From Software to Hard Asset: Bitcoin in a New Liquidity Regime

[0:03] [sighs]
[0:03] >> Yo, welcome back to another episode of
[0:07] the Jack Mallers Show. I am your host
[0:11] Jack and you are tuning in to yet
[0:14] another
[0:15] episode of mailbag Monday, ladies and
[0:18] gentlemen, episode 104.
[0:21] The title of today's episode is from
[0:23] software to hardware Excuse me, from
[0:25] software to hard assets.
[0:27] Bitcoin and the new liquidity regime.
[0:30] Before we get started, let me timestamp
[0:33] this episode.
[0:36] Robot voice.
[0:38] Uh what's his guy's name? Bruce Buffer?
[0:41] Is that his name? Bruce Buffer.
[0:45] Yeah. Let's do my Bruce Buffer uh
[0:47] impersonation
[0:49] for Bitcoin price.
[0:53] With
[0:54] the Bitcoin price sitting at 70,440
[0:57] US dollars and a market capitalization
[1:00] of 1.41 trillion,
[1:03] 44.2%
[1:05] down from its all-time high of 126,160
[1:08] dollars set on October 6, 2025, 126 days
[1:14] out at a Bitcoin block height of
[1:16] 935,818,
[1:19] we have the orange coin, the stay humble
[1:21] and stack sats. BIT COIN!
[1:25] >> [laughter]
[1:28] >> UH Bitcoin price dip. Uh I'm clocking in
[1:32] to you guys at a little over 70,000
[1:34] dollars per Bitcoin, 1.41 trillion
[1:37] dollar asset class in size, and the last
[1:40] Bitcoin block mined was Bitcoin block
[1:42] height 935,818.
[1:46] The title from software to hard asset,
[1:48] Bitcoin and the new liquidity regime.
[1:50] Without further ado,
[1:52] let's get started. Okay, here's my
[1:54] thesis for today's episode. So, Bitcoin
[1:57] took a beating. It was one of the worst
[1:59] days ever recorded in Bitcoin's history.
[2:02] I've talked to you guys about the the
[2:04] infamous COVID day when we were down
[2:06] 550%
[2:09] in one day.
[2:10] Um this felt
[2:12] similar-ish. There was definitely a It
[2:16] was definitely a slaughterhouse. I mean,
[2:17] Bitcoin fell, I think it was 20% in a
[2:21] day, which for a multi-trillion-dollar
[2:23] asset is quite the drop. Um that is
[2:26] intense.
[2:27] Um it was a crazy day across both
[2:29] companies. Uh and so, trying to
[2:31] understand what is going on,
[2:33] uh why did Bitcoin fall? What does it
[2:36] have to do with broader macroeconomics?
[2:38] I've believed very fundamentally that
[2:40] Bitcoin is a macro asset. In fact, it
[2:43] may be the most true and freely tradable
[2:45] macro asset that the world has access
[2:47] to.
[2:48] So, over the weekend, I took a deep dive
[2:52] and did a little bit of research and
[2:53] kind of came up with
[2:55] what I think is a really inspiring
[2:57] thesis. So, I put together a tweet storm
[3:00] that basically uses this episode in
[3:02] tweet form. Um so, if you haven't
[3:04] checked it out, go check it out. But, uh
[3:06] this is the thesis. I wrote, "Bitcoiners
[3:09] have long viewed Bitcoin as the solution
[3:11] to currency decline.
[3:12] It's better gold. It's the ultimate
[3:14] money. Instead, the broader market has
[3:17] treated it like a software stock.
[3:19] Painful, but this dip may be how Bitcoin
[3:22] stops trading like tech and starts
[3:24] trading like a hard asset. Okay? So, my
[3:27] thesis is, you know, unfortunately,
[3:29] although Bitcoin is the only
[3:31] fixed-supply money in the history of
[3:33] mankind, right? Although Bitcoin's the
[3:35] best money we've ever invented,
[3:37] properties like divisibility,
[3:38] portability, how easy it is to store,
[3:41] saleability and liquidity, its ability
[3:43] to transcend borders, its monetary
[3:45] policy, everything about Bitcoin is
[3:48] pound for pound better than fiat, better
[3:50] than gold, better than anything you can
[3:53] own. But weirdly, very weirdly, Bitcoin
[3:57] has traded almost like a technology
[4:00] stock, like a software stock.
[4:02] And so, I think that this dip has a lot
[4:05] to do with the software stock piece.
[4:09] People complaining my volume is low.
[4:15] Uh
[4:16] Okay, what about now?
[4:18] Um
[4:19] Sorry about that. Not a professional
[4:21] podcaster. Uh so
[4:25] Uh
[4:26] Where was I?
[4:27] Oh, okay. Uh
[4:29] I think this dip has a lot to do with
[4:31] Bitcoin's weird relationship with
[4:33] software technology.
[4:35] Um and I actually think that this dip is
[4:37] going to be really healthy for Bitcoin
[4:40] in the long term because inevitably, at
[4:42] some point, we're going to have to
[4:44] resolve of the fact that Bitcoin is
[4:46] trading like a tech stock and it's not a
[4:48] tech stock. It's the best money in human
[4:49] history. And so, at some point, we're
[4:51] going to have to grow out of that as an
[4:53] asset class and we're going to have to
[4:54] mature through that. And I actually
[4:56] think that that might be happening right
[4:58] now. And albeit painful, um absolutely
[5:01] necessary. Every dip is good for the
[5:04] longer cause of Bitcoin becoming the
[5:06] best money of all time. So, without
[5:08] further ado, let's get started. Chapter
[5:09] 1, Bitcoin isn't trading like gold, it's
[5:12] trading like software. We've talked
[5:14] about this before. Bitcoin's correlation
[5:16] to gold is 0.09, meaning effectively
[5:18] zero correlation. They never moved at
[5:20] the same time. But what Bitcoin does
[5:23] seem to be highly correlated with, and
[5:25] what it is trading like, is software
[5:26] technology stocks.
[5:28] So, first of all, why is Bitcoin
[5:30] dumping? What are people missing?
[5:32] Um I'm here to make the case that, you
[5:35] know, liquidity, I've I call it
[5:37] relocating. Uh and we'll dig into what
[5:40] that means and why,
[5:42] but a lot of the capital, at least in in
[5:45] United States, but also globally, is
[5:47] leaving software. Okay, software is
[5:50] going from being an extremely cash
[5:53] abundant, cash producing asset,
[5:56] and it's becoming really capital
[5:58] intensive.
[5:59] And for that reason, capital is leaving
[6:03] software. It's not this like cash
[6:06] machine anymore. In fact, the CAPEX of
[6:09] these companies is going through the
[6:10] roof. You combine that with the fact
[6:12] that the United States of America is
[6:15] trying to incentivize capital to invest
[6:18] more domestically in infrastructure, in
[6:20] energy, in power, in critical minerals,
[6:23] in defense, and less in these like
[6:25] really frothy tech multiples that have
[6:29] created this massive wealth gap. You
[6:31] know, the Trump administration has
[6:32] talked about Main Street over Wall
[6:33] Street. Now, whether that's true or not,
[6:35] whether you believe them or not, it
[6:36] doesn't really matter. The point is the
[6:38] Biden administration and the Trump
[6:40] administration, the left and the right,
[6:42] the blue and the red, the Democrat and
[6:43] Republican, they're trying to do the
[6:45] same thing. They're trying to unwind
[6:47] from the post-71 dollar, from the US
[6:50] dollar as the world reserve currency.
[6:52] They're trying to build back US defense
[6:55] capabilities, US infrastructure
[6:57] capabilities, manufacturing
[6:58] capabilities, build back the middle
[7:00] class. That is unequivocally what the
[7:02] United States is trying to do. They have
[7:03] realized that they have an issue. They
[7:05] have realized they've hollowed out their
[7:07] middle class, hollowed out their defense
[7:08] base, hollowed out their manufacturing
[7:10] base, and it's caused such a problem,
[7:12] such a reliance on China, uh political
[7:14] instability in the country, uh things
[7:17] like drug overdose, things like suicide
[7:19] rates, things like obesity rates,
[7:20] metabolic disease, um assassination
[7:23] attempts rivaling the Civil War, all of
[7:25] the problems that signal a collapsing
[7:27] empire. Okay?
[7:29] Um the other thing is just it's very
[7:31] obvious where the liquidity is going, as
[7:33] I just said. Uh it's going to CAPEX,
[7:35] it's going to energy, it's going to
[7:36] industry, it's going to defense, it's
[7:38] going to critical minerals, it's going
[7:39] to all the things I just referenced.
[7:41] The interesting thing that we'll talk
[7:43] about on the show is why the hell does
[7:45] that mean Bitcoin has to take a
[7:46] clobbering, right? That's To me, that's
[7:49] kind of what I figured the most valuable
[7:51] thing I can do for the episode today is
[7:54] walk you guys through, well, why is
[7:56] Bitcoin caught in the middle of all
[7:57] that? Bitcoin's supposed to be like
[7:59] gold. Bitcoin's a hard asset. Why is
[8:01] Bitcoin getting clobbered like software
[8:03] as that's rotating into critical
[8:05] minerals? It doesn't make any sense.
[8:06] Okay. Well, first of all, you know, a
[8:08] picture's worth a thousand words. So,
[8:10] for those watching, in the orange is the
[8:13] Bitcoin price, in the white is the
[8:15] software ETF. So, software stock ETFs.
[8:18] And the point is they're one for one.
[8:20] They're moving the exact same, and this
[8:23] is from 2025 up until today. So, this is
[8:25] not over the last few days, few weeks,
[8:27] few months. This is over the last year.
[8:29] Okay?
[8:30] For those listening,
[8:31] I think I just described it, but I know
[8:33] a lot of you guys are listening and not
[8:35] watching on YouTube.
[8:37] The correlation between, which I'll show
[8:39] in a second, uh tech and Bitcoin is
[8:43] above 0.8, where one is directly
[8:46] correlated. They move to the pixel the
[8:49] same. Okay?
[8:51] So,
[8:52] importantly, what does this mean?
[8:54] Correlation, specifically in this
[8:56] instance as well, tells us who owns
[8:59] these assets. Tells us the asset owners
[9:02] are the same. Okay? So, the point that I
[9:05] need you guys to understand is despite
[9:08] us Bitcoiners, this little nerdy corner
[9:10] of the internet that is finally finding
[9:12] themselves listening to me live every
[9:14] Monday,
[9:15] we know and we hold Bitcoin as hard
[9:18] money. Take me as an example.
[9:21] I work for Bitcoin. My paychecks get
[9:23] swept into Bitcoin. I save in Bitcoin.
[9:25] Bitcoin to me is not a software tech
[9:29] stock. Bitcoin to me, I'm monetizing
[9:31] Bitcoin. I'm using it to save. I'm using
[9:34] it to then later exchange for the things
[9:35] I need in my life.
[9:38] So, I'm using Bitcoin as hard money, as
[9:40] hard asset.
[9:42] Okay? I'm monetizing it. Now,
[9:44] what about other people? What about the
[9:46] broader market? The broader market,
[9:48] unfortunately, has viewed Bitcoin as
[9:51] monetary software,
[9:53] like a software stock.
[9:55] And you can see this now in the
[9:57] correlation of the software ETF and
[9:59] Bitcoin.
[10:00] As software has gotten clobbered, that
[10:02] means software's deleveraging. That
[10:04] means people are taking capital out and
[10:07] rotating it into other things.
[10:10] Bitcoin has gotten lumped into that. So,
[10:12] this is very obvious proof
[10:15] that a decent chunk of Bitcoin holders,
[10:18] a non-zero, a a a material chunk of
[10:23] Bitcoin holders have historically also
[10:25] been these software holders, okay?
[10:28] So, despite how much we want to believe
[10:31] it on our corner of the internet that
[10:33] Bitcoin is held by hodlers of last
[10:34] resort, and we all are never going to
[10:37] sell, and we're all like Michael Saylor,
[10:40] this correlation chart shows that that's
[10:41] not necessarily true. And to be honest,
[10:43] I actually started to notice this
[10:45] pattern about 10 years ago. The run-up
[10:48] in 2017,
[10:50] we started to see a lot newer entrants.
[10:53] These were levered hedge funds, levered
[10:55] funds. That was when I wouldn't say Wall
[10:58] Street, like today Wall Street's Larry
[11:00] Fink and
[11:01] uh and all BlackRock and all these guys.
[11:04] Not that Wall Street, but fast money
[11:07] Wall Street. Day traders, levered funds,
[11:10] long-only positions. That's when I
[11:13] started to see these guys show up. So,
[11:14] this is not recent. People will say,
[11:16] "Oh, this is since the ETFs." No, no,
[11:18] no, no, no.
[11:19] This is the This is a product of the of
[11:22] the system, of policy. When you print so
[11:25] much money, and you know, as we've
[11:28] talked about, the coasts of America
[11:30] benefit tremendously from what has been
[11:33] monetary policy in the United States
[11:35] over the last 40 years. They go in and
[11:37] they punch software and software has
[11:38] these crazy multiples. Bitcoin's got
[11:40] this crazy volatility. Um so on and so
[11:43] forth. So,
[11:45] back to the liquidity rotation we're
[11:46] living through. Okay? Liquidity is
[11:49] leaving software,
[11:52] equities that are dependent on buybacks.
[11:54] So, a lot of the premium that was placed
[11:57] on stocks like Amazon is because Amazon
[12:00] would take the immense amount of cash
[12:02] profit they were producing and they
[12:04] would buy back the equity. And so, the
[12:06] premium is justified because they are
[12:09] buying the asset that they're they're
[12:11] creating demand with their cash flow,
[12:14] with the asset that I own. Okay? It's
[12:17] rotating out of momentum and leverage.
[12:20] So, things are deleveraging
[12:22] tremendously.
[12:23] And the overall
[12:25] structure of the market, the market
[12:27] structure is changing. You know, we're
[12:28] slowly shifting out of these passive
[12:31] flows. Okay?
[12:33] Liquidity is finding itself into new
[12:35] CapEx. So, we'll get into in a second
[12:38] all of these massive big tech companies
[12:39] are spending hundreds of billions of
[12:41] dollars a year on infrastructure. It's
[12:43] going into energy, industrials, critical
[12:45] minerals, infrastructure. What people on
[12:49] TV call the real economy. Okay? So,
[12:53] capital is moving in real time. I
[12:56] referenced this earlier, Bitcoin's
[12:57] correlation to tech stocks is
[13:00] approaching 0.8, which is extreme. And
[13:04] if you look at it through its history, I
[13:06] kind of talked about about a decade ago
[13:09] is when I started to notice this
[13:11] correlation like really starting to
[13:13] hike. And you can visualize it in this
[13:15] chart. You know, around COVID, it looks
[13:18] like especially um the correlation of
[13:20] tech stocks. And again, it's a result of
[13:24] what has happened. Okay? What has
[13:26] happened is when you just print ungodly
[13:28] amounts of money, the incentive is for
[13:32] asset holders to continue to punt
[13:34] assets. Uh what's been hot in the 2010s
[13:37] was tech.
