Bitcoin Is the New Hurdle Rate: Corporate Treasuries Are Waking Up

[Music] Let's be clear, Bitcoin is an international asset. We are spending like drunken sailors. Bitcoin is the only economic entity where the supply is unaffected by the demand. If you want to preserve your wealth, you have to convert that currency into an asset that's scarce, desirable, portable, durable, and maintainable. We just recorded this episode with Tim Cotsman and Ethan Peek. And if you're wondering what the next wave of Bitcoin adoption looks like, this is the one to tune into. Ethan joins us as the director of Bitcoin. What a title, right? At Strive Asset Management, and we dig into how corporate adoption is accelerating from the inside out. We discuss shareholder proposals at Microsoft, Dell, and Meta. the rise of dedicated Bitcoin treasury companies and the growing battle inside boardrooms, capital markets, and public perception. The remarkable part though is we've all had a chance to frontr run the big boys. So, let's not mess this up. If you're holding Bitcoin for the long term, consider On-Ramp's multi-institution custody, a secure vault solution that eliminates single points of failure, includes insurance coverage through Woods of London, and makes inheritance as simple as logging into your account and clicking a few buttons. Get your Bitcoin situated now, so as the price marches higher and bigger pools of capital step in, you can enjoy it without having to stress about the whatifs. It's almost summertime, so don't worry about the Bitcoin. Head to onrampbitcoin.com. You can sign up in minutes or you can book a consultation with myself, Cam, Michael, whoever. I'll see you then. Enjoy the episode. All right. Well, it's time for scarce assets. We have an interesting one today because we have Tim Codsman. Tim is usually on the last trade. We did record the last trade just yesterday and the audience wanted to know wanted to know where Tim was. And so my my concern and the audience concern was last time that Tim was on the last trade, he allegedly was recording from the back of a taxi cab, but we weren't sure if it was actually a police car. And so I just assumed that Tim's been locked up for the past two weeks. So Tim, it's nice to see you're back to uh business as usual. You have the orange tie on. And then uh the guest of honor today is Ethan Peek. Ethan is the director of Bitcoin. We were just talking about how uh cool of a title that is at Strive Asset Management. and Ethan and I uh I guess we briefly encountered back at Palm's event in New York in February the Bitcoin investor week on ramp and Shrive co-hosted a lunch so I had a brief opportunity to connect there but Ethan it's great to see you really excited about all the work that you're doing and uh get to know you a little bit better on today's show thanks for joining us thanks for having me on it's a pleasure good to see you again Tim and uh Jackson and yeah there's a bunch of uh good companies in this space on 2 and Pleasure to be here. Excellent. Well, yeah, Ethan, why don't you just tell us a little bit more about your background? So, director of Bitcoin, that's it's a big title. It's about as big as it gets. And so, would love to just understand a little bit more about your background. How did you land at Strive doing the work that you're doing and then we'll we'll go further from there, but let's just get people familiar with the uh your background and the work you're you're focused on at Strive. Cool. Yeah. So, first of all, I'm on the corporate governance team at Strive. So I'm on I'm the director of Bitcoin on all matters relating to corporate governance. Uh more specifically. Uh so it's not as broad of a title as it sounds, but that's because of my background. My background is in shareholder activism. And so for three years I was a shareholder activist at a nonprofit filing shareholder proposals. Most of those shareholder proposals dealt with ESG um pushing back against ESG specifically uh the companies that took it too far uh were doing things against fiduciary duty, against the interest of their shareholders. And so I just tried to keep corporations honest. As part of that, last year I submitted a shareholder proposal to Microsoft asking them to add Bitcoin to their balance sheet just because I thought that it fit within the frame of fiduciary duty and because corporations were ignoring um their mismanagement of their treasury. Uh so it didn't really come from a place of like rah Bitcoin even though I am. Uh but it was just uh for the best interest of Microsoft shareholders for the you know that's that's where it came from and Strive saw that Matt Cole CEO of Strive saw that and as uh Strive's dedication to Bitcoin and being a responsible asset manager that really puts its clients first realized that we need to also uh include in our voting paradigm uh for directors for shareholder proposals uh and engagement worth corporations uh a pro- Bitcoin stance because that's in the best interest of shareholders and Strive's clients and so that's how I got hired at Strive and I've been focused on engaging with corporations on all matters relating to Bitcoin. Very cool. Uh natural synergies here between you and Tim, host of the Bitcoin Treasuries podcast, which everyone should certainly check out. So Ethan, that's an interesting background. Um, so right before we hit record, you just mentioned ESG briefly and I figured we'd save it for the conversation. So, how did you end up in a role where you were um I guess on the other side of ESG? Not to say that um I I guess the the bigger point there is like ESG was this very popular way of investing for the past like half a decade or so, perhaps longer. And everyone was on board with ESG and DEI. And then things kind of shifted over the past call it year or so. And I know Strive was uh really loud about their advocacy for just doing things let's say the right way, focusing on the business, focusing on the shareholders and focusing less on these like more subjective things around ESG. And so how did you end up in a role where you were doing that? And then uh I'm interested to hear how like Bitcoin kind of fits into this as well. like is this were these like two totally separate interests of yours or was there any sort of overlap between the two before you joined Strive? They were two separate interests. Um so I actually got into it because I started getting interested in politics um a couple years ago. I joined uh my former job national center at public policy research as a shareholder activist a couple months before Strive uh became a company. Uh so a lot of different organizations around that time like popped up and and started uh pushing back against ESG because it got so loud and was um really taking over the culture. Um and so I was kind of like um reformed liberal. I used to be more on the left uh when I was younger. And as part of my becoming conservative, like a little bit before COVID and around COVID, I started getting interested in more of these ideas and I I reached out to a conservative nonprofit um because I saw their job listing and it was about shareholder relations and getting companies back to neutral and I was like, that's something I could definitely get behind. and they asked for a writing sample and actually at the time the writing sample that I gave them was this like uh this 20page paper on Bitcoin for my master's degree uh on cyber security and that's what got me hired there. So it wasn't there were two separate interests but I'm happy that it sort of started there like together and now it joined back. So um came full circle. Very cool. So you must have a knack for writing then because you mentioned So yeah. So did I understand correctly? You mentioned you got on the radar of Matt Cole and Strive by the shareholder proposal or letter that you wrote to Microsoft and was that toward the end of last year? Maybe fill in some of the gaps around that. So Strive much to their credit um because they're the best asset manager in the