Bitcoin Update 30 Mar 2024! Transcript

Introduction to Crypto Big Chatty Forehead Talk Fest

[0:00] Good afternoon, everybody. Welcome to Crypto Big Chatty Forehead Talk Fest.
We're still working on the marketing for all of this.
But what are the top 10 inventions that have changed the world?
Top 10 inventions that have changed the world. This is from one of the most
popular engineering accounts on X.
Waterwell's steam engine. Give me steam. Same.
What else? Steam Engine. What else? Come on. What do you got?
Internet. Yeah. Radio. Radio.
Kill video killed the radio star. Yes, that's right. Very first video ever played on MTV.
Actually, it's a great song. It's a really great song.
Internet, radio, Steam Engine. What else? What else have you got?
What else have you got? Bitcoin and Dogecoin.
Meme coin.

[1:00] Last top at 69k felt topish but now when hovering around 70.

[1:05] Feels really cheap yeah it's funny this is I mean this is an addiction right
and an addiction is any time you need to escalate to get,
the same right so if bitcoin what did it go from like 20 I'm talking Canadian
dollars went like from 22 2 to 98, right?
And, and rather than saying, my God, that's four times or more.
Oh, it's the greatest thing ever. You're like, why isn't it at a hundred?
Right? So that's, that's how you go. You got to battle that.
And, uh, any, any time you get frustrated with Bitcoin, it's just one,
one simple thing you need to do.
It's one simple thing you need to do. Anytime you ever get annoyed or frustrated
or feel the Bitcoin is stagnant, just zoom out.
You know you can go to wherever like just
zoom out zoom out five years zoom out 10 years zoom out 14 years and you'll
feel fantastic so yeah if if you if you zoom in it's annoying if you zoom out
it's like hallelujah right so the bow computers the printing press uh containers i don't know,
lots of recency bias with the interventions
bow electricity light bulb all right three phase ac DC power.

Top 10 Inventions That Changed the World

All right. So this is what is said. Again, this is one of the biggest engineering.
I don't know where they get their data from.
Obviously, I don't know. I don't know. But.

[2:30] And of course, tips are tips are welcome. So this is the top 10 inventions that
changed the world. One, the wheel.

[2:38] Two, the nail. Three, the compass.
And it's funny because the age of discovery has passed, so we don't think of
the value of the compass, but without the compass, there really wasn't the age of discovery.
Four, electricity, or as my daughter said when she was a toddler, electricity.
Five, the internal combustion engine, also known as my bowels post-Indian food.
6 the telephone 7 the light bulb 8 penicillin 9 contraceptives maybe related
to nailing I'm not sure and 10 the internet now I would obviously,
put in bitcoin though it's early days I would add the printing press but because
so they're looking for technology not literacy because they are,
engineers but this is the this is the argument sextant also related to penicillin
contraceptives and nailing,
Yes, I would put a couple of other things in there, but that's what they got.
And I thought it was an interesting start. All right.

Internet Users' Ownership of Crypto

So let's just dive straight into the data. All right. What percentage of Internet users own crypto?
What percentage of Internet users own crypto?
We know 1% of the world. What percentage of Internet users own crypto?
Not Bitcoin, just crypto as a whole.

[4:00] So, 2%?
It's 4% of internet users own crypto. Very early days. Very early days. All right.
So, Bitwise CEO says, quote, a major national U.S. wealth platform selected
and approved advisor access, end quote, to their spot Bitcoin ETF this week.
So, what does this mean? well
it means that financial advisors
can now discuss bitcoin etfs with their clients
so i don't know if you've ever
worked in the finance industry i did
as a programmer on a one of
canada's largest trading platforms and all
that and of course i've gone through a
fair amount of brutal financial education um buying
so selling a variety of companies that i co-founded or a company multiple times
and all of that so it means so a lot of times there's a barrier you can't discuss
x y and z until it's approved by the the central borg right and so now now.

[5:15] Financial advisors are now officially allowed to discuss bitcoin etfs with their
clients heads. So that's interesting.
The US Treasury has issued $7 trillion worth of debt in just three months.
$7 trillion worth of debt in just three months. That means about a third of
the US debt has been papered in the last three months.
That's wild. Now that is actually a level of debt issuance that matches the
worst of COVID, but there's no pandemic.
And it's double the previous record that had stood for 231 years.

[5:54] The economy, the entire U.S. economy, not just the U.S.
Economy, but the economy of late-stage fiat currency environments is,
I don't know if you've ever been hot air ballooning, but I'll give you an example.
There we go, hot air ballooning. The visual joke.
A visual joke. So, hot air ballooning, you've got to keep the heat, right?
You've got to keep the heat because hot air rises. So you got to keep the heat
and there's a massive crank.
There's a massive crank of heat that is required to keep the hot air balloon
up in the air and the cold of the air, the more heat you need. Right.

[6:36] So the economy is kind of held aloft with the, you know, money printer go kind of thing.
Right. Right. And so when you look at the economy and how much debt is required
to keep it in a mild growth scenario,
we are in the late stages of the addiction.
Right. You understand that when you need more stimulus to achieve the same outcome,
then you are in a situation of addiction.
Right which is why it's important to be happy that
crypto's up and not look at oh it hasn't gone
up much today right and and so or bitcoin
so the u.s economy
is more than the economies of the west as a whole are held aloft by money printing
and the money printing is escalating but there's not a concomitant increase
in economic productivity,
in economic wealth, in economic value.
So when you have to crank up the debt, but the needle of the economic growth
doesn't budge much, then you are in a challenging situation, to put it mildly.
And of course, you know, this is happening because they want to create the illusion
economy or the economy of, the illusion of a robust economy through the election.

[8:00] So that's pretty wild. And I had some more data on that, right?
So this is from, I just want to make sure I get the right date in here.
I think this was the day I do.
March 26th, so a couple of days ago.

[8:19] So this is wild stuff. U.S. federal debt totaled $26.2 trillion at the end of
2023, about 97% of gross domestic product. product.
The non-partisan independent agency CBO expects the debt to GDP ratio to rise
past the second world war high of 116% by 2029 and reach as high as 166% by 2054.
Seems a bit optimistic, but that's what they say.

