The Pomp Podcast - #1532 Natalie Brunell, Marty Bent, Thomas Pacchia | Bitcoin Will Be The Global Reserve Currency

Starting point is 00:00:00 What's up everyone? This is Anthony Pompliano. Many of you know me as Pomp. You're listening to the Pomp Podcast, which is my effort to find the most interesting people in the world and sit with them for hours while I ask questions in an effort to learn. So it would mean the world to me if you would subscribe to the show on your favorite audio platform, watch episodes on YouTube, and tell your friends and family about the podcast. My goal is to help millions learn from the world's most interesting people. So let's get into today's episode. 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

Starting point is 00:00:40 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. Today's episode is brought to you by ConsenSys. They're the world's longest-running and most influential gathering of the global crypto, blockchain, and AI communities. Curated by Coindesk, this prestigious annual event happens in Toronto, Canada on May 14th through the 16th, and it is set to welcome 20,000 builders, investors, policymakers, and pioneers shaping the future of the decentralized digital economy.

Starting point is 00:01:15 From understanding Bitcoin's potential in a shifting regulatory landscape to the latest innovations in the digital assets and infrastructure, ConsenSys is your best bet to unlock market-moving intel, make meaningful connections, and get business done. You can't afford to miss it. And because you listen to this podcast and you watch this show, you get 15% off registration if you use the code POMP15. Go to coindeskpomp.com. Again, that's coindeskpomp.com to register now. Once again, go to C-O-I-N-D-E-S-K-P-O-M-P.com and use code POMP15 for 15% off your Consensus Toronto tickets today. Today's episode is brought to you by Polkadot. Polkadot offers secure, scalable, and decentralized blockchain technology that perfectly aligns with the needs of innovative

Starting point is 00:02:01 projects. It was developed by Gavin Wood, one of the co-founders of Ethereum and the creator of Solidity. Polkadot aims to build an internet where users have full control over their data and their applications. Polkadot offers tons of unique features, a shared security model, along with a new auction model and significant implementations like ASIC banking. Given these characteristics, it's easy to understand why Polkadot is gaining more and more traction in the cryptocurrency world. Some people even are talking about it as the AWS of Web3. Now, companies such as Mythical Games, Astro Network, and over 50 other independent blockchains with hundreds of applications already leverage Polkadot's technology to power their platforms. If you're looking for a reliable, scalable, and cutting-edge solution, Polkadot seems to be the top choice for industry players.

Starting point is 00:02:46 Go check them out today at Polkadot.com. The reason I wanted the three of you up here is I kind of feel like all three of you are defenders of Bitcoin. You're kind of like the defenders of the Bitcoin ethos, the defenders of Bitcoin's values, defenders of the Bitcoin conversation. And you all do it in kind of unique ways. So since you decided to sit closest to me, why don't we start with you? Talk a little bit about PubKey and this idea of building like a cultural center for Bitcoin, which when people see it, they're like, oh, this is kind of like a dive bar, but it's kind of like a media company, but it's kind of like a Bitcoin company. And so talk through, like, what did you set out to do and what has it

Starting point is 00:03:26 morphed into today? Yeah. Look, culture's everything. Who's been to PubKey in this room? Let's go. That's awesome. That's not enough hands. Not enough hands. Not enough hands. If you haven't been, everyone's welcome. We'd love to see you. So in COVID, two things happened here in New York city. A lot of Bitcoiners left. They went to Austin, Nashville, Miami, and dive bars got decimated. And other than my family, my two biggest loves are Bitcoin and dive bars. And there was an opportunity to smash the two together. Pubs and taverns throughout human history have an outsized importance with revolutions, cultural revolutions. You think about the Revolutionary War and the Green Dragon and all of that. Thomas Paine dropped common sense

Starting point is 00:04:13 off at a pub, effectively. So you have somebody, they pick it up, they read it, and they say, does it suck or is it me? And people are like, no, it kind of sucks. Maybe we should overthrow the government. So it was a good fit, right? And at a pub, at a dive bar in particular, socioeconomic barriers melt away. You can run a private equity fund sitting next to somebody that works in sanitation and it doesn't matter. They're having a Miller High life and they have an opportunity to have a conversation. So we kind of buried Bitcoin from the jump and we didn't want to make it a Bitcoin themed bar that's plastered with everything. We wanted it to be welcoming for really a much broader audience, but they got exposure to Bitcoin and to other things through

Starting point is 00:04:54 seeing Bitcoin payments or a Bitcoin event that's happening in the back. And they get to ask the first question, which is a different conversation when that happens. Marty, I was thinking the other day. I think you're one of my first Bitcoin friends in real life. Before you started your show and this trajectory to where you are now, we met at the Barstool offices on a rainy Saturday morning in 2017, I think. So everyone knows you start Bitcoin. It's like an internet thing, right? And then this guy messages me or I message you, whatever. We'll start talking online. And he was like, do you want to meet me? I was like, sure. He's like, but it's got to be at 7am tomorrow morning or something. I was like, shit, can I get out of

Starting point is 00:05:31 this. But we went and you were at Barstool and then you left and built this entire media property. And I think that a lot of people kind of look to you for unique ideas, but also having people tethered to what those Bitcoin values and ethos are. So kind of talk through like what's that journey been like and how do you think about TFTC today and like what you guys are doing? Yes. I mean, TFTC started really as a way for me to not have to answer texts that my friends and family were sending to me individually. So it started as a newsletter where I sent my friends and family who were asking me about Bitcoin in 2017. I was like, I'm going to write a newsletter every day. I'll teach you a little bit about Bitcoin. And then I wound up sharing that on

Starting point is 00:06:17 Twitter and the list grew and grew into this media company. And I started it really trying to teach my family and friends about the economic value prop of Bitcoin, the technical details of how the protocol works. And over time, just trying to stay on top of that, because I think it's important, particularly today as institutional capital comes in and nation states come in, we have to remember that there is a distributed protocol, free and open source software project that is enabling this revolution in finance and economics to happen. So it's important to make sure that we understand what's happening with the protocol, the people who are building on it, what they're running into.