game. I'm not just saying that because I worked there. I thought that before too. um was the o like the only big asset manager shareholder to vote for that proposal. If you guys remember it only got 0.55% and Strive voted for it. So you know big credit to Strive uh as leading the way in act responsible investment stewardship and it was just from that that that Matt saw me and and podcast that I went on including one with Tim um and with Tom and and uh he reached out and it's just a natural fit based on my background and been great. That's incredible. So today at Strive, are you focused predominantly on drafting proposals and letters to public companies? Is that the core focus of your role? And perhaps if there's anything else, what else are you working on at Strive these days? Yeah, so it's a couple of different kinds of engagement. So there are proposals. It's right now not proposal season. So, the the season for submitting proposals are in the fall and we're going to submit a few uh and look to submit a few and then but for now since it's the off season of when you can submit there have been a few different engagements. So, you guys saw the letter to GameStop uh you guys saw the letter to Inuit. Um did you see that? So, we we sent a letter to Intuitit because Intuitit um was censoring Mailchimp was censoring its users uh that were sending out emails that included Bitcoin in it. And so, that's a completely first of all, it's a completely inappropriate uh policy to censor users and customers that way. It's, you know, runs against the interest of shareholders to have such a stringent anti-free speech view. So from there, just from that standpoint alone, we sent them a letter and then we also asked them to add Bitcoin to their treasury in that letter because uh one of their flagship products, Turboax is uh at risk of AI disruption because you know we feel that a lot of companies that can be automated by AI uh will go away in the future that there's going to be a lot of uh disruption in the next decade and that a Bitcoin war chess is the best thing that you can do as a to protect yourself against that, you know, these sorts of events. And so that that was our recommendation letter to them. We also had a couple of other engagements with other companies that have to remain private for now. Um, but we're we're actively reaching out to companies and we're also considering different uh Bitcoin related things in the way that we vote. So there's it's not just the as an asset manager it's not just we're not just like we're not a activist like in my former role. We also have to vote on these proposals on behalf of our clients. And so if we see a director that's particularly against Bitcoin or even AI it's not forwardlooking. Um that's something that we consider in our in our voting paradigm and definitely we're going to do that more going forward. So that's that's what I'm focused on and then other matters relating to um our general Bitcoin strategy. Awesome. Yeah, it's incredible to hear that the there was only 0.55% uh vote in favor of Microsoft adopting a Bitcoin strategy. And so that just goes to show how early we are. And I'd also assume that it goes to show how challenging of a uh opport challenging of a role you're sitting in, right? Where it's still Bitcoin is not still fully accepted within the traditional finance institutional investment space. It's starting to get there, but it's really still a long road ahead. Even if people don't want to admit that the ETFs have only existed for a little over a year, it's creeping its way into portfolios, but for the most part, uh, Bitcoin is still treated at as this like radioactive asset class that people don't understand. It's you anchoring back to the vol its teeth. It's too volatile. And um, so it's an uphill battle, but it's a really good battle to be fighting. And so I'm curious like as you think about the strategy at Strive, first could we answer the obvious question like how do you kind of position Bitcoin as part of a treasury strategy for a company? What like what are the leading talking points there to advocate for it? And then the second part and I can reiterate if you forget but would just be like what are the type of companies that you're going to focus on as part of this shareholder activism. Got it. So first of all, yes, it's a completely uphill battle. no doubt in my mind, but I was sitting in the same exact position in 2020 um in 2021 and 2022 with ESG and it was also I don't know if you guys remember back then how you know in the culture and powerful like DEI was and now it's on its last legs and I remember submitting a proposal to Boeing um asking them to get rid of DEI and it got 5.6% 6% of the vote and then 3 months later Boeing dropped the EI. So these things happen, you know, gradually and then suddenly. Um, so I'm actually very excited and very hopeful uh for the future of Bitcoin treasuries and I think it's actually happening faster than the death of ESG happened, but it still is an uphill battle. The kind of companies that we're targeting are ones that are susceptible to AI disruption, first of all, ones that have um mismanagement of their balance sheet. So, if they have like a large cash position relative to their market cap, um that's something to consider as well. um and companies that may have an interest in doing this already cuz a big part of this is that there's such resistance from like the boomer directors at a lot of these companies. They're just like there the directors at these companies are such an echo chamber. They sit on multiple boards at the same time and they're so overlapping and they they just have their view of the world and there's not a lot of um heterodoxy. Uh so uh anytime we get a director at a company or a CEO of a company that has shown some you know positive uh views towards Bitcoin we say hey you know we try to open a conversation there and so those are the different things that we're considering and then the last thing as you guys have seen with our recent announcement I'm assuming is that we thought that as we're you know advocating this on behalf you know for other companies we looked at ourselves and we thought that uh we should also be a Bitcoin treasury company and so we're very proud that we're moving towards that direction and if anyone wants to see more on that they can I can't speak any more on that because it's you know private information but anything that's publicly available you can go to our website uh and uh strive.com and and there's a bunch there. Yeah, that is exciting. I'm I'm looking forward to following that a bit closer. And so that's an interesting point, the last piece that you mentioned where it's looking for people who are within an organization that may have expressed some sort of inclination or interest or ownership in Bitcoin. Because at On-Ramp, we help quite a bit on the private client side, the individual side. Our clients are incredibly sophisticated and their understanding of Bitcoin and the value proposition of the business. But then when you go to the institutional side, it's more going back to that radioactive asset, right? And so typically on the institutional side of the business, you need to find people within those organizations who already own Bitcoin themselves, you know, would maybe identify themselves as a Bitcoiner. And so it's interesting to hear that you're applying that same framework for some of these conversations because if you have that internal champion or advocate, I'd imagine you could really accelerate things versus trying to work only from the external. Yep. Absolutely. And Tim's interviewed like I think more than anyone on earth, the most CEOs and directors that like have adopted a Bitcoin treasury. So I think he he can speak better than anyone on what's the who's the kind of person that would actually do this. Um what do you think Tim? Yeah I mean certainly it really comes down to as Sailor would say people who have a need to know. So yes, zombie companies, but also to your point, companies