TFTC: A Bitcoin Podcast - Ten31 Timestamp: Just Add a Zero

Starting point is 00:00:00 John, we missed a week. Memorial Day really threw a wrench in our scheduling and we couldn't make it up Tuesday, so we're back. Yeah, it's a real shame. We brought shame on our households relative to your unbroken streak with Odell on RHR. Maybe we'll start our streak today, going forward. Yeah, we had a Friday RHR last week. Matt's feeling a little bearish. I feel I feel like he's a little bearish right now, which is usually a good sign for for the near term prospects of the Bitcoin price, though we have drifted a bit lower since we've recorded on Friday, currently below 72,000. But I think Bitcoin's in an interesting spot. We're going to, I think, end this conversation on the fundamental value prop of Bitcoin and some developments that have happened in recent weeks. But first, I think jumping right into it, just talking about the mimetic power of this administration.

Starting point is 00:00:54 And you wanted to start off this week's presentation with the juxtaposition of President Trump and Jerome Powell from last year's audit of the building of the new Federal Reserve building and Secretary of Assent presenting the $250 bill with President Trump on it. Yeah, look, I mean, this guy, you know, much can be said about him, positive and negative. And, you know, we don't have time to get into all that. But I think the one thing that we all have to agree on is that Trump across his two administrations is responsible for some of the most iconic images of the storied history of this great country. And, you know, the one on the right, the Besson image is what I led off the week with just because I think it's so it's so perfectly captures the moment and also the contrast between what happened last year with his iconic image of Trump and Powell, which I think is probably the number one image that Trump will ever produce. I mean, I just I don't think you can get better than than this. But a strong number two is this one with Besson holding up his $250 bill. You know, you've got larger currency denominations, right, with people struggling with price inflation. That's always a good sign.

Starting point is 00:02:02 You've got the Treasury secretary taking the diametric opposite stance relative to to his former counterpart of the Fed as it relates to Trump. you know clearly uh with this this this wonderful grin showing uh trump trump's image on on the currency um you know i think tells you a lot where we're going tells you a lot about where the different camps sit and uh yeah i just think this picture's worth a thousand words and i'll let it speak for itself yeah when i get to i mean we just did some pre-show prep more more pre-show prep than we than we typically do and i think what i'm picking up is that the underlying theme of this discussion is going to be the acceleration of the k-shaped economy and how how we navigate that moving forward because it seems very clear that there is some dislocation

Starting point is 00:02:45 between ai the plays within ai and everything else and um it's just really interesting times that we live in but sticking on geopolitics and the trump administration i think one thing that's become clear over the last week that a lot of the the price action that we've seen in oil markets It's like going below 100 and staying in the mid 80s for the last few weeks has been manufactured price due to the fact that many nations are draining their strategic petroleum reserve as an attempt to route around the supply disruptions because of the closure of the Strait of Hormuz. Yeah. And I think this relates to the K-shaped economy as well, right, where we're all – those of us who have the need to actually be aware of what gas prices are certainly have felt in the last six months the impact of all the disruptions in a way that perhaps those at the top of the pyramid haven't quite as much. But it hasn't been completely unbearable yet, and I think there's a decent amount of confusion as to why we haven't blown out further. There's been speculation about this, and we've talked about it a little bit on the show, but Rory Johnston, who's a great oil analyst that everyone should follow, had some good data out highlighting that there's some incongruity in the Chinese data that they follow, suggesting that you've had imports come, oil imports come way down, but also mobility indicators that they follow are still strong. So like you're not really seeing demand destruction.

Starting point is 00:04:11 And he thinks that the delta there is getting backfilled by the Chinese effectively just making massive withdrawals from their petroleum reserve. He's kind of interpolating that. He doesn't have great data to that point, but it stands to reason. And of course, you know, they're they're certainly not alone. All the cool kids are doing it. And we're seeing it in the U.S. Last week, we just had our second highest SPR draw on record, surpassing the ones from 2022. into highest was the prior week. And then, you know, Japan also is running the same playbook here. And so this is keeping us, you know, keeping a relative lid on oil prices. You know, it hurts, but it's not it's not destructive yet for many sectors of the economy. It's not probably

