Long Chaos, Short Trust: Bitcoin is the Modern Safe Haven

[Music] It all comes down to computers communicating. The information superighway can be a confusing mix of on-ramps and off-ramps. Bitcoin is worthless artificial gold. Is it still rat poison? Probably rat poison squared. We need to get into the world of okay, this is actually foundational technology. What the internet of money does is it creates a single network which can do a microtransaction to a gigat transaction. The internet is going to be one of the major forces for reducing the roll of gun. The one thing that's missing but that will soon be developed is a reliable ecash. Alrighty, gentlemen. Welcome back to another episode of Final Settlement. Today is Monday, June 16th. How are we doing, gentlemen? A little bit of volatility in these markets the past few days. I think we called it a few weeks ago. We're just going to be long volatility for for a while now. Long chaos. Long chaos. Um yeah, so I'm going to pull up just the price chart here momentarily so we can take a look about, you know, around what happened last week as um some geopolitical turmoil kicked off at the end of last week prompting uh Bitcoin to slide a bit all the way down to around 103. And uh you know, we've seen this story before. We've seen Bitcoin react um in a volatile manner to geopolitical events uh whether it's war um sanctions uh COVID back in the day. Um but typically, you know, Bitcoin uh recovers faster than other assets. So, you can see we're already back over 107. Um and I'm going to pull up a chart from uh from BlackRock as well, which shows some of this data. Um, but as I'm pulling that up, any thoughts on on the events of last week and and how Bitcoin reacted just being a 24/7 365 market? Um, you know, I think when things really started kicking off, it was uh maybe 8 or 900 p.m. in the evening. So, rest of markets were closed. Um, and people react and and express their views via Bitcoin typically. Yeah. I mean, seems pretty resilient. I think um I think the old adage that goes that you know all news in a any news in a bare market um doesn't matter positive or negative you're going to still see that trend downwards and the same thing in a bull market if you get negative news you're going to um it doesn't really impact it materially and it's pretty wild because I think this most recent escalation is probably the most serious given what's happening and a lot of the additional things that have come out since the first attacks Um and it's pretty crazy to see it resil like the resilience sitting at 107K um this morning. So those are initial initial thoughts. It didn't even Yeah. And it didn't even really drop that far in in context sort of respect to um some of these past events um on the table here. You know, I think it was at like 108 went down to 103. Like that's not you know in in the context of Bitcoin's volatility that's not that aggressive of a move. Um but yeah, to your point, already already sort of rebounded. Um but uh this is a great chart from Black Rockck. I think uh we're going to update this. Um one, it needs to have this data for Liberation Day and now this latest uh geopolitical event. But this is just a good sort of tracker to look uh 10 and 60 days out after these these types of events and how well Bitcoin performs relative to uh equities and gold. We could probably add a few other asset classes to this as well and make it more comprehensive. Yeah. Um I mean Bitcoin's the most liquid out of all those, especially trading on the weekend. So I think if you're a macroevent driven trading firm, like adding Bitcoin is just like necessary in order to, you know, be able to express your views faster than anything else. Just given how quickly the world is ultimately moving in the flow of news. It's just um the a good thing to have in your portfolio in order to be able to express your views. Um it's seeming like more and more of these attacks, especially maybe it's just the timing of them because they're overseas in in a different part of the world, but they always seem to happen whenever markets are closed here in the US. And so, um you know, obviously Bitcoin's going to sell off, but you know, no other markets are open because you you sell what you can, not uh when when these things kind of happen. And so, um, yeah, I mean, it's Bitcoin will will recover, um, when there inevitably is a little bit more liquidity that comes back into the situation. I think that I'm not a geopolitical expert on this conflict, but um, we we'll see what happens. Uh I mean yeah I think I think um what's kind of bullish is I mean just bullish for the price is that I is going to sound crazy but like what happened was kind of priced in already in the sense of this whole notion of going to a multipolar world from a unipolar world and trade starting to break down and the the dollar breaking down from the reserve currency and how um efficient commerce globally is going to like happen in the future. I think that's where this gold pump and then Bitcoin's natural pump and the understanding of sovereigns starting to accumulate. Um and so I think that's where we see this like price it's like well if the world is heading to a chaotic place and um volatility is going to ensue counterparty risk is going to ensue and you don't know who you can trust and you have to settle in neutral currencies well why would bitcoin go down if this is already understood by enough sovereigns and enough individuals um and so I think this is where it ties into you know a little bit of sailors of I forget what quote or tweet I actually listened to it a few times And it's interesting because last week I guess he came out talking about like bare markets and the price you know will like go to a million and then it it sounded like initially I think what people quoted that it's going to go back to 200k but he was referencing it's going to dip 200k if you listen to it carefully. So it's saying like it's only going to dip 20%. And I think that's kind of the sentiment and the theme we've been talking about is there's just like a different structure of what's happening. It's understood now. And I think this last part I know we're going to talk about it later. I think probably and I know I get a lot of for this, but like stable coins are probably the most bullish thing for Bitcoin um by far because of just the liquidity that comes in the system and and then just the natural market knowledge that people will know that a unit's digitized especially when you think about like Amazon, Walmart and all these other people getting in because they buy trust and people have trust in these large firms. they don't have trust with a Kraken or a Gemini uh and then maybe a little bit with a Coinbase, but like when you already interact with them and you already have your linking of dollar like it just changes the whole dynamic around all this and I don't think we fully appreciate it yet. I think that's a great point. Um in in just the sense that it normalizes this entire industry to an extent, right? Like and it's the perfect sort of gateway drug to going down the path and understanding Bitcoin and sound money. It's like, well, if you can trust these digital dollars that are running on quote unquote crypto rails, um it just becomes much more normalized in the sort of public zeitgeist that um you know, Bitcoin is a real thing. It's here to stay. Uh we're going to use digital dollars as well. And