Speaker 1: So I love cycles. Like I said, I'm kind of
Speaker 1: working on this big thesis pulling a few different cycles,
Speaker 1: and I love them because you can kind of use
Speaker 1: this historical reference to kind of maybe help predict the
Speaker 1: future a little bit. And Mark Twins says, it doesn't
Speaker 1: repeeve it a rhymes. That's a big value problem of
Speaker 1: bit coin is that there's a limited twenty one million supply. Now,
Speaker 1: there had to be a certain way to issue those
Speaker 1: coins until we reach that mark. And what Sotshi came
Speaker 1: up with was an idea where every four years, the
Speaker 1: number of newly issued coins per block, every ten minute
Speaker 1: approximate block is reduced by half what we're seeing across
Speaker 1: all markets. And I am really the base of economics
Speaker 1: is people rushing to scarce assets. You could almost look
Speaker 1: at this kind of like Radalio's short and long term
Speaker 1: debt cycle theory, where he's got these oscillating waves of
Speaker 1: short term debt cycles and you've got the long term one.
Speaker 1: I talk so much about how much how many dollars
Speaker 1: have been created by the FED, but bitcoins that a
Speaker 1: global reserve asset, and so it really you need to
Speaker 1: look at the total amount of global dollar but then
Speaker 1: COVID hit and that's like a mega, mega bearish event.
Speaker 1: But that bearish event brings in focus why bitcoin is valuable.
Speaker 1: You don't have to trust your government, you don't have
Speaker 1: to trust banks. It seemed to kind of actually respond
Speaker 1: like gold did um has done. If we look at
Speaker 1: gold compared to stocks, and like the two thousand eight crash, um,
Speaker 1: it takes an initial dip but then immediately rebounds really quickly.
Speaker 1: A lot of folks think, oh, it's a store value asset,
Speaker 1: it's a risk off asset. It must perfectly be like
Speaker 1: have a perfect, perfect inverse correlation with the markets. Well,
Speaker 1: nothing perfectly does that. It there's there's an evan flow
Speaker 1: to how prices move relative to other asset prices. What
Speaker 1: happened in golden bitcoin in March twelve, that was a
Speaker 1: liquidity crunch. Uh, investors across the world, we're gonna be
Speaker 1: margin called because a lot of the institutional folks go
Speaker 1: a leverage the juice the returns they're getting margin called,
Speaker 1: and they were selling anything they could, even safe haven
Speaker 1: store value sets assets like golden bitcoin. Hey everyone, welcome
Speaker 1: to another episode of the Market Destructor Show. And today
Speaker 1: I am joined by Dan held for a second time.
Speaker 1: He's the director of growth Marketing at Cracking. Um. He's
Speaker 1: really good at mark keting, but he's also really good
Speaker 1: at forecasting or talking about where some of these kind
Speaker 1: of trends that are growing are going. And so M
Speaker 1: he's written a bunch of papers. If you haven't seen him,
Speaker 1: you definitely should. Will link to the latest one down below.
Speaker 1: But Dan, thanks so much for joining Mark. Thanks for
Speaker 1: having me excited to jam on a couple different topics today.
Speaker 1: Yeah awesome. So, UM, I know you're the director of
Speaker 1: growth marketing Cracking, but you've also been involved in a
Speaker 1: lot of other roles inside kind of the bitcoin space
Speaker 1: as well. UM, maybe just give us a little bit
Speaker 1: of background on, like you know, what you've been working on,
Speaker 1: Like how long you've been doing this kind of thing? Sure? Yeah,
Speaker 1: so I've been in the crypto space eight years, which
Speaker 1: kind of makes me a dinosaur. Yeah, I'm thirty three
Speaker 1: years old and I've got gray hairs. I don't know
Speaker 1: if you can see it on my webcam. I've got
Speaker 1: some gray hairs coming in. Um, I sort of stumbled
Speaker 1: and bubbled my way into tech. I would use this
Speaker 1: as a word of encouragement for folks who want to
Speaker 1: get into tech. It's definitely possible. UM. I was formerly
Speaker 1: worked on a small investment firm. I built a mobile
Speaker 1: app with my buddy. It was an app that was
Speaker 1: called zero block at real time market data news feeds,
Speaker 1: kind of like a block folio equivalent in terms of
Speaker 1: functionality and popularity. Back in we got up watching dot com.
Speaker 1: From there, tried out different hats of product marketing, growth marketing,
Speaker 1: and UM product across a couple of different crypto companies.
Speaker 1: I worked at Uber on writer growth and growth marketing team,
Speaker 1: so over at HQ. From there, came back to came
Speaker 1: back to Bitcoin crypto, co founded a company we got
Speaker 1: bought by Cracking. At Cracking, I stood up the growth
Speaker 1: marketing team and that's how I'm here today. But yeah,
Speaker 1: my my marketing background has been kind of a fun
Speaker 1: mix of working and UM different crypto companies, working at
Speaker 1: companies like Uber, and then also my personal brand. So
Speaker 1: it's it's been pretty exciting. Yeah, and yeah, you've you've
Speaker 1: been working on your personal brand doing a good job
Speaker 1: with that. I've I've been impressed, and I'm a marketing
Speaker 1: guy as well, so that's cool. UM So someone that's
Speaker 1: been around for this long. I mean, you've you've seen
Speaker 1: a lot, right. Uh, it doesn't sound that long, but
Speaker 1: it but it is right when you look at the
Speaker 1: time that bitcoin has kind of been here. UM. So
Speaker 1: I want to jump right in and hey, guys, let
Speaker 1: me just interrupt this interview real quick, just to plug
Speaker 1: the show sponsor, and that is block Fi. Now. Block
Speaker 1: five is doing amazing things in the bitcoin finance space.