that are already being disrupted or otherwise need to hear from their shareholders about you're just like needlessly censoring free speech. That's just kind of crazy to even realize that that's happening in 2025 in, you know, globally, but in the United States, it just kind of is mind-blowing. So, I would say any company, but the ones that are probably going to be last or maybe not a leverage strategy, but just putting some on the balance sheet would probably be the MAG 7 excluding strategy when they get into the S&P 500. Um, because they have a business that is going to be probably, right, we all we the buzzword this week is moat, right? Do you have a moat? How big is your moat? Do you have a boat with your moat? Like all these moat type uh adjectives. But in all seriousness, if they have a cash flowing business, they they are either um have they're either of a certain size or they are just so focused on their current operation that this is kind of the last thing that they would even be focused on. and then layer into that if they don't have someone that's at all vocal about Bitcoin as a commodity, as an asset class in house, then that probably is an even uh tougher climb uphill. Yep. And um I completely agree. And I also think that some of these like some of these directors or or CEOs that show a positive um attitude towards Bitcoin like in their personal lives, they're still hesitant to to adopt it for their company. And that's that has been the biggest frustration. Um like Michael Dell for example, I think you guys may have seen that um the proposal at Dell, they requested that the company uh the company requested that the proposal that I sent at Dell back a couple months ago uh be left off the ballot and not be even allowed to be voted on by shareholders. And they requested that of the SEC and the SEC granted them permission to do that. Um unfortunately. So that's a little bit of a setback and we can discuss that a little bit. But Michael Dell is someone that's shown uh a number of times like a positive view towards Bitcoin and still his company went against this proposal just asking for like a report on Bitcoin. And so that shows you the dichotomy between what a lot of these people are willing to do in their personal lives and what they're willing to do for their companies. And I think that a lot of that just comes down to nobody wants to I think Nobody wants to be held responsible if they make a mistake or they're very they play it so safe. And it just gets back to like this like environment of quarterly capitalism that we live in. All these companies are just going quarter to quarter, you know, playing with numbers, playing all these little tricks just to make the next uh 10 Q look good. And they're not thinking about the long-term interest of their shareholders. And that's just the way that uh directors are put on boards, how people retain their jobs, and nobody's, you know, going out on a limb. It takes someone like a Michael Sailor to say, "I'll do it." Um, and that's a part of the theme at a strategy world. And I think that Tim, I think you guys talked about this on the last podcast that you had uh with Matt Cole and Ben and Jeff. Um, shout out um to uh hurdle rate pattern. Uh that courage is in scarcer supply than intelligence. And that's really what it takes. Yeah. Either be a disruptor or be disrupted. And it might not happen overnight, but I think in the in the coming months and quarters, you're going to see it, right? Maybe not weeks, but definitely not years at this point. And that's my personal view. Mhm. Yeah. I saw that stat that Sailor included in one of his presentations in Orlando about 96% of companies believe it was underperforming tea bills. Is that right? Um if one of you could correct me. Did you see that one? I think it was I don't remember the exact stat. I I I think it was that 96% of the companies like underperformed the S&P in the S&P underperformed the S&P. I wasn't sure. But was it T-Bills? I'll have to check. Um, it was one or the other, but it Yeah, I guess I guess the broader point is that the there's so much concentration in the S&P 500. Tim already called out the MAG 7. I mean, there that's probably what, like 25 30% of the index in terms of um market cap and then it drives the outsides of the returns. And so, yep. If I'm one of these other 493 companies in the S&P 500 that is either whatever it is, whether they're struggling to beat the index itself or they're struggling to beat T bills, I should know that stat. I'll hopefully find it during this episode. But either way, I think I'd be looking at opportunities to potentially increase my shareholders return. And Bitcoin feels like an obvious place to go because you mentioned Bitcoin as a hurdle rate and something we focus on at Early Riders as well. Tim's an adviser to the venture fund, but every capital allocation decision is made with Bitcoin as the hurdle rate Yeah. And so do you want to talk more about that um at Strive just in terms of how that informs your business decisions and maybe how you articulate that to uh companies that aren't as convinced about the merits of Bitcoin as we are? Yeah. Well, I can't speak more to our treasury strategy right now. Again, I'll point you guys to the website, but um uh Bitcoin is the hurdle rate for capital deployment. And I you know, you've seen Matt has said this himself. uh he holds himself as the CEO to that same exact standard and he said that anyone that deploys capital um and doesn't beat Bitcoin uh should be fired and we we hold ourselves to that standard and and and that's the way that as we look to become a Bitcoin treasury company and uh that's the way that we're going to evaluate uh opportunities going forward against Bitcoin and that we believe that every company especially the ones that uh have already adopted Bitcoin should do Yeah, I mean it makes a ton of sense. I think it was Fidelity uh Chris Kyper, head of research there, who was speaking about this idea, right, where if you're in a if you're deciding how to allocate capital within your organization, you really should be evaluating those decisions based on Bitcoin as a hurdle rate, which I think the number he pointed to, I forget the time frame was it probably was 5 years, 65% Kager. And so if you reorient your capital allocation decisions to Bitcoin, it totally changes the game, right? Like if you're sitting on a pile of cash and you have to beat a 65% keer, well, there's very very few ways to do that. Um it's just like it totally changes the game. It flips the script of capital allocation. Yep. And what I think that it does the most is this gets to, you know, the idea of a Bitcoin standard compared to a fiat standard. It cuts a lot of the nonsense. It cuts a lot of the waste. Uh having lived through a century of easy money. Uh there's a lot of there's a lot of nonsense. There's a lot of waste. There's a lot of lowquality products going around. And the, you know, we believe that uh if you're stringent and you have to be um really careful and and and in in the way that you allocate your capital and and really discriminate only for the best ideas and the best opportunities, it's going to lead to an era uh not just success for your own company, but an era if the more that more companies do this and the more that this becomes a standard across many corporations and across countries, ries and markets. This will raise the standard of the goods and services I believe. How do you articulate that though to if you go back to Microsoft, right? Just to use them as an example, not even a percent of uh shareholders wanted to approve the proposal to add Bitcoin. And so that just goes to show again the uphill battle that we talked about how early we are. And so it's probably really challenging to tell people that Bitcoin is a hurdle rate if they lack an understanding of what Bitcoin is, right? So what are what are some of like the more 101 types of conversations or um positioning that you use at Strive as part of the shareholder activism