so, yeah, I totally agree that that is sort of um underappreciated right now. Uh but maybe with that, we can jump into some deals of the week. Lots of deals, lots of news items. I'm just going to pull up the uh early riders open range newsletter from Sunday. Uh and then we can jump into any of the things here. Um we had Stripe agreeing to acquire crypto wallet infrastructure provider Privy uh undisclosed price. Uh Coinbase unveiled their Coinbase One card, uh promising 4% Bitcoin back on every purchase. Now, there's some fine print on that one. Um, basically you can only get the full 4% if you're holding all your assets on Coinbase, I think is the stipulation, and then it scales back to, I think, 2% if uh you're not holding your assets on Coinbase. Um, but still a pretty compelling product. I think uh Gemini was first to market with a similar uh credit card offering Bitcoin rewards a few months ago. Uh, but would expect to see more of these types of products. um people want to earn Bitcoin um and they're already spending a lot on on credit cards and on on credit in general. Um so it just makes sense. There's a lot of product market fit there. Um Coinbase also confirmed plans to introduce uh perpetual futures markets for US traders. That's been something that they've wanted to do for a long time. Uh but there was always um sort of regulatory push back on PERS and that's why they sort of predominantly existed offshore. um Binance as sort of the main hub for those historically as well as some um sort of dexes decentralized platforms that allow people to to access per. Um can we uh show should we touch on a few Yeah, I think um two initial comments on the Coinbase one. I think this was always going to happen and I I think the I've u had the sentiment for a while now that the existing Bitcoin companies that focus on these sectors when the big boys finally came in here were just going to completely crush market share and opportunity. Um Coinbase is a great example of their distribution and uh American Express being a blue chip. But not only that, from the cohort, if you think about it, the traditional person that's stacking sets with some of these like cards in the first 10 years of Bitcoin's history are some of the segments you just naturally don't want. Very price reverse. They're not really, you know, spending a lot. They're not going in debt. They're holding BTC. And so American Express has that like, you know, from a cohort, Uni Economics, and then Coinbase. Um, and it's actually really interesting. Honeypot or not honeypot, I'd say like monkeys paw to get them to hold assets there because you just basically vertically integrate that. Um, I'll pause there and curious your thoughts before and then we could talk about the privy deal because I think that's super interesting as well. Yeah, Coinbase has packaged this in a very nice way. It's just like the card looks great honestly and uh, you know, most people are just going to, you know, use Coinbase because they have a good user interface and so it just makes a ton of sense. Um, yeah. Yeah. But 4% is is amazing when you hear it like two. It's great marketing because it is 2%. But you have to read in the fine print and people just like screw it. Four, two, whatever. I'm in. Yeah. Yeah. You also have to pay some sort of annual fee to my understanding. And so like that's, you know, inside of, you know, what actually you get back. But, um, it's, have you guys really looked into the, uh, why it's holding 2% versus 4% on on Coinbase? I haven't been able to to dig in there yet. Well, it's No, I think it's just it's just to to to get some some amount of lock in to keep assets on the platform. That would be the thought. Well, yeah, because the idea is it's like um I looked in I didn't look exactly, but basically there's a delta and that 2% spread that they passed back that they're either they've run the numbers or the bet is that they will um getting close to those assets holding like stable coins, crypto or BTC, you're going to trade it more, you're going to take loans out and so you're you're effectively uh it's similar to like you know JP Morgan Chase. If you're going to give a check in, you're going to give a credit card, you're going to monetize a relationship in multiple ways is I believe the core angle there. Yeah. And then there was also um this from Coinbase uh that Shopify will enable USDC stable coins on base which is Coinbase's uh Ethereum L2 in checkout and shopify payments in shop pay. Um so again just more sort of integration of stable coins into the traditional economy normalizing these things. Um and then what was the other one we wanted to go to? So yeah. So maybe we we could stay here because I think this is a real good um example again going back to the credit card um opportunity is that we haven't historically seen not only big players in traditional tech. um think about their network effects and distribution come into the digital asset space. So I think this is why this is bullish BTC. I think it's also bullish opportunities because we naturally know whether it's you know the Vanex and Fidelities of the world they're focused on Salana ETFs and while they have a Bitcoin focus it's just that you naturally know when building a business if you don't have a singular focus i.e. Coinbase, you're going to miss a lot of things. Um, and there's opportunity cost. And similar here, I think it's directionally the right move. And it's interesting that so Shopify um previously had purchased um uh shop, I think it's shop.com. And so shop was uh an application that you could download. a lot of DTOC consumers used it or uh um uh DTOC like sellers, merchants used it. And so you can basically aggregate all of your um the things you were purchasing and then you could see it and you could go back in to see when they were shipping and you could buy more. And so if you transition to the to the privy news, it's interesting because it looks like um Stripe is doing a similar play where Stripe initially acquired the distribution mechanism for stable coins with Bridge and then they just recently purchased this wallet provider Privy which my understanding is they create uh they have infrastructure for other wallets to build in um stable coins and crypto assets. So you can see how they can build that kind of like full loop where they can give other merchants the ability to embed uh digital wallets or stable coins into their uh merchant application and then pay through Stripe invoices backwards and forwards and they have it in a singular app. Um so they may even launch their own app as well as give this infrastructure to others. And so it's just a really interesting um you know the Collison brothers are super savvy in looking at it from an angle of uh just like you know they're R&D this stuff. I think they've been working on this for years now. It's not like they went and hired McKenzie to do a study on what stable coins are and then are trying to figure it out. It's like they've already like mapped out the flow of funds. And so anyway, long story short, I think this is super fascinating. And I think it's going to be a large distribution mechanism. But I still think the missing piece as we know is the Bitcoin component and allowing people to go between stables, Bitcoin, and how they're going to naturally manage capital, especially when a lot of these merchants are going to start to realize if we all have realized that we want to accept Bitcoin. And that's where there's opportunities to invest in the space is to create the right infrastructure that I do think stable coins are going to be a big part, but also you're going to naturally want Bitcoin next to it. Yeah. No, I totally agree. and and the point you made around sort of the timing or the timelines of all of this in in the in the sense that you know a lot of these more traditional tech companies have been around the hoop and thinking about these types of things for a while. I think it just speaks to um the stark difference in regulatory environment as you know the Trump administration came in was very favorable and so now you know they have air cover to do all these things and everyone's sort of getting their chips on the table. um you know, the stable coin act looks like it's it's going to go through and and so um now they kind of have that air cover to do all these things that they've probably been thinking about for for multiple years to your point. 