Speaker 1: As a matter of fact, they've cracked some really big
Speaker 1: news by bringing on the x c f TC UM
Speaker 1: chair Chris gian Carlo Um. And they are one of
Speaker 1: the most transparent, most heavily regulated UM companies inside the
Speaker 1: United States, which gives me a lot of trust into
Speaker 1: what their services are. Now, I've recently did a video
Speaker 1: talking about how to retire off bitcoin and you can
Speaker 1: do that by leveraging debt and interest against bitcoin. And
Speaker 1: Block five is the number one company in the United
Speaker 1: States or maybe in the world to go to and
Speaker 1: use UM. They are leading the charge their paying interest
Speaker 1: on your bitcoin if you park it with them, or
Speaker 1: you can borrow against it. Now, as I broke down
Speaker 1: in that video, you can borrow against your bitcoin and
Speaker 1: when you take debt against it. It's not taxable. It's
Speaker 1: not a taxable event. You can use that debt for
Speaker 1: anything that you want, including to live off of, to
Speaker 1: leverage up and buy more, or roll it into another asset. UM.
Speaker 1: You can do something like I've done recently, like sell
Speaker 1: some real estate put that money into bitcoin. Now as
Speaker 1: that bitcoin price has risen, I'm able to borrow against
Speaker 1: it and go back and buy the same real estate
Speaker 1: or something similar, and I still own the bitcoin, and
Speaker 1: I also own the new asset as well. Lots of
Speaker 1: ways you can do this UM. And Block five is
Speaker 1: the company that I recommend. Down in the description, I
Speaker 1: have a link that you can click on. If you
Speaker 1: choose to use that link, you can earn up the
Speaker 1: two d fifty dollars in bitcoin just for using that link.
Speaker 1: So check out block Fine, now let's just start talking
Speaker 1: about um kind of the space and talking about the cycles. UM.
Speaker 1: So it seems like and I know you've done extensive
Speaker 1: research and writing on these subjects, and so that's why
Speaker 1: I love having you on to talk about this kind
Speaker 1: of stuff. But UM, right now, obviously bitcoin has is
Speaker 1: in this bowl market cycle. UM, it's it's starting to
Speaker 1: attract a lot of attention right now. Um, but it
Speaker 1: seems like there, you know, there are these cycles and
Speaker 1: and I'm actually working on the big thesis about all
Speaker 1: different types of cycles. But bitcoin has these cycles that
Speaker 1: like seem to operate in four years based off of
Speaker 1: having cycles. Um, you want to just explain that for
Speaker 1: a little bit. Yeah, So for those unfamiliar, those who
Speaker 1: may be new to bitcoin, bitcoin has an issuance curve.
Speaker 1: So bitcoin are issued over a certain curve over a
Speaker 1: very long period of time, and bitcoin will be issued
Speaker 1: until we hit a twenty one million hard cap. That's
Speaker 1: a big value prop of bitcoin is that there's a
Speaker 1: limited twenty one million supply. Now, there had to be
Speaker 1: a certain way to issue those coins until we reach
Speaker 1: that mark. And what Stoshi came up with was an
Speaker 1: idea where every four years, the number of newly issued
Speaker 1: coins per block every ten minute approximate block is reduced
Speaker 1: by half, and that that happens until it's like an
Speaker 1: asum totic curve, until it hits twenty one million at
Speaker 1: a very far day in the future. Now, when we
Speaker 1: look at bitcoins price in conjunction with these havings, so
Speaker 1: the moment in which that reward has dropped, or that
Speaker 1: subsidy duly minted coin is dropped in the block reward.
Speaker 1: We see a corresponding bull run occur a year or
Speaker 1: two later, and this is ocurred three times now. So
Speaker 1: you could say it's coincidental. You could say it doesn't
Speaker 1: predict the future, but certainly it means something because we
Speaker 1: see bitcoins boom bus cycle or a big bull run
Speaker 1: and then a drop correspond from that. You go having
Speaker 1: ten bull run, having bull run, having and now we're
Speaker 1: in the middle of a bull run. So these cycles
Speaker 1: are kind of like the micro cycles of bitcoin's economy, um,
Speaker 1: and they've largely let a lot of development volume, users interest,
Speaker 1: and we're in the middle of one right now. Yeah,
Speaker 1: So I love cycles. Like I said, I'm kind of
Speaker 1: working on this big thesis pulling a few different cycles,
Speaker 1: and I love them because you can kind of use
Speaker 1: this historical reference to kind of maybe help predict the
Speaker 1: future a little bit. You know. Mark Twain says it
Speaker 1: doesn't repeat it at rhymes um. And so if we
Speaker 1: look at that, now, three havings is not a lot
Speaker 1: of data. I mean, it's not conclusive evidence, but it
Speaker 1: is something, right, It's all we have, Um, it looks
Speaker 1: cych um that we kind of have. Maybe it peaks
Speaker 1: out about eighteen months after the Having cycle. Um, is
Speaker 1: that kind of what you've seen through your research. Yeah,
Speaker 1: I mean there's a window of time that it typically
Speaker 1: peaks within. And there are the last two cycles there
Speaker 1: have been a certain amount of you know, they're within
Speaker 1: a few months of each other or within a few days.
Speaker 1: Actually I forget. I forget how granular it gets. I forget,
Speaker 1: you know it Also it depends on do you do.
Speaker 1: Do you look at the cycle based on the Having
Speaker 1: to the top of the cycle, or do you look
Speaker 1: at the bottom like the bear the lowest part of
Speaker 1: the cycle to the top of the Having. And so
Speaker 1: I forget which one has which sort of time period.
Speaker 1: But yes, generally a year and a half and a
Speaker 1: half and we're looking at the peak of the next
Speaker 1: bull run. I think it was May that we had
Speaker 1: the Having, so a year plus that is May add
Speaker 1: add three to six months and we're looking at Q
Speaker 1: three Q four. Right. But um, you know, one of
Speaker 1: the things I really want to dig in with you
Speaker 1: today is that you wrote you wrote a paper talking
Speaker 1: about a supercycle, and so obviously we're having cycles, and
Speaker 1: there's three cycles that we've had so far, but you
Speaker 1: have this thesis that there's this super cycle. I like,
Speaker 1: I like that word. It sounds sounds pretty dramatic. I
Speaker 1: think a lot of people like that. Um. But I
Speaker 1: guess I guess that's kind of sits on a premise
Speaker 1: that maybe this time is different. I've been saying quite
Speaker 1: a bit that the world we're going into is not
Speaker 1: the one we've come out of, right, the FED, COVID,
Speaker 1: every change everything. But you also kind of agree that
Speaker 1: maybe I think, for your paper, um, that this time
Speaker 1: is different, and maybe this cycle is going to be
Speaker 1: quite a bit different than the last ones. I totally agree.
