TFTC: A Bitcoin Podcast - #668: The Debasement Trade Goes Mainstream with James Check

Episode Date: October 8, 2025

Marty sits down with James Check to discuss Bitcoin's structural market transformation, the debasement trade gaining mainstream recognition, treasury company dynamics, institutional adoption patterns, and why this cycle's compressed volatility and sophisticated bid-side support signal a fundamentally different monetization phase.

you've had a dynamic where money's become freer than free if you talk about a fed just gone nuts all all the central banks going nuts so it's all acting like safe haven i believe that in a world where central bankers are tripping over themselves to devalue their currency bitcoin wins in the world of fiat currencies bitcoin is the victor i mean that's part of the bull case for Bitcoin. If you're not paying attention, you probably should be. James, the debasement trade is on. New all-time highs are here. It's all one trade, mate. It's all one trade. There's something wrong with the denominator. It really is. It really is. And people don't realize it yet. It's fascinating, right? And like I've said this

before, I think even on this pod, it's amazing to me that like bond traders, I love Luke Groman's limer is like they have to lull them to sleep and just like slowly anesthetize the bond market they have to just like pretend that they're going to try and solve this problem don't worry just hold these bonds we're going to mandate these ones or no it's okay we're going to try and get yields down which means bond prices up and it's like guys it's just they're shit coins they really are and this to the skeptics out there the bitcoin skeptics it is astonishing i think uh mitchell hodl he had this tweet from earlier today i'll i'll pull it up because i thought it was a good one uh new all-time highs today and people for better for worse still believe bitcoin is a fad

um not something to pay attention to but if i mean we've talked about this many times i think how far bitcoin has come in only a little under 17 years is is miraculous and it shows here like we'll look back on Bitcoin's monetization in Marvel at how fast it happened. On the zoomed out timeline of humanity, Bitcoin's takeover happened virtually instantaneously, truly a zero to one moment. Totally. So here's an interesting thought that I'd be curious to get your ideas on. I don't know about you, but I'm certainly observing that Bitcoin has become desensitized to it. So there's almost this bifurcation of how people are observing and analyzing and studying Bitcoin, people who are coming in now, let's call them the trad

fives, the retirement accounts, like, granted, there's still a small chunk of the overall demand, I would estimate something like 20 odd percent or thereabouts. They're coming in and going like, they just see the iBit chart, it's in a bull market, it goes up only, what's not to like? And then you've got all the Bitcoiners who've been around through all the high octane phases looking at this thing being like, oh, God, this cycle sucks. It's so slow, so boring. you've got this real interesting dichotomy where it's like it is monetizing at an incredible rate

think about some of the headlines that we see these days if you told yourself that back in 2020 back in 2018 for you back in 2013 14 50 you wouldn't believe it right you just actually couldn't believe it's happening and now we're so desensitized to it there's like this bifurcation of the market what are your thoughts on that i think bitcoin bores people to death it is what bitcoin does it lulls people into a state of complacency and uh uncomfortability where they're not happy that it's not reaching new all-time highs every day but again it's insane looking at the charts now we're at two and a half trillion dollar market cap and thinking back to our conversation earlier this year where bitcoin had established itself as a two trillion dollar

asset it's already added 25 more in market cap since then and it's like what do you what do you people want what more do you want it's up almost 100 and over the last one year it's up 32.6 year to date five years up over a thousand percent like it is monetizing in real time but you were alluding to some things that have manifested over the course of this year that may have some long-time bitcoiners butthurt because they made the wrong decision oh yeah the old treasury company trade this i mean there's one of those things that like i love it like all things i love the gray zone the gray zone is where i find it interesting um and you know you look at some of the comments i get on twitter i'll you know i'll poke fun of them on

twitter saying you know bitcoin's at 125 grand it's punching all-time highs and i just flick through all the treasury company charts down 60 down 70 down 85 down 95 it's like some of them punching new lows as Bitcoin is ripping to new all-time highs. You just look at this thing like something is going on here, right? The market is, in my view, like my real high-level view, I've had this line that MNAV gravity is towards one. It appears to be that MNAV gravity is indeed towards one. By the way, gravity just means that's the acceleration. That's where it wants to go. There are a handful of these companies that I think are going to be able to fight that gravity, but you need a toolkit right and if your stock goes below one it's just hard to dilute shareholders

we're below one and then people are saying oh well why don't they buy back this stock and i'm just like why would you want to own a hedge fund that isn't a hedge fund that basically sells bitcoin at the high before it runs to buy back their stock which is in a downtrend right you're like you're rotating out of your winner into your loser why would i want to own a company that does this. So I just think the toolkit for companies that aren't strategy, that aren't maybe meta planet, like there's a handful of these things that make sense. I just think the market's sending a really, really brutal signal that there isn't quite the demand people thought there is for this like hundreds of treasury company trade type idea. Companies are saving, Bitcoin's great.

But like, I just think there's a lot of capital that's been incinerated. And I think that's Put a dampener on moods, honestly. Some of them might come back, and if Bitcoin goes on a tremendous run, there's no question there'll be some kind of premium baked back into these things. But will they ever, like if you go and do that calculation of what it takes, if you're down 95%, if you're down 95%, it means you've been down 90% and you've been cut in half again.

You've got to get a really, really big return to get back to break even, like to get back to break even. So it's just a challenging proposition, I think. It really is. and for most of these companies i agree with you there's going to be a parade of distribution probably even more pronounced of a distribution and it just i've been saying it all year it's just too good to be true that you can just easily spin one of these up and issue shares do converts whatever it may be accumulate bitcoin and have your stock outperform

bitcoin to your point like operating businesses that are profitable doing something completely different and unrelated to bitcoin that has value uh and provides utility to the market is and they're funneling their profits in the bitcoin that's i think that's the best strategy long term totally i mean our business does exactly that so like and that's that's the separation there's like the all-in sailor style strategy whenever i talk about treasury companies that's all i'm talking about like companies that just sweep cash into btc good fantastic exactly what you should be doing. It's the ones that go all in. That is a very, very tough. It's a tough business because you don't have the scale. Strategy has the scale to tap debt markets. They have the scale to do

preferreds. They have enough inertia where the market believes that they can, 640,000 corn, sure, it's going to be hard to double your stacks. An MF of two is challenging, but they also have the most means and likelihood of being able to do that. if once you get these small penny stocks once they go below an m never one like how do you restart those engines it's tricky um but uh you know that's i think that's one element but i also think that part of this whole story is actually just derivatives as well uh as the market matures that is i mean the least discussed but i think most important thing since the etfs there's a market structure shift has been these ibit options i don't think people understand how big they are

I'm doing a report as we speak on this. It's 51 cents of options leverage per dollar in iBit. Like it's exploded. It's now 57% of the trade volume for options. It's overtaken Deribit. And then it went live in November. So this is just a massive, massive, massive shift to market structure. You know, it creates more avenues for leverage.