100%. And it's interesting to see on the Coinbase side too, um they had their state of the crypto summit and they mentioned, you know, Bitcoin 62 times. They mentioned Ethereum and Salana once or twice, but it was mostly, you know, they they mentioned crypto a lot, but a lot of it was just their uh USDC obviously with the IPO and um you know, just mostly talk about stable coins, etc. Um which seemingly is the shift in the focus of, you know, both Coinbase given the um you know, Bitcoin dominance chart that we're we're continuing to see, as well as, you know, what merchants are actually adopting. And maybe that's just because it was more of a an institutional crowd there as well. But it's interesting to see, you know, a little bit more of a pivot away from, you know, the other tokens that um, you know, retail traders have been focused on in the past to a little bit more um, coming back to Bitcoin as well as stable coins as well. Yeah, that is super interesting. They only mentioned Ethereum and Salana one time each. Um, but I guess that that kind of makes sense. Like I I would imagine the I didn't watch this this summit at all, but I would imagine the the focus was really on on stable coins and uh you know their new card which is related to Bitcoin, so that kind of kind of adds up. These poor ETH guys, man. Um these these poor Cardano guys. Do we want to go there? Cardano is planning to buy Bitcoin. Before going to the Cardano thing, I think one thing you keyed in on is um that like can't be, you know, has to be underscored is around the regulation. I think we see this with RAAS and banks that there were the forward thinking ones that had been R&D for the past couple years and now they've gotten the green light. But I think that also ties into, you know, the most connected individuals are some of the largest companies in the world and Walmart, Amazon, and I forgot whoever else were the larger ones looking at stable coins. um it makes complete sense that they would get involved, but also from a distribution perspective, I think it's probably understood that there's they're not going to be net new stable coin issuers, like from a an emergent one, unless you're kind of tied into whatever Andre is doing because it's like a proxy CBDC or whatever, but uh from a Walmart or an Amazon or a Fidelity, it makes a lot of sense because of your distribution and also your brand and trust because I think that's a thing that we still forget like all these digital assets are super scary and they're, you what do I do with them and do I sell custody the stable coins and what happens if somebody steals my wallet like all these things but you can start to um invest insurance and just a lot of market structure that hadn't historically been there by a startup that will let people get comfortable with these tokens especially if you already have you think about your Amazon Prime application and it's already there and it just gets converted and then it's interoperable like it's going to get really interesting um to see where this goes but I I still can't I don't see it yet but I can't help but feel like whoever figures out the swapping of BTC and also the opportunity around Bitcoin um is going to really reap the rewards and yeah I don't I wonder if like one of the the user experiences is just letting individuals buy for uh you have like toggles where you can let somebody buy for less than market price if they switch for Bitcoin because you're ultimately taking less because all these you know USDC coin they're still going to have to pay some kind of interchange fee and so if you're able to do it via lightning not have the interchange plus you don't have to buy the, you know, if you're going to convert to buy the BTC, that's another fee. And you start to stack that and Bitcoin does its thing while these dollars do the opposite. Like, that's going to be a very interesting dynamic for companies that be able to pull data and show the uh appreciation by just holding the Bitcoin. So, it'll be it's going to be fascinating um to see who kind of plays and does something like that. Yeah. And that that definitely seems to be the trajectory. And like I would even say the the Coinbase one card is a step in that direction, right? like if you are the the the implication there is explicitly you're spending in dollars uh and you're you're saving in Bitcoin whatever that 4% 2 to 4% is um the implication is that you know that's what you're stacking that's what you're aiming to save while you spent your dollars uh or your credit 100%. And the other factor too is just with the constant devaluation of the dollar, all of these firms, whether it's Amazon, Walmart, whoever, they essentially are forced to become financial services firms too of just like you know figuring out how to outperform um you know the dollar because it's continually be devaluating and whether that's you know um just managing the significant costs that are associated with um you know spending at terminals and online to just actually, you know, saving in the best form of money. I think there's just going to be more and more um, you know, interchange in between the two. And so, we're going to only see that ramp up. And I think it's actually going to be um, you know, really investigated by these large firms, too, as they go down the stable coin path a little bit more. They're just going to inevitably learn more about Bitcoin and and why and how all these digital assets work. Yeah, it'll be interesting to see when the market starts to push or leave. um the rewards programs like we know how bad Starbucks is, right? And the float that they able and then like I think they even just had this form of inflation like six or 12 months ago where they just like cut out the the conversion cost or or price but um where people just stopped going there because you offer Bitcoin rewards. It's just so it'll be interesting. Yeah, I'm really looking forward to seeing airlines do that as well. Um, so I mentioned this and we've talked a lot about the Bitcoin Treasury strategies over the past several months and it seems like um, you know, every week there's five to 10 new announcements of some company um, implementing a Bitcoin treasury strategy. This is a bit of a different flavor. Um, Cardano uh is now proposing to convert some of their ADA coin uh into Bitcoin and and stable coins. Um, so is this just a continuation of this um crowded trade of corporates and now crypto entities acquiring Bitcoin? I mean, we saw