Strike Bitcoin Line Of Credit: What It Is & How I Use It

[0:03] Yo, what is going on Bitcoin? I am back
[0:07] with another product announcement. We
[0:09] have begun to officially roll out our
[0:11] Bitcoin line of credit product at
[0:14] strike. This is our new Bitcoin credit
[0:16] product designed specifically to help
[0:18] you effortlessly live on Bitcoin. Make
[0:21] Bitcoin more a part of your financial
[0:24] life. As a company, we pride ourselves
[0:26] on transparency and customer focus. And
[0:29] so anytime we launch anything, you'll
[0:31] get a video from me reviewing the
[0:33] problem we saw in the market, the
[0:35] solution we put together for you guys
[0:37] and how we use the product ourselves.
[0:39] I'm a customer of all of our products
[0:41] and I want to show you guys how I use
[0:43] this product. So without further ado,
[0:45] strike Bitcoin line of credit, living on
[0:48] Bitcoin, huddle Bitcoin, short fiat, and
[0:51] never sell a sat. Okay, what's the
[0:53] problem that we set out to solve here?
[0:55] Well, I think you guys are all going to
[0:56] be able to relate to this one. It's
[0:58] having to sell the winner. It's having
[0:59] to sell Bitcoin or never being able to
[1:02] stack any Bitcoin at all. So, you guys
[1:05] know what I'm talking about. First of
[1:06] all, every Bitcoin sale triggers a
[1:08] taxable event, which is brutal for a few
[1:10] reasons. One, taxes are expensive here
[1:12] in the United States of America. And
[1:14] two, you have to forfeit all of the
[1:16] upside from the Bitcoin, right? So,
[1:19] Bitcoin is the best performing asset
[1:20] ever. Selling it to fund rent or selling
[1:22] it to fund a car payment or selling it
[1:24] to pay back a friend. It's brutal.
[1:26] Imagine what those sats would be worth
[1:28] in 5 years. We've all been there. The
[1:30] other problem is when you do buy
[1:32] Bitcoin, it's only with what's left
[1:34] after your expenses. So, you believe in
[1:37] Bitcoin with everything that you have,
[1:39] but you're investing with scraps. It's
[1:41] really hard to come across a windfall of
[1:43] cash, whether you you sell a company or
[1:46] you get a massive bonus or you win the
[1:48] lottery. You have to come across a rare
[1:50] life event in order to build a really
[1:53] big Bitcoin position and be in the
[1:54] market long enough to build a Bitcoin
[1:56] base that you're really proud of. That's
[1:58] absolutely an issue I myself have faced
[2:00] and I know many other Bitcoiners have.
[2:02] The last one is the existing Bitcoin
[2:04] credit products in the market. Almost
[2:06] all the Bitcoin credit products are 12
[2:08] month loans. So there's these fixed
[2:10] duration loans which are really really
[2:12] good. Strike offers them for large
[2:14] lumpsum payments. You need to put a down
[2:16] payment on a house. You need to finance
[2:18] your wedding. Some massive event, some
[2:20] massive payment that you want to finance
[2:22] over 12 months collateralized by your
[2:24] Bitcoin. That makes perfect sense. I use
[2:27] that product as well. But it's not
[2:29] necessarily good to pay for your
[2:31] groceries in April, to finance your car
[2:33] payment in June, to make sure that your
[2:35] HOA or your mortgage is covered in July
[2:38] for living on Bitcoin. For that, you
[2:41] need a revolving line of credit. So that
[2:43] is the problem. And our customers were
[2:46] the ones that identified this right away
[2:48] with me. So this is a Reddit post from
[2:50] TJ78492.
[2:53] Feature request line of credit that
[2:54] works with bill pay with Strikes Bill
[2:56] Pay feature. That's the holy grail of
[2:59] living on zero. I want to pay my bills
[3:01] using a margin-like line of credit and
[3:04] have my direct deposit pay it off and/or
[3:07] buy Bitcoin. Loans are cool, but they're
[3:09] clunky. monthtomonth. I just want to
[3:11] borrow enough dollars until my check
[3:13] comes so that I'm always invested in
[3:15] Bitcoin. And that's exactly the idea.
[3:18] That's it right there. This tweet from
[3:21] New York Huddle. I want to pay my bills
[3:23] through the line of credit. I want to
[3:25] keep my Bitcoin. And so, as I started to
[3:27] tease this product, as I started to
[3:29] mention that it was improving my life so
[3:32] drastically, we started to see tweets
[3:34] and customer support tickets flying in.