Starting point is 00:04:53 it's getting to be a voting issue in the U.S., but it's not necessarily a rioting issue yet. But, you know, the question is that when you think about stocks and flows like these are all stocks, right? And you deplete them without re-upping them. You can only do that so many times. And you can't even get them down to actually zero. You need to keep some level of stock in for the SPR to actually work chemically and function the way that it should. So the question is, how many more times can we run that playbook before you start actually getting more meaningful getting in the street type impacts on the oil price? Yeah. And I think last week was rather interesting as it pertains to this particular theme because you had the ceos of chevron and

Starting point is 00:05:35 exxon come out and basically call bs saying hey these these prices are artificially manufactured what we're looking at looks like the prices should increase throughout the summer maybe getting back to the 150 to 160 dollar per barrel range and i mean i was following wti this morning looks like it popped above 91 from from 85 over the weekend i wouldn't be surprised if that's the market digesting to CEOs at two of the largest major oil producers in the world calling BS on this. Yeah. The DJ in me looks at this chart and wants to call a lower high there. Um, but I won't, I won't, uh, make any bets to that effect, but yeah, look, this is obviously, you know, we've talked about it for the last like three or four months. Like this is kind of the,

Starting point is 00:06:18 the, the crux of the whole thing, right. Is, is who, who blinks first, who can, you know, maintain enough stability in core input prices to their economies to not have to back off and to maintain leverage in this whole U.S. and China, you know, via Iran type of standoff that we're looking at. And it's TBD, right? The Achilles heel over in the U.S. is that this has, when this price gets out of hand, you know, that has direct and meaningful impacts, not just for voters who can ultimately in November potentially constrain Trump's agenda, but also more significantly and more immediately for your bond yields, which flows through everything else. So in a hyper hyper financialized, over financialized economy, we've seen a couple of times that it seems like

Starting point is 00:07:01 four or five, four or six on the 10 year is maybe the place where you need it, where Treasury or somebody needs to step in. And maybe Trump needs to fire off a positive tweet to keep the move volatility index at bay. We'll see if we need another one of those in a little while. But yeah, this is without being able to make any clear calls. This is obviously the crux that everybody's to focus on here in the next couple months yeah i think what is uh what is more clear at least to me and be interested to get your perspective on this is where it's easier to tell the signals in the ai play right now the the numbers coming out of this sector are absolutely mind-boggling and you have it highlighted here the micron hit a trillion dollar market cap for the first time

Starting point is 00:07:42 as stock surges 19 and then dell stock skyrocketed 32 for its best day ever as ai server revenue source and then i think on top of that dell released their first hydro-cooled gpu rack in in conjunction with core reef and that was announced at the end of last week as well so it seems like the infrastructure build out is happening it's real i know we've been talking behind the scenes using the tools they're real they're an incredible productivity gain for for teams that know how to utilize them and i think that's the most important thing to highlight here that know how to utilize them, particularly in a cost-efficient way.

Starting point is 00:08:20 And again, going back to what we said earlier, we're in this very interesting time where you have this geopolitical strafe, you have this K-shaped economy, and then you have this behemoth of an emerging market theme and what will be a part of human society moving forward, which is this AI build-out on the infrastructure side and then the utilization on the software side

Starting point is 00:08:43 that is happening at an insane pace. Yeah. The funny thing here about all this is we had Intel, we had Cisco both up on a stick, blow out earnings, making new all-time highs. Now you've got Micron, you've got Dell. We're running it back with the late 90s stalwarts that really defined the original tech boom and tech bubble. The interesting thing, though, is for anybody out there who wants to just make a lazy comparison and say, well, this is obviously just running back that exact same trend and that exact same set of themes you know go look at a go look at a cisco pe chart and in into into 2000 right from late 90s 2000 like we're talking like 70 80 ultimately up to i believe like 150 x earnings

Starting point is 00:09:25 forward forward earnings so not even established earnings like looking forward wall street consensus earnings you know nvidia right now is trading at like 21 times forward and that's on numbers that are definitely like way too low now you can argue like yeah maybe everyone knows that they're way too low and that's that's priced in to buy side consensus already okay fine but like we are, my point is like, we are in a very different environment and it can get, it can get a lot sillier, right. Based on historical, historical trends and precedents. And, but I think what you're seeing right now is you see this, this chart on the bottom, like you are actually seeing like meaningful acceleration in reported earnings. Now that's definitely a