some of this like if you think back to uh 21 with Teral Luna, it it is it does remind me of that when uh Docoin uh decided to buy Bitcoin for their treasury. Um now that was a little bit more overtly a scam. Um but you know, Cardano has sort of just been languishing for years and uh Charles Hoskinson who's on on the screen now is is arguably one of the the greatest crypto scammers of all time. Um, and so now he is also Bitcoin affinity scamming to some to some extent. Any thoughts? Yeah, I think I think that this is not necessarily something new. I mean, EOS did it very well back in 2017 of just, you know, buying uh or selling a bunch of their token in order to buy Bitcoin. Um, people have been doing this on their personal treasury for longer than since 2017 as well. Uh, I think a lot of these crypto people just inevitably price everything in Bitcoin. um whether they admit it to you know their community or or not. Um and so they they want more Bitcoin and so inevitably uh everybody is going to sell non-core assets whether it's ADA or anything else in order to acquire more Bitcoin in the long term. It should be the hurdle rate for every asset class asset manager um whether personally or as a company. And so, um, you know, we're just going to continue to see this both from ADA as well as, you know, pretty much everyone else that there is. Yeah. I mean, it kind of reminds me of, um, anybody that's like looked in Ethereum, you know, tokconomics or whatever, there was there's always like these unnatural mechanisms to lock up Ethereum to create this like false sense of scare scarcity. There was like Maker Dow, there was naturally like the premine and what individuals like that were doing holding it. um it was kind of like baked into the underlying, right? Like it was always trying to get you to lock up um the float and this just sounds like a different like flavor of that is we're going to um you know we're going to hold Bitcoin, we're going to we're going to hold Bitcoin, let the price appreciate, we're going to buy more uh Cardono and just like you know take it off the market. Um, and then naturally the sad part is retail comes in, they see a price move and they say, "Well, that looks, you know, like it has more opportunity than BTC and they come in and there's just like this is basically the same game that's been happening for a very long time." Um, so yeah, I mean it makes sense like there's no narrative for Cardono like so if they can have the price 10x or whatever because they're buying it off because they have Bitcoin rational move from their perspective if we're being fair about it. Uh it sounds like a Bitcoin treasury company. Like it doesn't it's Yeah. Um in other in other Shitcoin news, uh we've got some movement on the Salana ETF uh front. Maybe maybe Bitcoin dominance is uh is going to come down. Michael, what do you think? You know, I'm trying to think how do we tie this so it's not a cry like it's not a crypto show and how where does this is this relevant or how is it relevant for Bitcoin? Um but yeah, no, I mean I I don't know. Like there's going to be a bunch of ETFs. I think at the end of the day, the market realized um the Trump administration, the the powers that be, they're going to make a bunch of fees from all this stuff. And so there's going to be more ETFs. There's going to be more ETFs with leverage and Salana and whatever staking that's going to allow to get some yield. and and the Bitweises and folks of the world are going to sell raas that you can get passive income on this and they love passive income. Um and so yeah, I think like we're just going to see more of all of it. I think the thing that Yeah, I mean um the one other thing Brian, can you pull up the Gemini chart? Um yeah, that is you know what I see as you know the real Bitcoin dominance here. I think um we we may or may not uh see all these Bitcoin treasury companies become larger than the other altcoins like the Ethereum. I uh I wouldn't be surprised if Micro Strategy is bigger than uh Ethereum later this cycle. Um but yeah, I mean this is a a chart that just uh for the listeners over um 30% of Bitcoin circulating supply is now held by just uh 216 centralized entities uh which are primarily made up of you know exchanges um funds, DeFi smart contracts, public companies, private companies and governments. Um, and you know, given the demand for Bitcoin treasury companies, I I think that's only going to increase. Um, and it's just, uh, not a great trend to see. I think that this is is really the the new Bitcoin dominance is just you know people holding it it it themselves versus um you know just on a centralized exchange or um within some sort of rapper whether it's you know um Bitcoin treasury companies or these uh the governments will will continue to be uh acquiring a little bit more as well. Yeah, there's two key things to talk about. I'm glad you brought this up. What is um ultimately the best analogy I can think of there's probably others we should riff on them over week after week on what are better ones but I think of like pre2000 bubble and Bezos probably sat around and people that sat around like I think um um it could be or Google but like the people that were close to those investments understood what was happening and understood the the buildout and then they saw the pets.com and they saw all these other things and they're like that's funny there's money there there's a why money's flowing there. There's a lot of money in the system. Um, but there's no real signal. And I think about everything we're talking about here today and like the ETFs and the different things that people are going to chase and it's very similar that at the end of the day, anybody listening to this and we know that there's only 21 million of these things and um, you know, Peter Teal quote, if you want to make money, get closest to the money. You want to get closest to the BTC, whether it's like the pay the payment rails or the underlying custodial infrastructure. And in the future, if you do that, you give yourself a really great chance to participate in the financial economy uh for the next hundreds to thousand years. Everything else is basically noise. And it's noise because there's so much money in the system. So nobody has any idea. So we get like we chase the shiny star like the shiny objects and we talk about them. And it's good because it it's a s it's a it's a canary in the coal mine of the sentiment of the market and where it's going and the maturation that people are going to naturally this is a gateway into them saying, "Oh, it was Bitcoin all the whole time." And that's kind of where we focus. It's like, well, how do you this? What's the step function for individuals and other businesses to start creating infrastructure that is ahead of it. So when the market, the next cycle wakes up, it's like, oh, it was Bitcoin the whole time. And and the the key thing I'll call out because a lot of people, it's not obvious until you hear it, but a lot of these crypto firms have no Bitcoin. like maybe they don't hold it on their treasury and they definitely aren't able to really absorb a lot of BTC capital because there's only so much floating around around hedge funds and custodians of like these ETFs and it all sits at Coinbase. So all these crypto firms just have to go further and further on the risk curve. They have to more and more financial products to raise money. Um and similar to like to all