:19,468 --> 00:24:21,468
He basically, it was like $100 worth of Bitcoin,

339
00:24:21,648 --> 00:24:26,128
converted it to the real black market or real market Bolivares, right?

340
00:24:26,168 --> 00:24:27,848
The true value of a dollar.

341
00:24:28,068 --> 00:24:29,788
And then those dollars were sent to my bank account.

342
00:24:30,908 --> 00:24:36,008
And at that point is when all the light bulbs came off

343
00:24:36,008 --> 00:24:51,548
Because what came after this is in hyperinflation, the way what it feels like, like what hyperinflation really, the experience of hyperinflation for most humans is you get paid on Friday.

344
00:24:52,408 --> 00:24:57,548
And that payment that you're getting is $100 at 4 p.m. the day you got it.

345
00:24:57,908 --> 00:25:00,588
If you sell it at 5, you might get $80.

346
00:25:01,048 --> 00:25:02,628
You might get $80.

347
00:25:03,068 --> 00:25:06,068
If you sell it on Saturday, you might get 60.

348
00:25:06,428 --> 00:25:08,028
If you sell it on Sunday, you get 40.

349
00:25:08,068 --> 00:25:09,868
If you sell it on Monday, you probably get 20.

350
00:25:11,468 --> 00:25:16,548
And what happens in these environments is that nobody wants to get rid of their dollars

351
00:25:16,548 --> 00:25:20,308
or they don't want to get rid of their dollars in any way, shape, or form.

352
00:25:20,468 --> 00:25:25,128
So it becomes really hard to convince somebody to trade you the dollars.

353
00:25:25,228 --> 00:25:26,568
Now, let's just say you got there.

354
00:25:26,568 --> 00:25:28,188
Let's just say you got the Bolivarist.

355
00:25:28,188 --> 00:25:34,608
and now let's just say it's $150, like $150 worth, you have two options.

356
00:25:35,108 --> 00:25:39,488
You can either go to somebody and try to trade cash for cash.

357
00:25:39,668 --> 00:25:41,908
So you're giving them, Bolivar is in cash, they'll give you $150.

358
00:25:43,128 --> 00:25:49,768
That cash, that U.S. cash that you get is a liability in the sense that if you get pulled over any checkpoint

359
00:25:49,768 --> 00:25:55,808
and they see those dollars on you and they ask you for the official government receipt on how you got them

360
00:25:55,808 --> 00:25:58,648
and you can't provide it, it's gone.

361
00:25:59,108 --> 00:26:00,008
Your dollars are gone.

362
00:26:00,828 --> 00:26:04,508
What happens is the wealthy who have been able to go to Florida

363
00:26:04,508 --> 00:26:07,608
and open a Wells Fargo bank account or a Bank of America bank account,

364
00:26:07,788 --> 00:26:11,348
they get to get dollars deposited into their Wells Fargo bank account

365
00:26:11,348 --> 00:26:14,348
and they just wire dollars in a local bank account here.

366
00:26:14,828 --> 00:26:19,288
So that excludes 99% of the population from that trade.

367
00:26:19,608 --> 00:26:22,168
99% of the population are forced to hold cash,

368
00:26:22,528 --> 00:26:24,788
which A, has the risk of getting confiscated,

369
00:26:24,788 --> 00:26:27,528
but B has the risk of being fake.

370
00:26:28,128 --> 00:26:28,788
And so in Venezuela,

371
00:26:28,988 --> 00:26:30,328
many people would walk around

372
00:26:30,328 --> 00:26:31,568
with their little pens

373
00:26:31,568 --> 00:26:33,628
and even lamps.

374
00:26:33,728 --> 00:26:35,228
Like people would whip out lamps

375
00:26:35,228 --> 00:26:35,848
from their pockets

376
00:26:35,848 --> 00:26:37,108
just to look at dollars

377
00:26:37,108 --> 00:26:38,528
as they were making transactions.

378
00:26:38,768 --> 00:26:39,448
Even stores,

379
00:26:39,568 --> 00:26:40,988
anywhere you wanted to go pay with a dollar,

380
00:26:41,108 --> 00:26:42,968
they would have like pens and the things.

381
00:26:43,308 --> 00:26:43,648
And if you want,

382
00:26:43,728 --> 00:26:44,708
God forbid you wanted to pay

383
00:26:44,708 --> 00:26:45,648
with a $100 bill,

384
00:26:45,688 --> 00:26:46,688
they would bring down the manager.

385
00:26:47,288 --> 00:26:50,208
Like the manager would have to get involved

386
00:26:50,208 --> 00:26:53,148
to basically assess the realness

387
00:26:53,148 --> 00:26:54,228
of this $100 bill.

388
00:26:54,788 --> 00:26:59,908
So what ends up, the way Bitcoin started going viral in Venezuela, beyond the mining,

389
00:27:00,068 --> 00:27:03,728
mining was like the side of the house that I was most exposed to.

390
00:27:03,908 --> 00:27:10,688
But on the other side of that mining activity was the demand from people trying to get rid of their bolivares.

391
00:27:10,868 --> 00:27:14,068
And so the way this would happen would be you could pay it on a Friday,

392
00:27:14,368 --> 00:27:18,968
and there's no bank that you can go trade those bolivares for dollars.

393
00:27:19,088 --> 00:27:22,548
The bank has an order not to sell them to you, the central bank.

394
00:27:22,548 --> 00:27:25,508
No regulated financial entity can sell you those dollars.

395
00:27:26,088 --> 00:27:28,728
So what happens is you start going P2P.

396
00:27:29,248 --> 00:27:36,268
So you start calling your buddy, Miguel, Maria, whoever you know is in the sort of dollar buying and selling brokerage business.

397
00:27:36,768 --> 00:27:38,868
And so you say, Miguel, I need $150.

398
00:27:39,788 --> 00:27:40,488
You got him?

399
00:27:41,168 --> 00:27:45,208
And he goes, oh, I might have some on Wells Fargo.

400
00:27:45,248 --> 00:27:45,948
Do you have Wells Fargo?

401
00:27:46,708 --> 00:27:48,428
No, I don't have a Wells Fargo account.

402
00:27:48,528 --> 00:27:49,308
Okay, sorry, man.

403
00:27:49,508 --> 00:27:50,448
No dollars here.

404
00:27:50,448 --> 00:27:55,168
and so you can keep going down the list okay i'll call maria maria would tell you the same thing no

405
00:27:55,168 --> 00:28:00,468
no dollars sorry sorry miguel no dollars and so you would say and then by the fourth person you'd

406
00:28:00,468 --> 00:28:06,008
be like i need to get rid of these bolivarists like by now i've already lost 20 of my week's work

407
00:28:06,008 --> 00:28:09,588
and the guy the guy on the other side of the phone would tell you something like

408
00:28:09,588 --> 00:28:15,668
okay so you don't have a wells fargo bank account and i don't have cash but there's this thing that

409
00:28:15,668 --> 00:28:20,968
I can sell you. It's called Bitcoin. And you can hold it and trade it out for dollars in an exchange

410
00:28:20,968 --> 00:28:26,768
outside of Venezuela. And people were saying, what is it? What do I need to do? It's online

411
00:28:26,768 --> 00:28:31,588
money, man. You can buy it or you can not buy it. What do you want to do? And you would say,

412
00:28:31,688 --> 00:28:37,328
what do I need? And they'll say, go to this website, give me an address, give me the money,

413
00:28:37,328 --> 00:28:44,688
and I'll send you the Bitcoin. And people were nervous to the nth degree, but the risk of not

414
00:28:44,688 --> 00:28:50,948
doing it is you lose your whole week's work. So you say, fine, I'll give you this thing. Okay,

415
00:28:50,948 --> 00:28:56,088
I'll give you this address. I'll give you these dollars. Fine. Here's $150. Send me $150 to this

416
00:28:56,088 --> 00:29:00,928
thing. So they would land in your exchange or whatever, or your wallet. And at some point,

417
00:29:00,948 --> 00:29:05,968
it would show you how much Bitcoin and the dollar value of the Bitcoin. You did that on Friday.

418
00:29:07,428 --> 00:29:11,708
Tuesday rolls around. And you're like, okay, now I'm going to go from Bitcoin to dollars,

419
00:29:11,708 --> 00:29:13,468
which is what I wanted in the first place.

420
00:29:14,128 --> 00:29:15,688
So you log into this thing

421
00:29:15,688 --> 00:29:17,948
and you see that the $150 you bought

422
00:29:17,948 --> 00:29:19,368
is now worth $160.

423
00:29:21,248 --> 00:29:24,168
Instantly, you're like, what?

424
00:29:25,448 --> 00:29:28,148
Venezuelans and many people outside of the OECD countries

425
00:29:28,148 --> 00:29:31,168
have never seen an investment go up in dollar terms.

426
00:29:31,568 --> 00:29:33,348
I know this sounds crazy to some people,

427
00:29:33,848 --> 00:29:35,688
but to most of the world,

428
00:29:36,128 --> 00:29:39,308
having a fixed dollar amount that just stays there,

429
00:29:39,308 --> 00:29:41,288
it doesn't change, just sits there,

430
00:29:41,708 --> 00:29:45,108
It's the panacea of their investment, right?

431
00:29:45,108 --> 00:29:48,168
Because to them, to most people, the dollar doesn't devalue, right?

432
00:29:48,228 --> 00:29:55,648
Like it devalues so slowly compared to their currency that they feel like they're, you know, a dollar is Fort Knox, okay?

433
00:29:55,928 --> 00:30:01,408
And so they go into this exchange account and they see not 150, but 160.

434
00:30:02,628 --> 00:30:05,488
That is a day's worth of work for them.

435
00:30:06,328 --> 00:30:09,368
So they turn around and they go and they say, wait, wait a second.

436
00:30:09,608 --> 00:30:11,388
I thought you sent me 150.

437
00:30:11,708 --> 00:30:17,688
it's like no i did but it's 160 on my screen it's like yeah i know bitcoin goes up in price

438
00:30:17,688 --> 00:30:23,228
in dollar price and then all of a sudden you realize that you don't just have a dollar

439
00:30:23,228 --> 00:30:26,648
you have a thing that appreciates in dollars

440
00:30:26,648 --> 00:30:36,248
mind-blowing just mind-blowing and so then you're like this thing made more money in one day by not

441
00:30:36,248 --> 00:30:43,288
selling it than I did at my job. Why would I sell it? How can I get more of this? And they're like,

442
00:30:43,308 --> 00:30:49,348
well, you can buy it. But did you know that so-and-so is mining it? Mining it. What do you

443
00:30:49,348 --> 00:30:54,808
mean mining it? Yeah, just use an old computer, connect it into NiceHash. NiceHash will turn your

444
00:30:54,808 --> 00:31:00,588
GPU proceeds into Bitcoin and off you go. Do it with every old computer you have. And so everybody

445
00:31:00,588 --> 00:31:04,848
starts going wild in mining and buying Bitcoin and holding Bitcoin because they've never seen,

446
00:31:04,848 --> 00:31:09,388
at this point, there's no stable coins, by the way. Stable coins do not exist. They're not popular.

447
00:31:09,668 --> 00:31:18,028
No one talks about them. It's Bitcoin or dollars. And Bitcoin just surfaces as the absolute best

448
00:31:18,028 --> 00:31:25,188
option. And so Bitcoin starts going viral. All along this time, this is 2015, 2016, early 2017,

449
00:31:25,828 --> 00:31:30,068
right? Throughout this time, our family's minds are growing. People are coming to us,

450
00:31:30,068 --> 00:31:35,128
asking us how do you do this we're helping basically dozens of people set up new mines

451
00:31:35,128 --> 00:31:39,088
and import the things from bitmain and do the electrical upgrades this is like the venezuelan

452
00:31:39,088 --> 00:31:42,588
golden age of bitcoin like i still get goosebumps when i think about it it was epic everybody was

453
00:31:42,588 --> 00:31:48,188
like you found it like you found freedom show me mao show me it was like show me elio my dad is

454
00:31:48,188 --> 00:31:55,828
elio and my dad was like the bitcoin guy okay in in the town and so anyway people like my family

455
00:31:55,828 --> 00:32:00,388
starts mining my friends start mining everybody has basically got a rig and you know holds a

456
00:32:00,388 --> 00:32:09,088
little bit of bitcoin then the shitcoin era starts emerging like ico boom and that gives rise to

457
00:32:09,088 --> 00:32:17,028
eth and a bunch of other um new alternative assets and you know i could go on for another

458
00:32:17,028 --> 00:32:24,848
half hour but to keep it to keep it super short i love it man um so then maduro um maduro like

459
00:32:24,848 --> 00:32:30,888
after Chavez, Maduro is coming under a lot of heat because there's a lot of societal upheaval.