Wall Street's going to start playing games to capture volatility. But as we know, Bitcoin has this very, very unique characteristic where it lulls everyone to sleep. And then it rips and it just moves. And that's the kind of thing where you can get a bunch of guys really offsides. And where we are right now, we're at 125 something or 124. There's a massive pool of calls,

like 350,000 contracts that are due in just October. So it's a massive, massive chunk of total open interest. These are people who've sold covered calls above the previous all-time high. They've just flipped over to being out of the money, right? so they're essentially the call the buyers of those calls are in the money so they're happy but the guys who sold those covered calls sure if the price stays here at 124 125 till the end of october that's fine they collect the premium they win but if we go to 130 or 140 and we just

keep climbing suddenly they've given up all that upside at massive scale so you'll probably see the higher that the price goes the more of those guys are going to say oh shit i shouldn't have sold that upside and start flipping and going the other direction so it's going to be a very interesting dynamic well that's one variable of many that you you highlighted in a recent report that you did in collaboration with unchained about the changing market structure and we've been touching on this during during our quarterly uh catch-ups throughout the year but i don't know i read the report went through it you seem more bullish than you have been um throughout the year you call them for 150 and i believe the report had uh some potential targets above that

yeah so i think the the dynamic is as it stands so chop consolidation has been my my meme of the year right that's been or actually meme of the cycle we've had two major phases the first one was in 24 proved we're a trillion dollar asset second one i would say all of 2025 has been one big ass chop consolidation and just for clarity when i say chop consolidation it derives its name from an index a technical indicator i call the the choppiness index and it basically looks at how much energy is in the tank for a market to keep trending short story is when the market runs really hard in either direction and it works on daily weekly monthly time frames you just hit a point of exhaustion where the market can't keep running

it's got to take a break and my definition of chop consolidation it's obviously taking the chop part, combine it with consolidation, price goes nowhere for like six, eight, 12 months. Absolutely nowhere. You close your eyes, but it's sold off. It's rallied. It's blown up. It's liquidated people like accounts of the bodies of traders are littered all over the road to get there and the price is dead flat. 2025 has more or less been that. Up until very recently, we were at 110. We had a previous all-time high in January at 110. The market's gone basically absolutely nowhere. And only in recent history, we started actually lifting off that base. That 2025 zone, here's some fun facts for it. 30% of the supply currently has a cost basis above 95K.

If you price those coins based on when they moved on chain, so really people, yes, some of us think about things in BTC terms. Most people think about it in USD terms. When you buy a big slug of Bitcoin, you're looking at the price relative to that purchase price. The dollar value is actually what people emotionally anchor to. 30% of the coins are up there, but 60% plus of the dollars that have ever been invested in Bitcoin is above 95K. This is our new home. Imagine if we go down below 95, suddenly that 60% of dollars, they're all underwater going, holy shit, did I just buy the top? You can imagine how the sentiment would shift really badly if we were below 95. However, we've now bounced, right? We're now at 125. We tried to sell off. And let me tell you,

there are plenty of signs of slowing momentum in this market. And you're right. I've been relatively cautious over the last, I would say, month or two, really since the first 125 all-time high. Somewhat cautious because I was like, why is gold ripping? Why are equities ripping? Why isn't Bitcoin ripping? And there's this idea I've been floating around recently where gold, i think tells us the future it's where we're going when all is said and done it smells out the debasement first months in advance bitcoin is much more sensitive to the near-term local liquidity so if bitcoin was showing weakness gold is ripping one interpretation what that could mean is that the path between here and where gold is is a bit weaker right where you maybe you see a

crack in the equity market maybe the ai bubble slows down whatever it is the response is going to be debasement at a monumental scale. This is the big print idea. But Bitcoin is going to show us the road to get there. Now, the fact that we're still pushing up to 125, great. And honestly, the market is now saying, I want higher. So my big picture view here is we could have gone to 95. That would have been, I think, all over for the bull. We didn't. We didn't even get below 110, which is a critical level there, short-term cost basis. And we've bounced. We did that twice. the bulls are now in control if we go back down to 110 you now have to ask yourself where the hell are the bulls what are they doing like where's your firepower so it kind of sets us up with a

really nice just framework but going back to your original question that shop consolidation we've seen in 2025 if my thesis is correct we've built an enormous base up here at two trillion we proved a trillion in 24 we've proved two trillion in 25 so now the question is how many trillions and i I mean, the most logical thing is let's go to 150. Let's see what that looks like because that's 3 trillion. But we've got this massive base, right? 60% of the dollars invested in Bitcoin have said, I want it above 95K.

That's more of a floor than it is a ceiling. So it's one of these nice binary setups and markets you've always got to hold two views at the same time. There's no excuse for the market to go down to 95 right now. We have proven that we want to go higher. The bulls are in control. if not the bulls are just weak source and it probably over for a period of time but that's not the base case because we're at 125 and it feels like we want 150 and we're coming off a

really really nice stable base you can kind of start lifting some of your targets and saying well because we've proven 110 that's the floor where do we go from here so freaks this rip of tftc was brought to you by our good friends at bitkey bitkey makes bitcoin easy to use and hard to lose. It is a hardware wallet that natively embeds into a two or three multi-sig. You have one key on the hardware wallet, one key on your mobile device, and Block stores a key in the cloud for you. This is an incredible hardware device for your friends and family, or maybe yourself who have Bitcoin on exchanges and have for a long time, but haven't taken a step to self-custody because they're worried about the complications of setting up a private public key pair, securing

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to pop and so i'm pretty sure that i called out this chart like if there's one thing in the entire bitcoin market cycle if there's one data point that says like this site is measurably different and it's important to make the distinction here when i say this time is different it is not in the financial sense of the word which is that when like the foremost dangerous words in finance this time is different is when it's ripping to the upside. And everybody is just saying new paradigm, no more bears, blah, blah, blah. That is not what I'm talking about. This time is actually different. And you can see it in this chart, we are trading in a very, very different regime. If you look in previous bull markets, Bitcoin is very commodity like volatility picks up during the upswings and

then compresses in the bear when no one cares about it. We've had this very, very compressive profile. There's a number of factors that come into this. There's derivatives, there's options, there's also just this kind of institutional bid that's under us. One thing that's been very characteristic of this cycle, if you look at spot order books, because as you would know, you can do taker or you can do maker. If you're a maker, that means you're putting in a limit order and saying, I want to buy Bitcoin below the price, or if you're a seller, I want to sell it above the current price. The taker is the one that goes across the order book and actually hits the ask or hits the bid and is actually taking liquidity out of the books. For almost

the entirety of this cycle, we've had a massive bias towards net sellers, people who are market selling into buy walls, and the price hasn't gone down more than 32% twice. There is a huge amount of liquidity that's just sitting there on the buy side, but it's not rushing to the other side of the book. It's not doing FOMO buyers. It's allowing the market to sell to them. It's a much more patient, much more conservative, sophisticated, honestly, bid side. It does. It compresses the volatility because you're not getting those crazy downswings. We're also not getting the crazy upswings, but there's this demand cushion sitting underneath the price, just accepting all the sell side. Let me tell you, there has been some tremendous sell side this cycle, tens of billions

of dollars in a month we saw 80 000 bitcoin get sold the market went down three percent and then recovered there's just all these dynamics that say that we have a very sophisticated bid side and they are they're just boring people to death right people are selling because they think oh you know bitcoin cycles over and you know we've come to the end of the four-year cycle and it's been shit i may as well get out of this position and then these like giant ball of buyers just like thank you very much keep it coming keep it coming we're just going to absorb absorb absorb and then one day it's just there's gonna be no sellers left it's just gonna rip yeah and it's it's funny to the the october meme really becoming true in the first six days of the month but then i mean

just pattern recognition of the psychology of the bitcoin market specifically like you have paul tudor jones on cnbc this morning like bitcoin's gonna rip gold's rip bitcoin's gonna rip you have a bunch of people and trad fi you had jp morgan come out and basically say we surveyed our clients and we're asking them why they're investing in particular assets when it comes to gold and bitcoin uh they're doing it because they're worried about the basement and fiscal dominance taking over and then you had muhammad el arayn come out and basically say oh like bitcoin is the debasement trade and so you sort of have this memetic power narrative power building around it at the perfect time to which by the way bitcoin has just maimed that shit into existence by the

