We officially have destroyed environmental FUD.
And that took like three years of data intensive,
systematic, cooperative Bitcoiners
like coming together and shitting on that FUD.
But with like the quantum stuff,
we kind of FUD ourselves.
So we're kind of shooting ourselves in the foot a bit.
Okay, well, I feel pretty confident
Bitcoin is going to take the market of gold.
Like it has all these properties that are just so much better.
A lot of people have probably been rotating
out of Bitcoin into other assets.
And that eventually there's going to be
some sort of rotation back into Bitcoin.
That's what we think can really start to spike things sometime this year.
And there's plenty of room within just that specific market of rotation to move Bitcoin's price, you know, to a thousand and beyond.
Bitcoin's gradual now.
And gradual is what leads to a suddenly moment.
Over the next few years, we'll look back on 2026 and be like, OK, that's when it started.
Noster is interesting because it's one of those things where I think that a lot of people just purely aren't going to end up using it until they really need to.
Or they're going to use it without realizing they're using it.
Like that's what we're seeing with BitChat right now.
Where it's like Noster is on the back end of BitChat to enable like the non-local side of the comms.
And like, you know, BitChat's got like a million monthly active users right now, which is wild.
Yeah.
But it's like it's a sign of the times, right?
Like you have to wonder, like did Jack, like, so Jack built it, then Callie ported it over to Android.
But like you have to wonder, like Jack clearly saw the writing on the wall.
Like it's been insane to see that kind of rapid adoption for that, just for a totally free, not harvesting your data app.
Like it's kind of like a, it's a, it's a beautiful thing really.
No, yeah, it's amazing.
And like a few points on that.
I hit on this point in our annual report when I'm talking about different forms of adoption and, you know,
where eCash could have like a strong distribution channel through something like that's a great
great um it's a great platform for it in our like protocol section of the report like that's one of
the key takeaways that we put out and like one of the things that I think a lot of the you know more
either like well-intentioned technologists of the crypto world believed in of like this fat
protocol thesis where you're gonna have a token and it's gonna earn fees because people need the
gas to use your infrastructure. And, you know, Chris Dixon, the partner at AE16Z kind of,
you know, pushed out like the read, write, own thesis around a lot of that. And it's like,
we're not seeing that happening. And now the data is kind of on our side. And, you know,
Bitcoiners for a long time just assume this intuitively because we think from a very
different perspective about the industry. And it just seems like some extra layer of
intermediation to have some new token. It's like, why use a new token? Why not use money?
and they're just like forcing you into an alternative form of money
that you otherwise would not use in the same way that like,
you know, airlines do that too with points
and all these companies that do it with points.
It's like, okay, so at best maybe these things are like point systems,
but you can really only do that if you're like an oligopoly
and crypto is just like too commoditized.
So we've seen like this race to the bottom in terms of like people using
the other crypto blockchains for settlement of different applications.
And what everybody's realizing now is, oh, wait,
it's really like the applications that matter
and nobody really cares about what blockchain it's on
and whatever is cheapest in terms of fees
and nobody gives a shit about any of that.
And if you have a good application that needs it as infrastructure
for whatever reason, then that's what we're going to see.
And that's a key point that we try to make to a lot of technical founders
is that in a variety of ways,
of like nobody really gives a shit about the infrastructure.
You need to make applications that are leveraging your infrastructure
in some sort of novel way.
And that's what's going to attract the users.
And that's what BitChat was.
And that's a huge form of adoption for Nostra's infrastructure.
And that's a really good thing.
So many things come at the app layer and like so much of the value
is coming at the app layer.
And it's like if we want to get that, if you want to have like other Bitcoin
layers be used then we need to have applications that are using it in a novel way that are going
to attract people without even knowing like oh this was the lightning network or we used arc or
we used something else um but yeah we wrote about bid chat in that form of adoption and and that was
one thing that surprised me as well um it was funny because like i remember when it was first
popping up like i i i love how much the human rights use case for it has made it go viral and
take off because when it was first popping up i was like oh like what's the most obvious reason
that i could see in like you know at least more developed economies for people to want to hop on
a bluetooth mesh network and connect with a bunch of people locally it's like finding drugs at
concerts i was like that would be a very viral use case for something like bit chat and and i
expect that that'll probably still happen but i love that it's not making its foray into something
that's more like you know socially critical and into something that's like very socially defensible
for why an application that provides freedom technology for people you know is needed around
the world in a very serious way no i mean first of all well said and i think it is it's a it's an
interesting kind of larger point here and this is i was talking with david marcus uh from light
spark maybe I think right before the kind of holiday break there and that was one of the things
that he was really focused on was like and that's I mean as you know you mentioned it you know that's
really what they're doing over there he's trying to figure out okay like we're using we're thinking
of bitcoin and bitcoin layer 2 networks as rails versus thinking about like we just want to make
stuff that people like it works better because it's using better technology it's using technology
on top of Bitcoin versus, hey, like we need people to quote adopt Bitcoin.
It's like they're going to adopt it whether they like it or not.
They're going to adopt it just because we're using the rails behind the scenes.
They don't even know about it.
But it's just a better experience with lower fees or faster settlements or whatever it is.
And I think this is just a really interesting point to be at because so much of the focus
on Bitcoin is on just, at least in the Western world, is on the store of value side of things,
right, is on, you know, just like looking at it as just an investable asset.
there's a lot less focus in the Western world, again, not so much in the global South,
on the medium of exchange side of things or on the payment rail side of things.
But these developments are happening. They're very much happening.
I just feel like a lot of people really aren't paying attention to it.
Is that kind of what your vibe is as well?
Yeah, yeah. So much of it comes down to like, what sources are you following?
What part of the media is it coming through?
But like these types of concepts, I agree, they really only come through in like the technical community.
and that was another big thing that we hit on in the report we had this whole section
called bitcoin media and we did that with fernando who's running marketing at blockstream
formerly now he has this new website called perception that's really really cool and he's
just doing a ton of meta analysis on like every form of bitcoin attention that exists and what
it's like across different media channels and how how can we think and like have creative ideas
around that. Like in the report, we hit in how massive the gap is between like the Bitcoin or
demographic who goes to Bitcoin conferences and listens to Bitcoin podcasts and what their current
perception is of Bitcoin based on that versus like some investor in New York who reads about Bitcoin
through like a BlackRock blog post or through general financial media and what their current
perception of Bitcoin is. And there's like this massive gap between people's perceptions based
off of that. And yeah, so like in the media section, when we're getting into a lot of these
things, that's like one of the narratives that we pulled out of it for the technical community is
when people talk about like layer two or lightning, it's like, that's just like this huge GTM trap.
Nobody knows what that means. Nobody cares what that means. If you're talking in those terms,
your market of visibility is the technical community. And that's not what's going to,
build your app for you. You need to be reaching out to general consumers or institutions that are
actually using this. And that's kind of the problem is because a lot of thinking around
these things has originated from us building the infrastructure, everybody still holds that frame
of talking about it from the point of view of the infrastructure. And I feel like we're going
through a shift where the market's forcing everybody to realize, well, here's what we
actually care about. And don't talk about things in terms of what your infrastructure you're using.
You know, nobody says like no guy is downloading Instagram because he wants to use HTTPS.
And like, you know, it's it's then that sounds ridiculous to us now because now we have this whole app layer built out and we know exactly why a guy downloads Instagram, probably because he wants to scroll through like cars and boobs and stuff.
And like that's the consumer motivation that you're looking at.
And and that needs to be applied more to Bitcoin companies is really thinking from that framework.
And yeah, I definitely agree with David's perspective on a lot of this because he brings kind of like the broader like tech learnings and culture into our industry.
And I think that's valuable.
Yeah.
So I was thinking about the way to structure this conversation just because I think there's so much stuff in this report to be able to cover.
And I was kind of wondering, you let me know what you think on this.
but I almost want to go through kind of some of the predictions that you guys put forward in the
report and use that as kind of the jumping off point for us in the larger conversations because
they're like it's a really I like that you started out the report with that it's like a nice way to
kind of okay the TLDR here here's what we think is going to happen now you can get into the meat
and potatoes what that actually means yeah first of all for people who want to maybe download the
report and read along if they're listening to this uh where where should they find this to be
to download it? Yeah, it's just on our website, epochvc.io. So that's E-P-O-C-H-V-C.io. You go to
the writing section in there, it's the one at the top. Okay, awesome. So yeah, if that sounds good
with you, let's start there because the very first line in that prediction section has a nice little
kind of tongue-in-cheek joke in it too for Bitcoiners. But the price of Bitcoin reaches at least
150,000 Federal Reserve notes, backed by the full faith and declining credit of the US government.