Starting point is 00:09:57 function of running it hot. It's like, you know, on an inflation adjusted basis, is it as good as it looks like? No, probably not. But that's the game right now to, to keep the, to keep the, the wheel spinning and to keep this working um you know the administration really needs uh s&p earnings to to rip and thus far like you are seeing that so you could argue like you know there's been a popular meme on fintwit in the last few weeks you know it's not a bubble in the p it's a bubble in the e people are overestimating the long-term you know earnings potential of these companies for various different reasons but for now right it's not been primarily other than intel intel's definitely had you know it's trading like 120x earnings like a lot of these stalwarts right

Starting point is 00:10:35 now are trading at you know justifiable like theoretically like squint and you can kind of see it multiples at least on earnings that are like clearly accelerating right so this is a real story thus far i think it's probably way too lazy to write it off as just circular financing entirely you know as you said like we're using the tools like we see at the utilities there in a way that definitely like the utilities there the infrastructure is there in a way that it was not in 1999 so for now that analog doesn't really hold and the question is like can can this continue and persist while oil sits where it is and while energy and import prices sit where they are? And can the U.S. leverage its relative strength on the LNG side to continue this power

Starting point is 00:11:17 build-out that's necessary to maintain all this? Or is this all going to get short-circuited by an ongoing strife in the Middle East? Unclear, but this is clearly a very strong force pulling in one direction on the U.S. side. You're on mute, Marty. Marty, you're on mute. Sorry, I was saying, even if the energy markets do perturb the infrastructure build out, I think it'll be temporary. Again, like you said, like I said, the utility of these tools is there. It's very clear. And we're only in the warm up stage of this. I mean, the jet tech economy just became a thing at the beginning of this year. I mean, I think you have some charts that will reference, but if you look at token usage growth, it's going hockey stick, and that will only continue to go parabolic, especially if robotics actually come to market and become a thing, which I think, I mean, you can make the argument that the robotaxis and Teslas and Waymos are already a form of that robotics. And if you think about humanoid robots and robots that will be used in manufacturing capacity, like we're at the very early stages of token utilization and consumption, they're going to hit numbers that we can't even fathom right now. And then on top of that, I think, to your point about valuation, I think a lot of people were throwing water on the SpaceX sort of valuation of $1.5 trillion, looking at their S1 and actually just recording an episode with John Tinsman, which should drop 20 minutes from now. But I think one thing that he highlighted and that a lot of people are overlooking with the SpaceX numbers that were disclosed is that deal with Anthropic that they did for leasing out Colossus, which I think took them anywhere from $7 to $10 billion to build.

Starting point is 00:12:59 And I think it might have been even cheaper than that. And they're leasing out that compute for $1.6 or $1.9 billion a month to Anthropic for the next three years. The multiple and that Colossus build-out alone is going to be massive. And they're building Colossus 2, which is going to be a gigawatt. Obviously, again, going back to the robotics thing, it hasn't really materialized in a way that makes it obvious to people. But you can easily squint and see that becoming a real thing to the point that you're making. justifying some of these valuations with SpaceX specifically, but we have it here next. I mean, staying on this theme, Anthropic just raised 65 bill series H at a 965 billion post-money

Starting point is 00:13:42 valuation. OpenAI is beginning to, their models are beginning to solve and disprove central conjecture and discrete geometry. Again, the utilization, the sort of productivity of these models is being proven out. And then on top of this, I believe Anthropic had its first profitable quarter earlier this year too so the sort of meme of they're just spending money to win the race they're not going to make any money on the back end is beginning to dissipate as well yeah look i i forgot to include that headline here but i think that's a huge one too for you know just starting to see data points for proving out the the economics but i i totally agree with you and i think you know even if there's a lot of talk about scaling laws and you know how

Starting point is 00:14:22 far can they go and you know if you throw x amount of compute on a log log basis at at the problem Like, do you get a commensurate increase on the curve that has been established in capabilities and all these different metrics? And, like, I think, you know, that's an important conversation. And definitely, like, if suddenly scaling laws broke, like, a lot of these stocks would have a problem for a while. But the reality is, like, if everything stopped tomorrow in terms of improvements in capabilities, like, I think we're at, like, 0.01% of the actual utility that can be unlocked from what we have today. Like I look at my workflows and, you know, everyone, anyone who follows you knows that you've been kind of on the cutting edge of remaking your business and TFTC with a lot of these tools.