Speaker 1: I do think this cycle is different. And what's funny
Speaker 1: about data is if you wait till you have all
Speaker 1: the data, then the moment is probably too late. Right, So,
Speaker 1: when it comes to investing and when it comes to
Speaker 1: product decision making, because I've worked on both products and
Speaker 1: marketing teams, you have to operate with limited information. That's
Speaker 1: always the operating environment. You don't have perfect information. So, yes,
Speaker 1: we've got a couple havings. We've seen a couple of
Speaker 1: bull runs. Some go, well, we don't. This is you know,
Speaker 1: data science wise, this isn't correlated. I'm like, that's the
Speaker 1: best we've got, and it's pretty good. And certainly there's
Speaker 1: some qualitative reasons because we've got the quantitative side. There's
Speaker 1: a qualitative reason why, um, these cycles occur. Now, is
Speaker 1: this cycle different than the other cycles? This is where
Speaker 1: I coined the term supercycle most people, by the way,
Speaker 1: and I'm not even sure if you know this. I
Speaker 1: coined that term in during the bear market. UM I
Speaker 1: wrote in the Held Report, my weekly news that are
Speaker 1: I wrote in December the sort of revisiting of the
Speaker 1: um of the supercycle theory. Now in twenty you were
Speaker 1: kind of you were back then and you were kind
Speaker 1: of predict predicting that we were going to go into
Speaker 1: that at some point. Yeah, And so I think that
Speaker 1: gives it a lot more credence than a lot of
Speaker 1: people thinking thinking that I made it up during the
Speaker 1: bull run, because it's easy to be bullish in the
Speaker 1: bull run. This was in the middle of the bear
Speaker 1: market where I basically postulated that what if this cycle,
Speaker 1: what if bitcoins microcycle, this four year boom and bus cycle,
Speaker 1: what if a boon correspond with a macro bust, a
Speaker 1: macro recession, a macro depression. So macro would be like
Speaker 1: the mainstream financial world, your typical they typically have eight
Speaker 1: to ten year cycles. You could almost look at this
Speaker 1: kind of like Ray Dalio's short and long term debt
Speaker 1: cycle theory, where he's got these oscillating waves of short
Speaker 1: term debt cycles and you've got the long term one.
Speaker 1: This is bitcoins equivalent of that. So if you're Raydalio fan,
Speaker 1: I think you'll find this analogy kind of fun um.
Speaker 1: And what I hypothesize is if we have a recession
Speaker 1: while bitcoins in a bowl run, that is the make
Speaker 1: magic moment. And Bitcoin was born in the two thousand
Speaker 1: and eight financial crisis as an antidote to poor central
Speaker 1: banking policy. But Bitcoin's existence has been in largely a
Speaker 1: very very productive bull market. So what happens when people
Speaker 1: start to question the nature of their money and question
Speaker 1: the nature of their government's control over money, then Bitcoin's
Speaker 1: value props shines the most. And that's what we have now. COVID,
Speaker 1: I mean I put the COVID. It was a negative event.
Speaker 1: I'm not trying to celebrate COVID. COVID certainly made people
Speaker 1: go wake up and go, wait a second, I'm not
Speaker 1: sure if I can trust my government with my money,
Speaker 1: and it just takes that sort of moment. But this
Speaker 1: was much more intense than I even hypothesized, because I
Speaker 1: was like, Oh, there'll be a normal recession, we're due
Speaker 1: for one. But then COVID hit and that's like a mega,
Speaker 1: mega Barish event. But that Barrish event brings in focus
Speaker 1: why bitcoin is valuable. You don't have to trust your government,
Speaker 1: you don't have to trust banks, and that's where the
Speaker 1: supercycle theory, I think has a largely got a huge
Speaker 1: check mark from that event. And there's other check marks
Speaker 1: too that we can dig into later, but that one
Speaker 1: on a micro macro cycle. I think like we're having
Speaker 1: a Bitcoin bowl run in the midst of a moment
Speaker 1: when everyone comes to realize the value of bitcoin. I
Speaker 1: don't think we're going to see a normal price movement
Speaker 1: of We can go into some numbers, some of the
Speaker 1: predictions that you know, I would say an aggregate analyst
Speaker 1: are predicting, Yeah, yeah, I want to dig into that. Well, well,
Speaker 1: we're gonna leave that towards in make sure everybody sticks
Speaker 1: around and listen to kind of those numbers of where
Speaker 1: we were maybe we're going. But I guess to kind
Speaker 1: of dig into what you said, obviously that makes sense, right,
Speaker 1: people are all of a sudden starting to go, what
Speaker 1: the heck is happening to our money? The money sippply
Speaker 1: was created the last twelve months, all those things. UM,
Speaker 1: So I think I think there was that distrust that
Speaker 1: was like the psychological factor. But then we did have
Speaker 1: six seven trillion dollars dumped into the markets, so we
Speaker 1: have we have that as well, So I think it's
Speaker 1: kind of it's getting it from both sides, right, a
Speaker 1: rush of liquidity into the markets. Um. And the other
Speaker 1: thing I think is that what we're seeing across all markets,
Speaker 1: and i'm's really the base of economics is people rushing
Speaker 1: to scarce assets. And so we're seeing you know, the
Speaker 1: best beach runner lake from property going up way more
Speaker 1: than other properties, for example. And so bitcoin might be
Speaker 1: the most scarce financial asset, and maybe that's one reason
Speaker 1: why it's going to more than others. Certainly bitcoin's moment
Speaker 1: to shine as a twenty one million fixed supply comes
Speaker 1: into focus. In this sort of moment, we're seeing other
Speaker 1: scarce assets like gold and real estates start to go
Speaker 1: up in price. Two. I'm going to Austin this weekend
Speaker 1: of visits of friends, and I've noticed that the apartment
Speaker 1: has come back. I'm I'm moving out there in a
Speaker 1: month and a half. Yeah, it's it's already set in stone.
Speaker 1: We're just figuring out where we want to live. I
Speaker 1: did a scouting mission before in terms of checking out
Speaker 1: different neighborhoods, but now it's time to go put some
Speaker 1: ink on paper and make it happen. So I'm thrilled.
