Speaker 1: What are the big problems that they're facing when it
Speaker 1: comes to building wealth.
Speaker 2: A lot of people think that guiding wealth is you know,
Speaker 2: the hot pot and kp Itzazy. Personally, from my experience,
Speaker 2: it's the complaint.
Speaker 1: Opposite when it comes to building wealth. I like to
Speaker 1: call it the game of money, and you might imagine
Speaker 1: that people that have been playing a game a lot
Speaker 1: longer than you probably have some tips and tricks and
Speaker 1: strategies that they could use to probably beat you pretty quickly.
Speaker 1: So in the game of building wealth, you might imagine
Speaker 1: that the wealthy, the billionaires have access to tips and
Speaker 1: tools and strategies that you don't know about. But there's
Speaker 1: ways we can change that. So today I'm going to
Speaker 1: sit down with Peter Dunworth. He's the founder of the
Speaker 1: Bitcoin Advisor, So he works with high net worth individuals
Speaker 1: family offices to help them build generational wealth and incorporate
Speaker 1: bitcoin into that strategy. So, if you want to know
Speaker 1: the tips, tricks and strategies the high net worth individuals
Speaker 1: are using so you can win the game of money
Speaker 1: as well, pay attention in regards to preserving that wealth
Speaker 1: and then thinking about that wealth generationally. Who outright think
Speaker 1: it's bad to leave wealth for your kids.
Speaker 2: Now I completely disagree with Okay, you know, I look
Speaker 2: at my responsibility to my family, to my legacy. Sadly,
Speaker 2: there's no real out of the benchmarking society that we
Speaker 2: have that's universally accepted other than how wealth are you out?
Speaker 2: It's a school board that everyone understands what the school
Speaker 2: board is. There's no intangible around it. It's a number
Speaker 2: that you can look at. It's the only objective measure
Speaker 2: we have of success.
Speaker 3: Peter, thanks for joining me today.
Speaker 2: Pleasure to be here with you. Matt, thanks for having me.
Speaker 3: Yeah, what a great opportunity.
Speaker 1: Just happened to be in my neighborhood and so swinging
Speaker 1: by for an interview. So I'm excited about that. You know,
Speaker 1: there's a lot of overlap on what we do talking
Speaker 1: about wealth just overall, which is a pretty big topic.
Speaker 1: So I want to dig into problems that high net
Speaker 1: worth families individuals have, specifically around keeping wealth.
Speaker 3: There's a lot of attacks on keeping wealth.
Speaker 1: It's very hard to keep it. It drains away from us.
Speaker 1: Governments are trying to take it from us. So how
Speaker 1: do we keep it? We talked briefly about some potential taxes.
Speaker 1: I want to get into that how bigcoin can help
Speaker 1: fix all of this, keep build wealth, keep from losing wealth,
Speaker 1: build into the future. I want to think, since you're
Speaker 1: international from Australia, sort of what Trump's announcement means to
Speaker 1: the rest of the world. And then I want to
Speaker 1: go through some different strategies that high net worth individuals have.
Speaker 1: So hopefully we have time for all that. So let's
Speaker 1: just frame it up here really quickly. So you work
Speaker 1: with high net worth individuals family offices. Family offices offices
Speaker 1: typically would be you can define it for me, but
Speaker 1: define what family offices are and define with me for us,
Speaker 1: what are the big problems that they're facing when it
Speaker 1: comes to building wealth.
Speaker 2: Great question. Family offices in my definition of families who
Speaker 2: have generated substantial little significant amounts of wealth that want
Speaker 2: to be managing those assets themselves.
Speaker 1: So what would that number be, Like, what's that threshold?
Speaker 2: It can start at twenty five I would have thought,
Speaker 2: and twenty five millions to billions of dollars twenty five
Speaker 2: million or more. I think that's a starting point that
Speaker 2: you know, you can start looking at that. Under that
Speaker 2: you're probably working with a multi family office where you're
Speaker 2: leveraging off a number of other families to generate investment
Speaker 2: ideas and returns and then leverage that in two further ideas.
Speaker 2: And from my experience, a lot of the families that
Speaker 2: we work with, the number one issue that they've got
Speaker 2: is keeping their wealth. The families that we work with
Speaker 2: are not interested on a return on capital. They're interested
Speaker 2: in a return of capital, meaning they're not focused on
Speaker 2: the percentage gains that they're making. They've made the pile,
Speaker 2: they've made their wealth. They want to make sure that
Speaker 2: it's secure. So the first thing they look at when
Speaker 2: it comes to any investment, whether it's real estate, whether
Speaker 2: it's stocks, properties, bonds, or even bitcoin, is they want
Speaker 2: to make sure that the ownership the custody is locked
Speaker 2: down and they can't be subject to a number of
Speaker 2: different attacks on that absolute base layer. So ensuring that
Speaker 2: you own what you think you own is probably the
Speaker 2: first port of call that you need to look at,
Speaker 2: and probably so something preliminary to that is what are
Speaker 2: the structures from a legal perspective that you have access
Speaker 2: to to maximize the outcomes that you want to get
Speaker 2: from the investments that you're putting that money into So
Speaker 2: I think it starts with the structures.
Speaker 3: Then got it.
Speaker 1: So that's an interesting way to think about it. And
Speaker 1: you know, I've often said, and this is unfortunately from
Speaker 1: a personal experience, that keeping money is a lot harder
Speaker 1: than making it, which sounds crazy for most people who
Speaker 1: haven't made money. But once you've made it, as I
Speaker 1: found out the hard way of losing it all, keeping
Speaker 1: it is much harder. So and then the more you
Speaker 1: have of it probably the bigger problem or challenge that
Speaker 1: becomes agreed.
Speaker 2: And this is where a lot of people think, oh,
Speaker 2: it's so easy being wealthy, and to a certain extent,
Speaker 2: there are a lot of problems that go away when
Speaker 2: you're wealthy. But with great wealth comes great responsibility, and
Speaker 2: there's a responsibility that's put on you to not only
Speaker 2: maintain it, but to preserve it. And then the questions
Speaker 2: around legacy start entering your mind, around how do I
Speaker 2: preserve this for the people I love into the future.
Speaker 2: So a lot of people think that gaining wealth is,
Speaker 2: you know, the hard part, and keeping it's easy. Personally,
Speaker 2: from my experience, it's the complete opposite. It's it's the
Speaker 2: keeping it that's the tough part.
Speaker 1: I want to get into the generational wealth. That's something
Speaker 1: I think about a lot. That's kind of the stage
Speaker 1: that I'm in right now, so I want to come
Speaker 1: to that.
Speaker 3: But before we get.
Speaker 1: Into that, let's just talk through some of the major
Speaker 1: asset classes that people can invest into. You mentioned real estate, bonds, bitcoin,
Speaker 1: things like that, and Michael Saylor sort of laid out
Speaker 1: sort of some of the flaws in each one and
Speaker 1: how they cost you money. But one of the biggest
Speaker 1: problems is also taxes. So you were mentioning before we
Speaker 1: started recording that in Australia they wanted to launch I
Speaker 1: believe a tax on unrealized wealth at three percent I'm sorry,
Speaker 1: at three million correct.
Speaker 2: In our pension system. There's legislation going through on the
Speaker 2: first of July that if nothing changes then that legislation
Speaker 2: will go through first of July and they go into
Speaker 2: tax at a right of thirty percent unrealized capital guiins
Speaker 2: tax on pension balance over three million dollars. So if
Speaker 2: you have a ten x return in bitcoin and you're
Speaker 2: all in bitcoin with a three million dollar fund, you're
Speaker 2: going to make twenty seven million dollars in a year.
Speaker 2: They're going to send you a bill for eight point
Speaker 2: one million dollars of unrealized tax gains. And now in
Speaker 2: order to pay that bill, you're going to have to
Speaker 2: sell down some bitcoin, and you're going to incur a
Speaker 2: further eight hundred thousand realized capital gains tax to pay
Speaker 2: the bill. You pay nine million dollars on that gain,
Speaker 2: even though and it's an oxymoron to say an unrealized
Speaker 2: capital gain, because the very definition of capital gains means
Speaker 2: that you've disposed of an asset. So they've just redefined
Speaker 2: the English language to suit an agenda that they want
Speaker 2: to take your assets before you've you've gone full circle
Speaker 2: on the investment.
Speaker 3: Now.
Speaker 1: The reason why I want to dig into this and
Speaker 1: talk about it a little bit is because I think
Speaker 1: both of you and I probably agree that whatever is
Speaker 1: probably happening in the G seven, if you want to
Speaker 1: call it the West Canada, Australia is probably a test
Speaker 1: bed for what may be coming for the rest of
Speaker 1: the world. So if it's happening in Australia, it's probably
Speaker 1: coming into Canada, it's probably come into Europe, and it's
Speaker 1: probably going to be come into the.
Speaker 3: U at some level. So if we talk about this.