[8:46] The bigger the debt, the greater the pressure to keep real or inflation-adjusted
interest rates and bond yields artificially low.
Higher rates and higher debt levels push the government's interest expenses,
higher aggravating debt concerns, right?
So this is the challenge, right? So if we had some sort of magical way that
every time additional dollars were added to a relatively stagnant economy,
that the price increases would be immediate, right?
The price increases would be immediate, then there would be no point printing money.

Economic Impact of Money Printing

But because the price interests are delayed, the people who get the money first
get to spend the money at greater value than those who receive it later,
who get to spend it at much less value.
So if you're handed the first million dollars that's been printed,
you get to spend it at full value.
And then the people who get, like the million people who get the last dollar
out of that get to spend it at 50% of their value.
So it really is just stealing from the poor. It's just, it's brutal.

[9:45] So you've got to keep these interest rates low and real interest rates and the
bond yields have to be kept low otherwise you don't get to profit from all of that right,
so negative real rates often lead investors to move money out of fixed income
investments and into high risk high return assets like technology stocks cryptocurrencies
and havens like gold And of course, we saw that in 2020 to 2021.
So if inflation is running at 8% and yet you're only getting 4% return on your
fixed income investments, then you've got to move your money out because you're going to lose it.
Like the US dollar has lost almost a quarter of its value just since 2020.

[10:30] That's, I mean, staggeringly brutal, right? I mean, if you saved a million dollars
and you put it in the bank, you've lost a quarter of a million dollars in less
than half a decade. That's rough.

[10:44] Now, of course, U.S. bonds, U.S. treasuries are traded around the world as if they're cash, right?
And if there's any doubt about the long-term viability of these,
there's going to be a significant readjustment.
And people are going to be looking for other investments.
You know, the safe haven is sort of the phrase, right? So if you're out there
on the ocean and the weather is great, you're not going to put into a sketchy port, right?
Some port where, you know, your sailors will go and visit houses of ill repute
and possibly get syphilis, go insane and crash your ship. Right.
So it's some sketchy port where they might let you take on new provisions,
but they also might rob you of half your goods. Right. So it's a really sketchy port.
So you're like, we've got to sail past the sketchy port and keep going because
it's smooth sailing, glass, good wind and all of that glass sees good wind.
But of course if a massive storm is is
coming then you're going to go into the safe haven right
even though it's kind of sketchy it's safer than being out on the water so bitcoin
for a lot of investors is that sketchy port uh but as long as they can sail
past it they will but if there's a big storm coming in there's a possibility
i know this is an analogy an analogy is not proof but that's That's the general
mindset that I've sort of seen.

Bitcoin ETF Approval Impact

[12:09] This is from the newsletter service London Crypto Club.
It said, in a highly indebted economy, negative real inflation-adjusted rates
and financial repression are a necessary condition to keep the system running,
and fiat currency debasement remains the escape valve.
I don't want to get out, right? him.
So, the founder said gold continues to signal that the macro sands are shifting.
Should net ETF inflows turn positive this week, don't be surprised if Bitcoin
catches the macro winds and accelerates to new highs.
The Nasdaq listed spot ETFs accumulated of $15 million on Monday,
snapping a five-day streak of outflows.
Bitcoin changed hands ends at US$70,780 at press time, representing a 5% gain on a 24-hour basis.
The CoinDesk 20 Index, a measure of the broader crypto market,
added 5.5%. Again, this is from a couple of days ago.
All right, let me sort of get to some more data here. Yeah.

Demand for Bitcoin ETFs

[13:29] Uh, Larry Fink said on TV that demand for Bitcoin ETFs have been by retail.
This is because big whales have a 90 day trading delay that ends in the beginning of May.
April 2024 will therefore be the last month ever for normal people to become a whole coiner.
Use April well, he said, right?
So seems relevant. Again, you know, the usual standard caveat.
None of this is trading advice.
Don't make any buying or selling decisions based on anything that I'm saying.
I'm a rank amateur, not certified, blah, blah, blah, blah, blah.
This is all just my opinion, and it's all on you. Do your own research.
Make your own decisions. Don't do anything based upon what I'm saying.
Now, the Bankman-Fried situation is interesting, as you probably heard.
He got 25 years this week.
And, boy, just imagine. If he'd just been able to keep the scam going for six
more months, then his customers could have been made whole by this crypto rally.
Isn't that wild? Maybe he would have stolen all of that money too but he would
have probably been able to make his customers whole because he had an AI startup
bet that turned 500 million into 5 billion. That was a wild crypto rally.
So timing, timing, timing, timing, timing. timing.

[14:54] So, um, if Bitcoin hits 72,000, according to one researcher,
if Bitcoin hits 72,200, 1.2 billion worth of Bitcoin short positions will be flushed out.
So yeah, it's, uh, it's pretty wild.
Yeah. There was a YouTube fellow who went to, speaking of the sort of unsafe
Dave Bortz, there was a YouTube fellow who went there to interview the head
of the Haitian, whatever you'd call it these days.
And I think he's been kidnapped. They want 600,000.

[15:29] That's a, I don't know. I don't know why people do these dangerous things. It's a mystery to me.
Okay. Now, if Bitcoin reaches the gold market cap, right?
This is not any kind of prediction, obviously, but this is an interesting number.
If Bitcoin reaches the gold market cap, then Bitcoin's U.S.
Dollars will be worth almost $770,000 per Bitcoin. What's that close to a mil Canadian?
So yeah, if Bitcoin, obviously there's a long way to go,
but if Bitcoin reaches the gold market cap, which is roughly to say that if
people accept that Bitcoin is a store of value roughly equal to gold,
It's an inflation escape valve roughly equal to gold,
then we're talking $769,852 per Bitcoin if it reaches the gold market cap.