So starting off with the price prediction, bold, this is 2026 predictions overall,
there's quite a wide swath of them. But let's talk about that from a Vibes perspective,
because a lot of people right now seem to think they're watching gold run, they're watching silver
run. And I think people have two different reactions to this. One is like me, I'm saying,
boy, can you believe how many people are piling into gold and silver at what is going to probably
be a local top and you know wow uh shocking and the other people saying boy i'm about to pile into
gold and silver because look bitcoin's not doing anything what what's your read on this 150k i'd
say that's a i mean it's almost doubling from here uh but that puts you it's a pretty like
it's conservative to strong in terms of the prediction how did you guys arrive at that
so well what's helpful is for me to give the audience like context on my framework of thinking
around this and you know coming from like the traditional finance world um you know there's
like the saying that you know the only certainty you get from using any sort of model is that it's
wrong and and that's the case for like any sort of you know financial projection prediction about
the future in most things in traditional finance that are often viewed by people as a form of
science, like very fundamental forms of modeling, like capital asset pricing model or discounted
cash flow evaluations and all these different tools that are used by Wall Street guys to determine
like what the fundamental value of some sort of asset is worth. They're just an aggregation of a
ton of assumptions about the future. And it really like brings and I think what like the Bitcoin
community is called into question about a lot of things when we have these new assets trading that
have been so heavily criticized over the years. It calls these models that are viewed as a science
into question because for the first time we have very novel assets to now value. And then the
question becomes, well, what really is speculative? When people would criticize Bitcoin as being a
speculative asset, it's like, well, what is speculative? And speculative, I think, really
means in modern parlance to people what they're intending it to mean is it has a lot of speculation.
in it by some, you know, arbitrary consideration. Like we know that if a company has been producing
a significant amount of cashflow for decades on end, I'm much more certain that they'll do it
again next year than a company that's never done it before. And so like one might actually still
produce the same amount of cashflow in a year as like a startup and it'll blow up.
But it's hard based on the historical precedent to like, look at that. And, and I think that like
that type of framing of like what truly is something speculative is, I think it's important
to understand because in Bitcoin, when I was first introduced to it, I took my background in finance
with my undergraduate education. I was a CFA charter holder. So I got, you know, deepest into
this. And then on top of that, you know, with kind of like the deepest financial education outside of
like going into like PhDs or something that don't really matter in finance. But when I viewed
something like Bitcoin, I had this large background in my prior job in like valuation,
like valuing really esoteric things for like you're in like a litigation or something. And
you need to say in front of like a judge in a court, this is what the value of it is. And that's
like very precise and technical based on like the very precise technical theory. And I had a lot of
experience with that. And when I would think through all of that, and I first heard about
Bitcoin, like my first reaction wasn't like, oh, I hate Bitcoin, this thing's stupid.
I didn't understand it because it was pitched to me as like a blockchain technology.
And I was just like, I don't know, it's a speculative investment. Like it doesn't
produce cash flow. I don't, that's not the type of investing I do. I don't, I don't know how to,
you know, come up with a framework of assessing what it's actually worth,
and then whether or not it's over or undervalued. And that caused me to like write Bitcoin off for
years. And what gave me a good framework for doing that is really, I think it's, well, you need to get
deep into understanding the fundamental characteristics of Bitcoin. And when you do that,
and when you understand here are the fundamental properties that make it good, it is scarce,
it is, you know, highly portable, it's highly divisible, it's all these different monetary
properties that make something a good money. And when you get deep into that, you realize,
okay well what is the size of the market of money and then we've had a bunch of people in the
industry put out different versions of what those sizes are and if it you know consumes the market
of gold if it consumes the market of you know real estate to some percentage if it starts to
take a lot of share from stock stocks and bonds you know we can get into these really really big
numbers and all of a sudden the numbers just become so big when you think about it that it's
not even worth talking about. It's just like me deciding whether it's worth $80 trillion or $200
trillion really doesn't make a difference from here. All that tells you is buy it and hold it
for a long time until that happens. And once you get to that framework of thinking, which is for
the more technical crowd, that's a top-down analysis. You take a top-down perspective of
what's the total size? Let's think through these little details. Okay, we can get down to a smaller
version of that of like, okay, well, I feel pretty confident Bitcoin is going to take the market of
gold. Like it has all these properties that are just so much better. Sure. There's some segments
of the gold market that are distinct from Bitcoin. They are used in like electronics or for some sort
of utility, or it's used in jewelry, you know, and there's, it's not going to take all of gold,
but it's going to take some very large percentage of the monetary premium of gold of people holding
gold simply because it's scarce and they think it'll go up. And so that's like a pretty easy
bet to make. And it's just like, okay, let's make that. Okay. What are we looking at now on that?
We're looking at like a, what is that? Like a, you know, 10, 20 X here. I don't even know. And
now the gold's across 5,000, it's way up there. So it's like, cool. 10, 20 X just to take the
market of gold. And then there's a lot more to run after that easy decision. So that's the
fundamental framework. That's how I think about Bitcoin. And then what a lot of people in the
community do is they'll, you know, create these models where they say it must follow some sort of
law. And we've, you know, been through different versions of this over time. We had stock to flow
model and then people watch that break. And then, you know, people look at power law distributions
and, and it's not to say that there isn't like some sort of truth or indication towards it.
But I think a lot of people start to view these things as like a causal model. And just like,
know Bitcoin has like some characteristic that is tied to this variable. And it's probably tracked
it to a degree because of that. And if enough people start to believe that for a period of time,
then it starts to become this self-fulfilling prophecy. And then eventually that breaks.
Like you watch, that's like Robert Schiller wrote this book, who's like a Nobel Prize winning PhD
type economist guy, and narrative economics. And you kind of go into that of like narratives,
you kind of get this like fun time in the sun with a narrative and then eventually it will break
once it starts to become circular and people are aware that it's like this narrative and um
and that's kind of how i think about it with a lot of these models so like in the report
to like tie all that back to this you know question of how did we get to this prediction
um like i i never like believed in we have these like four-year cycles that are just going to
continue. At best, it's a self-fulfilling narrative. And eventually that's going to break
at some point. So we could say either it was at one end of the spectrum, spurious correlation,
it was just completely by chance that it started to follow halving cycles with its price. And
if you go to this website that we have flagged in the report, it's like spuriouscorrelations.com.
It's a really funny website to go to. You can look at all the different spurious correlations
that exist in the world.
And you wouldn't believe how many things
very closely track completely unrelated variables.
So like that's one end of the spectrum of thinking.
And then I think at the other end of the spectrum,
it's like, okay,
maybe there was a self-fulfilling prophecy in the narrative.
And then, well, okay, that's broken now.
So whether it's cycles never happened
or cycles are officially broken,
like the way that we're thinking about it now is
we're going to have this macro backdrop that's always going to be impacting things.
There's, you know, Luke Roman's making a case for certain like legitimate variables that could have happened.
It's not something that I view as primarily causal despite the historical liquidity correlation.
And like the reason I'll explain that is kind of based on our second prediction in the report after this $150,000 price prediction.
And that said, we predict that we'll look back on 2026 and say that was probably the year that Bitcoin started decoupling from either, you could think about it as its correlation with liquidity or just equities in general, how most people think about it, and risk assets broadly.
So that won't be obvious because it takes time. But sometime around like 2027, 2028, I think we'll end up looking back and be like, okay, 2026 was the year that that happened. And like the short version in the report is, I think that we have this shift happening right now, or that we've seen building over the years, and, you know, commodity adoption.
And we've had a variety of short-term forces that have been negatively impacting the price of Bitcoin. It's too hard to attribute what came when. But when you look at just how much mean reversion can ultimately happen, how much the analogy said in the industry is Bitcoin's a ball that's with air in it or a balloon underwater.
You know, like, yeah, it's eventually going to return to a certain balance.
If you kind of look at Bitcoin denominated in gold that story starts to look pretty clear And it looks like we just been in a bear market for a period of time And that the reality is if you believe in some sort of cycle coming out of this
we're getting close to about 400 days on this bear market when Bitcoin is denominated in gold.