[13:38] Bitcoin for a lot of asset holders got
[13:41] bundled into this software tech
[13:43] category. As Bitcoiners, we've always
[13:46] said Bitcoin's not a company. Bitcoin's
[13:49] not tech. Why isn't it trading like
[13:52] gold? Well, because the people owning
[13:54] Bitcoin didn't believe clearly the same
[13:56] things we believe. They didn't value it
[13:58] like gold. They weren't monetizing it.
[14:00] They weren't using it like hard money.
[14:02] Bitcoin was allocated in this slush hash
[14:05] posh portfolio of software tech levered
[14:08] hedge funds. And Bitcoin got caught in
[14:11] the liquidity rotation recently and
[14:13] that's happening as I'm talking because
[14:17] a lot of people that owned Bitcoin
[14:19] didn't own it for the right reasons and
[14:21] they got wrecked, okay?
[14:23] So, why is software taking a beating?
[14:26] Let's just We have to understand from a
[14:28] macro standpoint. I'm going to be a
[14:30] little bit rhetorical here, but
[14:33] we got to nail this point.
[14:35] One, the most important point, the
[14:37] biggest catalyst to what's happening is
[14:40] AI.
[14:41] AI is changing the economic profile of
[14:44] these software companies. Meaning, these
[14:47] software companies are going from
[14:49] companies that are producing
[14:51] massive record-breaking amounts of cash,
[14:54] okay? Meta,
[14:56] Microsoft, Amazon, Google. Like these
[14:59] companies are I mean, they're
[15:01] historically known for being the most
[15:03] profitable things to ever exist in the
[15:07] course of mankind, okay?
[15:10] They have now turned into insanely
[15:13] capital intensive businesses.
[15:16] They're forward projecting like you're
[15:18] seeing their earnings calls and it's
[15:19] like Amazon CapEx changed from 100
[15:22] billion to 200 billion, doubling their
[15:25] cap expenditures.
[15:27] Okay? The second reason is structural to
[15:30] the United States. As I've said, the
[15:32] United States has exported the dollar,
[15:35] exported their jobs, exported their
[15:36] manufacturing base, exported their
[15:38] defense base.
[15:40] Being the world reserve currency, doing
[15:42] no proof of work, the last 20 to 40
[15:44] years has entirely eroded the country.
[15:48] And that's not a political statement.
[15:50] That is a left, right, blue, red, Biden,
[15:53] Trump, doesn't matter how you slice it.
[15:56] We have all the characteristics of a
[15:58] falling and collapsing empire.
[16:01] And Washington, D.C. is trying to fix
[16:03] it. One of the ways they're trying to
[16:05] fix it
[16:06] is redirect all of this capital into
[16:09] places that benefit the country's
[16:11] agenda. The country's agenda are
[16:14] re-industrialize,
[16:16] build back a manufacturing base, bring
[16:18] blue-collar jobs back,
[16:21] bring back our defense base, reduce our
[16:24] reliance on China, hoard our own
[16:27] critical minerals, etc., etc., etc.
[16:30] Drastically reduce the US dollar's role
[16:33] as the world reserve currency. Okay?
[16:35] Weaken the dollar.
[16:37] Neutral assets go up. All of these
[16:40] things, the combination of these two
[16:42] results in software getting its ass
[16:44] kicked.
[16:47] If these software companies are not
[16:48] immensely profitable cash machines,
[16:50] which then take the cash and give it
[16:52] back to shareholders in what we call
[16:55] stock buybacks, they don't literally pay
[16:57] out dividends, but they just take the
[16:58] cash, buy the stock, the stock goes up.
[17:01] That's why you own the stock.
[17:04] The combination of that and the United
[17:06] States' agenda and where we are in this
[17:08] fourth turning and, you know, regime
[17:11] change globally,
[17:14] big tech is it's software's changing.
[17:18] Highly leveraged, high time preference
[17:20] software stock punters are getting
[17:23] destroyed. And that liquidity is
[17:26] rotating, okay? So, chapter two is how
[17:29] AI changes the economics of software.
[17:32] So,
[17:33] this all started to really exaggerate
[17:36] and get intense when this Anthropic
[17:39] model came out recently. So, this CNN
[17:43] title, Anthropic's new AI tool sends
[17:45] shudders through software stocks. This
[17:47] was published February 4th. Stock
[17:49] slumped on Tuesday amid nerves about AI
[17:52] disrupting the software industry. And
[17:54] then we all know what happened last week
[17:56] after stocks started to tumble, leverage
[17:59] beats up leverage, which beats up
[18:01] leverage, which beats up leverage, and
[18:03] you get these cascading effects where a
[18:05] simple downward move of liquidity
[18:07] getting punished and leverage getting
[18:09] punished cascades on itself, and before
[18:11] you know it, Bitcoin is down 25%.
[18:13] Right?
[18:14] Now,
[18:16] it's important to note,
[18:19] and this is a small nuance, but I think
[18:20] it's important.
[18:22] It's not like because people will say,
[18:25] "Jack, you're being hyperbolic.
[18:27] Facebook Meta's not dying as a company.
[18:30] Google's not dying as a company." I'm
[18:32] not saying that
[18:34] because you guys need to take, you know,
[18:36] my thoughts as they are, and they're
[18:38] realistic, and they're practical, okay?
[18:41] It's not killing software companies,
[18:43] it's killing the premium, okay? So much
[18:46] of the liquidity was going into these
[18:49] companies trading at 50 to 100 times
[18:51] multiples. Like what like Tesla. Tesla
[18:53] trades at an insane multiple. You'll
[18:56] never get paid back if you were to buy
[18:57] that business at its market cap value,
[19:00] okay? It's killing the premium. The
[19:02] premium is no longer justified, okay?
[19:06] Because the old software model was that
[19:09] these businesses were light on assets.
[19:11] They didn't have very large capex. It
[19:13] didn't require a lot of investment to
[19:15] run them.
[19:16] Extremely high margins.
[19:19] And they would could do buybacks. They
[19:20] had so much cash. So, high scale, high
[19:24] TAM, high margins, asset light
[19:26] businesses. Okay? Now, in the AI world,
[19:30] that's all changed.
[19:32] They are high compute, high data center,
[19:34] high spend, high power, high chip
[19:36] businesses.
[19:38] There's not that much cash left over. In
[19:40] fact, many of them are spending more
[19:42] than they earn. Google just had a
[19:44] 100-year bond sale today.
[19:50] So, the point is when you go from very
[19:53] cash rich
[19:55] and a liquidity profile in the 2010s,
[19:58] where it's just print money, print
[19:59] money, print money, assets, assets,
[20:02] assets, tech, tech, tech, and that's
[20:04] changing. I've talked about this before.
[20:07] You know,
[20:08] as humans, I fundamentally believe we
[20:09] are best governed by Mother Nature.
[20:11] Okay? We are a product of the universe.
[20:15] And the further we get away from being
[20:18] governed by the laws of the universe,
[20:20] like proof of work,
[20:23] and we're governed by unelected central
[20:25] bankers or politicians in DC, the worse
[20:29] off society becomes. And I think, you
[20:31] know, there there's very cyclical
[20:33] behavior in humans making a lot of
[20:35] progress, innovating a lot with new
[20:37] technology, but then finding themselves
[20:40] strayed too far away from the laws of
[20:43] the universe, from Mother Nature, from
[20:45] being governed by who we're meant to be
[20:46] governed by.
[20:49] And then we kind of like reprice and
[20:50] recorrect back to our norms. And we're
[20:52] living through that reprice,
[20:54] recorrecting.
[20:55] Where we're repricing what's real. Proof
[20:57] of work is real. Things like gold are
[20:59] real. Things like land are real.
[21:02] Things like critical minerals are real.
[21:04] Things like the ability to defend
[21:05] yourself and your defense base is real.
[21:08] Things that aren't real.
[21:10] Printed pieces of paper, hundred time
[21:12] multiples on businesses. Like none of
[21:14] that that is Narnia. That is dumb. That
[21:16] is stupid. Okay? That is fabricated
[21:19] la-la land. Okay? So, things like
[21:22] silver, gold, Bitcoin, land, critical
[21:25] minerals, energy.
[21:27] Real things, mother nature things.
[21:30] All being repriced. Okay? So, this
[21:32] headline from CNBC
[21:34] Tech AI spend maybe approaching $700
[21:37] billion this year, but the blow to cash
[21:41] raises red flags. Again, that's my
[21:43] point. They are now spending insane
[21:45] amounts of money and the red flags
[21:47] raised are the fact that it's going to
[21:49] eat into their cash flow.
[21:51] CapEx number go up. This is big tech's
[21:55] CapEx growth in Q1 of 2023, they spent a
[21:59] little over $100 billion combined. They
[22:02] are approaching a trillion dollars
[22:04] projected this year. That is absolutely
[22:07] insane. This is Again, guys, this is not
[22:11] a trend. This is not a fad. This is a
[22:14] factual regime change we are living
[22:17] through. Another eye-watering CapEx
[22:19] number, Amazon sees 2026 CapEx about
[22:22] $200 billion.
[22:25] That is well above their estimated $146
[22:28] billion. Holy moly. Wild stat of the
[22:32] day. Amazon has spent more on CapEx in
[22:35] the last 3 years than in the previous 26
[22:39] years combined.
[22:42] Regime change, guys. AI is changing
[22:45] things.
[22:47] The world is changing. The
[22:49] US dollar as the world reserve currency
[22:52] is fundamentally changing. We are living
[22:54] through, whatever you want to call it, a
[22:56] fourth turning. Whatever you want to
[22:58] call it. The change is absolutely real.
[23:01] Okay?
[23:02] Here's a fun fact for you. Amazon has
[23:05] never been cheaper on a PE ratio
[23:08] multiple basis ever.
[23:10] It's trading at 20 29 times multiple.
[23:14] That is as cheap as Amazon has ever
[23:17] been, ever.
[23:19] So, is the stock price as cheap as it's
[23:21] ever been? No, that's not what I'm
[23:23] saying. I'm saying the multiples are
[23:25] going to compress, which is another way
[23:27] of saying the liquidity is going to seek
[23:29] a new home. This is why software is
[23:31] getting its ass beat. Market structures
[23:35] are changing. Real things are being
[23:37] repriced, okay?
[23:40] Another fun fact, I just found these
[23:41] astonishing. Google
[23:44] has hit an all-time high
[23:46] in profit, $132
[23:49] billion of annualized profit. That is
[23:54] absolutely insane. This chart is so
[23:57] impressive. The stock price? Down.
[24:01] That's crazy.
[24:03] The profit is making all-time highs and
[24:06] the stock is down. How is that possible?
[24:08] Well, the business could be getting
[24:10] stronger, but the stock could be getting
[24:13] weaker because the multiples are
[24:14] impressing, the liquidity's finding a
[24:16] new home. We're living through a regime
[24:18] change, okay? So, you guys get the
[24:20] point.
[24:21] We move on to chapter three titled
[24:24] lookout below. Here comes the pain,
[24:27] okay? So, first of all, the quiet part
[24:29] out loud. Um
[24:31] I don't really use LinkedIn, and when I
[24:33] say I don't really use it, I mean I
[24:35] don't use it at all. It's funny, I do
[24:38] have a LinkedIn profile um so that I can
[24:40] click on links when people send it to me
[24:42] or, you know, sometimes look at resumes
[24:44] when we're hiring people.
[24:47] But, um it's funny cuz someone said
[24:49] there's so many Jack Mallers spoofs out
[24:51] there on LinkedIn. You have to
[24:54] you know, show everyone you the re what
[24:55] the real account is. So, my name on
[24:58] LinkedIn is like Jack Mallers in
[25:00] parentheses, I'm the CEO of Strike.
[25:03] I [laughter]
[25:04] don't know, it's funny. But anyways, I
[25:06] think LinkedIn is stupid. But what I
[25:07] found hilarious
[25:09] is Larry Fink posted on LinkedIn.
[25:13] And what he said was
[25:16] the quiet part out loud was outrageous.
[25:19] So, uh you guys can look this up. I'm
[25:21] sure you know LinkedIn better than me.
[25:23] Um but the title of the post from Sir
[25:26] Larry Fink was my remarks as interim
[25:28] co-chair of the World Economic Forum at
[25:31] the 2026 annual meeting in Davos, okay?
[25:34] And on the right, a little bit down in
[25:35] the article, not too far down, in the
[25:37] first section,
[25:39] I will just read you guys the section
[25:40] quickly.
[25:42] Titled Broadening Prosperity, Prosperity
[25:44] isn't just growth in the aggregate. It
[25:46] can't be measured by GDP or the market
[25:48] cap of the world's largest companies
[25:50] alone. It has to be judged by how many
[25:52] people can see it, touch it, and build
[25:55] the future on it. That, in my view, is
[25:57] the strongest critique of the last
[25:59] economic era. Since the fall of the
[26:01] Berlin Wall,
[26:03] more wealth has been created than in all
[26:05] prior years of human history combined.
[26:09] But in advanced economics, that wealth
[26:11] accrued to a far narrower share of
[26:13] people than any healthy society can
[26:16] sustain.
[26:19] Now, AI threatens to replay that same
[26:23] pattern. Early gains are flowing to the
[26:26] owners of the models, the data, and
[26:28] infrastructure. The open question is
[26:30] what happens to everyone else. Now, this
[26:33] is the part I have highlighted, guys.
[26:35] Listen closely.
[26:38] If AI does to white-collar work what
[26:42] global globalization did to blue-collar
[26:45] work,
[26:46] we need to confront that directly.
[26:50] Not with abstractions about the jobs of
[26:53] tomorrow, but with a credible plan for
[26:56] broad participation in the gains.
[27:01] The quiet part out loud. What is Larry
[27:04] Fink talking about? First of all, he
[27:06] just openly acknowledged that the last
[27:09] decade or few decades, last, you know,
[27:12] some odd decades has created the most
[27:15] wealth in human history, but
[27:17] not in real GDP growth. Not in anything
[27:20] that you can touch or feel. Not in
[27:22] anything actually productive. We talk
[27:24] about on this show a lot, net
[27:26] productivity. Do something valuable for
[27:28] society, right? He's talking about
[27:30] wealth creation in nominal terms, in
[27:32] dollar terms. It's another way, it's a
[27:34] politically correct way of saying Larry
[27:36] Fink just acknowledged we've printed
[27:37] more money in the last some odd decades
[27:40] than ever before in human history.