460
00:32:31,588 --> 00:32:36,008
And to kind of keep this in check, he has to do some pretty nasty things. Like he has to actually

461
00:32:36,008 --> 00:32:42,168
go shoot people. Like his people have to go like literally shoot people, jail innocent people,

462
00:32:42,428 --> 00:32:48,448
prosecute, make examples out of people. And obviously these cronies demand their pound of

463
00:32:48,448 --> 00:32:55,508
flesh, right? And so he has to keep them well paid. In the beginning, he was able to do that by,

464
00:32:55,868 --> 00:33:00,188
it's going to be incendiary, but basically rerouting the drug routes or the drug trades,

465
00:33:00,188 --> 00:33:06,388
like the Venezuelan army is in many cases, and don't take it from me, go read this, but it's

466
00:33:06,388 --> 00:33:15,148
basically a drug distribution and production front, right?

467
00:33:16,648 --> 00:33:19,648
And so that kept them at bay for a bit because, you know,

468
00:33:19,708 --> 00:33:21,328
they were the kings of that domain.

469
00:33:21,808 --> 00:33:25,708
But eventually, when 2017 rolled around, he needed something else to give them.

470
00:33:25,708 --> 00:33:28,128
Like in 2015, he did the Dacaso.

471
00:33:28,388 --> 00:33:32,448
So he needed to give people free things.

472
00:33:33,228 --> 00:33:35,308
And most often, they happened around Christmas

473
00:33:35,308 --> 00:33:36,748
because Christmas historically has been around.

474
00:33:37,128 --> 00:33:40,608
Most of the social upheaval happens

475
00:33:40,608 --> 00:33:41,828
because people want money for Christmas

476
00:33:41,828 --> 00:33:43,108
and they want to spend time with their kids.

477
00:33:44,148 --> 00:33:46,668
So anyway, Christmas 2017 rolls around.

478
00:33:47,388 --> 00:33:51,108
And after two years of taking private businesses

479
00:33:51,108 --> 00:33:53,968
and basically putting their inventory in a pinata

480
00:33:53,968 --> 00:33:55,508
for the country to get for free,

481
00:33:56,248 --> 00:33:58,628
most private businesses were very low on inventory

482
00:33:58,628 --> 00:34:00,168
in December by design.

483
00:34:00,168 --> 00:34:02,088
They knew what happened every December,

484
00:34:02,188 --> 00:34:03,668
so they're like, we're not bringing anything this year.

485
00:34:03,668 --> 00:34:13,208
And so he starts basically losing his mind because he's trying to get something to give to his cronies and to the people, but he can't, nobody's importing anything.

486
00:34:14,148 --> 00:34:17,768
But right around December 2017 is when Bitcoin is like peak hype.

487
00:34:18,008 --> 00:34:20,628
You know, it's like we're busting from 17 to 20.

488
00:34:21,628 --> 00:34:24,628
And he basically realizes two things.

489
00:34:24,628 --> 00:34:32,748
one that the only people that have been importing throughout 2017 into into the venezuela economy

490
00:34:32,748 --> 00:34:37,608
inside is this company called bitmain uh imports from this company called bitmain he's like what

491
00:34:37,608 --> 00:34:42,268
is that it's like these are these machines that you can use to my bitcoin and then they you know

492
00:34:42,268 --> 00:34:46,408
this isn't a factual conversation but imagine this is basically how it went behind the scenes

493
00:34:46,408 --> 00:34:52,548
it was like okay so these machines they produce bitcoin yes and if if somebody has them if you

494
00:34:52,548 --> 00:34:57,168
take the machines can you just do they generate bitcoin for you after you take them they're like

495
00:34:57,168 --> 00:35:01,708
yeah you just change the address they're like so we have these machines in this country that

496
00:35:01,708 --> 00:35:08,188
generate this thing that no one can touch it's like yes sir it's like we need them like we need

497
00:35:08,188 --> 00:35:14,768
to get them and so it's like how do we get them so he creates his idea idea number one is i'm going

498
00:35:14,768 --> 00:35:21,148
to create a minor registry so he creates the venezuelan sort of uh crypto regulator suna creep

499
00:35:21,148 --> 00:35:31,448
And he's like, the first task of this government entity is to make a list of everyone mining in the country, where they are, what machines they have, who runs them, who's responsible, all this stuff.

500
00:35:32,328 --> 00:35:36,868
And I'll just say lists of people always turn out really well.

501
00:35:37,048 --> 00:35:38,488
That's always great.

502
00:35:39,388 --> 00:35:40,308
It's absolutely.

503
00:35:41,008 --> 00:35:45,688
And then his second great idea is I'm going to take the miners, but I'm not going to stop there.

504
00:35:45,688 --> 00:35:48,568
I'm going to also create this other coin called the Petro.

505
00:35:48,568 --> 00:35:52,948
and I'm going to try to sell people this shit and trade it for Bitcoin.

506
00:35:53,028 --> 00:35:57,368
Maybe people will be dumb enough that they will give me Bitcoin in exchange for this thing.

507
00:35:58,188 --> 00:36:03,068
And so to create hype around the two things, he creates these roadshows,

508
00:36:03,288 --> 00:36:04,688
the Petro Roadshows, he calls them.

509
00:36:05,368 --> 00:36:09,088
And by the way, just for context, the Petro was a proof of stake coin.

510
00:36:09,188 --> 00:36:10,248
It was never meant to be mine.

511
00:36:10,408 --> 00:36:11,508
There were no ASICs to it.

512
00:36:11,528 --> 00:36:12,728
There was no proof of work anywhere.

513
00:36:13,388 --> 00:36:17,208
But then when he started these roadshows, which is like a series of events across the country,

514
00:36:17,208 --> 00:36:20,028
he's parading ASICs in these shows.

515
00:36:20,108 --> 00:36:22,208
So the shows are basically like ASICs everywhere.

516
00:36:22,748 --> 00:36:24,648
And there's people that are telling you what they sound like,

517
00:36:24,728 --> 00:36:27,588
how much they make, what the energy footprint is,

518
00:36:27,648 --> 00:36:28,988
what the heat footprint is.

519
00:36:29,268 --> 00:36:33,088
Basically like a blueprint on how to find these things

520
00:36:33,088 --> 00:36:37,008
and basically why you should go and find these things

521
00:36:37,008 --> 00:36:39,648
and basically how lucrative it can be if you just get one.

522
00:36:40,608 --> 00:36:43,848
And so this happens throughout the country.

523
00:36:43,848 --> 00:36:51,308
and then two things happened after that that was december around january um late late december

524
00:36:51,308 --> 00:36:55,188
actually a lot of my friends start reporting these surprise visitors to their facilities

525
00:36:55,188 --> 00:37:00,868
and at the beginning they were utility people municipality people then you know two days later

526
00:37:00,868 --> 00:37:04,868
they would just come back with guns being like yeah we need the machines and so extortions like

527
00:37:04,868 --> 00:37:10,228
the extortions uh start happening to the miners i have a few few friends call me freaking out like

528
00:37:10,228 --> 00:37:14,308
what's happening? I got, you know, this guy took 25 machines. I had to give it to him.

529
00:37:15,148 --> 00:37:18,768
You know, I'm going to shut down my rest of my facilities, blah, blah, blah. And we were like,

530
00:37:18,768 --> 00:37:23,488
oh my God, what's going on? And then eventually the inevitable happened. They got to my brother's

531
00:37:23,488 --> 00:37:32,148
facility. That was January 17th, I think, 2018. And my brother wasn't there luckily,

532
00:37:32,148 --> 00:37:37,888
but they raid his facility. They take out his machines and they very quickly start getting in

533
00:37:37,888 --> 00:37:43,488
touch with him to say, you either, you know, we're going to keep the machines. We need you to send

534
00:37:43,488 --> 00:37:48,748
us $25,000, or we're going to make up some charges and throw you in jail. And my brother's like,

535
00:37:48,828 --> 00:37:53,948
jail for what? He's like, we'll make it up, man. Don't worry about it. And my brother's like,

536
00:37:53,988 --> 00:37:57,948
this, this isn't, this can't be happening. So this is like, this is like, I think three or 4 p.m.

537
00:37:59,028 --> 00:38:02,888
And so we start calling our friends to see who can help us, like people we knew that were

538
00:38:02,888 --> 00:38:07,968
connected to parts of, you know, had relatives in the government and such. And we're like, you know,

539
00:38:07,968 --> 00:38:11,428
can you help us try to figure out where this is coming from? Like, why is this happening?

540
00:38:12,508 --> 00:38:16,588
Everybody's like, can't help you, can't help you, can't help you. Meanwhile, the phone calls keep

541
00:38:16,588 --> 00:38:23,168
coming, the threats and the extortion threats keep coming. And then one, and then I think it was

542
00:38:23,168 --> 00:38:29,088
around 7 or 8 p.m. The conversation starts real considering like, like making a run for the border.

543
00:38:29,088 --> 00:38:36,768
and um and so my brother had two kids uh and my wife he was alone in the country there was no fuel

544
00:38:36,768 --> 00:38:41,108
in venezuela because venezuela had fuel shortages because of course it was it was free so everything

545
00:38:41,108 --> 00:38:48,468
that's free disappears um there was no fuel in in the country at all and he had to try and drive

546
00:38:48,468 --> 00:38:53,948
nine hours from our town to the border so we called up our family members that who lived along

547
00:38:53,948 --> 00:38:58,228
the way, thankfully, and they set up these refueling stations for him along the way.

548
00:38:58,668 --> 00:38:59,908
It's a nine-hour journey.

549
00:39:01,208 --> 00:39:04,988
And then around, I think it was 9 p.m., he says, we got to go.

550
00:39:05,568 --> 00:39:09,828
And so he puts his kids in the car, packs up his suitcases, takes his ledger.

551
00:39:11,388 --> 00:39:15,888
And basically, you know, with the little Bitcoin we had, or not little, he had enough Bitcoin

552
00:39:15,888 --> 00:39:17,848
to leave because they couldn't touch the Bitcoin.

553
00:39:17,968 --> 00:39:20,008
They took the ASICs, but the Bitcoin was safe.

554
00:39:20,928 --> 00:39:22,448
So he makes a run for the border.

555
00:39:22,448 --> 00:39:28,768
he leaves at 8 or I think it was 8.30 or 9 and then at around 8 or 9 that time the extortionist

556
00:39:28,768 --> 00:39:33,748
called my dad again and they say I know you're I know you're gonna make a run for it he's like

557
00:39:33,748 --> 00:39:39,828
so we're gonna radio and make sure you don't get out and my brother very smart my dad very smartly

558
00:39:39,828 --> 00:39:43,408
was like no no no we're not making a run for it don't worry just give me two more hours give me

559
00:39:43,408 --> 00:39:47,828
two more hours we're gonna give you the money we're gonna give you the money and to give to buy

560
00:39:47,828 --> 00:39:53,808
time basically and so my brother gets to the border early next early the morning of the next day

561
00:39:53,808 --> 00:39:59,868
and then he calls me before he has to go through and he was like crying and and i said listen dude

562
00:39:59,868 --> 00:40:04,328
you got this far you're gonna get through it's gonna be fine and you're gonna call me from the

563
00:40:04,328 --> 00:40:09,108
other side and we're gonna be super happy and uh he hangs up about a half an hour goes by

564
00:40:09,108 --> 00:40:13,768
fucking excruciating half an hour and um and then he calls me back on the other side

565
00:40:13,768 --> 00:40:23,948
and so he made it out and largely the reason he was able to even consider leaving is because of

566
00:40:23,948 --> 00:40:31,668
bitcoin and because if he had had his savings in a local bank account those assets would be gone

567
00:40:31,668 --> 00:40:37,588
his businesses were a write-off his house was a write-off his cars were a write-off

568
00:40:37,588 --> 00:40:43,988
the only thing that wasn't written off was was his bitcoin but he thankfully he had we had

569
00:40:43,988 --> 00:40:48,568
transitioned enough of our of our businesses and wealth to bitcoin that he had enough of a base to

570
00:40:48,568 --> 00:40:56,308
start from again and um and so by this by this point i was in canada and my my parents were

571
00:40:56,308 --> 00:41:04,328
actually traveling on vacation so none of us went back after that event and um but thankfully you

572
00:41:04,328 --> 00:41:08,948
know through that i was already a bitcoiner by then but that just made my conviction

573
00:41:08,948 --> 00:41:16,148
just even stronger and so for me it was it was for me it was always obvious that this is what i

574
00:41:16,148 --> 00:41:22,168
wanted to do for the rest of my life and once that happened to him i remember going to him

575
00:41:22,168 --> 00:41:27,068
because at the beginning it was it was pretty nerve-wracking for my family to have gone through

576
00:41:27,068 --> 00:41:32,528
all this and and we were you know we were a target back home and even something as me telling you

577
00:41:32,528 --> 00:41:37,068
this story right like i'm only able to tell you these things now and so comfortably because all

578
00:41:37,068 --> 00:41:42,828
my stuff in minnesota is gone and so uh but but a lot of people that are going through these

579
00:41:42,828 --> 00:41:50,248
situations can't even speak speak out about it and uh and so that's why i um you know my family

580
00:41:50,248 --> 00:41:54,448
you know i remember at the beginning i started writing a lot about bitcoin and this is before

581
00:41:54,448 --> 00:41:58,788
this whole thing happened but i remember in the early days i would try to write blogs and stuff

582
00:41:58,788 --> 00:42:00,248
I had no following.