And if you look at the historical cycles, it starts going up a lot after that. It's not really
the way I think about it. People want to look at it directly on a chart like that, but I think
about it from the perspective of commodities are getting a very strong allocation. Bitcoin has these
fundamental properties. A lot of people have probably been rotating out of Bitcoin into other
assets because of this. And that eventually there's going to be some sort of rotation back
into Bitcoin as they start to view those as maturing or they've reached the top of their run
or they start to say like, okay, we want to take a little bit of money off the table and start to
reallocate as like an institution. So like, I think like the gold rotation is going to be one
of the first dominoes where it's like gold's flying past 5,000 right now. There's going to
be a lot of people that look and they say like, everybody's going to be asking this question,
why is Bitcoin still down when we see the case of commodities increasing so significantly and
becoming so strong? And we have over a decade worth of data to look at that structural shift.
Like we know that this is a persistent trend in markets at this point.
So that'll be like the first shift.
And like, I think that that's what we think can really start to spike things sometime this year.
And there's plenty of room within just that specific market of rotation to move Bitcoin's price, you know, to $150,000 and beyond.
And then what we do after that is we go into, okay, what are like these pools of capital that are large and exist around the world that are also able to flow into Bitcoin for a specific reason like that?
So we go into ETF flows, we go into nation state adoption, we go into wealth management firms, we go into broader asset management firms, and we look at if they had certain percentages of allocation that started moving into it, what do those numbers look like?
And to the point I was making earlier about the market sizing of Bitcoin, the numbers are so large that it doesn't really merit discussion.
Like these things are big and people like to see them in charts.
Here you go, here's a chart.
and I think that
tying all that together
it's like okay
so what is like
the fundamental characteristic
that starts to make that happen
and the key thing we call out
in the report
is Bitcoin's declining volatility
that's this very persistent trend
where we can witness it
continuing to decline
and we're at a point now
where you know
Bitcoin is less volatile
than some of these major equities
that a lot of people own
you know like nvidia and tesla and like we have this chart kind of laying that out of how you know
the 2025 volatility of bitcoin was much less than those even despite its poor price performance
during that period and um you know and it's owned by like 12 percent of people within the u.s
we're estimating and like um and then you look at these other stocks and it's like that's like
that stock ownership is closer to like 60 percent within the u.s and it's like okay so people all
think like if you were to ask anybody like you would ask very serious institutional investors
um is bitcoin riskier than nvidia stock and they'll be like yes like the you know they'll
far and away believe that there's kind of like this perception gap where i think the data is
changing and bitcoin's volatility is lowering and it's actually starting to become a bit more of like
a safer asset than it once was uh from just like a pure volatility standpoint there's a bunch of
For people listening that want to give me a gotcha, there's a million other reasons why Bitcoin can't go bankrupt.
So it's actually way safer than companies that can go bankrupt.
But putting all that aside, just looking at the volatility of its price, I think that that shift will start to change things.
So what does that mean?
that means once people start to correctly assess the risk profile of Bitcoin as an asset,
that that's when I think that decoupling moment starts to happen. And I think we're going to see
a lot lower volatility. So this is the narrative in the report. We say Bitcoin's gradual now.
And gradual is what leads to a suddenly moment. That's the thing. Bitcoin's price getting boring
is exactly what sets it up for people to say,
oh shit, Bitcoin's really boring now.
Its volatility is a lot lower.
And well, we should be allocating
more of our portfolios to this.
And you look at the sizes of these pools of capital
where a nation state says,
if you're a nation state and you say,
why do I want to have gold over Bitcoin?
It's because it's got,
the capital markets for gold
are the deepest in the world
outside of treasury denominated assets.
And so if I want to go move $200 billion,
I can feel very confident that moving that
in a gold-structured product of some sort
is not going to move the market.
Whereas you go try to move $200 billion in Bitcoin today,
we're talking about 10% of the market capitalization on that move.
So that makes it a lot less attractive to these guys to put it in.
And so lowering the volatility of it,
I think, is something that actually comes from
it just simply gradually growing over time,
having lower volatility, saying,
okay, this is a bit safer, it starts to get bigger.
okay, now we're not going to move the market as much. And this is something that can actually
serve as more of an alternative of gold to like large sizes of money. And that's like the
inflection point, I think. Like I think if Bitcoin gradually grinds up, say, 2 to 4x,
and we get into the like, you know, 150,000, 250,000 range, now we're talking about a capital
pool that the addressable market for people who own gold has just probably not just doubled,
but because it's a long tail, like the market of like who owns gold, it's like the biggest
guys own vast majority of it.
But quantity wise, most people own much smaller amounts of gold, most nation states, etc.
So when you double the liquidity of Bitcoin, now there's a bunch of people who are like
expecting, oh, well, I want to sell 10 billion or 20 billion.
And when Bitcoin was a $2 trillion asset, that didn't make sense.
Now that it's a $5 trillion asset, it's starting to make a little bit more sense.
So I think that there's like multiples in the market size that it can actually increase that are like now addressable for it as a reserve asset.
And that's what leads to this like decorrelation and decoupling and like a suddenly moment over time.
So like that's kind of our prediction.
And we kind of see like we see it moving up in 2026 and it's probably just going to be like a boring gradual.
Like it just starts to continue to move up.
Maybe it hits that inflection point then, but I think that whenever it does hit its suddenly moment over the next few years, that we'll look back on 2026 and be like, okay, that's when it started.
And it was because it was so boring that it actually started to make sense for a lot more people to put money into it.
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Okay, so, and I appreciate that background.
So to make sure I understand this, you're actually saying basically like the gradually leads to the suddenly.
You're not necessarily saying that Bitcoin is going to have diminishing returns in the long run.
more so that its volatility has been decreased to a point now where it looks like, quote, stable,
right, to a lot of investors. And that that, in fact, then leads to, okay, it actually has
incredible upside potential, because now more capital is flowing into it, because more capital
feels comfortable flowing into it, the liquidity increases in the total market. And that sort of
is just this self-perpetuating cycle that eventually just leads to like that suddenly moment. Is that
Is that fair to say? And so you're not on the diminishing returns thesis. You're just saying it may look like that in the short term. And then you get that point where it's that inflection point. Is that my understanding correctly?
Yeah, yeah, yeah. I think that's right. It's like, I think Bitcoin is having diminishing returns within the current perception of it, of like, if you think of the entire universe of investors that are focused on Bitcoin today, which is a very small percentage of the total like investor world, within that it's having diminishing returns.
by becoming more gradual, becoming more boring and having more like stability in price,
then it starts to open up what other like investors are looking at it and why.
And maybe not even the investor themselves, but what bucket they're putting it into.
Because like so much of this is driven by narrative.
Like you go to an asset management summit or you go talk with family offices and you
learn how a lot of these investors are thinking.
It's just the reality is nobody has time to know everything.
and most of what they're doing is they're listening to narratives
that they hear in different places.
And the second, a bunch of data, we have like a consistent amount of data
that says like, well, look at Bitcoin.
It's starting to, you know, its volatility is significantly lower.
It's, you know, up 100%, 150% over the past year or two,
$3 trillion market cap asset.
If you were just like, oh, interesting, is this thing a risk hedge?
I mean, the second Bitcoin is viewed as a risk-off asset, like truly,
that's when I think things really start to change.
And that's when a lot of people are like,
well, we should at least put like 2%
into something like this
because that's what we do with gold.
And Bitcoin is probably just like
a higher return version of gold.
So that kind of brings us
into the next couple of points here,
which is one or point number three
is Bitcoin rises at least 50% in gold terms
from a Bitcoin rotation trade.
And then the next one is a major asset manager
adds a 2% allocation to Bitcoin in its model portfolio.
So do you think those kind of go,
I mean, do they go hand in hand a little bit
where it's like people start to realize
as Bitcoin catches a bid,
like I guess does the Bitcoin price movement versus gold,
do you kind of see gold moving a bit stagnant?
Like, do you think this is as high as gold goes for a while?
And then it kind of levels out,
Bitcoin starts doing the moving
and then people realize,
huh, there's a rotation,
again, like self-fulfilling prophecy.
It's like rotation trade is happening.
We should get in on this.
We should add this to our model portfolio because we've seen what it's done in other model portfolios.
You know, if you added just like a one to five percent allocation over five years, like it helps your portfolio drastically.
Is that kind of how you see that playing out?
Yeah. Yeah, exactly. Like, you know, I think gold's going up.
I think gold is a good asset for the reasons I just described and people are going to continue to view it that way.
I just think that if you like when you view a market from the perspective of there's a market is the aggregation of, you know, millions of different perspectives.
When you view it from that perspective, it's like, OK, so with any market, with any owner of something, there's some there's some marginal group.
There's some group that's like right on the edge of that market.
They're like, yeah, we own this. But like, if Bitcoin was just, you know, a little bit bigger or a little bit less volatile, we would shift out of it.