way like we literally just said it enough times now the whole world says it's great it is and i mean it seems like the basement is on on the table i think if you look at what's happening here in the united states particularly with the economy it seems like the economic data is painting a different picture than what's actually happening behind the scenes in terms of the quality of life of most Americans that particularly don't own financial assets. You look at this push towards AI dominance and it being viewed as an arms race that we have to win. And when you factor in the amount of money that's going to need to be poured into that, it's immense. And we're seeing that manifest in the form of industrial policy being at the scale

that it probably hasn't been since World War II with the Trump administration taking stakes in chip manufacturers rare earth metal companies um pushing for uh the takeover of social media companies as well and it seems like we're definitely hitting a point here in the united states where uh the sort of combined factors of the economic backdrop and the industrial policy and goals that the trump administration wants to go after demand that that we unleash the money printers or inject stimulus into the economy one way or another and they just there's just there's only so many options that they have you know like these this is just what they have to do in many ways so it's part of that dynamic if they're trapped uh if you look at the the correlation

between like people say bitcoin's just levered nasdaq but bitcoin's the correlation between bitcoin and the nasdaq bitcoin the s&p bitcoin and gold since 2022 since the bottom of that bear market it's basically just been one so everything is just correlated to everything and this is abnormal and it's because it's all one trade it's all one trade there's just something wrong with the denominator and again gold is sniffing this out we have an inert yellow metal uh as well as a bunch of silver metals in fact i think i said on your uh pod sometime back that i was a platinum maxi uh platinum is like one of the best performing precious metals at the moment kicking ass um the market is just saying give me something that isn't cash because cash is just not

doing it for me at the moment which is it's incredible to watch no it really is i'm gonna pull up this chart i can't find the luke roman chart off the top of my hand but i know that we shared it from 10 31 this morning but just like really drives this point home like it is and it's crazy how under the radar it is for most people um especially when you consider how much bitcoin gets besmirched in the media like if you look at the s&p going back to 2020 denominated in bitcoin terms it's clapped by 88 percent uh on my deck there's two charts are probably relevant uh look at slides eight and nine uh these are both really nice visualizations like i like i think bitcoin is misunderstand gold a lot

of the time uh i like i'm like gold's my second biggest holding and i think it shows us the future It helps me understand where the Bitcoin trade is going and why it's doing what it's doing. So I think it's the next one, this one here. So I like to use gold as my benchmark. So basically, for those who are just listening, what we've basically done here is since 2022 and specifically February 2022, and the reason that I've checked that date is that's when the US froze Russia's reserves. That's the immediate signpost to say, hey, the treasury market is no longer your sovereign

savings vehicle to anybody who was listening. Now, it also, the reason I like to pick that date is it's a very important geopolitical date where the foundation has been challenged at a fundamental level. Counterparty risk has been reintroduced to the savings asset. But also, it's not cherry picking like Bitcoin's bottom and saying, look how much it outperformed. We're not cherry picking Bitcoin's top and saying, look how much it got destroyed. It has the bear market and it has the bull market that follows. And basically what I've done is everything is indexed to gold. So gold is the benchmark of one. And it's just looking at all the major fiat currencies, dollar, Mexican peso, Aussie dollar, euro, pound, whatever. They're all down 40 to 60% in gold terms. And that's

when I took these measurements, which would have been in late August. So it's down even more than that. I view gold as like the benchmark inflation rate over the long arc of time. It is the real the real inflation rate. Bitcoin is up 50% to 80%. More than that now, it is versus gold. And that includes a 55% drawdown versus gold in the 22 bear market. But if you go down to the next chart, you can just say, well, you know, fiat currencies, they're all programmed to debate. So yeah, of course, Bitcoin and gold are beating fiat currencies. Well, let's price the S&P 500, silver, TLT bonds, which is Luke Groman's favorite line. Let's price all of these in gold. And they're down 10% for silver, 24% for S&P, 65% for bonds since that same period of time. So

clearly there is something going on with these hard, scarce, sound money assets. Coins of all shapes and sizes are doing particularly well. Everything else, yeah, everything's part of the Fiat Ponzi, not so much. Well, do you think, I mean, taking into account that this time is different in the sense of the market structure and the players that are involved in the Bitcoin order books and the derivatives around them specifically? Do you think people are beginning to wake up to this? And if so, how does that change things moving forward? So here's an anecdote. I regularly track what's going on at the local bullion dealers here in Australia. Almost all one ounce gold coins are on backorder only. When I was buying platinum,

Every time I would go in, I would say, hey, is anybody buying this stuff? And they'd be like, more sellers than buyers. No one really cares. I can't find a platinum coin to save my life now. Sold out everywhere. All the gold coins are on back order. Even the silver market, right? They've got thousands of these silver coins with stupid designs on them that no one wants

to buy. Even they're starting to run out. So just the local bullion dealers are moving into back order only here in Australia. There is a clear demand. Now, what does that do to people's psyche? Once people work this out, and this is another thing that I think Bitcoin has memed into existence. Gold bugs tried forever to get fiat currency, call it what it's actually called, give it

the name. It took forever for gold bugs to even achieve any kind of acceptance of the term. Bitcoin is show up on the scene, next thing you know, everyone from Gen Z to boomers are talking about fiat currency. So we managed to just crack that egg and say, hey, there's something wrong with your denominator, it called the evil what it's called and as people work this out this is another thing i think is really interesting we're all but seeing an era where information travels much faster narratives travel very quickly through the internet there's this dynamic at play where we're just kind of

working out like what the actual trade is much much sooner so i think about this in the context of the ai boom i think there's a lot of evidence that it's a bubble i'm certainly like a little bit concerned about it because i i get there's like the industrial policy side of it but also the revenue picture of it is very very questionable but how quickly can like if you look at the dot com bubble it took a long time for people to actually work out they had many many years of this thing just going vertical and there's no question there was a you know all the fiber was laid and all that the internet was super powerful blah blah blah are we going to reach that point of the pets.com recognition moment much sooner. So if people kind of index and say, oh, it's still

1999. But what if the timeline from 1999 to 2001 isn't two years? What if it's two months? What if things just travel much, much quicker? And in my view, that's like the one thing. If there was a major risk vector for Bitcoin, I actually don't think it's internal. I think the Bitcoin market is actually quite sound, quite solid. I just think that the external factor of, hey, suddenly the AI bubble isn't quite as healthy as we thought. There's some kind of external event

that just breaks down. That's the main thing that I think is hard to analyze, hard to kind of track when those things pop, but there's enough warning signs that we should be paying at least a little bit of attention. Yeah, it's funny. I've been spending the last two days

really battling over this question internally in my own mind. um i've had geordie visser on the podcast i've been watching his weekly show and i've watched a bunch of other shows to it too and when you when you compare the ai boom to the dot-com bubble like they obviously rhyme in many other ways but then there are ways in which they don't rhyme like a dot-com era was laying broadband and there really wasn't much use for that broadband yet because nothing had been moved to the to the digital world uh in size or materially or anything that was worth um monetizing at that point in time and i guess this is what

geordie and many others are saying is that it's different in the sense that like the ai has utility from a productivity standpoint right now for whoever uses i think chat gbt has 800 weekly active users and everybody admits that there's definitely a massive misallocation of capital going uh within ai specifically it's just the question of is it as sort of catastrophic does it does the end result as catastrophic as the dot-com bubble bursting or is the signal within the capital has been allocated to ai strong enough to sort of just uh shed yourself of the bad investments and the good ones will shine not only will they shine but will produce so much productivity in advance the people leverage them so much that uh it won't be

as bad as 2000 2001 i don't know yet jerry's still out my mind but it is like one of those fascinating inflection points that we find ourselves in and trying to make decisions because this is all new to everybody who's involved um and especially when you consider like the exponential increases the productivity that that ai is is bringing the world yeah i very much agree and i think there's no question the potential is there but and again this is very very anecdotal i certainly find for me ai makes way too many mistakes like there was when i was trying to do this study on ibit options i started pulling number from because data sources in the tradfire world you'll be amazed how often they diverge you're like hang on a second i've got