[3:36] We want the line of credit. We want the
[3:38] line of credit. We want the block, the
[3:40] Bitcoin line of credit. And so the cost,
[3:43] again, it's really simple. I've shared a
[3:45] story personally on many podcasts. I
[3:46] bought a painting for six Bitcoin over a
[3:49] decade ago. Obviously, I regret that.
[3:52] Obviously, that was stupid. But more
[3:54] practically, sometimes you got to sell
[3:56] Bitcoin for rent. Sometimes you got to
[3:57] sell Bitcoin for tax bills. Sometimes
[3:59] you got to sell Bitcoin in bare markets
[4:01] at the lows when you know in your heart
[4:03] and your mind you don't want to and you
[4:05] shouldn't. But you don't have a choice.
[4:07] You don't have a choice because life
[4:08] costs money. Every single Bitcoiner has
[4:11] this story. And it's not because they
[4:13] don't believe in Bitcoin. It's not
[4:14] because they're wrong about Bitcoin.
[4:16] It's just because they don't have a way.
[4:18] They don't have a product. No one's
[4:19] built the experience to live without
[4:22] having to sell it. So, the insight for
[4:25] the product is really simple. What if
[4:27] you never had to sell? What if you could
[4:29] live your life with borrowed fiat while
[4:31] your Bitcoin stayed untouched,
[4:33] compounding over time, appreciating
[4:35] against the very fiat currency that
[4:37] you're spending? What if you can short
[4:39] fiat, long Bitcoin, and never sell a
[4:42] SAT? Can we put together a product that
[4:44] gives you that opportunity? And the
[4:46] philosophy is Gresham's law, guys. Bad
[4:49] money drives out good money. You spend
[4:51] the money that constantly loses value by
[4:53] design. You hoard the money that
[4:55] constantly gains value by design. And in
[4:58] 2026, that means borrowed fiat is spent
[5:01] and sats are saved. Period. It doesn't
[5:04] matter where you are. If you're in the
[5:05] worst emerging market in the world or if
[5:07] you're in Manhattan, we're all going
[5:09] through currency debasement. We're all
[5:10] going through inflation. And you hoard
[5:12] the scarce thing and you spend the
[5:14] abundant thing. And in America, in my
[5:16] life, that means you spend fiat, you
[5:19] spend the dollar, which is unlimited in
[5:20] supply. They make more of it every
[5:22] single year, and it's inflationary by
[5:23] nature. And you keep the Bitcoin, which
[5:25] is fixed in supply. It's the hardest
[5:27] money ever and it's scarce by nature, by
[5:30] design. So the math, the only real
[5:34] question that matters when thinking
[5:35] about building this product, when I was
[5:37] thinking about myself and implementing
[5:39] the strategy for me, the only question
[5:41] that matters is does Bitcoin beat your
[5:43] borrowing costs? Borrowing capital is
[5:46] never I mean outside of when central
[5:47] banks weirdly had interest rates at 0%.
[5:50] That was crazy. But theoretically,
[5:52] borrowing money is never going to be
[5:54] free. there's going to be a cost to
[5:56] borrowing money. The question is, the
[5:58] math is, can Bitcoin outperform your
[6:01] borrowing cost? So, here I have the
[6:02] borrowing cost at 13% APR. And the math
[6:06] in this slide is based on 50K a year in
[6:08] expenses. And obviously, if Bitcoin's
[6:11] annual growth is 0%, then not only is
[6:13] selling your Bitcoin a winning strategy,
[6:15] but you probably shouldn't be buying any
[6:17] Bitcoin. I don't know why you're a
[6:18] customer of Strike. I don't know why
[6:19] you're following me. I don't even know
[6:21] why you're here. If you think Bitcoin's
[6:23] never going to grow and isn't going to
[6:25] work, then yes, the strategy doesn't
[6:27] work. If Bitcoin's compounding at 13% on
[6:30] average, well, then you're break even.
[6:31] It's the equivalent of losing 13% of
[6:34] upside every year. This actually doesn't
[6:36] calculate taxes. So, selling would be
[6:39] worse if factoring in the taxes, but
[6:41] nonetheless, 13% would break even at a
[6:43] 13% APR. But the point is anything above
[6:47] that, if Bitcoin's a 30 kagger asset, a
[6:49] 50 kagger asset, or over the last
[6:51] decade, historically it's been an 80
[6:53] compound annual growth rate asset, then
[6:56] the difference between your borrowing
[6:58] cost and the performance of Bitcoin is
[6:59] working for you. It's building that
[7:01] capital base. It's building wealth
[7:03] towards your future home, towards your
[7:05] future kids, towards your future period.
