1 00:00:00,120 --> 00:00:02,320 Speaker 1: The real economy is broken because of the printing of 2 00:00:02,360 --> 00:00:06,080 Speaker 1: money that it distorts the actual operation of money, the 3 00:00:06,160 --> 00:00:09,440 Speaker 1: function of money, the price signals of money. Your money 4 00:00:09,480 --> 00:00:11,680 Speaker 1: is losing its value. The printing of money is the problem. 5 00:00:11,760 --> 00:00:14,120 Speaker 1: Bitcoin is money that can't be printed. It's the solution 6 00:00:14,200 --> 00:00:17,160 Speaker 1: for that problem, and it's expressly built to solve them. 7 00:00:17,200 --> 00:00:20,319 Speaker 1: It's fixed supply is the source of all fundamental value 8 00:00:20,360 --> 00:00:22,680 Speaker 1: in bitcoin. It will only ever be twenty one million detcoin. 9 00:00:22,840 --> 00:00:24,880 Speaker 1: It's volatle for the reason that has a fixed apply 10 00:00:24,920 --> 00:00:27,440 Speaker 1: and that everyone's adopting bitcoin for the first time. It's 11 00:00:27,600 --> 00:00:29,880 Speaker 1: naturally volatile, it's necessarily. 12 00:00:29,280 --> 00:00:32,600 Speaker 2: Valt So the volatility is there, the price of bitcoin 13 00:00:32,720 --> 00:00:34,840 Speaker 2: going up and down. I think that's a good thing. 14 00:00:35,000 --> 00:00:37,720 Speaker 2: But in regards to like being in media a stable 15 00:00:37,760 --> 00:00:40,640 Speaker 2: medium exchange today, maybe it's not. So how do we 16 00:00:40,640 --> 00:00:43,600 Speaker 2: think about the volatility, as you said, in regards to 17 00:00:43,680 --> 00:00:45,839 Speaker 2: payments today versus like an evolution of. 18 00:00:45,840 --> 00:00:48,560 Speaker 1: That great question? 19 00:00:48,680 --> 00:00:54,520 Speaker 2: So, so, Parker, you said that bitcoin is the most 20 00:00:54,520 --> 00:00:58,480 Speaker 2: important innovation in the world. Why should someone listening to 21 00:00:58,480 --> 00:01:01,400 Speaker 2: start this out maybe scaled on the fence. Why should 22 00:01:01,400 --> 00:01:04,440 Speaker 2: they right now be dropping everything and paying attention to bitcoin? 23 00:01:04,800 --> 00:01:08,760 Speaker 1: I think oftentimes people look at bitcoin as a solution 24 00:01:09,400 --> 00:01:14,720 Speaker 1: in search of a problem, and that the reality of 25 00:01:14,760 --> 00:01:18,720 Speaker 1: the situation is that people do not understand the problem 26 00:01:18,760 --> 00:01:21,640 Speaker 1: that they have. They might know that they have problems, 27 00:01:21,880 --> 00:01:24,200 Speaker 1: but they might not know the root cause of it 28 00:01:24,360 --> 00:01:26,720 Speaker 1: or the source of it, and that, in my view, 29 00:01:27,040 --> 00:01:30,640 Speaker 1: the most pressing problem that everyone is suffering is that 30 00:01:31,400 --> 00:01:35,600 Speaker 1: their money is constantly being debased, and that bitcoin is 31 00:01:35,600 --> 00:01:40,600 Speaker 1: the solution to that problem, and that they're seeking out 32 00:01:40,400 --> 00:01:43,920 Speaker 1: somewhere on the range of imperfect solutions to bad solutions 33 00:01:44,319 --> 00:01:48,080 Speaker 1: for the problem because they misunderstand it, and that bitcoin 34 00:01:48,240 --> 00:01:51,680 Speaker 1: solves the most important problem for the greatest number of 35 00:01:51,720 --> 00:01:55,840 Speaker 1: people on Earth, and it's still very early and not 36 00:01:55,960 --> 00:02:00,320 Speaker 1: well understood, and that once they figure out bitcoin coin 37 00:02:00,600 --> 00:02:04,320 Speaker 1: and they can also most efficiently go down that rabbit 38 00:02:04,360 --> 00:02:08,360 Speaker 1: hole because it might be complicated, it might be unintuitive 39 00:02:08,400 --> 00:02:11,440 Speaker 1: at first, but it's a finite surface area, and all 40 00:02:11,560 --> 00:02:14,280 Speaker 1: the other derivative problems that they might perceive in their 41 00:02:14,320 --> 00:02:18,760 Speaker 1: life stem from in most circumstances, maybe not all circumstances, 42 00:02:18,880 --> 00:02:21,560 Speaker 1: but in most circumstances at least from a financial perspective, 43 00:02:21,560 --> 00:02:24,799 Speaker 1: because their money is constantly losing value, and so all 44 00:02:24,880 --> 00:02:29,239 Speaker 1: the time and energy they're putting in to accumulate money 45 00:02:29,320 --> 00:02:31,400 Speaker 1: or to acquire money to pay for various things in 46 00:02:31,440 --> 00:02:34,840 Speaker 1: their life is being destroyed. And biitwin fixes that. 47 00:02:35,120 --> 00:02:37,640 Speaker 2: The biggest problem in the world. It fixes And so 48 00:02:37,680 --> 00:02:39,280 Speaker 2: when you solve a big problem for a lot of people, 49 00:02:39,280 --> 00:02:41,600 Speaker 2: there's a lot of value created. Let's just push on 50 00:02:41,680 --> 00:02:43,840 Speaker 2: that for a second, because what you're saying is it 51 00:02:43,880 --> 00:02:45,519 Speaker 2: solves the biggest problem for the most people, which is 52 00:02:45,520 --> 00:02:47,239 Speaker 2: their money is losing values. They have to work harder 53 00:02:47,280 --> 00:02:49,519 Speaker 2: and harder to maintain their life. But do you think 54 00:02:49,560 --> 00:02:53,560 Speaker 2: most people, when we talk broadly the masses, understand that, Like, 55 00:02:53,720 --> 00:02:55,320 Speaker 2: do they see that as a problem. 56 00:02:56,200 --> 00:02:59,840 Speaker 1: They see it as a problem, but they don't understand 57 00:03:00,160 --> 00:03:04,840 Speaker 1: extent of it. I'd say most people are engineered to 58 00:03:04,960 --> 00:03:10,400 Speaker 1: know that their money loses value, so they try to 59 00:03:10,480 --> 00:03:15,639 Speaker 1: address it on the margin. They invest in the equity 60 00:03:15,720 --> 00:03:20,080 Speaker 1: markets to offset inflation, or they invest in real estate 61 00:03:20,160 --> 00:03:24,880 Speaker 1: passively to offset the problem. And one of the things 62 00:03:24,960 --> 00:03:26,560 Speaker 1: I like say is like, Hey, if there's a business 63 00:03:26,560 --> 00:03:29,680 Speaker 1: that needs to be funded that is going to deliver 64 00:03:30,240 --> 00:03:32,480 Speaker 1: a lot of value in the world, those businesses still 65 00:03:32,520 --> 00:03:35,000 Speaker 1: need to be funded. If you dig up dirt and 66 00:03:35,040 --> 00:03:37,440 Speaker 1: build a piece of real estate that delivers value like 67 00:03:37,520 --> 00:03:41,600 Speaker 1: that is a necessary piece of equation because ultimately money 68 00:03:42,200 --> 00:03:45,600 Speaker 1: is helping to facilitate exchange and to deliver real goods 69 00:03:45,640 --> 00:03:48,200 Speaker 1: and services to the world, which is really what improves 70 00:03:48,200 --> 00:03:51,920 Speaker 1: people's lives. But in the circumstance where people know that 71 00:03:51,920 --> 00:03:56,000 Speaker 1: their money loses value but not knowing why or that 72 00:03:56,080 --> 00:03:58,200 Speaker 1: it ends a lot worse than they think that it's 73 00:03:58,240 --> 00:04:00,760 Speaker 1: not just their money losing too per a year, three 74 00:04:00,800 --> 00:04:04,800 Speaker 1: percent or five percent that ultimately stops working. And there's 75 00:04:05,040 --> 00:04:08,880 Speaker 1: there's plenty of historical evidence, and there's also a fundamental 76 00:04:08,920 --> 00:04:12,200 Speaker 1: underpinning it that humans can't work and convert their time 77 00:04:12,240 --> 00:04:15,480 Speaker 1: and energy into something that can be easily produced money 78 00:04:15,480 --> 00:04:17,800 Speaker 1: being created at thin air. That it's that they know 79 00:04:17,880 --> 00:04:20,920 Speaker 1: there's a problem, they just don't know the root of it, 80 00:04:21,120 --> 00:04:26,040 Speaker 1: or the extent of it, or how negatively asymmetric. The 81 00:04:27,240 --> 00:04:31,280 Speaker 1: end consequence of money being debased really is, I. 82 00:04:31,200 --> 00:04:34,600 Speaker 2: Would just go step further. I think most people see 83 00:04:34,760 --> 00:04:39,080 Speaker 2: prices going up and things keep getting more expensive, and 84 00:04:39,120 --> 00:04:41,040 Speaker 2: so if I don't invest, how will I buy them 85 00:04:41,080 --> 00:04:43,800 Speaker 2: in the future, Which is the same thing as you're saying, 86 00:04:43,880 --> 00:04:47,200 Speaker 2: But it's the opposite side. Right, the money is being debased, 87 00:04:47,200 --> 00:04:49,279 Speaker 2: it's losing value, which is why prices are going up. 88 00:04:49,320 --> 00:04:51,440 Speaker 2: But they don't see the money being debased and going down. 89 00:04:51,520 --> 00:04:52,840 Speaker 2: They just see the prices going up. 90 00:04:53,240 --> 00:04:55,760 Speaker 1: Yeah, safety and amuse. The author of the Bitcoin Center 91 00:04:55,839 --> 00:05:00,760 Speaker 1: has a great quote that I consistently see circul We're saying, 92 00:05:00,839 --> 00:05:03,800 Speaker 1: the groceries aren't getting more expensive. Your your money's losing 93 00:05:03,839 --> 00:05:05,560 Speaker 1: its value, right, and it's the other side of the 94 00:05:05,560 --> 00:05:09,160 Speaker 1: same coin. But it's really important framing to shift your 95 00:05:09,200 --> 00:05:12,479 Speaker 1: perspective in your understanding of the root problem. 96 00:05:12,600 --> 00:05:15,640 Speaker 2: Right. And we saw in the last election that we 97 00:05:15,720 --> 00:05:19,480 Speaker 2: just had where Trump won and inflation was probably one 98 00:05:19,520 --> 00:05:22,479 Speaker 2: of the one of the hottest subjects going But people 99 00:05:22,480 --> 00:05:24,960 Speaker 2: aren't really understanding that the root cause of this inflation 100 00:05:25,080 --> 00:05:27,960 Speaker 2: or as they see CPI going up and so yeah, 101 00:05:28,080 --> 00:05:31,240 Speaker 2: so not understanding the problem at hand. That's the number 102 00:05:31,240 --> 00:05:33,240 Speaker 2: one obstacle to bitcoin. They think of it as a 103 00:05:33,240 --> 00:05:36,240 Speaker 2: solution looking for a problem because they don't realize the 104 00:05:36,279 --> 00:05:39,040 Speaker 2: problem is that the reason why your life keep getting 105 00:05:39,080 --> 00:05:41,480 Speaker 2: more expensive is that your money's losing value. 106 00:05:41,640 --> 00:05:44,600 Speaker 1: Or connecting it to bitcoin, that bitcoin's a solution to that. 107 00:05:44,680 --> 00:05:48,839 Speaker 2: Right, Yeah, yeah, yeah, got it. So, you know, you 108 00:05:49,000 --> 00:05:50,960 Speaker 2: used to write a lot. You've still been writing some stuff. 109 00:05:50,960 --> 00:05:52,240 Speaker 2: I want to talk about some of the stuf you're written, 110 00:05:52,279 --> 00:05:55,320 Speaker 2: But the big one is that gradually then suddenly, which 111 00:05:55,360 --> 00:05:58,119 Speaker 2: is amazing, and you sort of took like a first 112 00:05:58,160 --> 00:06:03,320 Speaker 2: principles approach to sort of explaining bitcoin. How would you 113 00:06:03,360 --> 00:06:05,719 Speaker 2: put that into maybe like a three step framework for 114 00:06:05,760 --> 00:06:08,360 Speaker 2: people to like think about and then maybe go dig 115 00:06:08,400 --> 00:06:09,800 Speaker 2: into and research more from there. 116 00:06:10,400 --> 00:06:15,039 Speaker 1: Yeah, So the three things are the problem the bitcoin's 117 00:06:15,200 --> 00:06:17,760 Speaker 1: actually solving. That's that is not a solution in search 118 00:06:17,760 --> 00:06:20,040 Speaker 1: of a problem. That it's an express solution to an 119 00:06:20,040 --> 00:06:22,279 Speaker 1: express problem, and the problem is printing of money. 120 00:06:22,440 --> 00:06:24,360 Speaker 2: So start there, start there. 121 00:06:24,880 --> 00:06:27,279 Speaker 1: You have a problem. You know, one of the things 122 00:06:27,279 --> 00:06:29,840 Speaker 1: that you just mentioned is in the last selection, it's 123 00:06:29,880 --> 00:06:34,240 Speaker 1: in the United States, inflation was a big focus area. 124 00:06:35,240 --> 00:06:38,720 Speaker 1: I never saw one politician who was talking about it 125 00:06:39,400 --> 00:06:43,039 Speaker 1: on the stump. Connecting it to the printing of money. 126 00:06:43,600 --> 00:06:45,440 Speaker 1: The printing of money is the source of that. You 127 00:06:45,480 --> 00:06:48,320 Speaker 1: have a problem. The printing of money is the problem. 128 00:06:49,360 --> 00:06:51,719 Speaker 1: Bitcoin is money that can't be printed. It's the solution 129 00:06:51,839 --> 00:06:55,240 Speaker 1: for that problem, and it's expressly built to solve it. 130 00:06:56,480 --> 00:07:01,000 Speaker 1: So connecting it to the problem is one frame. The 131 00:07:01,040 --> 00:07:06,080 Speaker 1: second framework is understanding bitcoin from a bottom up perspective 132 00:07:06,920 --> 00:07:10,400 Speaker 1: as to why it actually solves the problem and how. 133 00:07:10,960 --> 00:07:14,920 Speaker 1: And the quick high level of that is that it's 134 00:07:14,960 --> 00:07:19,120 Speaker 1: fixed supply is the source of all fundamental value in bitcoin. 