Speaker 1: Now, you said it's in people's pension accounts, correct, So
Speaker 1: if I hold it in a personal account, if I
Speaker 1: own the stocks or whatever assets personally, that's not subject
Speaker 1: to that.
Speaker 2: Correct. So you can hold it in trust, company or
Speaker 2: personal and it won't be subject to an unrealized capital
Speaker 2: gains tax. I think for the moment, the way it
Speaker 2: was proposed, it was ill thought out legislation that was proposed.
Speaker 2: No one really picked it up, no one really cared
Speaker 2: about it. The feedback I've had from the industry is
Speaker 2: that no one really cares about rich people getting tax more.
Speaker 2: But what they don't understand is the downstream consequences of that.
Speaker 2: And anyone who's holding bitcoin in that pension system will
Speaker 2: very quickly reach that three million dollar threshold and then
Speaker 2: we'll all be subject to the tag. So it's a
Speaker 2: slow creep that has no indexation as well. So you're
Speaker 2: going to be suffering that regardless. And if we think
Speaker 2: probably long lines similarly, from a hyperinflationary type event, or
Speaker 2: at least an inflationary event, three million is not a
Speaker 2: lot of money. Yeah, we're going to be there in
Speaker 2: the next dickide.
Speaker 3: Yeah.
Speaker 1: I mean the crazy thing with that to your point,
Speaker 1: it's not a lot of money, and because of the
Speaker 1: inflation when you think about I mean, here we are
Speaker 1: in this beach town in southern California, and I know
Speaker 1: my neighbor across the street from me house is probably
Speaker 1: worth I'm guessing four million, four and a half million dollars,
Speaker 1: and he bought the house for three hundred and thirty
Speaker 1: thousand dollars I believe in like around the early nineties,
Speaker 1: so that's twenty five years ago. So they bought the
Speaker 1: house for four hundred grand twenty years ago, and now
Speaker 1: it's worth four and a half million. So basically, through
Speaker 1: the money printing, through the inflation, they've artificially pushed the
Speaker 1: asset price up and then they do want to take money,
Speaker 1: so you're actually worse off.
Speaker 2: Right, This is the problem that that creditory event, which
Speaker 2: is sort of pushes inflation, makes everyone feel like they're
Speaker 2: wealthy and they're richer than they are. But the problem
Speaker 2: is Yo Naiba, if he wants to monitize that in
Speaker 2: any white hypo form other than debt, needs to sell
Speaker 2: that asset. Pibwaeva taxes are revivable on it. Whatever's left,
Speaker 2: he still has to find a home yeah, and guess what,
Speaker 2: everything else has gone up around him, so he'll probably
Speaker 2: be buying an inferior asset. And this is where to me,
Speaker 2: bitcoin plays a huge part, particularly for those real estate investors,
Speaker 2: of diversifying a portfolio and adding in an asset that
Speaker 2: they can understand or easily understand that is very similar
Speaker 2: and acts very similarly to real estate. But to me,
Speaker 2: it has a significant upside over and above what real
Speaker 2: estate does, even with the leverage that you can get there.
Speaker 1: Yeah, before we get into that though, we're just kind
Speaker 1: of sticking on this for a minute. I mean, why
Speaker 1: would anybody keep money in a pension account. If that's
Speaker 1: the case, would everybody just close their pension accounts out
Speaker 1: and move them into other assets.
Speaker 2: Well, the problem is this is captive for anyone under
Speaker 2: sixty two or sixty.
Speaker 3: Five years of age.
Speaker 2: They're allowed to sell, they're not allowed to sell, well,
Speaker 2: they're allowed to sell their assets, but they're not allowed
Speaker 2: to take the assets out of the pension system until
Speaker 2: they reach what's called preservation age, which is around between
Speaker 2: sixty and sixty five. Time we get there, they'll push
Speaker 2: that to sixty five to seventy and it's kind of
Speaker 2: a hotel California for capital that can go in, but
Speaker 2: unless you're retired, you can't take that money out.
Speaker 1: Now, is this only for government workers the captured pension
Speaker 1: system or is it like private businesses?
Speaker 2: Also peed into that this is for everyone in Australia.
Speaker 2: But just the absolute duplicitous event that happens on this
Speaker 2: is that most government pensions are not subject to this
Speaker 2: tax because they have something different different called a defined
Speaker 2: benefits scheme. So fortunately for the politicians who are making
Speaker 2: decisions for the rest of us, their superannuation scheme or
Speaker 2: pension scheme is not affected, so they will not suffer
Speaker 2: the tax consequences that everyone else will.
Speaker 3: Sure, it's what it always is.
Speaker 1: Recently, I saw Larry Fink from Blackrock was over I
Speaker 1: believe in India, and he was talking about how Blackrock
Speaker 1: wants to help these other countries build up capital markets.
Speaker 1: So the US sort of has it unfair advantage because
Speaker 1: we have these capital markets that attracts all his capital.
Speaker 1: But he wants these other countries like India that are
Speaker 1: rapidly growing to us of capital markets and maybe try
Speaker 1: to kind of bring them up. And he talked about
Speaker 1: the problem that India has because most people down their
Speaker 1: own gold, so they keep it as jewelry and they
Speaker 1: keep their wealth in that gold. And he talked about
Speaker 1: in a roundabout way where basically India should sort of
Speaker 1: make that illegal because they need all that wealth in
Speaker 1: the system, right, So that's kind of the point that
Speaker 1: you're making. They want that money in the pension and
Speaker 1: then they want to probably continue to raise that pension
Speaker 1: age because they need that money to stay in there.
Speaker 1: And that's exactly what Fink was saying. He's like, no, no,
Speaker 1: we need all that gold to go into the system
Speaker 1: so we can have it. And he even did talk
Speaker 1: about the age at which you could withdraw it, but
Speaker 1: even more specifically what he talked about was the way,
Speaker 1: meaning the schedule, the time, how much you could withdraw
Speaker 1: at a certain time, because again, they want the money,
Speaker 1: and you know, with governments going broke, I mean, they're
Speaker 1: just going to be coming for everything.
Speaker 3: We just have to sort of expect that.
Speaker 2: And sadly, this is why I bring it up, and
Speaker 2: it's a cautionary tale because Australia is a test net
Speaker 2: for the rest of the world when it comes to this.
Speaker 2: If there's very little pushback in Australia, then other governments
Speaker 2: will look at that and think, well, the Australians did
Speaker 2: knock up about it, why don't we test it, And
Speaker 2: so it will just proliferate amongst those G seven countries
Speaker 2: that you talk of.
Speaker 1: You know, I just went to Australia for the first time.
Speaker 1: I was down there just a couple months ago, and
Speaker 1: I grew up, you know whatever, watching Crocodile than the
Speaker 1: and you know Stever, when I just had this vision
Speaker 1: of these these Australians being these rugged and burly kind
Speaker 1: of kind of people, like that's not a knife, this
Speaker 1: is a knife, right, or the Foster's like this is
Speaker 1: a beer or whatever it.
Speaker 3: Is, right.
Speaker 1: But yeah, sure seems like the Australians are pushovers these days.
Speaker 2: Sadly, I hate to say that, right.
Speaker 3: It all started when he gave up your guns.
Speaker 2: Yep, and I think there was it was an opportunity
Speaker 2: time for the government to have that gun buy back
Speaker 2: and seizure of the guns, and Australia hasn't really pushed
Speaker 2: back on that whatsoever. Gun liscense is very different to
Speaker 2: what it is in the US. The US it is
Speaker 2: a right. In Australia it's a privilege that the government
Speaker 2: bestows on you if you meet the certain hurdles. You
Speaker 2: need to go through all sorts of licensing and training
Speaker 2: in order to get that. There are some exemptions for
Speaker 2: farmers and the like who need that for maintenance of property.
Speaker 2: But it's been a it's a very different culture in
Speaker 2: Australia to America, and I think there has been a
Speaker 2: whittling away of that oka Australian who pushes back on
Speaker 2: authority to say, hey, we don't want to deal with that,
Speaker 2: leave us alone, and probably highlighted by the reaction the
Speaker 2: behavior around the vaccine mandates and lockdowns that we went through,
Speaker 2: which I think we're probably globally the most raconian out
Speaker 2: of anywhere. And I live in New South Wales or Sydney,
Speaker 2: south of US as Victoria which had arguably the world's
Speaker 2: long well it did have the world's longest lockdown, and
Speaker 2: so I had a lot of friends down there who know,
Speaker 2: just walking in the street, they were stopped the police
Speaker 2: decide what are you doing? Where are you going? You're
Speaker 2: not allowed to be out and you've got to go home.
Speaker 2: It's like I'm walking the adult like. There was some
Speaker 2: I think some serious concerns rised, and I think we're
Speaker 2: very quick to memory haul that and not not for
Speaker 2: attention to it, Forget it never happened, and move on
Speaker 2: until the next one.
Speaker 1: Run sidetracked into this little conversation. But just for a minute,
Speaker 1: we'll get back to the generational wealth question I want
Speaker 1: to get to. But what's going on in Venezuela right now?