[7:08] Towards your future period. And so I
[7:10] hear a lot about how these Bitcoin
[7:12] credit products are expensive. And don't
[7:14] get me wrong, obviously my goal is to
[7:16] make them as cheap as we possibly can.
[7:18] But I actually think the point is, can
[7:20] Bitcoin outperform the cost you have to
[7:23] borrow? And in my opinion, I'm bullish.
[7:26] I think unequivocally yes, over the long
[7:29] test of time. And so this is the
[7:31] greatest pair trade in history. I have
[7:33] the famous Pierre Roshard and Alan
[7:35] Ferington article quoted at the bottom.
[7:38] Bitcoin is such a pristine asset that
[7:40] its growing value makes it increasingly
[7:42] attractive as collateral against
[7:43] whichever deprecating fiat can be
[7:46] borrowed against it. Pierre Roshard and
[7:48] Alan Ferington speculative attack season
[7:50] 2 2024.
[7:52] So we see El Salvador as a nation do
[7:54] this. They have dollar denominated
[7:56] sovereign bonds. They stack Bitcoin
[7:58] against that. We see strategy and
[8:00] Michael Sailor do this. We see every
[8:02] Bitcoiner do this to some degree. If you
[8:04] have a mortgage and you own Bitcoin, you
[8:06] are speculatively attacking the dollar
[8:08] by having an outstanding debt item and
[8:11] having capital that isn't going towards
[8:13] paying down the principal, but saving
[8:14] for your future, right? And so the goal
[8:16] for me in this product, which I
[8:18] initially built for myself, and I'm very
[8:20] excited to share with you guys, is can
[8:22] we productize this for everyone? Can we
[8:24] turn everyone into a speculative
[8:26] attacker against fiat? Can everyone
[8:29] build their life around shorting fiat
[8:31] with Bitcoin? And that's what the strike
[8:34] block is. That's what the strike Bitcoin
[8:36] line of credit is. And so, like I
[8:39] mentioned, I built this for me. Um, this
[8:42] tweet, it says 15 hours ago in the
[8:44] screenshot. This is actually from a few
[8:45] years ago. Um, this is when I announced
[8:48] I officially owned no US dollars, no
[8:50] fiat to my name. Okay. I own a few
[8:53] things in my life. I own my house. I own
[8:55] equity in my two companies, which is 21
[8:57] and Strike. And I own Bitcoin. And
[8:59] that's it. And the logic for me is
[9:01] really simple. I don't want to be
[9:03] storing and saving any of my life's work
[9:05] in a money that's designed to go down
[9:08] forever. That's fiat currency.
[9:11] Conversely, I want to store as much as I
[9:14] possibly can in the money that's
[9:16] designed to appreciate, which is
[9:18] Bitcoin. Okay, so two years ago, I
[9:21] embarked on this journey to live my life
[9:22] on Bitcoin and to opt out of fiat
[9:24] entirely. In the beginning, I had to
[9:27] sell Bitcoin. It was the only way for me
[9:29] to live. Obviously, now selling Bitcoin
[9:31] was better than currency debasement, but
[9:33] it absolutely sucked. Of course, it
[9:34] sucked. And I've sold plenty of Bitcoin
[9:36] at prices I'd be ashamed to even
[9:38] mention, and it was absolutely brutal.
[9:40] Okay, I then moved to these 12-month
[9:43] loans. Strike launched this product. It
[9:45] was great, but it's really designed for
[9:46] large purchases, okay, or really large
[9:49] sums of cash if you need it. I did not
[9:52] need a 12-month loan to finance my
[9:54] everyday expenses, okay? I didn't want
[9:56] to pay interest on a large sum of cash.
[9:59] And also when you open a large sum of
[10:00] cash like that in a loan, what if
[10:02] Bitcoin enters a bare market? Then you
[10:04] got to go grab more collateral. You're
[10:05] looking up what's the margin call?
[10:07] What's the liquidation event? It's just
[10:09] not perfect for a lifestyle of living on
[10:12] my Bitcoin. I wanted a line of credit. I
[10:15] want it to be open-ended, always
[10:16] available. I only pay interest on what I
[10:19] actually draw and what I actually use. I
[10:21] hook my direct deposit and my paycheck
[10:22] up to it. That's the dream. And so the
[10:25] product didn't exist. And we built it.
[10:27] and I built it for me first and now I'm
[10:29] really really excited to share it for
[10:31] with you guys. So what is the product?
[10:33] I've talked about it enough at this
[10:35] point but you keep the upside. You don't
[10:37] have to sell the Bitcoin. You open a
[10:38] line of credit that draws against the
[10:40] Bitcoin so that you stay long your SATs.
