The Pomp Podcast - #1232 Billionaire SHOCKS TV Host With Bitcoin Knowledge

Episode Date: August 9, 2023

Anthony Pompliano breaks down billionaire David Rubenstein’s thoughts on bitcoin, BlackRock, and why he believes bitcoin is not going away.   ======================= Sign up for a StartEngine account today using the link below and explore live investment opportunities where you can start investing with as little as $100:https://invest.startengine.com/?utm_source=podcast&utm_medium=anthonypomp&utm_campaign=startengine-own The information provided in this marketing material is for illustrative purposes only and should not be considered as financial advice. Past performance, including the success of certain individuals, is not indicative of future results. Investing in any market, including startups, involves risks, and there is no guarantee that similar opportunities will yield comparable returns.Number of Users is determined by counting user profiles with unique email addresses which are active and have been confirmed*Includes $760M in funds raised as of May 9, 2023 via Reg. CF and Reg. A+ combined through StartEngine’s funding portal and broker dealer, StartEngine Capital, LLC and StartEngine Primary, LLC respectively, as well as StartEngine’s own raises. Also includes $470M in funds raised previously through offerings conducted on http://www.seedinvest.com outside of the StartEngine platform. In May 2023, StartEngine acquired assets of SeedInvest, including email lists for SeedInvest’s users, investors and founders seeking to raise funds. ======================= Get Better Crypto Data: Do you want faster, easier crypto data? Sign up for Velo Data, a new product that we have been working on to solve this problem: ⁠velowaitlist.com⁠ ======================= Pomp writes a daily letter to over 250,000+ investors about business, technology, and finance. He breaks down complex topics into easy-to-understand language while sharing opinions on various aspects of each industry. You can subscribe at https://pomp.substack.com/  

What's up, guys? Bang, bang. Today's episode is just me, solo episode talking about David Rubenstein, Bitcoin, and BlackRock. There was a recent interview that David did on national television, which I found fascinating. Before we get into this episode, though, let's talk about our sponsors, and I'll be right back to tell you how the world's changing and why Wall Street coming into Bitcoin is something that you got to pay attention to. This episode is brought to you StartEngine. The biggest fortunes aren't made on Wall Street. They're made way before startups hit the stock market. Consider Mike Walsh. He was just a regular guy, but then he invested $5,000 into Uber. And that investment money, it grew to a staggering $24.8 million. Such opportunities

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with as little as $100. Again, run over to startengine.com and you can explore those live investment opportunities today. Before we get into this episode, I also want to tell you about a brand new product called Velo. Velo is faster, easier crypto data. Everyone in the industry is always looking for, what's the price?

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we're advising the founder, and we think it's pretty cool. This one is something that keeps me informed on a daily basis, so you should check them out at VeloWaitlist.com. That's V-E-L-O Waitlist.com. Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an

expression of his personal opinion. This podcast is for informational purposes only. David Rubenstein is a billionaire who previously co-founded Carlyle Group. Carlyle Group's got $385 billion of assets under management, and David is estimated to be worth $3.3 billion himself. And it's interesting because David Rubenstein also has a show with Bloomberg, where he interviews some of the top investors around the world. Over the years, many of these investors haven't been that excited about Bitcoin or cryptocurrencies. But recently, David Rubenstein hosted Mike Novogratz, who's the Galaxy Digital co-founder and CEO. Mike previously worked at Fortress, and that's where he learned about Bitcoin, and he bought a bunch of it personally, along with a number of other employees at Fortress.

Bitcoin's price has drastically increased from about $100 at that time to today it sits right around $30,000. And so David Rubenstein talking to Mike Novogratz was fascinating because we got to see into the mind of one of the leaders of the cryptocurrency space. But then David Rubenstein, having had that conversation, he went on a Bloomberg show and they started to ask him all about Bitcoin and cryptocurrencies. The conversation is fascinating because we have the Carlyle Group co-founder, somebody who's worth billions of dollars himself, now talking about Bitcoin and cryptocurrencies in a very different way than he and his peers were talking about it just a few years ago. Here's a short clip from that conversation where David Rubenstein is asked over and over and