Speaker 1: I'm a Texan. So I've been out in California, in
Speaker 1: San Francisco for eight years, working in tech. Still gonna
Speaker 1: work in tech. It's time to come home. Um, tax
Speaker 1: wise and personal belief wise. I just feel like I'm
Speaker 1: more comfortable out there. Um when it comes to you know,
Speaker 1: the what we're seeing is, you know, when we look
Speaker 1: at inflation numbers, and we look at inflation calculations like CPI,
Speaker 1: they don't include a lot of metrics or a lot
Speaker 1: of prices that are inherent to living. They exclude some
Speaker 1: of these costs, which is ridiculous, Like, for example, they
Speaker 1: only include rent, but they don't include the the rise
Speaker 1: in in the average home price. So we're seeing acid
Speaker 1: bubbles occur in equities and in real estate, where it's
Speaker 1: very symptomatic of all this money printing. And by the way,
Speaker 1: I looked this metric up recently, it's twenty five trillion
Speaker 1: dollars that have been printed globally during COVID by governments
Speaker 1: trillion and bitcoins only at a trillion dollar market cap. Yeah,
Speaker 1: these are the sort of moments when you just realize
Speaker 1: the size and the enormity of the value prop for
Speaker 1: a bitcoin, the the total dress ball market of what
Speaker 1: bitcoin can evolve and grow into in terms of size. Yeah,
Speaker 1: that's a great point. You know, I talked so much
Speaker 1: about how much how many dollars have been created by
Speaker 1: the FED, but bitcoins are a global reserve asset and
Speaker 1: so really you need to look at the total amount
Speaker 1: of global dollars and so that's a that's a great
Speaker 1: point you bring up. Now, Um, you did mention that
Speaker 1: bitcoin was created, you know, in the two thousand nine
Speaker 1: kind of as a response to two crash um, and
Speaker 1: so it's it's you know, pretty apparent that bitcoin hasn't
Speaker 1: really seen a big bear market, and so you know,
Speaker 1: there's always the debate between you know, is it risk on,
Speaker 1: is a risk off? You know, where does that fit? Um?
Speaker 1: But I think that you know, what happened last year
Speaker 1: and that COVID plunge or whatever you want to call that,
Speaker 1: it seemed to kind of actually respond like gold did
Speaker 1: um has done. If we look at gold compared to stocks,
Speaker 1: and like the two thousand eight crash, UM, it takes
Speaker 1: an initial dip but then immediately rebounds really quickly. And Uh,
Speaker 1: I think we kind of saw that. Does that kind
Speaker 1: of give you maybe a little bit of taste of
Speaker 1: what we may expect from that in the future. Yeah,
Speaker 1: great question. So a lot of folks think, oh, it's
Speaker 1: a store value asset, it's a risk off asset. It
Speaker 1: must perfectly be like have a perfect, perfect inverse correlation
Speaker 1: with the markets. Well, nothing perfectly does that. There's there's
Speaker 1: an ebb and flow to how prices move relat to
Speaker 1: other asset prices. What happened in golden bitcoin in March
Speaker 1: that was a liquidity crunch. Uh, Investors across the world,
Speaker 1: we're getting margin called because a lot of the institutional
Speaker 1: folks go leverage to juice the returns. They're getting margin
Speaker 1: called and they were selling anything they could, even safe
Speaker 1: haven store value sets assets like golden bitcoin. So I
Speaker 1: think that um, that moment was a good example of
Speaker 1: a liquidity crunch, not necessarily a lack of confidence in
Speaker 1: bitcoin or gold as a global store of value asset. Um,
Speaker 1: what's kind of cool about bitcoin is that bitcoin as
Speaker 1: referenced by Jerome Powell, the Chairman of the Federal Reserve,
Speaker 1: he states that bitcoin is a speculative store of value.
Speaker 1: I think that encapsulates this perfectly. It's inherent properties make
Speaker 1: it a good long term risk off asset, but it's
Speaker 1: price volatility is very much a speculation as to its
Speaker 1: future utility of a store of value asset. But what's
Speaker 1: funny is that this speculative nature of bitcoin is entirely
Speaker 1: how we heard about it and how it is gains adoption,
Speaker 1: price goes higher. You hear about it, you talk about it,
Speaker 1: you buy it, you tell your friends about it, and
Speaker 1: the loop continues. It's a viral loop. It's essentially a
Speaker 1: viral loop baked into bitcoin. And um, you know, when
Speaker 1: we look at this from how does like a money
Speaker 1: go from zero? From a white paper and a group
Speaker 1: of nerdy dudes who want to talk about cryptotomy. Hey,
Speaker 1: sorry to interrupt this video just one more time. I'm
Speaker 1: not running Google ads, so it's actually way less interruption
Speaker 1: than I normally would have on a video. UM, and
Speaker 1: that's because it's sponsored by block five. UM. They are
Speaker 1: opening up the world of bitcoin and financial products offering
Speaker 1: to pay you interest on your bitcoin. Um better than
Speaker 1: own in a rental property that you have to manage
Speaker 1: and control and have the risks. You can just earn
Speaker 1: interest on it, or you can leverage against it. Now,
Speaker 1: I plan to hold my bitcoin forever and literally never
Speaker 1: sell my bitcoin. So how do you do that? Well,
Speaker 1: if I need money, I don't want to sell that bitcoin.
Speaker 1: I'm gonna pay tax on it, all right, I'm gonna
Speaker 1: end up with less and I don't have the bitcoin anymore.
Speaker 1: So a better way to do it is to borrow
Speaker 1: against the bitcoin. So I've put all my money into bitcoin.
Speaker 1: If I want to buy a car, or I want
Speaker 1: to buy a house, I can borrow against it at
Speaker 1: very very low competitive rates. Get my house, get my car,
Speaker 1: whatever that may be, and get to keep the bitcoin.
Speaker 1: I've done a whole video on this. You can find it.
Speaker 1: I'll link it down to the description below. How to
Speaker 1: retire off a bitcoin without paying taxes, and you can
Speaker 1: do that with block five services. I'll link to the
Speaker 1: video game, but though I'm also going to put a
Speaker 1: link to block fire. If you choose to click on
Speaker 1: that link to check them out, you can earn up
Speaker 1: to two in free bitcoin just for using that link.