[16:27] So, there was a good quote here, they say, Bitcoin is the math class you never
had, the history class you never had, the finance class you never had,
the physics class you never had, and the economics class you never had.
And it's true, you know, normally studying economics is called the dismal science, right?
So normally studying economics is just depressing. It's really depressing.
But studying economics, if it's paid off for you in crypto, I guess it's been worth it, right?

[16:58] I guess it's been worth it. Available Bitcoin supply is shrinking at a super
rapid pace. Only 1.77 million left on exchanges.
Only 1.77 million left on exchanges. this is
a rough rule of thumb of course as you know that people take
off they take the bitcoins off exchanges if they
are putting them in cold storage or believe that the price is going to go up
or if they're just saying not that anybody really does this but you know mentally
they say i'll check in in 6 to 12 months and see what the price is but i'm not
going to trade right so if bitcoin is leaving the exchanges usually that's an
indication that people are thinking thinking it's going to go up.
And if Bitcoin is going on the exchanges, people may be more inclined,
or it may be a signal that they're more inclined to sell.

Value Perception and Bitcoin

And none of that changes the fundamental economic arguments for Bitcoin,
which don't exist independent of what people believe, right?
So a thing has value if people think it has value, right?
That's what I was talking about with the Austrian economics show I did a couple
of weeks ago, which you should really listen to.
It wasn't particular to Bitcoin and its movements at the time.
But But if people believe something has value, it has value.
But it doesn't have intrinsic value.
Like there's this thing called intrinsic that you can just attach to something
to determine whether people should value it or not.
Isn't that weird? Isn't that weird?

[18:20] It's Platonism, basically. So Platonism says that there's an essence to something
that exists independent of it and is somehow infused or attached to it, but exists prior to it.
It exists after it. Like the soul, right, so to speak. Oh, no,
the soul, I think, is created with the body.
So people have this belief that there's this thing called intrinsic value that
is somehow attached to something that raises its value.
But there is no such thing as intrinsic value. Oh, no, food has intrinsic value. Nope.
No. A lot of people, if they are, they'd rather feed their kids than themselves.
So the kids have higher value than their food.
There are people going on hunger strikes. Hunger strikes, there are people dieting
to whom food has negative value.
So, ah, but water, it's like, yeah, you know, I get that. I get that.
But the value of water is still only dependent upon you.
Yes, the show is 5434, Bitcoin versus Economists.
Steph, do you think the money printing this round is worse than COVID because
during COVID we didn't have all the refugees?
I mean, certainly the spending on this sort of situation is very high and will likely escalate.

[19:40] Yeah, whether the flood water has negative value, if you're already carrying
a lot of water and somebody offers you sell you more water that's heavy,
because all water is crazy heavy, and 600 times denser than air, if I remember rightly,
then you're not going to find it to be of value.
If you are an alcoholic, water doesn't have much value relative to beer and so on, right?
So, this idea that there's this thing that I can imagine, that I can mentally
attach to something to raise its value in the eyes of others, is funny.
I mean, it's funny to me. I mean virtue has value
right virtue has value I think
I mean I've made that sort of case virtue has value but I can't just
attach virtue to something and say it now has value and therefore
people are going to want it more like you willing the
price of something to rise because you're attaching imaginary thing called intrinsic
value to it it's just kind of funny to me and and it's just absolutely not true
absolutely not true respecting property rights has value not if you you want
other people's property and then it doesn't it's only if you want to keep your own.

[20:49] All right so i just wanted to sort
of mention that i think that's it like i've got a bunch of notes here but i
think that's it from the from the first one uh the ceo of bitcoin miner iren
explains why they liquidate all the bitcoin they mine and he said this is daniel
roberts he said investors shouldn't be paying for us to hold bitcoin on their
behalf if people want to own own Bitcoin, go and buy it and put it in cold storage.

[21:12] Because the people are saying, well, even the miners don't keep their Bitcoin.

[21:17] So, I mean, if they, if they wanted to, if, if you, I mean, if you're a miner
and you want to own Bitcoin, if you have a bunch of money, let's say,
I don't know, let's say it takes $5 million to start up a mining rig or mining organization.
You would just buy Bitcoin with those 5 million if you wanted to have Bitcoin.
So the fact that miners sell Bitcoin, I don't know, it's kind of funny, right?

Asset Classes by Market Capitalization

All right. Asset classes by market capitalization.
This is from Blockware Solutions. Real estate, $326 trillion.
Debt, $303 trillion. Equities, $108 trillion.
Base money, $30.4 trillion. Gold, $12 trillion. Bitcoin.
Teeny, teeny, meeny, 1.3. 1.3.

[22:11] So, real estate, just think of it this, right? Real estate, $326, Bitcoin, $1.30.

[22:18] $1.30, we used to use that when we'd talk about a really skinny guy.
Ah, it's $1.30, 130 pounds, right?
So, you've got some land whale, 326 pounds. Oh, no, that's even more. That's even more.
So, yeah, so $326 versus $1.30, right?
Gold is $12 versus Bitcoin's got $1.30. is
it impossible for money to flow out of
gold or these other things into bitcoin uh well sure so
real estate is taking a blow for a variety of reasons right commercial real
estate has taken a massive blow because of covid and working from home and all
of that and and people just saving money that way so demand for and people are
starting fewer companies these days because regulatory hurdles are just getting
higher and higher companies aren't growing as well because Because when you grow,
you hit all of these regulatory requirements and diversity and different kinds
of HR requirements and so on.
So companies aren't growing. And so they just don't need as much real estate.
And people are trying to find ways to decentralize. People are coordinating
work with people in other countries. So you don't need real estate.
So commercial real estate is kind of getting hollowed out.
And, of course, people still need places to live.
But there's much less flipping and growth these days in the real estate market.
Because people are saying this all over the place.
Well, if I sell my house, maybe I make some money, but I've got to buy some
other new house. It's crazy expensive.

[23:38] And there is kind of a shiver that's going through, uh, the West and in particular
in America at, uh, at the moment, which is, um, have you heard of these,
uh, the squatters thing right there?