these ETFs that come about from Bitwise and others. It's just like Bitwise I think uh if you back into what they paid Open Sense for the grant it was like they made like a million dollars in revenue or something crazy. uh for their ETF last year net of you know fees. Uh and these people just don't make any money around Bitcoin because they don't have any fundamental differentiation in the Bitcoin product outside of Coinbase. And so I think there's just um it's just basically calling out like there's a very large opportunity, but a lot of these larger firms are going to miss it because they're chasing stable coins and crypto and they'll look back and they'll be like, "Oh how do we do it?" And that's really the real opportunity is. Hey everyone, thanks again for tuning in to another episode of Final Settlement. We had a lively conversation uh this morning discussing all things Bitcoin corporate treasury strategies with another one launching this morning as well as just topical things happening in the markets uh from the tariff deals by Trump to the strategies across different corporates and finances bringing in uh financial institutions bringing in Bitcoin and digital assets into the fray. Quick word from uh Onramp. 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You can reach out to us at hellorampbitcoin.com or onrampbitcoin.com to sign up for on-ramp trade. takes about one to two minutes to get fully onboarded and start buying Bitcoin all the way to uh something that we also released last week which is self-service onboarding. So for any individuals that have been listening uh to these podcast and wanting to now feel the power under the hood of multi-institution custody. You can go to honorbitcoin.com sign up and then set up a standard or private account. We'd love to work with you if you have any questions. We have an updated FAQ page, but you can also just reach out to hello@honorantbitcoin.com or michael@hon honorbitcoin.com and we'll get you in touch with the right individual. Hope you enjoy the show and uh please if you don't forget to like and subscribe, it goes a long way in helping uh to get this content in front of more individuals. Talk to you later. Yeah, one one uh thing I've been thinking about curious to get your guys' thoughts is um you know as this sort of Bitcoin Treasury company trade continues to play out like one thing I've been thinking about is consolidation. So like if you know if Micro Strategy would ever buy up smaller Bitcoin Treasury strategies if you know they're trading at an MNAV of one or less. And then even more interestingly like if you think about five ten years from now and a Google or Apple or even a sovereign government wants to acquire a lot of Bitcoin the best way to do it might be to acquire a Bitcoin treasury company so that you're not you know just buying on market uh you know 50,000 to 100,000 Bitcoin if you can just buy um a corporate entity that holds Bitcoin. Um curious how you think that plays out in terms of just consolidation and then these vehicles being basically uh a quasi form of like OTC deal for someone to acquire a large amount of Bitcoin. I mean, the first part is it kind of goes into how I've thought about the early writer stuff is at a certain point a company that generates profits in Bitcoin doesn't sell for anything other than Bitcoin because why would you sell for dollars, you know, like if you're already making a Bitcoin, you're the Bitcoin printer. And um so you you're going to convert it either way. So I think that naturally applies on my first listen of like if you already hold 85 billion in BTC and you expect it to be whatever. So, what's the multiple you're going to sell it for? So, you're probably going to have to buy it for much more Yeah. than the Bitcoin, not less. Especially if you already have like accumulated that because you're probably going to do the the analysis of like, well, what it would cost me to go do that? It's not the spot price. It's whatever the, you know, reflexivity. Um, that's my thought on there. What what I what I think like on this whole Treasury thing, I think we're like at a race. It makes complete sense. Um, I've had a lot of time to think about like this the state of like inside money and outside money and there's a lot of black money that's like exited. There's it's not a uh it's not a shock. um without getting conspiratorial like in 1999 I think uh or 2000 there was like $2 trillion 2.3 trillion that was publicly missing and now I think there's like 20 trillion and we have you know wars and all this stuff and it's like money just goes it just goes and where it grows you know it's topic for an offline podcast but point being is um it makes complete sense that like if you could take delivery of this you can be self- sovereign you can figure out how to like leverage multi-institution you can do all these different things or you and corral the capital into the capital markets and consolidate it with one custodian. This was going to naturally proliferate and it was going to be encouraged because it just keeps everything nice and tidy. And so I think um it's going to be a race kind of a convergence of like if these can stay up long enough to accumulate more and more BTC and then what happens if people like something bad happens and they kind of delever because people wake up and then they realize it or if they can continue to accumulate more. it's going to be very interesting because we're only at 107,000 and it's already like we're seeing this concentration and it's going only going to increase. Um the optimistic view is that like everyone that gets some kind of exposure to this asset class, they naturally have to uh understand it because it's their money and that's what people have to do with their money is understand it. So, if somebody bought, you know, they're worth, let's just say 100K and they bought $1,000 of um, you know, MetaPlanet and then now it's 50,000 or 50% of their net worth. Well, that that wouldn't be it's illogical to be like they wouldn't understand why it went up, right? They go do some diligence like what what does Met Planet buy and then like what is this thing? And it's like, oh, I can I can own it. And then like you start to see counterparty risk and you see like different states and sovereigns fail and you see them get bombed. You see all these things and maybe it gets seized and you're like, oh, maybe I want the underlying. So that's like I think the positive case that people will wake up before there's too much but I do see like how there could be a vet horizon where there's like too much concentration and it I don't know if it's an existential problem but there is a very big problem there. Um and it and what's scary is that it's very easy for people to buy this in a brokerage because that's how they their mental models of the world is. Um so yeah like the concentration's real. Yeah, I think that um even if MNAV goes below one, I think many of these companies will be slow to be accepting that they're willing to sell at those prices because they're going to be like, "Okay, well, I acquired this much Bitcoin over the past 12 months, 24 months, whatever it may be, and I could do that again once uh MNAV eventually goes above one. We'll see if that ends up happening or not." Um but the other aspect of as well is um you know there is a new letter out about CTV and CS uh FS um potential soft fork that they're looking to implement in the next six