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There's three levels to wealth creation.

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So level one is you don't have any knowledge of how the financial system works.

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You go to your job, you earn an income, and you save in dollars.

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Level two is you know that the currency is going to lose value.

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So you go to a job or you start a business, and the income you produce,

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you save it in assets, either Bitcoin, equities, real estate, whatever.

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Level three, and this is where I've tried to position myself this year.

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Something that happened really recently as well as Jack Mahler's, his account got frozen at Chase Bank.

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How do you view this whole situation between JP Morgan and MSTR?

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I think JP Morgan is positioning themselves to launch their own competitive product.

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Basically, products that would compete with MicroStrategy's preferred equity.

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Now, on the big print, I think the last thing I want, and I know he doesn't want this either, is hyperinflation.

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And I absolutely do not want that, even though it would probably send Bitcoin to $10 million.

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There's a quote from an early 20th century judge,

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and he said, there's two systems of taxation, one for the educated and one for the uneducated.

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So long story short, Bitcoin...

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candle content. So make sure that you're hitting that subscribe button with the bell notification

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so you get notified every time I drop a video. All right, now let's get back into this great

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interview. Bing bong, I am back with another edition of the State of Bitcoin podcast where

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I've got the man, the myth, the legend, Mitchell Askew, also known as Mitchell Hoddle on X.

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This is his second time back on the pod. It's been a minute, but Mitchell, there's so much going on

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right now with strategy and JP Morgan and the potential of a coordinated attack.

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And then today we're recording this on Tuesday. I believe it is December 9th and 21 is actually

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set to go public today. So there's a lot going on here. But do you think that the banks are seeing

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some sort of, I guess, let's call it way to attack Bitcoin through micro strategy and strategy here

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because they're losing control. How do you view this whole situation between JP Morgan and MSTR?

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I think JP Morgan is positioning themselves to launch their own competitive product,

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which we saw them file for basically a levered version of iBit recently. And I fully expect them

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to go further down that route and offer basically products that would compete with MicroStrategy's

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preferred equity, some sort of Bitcoin-backed credit. JP Morgan, they're an authorized participant

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within the Bitcoin ETFs. They may vocally posture themselves as anti-Bitcoin, but they're certainly

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positioning themselves to benefit financially from Bitcoin. So I think any hostility towards

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strategy is simply a competitive business tactic. Yeah, but it's interesting because they did launch

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that like Bitcoin bond type of preferred stock offering, which is essentially just a direct

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competitor to what strategy is doing. But they released a new price prediction. I believe it was

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like 170K, maybe 150, somewhere in there. And part of the reasoning that they cited was strategy's

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resilience with all of this. So I feel like they're sort of playing the media in a sense.

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So do you still think that, I mean, even with as big as the banks are,

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even though people are starting to wake up to the fact that, you know,

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the banking system is corrupt, that they still have kind of a finger hold on the media

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and they're able to control the narratives around all these things?

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Absolutely. I mean, what's the number one way to have power?

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It's to have money. And who has the most money? It's the banking system.

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And so, yeah, absolutely.

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They're going to be able to pull strings within traditional financial media to get a certain narrative across.

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And if it wasn't for people like you, Brandon, and other independent Bitcoin content creators and the free speech platform of X and Rumble, I'm not sure we'd have nearly enough information to get kind of a complete picture.

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Yeah, I mean, hey, thanks, man.

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You're doing a great job yourself as well.

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So don't just give me all the credit here.

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But I mean, we're coming to you live here at the opening bell, just about that time of 21 going public.

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Now, I think you did an interesting piece about all of the connections here.

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So why don't you dive into that?

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What do you think of 21?

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Do you think that they're going to be able to reach the goal of actually beating strategy?

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Because I think right now, strategy has 660,000 Bitcoin on the balance sheet.

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The next closest has $50,000.

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So do you think that they're going to able to do what they're setting out to do

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and take over that number one spot as top Bitcoin holder on the balance sheet?

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I think there is a possibility.

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I think it's a greater than 0% chance for any other company.

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I would say it's a 0% chance.

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I don't think it's necessarily likely.

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I would give it maybe a 10% to 20% likelihood.

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But I do think it's possible.

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If there's any company that can do it, it would be 21%.

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And there's four major players involved in 21.

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You have Cantor, Tether, SoftBank, and Jack Maulers.

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Now, Jack Maulers is mostly the face of the company.

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I'm a huge fan of Jack Maulers, and I don't think they could have picked a better face.

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He's very skilled at articulating Bitcoin.

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He's already built one of the most successful Bitcoin exchanges.

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And he's also worked with nation states previously.

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He's pretty much the primary reason El Salvador adopted Bitcoin as legal tender four years ago.

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But the three other players, Cantor, they're a primary dealer with the Fed. So they're directly

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buying and selling the US government debt with the Federal Reserve. You have Tether,

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who is the 17th largest holder of US treasuries, and they're quickly rising the ranks there.

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They're the fastest growing source of treasury demand. And when we zoom out big picture macro,

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what's the problem? There's $39 trillion in debt. The United States is running out of entities to

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buy their debt. So you can see where they're going to want to ally with someone like Tether

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under the fact that foreign countries aren't buying the US debt anymore.

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Large scale banks after Silicon Valley Bank went under for holding too many US treasuries,

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they're a little bit susceptible to not buying as many treasuries. And then the only other

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large scale treasury buyer would be pension funds that are mandated to do so. And then the third

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partner would be SoftBank. And this is where I think it all gets very, very interesting because

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I had, I'd never heard of SoftBank. They're domiciled in Japan. So as I started researching

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them, I realized earlier this year, they went into a public private partnership with the United

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States government on an AI infrastructure project. And that's its own rabbit hole, but it's Stargate,

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OpenAI, Oracle, and then an Abu Dhabi sovereign wealth fund. And so this really sets a precedent

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that this entity in particular is willing to work directly with the government. Now, AI is one

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avenue that the government has certainly a vested interest in making the United States the leader

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in, right? You wouldn't want a competitive nation like China or Russia to lead in AI.

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Another industry, you would want the government to lead. If you are the United States government,

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you want to be the leader in Bitcoin. And they've been more than vocal about this over the past two

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years. So knowing that SoftBank is already willing to work with the government directly

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on a partnership, I wouldn't say it's too far-fetched to conclude that 21 might be headed

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that direction. Cantor's former CEO is now the Secretary of Commerce, Howard Lutnick.

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Obviously, Tether has this really tight relationship with the US Treasury being one of the largest

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buyers of US debt. And I think all the pieces of the puzzle, you start to put it together,

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It's very interesting. And I think 21 is going to likely become some sort of like quasi-public-private institution.

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Yeah, let's keep diving into that because I think there is like kind of a unique connection between the government, Tether, and, you know, Howard Lovenick and Kenner Fitzgerald.

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I mean, outside of the obvious one where, you know, Howard Lovenick directly left Kenner Fitzgerald to go to the government.

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But there's also Bo Hines, who directly left the government to go help work with Tether.

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So it seems like they're all very intertwined with each other.

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And so how would this, I guess, public partnership kind of look in your opinion?

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Would it be something like Intel, where 21 would be potentially stacking for that Bitcoin strategic reserve?

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or would there be some other incentive outside of the Bitcoin on the balance sheet play

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that the government would want to partner with 21?

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I think it's two primary objectives they want to achieve here.

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One would be accumulating Bitcoin for the strategic reserve for sure.

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And then second would be to promote more treasury demand.

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So all year long, the Secretary of the Treasury, Scott Bessent, has been trying to pull different levers to get the long-term interest rates down.

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Because if you have $39 trillion in debt, you do not want to be refinancing that at high interest rates, right?

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You want to get the interest rates down.

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They tried to cut spending at the federal level with Doge.

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They tried tariffs to raise capital immediately to kind of alleviate the deficit.

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They've been jawboning the bond market and Jerome Powell all year long trying to get rates down.

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None of it has really worked. The 10-year rate is still above 4%.

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And so what I'm envisioning would be 21, given Cantor's position as a primary dealer with the Fed,

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Tether's relationship with the Treasury, I would expect them to issue some sort of Bitcoin-backed credit instrument.

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MicroStrategy has already basically done the proof of concept for this with their preferred equities.

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I would imagine it looking something like a bundled note that has either a five-year treasury or a 10-year treasury note plus some amount of Bitcoin.

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So if you're a lender, you would be willing to accept a lower interest rate on that note compared to the 10-year because there would be some sort of embedded Bitcoin upside that would likely get split between 21.

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And that would be their balance sheet asset.

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And then it would go back to the investor at the end of the term.

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And then so the government is now basically tapping into new pools of demand to bring that demand ultimately to the treasury market, right? Because what 21 would do when they issue these notes is they would take a majority of that capital, go buy 10-year treasuries or 20-year treasuries or whatever, and then buy a little bit of Bitcoin.

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And from an investor's perspective, you're getting the security of AA, AAA rated treasury notes with Bitcoin upside.

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The government gets a new source of treasury demand and 21 gets to stack Bitcoin.

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This is all speculation and there's no hard evidence to prove that they're going to do this.

