1
00:00:00,000 --> 00:00:06,220
I think the amount that you need to retire depends obviously on a few factors. This year,

2
00:00:06,340 --> 00:00:11,740
it would need to be something like what are some of the unique factors that you took into account

3
00:00:11,740 --> 00:00:16,680
into this calculation? What my guide attempts to do is to break those down into some simple

4
00:00:16,680 --> 00:00:22,320
assumptions. And I see us possibly breaking 200k. I think it's still realistic. The nice thing about

5
00:00:22,320 --> 00:00:26,160
it is it's still being adopted. So people can actually get some alpha on this and still take

6
00:00:26,160 --> 00:00:31,600
advantage of some pretty extreme gains. A lot of people compare it to the adoption of the internet.

7
00:00:32,040 --> 00:00:36,900
Bitcoin is being adopted much faster than the internet was. The health of the dollar is probably

8
00:00:36,900 --> 00:00:46,020
in worse shape than most people are really realizing. What's up guys? 70,000 of you guys

9
00:00:46,020 --> 00:00:50,680
keep coming back every single month, but 71% are not subscribed. So you're going to miss out on

10
00:00:50,680 --> 00:00:55,120
some of the great green candle content. So make sure that you're hitting that subscribe button

11
00:00:55,120 --> 00:00:59,120
with the bell notification so you get notified every time I drop a video.

12
00:00:59,560 --> 00:01:02,060
All right, now let's get back into this great interview.

13
00:01:02,980 --> 00:01:08,720
Bing bong, I am back with another edition of the State of Bitcoin podcast where I've got the man,

14
00:01:08,800 --> 00:01:14,440
the myth, the legend, Smitty in the house. He's the legend behind one of the coolest

15
00:01:14,440 --> 00:01:20,320
retire on Bitcoin calculators that I've seen. And so I had to bring him on. As you guys know,

16
00:01:20,320 --> 00:01:24,940
I love this topic and I want to dive in. So Smitty, I'll start it off the jump, man.

17
00:01:25,120 --> 00:01:27,100
How much Bitcoin do you need to retire?

18
00:01:27,380 --> 00:01:34,840
And what are some of the unique factors that you took into account into this calculation that you think a lot of these are not taking in?

19
00:01:36,040 --> 00:01:36,480
Oh, man.

20
00:01:36,840 --> 00:01:39,440
Well, yeah, great to have a conversation with you, Brandon.

21
00:01:39,680 --> 00:01:40,480
Thanks for having me.

22
00:01:41,580 --> 00:01:46,320
I think the amount that you need to retire depends, obviously, on a few factors.

23
00:01:46,320 --> 00:01:52,020
and a lot of people are, you know, different stages of life, different places on the globe,

24
00:01:52,780 --> 00:02:00,500
have different situations in terms of income and savings. But what my guide attempts to do is to

25
00:02:00,500 --> 00:02:06,340
break those down into some simple assumptions and uses the power law math to project out,

26
00:02:06,340 --> 00:02:11,020
you know, what that amount would need to be in a given year in the future

27
00:02:11,020 --> 00:02:17,020
that you want to retire in based on your age and based on your annual expenses in the future.

28
00:02:17,880 --> 00:02:22,620
So roughly speaking, and I just, you know, I say roughly speaking,

29
00:02:23,480 --> 00:02:28,440
starting this year, it would need to be something like around 10 Bitcoin.

30
00:02:30,440 --> 00:02:34,200
You know, and that varies a little bit depending on some other factors. But that's,

31
00:02:34,200 --> 00:02:37,100
I think that's a good starting point for people this year.

32
00:02:37,100 --> 00:02:44,560
so 10 bitcoin to retire this year but say five to 10 years um from now uh i'd like to dive in and

33
00:02:44,560 --> 00:02:49,100
just see like you know how dramatically that changes because i think the power law is pretty

34
00:02:49,100 --> 00:02:55,880
unique in the way that it is broken down and you know kind of calculating the overall bitcoin price

35
00:02:55,880 --> 00:03:01,920
obviously it projects out the bitcoin price with all of this but you know i think uh you know i i

36
00:03:01,920 --> 00:03:03,620
One, I have some qualms with it.

37
00:03:04,020 --> 00:03:11,420
I don't think it's necessarily a bad tool, but I do think that over time, all models will be broken.

38
00:03:11,420 --> 00:03:18,280
I think that the way that you look at Bitcoin right now, there really hasn't been an asset like that.

39
00:03:18,800 --> 00:03:25,340
So one, I think power law is probably a little conservative, which would be better for the model here.

40
00:03:25,340 --> 00:03:29,620
but why did you choose the power law to use

41
00:03:29,620 --> 00:03:32,640
and break it all down for us,

42
00:03:32,680 --> 00:03:34,060
for the kids at home here?

43
00:03:34,960 --> 00:03:36,520
Yeah, that's great.

44
00:03:36,860 --> 00:03:37,840
So yeah, I agree.

45
00:03:37,960 --> 00:03:41,620
I think the power law is gonna be on the conservative side.

46
00:03:42,760 --> 00:03:45,360
My philosophy, I don't know what everybody else's philosophy

47
00:03:45,360 --> 00:03:46,440
is with retirement plan,

48
00:03:46,520 --> 00:03:48,120
but I think it's probably a good thing

49
00:03:48,120 --> 00:03:49,980
to be somewhat conservative when you're doing,

50
00:03:50,260 --> 00:03:51,780
it's a pretty important thing to plan for.

51
00:03:51,780 --> 00:04:01,900
So I think to plan for more conservative cases is just generally a responsible approach to doing one's own retirement planning.

52
00:04:02,780 --> 00:04:09,820
There are a number of reasons why I think my approach is conservative in addition to the power law approach.

53
00:04:10,060 --> 00:04:13,820
One is that it's not the average price of the power law going forward.

54
00:04:13,820 --> 00:04:17,000
It's actually the latest version is the fifth percentile.

55
00:04:17,180 --> 00:04:23,540
It's called the fifth percentile, meaning that you're taking the upside volatility sort of out of the equation.

56
00:04:23,820 --> 00:04:28,740
Everybody's very concerned in the future about these 80 percent crashes and things like that.

57
00:04:28,960 --> 00:04:30,580
But what this does is it tracks.

58
00:04:30,760 --> 00:04:40,900
If you've seen that plot of the power law line that you can't unsee, there's a support line that basically tracks with all the accumulation phases or call them bear markets.

59
00:04:41,120 --> 00:04:42,220
But it's a straight line.

60
00:04:42,220 --> 00:04:50,480
So the fifth percentile essentially traces that support line, and it's not going through these bubbles that you see every year.

61
00:04:51,080 --> 00:04:58,640
So in that sense, it's allowing you to plan around that support line and takes that volatility out of the equation.

62
00:04:58,640 --> 00:05:11,400
The other reason is that this assumes, Brandon, a 7% average exponential growth of the money supply, a.k.a. monetary inflation.

63
00:05:12,220 --> 00:05:15,360
And so that never goes away in this model, in this planner at all.

64
00:05:15,460 --> 00:05:17,100
It starts from today.

65
00:05:17,460 --> 00:05:24,200
It goes through to the year that you're planning to retire in, and it goes all the way to the end of your retirement.

66
00:05:24,980 --> 00:05:33,040
And the reason that's useful is that mostly people don't experience a 7% inflation in their life.

67
00:05:34,520 --> 00:05:38,500
Usually what they actually experience on the ground is something a little bit less than that.

68
00:05:38,640 --> 00:05:40,680
So it's a 7% average.

69
00:05:40,680 --> 00:05:48,940
And, you know, this has been pretty accurate. It's like 96, 97% are squared for the last 100 years, basically monetary inflation.

70
00:05:50,080 --> 00:05:53,380
That's going to continue forward. And so this accounts for that, right?

71
00:05:53,380 --> 00:06:06,980
So if you're going to retire in 2035 and you're expecting to spend down $100,000 a year for life expenses, that's $100,000 equivalent in 2035, not today's, not, yeah.

72
00:06:06,980 --> 00:06:12,500
So today, so twenty twenty five hundred thousand dollars, not twenty thirty, not twenty thirty five hundred thousand dollars.

73
00:06:12,620 --> 00:06:19,700
So there's a number of factors in here. I think it's a it's a it's a frugal and conservative planner.

74
00:06:20,440 --> 00:06:24,060
But yeah, of course, you could always go down the weeds and tune a bunch of other knobs.

75
00:06:24,200 --> 00:06:27,080
You know, there's tax considerations. There's can you leverage your Bitcoin?

76
00:06:27,340 --> 00:06:32,720
Can you, you know, can you take out Bitcoin backed loans and can you kind of do that approach?

77
00:06:32,720 --> 00:06:40,080
but this is meant to be an approachable guide that can be used by people of all ages you can

78
00:06:40,080 --> 00:06:48,040
have everything captured kind of on a single page and and give you a nice target now with this i

79
00:06:48,040 --> 00:06:53,000
think it's interesting too you broke it down by different countries which i think is really cool

80
00:06:53,000 --> 00:06:59,360
so obviously there's a bunch of different uh i guess aspects obviously living conditions all of

81
00:06:59,360 --> 00:07:04,700
these things, but Bitcoin is global money at the end of the day. So you could essentially,

82
00:07:05,060 --> 00:07:10,420
you know, theoretically take it anywhere. But, you know, when you were coming across some of these,

83
00:07:10,420 --> 00:07:18,560
you know, I know you assumed 7% annual M2 money supply growth. Was there anything else that you,

84
00:07:18,820 --> 00:07:24,420
I guess, took into account for maybe some of these different jurisdictions when you're looking at,

85
00:07:24,420 --> 00:07:31,360
retirement as of location and other aspects of it that might change that? Or is there anything

86
00:07:31,360 --> 00:07:37,620
that you would think that could potentially be outside maybe this model that could cause it to

87
00:07:37,620 --> 00:07:43,120
break? Yeah, across the different countries, kind of an interesting thing. There's going to be a lot

88
00:07:43,120 --> 00:07:48,100
of exceptions depending. So if you live in like Bolivia, right? This is not to say that because

89
00:07:48,100 --> 00:07:54,260
you live in Bolivia, you are going to be able to retire in 10 years on 0.1 BTC.

90
00:07:54,980 --> 00:07:58,100
You know, your lifestyle could be very different and you might need one BTC

91
00:07:59,060 --> 00:08:02,260
or you could live in a specific jurisdiction where you need less.

92
00:08:02,740 --> 00:08:09,140
So what this is actually showing is averages. This is all averages. And particularly it's based on

93
00:08:10,580 --> 00:08:17,140
the average income for these different countries. And so again, it's sort of a simplified starting

94
00:08:17,140 --> 00:08:23,700
point. And it's meant to really compare between different countries. So it's going to require a

95
00:08:23,700 --> 00:08:29,640
lot more Bitcoin to retire in France than it's going to require to retire in Bolivia, for example.