Starting point is 00:15:04 And I think you would probably say like, you can think of like, you know, a hundred things you'd like to do still better with them. I'm like even farther behind you, you know, I've really started in the last like couple of months to, to ramp up more and rethink my workflows. But I can, you know, sitting here today, like I can imagine like another hundred things that I need to build and that I could automate better. and you know we don't even have like a massive business at 1031 like think think through like apply that to all of the corporations that are out there that have a ton of inefficiency but also a

Starting point is 00:15:32 ton of creativity in a lot of their workforce like if everything stopped today in terms of advancement we still have yet to we have like multiple decades of unlocking actual utility and productivity you know beyond what we have today out of the tools that we have just today so you know fully co-sign like there's a big element of this that is like clearly being proven out right now and that is definitely not fake and if at all like if the curves stop tomorrow like we've got a long way to go before we fully kind of harvest what's available today yeah which brings us to the other side of the coin which is you have all this incredible growth productivity efficiency being brought to market but then that is not being felt by everybody again leaning into

Starting point is 00:16:11 the k-shaped economy meme for looking at delinquency rates 90 plus day delinquency rates on credit cards student loan debt auto loans mortgages all beginning to creep up credit cards getting to 2008 levels if you look at savings rates collapsing right now lowest since april 2008 and so you have this again this juxtaposition of this incredible wave of productivity sort of infrastructure investment now beginning to be profitability in the ai sector and then And the common man doesn't seem to be able to capture that value and put it to work for themselves. And they're obviously struggling as inflation begins to rear its head again. And the prospect of the jobs market becomes a bit more tumultuous for your average person.

Starting point is 00:17:03 Yeah. I mean, here's your K-shape. And I could have picked a bunch of other charts that would have kind of shown the same thing. And it's a really interesting time because we've highlighted this on prior episodes and prior newsletters. But there's kind of a damned if you do, damned if you don't impact here or a dynamic here where it's like what if we're wrong about – what if the U.S. is wrong and the AGI people are wrong about where this is all going and there's all this massive capital expenditure and increasingly debt being taken out. not a massive amount yet, but you can see that increasing and, you know, resources being pumped into the data center build out and the AI build out on, on the assumption that this is going to be, this is the future of the economy. And if for some reason that, that, you know, we're, we're off by an order of magnitude and a lot of that goes, goes belly up or goes upside down. You're gonna

Starting point is 00:17:49 have a major problem like immediately, right. In tax receipts from your bottoming, bottoming out equity valuations, you'll have public markets collapsing. You'll have issues in the credit complex like that's that's a really bad scenario already and it's going to get worse if more and more resources get pumped into this thing over the next few years which is going to happen right so if you're wrong that's not good as the u.s what if you're right right like what if the the agi pilled people the darios and the sams of the world which by the way some free advice guys if you're listening you're definitely not if you're listening please stop going on podcasts like or get a pr person who can help you in some way massage this narrative better but in any case

Starting point is 00:18:26 It's like, what if that narrative is right and work is going away, we're going to like 30% unemployment before we finally get to AI utopia where everything's abundant and we have the Star Trek future. And you've already got a huge amount of the economy looking like this, right? You've got people with delinquent student loans and increasingly auto loans and big credit card debt, you know, highest since 08. Mortgages are okay now, but like what happens when like 20% of the white collar workforce, you know, in middle management, like it's laid off, like our mortgage is going to look great in that case. Like, you know, probably not. So if you're right, where does that leave us in terms of the social reaction function to all of this? And this is increasingly getting discussed on various sides that we can talk about. But, you know, this is a big cognitive dissonance and tension that is going to bear monitoring, I think, over the coming year.