You know, when you think about it from that perspective, there's some marginal group of sellers that could move out of one market and into another.
That's kind of how we're viewing it.
And to your point on like the model portfolios, like, you know, we put this chart in there that's showing the market sizing of some of that.
And it's like if you look at, you know, some of these like major large wealth management firms, Morgan Stanley and the like, they have like a range of recommendation around Bitcoin allocations.
it kind of varies across all of them. And we put this chart and says, if you took all the low ones
and then you took all the high ones for each one, here's kind of based on how much they're managing,
what that would look like across their client groups and how much would flow into it.
And even on the low allocation, it's like 400 billion. So we're talking about multiples greater
than ETF AUM. And that's just a recommendation. But if some of these large firms put it into
what's structurally a model portfolio where they say, you're a new client onboarding,
here's where we're going to start you off with in this structured portfolio it's like the default
template and then based on what we talked to you about you know we'll finagle what we actually
want to do with it and um so like i think having that shift of like bitcoin moving from just
recommendations within these firms to being in like a modern portfolio that's that's going to
be a very major shift and like the capital size of that's massive no no i mean it like when you
look at the actual amount of money that is sloshing around out there like bitcoins now
under two trillion dollar market cap starts to look comically small when you also understand what
bitcoin is like it's and to me eric where i'm at with this right now is it and this is like a drum
i've been beating is just that it seems that there's a huge information asymmetry right now
for those that get their 40 hours per week of bitcoin podcasts and are and are paying attention
and are in the know you know and have been following this closely maybe you're a little
bit disappointed by bitcoin's price action right now especially when you watch the gold bugs and
and the silver simps dancing on Bitcoin's grave.
But at the same time, the fact that that is happening
and the fact that Bitcoin is kind of languishing right now
a little bit in this 90 to 100K zone,
to me that just signals that like,
wow, we are still so crazy early
because the vast, vast majority of people
have no idea what we're talking about here.
They have no idea because if they did,
they'd be piling into Bitcoin, but they're not,
so they don't.
And so to me, this just seems like,
whether you're managing a ton of money
or you're just a pleb stacking for yourself and your family.
To me, this just feels like one of those opportunities
that you're going to look back on in four years, five years, 10 years, 20 years,
and you're going to be like, wow, either thank God I was stacking like a psychopath
or dang, I wish I would have been stacking like a psychopath.
Oh, totally.
Yeah, I mean, you think about, I remember in like the depths of the last bear market
and when we were getting close to like 20 to 15K,
and that was like really the first time when I was just like gung-ho,
like, yeah, like, thank God it's this low. I can't even believe it's this low. And then you look back
on that and it's just like, thank God I, you know, put my money into Bitcoin at that point in time.
That was huge. That impacted my life significantly. And yeah, I don't think it's that long until we're
just like, remember Bitcoin at 90K? Like those are fun times.
No, it's true. And I want to get into a couple of these other points too, because the next two are
kind of related. And it's around treasury companies, which have been a, let's say,
contentious topic. So the first part here, point number five, is about MetaPlanet achieving its
highest MNAV among other Bitcoin treasury companies. And you're going to see market
cap greater than a billion. And then after that, an activist investor or competitor liquidating a
Bitcoin treasury company, capturing the spread between its MNAV discount and the value of its
Bitcoin. So can we talk about that a little bit? Because the first point around MetaPlanet,
I think is interesting. The second point is perhaps even more so because it's been one that
people have been kind of theorizing about a lot, like, okay, now that these companies are trading
at a discount to MNAV, wouldn't it make sense to somehow, you know, be able to extract that Bitcoin
from there that you're basically getting on sale? So how are you guys thinking about this? What,
you know, maybe we can start in the meta planet point and then kind of get into the larger, like,
hey, which company's getting, or maybe not which, but why would a company get liquidated at this
stage. Yeah, yeah. So we had the I think the quickest way to describe the MetaPlanet one is
just MetaPlanet is the only Bitcoin treasury company right now that has like an operating
income. When you think about like the pure play Bitcoin treasury companies, all the other ones
have expenses because they're paying people. Strategy does too. Strategy, it's so big that
Its expenses are like a very small percentage, you know, a few basis points of, you know, the amount of Bitcoin they have every year.
But MetaPlanet's been consistently applying a strategy that actually earns like a direct Bitcoin yield on their stack.
And they're doing different derivative strategies and things to do that.
And they're generating a large amount of income from it.
So that offsets the cost of all the people they're paying to run it.
And not only that, it actually grows the amount of Bitcoin that exists.
And it's the only one doing that.
Some of the other ones like Nakamoto and Striva.
Besides strategy.
right um well strategy is not generating like a direct yield yeah like strategy is not like
like they're not selling like covered calls on their bitcoin stack or anything like that
they do have their obviously they're still operating business like in the traditional
sense though where yeah i see what you're saying yeah yeah yeah and i i i would presume i haven't
looked at that number but i would presume that their operating business income would still
probably not offset these costs, but I could be wrong about that. Because the operating business
is like so small within the company that it doesn't really move the needle. But maybe it does.
I'm not sure. But I guess like, so of like the pure play characteristics, though, earning a Bitcoin
yield is what MetaPlanet did. And not only that, but if you look at like who started with X amount
of Bitcoin and then how much they grew it over the past year, like strategy, you know, on an
absolute basis, obviously got the most Bitcoin. But like Metaplan on a relative basis year over
year grew its Bitcoin stack so significantly. So like they just, they just crushed 2025.
And, and I think that it's like, if you're running a pure play treasury company, there's just like a
lot of things that they've got going for them that make sense with like the tax environment,
et cetera. It's like, okay, I see the model making sense here. They're offsetting their operating
income. Some of these other treasury companies like NACA and Strive are spending like a ton
of money and their operating costs are really cutting into the Bitcoin.
So we'll see if that changes.
We'll see what happens.
You know, I'm sure that they have a ton of different plans, but yeah, we were like, okay,
Metaplan is kind of crushing it.
They doing a good job with that So then I guess the next question there would be and I appreciate the explanation the next question would be just around a company getting liquidated by either
investors or a competitor yeah yeah so okay so like um
the the theory the you know like there there's a difference between like as an investor of any
strategy between like what theoretically makes sense on paper and then what you can actually
execute in a market. And that's because markets are dynamic. They change based on new information
at any point in time. So if like an activist investor, for example, they want to be really
quiet about what they're doing until it's time for them to do it because they don't want to start
signaling markets and doing different things that are going to change it. So if, for example,
an active investor wanted to get a position in a treasury company and accumulate that gradually
over time, and then they wanted to signal to the market that they're going to have some sort of
hostile takeover of it, and they're going to run a public campaign to get shareholders to vote on
behalf of what they're doing to just liquidate the Bitcoin. They'd have to be very quiet about
like not signaling the market and like the actual execution of it's something that's just like,
you know, it's something that billionaires do and it's a hard thing to do. And like,
so, you know, we'll see. It can also be something that is just simply an acquisition by one of the
other treasury companies. But to really capture the spread from what you're doing, you need to
have your position before the market's aware of your position, or you need to have some sort of
agreements like off-market terms that shareholders are voting for. So that just all gets like really
complicated from like a governance and execution standpoint. So like that's kind of my caveat with
it is we think it's probably going to happen, but we do need to see depressed discounted
valuations of the equity relative to the Bitcoin stack for a period of time and somebody's actually
got to execute on it right um we could have bitcoin rally in the next month 40 and all of a
sudden expectations of the market changes and everybody's like okay these bitcoin treasury
companies are going to be you know moving into a much easier environment for capital raising now
and uh maybe some of the treasury companies that haven't been able to issue a form of like credit
or a preferred equity structure that allows them to fix their cost of capital because that's a key
variable, right? Like if you can't fix your cost of capital, then it's just like a circular machine
of equity raising and diluting. So you need to be able to fix some portion of your cost of capital.
And there's like only a handful have been able to do that and nobody else really has. So
for the companies, the market might start assuming, okay, now that it's moving back up,
I bet these guys who weren't able to do it last year, they're going to do it this year.
and then maybe it goes back up to a premium because of that.
But so I think it's like it needs to,
the price of Bitcoin will need to be low enough, long enough.
And I expect that if that were to happen,
it would probably happen like early in the year
because I think Bitcoin's going up.
Me too, for what it's worth.
Okay, no, I mean, it's going to be interesting to see
because obviously these, the treasury companies,
and I was just talking to someone today about this,
just this idea that maybe the blow off top was actually in treasury companies.