96
00:08:30,380 --> 00:08:33,920
And so it's supposed to give you a cent. But the encouraging thing about it is that

97
00:08:33,920 --> 00:08:40,140
if you find yourself in sort of the average case and you live and you're age between 5 and 75,

98
00:08:40,140 --> 00:08:47,640
you know you this might actually encourage you to look uh you know your target stack is 0.1 btc

99
00:08:47,640 --> 00:08:55,080
okay well on average where's this kind of you know uh maybe change some of your future retirement

100
00:08:55,080 --> 00:09:01,700
goals in terms of uh where you want to retire you know so um that's sort of what it's really

101
00:09:01,700 --> 00:09:05,800
meant to do and it's the same sort of assumptions it's the seven percent inflation adjusted

102
00:09:05,800 --> 00:09:13,720
that could change because some of these are not actually USD based, although a lot of these operate using USD.

103
00:09:14,560 --> 00:09:18,100
But it's the same fifth percentile power regression model as well.

104
00:09:19,400 --> 00:09:26,400
Now, it is interesting that we are kind of doing this at the eve of a big sell off here this past weekend.

105
00:09:26,540 --> 00:09:28,300
We're recording this on October 14th.

106
00:09:28,360 --> 00:09:35,120
Obviously, historically, we've got the Bitcoin meme uptober with the last quarter of the year here really being solid.

107
00:09:35,120 --> 00:09:40,360
but you've printed out some good research about October and the price action.

108
00:09:41,160 --> 00:09:44,800
Now, with this, I already told you a little bit.

109
00:09:44,920 --> 00:09:49,140
I gave you a little bit of my thoughts on maybe I'm considered a moon boy,

110
00:09:49,240 --> 00:09:54,740
but I do definitely think that the price action here is,

111
00:09:55,380 --> 00:09:58,700
although the power law says it's slowing down, I see governments adopting,

112
00:09:58,840 --> 00:10:01,780
I see institutional adoption rapidly increasing.

113
00:10:01,780 --> 00:10:12,820
And I think that there's obviously a bunch of Bitcoin being taken off exchanges, OTC desks, you name it, the buying pressure is there from the big players and big money.

114
00:10:13,380 --> 00:10:23,540
But on the flip side of things, traditional finance looks at Bitcoin as just kind of similar to any other type of asset, especially with this power law.

115
00:10:24,220 --> 00:10:26,420
As it gets bigger, the volatility goes down.

116
00:10:26,420 --> 00:10:35,460
In my opinion, I think that we still have a lot of the upside potential, but we're going to build a stronger floor base from where we are right now.

117
00:10:36,200 --> 00:10:41,680
And I think that this could be kind of something that we see with the potential of a supply shock.

118
00:10:42,260 --> 00:10:44,020
Now, I'll put you on the spot here.

119
00:10:44,020 --> 00:10:57,520
Do you see that as a possibility here in the future where, you know, the power law, it has these bands, but we do have the potential to really break out of it here in the near term just with all this buying pressure we have?

120
00:10:59,380 --> 00:11:00,760
Well, okay, there's a lot there.

121
00:11:01,960 --> 00:11:04,020
So I'll kind of separate a couple things out.

122
00:11:04,100 --> 00:11:08,540
One is I've been tracking this October and historical October trends lately.

123
00:11:08,540 --> 00:11:15,900
this is not really related to the power law analysis that I do, which is more of a long-term

124
00:11:15,900 --> 00:11:22,740
trend analysis. And we can talk about that in a sec. The October thing, you never know exactly

125
00:11:22,740 --> 00:11:26,920
what Bitcoin is going to do. It's never exactly the same from year to year. But if you look at

126
00:11:26,920 --> 00:11:31,520
the historical trends, October has been a very bullish year. And so it's been either the first

127
00:11:31,520 --> 00:11:38,120
or second highest return month historically. But some years there's exceptions, but it does

128
00:11:38,120 --> 00:11:43,600
particularly well when you start getting around the years that are supposed to be, you know, up years.

129
00:11:43,720 --> 00:11:49,580
And so the median return by the end of the month in October is supposed to be 15.6, and the average

130
00:11:49,580 --> 00:11:55,840
is about 27.7. And so you can take, you can look at it through different lenses, but in both of

131
00:11:55,840 --> 00:12:00,940
those cases, you're talking about the top one or two months in terms of, and the other thing is that,

132
00:12:01,160 --> 00:12:05,720
and I think a couple other analysts have pointed this out, is that most of those, most of the upside

133
00:12:05,720 --> 00:12:11,440
in October and happens in the latter half. And so really we're crossing the Rubicon right now to see

134
00:12:11,440 --> 00:12:17,200
what the latter half of October is really going to look like. And so I think people are quick to

135
00:12:17,200 --> 00:12:24,620
assume that October is going to be a dud this year. But I just, if you look at the time series

136
00:12:24,620 --> 00:12:29,400
plots that I put together, you really don't know until you start to get past the 15th

137
00:12:29,400 --> 00:12:34,220
into the first few days. And then really you might not see a heck of a lot of upside action

138
00:12:34,220 --> 00:12:40,240
until after the 22nd. So I'm still bullish on this month. My target this month, and again,

139
00:12:40,280 --> 00:12:45,700
this is not power law analysis. It's more of like kind of data-driven estimates, right?

140
00:12:46,100 --> 00:12:51,320
I think it's going to be, will be between somewhere between 130 and 150 by the end of the month,

141
00:12:51,320 --> 00:12:55,420
but I could be wrong. This is probabilities, right? It's not, there's nothing certain about

142
00:12:55,420 --> 00:13:00,800
this. This is a matter of probabilities, but that would be very, that'd be very bullish in my

143
00:13:00,800 --> 00:13:06,420
opinion to get into that price range but and i think it's very realistic still uh and then to

144
00:13:06,420 --> 00:13:11,180
the power law thing um you can actually tie this in with the power law because we've seen this

145
00:13:11,180 --> 00:13:16,060
correction the last few days which is really uh especially for some of the newbies has given them

146
00:13:16,060 --> 00:13:22,740
a heart attack uh but we've had a few since we started this accumulation market in 2022

147
00:13:22,740 --> 00:13:28,840
uh this uptrend this very steady kind of stair uh stair stepping action that we've happened for the

148
00:13:28,840 --> 00:13:36,100
us we've happened to have have had for the last couple years we tend to see um kind of two steps

149
00:13:36,100 --> 00:13:41,920
up and then one step down two steps up one step down and what this ends up doing is we're now

150
00:13:41,920 --> 00:13:48,400
right at the power law median meaning that we're at roughly the 50th percentile I don't think it's

151
00:13:48,400 --> 00:13:54,580
exactly 50th percentile but it's just right about what the power law model would predict we would be

152
00:13:54,580 --> 00:13:59,060
right now in terms of the median, which is pretty interesting, you know, as a power law analyst.

153
00:14:00,220 --> 00:14:04,420
And then if you want to go even further, I haven't shared a chart on this in a while,

154
00:14:05,040 --> 00:14:08,960
but you will find that over time, the strength of the power law correlation

155
00:14:08,960 --> 00:14:16,460
has been increasing over time for like the last like eight years or more. And so meaning the R

156
00:14:16,460 --> 00:14:24,200
squared in that regression fit is going from like 96 to 97%. And so, yeah, you know, so for the

157
00:14:24,200 --> 00:14:30,720
skeptics out there, power law, just keep that in mind. I think that that's just adding a little

158
00:14:30,720 --> 00:14:36,260
bit more credibility to the model all the time, in my opinion. All right. Yeah, that's interesting.

159
00:14:36,820 --> 00:14:44,760
So, all right. Well, I mean, we're recording here at 112, just under 113. So if we get to 130 to

160
00:14:44,760 --> 00:14:49,880
150, I definitely think that'll be super bullish here going forward. So, hey, man, I hope so.

161
00:14:49,880 --> 00:14:55,160
And by the time we get to this podcast out here, it'll be like in a week or so.

162
00:14:55,320 --> 00:14:56,360
So who knows?

163
00:14:56,460 --> 00:15:02,100
Maybe we'll be there by the time this thing comes out and you look like a genius or, you know, as a giant sell off.

164
00:15:02,240 --> 00:15:04,060
Or everybody unfollows me at the end of the month.

165
00:15:04,100 --> 00:15:04,440
That's fine.

166
00:15:04,480 --> 00:15:05,440
Yeah, exactly.

167
00:15:05,860 --> 00:15:08,360
What if I told you you never had to sell your Bitcoin?

168
00:15:08,660 --> 00:15:11,680
Instead, you can borrow against it with salt lending.

169
00:15:12,260 --> 00:15:16,600
Why give up your hard earned Bitcoin when you can unlock its value without letting it go?

170
00:15:16,600 --> 00:15:23,600
With Salt, you get secure Bitcoin collateralized loans with no credit checks, no prepayment

171
00:15:23,600 --> 00:15:27,600
fees and best of all, no rehypopulation.

172
00:15:27,600 --> 00:15:32,040
Salt has had zero customer collateral losses since it launched.

173
00:15:32,040 --> 00:15:38,140
Salt was the first platform to offer Bitcoin collateralized loans starting way back in 2016.

174
00:15:38,140 --> 00:15:42,700
Today they offer tailored options for both individuals and businesses.

175
00:15:42,700 --> 00:15:47,440
And now introducing Salt Shield, the no liquidation solution.

176
00:15:47,440 --> 00:15:51,440
No forced liquidations during the lifetime of your loan when you're enrolled with Salt

177
00:15:51,440 --> 00:15:52,500
Shield.

178
00:15:52,500 --> 00:15:58,380
This just launched at the Bitcoin conference in Las Vegas and it is next level peace of

179
00:15:58,380 --> 00:15:59,420
mind.

180
00:15:59,420 --> 00:16:06,600
For green candle listeners only, head to saltlending.com slash green dash candle for this exclusive

181
00:16:06,600 --> 00:16:22,191
offer for your Bitcoin collateralized loan can get cash for your Bitcoin today Salt Lending secure trusted proven It always is tough with these price predictions and everything like that but I do think it

182
00:16:22,191 --> 00:16:29,111
very interesting the way that Bitcoin acts. Now, you described two different analyses

183
00:16:29,111 --> 00:16:35,271
with the short-term and your long-term view. I want you to dive into that a little bit more.

184
00:16:35,271 --> 00:16:40,211
How do you view it in the short term and then the long term correlation with the power law?

185
00:16:41,111 --> 00:16:43,191
Why do you kind of view those two?