months. uh we don't need to go deep into it now, but um you know that's going to be another factor that shareholders will need to consider when making investments into these companies because you know uh a lot of these Bitcoin treasury companies do already have a substantial amount of Bitcoin and um you know you're going to want to be aligned with whatever their view of their protocol is over the next near-term as well as long term and just like understand that you you know the ultimately the entities that are running the nodes will have the decision of which way they want the protocol to go in the long term um which is you know the the centralization risk here with you know 216 entities having about 30% of the supply yeah and I would I would uh posit that the vast majority of people investing in Bitcoin treasury companies have no idea how soft forks work yeah 100% they're going to want to it's like invest then uh investigate which is later on they're going to realize that oh hey these things are actually very important to the underlying protocol as well as you know even if you only want to stay in Micro Strategy forever um you know softworks and and any protocol changes will inevitably impact um your investment in the company as well. Yeah. No, that's a good point. What do you um do we want to transition to a few um of the public market stuff? I think it came out that uh onet Dan Tapiro's I think parent company or I think it's one T unless 10TZ it's 10T but I feel like uh it's SPACK 1 RT acquisition files for 100 $50 million IPO. Um I believe Pomp is running a $750 million spack. wasn't clear initially, but I guess now it's to buy Bitcoin if I'm if I'm correct. And then Bullish and Gemini both um I think confidentially are going to be filing for IPOs. Just curious your guys' take on any of that. Yeah, I mean it's the trend. You you you find a spa, you get a blank check company, you buy Bitcoin. That that is that is the trade right now. Um so expect to see more of this. Yeah. Uh definitely not seeing the end of it for right now. Um with Gemini, um there there's just so much demand for uh you know, actual operating companies as well. on. So, um I don't think any of their uh financials um are public or I haven't seen much floating around on that yet, but would be interesting to see if they're going to, you know, go the Coinbase strategy of owning a little bit of Bitcoin and uh just, you know, running their operating company or if they're going to um you know, just be looking to to play the Bitcoin treasury game on a larger scale. Um, but I think that more than that, um, you're just going to see a ton of M&A of, uh, you know, I mean, Privy I had never heard of prior to the Stripe acquisition. And I think that right now the market is about as frothy as it can be when it comes to acquiring other um, you know, crypto infrastructure providers. Oh, be careful there. It is definitely not as frothy as it could be. We are like I think maybe second inning of froth. Uh but I hear I I hear you. I think I think there's two positive really positive takes for Bitcoin in this one is um naturally when like companies IPO, you know, early um early founders or operators get liquidity and then they generally reinvest it into the market, whether it's venture or building businesses. And I think a lot of these companies, these people aren't dumb and they're going to get liquidity on their shares and they're going to be able that's going to be a natural demand for Bitcoin because they just had years to do the work. Um, but the other side of it is I think like we have to re anchor because there's a lot of noise out here and a lot of shiny objects that Bitcoin just is the best tool, right? Like it's the best tool from an interoperability perspective. It's the best tool from a censorship um perspective or not censorship resistant, best tool from finite scarcity. And so over time, if that's true, then the market naturally will adopt it and it'll infuse it in all its products and services. And so these individuals, some of them will come out really understanding that and they'll build some of these world-class businesses and they'll understand scale that historically have hasn't been there. So again, it's it's a huge opportunity. I think of when we see these things, there's like u this notion of cloning. You want to look at what works and then just like slightly iterate it to make it work on your your benefit and add additional features. And so yeah, this is another one I guess Justin Sun going public. This is like the perfect sign of um I don't even know it's not nepatism but whatever the political version of nepotism would be. Uh you know Justin Sun I think it came out that he wasn't going to get investigated. I think was the SEC or maybe it was the DOJ that got paused and now he's going public here. Um you know his shares will will probably command a pretty high multiple and some of those funds will go back into the administration. It's uh this is just how things have always worked and so you can kind of see this happen in real time because we're following this industry. Yeah. And Eric Trump expected to join the new leadership team of Tron Inc. Um if you had that on your bingo card for this cycle, congratulations. Can we find out in real time if if Sailor really is um joining Pakistan's board of adviserss? I will pull it up. Uh we can look in the comments. I think people were questioning this. So, just for those unaware, uh there was a headline this morning that Sailor was appointed the official Bitcoin adviser to the government of Pakistan. Um it sounds like representatives of the Crypto Council of Pakistan are denying the report. Um so, I'm going to go ahead and say this is probably not real, but uh wouldn't uh wouldn't wouldn't surprise me at this point. Yeah, no one seems to know. There was another uh interesting capital raise. Um I initially it caught my eye because we had launched around the same time and they just recently raised like about $30 million. It was a firm called Churn Key and the it's a with a Q. I don't fully understand their model but my base understanding is that they're infrastructure for um companies and wallets but they kind of obiscate uh private keys. So, they're able to just think of a lot of um I don't want to say sophisticated because it's probably it's not the best word, but they create uh other ways to let people manage like crypto assets and stable coins without having to write down C phrases and monic phrases. And one take would be that that's what's needed in market structure is like, you know, people don't want to know and write down these things. I don't know if I would go in that direction because I do think that there's something very valuable. I think it came out this past week. I don't know if it was the SEC that came uh publicly said, you know, private keys and and self- custody is a is a sovereign right of US citizens. And so, similar to gold and what makes the system work is you do need to the ability to solve custody and you do need the ability to always take delivery of your capital. So, I think obiscating that is is the wrong move. Um that's where I think like you know having been in the space for a while and building you know collaborative custo multi-institution I don't think it's fair for the end user just to like say don't worry about it because you actually had more complexity when you have to recover this stuff and there's a lot of lock in