5 billion from this source but i got 35 billion from this one which one is it so it's very very hard to actually reconcile this stuff so i was using ai i tried grok and chat gpt and i'm like can you just estimate for me what is the open interest for ibid options and then you do the deep think one where it actually really goes through and looks at different websites and as i'm reading through its copy it's like i'm just going to assume that there's a million contracts open and then just carries on i'm like what do you mean you're going to assume there's a million contracts open and i just send it a website like this one here says there's like 53 million contracts open oh yes you're absolutely you're absolutely right there are 53 million it's like

fuck me like do i have to check everything and i do wonder it'll get there but the mistakes it makes already i find that i'm using it less and less and that again that's just me and how i work and i like to write my own stuff anyway but even in my coding like it helps me do when i'm building up charts and things yes it can make things faster but also the amount of times it just introduces random bugs or like it wants to make a change i'm like i don't want to change anything like fuck off leave me alone and sometimes i just have to disable it because i'm like you're literally just a pain in my ass i got i didn't focus on my own work so that's just where we are at the moment so again that's not a that's not a perfect analogy to say that it's all it's not

going to work but there's still a lot of errors and i can't quite see like for me i think the ai there's a lot of similarities to bitcoin mining some examples of this uh if we look at like the subsidy and fee model for mining. They don't control their output cost, which is Bitcoin. That's the thing they produce. The subsidy is guaranteed income. The fees are volatile and based on user application. We've gone through a phase at the moment where they're training all these LLMs. That must happen. It's like a big race for building up these LLMs. That is guaranteed usage of these chips of these data centers that's the subsidy but at some point that's a very expensive exercise and those models get deployed and they have to start actually generating revenue

in people's business models in apps whatever it is over time that subsidy is probably going to have to give way to the inference side of the equation where people actually have to use ai and by using it that's your fees it has to be useful if you keep plugging stuff in and it goes oh, I'm just going to assume this legal premises. You're like, but there's no premises for this whatsoever. The more people are going to say, maybe I can't trust this thing to actually do the job I'm asking it to do. Therefore, your fee revenue goes down. It's one of those dynamics to just keep an eye on that we're just not there yet where I'm like, it's going to replace thousands and thousands and thousands of jobs. It'll certainly replace some and it is, but I'm not

necessarily convinced that we're going to see a shedding of the workforce in the next period of time. Now, that's a longer term view. That is something that probably will happen. And the sad reality that I have to balance this with, the world is a bell curve. And sadly, even with all the mistakes that AI makes, there are still a lot of people who probably are going to be replaced by the systems as they stand today, because they also make mistakes. So that's also a challenging dynamic to be aware of. But yeah, it's hard to get your head around where we are in this whole mix. it really is it's so fascinating dude i completely agree i catch it making mistakes every day we've been leaning more into the video gen stuff which has been fun but

it's uh no it's just fascinating to think through this and i wish i wasn't actually i don't wish i wasn't nine years old when uh the dot-com bubble was bursting but it would be interesting to be able to uh sort of teleport back to that point in time and try to gauge the um the sentiment correlations that are that are happening uh that were happening back then they're happening today because everybody in silicon valley and obviously on cnbc is like dead set like it's here it's happening and we're getting to the point where trillions are being ported it's like oh my gosh what uh better hope this pays off but it also highlights the relative value of bitcoin as well i mean we we talk about this a lot at 1031 like you have all these venture capital funds and

growth funds being thrown at ai and yet still bitcoin which arguably i can make the argument is more important they're a bigger total addressable market than ai because it's going to be the whole money of all the world and ai is even going to be using it still overlooked by these same investors yeah and i think one thing that i've i can't remember it was a couple of days ago you saw the headline that nvidia invested 100 billion in i think it was in open ai so that They can buy 100 billion of NVIDIA chips. And you're just like, this is some like PowerPoint plugged into itself type shit. It's starting to get a little bit circular.

And like, where have we seen this before? The crypto industry in every facet. Like we're going to fund this protocol, which is going to fund this one, which is going to put, and you just see these like loops of internal financing. And you're like, is it because you can't actually raise money anywhere else? Like, is that what's going on here? So some of those dynamics are also, you know, leverage and debt starting to creep in. and again i'm not an equity analyst i couldn't tell you where we are in this whole cycle

but also i i've come to trust my gut in markets because generally speaking that serves me well i just have this the smell test you're like hey like at some point this doesn't carry on the way it's currently going right we're getting close to some kind of climax here so freaks this report was brought to you by good friends at silent silent creates everyday fair day gear that protects your hardware. We're in Bitcoin. We have a lot of hardware that we need to secure. Your wallet emits signals that can leave you vulnerable. You want to pick up silence gear, put your hardware in that. I have a tap signer right here. I got the silent cardholder, replaced my wallet. I was using Ridge wallet because it secured against RFID signal jacking. Silent, the cardholder does

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The Bitcoin check from Unchained and Check on Chain shows how the 2023 to 2025 cycle has permanently reshaped Bitcoin's market structure. Inside, you'll find why volatility has collapsed, why ETFs have anchored new five- and six-figure price floors, and why long-term hodlers remain firmly in control. Download now, and you'll also get access to the online event featuring James Check, Bitcoin Has Crossed the Rubicon. Get the report at unchained.com slash tftc. That's unchained.com slash tftc. I'm bringing this back to Bitcoin, I think, going back to Paul Tudor Jones' comments. And actually, I've been recording – I've recorded twice with Michael Howell from Cross Border Capital and his whole thesis is we have these liquidity cycles that are dictated by the duration of treasury bonds and other debt instruments. And he was saying two months ago that we probably have six to nine months left in this liquidity cycle.

So I mean, four to seven months left from from this point forward. And then you had Paul Tudor Jones saying, like, from here to the end of the year, it's a big melt up. And so that's I can feel like the 17 to 2017 vibes coming back in terms of the speculative fervor, not only around Bitcoin, but all assets. yes no and that's one of the real challenges right you've got all these competing forces and i was listening to brandon quittem talking with with danny the other day the whole fourth turning idea you've got like the long-term debt cycle you've got the social structures that are the institutions that are weak you've got all these things coalescing at the same time liquidity cycle debt refinancing social cohesion uh you know uh politics all of it is just a real melting pot

with like there's not that many stable things when you look around and actually i was going back to gold i was talking to my old man so he's retired and he has to have these assets somewhere and he was uh he's now properly convinced and he understands the gold trade but i've been saying gold for years for years and years and years and he finally started to catch on so i get it he's now understands the bitcoin and the gold trade but he was like why gold and i was like because if you look around the world there's instability everywhere you go everywhere you look, there's just stuff that's going wrong. And I said, do you know what a shelling point is? And he goes, no. And I said, we're in Paris. And I say, I'm going to meet you at midday. Where are