186
00:16:43,351 --> 00:16:47,911
And do you see some maybe volatility here still in the short term to stick around?

187
00:16:48,111 --> 00:16:54,471
Or are you almost of the believer that maybe the four year cycles are kind of gone here?

188
00:16:56,171 --> 00:16:57,451
Oh, boy, that's a good question.

189
00:16:57,871 --> 00:17:00,111
I'm not totally sold that the cycles are gone.

190
00:17:00,111 --> 00:17:14,491
I am very open to the idea that we are going through what I call a phase change, which is within the power law, within the framework of the power law, we might be seeing a change in frequency.

191
00:17:14,951 --> 00:17:24,291
Because I think a lot of people have been married to this exact precise four-year cyclical timeline to hitting the price peaks for each cycle.

192
00:17:24,291 --> 00:17:28,291
And yeah, that has been pretty interesting.

193
00:17:28,931 --> 00:17:37,291
And it's certainly caught my eye how it's been exactly 1,000, whatever, 64 days from peak to peak, whatever.

194
00:17:38,031 --> 00:17:44,791
But the other fact of the matter is that we have three data points on that, really kind of two data points if you take the two cycles together.

195
00:17:45,251 --> 00:17:46,531
And it's like peak to peak to peak.

196
00:17:47,991 --> 00:17:48,871
That's interesting.

197
00:17:48,871 --> 00:17:58,451
But I can't think of anything as an analyst that fundamentally puts Bitcoin in a clock in the way that people are describing.

198
00:17:58,651 --> 00:18:00,171
Sometimes you see these Bitcoin clocks.

199
00:18:01,091 --> 00:18:02,991
If that keeps going, I'll be very interested.

200
00:18:04,551 --> 00:18:12,871
I have a variant model of the power law where I try to capture what I project to be the tops, the price tops.

201
00:18:13,091 --> 00:18:14,611
But I don't put dates on it.

202
00:18:14,611 --> 00:18:22,511
So I, the way I do it is it's called the decay channel model and people can check that out on my page, but I, I, I put a top model, right?

203
00:18:22,611 --> 00:18:24,531
So there's a lower bound and then there's an upper bound.

204
00:18:24,591 --> 00:18:25,751
The upper bound is the top model.

205
00:18:26,271 --> 00:18:35,831
And what that says is that if, if we reach a cycle top in on X date, we expect to be in the ballpark of say 200 K.

206
00:18:35,831 --> 00:18:43,331
and so for my model for example that that would say so if we actually hit the price peak for this

207
00:18:43,331 --> 00:18:48,531
cycle at the end of this year like December you know later half of December for example

208
00:18:48,531 --> 00:18:55,671
should be peaking just over 200k if that's indeed the top of the cycle and that's been amazingly

209
00:18:55,671 --> 00:19:00,811
consistent over every single cycle since the beginning of Bitcoin which is pretty compelling

210
00:19:00,811 --> 00:19:06,111
to me. But I'm not even totally married to that, to be honest, because I think there's, like you

211
00:19:06,111 --> 00:19:13,451
said, there's so much changing with the institutions. I think that the business cycle, you know,

212
00:19:13,511 --> 00:19:19,491
it is cyclical, but I mean, we're kind of going through a change in the monetary order right now,

213
00:19:19,491 --> 00:19:27,891
it seems like. So kind of if I boil everything down, my long-term analysis is that I think the

214
00:19:27,891 --> 00:19:32,551
the power lot is going to hold in fiat terms,

215
00:19:32,631 --> 00:19:35,131
like in US dollars terms until it's, until it doesn't.

216
00:19:35,471 --> 00:19:38,231
And I think we're going to start seeing signals that it's falling apart.

217
00:19:38,591 --> 00:19:42,651
And that R squared that I'm talking about, the correlation coefficient,

218
00:19:43,031 --> 00:19:44,731
that's going to start to drop.

219
00:19:44,811 --> 00:19:49,211
And likely what will happen in my opinion is the dollar amount will start to

220
00:19:49,211 --> 00:19:50,991
get closer and closer to the tops.

221
00:19:51,591 --> 00:19:54,431
And it'll start to sort of break to the upside, as they say.

222
00:19:54,931 --> 00:19:57,311
I think this will take years, years and years to do.

223
00:19:57,891 --> 00:20:02,931
uh if not a decade or so so i think it'll be somewhat gradual process but i'm totally open

224
00:20:02,931 --> 00:20:06,851
to that happening i think we'll start to notice it happening and i think you know i mean look at

225
00:20:06,851 --> 00:20:12,611
weimar germany uh there were you know billionaires and trillionaires and and marks but it didn't mean

226
00:20:12,611 --> 00:20:19,651
that they were you know uh the ultra wealthy in terms of purchasing power um there's also a power

227
00:20:19,651 --> 00:20:24,451
law in gold there's actually a power law in a lot of different assets but the second hardest asset

228
00:20:24,451 --> 00:20:31,091
out there arguably is gold right so there's also a power law of bitcoin in gold and so sort of this

229
00:20:31,091 --> 00:20:35,891
concept that i'm playing around with and i plan to put more analysis out on is i i almost anticipate

230
00:20:35,891 --> 00:20:43,251
a long-term power law trend in like gold something that would actually be a good anchor point to what

231
00:20:43,251 --> 00:20:49,171
your purchasing power is for any individual and then you might see us dollars fall off a cliff or

232
00:20:49,171 --> 00:20:55,631
you know or fall up fall up to the moon in terms of dollars uh which would be kind of like a

233
00:20:55,631 --> 00:21:02,271
hyperinflation scenario so but that's sort of my but this is all long-term speculation but

234
00:21:02,271 --> 00:21:07,031
this is what i could see playing out yeah for now the power law the power law is pretty solid

235
00:21:07,031 --> 00:21:13,031
yeah i mean that's interesting the power law of bitcoin in gold would be something that i would

236
00:21:13,031 --> 00:21:18,231
i would maybe attune to a little bit more just because of how much you know we're seeing bitcoin

237
00:21:18,231 --> 00:21:20,971
our dollars get inflated away.

238
00:21:21,631 --> 00:21:25,411
And I don't know how closely you're following the precious metals market,

239
00:21:25,571 --> 00:21:30,211
but we just had recent acceleration in silver and gold prices.

240
00:21:30,211 --> 00:21:31,791
Silver all-time high. Yeah, that's right.

241
00:21:32,291 --> 00:21:36,391
So we're kind of having this new, quote-unquote, debasement trade

242
00:21:36,391 --> 00:21:38,671
gain a ton of popularity right now.

243
00:21:39,611 --> 00:21:41,311
What do you take into account of that?

244
00:21:41,351 --> 00:21:46,391
And what's your opinion of kind of this new craze for not only just Bitcoin,

245
00:21:46,391 --> 00:21:48,931
but all the precious metals and hard assets in general?

246
00:21:51,191 --> 00:21:59,771
Yeah, I mean, look, I just think it means that I think that the health of the dollar is probably in worse shape than most people are really realizing.

247
00:22:00,031 --> 00:22:08,991
And I think that if there's one indicator that has told us that it's an unhealthy state, it's been the price of gold and the price of precious metals in general.

248
00:22:08,991 --> 00:22:13,871
and the fact that now we've been seeing all-time high after all-time high of gold

249
00:22:13,871 --> 00:22:18,591
and now we're seeing silver, I think it's, you know,

250
00:22:18,691 --> 00:22:25,391
to me it's the biggest alarm bell ever that people should be running into hard assets at this point in time.

251
00:22:27,811 --> 00:22:31,631
Yeah, so then do you take any close looks at like the bond market

252
00:22:31,631 --> 00:22:34,531
and how that is reacting comparatively as well?

253
00:22:35,931 --> 00:22:38,811
I don't spend too much time looking at the bond markets.

254
00:22:38,991 --> 00:22:42,831
To be honest, I probably should, but I only have so much time on my hands.

255
00:22:42,931 --> 00:22:46,531
I tend to spend a lot of my time looking at the price action of Bitcoin and things like that.

256
00:22:46,531 --> 00:22:47,991
Yeah, okay.

257
00:22:48,311 --> 00:22:53,631
So I just wanted to, yeah, because it seems like the bond market is kind of screaming for a collapse as well,

258
00:22:53,751 --> 00:22:56,471
similarly to the gold and silver markets.

259
00:22:56,651 --> 00:23:01,411
But I think it's interesting the way the overall Bitcoin market has been playing out.

260
00:23:02,091 --> 00:23:07,671
Now, like we said, we just saw that recent run-up in silver hitting that all-time high

261
00:23:07,671 --> 00:23:09,311
and gold continuing to run up.

262
00:23:09,431 --> 00:23:13,011
Gold actually, I think, has three to four times better return

263
00:23:13,011 --> 00:23:15,731
than the S&P 500 so far this year as well.

264
00:23:16,691 --> 00:23:24,091
But Bitcoin, we've been kind of floating around this 100 to 120 mark here

265
00:23:24,091 --> 00:23:25,391
for quite some time.

266
00:23:26,151 --> 00:23:28,851
So do you think that this is the quarter here,

267
00:23:28,971 --> 00:23:31,091
this last like three-ish months of the year,

268
00:23:31,511 --> 00:23:33,971
this is the time that we're going to really start to break out?

269
00:23:33,971 --> 00:23:38,311
And, you know, where do you think we're going as far as like the cycles go?

270
00:23:38,491 --> 00:23:43,511
Because, you know, you mentioned that the business cycle and I want to kind of ask you about the halving.

271
00:23:43,611 --> 00:23:50,531
Do you think that that kind of plays into the four year cycle or is it more just kind of based on the business cycles here?

272
00:23:51,891 --> 00:23:59,371
Yeah, I think I think the primary factor is the liquidity cycles, global liquidity, business cycle, whatever you want to call it.

273
00:23:59,371 --> 00:24:12,171
I think when money is cheaper, I think that people, the investment markets are, you know, more likely to get put into all kinds of different assets.

274
00:24:12,171 --> 00:24:23,051
Right. And I think that given, though, this awakening to the falling apart of the dollar of the time that people can see this trend, people are losing purchasing power.

275
00:24:23,151 --> 00:24:26,871
The average person, you know, the top 1 percent holds 50 percent of the wealth.

276
00:24:26,871 --> 00:24:34,791
And I think people are becoming more hip to the fact that, you know, you have to hold hard assets.

277
00:24:35,091 --> 00:24:45,111
And so, yeah, I think the liquidity cycle has a lot to do with the cycles of Bitcoin.

278
00:24:45,311 --> 00:24:45,971
I'll put it that way.

279
00:24:46,271 --> 00:24:48,031
That's sort of a primary factor.