[10:43] It is not a taxable event. It does not
[10:45] trigger a taxable event which is
[10:47] extremely exciting. It's open in
[10:49] seconds. Okay? So there's no credit
[10:51] checks. There's no invasive pay
[10:52] paperwork. I don't need to scan your
[10:54] eyeball. We don't need to know where you
[10:55] go to college. It's a collateralized
[10:57] line of credit. Transparent pricing.
[11:00] We're starting the pricing at 13% APR. I
[11:03] know some of the feedback we've gotten
[11:04] is that sounds expensive or ludicrous to
[11:06] you guys. I don't believe that's the
[11:08] case. I'll tell you why and I'll show
[11:09] you why in a second. But all that to
[11:12] say, our goal is not to make this
[11:14] product like super expensive. Our goal
[11:17] is to make it as inclusive and as
[11:20] attractive as we possibly can. And so we
[11:23] are working on that. I hear some of the
[11:24] feedback, but I believe 13% APR is
[11:27] plenty fine to live the dream Bitcoin
[11:29] life, which I'll show you guys in a
[11:31] second. And you only get charged on what
[11:33] you draw. So, you can open a line of
[11:36] credit that could go up to a certain
[11:37] amount, but if you don't use it, you
[11:39] don't have to pay for it. It really is
[11:40] the dream product. Real quick, our
[11:43] rollout strategy. This is live today in
[11:45] Massachusetts and in Georgia. These are
[11:47] two of the markets where we have some
[11:48] really loyal customers that wanted to
[11:50] use the product first. As as you guys
[11:53] can tell, this product's really personal
[11:54] to me. I really care a lot about the
[11:57] quality of it and making sure it goes
[11:59] well. This is a very unique Bitcoin
[12:00] product. I'm not sure what Strike offers
[12:03] today anyone's ever built before. So,
[12:05] we're rolling it out a bit slower than
[12:07] what we would usually do. This is not
[12:09] something that's going to take us a
[12:10] year. This is not something that's going
[12:11] to take us six months. We're going to
[12:13] turn it on in all of the United States
[12:15] very, very soon and then the rest of the
[12:17] world where we're available. So, I know
[12:20] for some of you it might be frustrating
[12:21] that you can't go into your phone and
[12:23] use it today. Trust me, it's coming.
[12:25] We're talking days or weeks or months. I
[12:27] just want to make sure the rollout is
[12:30] super high quality and it's as perfect
[12:32] as we can possibly make it. But if you
[12:34] are in Massachusetts and you are in
[12:35] Georgia, you can use it. And if you're
[12:37] dying and itching to get on that beta
[12:39] list, you can just shoot me a DM. I'll
[12:40] see what I can do. Okay? And again, I
[12:44] just want to highlight the difference
[12:45] here. It's very different than a Bitcoin
[12:46] backed loan traditionally like a
[12:48] 12-month one. Those you're opening up
[12:50] these large lump sums and that's what if
[12:52] Bitcoin goes in a bare market. You've
[12:54] drawn all this cash at once. That gets a
[12:56] little dicey. You're paying interest on
[12:59] this fixed lump sum. So, it's definitely
[13:01] more expensive. The principal is due in
[13:04] 12 months. And I use that product, but I
[13:06] use it for larger expenses in my life.
[13:09] Um, the Bitcoin backed line of credit is
[13:12] almost the exact opposite. You draw only
[13:14] exactly what you need in any time. Like
[13:16] when it's hooked up to your bill pay,
[13:17] you're only spending exactly to the
[13:19] penny what you need to pay to live your
[13:22] life. You're only acrewing interest on
[13:24] what you use. There is no due date. You
[13:26] can repay whenever you want. You can
[13:28] have the thing open for years. And it's
[13:30] optimized for living on Bitcoin. Maybe
[13:32] you don't go all 100% like me.
[13:34] Everyone's life is it's their choice and
[13:37] their circumstances, but it's designed
[13:39] to make Bitcoin more a part of your
[13:41] financial life in this dual economy or
[13:43] excuse me, dual currency era that we're
[13:45] living in where everyone needs to find
[13:49] scarce assets to hoard and everyone
[13:51] unfortunately needs access to fiat
[13:54] currency to live. We don't live in hyper
[13:56] bitcoinization yet and so this is the
[13:59] Gresham's law financial account. This is
[14:02] the Bitcoiner's dream in my opinion. So
[14:05] the product again, it's a beautifully
[14:07] designed product. It works as expected.