583
00:42:00,448 --> 00:42:03,448
I just wanted to be part of it.

584
00:42:04,188 --> 00:42:06,868
And my parents, I remember after they read my first two blocks,

585
00:42:06,968 --> 00:42:08,408
they were like, Maury, please take this down.

586
00:42:09,148 --> 00:42:10,068
Because they were still back home.

587
00:42:10,148 --> 00:42:12,088
They were getting the mining started.

588
00:42:12,288 --> 00:42:12,908
I'm like, why?

589
00:42:13,068 --> 00:42:16,628
He's like, well, it's not doing us any favors down here.

590
00:42:16,628 --> 00:42:20,588
Things here aren't as you're up there where there's rule of law and stuff.

591
00:42:20,708 --> 00:42:22,788
But down here, we're out.

592
00:42:22,988 --> 00:42:24,188
We're just like sitting ducks.

593
00:42:25,488 --> 00:42:27,848
And I remember it's always been a dance.

594
00:42:27,848 --> 00:42:33,508
even after the story happened you know um my brother did a few like anonymous interviews and

595
00:42:33,508 --> 00:42:38,448
stuff because he he didn't want like you know all that stuff out there in in a way that could

596
00:42:38,448 --> 00:42:43,168
compromise people that were still there or his businesses or anything else but eventually it

597
00:42:43,168 --> 00:42:47,727
came to a point where him and i both sat down and i was like are you cool if i if i just start

598
00:42:47,727 --> 00:42:52,368
sharing this because i think people need to hear about this and he was like yeah let's do it and uh

599
00:42:52,368 --> 00:42:57,788
and so this is his story by the way and thank you danny always for allowing me to to share this as

600
00:42:57,788 --> 00:42:58,428
if it was ours.

601
00:43:00,068 --> 00:43:02,488
But it's not, it sounds cool.

602
00:43:02,628 --> 00:43:02,828
It is.

603
00:43:03,028 --> 00:43:04,928
Listen, I'm very happy about where I am today.

604
00:43:05,048 --> 00:43:06,068
But during that moment,

605
00:43:06,848 --> 00:43:08,368
like the fear is very real.

606
00:43:08,488 --> 00:43:09,908
And I don't fault anybody

607
00:43:09,908 --> 00:43:11,948
that's going through that right now

608
00:43:11,948 --> 00:43:13,328
and can't be as open about things

609
00:43:13,328 --> 00:43:14,468
like as I can be today.

610
00:43:15,688 --> 00:43:16,748
Because I think people don't

611
00:43:17,428 --> 00:43:18,688
necessarily connect the dots

612
00:43:18,688 --> 00:43:20,708
that even by speaking out against the regime,

613
00:43:20,708 --> 00:43:23,708
you're taking a massive, massive risk.

614
00:43:24,128 --> 00:43:25,528
And you don't have to say much.

615
00:43:25,948 --> 00:43:27,227
You don't have to say much.

616
00:43:27,788 --> 00:43:31,588
You know, I've seen people popped and done wrong for a lot less.

617
00:43:32,388 --> 00:43:38,748
And so, yeah, man, that was my story.

618
00:43:40,128 --> 00:43:43,208
It's such an incredible story, and thank you for sharing it.

619
00:43:43,208 --> 00:43:47,288
Because, again, there's so many different things to talk about here.

620
00:43:47,648 --> 00:43:55,508
One of the things that always jumps out at me is that people, I think most people, whether they want to admit it or not,

621
00:43:55,508 --> 00:43:59,528
they get smart by force, not by choice.

622
00:43:59,808 --> 00:44:03,668
This is what my father-in-law, who escaped communism, told me as well.

623
00:44:03,748 --> 00:44:08,208
He's like, I'm a smart guy, but I got smart because I had to get smart,

624
00:44:08,468 --> 00:44:11,548
because I had to figure it out, because this is what you have to do.

625
00:44:11,928 --> 00:44:16,348
Same situation over there, couldn't hold any foreign currencies,

626
00:44:16,348 --> 00:44:20,727
or the securitate would pay a visit to you.

627
00:44:20,727 --> 00:44:30,248
And so, you know, you slice a soap bar in half and hollow it out and put some foreign currency inside and cover it back up and put your pubes all over it.

628
00:44:30,308 --> 00:44:36,448
This is what he did to be able to keep some foreign currency for when he was eventually going to get out.

629
00:44:36,908 --> 00:44:44,648
And hearing the story about your family and your brother, it's just incredible because it's kind of amazing.

630
00:44:44,768 --> 00:44:47,848
Imagine if your dad would have funded one of his other business ideas.

631
00:44:48,408 --> 00:44:50,668
We wouldn't be sitting here having this conversation today.

632
00:44:50,727 --> 00:44:52,708
It's amazing.

633
00:44:53,168 --> 00:45:07,488
But some anonymous developer creates a magic internet money that becomes a lifeline for, I mean, not just Venezuela, but so many people in so many different countries around the world that are living under these punishing authoritarian regimes that are living under hyperinflation.

634
00:45:08,668 --> 00:45:09,828
It's just insane.

635
00:45:10,828 --> 00:45:15,988
Does your brother, can I ask if you can say, does he still mine Bitcoin at all today?

636
00:45:16,168 --> 00:45:18,428
Or did he kind of like leave it totally behind him?

637
00:45:18,628 --> 00:45:20,008
No, they took him.

638
00:45:20,648 --> 00:45:21,008
They took him.

639
00:45:21,028 --> 00:45:22,368
No, but I mean like even now today,

640
00:45:22,488 --> 00:45:24,148
like has he gotten back into it at all?

641
00:45:24,348 --> 00:45:26,488
No, my brother is my right hand on sales.

642
00:45:26,648 --> 00:45:28,748
Danny works with me at Ledin.

643
00:45:29,168 --> 00:45:31,148
And so most people hearing this email,

644
00:45:31,288 --> 00:45:32,448
like most people hearing the show,

645
00:45:32,588 --> 00:45:33,528
if you have a Ledin account

646
00:45:33,528 --> 00:45:35,368
and you've exchanged emails with Danny,

647
00:45:35,648 --> 00:45:36,388
that's Danny.

648
00:45:36,648 --> 00:45:38,588
That's the Daniel from this story.

649
00:45:38,808 --> 00:45:40,988
And he comes with me to a lot of these conferences.

650
00:45:41,448 --> 00:45:43,508
We, you know, a lot of my best clients,

651
00:45:43,748 --> 00:45:45,128
I, you know, he's my right hand guy.

652
00:45:45,808 --> 00:45:48,568
When Ledin was growing leaps and bounds

653
00:45:48,568 --> 00:45:49,428
in the early days,

654
00:45:49,428 --> 00:45:53,788
we needed someone we could trust i needed someone i could trust to help because i was dealing with

655
00:45:53,788 --> 00:45:58,328
all the clients even the cs tickets the whole thing and i was like i need i need some help

656
00:45:58,328 --> 00:46:03,608
and i the only person i could think of that i would trust to have a conversation with people

657
00:46:03,608 --> 00:46:08,248
like bitcoiners and my clients that knew this stuff as well as we did was him because actually

658
00:46:08,248 --> 00:46:12,768
kudos to him he was actually one of let his first power users so when let it came out he was one of

659
00:46:12,768 --> 00:46:16,468
the biggest users of our product because he he had to rebuild his life with bitcoin and he didn't

660
00:46:16,468 --> 00:46:20,848
want to sell it so he actually became one of my top things how how did how did you actually

661
00:46:20,848 --> 00:46:25,208
transition from like what was that journey of starting leaden and then you're like you're i

662
00:46:25,208 --> 00:46:28,668
mean that's gonna be kind of surreal your brother is one of your own like first customers like that's

663
00:46:28,668 --> 00:46:41,795
kind of a beautiful thing like it it all full circle right no totally and uh so it is a very funny story so at the beginning all I knew what to do was mine Bitcoin because that what my family was doing back home But they had free energy

664
00:46:42,195 --> 00:46:46,635
I didn't have free energy, right? And so when you have to start running the numbers at like

665
00:46:46,635 --> 00:46:51,955
13 cents per kilowatt hour, you know, 20 cents per kilowatt hour, mining becomes a lot less

666
00:46:51,955 --> 00:46:57,835
exciting. Nonetheless, it was what I knew what to do or how to do. And that was my sort of the

667
00:46:57,835 --> 00:47:01,295
The thing I could feel like I could add value in that I had set up facilities before.

668
00:47:01,475 --> 00:47:02,495
I knew how to order the rigs.

669
00:47:02,535 --> 00:47:03,435
I knew how to set them up.

670
00:47:03,495 --> 00:47:04,795
I knew how to set up the mining pools.

671
00:47:04,856 --> 00:47:05,715
Like I was good at it.

672
00:47:06,135 --> 00:47:22,555
And so I was like, I'm going to go try to do this in Canada because, you know, and now actually another funny story is when I was trying to help my brother relocate and myself kind of find space to do some mining in Canada, I reached out to the Canadian Bitcoin embassy.

673
00:47:23,416 --> 00:47:25,935
And that was a Montreal-based shop.

674
00:47:25,935 --> 00:47:28,335
and I got an email from none other than Francis Pouillot.

675
00:47:29,555 --> 00:47:32,376
And Francis basically was the one that told me,

676
00:47:32,555 --> 00:47:33,335
come to Quebec.

677
00:47:33,835 --> 00:47:35,396
This is the best place to set up a mine.

678
00:47:35,495 --> 00:47:36,315
We'll help you.

679
00:47:36,755 --> 00:47:37,815
Open arms, man.

680
00:47:37,876 --> 00:47:39,555
And I'm so grateful to him to this day.

681
00:47:40,215 --> 00:47:44,155
And he was the one that basically gave me comfort

682
00:47:44,155 --> 00:47:46,595
or planted the idea that I could mine in Canada,

683
00:47:46,675 --> 00:47:47,615
that you could do something.

684
00:47:48,035 --> 00:47:51,255
Canada wasn't priced out of this activity.

685
00:47:51,995 --> 00:47:55,356
And I convinced my best friend from university, Adam,

686
00:47:55,356 --> 00:47:59,295
who's co-founder of Ledin today, to set up a mine in Canada.

687
00:48:00,376 --> 00:48:06,535
And I had already become very used to this concept of borrowing a weak currency

688
00:48:06,535 --> 00:48:10,095
and holding a hard currency because in Venezuela, I did very well shorting the Bolivar.

689
00:48:10,475 --> 00:48:15,675
It was actually my best trade before being long Bitcoin was going short the Bolivar via dollars.

690
00:48:15,835 --> 00:48:20,195
And the way you do that is you take a Bolivar loan and you buy dollars with it.

691
00:48:20,595 --> 00:48:21,896
It's really that simple.

692
00:48:21,896 --> 00:48:35,735
And so this idea of holding the currency that is not getting debased or getting debased less aggressively and then borrowing the thing that is getting debased to the nth degree does very well financially.