280
00:24:49,171 --> 00:24:51,511
The halving, I mean, I've kind of looked at the halving.

281
00:24:51,611 --> 00:24:54,231
I've looked at the election cycle and things like this.

282
00:24:54,551 --> 00:24:55,811
There are these different correlates.

283
00:24:55,811 --> 00:25:01,711
the problem is it's really hard for me to find because it hasn't really been a demand driven

284
00:25:01,711 --> 00:25:08,331
thing with Bitcoin um actually some other great power analysts talk about this a lot which is that

285
00:25:08,331 --> 00:25:15,211
Bitcoin's growth behavior behaves way more like a growing organ is more network like a true network

286
00:25:15,211 --> 00:25:19,951
so it's more network and adoption driven than a demand driven thing which is you know sort of a

287
00:25:19,951 --> 00:25:26,671
Metcalfe's law principle. So for that reason, I don't see it having a whole lot to do with the

288
00:25:26,671 --> 00:25:32,711
having, although there may be some psychological factor, some Russian, some anticipation there.

289
00:25:33,211 --> 00:25:37,951
Although I'm skeptical, I just don't really see a real mechanism there. I think it's a lot more to

290
00:25:37,951 --> 00:25:43,951
do with the liquidity cycles. As far as do we, what are things going to look like? It's been a

291
00:25:43,951 --> 00:25:50,671
bit of a so so year for bitcoin especially compared to gold this is true but again if you look at the

292
00:25:51,551 --> 00:25:58,031
the nominal uh power law trend long term for bitcoin it does have these cycles that kind of

293
00:25:58,031 --> 00:26:03,551
overlay onto the power law right these bubbles the bubbles come and then they burst well the the kind

294
00:26:03,551 --> 00:26:08,831
of structure that they've had historically is that first of all they follow the support line

295
00:26:08,831 --> 00:26:12,831
on the bottom so they might be in the fifth to tenth percentile and then what they do is they

296
00:26:12,831 --> 00:26:22,091
They creep up into the sort of middle section and they spend a decent amount of time in sort of 30th to 50th, maybe 50th to 60th percentile.

297
00:26:22,191 --> 00:26:28,531
And they'll spend years kind of dancing around in that regime, even though the price is still growing.

298
00:26:28,651 --> 00:26:30,951
It's sort of trudging along or crab crawling, as I say.

299
00:26:31,871 --> 00:26:42,811
And then what happens with Bitcoin is you really kind of have like in the final hour, a big spike where you jump into the, you know, oh, now you're in the 80th, 90th, 99th.

300
00:26:42,831 --> 00:26:48,851
percentile price range. And it doesn't last there for a heck of a long time. And then the air is

301
00:26:48,851 --> 00:26:53,951
sort of let out of the balloon over the following year or two to get you back to the support line.

302
00:26:53,951 --> 00:27:01,551
So I don't think anything is too unusual in that regard this year. So I'm not like,

303
00:27:02,831 --> 00:27:07,511
I don't really see Bitcoin as having like a down year in that respect, because I just think that

304
00:27:07,511 --> 00:27:12,211
we're following the typical structure, somewhat typical structure. The unusual thing about the

305
00:27:12,211 --> 00:27:19,351
structure this year is actually that we're following an unusually steady and low volatility

306
00:27:19,351 --> 00:27:27,051
path that's actually following an exponential. So I don't really know how it's going to play.

307
00:27:27,131 --> 00:27:31,591
I don't know if we're going to keep, like in other words, we could either keep marching through

308
00:27:31,591 --> 00:27:36,871
the 60th percentile, 70th percentile, 80th percentile, and then boom, in a couple of years,

309
00:27:36,871 --> 00:27:42,811
we hit a million dollars, you know, or is it going to be more like the previous years where

310
00:27:42,811 --> 00:27:48,791
we trudge along and then next year, 2026, we kind of blow off, you know, early 2026, we blow off,

311
00:27:49,891 --> 00:27:55,771
scrape the 200 to 300 range and then come back down. I think both scenarios are plausible. But

312
00:27:55,771 --> 00:28:01,291
yeah, I mean, I have low time preference as a Bitcoiner, so it doesn't, either way, I'm bullish,

313
00:28:01,291 --> 00:28:07,791
you know but uh yeah yeah 100 i mean either way i think we all are bullish but i think it's it's

314
00:28:07,791 --> 00:28:13,151
kind of fun to play around and and scope everything out because there's so many just unknown factors

315
00:28:13,151 --> 00:28:18,811
with this right like i mean lawrence lapard has his book the big print uh where you know there

316
00:28:18,811 --> 00:28:23,991
could be excess liquidity just being dumped into the market and i mean it seems like that's i mean

317
00:28:23,991 --> 00:28:28,371
at least from the interest rate perspective where we are going to cut interest rates here in the

318
00:28:28,371 --> 00:28:35,351
next couple of weeks and then presumably cut in December. And then by the time May comes around,

319
00:28:35,351 --> 00:28:42,751
when Powell is getting the boot here, Trump wants extremely low interest rates. So with the amount

320
00:28:42,751 --> 00:28:48,331
of potential liquidity coming in, you know, obviously it's hard to kind of project that

321
00:28:48,331 --> 00:28:55,131
in models because it is human behavior at the end of the day. But, you know, how much weight do you,

322
00:28:55,131 --> 00:29:01,891
do you, I guess, put into that? And do you think that, I guess, the three rate cuts for this year,

323
00:29:02,031 --> 00:29:07,871
like one previously, and the two potentially upcoming is already priced in at this point?

324
00:29:09,711 --> 00:29:15,331
That's a great question. I've done some analysis where I look at both rate cut

325
00:29:15,331 --> 00:29:21,551
values historically, and then asset values. But also, importantly, the rate cut announcements,

326
00:29:21,551 --> 00:29:25,831
I think are a big factor, right? Because people front run things and people anticipate what the

327
00:29:25,831 --> 00:29:32,211
market's going to do. So unfortunately, the answer is I don't know. But if I were to guess,

328
00:29:32,811 --> 00:29:39,011
I would say it's a little bit of both. I think that rate cut announcements themselves,

329
00:29:39,531 --> 00:29:44,771
not the rate cuts, but the rate cut announcements, historically have had some correlation to

330
00:29:44,771 --> 00:29:50,791
asset appreciation in the coming months. I don't remember the exact lags, but

331
00:29:50,791 --> 00:29:52,771
But yeah, I think there will be some front running.

332
00:29:53,831 --> 00:30:00,291
I do anticipate more liquidity later on, in part because of these rate cut announcements.

333
00:30:00,291 --> 00:30:09,451
But I think that overall right now, the state of the market and the investment environment is still not great.

334
00:30:09,751 --> 00:30:15,791
And so I think that we still need a lot of that to come back in real terms to start pushing the asset prices up.

335
00:30:16,411 --> 00:30:19,311
I don't know if that's going to be later this year, if it's going to be beginning of next year.

336
00:30:19,311 --> 00:30:23,391
but my expectation is that it's going to be somewhere in that range.

337
00:30:24,511 --> 00:30:34,891
But it would take a lot of inflow now to push the price up to, say, $200,000 by the end of this year at this point.

338
00:30:35,051 --> 00:30:39,331
I mean, now that we're mid-October, and I did some analysis on this,

339
00:30:40,171 --> 00:30:48,011
if you look at the historical trends, it's more likely that we get maybe up into the $150,000 range by the end of the year.

340
00:30:49,311 --> 00:30:53,551
on average of course bitcoin bounces all around all over the place there's a lot of volatility but

341
00:30:53,551 --> 00:30:59,471
sort of nominally maybe 50 150k range and then we're looking at more of the 200 plus k range if

342
00:30:59,471 --> 00:31:05,471
it happens um first quarter or first half of next year this bull run i think everybody should focus

343
00:31:05,471 --> 00:31:10,671
on getting their bitcoin in self-custody and off exchanges we all saw what happened last time with

344
00:31:10,671 --> 00:31:16,831
the huge blow-offs we had celsius ftx all of the big dogs blowing up well this time everybody's

345
00:31:16,831 --> 00:31:20,711
being smart and holding their bitcoin in self-custody this is why i'm going with the number

346
00:31:20,711 --> 00:31:26,891
one hardware wallet in the game that's trezor you can go to trezor.io or the affiliate link below

347
00:31:26,891 --> 00:31:33,711
to get yours for five percent off using promo code greencandle5 get your bitcoin off exchanges in the

348
00:31:33,711 --> 00:31:39,431
easiest way possible they are a trusted brand they've been in the game the longest of any

349
00:31:39,431 --> 00:31:44,251
hardware wallets out there so that's why i've partnered with them making it the easiest for

350
00:31:44,251 --> 00:31:49,611
you to get your Bitcoin off exchanges and not have to worry about any counterparty risks. So do it

351
00:31:49,611 --> 00:31:55,291
today. Go to the affiliate link below. Use promo code GREENCANDLE5. Enough from me. Let's get back

352
00:31:55,291 --> 00:32:00,871
to the show. That's sort of my baseline. Now, where do you think that this, I guess,

353
00:32:00,871 --> 00:32:05,071
the potential top would be? Do you think so? I'm guessing then you think this

354
00:32:05,071 --> 00:32:09,311
cycle leads into 26 and kind of continues that way?

355
00:32:11,311 --> 00:32:17,431
I do. I, I, um, again, I just want to clarify,

356
00:32:17,571 --> 00:32:20,331
I don't know for sure. Not claiming that people say,

357
00:32:20,431 --> 00:32:33,802
what your price prediction I like I don don don take anything You know this is all take it all with a grain of salt Right I in terms in terms of predicting the price in any

358
00:32:33,802 --> 00:32:40,442
given year, especially within the, over the course of months or years, I put not too much

359
00:32:40,442 --> 00:32:46,382
weight into that. I almost do it for fun. The power law long-term is what I'm really, really

360
00:32:46,382 --> 00:32:52,342
put a lot of weight into and I think is speak to the reliability of the asset.

361
00:32:52,902 --> 00:32:57,462
But aside from that, if we're just talking about short term price, yeah, I see us still

362
00:32:57,462 --> 00:33:02,602
possibly breaking 200K. I think it's still realistic. I just don't think it's going to

363
00:33:02,602 --> 00:33:08,062
necessarily happen by December in December this year, which I think that's, again, going back to

364
00:33:08,062 --> 00:33:12,642
some analysts going, you know, what happened to our Bitcoin clock where, you know, every

365
00:33:12,642 --> 00:33:15,582
of exactly four years we hit to this month,

366
00:33:15,662 --> 00:33:17,462
you know, November, December, we hit a price peak.

367
00:33:17,582 --> 00:33:19,402
I just don't think it works that way.