I was talking with Nico on Bitcoin.
He was talking to Mauricio DiBio about it.
And I thought that's actually an interesting thesis that like we didn't get the same kind of blow off top from retail in Bitcoin because there was a blow off top in equities.
I don't know if you have a take on that.
Yeah.
Yeah. Okay. So the way I think that it did happen, saying to what degree it happened is another question. But the fact that companies are able to raise capital on a premium to their MNAV and buy Bitcoin with it means that people are paying more potentially per unit of Bitcoin.
and like we've kind of witnessed that there there was like a bit of you know it was like a bit of
like a dumping on retail effectively through raising on a mnav premium so like that's people
got less bitcoin for their money and that probably drove less relative demand into bitcoin and more
of that kind of either went into the pockets or is earmarked for future bitcoin capital
deployment within some of these treasury companies um and you know i i don't know what to say like
which one it was or to what proportion. But yeah, so there is theoretical justification that like
buying paper Bitcoin that is more expensive than Bitcoin itself did cause less demand for Bitcoin,
had it all flown through like spot markets. Right. Now, I thought it was an interesting
kind of thesis around that. So I wanted to get your opinion on it. The next point here is number
seven, which is that a Bitcoin company receives conditional approval for a federal bank charter.
This would actually be a huge deal.
Can you talk about that a little bit?
Because I think this is something that maybe if folks haven't been paying attention, they're not aware of kind of like some of the history here and some of the just like shenanigans in general.
Can you talk about why this would be so kind of impactful?
Yeah, yeah.
I mean, there's a long history and it kind of depends on there's a ton of nuance.
And with, you know, my operating partner at EPOC, he has a law degree and he does most of our legal research on everything.
And if there's one thing I've kind of learned over the past year working with them directly on a lot of these regulatory questions is that things are much grayer.
There's a lot of gray area in terms of what could happen and when it could happen and how to interpret the law, et cetera.
um so i i think that like the the big thing that we're getting at with this prediction is um
conditional approval isn't like you're going to get a bank charter it's a nod that
directionally speaking uh we want to give you a bank charter and we need to do more work and
research and let's move forward on next steps because of it so it's like uh what happened
And last year was there is a Peter Thiel-backed company, Erebor, that is trying to become like a modern bank for tech companies with a federal bank charter.
And that receives conditional approval from submission, from the point of submission within about, I think it was like three or four months.
So that was big.
That was a really big news.
And it's more like we see that Bitcoin company, there's a lot of Bitcoin companies that are going to start thinking this angle.
And it's like, OK, well, if some are reasonably backed with enough capital, then they can pursue something like this.
And it makes sense that from the point at which they would submit for a federal bank charter that they could see a conditional approval for it.
And a lot of the history at like front and center was like Caitlin Long fighting the Biden administration to get a Federal Reserve master account.
and um and and you know there's a ton of history and lore around all of that but it's like i mean
the whole view i think right now is get well again is good because the current trump administration
is creating a favorable environment for things like this to happen and i think that that really
greases the wheels on whether uh that'll happen within the next year but i i think we're kind of
on the edge of it okay and yeah that uh that leads into a little bit of a couple other points
down the line here, but I will keep going in order just to feed my mild autism here to
jump out of order. So the next one is around stable coins. I think this is an interesting one.
So a stable coin uses Bitcoin as a reserve asset to pay interest to its holders offshore. And I
think that offshore part is probably key because that also feeds into one of the later points there.
But can you talk about that a little bit? Is the reason for the offshore because in relation to
the Clarity Act not passing, which is a couple of points down the list.
Yeah. Yeah. So I'm a little bit more familiar with like some of the details around it. And like,
basically, we had the Genius Act pass, which was stablecoin specific back in the fall of 2025.
And the two key things that I really viewed this as, and this has become, we wrote this banking
report deep diving into a lot of this stuff back in the fall. You can find that on our website as
well. But the now this is since Brian Armstrong went public on his disagreement with the Clarity
Act, that has brought a lot. It's like it kind of illuminated in a lot more people's minds what
happened with Genius, et cetera. And really like what Genius did is it just created this regulatory
ring fencing for banks. And, you know, there's like public letters that were written. There's
like a and you kind of feel bad because like community banks are like kind of like the good
guys, I guess, in the banking world. They're not like the JP Morgans and, you know,
bulge bracket type guys that are, you know, run by reptile people, et cetera. So like the community
banking association like sent this letter and they're just like, look, like if you allow stable
coins to get a Fedmaster account, then our business is done. So don't do that. And that was
kind of like this regulatory ring is an example of like their internal thinking of this is a better
technology and creative destruction from it's going to put us out of business and we finance
so much of your political campaigns like you know you owe us and uh and we're going to give you more
if you keep it this way so there's that conflict of interest that i think is driving a lot of it
but like genius said stable coins are not allowed to pay interest to their holders and um they have
to hold like short duration government treasury assets as reserves and nothing else and um and
And one of the areas that Clarity from that wanted to provide clarity on is if you look at a company like Circle that has USDC as their stablecoin they're issuing.
Circle isn't even like a company.
They're just like Coinbase's little bitch, basically.
That's the best way to think about them.
And they really just do all the boring stuff so that Coinbase can then be like, okay, Circle is going to have a stablecoin.
It's not going to pay interest on it, but we can pay interest on the stablecoin and we can have that passed.
And like that's kind of how the market was planning on structuring everything is the exchanges are going to end up distributing it through their own interest.
So it's like if you read the regulatory section of this report, which is one of the best sections, particularly for people that are a lot deeper into this industry.
My operating partner, Vijay, wrote it.
He's a brilliant guy.
And he goes into these details. But we have this little graphic where we basically took when we wrote our banking report last fall, we had, you know, we start the report talking about our banking system structured is a two tier banking system.
And, you know, that's the conventional way that people think about having a central bank that is pushing reserves into the banking system.
Then you have regional banks that are also plugged into the banks that have Fedmaster accounts that are plugged into the Federal Reserve.
And it's this like multi-tiered system that allows money to like kind of get pushed through all of it.
we like took this graphic and we're like, okay, so if we have this two-tier banking system
and you think about how the distribution of money works through it today,
and then you say, oh, well, crypto is like this new future.
And it's like, really what Coinbase is trying to create is at the top, you have the central bank,
and then that's tier one.
and then tier two is you have all of the commercial banks
that plug into it with a Fedmaster account
and we like scratch out central bank at the top
and write circle.
And then in tier two banks,
you scratch out like bank A, we put in Coinbase.
And it's like, all they're doing is taking stable coins
and recreating a multi-tiered structure
that's arbitrarily intermediated
because of some form of regulation within the system.
So, and it's like, welcome to the future.
And like, we kind of are facetious in the graphic about it,
But it's just like we are very directly kind of recreating it because of arbitrary regulation.
And yeah, so I think like that's kind of like the background on what I guess is like really happening with all of this.
And then it like came into question around the confidence of like, okay, well, you know, are these things going to pass, et cetera.
But like not going into any of that.
But, you know, I think that like the way that we're viewing this is like, and we wrote about this in the banking paper is, you know, everybody knows that stable coins are better.
Like that's like the elephant in the room with everybody.
And everybody knows that the bank lobby is preventing this from happening.
And the question's like, OK, well, if it doesn't happen in the US, then where is it going to happen?
And I think that's like when Saylor was hitting home on his Stretch product and he's down in Abu Dhabi and he's telling all the sheiks, he's like, hey, somebody should do this.
And if you want to lead the world, there's a huge, huge opportunity here.