[27:42] That's what he just said, which is true.
[27:45] And he said we don't really have that
[27:46] much to show for it, but a really small
[27:49] populace of of rich people. There's like
[27:51] a little tiny sliver of humanity that's
[27:54] ungodly rich because they're asset
[27:56] owners and have benefited from the money
[27:59] printer.
[28:00] And then he goes on to say, "By the way,
[28:02] do you remember what happened to
[28:04] blue-collar workers when globalization
[28:06] kicked off? Well, white-collar workers
[28:08] are going to face the same pain because
[28:11] of AI. We don't have a plan." I've never
[28:16] I mean, the Ray Dalios of the world, the
[28:18] Larry Finks of the world, the fact that
[28:20] these guys are saying what I'm saying on
[28:22] my show
[28:24] means shit's really going down. I used
[28:26] to be like, "Whoa, you know, Jack
[28:29] really's out there with his commentary.
[28:31] Is that that guy needs to be careful.
[28:33] Does he have security?" That's how
[28:35] people used to comment on my shows. Now
[28:37] Larry Fink and I, we we got the same
[28:40] opinions. We say the same [ __ ] when
[28:42] we're getting interviewed.
[28:43] Okay, so what is Larry Fink talking
[28:45] about? Well, this is the uh
[28:48] employment in manufacturing in the
[28:50] United States.
[28:52] Uh and this is visualizing his comments
[28:55] about globalism and what happened to
[28:56] blue-collar workers. So, for those of
[28:58] you listening and not watching the
[29:00] visuals here, in 2000, it fell off a
[29:03] cliff. What happened in 2000? China
[29:06] joined the World Trade Organization in
[29:09] 2001. And as we've talked about, if you
[29:11] want to be the world reserve currency,
[29:14] you have to you run deficits. You have
[29:16] to export the dollar. You have to import
[29:18] the stuff you consume. You do not make
[29:20] the stuff you consume. Your currency is
[29:22] strong, your assets are strong, but your
[29:24] labor force is tremendously weak because
[29:26] it's not competitive. So, China
[29:28] therefore has become the world's
[29:30] factory. So, all of these jobs did not
[29:32] disappear. They're now in China. Okay?
[29:36] So, blue-collar work
[29:38] doesn't exist in the United States
[29:40] anymore.
[29:41] And I've talked about this before, guys,
[29:42] but something that we have a a huge
[29:44] issue in in the United States
[29:46] is what is called elite overproduction.
[29:49] Okay? This actually comes from a book. I
[29:51] highly recommend it. It's called The End
[29:54] Times by Peter Turchin.
[29:56] And he predicted that the United States
[29:59] would go through some form of empire
[30:01] collapse. And his two core KPIs to
[30:04] recognize this trend was one real wage
[30:07] growth. So, not wage growth, not your
[30:10] salary growth in dollar terms, but in
[30:12] real terms.
[30:13] How much groceries, vacation, housing,
[30:16] family is wages getting Americans?
[30:20] And as real wage growth declines, you
[30:23] get a really disgruntled, unhappy, and
[30:25] eventually revolution revolutionary
[30:27] population.
[30:29] People start marching, protesting,
[30:31] assassinating, etc. as real wages
[30:34] decline. That's historically been fairly
[30:37] true.
[30:38] The other is what he calls elite
[30:40] overproduction. Really interesting
[30:43] concept. And, you know, I'm going to try
[30:46] and simplify his idea, but again, I
[30:47] encourage you to read the book.
[30:49] His idea is that
[30:52] if everyone feels like they need to be a
[30:56] high-flying tech executive or a Wall
[30:58] Street trader or a super, super, duper
[31:01] smart and cool venture capitalist, that
[31:03] means everybody feels like they need a
[31:04] college degree. Everyone feels like they
[31:07] need the high-flying internship.
[31:08] Everybody feels like they need to be
[31:10] living in Manhattan or in Silicon
[31:12] Valley. He calls this concept elite
[31:15] overproduction. And when there is elite
[31:18] overproduction, that means there's too
[31:20] many people that are trying to strive
[31:22] for elite status with not enough
[31:24] opportunities to fulfill them. And so,
[31:26] you end up getting a
[31:28] university-educated,
[31:30] well-articulated, well-coordinated young
[31:33] group of people that are swimming in
[31:35] debt
[31:36] and have no job opportunities. And these
[31:39] are the people that typically are
[31:41] revolutionaries. These are the people
[31:43] that coordinate
[31:45] often times political violence. It's
[31:47] very interesting how he goes through it
[31:49] in the book, and I would wage to say
[31:50] we're kind of seeing that today, right?
[31:53] There are very smart, capable people
[31:56] that are very well-articulate and
[31:57] coordinated
[31:59] that are turning into revolutionaries.
[32:01] Or, you can see this in the socialist
[32:03] movement that are basically saying
[32:05] [ __ ] property rights.
[32:07] I went I got sw- I'm up to my eyeballs
[32:10] in debt. I've done everything I was told
[32:12] to do, and now you're telling me robots
[32:14] have taken my job? [ __ ] this. Whatever
[32:17] Elon Musk has earned, split it with me.
[32:19] [ __ ] property rights.
[32:22] Anyways,
[32:24] I digress. The point is,
[32:28] you have a country
[32:30] that has no blue-collar jobs. You have a
[32:33] country that has no middle class. Okay?
[32:37] The These things wouldn't be a problem
[32:39] if not everyone needed to be a tech CEO
[32:42] to make it out well in life.
[32:44] Work in a factory. Mine critical
[32:46] minerals. Go find rare earth somewhere
[32:49] so that Trump can shut the [ __ ] up.
[32:52] You don't need to be a high-flying VC.
[32:55] You don't need to be an AI engineer. You
[32:57] don't need to be a Wall Street
[32:59] investment banker.
[33:00] But no.
[33:02] The middle of America's utterly and
[33:04] completely destroyed. You can't make a
[33:05] living without getting a college degree.
[33:09] The number of asset holders without a
[33:12] college degree is like near zero.
[33:16] Okay?
[33:17] So Larry Fink's point is
[33:19] what happens when AI does the same to
[33:22] white-collar as what globalization did
[33:25] to blue-collar.
[33:27] What happens when AI in Anthropic takes
[33:31] everyone's software job, takes
[33:32] everyone's legal job, takes everyone's
[33:35] accounting and finance job? What happens
[33:37] then?
[33:40] Cuz you guys think things are bad now
[33:42] where there's no blue-collar work and
[33:43] there's no manual labor work and
[33:46] everyone has to get a degree and fight
[33:47] with each other for the most elite
[33:49] positions in the country and when you
[33:51] don't get them, you want to go kill
[33:53] someone, you want to riot, you want to
[33:54] protest, you want to take people's
[33:56] property?
[33:58] Wait until the white-collar jobs start
[34:01] going bye-bye.
[34:04] So here I have consumer credit.
[34:07] So consumer debt service payments as a
[34:08] percentage of disposable income.
[34:11] This thing is about to go to the moon.
[34:13] Cuz here's the problem, guys.
[34:15] Deflationary technology does not work in
[34:19] a monetary system that relies on
[34:21] inflation.
[34:22] It doesn't work on a debt-based system.
[34:24] Everybody has a mortgage, has a credit
[34:26] card, has a car loan.
[34:28] The world works on debt, has student
[34:30] loans. The current financial system
[34:32] works on debt. It works on the
[34:33] expectations of inflation. If it meets
[34:36] something like deflation, like AI,
[34:39] it runs into a lot of problems.
[34:41] Okay? So, what's going to happen when
[34:44] the guy that's a lawyer and makes a lot
[34:46] of money, so he has a million-dollar
[34:48] mortgage, $20,000 credit card bill every
[34:50] single month, he's got a $50,000 car
[34:53] note on his on his Porsche. What happens
[34:55] when AI takes his job?
[34:58] Who's paying that debt?
[35:03] Uh-oh.
[35:06] And And for the record, I don't want to
[35:08] make this episode too bleak, but if
[35:10] you're interested, go Google
[35:13] suicide rates in the middle of America,
[35:15] in the Midwest, in the blue-collar
[35:17] country, in the Rust Belt. Go Google
[35:21] drug overdose, suicide rates. I mean, it
[35:24] got bad.
[35:25] When you're unemployed, you have no life
[35:27] purpose, that leads to divorce,
[35:29] that leads to relationship hardships,
[35:31] financial hardships, substance abuse,
[35:34] suicide.
[35:36] I mean, like, you come to the You come
[35:38] to this show,
[35:39] right? For no ads,
[35:42] no political bias, no corporate bias.
[35:44] You come to this show and you listen to
[35:45] me for the truth, right? Sorry, kids,
[35:47] close your ears. That's it. It's not
[35:50] looking good.
[35:51] It's looking bad. Okay? Now, we can fix
[35:55] it. We have Bitcoin. We have hope. But
[35:58] it's looking bad. And this tweet from
[36:00] Luke, so first of all, Jim Bianco says,
[36:03] "The Bitcoin carnage is accelerating. At
[36:05] the time he tweeted, it's now down 12%
[36:08] today. This is the fourth worst this
[36:10] decade. The other three times it
[36:12] performed as bad, something was, quote
[36:14] unquote, breaking." And he cites COVID,
[36:16] he cites the FTX debacle. Um what else
[36:19] did we have? Silicon Valley Bank. I'm
[36:21] sure that was a really bad day. Okay?
[36:24] Luke adds the commentary, "Anthropic
[36:26] just told us that white-collar
[36:28] unemployment may soon be driven to
[36:29] levels that would make this whole system
[36:31] go boom. 6 to 7% unemployment ought to
[36:34] be more than enough to light the fuse.
[36:37] So again, liquidity is tightening, it's
[36:40] deleveraging, tech is getting
[36:41] slaughtered, real things are getting
[36:44] repriced, and look out below.
[36:48] And the overwhelming point I have on
[36:50] this episode is yes, in the near term is
[36:52] it painful to, you know, be holding
[36:54] Bitcoin when it goes down 20%? Yeah, of
[36:56] course. And this is why you can never
[36:58] add too much leverage, you got to stay
[36:59] humble, you got to stack sats, you got
[37:01] to be in it for the long term. I've
[37:03] never met anyone that's a short-term
[37:05] winner in this game, ever, ever.
[37:08] Okay?
[37:09] But I think it's healthy. Get these
[37:12] tourists out of Bitcoin. Get them out of
[37:14] here. If you're not owning Bitcoin for
[37:16] the right reasons to monetize it as a
[37:18] hard asset, and you're a highly
[37:21] leveraged, high time preference tech
[37:23] software junkie, get out. Get out of our
[37:26] asset class.
[37:27] >> [laughter]
[37:30] >> So next chapter, liquidity is rotating
[37:32] into the, quote, real, end quote,
[37:35] economy, okay?
[37:37] So from Bloomberg, Trump to launch $12
[37:39] billion critical mineral stockpile to
[37:41] blunt the reliance on China. From The
[37:44] Hill, Vance pushes for price floors on
[37:47] mineral trading.
[37:49] Uh the point is, and I I again, a bit
[37:52] rhetorical, but I I I think uh or or a
[37:54] bit repetitive, excuse me, but I think
[37:56] and rhetorical, I guess. Um but I think
[37:58] important. Capital is being redirected
[38:01] to what they're calling the real
[38:02] economy, real assets, real stuff.
[38:05] Reshoring domestic infrastructural
[38:07] domestic infrastructure, industrial
[38:09] base, and defense base. Less financial
[38:11] engineering, so less of these frothy
[38:14] multiples, all these paper contracts.
[38:16] Remember when I said silver is really
[38:19] this silver and gold was like one of the
[38:21] largest margin calls I've ever seen cuz
[38:23] there were more paper contracts than
[38:25] real assets. And the problem was you
[38:28] can't build AI infrastructure with a
[38:31] paper futures contract. You or with a
[38:34] paper silver contract. You you need the
[38:36] actual silver bar.
[38:39] And so when the world realized like oh
[38:40] [ __ ] I have all these silver futures,
[38:42] but I need the actual silver. I need to
[38:44] physically settle.
[38:46] It was like oh boy, there isn't enough
[38:48] silver to physically settle all this
[38:50] paper. So enough of the financial
[38:52] engineering paper games.
[38:54] Reprice physical reality, okay? Stock
[38:57] buybacks are dead. 50 to 100 times
[39:00] multiple is dead, okay? The world is
[39:02] being repriced in real time. This is a
[39:05] very very very different liquidity
[39:07] regime than the 2010s, okay? Very
[39:10] different. It's very important we
[39:12] understand that. This is a visual that
[39:14] just shows the era of tech buybacks is
[39:17] dead. This is a huge deal. These are the
[39:19] biggest companies in the world, their
[39:21] multiples are actively compressing in
[39:23] real time as I talk to you. That
[39:25] liquidity is trying to find hard assets,
[39:28] real things. Places to save wealth.
[39:32] Okay?
[39:33] Even the best look cheap.
[39:36] Okay, Microsoft, one of the best biggest
[39:38] companies in the world, it's down 20%
[39:41] over the last 6 months.
[39:43] Microsoft is getting hammered. It's like
[39:46] a shitcoin.
[39:47] This is insane and it's not because
[39:50] they're missing earnings, it's not
[39:51] because they lost profitability, none of
[39:54] those reasons.
[39:55] It's for all the reasons we've talked
[39:56] about in the episode. Okay?
[40:00] So the next chapter, Bitcoin's
[40:01] misclassification will not last forever.
[40:04] So this is short-term pain and it's
[40:06] necessary. All of us Bitcoiners knew in
[40:10] the back of our mind at some point we
[40:12] were going to have to grow out of this
[40:14] relationship that we have with tech.
[40:16] Bitcoin's always moving with tech. It's
[40:18] not like gold yet. It isn't traded like
[40:21] gold yet. And that's goes down to the
[40:22] people that own it. That's why. We just
[40:25] shake these people out. These tourists
[40:27] need to get out of here, okay?
