BTC Sessions - Wall Street BUYING BITCOIN! Legendary Investors Reveal They Hodl EP114

Starting point is 00:00:18 Wasabi wallet and fairly private. What is up, everyone? I'm Ben with the BTC sessions. Today, we are going to be chatting about Wall Street buying into Bitcoin. We're going to be chatting a little bit about mistakes of the past by OG bitconers that maybe fell prey to their high time preference. We're going to be talking about Ethereum, effectively having a non-planned hard fork, a surprise hard fork.

Starting point is 00:00:50 if you will. We're going to be touching on all that and more today. I'm Ben with the BTCA sessions once again and this is your daily session. Now before we dive in, of course, shout out to sponsors of the show, leaden.io, where you can use your Bitcoin for a variety of different services. Of course, they've got their Bitcoin backed loans. So this is where you can use your Bitcoin as collateral to get Canadian or US dollar loan. So if you're in a pension, you don't want to sell your Bitcoin because that's a taxable event. And you're worried to do that. about having a buy back in at a higher price, this could be for you.

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Starting point is 00:02:00 and if you click the link and opt to get one of their loan products, they will give you $25 worth of USDC for free directly into. your savings accounts. Now, up next, we have the Legends at Crypto Cloaks. I love these guys. I've got more stuff coming from them on the way. Hardcore bitcoins with 3D printers pumping out incredible swag. I have a node shell already.

Starting point is 00:02:24 I've got my Bitcoin coaster and everything. I've got my Triton on the way to kind of pimp out my node. I've got a grenade on the way. I've got a bunch of different stuff. So definitely recommend some of the best swag I've ever gotten. CryptoCloaks.com, head over there. If you want 5% off, use code BTC sessions at checkout. Now, the Kobo Vault, you guys have heard about this before.

Starting point is 00:02:48 It's one of my regularly used hardware wallets now. I love it because it's air-gapped. Everything is offline done via QR code, keeping the keys to your money safe and, as I said, offline. Now, they've got a deal coming up on Black Friday, so don't miss it. I believe you're going to be able to get somewhere in the realm of 15% across their entire store, if I'm not mistaken, but, you know, stay tuned.

Starting point is 00:03:12 You can head to the link in the shots down below and drop your email if you'd like to get notified when that launches. But even if you're just curious about the Kobovolvold, check it out. Again, they've got Bitcoin-only firmware, secure element, and it works with all of my favorite wallets. The ones that really stand out to me are Wasabi Wallet on desktop and Blue Wallet for Mobile because I use those all the time, and this thing is great for that. And finally, we have bit refill if you live on Bitcoin like I do.

Starting point is 00:03:41 So I know there's a few and far between. Or maybe you've just had a good run up in price and you feel it's time to treat myself. Well, you can head to BitRefill and just get an absolute plethora of gift cards, pretty much everything you need. I use it all the time now because, again, Bitcoin is my living. I live on Bitcoin. The majority of my income is Bitcoin. And so this is a godsend for me. Not to mention when I spend here, I actually earn Sats back, which is an excellent bonus.

Starting point is 00:04:14 They work pretty much across the globe, a ton of different countries. So head over there, check them out. There is a link in the show notes down below. I particularly like BitRefil because it also helps a little bit with privacy in that the merchants that I'm spending at. They don't need all my private information. They don't need my credit card numbers, stuff like that. BitRefill fills that niche. for me. And with that, let's dive into the show here. I'm going to start off on the bitbo.io

Starting point is 00:04:40 dashboard. Great place for all your Bitcoin information on the fly. We're sitting around $15,700 for Bitcoin right now. We earlier came just this close to 16K. We were $10 or $20 off depending on where you're looking. We were about $21 off looking at Bitbo here. The stats per dollar right Now, 6,365 Satoshi's can be bought for a single US dollar. A few other stats were at block height, 656,493. 88.29% of all Bitcoin that will ever exist have already been issued as of today. And when it comes to fees right now, probably a good time to get some Bitcoin transactions in. If you were thinking about moving stuff around, we're waiting for a slower time and lower fees.