strategy to convey the merits of Bitcoin? like how how do you get from I we're a board, we don't really know anything about Bitcoin to eventually deciding that Bitcoin is a hurdle rate and it's worth deploying our cash into that until we can further allocate resources. Yeah. Uh first of all, even though only like less than a percent voted for that proposal, we have to remember that it's not the actual ultimate shareholders that voted on that. It's the big three asset managers, Black Rockck, Vanguard, and State Street. uh and other big asset managers like Goldman and JP Morgan and Bank of America. They're the ones voting on behalf of their clients. And then you have the big two proxy advisory services, ISS and Glass Lewis, they're they're recommending the votes on behalf of a lot of these pension funds um and state pension funds. And so that do and a lot of retail investors, they don't they don't vote their shares. And so what you end up with a situation with is over 90% of the vote, even higher maybe, is coming from these large institutional asset managers. And that's why the votes are so lopsided. As soon as like Black Rockck and Vanguard flip, all of a sudden the votes 40%. So it's like that that's that's what we're really dealing with. if you actually pull the clients of the funds, you know, Black Rockck and Vanguard funds, it's not going to be one less than 1%. Um, so re that's why these things can be such lopsided votes, but it's also why they can flip very quickly. Um, uh, so that's the first thing. And the second thing I would say is that when I'm discussing this with with with companies, when I discuss it with Amazon, with Dell, with McDonald's, with Microsoft, um, Meta, there's almost the same conversation every single time. The the very first thing that they bring up and their biggest concern by far is volatility. Um, and so when you look at it, a lot of these companies, yes, they have a lot of cash, but when you look at it as a as a relative to their market cap, their treasuries are usually not that big in in the first place. So to their own, you know, to their own credit, their treasuries, the amount of cash that they have really and their shortdated treasuries really only covers their short-term expenses and and a little bit beyond that. So, it's not like a lot of it is inflating away. And this is something that, you know, I learned having engaged with them a little bit more, but that's the problem that they're so shortminded. They're only thinking about the next quarter. They're they're they're not thinking 5 10 years down the road. They're only thinking about the short short-term interest of shareholders when they need to be balancing the short-term and long-term interest of shareholders. Think about how many shareholders own Microsoft and or these funds for 20, 30, 40 years. Like, do they not have an interest to to, you know, to serve those in those interest for those shareholders, too? Of course they do. But they're not considering that because they don't want to get fired. They don't want to rock the boat, and they're just comfortable running their corporations in this um quarterto- quarter way. And what I found was that you know it what's really interesting is is is this quarterly capitalism is this mindset of shortdated treasuries um uh like is this the byproduct of fiat or like that's that's really where my head's been going lately. So it's it's not like I think that once corporations adopt a Bitcoin standard or adopt Bitcoin, it's not just going to like adjust their hurdle rate. It'll also like be a a solution. It's a hedge against inflation. It's it'll adjust a hurdle rate, but it'll also it's also an answer like in a hedge against managerial myopia against short- termism and it fixes their time preferences and it completely reorients uh companies I believe. Yeah, absolutely. No, that it's a fair point and I think at the end of the day this is more of a grassroots adoption that we've experienced in Bitcoin and so I mean all these people are individuals within organizations, right? And so the the path of least resistance is to have more individuals understand the merits of Bitcoin for their own personal lives. And then to your point, Ethan, there needs to be a a an opportunity or a path towards more courage in corporate boardrooms and in institutional investor community to actually be some of the first people to adopt Bitcoin in a more meaningful way. And so that seems to be a challenge at the moment. Just when I look at Bitcoin treasuries, we have uh of course strategy leading by a wide margin. But then the other largest treasuries are call them Bitcoin or cryptonnative businesses. So you have some miners in there, you have exchanges, but then there's very few companies that are not in the industry that have adopted a Bitcoin treasury playbook. But it's exciting to hear that Strive is at the forefront of doing this. And I am encouraged. I think it's just a matter of survival. I did look up the stat as we were talking through this. 96% of the companies have returns in line or below T bills, not not S&P 500. Okay. Right. So, these companies are at pace or worse than what's perceived to be a risk-free asset. Now, does is it risk- free? That's a topic uh of a different discussion. But at the same time, it's like we all know if you're getting a 3% or 4% coupon on something, you are losing purchasing power over a one, five, 10 year horizon. And so there does become a point where these companies just adopt it out of necessity. I mean it at some point it doesn't become a choice anymore. It's like all right, we either want to continue to exist as a business and to do so we need to figure out ways to invest our capital that will outpace the basement or we don't exist anymore or we're required, right? I mean, isn't it that simple? It just it's it's a matter of survival. Mhm. A lot of these companies also when I engage with them, they're doing a lot of like the the treasuries aside, right? If those cover their short-term expenses, they're doing a lot of buybacks and a lot of dividends. And so, like something that Amazon told me was that the the you know, Bitcoin is too volatile. But then they're investing, they're buying back their own stock. And Amazon stock this year, I believe I saw a stat, was more volatile than Bitcoin over the last 90 days. And so like it it's it's funny that Bitcoin is also still, you know, you're still seeing upside with it, but the volatility is going down, especially and we're in an era now where uh uh securities are also volatile. So um and they're and they're not performing well. So this is makes Bitcoin more and more attractive and I believe will eventually get to a point where even those that have already come around to Bitcoin but don't have the courage to implement it themselves for their company, you know, beyond their own personal lives, they're going to be forced to. Um, and that's the the sellers's point, like people find Bitcoin when they have to. And so it it looks like that stat is showing us that these companies very soon will have to. Yeah, it's like 2017 called they they want their line back. The volatility thing is just so tiresome. Um, first of all, Bitcoin has more positive volatility than negative volatility. So, there's more positively skewed days. So, the returns are if you look at the distribution curve of Bitcoin and perhaps gold might be this as well, there's more positive skew, meaning more days of volatility to the upside than downside. Whereas with equities and bonds, it's the opposite. there's more of a negative skew. So this environment of several past decades of modern portfolio theory and 60/40 portfolio, they associate volatility with being an inherently bad thing because the traditional assets that we have invested in in a meaningful way have more downside volatility. So when you introduce something like Bitcoin, there's more upside volatility to the asset class. That's a good thing. I mean, volatility is an opportunity. If you're strategic as a company and you're