[40:30] And so Bitcoin traded like software
[40:32] because software owned it. Why Bitcoin
[40:34] got dragged down? Same investor base,
[40:37] same liquidity pools, same forced
[40:39] selling dynamics. When these guys were
[40:41] getting pinched, when they were
[40:42] deleveraging, when they were getting
[40:44] margin called, Bitcoin got hit. You can
[40:47] see it in all the correlation charts I
[40:48] showed earlier. The really important
[40:51] point that I feel like I don't need to
[40:52] say to this audience, but you know, it's
[40:54] worth repeating, Bitcoin doesn't need
[40:56] what companies need. That's a
[40:58] fascinating thing. Bitcoin doesn't need
[41:00] high margins. It doesn't need buybacks.
[41:02] It doesn't need earnings. It doesn't
[41:03] need higher capex. It's not a company.
[41:07] It's not a tech stock. It's crazy that I
[41:10] have to say this out loud, but clearly,
[41:13] Bitcoin is still misunderstood by the
[41:16] broader investment public. That's just a
[41:18] fact.
[41:19] And we can we now know this based on its
[41:22] recent performance in correlation to
[41:24] software.
[41:25] It's just a fact.
[41:28] So, this I mean, if anyone was
[41:31] questioning how early we were, we're so
[41:33] early that some of the largest capital
[41:35] pools in the world still don't
[41:37] understand what Bitcoin is.
[41:41] But this is a blessing in disguise is my
[41:43] point. You guys know, I'm an eternal
[41:45] eternal optimist. I think the human
[41:46] condition is being an optimist. Believe
[41:50] in the future, okay?
[41:52] Yes, this dip is painful. To me, it's a
[41:55] huge buy opportunity. I'm scraping
[41:57] assets I don't need. I'm buy buy buy buy
[42:00] buy. I'll get into that in a second.
[42:03] But I do hope that this is the
[42:05] beginning. Now, I'm not saying tomorrow
[42:07] Bitcoin's not going to trade like
[42:09] software.
[42:10] This is the beginning, hopefully, of us
[42:13] closing this chapter of trading like
[42:16] tech and beginning a new chapter of
[42:19] trading like a hard asset, like the only
[42:21] finite asset you can get your hands on,
[42:23] like the best money in mankind's
[42:26] history.
[42:27] It's my hope, okay? The pain is
[42:30] constructive. No pain, no gain. Okay?
[42:35] And we will see. So, checking in on
[42:37] Bitcoin.
[42:39] I know that
[42:40] dips and and, you know, brief bear
[42:42] markets or long bear whatever, it really
[42:45] kicks people's ass. It it gets hard. I
[42:47] know that. I've been in this game for a
[42:49] very long time.
[42:52] And uh I know from first-hand experience
[42:54] and just
[42:56] from my peers. So, I wanted to make a
[42:58] chapter, make a section of me walking
[43:00] through, just visually showing you guys
[43:02] some of the Bitcoin price charts I look
[43:04] at cuz I think the pain
[43:06] Here Here's what I need you guys to
[43:07] understand. I think we are not in the
[43:10] beginning innings of pain. I think we're
[43:12] in the latter half of the pain. I'm not
[43:15] saying that that was the bottom. I'm not
[43:16] saying we're going 100k. These things
[43:19] take time. That's okay, okay? That's
[43:22] okay.
[43:23] We're going to Look, we can do it. We're
[43:25] going to be fine. Okay?
[43:28] This is all healthy. It's all good. We
[43:30] had to wash out these tech bros at some
[43:32] point.
[43:33] I'm glad it's now than later, okay?
[43:37] But I wanted to walk you guys through
[43:38] just visually why I think, according to
[43:41] data, we're closer to the end of this
[43:45] pain than you think. So, first of all,
[43:47] the classic cartoon, the stay humble
[43:49] cartoon. Now, stay humble is usually
[43:52] when the price is way high. What's the
[43:53] opposite of stay humble? Stay convicted.
[43:56] But my point is, you know, look yourself
[43:57] in the mirror and remind yourself, why
[44:00] are you in Bitcoin? What gave you
[44:02] conviction in the first place? Cuz I'll
[44:03] tell you guys this, the price dropping
[44:06] didn't change that there's going to be a
[44:07] block every 10 minutes on average,
[44:09] didn't change the monetary policy,
[44:11] didn't change the monetary properties.
[44:13] Nothing has changed, okay? This is why
[44:15] you have to not use too much leverage,
[44:18] not exceed your means, earn more than
[44:20] you spend, okay?
[44:23] Be responsible, be humble, always be
[44:26] stacking. Here's another thing.
[44:29] If you wanted to sell,
[44:31] now obviously hindsight's 20/20,
[44:33] should have done it, you know, but don't
[44:35] do it now is my point. At least, you
[44:38] know, obviously do what you need to do,
[44:39] but uh
[44:40] I would advise against it. Okay, so now
[44:42] let's look at some charts and reinforce
[44:44] what I think like
[44:46] I think this is very healthy. Think this
[44:47] is a good thing. Better now than later.
[44:50] We had to go through this at some point.
[44:52] Let's go The only way out is through,
[44:54] baby. So, the first chart, nothing more
[44:56] than a healthy correction. So, if you
[44:58] just zoom out a little bit,
[45:00] the chart looks great.
[45:02] Um we made new all-time highs that we
[45:04] had previously set during the COVID era.
[45:07] We went up to 125,000.
[45:09] We're coming back down, finding some
[45:11] support and accumulation back around
[45:14] those all-time high levels between this
[45:16] 60 and 70,000 dollar number.
[45:19] And I think we're going to be primed to
[45:22] make more all-time highs. The chart
[45:24] looks really healthy.
[45:26] Some more just chart porn, some data for
[45:31] your eyes. This is the longest oversold
[45:34] since weekly RSI peak in Bitcoin's
[45:37] history, okay? So, Bitcoin has now been
[45:40] oversold for 100 bars.
[45:43] So,
[45:44] what I'll show you guys from here on out
[45:46] is why I think this is not the beginning
[45:48] of a bear market. As I've said before, I
[45:51] think Bitcoin's not been in a bull
[45:53] market for quite some time because I
[45:55] look at it measured in gold, not in
[45:57] dollars. Dollars distort your reality
[46:00] because they're printed out of thin air.
[46:02] So, it really messes with how you view
[46:05] the world. How much is an egg really
[46:06] worth? How much is a house really worth?
[46:08] It's really hard when everything's
[46:09] measured in dollars. It's like wearing
[46:11] drunk goggles. Okay, so
[46:13] I don't think Bitcoin has been in a bull
[46:15] market recently. It's been trending down
[46:17] against gold. If anything, I think we're
[46:20] in the
[46:21] you know, back half innings of a bear
[46:24] market. I think the pain will subside
[46:26] soon. How do I know that? Well, let's
[46:28] look at this one.
[46:31] BTC percent of the supply in profit.
[46:34] Only 50% of active Bitcoins are in
[46:36] profit. That is insane.
[46:40] Bitcoin's at 70,000 and only half of
[46:42] Bitcoins owned are in profit. And by the
[46:45] way, if you look at this chart, in 2015,
[46:49] Bitcoin found a bottom when a little
[46:51] under 40% was in profit. Then,
[46:55] a little above 40% it found a bottom in
[46:57] 2019. And then in 2023, a little under
[47:01] 50%. Now, it's a little over 50%. And
[47:04] you have to ask yourself, okay, does
[47:06] that logically make sense? I actually
[47:07] think it's fascinating. Yes, every time
[47:10] Bitcoin finds a bottom, it should be a
[47:12] little bit higher in percent supply in
[47:14] profit than the last time. Why? Because
[47:17] what is happening? Tourists are getting
[47:18] shaken out. People here for high time
[47:20] preference and for the wrong reasons are
[47:22] getting shaken out. Eventually, over
[47:24] time, you build a really, really strong
[47:27] base of people that are monetizing
[47:29] Bitcoin and saving in it with no
[47:31] intention to ever sell, to capitalize
[47:33] their family, to capitalize their
[47:34] business, to capitalize their life.
[47:36] Right? And so, every single time Bitcoin
[47:38] finds a bottom, it's slightly less
[47:41] percent supply in profit than last time
[47:43] because the capital base under it has
[47:46] gotten stronger. Okay, so the first
[47:48] bottom Bitcoin found in 2015
[47:51] was a little under 40%. The next bottom
[47:53] in 2019 is 40%. The next bottom in 2023
[47:56] is a little under 50%. Now we're
[47:58] approaching 50%. So if you're to say, is
[48:01] this the beginning of the bear market?
[48:02] Are we in for a lot more pain? Listen, I
[48:04] don't know what the bottom is going to
[48:06] be. Could we get another wick down into
[48:07] the 50K's into the 40K's? Sure, I have
[48:10] no idea. Okay, I have no idea how much
[48:11] leverage is in the system. I have no
[48:13] idea who's about to blow up. Who knows?
[48:15] But, are we at the tail end of the bear
[48:18] market? Yes.
[48:20] According to data, yes. Hang in there.
[48:22] Hang in there. Hey, you're okay. You're
[48:26] going to be okay, guys.
[48:28] I mean, the the sentiment online is
[48:30] insane. We're going to be okay. Okay,
[48:33] the capitulation has already begun. This
[48:35] I I am a subscriber to Checkmate stuff.
[48:38] Highly recommend it. This tweet from
[48:40] him, net profit and loss broken down by
[48:43] year of coin acquisition. The class of
[48:44] 2025 and 2026 have collectively puked
[48:48] out 1.5 billion dollars a day in losses
[48:51] on the move lower. That's the equivalent
[48:54] to June 2022,
[48:56] which is FTX days. That's That's the
[48:58] $17,000 per Bitcoin. Capitulation has
[49:02] begun. We are in the thick of it. We are
[49:06] in the eye of the storm, baby. This is
[49:08] where the money is made. No pain, no
[49:11] gain.
[49:12] You better stiffen up that upper lip,
[49:15] [ __ ] Okay, you're going to
[49:17] survive. You're going to be okay. You
[49:18] want to come to the show and get a
[49:19] little bit of optimism and get a pep
[49:21] talk?
[49:22] Man up. Man up. You're okay. Okay? We're
[49:27] not in for another 2 years of pain.
[49:30] We're almost to the other side of it.
[49:31] Brace up. We're washing out the tech
[49:33] bros. Liquidity is rotating. Bitcoin's
[49:36] the scarcest thing you can get your head
[49:38] hands on. This thing's going to reprice
[49:40] higher. Clinch those cheeks.
[49:44] >> [laughter]
[49:44] >> You're going to be okay. Okay. The Mayer
[49:48] Multiple. The Mayer Multiple just takes
[49:49] Bitcoin's price over the 200 day. Okay?
[49:52] So it's just trying to find how is
[49:54] Bitcoin's price performing against the
[49:56] trend, okay? The Mayer multiple is
[49:59] approaching deep value, okay? Look at
[50:02] the bottom there, as low as these things
[50:04] have gotten when they found bottoms. We
[50:06] are approaching deep, deep, deep value.
[50:09] Meaning, can Bitcoin go lower? Sure.
[50:12] Can Bitcoin have already bottomed? Yes.
[50:15] Yes.
[50:17] This is the time to turn on your DCAs.
[50:19] This is the time to convert your
[50:21] paycheck into Bitcoin. This is the time
[50:23] to get some exposure. This is not the
[50:25] time to lose conviction. This is not the
[50:28] time And listen, do what you want,
[50:30] right? I already know the Twitter
[50:31] clippers are going to clip this, but
[50:33] Jack's begging people to buy his bags.
[50:36] Do whatever you want, okay?
[50:38] Friend to friend, Bitcoiner to
[50:40] Bitcoiner, man to man, man to woman,
[50:42] woman to man, okay?
[50:44] I'm just trying to help you out.
[50:46] We are in the end innings. You're going
[50:49] to survive. The worst may be over, and
[50:52] if there's worse from here, it's not
[50:54] going to last much longer. We're living
[50:56] through the capitulation. We're in the
[50:58] deep value. The Bitcoin percentage in
[50:59] profit is at levels that makes a bottom.
[51:03] We're almost there. Sometimes it's
[51:05] really that simple. Look at the moving
[51:07] average in the Bitcoin price. We have
[51:09] entered a zone where it is historically
[51:12] really valuable to buy.
[51:16] It's like it's sometimes it's that
[51:17] simple. You've only had in the last you
[51:20] know, decade or so, you've only had
[51:22] three other opportunities to acquire at
[51:24] this relative price.
[51:27] And look at you know, sometimes Bitcoin
[51:29] hangs around here, under here for a
[51:31] while, and sometimes it sharply
[51:34] recovers, okay? The the 2021 is what I
[51:37] want you guys look at. That was COVID.
[51:40] Bitcoin dropped 50% in a day. Everyone's
[51:43] panicking. Everyone's selling. Bitcoin's
[51:44] going to zero. Blah, blah, blah, blah,
[51:46] blah. And then it went from $3,000 per
[51:49] Bitcoin to $70,000 per Bitcoin in like a
[51:52] year.
[51:53] So,
[51:55] turn the DCA on. Here, here's the thing.
[51:57] Here's what you guys need to decide for
[51:59] for all the people that are emotionally
[52:01] damaged. And by the way, I'm not saying
[52:03] that this is easy. When the next time
[52:05] people say, "Oh, you just got lucky."
[52:08] This reminds me of like when all the
[52:09] people from my hometown or all the
[52:11] people that aren't in the industry say,
[52:13] "Oh, yeah, you just got lucky." I just
[52:15] got lucky. Do you have any idea how hard
[52:18] it is to hold something from $50 per
[52:21] coin to $125,000 per coin and not
[52:24] [ __ ] touch it? Do you know how hard
[52:26] it is to have an asset go down 80% plus
[52:30] over and over and over again? And for
[52:32] the smartest, most credible people in
[52:34] the world, for the world's politicians,
[52:35] for everyone that you're supposed to
[52:37] trust, you're supposed to learn from,
[52:38] you're supposed to care about, everyone
[52:40] saying, "You're an idiot. You're wrong.
[52:42] You're stupid. You're poor."
[52:44] And not listen to them.
[52:46] Do you know how hard that is? So, the
[52:48] next time, in a year from now, when
[52:50] Bitcoin's at 200k, and someone says,
[52:52] "Oh, you just got lucky."
[52:54] [ __ ] you. [ __ ] you.
[52:57] These are the times you earn it, okay?
[52:59] These are the times you earn it. Double
[53:02] down on that conviction. No fee, no
[53:05] spread, DCA, paycheck conversions on
[53:08] Strike.
[53:09] Start getting yourself some corn. Hang
[53:12] in there, okay?
[53:14] And the last chapter I have for you guys
[53:16] is that all the clues are right in front
[53:17] of us. So,
[53:19] is this going to be a multi-year bear
[53:20] market? Again, according to the data,
[53:23] everything that I check on when we get
[53:24] into bear markets, I guys I've been in
[53:26] this game for a long time. I've been in
[53:27] this game for well over a decade, okay?