Speaker 1: And that's it. Let's go ahead and get back to
Speaker 1: the interview biography. How does it go from that to
Speaker 1: the mainstream? And bitcoin has done this through these speculative cycles.
Speaker 1: I don't use the word speculative and a negative connotation.
Speaker 1: It's simply people discovering discovering bitcoin to discovering why it's valuable.
Speaker 1: Some stick around it because they realized the value. Some
Speaker 1: just came in to speculate. Um. But yeah, with this,
Speaker 1: you know, Bitcoin I think is increasingly being recognized as
Speaker 1: a goal two point oh. And this was a checkmark
Speaker 1: for the supercycle theory. In no one recognized bitcoin is
Speaker 1: gold two point other than us, other than us, other
Speaker 1: than our our group of believers. All the institutions though
Speaker 1: you've got, You've got investment banks, hedge funds, and hedge
Speaker 1: fund managers who are legends. Tesla micro Strategy either putting
Speaker 1: bitcoin on their balance sheet. These are gigantic check marks
Speaker 1: for like a supercycle theory. Now again, I'm not saying
Speaker 1: it's likely to happen. I'm saying it could happen. You know,
Speaker 1: big bitcoin moves in mysterious ways. Who knows how what
Speaker 1: the future holds. I can't predict the future. I'm just
Speaker 1: describing a potential outcome that no one was describing at
Speaker 1: the time, because I think this time might be different.
Speaker 1: But yeah, I mean we're seeing every institution across the
Speaker 1: world say bitcoin is gold two point Oh, I've waited
Speaker 1: eight years to see this moment. This is not like
Speaker 1: the other cycles, the other cycles where we were considered
Speaker 1: bitcoin is considered a very risky investment that only retail
Speaker 1: traders get into. No, you've got like giant investment banks
Speaker 1: going oh yeah, Bitcoin's like gold. Yeah, this is huge.
Speaker 1: This is a huge moment, a huge moment for a bitcoin. Yeah.
Speaker 1: I think, um, you know, obviously we don't we don't
Speaker 1: know the future. But looking at cycles and understand how
Speaker 1: technology rolls out, and I'll understand all these different things
Speaker 1: that gives you different perspectives and so um, I always
Speaker 1: like take like the macro view because, UM, I think
Speaker 1: it's easier to kind of see the future, the long
Speaker 1: term future than the short term future. And when you
Speaker 1: see these actions being taken, as you said, by these institutions,
Speaker 1: you know where that leads to eventually. But before we
Speaker 1: get into that, I want to I do want to
Speaker 1: talk about, um, how the makeup of the people in
Speaker 1: the space has changed and what that means for the future,
Speaker 1: because I think that really builds into that super psychle
Speaker 1: But before we do that, UM, having you know, someone
Speaker 1: like you that's been in Silicon Valley for this long, UM,
Speaker 1: it's it's interesting and I'm curious your perspective on this
Speaker 1: because you mentioned Jerome Power calling it like a store value.
Speaker 1: I think China came out like last week and said
Speaker 1: it's like a store of value. I mean, we're seeing
Speaker 1: that from these even City Bank and JP have been
Speaker 1: coming out and kind of saying these things. But yet
Speaker 1: we still have all these other people like, uh, you know,
Speaker 1: whether it's Mark Cuban or we have you know, seemingly
Speaker 1: very smart technology driven people. Um tally recently came out
Speaker 1: the same thing is that it's it's not a currency,
Speaker 1: it's not a store value. It's too speculative, and it
Speaker 1: seems that like they've completely forgotten that technology has to evolve,
Speaker 1: Like just because it's not something today doesn't mean it's
Speaker 1: not going to be something in the future. So, as
Speaker 1: a Silicon Valley kind of tech guy, what's your thought
Speaker 1: on that? Yeah, there's a couple of things here. One
Speaker 1: to address the val Tildy question, where a lot of
Speaker 1: people are just kind of put off by that, Like,
Speaker 1: how did you think how did you think any major,
Speaker 1: gigantic valuable company ever got that big right? It wasn't
Speaker 1: a nice, perfect linear function from zero dollar market share
Speaker 1: to like a one dollar markets or two dollar markets,
Speaker 1: you know, it was like these ebbs and flows of
Speaker 1: investor interest and execution. Bitcoin in a similar function, does that,
Speaker 1: you know a silicon value though it's been a little
Speaker 1: bit disappointing. Silicon Valley tech people inherently don't get bitcoin
Speaker 1: their first inclination. And I wrote about this too because
Speaker 1: it was a very rare thing and a bunch of
Speaker 1: folks agreed with me too, which at first I wrote
Speaker 1: this and I didn't. I was like, man, I'm I
Speaker 1: gonna put myself out here and are people are gonna
Speaker 1: be like cool? Dan, that's a nice opinion. A bunch
Speaker 1: of people in tech who are in a bitcoin came
Speaker 1: out and they were like, this is exactly how the
Speaker 1: system works. Silicon Valley has two primary uh function to
Speaker 1: primary players vcs, so venture capital or people who fund
Speaker 1: startups and startups. Vcs are constantly looking at what's next,
Speaker 1: whatever is hot they want to pile in on. They
Speaker 1: don't care, and most of them aren't subject matter experts.
Speaker 1: They can't be experts on every single sector. So they
Speaker 1: either outsourced that bringing people, or they just choose a theme.
Speaker 1: They're thematic. It's a thematic investment into a R v R, drones, bitcoin,
Speaker 1: chat bots, you name it. And what happens is you
Speaker 1: go deploy capital and the vcs, no one out of
Speaker 1: a hundred make it. So they just look for whatever
Speaker 1: is hot, super hot, and and they put in capital there.
Speaker 1: It was one of the most disappointing things to find
Speaker 1: out ever about Silicon Valley. Venture capitalists are not risk tickers.