[23:53] That there are places where there's a lot of expertise in how to take over someone's
house if it's not being lived in for a while. It could be some rental property
or maybe you're on an extended vacation.
You just move into somebody's house and there's a certain series of steps you
can take where it's virtually impossible to get you out.
And this is sort of a blowback or unintended effect of these squatters' rights things.

[24:19] So getting people out of your apartment, if they're not paying rent,
for instance, or if they've really trashed it and they've blown past their security
deposit, getting people out of your apartment, if you're a landlord, it's really tough.
There was actually an old Michael Keaton movie called Pacific Heights about
this was one of the very few pro property rights movies that has ever been made
by trying to get people out.
So of course the people who
rent are they vastly outnumber the people
who own right uh properties right so if you've got a um an apartment building
you own an apartment building with 40 apartments you know there's 80 to 100
people and you're just one guy so they're going to outvote you so the politicians
are going to respond to the tenants not the landlords and wasn't there an old
crappy happy police song about the landlord.

Real Estate Challenges and Squatters' Rights

And landlords are kind of hated. And so what happens is, if some,
let's say some woman, some single mom, it's kind of a typical scenario, some single mom.

[25:25] Doesn't pay her rent or is, I don't know, doing something illegal or,
you know, just not taking care of the place, maybe trashing the place a little,
having too many parties, then the landlord wants to get her out.
And so he cancels her lease, he cancels her rent, or he cancels her right of
occupancy, and then she becomes a squatter, and then he can call the sheriff's
department and say, here's a squatter, here's all the paperwork,
you've got to get the squatter out.
And then, of course, what happens is all of the sentimental people or the people
who are wanting to wreck the system, they come and they say,
oh, you know, there's a social media, you know, the sheriff comes and this woman,
and she's crying and the kids are crying and they're being dragged out of the
place and their stuff's on the lawn and everyone is like, oh no,
it's cold or it's terrible or it's bad or whatever.
And they say, well, we can't have that happen. Right? We can't have that happen.

[26:25] And so they pass these laws that say you can't evict squatters because declaring,
again, I'm no landlord. This is my understanding.
Of course, it could be wrong about all of this, but my understanding about how it works.
So if somebody is a squatter, it's really tough to evict them.
Is this what Joe says? If you live for 30 days in the house,
you can't get evicted. That's crazy.
And of course, it's completely mad, right? I mean, it's completely crazy.
But what's happening is the concerns that people have about leaving properties
unattended have gone up.
And of course, the Airbnb issues where Airbnbs aren't working out that much
because Airbnbs require a high trust society.
So Airbnbs aren't working out that much. And so the value of real estate might
be, I mean, I think it is going down in a lot of places.
So uh real estate values may
be declining i think they are in some places and so
it may not be the guarantee of you know the the money
printing right the the uh the central bank
prints a lot of money and then people think that their deed to their house is
also going to quote print a lot of money by raising the value of their house
and all of that and of course as economic conditions in the the west get worse
and worse and worse some of the people who might immigrate to the west.

[27:52] May not do so they may not choose to do that or they may choose to move back
if things get really bad and they seem to be in a lot of places so is it possible
that things go out of real estate and into other things like Bitcoin? I think it's possible.

Expansion of Digital Asset Markets

The London Stock Exchange is going to launch Bitcoin and Ethereum,
P2E, exchange-traded notes market.
The US SEC approved the first spot
Bitcoin ETFs, of course, leading to significant success within 50 days.
Following this, the UK announced plans to delve into digital asset exchange-traded markets.
The London Stock Exchange will introduce a Bitcoin and Ethereum ETN market,
accepting applications until April 15th, with a launch date set for May 28th, 2024.
This move comes after the notable success of spot Bitcoin ETFs in the US,
popularized by major asset managers like BlackRock and Fidelity.
That's interesting.
If you know, where are the Bitcoin, sorry, where are the Ethereum fees at the moment?
Me have minor issues with Ethereum because the fees were just crazy high,
I guess if you want to move a million bucks, they're low, but if you want to
sell something for 20 bucks, sometimes the fees seem to be higher, right?

[29:22] So, yeah, supply and demand of immigration is going to change based upon the
capacity for economic success in the host country.
Real estate has gone up from boomers who want some last minute money before they retire or die.
Maybe they might decide Bitcoin scratches that itch now that it's through proper
investment sources. Maybe, maybe.

Bitcoin as a Test of Humility

So Bitcoin is a test of humility, right? Bitcoin is a test of humility and a test of vanity.
Because it's very, very hard for people to admit how wrong they were.
Isn't it? Isn't it? I mean, I think that it's an essential aspect of any kind
of intellectual or emotional maturity to be able to admit you messed up. Right?

[30:13] And a lot of the boomers, and I say this being a year shy at the boomerville,
but a lot of the boomers were told about Bitcoin.
A lot of people were told about Bitcoin. kind of man, I've been talking about
it since 2011 or so, right?
So a lot of people were talking about Bitcoin and they were all like,
ah, it's magic internet nonsense, cash backed by nothing.
It's a scam. It's a bubble. It's blah, blah, blah, blah, blah.
You know, it's really, thank you for the tip. It's really, it's really tough
for people to say I was totally wrong.
And that's, that's painful, right? Cause you look at the money,
maybe that you've left on the table by poo-pooing something and all of that. It's wild.

[30:54] So, gas fees are so bad with Ethereum, it makes central banking look good.
Well, I mean, if you can't even get close to the fees that Visa charges,
we have some challenges. We have some challenges.
Somebody says, thank you for the tip, Michael Saylor.
Bitcoin will only collapse if Michael Saylor smiles. I mean a full-on cheese-eating grin.
All right. Michael Saylor is advising people and companies to go into debt to
buy Bitcoin as the return on Bitcoin is better than the cost of debt.
This is almost like the Dave Ramsey versus Robert Kiyosaki debate.
No debt versus cash flow, optimal indebtedness. Like Dave says,
if you have no debt, you just sleep better at night versus the other.
I'm also not sure if the debt-based approach has better outcomes at the end of the day.

Debt-Based Approach to Bitcoin Investment

Your philosophical thoughts on this.