[53:30] I check the same KPIs. I check the same
[53:33] things to get a pulse on the market, to
[53:35] see how we're doing, okay?
[53:38] According to what I look at,
[53:41] we're in the bottom 20% 10% maybe 5% of
[53:46] the back half of the bear market. It
[53:47] it's
[53:49] there's not that much pain left. Now,
[53:52] how fast are we going to go up? When's
[53:54] the new all-time high? I don't know, of
[53:56] course. I can't know that. Anyone that
[53:58] tells you they know that is a [ __ ]
[54:00] liar. They're selling you something,
[54:01] okay? But,
[54:04] what I can tell you is the clues in
[54:05] front of us are apparent. You just have
[54:07] to open your eyes. So, this chapter is
[54:09] called all the clues are right in front
[54:11] of us. Okay. Bloomberg, this is very
[54:14] sneaky. This didn't catch a lot of
[54:16] Bitcoiners eyeballs for some weird
[54:18] reason. I couldn't believe it. You know,
[54:20] you've got Anthropic and AI and the
[54:22] Super Bowl and Bad Bunny in the halftime
[54:25] show. Woo! All the [ __ ] okay? Bloomberg
[54:29] came out with an article, "Warsh call
[54:31] for Fed Treasury accord stirs debate in
[54:34] $30 trillion bond market."
[54:36] Okay, I'm going to skip to the bottom of
[54:37] this article and read, "Looming over any
[54:40] Fed Treasury talks would be Trump, who
[54:43] last year argued that one of the central
[54:44] bank's duties in setting interest rates
[54:47] is to mind the government's debt costs.
[54:50] Those are currently running at an annual
[54:51] clip of a trillion dollars a year or
[54:53] half the budget deficit."
[54:56] Quote, "Rather than ins- insulating the
[54:59] Fed, it could look more like a framework
[55:02] for yield curve control." Tim Duy, chief
[55:06] US economist of SGH Macro Advisors, said
[55:09] of an accord, "A public agreement that
[55:11] synchronizes the Fed's balance sheet
[55:14] with the Treasury financing explicitly
[55:16] ties monetary operations to deficits."
[55:20] Guys,
[55:21] the clues are right in front of you. You
[55:24] just have to be paying attention.
[55:27] Bloomberg and Warsh and the chief US
[55:31] economist of Macro Advisors is telling
[55:35] you they're planning yield curve
[55:37] control, which by the way, let me let me
[55:39] put that in layman's terms.
[55:42] That means the Fed is going to print
[55:44] dollars out of thin air to buy US
[55:46] Treasuries, which is another way of
[55:48] saying the Fed is going to print dollars
[55:50] out of thin air to lend to the US
[55:53] government, which is another way of
[55:54] saying the United States is going to
[55:56] print money out of thin air.
[55:59] Highly inflationary, highly good for
[56:01] things like gold and Bitcoin.
[56:03] Like
[56:05] The clues are right in front of us.
[56:08] Remember, Warsh is a politician. Do not
[56:11] believe for a second he's anything other
[56:14] than that. Trump jokes about suing Warsh
[56:17] if he doesn't lower rates. So, what have
[56:19] we read since this guy got nominated?
[56:22] Trump is going to sue him to oblivion if
[56:25] he doesn't listen, and that he is a
[56:28] Bassant disciple, a Stanley
[56:30] Druckenmiller disciple, and they're
[56:32] planning some type of relationship with
[56:34] Treasury to cap
[56:37] rates on
[56:39] Treasuries and implement some form of
[56:41] yield curve control.
[56:43] The clues are
[56:45] are right in front of you, okay? Right
[56:48] in front of us.
[56:50] Hang in there. Hang in there. Get these
[56:53] tech software leveraged Wall Street
[56:56] junkies out of our asset class. Buy
[56:58] their dip. If Bitcoin is capitalized and
[57:02] held by hodlers of last resort, people
[57:05] that are monetizing it, that are saving
[57:07] in it, it will start trading like a hard
[57:09] asset. It's never made sense that it
[57:11] traded like a tech stock. It's cuz a lot
[57:13] of these tech guys got into it over the
[57:15] 2010s in these large swaths of
[57:17] liquidity, and now that there's a
[57:19] liquidity regime change, a lot of that's
[57:21] unwinding. Hang in there. Turn on your
[57:26] DCAs.
[57:28] We are almost home. We are almost home.
[57:32] Okay, Uh company updates.
[57:35] Um,
[57:36] these slides were misplaced, but I also
[57:38] wanted to put this in the closer right
[57:40] in front of our face. Uh, the gig is up.
[57:43] China is dumping treasuries and loading
[57:45] up on gold. And then look at this press
[57:46] release, by the way.
[57:48] Uh, China urges its banks to curb US
[57:50] Treasury exposure on market risk.
[57:52] Chinese regulators have advised
[57:53] financial institutions to rein in their
[57:55] holdings of US Treasuries citing
[57:56] concerns over concentration risk and
[57:59] market volatility.
[58:00] Like, it's getting real. China's
[58:02] literally telling their banks like, "Yo,
[58:04] be careful with these Treasury things."
[58:06] Like,
[58:07] things are changing fast. Like, do not
[58:09] own that dog [ __ ]
[58:11] >> [laughter]
[58:12] >> Meanwhile, the guy who's about to lead
[58:15] the Central Bank
[58:16] of the Fed is saying, "Yeah, these
[58:19] Treasuries are so bad, it might make
[58:20] sense that we implement a public policy
[58:23] where we print out a print money out of
[58:24] thin air to cap the yields
[58:27] so that things don't go haywire."
[58:32] Oh, man. Buy the dip. All right, company
[58:35] updates. Uh, for those that care.
[58:38] I'll I'll try and breeze through Strike
[58:40] I'll try and breeze through them both,
[58:41] honestly, cuz there's a lot in here.
[58:43] Okay, Strike, first and foremost, uh,
[58:45] we've updated our margin call policy.
[58:48] So, we can talk about lending and, you
[58:50] know, people on the internet have plenty
[58:52] of opinions about me, which is weird
[58:54] place to be in, but whatever. Um,
[58:57] we've updated the recovery window 72
[58:59] hours. So, previously, if you got a
[59:01] margin call, you needed to update your
[59:03] position within 24 hours. We've updated
[59:05] it to 72.
[59:07] And our recovery threshold was
[59:09] previously 60% LTV. It's now 65% LTV.
[59:12] And I just want to say something.
[59:14] Um,
[59:17] that Thursday was like utter and
[59:19] complete chaos, okay? Markets are moved
[59:22] like, there's no circuit breakers,
[59:23] markets don't close, there's no help
[59:26] from any central parties in Bitcoin.
[59:29] Free market, every man for himself.
[59:33] Um people can say what they want about
[59:36] me, about my companies.
[59:38] This is proof of work. This is showing
[59:41] the [ __ ] up. Okay?
[59:43] In the heat of the storm,
[59:46] eye of the tiger,
[59:50] we were listening to customer feedback,
[59:51] observing the market,
[59:54] and said, "How can we take on more risk
[59:57] as a business that we think is
[59:59] reasonable in an effort to help people
[60:00] out? In an effort to make our product
[60:02] better."
[60:03] And we did.
[60:06] I mean,
[60:08] the Strike team
[60:10] is just
[60:12] championship attitude right there.
[60:14] Never too high, never too low, we just
[60:17] get [ __ ] done.
[60:19] And so, I want you guys to know this as
[60:22] customers of the product cuz it benefits
[60:24] you tremendously.
[60:26] And I want to shout out my team.
[60:28] You know, working for me sometimes you
[60:30] take a lot of strays. It sucks. I don't
[60:33] know why that is.
[60:35] You know, at the more I've become a
[60:36] public figure,
[60:38] it's it's really weird to live through.
[60:41] Like people feel like they know you,
[60:43] people feel like they have a right to
[60:44] opine on your life and a right to know
[60:46] what's best for you.
[60:48] And they feel like they have a right to
[60:52] criticize you and judge you. And
[60:55] for some reason that sometimes extends
[60:58] to my business and my employees. And
[61:03] not only is all of that [ __ ] and
[61:05] ridiculous and obviously it's just the
[61:06] internet and you can't take it too
[61:08] seriously,
[61:09] but I mean [ __ ] like this, like the
[61:11] Strike team
[61:12] needs credit where credit's due.
[61:15] I mean,
[61:16] this is
[61:18] in my opinion, this is heroic [ __ ]
[61:22] This is This is a company built by
[61:25] Bitcoiners for Bitcoiners.
[61:27] That's what that looks like.
[61:29] Not what people say. A lot of other
[61:31] Bitcoin startups, their marketing
[61:33] campaign is trying to convince the world
[61:35] that I'm a bad guy, that I'm
[61:37] compromised, that I'm the devil. That's
[61:39] like how they attract people to use
[61:40] their product. Use us because that guy
[61:42] sucks.
[61:44] Okay?
[61:45] That's just a lot of talk. It's a lot of
[61:47] proof of stake. It's a lot of fiat.
[61:50] This is proof of work.
[61:51] And so, I want you guys to know, for
[61:54] those that use our product,
[61:56] but then I also want my employees to
[61:58] hear me say out loud what I think they
[61:59] deserve to hear,
[62:01] which is
[62:03] that is the culture of this business.
[62:06] Um very proud of my people.
[62:09] That is very cool.
[62:11] Very cool.
[62:14] Um more updates from Strike. Bitcoin
[62:16] back loans are now available in Texas,
[62:18] so we finally got Texas, one of the
[62:20] biggest markets for us. Sorry it took so
[62:22] long. They were iffy with the license.
[62:24] They were like dangling our our lending
[62:26] license in front of our face. And we
[62:28] finally got it. So, very excited about
[62:30] this. Um if you're in Texas and you're
[62:33] interested in a Bitcoin back loan, I
[62:35] think we're the best in the business.
[62:36] Pricing, just a recap of the product,
[62:39] you can have a monthly payment loan. You
[62:41] can also have payment at maturity, so
[62:42] you don't, you know, we just take the
[62:44] interest, we roll it into the principal,
[62:46] you owe us in a year. We've got our line
[62:48] of credit coming out in less than 2
[62:50] weeks. Well, it'll begin to roll out, so
[62:53] very proud of this. Looking forward to
[62:55] working with people in Texas, especially
[62:57] the miners out there. Um I think our uh
[62:59] line of credit product for miners could
[63:01] be really interesting. Alabama, we also
[63:03] got Alabama, so our Bitcoin back loans
[63:05] are available there.
[63:07] Uh we lowered our minimums
[63:09] for Indiana. So, Indiana, our minimums
[63:12] are now $10,000
[63:14] for a loan, which is incredibly
[63:16] exciting.
[63:17] Um
[63:18] what else do I have for you guys?
[63:21] Uh our like I said, our line of credit
[63:22] product will begin rolling out in a
[63:25] little less than 2 weeks, week and a
[63:27] half, uh which is very, very exciting.
[63:29] So, that product, just a reminder,
[63:32] um we give you a line of credit against
[63:34] your Bitcoin that acts as a payment
[63:36] method. So, when you go to buy Bitcoin,
[63:37] when you go to pay a bill, whatever you
[63:39] want to do on Strike, you can use the
[63:41] bank account you have attached, you can
[63:42] use your cash balance, you can also use
[63:45] a credit line against your Bitcoin. And
[63:47] so, that is for people that want to use
[63:49] this Bitcoin-backed loan type of
[63:51] product, but they don't want to take out
[63:55] a massive loan over a 12-month duration.
[63:57] Cuz I will say, one of the things I
[63:59] think is awkward about the product today
[64:02] is that to take out a loan against my
[64:03] Bitcoin, I have to borrow against
[64:07] my bit I have to borrow a large sum
[64:08] that's going to last me 12 months. And
[64:10] then what happens is people say, "Shit,
[64:12] it's only option is a 12-month term.
[64:15] Well, I have to borrow more than I
[64:16] actually need right now, and then I get
[64:18] worried about getting margin called, and
[64:20] what if the price goes down?" And so, we
[64:22] crafted a product like sometimes you do
[64:23] need a large loan. You're buying a
[64:25] house, you're financing your wedding,
[64:26] you're paying off large debt, you have a
[64:28] medical emergency. But sometimes you're
[64:30] just looking to pay your credit card
[64:31] bill, you're just looking to pay your
[64:33] rent, you're just looking to pay a
[64:34] really small expense,
[64:36] and you don't want to take out a massive
[64:38] 12-month loan. You just want to pay the
[64:40] bill. And so, the way, you know, I use
[64:43] it for example and and I would encourage
[64:45] others to use it is you have some
[64:46] Bitcoin on Strike,
[64:48] and when a bill comes in, your credit
[64:50] card, your HOA, your rent, whatever it
[64:52] is, your electricity bill,
[64:54] you hook up your Strike account where
[64:56] the line of credit handles the bill. So,
[64:58] the bill comes in, Strike extends a mini
[65:00] line of credit, pays the bill for you,
[65:02] and says, "Hey, we extended your line of
[65:04] credit $2,000 and paid your rent."
[65:07] And then, you're not you're not like,
[65:09] you know, taking out this massive loan
[65:10] against Bitcoin, and if Bitcoin hits a
[65:12] certain price level, you got to add more
[65:13] collateral. Then it's like, you know,
[65:15] these tiny little loans, and then as
[65:16] your paycheck comes into Strike, you can
[65:18] say, "Hey, I'll take half my paycheck,
[65:20] pay down my line of credit, the other
[65:21] half of my paycheck I'll stack some
[65:22] sats." And then you're kind of slowly
[65:24] managing. This is more for people that
[65:26] are living their life on top of Bitcoin
[65:28] and not using these products for like
[65:30] massive one-off expenses.
[65:33] So, very, very, very excited about that.
[65:35] And then we will continue to I mean,
[65:38] look at how many updates I had
[65:40] just in the last week. I mean, we expect
[65:42] New York very soon. Um so, we'll
[65:44] continue to roll things out um as we
[65:47] can, but the really, really big one I'm
[65:48] excited about is the line of credit. And
[65:51] then for 21,
[65:53] we continue to work on on the operating
[65:55] business. So, as I said,
[65:57] our goal is to um be able to produce
[66:01] cash flow with high margins and growth
[66:03] um in the Bitcoin industry and pair that
[66:05] with a large treasury. Um we think that
[66:08] that would be the most appetizing
[66:10] Bitcoin company in the public markets.