135 00:07:19,160 --> 00:07:21,560 Speaker 1: There will only ever be twenty one million bitcoin. What 136 00:07:21,680 --> 00:07:25,360 Speaker 1: it represents is money that can't be printed, and that 137 00:07:26,000 --> 00:07:29,800 Speaker 1: how Bitcoin is able to enforce its fixed supply is 138 00:07:29,800 --> 00:07:34,840 Speaker 1: of significant consequence to the equation that it is not random, 139 00:07:34,880 --> 00:07:38,720 Speaker 1: it's not by happenstance. It might be complicated or complex. 140 00:07:39,240 --> 00:07:41,400 Speaker 1: There's a lot underneath the hood, but you first have 141 00:07:41,480 --> 00:07:44,600 Speaker 1: to understand why it's relevant, why a form of money 142 00:07:44,680 --> 00:07:46,920 Speaker 1: that can't be printed would be relevant to somebody. To 143 00:07:46,960 --> 00:07:49,480 Speaker 1: then be able to go down and connect the dots 144 00:07:49,480 --> 00:07:52,680 Speaker 1: as to how the economic incentives are able to be 145 00:07:53,000 --> 00:07:56,120 Speaker 1: held together. S has to Bitcoin incredibly enforce its fixed 146 00:07:56,120 --> 00:08:00,560 Speaker 1: supply without the need for trust. So that's the second thing, 147 00:08:00,960 --> 00:08:05,680 Speaker 1: And then the third framework is all the common misconceptions 148 00:08:05,720 --> 00:08:10,000 Speaker 1: about bitcoin, which are that it's too volatile to be money, 149 00:08:10,160 --> 00:08:13,760 Speaker 1: or that it can be easily copied, or that it's 150 00:08:13,840 --> 00:08:17,640 Speaker 1: just for criminals, which just for criminals is becoming less 151 00:08:17,640 --> 00:08:21,000 Speaker 1: of a of a knock on bitcoin. As governments around 152 00:08:21,040 --> 00:08:23,480 Speaker 1: the world and corporations around the world are adopting it 153 00:08:23,480 --> 00:08:27,120 Speaker 1: as money, it's becoming more difficult for somebody to posit that. 154 00:08:27,640 --> 00:08:33,520 Speaker 1: But basically understanding things that are difficult to see. If 155 00:08:33,520 --> 00:08:36,240 Speaker 1: you could say, hey, it would make sense that if 156 00:08:36,280 --> 00:08:38,320 Speaker 1: there were a form of money that can't be printed, 157 00:08:38,400 --> 00:08:42,640 Speaker 1: that everyone would adopt it, adopt it. But how does 158 00:08:42,679 --> 00:08:45,640 Speaker 1: that marry with the fact that bitcoin goes up ten 159 00:08:45,679 --> 00:08:48,320 Speaker 1: percent in a day or down. That doesn't That's not 160 00:08:48,440 --> 00:08:50,920 Speaker 1: how I have known or you know, I say I. 161 00:08:51,080 --> 00:08:53,880 Speaker 1: But the person that's evaluating it might look and say, well, 162 00:08:53,920 --> 00:08:57,000 Speaker 1: bitcoin can't be money for that reason. And in reality, 163 00:08:57,480 --> 00:09:00,120 Speaker 1: if you realize that it's volatile for the reason and 164 00:09:00,160 --> 00:09:02,480 Speaker 1: that has a fixed apply, and that everyone's adopting bitcoin 165 00:09:02,520 --> 00:09:05,800 Speaker 1: for the first time, it's naturally volatile. It's necessarily volatile. 166 00:09:05,800 --> 00:09:09,000 Speaker 1: So people have to work through those mental blocks in 167 00:09:09,120 --> 00:09:12,920 Speaker 1: order to come back to the highest level ideas behind 168 00:09:12,960 --> 00:09:16,760 Speaker 1: bitcoin to see how they're consistent with each other and 169 00:09:16,840 --> 00:09:21,760 Speaker 1: not inconsistent. So the problem the fundamentals the bottom up, 170 00:09:21,840 --> 00:09:25,640 Speaker 1: and then the common questions that are logical to ask 171 00:09:25,720 --> 00:09:29,640 Speaker 1: but have coherent, consistent explanations. 172 00:09:30,440 --> 00:09:34,080 Speaker 2: So let's dig into the volatility and why it can't 173 00:09:34,080 --> 00:09:38,240 Speaker 2: be money. So obviously with you work on bitcoin payments, 174 00:09:38,280 --> 00:09:40,440 Speaker 2: that's sort of your life right now with zapp, right, 175 00:09:40,920 --> 00:09:42,040 Speaker 2: So I want to dig into that. I want to 176 00:09:42,040 --> 00:09:44,679 Speaker 2: talk about stable coins and the Genius Act and maybe 177 00:09:44,720 --> 00:09:47,599 Speaker 2: how that compliments or doesn't compliment bitcoin. But let's just 178 00:09:47,640 --> 00:09:50,000 Speaker 2: talk about the payments piece overall, and we'll talk about 179 00:09:50,000 --> 00:09:54,960 Speaker 2: those things. So the volatility is there the price of 180 00:09:54,960 --> 00:09:58,199 Speaker 2: bitcoin going up and down. I think that's a good thing. 181 00:09:58,400 --> 00:10:01,120 Speaker 2: But in regards to like being a media a stable 182 00:10:01,160 --> 00:10:06,160 Speaker 2: medium exchange today, maybe it's not. So there's today and 183 00:10:06,200 --> 00:10:09,199 Speaker 2: there's a future, so like will it ever be versus 184 00:10:09,440 --> 00:10:11,600 Speaker 2: the best today? So how do we think through that? 185 00:10:11,679 --> 00:10:17,160 Speaker 2: Because if I want to, if I'm in a country 186 00:10:17,320 --> 00:10:20,160 Speaker 2: with a failing currency and I could maybe go to 187 00:10:20,200 --> 00:10:22,120 Speaker 2: the dollar, I could go to bitcoin, but I don't 188 00:10:22,160 --> 00:10:23,679 Speaker 2: have that much money. And if I go to buy 189 00:10:23,720 --> 00:10:25,720 Speaker 2: groceries next week but I can't buy as much, that 190 00:10:25,720 --> 00:10:27,560 Speaker 2: could be a problem. So how do we think about 191 00:10:27,840 --> 00:10:31,800 Speaker 2: the volatility, as you said, in regards to payments today 192 00:10:31,880 --> 00:10:33,360 Speaker 2: versus like an evolution of that. 193 00:10:35,080 --> 00:10:40,080 Speaker 1: Great question? So one I think that to start, you 194 00:10:40,160 --> 00:10:42,839 Speaker 1: have to understand why bit coin's volatile. You have to 195 00:10:42,920 --> 00:10:49,160 Speaker 1: understand why it's volatile and why volatility is not a risk. 196 00:10:50,600 --> 00:10:54,000 Speaker 1: And when I say that is that volatility can be 197 00:10:54,080 --> 00:10:56,960 Speaker 1: a risk depending on what your time horizon is right, 198 00:10:57,480 --> 00:11:01,000 Speaker 1: And so you have to be able to explains yourself 199 00:11:01,080 --> 00:11:06,880 Speaker 1: first why bitcoin would store value over time despite being volatile, 200 00:11:06,920 --> 00:11:11,600 Speaker 1: that it's volatility is actually to your benefit that you know. 201 00:11:11,960 --> 00:11:13,600 Speaker 1: One way I would think about it is if only 202 00:11:13,640 --> 00:11:17,800 Speaker 1: one percent of the world has any material exposure to bitcoin, 203 00:11:18,520 --> 00:11:22,640 Speaker 1: and if you marry that with this idea that everyone 204 00:11:22,679 --> 00:11:25,080 Speaker 1: in the world, if they understood that there were a 205 00:11:25,080 --> 00:11:28,040 Speaker 1: form of money that can't be printed in that bitcoin 206 00:11:28,120 --> 00:11:30,080 Speaker 1: is that, and that it's fixed supply of twenty one 207 00:11:30,120 --> 00:11:33,120 Speaker 1: million is credible that ninety nine percent of the world 208 00:11:33,240 --> 00:11:35,640 Speaker 1: is yet to adopt it, but they would adopt it 209 00:11:35,640 --> 00:11:38,199 Speaker 1: for the very same reason that someone would who's already 210 00:11:38,240 --> 00:11:42,360 Speaker 1: adopted it. Understood that it holds value because more of 211 00:11:42,400 --> 00:11:45,640 Speaker 1: it can't be created, but it's also necessarily volatile. If 212 00:11:45,679 --> 00:11:49,240 Speaker 1: one percent of the world has figured this out, well, 213 00:11:49,600 --> 00:11:52,000 Speaker 1: if ten percent were to figure it out, then that 214 00:11:52,080 --> 00:11:54,440 Speaker 1: means that nine out of every ten people in the 215 00:11:54,480 --> 00:11:57,000 Speaker 1: world that are buying bitcoin for the first time are 216 00:11:57,040 --> 00:12:00,440 Speaker 1: pricing bitcoin, are putting a value on it the first 217 00:12:00,480 --> 00:12:03,520 Speaker 1: time in their life. Right, Well, if more can't be created, 218 00:12:03,760 --> 00:12:07,319 Speaker 1: there has to be price discovery, right. That price discovery 219 00:12:07,360 --> 00:12:10,240 Speaker 1: is naturally volatile. But the volatility for people who already 220 00:12:10,240 --> 00:12:13,440 Speaker 1: hold it is a benefit because if ten times the 221 00:12:13,520 --> 00:12:15,600 Speaker 1: number of people are demanding an asset, even if they're 222 00:12:15,640 --> 00:12:19,120 Speaker 1: pricing it for the first time, are having to bid 223 00:12:19,120 --> 00:12:23,360 Speaker 1: the price up to deliver value to people that already 224 00:12:23,360 --> 00:12:25,839 Speaker 1: do hold it. Again, that is in your benefit. So 225 00:12:25,960 --> 00:12:28,000 Speaker 1: first you have to anchor to that fundamental that is 226 00:12:28,080 --> 00:12:31,600 Speaker 1: volatile for the very same reason of why someone would 227 00:12:31,600 --> 00:12:33,160 Speaker 1: demand it in the first place, and that that is 228 00:12:33,200 --> 00:12:35,080 Speaker 1: connected to its ability to store value. 229 00:12:35,920 --> 00:12:38,480 Speaker 2: Let me hind on that. So, because it's a fixed 230 00:12:38,480 --> 00:12:40,840 Speaker 2: supply and we have more people coming in and maybe 231 00:12:40,840 --> 00:12:42,280 Speaker 2: something going down, I mean there's EBB and flow a 232 00:12:42,320 --> 00:12:44,920 Speaker 2: little bit, so we get price moving up and down 233 00:12:44,960 --> 00:12:47,840 Speaker 2: price volatility because of that. Now, if we look at 234 00:12:47,840 --> 00:12:50,440 Speaker 2: the long lens of bitcoin, the price volatility moves to 235 00:12:50,480 --> 00:12:53,200 Speaker 2: the upside, and so as an investor, we want the 236 00:12:53,200 --> 00:12:54,599 Speaker 2: price to go up, right, We don't want to be 237 00:12:54,640 --> 00:12:56,319 Speaker 2: in the stable poin that never moves, and so that 238 00:12:56,400 --> 00:12:58,920 Speaker 2: volatility is our advantage. It's a necessary good. I think 239 00:12:58,960 --> 00:13:02,600 Speaker 2: it's the point that you're making. Yes, right, So it's volatile, 240 00:13:02,640 --> 00:13:06,880 Speaker 2: but volataile tipside, we like that, but depends on the 241 00:13:06,960 --> 00:13:08,400 Speaker 2: duration correct. 242 00:13:08,440 --> 00:13:10,439 Speaker 1: So then the way that I would think about that 243 00:13:10,559 --> 00:13:13,600 Speaker 1: is and it is this difficult problem. If you have 244 00:13:13,679 --> 00:13:21,000 Speaker 1: no savings and you are barely saving more than like 245 00:13:21,120 --> 00:13:23,640 Speaker 1: when I say no savings, you have no Yeah, if 246 00:13:23,640 --> 00:13:28,440 Speaker 1: your paycheck to paycheck and bitcoin is volatile, then you 247 00:13:28,600 --> 00:13:33,280 Speaker 1: still have to figure out how to get savings. And 248 00:13:33,920 --> 00:13:38,320 Speaker 1: the form of money that can't be printed is going 249 00:13:38,400 --> 00:13:41,040 Speaker 1: to store your value best over time, but you have 250 00:13:41,120 --> 00:13:44,200 Speaker 1: to get to that point in time. And so it 251 00:13:44,280 --> 00:13:48,360 Speaker 1: becomes the identical equation of saying like, okay, I first 252 00:13:48,400 --> 00:13:51,600 Speaker 1: have to produce more than I consume and then I 253 00:13:51,640 --> 00:13:55,679 Speaker 1: have to start saving a small percentage. And bitcoins is 254 00:13:55,760 --> 00:14:00,840 Speaker 1: that as it's volatile, it doesn't put me back in 255 00:14:00,880 --> 00:14:06,160 Speaker 1: that negative position of being paycheck to paycheck. So another 256 00:14:06,200 --> 00:14:07,800 Speaker 1: way to say it is someone that has a lot 257 00:14:07,800 --> 00:14:10,880 Speaker 1: of savings can more easily adopt bitcoin than someone that 258 00:14:10,880 --> 00:14:15,000 Speaker 1: has no savings at all. But everyone has to accumulate 259 00:14:15,080 --> 00:14:17,880 Speaker 1: savings to get out of that rat race. To get 260 00:14:17,920 --> 00:14:21,200 Speaker 1: out of living paycheck to paycheck. So it becomes a 261 00:14:21,200 --> 00:14:23,200 Speaker 1: world to say, well, hey, maybe you need to have 262 00:14:23,760 --> 00:14:26,960 Speaker 1: enough dollars or a stap quote stable coin that might 263 00:14:27,000 --> 00:14:31,080 Speaker 1: be losing its value slowly but is maintaining its value 264 00:14:31,600 --> 00:14:34,320 Speaker 1: day to day better saying I need to cover myself 265 00:14:34,360 --> 00:14:37,040 Speaker 1: for a month or two months or three months to 266 00:14:37,120 --> 00:14:41,880 Speaker 1: have that security buffer, but then saying well, anything that 267 00:14:42,280 --> 00:14:45,560 Speaker 1: is more than three months, I need to be exposed 268 00:14:45,560 --> 00:14:50,440 Speaker 1: to the asset that stores value over time. And so 269 00:14:50,480 --> 00:14:54,880 Speaker 1: it's marrying the short term needs with the long term 270 00:14:54,920 --> 00:14:59,120 Speaker 1: benefits and such that someone that has no savings realistically 271 00:14:59,160 --> 00:15:01,200 Speaker 1: like they still need to be saving and bitcoin, but 272 00:15:01,560 --> 00:15:03,560 Speaker 1: it might be able to have a smaller percentage because 273 00:15:04,040 --> 00:15:08,080 Speaker 1: their personal working capital is non existent and they need 274 00:15:08,080 --> 00:15:10,920 Speaker 1: to build that up. And so they still have the 275 00:15:10,960 --> 00:15:13,600 Speaker 1: problem and there's no easy way out of it. But 276 00:15:13,680 --> 00:15:17,520 Speaker 1: it becomes a function of each month saving more than 277 00:15:17,560 --> 00:15:23,080 Speaker 1: you than you spend and putting a small amount away. 278 00:15:23,120 --> 00:15:27,120 Speaker 1: But now somebody that has a lot of savings that 279 00:15:27,760 --> 00:15:31,040 Speaker 1: doesn't have, you know, a working capital need of six 280 00:15:31,080 --> 00:15:34,880 Speaker 1: months or a year that then they start looking at 281 00:15:34,920 --> 00:15:38,680 Speaker 1: the equations saying, hey, if I have this in cash 282 00:15:39,120 --> 00:15:41,440 Speaker 1: and in a form of money that loses value, that's 283 00:15:41,480 --> 00:15:44,960 Speaker 1: engineered to lose value. I need to be thinking longer 284 00:15:45,000 --> 00:15:47,680 Speaker 1: than just a month or two months or three months. 