Starting point is 00:05:33 Next block, eight sats per byte, 30 minutes, five sats per bite, one hour, three sats per bite, and anything beyond one day. You're looking at only one sat per bite. Again, probably a good time to get some of those transactions done. Those one sat per bite days are probably going to be fewer and further between as this bull run intensifies, but we shall see. Let's dive into the first story here. So this from Forbes, Wall Street legend Bill Miller reveals strong. recommendation despite a strong Bitcoin recommendation despite massive price search. So Bill Miller, the founder of investment manager, the founder of investment manager Miller Value Partners,

Starting point is 00:06:16 has said he strongly recommends Bitcoin at current prices, branding it the single best performing asset class of the last year, five year, and 10 year periods. He said, quote, Bitcoin has been very volatile, but I think right now its staying power gets better every day. He told this to CNBC. I think the risk of Bitcoin going to zero are much, much lower than they've ever been before.

Starting point is 00:06:44 He went on to say, I think every major bank, every major investment bank, every major high net worth firm is going to eventually have some exposure to Bitcoin or what's like it, which is gold or some kind of commodities, Miller said. Adding, he thinks inflation

Starting point is 00:07:01 is coming back due to Federal Reserve gunning the money supply. Earlier this year, Bitcoin went through a scheduled supply cut, we all know this from the having, putting it at odds with central bank quantitative easing and stimulus measures. Quote, the Bitcoin story is very easy. It's supply and demand, Miller said. Bitcoin supply is growing at around 2.5% a year, and demand is growing faster than that, and there's going to be a fixed number of them. Yeah, so pretty concise here. Now, in the same vein, we also have legendary macro investor Stan Drucken Miller announced support for Bitcoin. So on Monday, Wall Street investor Stan Drucken Miller announced that he is long Bitcoin. He's the president of Duke DeKentz Capital, I hope I say that

Starting point is 00:07:53 right, which closed in 2010 with $12 billion under management. He is also one of the few investors to have made a large amount on his investments in 2008. His net worth is estimated at $4.4 billion. On CNBC, he explained that he thinks Bitcoin has a lot of attraction in it from millennial investors and West Coast money. They got a lot of it, he added, referencing the aforementioned demographics and the propensity to buy Bitcoin. On how Bitcoin stacks up against gold, he said he thinks Bitcoin will work even better

Starting point is 00:08:29 than gold if the gold bet works. Gold has traditionally obviously been seen as a hedge against inflation, having held its purchasing power over decades. He did not disclose what percentage of his portfolio is in Bitcoin, though he did say he owns multiples more in Bitcoin than gold. And I think that speaks volumes. Now, on the opposite side of that coin, we have the CEO of Microstrategy, and if you're unfamiliar, maybe you've been on a rock somewhere, but the CEO of Micro Strategy, Michael Saylor, famously and recently piled $450 million of his company's $500 million treasury into Bitcoin, and he just saw it as a natural play because his wealth was eroding away beneath him.

Starting point is 00:09:24 And so this article here from Decrypt, Micro Strategy CEO Michael Saylor suggested today the comparison between Bitcoin and gold may not be entirely accurate and that the former may end up cannibalizing the latter, responding to a substack post from Anthony Pompliano, a popular podcast and co-founder of the hedge fund Morgan Creek Digital. Saylor wrote that it is dangerous to think that gold and Bitcoin are similar and complementary investments. When the Bitcoin dragon emerges from its lair, the first thing it will eat is the kingdom of gold. Yeah. And I think what he's getting at here is if you're looking for a store of value, if you're looking to put your money into something or hold a money that retains value and

Starting point is 00:10:18 is scarce and thus appreciates in comparison to depreciating. dollars. Where are you going to put your money? Like you could roll the dice on equities and own some stocks or you could put it in something like gold that has historically been around for a long time and does indeed hold purchasing power quite well. Or you can put it into something that effectively takes gold and the qualities of gold and improves upon them by an order of magnitude. And he's basically saying, listen, you've seen digitization of every major thing. Amazon with retail. You've seen things like Facebook with social networks. You've seen the digitization of search and internet with Google making basically information searchable. Again, Twitter to

Starting point is 00:11:15 a kind of lesser extent. Same thing with Airbnb and Uber. And And basically whatever industry or thing that we need being digitized tends to just explode and replace everything else. And that's his thesis here with gold. Now, I tend to think that this will take quite some time. We've kind of seen it very slowly play out with gold and silver. In that gold is more scarce and has better monetary properties than silver in terms of storing value.