Debt and Bitcoin Investment

[31:49] Advising people and companies to go into debt to buy Bitcoin as a return on
Bitcoin is better than the cost of debt.
I mean, I think mathematically that's hard to argue for sure.
If you have no debt, you just sleep better at night versus the other.
Um, well, anybody who talks about debt without talking about inflation,
I just, I'm not saying that these people do that or not, but let's say there's
some guy named Bob who's talking to me about, well, you know,
don't go into debt because you'll sleep better at night.
It's like, well, how well do you sleep at night knowing that your cash has dropped
over 20% in value over the last couple of years?
I mean, your money ain't safe if it's just sitting there, right?
So you want to, you want to think of, unfortunately, you want to think of fiat
cash, in my humble opinion, as a big pile of grain with birds around it,
right? The birds are pecking at the grain.
You say, well, I'm just going to leave my grain there. Well,
you're going to end up with virtually no grain and some very fat-ass birds.
Right? Your grain is disintegrating, it's dissolving, it's going bad,
it's rotting on the vine.

[32:59] So.

[33:02] Sleep better under a bridge rather than have a mortgage. Well,
and I mean, saying that there's just debt like it's one big blob is retarded.
It's ridiculous. Right? I mean, let's say that you have a job interview and
you got to have a nice suit and you go out and spend, uh, I don't know,
500 bucks on a nice suit because you want to ace this job interview.
And because of that, you get a job that pays you $150,000 a year,
but you went into debt by the suit. It's like, no, that's an investment.
I mean, if you want to drive Uber, you need a car. So you buy a car so you can
drive Uber. Oh no, but you're in debt because of the car. it's an investment.
So I don't understand these people who just say, well, if you don't have any
debt, you sleep better at night. Really? Under what roof?

[33:52] Under what roof do you sleep? If you don't have any debt, I don't have any hostility to debt at all.
Now, if you go into debt to buy things that lose value, well,
that's not great, right?
I mean, that that's, if, if you, I don't You know, if you go into debt to buy
frou-frou stuff that you use a couple of times and never use again,
and it just clutters up your garage or whatever it is, right? Well, that's not good.
If you go into debt to buy a home gym and then you never use your home gym,
then yeah, you've wasted your money.

Debt for Lattes vs. Investments

[34:34] So, yeah, if you go into debt, I don't know, like, let's say you buy,
I don't know, three lattes a day and it's 15 bucks a day, right?
I mean, that's not ideal, right? What's that, 450 bucks a month?
So, yeah, if you're in debt for three lattes a day, I mean, that's not ideal.
But if you're putting your money into something that's going to help you make
more money, then that's an investment.
So people who talk about debt and don't differentiate between investment or
things that increase in value versus things that decrease in value,
people say, oh, a car is decreasing value,
therefore you shouldn't go into debt for a car. Complete nonsense.

[35:22] It bothers me more than I can tell you when people come up with these nonsense
rules with no reference to circumstances. sense is.
It is perfectly valid and valuable to go into debt for a car that is very expensive.
And I know this personally, because when I was in the business world,
I got a car allowance, 700 bucks a month.
They gave me a car allowance. Now my cheap ass brain was like,
excellent, I can go and buy a beater and pocket that money.

[35:54] Or, you know, maybe return it to the company so so we can hire half a person
or something, right? And what did the board tell me? Right?
They said, no, we're giving you 700 bucks a month so you can buy a nice car,
a good car, a decent car, a new car,
so that when you go and pick up the director of IT from some Fortune 100 company
at the airport, you're not showing up in the Adam Sandler,
car of seven different colors that you've got to open the lock with a coat hanger.
Buy a good, nice, decent car. Because if you're saying, hey,
you should buy my software for a million dollars, come up and have a look at
the operation, and you show up in the cuff car,
then you're just going to look ridiculous and nobody's going to buy from you.
So are you saving money? No.
Yeah, Flintstones chic. That's right. Right.
You know, the car that you, the guy's got to help you push it downhill,
the bump start it, That's not going to spell success, is it?

[37:00] I don't know, man. You know, if you go into debt to buy sunscreen,
okay, so maybe you don't have sunscreen and maybe you get skin cancer.
I don't know. You've got to pay for that.
I don't know. It's just people just come up with these just stupid rules.
A car loses value, so you shouldn't invest in a nice car. It's like, why not?
If you're an Uber and you get to drive people around in a nice car,
maybe you get to charge people more.
If you're ferrying clients around from Fortune 100 companies,
you need to have a nice car.
So I picked myself up a nice 98 Volvo S70 Red, just like the Matchbox cars I
played with as a kid. Loved that car.
Drove that thing into the dirt.
13 years i got out of that car that was
nice that was nice and i
occasionally on my list in my mind i would go through all the
things that were still that were wrong with it like the radio didn't work one of
the locks didn't work i had a dent in the door um but that was after i was in
the business world and i i just drove that thing until i got i got pity money
when i traded it people were just like wow that is that is pity money you know
the car that screams please let me die.

[38:16] Mr ceo from fortune 500 help me load the beater into the tow truck yeah or if
you can't get the car started and you're supposed to pick the guy up from the
airport how does that look right so i don't know just like don't buy cars they
lose you you lose half the value of the car you drive it it off the line, you'd have to.
Well, then why is this? Why do people saying that everyone who makes different
economic decisions for me is stupid?

Wise Debt vs. Vanity Purchases

It's stupid, right? So I get if you're not making much money and you buy some
stupid vanity car that is going to cost you a fortune and doesn't make you any
money. Okay. That's a bad, that's a bad idea.
That's a bad idea. I thought I was doing good for getting a decent used car,
but I've torched $4,000 or so in issues over the last four months. Oh, yeah.