Speaker 1: I mean, is a perfect example of where things eventually
Speaker 1: devolve too, right, and so in Venezuela, Now, did Maduro
Speaker 1: win the election? Is was there some sort of a
Speaker 1: coup that's going on? Like what's going on down there?
Speaker 1: But more importantly, without getting into the facts, because we
Speaker 1: don't know the facts, but we do know that's facts.
Speaker 3: Is like you have the.
Speaker 1: Military opening fire on innocent civilians. We do know that
Speaker 1: that's a fact. Now we don't know the circumstances behind that.
Speaker 1: And I saw I think I retweeted. I think it
Speaker 1: was Spike Cohen said that socialism is one of the
Speaker 1: things that you can vote your way into, but you
Speaker 1: got to shoot your way out.
Speaker 2: Of strying's done. How many guns left? That's a problem
Speaker 2: for ye try Yeah, in America, not so much.
Speaker 1: Yeah, although Kamala Harris is already talking about trying to
Speaker 1: change that as soon as you can, so we'll see.
Speaker 3: How that goes.
Speaker 1: Anyway, let's get back to the top of a hand here.
Speaker 1: So high net worth individuals they think more about preserving
Speaker 1: wealth than acquiring because they've already made it, so how
Speaker 1: do we keep it? They think about what types of
Speaker 1: assets they could buy that they could keep that, taxes
Speaker 1: being one thing that they have to navigate, but in
Speaker 1: regards to preserving that wealth, and then thinking about that
Speaker 1: wealth generationally. And as I said, this is something I've
Speaker 1: been thinking a lot about because at the stage I'm
Speaker 1: at with my kids, I just went through setting up
Speaker 1: trust structures. We went new trust structures and building like
Speaker 1: family constitutions so that there's like a set of rules
Speaker 1: like a US Constitution around that wealth as it goes
Speaker 1: down generationally. So that's sort of where my head's been.
Speaker 1: And I've been sort of battling some people on Twitter
Speaker 1: because there's this whole seemingly movement or maybe it's just
Speaker 1: caught my attention of people. A lot of prominent bitcoinners,
Speaker 1: even who outright think it's bad to leave wealth for
Speaker 1: your kids.
Speaker 2: They're entitled to their own opinions.
Speaker 3: What do you think about it?
Speaker 2: I have, and I completely disagree with it. You know,
Speaker 2: I look at my responsibility to my family, to my legacy,
Speaker 2: not only to my children, but to know my lineage.
Speaker 2: I need to honor their lineage and the sacrifices that
Speaker 2: they've made to be as successful as I can be,
Speaker 2: and then to ensure that not only AREM a success,
Speaker 2: but my children are success. And sadly, there's no real
Speaker 2: other benchmark in society that we have that's universally accepted
Speaker 2: other than how wealthy you are. It's a school board
Speaker 2: that everyone understands what the school board is. There's no
Speaker 2: intangible around it. It's a number that you can look at.
Speaker 2: It's the only objective measure we have of success.
Speaker 1: Now.
Speaker 2: It's not the only way to define success, but it's
Speaker 2: the universally accepted way of that.
Speaker 3: Now.
Speaker 2: I look at that and think, why would you want
Speaker 2: to rob your children of the ability to leverage that
Speaker 2: and further the legacy of everyone who's come before you,
Speaker 2: And you think about all of the sacrifices that you
Speaker 2: make as a bitcoiner. I personally look at my children,
Speaker 2: I think I want them to go on and be
Speaker 2: productive parts of society. And I think if they've got capital,
Speaker 2: and I think it will be an indictment on myself
Speaker 2: and my skills as a parent if they don't make
Speaker 2: a contribution to society. I want them to go on
Speaker 2: and do great things. And having access and access to
Speaker 2: resources enables them to further the family legacy into the
Speaker 2: future and become meaningful contributors to society.
Speaker 3: I think of it.
Speaker 1: I think there's two different ways. I think, you know,
Speaker 1: because we went into you know, from an equity based
Speaker 1: system to a debt based monetary system sort of officially
Speaker 1: in nineteen seventy one, severing the tays to God. In
Speaker 1: a debt based minetary system, we're basically stealing value from
Speaker 1: the future, yes, And so we're literally stealing value from
Speaker 1: our you know, for our kids and grandkids, et cetera.
Speaker 1: I just think that's like the direction of the world.
Speaker 1: But as a bitcoiner, I think about flipping that and like,
Speaker 1: our money should buy us more goods and services in
Speaker 1: the future, and we should be building value into the future,
Speaker 1: not stealing from it. And I've been sort of using
Speaker 1: this analogy and this way to look at it as
Speaker 1: like a blockchain where it's like, my life is proof
Speaker 1: of work, and I'm building a block and I want
Speaker 1: my kids to be able to attach their block onto
Speaker 1: my block, and my grandkids to attach the block onto
Speaker 1: a block, and to continue to build this like blockchain
Speaker 1: of life, and like why wouldn't we push value into
Speaker 1: the future as opposed to stealing it from the future.
Speaker 1: Now I could see how people would say it's bad
Speaker 1: for kids. I suppose if you raise bad kids. But
Speaker 1: that's more of you, not a symptom of the money, right, I.
Speaker 2: Agree, And this is where money. You know, people say
Speaker 2: money changes you. I don't think it does.
Speaker 3: It just.
Speaker 2: Exemplifies and expands on what your true nature is. If
Speaker 2: you're a bad person, if you've got resources, you're going
Speaker 2: to do really bad things. If you're a good person
Speaker 2: and want to make contributions and build out and help society,
Speaker 2: having more resources allows you to do that. I think
Speaker 2: it's an internal struggle that's projected on to other people.
Speaker 2: It's always an internal struggle. And this is where for me,
Speaker 2: you want to provide optionality, whether it's to your children,
Speaker 2: to your clients, to anyone around you. Providing options and
Speaker 2: then giving others the choice to make I want to
Speaker 2: be in a position that they've got all the resources
Speaker 2: that they could ever possibly want, and then if they
Speaker 2: decide that they want to make a contribution, their best
Speaker 2: way to contribute to societies to make donations and give
Speaker 2: the money away, then so be it. And to me,
Speaker 2: and I was just talking about this with a group
Speaker 2: of tax attorneys across the country yesterday, that to me,
Speaker 2: bitcoin represents the best generational asset to pass on because
Speaker 2: not only is it going to be the lastest longing, sorry,
Speaker 2: the longest lasting, it's going to be the best performing.
Speaker 2: But there's a very curious thing that you can do
Speaker 2: with bitcoin that you can do with no other asset,
Speaker 2: and that is to your point about being able to
Speaker 2: put assets into the future. You can timelock assets for
Speaker 2: different generations, and so you can timelock bitcoin for different generations.
Speaker 2: And that's something I spend a lot of time thinking about.
Speaker 3: That. You might not.
Speaker 2: Want your children to benefit from your bitcoin or all
Speaker 2: of your bitcoin, and you want to leave bitcoin in
Speaker 2: for further generations, out for your grandchildren or great grandchildren,
Speaker 2: great great great great grandchildren. All of a sudden, you
Speaker 2: can timelock a portion of this asset today that's going
Speaker 2: to continually grow into the future. That can only be
Speaker 2: accessed to a future point in time, which is to
Speaker 2: your point about the debt robbing from the future to
Speaker 2: take now, that is the complete inverse to that. And
Speaker 2: this is where I think Dave Bailey came up with
Speaker 2: an innovative solution to pay off the US national debt
Speaker 2: by buying a trillion dollars worth of bitcoin, timelocking it
Speaker 2: for thirty or fifty years, and then have that as
Speaker 2: a way to pay off what's currently currently here.
Speaker 1: Now, imagine the dump on the market in twenty or
Speaker 1: fifty years what that would look like though, So you
Speaker 1: just made a couple of big claims. So you said
Speaker 1: that big onin is the longest lasting, it's the best performing,
Speaker 1: and then the ability to time lock it.
Speaker 3: Let's just go through that.
Speaker 1: So you said it's the longest lasting. So you talk
Speaker 1: about high neworth individuals thinking about saving their money in
Speaker 1: bonds or real estate or businesses or whatever. You said,
Speaker 1: bitcoin is the longest lasting. Break that down for us.
Speaker 2: It's ironic given it's only fifteen years old, right, and
Speaker 2: that comes from years of studying this and you're probably
Speaker 2: of the same mind that you know, the more time
Speaker 2: you spend looking at an asset or an investment, the
Speaker 2: worse it gets. You find holes in it. Oh, this
Speaker 2: could go wrong, that could go wrong. What have you.
Speaker 2: I've spent close to twenty thousand hours now staring at
Speaker 2: bitcoin trying to poke holes in it, understand what I
Speaker 2: don't understand, and I'm still an amateur even after that time.
Speaker 2: But from what I can see, I can't find any
Speaker 2: holes with it. It gets better every time I look
Speaker 2: at it. And this is where it's going to be
Speaker 2: the longest lasting asset that we've got on many different layers. Firstly,
Speaker 2: I think it'll outlast just about everything else in the world,
Speaker 2: whether it's stocks, bonds, properties, governments, society as a whole.