Starting point is 00:11:54 And over time, we've seen silver lose quite a bit in terms of gold. Now, yes, there's short-term volatility, but, you know, the value of gold and the scarcity of gold is much more than that of silver. Now, somebody who isn't buying this is, sadly, Ray Dalio. And I've read his book and principles, which is actually quite good. but I think he's missing the boat here. Anyways, I'll read a little bit from this Coin desk article. So Ray Dalio, the founder and co-chairman of Bridgewater Associates,

Starting point is 00:12:30 the world's largest hedge fund, said he sees three main problems with Bitcoin and other cryptocurrencies that will limit their future, including that governments will outlaw them should they start to become material. So in an interview with Yahoo Finance, Dalio said he expects more digitized versions of government-issue currencies. in the future than Bitcoin and other cryptocurrencies for three reasons. Number one, he said, a lack of venues that will accept cryptocurrencies for purchase. I can, I today can't take my Bitcoin yet and buy things easily with it. Number two, he said, Bitcoin and other cryptos are too volatile to be considered an effective store of wealth.

Starting point is 00:13:08 That volatility also hurts Bitcoin's use transactionally because vendors won't know how much they're getting, Dahlio said. And number three, he said, if Bitcoin and other cryptos become, quote, material, he predicted governments will outlaw it. They'll use whatever teeth they have to enforce that. He said, I don't think digital currencies will succeed in the way people hope they would. Now, I'm going to go through each one of these points and say why I disagree. So he says, a lack of venues will accept cryptocurrencies for purchase. He said, I can't today take Bitcoin yet and easily buy things with it. I'd live on Bitcoin. Literally the opposite of what he says.

Starting point is 00:13:46 Now, is it like, can I go direct into a brick and mortar store and without question be able to buy things with Bitcoin easily all the time? Not exactly, but technologies have been built to bridge those gaps. There are effectively debit or credit cards that link up to accounts that hold Bitcoin in that can be used. As you've seen with stuff like Bit refill and living off Bitcoin here in Canada, up bull Bitcoin I used to pay some bills. Same thing with Bitcoin solutions being rebranded Bitcoin well. Same thing. You can pay bills with that. So if I can live when the majority of my income is Bitcoin, that point is already moot. But then the question becomes, if you're not living on Bitcoin like me, if you see value in Bitcoin, do you want to spend it? That's not really

Starting point is 00:14:44 currently it's not the use case for everybody people are seeing it as a store of wealth over time and if so then gresham's law states that good money drives out bad or put another way if you're holding two different types of money and one loses value quicker you're more likely to get rid of the one that loses value quicker okay so on to his second point he said it's too volatile to be considered an effective store of wealth, which is part one of that. Again, I think he's looking at this through too high of a time preference. He's looking at, you know, over the course of, he would have to be looking at it over the course of, you know, a year or two, maybe, maybe three. Because if you get even out to the time frame of a four-year kind of Bitcoin epoch between the cuts and supply,

Starting point is 00:15:36 it's never gone down in those four-year periods since inception for the past 12 years. It's never gone down. If you look at the, I believe, the 200 week moving average, which is about four years, it doesn't, it's never dropped. If you look at the chart, it never actually dips. It levels out a little bit, but it just continues to rise. So volatility is relative and you need to look at it in the context of a longer time frame. I'm talking decades and potentially generations.

Starting point is 00:16:16 He also goes on to, again, talk about transactional use cases. And again, he's kind of stuck in that mindset. Well, what can I buy with it? You can buy stuff with it. But the real question should be, do you want to if you have dollars to get rid of? And then finally, he said if they become material, governments will, outlawed. Some, perhaps, him being from the U.S., I think that's already out the window. You see Bitcoin-related banks being approved in Wyoming already.