[14:09] Draw when you need, repay when you want.
[14:11] It's open in seconds. It cruise interest
[14:13] only on what you've drawn. There's no
[14:15] due date on the principal. It's it's
[14:18] unbelievable. So a few use cases just to
[14:21] show you the practical like
[14:23] mind-blowingness. Sorry, I'm excited
[14:25] about it. I I'm a customer and I love it
[14:27] so much. Uh so one, for those that don't
[14:30] know, you can pay your bills on Strike.
[14:31] So when you open a strike account in the
[14:32] United States, you get an account and
[14:34] routing number. And now your line of
[14:35] credit's like a payment method. So
[14:37] traditionally, like I had mentioned
[14:38] before, I was paying my bills with my
[14:40] Bitcoin balance, which was selling
[14:42] Bitcoin. Strike would take the cash
[14:44] proceeds and pay. So previously, you
[14:46] could pay your bills with your cash, you
[14:48] can pay your bills with your Bitcoin.
[14:49] Now you can pay your bills with your
[14:50] line of credit. If I have a $2,000
[14:52] credit card statement that I need to pay
[14:55] or a $1,300 mortgage payment I need to
[14:57] make, when that bill comes into Strike,
[15:00] Strike is extending your line of credit
[15:01] just enough to handle the bill and it's
[15:03] taking care of the bill for you. So, you
[15:05] can handle your mortgage, your credit
[15:07] card, your utilities, your energy, pay
[15:09] any bill through Strike. Only the exact
[15:11] amount owed is drawn down from your line
[15:14] of credit and used to pay the bill. And
[15:16] you're never holding idle cash. you're
[15:18] never holding idle fiat that you're
[15:20] long. Okay. You can also withdraw cash.
[15:24] So, if you need to get cash in your
[15:25] Chase account, your City account, your
[15:27] Bank of America account, your Wells
[15:29] Fargo account, and hit the ATM, you can
[15:31] open Strike, select your line of credit,
[15:33] you can withdraw cash straight to go go
[15:36] go to the ATM, use your line of credit
[15:38] to take cash out. It is an it's an
[15:42] unbelievable product. It acts like a
[15:44] native payment method. It acts like a
[15:46] linked bank account.
[15:48] What about sending money to other people
[15:49] on Strike? So, I use Strike to pay back
[15:51] my friends for dinners we go to or split
[15:54] vacations when I travel with my
[15:55] girlfriend and and our buddies. So, I
[15:58] pay my friends back with my line of
[16:00] credit now. So, when I go again, it's
[16:02] just another payment method. I can use
[16:03] my Bitcoin, I can use my cash, and now I
[16:06] can use my line of credit. And that even
[16:07] extends to buying Bitcoin itself. So, I
[16:10] have to admit sometimes when Bitcoin's
[16:12] been in this bare market and the price
[16:14] dips a lot, I turn on an hourly DCA and
[16:17] I start stacking with my line of credit.
[16:19] I'm like, screw it. Bitcoin's cheap and
[16:21] until the price rebounds a little bit,
[16:23] I'm going to take a little leverage, I'm
[16:24] going to buy some Bitcoin. Uh, and I'm
[16:26] going to use my line of credit. And it's
[16:29] just the product works and feels like
[16:31] magic. And then the last one is just how
[16:34] do you manage it? There's an
[16:36] unbelievably beautiful and intuitive
[16:37] dashboard inside of the app itself which
[16:40] shows you your line of credit, how much
[16:42] has been drawn, the interest that's
[16:43] accured daily, and then you can automate
[16:46] how you handle the line of credit
[16:48] itself. So for example, I have my direct
[16:50] deposit that goes into strike and my
[16:52] direct deposit will be dynamically set
[16:54] up to handle paying down my line of
[16:57] credit. So in this slide I have your
[17:00] paycheck arrives, 50% goes towards
[17:02] stacking more set sats, 50% goes towards
[17:05] paying down your line of credit
[17:06] principle and you're able to dynamically
[17:08] manage depending on your LTV and what
[17:11] risk you want, which I'll get into in a
[17:13] second. You can dynamically say, hey, I
[17:15] want to pay down my line of credit with
[17:17] my cash. I want to pay down my line of
[17:18] credit with my Bitcoin. I want to pay
[17:20] down my line of credit with the paycheck
[17:22] that is coming in because I have my
[17:23] direct deposit set up. Or I don't even
[17:26] want to touch my line of credit at all.