285 00:15:47,680 --> 00:15:49,880 Speaker 1: I need to be thinking about a year or ten years, 286 00:15:50,040 --> 00:15:51,840 Speaker 1: and the more that you can save an asset that's 287 00:15:51,920 --> 00:15:56,200 Speaker 1: volatile but stores value better than anything else for very 288 00:15:56,240 --> 00:16:00,560 Speaker 1: logical reasons that everyone needs money, everyone needs set money, 289 00:16:00,720 --> 00:16:03,280 Speaker 1: and people are adopting bitcoin for that reason. Then it 290 00:16:03,320 --> 00:16:08,280 Speaker 1: becomes a kind of time horizon and managing short term 291 00:16:08,360 --> 00:16:11,960 Speaker 1: volatility for the benefit of long term purchasing power. 292 00:16:12,920 --> 00:16:16,000 Speaker 2: So to summarize that, then we have to understand that 293 00:16:16,280 --> 00:16:21,600 Speaker 2: both dollars and bitcoin are both volatile price moves, but 294 00:16:21,840 --> 00:16:24,800 Speaker 2: bitcoin is more volatile to the upside, whereas the dollar 295 00:16:24,920 --> 00:16:28,840 Speaker 2: is just always constantly vaulted to the downside. So we 296 00:16:28,880 --> 00:16:31,400 Speaker 2: want to look at those over different time horizons, where 297 00:16:31,680 --> 00:16:33,440 Speaker 2: think of it as a checking in the savings and 298 00:16:33,440 --> 00:16:36,000 Speaker 2: a little bit And depending on my time horizons and 299 00:16:36,000 --> 00:16:38,120 Speaker 2: the amount of money that I make, then I want 300 00:16:38,160 --> 00:16:41,200 Speaker 2: to be storing in the more volatile asset because it 301 00:16:41,240 --> 00:16:43,800 Speaker 2: holds value better over longer periods of time, But I 302 00:16:43,880 --> 00:16:45,480 Speaker 2: might be willing to put a little bit into the 303 00:16:45,560 --> 00:16:48,400 Speaker 2: less volatile asset that holds value better in a short 304 00:16:48,440 --> 00:16:49,320 Speaker 2: period of time. 305 00:16:49,320 --> 00:16:52,480 Speaker 1: Right, Yeah, correctly, So you know, I always try to 306 00:16:52,520 --> 00:16:54,400 Speaker 1: use it to a tangible examples like, hey, if I 307 00:16:54,400 --> 00:16:59,239 Speaker 1: need to go buy beef at the grocery store tomorrow 308 00:16:59,440 --> 00:17:01,720 Speaker 1: or over the next week, and there's a possibility that 309 00:17:01,720 --> 00:17:03,960 Speaker 1: bitcoin drops by ten percent and I can't then go 310 00:17:04,000 --> 00:17:06,200 Speaker 1: buy the amount of beef that I need, I haven't 311 00:17:06,200 --> 00:17:08,480 Speaker 1: solved my problem. But if I know that the price 312 00:17:08,520 --> 00:17:10,800 Speaker 1: of beef, you know, looking at ground beef, if it 313 00:17:10,840 --> 00:17:12,679 Speaker 1: goes from six dollars a pound to ten dollars a 314 00:17:12,680 --> 00:17:17,600 Speaker 1: pound to fifteen dollars a pound, that I need beef 315 00:17:17,600 --> 00:17:22,119 Speaker 1: in six months too. And if I'm just saving in 316 00:17:22,160 --> 00:17:24,920 Speaker 1: this form of money, that is the other side of 317 00:17:24,960 --> 00:17:28,119 Speaker 1: that same coin, which we discussed before, like your your 318 00:17:28,119 --> 00:17:31,080 Speaker 1: groceres aren't getting more expensive, your money is losing value. 319 00:17:31,080 --> 00:17:33,120 Speaker 1: That you need beef next week, but you also need 320 00:17:33,160 --> 00:17:35,600 Speaker 1: beef in six months. If you do the same thing 321 00:17:36,160 --> 00:17:38,040 Speaker 1: for the next week that you're trying to solve for 322 00:17:39,000 --> 00:17:41,840 Speaker 1: in six months or a year, you're gonna end up 323 00:17:42,119 --> 00:17:43,160 Speaker 1: in a far worse place. 324 00:17:43,240 --> 00:17:47,960 Speaker 2: Yeah, because the dollar might buy you more beef next week, 325 00:17:48,080 --> 00:17:51,040 Speaker 2: but it's most likely guaranteed to buy you less beef 326 00:17:51,040 --> 00:17:56,000 Speaker 2: in a year. Yeah, let's talk about than the dollar, 327 00:17:56,080 --> 00:18:00,800 Speaker 2: but more specially stable coins. So sort of maybe somewhat 328 00:18:00,680 --> 00:18:03,119 Speaker 2: historic here in the United States, we just passed this 329 00:18:03,200 --> 00:18:06,720 Speaker 2: genius Act, the Stable Cooin Act. Scott Assent, the head 330 00:18:06,720 --> 00:18:10,720 Speaker 2: of the Treasury, whose job is to sell US debt, right, 331 00:18:10,800 --> 00:18:14,240 Speaker 2: that's his primary job, sell the treasuries. He's some dude 332 00:18:14,240 --> 00:18:16,520 Speaker 2: pushing towards these stable coins. He said that he sees 333 00:18:16,520 --> 00:18:19,280 Speaker 2: stable coins growing by three points set to three point 334 00:18:19,359 --> 00:18:23,560 Speaker 2: seven trillion by twenty thirty. I saw you were talking 335 00:18:23,560 --> 00:18:26,280 Speaker 2: about the difference of dollars in that, but I think 336 00:18:26,320 --> 00:18:29,200 Speaker 2: I saw you make a tweet something about it being 337 00:18:29,280 --> 00:18:32,240 Speaker 2: like regulatory capture. Yeah. 338 00:18:32,359 --> 00:18:40,600 Speaker 1: So the if you play it out again, this is, 339 00:18:40,880 --> 00:18:44,680 Speaker 1: you know, balancing short term of long term. That the 340 00:18:45,240 --> 00:18:53,760 Speaker 1: short term benefit is that there's a a positive regulatory 341 00:18:53,880 --> 00:19:01,600 Speaker 1: stance towards the digital currency world, which it is. And yeah, 342 00:19:01,640 --> 00:19:04,080 Speaker 1: we can say that that's I won't say it's undeniable, 343 00:19:04,119 --> 00:19:05,560 Speaker 1: but it's close to undeniable. 344 00:19:05,560 --> 00:19:07,439 Speaker 2: It's like, hey, there's a regulatory stands too. 345 00:19:07,760 --> 00:19:11,720 Speaker 1: That's that's positive, that that's welcoming to this in the 346 00:19:11,880 --> 00:19:15,400 Speaker 1: US right now. Yeah, Yeah, And that's better than if 347 00:19:16,000 --> 00:19:18,640 Speaker 1: Elizabeth Warren was going out trying to whack the mole. 348 00:19:18,760 --> 00:19:23,200 Speaker 1: Everybody working on bitcoin or the broader what people refer 349 00:19:23,280 --> 00:19:27,520 Speaker 1: to is the crypto space that you want that that 350 00:19:27,640 --> 00:19:35,600 Speaker 1: it's better to have a regulatory apparatus that is friend, 351 00:19:35,680 --> 00:19:42,080 Speaker 1: not foe. But long term, if you think about stable 352 00:19:42,119 --> 00:19:47,159 Speaker 1: coins that are that are backed by dollars, it's not 353 00:19:47,280 --> 00:19:51,840 Speaker 1: actually solving a problem, and that the very same interests 354 00:19:51,880 --> 00:19:58,119 Speaker 1: that are helping to instantiate stable coins do not have 355 00:19:58,320 --> 00:20:03,400 Speaker 1: an interest in in private versions of the dollar existing. 356 00:20:03,480 --> 00:20:09,240 Speaker 1: Long term, they get immense control and power out of 357 00:20:09,960 --> 00:20:12,040 Speaker 1: having a digital version of the dollar that's controlled by 358 00:20:12,080 --> 00:20:15,760 Speaker 1: the Fed, and that the larger that a stable coin grows, 359 00:20:16,400 --> 00:20:22,000 Speaker 1: the more control that the the Fed and the Treasury 360 00:20:22,119 --> 00:20:24,399 Speaker 1: or the Office of the Presidency would want to have 361 00:20:24,560 --> 00:20:30,000 Speaker 1: over it. Right, it becomes unavoidable, genuinely, and so that 362 00:20:30,280 --> 00:20:32,680 Speaker 1: the law in my view, the large interest that we're 363 00:20:32,760 --> 00:20:37,520 Speaker 1: pushing the stable coin apt or special interests that wanted 364 00:20:37,640 --> 00:20:41,240 Speaker 1: their stable coin to be able to be the winner 365 00:20:41,320 --> 00:20:44,640 Speaker 1: because they have seniorage and they will extract value out 366 00:20:44,680 --> 00:20:47,479 Speaker 1: of that. And so in the short term it can 367 00:20:47,520 --> 00:20:52,200 Speaker 1: feel like a positive because there's you know, women, I'm 368 00:20:52,200 --> 00:20:56,040 Speaker 1: picking from a bitcoin lens that there are advocates that 369 00:20:56,200 --> 00:20:59,879 Speaker 1: are that are friendly to an adjacent industry, not bitcoin specifically, 370 00:21:00,400 --> 00:21:02,520 Speaker 1: and that there might be short term benefits that come 371 00:21:02,560 --> 00:21:05,080 Speaker 1: from that, and it would be certainly better than an 372 00:21:05,200 --> 00:21:09,040 Speaker 1: active foe trying to go stamp out bitcoin companies. But 373 00:21:09,400 --> 00:21:12,320 Speaker 1: the larger that a stable coin grows, the more control 374 00:21:12,880 --> 00:21:16,639 Speaker 1: the existing state apparatus is going to naturally have over it, 375 00:21:17,119 --> 00:21:22,320 Speaker 1: and the interest of companies like coinbase and usd C 376 00:21:22,960 --> 00:21:26,120 Speaker 1: or anyone that interacts and helps move that stable coin 377 00:21:26,640 --> 00:21:30,120 Speaker 1: is going to be to you know, use our stable coin, 378 00:21:30,160 --> 00:21:33,280 Speaker 1: not that stable coin, and that that's ultimately the root 379 00:21:33,400 --> 00:21:37,439 Speaker 1: of you know, tether has worked perfectly well all over 380 00:21:37,440 --> 00:21:39,879 Speaker 1: the world without this. Why does it need this? The 381 00:21:39,960 --> 00:21:42,760 Speaker 1: only reason it needs this is to ensure that the 382 00:21:42,800 --> 00:21:44,800 Speaker 1: state apparats doesn't come to shut it down. But then 383 00:21:45,080 --> 00:21:49,240 Speaker 1: the other side of that coin is control. You know that, 384 00:21:49,680 --> 00:21:52,520 Speaker 1: you know why, why if the free market has been working, 385 00:21:52,600 --> 00:21:54,840 Speaker 1: why not allow the free market to continue to work. 386 00:21:55,400 --> 00:22:00,800 Speaker 1: The logical explanation of it is is control surveillance, And 387 00:22:02,040 --> 00:22:04,280 Speaker 1: it might not play out in the next week or 388 00:22:04,320 --> 00:22:07,040 Speaker 1: the next month, but that's the direction that it's heading 389 00:22:07,119 --> 00:22:11,399 Speaker 1: and in my view, we have serious problems they need 390 00:22:11,520 --> 00:22:15,320 Speaker 1: serious people to solve them. The fact that bitcoin was 391 00:22:15,359 --> 00:22:20,800 Speaker 1: de emphasized for stable coin legislation or market structure legislation, 392 00:22:21,640 --> 00:22:27,879 Speaker 1: it just yeah to me, it points to regulatory capture 393 00:22:27,960 --> 00:22:28,800 Speaker 1: versus innovation. 394 00:22:29,280 --> 00:22:32,320 Speaker 2: Yeah. Part of the Genius Act, there was a couple 395 00:22:32,320 --> 00:22:34,080 Speaker 2: of bills that went through. One was also called the 396 00:22:34,160 --> 00:22:37,600 Speaker 2: Clarity Act, And that's how I felt about that bill specifically, 397 00:22:38,000 --> 00:22:40,480 Speaker 2: because like in America, we're the land of the Free. 398 00:22:40,520 --> 00:22:41,920 Speaker 2: We're supposed to be able to do whatever we want 399 00:22:42,480 --> 00:22:44,119 Speaker 2: and then laws are meant to tell us what we 400 00:22:44,200 --> 00:22:47,320 Speaker 2: can't do. But here they're passing a Clarity Act to 401 00:22:47,920 --> 00:22:50,040 Speaker 2: give us clarity on what we can do, which I 402 00:22:50,040 --> 00:22:52,800 Speaker 2: thought was kind of weird. So I see that going 403 00:22:52,880 --> 00:22:54,760 Speaker 2: that way. But let's just kind of go back to 404 00:22:54,880 --> 00:22:58,040 Speaker 2: what you're what you're staying here. So it seems like, well, 405 00:22:58,160 --> 00:23:00,160 Speaker 2: number one, the government's not a monolith, right, So there's 406 00:23:00,240 --> 00:23:02,560 Speaker 2: like multiple factions that have different interests that they want 407 00:23:02,600 --> 00:23:06,280 Speaker 2: to see. I think both Trump and Thescent want to 408 00:23:06,359 --> 00:23:10,160 Speaker 2: see the dollar maintain some power around the world. Sixty 409 00:23:10,240 --> 00:23:13,280 Speaker 2: percent of FX transactions or something like that. Right now, 410 00:23:13,320 --> 00:23:16,639 Speaker 2: we just drop down to a fifty nine percent. The 411 00:23:16,760 --> 00:23:19,320 Speaker 2: cent wants to sell treasuries. Who's going to buy the treasuries? 