Speaker 2: That is the substrate of our structure moving forward. It's
Speaker 2: just that that information isn't evenly distributed, so not too
Speaker 2: many people understand that. If they did, we'd have bitcoin
Speaker 2: in the millions or billions of dollars per value. When
Speaker 2: I talk about bitcoin being the longest lasting, all you
Speaker 2: have to do is buy it and hold it, and
Speaker 2: if you self custody it, that can last essentially for
Speaker 2: ten hundred thousand years into the future, however long society
Speaker 2: is going to last. However, I'm very doubtful that you
Speaker 2: can achieve that same outcome with property or bonds or shares.
Speaker 2: You look at the average length of a company across
Speaker 2: our countries, and if you include startups, the average length
Speaker 2: of the company would be about five years. No, most
Speaker 2: businesses fail within five years. Now, if you're fortunate enough
Speaker 2: to own a big company like one of the big
Speaker 2: banks or insurance companies, they may be going now for
Speaker 2: one hundred hundred and fifty years, but they are you know,
Speaker 2: the pointy point zero zero one of a percent of
Speaker 2: companies that have ever been established. So do I have
Speaker 2: the skills to figure out what companies are going to
Speaker 2: be around at that point in time in the future.
Speaker 2: Absolutely not. And this is where the whole idea of
Speaker 2: index investing, which I disagree with, but it's been a
Speaker 2: very palatable format for people to invest in. This is
Speaker 2: why people invest in passive index funds because they don't
Speaker 2: have to pick the winners. They just have to pick
Speaker 2: the exposure to whatever the market is going to be
Speaker 2: at that point in time. Now, that's a great way
Speaker 2: for preserving wealth, but you're not going to outperform anything,
Speaker 2: You're just going to keep it stagnant, and over time
Speaker 2: your wealth is going to deteriorate relative to the winners
Speaker 2: who pick the best assets. So I look at that
Speaker 2: and think that's not going to make your wealth last long.
Speaker 2: And this is where to me, bitcoin is a complete
Speaker 2: anomaly because I believe bitcoin is our first risk free asset.
Speaker 2: It's not our volatility free asset. And there's a key
Speaker 2: distinction between that. But if you're thinking in generational terms,
Speaker 2: you can buy bitcoin and know that, Okay, you can
Speaker 2: deal with a bad two or three years because you
Speaker 2: know we're planning for thirty fifty eighty, one hundred, two
Speaker 2: hundred years. In fact, we've got one client who's planning
Speaker 2: for trying to have a two hundred year plan for
Speaker 2: his legacy, and it revolves around his business and bitcoin
Speaker 2: backing it and funding his vision for the future. Now,
Speaker 2: no other asset would I have confidence in to fund
Speaker 2: a two hundred year plan With bitcoin, I certainly believe it.
Speaker 3: Let's dig into that a little bit.
Speaker 1: So it's the longest lasting Like obviously a house is
Speaker 1: probably not going to last that long. I mean, there
Speaker 1: are some that are a few several hundre years old,
Speaker 1: that they have to be rebuilt and whatnot rate. So
Speaker 1: obviously a car, you know, businesses most likely are not
Speaker 1: that long.
Speaker 3: So I get that.
Speaker 1: However, does that assume and that means that it's an
Speaker 1: asset that you could just buy it and never touch
Speaker 1: it again for twnity years Because I could just sell
Speaker 1: one property for another, I could rehab the property, I
Speaker 1: could sell this business buy a different business, So I
Speaker 1: could manage that well through real estate and businesses. But
Speaker 1: bitcoin is more like a hands.
Speaker 2: Off approach completely.
Speaker 3: And what I mean is that a big deal?
Speaker 2: No? I think it's a huge deal because every time
Speaker 2: you transact, you're subjecting yourself to a number of different things. Firstly,
Speaker 2: your personal judgment to outperform the market, that you're going
Speaker 2: to improve the capital allocation. Secondly, and a big one
Speaker 2: is typically there's a tax consequence for every transaction that
Speaker 2: you make, and if you're making multiple transactions in that
Speaker 2: two hundred year period, you're going to be taxed multiple times.
Speaker 2: So if you look at say, typical tax regime in
Speaker 2: the US on capital gains would be circa thirty percent.
Speaker 2: Now if you do that four times in one hundred years.
Speaker 2: That's only one transaction every fifty years, you're going to
Speaker 2: end up with less than forty percent of the original
Speaker 2: capital that you had.
Speaker 1: That's well, I mean, assuming the capital doesn't grow, yes,
Speaker 1: but let's look.
Speaker 2: At it in bitcoin terms. If you bought and solid
Speaker 2: bitcoin four times and incurred that thirty percent fight four times,
Speaker 2: you'd have less than forty percent of the original bitcoin
Speaker 2: that you started with.
Speaker 1: You can think of that tax almost as volatility, right,
Speaker 1: So when when an asset draws down by thirty percent,
Speaker 1: it has to make a sixty percent just to get
Speaker 1: back to even So if you make that transaction, thirty
Speaker 1: percent goes to taxes, Now that next transaction has to
Speaker 1: go up by at least sixty percent just to get
Speaker 1: you back to where you were. Right. So that's sort
Speaker 1: of how that that volatility, if you want to call
Speaker 1: it that of the tax taxation will really draw down
Speaker 1: on your long term gains correct plus to your point,
Speaker 1: I did like that, I mean, then that draws on
Speaker 1: your own judgment. And so when you're thinking about two
Speaker 1: hundred years now, you're depending on the judgment of all
Speaker 1: those errors down the line that they're going to make
Speaker 1: good judgment, which is probably probably pretty hard to view. Okay,
Speaker 1: so that's the longest lasting meaning. I can set it
Speaker 1: and forget it. I'm not subject to all the different transactions,
Speaker 1: the subjection of people's interpretation of markets at that time
Speaker 1: and whatever. Then you said it's the best performing asset.
Speaker 1: Now we certainly know factually it has been the best
Speaker 1: performing asset in the world. Some people still think it's
Speaker 1: a magic Internet money. You said that pretty matter of factly.
Speaker 1: So why do you think it's going to be continue
Speaker 1: to be the best performing asset in the world.
Speaker 2: On the most basic of premises, I believe in humanity,
Speaker 2: and I think we will evolve, not to evolve. If
Speaker 2: you believe that we are going to improve and our
Speaker 2: lives are going to get better, then Bitcoin is going
Speaker 2: to fundamentally accrue more value and grow into the future.
Speaker 2: If I look at all of the avenues of capital
Speaker 2: and the places of capital where they are stored, and
Speaker 2: how they move, how they are used, Bitcoin is an
Speaker 2: insignificant market in relative terms to the bond market, stock market,
Speaker 2: property market. Look at with a deep understanding across all
Speaker 2: of those asset classes and how that compares to bitcoin,
Speaker 2: and it will be a one way valve, there'll be
Speaker 2: a drain of capital from each of those large assets
Speaker 2: into bitcoin. And so what does that do at a
Speaker 2: time when Bitcoin is becoming more and more scarce, so
Speaker 2: there's less and less coins on exchange. Bitcoin will as
Speaker 2: the market cap grows, we'll be able to access bigger
Speaker 2: and bigger capital pools. So you have larger capital pools
Speaker 2: trying to find less bitcoin. And I look at this
Speaker 2: and think, this capital appreciation in bitcoin hasn't yet started.
Speaker 2: A lot of people think, oh, well, it's been the
Speaker 2: best over the last fifteen years, it can't go any further,
Speaker 2: but they fail to understand that there's a host of
Speaker 2: reasons why this little asset cooled bitcoin that is inconsequential
Speaker 2: in global terms, can take on an infinite infinite amount
Speaker 2: of capital. And to me, I look at the future
Speaker 2: and think, there's no other asset that I want to
Speaker 2: be holding other than bitcoin. If you want to capture
Speaker 2: that upside and bring this full circle to one of
Speaker 2: the points you made earlier, this is really one of
Speaker 2: the It's a real dichotomy because you have what people
Speaker 2: think is a volatile asset, which is actually a risk
Speaker 2: free asset when you understand it and it's the best
Speaker 2: performing asset that you want to put in a portfolio
Speaker 2: that is going to preserve your wealth. So a lot
Speaker 2: of those things just do not marry up to what
Speaker 2: you would think is a sensible investment decision. And this
Speaker 2: is where when people look at it without studying, I
Speaker 2: think they suffer cognitive dissonance because a lot of those
Speaker 2: things can't be true at the same time, and bitcoin
Speaker 2: is the first time that those things are true.
Speaker 1: I want to take a second, just real quick, to
Speaker 1: just give you a reminder. The reminder is take control
Speaker 1: of your bitcoin. Look, for the first time in history,
Speaker 1: we have a way to preserve our property, take custody
Speaker 1: of our property and protect it with no cost. You
Speaker 1: can't do that with gold, you can't do it with
Speaker 1: your stocks, and so we can do with bitcoin.