And we completely agree that the concept of using Bitcoin as reserve capital to have an interest bearing product that's lower risk for people.
it's it's like it's a very marginal way of getting more people into the industry and like stretch is
like this proof of concept that's kind of proving it out but it's limited right because stretch
exists within a brokerage account um now there's a reason for that and there's a reason it was very
successful to do that but like a stable coin something that has a lot more utility than just
an account that sits in your brokerage account and and like that big idea of like okay well
if I am a stable coin company, if I'm Tether and I have X amount of reserves that are in treasuries
and I earned, you know, four or 5% on that. Um, and I could pass some along, some of that along
to people. And like, if, if Tether just owned treasury securities and did that,
now we're talking about like what banks should be doing. Now we're talking about,
you know, like that's what a bank should be. That would be a healthy banking system where you
actually got like three or four percent from your money that you have in the bank and but that's not
what they're doing to actually have like you know other you know uh reserve assets in there and like
we definitely see a world where like bitcoin is going to move into the capital markets through
the reserves of other products that are meeting people where they're at today and and that's what
sailor did is he took it to the other extreme very immediately and he said no let's just like put way
too much Bitcoin backing some sort of product that's paying interest. And it's very easy for
us to do that. And now we have a product that everybody wants because it's very low risk. It's
paying a higher yield. And that's the belief. It's just like, okay, so Bitcoin is going to grow
at whatever, 30, 40, 50% compound annual growth rate every year. And you can guarantee people's
10% yield over time from having a reserve construction that supports that. Now we're
talking about a systematically superior form of savings to a treasury security, to which Bitcoin
would respond, well, why wouldn't you just own Bitcoin directly? It's like, well, because people
are too stupid to own Bitcoin directly. They need this. You have to like, if you want to feed your
dog some sort of healthy thing, you got to wrap it in a treat that it is familiar with. And that's
literally what we're doing. We're like force feeding Bitcoin through financial products that
people are familiar with. So that's kind of our prediction around that is the US regulatory
environment isn't doesn't like doesn't provide the ability to really do this effectively um and
it's going to emerge somewhere else in the world and tether doesn't because tether is so dominant
doesn't necessarily have an incentive to do it yet they just get to pocket all the money good for
them i hope they invest in us one day and um but at some point they probably will as the competitive
environment starts to emerge i love that analogy with the dog that's yeah it just came to me so i
I haven't used that yet.
Yeah.
No, no, it's good.
I mean, it makes a lot of sense.
Like that's the reality too.
And I think we talk about this as Bitcoiners a lot.
It may not always be the most popular viewpoint,
but it's like most people aren't going to do self-custody Bitcoin.
Yeah.
It's just, you know, I'm not saying that that's a good thing.
I'm just saying that that's the reality.
Like, and they don't necessarily need to.
Like that can be for us.
Like I'm going to keep doing it.
You're going to keep doing it.
A lot of us are going to keep doing it.
And a lot more people will do it.
But to think that like, you know, the majority of people are going to do that.
I don't know.
Like, I don't even think it matters how easy you make that process.
Yeah.
I think still just most people don't want to have that kind of radical ownership and responsibility for what that also implies.
You know what I mean?
Yep.
Yeah, I agree.
And like the framework that I've kind of written about in the past around it is just like the when you people participate in something when like the marginal cost of participation hits some sort of threshold relative to its benefit.
It's like there are certain things that people have spent a lot of time getting good at or learning or, you know, becoming part of their life because of how they view the benefit of it happening.
So like personal computing for people to learn how to type on keyboards, how to operate in a computing system.
Like there's so much education we all have.
And, you know, and like our generation have had since a young age to be able to do that well.
And and that was because participating in the Internet was such a valuable thing.
I think that the reality is today for the vast majority of people, it just doesn't matter as much.
But what I think is like they don't they don't see the reasons to do it because they don't know or they aren't, you know, being tracked by the FBI or being, you know, they're just not even aware of it.
And like. So it's just like, but who is going to do it?
And I think I think when you think if you think about it in terms of like the volume of people, it's going to be a lot less in the near term.
But what I think when you think about it in terms of the volume of capital, self-custody is actually going to be a lot higher because people who have a lot of money spend a lot of time thinking about these things.
How do I keep control over it?
How do I keep it private?
it. And I think that when Bitcoin is a $20 trillion asset class, the proportion of actual
capital of it that will be held in a self-custodial private manner at that point, especially when
we have much simpler tools, I think that that's going to end up being a lot higher than people
expect. I think nation states are going to want to control it for themselves. It makes sense to
pay for an in-house operations team to manage that through. And you can see a lot of other
large scale institutions where they stand to gain quite a bit from actually learning and bringing
these things in internally for their own control. I agree with that. And I think it's actually a,
it's a good point that like the people who are power users aren't necessarily just going to be
individuals, right? People who really want to benefit from the radical properties that Bitcoin
has in terms of it's like truly being unconfiscatable private property. Like that's
going to especially be people who have a lot of, you know, property that they want to keep to
themselves. So I think that makes perfect sense. It's like, you know, Swiss bank accounts are
viewed as this luxury because it's like something that like fancy rich people do, you know, and
that's kind of the idea of a Swiss bank account. And like, and that was because it provided them
certain properties. They were the power users that were like, okay, well, I want to have as
much anonymity and control over my assets without, you know, whatever risks that could be occurring
for people trying to control my assets. And I think a similar thing's going to end up happening
with Bitcoin. So I want to keep moving down this list here because there are a bunch of really good
ones to get to. Some of them we sort of covered already a little bit, but one that we haven't.
You're mentioning Tether a little bit, and they're obviously working with Jack Mallers with 21 Capital.
Your number nine prediction is 21 Capital acquires Strike. Do you think that happens?
Does Strike go public before that? Or do you think that that's like I can see that happening,
but I want to know does strike go public first um hmm I hadn't thought about that I don't
I don see why I think they should buy it and um because Jack I just from what I seen Jack say publicly on 21 it just like oh okay yeah he gonna buy strike it would make a ton of sense for them to do it like one of the things
that we wrote about uh a bit more in depth in our report from last year not our annual report from
this year was just like the fundamental reasons for uh what is like good or strategic for a treasury
company. And one of the big things we wrote about is like, treasury companies that are like, okay,
we want to build out an operating business. And it's like, okay, well, what business?
An operating business is just any sort of business, right? So it's anything other than
managing assets, really. And do you want to make ice cream? Do you want to open up a pet shop?
There's a million things that you could do. How do you choose? What's the best one?
And I think that the best way to think about it is, well, what business, what type of business
needs Bitcoin? Because you're already something that has a lot of Bitcoin.
So what type of business needs Bitcoin more so than others? And that's mostly a financial
service business that requires liquidity. Because what they have to do today when they don't have a
lot of Bitcoin and they say, okay, well, we need some other person who has a lot of Bitcoin to
fulfill that. And oh, that other person is going to charge us X percent fee to say like one of our
customers wants to, you know, move the, they want to move a million dollars cross border in Bitcoin.
And we'll say, okay, that customer just wired to a bank account that the company controls a million
dollars. And then what we're going to do is we're going to swap it for Bitcoin. So we need some sort
of liquidity provider who's going to come in and give the Bitcoin, send that Bitcoin to another
country where there are immense payments going. And then on the other end, somebody has got to say,
okay, we'll buy that Bitcoin back, swap it into a bank account at the other end, and then you get
the foreign currency or the domestic currency in the foreign country on the other end.
So you have like these different components of people that are providing Bitcoin liquidity
within a lot of financial service businesses.
And that's just like one example for a remittance payment company.
And, you know, Strike does things like that.
And I'm sure that they could do quite a bit of other things.
And I think that that seems like a very natural thing, obviously, with Jack being at the head
of both, which would be sweet.
I think that that would be really good for our industry too,
particularly for us being in venture capital,
because it shows that there's,
there's value and we'll see just like what the value is of a lot of these
Bitcoin businesses.
Because those are very young.
We have a whole like venture capital section going into like Bitcoin
businesses and what that kind of means.
And I think one of the,
the interesting things is like,
there was actually a lot more like financing and crypto businesses.
It started a long time ago and the Bitcoin ones are all like much younger.
So like right now it's kind of like the value of these businesses is still being proven out.
Most of them emerged like 2021 and onward.
And yeah, so I think it'd be really cool for the industry too.
And we were being a bit like kind of like calling it out directly was just kind of like a fun thing.
But I see it happening.
I like it.
You're kind of forcing the hand a little bit, right?
Just making it self-affirmacy.
Do it, Jack.
Do it.
Yeah, do it.
Okay, so the next couple points here, we've sort of touched on them already, so maybe we can just – we'll just go over them lightly, but it's point 10 and point 11.
The first one is the Clarity Act does not pass, but even if it does pass, it's not going to be the end of the fight over stablecoin yield.
And 11 is then the substance of the Clarity Act, which is asset taxonomy and allocating authority to the SEC and CFTC, will be accomplished via SEC rulemaking and guidance in 2026.
so I mean you touched on this a little bit already this is basically saying I
mean even if it does go through like most of any meaningful kind of movements
here are gonna be done just by SEC rulemaking at the end of the day anyway
yeah yeah that's that's kind of what he's getting at and like by these two
predictions are from like our regulatory section that BJ wrote and but yeah yeah
that's that's the gist of it is that a lot of these things can be accomplished
via other regulatory bodies.
And there's just so much gray area within all of this.
Yeah, we don't have to dig into those two duplics.
We did kind of cover them already.