Starting point is 00:19:14 Yeah. To your point about the narrative side of things, they really need to figure this out. And it is, I mean, we'll just keep going down the chart here, because I think what, I mean, I'll skip this for now, unless you want to talk about it, because I think the Mamdani stuff is probably more pertinent to this particular point of conversation. But I mean, you highlighted this juxtaposition. And I think to your point, I think Brad Gertzner recognizes this narrative problem. And he was on TBPN last week beginning to sort of try to counteract the negative PR winds that are coming AI's way due to the energy usage, the specter of mass job losses because of the technology. And he's thinking about ways to work with the Trump administration to create an initiative that would, quote unquote, deliver a very tangible, profound dividend to communities where they're building data centers. And then that's juxtaposed to news from last week of Mayor Mamdani from New York City pledging an aggressive crackdown on bad landlords, saying that New York City will work to transfer ownership of tenants. So talking about overt private property seizure in New York, coming after the bad landlords, and you can see if that's becoming popular in the largest city in the United States, the financial hub of the world. It's very easy to project that forward and have people begin to demand similar actions against AI hyperscalers and anybody building out that infrastructure.

Starting point is 00:20:50 Yeah, for sure. Look, the Mamdani thing, it's not obviously directly about AI, but people hate landlords in general, and that feeling can be and often is weaponized by leftists and communists to get certain outcomes. But people really, not just your tie-dye hair liberal arts grad who came out of Barnard or something, not to over-stereotype, but your your your mom donny base right that you would expect like obviously a lot of emotions can be weaponized uh in that base but like everyone hates data centers basically right now and you can argue like i think there's interesting evidence that that's largely like an astroturf campaign that's being encouraged by certain foreign actors we don't get into that but you

Starting point is 00:21:38 know it's pretty clear like there's an increasing tide of everyone from your barnard grad to like your blue-collar mechanic to your random white-collar worker in a random second-tier city, right? Everyone hates data centers increasingly. And so I think it's interesting that you see Gerstner kind of floating this idea that he's going to work with tech leaders in the White House to make sure everyone gets taken care of based on the growth of these data centers and pay a dividend. I love the capitalist framing of the equity-based framing of this, what is basically just like you know a welfare payment based on this you can see him trying to get out in front of it right with his own with his own spin and you know the question to me is like

Starting point is 00:22:19 if you're doing that like what's gonna be more popular like well here's like a well-structured you know dividend plan based on the the growth of data centers or is it gonna be more popular to have a demagogue who says like you know what we'll just take your stuff right like that's like that's increasingly in the overton window now that's a conversation a lot more people are going to have and going to want to have. And that has real implications for, as I said, like the social fabric and also the monetary and fiscal reaction function to potentially, you know, if you have discontinuous and sudden like nonlinear jumps in unemployment, again, with the K-shaped backdrop we already have, like what's the response to that ultimately going to

Starting point is 00:22:56 be? Like there's a knee-jerk response, whether, regardless of like, whether it's, you know, Trump in office or AOC, whether it wears a MAGA hat or a Che Guevara t-shirt, right? Like there's one kind of common reaction function, which is in one way or another to print the money, to write the checks, to write the STEMIs. Maybe you do that by monetizing excess surpluses that have been saved overseas by trade surplus countries that we're friendly with, as it seems like we're trying to do right now, whatever. But this kind of rhetoric leads ultimately in one direction. I think it's really popular. Yeah. It's funny. I've been talking to Tom Mazzaro from Cathedra about this because we actually did some research on this as it pertains

Starting point is 00:23:36 to Bitcoin mining back in the day when we were having problems. But I think Bitcoin miners have done a good job of sort of figuring out the narrative and how to position things. And AI data center builders can learn a lot from the hard work that we put in over the decade. But it was funny to see Gerstner float this idea because Tom's actually been publicly talking about like an alaskan uh oil permanent fund like structure for these ai companies and local communities if you have a data center come in and to your point it'd be very similar to a dividend but if they are as profitable like if you think of like colossus in memphis and how profitable that's going to be alone if you were to set up like a permanent fund for the local county maybe

Starting point is 00:24:17 the state the city whatever it may be and just throw throw some some dividend into that and you do that over time i think that could be a good way to to curb the the blowback the narrative blowback that you get and then on top of that i think it's a lot of education because i do think that all this is massively beneficial for those who know how to utilize the tools on the back end but on the front end i think the energy infrastructure build out is completely necessary take ai out of the equation like our grid systems need a revamp and a bolstering whether or not ai was a thing like and so i think reinvestment in this energy infrastructure and hopefully investment uh to a point where we we just have abundant rather cheap