[39:04] My car has 364,000 kilometers on the clock, but still looks good.
Would not know the mileage is that high. Save your money to buy assets and settle
all debt as soon as possible.
So good. But you understand, that's a little lucky, right? That's a little lucky.
One of the things that used cars will often do is they'll mess with your cash
flow. You're really rolling the dice.
With a new car, you're not really rolling the dice. It's a new car.
You get some extended warranty.
I can sell you some, just kidding. right but if you've
got a new car your cash flow is predictable right because
it's going to be whatever the car payment and then you know ahead of
time what the costs are going to be you're covered by the warranty whereas if
you get a used car maybe you might be super lucky right you might be super lucky
or you might be really unlucky and of course this is what happens when people
get old cars but my car was 13 years old and had this or that and the other
problem and it's like so it's going to cost me x amount of dollars to fix and
maybe that will maybe i'll get another five years out of it without a lot of costs,
or maybe it'll be crazy costs over the next year or two.

[40:06] So, uh, Steph, have you seen that new cars are having issues?
Seems clowns are putting them together.
I mean, we, we know all of this, right? We know why. So, all right.
So yeah, I don't know. Just, um, if P like, I think it's still,
you've got to make the case for value as I've sort of been doing with, with Bitcoin,
you know, one case that I would make for, uh, for Bitcoin value is,
uh, governments can't use Bitcoins to fund wars.

[40:37] You can invest in a fiat or fiat-derived assets,
which raises the value of fiat, and fiat is used to start wars.

[40:49] I try not to pass too much money through my hands that has blood all over it.
Like, doesn't that seem kind of weird?
Like, if somebody hands you a $20 bill and it's streaked with blood,
wouldn't you be like, whoa, I really don't want to touch this.
I want to get my fingerprints on blood bill.
So, I mean, personally, that's the way I look at it, that it's peace and reason. It's peace and reason.
All right. This is from X.
BlackRock held a closed-door meeting for their top clients last month where
they said a 28% allocation to Bitcoin was optimal.
What would happen if the entire world rebalanced their portfolios to match what
a BlackRock maths quant suggests?
All right. So this is from Luke, M-I-K-I-C. You can follow him if you want on XLUKMIKIC21.
Of course, this is, I mean, this is, you know, finance crack, right?
But the math is interesting, right? So again, this is all math and not suggestions.
So what would happen if the entire world rebalanced their portfolios to match
what a BlackRock math quant suggests?
If the entire world puts 28% allocation into Bitcoin,
okay, let me ask you, what would be what would be the price of a bitcoin if
the world went 28% asset allocation to bitcoin.

[42:14] While we're waiting for that, James says, right, when you learn about the diamond
market, it's hard to translate that into a symbol of love and devotion for an engagement ring.
Right. 300 a month over two years versus 6,000 for a car plus 5,000 in maintenance costs.
Yeah, these, if you have, it's funny because if you have, if you're buying a
used car because you're low on cash,
you have to be concerned about, about like
you're going to worry about something you're either concerned that you're going
to have maintenance issues
which can be very expensive with older cars because it's tough to get
parts and expertise so you can
and of course the cars these days you really can't fix yourself because they're
basically half death star computers so maybe you'll be lucky maybe you won't
but if you have the excess money because you need to allocate more money for
the maintenance on a used car if you have that extra money maybe you should
just buy you a new car or you know my particular like like the car I'm driving at the moment.
I bought it used, but with a warranty.
That seems to be all right.

[43:21] Seems to be all right.
Bitcoin price prediction before halving, I guess, plus or minus 85,000 US. Okay.
So the amount of money that's in assets, of course, is massive in the world, right?

World Portfolio Rebalancing Impact

So if every place in the world,
if the entire world rebalanced
their portfolios to match the 28
allocation that a black rock
maths quant suggested so we got 900 trillion trillion times 28 is 252 a trillion
so the multiplier effect 252 trillion 4x is a huge number which is 48 million dollars per bitcoin,
48 million dollars per bitcoin and again you know can I validate this math it's
just very interesting I'm sure he's done the math seems like a smart guy but if,
people follow this investment advice from the black croc,
guys for the closed door meeting for their top clients 28% allocation bitcoin
was optimal what the guy says so,
48 million dollars per bitcoin that's really something something.
BlackRock and Fidelity now own a combined 379,151 bitcoins.

[44:43] These guys, I mean, they know something.
A slightly used car might be better. A lot of the new high efficiency engines
are overworked and aren't expected to last as long. Yeah.

[44:57] For me, the sweet spot is slightly used. Although I did buy a used computer.
I bought a used tablet computer for walking around and doing call-in shows.
And unfortunately, I didn't really think about this, but the battery was just too sad.
Because I guess the battery had been worked too hard. And I went to a place
and said, hey, can you replace the battery?
They're like, no, not on these ones. Because the moment we try to open it up,
the screen cracks and it's bad as a whole. also.
Not a wise purchase, but it happens, right? All right.
So, uh, uh, NILAM resources in partnership with cyber data announced plans to
acquire a special purpose entity called mind where to gain access to 24,800
bitcoins without detailing how it would finance the billion dollar cryptocurrency purchase.
I made financial uncertainties with NILAM projecting 2 million in EBITDA that's
earnings before interest taxes, depreciation, and amortization.
And the needed Needed one point, sorry, EBITDA and ZyberData holding 70 million
in shareholder funds, but only 1.5 million cash.
The firms face questions on raising the needed $1.2 billion.
Neil Amell issue new Class C stock for the transaction following a stock price surge.
Ex-CEO Ron McIntyre resigned, citing the move as a pump and dump schema and
signaling a potential FINRA investigation.

[46:17] I leave that for you to cook and bubble about.
Now, the Sandbeakman, Bankman Freed, the man who fried the bank,
is interesting because he's been sentenced to 25 years and $11 billion in restitution.

[46:39] So that's interesting because it signals that people who scam in the world of
crypto are facing significant punishments, right? I mean, obviously,
25 years in prison, $11 billion in restitution.
I mean, I assume some of that $11 billion has been, the crypto hasn't vanished, I assume.
So people have got a hold of the crypto. The crypto has gone up enormously in
value since, what, did this all happen in 2022?
So the moral hazard has been reaffirmed in the crypto space.
That if you scam, it's going to be really, really bad for you, right?