368
00:33:19,422 --> 00:33:20,642
I don't think it has to work that way.

369
00:33:21,782 --> 00:33:27,402
But I'm almost glad because if my theory is correct

370
00:33:27,402 --> 00:33:28,802
that the decay channel holds up,

371
00:33:28,862 --> 00:33:31,042
that actually puts us into the mid 200 Ks

372
00:33:31,042 --> 00:33:33,122
if we end up peaking next year.

373
00:33:35,282 --> 00:33:39,102
You know, so yeah, I'm still expecting,

374
00:33:39,442 --> 00:33:41,242
hoping for north of 200 K.

375
00:33:41,242 --> 00:33:43,622
I don't think that's going to happen by the end of this year.

376
00:33:44,242 --> 00:33:51,822
Okay, now let's get back to retirement here, because I think the Bitcoin as a retirement vehicle is very interesting.

377
00:33:52,022 --> 00:34:11,222
Because, you know, if you just look around at the average retirement accounts, you know, I think if you have like a million dollars or your goal is to have a million dollars and retire in 30 to 40 years at this point, it would, you know, the dollars decaying so much, it would be around like worth 50k worth of 50 purchasing power right now.

378
00:34:11,242 --> 00:34:14,222
just because of how much they're inflating away the dollar,

379
00:34:14,342 --> 00:34:21,282
where on the flip side, Bitcoin is obviously, I guess, a deflationary asset.

380
00:34:22,002 --> 00:34:24,742
And it gets more valuable over time.

381
00:34:25,322 --> 00:34:28,882
So with this, obviously, you need to do some price projections,

382
00:34:28,882 --> 00:34:30,702
which we kind of just went through here.

383
00:34:30,702 --> 00:34:37,002
But what do you think of Bitcoin just in general as revolutionizing the retirement

384
00:34:37,002 --> 00:34:39,622
and all of these different assets, right?

385
00:34:39,622 --> 00:34:44,502
I mean, we're getting, you know, the bond market, fixed income market, potentially real estate.

386
00:34:44,622 --> 00:34:47,742
All of these other markets seem to be getting swallowed up of Bitcoin.

387
00:34:48,042 --> 00:34:54,502
So in a general sense, how do you see Bitcoin just kind of, I guess, Bitcoinizing all of these different areas?

388
00:34:56,482 --> 00:35:01,122
Yeah, I think it's going to be a lot of people's off ramp to being able to ensure some kind of retirement.

389
00:35:01,122 --> 00:35:12,862
I don't know that there's a lot of, you know, reliable options out there for a lot of people, especially because they have a hard time keeping their melting ice cube from melting, you know, their savings.

390
00:35:13,262 --> 00:35:14,982
In this country, it's a serious problem.

391
00:35:15,102 --> 00:35:16,682
I would almost call retirement a crisis.

392
00:35:18,622 --> 00:35:23,922
People, a fewer number of people than ever are expected to have any kind of retirement.

393
00:35:24,862 --> 00:35:26,782
And so the trend there is very concerning.

394
00:35:26,782 --> 00:35:30,542
I think Bitcoin offers hope in that.

395
00:35:31,122 --> 00:35:39,182
And I think a lot of it goes back to its fundamentals, its value proposition as a sort of immaculate ledger, so to speak.

396
00:35:40,022 --> 00:35:46,602
It's a way to preserve energy and time so that you always know what your essentially what your purchasing power is going to be.

397
00:35:47,882 --> 00:35:51,042
And the nice thing about it is it's still being adopted.

398
00:35:51,042 --> 00:35:53,042
So people can actually get some alpha on this.

399
00:35:53,182 --> 00:35:59,962
And still there's a good, you know, I would say 10 plus year window here to take advantage of some pretty extreme gains.

400
00:35:59,962 --> 00:36:06,522
I mean, right now it's doing an average CAGR of 40, what is it? 42, 45%, something like that.

401
00:36:07,242 --> 00:36:16,442
So it's well above of what you'd be achieving with a standard S&P, 401k, which I'm thinking more

402
00:36:16,442 --> 00:36:23,162
and more all the time is a bit of a scam. It's like, how did we all buy into the idea that we

403
00:36:23,162 --> 00:36:28,042
could be sold a product, which is essentially helping you keep afloat with the rate of inflation

404
00:36:28,042 --> 00:36:31,942
over time, but you're not allowed to ever spend it without huge tax penalties.

405
00:36:32,242 --> 00:36:37,242
So I think Bitcoin doesn't have any of that going against it.

406
00:36:37,402 --> 00:36:42,382
So I think, yeah, I think it's an amazing life raft that people ought to start researching

407
00:36:42,382 --> 00:36:44,062
if they have to go already.

408
00:36:44,582 --> 00:36:49,262
Yeah, I think it's interesting because if you look at the S&P 500 just in general, since

409
00:36:49,262 --> 00:36:53,922
the year 2000, I kind of love pointing this out that if you look at it compared to the

410
00:36:53,922 --> 00:37:01,202
M2 money supply, it's just about even and maybe even under value, depending on when you look at

411
00:37:01,202 --> 00:37:07,902
it, depending on the day. So it's actually not even really technically keeping up with inflation.

412
00:37:07,902 --> 00:37:14,242
It's just, you know, kind of breaking even with all that where we're being sold that it's, oh,

413
00:37:14,262 --> 00:37:18,662
it's helping your purchasing power, but then we're being sold these metrics and, you know,

414
00:37:18,662 --> 00:37:24,962
this data that it's just, it's basically one big fat lie where, you know, the, the CPI numbers,

415
00:37:24,962 --> 00:37:29,922
all of the inflationary numbers that they're giving us, it's all just incorrect. And everybody

416
00:37:29,922 --> 00:37:35,862
on main street seems to be feeling it, but, uh, the, the elites on wall street, uh, don't seem to

417
00:37:35,862 --> 00:37:42,262
care. Uh, so I think Bitcoin has been this kind of revolutionary aspect, but, you know, as it stands

418
00:37:42,262 --> 00:37:47,962
right now, you know, Bitcoin is kind of looked at as digital gold, uh, when it comes to the United

419
00:37:47,962 --> 00:37:53,322
States. There's a lot of borrowing products where you can borrow against Bitcoin being used as

420
00:37:53,322 --> 00:38:00,702
collateral. I just interviewed another guest who went into a little bit of the borrowing aspect

421
00:38:00,702 --> 00:38:06,202
and potentially the depreciating APRs with Bitcoin. Now, you took a different approach and

422
00:38:06,202 --> 00:38:14,422
just looked at it as different jurisdictions. So I'm kind of curious, one, do you see Bitcoin going

423
00:38:14,422 --> 00:38:20,582
to potentially a medium of exchange or is Bitcoin kind of one of those assets for you where,

424
00:38:20,782 --> 00:38:22,742
you know, it is that digital gold?

425
00:38:24,142 --> 00:38:25,282
Great, great question.

426
00:38:25,422 --> 00:38:27,562
And yeah, I agree about the S&P stuff.

427
00:38:27,762 --> 00:38:34,882
But the, okay, so something I have thought a lot about, maybe not so mathematically,

428
00:38:34,882 --> 00:38:41,162
but more conceptually, philosophically, is this value, store of value versus medium

429
00:38:41,162 --> 00:38:46,362
exchange narratives around bitcoin and you know people say oh you know it's not it's not peer-to-peer

430
00:38:46,362 --> 00:38:53,882
cash it's not being used that way the way it was designed by satoshi um i start to find when i talk

431
00:38:53,882 --> 00:38:58,042
to a lot of people out there there's more people than i realize that agree with me on this sort of

432
00:38:58,042 --> 00:39:05,562
base case which is bitcoin needs to be adopted first right so what's the more efficient way for

433
00:39:05,562 --> 00:39:09,402
for a financial asset to be adopted?

434
00:39:09,402 --> 00:39:12,842
Is it for it to be a medium of exchange

435
00:39:12,842 --> 00:39:15,842
or is it for it to be a store of value first?

436
00:39:15,842 --> 00:39:17,382
And can it go through different phases

437
00:39:17,382 --> 00:39:19,362
where it fulfills more of one role than the other?

438
00:39:19,362 --> 00:39:22,182
I think the answer is yes to those.

439
00:39:22,182 --> 00:39:25,322
Like, so basically my base case is that

440
00:39:27,122 --> 00:39:30,542
the way that Bitcoin's adoption mechanics are working,

441
00:39:31,562 --> 00:39:33,822
people, yeah, that's why people call it a Ponzi scheme, right?

442
00:39:33,822 --> 00:39:42,842
Like Peter Schiff, it's like people only buy it because they know the next guy is going to, you know, be able to, because you know you're going to be able to sell to the next guy for more.

443
00:39:43,202 --> 00:39:47,342
Like, okay, well, people don't sell it typically right now.

444
00:39:47,422 --> 00:39:55,302
They're holding it as a store of value, which is exactly the reason that most people hold gold or a hedge, you know, protection against debasement.

445
00:39:56,522 --> 00:40:00,742
And so, of course, they're going to use it as a store of value right now, right?

446
00:40:00,742 --> 00:40:14,802
And it's just a cherry on the top that it happens to be, you know, an order of magnitude higher returns than any of the traditional, you know, index funds or things like that out there.

447
00:40:15,302 --> 00:40:29,302
So my theory is that it will eventually become adopted as more of a medium of exchange as it starts to normalize itself into the global economy and become a fully mature asset.

448
00:40:29,302 --> 00:40:37,542
I think it then at that point makes more sense, you know, because then the virus has been the virus has spread, right?

449
00:40:37,622 --> 00:40:40,762
The virus has spread everywhere. Now everybody kind of speaks Bitcoin.

450
00:40:40,962 --> 00:40:43,122
It's functioning in all the different world economies.

451
00:40:46,102 --> 00:40:53,722
And yeah, the early adopters have benefited greatly from from allowing it to to be adopted to that scale.

452
00:40:53,722 --> 00:41:00,982
now what do you think of the uh i guess jurisdictional potential arbitrage with with

453
00:41:00,982 --> 00:41:04,562
all of this i know we kind of just touched on it briefly at the beginning but it seems like

454
00:41:04,562 --> 00:41:10,402
everywhere is getting more friendly towards bitcoin especially you know with uh the crypto

455
00:41:10,402 --> 00:41:16,662
president i always cringe a little bit when i say that about trump but he has been very very positive

456
00:41:16,662 --> 00:41:22,022
when it comes to to bitcoin in the industry but it does seem like it's getting becoming uh or it's

457
00:41:22,022 --> 00:41:27,862
becoming a little bit more of the wild west i'll say uh so what do you think of uh you know these

458
00:41:27,862 --> 00:41:36,242
potential factors when it comes to the adoption uh do you mean just uh like basically how do

459
00:41:36,242 --> 00:41:42,162
different global jurisdictions uh setting policy around bitcoin affect its actual adoption is that

460
00:41:42,162 --> 00:41:53,602
yeah exactly um good question um i guess my thought on that is that it's a bit of a game

461
00:41:53,602 --> 00:41:58,642
i've always kind of like been a subscriber of the game theory uh jason lowry sort of

462
00:41:58,642 --> 00:42:06,142
you know that the dominoes will fall one by one uh i think it's in every nation's best interest

463
00:42:06,142 --> 00:42:10,202
to make their environment attractive to business.