[17:27] I want to let it ride right now. It's
[17:29] super super intuitive product. Okay, I
[17:32] know this video is going to be a little
[17:34] bit long. Um, so if all you wanted to do
[17:36] was learn about the product
[17:37] announcement, you can say goodbye to me
[17:39] for now. But I think the obvious
[17:42] question that I want to address that
[17:43] everyone's going to ask is, well, what
[17:45] about a bare market? What about when
[17:46] Bitcoin crashes? Isn't this just super
[17:48] irresponsible leverage? What do you mean
[17:50] I never have to sell Bitcoin? Uh, and
[17:53] obviously I built the product for myself
[17:56] and I asked myself what's the most
[17:58] responsible way to use this tool because
[18:01] Bitcoin does crash. It goes through
[18:02] multi-year bare markets, people's income
[18:04] changes, all sorts of variables. And I
[18:07] wanted to know for myself. So over the
[18:09] weekend recently, so a few days ago, I
[18:11] actually built a tool for myself that I
[18:14] just put on the internet. It's at liveon
[18:16] bitcoin.jackmallers.com jackmalers.com
[18:18] and it helps showcase how I use the
[18:21] Strike Bitcoin line of credit in what I
[18:24] believe is an incredibly responsible
[18:26] way. So, I'm gonna click on it and I'm
[18:28] just going to walk you guys through it.
[18:29] Again, a little bit of a long video, but
[18:31] I think it's really useful. So, first
[18:33] you're going to get a modal. This is not
[18:35] financial advice, okay? I built these
[18:37] tools and these products because I
[18:39] believe Bitcoin is the best money ever.
[18:40] And I believe Bitcoin is the only
[18:42] financial tool that we all have access
[18:44] to to help deliver financial
[18:46] independence and prosperity for
[18:47] everybody. And I think in this currency
[18:49] debasement era, this could be a very
[18:51] empowering tool if you're in a position
[18:53] to use it responsibly. So I'm not your
[18:56] financial adviser. This is not financial
[18:58] advice. It's just education and a way
[19:00] for me to express my ideas that I think
[19:02] could potentially be valuable. So, the
[19:04] tool is very self-explanatory. Um, it's
[19:07] pretty straightforward, but I do want to
[19:08] walk you through it. So, on the left,
[19:11] you'll see some variable inputs. So, how
[19:14] much Bitcoin are you holding? Let's say
[19:15] you got one Bitcoin. This is pulling in
[19:17] the real-time price. Okay? It's rounded
[19:19] to the nearest thousand just for easy
[19:22] math and round numbers so it looks
[19:24] better. Uh, what's the monthly income
[19:27] that you're bringing in? What are your
[19:28] monthly expense expenses that you're
[19:30] spending? What's Bitcoin's annual growth
[19:32] rates? You could have it at 50%, 30%.
[19:35] You could put it at zero if you want.
[19:36] You could put it negative if you want.
[19:38] So, we'll put it 50% for now. We'll get
[19:40] back to that in a second. Um, inflation
[19:42] rate. What about inflation at the Fed's
[19:45] 2% target? 5%, 10%. Are you getting
[19:48] Miami Beachfront real estate 20%. And
[19:50] then your time horizon. How long are you
[19:53] thinking about this strategy for? Okay.
[19:56] Now, what you'll see in the middle here
[19:58] are different strategies. So, you'll see
[20:00] max leverage dangerous. This is I
[20:03] wouldn't recommend this. You'll see
[20:04] smart block, sell to live, and owning no
[20:07] Bitcoin at all. Okay. Now, what is max
[20:10] leverage? Max leverage is exactly what
[20:11] it sounds like. You use the line of
[20:14] credit for all your living expenses. So,
[20:15] at $5,000 of monthly expenses, that
[20:18] means you're spending $60,000 a year.
[20:20] That means over a fiveyear duration,
[20:22] you're spending 300 grand. And you're
[20:24] using the line of credit for all of that
[20:26] $300,000.