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But this, I believe, given the players involved, is probably of a high likelihood that they do some sort of instrument like this.

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Yeah, and I think it's interesting, too, when you look at, you know, the stable coins, how the U.S. government really made an effort to pass the Genius Act.

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That was the first kind of policy that they went in.

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And, you know, I've been covering it a lot on how I think the potential of, you know, utilizing Tether and Circle, because these are essentially the only two players that they have in stable coins.

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You know, utilizing these guys is almost like backdoor CBDCs in a sense, or at least the ability to control them.

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I mean, Tether and Circle have already frozen accounts before and already worked pretty closely with the government.

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So they have close ties.

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And then, I mean, I think it is kind of quote unquote genius in a sense where they've been essentially seeing the decline of, you know, governments around the world for U.S. debt.

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You know, nobody's buying up U.S. Treasuries.

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They're actually selling it off.

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But who else could potentially start to scoop up some of that lost demand?

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And it would be stable coins because, you know, at the end of the day, everybody wants the U.S. dollar, especially if you're in countries like Argentina, Turkey, you know, the Zimbabwe is where, you know, your currency just isn't as as poorly.

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And checkmate kind of opened my eyes to this. And it's essentially, you know, the poor countries then funding the U.S. Ponzi scheme to keep going on.

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So I think it's, you know, still a dynamic that has been around forever.

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It's just now we're putting it digitally and doing it on the blockchain, so to speak.

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So, you know, third world retail investors are going to be the bag holder for the U.S. debt.

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They're the final untouched pool of capital that doesn't have access to dollars.

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And so, of course, they're foaming at the mouth to get out of the Argentine peso or the Turkish lira or whatever and hold dollars.

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But then the stablecoin issuers take those dollars and buy treasuries.

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And then ultimately, a stable coin is stable in name only, right?

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Because it is one-to-one backed by the US dollar, which is constantly eroding in value.

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Yeah.

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So how do you see, I mean, I guess with Tether's kind of new, unique partnership here.

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So, I mean, even outside of 21 with Tether, Canterford-Scherrold and, you know, Howard Lubnick, that sort of connection.

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Do you see this as like a potential?

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Because I mean, right now, Circle is the biggest stablecoin.

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Obviously, they're launching USAT at Tether.

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But how do you see this playing out here on the stablecoin side?

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Yeah, I would not bet against Tether.

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And Circle has had the favorable regulatory moat for some time,

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given Coinbase has been public in the United States for a while.

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It certainly seemed like a lot of the operation choke point during the Biden administration

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was creating a bit of a regulatory moat for Circle.

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Now that the market opened up a little bit more and we certainly know that there are members of the Trump administration like Howard Lutnick who have a vested interest in Tether I would not be

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betting against Tether at all. And you brought up an interesting point earlier, which is about them

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being a central bank digital currency. I'm not saying they are, but if you were going to issue

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a central bank digital currency, you would do it through a private entity. We've seen the government

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used private entities to do their bidding previously. A good example of this would be

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online censorship was enforced by big tech, right? Because the government themselves,

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they are basically blocked by the First Amendment from censoring people in their speech.

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But there is a lot of wiggle room for a private entity. It's just a private company,

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they can censor speech. Well, logically, you would assume that they could also find the same wiggle

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room with censoring monetary transactions. And so people would be very resistant, especially

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within the United States, given the history of our country and the resistance to government

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control. People would resist the CBDC if it came directly from the Federal Reserve.

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But if it's, quote unquote, only from a private company, I think you would see a lot more people

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capitulate to such an instrument, although the function of it would likely be the same,

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You would be able to freeze certain transactions, certain wallets, and really restrict commerce to only specific goods and services.

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Yeah, I mean, I think this whole dynamic is something that I think almost Bitcoiners have taken the eye off the ball, so to speak, because now we have a quote unquote crypto friendly administration.

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But now everybody's saying, you know, everything for Bitcoin is good.

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But the push for stable coins, I think, is really, really interesting.

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And, you know, something that happened really recently as well is Jack Mahler's, his account got frozen.

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proven. It's good, but the push for stable coins, I think is really, really interesting. And,

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And, you know, something that happened really recently as well was Jack Mahler's, his account got frozen at Chase Bank and JP Morgan.

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So, I mean, I think that these attacks are still prevalent.

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And you brought up choke point 2.0.

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Senator Lummis actually had a tweet saying that these policies still live on.

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I don't know if, you know, that's just because of what happened with Jack or if she knows something else.

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But what is your thought on all that?

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Do you think that the choke point 2.0 policies are completely done with just because of the new admin here?

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I would have said yes until this situation with Jack Maulers recently that you pointed out, right?

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It's a guy who runs one of the most known Bitcoin exchanges in the country.

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He certainly has a very high net worth.

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And here he is getting debanked from JP Morgan.

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It's a little suspicious, although I think we've certainly made a lot of progress over the last couple of years, even this year alone.

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I think the biggest release of choke point chains was the change in the FASB accounting rules that happened late 2024.

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That's what opened the floodgate for the Bitcoin treasury companies.

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Bitcoin was actually able to become marked appropriately on public balance sheets.

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And so we're starting to see Bitcoin hit escape velocity. That's not to say there won't be hiccups like this Jack Mahler's Chase Bank situation along the way. But I think we've made a lot of progress as an industry over the past couple of years.

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And I'm fairly optimistic that by the time Trump's second term ends in 2029, that Bitcoin will be essentially too big to fail that even if you got a hostile administration in 2029, that they wouldn't really be able to do much at that point to hinder our progress as an industry.

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yeah i mean hey that's a fair point and hopefully we're in a little bit different i mean place here

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than uh than we're at right now at least with like the price action because yeah you know seeing the

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the recent drawdown but i think you know now that trad fi is kind of in this is uh kind of i guess

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par for the course like everybody was thinking of by the end of this year and myself included

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that we would see bitcoin absolutely rip and uh we would see some some craziness going on here

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in Q4, but unfortunately, that hasn't happened, at least yet. Maybe. I mean, there's still

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two or three weeks left in the year, so maybe we could see something crazy. But

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as this market has been developing over time, what do you think has been the biggest change in

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catalyst this year? And how do you see us in this market now? Do you think the bull run is over and

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and that's going to start to change the dynamics here?

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The biggest change in the market is that we have an entirely different investor cohort

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driving the price action.

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So for the first 15 years of Bitcoin's existence until January 2024,

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it was a, quote-unquote, speculative retail-driven asset.

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It's no wonder you had these massive boom and bust cycles

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when that was the primary cohort of people buying and selling Bitcoin.

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Now it's totally different.

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The ETFs were the starting gun, but it's been one news event after another, one new Bitcoin

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product after another, one preferred equity.

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And then you've got JP Morgan launching their own Bitcoin product.

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All of these things are just further interconnecting Bitcoin and traditional markets.

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And as that connection becomes more solid, Bitcoin is going to begin trading like an

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institutional asset, which is what we've seen.

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And it's going to be lower volatility than it has historically been.

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And you're going to see investors be fairly disciplined in buying dips, as well as selling into strength, right?

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You know, retail Bitcoiners, we're not content unless we get 100 extra turns.

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That's not the institutional participants who are in the market now.

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They'll take a 50% return and cash out, take their profits, whatever you want to say, and run home.

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And so I'm very confident that 2026 is going to be a green year for Bitcoin. I think the four-year cycles, one, I don't think we have nearly a large enough data set to really like, you know, marry that idea as a concept. I think it's a little foolish to begin with.

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And additionally, I think Bitcoin is now just going to be far more correlated to the larger macroeconomic picture, global liquidity, risk on versus risk off environment. So I personally don't see any reason to be bearish going into 2026.

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I know a lot of people are, I think there's almost this self-fulfilling prophecy where people sold in Q4 of this year because they are so convinced that there's got to be another 75% drawdown.

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You go up and you go down every four years.

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This is what Bitcoin has done for the first decade and a half of its existence.

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And so I think that kind of played into why Bitcoin's price is where it's at.

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But when you really break down how much sell pressure there was this year, it's incredible that Bitcoin is only down 30% from peak to trough right now. Bitcoin, if you look at the ETF inflows, for example, they had net inflows of $57 billion this year.

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Now imagine the same amount of inflows, but you don't have these hordes of OG Bitcoiners selling at 100K.

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This could very well be the case in 2026, right?

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These inflows have basically been nonstop.

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They go up and down, but generally up and to the right.

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These Wall Street investors are continuously accumulating Bitcoin.

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Eventually, the class of 2017 and the class of 2020 and 2021, they're going to run out of coins they're willing to sell.

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I think we're going to start to see that play out over 2026.

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But these inflows from Wall Street are not stopping.

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So I'm very bullish on Bitcoin over the next year, next three years, next 10 years.

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And anybody who's trying to trade this market, I think you're going to get burned.

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Yeah, so I mean, I agree with you there too.

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I mean, I'm extremely bullish going into 26.

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But what I think is interesting, kind of what you brought up,

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traditional finance, there's different investors.

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But now the institutions are coming in.

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What do you make of this, I guess, Bitcoin on the balance sheet sort of craze?

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Because we've seen just one company start to sell Bitcoin.