you going to be? And he goes, the Eiffel Tower. So of course you're going to be, that's the shelling point. So when the world is in just a real pretzel and no one really knows how to, where do I put my money? And he was saying that he went out for like a golfing weekend with some of his mates. And he asked, how many of you guys know what's in your, we call it superannuation, in your 401k how many of you guys know what's in your 401k they're all retired and he goes none of them had a single clue what was in what they'd invested in they had no idea and it's like what are your fees they're like i don't know i've never checked this is kind of where a lot of people are so if you come back to that view when people start to finally click and go i'm struggling to retire

and the things i own yeah sure i'm getting six percent eight percent a year but my bread just went up 25% in three years. Something's wrong. I'm not earning enough to stay solvent. What are they going to do? They're going to look around like gold is just that shelling point where people go, I get it. You don't have to explain gold to anyone. They just understand that it's valuable because it's gold. It's as simple as it gets. That's the dynamic, I think, why gold makes sense. I think Bitcoin, it's just, I mean, gold's just got the size and the scale and central banks and all that. But Bitcoin is the only other asset that has even a remote potential to achieve that. And I was talking about this the other day. Once Bitcoin, I mean, it's already at 10% of the gold

market cap. And by the way, the gold market cap going up is just raising the ceiling for where Bitcoin's going. It's just lifting up where that target is. As more people start to click that these two things are synonymous, and in a way, again, Bitcoin has kind of memed that with digital gold. Call it an affinity scam if you want, but we've basically associated ourselves with the only other asset that's kicking ass. People are going to start saying, well, maybe if it's 10%, what happens if Bitcoin goes to 20% of the gold market cap? Once you're at 20, go to 50. And once you're at 50, let's go the whole way. If you can prove that you're at 50%, go the whole way. Because if the market's willing to support that kind of evaluation, then why wouldn't it go higher than

that yeah no i think this is a really important topic to dive into because i remember back in geez um like the first time the sort of bitcoin to gold parity targets are being set out there i think the first time if i remember correctly it was like bitcoin 336 000 that's when it reaches parity with gold then like 2017 21 750 000 now it's like 1.8 million and i think in terms of market cap that's what people really don't realize gold's up what 40 this year it's adding literally trillions of dollars to its market cap on a somewhat daily basis at this point and that's i think we're talking about like orders of magnitude that you're climbing up gold's obviously uh been the target for some time but even the target it's like a moving target that's

drifting higher as it appreciates and more people uh accumulate that but the gold has added tens of trillions to its market cap very quietly and like in bitcoin sitting at a two and a half trillion dollar market cap it would be basically insane to think that that could happen in the timeline that it's happened with gold but i think that stat alone highlights how early we are with bitcoin the fact that gold is quietly at it i believe over 25 trillion to market cap and crazy it was like it was 25 trillion you know uh i think it started the year somewhere around 25 and i think if you go back to like the the run here really started in 23 from memory uh and if you go back 22 i'm pretty sure it's like 7 trillion at the start of that 2020 run so it's basically added

20 trillion dollars right 10 bitcoins worth of value in the span of like three years and i i really believe this is very much a um elephant through a keyhole type idea where you've like if you look i saw a sentiment poll um recently and it basically showed the allocation that institutional investors have to gold and like 45 or 50 percent of them had less than one percent allocation and you're like no one owns this thing and even like the upper bound was like four percent most institutional investors have no allocation to gold very very small and then you look at their bitcoin position it's even smaller i ran a study it's a little bit outdated now but it would have been in the first like two or three quarterly cycles of the etfs going live something like

20% of the ETFs were held by institutions. And the vast, vast, vast majority of these firms had like 0.0001% allocated to Bitcoin or the AUM. Now that 0.0001% was like tens to hundreds of millions of dollars. It was infant, like tiny portfolio allocation, massive dollars. And you're just like, what happens if they go to 0.002, 0.003, 0.1? Suddenly you're getting like a 10x now we're talking about billions of dollars coming in elephants through a keyhole at some point like there really is just so much capital that has to find a home and it just takes time it takes time for the market to work out there's something wrong with my denominator and i got to go looking for an alternative yeah i think that's bringing it back to like fourth turning

i know this time's not different in terms of uh if we get to like new breakout all-time highs and it's like the new paradigm super cycles here but it's fascinating you had germany come out today and saying they want to raise the retirement age to 72 to make sure that they can pay out their pensioners trump flippantly just like offhand comment two weeks ago um posited the same thing here let's let's raise the age to 67 uh and i don't know if you're seeing it over in australia i'm sure you've seen the tiktok videos from over here in the united states people are in the cars talking about health insurance premiums going up like 50 on average across the board here in the united

states uh this year we have the open enrollment window which just opened up uh at the beginning of this month and will be open till the end of january and people get to pick their health care plans there and i think on average across the united states the the sort of premium is going up anywhere from 25 to 60 percent and the cost is getting way out of hand people are intuitively understanding that something has gone off the rails and like at what point do they force their politicians or wealth managers or rias to say hey you need to get into these hard assets the math is funny it's funny and then it's like i uh i mentioned to you before we hit record i moved to a new area i was at a little cocktail party on friday night and met a gentleman who

runs a big ria book here in the united states and he like sort of like pulled me aside i was like i need you to teach me about bitcoin like i don't i don't know much about it anytime somebody's pitched it to me it seems like too good to be true but it's like dude you manage billions of dollars and you don't have a grasp on bitcoin yet that's not yep i didn't say it to him and hope he doesn't listen to this. But if you are listening to this, we need to sit down and talk because it's not okay. But it's also getting to the point where people are asking those questions. And that's, again, a very, very big difference. I've successfully orange-pilled four or five different people this cycle, but I don't go out of my way anymore to orange-pill people. If they've

got questions, I've got infinite time. But the way I would characterize the folks who have actually come to me with questions, people who actually have wealth. They've got some kind of serious there's family wealth behind them. They're looking around and going, there's something wrong here. I don't really want to keep investing like real estate's illiquid and there's certain risks with those depending on where you live. There's just all these things people go, you know what, maybe I actually need to look into something that is scarce, liquid, and just I can hands off. I don't have to think about it anymore. So that's the kind of dynamic. I think the kind of the high net worth individual, also the retirees. One of our plans that we have at Check and Change is our

orange plan disproportionately retirees who have a you know meaningful amount of wealth and they're now looking ahead and saying well i need to buy myself some runway but i also really understand bitcoin trying to find that balance between like i don't really want to sell all of it but i kind of need to sell some of it or i need to you know find some kind of liquidity somewhere but that dynamic of the type of investor who is now coming into bitcoin and staying here that is a really really different dynamic i think a lot of people have missed we're not in that like millennial hodler phase anymore. And of those millennial hodlers, I think a lot of this, like people say, well, why would you sell your Bitcoin? This is a topic that I like to talk about because one sold