693
00:48:36,015 --> 00:48:45,335
So for me, this idea of shorting the dollar with Bitcoin felt almost like a no brainer.

694
00:48:45,396 --> 00:48:51,155
But at the same time, this concept of shorting the dollar as a foreigner is like, whoa, like, are you really like, you know.

695
00:48:51,155 --> 00:48:56,856
but because you're like oh my god but hold on that's the one that works like wait wait but then

696
00:48:56,856 --> 00:49:01,075
you start basically understanding more of it and you're like wait a second but it works just like

697
00:49:01,075 --> 00:49:06,995
all the others like it's it's not different at all it's just it's just has these other privileges

698
00:49:06,995 --> 00:49:13,155
but it actually breaks just as easy and so and then you see you see bitcoin price the dollars

699
00:49:13,155 --> 00:49:17,035
you see the price that it's doing immediately the graph tells you why am i selling this thing when i

700
00:49:17,035 --> 00:49:23,975
can borrow the dollars from it so in Venezuela I was already used to and kind of curious to see if

701
00:49:23,975 --> 00:49:27,755
anybody would lend dollars against Bitcoin or lend bolivras against Bitcoin but in Venezuela no one

702
00:49:27,755 --> 00:49:31,515
did and I thought that was normal like of course no one would do that but I figured in Canada

703
00:49:31,515 --> 00:49:37,595
somebody must have had this idea who am I to be the first guy to like I'm surely not the first

704
00:49:37,595 --> 00:49:44,695
person to think about this but we set up the mine in Canada with Adam and then very quickly we had

705
00:49:44,695 --> 00:49:48,775
the same issue that everyone else. We have Bitcoin revenues, fiat expenses, don't want to sell the

706
00:49:48,775 --> 00:49:54,495
Bitcoin. And so we said, well, I'm like, hey, let's go try to get a loan. And so we went to a few

707
00:49:54,495 --> 00:49:59,655
financial entities, got laughed out of the room. We got told Bitcoin's not an asset. That one,

708
00:49:59,695 --> 00:50:04,675
that one we got told a lot. I remember that one. Who would do that? It's not an asset. It's not an

709
00:50:04,675 --> 00:50:11,856
asset. And so I kind of looked at Adam and we were getting squeezed by the data center that we were

710
00:50:11,856 --> 00:50:16,055
in they just kept wanting to raise our hydro and then the price of the rigs kept going up

711
00:50:16,055 --> 00:50:19,615
and we're just sitting there in the middle like right like we don't we don't control the price

712
00:50:19,615 --> 00:50:25,115
of the power we don't control the price of the rigs it's not really something where you can just

713
00:50:25,115 --> 00:50:31,396
what can you do other than scale right like it's but then but then we realized that nobody was

714
00:50:31,396 --> 00:50:37,595
servicing the demand for loans like nobody no one serious was actually considering to do these

715
00:50:37,595 --> 00:50:44,356
Bitcoin back loans. And so I looked at them, we looked at each other and we said, we, why not?

716
00:50:44,436 --> 00:50:48,635
Why not us? Like, why can't we be the ones that bring this product to life? Like, why don't we do

717
00:50:48,635 --> 00:50:54,315
Canada's first Bitcoin back loan? And so we, we, we said, okay, like we started running some,

718
00:50:54,376 --> 00:50:57,775
like, how would we do this? We would have to lend, not the full pop. It'd have to be at 50%.

719
00:50:57,775 --> 00:51:01,936
So we started putting like the idea of what a Bitcoin back loan would look like. And right around

720
00:51:01,936 --> 00:51:06,396
the time, there was these other companies that were trying to offer these types of loans, but

721
00:51:06,396 --> 00:51:10,175
they had these tokens, you have to buy the token and the loans, you know, they took all sorts of

722
00:51:10,175 --> 00:51:14,735
these new things as collateral. They issued their own token. They use that as collateral too. And we

723
00:51:14,735 --> 00:51:19,615
just felt the whole thing was like, no, no, no, no. Like we want none of that. Like we want to be

724
00:51:19,615 --> 00:51:25,235
able to like know where the Bitcoin is. I want nothing else around it. I want no other asset

725
00:51:25,235 --> 00:51:34,775
around it. I want no token. I just want a very simple and understandable place or service where

726
00:51:34,775 --> 00:51:38,655
I can just give you Bitcoin to keep it safe, you give me dollars.

727
00:51:38,775 --> 00:51:39,675
Keep that Bitcoin in custody.

728
00:51:39,975 --> 00:51:42,396
Like, I don't want you to do anything fancy with it.

729
00:51:42,455 --> 00:51:43,955
I just want it to be safe.

730
00:51:44,795 --> 00:51:47,075
And so we said, let's do Bitcoin.

731
00:51:47,315 --> 00:51:49,275
No one's done Canada's first Bitcoin back loan.

732
00:51:49,755 --> 00:51:51,975
This was the middle of early 2018.

733
00:51:52,255 --> 00:51:53,835
Like, we're going to be the ones to do it.

734
00:51:54,455 --> 00:51:59,356
And so we pitched this idea to a few angels or people that we knew from the past.

735
00:51:59,356 --> 00:52:08,436
And one of them decided to basically fund us and give us our first $500,000 Canadian check to build a business and a million dollars to lend.

736
00:52:09,175 --> 00:52:11,835
And so we basically got to work.

737
00:52:12,295 --> 00:52:16,856
And we did Canada's first Bitcoin back loan in November 2018 to Francis, actually.

738
00:52:18,015 --> 00:52:20,515
And so we did an event in Montreal.

739
00:52:21,215 --> 00:52:23,575
We basically said, you know, let it's here now.

740
00:52:23,775 --> 00:52:25,175
Canadians can borrow against their Bitcoin.

741
00:52:25,175 --> 00:52:31,275
and then that started this journey of what now has become leaden.

742
00:52:31,535 --> 00:52:33,615
And, I mean, there's obviously a lot of chapters in there

743
00:52:33,615 --> 00:52:35,356
because we didn't start out as the biggest.

744
00:52:35,356 --> 00:52:40,135
Today, I can say, thankfully, we are the biggest consumer Bitcoin-back lender

745
00:52:40,135 --> 00:52:43,575
in the space today, which is still kind of surreal to say

746
00:52:43,575 --> 00:52:44,535
and fills me with pride.

747
00:52:44,675 --> 00:52:45,255
It's amazing.

748
00:52:46,075 --> 00:52:49,175
But when we got started, we were the tiny, boring Canadians,

749
00:52:49,295 --> 00:52:50,115
is what they called us.

750
00:52:50,115 --> 00:52:56,295
And then, but we never chase the shiny light, right?

751
00:52:56,475 --> 00:52:58,575
And we always just stay true to,

752
00:52:59,975 --> 00:53:03,015
our view is that if Bitcoin does what we believe it's going to do,

753
00:53:03,495 --> 00:53:05,515
what else do you need, right?

754
00:53:05,615 --> 00:53:08,035
Like, just be the best at that.

755
00:53:08,275 --> 00:53:09,175
Like, that's it.

756
00:53:09,275 --> 00:53:11,295
If you're just the best at Bitcoin back loans

757
00:53:11,295 --> 00:53:13,575
and Bitcoin becomes what we all think it's going to become,

758
00:53:13,936 --> 00:53:16,795
we and our clients all stand to do very well.

759
00:53:16,795 --> 00:53:23,135
and there's no real need to take you know to juice it up or put a turbocharger here or put

760
00:53:23,135 --> 00:53:30,315
nos in there to make it go faster like the other guys tried to do that it broke uh and so i wanted

761
00:53:30,315 --> 00:53:34,195
to talk to you about that too because you guys i think a lot of people we were talking about this

762
00:53:34,195 --> 00:53:40,856
before we started recording but a lot of people have some like some ptsd from when whenever they

763
00:53:40,856 --> 00:53:46,675
hear about, you know, like Bitcoin backed loans and yield and all of these things, because so many

764
00:53:46,675 --> 00:53:51,635
of the, you know, BlockFi, Celsius, Voyager, like all of these things that blew up as a part of that

765
00:53:51,635 --> 00:53:57,755
larger like SPF, Fioros Capital, you know, contagion, and all of that, all the shenanigans

766
00:53:57,755 --> 00:54:02,555
that were happening there. Now, you guys obviously weathered that storm, you're now the biggest,

767
00:54:02,675 --> 00:54:07,876
you know, provider of these consumer Bitcoin backed loans. What, what was it that allowed you

768
00:54:07,876 --> 00:54:12,916
guys to make it through? What did these other guys do differently where they all just blew up

769
00:54:12,916 --> 00:54:20,515
in such spectacular fashion and yet you guys were just unaffected by this? It's a great question

770
00:54:20,515 --> 00:54:29,335
and it's a nuanced answer, but I'll try to put it in buckets and keep it as simple and concise as I

771
00:54:29,335 --> 00:54:38,495
can. So the concept of collateralized loans is as old as time, right? Like in Babylonian times,

772
00:54:38,495 --> 00:54:45,175
we were borrowing seeds backed by gold and gold backed by goats. And, you know, it's all types of

773
00:54:45,175 --> 00:54:49,255
iterations of this asset backing this loan. This is a collateral, a security, a guarantee that

774
00:54:49,255 --> 00:54:56,916
you're going to pay me back. It's a very natural part of commerce. So in Bitcoin and say gold-backed

775
00:54:56,916 --> 00:55:02,555
loans or mortgages, property-backed loans, or even securities or equity-backed loans,

776
00:55:03,376 --> 00:55:10,535
those things have been going on for hundreds of years. You know, we are... Secured collateralized

777
00:55:10,535 --> 00:55:15,775
lending, by the way, makes up 80% of all loans in the U.S. are backed by something and backed by an

778
00:55:15,775 --> 00:55:23,896
asset. An unsecured credit is actually only 20% of U.S. debt in aggregate. So in our view,

779
00:55:23,896 --> 00:55:30,475
the activity of taking Bitcoin, keeping it safe in a custodian, and then lending you dollars

780
00:55:30,475 --> 00:55:35,775
is a very simple business. If you do it responsibly and you do it correctly,

781
00:55:35,775 --> 00:55:40,615
it's a very safe activity, right? It wasn't the Bitcoin back loans.

782
00:55:41,655 --> 00:55:47,956
It wasn't collateralized lending that brought down these firms. It was a combination of things.

783
00:55:47,956 --> 00:55:55,135
So number one was recklessness and just poor internal risk management decisions.

784
00:55:55,235 --> 00:55:57,475
None of the companies that went under had proof of reserves.

785
00:55:57,715 --> 00:55:58,155
Not one.

786
00:55:58,936 --> 00:56:01,436
So that tells you already a lot, right?

787
00:56:01,495 --> 00:56:05,715
Like not one of these firms ever bothered to do proof of reserves.

788
00:56:06,015 --> 00:56:07,755
Attestation, report, nothing.

789
00:56:08,555 --> 00:56:11,695
At Lennon, we were the first lender to ever do proof of reserves.

790
00:56:12,215 --> 00:56:13,416
And we still do them.

791
00:56:13,495 --> 00:56:16,735
But hey, we have the longest running proof of reserves program in the lending industry.

792
00:56:16,735 --> 00:56:30,595
And that's something we take a lot of pride in. We were doing proof of reserves in 2020 when others were adding DeFi tokens and talking about NFTs, and we were adding proof of reserves.

793
00:56:30,595 --> 00:56:38,896
funny enough today still some legacy companies and some of the newer lenders are coming to market

794
00:56:38,896 --> 00:56:47,015
without proof of reserves which to me is i just i i i can't comprehend why you would do that

795
00:56:47,015 --> 00:56:52,775
right like why would you it seems insane like how can you possibly build up any sort of confidence

796
00:56:52,775 --> 00:57:01,456
i don't know but the truth is we we try not to look at what others are doing we try to look at

797
00:57:01,456 --> 00:57:06,615
how our ship is doing and are we doing like are we doing where we going where we want to be going

798
00:57:06,615 --> 00:57:12,275
so we pour proof reserves at the foundation level of leaden because one comment that i will make is

799
00:57:12,275 --> 00:57:19,115
that the companies that aren't doing proof reserves today most of them is not because they don't want

800
00:57:19,115 --> 00:57:26,615
to is because they cannot. It's because once you have operated a business for six years and you've

801
00:57:26,615 --> 00:57:32,575
added God knows how many products and services and God knows how many assets, gathering your numbers

802
00:57:32,575 --> 00:57:38,356
and getting a snapshot, a precise snapshot of all your assets and all your liabilities at any one

803
00:57:38,356 --> 00:57:46,635
point in time becomes an insurmountable task. It becomes incredibly difficult for a company to then

804
00:57:46,635 --> 00:57:49,035
have to retroactively build proof of reserves.