over again about Bitcoin, and he continues to have impressive answers and rational thought around why Bitcoin is going to last and why he thinks investors will continue to pour capital into the asset. Here's exactly what David had to say. This is perfectly timed because Novogratz has been the pinata of Bitcoin when it goes down. It's been the genius of Bitcoin when it goes up. And all of a sudden, Larry showed up at the door to say, hey, big, respectable firms can prosecute and do Bitcoin. Link Lawrence Fink of BlackRock to Mike Novogratz. Well, what's happened is people, as you suggest, make fun of Bitcoin and other cryptocurrencies. But now the establishment, Larry Fink at BlackRock, is now saying they're going to have an ETF if approved by the government

in Bitcoin. So you're saying, wait a second, if the mighty BlackRock is willing to have an ETF in Bitcoin, maybe Bitcoin is going to be around for a while. Lisa wants to jump in here, but I'm going to cut to the news moment. Is Carlisle announcing this morning a Bitcoin advocacy? No, I don't think so. But there's no doubt that Bitcoin is something that I wish I had bought it at $100 a Bitcoin. When Mike Novogratz started buying, it's now at $29,000. So he's made a lot of money. And a lot of people who bought it at $100 or less are feeling pretty good. Now, it went up as high as $61,000. I think even down to $31,000 or even $29,000 now is still a pretty good profit if you bought it at $100. We all wish we would have bought it at $100

to ride it up. It's one thing for BlackRock to come up with an ETF because they believe the proposition of Bitcoin. It's another because they see a profitability proposition where they can, you know, basically take advantage of the interest other people have. I mean, isn't that more of what this is that basically Wall Street is saying if there is a market for it and we can viably make one for them and make some money, why not? Well, remember, Wall Street is in business to make money, and this is something they can probably make money off. You have to remember the United States government has been somewhat skeptical of it. I think Democrats in the Congress and particularly the people regulating the SEC are skeptical of Bitcoin and other cryptocurrencies.

But outside the United States, there's a lot of interest in it. I think FTX really hurt when it went bankrupt and it hurt the crypto industry. But a lot of people around the world want to be able to trade in a currency that their government can't know what they have, and they want to be able to move it around, rightly or wrongly. And so I don't think Bitcoin is going away. I think the Republicans on Capitol Hill have been pretty supportive of it. There's a difference between having a seamless cross-currency payment, basically saying,

That instead of going to Western Union, I can go and just transfer something in Bitcoin if it has a stable enough price. That's one proposition. But the proposition of Bitcoin as a store of value that could kind of be bid up the way that gold or silver could seems to have been parked with the advent of yield suddenly that you can get for actual money. I mean, isn't that sort of the feeling that you're getting? Well, there's no doubt that when interest rates are as high as they are, you don't need to have gold or other kinds of things to get you some solid return because when you get 5% on treasuries, but eventually 5% will be coming down at some point. I don't think Bitcoin or cryptocurrencies that are the better ones, the better known ones, Bitcoin and a number of others are going to go away. There's enormous interest around the world in being able to have something you can transfer without the government knowing about it and keep it private. And, you know, you can say people shouldn't do that, but that's not going to stop people from doing it. Mr. Novogratz and Mr. Gensler, what did you say about the efforts of our chairman of the Securities and Exchange Commission? Well, Gary Gensler, who's the chairman of the SEC, is not a big fan of cryptocurrency. I think that's fair to say.

But he lost a major case recently in court where he was trying to argue that one of the cryptocurrencies, Ripple, was a security, and he lost that case. So I think the SEC has not been able to convince at least the government yet, or at least the courts, that cryptocurrency is such a dangerous thing. And I remember a lot of people in the government now are thinking that Gary Gensler won't be the chairman of the SEC forever. I'm sure he wanted to go. I mean, these guys just wait him out, right? I think that's a strategy that's very popular in Washington, waiting out regulators you don't like. Now, what's fascinating to me is not only that David Rubenstein is having this conversation on national television, And he's openly talking about the fact that people are going to continue to invest in Bitcoin.

But he specifically said two things that I want to call attention to. The first is he talks about part of the value proposition of Bitcoin is that it is antithetical to the government's view on centralization of the monetary policy. Now, that is something that historically has been reserved for people on Twitter, kind of the conspiracy theory crowd, or maybe the libertarian crowd. But now we have a multi-billionaire who co-founded one of the largest asset management firms in the world saying whether the United States government, whether regulators, and whether people

in the traditional financial system like it or not, there are millions, if not hundreds of millions or billions of people around the world who find that aspect of Bitcoin quite compelling, and it is a major driver of why they will continue to allocate capital into the asset. So now that secret's kind of out there in the open. People are talking about it,

and it's being viewed by people who are part of the establishment, not as a negative, but actually as a positive. A huge piece of investing is to not just take your own personal opinion or your own personal views and go ahead and try to figure out if everyone agrees with you or not. The best investors understand that the better thing to do is understand what do other people think? How is the market going to react? And if you realize that there is a large portion of the global population that wants to have a decentralized digital currency that is not controlled by their government or by their central bank, then obviously Bitcoin will continue to be valuable in the future. Now, the second thing that David talked about in this interview is the fact that BlackRock is coming in with their ETF application.