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But it seems like a lot of them came in, bought, smash bought initially.

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And then we don't hear anything else from them.

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It seems like the only one that's continually buying it is strategy.

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And all these other ones are now underwater because they bought when Bitcoin was between 100 and 120 at this point.

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So, you know, what do you make of this treasury movement?

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And is this something where, you know, you think almost this could be the next like FTX type of crash blow up where, you know, it doesn't Bitcoin still going to win at the end.

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But this could cause like some negative short term price action.

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No, I actually don't.

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don't. And the reason is, if you break down the public companies with Bitcoin on their balance

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sheet, outside of like the top 10, basically, they hold virtually no Bitcoin, not nearly enough to

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impact the price. In 2024, in the summer, people have already forgotten about this, but the German

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government sold about 80,000 Bitcoin. And right now, I'm going to pull up bitcoinquant.com so I

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can get the exact numbers. But the public holdings are very top heavy. You have MicroStrategy with

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about 600,000 BTC. Second is Mara with 53,000 Bitcoin. 21 now with 43,000. But it's a pretty

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steep drop off. Number 10 is CleanSpark with 13,000. And basically everyone below them has

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less than 10,000 Bitcoin. So even if all of them blew up, you're not going to get a seller with

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the same amount of coin as the German government who market dumped 80,000 Bitcoin last summer.

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And so I actually don't think they are really a threat in terms of being able to dump a lot

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of Bitcoin on the market. And I think we're still early in terms of public companies adopting

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Bitcoin. Every publicly traded company right now uses the internet. At some point, only a handful

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of public companies actually use the internet and had Wi-Fi, I think, or a website rather.

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And so I think we're still very, very early. What I'm looking at in terms of this trend is people love to point to the fact that most of these public companies, quote unquote, don't have a core business or their core business is not very profitable.

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And I'd like to highlight that this is a feature, not a bug.

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Right strategy, Michael Saylor has been incredibly vocal about this.

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When they embarked on their Bitcoin journey, it's because they had very low growth prospects.

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They were convinced they would be unable to compete with the Microsofts and Apples and Open AIs and Googles of the world.

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And so it makes perfect sense, in my opinion, that companies who need Bitcoin the most are going to be the ones that adopt it first.

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I think where things will really get interesting is when you do have these, quote unquote, otherwise successful companies start to just sweep some cash flows into Bitcoin. Will those equities be able to outperform Bitcoin over a long term? Probably not. Not unless they're positioning themselves as a leveraged Bitcoin equity. But I think that's an entirely separate business model, what strategy is doing. But I'm pretty excited. I think we're going to start to see that sometime in the next couple of years.

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We're going to see a good significant number of companies, either in the S&P 500 or the NASDAQ, that are just normal businesses, just sweeping some of their profits into Bitcoin.

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We saw this earlier this year with Figma.

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They're a software kind of like graphic design company that IPO'd.

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And they had quietly stacked a couple hundred million dollars worth of Bitcoin.

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I think as Bitcoin becomes more boring and the headlines start to be less of an impact on the market in the short term, as well as just sentiment online, that's a sign that Bitcoin's winning because ultimately you don't have internet conferences anymore.

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Right. You don't have people aren't getting all super excited about another company adopting the Internet.

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Right. And I think that's where Bitcoin's headed in the long run is it's just going to be normal for any company to store some amount of their balance sheet in Bitcoin.

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And as that becomes boring and the status quo, that's a sign that Bitcoin is won.

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Yeah. And I think that that's going to see we're going to see some developments of that over time.

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But you brought up an interesting point, the S&P 500.

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Right now, it looks like Block is the only one that would potentially start to or at least continue to stack Bitcoin in the S&P 500.

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And now we've had strategy up for that twice.

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And then there's now this MSCI potential ruling that these Bitcoin treasury companies cannot be in the S&P 500 or at least any of these indices.

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So I'm curious your thoughts on that because you brought up the profitable business model.

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You know obviously strategy has its you know SaaS company that it was built on but it was somewhat of a zombie company before Saylor really put in the Bitcoin on the balance sheet play in 2020

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And, you know, it's become what it is today.

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So how do you view this ruling?

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And do you think that this would negatively affect, I guess, this movement of companies putting Bitcoin on the balance sheet?

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I think the movement is wrong, but I also don't think this will hinder any company from adopting Bitcoin as a treasury reserve asset.

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Because the primary reason they would do that is not necessarily to be included in some of these indices, but it's to preserve their capital.

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Institutions, we tend to think of them in the abstract, but they're just a collection of individuals.

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And we all have the same incentive, which is you cannot hold dollars.

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Whether you're me, whether you're Michael Saylor, whether you're Larry Fink, if you hold dollars, they will lose value over time.

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And so corporations have this same dilemma.

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If you're generating a profit as a business, what do you do with that profit?

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Do you reinvest it into the business?

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Do you buy back shares?

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Do you buy gold?

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Do you buy real estate?

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Do you buy fine art?

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Do you buy treasuries?

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Do you buy Bitcoin?

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And I think more and more of them are going to come to the conclusion that some amount of Bitcoin is the correct answer.

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it won't all be a bunch of Michael Saylor copycats going all in and borrowing money to buy Bitcoin.

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But they're going to discover that zero is not the correct answer.

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And so I do think this ruling, the people it hurts most are the investors that passively allocate into these indices.

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Last bull run, we had exchanges blow up.

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You saw FTX, Celsius, BlockFi, you name it.

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but the true power of bitcoin is getting it off an exchange into cold storage this bull run i'm

330
00:30:39,599 --> 00:30:46,399
trusting trezor the company that's been around for over a decade and they just had a brand new

331
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332
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333
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334
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335
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336
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337
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339
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the easiest way possible. All right, enough from me. Let's get back to the show.

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Zero is not the correct answer. And so I do think this ruling, the people that hurts most are the

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investors that passively allocate into these indices. One thing I feel is almost like a

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noble mission would be to Trojan horse Bitcoin into people's portfolios, because unfortunately,

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most people are not willingly adopting Bitcoin and they're heading for a storm, right? The United

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States dollar is on a gradual decline. Now, some people are more hyperbolic than others and think

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it's a steep decline and we're going to have hyperinflation in the next couple of years.

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I myself used to believe that. Now I think it's going to be a continuation of this slow bleed.

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And that hurts the average person, right? The average person now can't buy a house until they're

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almost 40 years old. You've got Gen Z living in a four bedroom house with three roommates and

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they're barely able to make rent. You've got a plethora of older folks that are just not going

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to be able to retire basically ever because the social security benefits they're going to receive

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are just not going to be able to pay for all of the basic living needs,

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shelter, gas, food, etc.

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And so the one way I think we can actually solve this problem for a lot of people

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is if we get Bitcoin into these portfolios almost in an unknowing capacity.

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So if you get more squares and more strategies and more companies with Bitcoin exposure

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into the S&P 500, into the NASDAQ, people will be exposed to Bitcoin and they won't even know it.

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And this will allow them to continue to elevate their portfolio with inflation, right?

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As the currency gets debased, they're going to be okay.

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They're effectively going to be in the life raft if they have some sort of Bitcoin exposure.

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But I don't think that will happen willingly.

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And so I think we kind of need to get Bitcoin in there under people's noses effectively.

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Yeah.

363
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So, I mean, I think that is an interesting point.

364
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But would you argue that we already kind of do that with some of the companies that have Bitcoin on the balance sheet, like Tesla and some others?

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Or would you want, or I guess in your vision with this, would it be like more of a strategy or a company that is more all in on Bitcoin and not just, you know, kind of partially holding it?

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I think it would need to be more Teslas, actually.

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So they can adjust the weight that each company has in the indices.

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And so let's say strategy does make it into the S&P 500.

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Well, the weighting there is probably going to be under 1%.

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And then as Bitcoin goes up and strategy goes up,

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they're going to sell it and rebalance and make it 1% again, right?

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And so you're not getting the full experience of the gains.

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What I would rather see is a wider breadth.

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So, you know, two or three dozen different companies in the S&P 500

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that all have some amount of Bitcoin,

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even if it's not fully girth to like strategy.

377
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I got you.

378
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Yeah.

379
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I mean, and that would make more sense.

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So, I mean, I honestly think that at this point in time, we'll probably see strategy

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get in here next year at some point in 26, just because of how well it's doing and outperforming.

382
00:34:51,379 --> 00:34:56,799
But I do think that it is something we need to be keeping an eye on because, I mean, you

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know, JP Morgan's and the others, you know, they have a lot of dollars and they want to,

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you know, utilize BlackRock's IBIT ETF and create the leverage products on that.

385
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And essentially, it's just Wall Street pumping their own bags and they're trying to get Saylor to go kick rocks or something.

386
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So I think it's, you know, it's definitely something to keep a close eye on.

387
00:35:16,999 --> 00:35:29,519
But with this development of, you know, TradFi coming in and the ETFs, you know, we actually saw like a big sell off with these ETFs here when Bitcoin's price crashed.

388
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And we saw a big sell off from retail with wallets like that had a million sats or more.

389
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They decreased during this price crash from like $120,000 to about $80,000.