Starting point is 00:16:49 You see very actual friendly regulatory, you know, I'm not a fan of regulations, but the regulations that have been rolled out thus far don't beck into the idea of banning it soon. it's more, hey, let's try to integrate this into the existing infrastructure. You see even just this past election, you see senators being elected, I believe it was a senator, that's pro-Bitcoin. You see other senators in the House discussing during Libra's kind of inquiries talking about Bitcoin and talking about shitcoins. And you have a lot of, what I'm getting at is Bitcoin is kind of making its way into everyday

Starting point is 00:17:33 society and everyday society is full of regular people that can learn about Bitcoin and see the value. And so I think by the time it becomes quote unquote material, as Dalio says, so many people will be incentivized to keep it, to keep it above board, to keep it accessible and legal that the pushback from those individuals, wherever they may work and wherever they may be, I think it's just going to be a losing battle to try to outlaw. It's already come too far. And on top of that, you have these major funds.

Starting point is 00:18:11 It's being very much looked at now from private equity firms, from major companies. If you outlaw them owning it, then you're going to potentially, especially if it becomes quote-unquote material, you're going to tank the stock market. you're going to tank a lot of companies and put them out of business because they have to effectively dump a large part of their treasury. So, yeah, I just think he's missing the point here. I don't think he's right. And it's unfortunate because he's right about a lot of other things.

Starting point is 00:18:43 But, hey, I guess we all get our chances to be wrong from time to time. Let's skip over this. I'm going to move on. Okay, so this I wanted to talk about this from. I-News, there was an author named Elizabeth Anderson, and she wrote an article three years ago around Bitcoin's peak, and she talked to three different investors. And I just wanted to outline something here about one of the people she talked to. And it's the same kind of idea for all of them. But she said in her article here, three years ago, I spoke to young investors passionate about the future of cryptocurrency.

Starting point is 00:19:27 Are they still feeling bullish? Alessandra Solberger, now 32, first bought around 400 Bitcoin for less than $9 in mid-2012, after hearing about the currency through her work at a private equity firm. The Oxford University graduate who grew up in Switzerland and worked in private investing sold more than half the coins when the price hit $82 in March of 2000. 2013, making her more than $20,000. She sold most of the rest for $600 a piece in 2014, netting a further $60,000. So this girl who got into Bitcoin super, and again, hindsight is 2020, obviously, but this girl got into Bitcoin early, heard about it and bought the bulk of everything she owned in 2012. And then proceeded to sell in 2013 and 2014 made a hefty profit on versus her like $9 a coin or whatever.

Starting point is 00:20:39 But she effectively took what today would be worth somewhere in the realm of $65 million. and instead got 80 grand. And again, who could have known where it was going? But it goes on to say she hasn't bought more. She's still holding onto a few coins from back then. So at least she has something sitting there. But she hasn't continued to move into Bitcoin. And I think it kind of beckons to,

Starting point is 00:21:18 a lack of understanding of the gravity of Bitcoin. And so what I mean here is this individual believed, and they were getting in dollar terms, a solid return on their initial investment. But you need to step back and think, do you want the dollars? looking at the amount that she was able to get, 80 grand, that's like a pretty good,

Starting point is 00:21:52 a pretty good higher salary in the U.S. for a year. She basically gave up generational wealth, like life-altering wealth for multiple individuals over generations that she could pass down in exchange for like a freebie year, a year of not having to work. pretty much is what that amounts to. And I think a lot of people will continue to go through this.

Starting point is 00:22:21 The lesson that I'm trying to imbue upon you is don't underestimate the, as I said, the gravity of Bitcoin and the implications of it on society and just how valuable it can be. there's going to be especially if it seems to me pretty obvious that we're heading into a 2017 style insane bull run but be careful not to lose your head and lose sats that you'll never be able to recover if you get to a point and something will make a material change in your life and and really improve the quality of your life for the foreseeable future and you have enough to do so and still, you know, be doing well in terms of your Bitcoin position, then absolutely. But to lose it all or most of it, especially again, 400 Bitcoin for a year off.