[47:17] So, let's see here. I don't know if the investors are going to be protected.
The EU committees have approved a ban on anonymous crypto transfers via hosted wallets.
The recent anti-money laundering legislation imposes certain limits for cash
transactions and anonymous cryptocurrency payments.
A majority of the European Parliament's lead committees have approved a ban
on cryptocurrency transactions of any value made through hosted crypto wallets.
This comes amid the European Council and Parliament provisionally agreeing to
expand parts of the European Union's anti-money laundering and counter-terrorism
financing laws to cover the cryptocurrency market.
According to an ex-post by Patrick Breyer, a member of the European Parliament
for the Piratenpartei Deutschland, Pirate Party of Germany, you know,
it's pretty cool that there's a pirate party in a landlocked country.
But hey, a quote, majority of the EU Parliament's lead committees,
end quote, approve the new AML laws on March 19th.
The new AML legislation applies certain limits for cash transactions and anonymous
cryptocurrency payments.
Under the new rules, anonymous cash payments over 3,000 euros will be banned
in commercial transactions and cash payments over 10,000 euros will be completely
banned in business transactions.
The new legislation is expected to be fully operational within three years from its entry into force.
However, Dylan Eustache, an Ireland-based law firm, expects the legislation
to become fully operational earlier.

[48:43] Many cryptocurrency networks function within permissionless environments,
allowing anyone to create a cryptographic private key and granting unrestricted
anonymous entry into the system, a fundamental principle of crypto.
In a press release after the lead committees approved the legislation,
Breyer outlined why he opposed the
bill, saying it compromises economic independence and financial privacy.
He said it considers the ability to transact anonymously a fundamental right
the crypto community has had mixed responses to
the regulatory measures some believe the new aml laws are necessary
while others fear they may infringe on privacy and restrict economic activity
so uh it but the question is does it legitimize crypto in the eyes of the normies
right and so i get the there's pluses and minuses to this but that's sort of of important as well.
So does it, does it get normies to say, well, you know, it, uh,
it's this anonymous, uh, uh,
it's been handled under anti-terrorism and anti-money laundering thing.
Therefore it's more legit. Therefore it's something I'm comfortable investing in and so on. Right.

Regulations on Cryptocurrency Transactions

[49:52] So, um, uh, the researcher, this is Jared, uh, is he, I roll maxing as the cool
kids might say, we got some straight bus and sailor tweets.
He got that risk for real, for real, all cap underscore exclamation mark.
Anyway, uh, sailor response to investor asking you if he should just buy micro strategy stock.

[50:12] And he basically said, and this is interesting, he said, Bitcoin's a commodity.
It's an asset without an issuer.
Whenever you invest in a company, you're taking counterparty risk.
In order to invest in my stock, you should reasonably read 1,000 pages of disclosures.
And I'll make the obvious point. People in Nigeria can't self-custody micro-strategy
stock, so we're trying to solve the problem of creating integrity,
sovereignty, you know, truth, and hope for the world.
That's going to be done via protocol,
right? Micro-strategy is simply a high-performance business, right?
There's a lot of other businesses, and every business does their thing in the
world as best they can. So we offer a very particular thing to us.
We offer convertible debt to convertible arbitrage. And they have billions of
dollars of capital and they can only convert arbitrage.
So if we didn't give it to them, their capital wouldn't come in the ecosystem.
So that's 1.4 billion that I got came from them. They went into Bitcoin.
I needed to do something for them. It's a complicated something.
There's a lot of volatility to it, right?
There's a limit to how much we can do. Okay, so, sorry, it's a bit more than
we need to know, but yeah, so if you invest in a stock, you generally count
self-custody, and he's just basically saying you should go straight to Bitcoin,
which I think is quite interesting.
Michael Saylor, of course.

[51:34] Performance since August 10th, 2020. Performance since August 10th,
2020. This is from a day or two ago.
And bonds are down 19%, silver's down 13%, gold is up 7%, NASDAQ up 50%,
Standard & Poor's up 56%, Bitcoin up 432%.
Now, what's interesting to me is I would assume those numbers are far wider.
Far wider because the other, you know, it's sort of like if you're at the gym
and people are really, really, really helping you lift,
you're not as strong as the guy who's lifting with additional weights,
people trying to hold it down, right?
So if you're benching 200 and people are really helping you,
you may only be benching 120, 130, 140.
If you're benching 200 and other people pushing down like crazy,
you might be benching 300, right?
So all of the non-crypto assets are to some degree inflated by money printing and Bitcoin.
I get people that are fleeing from the money printing to Bitcoin,
but Bitcoin can't be supported directly in that same way.

[52:41] So, yeah, it seems quite important.
Let's look at Bitcoin versus traditional assets, ROI versus US dollars.
So, to stand in the poor, over 14 years is up 346%.
I don't believe that's inflation adjusted, so who knows how much it is. Gold is up 96%.
Bitcoin is up 2.2 billion percent over 14 years. 2.2 billion percent.
Bitcoin Archive reports on BlackRock head of digital statement quote for our
clients Bitcoin is overwhelmingly the number one focus for our clients Bitcoin
is overwhelmingly the number one.

[53:27] Focus Bitcoin halving as of this recording we've got 18 days 4 hours 37 minutes
and 28 27 26 I'll just keep doing this for the rest of the show seconds So, that's important.
The network growth rate is enormous in Bitcoin. EXO, EH, EXO hash per second.
One EXO hash is one quintillion hashes.
A quintillion has 18 zeros or one million trillions.
Now I want a hash brown. It took Bitcoin roughly seven years to reach one EXO hash.
The network recently went from 500 EXO hashes to 600 EXO hashes in 69 days.
Days, hopefully at 4.20 in the afternoon.
So then just go through that again. It took Bitcoin roughly seven years to reach one exahash.
The network recently went from 500 exahashes to 600 exahashes in 69 days.
In terms of security, this means that the network is that much harder and more
expensive to attack or attempt to undermine. All right.