sitting on a stockpile of cash, you can strategically deploy that cash into Bitcoin and take advantage of the downside volatility and enjoy the upside volatility, right? So, I think there's just like a lack of critical thinking or maybe it is just the human nature to not want to go against the grain or against the herd and wait for more people to step out and push the frontier forward before entering this what's still perceived to be risky asset class because of its volatility. But for the reasons we just talked about, that doesn't make it a risky asset. It's good. It's just like it's it's ridiculous. Absolutely. I agree completely. And then we'll just also add that like as soon as you adjust your time preference beyond the scope of like three, four, five years, even four years, you know, Bitcoin's never had a negative return over I I think even three years. So as soon as you adjust your time preference beyond three years, then the volatility doesn't matter. So yeah. Can you speak at all to just one one thing you mentioned I think is interesting is the votes are concentrated with the largest asset managers, right? And so how does that relate to a strategy of shareholder activism where maybe there's only so much you can do to move the needle by going to a company directly versus trying to partner or collaborate with the largest shareholders, Black Rockck, Vanguard, to push things forward. I mean, I know it seems that Larry Frink, who was a very staunch critic of Bitcoin 5 years ago, is now in favor of Bitcoin. Who's to say how much he understands it? I I don't know. It honestly doesn't even matter. But he's in the business of making money. And their firm had the most successful ETF of all time last year with IBIT. And so he sees this while it's still a small percentage of their revenue, it's a growing percentage of their revenue. And so I'm just curious like how do you think about from Stripe's perspective working with these large shareholders to push forward a Bitcoin treasury strategy rather than trying to go direct? Well, I wouldn't say working with them. Like first of all, you have to remember that Black Rockck voted against that Microsoft proposal. So they might be right like so there's a there's a disconnect between the investment stewardship departments at some of these asset managers and then how they behave outside of those investment stewardship departments. What I'm very proud of at Strive is that we don't have that disconnect. Um you know we actually practice what we preach which is why we're becoming a Bitcoin treasury company and why we vote consistently with that. Um, I think that that's what gives us the edge and why corporate governance is something that matters. If you have a pro-shareholder, pro- fiduciary corporate governance and you're the only asset manager that does that, then you're going to attract clients because you because you do that and because that will make a difference in the way that companies are run. Um, and so I I believe that Strive has, you know, a positive future ahead of it also with his asset management business. Understood. Yeah, I guess it's less about collaborating, but it's more so just recognizing that these companies do have majority in many cases majority of the voting interest. And so it's like there's a lot of opportunity for you guys to go direct and and push things forward, but it seems like to some extent, at least for some companies you want to work with, these other firms need to be on board, right? Well, I spoke I spoke with Black Rockck about the Microsoft proposal back in November and they sounded just like Microsoft. They sounded like uh like well the company says it's volatile. It's like okay now you trust the company but when you push these other ESG stuff on them like then it's then you don't trust the company. So, it seems like uh Black Rockck has their own agenda and they're just going to do what they do. Um, and that's not within our control. We're just going to make the best pitch possible that we can for Bitcoin and we believe that eventually more people than not will see it. Makes sense. Yeah. Well, um, there's been a lot of Bitcoin treasury companies that have been launched and announced and so I'd be curious, uh, Tim, I would welcome your thoughts on this topic as well. But what do you both just make of this? Um, so Ethan, you mentioned Strive uh becoming or is, however you want to categorize it, Bitcoin asset management company. Then you have um other firms that have been announced and launched in the past couple weeks. I think of uh 21 with uh Jack and Tether and Caner. And so there seems to be more competition entering the space from a pure play Bitcoin treasury company or a pure play Bitcoin asset management company. So this is a space that I don't follow as closely and I would really enjoy to hear from either one of you just your thoughts as this landscape evolves and more players enter the space. How do you think about the competitive environment? you want to go first then? Sure. Um, I mean, I think it's certainly a net positive to have additional entrance in the space. I mean, Michael Sailor has said there's room for dozens of uh companies to be uh leverage Bitcoin equities or whatever term you want to use to to really describe the micro strategy playbook of engaging with the capital markets to sell additional shares, issue debt, issue preferred shares. um use these different strategies to really tap these different pools of capital to build Bitcoin on the balance sheet. Um certainly some of these companies are going to thrive. Some of them are going to be okay. some of them are going to make some strategic mistakes whether it's a leverage ratio or um just going down some other path that um or or in my view making it more complicated than it needs to be. Um I don't think that you need to follow one strategy to a tea and not have any outside or critical thinking of your own involved in it. But um it's very obvious now that strategy is the gold standard of doing things in a measured, thoughtful, constructive but uh in a way that gains scale and is innovative. I mean, part of the talks in Orlando walk through how the strategy team used the deep research function of AI to come up with these preferred products. I mean, talk about shaving years off of iterating ideas. That's that's really interesting and and forwardlooking to just use use all this technology. Um, but you know, will some of these companies outperform on a certain time frame the strategies of the world? Sure. Will some of them crash and burn? Sure. That's why none of this is ever financial advice. But, um, you know, for the longest time, and by longest time, I mean the last seven months since I started the Bitcoin Treasuries pod, it's really at least, and I focus on this a lot, right? I like wake up in the morning, talk about Bitcoin, go to sleep. That's pretty much my life. And really the household names have been Micro Strategy, now Strategy, Semar Scientific, and Metaplanet. And there have been others, but not in a way that's like a household name. So, I think it's a super interesting time. Um, I mean, there's only ever going to be a company like 21 that comes to market with Caner, Tether, and Soft Bank all being involved. That's only going to happen once in like humanity, at least for the United States. I mean, those are just such massive and unique organizations that we could spend an hour just talking about that project. Um, and then you have other um, names in the industry, right, with Nakamoto, with David Bailey. I mean, he literally coordinated orange pilling President Trump. Like, it doesn't get much better than that as far as uh, leaders in the industry that are coming to market with some of these projects. So, um I think it's going to be super interesting to see how it all develops on so many fronts, not just the regulatory aspects that we've focused on a lot over the past year for all the obvious reasons, but from a marketing standpoint, right? Like you can double down on the capital