412 00:23:19,359 --> 00:23:22,320 Speaker 2: And so by getting people around the world who use 413 00:23:22,359 --> 00:23:25,000 Speaker 2: dollar stable coins, it sort of keeps the dollars sort 414 00:23:25,040 --> 00:23:28,520 Speaker 2: of demand. And then for the regulatory part that we 415 00:23:28,560 --> 00:23:31,119 Speaker 2: make those stable cod in companies by US treasuries and 416 00:23:31,160 --> 00:23:32,920 Speaker 2: then sort of de facto you get the people around 417 00:23:32,960 --> 00:23:35,440 Speaker 2: the world to buy US treasuries. I mean, would you 418 00:23:35,480 --> 00:23:37,760 Speaker 2: say that seems to be what's that play here? 419 00:23:39,040 --> 00:23:44,120 Speaker 1: I think that's the that's the line of thinking. That's 420 00:23:44,160 --> 00:23:49,960 Speaker 1: a first derivative, that sounds good, sounds right, sounds plausible, 421 00:23:50,880 --> 00:23:54,879 Speaker 1: and so people run with it. They say, hey, these 422 00:23:54,920 --> 00:23:59,119 Speaker 1: stable coins are great for the US dollar safety and 423 00:23:59,240 --> 00:24:03,200 Speaker 1: muse again. He gave a great presentation at the Bitcoin 424 00:24:03,320 --> 00:24:10,200 Speaker 1: Conference where he basically explained that it's substitute demand. It's 425 00:24:10,240 --> 00:24:12,960 Speaker 1: not creating demand for the treasury. Somebody has to own 426 00:24:13,040 --> 00:24:16,000 Speaker 1: all treasuries at all times. If you think about what's 427 00:24:16,040 --> 00:24:20,040 Speaker 1: actually happening in the financial system. If somebody is choosing 428 00:24:20,200 --> 00:24:25,840 Speaker 1: to convert a deposit at a at a US bank 429 00:24:26,520 --> 00:24:31,399 Speaker 1: to a dollar stable coin, somewhere in the background, a 430 00:24:31,520 --> 00:24:33,560 Speaker 1: reserve at the Fed is changing from one account to 431 00:24:33,600 --> 00:24:39,359 Speaker 1: the other, and that somebody was holding a treasury and 432 00:24:39,440 --> 00:24:41,000 Speaker 1: now somebody else is holding the treasure. 433 00:24:41,200 --> 00:24:43,479 Speaker 2: Is it and is it the government holding it they 434 00:24:43,520 --> 00:24:45,000 Speaker 2: had to print the money on buying their own or 435 00:24:45,080 --> 00:24:46,800 Speaker 2: is it someone in Argentina or Venezuela. 436 00:24:47,359 --> 00:24:52,720 Speaker 1: Right, But if somebody, you know, imagine the scenario where 437 00:24:52,760 --> 00:24:59,280 Speaker 1: there's a a central bank in Africa and the person 438 00:24:59,320 --> 00:25:02,200 Speaker 1: African says, I want to hold a US dollar stable coin. Well, 439 00:25:03,240 --> 00:25:08,000 Speaker 1: the dollar doesn't just disappear. So the central bank in 440 00:25:08,000 --> 00:25:10,680 Speaker 1: Africa might have bought a treasury. Now the you know, 441 00:25:10,960 --> 00:25:13,200 Speaker 1: the private company that issued the stable coin is buying 442 00:25:13,240 --> 00:25:16,919 Speaker 1: the treasury. You know, it didn't it changed the treasury, 443 00:25:16,960 --> 00:25:21,120 Speaker 1: It changed hand. It didn't create demand for the US treasury. 444 00:25:21,560 --> 00:25:24,879 Speaker 1: And so I think that realistically, what it more so 445 00:25:25,240 --> 00:25:30,720 Speaker 1: is is it's a new rail to move dollars. I 446 00:25:30,800 --> 00:25:33,520 Speaker 1: think about it more as a method of payment. It doesn't. 447 00:25:33,600 --> 00:25:37,560 Speaker 1: It doesn't. It genuinely does not create demand. Like as 448 00:25:37,560 --> 00:25:41,840 Speaker 1: an example, Blackrock is the largest holder. I think if 449 00:25:41,880 --> 00:25:45,120 Speaker 1: it's not the large holder, it's one of the top 450 00:25:45,480 --> 00:25:52,160 Speaker 1: two or three holders of US treasuries. If their assets 451 00:25:52,440 --> 00:25:56,000 Speaker 1: shift to some other party and say it's a party 452 00:25:56,040 --> 00:25:58,879 Speaker 1: that wants to hold stable coins. It's like somebody is 453 00:25:58,920 --> 00:26:05,160 Speaker 1: banking blackrock, somebody's back banking the stable coin. That's the foundation. 454 00:26:05,800 --> 00:26:09,600 Speaker 1: It's like the stable coin is not creating demand, shifting demand. 455 00:26:10,040 --> 00:26:13,200 Speaker 2: It's shifting demand. But I want to we'll get into 456 00:26:13,480 --> 00:26:15,760 Speaker 2: sort of the failing system that we have in a 457 00:26:15,760 --> 00:26:17,960 Speaker 2: little bit, But just to talk about this for a second. 458 00:26:19,640 --> 00:26:23,159 Speaker 2: If there's a massive demand external demand for US treasury, 459 00:26:23,240 --> 00:26:25,600 Speaker 2: is easier for the US to sell the treasuries into 460 00:26:25,600 --> 00:26:28,680 Speaker 2: the market and manage the debt. Whereas if the government 461 00:26:28,920 --> 00:26:31,000 Speaker 2: has to, as we've seen many times other countries around 462 00:26:31,000 --> 00:26:33,640 Speaker 2: the world, have to print money to buy their own debt, 463 00:26:34,680 --> 00:26:37,959 Speaker 2: it goes into a deep, a pretty fast doom loop. Right, 464 00:26:38,440 --> 00:26:40,879 Speaker 2: So if we have to print money to buy our 465 00:26:40,920 --> 00:26:43,280 Speaker 2: own debt, that's a problem. Versus if there's a massive 466 00:26:43,280 --> 00:26:46,000 Speaker 2: demand externally for our debt, then it's not as bad. 467 00:26:46,600 --> 00:26:50,080 Speaker 2: And so I would say to the point that you're making, Yes, 468 00:26:50,320 --> 00:26:53,239 Speaker 2: the Treasury has to whatever debt they need to send out, 469 00:26:53,240 --> 00:26:55,280 Speaker 2: they need to send out, so there's the demand. But 470 00:26:55,359 --> 00:26:57,119 Speaker 2: as far as shifting the demand, if they have to 471 00:26:57,200 --> 00:26:59,400 Speaker 2: print and buy it themselves, it's much worse. Than if 472 00:26:59,640 --> 00:27:02,040 Speaker 2: some and I think you said, Zimbabwe, Africa buy is 473 00:27:02,080 --> 00:27:02,640 Speaker 2: it right? 474 00:27:02,720 --> 00:27:06,440 Speaker 1: What I'm saying is we all have to accept that 475 00:27:08,160 --> 00:27:11,120 Speaker 1: the only way that thirty six trillion or thirty seven 476 00:27:11,160 --> 00:27:15,080 Speaker 1: trillion of debt is getting repaid is because the FED 477 00:27:15,160 --> 00:27:17,440 Speaker 1: is going to create more of it. Sure, everything else 478 00:27:17,560 --> 00:27:21,240 Speaker 1: is moving chairs around on the on the deck. Because 479 00:27:22,680 --> 00:27:29,399 Speaker 1: two things are categorically true. The Treasury sets the number 480 00:27:29,440 --> 00:27:35,600 Speaker 1: of treasuries that exist, and Congress based on the amount 481 00:27:35,960 --> 00:27:38,840 Speaker 1: that they spend. First, the amount that they take in 482 00:27:39,640 --> 00:27:40,480 Speaker 1: is in relation to that. 483 00:27:41,200 --> 00:27:42,679 Speaker 2: But the Treasure is the budget. 484 00:27:43,240 --> 00:27:46,159 Speaker 1: The budget the budget. So if you know the report 485 00:27:46,200 --> 00:27:48,240 Speaker 1: that came out the other day is that just in 486 00:27:48,359 --> 00:27:51,680 Speaker 1: the next two quarters, the Treasury is going to have 487 00:27:51,800 --> 00:27:56,919 Speaker 1: to issue net incremental treasuries of one point six trillion. 488 00:27:58,040 --> 00:27:59,800 Speaker 1: The debt of the United States is growing by one 489 00:28:00,000 --> 00:28:06,400 Speaker 1: point six trillion over the next two quarters. That's the Treasury. 490 00:28:06,560 --> 00:28:09,680 Speaker 1: In Congress, the FED is the single entity that sets 491 00:28:09,920 --> 00:28:13,879 Speaker 1: the number of dollars that exist in the system. If 492 00:28:13,920 --> 00:28:16,000 Speaker 1: the FED is not increasing the number of dollars that 493 00:28:16,119 --> 00:28:19,359 Speaker 1: exist in the system, and the Treasury is having to 494 00:28:19,880 --> 00:28:23,880 Speaker 1: increase the supply of treasuries by one point six trillion. 495 00:28:24,320 --> 00:28:27,119 Speaker 1: It's having to take out money from somewhere else in 496 00:28:27,240 --> 00:28:33,480 Speaker 1: the system to replace that demand. Right, so as as 497 00:28:33,560 --> 00:28:36,520 Speaker 1: more treasuries exist, if the amount of dollars didn't increase, 498 00:28:38,320 --> 00:28:41,560 Speaker 1: it's sucking money either out of the private sector or 499 00:28:41,600 --> 00:28:45,160 Speaker 1: out of some other public sector need for money. And 500 00:28:46,840 --> 00:28:48,880 Speaker 1: the only way it gets solved, the only way the 501 00:28:49,360 --> 00:28:52,680 Speaker 1: leaky ship gets solved, is the FED creating more dollars. 502 00:28:53,360 --> 00:28:55,240 Speaker 1: You know, That's why Trump's going to the Fed and 503 00:28:55,320 --> 00:28:59,680 Speaker 1: saying you got to increase the interest rate by three percent. Well, 504 00:29:00,480 --> 00:29:03,760 Speaker 1: the only way to lower interest rates in terms of 505 00:29:04,480 --> 00:29:09,120 Speaker 1: the like the real the real interest rate is printing money. Right, 506 00:29:09,960 --> 00:29:13,880 Speaker 1: so more dollars have to exist to release the pressure 507 00:29:14,640 --> 00:29:17,320 Speaker 1: of the market rate to borrow. 508 00:29:17,400 --> 00:29:19,520 Speaker 2: But does the Fed have to create the dollars because 509 00:29:19,560 --> 00:29:23,360 Speaker 2: the euro dollar market is dollars increasing, well, not the 510 00:29:23,400 --> 00:29:24,200 Speaker 2: Fed doing anything. 511 00:29:24,360 --> 00:29:28,760 Speaker 1: Well, the same dilemma exists on the euroside, like the 512 00:29:29,120 --> 00:29:32,400 Speaker 1: European Centi Bank ultimately has to create more euros to 513 00:29:32,480 --> 00:29:37,800 Speaker 1: satisfy euro denominated debt. Well, euro dollars is the intersection 514 00:29:37,960 --> 00:29:38,120 Speaker 1: of that. 515 00:29:38,360 --> 00:29:38,600 Speaker 2: But the. 516 00:29:40,640 --> 00:29:42,800 Speaker 1: Dollars need to be supplied, I don't say need to 517 00:29:42,840 --> 00:29:44,760 Speaker 1: be but the way that the current market is structured, 518 00:29:44,840 --> 00:29:48,400 Speaker 1: is that ultimately more dollars need to support more dollar 519 00:29:48,480 --> 00:29:51,400 Speaker 1: nominated debt. You can again, like, if the FED isn't 520 00:29:51,400 --> 00:29:55,080 Speaker 1: creating any more money, the Treasury is issuing one point 521 00:29:55,120 --> 00:29:58,640 Speaker 1: six trillion, there are one point six trillion more deposits 522 00:29:59,080 --> 00:30:02,960 Speaker 1: credit claims on dollars that exists out there without the FED. 523 00:30:04,280 --> 00:30:08,800 Speaker 1: My point is that the market figures out that the 524 00:30:08,960 --> 00:30:12,640 Speaker 1: actual funding currency is becoming more scarce to the amount 525 00:30:12,680 --> 00:30:16,000 Speaker 1: of claims on it. That causes interest rates to rise. 526 00:30:17,080 --> 00:30:19,520 Speaker 1: The only way to actually solve that is the FED 527 00:30:19,880 --> 00:30:23,720 Speaker 1: singularly sets the number of dollars that exists in the system, 528 00:30:24,200 --> 00:30:26,320 Speaker 1: the dollars that can move from bank to bank. 529 00:30:27,800 --> 00:30:29,800 Speaker 2: And your a dollar market can't create those. 530 00:30:30,480 --> 00:30:34,640 Speaker 1: They can create more claims on the base money, but 531 00:30:34,720 --> 00:30:36,720 Speaker 1: they can't create more of the base money. 532 00:30:39,000 --> 00:30:46,479 Speaker 2: What about if billions of dollars of Argentine pesos convert 533 00:30:46,600 --> 00:30:47,560 Speaker 2: into US dollars. 534 00:30:48,720 --> 00:30:54,960 Speaker 1: Again, there's a relationship between the actual number of pesos 535 00:30:55,000 --> 00:30:57,440 Speaker 1: that exist in the world that are created by their 536 00:30:57,520 --> 00:31:00,280 Speaker 1: central bank, and there are the number of dolls dollars 537 00:31:00,320 --> 00:31:02,719 Speaker 1: that exist created by our central bank, and then there 538 00:31:02,760 --> 00:31:06,640 Speaker 1: are claims on those dollars. So it's like, yes, if 539 00:31:06,960 --> 00:31:13,520 Speaker 1: somebody wanted to convert pesos to dollars, creates demand for dollars, 540 00:31:15,320 --> 00:31:17,920 Speaker 1: creates lack of demand for paces, which dictates that the 541 00:31:18,760 --> 00:31:22,200 Speaker 1: peso issuer needs to issue more pasos or their system collapse. 