And I do want to get to the next one,
which is a juicier verging into the political realm
a little bit more here,
which is that Republicans, this is point number 12,
Republicans will lose the midterms
and there will be meaningful anti-crypto regulation
or regulatory blowback,
most likely in the form of consumer protection.
so i mean this is something that we like we've all been kind of talking about too it's like okay
yeah the trump administration is favorable towards bitcoin and crypto very favorable towards crypto
as we all know but obviously the pendulum swings back right so is this basically you think this is
going to be primarily just a kind of reactionary thing for the left to sort of distance themselves
from what they see as sort of the let's say the impropriety of the trump administration's stance
on Bitcoin and quote crypto.
Can I call Vijay right now and have him answer that?
I think he'll have a really good answer for it.
Sure, why not?
Yeah, okay.
I love it.
I've never had a live phone a friend on the show before.
This is the Bitcoin podcast first.
I love it.
It's going to be super awkward if he doesn't answer.
Yeah, I know.
I know.
He shouldn't be on a call.
Come on.
oh man
suspense is killing me
I don't know
um
okay let me let me message him and see
but uh yeah so like
that that's pretty much how
we're viewing it but I think oh here he's calling back
here we go amazing
Vijay
I'm on a podcast right now we're live
and we're going through the predictions
that you put into the report,
and we just got into the Republicans losing the midterms
and all of that one.
So I've got you on the mic.
Give the 101 on what you're thinking about that.
Yeah, I mean, so I guess them losing the midterms,
I think, is probably driven by non-Bitcoin,
crypto-related things,
but just you can see their popularity slipping.
I guess the only hedge on that is like Democratic,
Democrat popularity doesn't seem to be picking up in tandem, but, you know, there's so much chaos.
It feels like that, you know, at the very least losing the size of their majority or their kind of dominant sway at the moment.
And I think the likelihood, I guess the main prediction we had in there on this was that there would be some kind of backlash
against, you know, the Bitcoin crypto voters that I think some of the Democratic Party sees as part
of the Trump coalition. And I think, you know, some of the Trump administration's activities
since he's been inaugurated haven't really helped in that regard. I think some of the, you know,
Trump coin scammer seeming stuff, I think will invite, invites back in a lot of skepticism and
potential, you know, regulatory scrutiny that we may have moved beyond as an industry.
I think the mitigating factor will be that a lot of the right now folks that Trump has
installed and the agencies and the kind of administrative strategy of most of the enforcement
arms of the government has shifted to a more positive one.
I think that will be hard to pivot.
But I suspect at least like in Congress, you know, as we have a new class of representatives and senators coming in after the midterms, I think it really the kind of pro Bitcoin, pro crypto momentum will stall.
And there's likely to be. I don't know who or what will be leading the charge, but I suspect, you know, some kind of backlash, probably from the consumer protection angle, which seems to be the the flag that some of the Democrats that are a little more opposed to the Clarity Act are carrying right now, which which would involve, you know, in trying to impose a lot more scrutiny on and obligations.
on people building self-custody stuff or like ATM providers,
that kind of stuff, where, you know,
there's existing consumer protections regulations
that impose a lot of costs on those kinds of businesses
that I think Bitcoin has rightly avoided
because of the non-custodial nature of a lot of those products.
I think there'll be a stronger push from the Democrats
that come in to try to impose some of those regulations
on that part of the industry.
That's exactly what I was going to say.
That was awesome, man.
Thanks for jumping in.
You've never done this before on the show,
so this was great.
All right.
Thanks, Vijay.
Yeah, of course.
Later.
That was a very successful phone-a-friend,
I've got to say.
Yeah, that worked.
Very impressed there.
Okay, well, okay, that covered that one super well.
And I want to be conscious of your time, too,
So we're going to go through some of the next ones a little bit quickly here.
But the next one, I think, is one that definitely bears jumping into, which is just the Samurai Wallet Tornado Cash founders is point number 13.
They will not be pardoned this year, but there will be likely be future criminal cases or appeals that vindicate them.
So you don't think there's much of a chance of the Trump admin actually stepping forward to give pardons?
Yeah, this is also Vijay's perspective.
But yeah, it's probably something that will take more critical mass around it is kind of the expectations and that over time, more things will happen that will ultimately lead to an outcome similar to that, whether it's not them and like the immediate term.
In the meantime, people should go to Bill and Keone dot org and and do sign that petition and continue making noise on social media because you never know what might move the needle.
And again, that is Bill and Keone dot org.
uh point number 14 bit chat goes mainstream for local p2p discovery driving over 200 known e-cash
mints you touched on this a bit earlier at the start and i think the e-cash proliferation is
such a key point to this is there anything else you wanted to add to that based yeah yeah it's
like right now there's around like 30 uh on the on cashew and then through fediment i think it's
i think it's like 16 or something because those are larger but like um the uh so like that's that's
the way it works and it could be a lot more you know i didn't really know how to put like a number
but i was like yeah like 200 that's that that's a lot of growth um but yeah to the point i was
making earlier about like the p2p discovery and all of that i think that i think it's a valuable
app you know i our office is at the space denver our bitcoin citadel out here and you know we'll
just be like chatting with each other on it a lot of times in the middle of the day and like i see a
lot more use cases like a concert so like anywhere you go publicly where it makes sense to like
figure out some information that can be crowdsourced within a group in your immediate region.
Like I see it being used a lot more for that once he gets more eyeballs on it.
100%.
The next one here, and I apologize for the speed fire, but again, I like to be conscious of the time.
Yeah, yeah, yeah.
At least 100, this is point number 15, at least 100 small businesses begin offering discounts
for payment in Bitcoin instead of dollars through Square.
I mean, we've got what, 4 million plus merchants that just got the ability to be turned online.
I mean, that was one of the, I think, the most bullish developments this year.
I don't know about you.
Yeah, I think that the Square announcement is arguably the best thing that's happened for medium exchange use of Bitcoin, like in its history, outside of it existing.
But like, I think that, yeah, it getting turned on within this is it's going to change one, just like even from a branding perspective, it's going to change people's perception of it significantly.
But like the biggest thing is one of the things that I always try to hit home is that when, you know, for Bitcoin being used as a medium exchange, people be like, well, nobody's ever going to want to spend their own Bitcoin.
It's just like, dude, I don't want to spend anything that's valuable to me.
If I could get something from you and give you my toilet paper, I would be happy to, you know, but nobody's going to want that.
It comes from people demanding it in a transaction.
People are going to say, no, no, I want you to pay me in Bitcoin.
And I think that that's where we're going to start seeing a lot of growth through this
vector within Square.
And the reason isn't as much because people are like, I own a scarce, durable, portable
store of value that I can be self-sovereign with.
It's going to be because, oh, these are better rails than the encroachment of the banking
industry, which makes it so expensive for anybody to operate within it.
So credit card companies have to create a layer over it and then they have to charge X amount
of fees because it's an oligopolistic network as well. And all the merchants are the ones paying
for that right now. We don't want to do that. We would like to settle over something cheaper.
Okay, so Square's designed a system where we don't get a 2.5% credit card fee.
All right, well, let's offer people a discount to pay in Bitcoin. That's 2.5% that goes to our
margin. Bottom line, every year, you make a million dollars through your business in profit
every year, tack another 2.5% on it.
Like that's a lot of money.
People are going to want that.
And I think stores are going to start incentivizing Bitcoin
so that they can keep some of that.
Yeah, I think especially in lower margin businesses
where those fees really hit them like right in the gut,
we're absolutely going to see that.
And I think, again, just super bullish announcement.
I would agree.
It's just like it was massive news this year that, again,
just like didn't apparently move the needle price-wise,
but like very much moved the needle, I think, overall MOE adoption wise, which was great.
The next point, 16, no top 10 public Bitcoin mining company achieves more than 30% of revenue from AI compute for 2026 fiscal year driven by significant development delays.
So this is an interesting one given a lot of the pivots toward AI compute in a lot of these mining companies.
You're saying that I'm not sure what kind of some of the numbers are right now in terms of percentage of revenue,
But you're saying basically it's not going to – it won't go above 30% for any of these.
Yeah, that was –
It's still predominantly miners.
That was the biggest surprise to me when I looked into this question because I was writing this section in our business models.
And I was like, okay.
I was like, huh, I wonder how big these mining pivots have been so far.
And I started to look at the publicly available numbers that we could see, and I assumed they would be much larger.
Why?
All these guys want to have that premium in their stock price because of how much it's being valued right now.
So the narratives say we're an AI compute company.
The reality is, is that I think the largest in terms of like operating AI compute revenue generation, that's core scientific.