Speaker 3: And you should.
Speaker 1: Now don't store it on an app on your phone
Speaker 1: that can get half. What you want to do is
Speaker 1: use a hardware device something like this treasure right here.
Speaker 1: So basically your private key sits here. When you want
Speaker 1: to do a transaction, you plug it into your computer,
Speaker 1: sign the transaction. When you're done, you unplug it and
Speaker 1: put it back into your safe. I've used Treasure for now,
Speaker 1: I don't know six seven years, because I think it's
Speaker 1: the easiest one to use. I've tried, I think pretty
Speaker 1: much all of them. And it's also open source so
Speaker 1: you can trust the code. And again it's easy. Why easy,
Speaker 1: Because if it's too complex, it makes me think of
Speaker 1: how many potential holes and risk there could be, not
Speaker 1: just in the device itself, but even in my own
Speaker 1: ability to secure it. So I want something fast, I
Speaker 1: want something easy. I don't want something safe. That's why
Speaker 1: I use Treasure. And if you don't use Treasure, use something.
Speaker 1: Please get your bitcoin off the exchange, use a hardware
Speaker 1: device to secure your private key, and if you like Treasure,
Speaker 1: check out the link down below. What do you think
Speaker 1: about somebody like Larry Fink who went on TV a
Speaker 1: couple of weeks ago and said, hey, I I think
Speaker 1: that bitcoin's a legit asset. Everyone should take another look
Speaker 1: at it for example, right, and we've seen many examples
Speaker 1: of that. Trump was just speaking about bitcoin and the
Speaker 1: importance of bitcoin after a couple of years ago, seeing
Speaker 1: that he thought it was a scam and whatever rate
Speaker 1: are those people just changing their mind to jump on
Speaker 1: the bandwagon providing a lip service. Does Larry Fink, you know,
Speaker 1: just want to pump up his own book or do
Speaker 1: you think it's possible that people can actually do research
Speaker 1: and change their owner.
Speaker 2: I think Larry has found something. I think Larry is
Speaker 2: sincere in the interviews that you're referring to. I think
Speaker 2: he has done an enormous amount of work that as
Speaker 2: bitcoiners were not privy to, and I think he's got
Speaker 2: a huge amount like a huge team around him with
Speaker 2: really smart people who are giving him arguably the best information.
Speaker 2: Now Wall Street are full of really smart guys. But
Speaker 2: if you look at Larry Fink's genesis story, you realize
Speaker 2: that he wanted to token ask the world back in
Speaker 2: nineteen eighty and it started with residential mortgage backed securities.
Speaker 2: Now I look at the work that he's doing with
Speaker 2: the ETF and there's an opportunity for Larry to, I believe,
Speaker 2: create the world's greatest investment product, which he tried to
Speaker 2: do with the residential mortgage backed securities. That was an
Speaker 2: attempt to tokenize real estate or real estate globally. That
Speaker 2: led to a catastrophic failure in the GFC because, as
Speaker 2: you and the prelude to that was you had the
Speaker 2: investment banks wanting to monetize that product upfront and then
Speaker 2: export the risk to main street and pension funds globally. Sadly,
Speaker 2: this led to a credit boom, This led to the GFC.
Speaker 2: But what happened with that credit boom and GFC was
Speaker 2: there was an insatiable demand from Wall Street to create
Speaker 2: more products of that mortgage back security then on sell it, however,
Speaker 2: and that meant that the main street lenders had to
Speaker 2: go out the risk curve to find poorer and poorer
Speaker 2: quality borrowers to fulfill that need. And this is what
Speaker 2: led to the ninja lines and no income, no job
Speaker 2: applicant line fabulous. We loved it until we didn't. And
Speaker 2: this is the problem is that Wall Street monetized it
Speaker 2: and took all the profits and no risk, and they
Speaker 2: exported all the risk. And then when the poor retail
Speaker 2: borrower who couldn't afford a million dollar mortgage on the
Speaker 2: salary of someone stacking shells led to the underpinning of
Speaker 2: and the cascading of values across the world. Now I
Speaker 2: look at that and I think what happens if we
Speaker 2: get a principal protected note and Larry starts issuing that
Speaker 2: where he marries up a five year US treasury with bitcoin,
Speaker 2: and so you get a capital guaranteed note where they
Speaker 2: issue a ten billion dollar note. Eight billion goes into
Speaker 2: a five year treasury. That five year treasury grows from
Speaker 2: eight billion to ten billion in the five years, and
Speaker 2: then they get to then invest two billion dollars into bitcoin.
Speaker 2: And that way, if you put in a million dollars,
Speaker 2: the worst result you can achieve in five years is
Speaker 2: five is your million dollars back. But this gives an
Speaker 2: opportunity for Larry to effectively tokenize the world, and this
Speaker 2: is ultimately what he wants, and he can achieve that
Speaker 2: with US backed US government BACKDT and coupling that to Bitcoin,
Speaker 2: both of which are risk free. And then that takes
Speaker 2: all of the risk away from retail, retail investors, retail
Speaker 2: moms and dads, and it puts it firmly and squarely
Speaker 2: on the shoulders of the two risk free assets in
Speaker 2: the world that we've got, which is US government treasuries
Speaker 2: and bitcoin.
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Speaker 3: I agree.
Speaker 1: I mean when I listened to Larry Fink, he doesn't
Speaker 1: just say, oh I like it, you should buy it.
Speaker 1: He gives the reasons, like the mechanisms, the supply demand mechanisms,
Speaker 1: of why it makes sense, of what it protects you from,
Speaker 1: of why it goes up. And so to me, that
Speaker 1: gives me like a level I think he shows demonstrates
Speaker 1: that he has a level of understanding about it, not
Speaker 1: just lip service. I think it's crazy for people to
Speaker 1: think that you just can't change your mind. I mean,
Speaker 1: the smartest people in the world change their mind, probably
Speaker 1: the most right. I think a sign of intelligence is
Speaker 1: how quickly you can change your mind based off of
Speaker 1: new information that you've received.
Speaker 3: So it.
Speaker 1: It never ceases to amaze me. And I suppose this
Speaker 1: is an example of how closed minded some people are.
Speaker 1: It's like, oh, but he said that five years ago.
Speaker 2: Well, I think credit to Larry. He has done a
Speaker 2: great job in changing tackle that. I think it's very difficult.
Speaker 2: One of the touring points he most recently made where
Speaker 2: I genuinely feel like he understands the problem. I haven't
Speaker 2: heard him talking about debasement of the dollar now. He
Speaker 2: talked about the devisement of the dollar in America. He
Speaker 2: talked about the de basement of dollars around the world.
Speaker 2: He clearly understands the problem of the money printing and
Speaker 2: how bitcoin solves it. So hats off to Larry, like
Speaker 2: one of the smartest people in the world and arguably
Speaker 2: the greatest salesman.
Speaker 1: Now getting back to the question that kind of that
Speaker 1: led into this, which was I was just asking sort
Speaker 1: of you had made a statement that it's the best
Speaker 1: performing asset, and so again I said it's the best.
Speaker 1: It has been the best performing. Let's think about the
Speaker 1: forward projection of this. Michael Saylor laid out some math
Speaker 1: which we're going to link to Michael Sailor's interview down
Speaker 1: the presentation down below at the Bitcoin Conference in twenty
Speaker 1: twenty four. It's certainly worth a watch. And Michael Saylor
Speaker 1: sort of laid out this twenty one year projection and
Speaker 1: he gave sort of three price models bear, bear, medium,
Speaker 1: and bowl or whatever it was.
Speaker 3: I thought it was pretty good.
Speaker 1: Certainly might be conservative on the barecase over aggressive on
Speaker 1: the ballcase. I don't know, you think maybe the math
Speaker 1: might be a little bit off. Maybe where do you
Speaker 1: think the math is when you're looking at the projection?
Speaker 3: Right?
Speaker 1: So this is where a lot of people get things wrong. Right, So,
Speaker 1: when you're investing your money, like I always tell people, like,
Speaker 1: you need to know what you're expecting when you get
Speaker 1: in right, Where do.
Speaker 3: I think it can go over what time frame? What
Speaker 3: are my risks? You have a plan for that.
Speaker 1: So if you're advising your high net worth individuals on
Speaker 1: buying bitcoin, where do you lay that out? How do
Speaker 1: you project that out?
Speaker 2: I think it comes down to a whiting to start with.
Speaker 2: So you need to understand what the risk profile is,
Speaker 2: to understand what they can and can't sleep with. So
Speaker 2: I urge any client to invest however much they can
Speaker 2: invest without losing any sleep. Now, I typically start that
Speaker 2: conversation at ten percent. For families, that's an inconsequential amount
Speaker 2: of wealth. It's embarrassing if they lose it, but it
Speaker 2: doesn't change anything in their life. It doesn't change where
Speaker 2: the holiday, where the kids go to school, where they live.