805
00:57:49,495 --> 00:57:51,115
At Leten, we poured it into the foundation

806
00:57:51,115 --> 00:57:54,755
because everything we built on top of it had to comply.

807
00:57:55,135 --> 00:57:56,655
Whenever we're discussing a product,

808
00:57:56,856 --> 00:57:58,896
an initiative, a feature, anything at Leten is,

809
00:57:59,356 --> 00:58:01,235
how does it interact with proof of reserves?

810
00:58:01,916 --> 00:58:03,775
That's like number one, right?

811
00:58:03,795 --> 00:58:04,475
Can we show it?

812
00:58:05,675 --> 00:58:08,095
And then if not, then it doesn't work.

813
00:58:08,115 --> 00:58:08,735
It's not what we need.

814
00:58:09,315 --> 00:58:11,335
So at Leten, everything is,

815
00:58:11,695 --> 00:58:13,175
the backbone of it is transparency

816
00:58:13,175 --> 00:58:15,035
and does it fit into our program?

817
00:58:15,035 --> 00:58:17,055
Does it fit into the transparency that we have today?

818
00:58:17,595 --> 00:58:19,775
Can we build our existing program?

819
00:58:19,876 --> 00:58:21,456
Can we add it and keep doing it?

820
00:58:22,115 --> 00:58:25,575
So number one was that, lack of proof of reserves.

821
00:58:25,655 --> 00:58:29,815
I would say that's number one commonality among all of these other guys.

822
00:58:30,595 --> 00:58:35,896
The second one I would say was just poor risk management at the underwriting level.

823
00:58:36,055 --> 00:58:37,135
What do I mean by that?

824
00:58:37,135 --> 00:58:45,735
A lot of these companies, the biggest risk that they were taking was there were two huge risks that they were taking.

825
00:58:45,856 --> 00:58:52,615
Number one, they were rehypothecating the Bitcoin collateral or any other collateral asset that they were given as collateral.

826
00:58:52,775 --> 00:58:59,995
They were taking that asset and trading it or relending it or taking additional risk with the collateral.

827
00:58:59,995 --> 00:59:08,595
that in itself is an additional risk because the person who borrowed the dollars and posted that

828
00:59:08,595 --> 00:59:16,575
collateral to you can do everything right can come back and repay you but you out of your own will

829
00:59:16,575 --> 00:59:21,115
may not have that bitcoin because the person you lent it to may not be able to give it back to you

830
00:59:21,115 --> 00:59:26,775
because many times those loans were issued unsecured like the collateral was lent unsecured

831
00:59:26,775 --> 00:59:32,595
and it was done that way because the companies that were doing this many times also offered

832
00:59:32,595 --> 00:59:39,195
yield in Bitcoin, in ETH, in all these other crazy coins that nobody wanted. So what they ended up

833
00:59:39,195 --> 00:59:46,015
having to do was taking these like Dogecoin deposits, convert them into something people

834
00:59:46,015 --> 00:59:51,155
wanted, so dollars or Bitcoin, and then earn the yield. But then you would have an asset liability

835
00:59:51,155 --> 00:59:57,055
mismatch because you owe these people dogecoin you don't owe them dollars and so then if you

836
00:59:57,055 --> 01:00:03,095
didn't hedge that properly you have a you have a gap between what you owe and what you have

837
01:00:03,095 --> 01:00:10,215
and so a unsecured lending for yield was in many cases what brought down these guys because they

838
01:00:10,215 --> 01:00:15,436
made loans to guys like three arrows they made loans to guys like genesis they made loans to

839
01:00:15,436 --> 01:00:17,135
guys like Alameda, et cetera.

840
01:00:18,376 --> 01:00:24,916
And in the context of finance, this isn't a new thing, right?

841
01:00:25,035 --> 01:00:28,416
In finance, there are these concepts of unsecured loans and all these things.

842
01:00:28,416 --> 01:00:35,356
But there's also very well time-tested risk management best practices.

843
01:00:35,695 --> 01:00:40,255
One such of this, like one of the cardinal ones, is concentration risk.

844
01:00:40,255 --> 01:00:47,155
you don't lend out to one person more than you could ever absorb if that person didn't return

845
01:00:47,155 --> 01:00:54,015
the assets that's the concentration risk 101 you would be shocked to see how many companies

846
01:00:54,015 --> 01:01:01,535
managed this like didn't exist so three arrows voyager had 67 of the book out to three arrows

847
01:01:01,535 --> 01:01:09,015
when three arrows went under no there is no equity buffer that can absorb that that was just wildly

848
01:01:09,015 --> 01:01:14,775
irresponsible. Then if you look at BlockFi, they ended up taking the deal with FTX, and that

849
01:01:14,775 --> 01:01:18,936
required them to basically use Alameda for everything. And so when Alameda went down,

850
01:01:19,015 --> 01:01:26,275
it was just impossible for them to recover from that. And so poor underwriting, unsecured loans

851
01:01:26,275 --> 01:01:32,436
on the yield side, rehypothecation of the collateral, lack of proof of reserves, their own

852
01:01:32,436 --> 01:01:37,396
token, like Celsius and others were caught playing games with their own token. So any platform that

853
01:01:37,396 --> 01:01:42,896
has its own tokens massive red flag just shockingly they were playing games with their own shit coin

854
01:01:42,896 --> 01:01:50,956
who could have seen that coming massive and so there was just a lot of the things a lot of there

855
01:01:50,956 --> 01:01:56,235
was a cocktail of bad actors or not bad actors but bad things that were coming together and all

856
01:01:56,235 --> 01:02:02,015
that needed was a little spark and we got that spark with terra luna that lit up three arrows

857
01:02:02,015 --> 01:02:08,315
three arrows lit up celsius celsius lit up genesis genesis lit up sbf and alameda and so all the

858
01:02:08,315 --> 01:02:16,615
dominoes just and the way we navigated that was we had a very simple business you know we had pretty

859
01:02:16,615 --> 01:02:23,916
strong uh risk management like that's that's the moment that leden is built to withstand the

860
01:02:23,916 --> 01:02:30,515
downside more so than it is to rip on the highs because we the highs will take care of themselves

861
01:02:30,515 --> 01:02:34,456
Our job is to protect the ship and our clients on the way down.

862
01:02:34,635 --> 01:02:37,095
The way up, Bitcoin will take us there.

863
01:02:37,695 --> 01:02:41,115
We need to be the best at when things go south.

864
01:02:41,495 --> 01:02:46,575
And that's the other thing I'll say to people is you've seen a lot of these new companies come out and offer Bitcoin-backed loans.

865
01:02:47,135 --> 01:02:48,595
And they all sound exciting.

866
01:02:48,755 --> 01:02:53,155
And there's a new one popping up like every two weeks, it seems, because things are going up and to the right.

867
01:02:54,315 --> 01:02:57,195
Everyone can be a lender when the market's up and to the right.

868
01:02:57,555 --> 01:03:00,356
Literally, everyone can be a lender when the market's up and to the right.

869
01:03:00,515 --> 01:03:07,075
You don't define the quality of a lender by how they perform when things are up and to the right.

870
01:03:07,655 --> 01:03:10,675
We're not here because of how we did when things were up and to the right.

871
01:03:11,015 --> 01:03:13,995
People know us as the people who survived all the downturns.

872
01:03:14,075 --> 01:03:15,115
That's Ledin's name.

873
01:03:15,815 --> 01:03:22,456
And I'm hugely proud of that because all the Bitcoiners know that we are going to go where this thing takes us.

874
01:03:23,436 --> 01:03:26,695
In the words of my dad, don't fuck it up.

875
01:03:29,235 --> 01:03:30,255
That's what he told me.

876
01:03:30,255 --> 01:03:34,715
when i called him actually i remember because he's like my mentor right and i remember i called him

877
01:03:34,715 --> 01:03:38,715
when all these things were happening like all these companies were collapsing and i had clients

878
01:03:38,715 --> 01:03:42,856
calling me you know some people were nervously withdrawing because they thought we were going

879
01:03:42,856 --> 01:03:47,215
to get contained like we were going to be part of the contagion and i was just like listen don't

880
01:03:47,215 --> 01:03:51,535
take it from me withdraw we'll be here when you're when you're ready like we're not going anywhere

881
01:03:51,535 --> 01:03:56,315
take your bitcoin i would much rather you take it out if you if you're calling me to you know if you

882
01:03:56,315 --> 01:03:59,976
if you feel if your gut's telling you something could be wrong take it out come back to us when

883
01:03:59,976 --> 01:04:05,195
you're good like we i'm no rush and so i was calling my dad and i was kind of laying out what

884
01:04:05,195 --> 01:04:12,936
was happening and he goes he goes so so wait a second the the five guys that were all bigger than

885
01:04:12,936 --> 01:04:20,655
you are gone like they're gone and i'm like yeah yeah dad it was like it was like a nuclear bomb

886
01:04:20,655 --> 01:04:25,476
it wiped out everyone he's like and you're the only one that's still standing and i was like

887
01:04:25,476 --> 01:04:30,175
yeah i mean i think there's one or two more but like we're the only like yeah and he goes son

888
01:04:30,175 --> 01:04:37,155
you've been given the biggest gift it's like get back on the horse and don't fuck this up

889
01:04:37,155 --> 01:04:44,896
and um and i still remember that because at the time you know looking like how long i never thought

890
01:04:44,896 --> 01:04:48,675
that we were going to be back here just three years after i thought it was going to be decades to

891
01:04:48,675 --> 01:04:56,115
to rebuild the trust because it was really hard like for 2023 2022 were tough years because people

892
01:04:56,115 --> 01:05:01,876
were coming to us and it's very hard trying to understand the same question you just asked me

893
01:05:01,876 --> 01:05:07,595
how did you survive right because when you see there was a basket of 12 apples and 11 of them

894
01:05:07,595 --> 01:05:12,495
were rotten and one of them was good you don't think oh that apple must have done something right

895
01:05:12,495 --> 01:05:15,275
You think something's wrong with apples just in general.

896
01:05:15,376 --> 01:05:17,235
Just stay away from apples, right?

897
01:05:17,775 --> 01:05:23,956
And so we would explain like, no, like it wasn't actually that they were doing the same thing we were doing.

898
01:05:24,035 --> 01:05:25,655
We were doing completely different things.

899
01:05:25,715 --> 01:05:27,715
They were lending things without taking collateral.

900
01:05:27,896 --> 01:05:28,595
They were underwriting.

901
01:05:28,916 --> 01:05:30,315
They were taking tokens that had no market.

902
01:05:30,495 --> 01:05:32,835
Like it was a very different – it just looked similar.

903
01:05:33,055 --> 01:05:34,255
But we were very different.

904
01:05:34,335 --> 01:05:35,315
We still are very different.

905
01:05:36,175 --> 01:05:38,135
And, yes, it took time.

906
01:05:38,275 --> 01:05:40,995
Like people – it took time to rebuild trust.

907
01:05:40,995 --> 01:05:51,295
It took time for people to understand that people like Ledin did have a sound business model, that we are built to survive these types of volatile events and that we can help you and be there when the market goes up.

908
01:05:52,476 --> 01:05:58,115
And so that trust has come slowly, gradually, then suddenly.

909
01:05:58,476 --> 01:06:02,956
And the funny thing is, none of these new Bitcoin back lenders came in the gradually part.

910
01:06:03,675 --> 01:06:05,715
They all showed up when we broke 100.

911
01:06:06,255 --> 01:06:07,916
And so everybody came out trying to lend.

912
01:06:07,916 --> 01:06:11,195
And I'm like, listen, this product isn't new, man.

913
01:06:11,195 --> 01:06:15,635
Like if you wanted to lend back by Bitcoin, you know, you could have seen the light.

914
01:06:17,235 --> 01:06:20,295
2019, 2020, 2021, 22, 23, 24.

915
01:06:21,155 --> 01:06:22,916
You saw it here now, 2025.

916
01:06:23,615 --> 01:06:24,115
Great.

917
01:06:24,956 --> 01:06:36,476
But I would be cautious of companies that are launching products, trying to time the market and seem to be tinkering the product on the fly.