Starting point is 00:23:33 Holy God, it hurts to think about it. But again, that early on, you wouldn't have fully known the implications of what was coming down the line. But I think people are better positioned to understand that now, hopefully, at least ones that have been around for a long time. And so I do encourage you to look at it that way. Bitcoin is an excellent teacher, but it doesn't pull any punches and it teaches the hard way. And this is an example of such lessons. Okay, moving on here. We saw a drop of Bitcoin hash rate.

Starting point is 00:24:14 In fact, the second largest drop in Bitcoin hash rate ever in terms of actual power dropping off the network. This, in part, due to a lot of miners are in the Sichuan province in China. And during rainy season, they have to shut down a lot of the machinery. and relocate. And so this happened once again, but because the hash rate has grown so much, the hash rate also can drop quite a bit. Now, this is interesting for a couple of reasons.

Starting point is 00:24:48 So I'll read a little bit from Coin Desk here. Kudos Zach for the article. Thank you for this one. Bitcoin's hash rate bounced 30% Wednesday from quarterly lows on November 2nd as miners brought ASIC machines back online and after relocating them out of China's Sichuan province as the wet season ended in late October,

Starting point is 00:25:09 as CoinDest previously reported. So we saw a massive decline in hash rate and then a massive rebound now. So Bitcoin's mining difficulty registered a record-setting percentage decrease on November 3rd, the largest since the advent of ASIC miners, as miners shoveled their machines around the globe to access cheaper power,

Starting point is 00:25:31 causing the network's hash rate to drop considerably. A large percentage of all machines taken offline through the end of October are back online. There are, of course, some that may take longer, but the relocation process typically is a brief two-week period, and it's now finished. So the quote here says, most miners can unrank, drive them over, and reinstall in less than two weeks. miners return to Inner Mongolia, Xinjiang, Tibet, and other regions to tap into fossil fuel, wind, and geothermal power sources in those regions.

Starting point is 00:26:10 This year's minor migration is different from previous years, according to the interviewee here. Some Chinese miners have decided to move out of China altogether. He named Iran, Kazakhstan, and Venezuela as popular low-cost mining destinations. He said the Chinese are getting very comfortable with hosting their miners in Iran and Kazakhstan with local partners. And so again, I think we're going to continue to see this.

Starting point is 00:26:36 People always point to China and say, well, there's centralization of miners in China. Yes, there's a large number of miners in China, but that's been steadily decreasing over time. And we're seeing more and more of it. We're seeing more mining in Canada, in the U.S., in Iceland. And as we said, Iran is becoming a major player. Kazakhstan is a major player. We see more in Russia and Venezuela. Places, wherever cheap power is available,

Starting point is 00:27:03 that's going to gradually pull hash rate and distributed across the globe. So, yeah, exciting to see the further decentralization of mining. Now, the opposite of decentralization, Ethereum. Let's talk about that. So the Ethereum blockchain network suffered issues Wednesday morning. That's under-selling. with knock-on effects at related service providers.

Starting point is 00:27:31 In a service announcement, soon after 8 UTC, Ethereum infrastructure provider Infura said it is experiencing a service outage for its Ethereum Mainnet API, and it was investigating the issue. Infura provides API access to the Ethereum network for other applications and services. The outage has prompted some Infura users

Starting point is 00:27:54 to halt Ethereum-based services, over the issue, including Metamask and Binance. So, effectively, at some point, the quote here, at some point Ethereum developers introduced a change in code that led to a chain split starting from block, whatever that is. I'm not going to read the number. Anyways, they called it technically an unannounced hard fork. Those who haven't been upgrading their Geth nodes for a while,

Starting point is 00:28:26 I presume several months at least, got split with those with new get versions. Now, there's a major problem here. Now, a lot of this infrastructure is back online, but it beckons to the fact that most people are depending on a centralized service to interact with Ethereum rather than individuals using Bitcoin that can easily run their own nodes, myself included, don't have that problem. I'm not relying on somebody else to run it for me and referring to their copy of the blockchain. I run it all myself. And as we've seen over time with Ethereum, that's getting less and less possible for most people. Now, the interesting thing about this, and this is a tweet retweeted by Matt Corallo. This tweet here from Mike W on Twitter said,