Starting point is 00:25:00 energy because the case for investing in generation assets and interconnection assets and transmission assets is much easier to make because the the revenue is much more reliable this is this can be overall good for for humanity and this is again going back to dario and sam like stop going on podcasts like let people who can actually pitch a good vision of the world do do the narrative crafting for you because there is an actual legitimate good narrative to be spun here from the energy generation side it's just the the market and the average person has no idea how these energy markets work in the first place yeah for sure i mean it was to your point it was a narrative that worked a narrative pivot that i think worked well for bitcoin mining several

Starting point is 00:25:43 years ago and i think that one of the most powerful charts people can see is like china's construction of new megawatts of uh grid production relative to the u.s you know ours has like effectively flatlined for i don't even know how long like 20 years um and china's just up into the right constantly and i think people can just see that intuitively grok like that's not sustainable and people people can understand like there is no such thing as a rich energy poor society and so you know moving more and more of the narrative to exactly that point i think would be very helpful and it is not even just a narrative win like it is legitimately true but you know we'll see if if that kind of framing can win out oh you know ai data center's bad

Starting point is 00:26:21 we're we're gonna move to seize the means of digital production new york will find out the hard way hopefully we can avoid it i think i think the i don't know the branding of communism and socialism is is not very good right now i mean you had a hasan you know whatever piker get get like chased away from like i think he was chased away by ice riders or like get out of here last night but i digress we're going to end it on this again i told you we would talk about bitcoin fundamentals and from a narrative or not a narrative excuse me um from a sort of value fundamental value prop side and then on the technical side and again i think we missed last week so we weren't able to talk about her move safe and then on top of that we've got

Starting point is 00:27:04 incredible developments happening on the privacy and medium of exchange payments aspect of Bitcoin from Cali and the Cashew Protocol project. Yeah. I mean, I think this is, you know, we like to end on Bitcoin, but I thought it was a really poetic juxtaposition of headlines. I think we hit Hormuzif a little bit on the last episode when it like just dropped that morning when we talked about it, but we won't have to belabor it again. I'm sure people have heard of it at this point, but you've got Iran, you know, floating this idea of a, you know, an insurance operation for maritime cargo going through the Strait of Hormuz, administered by Iran with fees paid in Bitcoin, settled on Bitcoin blockchain. You know, this is one potential validation of the long

Starting point is 00:27:45 running Bitcoin thesis that, you know, it's money for enemies and you've got a heavily sanctioned country trying to launch what is really, frankly, like kind of a protection racket. Like I don't really expect it to get off the ground, but trying to launch this with direct integration to Bitcoin, because that's the only thing that that's appropriate for this very adversarial payment situation for, you know, a sanctioned country, you know, is a perfect validation that sovereigns care, sovereigns are paying attention. You know, the biggest players in the world understand some of the key properties we've been talking about with related to Bitcoin for a long time. This is not an encouragement from TFTC or 1031 for anyone to go and use Bitcoin to avoid U.S. sanctions,

Starting point is 00:28:23 just an observation of what that might what that might mean. And again, I don't expect it to actually like get off the ground in a meaningful way because like just just using bitcoin is not going to you know stop someone from from being sanctioned and from feeling the pain of u.s sanctions uh for participating with iran um but interesting data point on the sovereign side on the the technical privacy kind of uh you know 100 sat scale like the the hormuz safe is relevant for the you know a thousand plus bitcoin scale this is relevant for like the 100 sat scale the average daily user you know cali has been if you're not familiar with him you should follow him on twitter Nostra everywhere, a real monster in Bitcoin and Bitcoin-oriented development, and has been

Starting point is 00:29:02 working for a while on using secure enclaves to facilitate cashew mints. We probably don't have time to get deeply into cashew on the show right now, but basically an implementation of Chami Neekash that has potential promise to make Bitcoin much more tractable as a medium of exchange for small payments or even increasingly large payments as well. Very simple, very, you know, dumb, easy to play with, easy to develop on, you know, make certain trade-offs relative to using Bitcoin itself on the blockchain, but for potentially significant gains in speed, ease of integration, and, you know, various other benefits. I'll hand it off to you to talk about this particular development, but the high-level, like, theme that I think this highlights is