[66:12] And uh we're putting together,
[66:14] you know, the announcement and uh
[66:18] and what we will be ready to share in
[66:20] regards to the operating business. So,
[66:22] I I get it. Uh public markets have have
[66:25] been tough on me. It's I can only say so
[66:28] much with Strike. I can tell you guys
[66:29] whatever the [ __ ] I want. With 21,
[66:31] that's not true. Um and so,
[66:33] uh that is my update uh today.
[66:37] And uh now we got Q&A. So, a little over
[66:39] an hour for that episode. We'll keep Q&A
[66:43] whatever, 10 15 minutes maybe,
[66:44] hopefully. Um but that was a fun one.
[66:47] Hopefully you guys learned a lot about
[66:49] Bitcoin, its correlation to tech,
[66:51] hopefully it's ending. And you got a
[66:52] little conviction that
[66:54] that the pain isn't forever. You're
[66:56] going to be okay. Hang in there. This is
[66:58] my
[66:59] what, fourth, fifth
[67:01] quote-unquote bear market?
[67:03] Um you're going to survive. You're okay.
[67:05] Buy the dip.
[67:06] Buy the dip. All right.
[67:09] Let me blow up
[67:11] my screen.
[67:12] There he is.
[67:15] Little scruff.
[67:16] Look at those blue eyes, man.
[67:20] Eyes so blue.
[67:21] Wow.
[67:26] Bluer than the sky.
[67:29] Um
[67:31] All right. Let me pull up Dylan's
[67:33] questions.
[67:39] Okay, Q&A.
[67:41] Uh macro questions to start. Could you
[67:43] please explain how institutions like
[67:45] BlackRock sells their BTC ETF and
[67:47] there's no impact on the price? Are we
[67:49] dealing with paper Bitcoin price
[67:51] manipulation? It appears to me.
[67:53] I don't think so.
[67:55] Um
[67:56] so I do think that these derivative
[67:58] products amplify Bitcoin moves, but both
[68:01] to the downside and the upside.
[68:04] I think that these paper products create
[68:08] um leverage at the end of the day. You
[68:10] got options, you got futures. It allows
[68:13] people to get exposure without the
[68:15] physical.
[68:16] And so I do think
[68:18] that it's an amplifier to price
[68:20] movements.
[68:22] And so
[68:24] I do think that
[68:26] these products amplify the price
[68:29] movement downwards, for sure.
[68:31] But I also think that when Bitcoin rips
[68:34] to the upside, it will amplify the price
[68:37] movement upwards as well. So I think
[68:40] that they are price amplifiers.
[68:42] They allow more liquidity to be a part
[68:45] of price discovery.
[68:47] But I do not think that the Bitcoin
[68:49] price is being manipulated. I I think I
[68:51] may have a very clear
[68:53] case that I think the Bitcoin price
[68:57] is falling, unfortunately, in this like
[69:00] software tech unwind.
[69:04] Which is kind of funny because it's it's
[69:06] it's a hard money asset. But obviously,
[69:09] I mean, you know, 16 years ago it was
[69:12] zero and we were mining the first block.
[69:15] And now
[69:17] it's one of the largest asset classes in
[69:19] the world and it's going to have to
[69:20] continue to flush out people that
[69:22] misunderstand it, have the wrong time
[69:24] preference, don't have the right
[69:25] conviction. It's done this time and time
[69:27] and time again. It's flushed out big
[69:29] blockers, it's flushed out shitcoiners,
[69:31] it's now flushing out tech software
[69:33] investors. And inevitably and eventually
[69:37] it will be capitalized and monetized by
[69:39] people that are treating it and saving
[69:40] it as money.
[69:42] And I think it's just living through one
[69:43] of those chapters. The more financial
[69:45] instruments we have, the more
[69:47] amplification to price movements.
[69:50] But that's okay. That's what we want. We
[69:52] want it to be highly liquid, highly
[69:54] sellable. That's a a monetary property
[69:56] that we seek out.
[69:58] So and and to be
[69:59] uh quick here, but I can expand on it if
[70:02] you guys want.
[70:03] I've always fundamentally believed
[70:05] Bitcoin's far harder
[70:07] to manipulate than something like gold
[70:10] because the only way to use gold is to
[70:12] deposit it with a government, with a
[70:13] bank, with an institution because you
[70:15] can't send gold over the internet, I
[70:17] can't send it across borders, I can't
[70:19] pay for my Uber Eats with gold, I can't
[70:21] do [ __ ] with it unless I physically walk
[70:23] it or fly it or sail it where I need to
[70:25] go.
[70:27] And so gold was always highly highly
[70:29] highly concentrated not only in
[70:31] ownership but physical custodianship.
[70:35] Bitcoin, that's not the case.
[70:37] Bitcoin is distributed fairly via proof
[70:40] of work to the people.
[70:42] And so it's very difficult to manipulate
[70:44] Bitcoin because
[70:46] we we see on Twitter all the time
[70:48] all-time low of supply on exchanges,
[70:50] all-time low of supply on exchanges and
[70:52] all of these derivative products are
[70:53] tied to the physical spot price of the
[70:56] asset.
[70:57] And so if there's an all-time low on
[70:58] some random exchange, some some random
[71:01] overseas shitty exchange, but Bitcoin
[71:03] over there goes to 150,000, well, guess
[71:06] what? The CME futures is going to have a
[71:09] really tough time staying at 70,000.
[71:11] Um
[71:13] and, you know,
[71:14] at the in if peop- people are going to,
[71:16] you know, withdraw their coins and then
[71:18] and then the gig is up. So, it it's
[71:19] going to be a lot more difficult to
[71:21] control Bitcoin than people think. I
[71:23] think people are just frustrated and
[71:25] they want Bitcoin to go up and they want
[71:26] someone to blame.
[71:28] And I think this is
[71:29] healthy, natural. Wash them out.
[71:32] The convicted stay, the strong remain.
[71:35] We're a better asset for it. We move on.
[71:38] Question, if AI drives deep deflation
[71:41] and job losses, does liquidity dry up
[71:43] and hit Bitcoin first or does massive
[71:45] debt force more printing that ultimately
[71:48] boost Bitcoin, short versus long-term?
[71:50] Probably both, right? So, yes, if
[71:52] there's a deep deflationary
[71:55] wave,
[71:57] a lot of things are going to get
[71:58] absolutely crushed. If unemployment goes
[72:00] to 6 to 7%, there's a lot of
[72:02] delinquencies on consumer debt, consumer
[72:05] debt as a percentage of income goes
[72:06] through the roof,
[72:08] then yeah, like a lot is going to get
[72:11] crushed. And the bond market also So,
[72:15] the yield on the bonds, so we talk about
[72:17] yield curve control,
[72:19] the 10-year's going to go through the
[72:20] roof, too, yield, because
[72:23] you know, a lot of the United States
[72:25] receipts, their revenue, comes from
[72:28] taxes. And so if all of a sudden
[72:30] everyone's unemployed because robots and
[72:33] AI models took their job, well, then AI
[72:36] models aren't paying capital gains and
[72:39] income tax.
[72:41] And so then the market will also be
[72:44] like, "Fuck, the US is even more broke
[72:46] than it was because it doesn't even have
[72:49] revenue to offset the massive amount of
[72:51] deficits that are growing, Trump wants
[72:54] to spend more on defense, more on
[72:56] critical minerals, more on rare earths.
[72:59] And so, yes, if that happens, it'll be a
[73:03] massive gut punch to markets, but that's
[73:06] when they print the money. So, again,
[73:09] you know, you have to ask yourself some
[73:11] fundamental things. One, do you think
[73:13] that the system is going to fail via
[73:15] austerity and outright collapse, or it's
[73:17] going to fail via inflation and default
[73:20] through debasement? You have to give You
[73:23] have to answer that for yourself, right?
[73:25] Do you think that the United States is
[73:27] going to let everything collapse on
[73:28] itself and we grow go through a great
[73:30] great great great great depression? Or
[73:32] do you think they're going to continue
[73:33] to print the money? Cuz then
[73:34] everything's short-term. You know,
[73:36] long-term would be austerity. Everything
[73:38] would would have would be pain, and then
[73:40] on the other side of that, Bitcoin will
[73:42] still win, cuz at the end of the day,
[73:44] it's competing to be money, period.
[73:46] Doesn't matter how long it takes and
[73:47] what it has to go through, it's Is it
[73:49] the better money than the other thing
[73:50] you're holding or not? Yes or no?
[73:52] And eventually, I believe it'll win that
[73:54] battle.
[73:55] The question is the path it has to walk
[73:57] to get there. And if history is is any
[74:00] teacher, we know they're going to print
[74:02] the money, and that we've been slowly
[74:03] defaulting via debasement, we've slowly
[74:05] been defaulting via inflation.
[74:07] And we know that Warsh is going to come
[74:09] in and cut rates and likely implement
[74:11] yield curve control and help these
[74:14] deflationary forces.
[74:16] We've I mean, if you listen to Bassin,
[74:17] if you listen to Warsh, if you listen to
[74:19] any of these guys, they're saying we
[74:21] have to grow our way out.
[74:23] AI is a huge Things like AI, they're big
[74:26] on Bitcoin.
[74:27] You know, we have to use hard
[74:30] appreciating assets, things that
[74:31] everyone owns. We have to use AI to grow
[74:35] our way out, GDP growth, but that's
[74:37] highly inflationary. That inflation is
[74:39] going to realize itself in the yields of
[74:42] the 10-year, right? As inflation goes
[74:44] up, people lending to the US government
[74:46] are going to want to get paid more.
[74:48] You got to if if the price of eggs and
[74:50] vacation and housing is going to go up,
[74:52] well, you got to compensate me for that
[74:54] if you want me to lend you money.
[74:56] And so, in order to cap the prices, cap
[74:58] the yields, they're going to do yield
[74:59] curve control.
[75:00] So, I think all of the above to answer
[75:03] your question, and that's why you got to
[75:06] be in it for the long term. You got to
[75:08] lower your time preference. You got to
[75:10] hang in there. Okay? You got to hang in
[75:12] there. That's my message.
[75:14] Don't exceed your means, okay? Live
[75:16] within your means, earn more than you
[75:18] spend.
[75:20] Lower your time preference, stay
[75:21] convicted, simplify.
[75:24] Hang in there.
[75:25] Okay?
[75:27] For every winner, there's a loser. Very
[75:29] I mean, the truth is, and this is very
[75:31] unfortunate, all of us are not going to
[75:33] make it out alive. All of us are not
[75:35] going to make it to the other side.
[75:37] Bitcoin's a fixed supply asset. Not
[75:39] everybody is going to get access to it
[75:41] at the same price. Your buddy that isn't
[75:44] listening to you is going to see the
[75:46] signs, see the light, and he's going to
[75:47] start stacking at $500,000 a coin. You
[75:50] just got to hang in there, hang tough.
[75:53] Thoughts on Japan uh rearming. They will
[75:56] likely prevent Taiwan take back, which
[75:58] will happen by 2030 likely. A World War
[76:02] run back? Question mark?
[76:04] Uh
[76:05] I I mean,
[76:07] just
[76:09] reading the research that I've read out
[76:12] of China,
[76:14] they don't want to fight.
[76:16] And for good reason.
[76:19] They're killing it.
[76:23] Pause.
[76:26] Twitter clippers, please don't clip that
[76:28] and quote me out of context.
[76:30] China's killing it. Here's how China's
[76:32] killing it. Listen, I don't think the
[76:34] CCP is a good thing. Think we should
[76:36] abolish the CCP.
[76:39] What do I mean? China right now, this is
[76:41] a fun fact that I learned reading
[76:43] research this weekend.
[76:44] China right now
[76:46] is graduating more engineers per year
[76:50] than the US has in total.
[76:53] Now, you could say, "Well, that's
[76:55] because their population is so much
[76:57] bigger." So what? Why does that matter?
[76:59] Sounds like we need to have more babies
[77:01] and focus on
[77:02] you know, studying the right topics.
[77:06] They're outproducing us in engineering.
[77:09] They're smarter than us on a lot of
[77:11] critical topics. They're way wealthier
[77:13] than us in critical minerals. And
[77:16] they're running now a trillion-dollar
[77:18] trade surplus annually and growing.
[77:21] So, what I'm reading out of China, they
[77:23] don't want to fight.
[77:28] They
[77:29] I don't envision a hot war.
[77:32] I don't I don't think that's on the
[77:33] cards.
[77:34] I think China is like,
[77:36] "We're not going to own treasuries.
[77:38] We're going to
[77:40] push the world into this new monetary
[77:42] regime. We're going to stack gold.
[77:47] But think about it, like
[77:49] the whole rare earth thing.
[77:51] China was very clear. They're saying,
[77:52] "We're going to stop giving you guys
[77:53] rare earths because you use those rare
[77:55] earths to create weapons to bomb us. And
[77:57] we're done with the fighting. We're done
[77:59] with the violence. We're not going to
[78:01] give you access to the materials to
[78:04] create the weapons to hurt everyone
[78:05] else.
[78:06] We're going to strip you from the
[78:08] ability to create more weapons and hurt
[78:10] more people.
[78:11] We're done with the fighting.
[78:14] Let's Let's do this with economic
[78:16] warfare, okay?
[78:17] You guys reshore.
[78:19] Surely that's going to cause a lot of
[78:21] inflation. Surely AI is going to be
[78:22] really disruptive to your inflationary
[78:24] economy. You're going to need yield
[78:25] curve control. You're going to go
[78:26] through a lot of political stability.
[78:27] You're going to go through your own
[78:28] fourth turning over there. We have our
[78:30] own problems. We have our own agenda.
[78:33] But we're going to, you know, we're all
[78:34] we're we're each going to focus on our
[78:36] own hemispheres.
[78:38] Whatever.
[78:39] China didn't react to the Venezuela. You
[78:40] all right. You guys got Venezuela. Fair
[78:42] game.
[78:43] They didn't
[78:44] They didn't react.
[78:46] So,
[78:47] that's This is not what I want or this
[78:49] is not my ideal.
[78:51] From the research I've read,
[78:53] no one's really interested in a hot war.
[78:55] So, I I don't expect a World War III and
[78:57] I pray we don't have one. I would much
[78:59] rather the the fight is over artificial
[79:01] intelligence. The fight is over critical
[79:04] minerals. The fight is over supply
[79:05] chains.
[79:07] This fight is over engineering.
[79:11] Right? The fight is over like That is
[79:14] what is going to be defining trade
[79:16] surpluses,
[79:18] defense industrial bases, manufacturing,
[79:21] whoever wins the AI race. Supposedly,
[79:24] that's a national security threat on
[79:25] both sides. I don't think it uh and I
[79:28] hope it doesn't involve like real
[79:30] missiles.