390
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Now, the narrative has been that retail has not been here during this bull run.

391
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Is that kind of some stuff that you're seeing as well, that retail hasn't quite shown up yet?

392
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And the retail that has, they're buying in at $120,000 and not having the, quote, diamond hands that we used to meme into existence back in 2017 and 2020?

393
00:36:05,179 --> 00:36:23,819
Yeah, I definitely agree that retail is not here. And I think it's for a variety of reasons. The main one being retail is broke. So in 2021, retail had just gotten a $2,000 stimulus check that they could load up into Robinhood or Coinbase or whatever and start buying different assets.

394
00:36:23,819 --> 00:36:37,759
And so as the problems of fiat currency continue to make the cost of living increase and people are increasingly living paycheck to paycheck, especially at the retail level, they're just going to be a non-factor when it comes to markets.

395
00:36:38,299 --> 00:36:41,799
And also Bitcoin is now an order of magnitude higher than it was in 2017.

396
00:36:42,219 --> 00:36:48,199
So even the retail that is around, they're not going to be able to move the needle on the market in any material way.

397
00:36:48,199 --> 00:37:13,519
Now, you do bring up a very interesting point, which is that the ETF holdings have declined during this recent drop off. However, it's only about 5% peak to trough compared to the Bitcoin price, which went down about 35%. And so when we talk about institutions, they're not necessarily, you know, people who buy the ETFs are not immune to effects of market psychology, right?

398
00:37:13,519 --> 00:37:22,419
We tend to see them capitulate during dips, and we also tend to see them increase their buying capacity during local tops.

399
00:37:23,019 --> 00:37:31,159
But generally, directionally, over the medium to long term, the ETFs are just this vehicle that is absorbing Bitcoin endlessly.

400
00:37:31,959 --> 00:37:41,019
And I wonder where the Bitcoin price would be right now if we didn't have the $57 billion in net inflows into the ETFs in 2025.

401
00:37:41,019 --> 00:37:45,959
I think the drop would have been a lot nastier than a 35% peak to trough.

402
00:37:46,439 --> 00:37:50,059
Yeah. And I mean, I think, you know, the, this cycle, I mean,

403
00:37:50,059 --> 00:37:53,139
I know we say it every single time, but this cycle is definitely different,

404
00:37:53,199 --> 00:37:55,679
especially with that a hundred K psychology. I mean,

405
00:37:55,679 --> 00:37:57,879
if you look at the amount that the whales are selling,

406
00:37:57,879 --> 00:38:02,379
any time that we would have had the whales selling the amount that they're,

407
00:38:02,379 --> 00:38:06,839
they sold, I think it's like a, in total, 9 million Bitcoin that, you know,

408
00:38:06,839 --> 00:38:13,339
firm wallets with a thousand or more that have been dormant for the greater part of five plus

409
00:38:13,339 --> 00:38:21,639
years. And I believe Checkmatey described that one. So if I'm incorrect, blame him. But anyway,

410
00:38:22,879 --> 00:38:29,299
seeing that kind of sell-off would have crashed the market more than we've ever seen before,

411
00:38:29,419 --> 00:38:34,459
because there just wasn't the buying pressure. And so I think actually floating around 120

412
00:38:34,459 --> 00:38:39,339
for the time that we did was actually kind of bullish and a good sign of the market.

413
00:38:39,339 --> 00:38:44,359
So it makes me believe that, you know, kind of like you described, like 26 is going to be bullish.

414
00:38:44,479 --> 00:38:49,459
Maybe we start off a little slow, but I definitely think that we're going to start to pick up,

415
00:38:49,539 --> 00:38:55,599
especially with, you know, this admin and the new institutions coming on.

416
00:38:56,099 --> 00:39:00,099
Now, you know, let's parlay that into the government here.

417
00:39:00,099 --> 00:39:04,819
Do you think that we're actually going to buy Bitcoin for this strategic reserve?

418
00:39:05,059 --> 00:39:12,619
Because it seems like they signed it into executive order and outside of seizing people's Bitcoin, it's been all quiet on the Western fronts.

419
00:39:13,719 --> 00:39:18,619
Yeah, if they do, it's probably going to be through something like 21.

420
00:39:18,619 --> 00:39:32,459
Right now, as far as I understand, the regulatory environment and the congressional situation is just not conducive for them to take capital and just go buy Bitcoin directly.

421
00:39:32,459 --> 00:39:53,099
I also don't think it would necessarily be the best optics because while people like you and I and the people listening to this podcast would say that's a great idea, the average American is going to point to the $39 trillion in debt, the $2 trillion annual deficit and question, quote unquote, why are we wasting money on Bitcoin?

422
00:39:53,099 --> 00:40:14,339
It wouldn't make sense to the average person. And 2026 is going to be a midterm year. And so I don't think they're going to exhaust their political resources trying to push some type of Bitcoin buying through the proper channels there. And so I actually don't expect that in the short term. Over the long term, I think it's absolutely going to be the case.

423
00:40:14,339 --> 00:40:33,979
But also, none of this diminishes the importance of the strategic Bitcoin reserve. Because as Bitcoiners, I would rather the government, when they confiscate Bitcoin, not sell it, than dump it all into the market and cause the price to go down, which is what could have previously happened without the strategic Bitcoin reserve.

424
00:40:33,979 --> 00:40:55,419
And moreover, I'm an American. I love America. I want America first policies. I want Americans on top always. And so I want our country to have a nice, big, fat Bitcoin stockpile. I don't want other countries to have those resources because I believe Bitcoin is the most important strategic asset in the 21st century and beyond.

425
00:40:55,419 --> 00:41:02,279
And so as an American, I want my country to have the most important strategic reserve asset in the 21st century.

426
00:41:02,759 --> 00:41:08,759
And one more point, which is you mentioned that you said the daring phrase that this time is different.

427
00:41:09,159 --> 00:41:10,919
And people are going to mock you for that in the comments.

428
00:41:11,319 --> 00:41:16,179
One of my absolute favorite things about Bitcoin is meeting all of you in person.

429
00:41:16,359 --> 00:41:23,479
So mark your calendars for February 28th and come down to where I've called home for the past eight years, Tampa, Florida.

430
00:41:24,159 --> 00:41:27,479
The Bitcoin Bay Foundation is putting on this sound money soiree.

431
00:41:27,599 --> 00:41:28,819
It's the third annual.

432
00:41:29,219 --> 00:41:33,499
It's a night of Bitcoin, poker, an open bar, and a silent auction.

433
00:41:34,119 --> 00:41:35,699
All support will go to Bitcoin Bay,

434
00:41:35,819 --> 00:41:39,959
a nonprofit that is creating a circular economy down in Tampa Bay, Florida.

435
00:41:40,079 --> 00:41:42,879
They're doing absolutely great things,

436
00:41:43,039 --> 00:41:46,939
and it's the Bitcoin community that I've called home for such a long time,

437
00:41:47,099 --> 00:41:49,339
and these guys are absolutely crushing it.

438
00:41:49,419 --> 00:41:51,599
So please do anything you can to support.

439
00:41:51,899 --> 00:41:52,859
Buy your tickets today.

440
00:41:52,859 --> 00:41:57,819
you can use promo code GREENCANDLE to get 10% off your Sound Money Soiree tickets.

441
00:41:57,819 --> 00:41:59,739
So do you know anything about Bitcoin?

442
00:41:59,739 --> 00:42:00,459
No.

443
00:42:00,459 --> 00:42:04,859
You guys can come down and see this ugly mug, come boogie on the dance floor, shake it,

444
00:42:04,859 --> 00:42:08,459
and now that Bitcoin's over 100K, you can do it all with your girlfriends.

445
00:42:09,099 --> 00:42:11,099
Alright, on that for me, let's get back to the show.

446
00:42:14,539 --> 00:42:19,579
...predserve asset in the 21st century. And one more point, which is,

447
00:42:19,579 --> 00:42:23,499
You mentioned that you said the daring phrase that this time is different.

448
00:42:23,979 --> 00:42:25,659
And people are going to mock you for that in the comments.

449
00:42:26,159 --> 00:42:27,979
But you're objectively correct.

450
00:42:28,219 --> 00:42:29,739
This time is factually different.

451
00:42:30,219 --> 00:42:32,759
I'm looking at the live Bitcoin price right now.

452
00:42:32,839 --> 00:42:35,259
It's about $91,000 per Bitcoin.

453
00:42:35,819 --> 00:42:39,199
That is almost to a T where we started the year.

454
00:42:39,699 --> 00:42:42,939
Bitcoin has never in its entire history had a year this flat.

455
00:42:43,279 --> 00:42:44,459
This is objectively different.

456
00:42:44,459 --> 00:42:47,619
Bitcoin is going to have a yellow candle for the first time in history.

457
00:42:47,619 --> 00:42:50,039
This is a big deal. And this time is certainly different.

458
00:42:50,939 --> 00:43:22,079
Yeah 100 And you know I get it But I get people get annoyed with all of us saying that But I mean it just every cycle has its own unique little wrinkles in it And you know whether it like various macro factors or adoption I mean everything is never you know the same But I think this one is in fact you know a little bit more unique than what we seen before But outside of the government I mean potentially buying Bitcoin or utilizing one of these public partnerships

459
00:43:22,879 --> 00:43:31,279
something that I think is, I guess, a telling here going forward is the overall macro environment.