And they're at like 18% right now.
And most of the other ones, I'm pretty sure all like sub 10%.
There's a table in our report that covers all of that.
But I bet in 20, like, I think the problem is, is there's just, there's a lot of assets that exist out there to build more AI compute and repurpose some of these operations for it.
But there is a lot of development delays that are starting to occur within this side of the industry and actually being able to build out, get these sites developed or get them repurposed and operating and generating revenue.
I don't think that anybody is going to get higher than 30% of their total annualized revenue for 2026.
That's a bit of a cocky estimate, I'd say, but probably somewhere around that range.
I would be surprised if they get much higher than that.
I mean, it's interesting.
I assumed that some of them were already higher than that, so that's quite interesting given the amount of hype around it.
Yeah. So next piece, number 17, a federally chartered bank begins offering Bitcoin collateralized loans. Do you think that this ends up being a bank that kind of like acquires one of the existing companies that it's doing this in the space or building out their own products around this?
That's a great question.
for, you know, managing our ledger internally within the bank.
And that's kind of being outsourced to this like tech company that does that for a lot
of different banks.
And, you know, we have like a payments hub and it's a very similar story to how they're
using their core ledger system.
Any sort of functionality that they're doing, they either have like a third party service
provider or they're acquiring into it from some like separate division.
So it might be like owned by them, but it's really like a very separate thing from like
the overarching bank.
And yeah, so I think the history of banking is if banks want to do something, they acquire
into it, broadly speaking.
They don't have the expertise to build a lot of this stuff out.
Now, I think that we will have banks that, which are kind of starting off as like, we
have this new, like the term we use for it internally at Epoch is neo-neobanks.
The term neobank kind of came around when fintech was like, okay, banks suck.
Let's put a layer of lipstick over it so people have a better UX for everything and integrate into some more things.
And then now we have this world of like, okay, fintechs kind of suck.
Let's give them stable coins and Bitcoin and hook them into prediction markets and do all this other shit that the Neo Neo version wants to do.
So that's kind of what we call it.
There's going to be these very new financial institutions that are going to be purpose built for Bitcoin banking.
And those will probably be more organic in building things in-house.
And then maybe they're actually selling some of what they built to the other banks.
But yeah, I think that if it's like a larger bank in this prediction, adopting something
like that, it's hard to do everything because there's a lot of software that needs to get
built to make it easy for them.
And the reason is, to my point earlier, banks offer it on like this old legacy technology
with like an old core ledger system and an old payments hub.
And like, yeah, the CTO is just like, well, I don't really care how cool the new thing
is that you have, I'm not going to convert our entire bank over a new set of software.
Like you need to have something that plugs into this shitty old software.
And that's kind of what they need right now are businesses that are building the right
middleware that speaks the same language of what they work on, what they use internally.
And there's a pretty big void in that market right now.
So we kind of wrote our banking report around that thesis with like the Silvergate, former
Silvergate banking team.
And yeah, I think that those things are going to get built.
And then it comes down to a regulatory question as to how big that can get within a bank's total revenue, et cetera.
It's going to be interesting to see.
18, and I'm going to speed run here again.
But quantum preparedness continues to happen around tradeoffs among various key and signature schemes.
Code is written for BIP 360, but no concrete soft fork is in the works by the end of 2026.
do you think a lot of the quantum stuff is being uh uh how much of an immediate concern do you think
this is i see a lot of stuff around it but then it's also like a lot of the conversation around
that's fighting the quantum stuff a lot seems to ignore all the conversations that are happening
already and kind of being like hey we need to do this right now also i've got a quantum resistant
you know shit coin on solana or ethereum you know what i mean like is that your vibe on this too
yeah there was just like a weird i i like what what i'll say is i like what nick carter did
um i think he drew attention to things that educated me educated other people in the industry
um and and i you know i i don't know if he responded to everything in the perfect way on
twitter um and you know a few people always do but um i i do think his paper was a good paper
and it added value.
I, I, yeah, I'm, I'm in the camp of just like,
well, one I'll start with saying,
I wrote this quantum section in the report
and that's probably been like the most like clear
and shared thing from it so far.
That's not my intelligence.
That's the intelligence of me
interpreting other people's interpretations of quantum.
I think Reardon Code is probably the best podcast
I've heard on the quantum summary.
Hunter Beast is, who's writing BIP360
and started all that.
He's a member at the space.
I talk to him a lot.
I think that like the quantum is something
where I'm at is like,
it's a legitimate conversation to be having
and to your point exactly people have been having this conversation if you don't read it
bitcoin optech which very few people do particularly the types of people that are
commenting on quantum and the type of investors i talk to but um like bitcoin optech gave a great
summary of a lot of the progress in there and your report a few months ago on what's been happening
within quantum there's a good amount of research i'm not hurt i'm not trying to put people down for
wanting to have a discussion and try to, you know, put focus on something that's valuable.
But what we wrote about in our media section of the report is that like when you look at how
certain narratives spread for FUD, usually it's like they start within mainstream media and then
they like trickle down into our circles and then we have to like go combat them. And like one thing
that section is where like we officially have destroyed environmental FUD And that took like three years of data intensive systematic cooperative Bitcoiners like coming together and shitting on that FUD And it dead now and we won
And it ended up being one of the best narratives
for Bitcoin too that came out of it.
So that's cool.
But with like the quantum stuff,
we kind of FUD ourselves
and then it gets in because of us.
So we're kind of shooting ourselves in the foot a bit.
And it's like, maybe let the nerds talk about it
for a little bit longer.
and until it really becomes something to get worried about,
like just let them handle it in their forums
that other people aren't ever reading.
Fair enough on that one.
19, Bitcoin perception gap closes 50%.
What does that mean?
Yeah, so read the Bitcoin media section.
The perception metrics are like,
they're really cool.
Fernando of perception.to is his website,
but he um he's come up with just like a methodology of like putting a point system
and quantification around narratives from different media channels and the perception
gap is something that um is that gap i was initially talking about between how bitcoiners
perceive bitcoin and how like mainstream perceives bitcoin and he quantifies that as like a 125 point
gap which is like very large when you start to get baselined and see how that compared across sell new things But I think that over this year we going to start to see a lot more alignment across both
I feel like I've kind of witnessed that over the past year and I'm excited to
see how he measures it going into next year and what,
what the numbers come out to.
But I think that we're going to start to see cross pollination across media
channels.
Bitcoin's moving into like more of the foray and the,
the,
the big boy world.
And I think that that gap is not going to exist to the same extremes that it has.
Bitcoin podcasts go absolutely parabolic as we completely subsume the TradFi market.
So, yeah, people should check out the media section for that on the report.
Number 20, Bitcoin Core maintains dominance over alternative implementations.
Is there anything you'd like to say on that one?
No, I think that says it all.
And just like that, we're out of time.
Last one, I want to give you a chance to talk about this too,
and then I'll get you out of here.
But Epoch Ventures begins raising its fund too.
So you guys are raising, yeah?
Yeah, not yet, but we're predicting that we might be by the end of the year.
Ah, okay.
It's like an announcement of an announcement, but it's a prediction.
It's a prediction of an announcement.
Well dude I getting you out of here a little bit late Where do you again maybe just remind people where they can go to get this report anywhere else you want to send them Appreciate you running through this whole thing We got this was an awesome session here
Yeah, this was great, man.
Yeah, if you want to check out the report,
it's epoch, E-P-O-C-H-D-C.io.
That's our website.
Go to the writing section.
It's in there as a PDF to download.
We don't do like an email or anything, ask on it,
because that should always annoy me,
and I don't ever want to do that to people.
So just download the PDF and do something nice for me one day,
but,
or people on my team,
they're all tagged in it.
And yeah,
check us out on Twitter.
You'll see all of our handles in the report and my,
my handle on X is just my name.
Awesome,
dude.
Well,
this was a,
a blast doing this.
We made it through all 21 predictions.
Can't imagine why you chose the number 21 seems super random,
but this,
this was great.
Want people to check this report out.
Cause it's,
it is,
it is dense,
but it's a,
it's dense in a good way.
she's a beast yeah yeah no doubt well dude eric great catching up with you man we'll have to do
this again next time i won't nail you with 21 questions right off the bat i will keep it you
know we'll have we'll do a question having or something like that yeah yeah we'll do more of
like a vibes episode at some point yeah this there was just if i didn't go through this with you i
would have i would have uh i would have felt like i was missing out you know we had to give the people
give the people these 21 right right right well thanks man i appreciate it was a blast
likewise man