[79:32] Hey Jack, how much is Warsh foregoing QE
[79:35] in unexpected headwind? Will it
[79:38] meaningfully affect the liquidity that
[79:40] would uh be used to buy Bitcoin?
[79:43] I don't know. I don't think so. If you
[79:46] look at markets, nobody's pricing in
[79:48] like a tremendous amount of rate cuts. I
[79:50] I don't think anybody is expecting that
[79:52] of Warsh. In fact, everything's down
[79:54] tremendously since Warsh was nominated.
[79:56] The markets did not like that.
[79:59] Like
[80:00] according to the markets, Trump
[80:02] nominated the only hawk
[80:04] that was available. They're like, "Oh,
[80:05] you should have picked the BlackRock
[80:06] guy. Assets would have gone to the
[80:07] moon." But as I said before,
[80:11] these guys are politicians.
[80:13] Don't forget that.
[80:15] It's like So, we just watched everything
[80:18] Jerome Powell and Trump put us through.
[80:22] All the clownery, all the [ __ ] And
[80:25] then a new guy's going to step in and
[80:26] you guys aren't going to size them up as
[80:28] what we've been watching this whole
[80:30] time. You're like, "Oh, no, this guy's
[80:31] different. Who the [ __ ] are you kidding?
[80:34] Come on, guys. Wake up. This guy's a
[80:37] politician. He's going to print the
[80:38] money. He hasn't even gotten started
[80:40] yet, and Bloomberg's issuing headlines
[80:42] like,
[80:43] just so everyone knows and calms down,
[80:45] he's really into yield curve control.
[80:47] >> [laughter]
[80:48] >> That's insane.
[80:51] By the way, for those that don't know,
[80:52] yield curve control is like full
[80:54] degenerate money printing. That's the
[80:56] apex of money printing, cuz you're not
[80:58] even hiding it. That's above QE. That is
[81:00] literally creating dollars out of thin
[81:02] air and handing it to the government.
[81:04] That's not That That's That's not, well,
[81:07] you know, mortgage-backed securities
[81:08] rolling off the balance sheet, and if
[81:10] you do the math up here, and you divide
[81:11] it by over here, that is just flat-out
[81:13] like,
[81:15] here's a keyboard, create as many
[81:16] dollars as you need,
[81:18] and we will buy the bonds that you
[81:20] issue, so that the yields stay capped.
[81:22] Yield curve control, controlling the
[81:24] yield curve.
[81:26] So,
[81:28] I think that the market is going to be
[81:29] surprised that this guy is a politician
[81:32] and a disciple of Bessant, and a
[81:34] disciple of Druckenmiller, because the
[81:36] math is the math. All Bitcoiners
[81:40] align on mathematics. We want to be
[81:42] governed by the universe, by mother
[81:44] nature nature, by cryptography, by math.
[81:47] Well,
[81:48] the math of the United States is they
[81:50] have to print the money. It doesn't
[81:52] matter how nice of a guy, or how mean of
[81:54] a guy, or how cool of a guy, or how
[81:56] stressed of a guy, it doesn't matter. I
[81:57] don't give a [ __ ] about this guy.
[82:00] This guy has to print the money.
[82:03] And that's what he will do.
[82:04] And every single day that the markets
[82:06] get scared about it and start selling
[82:08] off more, we're going to get more
[82:10] Bloomberg headlines and more New York
[82:11] Times articles reinforcing that he's
[82:14] going to print the money. And that's why
[82:15] Trump elected him. And it didn't matter
[82:17] who Trump elected. Trump could have
[82:19] elected me.
[82:20] Unless I wanted to die
[82:22] and get imprisoned for the rest of my
[82:24] life, you have to print the money.
[82:27] That's the math.
[82:30] Uh okay, moving on to Bitcoin and
[82:31] markets questions. Greetings from the
[82:33] Netherlands. Wow, past midnight. Thanks
[82:36] for tuning in, man.
[82:37] How do you look at the scalability from
[82:39] Bitcoin? If everyone on Earth would use
[82:42] it, we'd consume more energy than the
[82:43] world right now
[82:45] just for BTC. Oh, just just for Bitcoin.
[82:50] Um
[82:52] I got a few thoughts here.
[82:54] For one, energy consumption's not a bad
[82:56] thing.
[82:57] Okay, let it be known that the story of
[83:00] humanity is commercializing energy from
[83:02] the sun.
[83:03] Commercializing energy from that orange
[83:06] thing in the sky is the story of our
[83:08] species.
[83:10] Being able to turn energy to heat our
[83:12] homes, fly us across the ocean, drive
[83:15] our cars, power these lights.
[83:20] Energy consumption
[83:22] is directly correlated to human
[83:23] prosperity. The more we've been able to
[83:25] commercialize and benefit from energy,
[83:27] the better off as a species we've been.
[83:30] Period.
[83:31] So, the notion that energy consumption
[83:33] is a bad thing
[83:35] is a lie.
[83:36] I've said frequently, "Oh, you don't
[83:39] like energy consumption? Well, I'll tell
[83:41] you what. The next time we go to Europe,
[83:43] I'll fly on a Boeing and you row a
[83:45] kayak."
[83:47] The next time you need to wash your
[83:48] clothes, I'll use my washer and dryer,
[83:50] you use your hands.
[83:52] The next time you want to watch a
[83:54] sporting event,
[83:56] you turn on a ham radio and I'll turn on
[83:58] my flat screen.
[84:00] The next time you need to commute to
[84:01] work, you walk, I'll drive.
[84:05] I am a energy consumer.
[84:09] I always will be and I want to produce I
[84:12] want to produce and consume more.
[84:15] I'm not going to feel bad about that.
[84:18] Now, the second thing, so for one, all
[84:20] the like energy naysayers, like, "Oh my
[84:22] god, Bitcoin uses too much energy."
[84:25] Good.
[84:26] That means it's valuable. That means
[84:28] it's part of the human story.
[84:30] Does an airplane use too much energy? Do
[84:32] the lights in your house? Do your car?
[84:34] Everything around you consumes energy.
[84:37] Now, then the next question is, well,
[84:39] how much energy should Bitcoin consume?
[84:41] As much as it demands.
[84:43] If there are people that have access to
[84:45] energy and they pointed at the Bitcoin
[84:47] network, that means Bitcoin earned that
[84:49] energy according to free markets. Cuz
[84:51] they could have plugged in a TV, they
[84:53] could have powered an airplane, they
[84:55] could have done a lot of things with
[84:56] that energy and instead they used it to
[84:59] mine Bitcoin.
[85:01] So, whose fault is that? Bitcoin's?
[85:04] That means Bitcoin is a good use of
[85:06] energy. That means the human species
[85:10] likes Bitcoin.
[85:13] Don't read the news to try and
[85:15] understand if people like Bitcoin. Look
[85:18] at how much energy is used on Bitcoin.
[85:23] That will That will tell you how much
[85:25] people like Bitcoin. Turns out people
[85:27] love it.
[85:29] It's a good use of energy.
[85:31] Let me tell you something. If someone is
[85:33] from a country with a collapsing
[85:35] currency that's living under an
[85:36] authoritarian regime,
[85:38] okay?
[85:40] Half the world lives in under an
[85:42] authoritarian regime.
[85:44] An oppressive government, restricting
[85:47] restricting them of their fundamental
[85:48] human rights.
[85:50] Things like freedom of speech, things
[85:51] like property rights, abusing them
[85:54] physically.
[85:55] And then they're hyper-inflating their
[85:57] currency. So, all of their time, their
[86:00] energy, their effort, their labor, their
[86:01] work
[86:02] is being stripped from them via currency
[86:05] debasement, okay?
[86:07] Let's picture someone like that in
[86:09] Venezuela, in Turkey,
[86:11] okay?
[86:14] Who are you
[86:16] to say that Bitcoin
[86:18] is not worth the energy.
[86:21] Let me say something. Do you think that
[86:23] that person in Venezuela would say,
[86:24] "You're right. Turn Bitcoin off. I'm
[86:26] glad you have a washer and a dryer.
[86:30] Glad you have a television and can watch
[86:31] the World Cup. No, no, no, no. Please,
[86:34] fly first class to Europe when you take
[86:37] your wife on vacation, but energy the
[86:39] energy's not worth Bitcoin for me."
[86:44] Have you lost your [ __ ] mind?
[86:50] That's what I would say to these people.
[86:53] It's not up to you what's worth energy
[86:56] or not. It's a free market, and guess
[86:58] what? Bitcoin's worth the energy. And
[87:01] guess what? Human flourishing is
[87:03] correlated to our ability to consume
[87:05] more energy.
[87:07] I would work on how we can consume more
[87:10] energy instead of telling other people
[87:12] how they should consume theirs.
[87:17] It drives me [ __ ] nuts
[87:21] when people tell No, no, no. You're
[87:23] living wrong. You're saving wrong.
[87:26] You're consuming energy wrong. Hey,
[87:28] guess what? [ __ ] you. Suck my dick.
[87:32] You
[87:33] Do These are the worst version of human
[87:36] beings that we have.
[87:38] The people that feel morally above,
[87:41] ethically above, and self-righteous
[87:44] enough to dictate what's right for other
[87:46] people.
[87:52] >> [sighs]
[87:54] >> Next question.
[87:55] Should someone seeking a loan backed by
[87:57] Bitcoin take it out at a high point in
[87:59] the market or at a low point, assuming
[88:01] average US income?
[88:04] I'm going to answer this question
[88:09] in a way Here. Here's my answer to this
[88:11] question.
[88:13] I'm going to answer this question by
[88:14] telling you I'm not answering this
[88:15] question. Cuz here's the thing, and I
[88:17] want to be super clear about this. I
[88:18] feel like I have been super clear about
[88:20] this, and I'm going to stay consistent.
[88:22] It's not my job, and it's not my
[88:24] company's job
[88:26] to manage anyone's personal finances.
[88:29] I've said
[88:31] consistently and repeatedly
[88:34] do not use too much leverage on
[88:37] anything. On your house, on your salary,
[88:40] on Bitcoin.
[88:41] Don't. Do not exceed your means.
[88:44] Do not spend more than you earn.
[88:47] These are fundamental things that I
[88:48] personally believe deeply in.
[88:51] When it comes to our products at Strike,
[88:54] and specifically we're talking about our
[88:56] Bitcoin backed loans.
[88:58] Our job
[88:59] in my opinion, and my opinion is what
[89:02] matters cuz I'm the CEO and I run it.
[89:05] In my opinion
[89:07] our job is to offer the market reliable,
[89:10] trustworthy products.
[89:13] And so when I'm evaluating risk, I'm
[89:15] evaluating our risk as a business. What
[89:18] is the LTV that we are comfortable
[89:20] offering the market at a substantive
[89:22] size?
[89:24] What are the recovery windows we are
[89:26] comfortable with? What is the recovery
[89:28] margin that we are comfortable with?
[89:31] As long as we are comfortable, we are
[89:33] reliable, we are trustworthy, we can
[89:35] scale with you. Then it is up to the
[89:37] market.
[89:39] It Can you imagine if I said, "No, no,
[89:41] no.
[89:42] You guys are using my product wrong."
[89:45] Going back to my last rant, it's not my
[89:48] job to determine what's right for you. I
[89:51] don't know your job. I don't know how
[89:53] well employed you are. I don't know your
[89:55] income. I don't know your savings. I
[89:56] don't know your marriage. I don't know
[89:57] your expenses. I don't know the
[89:59] expensive taste that your kids have. I I
[90:02] don't know these things, and I don't
[90:04] want to know. No offense. I love you
[90:05] guys. I don't want to know.
[90:08] So, it's really important. Now,
[90:11] what is my advice? My advice is
[90:14] borrow against a fraction of your coins
[90:18] so that you have the ability to add
[90:20] collateral. You should factor in that
[90:23] Bitcoin can go down 40, 50, 60, 70, even
[90:27] 80%.
[90:29] That should not be
[90:32] a surprise. That should be within the
[90:33] lexicon of your calculations.
[90:37] Now,
[90:38] what did you say assuming an average
[90:40] income or
[90:42] my brother in Christ,
[90:46] you're an adult. You got this.
[90:48] I can tell you guys how I use the
[90:50] product.
[90:51] I can give you case studies of other
[90:52] customers, but it I'm going to remain
[90:54] consistent here. It is super important.
[90:57] We offer an opt-in product. People say
[91:00] it's your fault. You're an [ __ ] for
[91:02] offering loans. I'm an [ __ ] I didn't
[91:06] force anyone to do anything.
[91:08] These products have changed people's
[91:10] lives including my own.
[91:12] I don't have to sell Bitcoin anymore.
[91:14] That's a huge thing for me. That's a big
[91:16] [ __ ] deal. I get to own more Bitcoin
[91:18] than I otherwise would and I get to sell
[91:20] less Bitcoin than I otherwise would.
[91:21] That's [ __ ] amazing.
[91:24] It's very, very important though that
[91:26] everyone
[91:28] owns self-responsibility.
[91:31] And you figure out that calculation for
[91:33] yourself.
[91:35] Question for Jack. Explain how Bitcoin
[91:36] is a liquidity thermometer. Emotional
[91:39] humans determine the price which aren't
[91:41] always rational. Worse, Trump says this,
[91:44] that, etc.
[91:45] Um
[91:47] Bitcoin's a liquidity thermometer
[91:51] in the sense that it's the most
[91:54] reactive
[91:56] to fiat liquidity. Bitcoin is priced on
[92:00] future expectations of fiat. Whereas an
[92:02] asset like gold front runs liquidity.
[92:04] So, seeing gold at $5,000 an ounce and
[92:06] hearing the US government talk about,
[92:09] "Oh, we might have
[92:11] yield curve control
[92:13] and all sorts of crazy shit." Gold is
[92:16] front running what's coming. You can
[92:17] look at gold and you can see the future.
[92:19] And the same thing happened in COVID. In
[92:21] the very early innings of COVID,
[92:23] gold was beating everyone's ass. And
[92:25] then Bitcoin came in the back half and
[92:27] outperformed it by orders of magnitude.
[92:30] And so,
[92:31] a liquidity thermometer meaning that
[92:33] it's the only fixed supply asset, it's
[92:35] the only free market. And so, then when
[92:36] liquidity gets weak,
[92:38] it feels the pain immediately.
[92:41] And when liquidity is abundant, it
[92:43] enters price discovery immediately.
[92:45] And these other assets, because of
[92:47] market structure, passive flows, because
[92:50] they're um not physical neutral
[92:53] commodity-like instruments that you can
[92:55] hold yourself, that don't have an
[92:56] issuer, that aren't associated with
[92:58] earnings or PEs or company. It's very
[93:01] unique in that sense.