Speaker 2: Nothing changes now.
Speaker 3: Just real quick.
Speaker 1: So ten percent, Now, I could put one hundred percent
Speaker 1: of my wealth in and have a ten percent stop loss.
Speaker 1: It's only risking ten percent. Or I could put ten
Speaker 1: percent of my wealth in and have a zero percent
Speaker 1: stop loss. So I'm just curious on that because the
Speaker 1: chance of Big one going to zero is highly unlikely.
Speaker 1: I mean it's not even probable, right, It could draw
Speaker 1: down fifty or seventy five percent. So if they put
Speaker 1: ten percent in lost half of that, that's.
Speaker 3: Kind of inconsequential.
Speaker 2: I agree, And this is where it's a long game
Speaker 2: and people take a long time to understand it. Because
Speaker 2: as simple as it is, twenty one million and that's
Speaker 2: all I really need to understand. There are so many
Speaker 2: other factors that they need to understand in order to
Speaker 2: get comfortable with putting in additional capital. We like clients
Speaker 2: to hold the underlying because we think that's going to
Speaker 2: create the greatest optionality moving forward. And we try and
Speaker 2: veer away from ETFs and the rest of it, because
Speaker 2: if you want maximum optionality, you want to hold the underlying. Now,
Speaker 2: a ten percent allocation drops fifty percent. I always tell
Speaker 2: my clients, now, whatever you put in and you make
Speaker 2: that initial purchase, just be sure to understand that this
Speaker 2: could drop fifty percent tomorrow, and then I'm going to
Speaker 2: come back and ask you for another ten percent to
Speaker 2: put in the next day when it's dropped fifty percent,
Speaker 2: so we can dollar cost average into it now on
Speaker 2: a new investment. I haven't met a client yet who says,
Speaker 2: you know what, that's a great idea, here's my money,
Speaker 2: let's do it. It takes a long time. It's takes
Speaker 2: a lot of education to get a client comfortable with
Speaker 2: a serious allocation. By serious, I mean anything over five percent.
Speaker 1: And that's a really good point that I'll just hit
Speaker 1: on for a second. I want to get back to
Speaker 1: the price predictions. But just hit on that for a second,
Speaker 1: which is for these high net worth individuals, family offices
Speaker 1: and institutions to make a move, it doesn't happen quickly. Yeah,
Speaker 1: there's big numbers, there's a lot of information they have
Speaker 1: to take in, there's a lot of education they have
Speaker 1: to overcome, and a lot of times there's a lot
Speaker 1: of decision makers that have to be involved in this, right,
Speaker 1: And I just want to hit that point. Wait, because
Speaker 1: you know, with what's happened in the ETFs and black Rock,
Speaker 1: and you know now President's talking about it, a lot
Speaker 1: of questions might be we'll WHI aren't more people buying then,
Speaker 1: and I would say they are, or more specifically, they're
Speaker 1: getting ready to correct. Just as an antidotal piece of information.
Speaker 1: In twenty twenty one, I went and spent the year
Speaker 1: in Puerto Rico. In Puerto Rico sort of this Galt's gulch,
Speaker 1: where like all the rich people are moving over there, right,
Speaker 1: and my friends over there were some of the some
Speaker 1: very very I'm not going to name drop them, but
Speaker 1: very very influential, like hedge fund managers and like very
Speaker 1: very established investors, you know, billion dollar funds, et cetera.
Speaker 1: One of my probably best friends over there at the time.
Speaker 1: He he doesn't believe in bitcoin.
Speaker 3: He's a trader.
Speaker 1: He's a very well known name, super brilliant, like amazingly brilliant.
Speaker 1: And he bought bitcoin at like eighteen thousand in the fund,
Speaker 1: sold it at like forty five thousand, like crushed it
Speaker 1: for his fund, right, But he just is like, no,
Speaker 1: I just whatever, Like I kind of like Monaro makes
Speaker 1: sense because it's private, but like not Bitcoin whatever. He's
Speaker 1: like to me, it's just a trading toy. That's always
Speaker 1: been his approach to it. That being said, about a
Speaker 1: month ago I talked to him and he's been out
Speaker 1: since it was there in the forty five forty eight
Speaker 1: thousand range or whatever. About a month ago he said,
Speaker 1: Bitcoin is now the single largest position my fund has.
Speaker 3: Amazing And I said why.
Speaker 1: And it's not because all of a sudden he believes
Speaker 1: in it. He's a trader, he said. If you knew
Speaker 1: the amount of billionaires that have called me and asked
Speaker 1: me how they can get into this and secure it
Speaker 1: for a long period of time because of the craziness
Speaker 1: of what's going on in the world, you would understand
Speaker 1: why I'm so bullish, and so I just say that
Speaker 1: story just to say, like, we do have all these
Speaker 1: people that are trying to get in to the point
Speaker 1: that you're making. Right, there's a lot of education have
Speaker 1: to overcome. It's coming. Would you say that's fair? Is
Speaker 1: that kind of what you've seen in your own experience?
Speaker 2: Absolutely, And this is the only asset that is ex legal,
Speaker 2: So it's outside of the purview all the US government.
Speaker 2: It's beyond they touch. It's about the only thing that
Speaker 2: can be other than physical gold and physical goal. We
Speaker 2: all now has its on constraints.
Speaker 1: Okay, so let's get back to the price prediction. So
Speaker 1: Michael Saylor sort of laid out this twenty one year
Speaker 1: plan by twenty forty five, and it would have a
Speaker 1: base case of thirteen million or sorry, let's start with
Speaker 1: a barecase of three million dollars per bitcoin, a base
Speaker 1: case of thirteen million dollars per bitcoin, and a bowl
Speaker 1: case of forty nine million dollars per bitcoin. I thought,
Speaker 1: you know, it was thoughtful. He said that right now
Speaker 1: currently bitcoins had a compoundent and a growth rate of
Speaker 1: about one fifty but right now we're having about a
Speaker 1: fifty five percent ar and he says, you know this,
Speaker 1: this decelerates fifty to forty five, thirty whatever and finally
Speaker 1: stabilizes around twenty, which is about double what the S
Speaker 1: and P five hundred is. Now, you've mentioned the scarcity
Speaker 1: many times. Double the S and P five hundred like
Speaker 1: that seems super ultra conservative to me. But you think
Speaker 1: maybe some of those numbers are off just a little.
Speaker 2: And I think we all love Michael Saylor. I think
Speaker 2: he's Bitcoin's greatest proponent.
Speaker 3: We're all lane, none of us know the future. We
Speaker 3: don't know.
Speaker 2: That's true, But just if you look at his work
Speaker 2: in there, one of his final comments in that speech was,
Speaker 2: we have a thousand X from here now. The price
Speaker 2: at sixty five thousand dollars on the day, give or take,
Speaker 2: would mean where we've got a sixty five million dollar
Speaker 2: bitcoin coming, not a forty nine. So I think Michael
Speaker 2: would prefer to surprise to the upside as opposed to
Speaker 2: put a big number out there. Not that forty nine
Speaker 2: is not a big number. But I think there's a
Speaker 2: host of things that I disagree with fundamentally there. And
Speaker 2: if I look at this, and I think probably the
Speaker 2: lynch pin for something going substantially higher than what he
Speaker 2: lays out is the fact that we haven't had someone
Speaker 2: with a money printer being able to buy bitcoin yet,
Speaker 2: no one has done that. When we have someone do that,
Speaker 2: then that can dramatically shift that playing field for to
Speaker 2: the significant upside. When the US Federal Reserve decides to
Speaker 2: buy some and can have the ability to hold their
Speaker 2: finger down on the money printer, they can buy a
Speaker 2: limitless amount and set the floor at ten million, one
Speaker 2: hundred million, whatever they want, and now all of a sudden,
Speaker 2: we're in a completely new paradigm. So for me, it's
Speaker 2: very difficult to argue with what Michael says, and I
Speaker 2: think all of it's consistent and congruent thinking that I
Speaker 2: agree with. The only X factor that changes it to
Speaker 2: the upside, not the downside, is a government with a
Speaker 2: money printer that gets involved and says we're going to
Speaker 2: set the floor.
Speaker 1: Yeah. I mean, I think that is maybe a little
Speaker 1: bit baked into the cake in a sense, because you're
Speaker 1: saying that it's projected to capture seven percent of the
Speaker 1: world's assets, and so if you think about it, I mean, really,
Speaker 1: we have this amount of assets, so I like to
Speaker 1: think I laid out a case that there's like three
Speaker 1: ways I would think about valueing bitcoin in the future.