The Financial Burden of Owning a House

[54:33] It's uh it's truly wild i mean the entire infrastructure,
uh somebody says unlike a house bitcoin is real property because neither the
state nor squatters can take it away from me i mean hit me with a why if you've
ever been kind of shocked at,
how much owning a house costs,
oh but you're saving all of this money buying a house it's really something right,
it's really something alright let me just get to your comments it's really something,
All right, let me just get to your comments. Five bucks for a Starbucks egg sandwich.
And they also basically radiate them into neutron stars, don't they?
Like, don't warm it, because if I get it, it's going to melt through my hand like a lava rock.

[55:39] All right, Steph spitting facts for real, for real.
Let's see here. In the gold space, they advise to wait for the opportune time
to convert gold to real value, creating assets.
Do you think companies or people will sell their companies or assets for Bitcoin
when fiat finally dilutes completely?
Well, when fiat finally dilutes completely, who knows what it's going to look like?
Yeah, so owning a house is crazy. I don't just mean the buying it, right? Right.
So do you have to pay repetitive property tax of 1.5% of the value of your Bitcoin to hold Bitcoin?
You do not. Does Bitcoin need occasional repairs?
Do things break down? Do cracks appear in the basement windows?
Does your air conditioning break down? Do you need to clean its ducts?
You need like all of these things. Right.
So, you know, houses are kind of like vampires. They're on your neck and they're
just house drains your money. Right.
So

[56:47] Yeah so yeah so the idea well real estate you know
you get do you get mice in your bitcoin yeah that's
another thing too a friend of mine had uh uh trash
pandas in the walls you could hear them slithering back and
forth in the walls crazy that's i
mean the things the number of things that can go wrong with a house is is pretty
much infinite and houses are just like 80s
bullies that pick on you for no reason they just they just turn on you viciously even
new houses yeah i mean the list of things uh what's some crazy stuff that's
happened to you with regards to uh to houses yeah you you know you get stuff
in the you get critters in the attic and you get stuff in the ducts and you
know stuff breaks down on a regular basis and you know every house owner's nightmare nightmare is,
you know, the pause, right? You've, oh, there's some cracks in the foundation.
And the guy comes and he says, oh, oh, oh.

[57:44] Yeah, a lot of people in this state, they do want, yeah, do you get bad neighbors
moving in next to your Bitcoin?
Yeah, that's true. That's true, right? That's important as well.
And of course, yeah, so, I mean, governments are looking to grab a hold of any
money now, and they don't want to wait for the capital gains tax,
which only kicks in when you sell. So, yeah.
In an economic Armageddon scenario, could the government claim or steal everyone's
Bitcoin and regulate it? I don't think so.
I don't think so. But,
Andreas.

[58:19] Antonopoulos is the guy. He's the guy who gives you the best answers as to whether
people can take over the Bitcoin network.
Antonopoulos. A-N-T-N-O-N-O-P-O-U-L-S Something like that.
But yeah, that's the guy. That's the guy to go into with that.
All right, let's finish up here.
I think I'll, with all due respect, Jared, I think I'll skip the power law,
but it does seem quite important.

[58:47] Kathy Wood has, calls Bitcoin a financial superhighway, reiterates a 1.5 million
per Bitcoin price target.
She said, there are signals that not all is well in the world.
She said about countries like Nigeria, one of the biggest adopters of Bitcoin
because of the strong depreciation of the country's currency.
Because of that, Wood sees Bitcoin as a risk-off asset and a risk-on asset.
ArcSpot Bitcoin ETF has become one of the more successful Bitcoin ETFs among
the 10 funds issued in January.
Wood said that with more institutions entering the space, mathematically speaking,
Bitcoin's price could easily rise above $3.5 million.
However, she wouldn't give a new specific price target. Bitcoin has miles to
go, she said instead and pointed out to her previous call of 1.5 million price target.
It's tough, you know, because there's going to be a lot of people who wait until
inflation is so high before they start looking into Bitcoin,
but because inflation is so high, they can't afford to buy Bitcoin because inflation is so high.

[59:49] Can Bitcoin renovate its flat living below you from 8 a.m. to 5 p.m.
Seven days a week with only power drills on max? Oof, yeah, yeah, that's true.
A chimney repair I was not prepared for and too cheap to pay 3K to fix,
so I found myself five stories up doing it myself.
If you aren't rich and want to own a house, you need to be handy.

[1:00:11] But time is not free, right? People say, well, I save money by doing it myself.
Time is not free right you
understand you can always make more money you can't
make more time well i suppose you can make more time in a sense by
exercising and eating well and maintaining a healthy weight that's probably
going to extend your lifespan but yeah people are like no no it's free because
i did it myself it's like no it's not the opportunity cost of everything else
you could have been doing maybe when you were repairing your chimney like some
victorian Victorian six-year-old,
you could have been out there meeting the girl of your dreams, right?
So nothing is free. Well, we all know that, right?
All right. Tips, people. Come
on. Think of the value that I'm offering and have over the last 18 years.
If you haven't tipped for a while, now's an excellent time to do it.
If you haven't tipped for a while.
Of course, if you're listening to this later, you can go to freedomain.com slash
donate to help out the show that way.
That's freedomain.com slash donate.
And I would really appreciate that.
Let's see. What has happened to itty-bitty-ditty coins over the course of this show?
They have gone up. Yes, they have. We are now at almost 95,000 Canadian,
or if you translate that to Bitcoin.

[1:01:39] $94,868.13 per Bitcoin. coin. If you translate that to Bitcoin, it's one Bitcoin.
One Bitcoin equals one Bitcoin. I just do that math in my head because I just
love to show off my autistic math skills. One to one. One to one.
All right. Well, thanks, everyone, so much for dropping by today.
A great pleasure. Thanks to Jared for doing the research for some of this stuff.
Stuff. And I wish you the very best. Have yourself a great weekend.
We'll talk tomorrow at 11 a.m. for a regular old show.
But lots of love from up here. I hope you do well.
I know, it's insane math skills, isn't it? I can do that one-to-one thing without
even using my colon. Alright.
Have yourself a great afternoon, and again, if you're listening to this later,
freedomain.com slash donate, and take care everybody. Talk to you soon. Bye.

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