460
00:43:31,719 --> 00:43:36,199
I mean, we've got Jerome Powell is potentially going to cut interest rates in a few days here

461
00:43:36,199 --> 00:43:43,479
again. And we've had inflation higher than it's ever been for an interest rate cut environment

462
00:43:43,479 --> 00:43:49,719
and ending of QT. So what do you think of just the overall macro environment? It seems like Larry

463
00:43:49,719 --> 00:43:55,159
Lepard's big print is going to play out here within the next year or maybe even faster than

464
00:43:55,159 --> 00:44:02,199
he anticipated after writing that book. So I'm curious how you view it and what you think 26 is

465
00:44:02,199 --> 00:44:09,679
going to look like just from a macro perspective? Yeah, great question. So the first point I would

466
00:44:09,679 --> 00:44:15,479
make is don't overthink this. The Federal Reserve lowering interest rates, whether it happens in

467
00:44:15,479 --> 00:44:21,779
December or whether it happens in 2026, is bullish. And that's going to cause risk assets

468
00:44:21,779 --> 00:44:26,179
to increase over the medium to long term. So I wouldn't try to get cued on this. I wouldn't try

469
00:44:26,179 --> 00:44:31,299
to outthink it. They're going to cut rates and it's going to be good for markets. Now on the big

470
00:44:31,299 --> 00:44:39,939
print. I think I like Larry Lepard a lot and I read his book and I find it pretty valuable.

471
00:44:40,459 --> 00:44:46,859
Although I tend to be weary of the hyperbolic language here because the last thing I want,

472
00:44:46,899 --> 00:44:52,059
and I know he doesn't want this either, is hyperinflation. And I absolutely do not want

473
00:44:52,059 --> 00:44:57,959
that even though it would probably send Bitcoin to $10 million because it's going to fracture the

474
00:44:57,959 --> 00:45:02,799
actual real economy in terms of the ability to produce goods and services, it would cause

475
00:45:02,799 --> 00:45:09,619
unprecedented societal chaos. I do not want that to happen. And I also don't really think it's

476
00:45:09,619 --> 00:45:15,299
likely. I mentioned earlier in the show, I think we're going to see a continual slow bleed of

477
00:45:15,299 --> 00:45:20,579
purchasing power within the US dollar, right? Mathematically, it's inevitable. They are not

478
00:45:20,579 --> 00:45:25,319
going to be able to pay down the debt nominally. They're going to have to debase the currency to

479
00:45:25,319 --> 00:45:30,919
do so. They spend too much on Social Security, Medicare, military spending, interest payments on

480
00:45:30,919 --> 00:45:36,599
the debt. They're not going to be able to run a budget surplus and pay the debt in the real way,

481
00:45:36,639 --> 00:45:42,779
so to speak. They're going to devalue the currency. That much is obvious. And we're also seeing the

482
00:45:42,779 --> 00:45:47,479
Federal Reserve capitulate on interest rate cuts far before they ever reach their quote-unquote

483
00:45:47,479 --> 00:45:53,639
2% inflation target. So I think he's right in that all signs and all roads lead to currency

484
00:45:53,639 --> 00:46:00,439
to basement. I'm just very optimistic that that won't happen in a catastrophic overnight fashion.

485
00:46:01,159 --> 00:46:06,959
I'm also pretty optimistic that AI is going to radically increase our productivity,

486
00:46:07,299 --> 00:46:12,699
which will allow the economy to grow at the very least with the debt.

487
00:46:13,919 --> 00:46:19,539
Where will these economic gains go to? Where will they accrue to? It won't be people holding cash.

488
00:46:19,539 --> 00:46:26,179
It will be people holding hard assets like Bitcoin or equity in the top performing businesses during this time.

489
00:46:26,359 --> 00:46:28,659
So I do think a big print is coming.

490
00:46:29,219 --> 00:46:40,299
But however, I'm pretty confident and optimistic that it'll be a gradual big print rather than kind of one giant tsunami of money printing like we saw in 2020.

491
00:46:40,479 --> 00:46:41,819
I think that was an anomaly.

492
00:46:41,819 --> 00:46:53,659
Yeah, and I mean, to me too, I think the way that this affects Bitcoin is very unique because I'm of the theory that we haven't really had a full bull run since 2017.

493
00:46:54,179 --> 00:47:06,819
Because now before you guys come at me in the comments or anything, but if you look at 2020, right, we had the entire world economy shut down for months at a time, which is a huge just anomaly.

494
00:47:06,819 --> 00:47:12,659
anomaly. So everybody, you know, kind of, I guess, you know, remembers but doesn't think of like the

495
00:47:12,659 --> 00:47:18,819
full impact that had on the overall economy. And then we had just an insane amount of liquidity,

496
00:47:18,819 --> 00:47:22,899
and you know, the stimmy checks and everything getting dumped into Bitcoin. But also during that

497
00:47:22,899 --> 00:47:28,819
time, we had China banning Bitcoin mining, and then we had FTX and all the exchanges, essentially,

498
00:47:28,819 --> 00:47:32,979
you know, trying to manipulate and maybe issue paper Bitcoin, because I don't think that they

499
00:47:32,979 --> 00:47:37,679
they were actually, you know, buying Bitcoin for all of their clients all over the world. So,

500
00:47:38,019 --> 00:47:41,899
you know, there was some hairiness with that. So I think that there was actually some potential

501
00:47:41,899 --> 00:47:47,699
price suppression that we had last time around. And then now we have TradFi kind of in all of

502
00:47:47,699 --> 00:47:53,739
this playing their TradFi games. So what do you think that this means for Bitcoin here? Are we

503
00:47:53,739 --> 00:47:59,199
going to see like a 2020 type of run with, you know, this extended liquidity? Or do you think

504
00:47:59,199 --> 00:48:04,139
we'll actually just get like kind of that the end of the four year cycle, even though I mean,

505
00:48:04,179 --> 00:48:08,899
I don't know if I necessarily subscribe to that theory and more of like an extended runway here.

506
00:48:09,779 --> 00:48:15,479
I think we're going to continue to see what we've seen since 2024 when the ETFs were created,

507
00:48:15,679 --> 00:48:21,599
which is very long, drawn out periods of consolidation that shake all of the tourists

508
00:48:21,599 --> 00:48:27,019
and high time preference traders out of their position. And every now and then every couple

509
00:48:27,019 --> 00:48:33,259
of months, you're going to see Bitcoin move higher. In March of 2024, we went from about

510
00:48:33,259 --> 00:48:40,439
$40K to $60K. In November of 2024, we went from $60K to $100K. In the summer of this year,

511
00:48:40,479 --> 00:48:45,679
we went from the lows of $75K all the way up to $120K. I think we're going to see Bitcoin

512
00:48:45,679 --> 00:48:49,479
stair-step higher continuously over the next decade.

513
00:48:50,579 --> 00:48:54,699
Okay. So then we're going to go slow to $1 million is what you think, huh?

514
00:48:54,699 --> 00:48:59,139
Yeah, I think we break it in the tortoise fashion rather than the hare.

515
00:48:59,659 --> 00:49:00,279
I gotcha.

516
00:49:00,639 --> 00:49:05,999
All right, so now that brings me into everybody's favorite topic here, Bitcoin mining, right?

517
00:49:06,299 --> 00:49:10,899
I mean, obviously, you've got a close proximity to what is going on with this.

518
00:49:11,379 --> 00:49:15,779
And I think the unique aspect that a lot of people were talking about maybe a year ago,

519
00:49:15,819 --> 00:49:20,299
but haven't really brought it up too much here lately was during this last bear market,

520
00:49:20,419 --> 00:49:22,639
we saw the hash rate actually increase.

521
00:49:22,639 --> 00:49:27,479
And this was the first time we'd ever see this in a quote unquote bear market.

522
00:49:28,339 --> 00:49:31,959
What are you kind of seeing right now in the mining space?

523
00:49:32,499 --> 00:49:38,859
And do you think that there's some potentially nation states really starting to get into the Bitcoin mining space now?

524
00:49:39,259 --> 00:49:45,619
Because it seems like there's a lot of energy dense countries really coming to the forefront.

525
00:49:45,899 --> 00:49:47,719
There's sovereign wealth funds and everything else.

526
00:49:47,719 --> 00:49:54,279
But there hasn't been an announcement of a big giant buy that's really blown our faces off just yet.

527
00:49:54,459 --> 00:49:56,279
So maybe just maybe they're mining.

528
00:49:56,699 --> 00:49:58,499
So what have you been seeing?

529
00:49:58,639 --> 00:50:01,139
And do you think that that's a possibility there?

530
00:50:01,919 --> 00:50:02,499
Great question.

531
00:50:02,759 --> 00:50:04,459
And it's not a possibility.

532
00:50:04,459 --> 00:50:05,399
It's a certainty.

533
00:50:05,599 --> 00:50:09,759
We know for a fact that there are many nation states actively mining Bitcoin.