464
00:42:10,802 --> 00:42:13,062
And I think if they don't play along,

465
00:42:13,442 --> 00:42:16,542
then they're going to see business leave.

466
00:42:16,842 --> 00:42:19,762
And I think that we've seen this in certain case examples.

467
00:42:20,682 --> 00:42:22,522
I think that's the direction it's going to go.

468
00:42:22,702 --> 00:42:24,702
I don't necessarily, it's almost like,

469
00:42:25,242 --> 00:42:27,382
again, I almost look at it through like a viral lens.

470
00:42:27,462 --> 00:42:29,542
I almost see like that's Bitcoin doing its job

471
00:42:29,542 --> 00:42:31,662
as you look from country to country.

472
00:42:31,662 --> 00:42:32,842
Like those are the decisions

473
00:42:32,842 --> 00:42:34,162
that they ultimately are going to make.

474
00:42:34,162 --> 00:42:43,702
I don't know if you heard Trump's language before he joined office, and it didn't speak so kindly on Bitcoin, right?

475
00:42:44,082 --> 00:42:46,822
And now we're calling him sort of a Bitcoin-friendly president.

476
00:42:47,102 --> 00:42:51,402
So it's another interesting case, right, where he was all about the dollar.

477
00:42:51,402 --> 00:42:58,182
It's like the idea, just his mindset was totally not mapping onto sort of the Bitcoin or mindset, which I think is really interesting.

478
00:42:58,182 --> 00:43:09,862
And I, yeah, I guess I would predict, to answer your question, those sorts of shifts in global leaders thinking time and time again until the dominoes start to fall all around us.

479
00:43:10,582 --> 00:43:15,882
Now, as you're looking at Bitcoin as an adoption, right?

480
00:43:15,902 --> 00:43:18,562
A lot of people compare it to the adoption of the internet.

481
00:43:19,022 --> 00:43:22,082
This bull run, I'm looking for ways to stack Bitcoin in my sleep.

482
00:43:22,262 --> 00:43:24,302
And mining has always caught my eye.

483
00:43:24,302 --> 00:43:29,642
I've partnered with the guys over at Simple Mining to help you do just that.

484
00:43:30,022 --> 00:43:36,102
I don't recommend anything that I don't use personally, so I've got a machine up and running with them right this second.

485
00:43:36,422 --> 00:43:40,422
And they've even opened the facility up so anyone can go and visit.

486
00:43:41,142 --> 00:43:48,542
They manage over 15,000 machines for 500 clients, handling all of the maintenance and repairs so you don't have to.

487
00:43:48,902 --> 00:43:52,062
And for the Green Candle listeners, they're giving an exclusive offer.

488
00:43:52,062 --> 00:43:55,122
all the repairs for the first year for free.

489
00:43:55,382 --> 00:43:57,242
So if you've been thinking about mining,

490
00:43:57,442 --> 00:44:01,262
head on over to simplemining.io slash greencandle

491
00:44:01,262 --> 00:44:02,922
to get this exclusive offer

492
00:44:02,922 --> 00:44:05,622
and learn about the potential tax benefits

493
00:44:05,622 --> 00:44:08,642
that you can get from mining with Simple Mining.

494
00:44:08,942 --> 00:44:10,182
All right, enough from me.

495
00:44:10,182 --> 00:44:11,502
Let's get back to the show.

496
00:44:11,842 --> 00:44:13,222
All right, a lot of people compare it

497
00:44:13,222 --> 00:44:14,762
to the adoption of the internet.

498
00:44:15,422 --> 00:44:17,922
Have you done a deep dive on this?

499
00:44:18,082 --> 00:44:19,782
And what do you see as like parallels

500
00:44:19,782 --> 00:44:21,702
or maybe some differences in the adoption?

501
00:44:22,062 --> 00:44:39,502
Yes. A while back, this must have been five or six months ago. I think I just did one post on it, but basically the adoption mechanics of the Internet do share a lot of similarities with Bitcoin, which speak to the network adoption nature of it.

502
00:44:40,502 --> 00:44:42,942
Internet being a network, of course, the net.

503
00:44:42,942 --> 00:44:50,442
But one interesting thing is that Bitcoin is being adopted much faster than the Internet was.

504
00:44:51,722 --> 00:44:53,382
Was one feature I recall.

505
00:44:53,502 --> 00:44:54,422
I don't have it in front of me.

506
00:44:54,482 --> 00:44:55,002
So forgive me.

507
00:44:55,082 --> 00:44:56,522
I'm kind of reaching back to my memory.

508
00:44:57,102 --> 00:45:00,182
The other thing was that they both exhibited strong power law behavior.

509
00:45:02,142 --> 00:45:11,182
And I believe globally still, because you can look at each nation's Internet adoption and you can look at the total of the whole world's Internet adoption.

510
00:45:11,982 --> 00:45:17,502
last time i checked i believe because there's so many parts of the world that are still rapidly

511
00:45:17,502 --> 00:45:23,342
adopting the internet um thanks to you know there's new technologies like starlink it still is pretty

512
00:45:23,342 --> 00:45:27,902
much a power law i think the difference is that you're going to start to see because it's not a

513
00:45:27,902 --> 00:45:35,822
financial asset you don't have like you don't have a meta asset attached to it like a money system

514
00:45:35,822 --> 00:45:41,662
so like fiat where you can just print a bunch of money you don't see the internet um

515
00:45:43,982 --> 00:45:48,462
okay so for example in the developed world like in north america it sort of tapers off

516
00:45:48,462 --> 00:45:52,142
so it kind of it's like a power law and then it sort of turns into this like weibull curve or like

517
00:45:52,142 --> 00:45:58,222
an s curve um and that sort of makes sense if you think about it because that you can only have so

518
00:45:58,222 --> 00:46:04,542
many internet users in the world right it's it's only going to have uh you know once once 90 plus

519
00:46:04,542 --> 00:46:10,782
percent of uh your population is using the internet it's like how could it keep trending

520
00:46:10,782 --> 00:46:16,222
as a power law that said i think bitcoin that's where i think bitcoin and the internet differ a

521
00:46:16,222 --> 00:46:25,182
little bit in that there's a financial uh value add so there's a sort of a meta value to bitcoin

522
00:46:25,182 --> 00:46:30,462
besides just holding the bitcoin itself so that's why i think things like whatever your measuring

523
00:46:30,462 --> 00:46:36,542
stick is in terms of purchasing power a poor one fiat or gold i think it's going to have a much

524
00:46:36,542 --> 00:46:43,342
longer standing uh power law behavior uh so that's one of the key differentiating

525
00:46:43,342 --> 00:46:49,822
characteristics between the internet and uh bitcoin in my opinion now you posted this uh

526
00:46:49,822 --> 00:46:57,102
recently about the seven day price integral z score uh where it kind of it's a nice chart and

527
00:46:57,102 --> 00:46:58,982
I'll have my editors stick it in right here.

528
00:46:59,162 --> 00:47:08,162
But it looks like Bitcoin has this gradual, then it kind of has a flat period, then has another gradual big adoption arrow.

529
00:47:09,182 --> 00:47:12,722
And you so eloquently said, but there's no green arrow yet.

530
00:47:13,282 --> 00:47:24,562
So why don't you dive into a little bit of this calculation and kind of what you mean by this and what I guess this could potentially show here going forward.

531
00:47:24,642 --> 00:47:26,782
Obviously, it's not a huge prediction.

532
00:47:26,782 --> 00:47:32,242
It's just usually using past, you know, analysis to try to predict the future.

533
00:47:32,402 --> 00:47:36,782
So I'm curious kind of what you think of this and where it's going.

534
00:47:37,442 --> 00:47:38,042
Yeah, for sure.

535
00:47:38,182 --> 00:47:42,182
So this, I will admit, this is not something I spend the bulk of my time on, but this is

536
00:47:42,182 --> 00:47:47,442
sort of for fun metric exploration and ways to analyze the trend.

537
00:47:48,962 --> 00:47:51,982
And you can clearly see some patterns emerge here, right?

538
00:47:52,082 --> 00:47:55,042
So you see, and I posted this a few times.

539
00:47:55,042 --> 00:47:59,822
you tend to see the shoulder and then a peak and then it goes into a trough and then there's a

540
00:47:59,822 --> 00:48:05,542
shoulder and then a peak and then you go to a trough so right now we're in this sort of yellow

541
00:48:05,542 --> 00:48:13,662
uh you know uh sideways sideways action shoulder phase uh and so the question is like are we just

542
00:48:13,662 --> 00:48:17,982
not going to see a green arrow or do we think we're still going to see a green arrow i still

543
00:48:17,982 --> 00:48:24,182
think we're going to see a green arrow um i without going deep deep into the math and and

544
00:48:24,182 --> 00:48:25,482
and boring your audience,

545
00:48:25,482 --> 00:48:29,342
I will say that the metric here is based on a long time,

546
00:48:29,342 --> 00:48:31,162
long moving time window,

547
00:48:31,162 --> 00:48:33,182
which gives you a nice smooth curve over time,

548
00:48:33,182 --> 00:48:35,222
takes a lot of the noise out.

549
00:48:35,222 --> 00:48:49,493
And it the Z score of the price integral meaning instead of just looking the looking at the um the current price it actually accumulates the price over time and it looks it looks at the

550
00:48:49,493 --> 00:48:54,933
shifts in the trend of the accumulated price so you just add the next day's price to the previous

551
00:48:54,933 --> 00:49:00,693
days to all the accumulated price before so you know it's obviously going to the millions and

552
00:49:00,693 --> 00:49:06,213
millions of dollars so to speak and you can basically see shifts in that if you were to plot

553
00:49:06,213 --> 00:49:11,653
it as a trend line you'd see a bunch of changes in that trend and then what this does is it

554
00:49:11,653 --> 00:49:16,453
basically shows you how many standard deviations it's moving away from that trend so this is why

555
00:49:16,453 --> 00:49:21,413
i don't it's kind of hard metric to explain and i don't do a good job of that in the post but

556
00:49:21,413 --> 00:49:25,253
that's what it's tracking the reason i look at it through this price integral ways i think it's

557
00:49:25,253 --> 00:49:30,533
an interesting way to actually it you start to see this pattern emerge that you wouldn't see by just

558
00:49:30,533 --> 00:49:37,533
just looking at the price in real time or the price history itself.