He basically says, listen, BlackRock is this mighty asset manager. And if they're going to go ahead and put forward an ETF application, then of course, they've got a high likelihood of thinking it's going to get approved. If you remember, I've talked about it previously. BlackRock's record when it comes to ETF applications is 575 wins to one loss. Literally, 575 out of 576 applications have been approved. And so it is highly likely that they are going to actually get this approved. Now, we just saw that the Federal Reserve announced a brand new oversight mechanism for the cryptocurrency market.

That lends more credibility to the fact that people believe that BlackRock and other ETF applications for a Bitcoin spot ETF will be approved. Mike Novogratz and Galaxy Digital recently let people know that their insiders at these various financial organizations believe that the ETF application will be four to six months away. Now, if we bring this back to Rubenstein, he's basically saying that BlackRock is removing the career risk for any other organization. If you are a large financial organization on Wall Street, now you can get in the game because Larry Fink and BlackRock did it.

If we go back to 2020, we saw this mechanism play out once before. Stanley Druckenmiller and Paul Tudor Jones, they came out publicly and said that they supported Bitcoin, that they owned Bitcoin in their portfolio. And they even went as far as PTJ saying that he believed that Bitcoin would be the fastest horse in the inflation bucket of assets.

And he ended up being right. But once those two legends of Wall Street said that they were into Bitcoin, every other portfolio manager on Wall Street now had the ability to go and invest in Bitcoin because career risk had been removed. The legends did it. And so now anyone could do it.

We're watching the same thing play out with BlackRock. If it's good enough for BlackRock, it's good enough for any other financial institution. David Rubenstein understands this mechanism really well. He realizes that LPs or public shareholders of these asset management firms are going to have a lot less questions today if you go in and allocate capital

to Bitcoin or cryptocurrencies than they would have before BlackRock made this decision. Career risk has been removed. Now there's a green light for financial institutions to start to allocate to Bitcoin and cryptocurrencies.

And we have multi-billionaires like David Rubenstein talking about it as if it's any other asset class, stocks, bonds, or Bitcoin. It's pretty incredible to see how far we've come in about 15 years, but it's just another signal that Bitcoin will continue to be institutionalized by Wall Street.

At the same time, people outside of the United States, places where their currency is failing, inflation is ravaging, or there's risks around censorship and censorship, they continue to adopt Bitcoin as well. Most technologies are a top-down approach. The military and nation states go ahead and create these technologies and they adopt them first. Then it's corporations and then it's individuals.

Bitcoin is one of the special assets, which has been bottoms up. Individuals adopted it first. Now we're seeing corporations and large financial institutions go ahead and get in the game. And eventually we will see every nation state in the world adopt Bitcoin as well in some form or fashion. Doesn't mean that they will replace their nation state currency, but they will use it in some form or fashion, whether it's on their central bank balance sheet or they actually allow their citizens to pay taxes or each other with this currency. David Rubenstein is another person that we now can put into the supporter of Bitcoin category. doesn't mean that he necessarily went out

and bought hundreds of millions of dollars of Bitcoin personally, but it does mean that he understands that the ground is shifting under the industry and Bitcoin is going to continue to be a institutional asset class moving forward. It already is worth hundreds of billions of dollars and it likely will be worth trillions of dollars

in the future. As we see Mike Novogratz, David Rubenstein, BlackRock, Fidelity, and many other large investors or asset management firms come into the space, you have to remember that we need them. We need them to continue to push Bitcoin forward. Whether we like it or not, Bitcoin and its holder base is changing,

but that change isn't necessarily a bad thing. You just have to be aware of what's happening. It's amazing to see David Rubenstein answer so many questions about Bitcoin on national television in such an eloquent way. I was super impressed by it. And if you get a chance, I highly suggest going and watching the full interview.

Hopefully you enjoyed this update and I'll do more of them in the future. Thanks so much for watching this video. If you liked it, make sure you subscribe to the channel and like it so more people find it. I'll continue to crank out as many of these as I can. Have a great day.