[93:03] It's very unique. Everything else,
[93:05] houses, equities, software, you've got
[93:08] counterparty risk, you've got earnings,
[93:09] you've got CapEx, you've got a
[93:11] management team. And then things like
[93:13] gold are not nearly
[93:15] as tradable in a free market and as
[93:17] liquidity sensitive. So, Bitcoin is the
[93:19] closest thing we have to like a
[93:21] real-time index on fiat liquidity.
[93:27] Um hey Jack, curious if you could look
[93:29] into something. My dad and I want to
[93:31] know if a dynamic DCA is possible within
[93:34] Strike. For example, if the price dips
[93:36] below a certain level, we double or
[93:38] triple or et cetera our DCA amount.
[93:40] Uh
[93:42] it's not on the road map at the moment.
[93:44] The The most difficult thing
[93:46] in building a Bitcoin company is
[93:48] figuring out what to build now. You
[93:49] know, you're competing against line of
[93:51] credit, yield on cash. Um but we'll send
[93:53] it to the to the product team. If enough
[93:55] people want that, you know, the world's
[93:57] our oyster. We can build anything.
[93:59] Uh did something happen to loans in
[94:00] Portugal? The feature disappeared.
[94:03] Um we're live in Portugal.
[94:06] If uh if you don't see it in your cash
[94:09] tab, the product, just hit us up. Um I'm
[94:11] happy to help, but we're live. Nothing
[94:13] happened there. Um should be able to to
[94:15] borrow against your Bitcoin in Portugal.
[94:18] Um
[94:20] let's see. Why does Strike use Plaid?
[94:24] Why can't we just connect a bank account
[94:26] and do ACH deposits?
[94:29] You want the long or the short answer?
[94:32] The short answer is fraud.
[94:36] The US is the only financial system, and
[94:39] I run a global
[94:41] company, right?
[94:43] The US is the only financial system
[94:46] where
[94:49] you can deposit money
[94:52] and then say, "Never mind, I didn't do
[94:53] that." and take the money back like
[94:55] after you already said you wanted to
[94:57] deposit it.
[95:00] And so
[95:01] Plaid
[95:02] and other services offer things like
[95:05] fraud protection and help companies like
[95:07] ours fight this ridiculous system. So
[95:11] crazy. Like you could buy Bitcoin from
[95:14] me.
[95:15] I give you the Bitcoin, and then you
[95:17] say, "Oh, never never mind, that wasn't
[95:18] me." But you keep my Bitcoin. What the
[95:20] [ __ ]
[95:24] So that's why.
[95:27] Um for some customers, we do enable like
[95:30] no Plaid. Like if you're a super trusted
[95:32] customer
[95:33] and you really hate Plaid, I know we
[95:34] have the ability to enable it, but it
[95:36] it's
[95:37] it's just fraud, man. Like the US
[95:38] financial system's a mess.
[95:40] That's the truth.
[95:42] We're working on I mean, we know that
[95:44] there's feedback and there's different
[95:45] things we experiment with.
[95:47] Um
[95:48] and uh
[95:50] we uh
[95:51] are going to constantly iterate and try
[95:53] I mean fraud is a top-of-mind thing for
[95:55] us always. Like we have a data team
[95:58] that's consistently iterating on fraud
[96:00] models and, uh, trying to make the
[96:01] experience better for our good
[96:02] customers. But, anyways, that's the
[96:04] answer.
[96:05] Checking in from Germany. Can someone
[96:07] ask later if we can get our DCA and
[96:09] purchase history in the Strike app? I
[96:10] need to go to bed.
[96:12] It should be,
[96:14] uh, it should be in your activity, I
[96:15] think. I I can't tell what you're
[96:17] asking. But, uh, I hope you are getting
[96:19] a good night's sleep and it should be in
[96:21] your activity inside the app already.
[96:24] Uh, do you have any plans to bring more
[96:25] Strike features to the UK like loaning
[96:27] against your Bitcoin?
[96:29] Uh, regulation is the issue.
[96:31] Uh, but we are Sorry, the end of their
[96:33] question is is regulation stopping you?
[96:36] Yes, regulation is stopping me. Um, but
[96:38] we are working on it and we are going to
[96:40] get the more features there. You know,
[96:41] for us it's a it's a matter of when, not
[96:44] if.
[96:45] If it's if if we aren't in the country
[96:46] now or where you don't have a feature
[96:48] now, it's because of regulation. I never
[96:51] am like, oh, these Brits in the UK, they
[96:54] don't deserve my lending product. I
[96:56] would never do that. I would never do
[96:58] that. So, it's always about it's always
[97:00] regulation is the issue. So, um, if we
[97:03] aren't live with something, there's a
[97:05] 99% chance it's because I'm not allowed
[97:07] and I'm working on being allowed.
[97:09] Uh,
[97:13] Let's see. Any news on getting Strike
[97:16] loans going in the EU?
[97:18] Uh,
[97:19] would be great in Germany in particular.
[97:21] Guys, we have loans in Europe. May I I
[97:24] I'm reading through these questions and
[97:25] it seems like you guys don't know.
[97:27] Our loan our lending product is live in
[97:30] Europe. If you want to borrow against
[97:31] your Bitcoin, you can do so in Europe.
[97:33] You go into your cash tab.
[97:35] So, for you guys it would be your euro
[97:37] tab. And you can borrow against your
[97:40] Bitcoin. If you have any questions, you
[97:42] could DM me on Twitter, DM Strike on
[97:43] Twitter, reach out to our support staff,
[97:45] but we are live in Europe with our
[97:49] loans.
[97:51] Um
[97:53] How much do I worry about being a public
[97:54] figure in regards to $5 wrench attacks?
[97:58] Um
[98:02] I don't worry much. Ah. Not not worth
[98:06] uh the time
[98:07] on this. That's not even a straight
[98:08] question.
[98:09] Uh Dylan, are loans available in New
[98:11] York for businesses? No, we're not alive
[98:13] in New York yet for anything, but we've
[98:16] been told it's any day now. Fingers
[98:18] crossed.
[98:19] Fingers crossed. Send a prayer.
[98:22] Um
[98:23] Hey Dylan, can you ask Jack
[98:25] uh will Strike ever add the ability to
[98:27] deposit a paper check via mobile
[98:28] deposit? I know Cash App does this. Yes,
[98:31] in 2026 we will enable that.
[98:34] Boom. Bingo. Let's go.
[98:37] Um
[98:42] Let's see. Some of these are repetitive.
[98:47] Uh Jack, what's the quickest way to get
[98:48] our Strike instant limit increased? I
[98:50] need a large increase. Thank you so
[98:52] much. Um you guys can always reach out
[98:54] to private@strike.me.
[98:56] That's our private client desk. And you
[98:59] know, whether it's a high net worth
[99:00] transaction, you need instant limits for
[99:02] a large event in your life, you need
[99:05] help with a loan. Um
[99:07] you can get on the phone, get on a call
[99:09] like this, like a Google Meet or a Zoom
[99:11] or whatever you want uh with our private
[99:14] client team, and we're more than willing
[99:16] to have help you out. It's like a white
[99:17] glove service.
[99:19] So, um anyways,
[99:21] check that out. For this uh specific
[99:23] instance, reach out to
[99:24] private@strike.me, and that goes for
[99:26] anybody that wants to talk to a human,
[99:29] you know, has a request, a one-off
[99:30] instance, a large purchase, a large
[99:32] loan, something with their account.
[99:35] Okay. Other questions. Uh Jack, thanks
[99:39] for the hope and the education you
[99:40] share.
[99:41] What biz during
[99:44] art renaissance will see success in your
[99:47] opinion?
[99:48] Tell us about your biz background. Have
[99:50] you started one that didn't succeed?
[99:53] Yeah, man.
[99:54] Um so I think this question is
[99:56] referencing my opinion
[99:58] on uh
[100:00] how AI and Bitcoin will enable a new art
[100:02] renaissance.
[100:04] Because Bitcoin will allow you to
[100:06] actually save and persist wealth.
[100:08] So right now everyone's a speculator.
[100:10] Once you get your paycheck, you have to
[100:11] use it to speculate. Sports gambling,
[100:14] punting on equities, crypto degen stuff.
[100:17] Just to keep up with the purchasing
[100:19] power to eventually buy a home.
[100:21] And with Bitcoin, [snorts] you can just
[100:22] save. You don't have to worry about
[100:24] that. And so if your wealth that you're
[100:27] creating today actually lasts through
[100:28] tomorrow, and AI does a lot of the
[100:31] mundane white-collar work, then humans
[100:33] are left to be creatives and artists.
[100:36] And I mean artists not in just painting
[100:38] or music. But I think my job is an art.
[100:41] How can I create a show or a product or
[100:44] tweets or a podcast that conveys
[100:48] information, education, a message? How
[100:51] can I help revolutionize a cohort of
[100:54] people on the internet to rally behind
[100:57] open-source software that can change the
[100:59] world? I view a lot of what I do as art.
[101:02] And so I've always thought that
[101:04] Bitcoin and AI empower the artist. Like
[101:07] AI hasn't disrupted me. It's made me a
[101:10] better artist. It's helped me hone in on
[101:13] my ideas, do research. Like the
[101:15] presentations I do now are so much
[101:17] better because of my AI tools.
[101:19] And so what business will do better
[101:22] during this art renaissance?
[101:25] Well, I think again, I think the world
[101:27] will reprice things. I think physical
[101:31] things
[101:32] are not priced properly. Things like
[101:35] Bitcoin, things like gold, things like
[101:37] land.
[101:38] I don't think these things are priced
[101:40] properly. I don't think
[101:42] profits are priced properly. You're
[101:45] seeing these tech companies all of a
[101:47] sudden go from insane multiples to
[101:49] barely any multiples at all
[101:51] because the premium is gone. I think
[101:54] finding a high margin business, a high
[101:57] growth and cash producing business is
[101:59] going to become more and more of a
[102:00] rarity when there's not just like free
[102:03] money slashing around and there are like
[102:06] physical constraints to your business.
[102:08] Um I think that is severely undervalued
[102:11] and underpriced. That's why I'm super
[102:12] bullish businesses like Strike and super
[102:15] excited about what we're doing achieving
[102:16] profitability so young in our in our
[102:18] corporate career.
[102:20] Um and then I'm really bull bullish
[102:21] artists. And again, maybe I should work
[102:24] on defining what I mean by that.
[102:26] But I think artists are influencers,
[102:29] creators,
[102:31] unique ideas, those that can motivate
[102:33] and lead people,
[102:35] um those that inspire. These are all
[102:36] things that AI
[102:38] can't do.
[102:40] Um I can't get AI to manage
[102:43] and motivate
[102:45] a group of employees.
[102:47] I can't get AI
[102:49] to create, you know, visionary concepts
[102:53] and revolutionize people on the internet
[102:56] behind them.
[102:57] Um and so I think companies will have
[103:01] less head count and less overhead when
[103:03] it comes to people,
[103:04] but
[103:05] there'll be a higher premium placed on
[103:08] the best performers and the best
[103:10] artists. And like there's an art in even
[103:12] executing. Like it's an art to take an
[103:14] idea and take a vision and actually do
[103:16] the work, prioritize things in the right
[103:19] way, manage people effectively, set the
[103:22] right goals, get [ __ ] done. That's an
[103:24] art.
[103:27] It's not a hard skill you're like, oh,
[103:28] I'll just take that one class at Cornell
[103:30] and then I'll I'll figure it out.
[103:32] It's an art.
[103:35] So, I'm bullish
[103:37] whatever that is, human creativity and
[103:40] artistry within your craft.
[103:43] You know,
[103:44] certain people will be worth way more to
[103:47] a business. Everything else will be
[103:48] automated.
[103:51] So, I don't know if that I don't know if
[103:52] there's a specific like obviously AI
[103:55] can't replace restaurants.
[103:58] So, you know, hospitality will still be
[104:00] an industry. I think there will still be
[104:02] a premium on a fine dining experience.
[104:05] Um
[104:06] but anyways,
[104:08] I don't know if that's a good answer or
[104:09] not.
[104:11] Um
[104:14] let's see.
[104:16] I think that's it. Is that all Dill?
[104:21] I mean I've been so active uh
[104:25] on Twitter
[104:28] trying to refute fud. I'm surprised you
[104:29] didn't put any of that in here, but
[104:31] maybe that was a
[104:33] a purposeful decision.
[104:35] Uh
[104:36] I'm just checking
[104:40] uh my text messages
[104:42] and the chat.
[104:47] Um
[104:49] cool.
[104:51] Okay.
[104:54] I will uh
[104:56] I think that's it, guys.
[104:57] For this week.
[104:59] Uh keep giving me feedback. I read all
[105:01] the YouTube comments and the tweets and
[105:02] stuff. Um I try.
[105:05] It it's a
[105:07] I'm growing in in like pride that I am
[105:10] one of the most accessible,
[105:13] you know, CEOs, whatever you think I am,
[105:15] podcasters. Um you can tweet at me,
[105:17] you'll get a response.
[105:19] Uh
[105:20] you can leave a YouTube comment, know
[105:21] I'll read it.
[105:23] Uh
[105:24] I want this show to be good. I want it
[105:25] to be educational. I want you guys to
[105:27] learn from it. I want you to be
[105:28] entertained. So, all the improvements I
[105:31] think someone said this is a 2-year
[105:32] anniversary cuz it's episode 104 and
[105:34] there's 52 weeks in a year. So, I guess
[105:36] I've been doing this for 2 years.
[105:39] Uh and the beginning episodes were not
[105:41] very good.
[105:43] And these are much better. And uh that
[105:46] is in large part to you guys. You guys
[105:48] really directed me telling me what to do
[105:50] less of, what to do more of. So, keep
[105:52] giving me feedback. Uh hang in there.
[105:55] You know, hopefully the Bitcoin price
[105:56] charts and some of that data was useful.
[105:59] Um the worst part's almost over. You're
[106:01] going to be okay. Um no pain, no gain.
[106:04] Uh if it was easy, everyone would do it.
[106:06] You're okay. You're going to survive.
[106:08] Hunker down.
[106:09] Um green pastures ahead.
[106:11] And uh the dip
[106:13] weirdly is cuz of software, but I think
[106:15] it's a good thing in the long run.
[106:17] And with that, I'll catch you guys next
[106:19] week. Same time, same place.
[106:22] Peace and love.
[106:25] Take care.
[106:26] Bye-bye.
[106:28] Where's the stuff from? Bye.