559
00:49:37,713 --> 00:49:41,033
You actually accumulate that price over time and you see changes in that.

560
00:49:42,313 --> 00:49:45,213
And then you can apply like trend analysis to it.

561
00:49:45,293 --> 00:49:46,373
So that's kind of what this is doing.

562
00:49:47,133 --> 00:49:51,233
So yeah, I think that green arrow is around the corner.

563
00:49:51,233 --> 00:49:55,513
And I think we're not going to see that show up here until after it already happens.

564
00:49:56,293 --> 00:49:56,493
Yeah.

565
00:49:56,673 --> 00:50:00,193
And you have this, I mean, we've been talking a lot about price.

566
00:50:00,193 --> 00:50:08,493
And we've touched on the retirement as well, but you always tweet out this acronym SHISH, which I like, stack early and stack hard.

567
00:50:09,393 --> 00:50:15,573
And you put out another recent about how long it could take to potentially stack 0.1 Bitcoin.

568
00:50:15,893 --> 00:50:23,353
And that's, you know, I do a lot of videos on 0.1 or which is 10 million sats or 1 million sats, 0.01 Bitcoin.

569
00:50:24,093 --> 00:50:38,153
So why don't you take us through a little bit of the math there to kind of show just like, you know, even though we've a lot of people think that maybe we're potentially too late to Bitcoin, that it's still obtainable to get, you know, a good, a good stack here.

570
00:50:38,153 --> 00:50:41,033
You just got to, yeah, hit the sheesh, man.

571
00:50:41,173 --> 00:50:42,873
Just stack early and stack hard.

572
00:50:44,033 --> 00:50:44,453
Correct.

573
00:50:44,833 --> 00:50:45,073
Correct.

574
00:50:45,413 --> 00:50:46,193
So sheesh.

575
00:50:46,413 --> 00:50:47,533
So stack early.

576
00:50:48,033 --> 00:50:51,213
That's so funny that you said sheesh because I've never actually heard anybody else.

577
00:50:51,613 --> 00:50:52,613
Maybe I don't know.

578
00:50:52,613 --> 00:50:53,373
I was thinking so.

579
00:50:53,493 --> 00:50:56,613
Why would you ever hold generational wealth on a piece of paper?

580
00:50:57,033 --> 00:50:58,013
It doesn't make sense.

581
00:50:58,273 --> 00:51:01,793
You need a foolproof solution and I've got it for you.

582
00:51:01,953 --> 00:51:04,113
You can get this as low as $25.

583
00:51:04,633 --> 00:51:07,633
And if you use promo code green candle, you can get 10% off.

584
00:51:07,973 --> 00:51:13,633
Being around for 12 years, they've engineered the perfect and most easy to use solution.

585
00:51:14,133 --> 00:51:17,493
I've partnered with CryptoSteel to offer for you guys just that.

586
00:51:17,733 --> 00:51:21,613
It is the cheapest and most secure way to store your C phrase.

587
00:51:21,613 --> 00:51:27,833
I don't know about you guys, but I don't have too many things where I think one ton is going to fall on this,

588
00:51:27,933 --> 00:51:30,333
but it could survive all of that and more.

589
00:51:31,013 --> 00:51:33,553
So go to CryptoSteel.com.

590
00:51:33,633 --> 00:51:35,433
You can use promo code GREENCANDLE.

591
00:51:35,633 --> 00:51:40,253
You can get 10% off your entire order if you go there today.

592
00:51:40,693 --> 00:51:45,573
So go ahead and protect your generational wealth and do it with CryptoSteel.

593
00:51:45,813 --> 00:51:46,353
All right.

594
00:51:46,453 --> 00:51:47,233
Enough from me.

595
00:51:47,533 --> 00:51:48,213
Back to the show.

596
00:51:48,633 --> 00:51:49,313
I don't know.

597
00:51:49,393 --> 00:51:50,293
I was thinking Sesh.

598
00:51:50,293 --> 00:51:56,433
but that's yeah i like i like the sheesh though i mean i don't know okay well maybe it should be

599
00:51:56,433 --> 00:52:00,793
sheesh okay maybe you take ownership over the pronunciation of that i'm totally fine with that

600
00:52:00,793 --> 00:52:09,953
um yeah basically this chart it's time to stack 0.1 btc by dca so what this is looking at uh is

601
00:52:09,953 --> 00:52:16,273
that a couple things one is that if that's your uh stacking target 0.1 bitcoin i think that's

602
00:52:16,273 --> 00:52:20,913
very respectable, especially depending on where you live, what jurisdiction you live in and what

603
00:52:20,913 --> 00:52:26,913
your expenses are expected to be. That said, the key with Bitcoin is you just need to start.

604
00:52:27,233 --> 00:52:31,693
You just need to, the longer you wait to start getting in, you can see these lines start getting

605
00:52:31,693 --> 00:52:37,873
further and further apart. And the kind of the X axis is showing how much you're stacking per week.

606
00:52:38,193 --> 00:52:43,773
And then each of those lines is a starting year. And then the Y axis is how many years it's going

607
00:52:43,773 --> 00:52:52,393
to take to reach that goal, which is 0.1 BTC. So you can see that if you want to say $400 a month,

608
00:52:52,633 --> 00:52:58,973
right? That's $100 a week. You could start right now and it would still take you to hit a 10th of

609
00:52:58,973 --> 00:53:08,093
a Bitcoin just over two years, right? But if you wait to start until, let's just say 2030,

610
00:53:08,393 --> 00:53:12,773
let's just use round numbers, right? You wait five more years and say, okay, I'm going to start my

611
00:53:12,773 --> 00:53:18,313
DCA plan and I'll put in a hundred dollars a week. Well, now you can see it's going to take you about

612
00:53:18,313 --> 00:53:24,473
12 years to reach that same starting, uh, that same stacking target. Um, and you can do the same

613
00:53:24,473 --> 00:53:30,993
math for one Bitcoin. It's, you just, it's basic algebra, but the, the, the, the price trajectory

614
00:53:30,993 --> 00:53:36,873
is all based on the power law, uh, trend. So, um, that's what it all comes back to.

615
00:53:38,313 --> 00:53:42,693
Yeah. So is it, is it too late to get to one Bitcoin? Is that what you're telling us here?

616
00:53:42,693 --> 00:53:50,733
smitty it depends on how much cash you have um you know it's harder and harder all the time to

617
00:53:50,733 --> 00:53:57,373
reach one one bitcoin indeed is going to be like a lot of people say is going to be like um you know

618
00:53:57,373 --> 00:54:01,373
what what the goal the goal used to be to try to get to 10 bitcoin right everybody's the average

619
00:54:01,373 --> 00:54:06,293
person's like am i going to get a stack 10 bitcoin now it's going to be difficult for people there's

620
00:54:06,293 --> 00:54:10,573
another chart here i don't know if you end up pulling it up but if you take the same approach

621
00:54:10,573 --> 00:54:16,893
to a lot of people $400 a month that's a lot of money right so right now if you were to do that in

622
00:54:16,893 --> 00:54:26,493
2025 I mean good luck trying to get one bitcoin it's going to take you like 35 years um and that's

623
00:54:26,493 --> 00:54:32,053
shocking to hear it put that way by some people but that's just the fact one bitcoin is is a lot

624
00:54:32,053 --> 00:54:39,853
um if now if you want to put in uh you know let's say what's 500 you want to put in two thousand

625
00:54:39,853 --> 00:54:44,273
dollars a month which some people might be able to pull that off with like a really good job you

626
00:54:44,273 --> 00:54:48,713
know and they got their finances under control and you want to put in five hundred dollars a week or

627
00:54:48,713 --> 00:54:53,473
two thousand dollars a month and you start this year then you're talking you could you could pull

628
00:54:53,473 --> 00:54:58,973
that off in about four and a half years if you start right now in 2025 to one to get to one

629
00:54:58,973 --> 00:55:04,873
but you know that's that's you got that's this is dca so you can't miss can't miss a couple

630
00:55:04,873 --> 00:55:10,713
months here and there it's like and then and then again if you want to wait till let's say 2030

631
00:55:11,833 --> 00:55:18,073
and that same two thousand dollars a month again is going to take you about uh looking here like

632
00:55:18,073 --> 00:55:23,753
you know close to 30 years so don't wait around stack early and stack hard that that is the

633
00:55:24,313 --> 00:55:29,993
that's what these charts are meant to to uh communicate yeah communicate that the growth

634
00:55:29,993 --> 00:55:35,353
is exponential here. So, you know, it seems like all of these numbers, even though I feel like

635
00:55:35,353 --> 00:55:40,673
they're a little conservative, the conservative numbers are still extremely bullish. So is there

636
00:55:40,673 --> 00:55:45,493
anything that you see as a potential, I don't know, black swan or something that worries you

637
00:55:45,493 --> 00:55:49,893
about the adoption going forward? Or have you run that thought experiment a million times like the

638
00:55:49,893 --> 00:55:56,893
rest of us and just maybe you can't find anything at this point? Man, that's a great question. So I

639
00:55:56,893 --> 00:56:04,413
have thought a lot about um the different fail so in my in my uh in my my day jobs i've spent a lot

640
00:56:04,413 --> 00:56:10,173
of time doing failure analysis and reliability work and so um i like to think about a system

641
00:56:10,173 --> 00:56:14,973
and its points of failure and its uh probability of failure and kind of look at things like a

642
00:56:14,973 --> 00:56:20,493
probabilistic tree so i haven't done to be honest i haven't done a fully fleshed out mathematical

643
00:56:20,493 --> 00:56:24,813
analysis on this but i will take what i see to be the biggest threats of bitcoin to see what the

644
00:56:24,813 --> 00:56:29,273
the likelihood of those things would be. The easiest ones, the lowest hanging fruit, if you

645
00:56:29,273 --> 00:56:32,993
think about those are like the world ending scenarios, right? Where it's like, we're all

646
00:56:32,993 --> 00:56:38,673
back, we're pushed back into the dark ages. There's no electricity, a meteor has hit the earth and

647
00:56:38,673 --> 00:56:45,473
it's okay. Well, like, okay. Like we have much, much bigger problems to worry about than how

648
00:56:45,473 --> 00:56:50,313
Bitcoin is doing at that point, right? The internet gets shut off and forever and never

649
00:56:50,313 --> 00:56:56,493
gets turned back on. Okay. We're kind of in a similar boat. I think I'm trying to keep an eye

650
00:56:56,493 --> 00:57:04,573
on this quantum computing thing. I'm by no means a quantum computing expert, but what the experts

651
00:57:04,573 --> 00:57:10,993
are saying and what the trends are saying is that it's going to threaten the protocol and access to

652
00:57:10,993 --> 00:57:16,853
keys in not too long a timeframe from now. So it's something that we're going to have to adapt to

653
00:57:16,853 --> 00:57:22,913
at the very least. So I think sort of in the next five to 10 year timeframe, we're going to have to

654
00:57:22,913 --> 00:57:28,313
see some solutions arise from the Bitcoin developer community on that. But there are ways.