534
00:50:09,759 --> 00:50:22,879
But I will say to me, the most interesting development that I've seen within mining in 2025 is the overwhelming amount of demand from non-Bitcoin people.

535
00:50:23,499 --> 00:50:32,559
So Trump entirely changed the game in July of this year when he passed the one big beautiful bill and brought back 100% bonus depreciation.

536
00:50:33,139 --> 00:50:37,479
So I'm going to kind of zoom out here and it'll come back to Bitcoin mining, trust me.

537
00:50:37,479 --> 00:50:43,259
but I want to kind of set the stage here. We know that the government can print money, right?

538
00:50:43,459 --> 00:50:48,739
They can print money. So why do they need to levy taxes when they have a money printer at the

539
00:50:48,739 --> 00:50:55,079
Federal Reserve? It's to change the incentives of economic actors. They want to influence

540
00:50:55,079 --> 00:51:01,719
certain behaviors by offering tax deductions or disincentivize other behaviors by increasing the

541
00:51:01,719 --> 00:51:06,119
tax rate on those certain activities. And so when we view the world through this framework and

542
00:51:06,119 --> 00:51:10,959
taxation through this framework, what kind of activities are they incentivizing and what are

543
00:51:10,959 --> 00:51:16,539
they disincentivizing? Well, they tend to incentivize business creation and risk takers

544
00:51:16,539 --> 00:51:22,399
and entrepreneurship. If you start a business, you get a plethora of tax savings that are not

545
00:51:22,399 --> 00:51:29,579
available to the average W-2 employee. And the ethos behind Trump's one big, beautiful bill

546
00:51:29,579 --> 00:51:33,719
is they want to grow out of the debt. They tried throwing the kitchen sink at the problem,

547
00:51:34,319 --> 00:51:36,839
Doge to cut superfluous spending didn't work.

548
00:51:37,279 --> 00:51:41,479
Tariffs to generate revenue immediately to try to pay down the debt didn't generate nearly

549
00:51:41,479 --> 00:51:41,839
enough.

550
00:51:41,839 --> 00:51:49,779
And so this is the next progressive stage within that, which is let's give capital back to

551
00:51:49,779 --> 00:51:50,859
the free market.

552
00:51:50,959 --> 00:51:55,579
Rather than bringing it in now in the form of taxation, let's offer people incentives

553
00:51:55,579 --> 00:51:56,899
to start their own business.

554
00:51:57,239 --> 00:52:02,339
And hopefully, business owners will allocate that capital more efficiently than the government.

555
00:52:02,339 --> 00:52:07,219
the economy will grow and we'll have a larger tax base years down the line and basically be able to

556
00:52:07,219 --> 00:52:13,459
pay back the debt then. So the entire idea behind this big, beautiful bill is to offer incentives

557
00:52:13,459 --> 00:52:19,979
to business owners. One of those is 100% bonus depreciation. So certain assets qualify for this.

558
00:52:20,479 --> 00:52:26,419
You could purchase basically any asset with a depreciable lifespan under 20 years. So we're

559
00:52:26,419 --> 00:52:32,739
talking power washers and tractors and Bitcoin mining servers. There's a bunch of different

560
00:52:32,739 --> 00:52:38,999
capital assets, capital goods, goods that you do not consume for themselves, but you use them to

561
00:52:38,999 --> 00:52:44,999
produce other goods, goods you would use to run a business. And you can get a 100% tax deduction

562
00:52:44,999 --> 00:52:51,199
on these goods. And this also has interesting origins in real estate, right? Because think

563
00:52:51,199 --> 00:52:56,639
about private investor, business mogul Trump, not President Trump, switch hats here. This was his

564
00:52:56,639 --> 00:53:01,379
play, right? He had billions of dollars of Manhattan real estate. He would depreciate them.

565
00:53:01,619 --> 00:53:06,739
Now he couldn't do 100% bonus depreciation, but he could depreciate them enough to offset his

566
00:53:06,739 --> 00:53:12,859
income. There were all these famous headlines from CNN and liberal media outlets trying to position

567
00:53:12,859 --> 00:53:17,679
it as if Trump didn't pay taxes. He did not break any laws. He didn't do anything malicious.

568
00:53:17,679 --> 00:53:23,539
he used the tax system according to the rules that were already written, right? He took advantage

569
00:53:23,539 --> 00:53:28,859
of the rules, bought assets that he could depreciate, offset his income, and legally pay no taxes.

570
00:53:29,699 --> 00:53:34,579
Why would you ever hold generational wealth on a piece of paper? It doesn't make sense.

571
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572
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573
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They've engineered the perfect and most easy to use solution.

574
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575
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576
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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,

577
00:54:04,479 --> 00:54:06,899
but it could survive all of that and more.

578
00:54:07,559 --> 00:54:10,119
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579
00:54:10,179 --> 00:54:11,999
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580
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581
00:54:17,239 --> 00:54:22,099
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582
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All right, enough from me.

583
00:54:23,979 --> 00:54:24,799
Back to the show.

584
00:54:25,319 --> 00:54:28,459
System, according to the rules that were already written, right?

585
00:54:28,499 --> 00:54:32,759
He took advantage of the rules, bought assets that he could depreciate, offset his income,

586
00:54:32,899 --> 00:54:34,519
and legally pay no taxes.

587
00:54:35,459 --> 00:54:41,519
There's a quote from an early 20th century judge called, his name is Billings Hand, I

588
00:54:41,519 --> 00:54:46,039
believe. And he said there's two systems of taxation, one for the educated and one for the

589
00:54:46,039 --> 00:54:52,859
uneducated. So long story short, Bitcoin mining servers now qualify for 100% bonus depreciation.

590
00:54:52,859 --> 00:54:59,579
So what we've seen at Blockware is tons of business owners now positioning their excess

591
00:54:59,579 --> 00:55:04,539
capital rather than it going to Uncle Sam, they're buying Bitcoin mining servers and they're mining

592
00:55:04,539 --> 00:55:10,339
Bitcoin with Blockware. And so one, it's opening the door to people that otherwise would not have

593
00:55:10,339 --> 00:55:14,859
necessarily been interested in Bitcoin. They would have considered other assets for a tax write-off.

594
00:55:14,979 --> 00:55:21,439
They would have maybe gone in on an oil rig or bought some real estate property and gone with

595
00:55:21,439 --> 00:55:26,279
the straight line depreciation over 29 years or something like that. And instead, they're like,

596
00:55:26,359 --> 00:55:30,559
man, I can get a better write-off with this Bitcoin miner. It's generating a lot of cash

597
00:55:30,559 --> 00:55:35,939
flow every year, 25% to 50% returns depending on the Bitcoin price. And you're building a Bitcoin

598
00:55:35,939 --> 00:55:41,339
treasury, which is going to passively accrue value for you over time. And so this to me has

599
00:55:41,339 --> 00:55:45,539
been by far and away the most interesting development in the Bitcoin mining world.

600
00:55:46,139 --> 00:55:53,219
And I think if we put back on the Trump hat, I think this could actually work in terms of

601
00:55:53,219 --> 00:55:58,959
accelerating economic growth. Because if you extrapolate these incentives across all industries,

602
00:55:59,059 --> 00:56:02,599
not just Bitcoin mining, the free market is going to have more capital to work with.

603
00:56:02,599 --> 00:56:05,839
They're going to allocate it better than the government. And I think this is going to be

604
00:56:05,839 --> 00:56:11,339
a net positive for the economy, a net positive for society. Yeah, I think, you know, giving the

605
00:56:11,339 --> 00:56:17,539
people the tax benefits, I think, has always been a good incentive there. And that's interesting. I

606
00:56:17,539 --> 00:56:22,479
mean, I think I've heard Mark Moss was maybe the one that kind of like opened my eyes to potential

607
00:56:22,479 --> 00:56:28,139
of depreciation. But I after outside of him, I haven't really heard too many people talking about

608
00:56:28,139 --> 00:56:34,639
the potential to use Bitcoin miners as depreciation. But that's interesting. And I think

609
00:56:34,639 --> 00:56:39,319
it's going to be a huge development. Now, do you think that a lot of people have, I guess,

610
00:56:39,699 --> 00:56:45,599
moved from assets like real estate and other hard assets towards something like a Bitcoin miner

611
00:56:45,599 --> 00:56:50,359
just yet? Or is it still just, I guess, in the early stages here?

612
00:56:50,919 --> 00:56:55,819
It's still in the early stages. And we're seeing the people do it now certainly are going to get a

613
00:56:55,819 --> 00:57:01,419
first mover advantage. And I'm glad you mentioned Mark Moss, because he does a fantastic job at

614
00:57:01,419 --> 00:57:07,799
articulating this concept. And he's opened my eyes as well. And I really view this through,

615
00:57:08,119 --> 00:57:13,479
there's three levels to wealth creation. Most people listening to this are probably on level

616
00:57:13,479 --> 00:57:19,979
two. So level one is you don't have any knowledge of how the financial system works. You go to your

617
00:57:19,979 --> 00:57:25,959
job, you earn an income and you save in dollars. Level two is you know that the currency is going

618
00:57:25,959 --> 00:57:31,899
to lose value. So you go to a job or you start a business and the income you produce, you save it

619
00:57:31,899 --> 00:57:38,279
in assets, either Bitcoin, equities, real estate, whatever. Level three, and this is where I've

620
00:57:38,279 --> 00:57:39,859
tried to position myself this year.