542 00:31:22,760 --> 00:31:25,440 Speaker 2: So it's Robin, Peter pay Paul is shuffling cars on 543 00:31:25,480 --> 00:31:25,800 Speaker 2: the deck. 544 00:31:25,880 --> 00:31:28,840 Speaker 1: But what it's doing, but the foundation of it that 545 00:31:28,960 --> 00:31:32,360 Speaker 1: dictates all of it is the central issuer, right, And 546 00:31:32,440 --> 00:31:35,000 Speaker 1: if you are creating more debt on top of the 547 00:31:35,080 --> 00:31:38,440 Speaker 1: existing money supply, Ultimately people figure out that there are 548 00:31:38,600 --> 00:31:42,000 Speaker 1: enough chairs on the deck and they saw all going 549 00:31:42,080 --> 00:31:43,920 Speaker 1: to sit down at the same time to get there 550 00:31:44,240 --> 00:31:46,120 Speaker 1: the dollars that they need at the paces that they need. 551 00:31:46,560 --> 00:31:49,520 Speaker 1: That causes a credit collapse, that causes interest rates to rise, 552 00:31:50,600 --> 00:31:54,600 Speaker 1: that induces the acceleration of money printed. There's no way 553 00:31:54,640 --> 00:31:55,040 Speaker 1: around it. 554 00:31:55,800 --> 00:32:00,960 Speaker 2: There's no way around it. It's inevitable how that looks, 555 00:32:01,120 --> 00:32:03,520 Speaker 2: and the timeframe of those things vary based off of 556 00:32:03,600 --> 00:32:05,840 Speaker 2: how good they can shuffle cards around the deck. So 557 00:32:06,000 --> 00:32:09,320 Speaker 2: the milkshake theory from Brent Johnson is that all it 558 00:32:09,360 --> 00:32:11,600 Speaker 2: puts a lot of pressure on Urgerden payso they collapse 559 00:32:11,680 --> 00:32:13,800 Speaker 2: and then the dollar kind of just keeps sucking more 560 00:32:13,800 --> 00:32:16,720 Speaker 2: and more, and things keep collapsing faster and faster and faster. 561 00:32:17,640 --> 00:32:22,360 Speaker 1: Right, so one system could collapse faster than another system. 562 00:32:23,040 --> 00:32:26,240 Speaker 1: But again, if the Treasury is issuing one point six 563 00:32:26,360 --> 00:32:28,560 Speaker 1: you know, like using the microcosm of the example that 564 00:32:28,760 --> 00:32:31,960 Speaker 1: it's a real example based on their own estimates, they're 565 00:32:32,080 --> 00:32:36,360 Speaker 1: issuing one point six trillion more in dollar denominated debt, 566 00:32:36,800 --> 00:32:39,880 Speaker 1: that is more, and if the Fed is not increasing 567 00:32:39,960 --> 00:32:43,480 Speaker 1: the money supply, that is more claims on the same 568 00:32:43,480 --> 00:32:46,360 Speaker 1: amount of dollars. That forces the dollar interest rate higher, right, 569 00:32:47,400 --> 00:32:50,120 Speaker 1: you know, so it's like, yes, you know, the dollar 570 00:32:50,200 --> 00:32:54,760 Speaker 1: milkshake theory can can be accurate, and that the PASO 571 00:32:54,960 --> 00:33:00,240 Speaker 1: could collapse faster than the dollar, but the same dynamic existence. 572 00:33:00,480 --> 00:33:01,720 Speaker 2: Just a function of the system. 573 00:33:01,760 --> 00:33:04,160 Speaker 1: It's collapsing slower, it's not not collapsing. 574 00:33:04,280 --> 00:33:05,840 Speaker 2: Sure, Sure, it's a function of the system. 575 00:33:06,280 --> 00:33:09,600 Speaker 1: And then ultimately Bitcoin becomes the release valve because as 576 00:33:09,680 --> 00:33:13,600 Speaker 1: the market figures out, okay, well, the Treasury had to 577 00:33:13,640 --> 00:33:16,800 Speaker 1: issue one point six trillion more dollars, that's more claims 578 00:33:16,840 --> 00:33:18,960 Speaker 1: on dollars competing with the same amount of dollars. The 579 00:33:19,080 --> 00:33:22,440 Speaker 1: only way to satisfy that demand is to force interest 580 00:33:22,520 --> 00:33:24,960 Speaker 1: rates higher. Oh well, now the FED steps in and 581 00:33:25,000 --> 00:33:29,840 Speaker 1: prints more dollars. Shit, there is no rate of interest 582 00:33:29,920 --> 00:33:34,680 Speaker 1: I can get on a dollar nominated claim that performs 583 00:33:34,720 --> 00:33:36,560 Speaker 1: better than just holding the form of money that is 584 00:33:37,160 --> 00:33:41,680 Speaker 1: agnostic to this whole charade. And so to come back 585 00:33:41,760 --> 00:33:44,960 Speaker 1: to this idea that stable coins create demand for dollars, No, 586 00:33:45,600 --> 00:33:48,520 Speaker 1: they just shift from one party, and one party might 587 00:33:48,560 --> 00:33:52,200 Speaker 1: be more inclined to buy US treasuries over some other 588 00:33:52,400 --> 00:33:56,280 Speaker 1: instrument in the US financial system, depending on you know, 589 00:33:56,960 --> 00:34:00,240 Speaker 1: it's moving out of one bank holding reserves to an other. 590 00:34:00,880 --> 00:34:06,400 Speaker 1: But it's all like you miss the forest for the 591 00:34:06,480 --> 00:34:09,279 Speaker 1: trees if you don't realize that all of that is 592 00:34:09,360 --> 00:34:13,320 Speaker 1: just debt chairs shifting. And what really matters is the 593 00:34:13,400 --> 00:34:17,680 Speaker 1: total amount of system debt. That isn't just the US Treasury, 594 00:34:17,960 --> 00:34:24,400 Speaker 1: it's every private issuer of credit, every state, local municipality 595 00:34:24,480 --> 00:34:28,040 Speaker 1: issuing debt. The relationship of the total debt stack to 596 00:34:28,160 --> 00:34:30,480 Speaker 1: the actual number of dollars that are in the system 597 00:34:30,880 --> 00:34:34,160 Speaker 1: that can support it. Because what happens is for intermittent 598 00:34:34,160 --> 00:34:37,600 Speaker 1: periods of time is that debt expands significantly without the 599 00:34:37,719 --> 00:34:42,080 Speaker 1: actual number of dollars increasing to support it. The market 600 00:34:42,120 --> 00:34:45,200 Speaker 1: figures it out, there becomes a credit collapse, they print 601 00:34:45,239 --> 00:34:49,719 Speaker 1: more money twentsand and eight nine twenty twenty, guaranteed to 602 00:34:49,880 --> 00:34:55,719 Speaker 1: happen again. And the only true exit valve from that 603 00:34:56,560 --> 00:34:59,960 Speaker 1: is to get in the money that is not subject, 604 00:35:00,800 --> 00:35:03,240 Speaker 1: that is entirely divorced from the function of credit. 605 00:35:03,760 --> 00:35:05,640 Speaker 2: Get off the deck where they're shuffling chairs and onto 606 00:35:05,680 --> 00:35:08,719 Speaker 2: something else. So let's talk about the relief valve. So 607 00:35:10,440 --> 00:35:13,800 Speaker 2: Howard Lutnik, Secretary of Commerce, before he came into the 608 00:35:13,800 --> 00:35:18,520 Speaker 2: Trump administration, through his fund, Cantor Fitzgerald, was jumped into bitcoin, 609 00:35:18,600 --> 00:35:21,439 Speaker 2: big zoime right, two point or two billion dollar credit line, 610 00:35:22,480 --> 00:35:26,560 Speaker 2: major stakes in micro strategy, major stakes in tether. Now, 611 00:35:26,719 --> 00:35:30,640 Speaker 2: with the Trump administration building a bitcoin reserve, maybe this 612 00:35:30,680 --> 00:35:34,239 Speaker 2: sovereign wealth fund his son now is deploying billions of 613 00:35:34,320 --> 00:35:38,360 Speaker 2: dollars into bitcoin companies. Trump himself just bought two billion 614 00:35:38,680 --> 00:35:41,440 Speaker 2: not himself but through his company which he owns control 615 00:35:41,520 --> 00:35:44,440 Speaker 2: and interest of bought two billion dollars worth of bitcoin 616 00:35:44,480 --> 00:35:47,960 Speaker 2: a week or two ago. Trump seems to have a 617 00:35:48,400 --> 00:35:51,160 Speaker 2: way of maybe front running the markets and even telegraphing 618 00:35:51,280 --> 00:35:53,720 Speaker 2: what's coming. He said, you might want to buy stocks 619 00:35:53,760 --> 00:35:56,680 Speaker 2: right right before the tariff deal was announced. I think 620 00:35:56,800 --> 00:36:01,000 Speaker 2: there could be a case where the government wants bitcoin 621 00:36:01,280 --> 00:36:05,680 Speaker 2: and gold maybe to run really hot. So we saw 622 00:36:06,040 --> 00:36:10,759 Speaker 2: elon musk leave dose. We can't cut. It's never gonna work. 623 00:36:10,920 --> 00:36:12,759 Speaker 2: We have to grow away out of it. It's cop 624 00:36:12,800 --> 00:36:14,880 Speaker 2: a cent goes on the TV saying we have to 625 00:36:14,960 --> 00:36:16,960 Speaker 2: grow away out of it. So we need to let 626 00:36:17,000 --> 00:36:20,399 Speaker 2: inflation run hot. Hopefully GDP goes up faster than the debt. 627 00:36:21,160 --> 00:36:24,399 Speaker 2: Maybe stable coins can fuel some of that by maybe 628 00:36:24,440 --> 00:36:27,279 Speaker 2: getting some money into directly to the market, maybe get 629 00:36:27,320 --> 00:36:30,440 Speaker 2: more inflation going. We have to grow away out of it. 630 00:36:30,600 --> 00:36:32,080 Speaker 2: But the problem is if we have a lot of 631 00:36:32,120 --> 00:36:36,000 Speaker 2: inflation prices going up too fast, people get unhappy. But 632 00:36:36,160 --> 00:36:38,960 Speaker 2: bitcoin is this liquidity sponge that seems to be not 633 00:36:39,080 --> 00:36:41,719 Speaker 2: seems to be. Is much more sensitive to liquidity than 634 00:36:41,760 --> 00:36:44,960 Speaker 2: other assets, and so potentially if gold and bitcoin could 635 00:36:45,000 --> 00:36:47,799 Speaker 2: absorb a big piece of that liquidity and go up 636 00:36:48,280 --> 00:36:51,040 Speaker 2: maybe faster and higher than most people think, it could 637 00:36:51,200 --> 00:36:54,319 Speaker 2: keep the other assets and prices down a little bit. 638 00:36:55,920 --> 00:36:56,640 Speaker 2: What do you think about that. 639 00:36:58,320 --> 00:37:01,440 Speaker 1: I think that it's again one of those things that 640 00:37:01,640 --> 00:37:07,920 Speaker 1: can sound right in terms of a first derivative that 641 00:37:09,840 --> 00:37:12,800 Speaker 1: fails to see the forest for the trees and is 642 00:37:12,960 --> 00:37:18,160 Speaker 1: not functionally possible, and that this idea that you have 643 00:37:18,360 --> 00:37:21,320 Speaker 1: to grow your way out of the debt. It's like, 644 00:37:21,560 --> 00:37:26,280 Speaker 1: first you have to accept that the US credit system 645 00:37:27,560 --> 00:37:30,880 Speaker 1: has grown faster than even if GDP is a terrible 646 00:37:30,920 --> 00:37:37,200 Speaker 1: metric to measure economic activity, the debt system has grown 647 00:37:37,840 --> 00:37:44,440 Speaker 1: grown faster than GDP for the last thirty years. And 648 00:37:45,239 --> 00:37:48,640 Speaker 1: you're basically saying, Okay, well that has to reverse. But 649 00:37:48,719 --> 00:37:52,439 Speaker 1: what if there's a relationship that dictates, given the level 650 00:37:52,520 --> 00:37:56,279 Speaker 1: of debt that it's not possible. So my point is 651 00:37:56,400 --> 00:38:00,399 Speaker 1: that there's an amount of debt that exists the world, 652 00:38:01,400 --> 00:38:03,319 Speaker 1: and there's amount of dollars that exists in the world, 653 00:38:03,880 --> 00:38:07,800 Speaker 1: and to inchor people into what that general relationship is 654 00:38:08,480 --> 00:38:12,880 Speaker 1: is no, it's like one hundred and two trillion dollars 655 00:38:12,960 --> 00:38:14,440 Speaker 1: of dollar denominated. 656 00:38:13,960 --> 00:38:16,799 Speaker 2: Debt to three hundred and fifty trillion, oh to. 657 00:38:17,040 --> 00:38:20,279 Speaker 1: About six to seven trillion dollars. Oh, and there is 658 00:38:20,320 --> 00:38:23,880 Speaker 1: a mathematical equation. Now, not all of that one hundred 659 00:38:23,880 --> 00:38:28,520 Speaker 1: and two trillion dollars of debt that's owed is due 660 00:38:29,560 --> 00:38:33,120 Speaker 1: in a month or doing two months, or a year 661 00:38:33,640 --> 00:38:36,320 Speaker 1: or five years. Some's not due for thirty years. But 662 00:38:36,400 --> 00:38:40,680 Speaker 1: there's a mathematical relationship between one hundred and two trillion 663 00:38:40,719 --> 00:38:45,640 Speaker 1: dollars of debt to six to seven trillion dollars that 664 00:38:45,719 --> 00:38:50,680 Speaker 1: actually exists in the system, and that the one hundred 665 00:38:50,680 --> 00:38:53,680 Speaker 1: and two trillion dollars debt cannot be satisfied by the 666 00:38:53,719 --> 00:38:57,120 Speaker 1: six to seven trillion dollars. So the idea of like, 667 00:38:57,440 --> 00:38:59,160 Speaker 1: you know, if you would relate this to the idea 668 00:38:59,160 --> 00:39:02,080 Speaker 1: of GDP, like to grow our way out. How do 669 00:39:02,160 --> 00:39:04,840 Speaker 1: you grow your way out if you didn't increase the 670 00:39:04,920 --> 00:39:09,160 Speaker 1: number of dollars? How do you grow out of the one? 671 00:39:09,360 --> 00:39:12,080 Speaker 2: Well, you don't grow your way out. But could we 672 00:39:12,200 --> 00:39:15,920 Speaker 2: go from one hundred and ten to GDP to eighty percent? 673 00:39:16,000 --> 00:39:17,120 Speaker 2: That to GDP change? 674 00:39:17,160 --> 00:39:20,680 Speaker 1: So ratio, Well, we'll set aside debt to GDP for 675 00:39:20,719 --> 00:39:21,160 Speaker 1: a second. 676 00:39:21,520 --> 00:39:22,160 Speaker 2: The real. 677 00:39:23,840 --> 00:39:26,800 Speaker 1: Of consequence ratio is the amount of debt that exists 678 00:39:27,360 --> 00:39:29,040 Speaker 1: to the amount of dollars. How do we how do 679 00:39:29,160 --> 00:39:34,240 Speaker 1: we de leverage that system? There's two ways. There's allow 680 00:39:34,360 --> 00:39:38,640 Speaker 1: the debt to reduce, or there's create more dollars. There's 681 00:39:38,800 --> 00:39:44,239 Speaker 1: no other mathematical way right now. The way that debt 682 00:39:44,360 --> 00:39:49,920 Speaker 1: is reduced is that as debts become due, they get 683 00:39:49,960 --> 00:39:55,440 Speaker 1: repaid and more credits not issued. The problem is that 684 00:39:55,680 --> 00:39:59,160 Speaker 1: because of the extent of the leverage that as soon 685 00:39:59,200 --> 00:40:01,239 Speaker 1: as that credits is so that credit system that was 686 00:40:01,280 --> 00:40:04,400 Speaker 1: one hundred and two trillion went to one hundred trillion 687 00:40:04,520 --> 00:40:11,240 Speaker 1: to ninety eight forces interest rates higher. Okay, and basically 688 00:40:11,719 --> 00:40:14,480 Speaker 1: the market because because the money that because those are 689 00:40:14,719 --> 00:40:17,160 Speaker 1: those are those are dollars that are in somebody say 690 00:40:18,320 --> 00:40:22,080 Speaker 1: account that are no longer there. People are tight. So 691 00:40:22,239 --> 00:40:27,480 Speaker 1: like the economy starts to shrink, or first it starts 692 00:40:27,520 --> 00:40:31,640 Speaker 1: to grow slower. Like basically growth is tied to credit expansion. 