Bitcoin is one bought Bitcoin. It's actually a measurement of demand. But there's a lot of people like you and I who are at that phase where they've got kids, they need a house, they've made a bunch of money, they kind of need liquidity to like improve their life and live because that's kind of more important than your Bitcoin. That's another phase I think is misunderstood. People sell because they just have life requirements that are more important than number go up right because lifestyle go up is just more valuable so i think that's another component that is a worth worth tracking agreed with that in mind i mean the what what are you seeing on chain like talking about new market dynamics new drivers um for liquidity in the market and new buyers and

sellers, what are the levels that are sticking out to you now that we cross over a new all-time high? Yes. It's easier to illustrate on the downside because on the downside, the real risk is 95. 95 is a level that we don't want to hit. Honestly, we go back down to 110, you're like, why? Why did we go there? We have no place being there. I was describing that whole block, that 60% of all the dollars invested, I call it the hodler's wall, because that zone is super, super, like just so many coins are there, so many cost bases are there, it's where our sentiment lives. We don't want to go below that. Now on the buy side and the upside, this is where things start to get really interesting. I think there's a chart, I think I can see in the background there,

this chart with waves. There's two arguments that I think should be put to bed. The first one that tradfire guys love to put in the put out there is that sailor has been the only buyer in this market and it's just measurably false there's no way the numbers simply aren't big enough for sailor to be the only buyer uh if you flick down to so actually we should come back to this chart there's another one at i think it's slide 21 um uh so if we look at the overall you know keep going keep going keep going i think it's after this next one this one no although this one's also useful let's just start here first things first um the most bullish metric of all time in bitcoin the realized cap the realized cap i just want to pause here because it's actually really important it explains the

next chart the realized cap prices every coin when they last moved on chain so the coins that you bought back in 2019 or 2013, if you still hold those UTXOs, it's saved at that price point. And the reason why I like this is it represents our, as investors, as Bitcoiners, this is our proof of work. This is the money that we earned in our fiat job, and we gave to Bitcoin to look after, right? It's when we allocated it. It just crossed a trillion dollars. So Bitcoin's a two and a half trillion dollar market cap. We have collectively allocated a trillion dollars in our hard-earned savings to this thing to look after. And by the same token, we're now sitting on $1.5 trillion of unrealized profit. Just let that sit with you for a second. Bitcoin is sitting on a

$1.5 trillion of unrealized profit. Berkshire Hathaway's market cap is a trillion. So we've got an additional half trillion worth of just profit relative to Rat Poison Squared's market cap. Kind of tough. Anyway, so go down to the next chart. I think this is a really good one to understand the supply and demand balance. So I mentioned that it is impossible for Saylor to be the only buyer in this market. So that's the first thing I want to put to bed. For those who are listening, the chart we're looking at here, so the realized cap is like the on-chain market cap. If you buy a coin at 10K and you sell it at 100K, someone had to come in with an additional $90,000 to buy that coin. So it's really representing a capital inflow. And likewise, if you buy the top

and sell the bottom, you've destroyed capital. So your realized cap is going to increase and decrease as we all do this in aggregate. So if you look at the 30-day change of the realized cap, the best way to think about this is capital flows. It is profit taken by one guy, but new demand by another guy. Newton's third law, equal and opposite forces. So if you look at the orange curve, we see these massive waves in the 2024 peak in March, in the January, November, January of this year, November of last year. We're talking about $70 billion, $80 billion, $100 billion a month in profit-taking, but that's also demand. Profit-taking and demand, they're synonymous. There's two narratives that go to bed. The first one, the purple, the dark purple you can see

there is Saylor. It's just so much smaller than the amount of aggregate demand. There is so much more demand than Saylor. Very rarely is his buying more than 10% to 15% at most of the overall demand profile. It is literally impossible for Saylor to be the only buyer because you're missing 85%. Now, there's about 20%. The green zone is looking at the flows into the ETFs. This is how much coin the ETFs are buying. This puts to get bed another narrative that a lot of people have missed. They just say that it's not really profit-taking. No one's actually taking profit. They're just rotating into the ETFs. The ETFs are five to six times, sorry, the profit-taking is five to six times larger than the ETF flows. It's impossible. It is impossible for all of those

coins that are taking profit, so to speak, at the top are just rotating into the ETFs. The ETFs should be 10 times bigger for that to make sense. It just doesn't make sense. So I think those two narratives can be cleanly put to bed. Now, when I talk about sell side, in my opinion, it's super bullish like it is the most bullish thing that's happened this cycle 55 to 65 billion dollars a month in july and august of net sell side and the market went down 12 and has just rallied to all time highs that is 55 to 65 billion dollars a month of demand that all the bears just aren't quite understanding is sitting underneath us so yes there's a lot of sell side and i'm actually i'm running reporters as we speak the average age of coins that are being spent this cycle

is much much larger than previous cycles and trending higher we are seeing a lot more old coins whales ogs like actual serious old money lots more of it is coming back to market this cycle like significantly more than any previous cycle and it's sustained and it's been going on since mid 2024 so that's an important thing to note and we've barely pulled back 32 percent you know what i mean like the demand profile of who is coming in it's institutional in scale if you look at the the actual uh the mempool we have very very few like the mempool's almost empty we don't have as many transactions but the volume the on-chain volume is like almost at all-time high so what does that tell you you've got few transactions but it's almost all-time high volume big money

we have huge pools of capital what we don't have this cycle is retail at all and i talk about this in terms of Bitcoiners as well. If you look at the 90-day change of all of the balances held in like UTXOs under 1 BTC, so the shrimp cohort, we've been in net distribution since 2023. The overall balance of small retail holders has been decreasing persistently since 2023.

So there's a lot of SatStackers out there who are also taking profit, which is just, that's just part of the handing of the baton, right? We are seeing a major change in Bitcoin's ownership structure. well and that's one thing i worry or not worry i wonder with this cycle too many people anchoring back to 2017 and 2021 specifically and saying retail's not here retail's not here and i'm sitting back thinking i don't think retail's coming this like i don't think retail has the money i don't think they have the money to come i think that's true and also you actually don't

want retail to come because they come like sorry and i'll say there's two ways to think about this you do want retail to come because you don't want wall street to be the only player in the market So that's the more sovereign side of the equation. But you don't want dumb retail to come because that means it's over. So you kind of want to balance your views. Like if you're waiting for retail to come, that means it's actually finished. It's all over. So I also just think that Bitcoin is a big enough market that you kind of need institutional

money to move this thing now. It's just the nature of being a very large multi-trillion dollar asset. Retail just don't really move the needle. They're a small factor. but even so after all these years shrimp only have like five percent of the btc you know they're a very very small component sailors got whatever was it three percent something like that um you know one entity versus all of the shrimp comparable yeah what are some of the sort of events or entrance into the market that you're keeping an eye out for in the coming months that would that

would signal that things have not only changed but are changing massively are you expecting nation states are you expecting normalization of uh ripping cash flows into a bitcoin treasury for profitable businesses um i think the last time we talked was right after figma uh filed their s9 or excuse me their s1 uh to go public and we were made aware that they had 70 million in ibit and they intended to buy 30 million of spot btc as well um what are some of the sort of sticky demand drivers that you're looking out for that we haven't talked about yet obviously we got etfs treasury companies um family offices and high numbers of individuals but is there anybody else i mean no one specifically i just think that we're

watching a modern bitcoin cycle and we've got to come into this thing recognizing that things have changed right it is measurably different um there's still going to be cycles we're still going to have peaks and we're going to have troughs. But as we've seen so far, those peaks and troughs, they have a very different character. The volatility profile is very different. The derivatives landscape is evolving. As an analyst, for me, this is awesome because I'm watching Bitcoin grow up and mature. And there's all these different facets, right? Yes, I'm known for the on-chain side of the equation, but that's really just the substrate that stitches all these things together. It's like it's the settlement layer between all of these different vehicles. And

really, you've got to analyze and study all of these components. It's not as simple as just looking at old metrics and saying, oh, it's got to get to this height now. It's got to get to this level or it hasn't hit that level. I think a lot of people are going to hang on to old ideas way too long. I also think people are going to throw out things at work because they're like, oh, it's a new cycle now that's broken. They're going to throw stuff out too quickly and they're going to hang on to stuff too late. For me, that's exciting because we get to live in this very, very new modern idea of like be flexible allow the market to tell you where it wants to go look at what the etfs are doing look at what treasury companies are doing look at what