Starting point is 00:29:20 the bigger bug is that the devs purposely kept the consensus-breaking changes a secret, claiming that revealing the change would cause more disruption. So instead, they don't tell anyone about the change and just require everyone to, quote, be on the latest version. And Matt Corallo tagged onto that. He said, according to this, not only did Eith have one of its worst bugs ever, but the devs botched the disclosure of it and didn't even mention it to likely the largest operator of Ethereum full nodes. Again, you're relying on other people to run this infrastructure

Starting point is 00:29:57 for you. And so there's no better definition of centralization than referring to somebody else to do it all for you and that taking out a massive part of the network. Not only that, but they're saying, well, just update. Make sure you keep updated. Well, who's pushing out the updates and making sure bugs like this don't exist? Apparently, no. because the bug was able to get through. And beyond that, nobody's auditing it to figure out what the fuck is going on and if it's going to happen. You know, nobody audited this. Nobody saw it coming.

Starting point is 00:30:30 And then it wasn't disclosed. And nobody noticed until it was a catastrophic split in the, in the blockchain. It's just, I don't know. I don't know how you can look at Ethereum and see it as decentralized when stuff like this happens all the time. last Christmas around December they rolled out a hard fork which was planned and they forgot to put some shit in and they rolled out another hard fork two weeks later

Starting point is 00:30:57 on New Year's Day so like every exchange operator had to be updating whatever they're running I guess maybe not if they were relying on infura but still nonetheless the fact that they could roll out a hard fork two weeks after a hard fork and just be like that's fine

Starting point is 00:31:14 just kind of, again, refers to the fact that most people aren't running Ethereum. Somebody else is running it for them, and it's in Fura. So anyways, there's my rant. Holy God. Now, the opposite end of the spectrum, we're seeing more and more stuff around Bitcoin nodes. And this website, node. guide, put together by Bitcoin Q&A, hats off to you, sir. he put together kind of like this this de facto node guide why run a node considerations

Starting point is 00:31:47 types of nodes he gives you all the different types he was gracious enough to include one of my tutorials in the do it yourself section under umbril but there's a lot of great information here so if you're curious about nodes you can head over here i'll link it down below or you can just search on youtube i've done tutorials for both my node and for umbral and both of the those are kind of do it yourself if you want to buy the parts and then running the running the software is quite easy actually. So be sure to check that out. And the other thing I'd love you guys to check out, I just did a new video on Nunchuk. And so this is basically a desktop wallet that allows you to plug in your hardware wallets and

Starting point is 00:32:29 interface with them there. But it also allows you to combine your hardwallets into a multi-sig solution, meaning that if you have maybe three hardware wallets, you can require at least two of them approve before moving any funds. So then you place those hardware wallets in different geographically diverse locations. And then that way, if somebody breaks into your home and steals a hardware wallet, they've got one piece of, they're unable to move funds even if they crack that hardware. So yeah, check it out. I made a full tutorial.

Starting point is 00:33:04 I'll link that down below. With that, I'm going to wrap up, you guys. maybe I'll get some music, some mood going on here. There we go. Anyways, I'm going to wrap up, guys. Thank you very much for watching and or listening. If you are here on YouTube, please do hit like, subscribe, and share. All of those things really, really do matter.

Starting point is 00:33:23 They help bump up this type of content, my content, in front of more eyeballs. And it's really been helping lately. So thank you to all those that do such. If you want to help out of the show in another way, you can hit the sponsors I mentioned previously down below that was leaden crypto cloaks cobo and bit refill check them out again checking them out also helps the show and if you really loved what you saw you can always drop me a bitcoin lightning network tip at my tipin dot me page that is t i p p p i n dot me slash at btc sessions with that i'm out have yourself a wonderful day a wonderful evening wherever you are and i'll see you next time for

Starting point is 00:34:01 your daily session

BTC Sessions - Wall Street BUYING BITCOIN! Legendary Investors Reveal They Hodl EP114

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