[20:27] All your paychecks are go going towards
[20:29] stacking SATs. you are piling on the
[20:31] ultimate leverage. Now, at the bottom
[20:34] here, I built what's called a stress
[20:36] test, which is what if Bitcoin crashes
[20:38] 80%. So, what if Bitcoin does go through
[20:40] a bare market? What if it goes through
[20:41] the worst crash Bitcoin's ever
[20:43] experienced in its history? Am I going
[20:45] to be okay? And the max leverage, this
[20:47] will show, would you be in a margin
[20:49] call? Would you get liquidated? Now,
[20:51] actually, if Bitcoin is compounding at
[20:54] 50% a year for five years, and you do
[20:56] max leverage, bringing in eight grand a
[20:58] month, spending only 5,000, you actually
[21:01] would barely survive. You wouldn't get
[21:02] mar you'd be in a margin call, you would
[21:04] you wouldn't get liquidated. But if I
[21:07] drag the five years here in the bottom
[21:09] left and I just bring it to four, you
[21:11] see that max leverage, you're getting
[21:12] blown out. And that's because obviously
[21:15] it's pretty logical. Bitcoin's not
[21:17] existing at a 50% kagger for enough
[21:19] years to build up the balance for you to
[21:21] survive a large crash. That's too much
[21:24] leverage. Your LTV is in a dangerous
[21:27] spot. Does that make sense? Now, the
[21:30] next logical question is, well, what is
[21:32] the smart strategy? This is just a math
[21:34] problem. Okay. What is a reasonable way
[21:37] to avoid having to panic during stress
[21:41] tests during bare markets, but living on
[21:44] a line of credit backed by Bitcoin and
[21:46] stacking SATs and building wealth for
[21:48] your future? And I call it smart block.
[21:51] Okay, the idea is very simple. You want
[21:54] to target an LTV around 15%. Because
[21:56] that LTV can survive multi-year bare
[21:59] markets, the craziest crashes Bitcoin
[22:02] has ever seen. It's a really really
[22:04] healthy approach to the product. And if
[22:06] you see the smart block down here in the
[22:08] stress test, I can turn Bitcoin's annual
[22:10] growth rate. I'll put it at zero and the
[22:13] smart block is fine. Or I'll put it at
[22:15] zero and I'll say that Bitcoin goes down
[22:17] 80% in a year and the smart block is
[22:20] fine. Because what the smart block does
[22:22] is it says, "Hey, if your LTV is getting
[22:24] too high for our liking, then part of
[22:28] your paycheck's going to go towards
[22:29] paying down the principal to keep the
[22:31] LTV intact." And so you're not just
[22:33] going to degenerately long Bitcoin all
[22:35] the time. It depends. What's the LTV?
[22:37] What's the price of Bitcoin? What's the
[22:39] risk? And so I actually built out a tab
[22:43] to go into Smart Block specifically. So
[22:45] let's take a look. So it's going to ask
[22:48] you really basic questions. What's your
[22:50] monthly income? So we have 8,000. And
[22:52] what's your monthly expenses? We have
[22:53] 5,000. Because the goal firstly is how
[22:56] productive are you? Meaning how much are
[22:58] you making relative to how much are you
[23:00] spending? Bitcoiners by definition,
[23:02] we're net producers because we have
[23:04] excess cash after we consume from the
[23:06] world, right? We are earning more than
[23:08] we're spending. And obviously, if I were
[23:11] to take my monthly income here and
[23:12] change it to $1,000, I'm not viable for
[23:15] this product because my monthly cash
[23:17] flow is negative. I'm not productive. I
[23:20] am spending more than I'm earning. So,
[23:22] I've always said in all my podcasts, if
[23:24] you want to build wealth, the first
[23:25] thing you have to do is be productive.
[23:27] You either have to find a way to make
[23:28] more money or find a way to consume less
[23:30] stuff. It's very, very simple. So, let's
[23:33] just assume that 8,000 bringing in
[23:36] spending 5,000 that's an income to
[23:38] expense ratio of 1.6. That's pretty
[23:41] healthy. Then it'll recommend
[23:44] a initial Bitcoin balance to
[23:46] collateralize your line of credit with.
[23:48] And this recommendation is really
[23:49] simple. It's targeting 5% LTV on day
[23:52] one. Okay? So obviously you can open the
[23:54] line of credit with a smaller balance.
[23:57] It's a little bit more dicey if Bitcoin
[23:59] gets into an 80% crash and it's way more
[24:01] ideal if you have more Bitcoin because
[24:03] then your LTV is even lower. You'll be
[24:05] stacking more sats. But then it has this
[24:07] monthly playbook here. So let's assume
[24:09] we've got 1.47 Bitcoin that we're
[24:12] bringing in $8,000 a month in income for
[24:15] our family or our business and we are
[24:18] spending $5,000 a month. You can drag
[24:20] the slider and walk through the
[24:23] month-to-month. So, you can see we start
[24:25] at a Bitcoin price of $69,53.
[24:29] And then eventually
[24:31] here, payown triggered. Our LTV is
[24:34] slightly over 15%. And so then it says,
[24:37] okay, 2% of your paycheck could should
[24:39] go towards paying down the principal.