693 00:40:32,040 --> 00:40:35,600 Speaker 1: If the credit expansion starts to slow or then decline, 694 00:40:36,560 --> 00:40:39,440 Speaker 1: the absolute amount of leverage is so high it starts 695 00:40:39,480 --> 00:40:43,399 Speaker 1: to feed on itself. One you know, credit contraction begets 696 00:40:43,440 --> 00:40:47,160 Speaker 1: credit contraction ultimately induces a credit collapse that induces the 697 00:40:47,200 --> 00:40:50,120 Speaker 1: printing of more money. And so it's like you can't 698 00:40:50,160 --> 00:40:52,040 Speaker 1: get yourself out of the mathematical equation. 699 00:40:52,239 --> 00:40:52,919 Speaker 2: Like you could. 700 00:40:53,080 --> 00:40:54,880 Speaker 1: You could take a piece of debt that's sitting on 701 00:40:54,960 --> 00:40:57,759 Speaker 1: a on a productive asset, say like an oil and 702 00:40:57,840 --> 00:41:01,680 Speaker 1: gas well, and say, well, you know, cancel the debt 703 00:41:01,760 --> 00:41:03,800 Speaker 1: and now it has a new equity holder. It's just 704 00:41:03,880 --> 00:41:06,000 Speaker 1: that we live in a world that's so leveraged that 705 00:41:06,040 --> 00:41:08,960 Speaker 1: would create you know, and it ultimately will. There's you know, 706 00:41:09,160 --> 00:41:12,200 Speaker 1: it's a catch twenty two. There's no way out of it. 707 00:41:12,360 --> 00:41:14,800 Speaker 1: The way out of it is printing of money or 708 00:41:15,320 --> 00:41:20,040 Speaker 1: the more accelerated decline of the dollar via hyper inflation 709 00:41:20,080 --> 00:41:23,640 Speaker 1: and a credit collapse. So you know, everything else of 710 00:41:23,800 --> 00:41:26,880 Speaker 1: like GDP growth, it's like one hundred and two trillion 711 00:41:26,880 --> 00:41:30,200 Speaker 1: dollars of debt six to seven trillion dollars. The Fed 712 00:41:30,280 --> 00:41:32,960 Speaker 1: sets the number of dollars that exists, and then the 713 00:41:33,040 --> 00:41:36,560 Speaker 1: market creates credit on top of that. But every time 714 00:41:37,000 --> 00:41:39,719 Speaker 1: since you know, realistically two thousand and eight nine, the 715 00:41:39,840 --> 00:41:42,520 Speaker 1: market figured out that something was inherently broken, not everyone 716 00:41:42,640 --> 00:41:48,200 Speaker 1: knows the source of it, and guaranteed they print more money, 717 00:41:48,880 --> 00:41:51,320 Speaker 1: you know, and there's no there's no chasing it. So 718 00:41:51,960 --> 00:41:53,960 Speaker 1: you know, one thing I last one I want to 719 00:41:53,960 --> 00:41:59,520 Speaker 1: say is like when people talk about GDP and outgrowing debt, 720 00:42:01,320 --> 00:42:06,520 Speaker 1: if you lose sight of the real economy and what 721 00:42:06,760 --> 00:42:11,600 Speaker 1: money is supposed to deliver to the economy more goods 722 00:42:11,640 --> 00:42:14,840 Speaker 1: and services that and just think in terms of GDP 723 00:42:14,960 --> 00:42:21,040 Speaker 1: and GDP growth and relationship of you know, how much money, 724 00:42:21,200 --> 00:42:23,440 Speaker 1: more money needs to exist to satisfy it. It's like, 725 00:42:23,560 --> 00:42:26,360 Speaker 1: what is actually broken is the real economy, and the 726 00:42:26,440 --> 00:42:28,799 Speaker 1: real economy is broken because of the printing of money 727 00:42:29,640 --> 00:42:33,560 Speaker 1: that it distorts the actual operation of money, the function 728 00:42:33,800 --> 00:42:37,680 Speaker 1: of money, the price signals of money, and we're not 729 00:42:37,840 --> 00:42:42,560 Speaker 1: going to get to a more stable world until the 730 00:42:42,680 --> 00:42:44,759 Speaker 1: fly is taken out of the ointment. The ability to 731 00:42:44,800 --> 00:42:51,400 Speaker 1: print money is no longer exists because governments adopt bitcoin 732 00:42:51,440 --> 00:42:53,160 Speaker 1: and then they can't print money, and they have to 733 00:42:53,200 --> 00:42:55,840 Speaker 1: be honest in terms of how they finance their operations 734 00:42:55,880 --> 00:42:58,680 Speaker 1: because what happens as a natural consequence is that one 735 00:42:58,680 --> 00:43:02,640 Speaker 1: point six trillion ultimately gets financed by the creation of 736 00:43:02,719 --> 00:43:03,160 Speaker 1: more money. 737 00:43:03,360 --> 00:43:08,160 Speaker 2: Right, the inevitability of the system is we are on 738 00:43:08,239 --> 00:43:11,320 Speaker 2: a debt based monetary system, and because of that, the 739 00:43:11,440 --> 00:43:13,360 Speaker 2: debt has to always grow, and because of that, we 740 00:43:13,480 --> 00:43:16,960 Speaker 2: never pay the debt off, and so the inevitability of 741 00:43:16,960 --> 00:43:18,560 Speaker 2: the system is eventually it ends. 742 00:43:18,600 --> 00:43:21,239 Speaker 1: And the real economy gets destroyed because of that. 743 00:43:21,320 --> 00:43:23,120 Speaker 2: And the real economy gets destroyed because of that. Now 744 00:43:23,160 --> 00:43:29,160 Speaker 2: we have a solution with bitcoin that that can allow people, businesses, individuals, businesses, nonprofits, 745 00:43:29,280 --> 00:43:32,719 Speaker 2: churches and corporations, and even governments start offloading onto another 746 00:43:32,760 --> 00:43:36,600 Speaker 2: ship to maybe try to save itself from the inevitable collapse. 747 00:43:38,200 --> 00:43:40,080 Speaker 2: I guess I was just thinking more in terms of 748 00:43:40,360 --> 00:43:42,960 Speaker 2: shorter term moves. Yeah, the next four years of the 749 00:43:42,960 --> 00:43:46,440 Speaker 2: Trump administration, we saw in the eighties, Israel was facing, 750 00:43:46,680 --> 00:43:51,200 Speaker 2: you know, triple digit debt to GDP ratios. Let high 751 00:43:51,280 --> 00:43:54,520 Speaker 2: double digit inflation happen for three or four years. Inflated 752 00:43:54,560 --> 00:43:57,880 Speaker 2: the GDP, which changed the ratio down to seventy five percent. 753 00:43:58,360 --> 00:44:00,200 Speaker 1: But the only way to do what they I mean, 754 00:44:00,239 --> 00:44:01,880 Speaker 1: I I'm not an expert in that, about what I 755 00:44:01,920 --> 00:44:04,560 Speaker 1: would presume is they printed more money into dealers. 756 00:44:04,640 --> 00:44:06,759 Speaker 2: Sure. Yeah, and that's that's my point. So we're going 757 00:44:06,840 --> 00:44:09,040 Speaker 2: to print a lot more money. Trump wants, as you 758 00:44:09,040 --> 00:44:11,080 Speaker 2: said earlier, right, he wants Powell or the Fed to 759 00:44:11,120 --> 00:44:13,160 Speaker 2: drop rates three points, you know, down to one and 760 00:44:13,200 --> 00:44:16,280 Speaker 2: a half. That's going to print a lot more money. Potentially, 761 00:44:16,400 --> 00:44:19,000 Speaker 2: we can get there's what three point three trillion dollars 762 00:44:19,040 --> 00:44:20,919 Speaker 2: of sterilized reserves sitting in the banks that they could 763 00:44:20,920 --> 00:44:22,800 Speaker 2: issue stable coins against and put that onto the street. 764 00:44:22,920 --> 00:44:25,120 Speaker 2: That's more money. And so that's a lot of inflation. 765 00:44:25,520 --> 00:44:27,120 Speaker 1: But but yeah, it is. 766 00:44:27,239 --> 00:44:28,040 Speaker 2: It's a lot of inflation. 767 00:44:28,440 --> 00:44:31,520 Speaker 1: It's a lot of inflation. And and again I'm not 768 00:44:31,600 --> 00:44:34,800 Speaker 1: an expert in the history of of why More Germany, 769 00:44:35,160 --> 00:44:37,680 Speaker 1: but i I know some of the history. And there 770 00:44:37,760 --> 00:44:42,440 Speaker 1: is this natural phenomenon that that when they say the 771 00:44:42,520 --> 00:44:46,360 Speaker 1: price of bitcoin goes up, you think that you're getting richer. 772 00:44:47,160 --> 00:44:49,719 Speaker 1: When the when the value of your stock market goes up, 773 00:44:49,800 --> 00:44:52,960 Speaker 1: you think that you're getting richer. But it misses what 774 00:44:54,280 --> 00:45:01,920 Speaker 1: wealth is. It misses that the your the day to 775 00:45:02,080 --> 00:45:06,600 Speaker 1: day delivery of goods and services that you consume, and 776 00:45:06,680 --> 00:45:11,920 Speaker 1: the and the increasing base of capital capital and not 777 00:45:12,480 --> 00:45:15,800 Speaker 1: in terms of dollars, but capital in terms of productive 778 00:45:15,840 --> 00:45:19,480 Speaker 1: capacity delivering real goods and services to the market. Right, 779 00:45:19,800 --> 00:45:24,040 Speaker 1: That that's wealth. That that's the thing that improves the 780 00:45:24,160 --> 00:45:30,719 Speaker 1: day to day living of more people. And that when 781 00:45:30,840 --> 00:45:34,960 Speaker 1: you know, someone like Trump might buy bitcoin and think 782 00:45:35,040 --> 00:45:37,440 Speaker 1: that bitcoin's helping the dollar, he might just not be 783 00:45:37,520 --> 00:45:41,719 Speaker 1: seeing the forest for the trees. And that it might 784 00:45:41,800 --> 00:45:43,919 Speaker 1: feel good to all of us when the dollar value 785 00:45:43,920 --> 00:45:48,239 Speaker 1: of our bitcoin goes up. But if more businesses are 786 00:45:48,280 --> 00:45:51,680 Speaker 1: being destroyed than are being created, we're kind of we're 787 00:45:51,680 --> 00:45:56,239 Speaker 1: the boiling frog, right you know. And so it's very 788 00:45:56,360 --> 00:46:00,960 Speaker 1: easy for people to not realize. And I'm talking specifically 789 00:46:01,000 --> 00:46:06,520 Speaker 1: about people that are putting forward legislation or regulations or 790 00:46:06,520 --> 00:46:11,000 Speaker 1: even Trump, you know, buying bitcoin and not seeing the endgame, 791 00:46:11,480 --> 00:46:13,759 Speaker 1: thinking like, oh, it's a good thing if you know, 792 00:46:14,320 --> 00:46:16,200 Speaker 1: the stock market moves up. But like, think about the 793 00:46:16,800 --> 00:46:19,960 Speaker 1: craziness of the stock market. I think, really, you know, 794 00:46:20,120 --> 00:46:23,040 Speaker 1: reach all time highs or the sm P at least, 795 00:46:23,080 --> 00:46:26,600 Speaker 1: and like, you know, it's at an all time high 796 00:46:26,960 --> 00:46:30,400 Speaker 1: and Trump is sitting there telling the Fed chair that 797 00:46:30,719 --> 00:46:32,840 Speaker 1: he's going to fire him to reduce interest rates by 798 00:46:32,880 --> 00:46:37,000 Speaker 1: three percent? Yeah, Like, what good is your stock going 799 00:46:37,120 --> 00:46:43,080 Speaker 1: up if the actual you know, fabric of the productive 800 00:46:43,280 --> 00:46:45,719 Speaker 1: capacity of an economy and being destroyed along with it. 801 00:46:46,080 --> 00:46:50,600 Speaker 2: Yeah, that is certainly correct. Most people, unfortunately, don't see it. 802 00:46:50,680 --> 00:46:52,439 Speaker 2: As we started at the beginning is most people don't 803 00:46:52,480 --> 00:46:55,399 Speaker 2: understand the problem. And so part of the CP lie 804 00:46:55,760 --> 00:46:58,920 Speaker 2: is to get us confused on prices going up as 805 00:46:58,960 --> 00:47:01,919 Speaker 2: inflation and that we don't understand why electronics went down 806 00:47:02,000 --> 00:47:03,880 Speaker 2: and this went up, and we don't understand it's the 807 00:47:03,920 --> 00:47:08,600 Speaker 2: money supply. I think the average American would much rather 808 00:47:08,800 --> 00:47:12,839 Speaker 2: see their home value their retirement accounts go up, even 809 00:47:12,880 --> 00:47:15,279 Speaker 2: if gas went up. A little bit then to see 810 00:47:15,640 --> 00:47:18,400 Speaker 2: all of their life savings get cut in half and 811 00:47:18,560 --> 00:47:21,200 Speaker 2: gas stayed the same. I went down a little bit, right. 812 00:47:21,280 --> 00:47:23,040 Speaker 1: The problem is that they have to consume their house 813 00:47:23,080 --> 00:47:25,040 Speaker 1: every day and they have to consume gas that they 814 00:47:25,120 --> 00:47:25,839 Speaker 1: have to have both. 815 00:47:26,040 --> 00:47:30,480 Speaker 2: Yeah, and you you've mentioned several times like thinking through 816 00:47:30,560 --> 00:47:33,479 Speaker 2: first order derivatives. So if you think through second, third, fourth, 817 00:47:33,560 --> 00:47:35,520 Speaker 2: fifth order, where does this go? And then what then 818 00:47:35,719 --> 00:47:38,680 Speaker 2: then what you see the impending doom that it creates. 819 00:47:39,520 --> 00:47:45,480 Speaker 2: But most people just unfortunately can't see that. Let me 820 00:47:45,520 --> 00:47:50,000 Speaker 2: ask one more question then we'll wrap this up. So 821 00:47:50,320 --> 00:47:53,720 Speaker 2: we've talked about the impending doom, the inevitability of the system. 