requirements. Um and so like that's one angle. I think the the other angle that we kind of take is well you kind of you just you you push it out to the edges to the financial institutions that have the regulatory bodies and the capabilities around institutional you know key generation ceremonies and then you don't trust a single one. Um, so it's going to be interesting to see how this plays out because the problem with like things like turnkey, we should I should look more into it. But the reality is most of the time any of these like sophistic quote unquote sophisticated things actually add more complexity and complexity is the enemy of um security. And so they probably work when you're trading around and whipping tens of thousands of dollars, but when you're thinking about hundreds of thousands or millions of dollars, um it's not something you want additional complexity in your kind of like custody format. Yeah. Is this the deal? I I've never heard of this company. Yeah, they spelled I'm pretty sure they spelled it wrong on this. Um I think it's T U R N Q E Y I think um maybe a slight pivot um towards some some macro data. Liam, you shared this one in the chat. um just unemployment rates uh I'll pull this up uh for recent graduates versus other groups thoughts on this. Yeah, this one was really interesting to me. So um this is uh for those listening recent college graduates aged 22 to 27, all college graduates, young workers aged 22 to 27, and all workers. So recent college graduates age 22 to 27 has historically been below all workers. They just are more demanded for um work just because of you know their credentials and you know what they what they've done in the past. Um while young workers aged 22 to 27 have just been slightly less demanded you know without a a college degree. What we've seen recently is that um now young workers age or recent college graduates between 22 and 27 have actually ticked up above the line of all workers which is you know u meaning that there's less demand for recent college graduates than there has been historically and I think that's kind of uh a factor of two things one is um you know it can be some macro data in there of just like companies being slower to hire But I think it's also just um you know happened around 2022 which was you know the invention of chat GPT and uh when all these AI tools started to get u more efficient and so a lot of these companies are very slow to lay off um existing workers but they will replace jobs u before they actually have to hire them just because they're better and more efficient tools and anything that goes from you know uh making a law firm more efficient by being able to use these in order to, you know, draft memos, um, you know, create and and read, um, very dense documents faster to everything else that's, uh, required within the workflow of pretty much any company. I think that this is something we've talked about for a very long time of just like the structures of organizations compressing over time. you need many fewer workers in order to um you know make very uh successful and and cash flowing in uh companies that can be incredibly valuable over time. as well as just um the the structure of companies is going to flow from um you know not not having quite as many just workers um all across the organization where they they can actually go out and uh be more of a freelancer and and use these different tools in order to um just create successful businesses themselves or or on a very small scale. Um so this is something that's really interesting to watch um and we'll continue to keep an eye on it. I wonder, this is going to sound crazy, but I wonder uh you know, we've talked about it a few times, how there's all these different convergences of AI and Bitcoin, and I wonder if this is like uh the closest analogy I was thinking of when you were talking is like uh in prison cigarettes. And the reason why I say is like you go to prison, right? I've never been, but you like you see in the movies where u that like you know all sorts of commodities start to proliferate and like cigarettes are the thing like that's the store value because of um you know the coincidence of wants and then multiple people want it and they don't even have to smoke but you like trade and you you have it and I wonder if this world of deflation and naturally like people being laid off or seeing the writing on the wall like think if you're a middle management or um at a consulting firm and you you have some foresight and you know you only have two years to be commanding this 150 to 200,000 and you save like 250k if you're naturally looking at this you know unit the cigarette that's appreciating it starts to become understood it's like this is how I offset the deflationary forces that are coming for me because maybe that person doesn't make X they may have to start doing consulting across different you know they become effectively like a mercenary and they're just hired across different things and maybe they make half of that but they sweep it into BTC and So they're basically making their purchasing power the same. Like there's something there that I think um similarly with businesses, right? Because if a business raised $100 million and this, you know, the AI trends only accelerating, you realize that your cost of um you know, your instance or whatever you're selling to the market is going to naturally compress because of, you know, all these tools. You start to park more of those dollars in your treasury to offset that. That feels like another really big tailwind. a little early, but it it's something like that. It kind of like flips on a switch once it becomes understood. Um because you're just like, why am I holding these other things? It's just basically like a people using AI. It's like, well, if you don't use AI, you kind of already know you're you're done. Uh or you don't use the internet. It's going to be similarly with Bitcoin and personal finance all the way to like corporate and business strategy. Yeah. Yeah, that's a great point. And I think that another aspect of this as well is just like prior to even um yeah, like if you're if you see the writing on the wall that you know your position may not be needed within two years or so and you continually sweep all of your own personal cash flow into Bitcoin, um you're going to be able to spot spot the gaps in the market and have both one a higher value of the asset to in order to start the business as well as you know be able to go out and provide a more efficient service uh for yourself. And so I think uh Bitcoin is you know giving the tools to those who um who who really need them during this kind of changing world. Yeah. Unfortunately for these recent college grads, they may they might not have as much optionality to uh implement that strategy if they are not yet earning any uh income and they're searching for a job and and instead people are just using AI tools instead of hiring entry-level um positions. So uh but agree that that's you know for the more uh established business professional or middle management type person like that is a completely rational strategy that you know I I would be optimistic as well that that people start to wake up to that reality. Um maybe go ahead. I was going to say before we wrap we should just highlight u the tether stake in elemental um the gold refinery because I think this is a trend we've been talking about and watching closely um gold