655
00:57:28,833 --> 00:57:34,173
The good news on that is that I know for sure that there are ways to become quantum resilient.

656
00:57:35,493 --> 00:57:39,493
And so I don't think that that's, I think it's a threat to Bitcoin, if we're being honest,

657
00:57:39,493 --> 00:57:45,673
but I think it's not something we can't adapt to prevent from being a catastrophic failure.

658
00:57:45,673 --> 00:58:00,293
Now, coming at this from a mathematics perspective, I always think is very interesting. I have an engineering background and a lot of what I have learned about economics has just been purely self-taught.

659
00:58:00,293 --> 00:58:06,613
um you know a lot of what i learned is actually from preston pish in the show we study billionaires

660
00:58:06,613 --> 00:58:12,933
talking about a lot of analysis uh and you know one thing that kind of i guess dissuaded me from

661
00:58:12,933 --> 00:58:19,893
all of this was just looking at the amount of craziness during the 2020 times with the gme

662
00:58:19,893 --> 00:58:26,213
craze seeing covid and uh you know basically the short squeeze aspect of all of it and you know

663
00:58:26,213 --> 00:58:29,373
not really being able to explain what the hell was going on.

664
00:58:30,593 --> 00:58:35,393
And it seems like Bitcoin is almost in a similar perspective

665
00:58:35,393 --> 00:58:41,113
where a lot of people try to put mathematical equations on it,

666
00:58:41,493 --> 00:58:44,293
but I don't know if there's an asset quite like it.

667
00:58:44,293 --> 00:58:48,693
So when you're doing your dives with Bitcoin analysis

668
00:58:48,693 --> 00:58:51,173
and kind of looking at it in that respect,

669
00:58:51,173 --> 00:58:58,273
um do you still see it as like the potential of uh i guess like breaking out or what kind of

670
00:58:58,273 --> 00:59:04,753
reasonings did do you see that it's still following this mathematical model of like the

671
00:59:04,753 --> 00:59:11,233
power law per se yes okay so yeah so a little bit of background on how i got into things and

672
00:59:11,233 --> 00:59:18,133
what are the things that really can help me to want to um do this i guess semi-professionally

673
00:59:18,133 --> 00:59:24,753
although I didn't intend that initially. So I, like you, have an engineering background. I have a PhD in material science and engineering.

674
00:59:25,533 --> 00:59:33,233
I did some science-y stuff before that, but I am totally not in economics or finance at all. That's not my background.

675
00:59:33,753 --> 00:59:38,493
But what I do have a background in is a lot of data analysis, right? And like you just said, for yourself.

676
00:59:38,673 --> 00:59:44,093
And so one of the things that really drew me into this to take this seriously as an asset,

677
00:59:44,093 --> 00:59:48,813
I had kind of multiple awakening points or I call them clicking points when things kind of click.

678
00:59:50,573 --> 00:59:55,853
And one of those was when I actually saw the power law for the first time, I saw some people

679
00:59:55,853 --> 01:00:01,853
analyzing the power law and I just looked, to be honest, I just, the feeling I got from seeing this

680
01:00:01,853 --> 01:00:10,573
straight line plotted out when you look at things in a log log space, I was like, I don't think,

681
01:00:10,573 --> 01:00:16,013
think, okay, this is interesting, right? And then so it's a very simple model, because I knew what

682
01:00:16,013 --> 01:00:21,753
power laws were, because of the systems that I work with. And so I said, can I, this simple of a

683
01:00:21,753 --> 01:00:28,453
model fit the entire history of Bitcoin that well? Of course, there's going to be noise, but so I just

684
01:00:28,453 --> 01:00:33,853
started doing it on my own. It wasn't that difficult to do, you know, we all know how to pull data from

685
01:00:33,853 --> 01:00:38,713
different databases and data sources. So yeah, I started putting a lot of my own analytics together

686
01:00:38,713 --> 01:00:43,493
and looked at traditional regression approaches.

687
01:00:44,693 --> 01:00:46,513
And then I very quickly started to realize

688
01:00:46,513 --> 01:00:49,473
that there seems to be an underlying power law here.

689
01:00:50,373 --> 01:00:52,813
And then the other, by the way,

690
01:00:52,913 --> 01:00:53,713
as sort of an aside,

691
01:00:53,833 --> 01:00:55,113
every time with Bitcoin,

692
01:00:55,653 --> 01:00:56,973
I've had sort of an awakening,

693
01:00:57,473 --> 01:00:59,033
strengthening of conviction of Bitcoin.

694
01:00:59,273 --> 01:01:02,853
I then put in proportionally more investment into it,

695
01:01:03,193 --> 01:01:03,933
a personal investment.

696
01:01:04,353 --> 01:01:07,173
So that's kind of an interesting progression on my end.

697
01:01:07,173 --> 01:01:08,673
But yeah, so I did that.

698
01:01:08,713 --> 01:01:35,333
And then I very quickly noticed that there's like a power law trend here. Why is that? Like, where is that coming from? Why do stocks not behave like this? And then that got me to really discover more about network processes, which I'd never really thought about too much before. I read that book Scale by Jeffrey West. I don't know if you've read that yet, Brandon.

699
01:01:35,993 --> 01:01:36,833
No, I have not.

700
01:01:36,833 --> 01:01:53,933
That's a great book recommendation. It's basically a walkthrough of all sorts of different systems in nature and socioeconomics and cities where the underlying growth structure is based on a power law.

701
01:01:53,933 --> 01:01:57,533
They call them scaling laws. It's kind of like an alternative name for power law.

702
01:01:58,653 --> 01:02:04,813
And to me, Bitcoin now, looking back and having done all this research, it is following a scaling law.

703
01:02:05,173 --> 01:02:07,753
You see all the different orders of magnitude that it's scaled.

704
01:02:08,693 --> 01:02:14,213
And so we sort of see it repeat the same old patterns going forward.

705
01:02:14,213 --> 01:02:23,693
But it takes longer and longer, but it reaches greater and greater orders of magnitude of scale.

706
01:02:23,933 --> 01:02:25,513
So, yeah.

707
01:02:26,953 --> 01:02:28,413
Yeah, it's very interesting.

708
01:02:28,693 --> 01:02:33,093
And I'm, yeah, I like that you've got the engineering background similar to me, because

709
01:02:33,093 --> 01:02:39,293
I think when you get into these economics modeling, a lot of stuff just, you know, is

710
01:02:39,293 --> 01:02:46,453
taken for, I guess, assumptions that need to, I guess, you know, it just, it's the way

711
01:02:46,453 --> 01:02:47,173
it's been, right?

712
01:02:47,233 --> 01:02:50,213
Like the KZNX economics, all of these different aspects.

713
01:02:50,213 --> 01:02:52,993
So everybody's just like, oh, you know, this is how it should be.

714
01:02:52,993 --> 01:02:57,573
this is what we need because this is what we filled out in the textbook. But trying to describe

715
01:02:57,573 --> 01:03:03,313
all of this is, you know, I think a reason I see a lot of engineers, even if they're not doing

716
01:03:03,313 --> 01:03:07,973
stuff like you're doing, like kind of getting into the Bitcoin space, because we're always

717
01:03:07,973 --> 01:03:13,593
trying to figure ways out and trying to explain things at a deeper route. And I feel like a lot

718
01:03:13,593 --> 01:03:20,013
of the economists don't necessarily do that. But I really enjoy your work and enjoy all of the,

719
01:03:20,013 --> 01:03:24,553
you know, mathematical breakdowns you've got going on. So why don't you tell people where

720
01:03:24,553 --> 01:03:31,233
they can find more of that and, you know, follow along? Yeah, thanks a lot, Brandon. I appreciate

721
01:03:31,233 --> 01:03:39,033
the discussion. I am purely on X right now. So find me at smidston, what is it? smidston underscore

722
01:03:39,033 --> 01:03:48,333
with on X. And sorry if that's hard to pronounce. But then I am bringing up a website by the end of

723
01:03:48,333 --> 01:03:54,233
the year. It's not done yet, but my plan is to bring up my own website. It'll be smidstonwith.com

724
01:03:54,233 --> 01:04:01,133
and it'll basically have everything from my charts and analysis to kind of a blog style

725
01:04:01,133 --> 01:04:05,493
thoughts and, you know, like kind of the more philosophical things that you and I are talking

726
01:04:05,493 --> 01:04:11,093
about, as well as a lot of the retirement types of tools I'll have on there as well, which I'll

727
01:04:11,093 --> 01:04:17,073
be updating. Yeah. So keep an eye out for that. Yeah. And I'll put all that in the show notes.

728
01:04:17,073 --> 01:04:18,573
And yes, Smitty, I'm not going to lie to you.

729
01:04:18,653 --> 01:04:20,453
Your name is a little tough to pronounce.

730
01:04:20,693 --> 01:04:23,473
It's not as basic as a Brandon.

731
01:04:23,733 --> 01:04:26,973
But hey, I appreciate all your work and you're a great follow.

732
01:04:27,153 --> 01:04:28,853
So I'll put all that in the show notes.

733
01:04:28,993 --> 01:04:30,773
Highly recommend everybody to check them out.

734
01:04:31,133 --> 01:04:32,253
And thanks for coming on.

735
01:04:33,173 --> 01:04:33,793
Thank you, Brandon.

736
01:04:33,953 --> 01:04:34,753
Yeah, great being with you.

737
01:04:34,793 --> 01:04:35,313
I appreciate it.

738
01:04:35,673 --> 01:04:40,093
Thank you guys all for tuning in to another great episode of the State of Bitcoin podcast.

739
01:04:40,513 --> 01:04:44,453
If you found some value in this one, please hit that subscribe button and that like button

740
01:04:44,453 --> 01:04:45,873
to help send this one to the masses.

741
01:04:45,873 --> 01:04:47,373
and I've got a surprise for you guys.

742
01:04:47,493 --> 01:04:48,713
I've got two more episodes

743
01:04:48,713 --> 01:04:50,733
that you have the chance to watch here.

744
01:04:50,853 --> 01:04:51,973
So go ahead and click one of them

745
01:04:51,973 --> 01:04:53,733
and I'll see you guys all at the next one.