[24:41] And the other 98% goes towards buying
[24:43] Bitcoin. And then as you drag this and
[24:45] you see the Bitcoin price, it's
[24:47] dynamically saying, "Oh, you should
[24:48] split your paycheck between stacking
[24:50] SATs and buying Bitcoin." Or at times
[24:54] it's you're good. You're like super
[24:56] healthy. You can just take your whole
[24:57] paycheck and you can stack SATs. So
[24:59] obviously if Bitcoin goes to 200K
[25:01] tomorrow, your LTV is great. You can
[25:03] stack SATs. If the price dips a little
[25:05] bit, if your income changes, if you need
[25:06] to spend a little bit more against your
[25:09] line of credit because it was an
[25:10] expensive month, well then maybe you
[25:12] just need to do a little bit more
[25:14] rebalancing. But if you scroll down and
[25:16] you see the results, I mean, a smart
[25:18] block versus just saving a surplus, I
[25:21] mean, it you're ending up with way more
[25:24] Bitcoin. This is the speculative attack
[25:26] against Bitcoin. This is the individual
[25:29] Michael Sailor micro strategy. Like this
[25:32] is this is it. This is the product I've
[25:34] always dreamed of. This is how I live
[25:35] without owning dollars drawing against a
[25:38] dynamic line of credit. And again, if I
[25:40] go back and you just want to do some
[25:42] testing, and please play with this. It's
[25:44] it's a tool for the public. These are
[25:46] free ideas. But if you want to click
[25:48] around and play with like where would
[25:50] the smart block find itself in trouble,
[25:53] um, you know, obviously there's a few
[25:55] ways you can solve this problem. Like if
[25:56] you have a lot more Bitcoin, let's say
[25:58] you have a hundred Bitcoin. Well, sure,
[26:00] then none of these strategies are a
[26:01] problem if you're only spending five
[26:03] grand a month and you've got a 100
[26:04] Bitcoin sitting around. But if that's
[26:06] not the case, you can drag these around,
[26:09] play with the tool. I even have a bare
[26:12] market phase here. So, you can turn this
[26:14] on and you can say, "Hey, Bitcoin's in a
[26:16] bare period for two years at 50%."
[26:20] Right? Like, what's
[26:23] what's the outcome here? And obviously
[26:26] max leverage is going to be in a world
[26:28] of pain, but the smart block is going to
[26:30] be fine. The smart block is going to be
[26:32] fine. So it even will model out what
[26:35] Bitcoin usually does, which is it goes
[26:37] through these periodic bare markets and
[26:39] then it snaps back up and averages
[26:42] something like 50% Kagger.
[26:45] So anyways, uh this is how I use the
[26:48] tool myself. Um, so I have my paychecks
[26:51] coming into strike and I'm just
[26:54] dynamically able to keep an LTV that
[26:57] allows me to be comfortable and sleep
[26:59] well at night. Now, obviously, if
[27:01] Bitcoin goes down 99.9%,
[27:04] then not only is my line of credit need
[27:08] to be addressed, but my whole life does
[27:11] because my life's built around Bitcoin,
[27:13] and if Bitcoin doesn't work, then I'm
[27:15] going to need a job doing something
[27:16] else. But the baseline assumption is do
[27:18] you think over a course of period of
[27:20] time Bitcoin can actually perform more
[27:23] than your borrowing cost that this whole
[27:24] Bitcoin thing is going to work? And if
[27:25] you're a Bitcoiner and you believe that
[27:27] I think this is a really empowering tool
[27:30] given it meets your criteria of the life
[27:32] you want to live. So anyways with that
[27:36] um this is the Bitcoiner's life hack uh
[27:39] that at least I built for myself and
[27:41] we're really excited to roll it out.
[27:42] Obviously, it's not going to be for
[27:43] everyone, but there are businesses out
[27:45] there like Bitcoin miners, I think,
[27:47] would love this product. They mine
[27:48] Bitcoin. They need to cover their their
[27:50] bills on a monthly basis. They probably
[27:52] want a line of credit. Uh I think
[27:54] there's plenty of families that can
[27:56] capitalize their future on an account
[27:58] like this. So, we're really excited to
[28:00] begin rolling it out. As you guys have
[28:02] questions and comments and concerns,
[28:04] please let us know. Um I listen to all
[28:06] of the feedback and my dream is to get
[28:08] everyone in the world benefiting from
[28:10] Bitcoin. And I think uh a line of credit
[28:12] like this that has bill pay and a direct
[28:14] deposit is a huge step. So thank you
[28:16] guys and thank you to all the customers
[28:17] for the support and uh I'll be on the
[28:19] lookout for the feedback as we continue
[28:20] to roll this out. Take care.