Starting point is 00:29:48 If the value is right and this is moving in a certain direction, you would have the potential here to solve one of the major tradeoffs of using Chaminade Cash, which is the operator of a mint can potentially inflate supply and effectively rug participants in the mint without much pushback from the users or a way to govern that. This could potentially be a solve for that. And it just pushes you one step closer to maybe making this very viable at scale. And so I just think it's interesting that, like, as price, you know, as price flattens, flatlines, it's a crappy environment out there. We, you know, everyone's bored. Everyone's going away and buying AI bottleneck stocks. You're seeing meaningful validation at both the sovereign level and the technical level for what we've been talking about in Bitcoin and the reasons that we're here in the first place. Right. Like, even as the bear market drags on, like, you're seeing ongoing validation of everything that, you know, that we care about here.

Starting point is 00:30:42 Yeah, completely agree. matt and i talked about it on friday not this specifically but the the fact that sentiment i i think i've been a bitcoin since 2013 i think this sentiment is the worst since 2015 and historically that is the the best time to be allocating to bitcoin not financial advice just highlighting some pattern recognition from my days in the trenches over the years but as it pertains to what cali is referencing here for the cashew protocol i think the trusted execution environments are slept on we have a company in the portfolio maple ai that we backed because of their utilization of trusted execution environments and essentially for those who are unaware

Starting point is 00:31:20 these environments allow you to run code in secure enclaves and so your phone your iphone you're doing face id basically people think that a lot of people just assume that you're sending your biometric data to to an iCloud server but no like your face is a private key that's held on the secure enclave in your phone you can run software on that not only that but you can interact with secure enclaves in the cloud as well and what these secure enclaves allow you to do is to run compute in a way that the person actually running the computer has no idea what's what's going on it is a trusted execution environment and what cali is referencing here i'm not going to pretend to know exactly what he's built and i think that's he's been a bit um sort of opaque

Starting point is 00:32:08 about what's actually happening and just sort of alluding to what they're doing but what i assume is that you were able to set up a a mint within a secure enclave using one of these trusted execution environments and you can sign blinded messages for the the mint users or blinded signatures excuse me to facilitate payments and to john's point if you can do like a reproducible build to prove that the operator of the mint can actually control it at the end of the day can inflate supply can't prevent people from from spending that is going to be massive and i think the progress progress that we've seen with te specifically is again slept on but something that i would highlight for anybody listening to pay attention to moving forward particularly and we

Starting point is 00:33:01 We backed Maple originally, their Mutiny wallet pivoted to Maple. We were very comfortable with the pivot to Maple and the focus on AI over non-custodial Bitcoin Lightning wallets using these trusted execution environments. because I think as many people become more aware of how much data you're going to be sharing with the hyperscalers, the demand for the ability to do AI compute in a trusted execution environment that a hyperscaler doesn't have access to the information, the prompts or the outputs that you're putting in and getting out,

Starting point is 00:33:38 the demand for products like that is going to increase significantly. I think actually it will be mandated for certain applications like legal health whatever it may be and so it's really cool to see this being reintroduced to bitcoin mutiny really led the way there many years ago with the non-custodial lightning wall it's using these secure enclaves and it looks like cashew is leaning into it as well and so this is going to create um very secure and private bitcoin infrastructure which is great to see yep absolutely it's a it's a good time to be paying attention to what really matters in bitcoin And it's exactly what you'd want to see when the prize isn't going,

Starting point is 00:34:15 isn't going your way. The question is what's happening under the hood with fundamentals. And I think we're, we're only getting positive fundamentals, you know, year on year here. Yeah. That's great. Hey, wild times out there. I'm going into the summer.

Starting point is 00:34:29 I don't think there's going to be summer doldrums this year. I have a hard time to believe that it's going to be a very doldrum filled summer. I think things are just heating up proverbially pun intended. John great rip. As always. We'll be back next week. I don't know.

TFTC: A Bitcoin Podcast - Ten31 Timestamp: Just Add a Zero

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