side of it, but are you going to double down on the culture side of it and the social side of it? Um because strategy is just leading the way and and put the numbers aside. I mean if you look on social media over the past week, they have podcasters and influencers in their offices playing pool, drinking beer, interviewing the CEO. I mean that's being innovative and that's connecting with um I mean last night on True North Ellie Doer join joined us and he said you know he said I see people in the chat right now on this live stream that are strategy employees. He said I know for a fact that strategy employees watch true north videos as part of their training. I mean, it's really this confluence of really bringing together your employees in the case of strategy, their investors, um, and just really the community at large, like putting that out there and not dismissing traditional media, but not relying on only traditional media, right? we have all this new media and we could go down the list because a lot of what I've been posting about over the past week is like one meme a day, one podcast a day, uh you know, one event every month, one conference a year. I mean, yeah, is I I just think we're entering this whole new world where not every company needs to um you know, do all of these things, but I think if people are not thoughtful about embracing what Ethan's talking about on the AI front and the Bitcoin front and and wherever all this technology is going, not for technology's sake, but for productivity sake, for the shareholders, for for everyone that's a stakeholder in these in these firms and these projects and these companies. We need especially on the Bitcoin Treasury company front. You know, I I really think there's going to be a lot of positions like a director of Bitcoin, but I think you're going to see like a Bitcoin treasury strategist, which is maybe just a different name for investor relations and community outreach. But my one takeaway from Orlando and being invited to the speakers dinner with Fong and Sailor and and all the speakers on the last night is, you know, it's a small room, but you still have four tables with 30 or 40 some people there. We need the next level of leadership in the Bitcoin space, specifically in the Bitcoin treasury space. I mean, it's going to get to the point where it's not scalable that any company that wants to pursue this strategy is going to be able to get on a call with Dylan or Sailor, right? like it's just not really scalable and there's great service providers that are coming into the space to to help with that. But I think you're going to see a Bitcoin treasury strategist at every Bitcoin Treasury company and they're going to be really engaging in the traditional media and on the social side in addition to I mean this is all kind of investor relations and and community outreach. You're going to see a director of Bitcoin strategy similar to like a Dylan. And then you're going to see an executive like a Fong Lee or a sailor, right? A CEO, a CFO, a CIO, a chairman, an executive chairman that they're really, you know, doing a lot, but one of their primary functions is exactly what Sailor has been doing for half a decade, believe it or not, right? It's almost like, wow, five years is half a decade, and he's been just pounding the table on Bitcoin, the Bitcoin story. managing his Twitter account at doing phone calls. I mean, that's a full-time job. Uh, so I just think this entire ecosystem is um at this really interesting inflection point. Tim, you're you're an excellent case study, too. I mean, you just launched the podcast in October, November. I forget the story. You told me one time, but you just kind of like did it, right? and you didn't even have an expectation of making a business or career out of it. You just did the podcast for some reason, I forget. And then whatever it is, nine months later, maybe not even, you're on stage with Michael Sailor at the conference. I mean, what is that like? What is that? What is that a lesson for people listening there? Because people want to get involved in the space. Yeah. People think it that it's uh that it's just kind of like a funny saying or a meme that you can just do things or it's just a meme, but like the reality is Ellie Doer um created digital art that had Michael Sailor wearing an orange tie and then Michael Sailor wore an orange tie on CNBC and then Ryan and Jeff and myself saw that and I was actually pretty upset because they came out with their Men in Orange or whatever episode of Quant Bros. the day that I put on the orange tie in the studio, which was October 5th. Not that I'm keeping track or anything, but so like Sailor wore like Ellie Doer literally created a meme, then Sailor wore an orange tie, then Ryan and Jeff wore an orange tie, and then I wore an orange tie. So, I'm like fourth. Uh, unless you want to count digital sailor, maybe I'm fifth to wear an orange tie. But this all is part of that social aspect that um you know Eric Semiler has has talked about he as an activist investor, as an LP, he doesn't really he kind of shies away from companies that are like a little too bombastic, right? A little too showy. And I totally understand that from that activist or investor LP standpoint, but look at what Michael Sailor is doing. It doesn't have to be. It's not necessarily showy. It's just putting a spotlight on Bitcoin. And I think just all this is so unique because Bitcoin is a commodity. So you can talk about Bitcoin all day long, right? Senators and Congress people can talk about Bitcoin because it's a commodity. It's not a security. Um, so like when you pair that with a equity, right, and there's regulations out there that you shouldn't be out there like necessarily like promoting and and trying to pump your stock, but uh, Bitcoin is just this interesting commodity when when you can put it into all these different rappers. And um you know I think I share some other people prominent people's views in the space that I'm surprised there are not more structured products on top of Bitcoin yet. Um they're coming right you see all these products that I mean that's just a nice clean wrapper that people are like oh right whether it's a product like a preferred product from strategy or it's some sort of ETF product. I mean, these are all doorways into Bitcoin. Like, I'll just speak for myself. I don't really care how people get to Bitcoin. I just want them to get there and and and really accelerate that story. And I I'm I'm pretty positive on Bitcoin Treasury companies and nation state adoption being able to, you know, is I think it's going to feel like you're pulling the future forward a little bit. um even though the reality will probably be closer to you know sailor's forecast of 30 to 60% appreciation a year for the next you know 21 years. All right, just a quick break. Have your friends and family ever made fun of you about Bitcoin? They probably have. Or maybe they just dismiss you every time you bring it up. But perhaps that is changing with Bitcoin again crossing 100K and potentially going much higher this year. not financial advice. Of course, your friends and family might actually need a secure place to buy Bitcoin. And so that's where On-Ramp Trade comes into play. It is our latest account tier. It's purpose-built for secure long-term Bitcoin accumulation. You can see here on the screen what you get there. If you're listening on video, you get low fees. 