Speaker 1: So like the venture capital method. So like uber told
Speaker 1: took money from taxis and limos and vans, So if
Speaker 1: I got five percent from each of those, it's worth this, right,
Speaker 1: And so then we can look at the total value
Speaker 1: bitcoin could be pulling from. So Michael Sailor laid out
Speaker 1: with nine hundred trillion dollars in assets effectively, so we
Speaker 1: get seven percent of that for example, Right, I think
Speaker 1: if if a sovereign were to buy it, it would
Speaker 1: just get to that percentage of global assets faster. Right,
Speaker 1: So I want to get back to that because of
Speaker 1: what Trump's announcement was. But I also think about it
Speaker 1: in the sense of not just if a government were
Speaker 1: to buy it, but the rate of debasement that we're
Speaker 1: facing in the future. So Michael Howell, in my opinion,
Speaker 1: probably the best in mapping out global liquidity flows. And
Speaker 1: so it's not just looking at what the FED balance
Speaker 1: sheet is, but the major central banks of the world.
Speaker 1: And you can see that the S and P five
Speaker 1: hundred is basically moving in lockstep with the global liquidity. Yes,
Speaker 1: so about twelve percent so it looks on paper you're
Speaker 1: going up with your purchasing powers and growing. But bitcoin,
Speaker 1: so gold has a one point four to nine sensitivity ratio.
Speaker 1: So for every ten percent in liquidity, gold goes up
Speaker 1: by four teen percent a little bit better. But bitcoin
Speaker 1: has an eight point nine times since to be so
Speaker 1: for every ten percent in liquidy, biccong goes up by
Speaker 1: ninety percent. So you could just look at to the point,
Speaker 1: you know, I guess if the central banks use debt,
Speaker 1: but that expansion of the monetary base, and all we
Speaker 1: have to do is look at the projections by the
Speaker 1: government In the US, the Congressional Budget Office CBO tells
Speaker 1: us what it's going to be by twenty fifty, right,
Speaker 1: and so that's one way to look at it. So
Speaker 1: not only could it capture seven percent of the world's assets,
Speaker 1: but today they're at nine hundred trillion. Those assets could
Speaker 1: be one point four quadrillion by the time it gets
Speaker 1: set seven percent, and that's where it's probably undershot to
Speaker 1: the downside.
Speaker 2: That's it. And this is where I look at things
Speaker 2: a little differently, in that if we look at the ultrawealthy,
Speaker 2: we look at Alon, we look at Jeff Bezos. They
Speaker 2: store their wealth in the companies that they own because
Speaker 2: they've got the most control over it. I believe that
Speaker 2: that has the most significant upside. They're not ninety nine
Speaker 2: percent of their wealth would be stored in these assets
Speaker 2: that they've built from the ground up. They're not spending
Speaker 2: one hundred percent of their wealth perannum they would be
Speaker 2: spending I would have thought zero point one of a
Speaker 2: percent of the wealth parannum. That seems like a pretty
Speaker 2: fair assessment what I look at. And this is where
Speaker 2: I think bitcoin completely redefines this is this gives everyone
Speaker 2: on Earth. It democratizes assets, and it gives everyone the
Speaker 2: ability to be a Jeff Bezos or Elon Musk and
Speaker 2: owned Tesla and Amazon themselves. It gives them a monetary
Speaker 2: premium into the future that has no comparison in relative
Speaker 2: terms from an investment perspective. And when you look at
Speaker 2: that and understand that price is determined at the margin,
Speaker 2: we can have so much more capital stored in bitcoin.
Speaker 2: That's going to be in percentage terms, we could see
Speaker 2: ninety nine percent of the world's wealth stored in bitcoin
Speaker 2: and only one percent is for real world assets. Because
Speaker 2: people are going to want to have that premium of
Speaker 2: being able to move their value forward into the future
Speaker 2: for future person. So I'm probably the most bullish person
Speaker 2: when it comes to that because I understand the value
Speaker 2: of optionality into the future. And this is where bitcoin
Speaker 2: is the only asset that has that fight chuck.
Speaker 1: Yeah, Now, what's interesting with bitcoin is it started in
Speaker 1: the shadowy shadow supercoder world or whatever and sort of
Speaker 1: kind of spread to the people, right, a decentralized, bottom
Speaker 1: up approach, and so it was people, people people, and
Speaker 1: eventually it got to a government in l Salvador. But
Speaker 1: that's like probably still the bottom of the government level. Right.
Speaker 1: They're one of the poorest countries in the world. We're
Speaker 1: the most dangerous county in the world. Now one of
Speaker 1: the safest. They're turning around. But to that perspective, kind
Speaker 1: of a bottom up phenomenon.
Speaker 3: Yes, and Bukeley, President Bukeley.
Speaker 1: From L Salvador, has been around talking to a bunch
Speaker 1: of other government leaders, but other small government leaders about
Speaker 1: doing something like this, and so again a bottom up approach.
Speaker 1: I always thought the US would be sort of the
Speaker 1: last move advantage out of any country because of they
Speaker 1: have the dollar, they have the most to lose. So
Speaker 1: to see two two of three presidential candidates come out
Speaker 1: and announced that they would have a strategic reserve, trying
Speaker 1: to bring it kind of on par with gold as
Speaker 1: well as even if neither of them win. We also
Speaker 1: have Senator Loomis who put together a bill to do that.
Speaker 1: It seems that that switches from a bottom approach to
Speaker 1: a top down approach. I mean, back to game theory.
Speaker 1: If the US announces this, then I think all the
Speaker 1: other nations are sort of forced to react to that.
Speaker 1: Currently in the betting markets, Trump is favored to win
Speaker 1: by fifty six percent, and if he wins, I think
Speaker 1: he would probably do it, Like why wouldn't he?
Speaker 3: So that's basically.
Speaker 1: Giving us, at this point, per the betting markets, at
Speaker 1: fifty six percent, odds that the US will adopt this
Speaker 1: and other nations will be forced to I guess that's
Speaker 1: the way I read it, And I'm curious what your
Speaker 1: take is on that specifically, because we haven't really seen
Speaker 1: the price of bitcoin pump based off of that news.
Speaker 2: I think there is famal indecision in the USA voters
Speaker 2: mind than what the betting markets predict. I think Kamala
Speaker 2: Kamala Harris is a much bigger threat than people are
Speaker 2: making out. I think people are very dismissive of her,
Speaker 2: and I think the Republicans have got a huge amount
Speaker 2: of work to do if they want to win this.
Speaker 2: It's not a lay down like they know well, they'll
Speaker 2: have you believe that said, this puts an enormous amount
Speaker 2: of pressure on the rest of the world that they
Speaker 2: need to act really, really quickly, and we could be
Speaker 2: much closer to the suddenly part of the gradually then
Speaker 2: suddenly than we realize because you have two of the
Speaker 2: three presidential candidates making promises. I thought Robert F. Kennedy
Speaker 2: was absolutely brilliant. He showed a deep command and understanding
Speaker 2: of bitcoin on a very deep level, and had some
Speaker 2: great policies.
Speaker 3: He really had a good script writer for.
Speaker 2: Sure, phenomenal yes, and he delivered it well. Trump, on
Speaker 2: the other hand, he made a promise that that's all
Speaker 2: he needed to make. He said, Hey, I'm going to
Speaker 2: make sure we don't sell the bitcoin, and what's ironic,
Speaker 2: three days later US government sells thirty thousand bitcoin or
Speaker 2: whatever they've sold they've put to market. I want to
Speaker 2: see a competition between the Dems and the Republicans, who
Speaker 2: are the only two feasible candidates, and I want to
Speaker 2: see them fight for bitcoin. I want to see who
Speaker 2: can put together the most outrageous policy. But to me,
Speaker 2: what we saw in Nashville was enough to say, Okay, now,
Speaker 2: anyone dismissing bitcoin as that magic Internet money sort of
Speaker 2: really needs to have a look, go away, reassess, and
Speaker 2: realize that where at this we're standing at the forefront
Speaker 2: of global adoption on a government level.
Speaker 1: And you know, one thing about these types of things,
Speaker 1: when they tease a new tax thing and then it
Speaker 1: kind of goes away. They sort of are like seeding
Speaker 1: the future almost, if you will rate decensitazos to the future.
Speaker 1: And so even if this doesn't go through right now,
Speaker 1: it's the direction in which we're going. And so if
Speaker 1: you're a long term thinker, you should certainly be paying
Speaker 1: attention to these these signals right there. They're they're there,
Speaker 1: we're going in this direction. And I would imagine that
Speaker 1: even if Kamala wins, and even if the US doesn't
Speaker 1: go this direction now, other nations are probably paying attention
Speaker 1: to go, well, maybe we should try to front run that,
Speaker 1: would you say?
Speaker 2: So, it's the only logical thing to do. Yeah, there's
Speaker 2: only one way to Like, you can't win by not playing.
Speaker 2: You have to ender the field and you have to
Speaker 2: stop playing otherwise you completely lose. So I look at
Speaker 2: this and I think, effectively you've been gifted by the
Speaker 2: US government or their proxies in RFK, Junior and Trump
Speaker 2: an intent of what they are going to do. Yeah,
Speaker 2: if I was any other country with a money printer,
Speaker 2: the finger would be on the button now and I
Speaker 2: would be sating whatever.