822 00:47:53,760 --> 00:47:55,960 Speaker 2: It was never going to work, right, it's a function 823 00:47:56,040 --> 00:47:58,960 Speaker 2: of the way the system works. But maybe we're starting 824 00:47:59,000 --> 00:48:02,000 Speaker 2: to see the world waking up to this reality you 825 00:48:02,200 --> 00:48:05,600 Speaker 2: mentioned earlier, you posted a chart of the guilt market 826 00:48:05,719 --> 00:48:08,440 Speaker 2: in the UK is like plunging, and if we look 827 00:48:08,480 --> 00:48:10,680 Speaker 2: at like the long bond around the world, they're all 828 00:48:10,800 --> 00:48:13,320 Speaker 2: like basically making new all time highs. And you mentioned 829 00:48:13,360 --> 00:48:18,640 Speaker 2: it's like a regime change. Yeah, a regime change where 830 00:48:18,680 --> 00:48:20,680 Speaker 2: maybe the entire world there starting to wake up and 831 00:48:20,800 --> 00:48:22,880 Speaker 2: realize that the only way to pay those is printing 832 00:48:23,000 --> 00:48:24,680 Speaker 2: lots of money and we have to go find something 833 00:48:24,760 --> 00:48:26,560 Speaker 2: else or what was the regime change? 834 00:48:28,960 --> 00:48:32,480 Speaker 1: Yeah, So one way I think about this is that 835 00:48:34,400 --> 00:48:39,040 Speaker 1: the academic economists which make up the Federal Reserve or 836 00:48:39,080 --> 00:48:43,600 Speaker 1: central banks all over the world think about pulling levers 837 00:48:45,239 --> 00:48:51,759 Speaker 1: or pulling you know, basically taking actions expecting certain reactions. 838 00:48:52,320 --> 00:48:56,520 Speaker 1: So traditionally the world of academic economists that make up 839 00:48:56,560 --> 00:48:59,879 Speaker 1: central banks think, well, if I increase interest rates, I'll 840 00:49:00,120 --> 00:49:06,759 Speaker 1: decrease inflation. The person in the real economy realizes that 841 00:49:07,000 --> 00:49:11,440 Speaker 1: if you arbitrarily increase interest rates, you're not going to 842 00:49:11,520 --> 00:49:15,480 Speaker 1: make goods more abundant. You might destroy someone's ability to 843 00:49:15,560 --> 00:49:18,399 Speaker 1: buy a good, but the real way to make goods 844 00:49:18,480 --> 00:49:22,040 Speaker 1: cheaper is greater abundance. I say that to them, bring 845 00:49:22,160 --> 00:49:26,120 Speaker 1: up the point of well, the consequence of raising interest 846 00:49:26,200 --> 00:49:28,000 Speaker 1: rates and let's talk about a real example of the 847 00:49:28,040 --> 00:49:31,480 Speaker 1: Federal Reserve of increasing interest rates aggressively in twenty twenty two, 848 00:49:33,040 --> 00:49:36,400 Speaker 1: and here we're sitting in twenty twenty five, that the 849 00:49:36,480 --> 00:49:40,759 Speaker 1: other side of increasing interest rates is the value of 850 00:49:40,840 --> 00:49:47,120 Speaker 1: the underlying bonds declining in value, and that the past 851 00:49:47,280 --> 00:49:53,520 Speaker 1: regime was low interest rates manipulated lower for a long 852 00:49:53,640 --> 00:49:58,120 Speaker 1: period of time, and it trained this entire class of 853 00:49:58,280 --> 00:50:03,440 Speaker 1: investor to say, well, the Fed's gonna print money to 854 00:50:03,520 --> 00:50:06,000 Speaker 1: get these bonds to zero. So even if it doesn't 855 00:50:06,000 --> 00:50:09,280 Speaker 1: make sense to lend government or money to the government 856 00:50:09,960 --> 00:50:12,200 Speaker 1: for a long period of time, say ten years, twenty years, 857 00:50:12,280 --> 00:50:14,560 Speaker 1: or thirty years at this arbitrary low rate, I'm going 858 00:50:14,640 --> 00:50:16,239 Speaker 1: to do it anyways, because they're going to have to 859 00:50:16,320 --> 00:50:19,759 Speaker 1: buy these assets to force the interest rates lower. Well 860 00:50:19,840 --> 00:50:24,440 Speaker 1: by keeping interest rates higher for longer periods of time. 861 00:50:24,800 --> 00:50:27,200 Speaker 1: There was massive amount of holders of those bonds that 862 00:50:27,320 --> 00:50:31,040 Speaker 1: got burned, that lost money doing the quote safe thing, 863 00:50:33,080 --> 00:50:36,879 Speaker 1: and it's a fool me once. Shape on you, fool 864 00:50:36,920 --> 00:50:41,160 Speaker 1: me twice, Shame on me. The market has learned that 865 00:50:41,360 --> 00:50:45,640 Speaker 1: they cannot bet on the fact that the Fed's going 866 00:50:45,680 --> 00:50:47,040 Speaker 1: to even if the FED is going to have to 867 00:50:47,080 --> 00:50:49,839 Speaker 1: print money, the time duration matters, and they've lost They've 868 00:50:49,880 --> 00:50:53,360 Speaker 1: gotten burned. So it's you're not going to fool me again, 869 00:50:54,000 --> 00:50:57,520 Speaker 1: and that when the FED starts to lower interest rates 870 00:50:57,560 --> 00:51:01,840 Speaker 1: by printing money, or the the Bank of England or 871 00:51:02,680 --> 00:51:07,800 Speaker 1: the European Central Bank, the holders of those assets like, 872 00:51:09,440 --> 00:51:13,000 Speaker 1: why would I do this again? You know you've already 873 00:51:13,480 --> 00:51:18,800 Speaker 1: tried to quote reduce inflation by starving the market. I 874 00:51:19,520 --> 00:51:21,840 Speaker 1: got burned by that. So even if you try to 875 00:51:21,880 --> 00:51:25,440 Speaker 1: force interest rates lower, I'm not buying your paper. You're 876 00:51:25,480 --> 00:51:28,920 Speaker 1: going to have to buy your paper. And so that's 877 00:51:28,960 --> 00:51:33,480 Speaker 1: the regime change. That the market has gotten burned, and 878 00:51:33,719 --> 00:51:37,640 Speaker 1: they're not going to be quick to become the boil 879 00:51:37,719 --> 00:51:41,120 Speaker 1: and frog again to become the bag holder. So that 880 00:51:42,239 --> 00:51:44,920 Speaker 1: it seems like, and not in terms of a truly 881 00:51:45,120 --> 00:51:51,520 Speaker 1: dislocated way, but that central banks have lost control that 882 00:51:51,719 --> 00:51:54,839 Speaker 1: the market is the true set ceenter of interest rate. 883 00:51:55,800 --> 00:51:58,680 Speaker 1: The what the consequence is that central banks are going 884 00:51:58,760 --> 00:52:02,319 Speaker 1: to have to be more aggressive in buying their own debt. 885 00:52:02,880 --> 00:52:04,319 Speaker 1: The only way that they can do that is by 886 00:52:04,360 --> 00:52:08,480 Speaker 1: printing more money. Then operation by which central banks buy 887 00:52:08,800 --> 00:52:11,600 Speaker 1: the debt of the government is creating more supply of 888 00:52:11,640 --> 00:52:15,080 Speaker 1: the base money, increasing that six seven trillion to eight trillion, 889 00:52:15,200 --> 00:52:16,240 Speaker 1: nine trillion, ten trillion. 890 00:52:16,760 --> 00:52:19,239 Speaker 2: That's then Alden's nothing stops this train. 891 00:52:19,400 --> 00:52:23,760 Speaker 1: Yeah, And the truth thing that that dictates that nothing 892 00:52:24,040 --> 00:52:27,400 Speaker 1: stops to train is the relationship between the debt and 893 00:52:27,480 --> 00:52:31,000 Speaker 1: the system to the actual number of base dollars or 894 00:52:31,080 --> 00:52:36,120 Speaker 1: euros or yen. And at the level just below that 895 00:52:36,440 --> 00:52:39,000 Speaker 1: is that if you have a form of money that 896 00:52:39,200 --> 00:52:42,920 Speaker 1: is built foundationally with the idea that it can be 897 00:52:43,400 --> 00:52:47,040 Speaker 1: created by a central issuer at no cost, that the 898 00:52:47,120 --> 00:52:50,360 Speaker 1: market's going to figure that out and opt in to 899 00:52:52,200 --> 00:52:54,879 Speaker 1: a different form of money that has a different set 900 00:52:54,920 --> 00:52:56,360 Speaker 1: of rules, being bitcoin. 901 00:52:56,800 --> 00:52:58,920 Speaker 2: All Right, So we've talked about the inevitability system and 902 00:52:59,000 --> 00:53:01,640 Speaker 2: where this is all going, and one part I didn't 903 00:53:01,640 --> 00:53:03,000 Speaker 2: really want to I didn't get a chance to hit 904 00:53:03,040 --> 00:53:05,960 Speaker 2: on is you talked about the volatility of bitcoin and 905 00:53:06,040 --> 00:53:08,960 Speaker 2: starting to think about how we're allocating to it. So 906 00:53:09,040 --> 00:53:11,040 Speaker 2: we see the inevitability. You've built that up nicely for 907 00:53:11,160 --> 00:53:14,800 Speaker 2: us and using maybe some dollars and bitcoin. But I 908 00:53:14,880 --> 00:53:17,040 Speaker 2: know you have a company's app, right and you're pioneering 909 00:53:17,080 --> 00:53:20,439 Speaker 2: bitcoin payments, and so I'm just curious what you see 910 00:53:20,520 --> 00:53:22,239 Speaker 2: from that regard. You know, I see this as like 911 00:53:22,280 --> 00:53:24,879 Speaker 2: this evolutionary path. I know you're sort of bringing that forward. 912 00:53:25,200 --> 00:53:27,320 Speaker 2: What have you seen since you've been working on payments? 913 00:53:27,400 --> 00:53:29,120 Speaker 2: How has the adoption of that been going? 914 00:53:30,000 --> 00:53:33,200 Speaker 1: Well? I think one thing because we talked about this previously, 915 00:53:33,239 --> 00:53:37,360 Speaker 1: but then connecting it with this idea of why central 916 00:53:37,400 --> 00:53:38,920 Speaker 1: banks are going to have to create more money and 917 00:53:39,400 --> 00:53:42,759 Speaker 1: this trade off of short term volatility versus long term 918 00:53:42,880 --> 00:53:46,880 Speaker 1: destruction of value. Those are those two things coexist with 919 00:53:46,960 --> 00:53:49,680 Speaker 1: each other and everyone within the system has to solve it. 920 00:53:50,320 --> 00:53:53,880 Speaker 1: So a lot of people naturally look at bitcoin's volatility 921 00:53:53,920 --> 00:53:56,720 Speaker 1: and say, well, how could anybody ever accept it as payment? 922 00:53:56,760 --> 00:54:01,600 Speaker 1: And it's a very logical dilemma. I'm looking at the 923 00:54:01,640 --> 00:54:05,759 Speaker 1: surface level, but in reality, it's the same dilemma of 924 00:54:05,840 --> 00:54:11,279 Speaker 1: buying bitcoin for dollars as accepting it for payment. That 925 00:54:12,400 --> 00:54:14,319 Speaker 1: if you think about, you know, one of the strategies 926 00:54:14,440 --> 00:54:17,759 Speaker 1: that people employing bitcoin is dollar cost averaging, buying a 927 00:54:17,840 --> 00:54:21,959 Speaker 1: small amount every day or every week, and they're taking 928 00:54:22,000 --> 00:54:25,200 Speaker 1: a different price. You know, they're buying one hundred dollars 929 00:54:25,360 --> 00:54:28,000 Speaker 1: and the price of bitcoins x one day and lower 930 00:54:28,080 --> 00:54:30,239 Speaker 1: the next day, and higher the next day, and getting 931 00:54:30,239 --> 00:54:32,720 Speaker 1: a little bit more bitcoin one day and less bitcoin. 932 00:54:33,280 --> 00:54:38,280 Speaker 1: That if somebody has figured out why, yes bitcoin is volatile, 933 00:54:38,320 --> 00:54:40,680 Speaker 1: but why it stores value over time, that it's money 934 00:54:40,719 --> 00:54:43,840 Speaker 1: that can't be printed. That and they have a business 935 00:54:44,680 --> 00:54:48,319 Speaker 1: that they realize the end game and they say, well, 936 00:54:48,640 --> 00:54:51,480 Speaker 1: if I start selling my goods and services for bitcoin, yes, 937 00:54:51,560 --> 00:54:53,560 Speaker 1: the price is different. I'm you know, day to day, 938 00:54:53,560 --> 00:54:57,000 Speaker 1: and I'm gonna still be pricing goods in or services 939 00:54:57,160 --> 00:55:00,640 Speaker 1: in some dollar denomination, or if you're in Europe, you're denomination. 940 00:55:02,680 --> 00:55:05,680 Speaker 1: But it's the same as dollar cost averaging. Because when 941 00:55:05,719 --> 00:55:07,880 Speaker 1: they turn on the ability to be paid in bitcoin, 942 00:55:08,080 --> 00:55:10,640 Speaker 1: one hundred percent of their sales do not magically turn 943 00:55:10,760 --> 00:55:13,440 Speaker 1: up in bitcoin. It might be one percent to two 944 00:55:13,520 --> 00:55:16,600 Speaker 1: percent to five percent to ten percent. And say that 945 00:55:16,719 --> 00:55:18,800 Speaker 1: a business was doing ninety percent of their sales and 946 00:55:18,840 --> 00:55:21,400 Speaker 1: fiat and ten percent and bitcoin, well, they were going 947 00:55:21,480 --> 00:55:23,879 Speaker 1: to have to convert that ten percent of fiat into 948 00:55:23,880 --> 00:55:26,600 Speaker 1: bitcoin because they wanted to save in bitcoin anyway. And 949 00:55:27,160 --> 00:55:31,360 Speaker 1: so it it just is a different means to actually 950 00:55:31,400 --> 00:55:33,520 Speaker 1: acquire the bitcoin, but in a way that de risks 951 00:55:33,560 --> 00:55:36,560 Speaker 1: the business at the same time that is able to say, well, 952 00:55:36,840 --> 00:55:38,279 Speaker 1: I can still be paid in dollars and I have 953 00:55:38,360 --> 00:55:40,200 Speaker 1: my dollar rails, but now I have this new rail 954 00:55:40,600 --> 00:55:45,000 Speaker 1: that creates redundancy and allows me to market my services, 955 00:55:45,440 --> 00:55:48,480 Speaker 1: to appeal to people that have bitcoin, and to actually 956 00:55:48,520 --> 00:55:50,399 Speaker 1: make the transaction more efficient if people want to pay 957 00:55:50,440 --> 00:55:53,480 Speaker 1: me in that way. And so we're still early to 958 00:55:53,520 --> 00:55:55,400 Speaker 1: bitcoin payments. So like the way I think about it 959 00:55:55,560 --> 00:55:57,840 Speaker 1: is we're early to bitcoin, which means that we're earlier 960 00:55:57,880 --> 00:56:02,880 Speaker 1: to bitcoin payments because somebody does necessarily need to understand 961 00:56:03,000 --> 00:56:05,560 Speaker 1: something fundamental about bitcoin, like I do not think, as 962 00:56:05,600 --> 00:56:09,000 Speaker 1: an example, that somebody that does not know why bitcoin 963 00:56:09,160 --> 00:56:14,000 Speaker 1: stores value even while being volatile, should endeavor to accept 964 00:56:14,040 --> 00:56:17,800 Speaker 1: bitcoin payments. It's a it's a reverse order of operation. 