Speaker 1: Risk tickers at all. They claim to be, but they're not. Yeah,
Speaker 1: so what happens is they will never go against the
Speaker 1: grain versus all the other vcs. There's top it's like
Speaker 1: a top four VC couple of VC firms, they choose
Speaker 1: what's hot. And if they don't choose what's hot, what
Speaker 1: happens is that the LPs, so the investors in your fund,
Speaker 1: they go, well, why aren't you talking about this other
Speaker 1: subject that they're talking about. Why are you investing in
Speaker 1: something else? That's not the common narrative, And it's very
Speaker 1: counterintuitive because you would expect vcs to be into contrary
Speaker 1: and investments. That's the whole point, right. What happens is
Speaker 1: that they're beholding to the LP still and the LPs
Speaker 1: will give them a lot of uh, you know, they'll
Speaker 1: they give them a lot of ship if they don't
Speaker 1: get into these like more thematic plays that are endorsed
Speaker 1: by the hot hot vcs. There's also a joke, you know,
Speaker 1: if you get into there's the hot vcs, and if
Speaker 1: you can get in with them, it's kind of like
Speaker 1: the same no one ever got fired for buying an IBM. Well,
Speaker 1: no one ever got fired for investing alongside a six, right,
Speaker 1: so the same. So that was kind of a big element.
Speaker 1: And I'll weave this all together at a big point
Speaker 1: here pretty quick. So that's a big element that they're
Speaker 1: not contrarian, and that they're largely chase narratives, and the
Speaker 1: narratives evan flow very quickly. Like does anyone anyone talk
Speaker 1: to talk about chatbots? Yeah? Remember that whole trend for
Speaker 1: a while, super hot or a r v R. I'm
Speaker 1: not wearing an air headset and I'm a gamer, like
Speaker 1: and I've got a high. Do you think it's also though,
Speaker 1: because like, um, why the medical industry won't embrace CBD,
Speaker 1: you know, or you know, cannabis right because they it's natural.
Speaker 1: They can't own it. There's no money to be made there,
Speaker 1: so they want to they want to create their own
Speaker 1: version of uh, you know, a synthetic version of it.
Speaker 1: They can patent, is it something maybe like that where
Speaker 1: you know vcs they can't make any money off bitcoin,
Speaker 1: so they want to create the next all cooin kind
Speaker 1: of thing. Yeah, that's certainly an element. I think part
Speaker 1: of this as well is like um, VCS prescribed the
Speaker 1: narrative to bitcoin that like, oh, bitcoin is good to
Speaker 1: disrupt PayPal. Vcs don't even grock the idea of like
Speaker 1: disrupting governments, and that is that is next level, like
Speaker 1: next level revolutionary, and how do you make money? Off that.
Speaker 1: You know, they can't really go pitch their LPs. Hey,
Speaker 1: I bought bitcoin. It is hoddled. You need to be
Speaker 1: an active investor, actively investing in companies. And what's interesting
Speaker 1: is that hoddling Bitcoin will likely outperform any company that
Speaker 1: you invest in the crypto space. So it certainly has.
Speaker 1: It certainly has even coin based I think it's maybe
Speaker 1: on par like the best performing startup in crypto. I
Speaker 1: think like if you look at Series A check or
Speaker 1: seed check to I p O, bitcoin is still outperforms,
Speaker 1: which is wild, which is nuts, and your risk is
Speaker 1: far lower with bitcoin. So yeah, one they can't make
Speaker 1: they can't make money off of it. To the themes
Speaker 1: have ebbed and flowed and they don't really rock Bitcoin's corps,
Speaker 1: Like how do you make money on Like I want
Speaker 1: to disrupt the government, Like they can't go pitch their
Speaker 1: LPs like you. By the way, bitcoin is gonna disrupt
Speaker 1: central banking and make all the banks ops lead. Also
Speaker 1: it's gonna remove power of government to do all these things.
Speaker 1: These the LPs, I think they're nuts. So they latched
Speaker 1: on the narratives like cheap PayPal replacing visa replacing master card,
Speaker 1: which were totally incongruent with why bitcoin is valuable. And
Speaker 1: then you also have like dats decentralized dat platforms, but
Speaker 1: you could own the token, so you do. The vcs
Speaker 1: could eventually take their little cut, right, so the ebbs
Speaker 1: and flows of the space, the vcs latch onto whatever
Speaker 1: narratives are hot, um and so bitcoin's narrative. Bitcoin is
Speaker 1: old and boring and that's why I don't like it.
Speaker 1: And then you've got the operators. So when you're an operator,
Speaker 1: you constantly have to ship and build. So cracking is
Speaker 1: constantly building new apps, new sorry, new functionality to go
Speaker 1: execute and compete against coin base. If we don't execute,
Speaker 1: then coin based well, and we're gonna be left in
Speaker 1: the dust. So you have to constantly iterate. That's tech,
Speaker 1: that's tech mindset. With money, you don't want to tinker
Speaker 1: with it all the time. Bitcoin needs to stay ossified.
Speaker 1: It needs to be slow moving and eventually become ossified
Speaker 1: because that ensures that trust can be built around this
Speaker 1: open this open network, this open framework versus a weather app.
Speaker 1: You need to keep pushing a new update to it
Speaker 1: to make sure that people find it relevant and useful. Um.
Speaker 1: So for money, it's the opposite. You don't want to
Speaker 1: touch it a lot. And that's where they don't like bitcoin,
Speaker 1: but they like ethereum because ethereum is constantly tinkered with,
Speaker 1: and tech builders are tinkerers. They want to tinker with everything.
Speaker 1: They want to tinker with the monetary policy, they want
Speaker 1: to tinker with like block time, they want to tinker
Speaker 1: with proof of workers at prove mistake. Constantly tinkering and
Speaker 1: tinkering and tinkering, and the idea that a product could
Speaker 1: be perfect or a a protocol could be perfect is unfathomable.
Speaker 1: They're like, no way, they're they're they're like, that's that's impossible.
Speaker 1: There's no way that the first try you got it right.