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You want to talk to Michael, you want to hear Michael yell. So book a consultation online or just sign up on our website. Enjoy the rest of the episode for for both of you. I'm curious like looking through the rest of the year. So it's miday when we're recording. Tim, you mentioned structure products. So maybe my umbrella question would be just thoughts on adoption or announcements. So adoption of Bitcoin within corporate treasuries is let's say just like vanilla strategy starting to move some cash or some T bills and park it in Bitcoin to just buffer the balance sheet, grow the the company. The next piece would be pure play companies. So, we saw a few that have been announced. Tim, you mentioned Nakamoto. I totally forgot about that one. Um, 21 thoughts on more pure play companies entering the space. And then structured products. I mean, I hear of all these structured products. I actually have not spent much time learning about them just yet, but to my understanding, there's only a few that exist. I mean, ETFs aside, let's talk about like, you know, strategy uh products, Tim, that you probably know better. What are your thoughts just in terms of the remainder of this year where we see the most growth? Is it pure play companies? Is it vanilla? Are there more structured products announced? Just like tell me what what excites you guys and where do you where are you paying attention? Yeah, I think that the first of all, Strike and Strife are very unique products and I think that there are going to be more similar products coming from Strategy and others as this space grows. Bitcoin is really becoming an asset class uh not just an asset. Um you have ETFs, you have Bitcoin treasury companies. I think that there's going to be different kinds of Bitcoin treasury companies, pure play ones, you know, micro strategy copies, companies that do things more innovative than strategy and take it to the next level. You're going to have companies that just use Bitcoin as a hedge against inflation like a Tesla. Um there's going to be all different kinds of ways to gain exposure to Bitcoin. And I think that that's a good thing. It's not that not just that it's a good thing. If you look back and you think about, you know, what would the game theory look like of Bitcoin becoming the money of the world? Like it would have to happen in steps. It would have to infiltrate, you know, a little bit of governments, a little bit of corporations, some, you know, retail. Some countries are going to start using it where they don't have a stable currency. and it's just going to take time. Um, and so I think that these are the first iterations of that happening. That's what I believe is going on. Uh, and so there's going to be a lot of different products and corporate approaches and nation state approaches, whether it's just buying Bitcoin, whether it's uh, you know, buying Bitcoin and dips, dollar cost averaging, mining Bitcoin, trading in Bitcoin, Stake and Shake is now accepting Bitcoin. Uh there's a there's a lot of different ways. Yeah. When I uh posted a few days ago, I said, "What what Bitcoin treasury company should I consider going to work for?" One of the comments was Steak and Shake. And I I was on a phone call with a guy and I said, you know, I like stakes and I like shakes, so maybe that's the play. But um yeah, I there's just this proliferation of companies and products. I think we'll see more of that as the year goes on and I think as you see you call them the micro strategy copycats um continuing to iterate that playbook meaning just or just follow that playbook um not just on the equity and the debt but the preferred I think that is a huge unlock because you know when you have products that have an 8% coupon with upside to convert version of the equity or you have a preferred product that's just a 10% perpetual yield forever. How many people are buying rental properties just trying to get 10%. They're doing all that work. And that's an example that Fong uh used during the one talk in Orlando. It's like, yeah, when the word hits the street and people actually like start to understand and and and there's an awareness level of these products, I think that, you know, to Ethan's point, that's why they're so unique and and even just these pools of capital in the fixed income space. If the best product prior to strategy launching, a preferred stock was giving you 600 basis points and you can get 800 basis points. I mean, the math maths. So, I I think we're at a really interesting time to see um all of these markets being built and uh Jeff Walton actually did a great job last night on the True North call kind of talking about um creating a market. when he was in the reinsurance industry, he literally flew to London, flew to New York, flew to Bermuda, had 30 to 50 meetings, had one person say yes, and he like literally created a market for a product. Um, but it's it's a slow start. So, like he he told that story, then he went back the next year, did the same meetings, New York, London, Bermuda, and got four people to sign up. So, it's like I think I'm I'm mentioning it because I'm guilty of it as much as maybe some other people of like, okay, well, you launched this ticker. Uh, one of them has an ATM facility on it. Why aren't you cranking out a billion dollars a week of Bitcoin buys from it, right? What's taking so long? We live in this like attention society and add society of like, well, it's digital. Like, I just sent a tweet and now it's done. Why can't you do the same at the capital markets? And it's not going to take forever. It might not even take that long, but it, you know, it might take a few months or quarters or or a year to really ramp up from zero from like not even an idea to hundreds of millions or billions of dollars a week worth of capital out of these markets. I mean, it's happening fast, but um again, I think I'm as guilty as the next person of like, why isn't it happening faster? And so, some of those stories I think are really helpful. Yeah. from my vantage point because I don't follow the strategy space as closely as the two of you do just one day these products existed I guess I didn't I don't know how much of the development of the products was actually done in public to maybe you could um expand a bit further on that but I just logged in on X one day which I'm even trying to be on X even less so uh anyways I just log in one day and these products exist right and so then I'm like oh well now I need to spend a little bit time to learn about But it's remarkable just how technology allowed for just the rapid acceleration of creating new financial products, structured products and um I guess it was Sailor and Fong, right, talking about how they just used AI to essentially design most of these new products. So I don't know like Tim from your vantage point was there um was there any public awareness about these being developed or just one day there was an announcement of the products and um do go ahead on that first. Yeah there there was no public awareness until they were launched. Um, but it was just super cool to have executives opening up and and kind of letting you peer behind the curtain and speaking to that process of, hey, we we we iterated on deep research and then once right they had amalgamated all this information, then they put it in front of their legal team and said, "Okay, this is what we want to do. Here's all the information. Go make it happen." Right? which started the process of the legal team telling them why they couldn't do it. So, but yeah, just the the transparency and again the probably also speaks to the cooperative competition, right? I mean, Bitcoin has a finite supply. It's the only game that I'm aware of where um everybody is kind of right. You're buying some Bitcoin. I'm buying some Bitcoin. And at some point, uh, if there's more buyers and sellers, the price is going to go up. So, it's a it's a unique space. Yeah. No, certainly is. Um, I know we're coming up on time. Ethan, I wanted to just hear a little bit more about uh before we wrap up a little bit more about Dell. And so it's interesting because when I read about the news at some point the past couple days, the way it was framed at least online by people or their perception of it was this is a positive thing. Like you know the shareholders don't need to vote on it. But you obviously have a far more knowledgeable take and nuance take. So I'm curious like what do you actually make of this decision to you know to bypass a vote and you just like how can you break that down for