sovereigns are doing like there's a whole bunch of different angles here that we've got to study and it's just all information like for me some people look at metrics and they go oh this metric has to do this but to me it's information tell me about the profit of investors where's the supply dynamics how many coins are and aren't moving what's the average age of them all of this stuff just helps you understand who the buyers are, who the sellers are. One thing we've seen that's very different this cycle, in 2017 and 21, if you look at long-term holder supply, it was basically one big sell-side event. The bull was just one big sell-as-you-go-up type thing. We've had three waves already of that, and we saw that in that chart before. Massive sell-side in 24,

but then what was really interesting is long-term supply recovered, almost back to its high. Then we had the second wave of sell side in November, December, long term hold of supply recovered. We're having the second or the third wave of net sell side as we speak. But here's the thing that it's telling you, on the way down for long term supply, so prices up, supplies down, that's telling you a story about the sellers, lots of sell side. But then the recovery is telling us about the buy side, who bought those coins five months ago, they are hanging on to them. So that's one thing that's very different this cycle. We are not seeing this like, I'm going to exit my Bitcoin position because Bitcoin's overvalued. I'm taking profit because I've got to do X, Y,

and Z, or my firm has to do it, or I need to retire or whatever it is. I'm going to take my profit. But then the buyer's like, hey, I really want to own this thing, stick it in my vault and sit tight, whether it's ETF or spot, doesn't matter. So that's a dynamic that's very, very different we have this buy side that is willing to buy at 100k at 110k 95k and put it in the vault and sit tight that is a very very different dynamic that we've seen that in previous cycles but not only with the hardcore hodlers now it's a bit more mainstream the hodl idea is much more mainstream i think people give a credit for and that's super bullish and do you think there's been made easier by derivatives. So the institutions get in, buy, and then hedge out.

Yeah. Derivatives getting bigger, yes, it massively changes market structure, but it gives them an opportunity to buy in the first place because they can hedge risk. And when they can hedge risk, they can take the risk in the first place. So it actually enables big money to come in. It's a natural part of market structure. There's no question it changes volatility profiles and you can call it paper Bitcoin and whatever else, but it also enables the the initial buy side you had that chart up before that was looking at the cash and carry trade we saw the etf flows and cme open interest trade alongside each other now we're seeing ibit open interest trading much the same with um uh with what's going on with the etf flows so

covered calls and i mentioned before at 123k there's an enormous call wall people who've sold covered calls at that zone but you can see how these things move together and what's really interesting. If you go back to pre-November last year, it doesn't matter what ETF you buy in order to put on a buy spot, sell the future on the CME. It doesn't matter which ETF you buy because they all track the Bitcoin price. So up until November, all of the ETFs were growing at the same rate. We saw FBTC growing, even the small ones. It was a Pareto distribution, but iBIT had some advantage, but it wasn't just like tearing away. If we look at it since November, iBIT as of today just crossed over 58% of the overall

AUM dominance, flows into all the ETFs except iBIT, are flat for the last basically year, and iBIT is just tearing away. Now we're seeing that the iBIT options are the preferred vehicle for pretty much all these trades. futures volume and futures open interest is kind of stagnant across like binance and cme cme's down binance is flat since november bybit is flat since november we haven't seen that much growth in futures and they used to be like the lion's share of trade volume options absolutely parabolic in every single metric you look at just straight parabolic so this is now the thing that is in

my opinion the most under-discussed biggest change to market structure since the etfs went live themselves the fact that ibit options surpassed deribit as quickly as they did is kind of mind blowing oh totally and deribit's been the market leader like 95 dominance forever yeah and i guess let's tell you mentioned paper bitcoin summer but james wall street's going to take over bitcoin price suppression is on the way so that's what's right now right now we've just seen a bunch of guys with covered calls at 123k suddenly go hang on a second we're at 125 did i sell too much upside now for those who aren't familiar with options when you sell an option you're basically if you sell a call option you're basically selling the upside above that strike price so you do collect

an insurance premium. So if the price goes to 123 or 124, 125 and stays there for all of October, you actually win because the insurance premium that you collected for selling that covered call will more than offset your losses, generally speaking. If on the other hand, we go to 130 or 140 and the bulls really are in control and we start moving, all these guys are going to say, whoa, hang on a second. I got my $600 worth of insurance premium, but I just missed out on $25,000 worth of upside. Maybe I shouldn't do that again, right? And more people will come in. But these options, the way that options dynamics play out, same as futures. If you've got a very large liquidation level, let's just say at 125K, let's say there's a giant guy who sold all these

contracts, it may be easier for him to lean on the spot market because it's smaller than the futures market. Sometimes it's easier for them to lean on spot in order to keep their futures position alive. But we have to remember this paper Bitcoin summer, the bulls have the same artillery. They have the same leverage in play. And all the guys who've written those call options, there's a bunch of guys who bought those call options, and they want it to go to 130, 140. So paper Bitcoin summer in many ways, it works on both sides of the ledger. Both teams have the same weaponry. And it's like in many ways, if I had to predict what goes on from here on, if we go down to 110 i think the bull market's over because we just have no place being down

there that's my like i think it deteriorates quickly below that that's not my base case my base case is i think we're heading higher if we're heading higher i think the era of chop consolidation as we know it is probably going to take a back seat because i think we now enter the proper euphoria phase if we get proper legs from here i think it's off to the races and my base case that we probably get more corrections like actual proper sell-offs that make people shit themselves and go oh damn it's over and then it springboards higher again so i suspect we actually move into a more volatile regime that's going to bring more options traders in the more options traders who come in the more they have to buy the underlying to sell the covered calls like suddenly

you actually get more liquidity more demand more inflows all of this assumes that you know we don't in an ai bubble that implodes and just nukes everything but my base case is that we actually move into a much more volatile environment moving forward exactly this chart dead on i can't stop thinking about this chart and when money dies well like when money like if you haven't read when money dies go back you only have to read like a few pages of it when they're talking about every paper boy was trading stocks and thought they were wealthy on pay uh like they thought they were wealthy but they didn't realize that the denominator was getting blown out like it feels like we're living through that now and to your point about increased volatility like this

could be what the bitcoin price chart or the return chart looks like over the next i mean this is a a 10-year chart like this can be compressed to a year two years moving forward from here in the age of the internet yeah so i i personally think volatility is mispriced when i say volatility is mispriced it basically means a bunch of people who've got very very comfortable with that chart we looked at earlier vol just goes sideways markets lulled to sleep oh we've tamed bitcoin right we've tamed a wild horse next thing you know volatility comes ripping back and it just blows people's socks off and you know remember options are 100 to 111 so when shit happens it happens in a really big way so to me it's gonna be pretty like it's pretty exciting i'm looking

forward to this next phase where it can kind of remind everyone how you haven't tamed me just yet yeah all right what's your adjusted uh upside potential here so my i think it was january pretty sure it was january i wrote a piece that was basically saying if we had a so this is where we've rallied to 100 100k i think we might have tagged 110 and i basically was looking at the amount of capital that we see come in per unit of market cap change and my case back then was i don't know if we have the real capital inflows yet to justify going to 150 so if we go into a different universe where bitcoin had gone in january and february this year let's say it had gone from 110 and had to reach 150 i think we would have come back down to this 90k region i