Speaker 1: They don't. You don't You don't see them going and
Speaker 1: tinkering with the t c P i P, you know,
Speaker 1: Internet protocol Um. They're tinkering with all the things that
Speaker 1: are built on top of that. So maybe that's also
Speaker 1: an evolution thing. So over time they're gonna, Okay, well
Speaker 1: accept this protocol and we'll just tinker with what's on
Speaker 1: top of it. Totally exactly. That big one is like
Speaker 1: a t c P i P. You don't tinker with that. However,
Speaker 1: most younger developers weren't even around back when TCP, t
Speaker 1: c P I P was was talked about in debated
Speaker 1: versus other protocols. So I mean, actually, I think if
Speaker 1: you're around then you're probably pretty old. Like if you
Speaker 1: were in your thirties and forties when they were discussing
Speaker 1: that might be so old that you're not on social right.
Speaker 1: So like there's a whole generation of kind of lost
Speaker 1: context there. But there's been some really cool folks on
Speaker 1: in the big points space. We've pulled out old debates
Speaker 1: and old I think there was one that was kind
Speaker 1: of like a joke, like a joke comic book about
Speaker 1: how many protocols they were thinking of doing. They were
Speaker 1: thinking of doing protocols for every type of application back then,
Speaker 1: and instead they just came up with t c P
Speaker 1: I p UM. There's more nuance of this and a
Speaker 1: lot more to dig get on in a lot of
Speaker 1: context I'm leaving out. But yeah, essentially you've got a
Speaker 1: bunch of like more like front end front end devs
Speaker 1: who are building they're building io s apps and web apps,
Speaker 1: and they're like, oh, I want to tinker with stuff,
Speaker 1: you know, They don't think about the implications of like
Speaker 1: the protocol level, which is like, this is a huge responsibility.
Speaker 1: This isn't your fucking weather. App Like, if you mess
Speaker 1: up something, you've got the entire world's financial system building
Speaker 1: being built on this. This isn't it's not going to
Speaker 1: break and you can just fix it, you know, like
Speaker 1: if you break it, you might lose trust for forever.
Speaker 1: And almost no engineers in the world, a very few
Speaker 1: operating that premise maybe like aircraft aircraft, software engineers or
Speaker 1: you know, they have to think about crazy up time
Speaker 1: to ensure that everything, like a plane doesn't crash with
Speaker 1: people on it. Type of engineers the right wants to
Speaker 1: think about protocol design. Yeah. Yeah, that's that's some good context.
Speaker 1: Thanks for sharing that. Let's say, let's pivot into back
Speaker 1: to this this supercycle. So um I think you know,
Speaker 1: and if you were around in seventeen, it was like,
Speaker 1: obviously it's like retail fomo. All the individuals are coming
Speaker 1: in and that that's interesting in itself how it was
Speaker 1: the kind of the first time that retail had come
Speaker 1: to technology before the institutions and funds um But at
Speaker 1: the same time we were talking all the institutions are
Speaker 1: gonna come. They're gonna come. But now we've seen a
Speaker 1: completely different type of buyer, and I think that really
Speaker 1: feeds into what you're calling this supercycle. Absolutely. Yeah. The
Speaker 1: market before was retail retails, individual like Mark and I
Speaker 1: who were not we're not professional. I don't know if
Speaker 1: market is or not, but you know we we don't
Speaker 1: want run hedge funds, um and and so the institutions
Speaker 1: had largely stayed out of bitcoin, and in seen where like,
Speaker 1: the institutions are coming, the herd is coming. It was
Speaker 1: a little too early. Now the herd is here. The
Speaker 1: herd is storming through the house. We can hear the herd,
Speaker 1: we can smell the herd. The herd is here, and um,
Speaker 1: this represents a huge moment for bitcoin, not just because
Speaker 1: the institutions, and I'll get to the second part in
Speaker 1: your second it's the institutions bring about large amounts of
Speaker 1: capital which gets deployed in a bitcoin. They bring around
Speaker 1: large amounts of stability in terms of infrastructure, but the
Speaker 1: legitimacy factor I think a lot of bitcoiners are underestimating. Look, guys,
Speaker 1: I'm a libertarian. I'm a libertarian freedom fighter to like
Speaker 1: corporations buying bitcoin is not a bad thing. They can't
Speaker 1: do anything if they buy bitcoin. They can't change the protocol,
Speaker 1: they can't change the governance. We still control bitcoin. But
Speaker 1: they're opting into our free world. This is a great moment.
Speaker 1: These institutions are opting into a world that we designed
Speaker 1: of permission less nature. Um, they're not going to change bitcoin,
Speaker 1: it's not possible given how bitcoins architected and we are
Speaker 1: the resilient core, and that won't happen. But what the
Speaker 1: bitcoiners don't realize is that by institutions buying bitcoin, now
Speaker 1: more retail will buy bitcoin. Because retail it looks to
Speaker 1: institutions for legitimacy. You know, they're not libertarian like us.
Speaker 1: They don't question the nature of the reality. So when
Speaker 1: these trusted institutions like banks by bitcoin, then they buy.
Speaker 1: So now we're hitting that moment and that stride in
Speaker 1: the market. These institutions are buying bitcoin, and retail goes
Speaker 1: wait a second. These institutions are the smart people that
Speaker 1: I trust. They started to buy bitcoin, and so that's
Speaker 1: why this could all feed into a supercycle where we've
Speaker 1: never had that before. We've had a very small retail segment,
Speaker 1: a retail segment that was very risk on. They were
Speaker 1: willing to reject institutional buy in, reject government buy in.
Speaker 1: And now we're starting to get that, which I think
Speaker 1: increases the legitimacy of bitcoin in the eyes of the
Speaker 1: retail trader. Yeah, so the retail trader, I mean, they
Speaker 1: came in chasing pumps. So you know, at the end
Speaker 1: of seventeen, their their friends said, oh, I just turned
Speaker 1: five thousand and twenty, so they jumped in. But as
Speaker 1: soon as it started going down, they didn't understand why
Speaker 1: they bought. They just thought they were going to make
Speaker 1: it rich overnight. As soon as you started going down,
Speaker 1: they sold. So that not only did it push it
Speaker 1: up faster, but it also brought it back down faster.
Speaker 1: That's why the volatility is always the most at the top.
Speaker 1: But then, as you're kind of explaining, now, with these
Speaker 1: institutional investors, you have like not Warm Buffet, but like
Speaker 1: Warm Buffet's own Coca Cola since like the sixties, like
Speaker 1: they buy things like Forever and so um. You just
Speaker 1: have a different makeup of the person there um, And
Speaker 1: so they're not quickly that they understand why they're buying.