918
01:06:36,476 --> 01:06:43,635
versus companies that are just not trying to time the market, right?

919
01:06:43,715 --> 01:06:49,055
Like, you know, like I said, if you're coming to market today

920
01:06:49,055 --> 01:06:51,476
with a Bitcoin-backed loan product that has no proof of reserves,

921
01:06:51,555 --> 01:06:53,175
you're probably trying to rush that thing into the market.

922
01:06:53,175 --> 01:06:56,175
And those things don't generally end well.

923
01:06:57,815 --> 01:06:59,376
So, yeah, anyway, end of rant.

924
01:06:59,396 --> 01:07:00,055
Let me ask you, too.

925
01:07:00,575 --> 01:07:03,795
I mean, as we look, like, obviously, things are very different

926
01:07:03,795 --> 01:07:09,595
in terms of where the conversation is at now in 2025 versus when you guys started.

927
01:07:09,775 --> 01:07:12,476
Like Bitcoin is, you know, quote, mainstream now.

928
01:07:13,055 --> 01:07:18,315
You've got a much friendlier regulatory regime than we had even, you know, a year ago,

929
01:07:18,416 --> 01:07:19,376
as well, at least in the U.S.

930
01:07:20,335 --> 01:07:22,396
And the vibe seems to have kind of shifted.

931
01:07:22,515 --> 01:07:23,635
So I'm curious, too.

932
01:07:23,735 --> 01:07:29,195
I mean, do you foresee, I mean, it seems that it's only a matter of time before a lot of the big banks,

933
01:07:29,195 --> 01:07:31,995
now that, you know, SAB-121 has been repealed.

934
01:07:32,856 --> 01:07:38,515
They're, you know, obviously like the SAB 122 will come out that will, you know, make clarify all of that nonsense.

935
01:07:38,715 --> 01:07:47,675
But, I mean, do you think some of your biggest competitors going forward here are just going to be some of these like big existing fiat banks that kind of are wanting a piece of that pie?

936
01:07:48,315 --> 01:07:51,015
I mean, are they going to like look to gobble you guys up?

937
01:07:51,135 --> 01:07:53,035
Like, have you been thinking about that at all?

938
01:07:53,235 --> 01:07:54,356
Where's your head at with that?

939
01:07:55,456 --> 01:08:01,655
Yeah, I mean, listen, I think about our industry a lot and the possible paths of evolution.

940
01:08:01,995 --> 01:08:11,255
I've always believed, at least speaking personally, that Ledin is going to be a close ally and a competitor of banks, of traditional banks.

941
01:08:11,255 --> 01:08:12,695
We are a regulated lender.

942
01:08:13,436 --> 01:08:18,395
And there's a reason why we chose to go the regulated route.

943
01:08:18,556 --> 01:08:31,215
And it's because we believe that once Bitcoin gets fully ingrained into the system, you're going to want to, in the game of lending or in the business of lending, you need to have the lowest cost of capital.

944
01:08:31,215 --> 01:08:45,655
Right. That that is one of the biggest drivers of how if you win or not is can you deliver the best product at the best price and to get the best cost of capital, you need to be able to talk to pensions, endowment funds, banks.

945
01:08:45,795 --> 01:08:59,715
You know, these are the people that have trillions of dollars at net negative rates in treasury bonds. Right. And so you can get them over to the line. And that's big, big money, like big clips.

946
01:08:59,715 --> 01:09:07,395
and that is what's going to give you the fuel to drop the cost of bitcoin mac loans which is going

947
01:09:07,395 --> 01:09:12,855
to make them exponentially more accessible and usable because as the cost drops you can do more

948
01:09:12,855 --> 01:09:17,916
things with it right it's it's almost like uh it's non-linear right like as the rates drop the

949
01:09:17,916 --> 01:09:24,235
things you can do with them go exponentially higher and so i believe i i almost it's almost

950
01:09:24,235 --> 01:09:30,956
for me a certainty it's an inevitability that banks are going to try to get into this and

951
01:09:30,956 --> 01:09:37,695
i think today i'll say it you know some of our biggest and best partners are banks today and

952
01:09:37,695 --> 01:09:43,376
that was not the case two years ago so banks are not coming they're here like they're already here

953
01:09:43,376 --> 01:10:01,204
and so a couple of things there like will some of them try to bring these these products to market themselves Probably I think a few of them will If you look at the bank landscape in the US there thousands of banks right

954
01:10:01,403 --> 01:10:04,644
And so there will be,

955
01:10:05,164 --> 01:10:09,284
I think that the way I like to think of this

956
01:10:09,284 --> 01:10:12,564
is the size of the opportunity

957
01:10:12,564 --> 01:10:14,604
that is Bitcoin-backed loans.

958
01:10:15,184 --> 01:10:17,324
And that, I think it's going to be

959
01:10:17,324 --> 01:10:26,983
a multi-trillion dollar asset class in 10 years from now. And so how many banks can the US fiat

960
01:10:26,983 --> 01:10:35,144
system support? Thousands of banks. How many banks offer mortgages? All of them, right? And so it's

961
01:10:35,144 --> 01:10:42,903
going to become a ubiquitous product, right? And that said, it's a ubiquitous product that runs

962
01:10:42,903 --> 01:10:48,204
on net new rails. Banks are not set up to be there on the weekend for you. Banks are not set up for

963
01:10:48,204 --> 01:10:56,284
overnight transactions. Banks are not set up for international cross-border settlements and sending

964
01:10:56,284 --> 01:11:04,284
things like they are in the fiat world, but not in the Bitcoin world. So my North Star is to continue

965
01:11:04,284 --> 01:11:09,644
delivering the best Bitcoin-backed loan experience and the best Bitcoin financial services experience

966
01:11:09,644 --> 01:11:12,583
that you can't get at a bank, right?

967
01:11:12,583 --> 01:11:15,483
And the other thing to say is,

968
01:11:15,903 --> 01:11:16,923
Leonard is a global company.

969
01:11:17,204 --> 01:11:18,664
We service over 100 countries.

970
01:11:19,923 --> 01:11:21,224
Banks are coming in the US.

971
01:11:22,204 --> 01:11:25,523
That's not helping people in 97 or 99

972
01:11:25,523 --> 01:11:27,304
of the other countries we operate in.

973
01:11:27,744 --> 01:11:33,343
And so we see this as a game changer for the world

974
01:11:33,343 --> 01:11:35,744
because Bitcoin is the first time.

975
01:11:36,383 --> 01:11:38,284
The Americans, not the Americans, not the media.

976
01:11:38,423 --> 01:11:39,284
It's like Americans are great.

977
01:11:39,284 --> 01:11:41,564
You guys have all these financing options.

978
01:11:41,764 --> 01:11:48,123
Like, do you guys, a Bitcoin-backed loan is like I put the 17th club in your golf pack, right?

979
01:11:48,204 --> 01:11:51,083
Like, you're like, oh, sure, one more thing I can leverage.

980
01:11:51,184 --> 01:11:52,064
Amazing, right?

981
01:11:52,604 --> 01:11:57,224
But if you look at a place like, I'll just give you the landscape of asset-backed lending.

982
01:11:57,843 --> 01:12:02,343
A person that wants to borrow money against their house in Medellin, Colombia,

983
01:12:02,343 --> 01:12:06,664
is going to get hosed on terms relative to an American

984
01:12:06,664 --> 01:12:09,363
trying to get a loan on a Manhattan property.

985
01:12:11,003 --> 01:12:14,204
Asset-backed lending has been unfair and uneven

986
01:12:14,204 --> 01:12:16,744
since the creation of fiat.

987
01:12:17,064 --> 01:12:19,363
There hasn't been an asset up until today

988
01:12:19,363 --> 01:12:22,104
that I can take from you, Walker, in America

989
01:12:22,104 --> 01:12:24,144
and from Miguel in Medellin

990
01:12:24,144 --> 01:12:26,144
and offer you the same terms and the same financing.

991
01:12:26,144 --> 01:12:27,604
And to me, it's the same underwriting.

992
01:12:28,403 --> 01:12:30,843
That didn't exist until Bitcoin.

993
01:12:31,403 --> 01:12:35,824
So now I can give Miguel in Medellin the same terms I'm giving Carlos in Madrid,

994
01:12:36,064 --> 01:12:37,604
and I'm giving Peter in Lisboa.

995
01:12:38,983 --> 01:12:40,784
That, to me, is the game changer.

996
01:12:41,483 --> 01:12:45,003
Because all those guys are going to be borrowing at the same rates as you, Walker.

997
01:12:45,843 --> 01:12:48,483
And they could not say that.

998
01:12:48,583 --> 01:12:53,184
None of those people could have ever said that if it wasn't for now they can use the same asset.

999
01:12:53,843 --> 01:12:55,523
And now they can access the same company.

1000
01:12:56,144 --> 01:12:59,184
And so I'm excited about banks coming into the space.

1001
01:12:59,184 --> 01:13:18,144
I actually think to me the most exciting part is I'm going to take, hopefully, Leden is going to be a vehicle through which institutional OECD market money can go to fund Bitcoin-backed loans and entrepreneurial projects everywhere in the world at a fair cost of capital to everyone with the best collateral in between.

1002
01:13:18,744 --> 01:13:21,463
And so I see this as a game changer globally.

1003
01:13:21,463 --> 01:13:29,123
How this impacts the U.S. landscape and which banks become incrementally bigger or incrementally smaller, I don't think we're playing just for the U.S. market here.

1004
01:13:29,184 --> 01:13:38,664
um i think we're we're playing for the the mortgage vehicle equivalent of the world a safe asset that

1005
01:13:38,664 --> 01:13:43,784
you can use to get world-class financing for because let's face it like most of the value of

1006
01:13:43,784 --> 01:13:47,583
the u.s property is just how much leverage you can get for it and the terms you can get on that

1007
01:13:47,583 --> 01:13:52,923
leverage it's not just it's not the house um and so i think bitcoin will do something similar

1008
01:13:52,923 --> 01:14:18,543
Do you think that Bitcoin, I mean, it's like, again, we, you and I know, and many more people are waking up to the fact that Bitcoin is the best money, right? And obviously, that takes some time. So you mentioned the cost of capital and whatnot. Obviously, right now, I assume, it's still a little more expensive to get a Bitcoin backed loan than it is to get some other types of loans, right?

1009
01:14:18,543 --> 01:14:31,664
Like, do you see, to me, it seems logical that that would, the more adoption Bitcoin has, the more that paradigm will shift to where it's like, oh, you're putting up the most, you know, the hardest money that's ever existed is your collateral.

1010
01:14:31,664 --> 01:14:36,184
Well, you're going to get the best terms that have ever existed relative to any other collateral you would provide.

1011
01:14:36,363 --> 01:14:39,744
Is that where you think, and like, how long does that process take?

1012
01:14:40,823 --> 01:14:43,164
Yes, I agree with that.

1013
01:14:43,704 --> 01:14:48,264
The issue I have with that is that it's the goalpost.

1014
01:14:48,543 --> 01:14:49,543
It's not the thesis.

1015
01:14:49,883 --> 01:14:50,943
The thesis checks out.

1016
01:14:51,123 --> 01:14:57,383
Bitcoin will be the best, most efficient way to get the cheapest free market cost of capital.

1017
01:14:57,943 --> 01:15:01,003
Why do I qualify that as a free market cost of capital?

1018
01:15:01,003 --> 01:15:07,523
Because sometimes people like to compare the interest rate on a Bitcoin-backed loan to the interest rate on a mortgage.

1019
01:15:08,323 --> 01:15:14,083
And those are very different markets, and mortgages are not the free market.

1020
01:15:14,664 --> 01:15:16,304
I'll give you some examples.