Speaker 1: It is just a money printer though, right so right
Speaker 1: now we have like the rise of the bricks, and
Speaker 1: the bricks are deciding to recycle their profits their reserves
Speaker 1: not in back into US treasuries, but instead of gold. Yeah,
Speaker 1: you got to save it something. And so like, well,
Speaker 1: we don't trust US treasury Moore, after you've took in
Speaker 1: Russia's or whatever, like you're debasing, We're not going to
Speaker 1: do that.
Speaker 3: What is by gold?
Speaker 1: And so it's not to say a money printer, but
Speaker 1: like where do they say, and so they could certainly
Speaker 1: do that into bitcoin. Let's sort of transition this and
Speaker 1: as somebody who advises hang that worth individuals and families
Speaker 1: on how to get into this, just how can we
Speaker 1: generally advise the arden. So Michael Sailor lead out sort
Speaker 1: of what do you call it? A normy strategy, a
Speaker 1: ten percent, a bitcoin maximalist strategy, and a double and
Speaker 1: triple maxi strategy. So what would your normy, maximalist and
Speaker 1: triple maxi strategies be that you would advise somebody on.
Speaker 2: It really comes down to a personal preference. But I
Speaker 2: think you've got to start with an allocation that someone
Speaker 2: is comfortable or willing to lose. Now, this is counterintuitive,
Speaker 2: but people need to learn, and Bitcoin's made around for
Speaker 2: fifteen years. The belief that people will voluntarily learn about
Speaker 2: this new asset class and spend one hundred hours going
Speaker 2: down the rabbit hole and figuring things out, I think
Speaker 2: is a complete furfee that is not going to happen.
Speaker 2: What I would prefer to do as an advisor is
Speaker 2: walk clients to the deep end, tell them to buy
Speaker 2: ten percent, and literally push them in the deep end,
Speaker 2: and then ensure that there's a life raft, a stick,
Speaker 2: something to pull them out and make sure that they're
Speaker 2: not going to hurt themselves. Because once they're in the
Speaker 2: deep end and they're finding for their lives and trying
Speaker 2: to learn as much about it. They're incentivized now they
Speaker 2: have skin in the game to actually go down that
Speaker 2: rabbit hole and start learning about it. And once they
Speaker 2: learn about it, they're going to apply more capital to it.
Speaker 2: So I think the more capital you can get someone
Speaker 2: to allocate at the beginning, the bigger they're incentive to learn.
Speaker 2: The faster they learn, the more bitcoin they'll end up having.
Speaker 2: And so I think the saying from GG is the
Speaker 2: more you know, the more you buy. Yeah, And so
Speaker 2: in order to get them to that stage, though, you
Speaker 2: just need to effectively create a safe sandbox or a
Speaker 2: safe place for them to invest as much capital as
Speaker 2: they can where they're not going to get wrecked. They're
Speaker 2: not going to pay tuition fees, they're not going to
Speaker 2: get scammed out of bitcoin, they're not going to have
Speaker 2: someone Robert or altatively send it to the wrong address.
Speaker 2: That is something that you can't do with more than
Speaker 2: one or two percent of someone's capital. You can't have
Speaker 2: an a tuition fee payable of more than two percent.
Speaker 2: To me, is even one percent is unacceptable. But it's
Speaker 2: a great lesson for the rest of your capital and
Speaker 2: investment decisions moving forward. So I think and what we
Speaker 2: try to do is create a safe framework for owning
Speaker 2: the underlying asset so that clients can put in fifty
Speaker 2: eighty percent of their capital if they was so wish to,
Speaker 2: in a safe way that they're never going to lose
Speaker 2: their bitcoin, and to me, the preservation of their bitcoin,
Speaker 2: and back to that thing that we talked about at
Speaker 2: the start, that the return of capital, not the return
Speaker 2: on capital, is the most critical component. Having that custody
Speaker 2: self custody down is arguably the most important thing you
Speaker 2: can do when it comes to bitcoin.
Speaker 1: So what are the steps to that preservation of bitcoin
Speaker 1: the custody self custody that they need to be aware of.
Speaker 2: I think you want to make sure that you have
Speaker 2: got that in a way that removes every single point
Speaker 2: of failure, So you can't have a single point of
Speaker 2: failure in your custody setup. To me, having a single SEK.
Speaker 2: A lot of people talk about, hey, let's buy a
Speaker 2: hardware wallet, put all your bitcoin on that, and it's
Speaker 2: not your keys, not your cheese, so to speak to me,
Speaker 2: that represents a single point of failure because what happens
Speaker 2: if something happens to that device, or alternatively, what happens
Speaker 2: if something happens to you, who is going to access that?
Speaker 2: So how we think about preserving that bitcoin is ensuring
Speaker 2: that we remove every single point of failure from everything
Speaker 2: in that client's bitcoin life. So that means ensuring there's
Speaker 2: no single point of failure from themselves, no single point
Speaker 2: of failure from us, no single point of failure from
Speaker 2: their multi seak provider. We want to have multiple options
Speaker 2: for everything in place. And one thing that I've had,
Speaker 2: I guess a very unique experience of is going through
Speaker 2: three probates now with clients. We've been doing this for
Speaker 2: the family office side of things for the last eight years.
Speaker 2: We've sadly had three of our clients pass away. But
Speaker 2: I can tell you and something I'm very proud of
Speaker 2: that with the collaborative security protocol that we implemented for them,
Speaker 2: they were self custing, they had full control, full autonomy.
Speaker 2: But when that day came that they were no longer here,
Speaker 2: there was a seamless transition to their beneficiaries. And this
Speaker 2: is where when you start storing significant amounts of wealth
Speaker 2: in bitcoin, this becomes a significant issue that needs solving.
Speaker 2: And so the way we get round. That is to
Speaker 2: have a collaborative security protocol. We hold one off the
Speaker 2: three keys for the client. The client holds a key
Speaker 2: and the multi sea provider holds a key, and then
Speaker 2: couple that with advice, training and education around how to
Speaker 2: actually move and use that bitcoin. And one of the
Speaker 2: key pieces that I think is really important for anyone
Speaker 2: with a bitcoin setup is to have an estate planned
Speaker 2: protocol dedicated to the physical recovery if your bitcoin, because
Speaker 2: if you don't have that in place, there's no legal recourse,
Speaker 2: there's no mandate, no legal decree that the government can
Speaker 2: mandate the transfer of your bitcoin from the protocol to
Speaker 2: your as So unless you have the pragmatic recovery of
Speaker 2: your bitcoin lockdown, the legal framework for the recovery is
Speaker 2: a bit point.
Speaker 1: So collaborative custody. So instead of having one single key,
Speaker 1: I have three keys. Two of the three have to
Speaker 1: be present to sign the transaction to move the bitcoin.
Speaker 1: But in a collaborative custody I don't keep all three keys.
Speaker 1: I only keep one of them, and I use other people,
Speaker 1: for example your company and another company to hold those keys.
Speaker 1: So then if I were to die or lose my key,
Speaker 1: hopefully the other two people have their keys correct, or
Speaker 1: if something happens to one of them, hopefully the other
Speaker 1: two parties have the keys correct. That's kind of the
Speaker 1: way it works. And then if I were to die,
Speaker 1: then my trust or whatever my will could then say, hey,
Speaker 1: these two people need to sign the transaction to move
Speaker 1: the bitcoin.
Speaker 2: Correct. And when you're dealing with large amounts of wealth,
Speaker 2: the beautiful thing about that setup is is that you
Speaker 2: can create some very strong asset protection strategies. I know,
Speaker 2: we're in the US and your legal system is out
Speaker 2: of control when it comes to litigation. Having keys in
Speaker 2: different jurisdictions gives you the strongest form of asset protection
Speaker 2: that you could ever have, because all of a sudden,
Speaker 2: now there are multiple different legal jurisdictions that if someone
Speaker 2: was to ever litigate you, they need to go to
Speaker 2: different jurisdictions in order to access that coin. Are that
Speaker 2: key and ask that to sign a transaction to move
Speaker 2: the bitcoin to where it needs to be so for
Speaker 2: me moving forward, And this is just one of the
Speaker 2: other reasons why bitcoin is the ultimate asset when it
Speaker 2: comes to intergenerational wealth. This is something that can't be
Speaker 2: done with any other asset.
Speaker 3: Yeah, yeah, amazing.
Speaker 1: All right, Peter, I think we've gone over a lot.
Speaker 1: That's some good information. I want to link down to
Speaker 1: your services down below. If anybody wants to talk to
Speaker 1: you about that, Lintha, anything else that you should want
Speaker 1: to point attention to, or that you want to kind
Speaker 1: of close it out with.
Speaker 2: I think it's just an important time if you're not
Speaker 2: in bitcoin, to get into bitcoin as quickly as possible.
Speaker 2: We've got some exciting things that are to fruition, much
Speaker 2: of which we talked about today, And if you need
Speaker 2: help getting getting started, reach out to the team. We'd
Speaker 2: love to help great.
Speaker 3: Thanks so much for appreciate it.
Speaker 2: Thanks Mat