621
00:57:39,918 --> 00:57:44,598
I think this is one of the things I've certainly learned the most about in 2025 is level three.

622
00:57:44,718 --> 00:57:48,438
And this is the difference between sort of the middle class or upper middle class and the ultra

623
00:57:48,438 --> 00:57:54,558
wealthy is they have a tax saving strategy. They're able to create somewhat of an economic

624
00:57:54,558 --> 00:57:59,858
flywheel by the capital that would go to the government instead goes into income producing

625
00:57:59,858 --> 00:58:05,038
assets that they're able to depreciate and then take that income and buy more hard assets. And so

626
00:58:05,038 --> 00:58:10,878
Mark Moss does a great job at articulating this. And we're going to see it play out gradually where

627
00:58:10,878 --> 00:58:15,898
investors and business owners, they take the capital they otherwise would have bought

628
00:58:15,898 --> 00:58:22,718
a real estate property or a tractor or an oil rig or a washing laundry mat or whatever,

629
00:58:23,018 --> 00:58:26,898
any kind of depreciable asset. And they're going to look at that and they're going to run the

630
00:58:26,898 --> 00:58:32,678
calculus and they're going to see that I can buy an asset, a Bitcoin miner, that I can depreciate

631
00:58:32,678 --> 00:58:38,738
100% in a single year. So the best tax savings play there is hands down. And additionally,

632
00:58:38,738 --> 00:58:43,678
it's actually going to produce far more cash flow. I don't want to be a landlord. I don't want to

633
00:58:43,678 --> 00:58:48,518
have to go change a tenant's toilet at three in the morning or whatever these landlords have to

634
00:58:48,518 --> 00:58:53,078
deal with. And instead, this Bitcoin miner is just going to accumulate Bitcoin for me every single

635
00:58:53,078 --> 00:58:58,738
day. And Bitcoin is the best performing asset of the past 15 years. So we're going to see more of

636
00:58:58,738 --> 00:59:02,898
gradual shift. That's what we're seeing at Blockware. We have new clients this year that

637
00:59:02,898 --> 00:59:07,318
they never mined Bitcoin before. They never even really considered it until they saw this tax

638
00:59:07,318 --> 00:59:11,698
write-off. And now they're as orange-pilled as you and I. Because once they get their hands on it and

639
00:59:11,698 --> 00:59:16,398
they start stacking some sats, even if they started with the idea of, I'm just going to sell all this

640
00:59:16,398 --> 00:59:23,258
Bitcoin and just convert it to cash, the actual having that touch point with Bitcoin sends people

641
00:59:23,258 --> 00:59:27,258
down the rabbit hole. They learn about it. They start wanting to accumulate very aggressively.

642
00:59:27,258 --> 00:59:32,218
So I think this is an under-discussed development within the Bitcoin world.

643
00:59:32,318 --> 00:59:41,238
And I think it's going to secretly orange pill not just people, but the most value additive people in the economy, which is business owners.

644
00:59:41,238 --> 00:59:45,498
Because they're the ones who are looking the most and looking the hardest for a tax write-off.

645
00:59:46,318 --> 00:59:47,078
Yeah, it's interesting.

646
00:59:47,338 --> 00:59:48,518
So do you think like that?

647
00:59:48,638 --> 00:59:52,738
I mean, obviously, you guys do great work at Blockware and help with hosting.

648
00:59:52,738 --> 01:00:01,238
But do you see people trying to integrate that into whatever their business is, like whether it's, you know, if they have real estate?

649
01:00:01,438 --> 01:00:04,698
I mean, I know Grant Cardone has been very vocal about all of this.

650
01:00:04,998 --> 01:00:11,678
Do you foresee potentially, you know, real estate investors trying to integrate Bitcoin miners into their into the homes?

651
01:00:11,718 --> 01:00:14,598
Or is that just a far fetched idea right now?

652
01:00:14,598 --> 01:00:33,173
It not far fetched and it does happen but it not going to be at anywhere near a big enough scale to actually manifest in terms of like an increase in hash rate on the network or mining difficulty Because even if you were heating your house with a couple of Bitcoin miners

653
01:00:33,833 --> 01:00:39,373
we're talking, you know, comparing three ASICs to heat a home versus a data center with a thousand

654
01:00:39,373 --> 01:00:44,393
ASICs. It's just kind of, you know, the New York Yankees and a T-ball team when you really think

655
01:00:44,393 --> 01:00:50,493
about the impact on the network. Now, that's not to disincentivize or discourage people from doing

656
01:00:50,493 --> 01:00:57,273
that. I think if you can find any way to build and incorporate hash into your house, do it.

657
01:00:57,473 --> 01:01:03,213
Absolutely. Go for it. I think it's very important for keeping the Bitcoin network decentralized and

658
01:01:03,213 --> 01:01:08,513
secure, as well as I think it's just a fun hobby. And why would you not want to stack sats as a

659
01:01:08,513 --> 01:01:16,153
hobby? Yeah, exactly right. I mean, that's definitely a good hobby to have. But I want

660
01:01:16,153 --> 01:01:22,833
to put your conspiratorial hat on here for a second. Because, you know, with this discussion

661
01:01:22,833 --> 01:01:27,233
on Bitcoin mining, and obviously, the Trumps are very heavy into real estate. I mean, they just

662
01:01:27,233 --> 01:01:33,593
launched ABC, right, American Bitcoin company. And we've seen Eric Trump talk a lot about Bitcoin

663
01:01:33,593 --> 01:01:39,233
mining. He's posted a video on X here recently, of, you know, showing the entire facility that

664
01:01:39,233 --> 01:01:45,193
they've got here in Texas. Do you think that, you know, this law about Bitcoin mining was

665
01:01:45,193 --> 01:01:52,733
coincidental or do you think that Eric and some of his brothers were in his father's ear about the

666
01:01:52,733 --> 01:01:58,613
potential benefits of Bitcoin mining and kind of trying to sway it over from the real estate side

667
01:01:58,613 --> 01:02:04,093
into the Bitcoin side of things? I mean, love it or hate it, that's how politics works, right?

668
01:02:04,093 --> 01:02:11,073
And it's kind of ironic because when Trump was running in 2015, he was like, I have my own money,

669
01:02:11,073 --> 01:02:15,833
like nobody's going to tell me what to do. That's not really how things actually shaked out in

670
01:02:15,833 --> 01:02:22,653
practice. He certainly capitulates to the demands of his donors. As a Bitcoiner, I want Bitcoiners

671
01:02:22,653 --> 01:02:27,973
to be the people in the politicians' ears. I want us to have the largest and most powerful and

672
01:02:27,973 --> 01:02:33,153
influential political lobbies advocating for my interests as a Bitcoiner. That point aside,

673
01:02:33,313 --> 01:02:39,313
I'm certain, yeah, there was definitely somebody in his ear. But I'm glad you brought up ABTC

674
01:02:39,313 --> 01:02:44,833
because I think the relationship between American Bitcoin and Hut8

675
01:02:44,833 --> 01:02:49,233
does a great job at really dissecting the Bitcoin mining industry

676
01:02:49,233 --> 01:02:54,473
because I view the Bitcoin mining world as having multiple distinct layers.

677
01:02:55,213 --> 01:02:58,513
And people have gotten very confused in the past

678
01:02:58,513 --> 01:03:00,913
because Bitcoin will go on these rallies

679
01:03:00,913 --> 01:03:08,013
and mining stocks will just not come anywhere close to competing with that.

680
01:03:08,013 --> 01:03:20,309
and they kind of struggle and underperform while Bitcoin doing well Sometimes it the university of mining stocks doing well and Bitcoin not But the fundamental reason is because most quote unquote

681
01:03:20,309 --> 01:03:26,829
Bitcoin mining stocks, they're not really that long Bitcoin. Because to mine Bitcoin at scale,

682
01:03:26,929 --> 01:03:31,689
you have to have land, you have to have certain energy infrastructure, you have to have

683
01:03:31,689 --> 01:03:37,409
transformers and containers. And at these large scales, you're having a bunch of additional

684
01:03:37,409 --> 01:03:43,149
operating costs, employees to manage all of that. The executives get certain high compensation

685
01:03:43,149 --> 01:03:47,549
packages. They're taking out loans and they're having to pay interest on all that.

686
01:03:48,489 --> 01:03:54,089
And so the actual breakdown of the balance sheet is not really incredibly long Bitcoin,

687
01:03:54,669 --> 01:03:59,849
but this is where I am a big fan of American Bitcoin. And what they did is Hut8 said,

688
01:04:00,049 --> 01:04:04,769
all right, we have these data centers and we have these Bitcoin miners in the data centers.

689
01:04:04,769 --> 01:04:18,109
What if we break off the business so that HUT8 is just the data centers and all of the energy infrastructure, which you can monetize that by mining Bitcoin, you can monetize it by running AI or high performance computing servers.