1021
01:15:16,304 --> 01:15:25,184
michael saylor just offered his strc issuance it's a dollar denominated liquidity vehicle

1022
01:15:25,184 --> 01:15:31,564
almost like a u.s treasury how much did michael what's the coupon on that nine percent right

1023
01:15:31,564 --> 01:15:38,043
michael pays nine percent his cost of capital is nine percent okay the interest rates that i pay

1024
01:15:38,043 --> 01:15:43,844
on my usdc growth accounts today which is deposits that people deposit usdc stable coin deposits

1025
01:15:43,844 --> 01:15:48,184
people can make and you can tether and i pay them interest i pay eight and a half on the highest tier

1026
01:15:48,184 --> 01:15:56,363
on that why are those numbers so closely together and why are most private financing options outside

1027
01:15:56,363 --> 01:16:05,583
of mortgages in the nine to ten percent ballpark because the true break-even interest rate for the

1028
01:16:05,583 --> 01:16:12,543
U.S. dollar is not the Fed overnight funds, is the U.S. projected deficit over the U.S.'s

1029
01:16:12,543 --> 01:16:18,923
M2 money supply. And if you look at that projected number for 2025, that sits at around 8%,

1030
01:16:18,923 --> 01:16:28,244
8.5%. And if you look at the projected one for 2025, 2026, 8.5%. And so the truest,

1031
01:16:28,244 --> 01:16:38,744
cheapest cost of dollars today, non-subsidized and in the free market, should be between eight

1032
01:16:38,744 --> 01:16:45,604
and a half percent or nine plus a slight risk premium, right? And so that is where I think the

1033
01:16:45,604 --> 01:16:54,784
rubber meets the road. A follow-on from that would be to call out or rather mention that in some

1034
01:16:54,784 --> 01:17:01,704
places in decentralized finance where there is no kyc or no type of controls there seems to be

1035
01:17:01,704 --> 01:17:08,724
people happy to take four to five to six percent on stable coins and some of these defy protocols

1036
01:17:08,724 --> 01:17:15,963
are touting these rates of you know eight and seven and this so so they're the end user is

1037
01:17:15,963 --> 01:17:24,264
borrowing below the rate of debasement i don't think that that is an uh uh a completely free and

1038
01:17:24,264 --> 01:17:28,863
untainted market in the same way I don't think the mortgage rates are a completely free and

1039
01:17:28,863 --> 01:17:36,423
untainted market. So what I look at to compare are my rates fair, high or low, is look at the

1040
01:17:36,423 --> 01:17:42,443
debasement of the US dollar, the true debasement of the US dollar vis-a-vis your rate. And you

1041
01:17:42,443 --> 01:17:49,784
should be within a few points of that should be okay. If it's on the other side, you're picking

1042
01:17:49,784 --> 01:17:55,704
up, you know, a dollars for 80 cents, right? And who's paying the rest of the 20 and why?

1043
01:17:56,664 --> 01:18:03,403
I don't know, but someone is. And you better be sure someone is, because there's no free lunch.

1044
01:18:04,323 --> 01:18:09,104
Yeah. No, I think that's a really great explanation of that. And you mentioned the

1045
01:18:09,104 --> 01:18:14,123
mortgage market. And I think it's interesting, obviously, there's been a lot of,

1046
01:18:14,204 --> 01:18:19,204
we mentioned the regulatory changes and just kind of this vibe shift that we've seen around this,

1047
01:18:19,204 --> 01:18:22,184
at least in the U.S., and hopefully starting in some other places.

1048
01:18:22,463 --> 01:18:22,664
I don't know.

1049
01:18:22,704 --> 01:18:25,244
Europe seems to be maybe shifting in the opposite direction.

1050
01:18:25,323 --> 01:18:25,664
Who knows?

1051
01:18:26,224 --> 01:18:31,104
But, you know, Bitcoin now being acknowledged as like they've said,

1052
01:18:31,204 --> 01:18:34,784
okay, Pulte, Bill Pulte, right?

1053
01:18:35,123 --> 01:18:35,383
Yeah, yeah, yeah.

1054
01:18:35,383 --> 01:18:38,744
And this happened like as we were in D.C., I think.

1055
01:18:38,883 --> 01:18:41,564
I remember it was like, I forget who was that announced it on stage,

1056
01:18:41,583 --> 01:18:42,863
but it was kind of cool to see that.

1057
01:18:43,423 --> 01:18:46,503
But basically saying, okay, if any man, Freddie Mac need to consider

1058
01:18:46,503 --> 01:18:53,104
consider Bitcoin as an asset when it comes to, you know, these loans and like, how do you see this

1059
01:18:53,104 --> 01:18:57,863
like landscape shifting? Are there other are there other changes that you would like to see

1060
01:18:57,863 --> 01:19:02,204
at the regulatory level that like really make a difference to you? Do you think that there's

1061
01:19:02,204 --> 01:19:05,923
enough of a framework in place where you guys can do business comfortably? Or are you still

1062
01:19:05,923 --> 01:19:09,244
are there certain things that you're pushing for that you're advocating for that you want to see

1063
01:19:09,244 --> 01:19:13,523
from this administration or from subsequent administrations, assuming the pendulum doesn't,

1064
01:19:13,523 --> 01:19:19,164
you know, swing back and hit us in the face? No, great, great, great question. And so I'll break

1065
01:19:19,164 --> 01:19:24,883
that up into two. So number one, I can touch on what I think the real impact of the new guidance

1066
01:19:24,883 --> 01:19:30,764
is for Fannie and Freddie as it comes to mortgages. So the guidance, you know, for anyone's benefit is

1067
01:19:30,764 --> 01:19:38,104
that the Fannie and Freddie are basically being asked to consider Bitcoin or crypto as part of the

1068
01:19:38,104 --> 01:19:45,064
asset base of the applicant. And this is a very important distinction because a mortgage goes

1069
01:19:45,064 --> 01:19:49,923
through what's called traditional credit underwriting. So they will issue your loan

1070
01:19:49,923 --> 01:19:57,423
not based on the assets you own. They will issue your loan based on your after-tax income and your

1071
01:19:57,423 --> 01:20:05,784
capacity to service the debt. The amount you can borrow is not determined by how much Bitcoin you

1072
01:20:05,784 --> 01:20:13,064
have or how much stock you have, it's determined by how much after-tax income you can get predictably.

1073
01:20:13,804 --> 01:20:18,604
And any self-employed person or entrepreneur that's tried to get a mortgage will know exactly

1074
01:20:18,604 --> 01:20:22,644
what I'm saying. If you go to the bank and you say you have a business that generates this much,

1075
01:20:22,724 --> 01:20:29,284
they'll say, sorry, that's not income, man. I want your T4 fully muzzled up, paid every single cent

1076
01:20:29,284 --> 01:20:36,104
in taxes and I want to see a big tax bill, that means I can give you some of this sweet juice.

1077
01:20:37,023 --> 01:20:43,144
And it's not based on Bitcoin. So you can show up right now to Bank of America and tell them you

1078
01:20:43,144 --> 01:20:45,923
have a million dollars worth of Bitcoin that you're looking to buy a half a million dollar

1079
01:20:45,923 --> 01:20:50,943
house and you tell them that you retire and they'll laugh you out of the room. And so it's not

1080
01:20:50,943 --> 01:20:57,123
true asset-backed lending in the sense that it is income-based lending and then they just take an

1081
01:20:57,123 --> 01:21:02,724
asset to be super, super safe that they're going to get their money back. Bitcoin-backed loans are

1082
01:21:02,724 --> 01:21:09,224
entirely different in that it is only determined by the value of the collateral you're posting.

1083
01:21:09,403 --> 01:21:15,363
I do not look at your credit history. I do not go on your credit records or any of that stuff.

1084
01:21:15,623 --> 01:21:20,463
Your Bitcoin is your credit worthiness. I can lend you dollars based on the value of that Bitcoin.

1085
01:21:20,823 --> 01:21:25,564
It's two very different things. So while I think it's a good step forward, it doesn't solve this

1086
01:21:25,564 --> 01:21:31,204
pickle of somebody that is now you know bitcoin wealthy uh self-employed wants to start a business

1087
01:21:31,204 --> 01:21:37,284
they still can't get a mortgage yeah um so the other piece that you mentioned around regulation

1088
01:21:37,284 --> 01:21:41,583
so one of the ones that i'm actually uh one of the ones that i've kind of like peaked my eyes

1089
01:21:41,583 --> 01:21:46,844
and i was like well that's exciting was um atkins sec chair uh i think it was last week or the week

1090
01:21:46,844 --> 01:21:52,503
before did this big speech around uh you know it was the one where people all got got all excited

1091
01:21:52,503 --> 01:21:57,583
about tokenizing securities, tokenizing stocks and bringing the stock market on chain and all

1092
01:21:57,583 --> 01:22:02,923
this stuff. And most people got excited at that headline. But what caught my attention was he said

1093
01:22:02,923 --> 01:22:09,863
in his speech that he wants to put forward a framework or guidance so that there could be

1094
01:22:09,863 --> 01:22:16,623
these super apps. And the super app section of the guidance basically says, why are we forcing

1095
01:22:16,623 --> 01:22:22,104
a lending company? I'll give you the example of Leden. Lending is done state by state. So

1096
01:22:22,104 --> 01:22:26,724
So Latin has to go and look at every single state and figure out, do we need a license for this one?

1097
01:22:27,284 --> 01:22:28,724
If not, then what are the rules?

1098
01:22:29,064 --> 01:22:30,423
And then this state and that state and that state.

1099
01:22:30,443 --> 01:22:31,963
So we have to do that 50 some times.

1100
01:22:32,644 --> 01:22:34,823
And then we have to do that for any country.

1101
01:22:35,184 --> 01:22:35,903
Canada is similar.

1102
01:22:36,043 --> 01:22:37,244
Canada is province by province.

1103
01:22:38,583 --> 01:22:40,104
And then that's for lending.

1104
01:22:40,264 --> 01:22:43,123
But then if you want to do buy and sell, you have to get a money transmitter license.

1105
01:22:43,123 --> 01:22:48,323
And so it's this smorch board of licenses based on states and activities.

1106
01:22:48,323 --> 01:22:53,284
and it creates this unnecessary burden on a company.

1107
01:22:53,483 --> 01:22:55,483
If you're already following the rules in one state,

1108
01:22:55,564 --> 01:22:57,804
you have to like tweak it and fit the box of this other one

1109
01:22:57,804 --> 01:22:58,344
and then tweak it.

1110
01:22:58,403 --> 01:23:00,003
And they're all pretty similar, but not the same.

1111
01:23:00,764 --> 01:23:04,684
And so what I found super interesting is he said,

1112
01:23:04,804 --> 01:23:06,583
why are we making life so hard for these companies?

1113
01:23:06,804 --> 01:23:09,543
Let's make one framework fit into this

1114
01:23:09,543 --> 01:23:10,644
and you get the whole market

1115
01:23:10,644 --> 01:23:12,744
and you get more than one product.

1116
01:23:13,164 --> 01:23:15,583
So I think that if and when that comes through,

1117
01:23:15,583 --> 01:23:21,104
that's going to materially improve the speed at which companies can bring products to market

1118
01:23:21,104 --> 01:23:28,423
compliant products to market and i think that'll bode well for you know the u.s like if you go back

1119
01:23:28,423 --> 01:23:34,144
not too long ago it was it was this is available everywhere except the u.s everywhere except the

1120
01:23:34,144 --> 01:23:39,664
u.s u.s client is excluded so it was like completely went the other side when we were

1121
01:23:39,664 --> 01:23:44,083
under the previous administration and so probably the first time americans have ever like had that

1122
01:23:44,083 --> 01:23:47,564
Like usually we get, you know, like it was a real shock, you know.

1123
01:23:47,704 --> 01:23:49,664
It must have been so trivial for you guys.

1124
01:23:49,943 --> 01:23:52,304
It was really hard here in America.

1125
01:23:53,564 --> 01:23:58,064
And so I think that's going to make things move a lot faster.

1126
01:23:58,744 --> 01:24:02,844
And I think that actually is going to put a lot more pressure on the banks, right?

1127
01:24:02,863 --> 01:24:11,083
Because I think actually the banks are in this awkward spot because right now they're sort of like in the General Motors position when Tesla started coming up.

1128
01:24:11,083 --> 01:24:17,323
You know, there's this assumption they're just going to spin up your EV and it's going to be great and it's going to be better than Tesla.

1129
01:24:17,943 --> 01:24:23,023
But all of a sudden your EV goes out and nobody likes it and it's crappier and the mileage is not so good.

1130
01:24:23,064 --> 01:24:25,164
You don't get it. You can't really nail the messaging.

1131
01:24:25,883 --> 01:24:31,923
And so I think banks are in this quirky spot in that, like, people want Bitcoin native companies.

1132
01:24:32,304 --> 01:24:34,483
Bitcoiners want to work with other Bitcoiners.

1133
01:24:34,483 --> 01:24:40,583
They don't want to work with the sellouts or the guys that are coming in to be like, OK, great, great job here.