and bitcoins interplay. There's a few angles to it. It just came out like I don't know a few minutes ago that um Trump social or truth social is going to launch like a Bitcoin Ethereum ETF. Mhm. Um, and I think this is somewhat like adjacently related to it in the sense that, you know, gold and Bitcoin, they're naturally scarce assets, similar underpinning thesis, but also most people don't come to Bitcoin as the best form of money and that's the only thing they should hold. And so I think there's a natural version of gold and Bitcoin products coming to market and what does that look like in those rails. Um, and it's not, you know, if you want to be positively skewed, it's not Ethereum and Bitcoin. uh is probably more of gold in Bitcoin. And so I there Tether, you know, holding I think 50 uh ton 50 tons of gold. Such an insane number. Um I think it's 50 tons uh that they're they're making this bet. And so it's interesting to see kind of like the different bets and the scarce assets Tether's making across gold, Bitcoin, um and then land as well. Yeah. And uh one other thing that they've done as well is go into um private investments as well. And so this is something that Darius Dale has kind of pointed out and he's done a good job of this of just uh removing the 6040 from your portfolio and and replacing it with 60 3010 of uh 60% equities, 30% gold, 10% Bitcoin of just uh if if you want to see, you know, more of a an uncorrelated portfolio, which many people do just because they're risk averse um and you know, want to be downside protected, it makes more sense to have, you know, a political assets that are relatively scarce like gold and bitcoin. And so, um, yeah, this is just something that I think we're going to see more of as bonds continue to underperform in the traditional portfolio. Yeah, along along those lines, this was a chart, uh, that I found that sort of speaks to that that transition beginning to occur. Um, just in that the sort of traditional pension fund allocation, equities relative to bonds are at all-time highs. Um, so I think people are waking up to negative real returns of their bond portfolios and realizing that you know I guess the first order is just increase your equity allocation. Uh, but then the next step beyond that is is adding some scarce assets whether it's gold, bitcoin or a combination of the two. Um, and similar to that that tether deal, you know, Caner had an announcement a few weeks ago around a gold bitcoin product. So, I think we're just scratching the surface of of what that interplay and various financial products built around those two assets in particular uh will look like in the coming years. Um, one other thing I just wanted to share and then we can wrap unless you guys have anything else was uh while we're just looking at government data. Um, this was an interesting chart around CPI methodology. Um as we know uh CPI methodology uh sort of consistently changes over time in terms of the the inputs the basket of goods that's being measured. Um and this uh chart is showing use of alternative estimation methodology and CPI has spiked pretty materially uh in the past uh few quarters or months. Um and so this is just a reminder to uh always look at CPI data and other government um issued data with a massive grain of salt. Um and understand that inflation is is you know in in reality far worse than whatever CPI has reported as um and probably likely to accelerate going forward. Uh we saw oil begin to spike last week as um sort of tur turmoil in the Middle East um reescalated. Um, so just something to keep keep an eye on as well. Yeah, we we have to jump to go to a call, but uh the we don't have to pull it up, but this reminds me of Parker's tweet from last week for I think four or five years. He's been um just doing a you know going into Whole Foods and looking what a dry age ribeye uh cost. And it's pretty crazy when you go back because it's like similar to when you go look at a receipt from I think one came out like 30 years ago that was showing like you know what like hot dog buns cost. It's like 17 cents, something crazy. It's just bread, right? Plastic bag. But point being is um the gaslighting around inflation is real. And the the my favorite part of that burger tweet is there's the natural like Trafi people that come in and it's like oh what like you know horrible thing to call out. It's like a dry age from Whole Foods ribeye. But it's like it's not the point of like what the good is. It's the point of like these are market forces because Whole Foods charges too much to go out of business. like this is just economic coordination uh you know and the price reflecting that and so if they can't this is what they have to charge. Um and you could pick any basket or any like unit and you would see a very similar you might even see it worse. So anyway it's just the the indoctrination around this stuff is really interesting where people see it in front of them and they can't actually admit that inflation is completely out of control and you're losing purchasing power every year if you're not holding a harder form of money. Yep. Well said. Yeah. Buco go capital those. Yeah. And uh you know eat uh eating less quality meat is or or just less quality food in general. You know, don't just don't just eat processed foods instead. Uh just because the price of your meat is going up. Basket is always changing. Uh all right, boys. Yeah. Good rep. Thanks for joining us everyone. Uh see you next week. Later. Later, guys. Hey everyone, hope you're enjoying the show. It was a great discussion touching on all things that happened over the weekend and coming up this week in the Bitcoin digital asset space. Just wanted to quickly remind everyone that on-ramp while we have multi-institution custody which brings peace of mind to Bitcoin holders uh from you know early adopters that have built a material stack and are looking for peace of mind for their existing solution. How do they plan for inheritance and all things related to financial services all the way to net new entrance that are looking to build a material position but don't want to deal with cryptographic material plastic devices how do they secure it on a third party exchange we support them in different formats whether it's on ramp standard where they can onboard as low as $150 a month to our private u product offering that comes with a whole slew of benefits and one of them is the guild and our private investment network. We've seen a lot of demand for that recently. We talk with individuals across the world frankly and there's a common theme uh coming across that there's business professionals that have either built a position or starting to a material one and they ultimately want to get access to private equity in the space. They want access to the best minds in the space and they're they're trying to figure out what's their next move whether co-founding, operating a business or just getting a seat at the table from an advisory perspective. If you're interested in any of those things, I would encourage you to reach out. Michael honoritbitcoin.com. And again, if you may not necessarily want to talk to anybody, but you feel comfortable with our solution, you're ready to go. You can go to honorbitcoin.com and go through our self-service process. I hope you enjoy the rest of the show. Thanks for listening to this week's episode of the show. 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