690
01:04:18,549 --> 01:04:22,449
And then we take all the Bitcoin miners and we take all the Bitcoin, we put it into a different entity.

691
01:04:23,349 --> 01:04:34,749
And now if you're an investor, you can choose between the lower volatility Hut 8, which is more of a cash cow, less volatile, less Bitcoin exposed type entity.

692
01:04:35,149 --> 01:04:37,609
Or you can say, hey, I want to get long Bitcoin.

693
01:04:37,769 --> 01:04:38,869
I want to buy the Bitcoin miners.

694
01:04:38,949 --> 01:04:39,649
I want to buy the Bitcoin.

695
01:04:40,029 --> 01:04:41,109
Let me buy American Bitcoin.

696
01:04:41,669 --> 01:04:45,509
And so at Blockware, what we offer to our clients is to be like American Bitcoin.

697
01:04:45,969 --> 01:04:48,729
You don't have all of the additional overhead of running your facility.

698
01:04:48,909 --> 01:04:50,649
You just own the ASIC.

699
01:04:50,649 --> 01:04:53,209
That's your only upfront cost, 100% tax deduction.

700
01:04:53,529 --> 01:04:55,729
And your only operating expense is the electricity.

701
01:04:56,329 --> 01:04:58,269
And then you keep all the Bitcoin that you mine.

702
01:04:58,389 --> 01:05:01,889
So it positions you as that slice of the pie, right?

703
01:05:01,889 --> 01:05:05,749
If it's a layered pie, you've got the land and energy at the bottom.

704
01:05:05,869 --> 01:05:08,189
You have the infrastructure and operations at top.

705
01:05:08,989 --> 01:05:13,129
And then above that, you have the Bitcoin miners and the Bitcoin that actually gets accumulated.

706
01:05:13,369 --> 01:05:18,549
And so if you don't want to own the whole stack, which two-thirds of that stack is not really long Bitcoin,

707
01:05:18,549 --> 01:05:21,949
and you just want to be at the top, you can be an American Bitcoin

708
01:05:21,949 --> 01:05:25,529
or you can mine Bitcoin with someone like Blockware.

709
01:05:26,329 --> 01:05:27,329
Yeah, that's great.

710
01:05:27,429 --> 01:05:29,989
Well, you guys do great works over at Blockware.

711
01:05:30,229 --> 01:05:33,989
So tell us a little bit about what you guys got here planned for the year ahead,

712
01:05:34,009 --> 01:05:38,269
if you can, and some of the things that you're looking forward to for 2026.

713
01:05:39,189 --> 01:05:42,809
Yeah, so this is, it's your lucky day, Brandon.

714
01:05:42,889 --> 01:05:44,609
I'm actually going to break news on this show.

715
01:05:44,609 --> 01:05:50,409
I didn't plan on doing this and I guess I'm just going to tease at it.

716
01:05:50,409 --> 01:06:10,644
So we launching a new product in 2026 Q1 and I try to say as much as I can So this is going to in my opinion replace the way a lot of people dollar cost average into Bitcoin So we talk a lot at Blockware about Bitcoin mining as producing

717
01:06:10,644 --> 01:06:18,544
Bitcoin at a discount. So if you're going on Coinbase or River or Swan or Strike, you're

718
01:06:18,544 --> 01:06:23,384
buying Bitcoin at the market price. Your exchange rate is dollars for Bitcoin. If you're mining

719
01:06:23,384 --> 01:06:29,424
Bitcoin, your exchange rate is compute and energy for Bitcoin. And so there's this arbitrage because

720
01:06:29,424 --> 01:06:34,924
you're able to produce Bitcoin at a price effectively discounted from the dollarized

721
01:06:34,924 --> 01:06:40,764
Bitcoin exchange rate. So for example, the most efficient miners at our facilities are

722
01:06:40,764 --> 01:06:46,704
basically buying Bitcoin every single day at $60,000 per coin. So about a 50% market discount.

723
01:06:47,164 --> 01:06:51,484
The product we're offering, which isn't live yet, but it'll be live very soon.

724
01:06:51,484 --> 01:06:56,284
you're going to be able to basically get that discounted Bitcoin price

725
01:06:56,284 --> 01:06:59,564
without actually buying the mining server yourself.

726
01:06:59,724 --> 01:07:01,164
So if you don't need a tax write-off,

727
01:07:01,324 --> 01:07:04,884
if you can't afford to spend $5,000 on a Bitcoin miner,

728
01:07:05,504 --> 01:07:08,584
you're going to be able to unlock that discounted price

729
01:07:08,584 --> 01:07:09,604
without actually buying it.

730
01:07:09,864 --> 01:07:12,284
And I'll leave it at that, but keep an eye out

731
01:07:12,284 --> 01:07:14,344
because we're going to be launching this product very, very soon.

732
01:07:14,884 --> 01:07:15,364
That's awesome.

733
01:07:15,524 --> 01:07:19,284
We'll link all your socials and everything like that in the show notes

734
01:07:19,284 --> 01:07:21,744
so people can check it out when it's actually live.

735
01:07:21,944 --> 01:07:23,444
But hey, breaking news, man.

736
01:07:23,484 --> 01:07:25,544
I appreciate you coming on this show

737
01:07:25,544 --> 01:07:26,944
and thanks so much for your time.

738
01:07:27,004 --> 01:07:28,004
So why don't you tell people

739
01:07:28,004 --> 01:07:30,184
where they can find out your socials

740
01:07:30,184 --> 01:07:32,024
and the great work that you guys do

741
01:07:32,024 --> 01:07:33,064
over at Blockware as well.

742
01:07:33,644 --> 01:07:34,824
Thank you for having me, Brandon.

743
01:07:34,904 --> 01:07:36,284
It's always a joy to come on here

744
01:07:36,284 --> 01:07:37,264
and chop it up with you.

745
01:07:37,604 --> 01:07:38,384
If you want to follow me,

746
01:07:38,424 --> 01:07:40,164
you can find me at Mitchell Hoddle.

747
01:07:40,544 --> 01:07:42,404
I'm still battling with X

748
01:07:42,404 --> 01:07:44,004
to try to get the at Mitchell handle.

749
01:07:44,164 --> 01:07:46,424
So hopefully that'll happen at some point.

750
01:07:46,684 --> 01:07:48,184
I don't know if there's any Mitchell

751
01:07:48,184 --> 01:07:50,024
with more clout than me on X.

752
01:07:50,104 --> 01:07:51,064
If so, I haven't seen them.

753
01:07:51,284 --> 01:07:52,404
There's not a lot of Mitchells out there,

754
01:07:52,504 --> 01:07:53,144
but fingers crossed.

755
01:07:53,384 --> 01:07:54,124
So in the meantime,

756
01:07:54,264 --> 01:07:55,684
you can find me at Mitchell Hoddle.

757
01:07:56,204 --> 01:07:58,344
And if you go to blockwaresolutions.com,

758
01:07:58,544 --> 01:07:59,984
you can learn more about Blockware.

759
01:08:00,084 --> 01:08:01,824
You can see our different hosting facilities.

760
01:08:02,264 --> 01:08:03,364
You can see our marketplace,

761
01:08:03,584 --> 01:08:07,104
which has real-time 24-7 live analytics

762
01:08:07,104 --> 01:08:08,484
on all the Bitcoin miners,

763
01:08:09,084 --> 01:08:10,484
their hash rate, energy consumption,

764
01:08:11,084 --> 01:08:11,784
revenue costs,

765
01:08:11,884 --> 01:08:12,944
everything you would need to know.

766
01:08:12,944 --> 01:08:14,304
You can see live, real-time,

767
01:08:14,604 --> 01:08:15,784
don't trust, verify.

768
01:08:15,784 --> 01:08:18,584
and if you're interested in mining Bitcoin,

769
01:08:18,864 --> 01:08:20,764
shoot me a DM and I'd be happy to help you

770
01:08:20,764 --> 01:08:23,464
leverage 100% bonus depreciation

771
01:08:23,464 --> 01:08:24,884
and stack Bitcoin at a discount.

772
01:08:25,544 --> 01:08:25,884
There we go.

773
01:08:25,984 --> 01:08:27,144
I'll put all that in the show notes.

774
01:08:27,284 --> 01:08:28,524
And Mitchell, thanks so much, boss.

775
01:08:28,944 --> 01:08:29,464
Thank you, Brandon.

776
01:08:30,144 --> 01:08:31,644
Thank you guys all for tuning in

777
01:08:31,644 --> 01:08:34,724
to another great episode of the State of Bitcoin podcast.

778
01:08:35,144 --> 01:08:36,384
If you found some value in this one,

779
01:08:36,484 --> 01:08:38,004
please hit that subscribe button

780
01:08:38,004 --> 01:08:40,504
and that like button to help send this one to the masses.

781
01:08:40,504 --> 01:08:42,024
And I've got a surprise for you guys.

782
01:08:42,164 --> 01:08:43,344
I've got two more episodes

783
01:08:43,344 --> 01:08:45,364
that you have the chance to watch here.

784
01:08:45,364 --> 01:08:46,604
to go ahead and click one of them

785
01:08:46,604 --> 01:08:48,364
and I'll see you guys all at the next one.