1134
01:24:40,583 --> 01:24:45,443
now we're here and uh you know we're gonna come take over i don't think none of the og like people

1135
01:24:45,443 --> 01:24:49,644
that have been in this space for years are gonna go and be like oh my god thank god wells fargo

1136
01:24:49,644 --> 01:24:54,503
got here i'm just gonna go drop all my stack to wells fargo like they might get some of their

1137
01:24:54,503 --> 01:25:00,883
legacy clients that have been with them for years but by and large i look at this almost like uh

1138
01:25:00,883 --> 01:25:07,844
um like an uber versus a taxi analogy where like a lot of the big taxi companies also launch apps

1139
01:25:07,844 --> 01:25:14,844
but no one really cared to use those apps right because one app is now global right so now i can

1140
01:25:14,844 --> 01:25:19,503
use let it anywhere i am i can recommend it to my friends i can recommend it to my partners like i

1141
01:25:19,503 --> 01:25:24,804
can i can relate to the content it's not like oh i work with bank of so-and-so here maybe you

1142
01:25:24,804 --> 01:25:30,344
uh steven maybe you can use this one i heard they're pretty good too it's it's i don't know

1143
01:25:30,344 --> 01:25:35,823
how this plays out i think that's a great analogy like it makes sense because you're absolutely

1144
01:25:35,823 --> 01:25:40,284
right like bitcoiners especially if they've been around for a while like and they've seen these

1145
01:25:40,284 --> 01:25:44,724
various cycles and seen the blow-ups that have happened it's like you know it's there's a don't

1146
01:25:44,724 --> 01:25:49,784
trust verify ethos obviously and you're you're not gonna want you know it's like oh you know

1147
01:25:49,784 --> 01:25:55,184
uh you know jp morgan comes out with it and it's like yeah okay well kind kindly fuck off you know

1148
01:25:55,184 --> 01:26:00,784
like no no thank you jamie diamond you know you can go suck one um like you've been anti-bitcoin

1149
01:26:00,784 --> 01:26:05,804
for years but here let me give you my bitcoin like no no absolutely not not in a million years

1150
01:26:05,804 --> 01:26:11,764
no i i saw a hundred percent and like you know how does that come at odds with like this idea

1151
01:26:11,764 --> 01:26:15,144
that most of us should have our own stuff in self-custody right like i'm only going to go to

1152
01:26:15,144 --> 01:26:19,363
these places if i need to use loan right i'll give you the bitcoin while i need my loan and

1153
01:26:19,363 --> 01:26:24,564
stuff like that but there's there's not this most a lot of people use banks as a sort of um

1154
01:26:24,564 --> 01:26:29,883
like offloading their self-sovereignty from a financial perspective they're like oh it's just

1155
01:26:29,883 --> 01:26:34,583
warm and fuzzy and it's insured and but we bitcoiners are built different we we build not

1156
01:26:34,583 --> 01:26:39,644
to trust the banks i joke that i grew up in venezuela it was every venezuelan the latem

1157
01:26:39,644 --> 01:26:44,323
banking system is like the world cup every four years a banking system collapses in latem and we

1158
01:26:44,323 --> 01:26:49,064
all look at it we're like oh what happened to you we're like oh well it was this guy and so we've

1159
01:26:49,064 --> 01:26:55,983
been we've been bred not to trust our banks and so for us this whole idea of fdic like okay

1160
01:26:55,983 --> 01:27:02,823
we've seen what happens when the money actually goes missing and you get the reprinted replacement

1161
01:27:02,823 --> 01:27:06,184
It's like, it's not that great.

1162
01:27:07,403 --> 01:27:12,283
And so for us, it's like, yeah, like me said, I'll keep your Bitcoin safe during a loan.

1163
01:27:12,384 --> 01:27:15,423
But even when you don't need a loan, I'll tell you, like, take it to sell custody.

1164
01:27:15,543 --> 01:27:16,664
That's the best thing you can do with it.

1165
01:27:16,744 --> 01:27:19,403
Like, why would you keep it here if you don't have to manage a loan?

1166
01:27:19,664 --> 01:27:28,903
And so I think that the role even that banks fulfill today is just slowly shifting because some of that accountability is not coming back to the individual.

1167
01:27:28,903 --> 01:27:34,783
and uh and now you're really using them almost like on demand as people would use something like

1168
01:27:34,783 --> 01:27:44,983
and which i think is the more sovereign individual way of of taking it there right because um there

1169
01:27:44,983 --> 01:27:50,583
is no safety net that covers everything from you like there is no there is no op there is no

1170
01:27:50,583 --> 01:27:55,363
alternative to having some accountability and the more you try to deny that the more in trouble you

1171
01:27:55,363 --> 01:28:01,204
can get so i actually i'm really excited a about the competition and about the banks because i think

1172
01:28:01,204 --> 01:28:06,884
it actually and one it just continues to beam the spotlight on this big on this idea that bitcoin

1173
01:28:06,884 --> 01:28:12,003
back loans are great right like it's amazing and so when it ends up happening we've actually seen

1174
01:28:12,003 --> 01:28:16,884
this in our numbers so like say a new lender comes out that has a big megaphone and they're like yay

1175
01:28:16,884 --> 01:28:21,764
no bitcoin back loan is now available and so and so and so people are like oh bitcoin back loans

1176
01:28:21,764 --> 01:28:24,264
I'm like, who are the best places to go get a big amount of food?

1177
01:28:24,264 --> 01:28:24,884
Boom, let in.

1178
01:28:25,123 --> 01:28:27,503
Like, be the number one because it's been there for seven years.

1179
01:28:28,043 --> 01:28:31,783
And so you're like, oh, oh, these guys have been doing amazing.

1180
01:28:32,083 --> 01:28:35,804
And so our numbers actually grow because we get a lot of the coattails

1181
01:28:35,804 --> 01:28:37,463
off of some of these announcements.

1182
01:28:38,403 --> 01:28:39,043
A little free marketing.

1183
01:28:39,963 --> 01:28:41,244
In some ways, yeah.

1184
01:28:41,423 --> 01:28:46,564
And so, you know, like I said, I think this is going to be a very big table

1185
01:28:46,564 --> 01:28:47,523
with a lot of food.

1186
01:28:47,523 --> 01:28:50,583
and as long as we have a really nice comfortable seat,

1187
01:28:51,224 --> 01:28:52,943
we're going to do very, very well.

1188
01:28:53,304 --> 01:28:55,903
And there is no world where Ledin does well

1189
01:28:55,903 --> 01:28:57,344
and our clients don't do well.

1190
01:28:57,523 --> 01:28:59,564
We do well because our clients do well.

1191
01:29:00,043 --> 01:29:04,543
And so I think that there's going to be enough abundance

1192
01:29:04,543 --> 01:29:07,483
so that more than one lender can do very well

1193
01:29:07,483 --> 01:29:11,463
and we can do this thing right.

1194
01:29:11,463 --> 01:29:13,644
What I don't want, frankly, is another 2022.

1195
01:29:14,204 --> 01:29:17,503
I would hate to see a bunch of these other people

1196
01:29:17,503 --> 01:29:21,664
make the same mistakes and then us have to go out again for another two three years telling people

1197
01:29:21,664 --> 01:29:28,184
no i wasn't lending it was just these people and uh and so hopefully we're you know that that's not

1198
01:29:28,184 --> 01:29:34,043
gonna happen it's gonna be much more contained um but man it's a fun ride like i i i enjoy the game

1199
01:29:34,043 --> 01:29:40,903
right like i i uh i get to you know before bitcoin started i was looking at all these

1200
01:29:40,903 --> 01:29:45,664
these podcasts and following people on twitter and i felt like i was following you know like

1201
01:29:45,664 --> 01:29:47,443
LeBron James and Dwayne Wade.

1202
01:29:47,604 --> 01:29:50,144
And, you know, every day they get up and their job is to talk about Bitcoin.

1203
01:29:50,264 --> 01:29:51,344
Now, this is my job.

1204
01:29:51,943 --> 01:29:54,003
And so every day I get to put it on, right?

1205
01:29:54,083 --> 01:29:55,264
I'm out for Team Bitcoin.

1206
01:29:55,403 --> 01:29:56,224
I'm out for Team Letton.

1207
01:29:56,863 --> 01:29:59,783
And, you know, for me, this is a huge privilege.

1208
01:30:00,123 --> 01:30:02,983
And so I just want to keep doing this for as long as I can.

1209
01:30:04,123 --> 01:30:04,884
I love it, man.

1210
01:30:05,164 --> 01:30:07,764
And Maritza, this was such, I'm so glad we finally got a chance to do this.

1211
01:30:07,823 --> 01:30:10,403
I'd love to do this in person with you at some point as well.

1212
01:30:10,403 --> 01:30:11,963
We're going to have to make it happen.

1213
01:30:12,823 --> 01:30:14,363
Maybe we have time in Lugano.

1214
01:30:14,463 --> 01:30:14,963
Who can say?

1215
01:30:15,264 --> 01:30:15,363
Hell yeah.

1216
01:30:15,363 --> 01:30:33,344
That could be really fun. But seriously, like love what you guys are building. Love just like your general vibe about these things and the way that you guys approach it. And I hope this was helpful for people in terms of kind of separating like these, you know, the others from the Bitcoin companies that are doing things correctly.

1217
01:30:33,344 --> 01:30:37,983
Because I think that is still, that's a, you know, I told you before this, like that was a lingering kind of worry that I had.

1218
01:30:38,104 --> 01:30:40,744
But it's like, these are products that you want to exist.

1219
01:30:40,744 --> 01:30:44,644
Like lending is not inherently a bad thing.

1220
01:30:45,264 --> 01:30:47,943
It's just bad when it's done really irresponsibly.

1221
01:30:48,083 --> 01:30:52,023
And when people get out of, like, you know, yeah, like that's, you know, that's when things get bad.

1222
01:30:52,123 --> 01:30:54,144
But I want to be conscious of your time here.

1223
01:30:54,503 --> 01:30:56,623
Where can people go if they want to find out more?

1224
01:30:56,684 --> 01:31:00,804
If they're like, I need a, I don't want a loan from Jamie, you know, or a Bitcoin backed loan from Jamie Dimon.

1225
01:31:00,863 --> 01:31:01,863
He's not touching my Bitcoin.

1226
01:31:02,023 --> 01:31:03,043
Where are you going to send people?

1227
01:31:03,344 --> 01:31:07,144
So you can go to Ledin.io and it's pretty easy.

1228
01:31:07,403 --> 01:31:08,443
Signing up takes a second.

1229
01:31:08,623 --> 01:31:09,503
KYC takes a second.

1230
01:31:09,623 --> 01:31:10,123
We're regulated.

1231
01:31:10,264 --> 01:31:11,443
So yes, we have to do KYC.

1232
01:31:12,003 --> 01:31:14,583
But it's a pretty smooth process.

1233
01:31:14,844 --> 01:31:16,204
The loan application takes two minutes.

1234
01:31:17,804 --> 01:31:20,684
You get the loan proceeds typically within the same day.

1235
01:31:20,684 --> 01:31:24,583
If it's fiat, if it's a weekend, we can push it out on a Saturday because of banks.

1236
01:31:25,144 --> 01:31:30,903
But basically, most people get their loans same day, assuming you apply during the weekday.

1237
01:31:30,903 --> 01:31:39,783
and yeah it's pretty simple to follow me it's at cryptonomist with an a at the end on x twitter

1238
01:31:39,783 --> 01:31:47,043
and primal i'm mauricio at primal.net and my dms are open in every of those so anybody has any

1239
01:31:47,043 --> 01:31:52,664
questions feel free to come to me and yeah we're always happy to help don't go to jamie oh yeah

1240
01:31:52,664 --> 01:31:59,043
perfect note to end on thanks so much for your time appreciate it look forward to seeing you in

1241
01:31:59,043 --> 01:32:02,823
the flesh in Lugano. Same brother. Great to do this. Thanks so much.

1242
01:32:29,043 --> 01:32:36,844
podcast at primal.net slash titcoin on x youtube and rumble just search at walker america and find

1243
01:32:36,844 --> 01:32:43,583
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1244
01:32:43,583 --> 01:32:49,463
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1245
01:32:49,463 --> 01:32:58,023
podcast.net for everything else bitcoin is scarce but podcasts are abundant so thank you for spending

1246
01:32:58,023 --> 01:33:04,783
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