Speaker 1: They're not buying to make twenty grand and if it
Speaker 1: automn if it starts dropping, they don't automatically sell out.
Speaker 1: So I guess that kind of changes that volatility kind
Speaker 1: of curve for that sharp ratio totally. Yeah, definitely changes
Speaker 1: the volatility structure. I think bitcoin is still gonna be volatile,
Speaker 1: quite volatile compared to other currencies and other assets for
Speaker 1: some time, but it certainly changes the the the holdler mix,
Speaker 1: the mix of individuals buying bitcoin, and I do think
Speaker 1: most institutions will skew towards a longer hoddle period than
Speaker 1: a retail trader. Retail traders typically fomo in because their
Speaker 1: buddy told them about it, and then they're not very convicted,
Speaker 1: you know, the nor are they managing people's money to
Speaker 1: where it like a hedge fund manager or fund can
Speaker 1: hold onto it for a longer duration and they have
Speaker 1: an investment thesis um And they were like, sure, we'll
Speaker 1: wait five years, and the vcs holder their investment for
Speaker 1: five to ten years UM. Now, headpunds are the same
Speaker 1: thing as vcs, but in a similar vein there can
Speaker 1: they have a can they have a conviction in this
Speaker 1: trade and they're gonna go with this investment thesis and
Speaker 1: they're gonna go do it. I was a retail trader
Speaker 1: wakes up and they had two cups of coffee and
Speaker 1: they bought bitcoin, and three days later they're drunk with
Speaker 1: every buddies at the bar and they panic sell. You know,
Speaker 1: so they're quite a different dynamic. The other thing I
Speaker 1: would say is that you know, kind of like what
Speaker 1: you were saying about the vcs, where nobody wants to
Speaker 1: be the first guy, and then they all want to
Speaker 1: jump onto the trend. I think that we also see
Speaker 1: the same thing with the funds and institutions as well,
Speaker 1: where nobody wants to be the first guy. But once
Speaker 1: the first guy buys a little bitcoin and they outperform,
Speaker 1: then everybody else has to jump in, and then that
Speaker 1: kind of becomes this self fulfilling prophecy. More people jump in,
Speaker 1: they outperform. More people jump in, they outperform um. And
Speaker 1: we see that now I know, we've got to kind
Speaker 1: of start wrapping this up, so maybe we can just
Speaker 1: kind of move along, um where this cycle takes us
Speaker 1: and kind of what you're thinking now, Michael Sailor said
Speaker 1: that like all models are broken at this point, which
Speaker 1: you know might be true. You're kind of saying the
Speaker 1: same thing right this time is different or whatever. Um
Speaker 1: we've heard. You know, Cathy would from ARC said that
Speaker 1: she she thinks that SMP five companies should put ten
Speaker 1: percent of their treasury in it, and if they did that,
Speaker 1: it puts it to five hundred thousand dollars a coin.
Speaker 1: Seems pretty logical, Michael Saylor. You know she's just going
Speaker 1: to three hundred chillion, and and there's there's reason behind that.
Speaker 1: But in this cycle, kind of what are you what
Speaker 1: are you thinking or seeing? Yeah, so, I mean if
Speaker 1: we talked, if we look at historical cycles and project
Speaker 1: the future, we would see between a hundred and three
Speaker 1: three hundred thousand dollars a bitcoin. This is also what
Speaker 1: a lot of analysts are predicting based on on chain data, etcetera. Typically,
Speaker 1: if everyone's guessing the same thing, it's probably not going
Speaker 1: to be that. It's probably not what's going to happen. Um.
Speaker 1: So that's that's kind of how what's to define is
Speaker 1: like the classic outcome here, the supercycle outcome would be
Speaker 1: anything above like three d thousand up to like a million. Think, well,
Speaker 1: there's no limit to it, but I think anything past
Speaker 1: a million would be insane. Even people think about crazy
Speaker 1: to even say a million or half a million, But
Speaker 1: I think anything around there the half a million to
Speaker 1: a million dollar range would be in like super cycle territory.
Speaker 1: Um I'd say, like entering that is a cycle that
Speaker 1: was predicted to be much smaller but was bigger than expected.
Speaker 1: Or it could be a normal cycle and there's no
Speaker 1: bear market or a limited bear market, so it goes
Speaker 1: to two hundred dollars bitcoin and only drops to two
Speaker 1: and stays flat to the next bowl run something like that.
Speaker 1: You know, something that's very atypical, so basically doesn't break
Speaker 1: the pattern, does it break the mold. I think we've
Speaker 1: got all the elements that show that this time is different.
Speaker 1: We'll see what happens. I'm happy either way. Bitcoin doesn't change.
Speaker 1: Either way, bitcoin doesn't fail or succeed. Bitcoin would even
Speaker 1: succeed in these lower bound scenarios of a hundred thousand
Speaker 1: and three thousand supercycle is just what I think could
Speaker 1: happen if the whole world wakes up to bitcoin at
Speaker 1: the same time, and certainly the price isn't going to
Speaker 1: be the same, it should be much higher. Than what
Speaker 1: we expect or have a less intense bear market. Yeah,
Speaker 1: and and as you said, all the catalyst is there.
Speaker 1: We have you know, the pandemic and an unlimited money printing. Um,
Speaker 1: we have this younger generation. If you look at some
Speaker 1: cycles like the fourth turning, we have rapid change is
Speaker 1: going to be happening in this decade. Um. You know,
Speaker 1: all these things are kind of lining up so it
Speaker 1: could happen. So UM, I know we got to wrap
Speaker 1: it up, but you left us with a lot of thoughts,
Speaker 1: so hopefully everybody enjoys that. Anything you want to say
Speaker 1: closing it out, well, Mark, thanks for having me on.
Speaker 1: Really appreciate it. Um. If you want to follow me,
Speaker 1: check out my Twitter account at Dan held That's where
Speaker 1: I post all my thoughts. Um. Yeah, but thanks for
Speaker 1: having me Mark. Yeah, we'll go ahead and linked to
Speaker 1: your Twitter and your news letter down below for everybody
Speaker 1: and without we'll wrap it up. Thanks so much, Dan
Speaker 1: sures