think it would have been a major top big correction probably would have looked much the same in many ways like chopped around and then away we go again but i don't think we were ready for 150 and my base case was i think the etfs approximately have to double in aum and then we probably justify 150 well in that process if you take the etfs and sailor just those two entities which really are just like net buyers we now have that doubling so personally i think we belong at 150 i think like the difference is i think we go to 150 i think we stay there that's the big difference now obviously it'll correct and consolidate and chop around but i think bitcoin deserves a three trillion market cap and i think the market's going to keep saying well how many more trillions

if you get up to 160 180 200 possible for sure but also we're really on like the there's low probability of it happening we're in the like sub 10 sub 5 of all trading days markets are mean reverting and the thing about chop consolidation when you're doing a mean reversion model and that's what i base a lot of my stuff on it's like how high do we have to go before the average Bitcoiner is in so much profit that they have literally sold in every previous cycle. The sell side we looked at before, it was always because we hit some meaningful deviation

away from the mean. And the mean is some cost basis, whatever it is, 200-day moving average, you pick it. If we get to 200K, just about every mean reversion model is stretched into the far right tail. It's just like improbable events. Happens during euphoric bulls,

unlikely we stay there. 150 is kind of like it's medium heated it's yeah we'll probably get some vol there it'll chop around but like we're not overheated we're just toasty so that's how i'm thinking about things at the moment i think we deserve 150 i think a lot of people are going to look at it and go well all these metrics are overblown again but what if it keeps going and then they're going to buy the top and then it's going to sell back down you know i'm excited for that phase because i think volatility is going to come back in we're in that late phase of the bull but is this bull a little bit different, right?

Are we just going to keep stair-stepping higher, but with a bit more vol? Take some time for the market to adjust, but it's exciting times. It really is. I know we've got to wrap up here. You mentioned it earlier. What are the metrics that people aren't going to throw away

that probably they should throw away and not focus on this time around? Good question. So I think a lot of people like to look at MVRV, and MVRV is a very powerful tool. The realized price is one model that I think a lot of people look at. it's the average cost basis for all btc in the supply includes satoshi includes early miners

all that stuff now it's currently trading if i haven't checked it for a while i think it's like 155k something like that we have gone below that in every single previous bear market everyone i don't think that happens anymore so i'm going to put it out there i think there's a new model that uh dave puell and i developed in coin time economics called the true market mean now the true market mean uh basically we we filter out or we process and get rid of the satoshi era coins the early miners people who just don't spend their coins are long lost to history and the reason why this is important in order to be at the break-even level which is like where the average bitcoiner is not bitcoin the average bitcoiner satoshi can't respond well

no, I shouldn't say can't, probably won't respond to a ripping bull market. Lost coins can't really respond to a bull market. But the guy who bought the top can. He's going to sell, he's going to buy, he's going to trade in and out. So the true market mean is currently about 80K. That's where I think if we have some kind of a bear market,

not necessarily at 80, but wherever that true market mean is, that's where I think we start to bottom out. And the reason is that that's currently the average cost basis for active investors. Saylor is at 75. The ETFs are at 80. There's like four or five different levels,

all coincident with that price model. So I think a lot of people are going to expect that we go down to the realized price in the bear, and I think that's too bearish. I just don't think we have that kind of a drawdown potential these days. If we rip to the upside, right, these models will all drift higher. But I just don't think that looking for the same thresholds to the upside,

the same thresholds to the downside, in my view look at the incentive how much profit are people in look at the result are they taking profit are they fearful are they actually taking losses are they not this is where i live and i love it i think it's great and quite frankly bitcoin has tell you the answer when you see people capitulating and like just panicking get me out at any price bear market when you see a couple of top buyers get flushed out and then the market rebounds you flush out the top buyers away here we go. So there's these very distinct character shifts that we see. So look at these metrics more as information, less as it's going to hit this level. Get rid of that kind of very

basic horizontal line. You're looking at incentives. It's all about incentives and then the actions and reactions to it. I love that. Thank you for starting your day with us. It's Tuesday where you are. It is. is monday night where i am i'm losing my voice and uh this is a great check-in i can't wait to do the next one which should be the beginning of next year and i'm sure a lot is going to happen between now and then so it should be a a pretty fun catch-up in in january so let's i think we at least tag 150 between now and then at least you heard it here first 150 i think i think it's uh I think it's written into Destiny already, 150.

It could be at 150 by the end of the week. Who knows? It could be. No, it could be. Again, this is not a special call here, right? It's literally 25 grand, which is, you know, was it 12.5% move or 20% move? Let's go.

Yeah. I'm not calling for 150 by the end of the week. But I think the one thing that is clear is that we've entered a new market dynamic. People are waking up to the debasement trade. that are waking up to the fact that bitcoin is scarce comparing it to gold saying why if it is digital gold where can it be i think people are the obviously we're here we've woken up to bitcoin but i do think we are at this incredible inflection point where people are beginning to take it more seriously than they ever have which is important part of the process

should be expected but don't get over your skis don't get uh too greedy make sure you have cash cash flow most importantly and you're able to stay alive and that's why we bring james back every quarter because you are check the analysts at least is very level-headed making sure that we're all staying in line and not getting over our skis and the most sage advice of all time is just stay humble and stack sats you really don't have to deviate too far away from that plan the rest is just managing your own mental state making sure that you're never confused by why things are happening never be a deer in the headlights like that's that's if i can if i can help people not be a deer in the headlights whether we go to the moon or we go to doom

that is essentially what i like that's what i love doing i like helping people just go why did bitcoin do what it did i don't care that it's up at 150k because i'm not a seller i don't care that went to 75 because i'm also i'm a buyer i just don't care but i want to know why because if i understand why it makes it so much easier to dig through and just get rid of all the noise that you see in narratives and just focus on what's really going on because it's fascinating it really is if you want to download uh this full report you can go to unchained.com slash tftc if you want to read through it yourself throw it into an lom see if that lom is hallucinating um you're absolutely right go check that out there james thank you and congratulations uh

thank you for your of your new child since last time we uh we met and it's a big thing And likewise. Welcome to the Bitcoin dad club. It's a fun one. Yes, I've always thought someone should do like, because there's all these things, like how do you deal with kids and AI, right? Bitcoin is going to be the ones

who we're trying to pioneer. Like, how do you do this stuff right? How do you teach them the right tools? There's scope out there for all these Bitcoin dads and moms to just like, how do we do it? Like, there's going to be problems and challenges, but like, how do we as Bitcoiners

navigate this parenting thing? Because it's weird for us. It's going to be bloody weird for them. It's definitely a double-edged sword. Me and the boys, we've had some fun with AI, purely for learning reasons. If they ever have a question, it's like, okay, let's explore this. We see a mushroom, a random mushroom, while we're walking. All right, let's take a picture.

Let's see what it is. Yeah, there's definitely going to be a whole new sort of niche carved out of child AI that is safe for children. AI literacy. Yeah. i'm actually joining it that reminds me i need to send an email joining a task force for ai at my at my child's school so i need to make sure that they're doing it right get involved good man no that's good stuff that's what you need to do and i can't there's been a few podcasts i've heard people saying this like we as bitcoiners we've got to make a positive change you know like

if you just win and walk away what's the point the whole idea is to try and make the best change you can within your sphere of influence yeah go forth and make some good change be a good influence in the world and stay humble stack stats peace and love freaks okay thank you for listening to this episode of tftc if you've made it this far i imagine you got some value out of the episode if so please share it far and wide with your friends and family we're looking to get the word out there also wherever you're listening whether that's youtube apple spotify make sure you like and subscribe to the show and if you can leave a rating on the podcasting platforms that goes a long way last but not least if you want to get these episodes a day early and

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