us? Yeah, it's not a positive thing. Um, but which is hilarious because like everyone's like all fired up about it and it's like what but I do think it's something we're going to recover from. So when I first submitted these proposals um and they were basically the same from one company to the next. I was very careful in the way that I worded it. I I remember when when people first saw the Microsoft proposal, they were like, "Oh, this is lame. It's not even asking them to buy Bitcoin. It's asking them to do a report analyzing if they should buy Bitcoin." And the reason I did that was because I thought even this might not make it past the SEC because the SEC is so biased against shareholders. Sometimes for good reason because you don't want a situation which a small group of activist shareholders can completely change a company. You know what I mean? So there has to be some protection in place for companies against you know bad acting shareholders. That being said, you have a biased SEC. Yes, it's changing. Um, yes, it's more pro Bitcoin than it was before, but it's not that quick to change. And a lot of these processes to evaluate these proposals started before Trump took office. And so, I think that in the future, you're going to see a more friendly SEC that's not going to discriminate so hard against proposals. That being said, once you set a precedent at one of these companies that um which is why I was so careful in the first place, uh and I was as careful as I could be, but that wasn't good enough. You had now the SEC decide this proposal cannot be voted on. And so if you submit the same proposal now to another company, they're just going to say, "Hey, look, there's precedent at Dell to leave this off the ballot." And so what we're I'm going to have to do and we're going to have to do at Strive is we're going to have to reword these proposals in different ways more broadly um that addresses things perhaps beyond just the Treasury strategy. Um and I believe that with a more friendly SEC and different worded proposals, we'll be able to get these proposals in front of companies. But it is a small setback that so if I'm being honest with you, but these exactly the same setbacks that I had with DEI going back to 2021, the SEC voted against a lot of our proposals um and a lot of companies or you know my former employer a lot of my proposals that I submitted and as the time changed as as the SEC became more aware that there are risks the shareholder the shareholders and the companies for implementing a DEI process. They became a little bit more lenient especially after that Supreme Court ruling um SFFA. Um and so I think the same thing is going to happen here. Now we have a strategic Bitcoin reserve that's a federal you know policy. So if the federal government policy is, yeah, let's, you know, let's stack Bitcoin, but the SEC is saying that, you know, shareholders can't ask corporations to do that as well, that changes the game. These decision at Dell um actually started first at Amazon prior to the strategic Bitcoin reserve and then for the sake of consistency, the SEC has to be give the same ruling at Dell as well. So, um, small setback, but I think we're going to recover and there still will be a lot of shareholder engagement with corporations regarding Bitcoin and Bitcoin in their balance sheet. Yeah, appreciate you breaking that down. It's just uh it's funny because you mentioned it earlier in the show about it being not a good thing, but then when I logged into X earlier this week, everyone's all fired up because their perception, I guess, is, oh, they're just going to do it now. They don't need to, you know, they don't need to ask for permission. But it's, I guess, reality. Yeah, but it's um a little bit more nuance as you just broke down. So to wrap things up here, um one more thing on that on that front though. Yeah. Yeah. There is still a proposal at Meta. So um that one will be on the ballot, so look out for that. Oh, nice. Can you uh when is that? You guys will see. I don't want to share too. Yeah. Cool. Um so to wrap things up then I wanted to just touch on something. Give me give me something bullish. Give me something to fire some people up because we just talked on Well, so Meta is exciting, so we'll keep an eye on that. But um Dell maybe not so much. You said earlier in the show that the Bitcoin Treasury adoption uh is accelerating or happening faster than the DEI stuff kind of came to a halt. So there's probably a lot of bullish things going on, some of which you can't share, but what could you share? Um Ethan and then Tim, want to hear your your quick thoughts as well. Just what what are you guys excited about? give the audience something to be fired up about as we close out this episode. Yeah, I just the fact that we've seen, you know, so many new Bitcoin Treasury companies just in the last announce just in the last month and there's going to be a lot more I believe in the coming months and I think that we're at the stage in the the happening cycle where we're at the beginning of a bull market. Um, I'm just very excited about the direction that Bitcoin's going in and both in terms of, you know, number go up and and in terms of just general adoption. Uh, I I'm I'm very bullish about um the next year and I think that we're going to keep seeing good news. Yeah. I mean from strategy having 40 billion or more of Bitcoin on their balance sheet uh and they started with converting their cash $250 million into Bitcoin just 5 years ago to now seeing other entrance um with from public filings um looking to enter the market with you know five six 700 million to start or with like 21, right? 40 42,000 Bitcoin to start. What's that? 4 billion some dollars. I mean, um, these are numbers that if you just extrapolate that out over the next couple quarters, uh, if you have fast followers or you just have a couple of companies that continue to iterate, um, I think it's for me it looks like the writing's on the wall that between Bitcoin being decentralized and AI and technology just pulling ing us forward faster and faster that the uh the guys and gals that are really leading from the front um are speeding up. They're not slowing down and super bullish on that. Yeah, when you frame it that way, Tim, it's pretty wild, huh? Two 250 million to $40 billion war chest and just getting started. Well, awesome stuff. Uh appreciate both of your time. Um, Ethan, anywhere you want to hand off folks to just learn more about either your work or Strive as a whole? I would say go to strive.com, check out our recent rec recent uh depth that we published and on on becoming a Bitcoin treasury company and then uh yeah, stay tuned for for more announcements from us and uh you know, check out Strive on Twitter, check out Matt on his podcast with Tim and uh yeah, good things coming, good things to check out. Awesome. And Tim, how about you? You have how many podcasts these days? Where do you want people to go? Uh you can just search on YouTube for Bitcoin treasuries. You can search on YouTube for scarce assets, the last trade. Uh I already said Bitcoin treasuries, the hurdle rate, MSTR true north. I think that's it for now. Maybe four or five. Tim is the crown for most Bitcoin podcasts. And you're just getting started. I hope uh I hope we're at a dozen by the end of this year, Tim. We're going higher. 21 podcasts. Yeah, there we go. Now we're talking. Well, gentlemen, thank you. Appreciate both of your time. Good chat. Thank you. Thanks, guys. Thanks for listening to this week's episode of the show. If you found the information valuable, please share the episode with a friend or leave a rating on your favorite podcast app. All the links we discussed in today's show will be in the show notes inside your podcast app. Before we finish, a quick reminder that Onra Media is forformational and entertainment purposes only, and nothing should be construed as investment or legal advice. Regardless of where you are on your Bitcoin journey, we'd love to hear from you.