965 00:56:17,920 --> 00:56:20,960 Speaker 1: It's the wrong it's decidedly the wrong order. But if 966 00:56:21,000 --> 00:56:25,040 Speaker 1: everyone is on this curve of understanding bitcoin understanding the 967 00:56:25,160 --> 00:56:28,800 Speaker 1: problem that it solves that the people that were earlier 968 00:56:28,840 --> 00:56:33,160 Speaker 1: to understand bitcoin are increasingly asking to be paid in bitcoin. 969 00:56:33,320 --> 00:56:35,920 Speaker 1: So we're seeing growing trends. Is you know, there's a 970 00:56:35,960 --> 00:56:40,080 Speaker 1: recognition that it's early to the ballgame, but somebody has 971 00:56:40,120 --> 00:56:43,920 Speaker 1: to be early, and that the amount of adoption that 972 00:56:43,960 --> 00:56:48,080 Speaker 1: we're seeing feels like, you know, we're you know, an 973 00:56:48,120 --> 00:56:50,960 Speaker 1: inflection point. Doesn't mean the majority of the world in 974 00:56:51,000 --> 00:56:55,400 Speaker 1: a year or two not just accepting bitcoin, but but 975 00:56:55,600 --> 00:56:57,920 Speaker 1: doing more than fifty percent of their sales, but that 976 00:56:58,040 --> 00:57:02,800 Speaker 1: there's a critical mass that's more that it's going to 977 00:57:02,920 --> 00:57:07,400 Speaker 1: materially accelerate Companies like Square turning on the bitcoin payments, 978 00:57:07,440 --> 00:57:10,640 Speaker 1: in my mind, is a watershed moment for everybody working 979 00:57:10,680 --> 00:57:14,200 Speaker 1: on bitcoin payments, but also for everyone out there that's 980 00:57:14,239 --> 00:57:18,120 Speaker 1: providing a payment service that doesn't have bitcoin incorporated, because 981 00:57:18,960 --> 00:57:22,200 Speaker 1: it becomes a differentiation. Yeah, for any platform. 982 00:57:22,440 --> 00:57:24,320 Speaker 2: And we've seen the I mean the best case was 983 00:57:24,440 --> 00:57:26,560 Speaker 2: at the Bitcoin conference like two months ago Steak and 984 00:57:26,600 --> 00:57:28,560 Speaker 2: Shake and Now so they were going to start accepting bitcoin. 985 00:57:29,000 --> 00:57:31,760 Speaker 2: And I think it was the president maybe of Stake 986 00:57:31,800 --> 00:57:33,640 Speaker 2: and Shake got up and gave a talk and he 987 00:57:33,800 --> 00:57:35,600 Speaker 2: gave some numbers out I forget what it was, but 988 00:57:35,680 --> 00:57:38,480 Speaker 2: they increase like per store visits like fifty percent or 989 00:57:38,560 --> 00:57:40,960 Speaker 2: some crazy number. You may know that, but I mean 990 00:57:41,000 --> 00:57:42,960 Speaker 2: you could see that first move or advantage where all 991 00:57:42,960 --> 00:57:44,840 Speaker 2: of a sudden people wanted to go spend the bitcoin. 992 00:57:44,920 --> 00:57:47,320 Speaker 2: And of course, as the wealth of bitcoin continues to grow, 993 00:57:47,320 --> 00:57:48,400 Speaker 2: people are going to want to spend it. 994 00:57:48,600 --> 00:57:51,400 Speaker 1: So yeah, and you know someone might say, well, why 995 00:57:51,400 --> 00:57:55,640 Speaker 1: would somebody spend bitcoin? You know if it's values going 996 00:57:55,720 --> 00:57:59,480 Speaker 1: up so much, And it's not really a spending bitcoin, 997 00:58:00,560 --> 00:58:03,560 Speaker 1: it's a spending for savings because if you were going 998 00:58:03,640 --> 00:58:06,720 Speaker 1: to spend your dollars, you could have decided not to 999 00:58:06,840 --> 00:58:08,600 Speaker 1: consume and to buy the bitcoin. 1000 00:58:10,000 --> 00:58:10,320 Speaker 2: And so. 1001 00:58:12,000 --> 00:58:14,560 Speaker 1: Yeah, and so you know, for a lot of people 1002 00:58:14,640 --> 00:58:17,000 Speaker 1: that have owned bitcoin for a long time the vast 1003 00:58:17,080 --> 00:58:19,960 Speaker 1: majority of their savings are in bitcoin. Now that that 1004 00:58:20,160 --> 00:58:23,080 Speaker 1: is again a small percentage of the population, but for 1005 00:58:23,200 --> 00:58:26,320 Speaker 1: those people, spending bitcoin is actually easier than converting back 1006 00:58:26,320 --> 00:58:31,160 Speaker 1: into dollars and spending dollars. And if there's more people 1007 00:58:31,200 --> 00:58:34,240 Speaker 1: adopting bitcoin, there's more people holding bitcoin, and there's more 1008 00:58:34,320 --> 00:58:37,480 Speaker 1: merchants that want to accept it. And it's just this 1009 00:58:37,760 --> 00:58:41,280 Speaker 1: organic process of growth, and there will be accelerations of 1010 00:58:41,360 --> 00:58:46,320 Speaker 1: it and decelerations and accelerations again, but it ultimately needs 1011 00:58:46,440 --> 00:58:50,280 Speaker 1: to exist for bitcoin to work long term, and that 1012 00:58:50,960 --> 00:58:53,520 Speaker 1: when I look out into the future, I think this 1013 00:58:53,680 --> 00:58:58,360 Speaker 1: shift to bitcoin happens a lot faster than people think, 1014 00:58:58,760 --> 00:59:00,840 Speaker 1: and we're seeing the amount of blumes of people being 1015 00:59:00,920 --> 00:59:06,760 Speaker 1: interested in it, and the trend will only accelerate, and 1016 00:59:06,880 --> 00:59:10,440 Speaker 1: the bitcoin payments might be a small segment of the economy, 1017 00:59:10,640 --> 00:59:13,160 Speaker 1: but it becomes a massive differentiator for platforms that have 1018 00:59:13,320 --> 00:59:16,920 Speaker 1: it versus those that don't. And what's becoming clear with 1019 00:59:17,000 --> 00:59:20,400 Speaker 1: an example of Stake and Shake is that bitcoin is 1020 00:59:20,560 --> 00:59:23,720 Speaker 1: large enough that you can either service one hundred percent 1021 00:59:24,800 --> 00:59:27,920 Speaker 1: of the of the economy, the fiat economy and the 1022 00:59:27,920 --> 00:59:31,160 Speaker 1: bitcoin ecomy, or you can you can service a subset 1023 00:59:31,160 --> 00:59:32,840 Speaker 1: of it, and it still might be the majority of it, 1024 00:59:33,280 --> 00:59:39,040 Speaker 1: but you risk being at a disadvantage to one of 1025 00:59:39,120 --> 00:59:41,800 Speaker 1: your competitors that does accept it, and that will be 1026 00:59:41,880 --> 00:59:45,520 Speaker 1: a force that also drives acceleration. That bitcoin sales might 1027 00:59:45,600 --> 00:59:47,720 Speaker 1: be one percent or two percent or five percent, but 1028 00:59:47,800 --> 00:59:50,720 Speaker 1: if you don't have it, a large share of the economy, 1029 00:59:50,800 --> 00:59:53,560 Speaker 1: even if it's still small on a percentage basis, is 1030 00:59:53,640 --> 00:59:54,720 Speaker 1: going to shift somewhere else. 1031 00:59:54,840 --> 00:59:58,800 Speaker 2: Yeah. Yeah, I love that. I love what you just 1032 00:59:58,840 --> 01:00:01,080 Speaker 2: said there because the reframed my brain. It's not a 1033 01:00:01,200 --> 01:00:05,400 Speaker 2: spending bitcoin. It's a spending question or thought right where 1034 01:00:05,440 --> 01:00:08,520 Speaker 2: it's like I'm gonna spend dollars, but those dollars good 1035 01:00:08,520 --> 01:00:11,120 Speaker 2: about bitcoin. Yeah, so it's really a spending problem and 1036 01:00:11,120 --> 01:00:12,760 Speaker 2: I hadn't really thought about that. That's a good reframe. 1037 01:00:13,000 --> 01:00:15,040 Speaker 1: Yeah, And there's a there's a thing that Jack Mallers 1038 01:00:15,120 --> 01:00:17,280 Speaker 1: talked about on the podcast that I think is is 1039 01:00:17,360 --> 01:00:20,160 Speaker 1: really right that like, when you hold very few dollars, 1040 01:00:21,160 --> 01:00:23,400 Speaker 1: you think about it as an opportunity cost some bitcoin, 1041 01:00:24,440 --> 01:00:27,040 Speaker 1: and when you hold a lot of dollars, it's like 1042 01:00:27,240 --> 01:00:29,280 Speaker 1: I'll go I'll go spend on, I'll go spend my 1043 01:00:29,360 --> 01:00:32,200 Speaker 1: dollars on anything because because they're loser value, and so 1044 01:00:32,400 --> 01:00:35,560 Speaker 1: it does as a as a consumption model, it shifts 1045 01:00:35,600 --> 01:00:37,960 Speaker 1: your framing of do I really need this? Am I 1046 01:00:38,040 --> 01:00:41,200 Speaker 1: willing to spend my bitcoin on this? And there's a 1047 01:00:41,240 --> 01:00:43,760 Speaker 1: lot of cases in my life just because you know, 1048 01:00:44,040 --> 01:00:46,160 Speaker 1: I move the vast majority of all my savings are 1049 01:00:46,240 --> 01:00:49,400 Speaker 1: in bitcoin, where it's a no brainer, I need this. 1050 01:00:50,320 --> 01:00:52,400 Speaker 1: I need to get the transmission of my car fixed, 1051 01:00:52,720 --> 01:00:56,960 Speaker 1: I need to spend this vacation money for my for 1052 01:00:57,120 --> 01:00:59,840 Speaker 1: my family. And then there's other things where I'm like, 1053 01:00:59,840 --> 01:01:00,560 Speaker 1: do I really need that? 1054 01:01:00,880 --> 01:01:01,040 Speaker 2: Yeah? 1055 01:01:01,160 --> 01:01:02,800 Speaker 1: Do I need to go spend five hundred dollars on 1056 01:01:02,880 --> 01:01:03,240 Speaker 1: that dinner? 1057 01:01:03,440 --> 01:01:03,640 Speaker 2: Yeah? 1058 01:01:03,800 --> 01:01:06,000 Speaker 1: Or can I cook steaks at home and enjoy and 1059 01:01:07,000 --> 01:01:09,280 Speaker 1: and enjoy the dinner more? Yeah, not just because I'm 1060 01:01:09,280 --> 01:01:12,680 Speaker 1: saving because yeah, I'm at home with my family rather 1061 01:01:12,800 --> 01:01:18,720 Speaker 1: than you know, so it does. It makes you essentially 1062 01:01:19,000 --> 01:01:22,120 Speaker 1: a better consumer the more bitcoin that you have in 1063 01:01:22,240 --> 01:01:22,880 Speaker 1: less fiat. 1064 01:01:22,720 --> 01:01:26,960 Speaker 2: Because better capital alligator. Yeah yeah, yeah cool. Let's wrap 1065 01:01:27,000 --> 01:01:28,720 Speaker 2: it up with that, Parker, as anything else that people 1066 01:01:28,720 --> 01:01:29,919 Speaker 2: should be fans in to do. I think you wrote 1067 01:01:30,040 --> 01:01:33,080 Speaker 2: a new piece recently, right, bick one can't be copied, No. 1068 01:01:33,280 --> 01:01:35,680 Speaker 1: Someone just recirculated that that was that was an older one. 1069 01:01:35,720 --> 01:01:41,000 Speaker 1: But my blog, I you know, I do write less. 1070 01:01:41,040 --> 01:01:43,440 Speaker 1: It's kind of like feeling that I only want to 1071 01:01:43,480 --> 01:01:45,919 Speaker 1: write when I have something that needs to be said. 1072 01:01:45,960 --> 01:01:47,920 Speaker 1: But I do post kind of from time to time 1073 01:01:48,200 --> 01:01:50,800 Speaker 1: on my blog. So gradually, then suddenly dot x y 1074 01:01:50,920 --> 01:01:54,320 Speaker 1: Z my book which is on Safety's web how website 1075 01:01:54,520 --> 01:01:57,200 Speaker 1: the safe house spelled s A I F so the 1076 01:01:57,320 --> 01:01:59,840 Speaker 1: safeouse dot com. They can get my book gradually than suddenly. 1077 01:02:00,280 --> 01:02:01,960 Speaker 1: And again I say, if you know, if you don't, 1078 01:02:02,120 --> 01:02:04,080 Speaker 1: you know, people shouldn't just jump to bitcoin payments. So 1079 01:02:04,120 --> 01:02:07,439 Speaker 1: they're still exploring why is it? Why are people saying 1080 01:02:07,520 --> 01:02:10,680 Speaker 1: this thing bitcoin's money? Why is it sore value? Read 1081 01:02:10,720 --> 01:02:12,720 Speaker 1: a book? You know, there's there's a number of other 1082 01:02:12,760 --> 01:02:17,160 Speaker 1: great books linn Alden's books on the safe House, Safety's books, 1083 01:02:17,240 --> 01:02:19,280 Speaker 1: But you can get my book there graduate and suddenly, 1084 01:02:19,360 --> 01:02:21,880 Speaker 1: so there would be where I point people. And if 1085 01:02:21,920 --> 01:02:24,760 Speaker 1: you're further down that path you understand why bitcoin store 1086 01:02:24,800 --> 01:02:27,720 Speaker 1: is value. You are a business owner, you should I 1087 01:02:27,760 --> 01:02:32,040 Speaker 1: would urge people who grock it to realize that accepting 1088 01:02:32,080 --> 01:02:34,080 Speaker 1: bitcoin is just a more efficient way to acquire it, 1089 01:02:34,480 --> 01:02:36,960 Speaker 1: and it eliminates risks for your business at the same 1090 01:02:37,000 --> 01:02:39,360 Speaker 1: time that if you're one of those people, check out 1091 01:02:39,360 --> 01:02:42,120 Speaker 1: our website zappright dot com. If you reach out to us, 1092 01:02:42,160 --> 01:02:45,000 Speaker 1: I'll likely be the person that's helping serve you day 1093 01:02:45,040 --> 01:02:45,280 Speaker 1: to day. 1094 01:02:45,400 --> 01:02:49,960 Speaker 2: So learn about it you know, inquire about it perfect. 1095 01:02:50,440 --> 01:02:51,440 Speaker 2: Thanks scraping Up