Starting point is 00:07:02 And so TFTC today stands for Truth for the Commoner, really trying to bridge the gap between where people are and what's happening in Bitcoin. And beyond that, it's really evolved over the years, and I view it as an olive branch to other sort of communities and people that may not be into Bitcoin, but you can tell they're ideologically aligned and using the platform as a way to open up the Bitcoin conversation with them, similar to what Thomas is doing in the physical world with PubKey. Natalie, you knew nothing about Bitcoin maybe six years ago, seven years ago, and you've taken the world by storm. You had a background in kind of more traditional media,

Starting point is 00:07:44 And I think you've used those skills to kind of really open up people's eyes to a lot of different conversations, a lot of different people. Talk about essentially quitting your job for Bitcoin and, you know, diving headfirst into this and what it's been like. Yeah, well, you were a source of inspiration. I always followed the very traditional path. If people have followed my work and my show, I come from a working class background. Parents are first generation immigrants. We came here from Poland when I was five and I wanted to be a journalist. My parents lost everything in the great financial crisis, and that's exactly when I started my career.

Starting point is 00:08:18 So I was sort of the reporter focused on shedding a spotlight on corruption and wanting to hold people accountable. And it's so interesting to look back at the start of my journey because I didn't understand how the financial system worked. I was never taught that in school. I considered myself a good student, but I never learned about fractional reserve banking and the problems with the central bank. And so I was part of the tax the rich movement when I came out and I wanted to shed light on these issues and hold the corrupt accountable. And when I learned about Bitcoin, I dismissed it. I was very skeptical and it took me years to fully understand. I had to go on that journey. I listened to shows like, like the ones you produced and I read the Bitcoin

Starting point is 00:09:10 standard and I realized that I wasn't actually focusing on the real problem. I was focusing on the symptoms. And so then I started my show as a total hobby. I took a chance. I just wanted to learn more about Bitcoin from the people that I had, um, you know, studied about Bitcoin through and it turned into my full-time job. And I, I sometimes can't believe that I get to do this and educate people and bring in more of that mainstream audience. Because whenever I was reporting stories, I always thought about my mom and dad, not just what they lost, but also them in the audience and just reaching that average person who's busy in whatever industry trying to do their best. And somehow they're never, it's never enough. They're not

Starting point is 00:09:52 making it. They feel like they're on a hamster wheel and especially for young people, not being able to afford the house and the retirement and all that. So I, um, I, I just want to help people learn about Bitcoin and be a very approachable, welcoming source for that. I want to throw out some maybe provocative questions that I've been thinking about and I actually don't have good answers to. So I would have these conversations in private with the three of you. Let's just have them right here. The more successful that Bitcoin becomes, which means that the institutions are buying it, the nation states are participating, the mainstream media is talking about it, it feels like it becomes easier and easier for us to forget the actual ethos and reason that

Starting point is 00:10:31 bitcoin got started and it becomes like this financial asset rather than more of like the movement how do you guys think about um the ideal balance like we want mass adoption but we also don't want everyone just to become you know like uh gamblers who think bitcoin goes up all the time they forget the ethos and so what does that balance look like look bitcoin we can't forget that bitcoin or for it's for individuals it's for individuals to hold their wealth and also to spend that Bitcoin transactions are important, and we're starting to lose sight of the fact that it's peer-to-peer money. You can use it to buy burgers and hot dogs. You can use it for cross-border payments. It doesn't really matter. It is not just meant to sit in an ETF at the end

Starting point is 00:11:13 of the day. I think it's really important, and I think we try to champion this all the time, that we don't lose the plot and forget where we came from. yeah and obviously the focus in the last couple years and probably for the next few years will be this financialization of bitcoin which i think is a good thing and to thomas's point we can't forget that this is peer-to-peer digital cash at the end of the day but with that being said the the tech stack needs to be built out and mature i think that's one thing when it comes to bitcoin on the payment side that people really need to people really need to approach it with patience because it takes time. They expect everything to be built and ready and ready for

Starting point is 00:11:55 the mainstream. But the reality of the situation is not everybody has Bitcoin, as we've seen throughout time with the memes of merchant adoption that have popped up and down through different cycles. People don't want to spend their Bitcoin. But people are building the technologies that enable that. And that's on the peer-to-peer side. And I think one conversation that many people are having is very important too, is the concentration of hash rate and big actors. And I think there's a lot of positive developments in that world too, particularly with projects like BidX that are working to enable individuals to get little miners that they can run at home and help distribute hash rate that way. And so I think there certainly is a lot of people

Starting point is 00:12:36 who've been around Bitcoin for a while that are worried and a bit fearful of this institutional adoption because it seems like, oh, the suits are here. Are they going to take over? But like I said previously, Bitcoin is this peer-to-peer distributed network, despite the fact that it is becoming financialized, institutionalized, like the ability to send Bitcoin in a peer-to-peer way still, people still have the ability to do that. And the tech to be able to do it more efficiently, cheaper, faster is maturing pretty rapidly. There are so few technologies that come around that equally empower the very, very poor and those in the developing nations and the CEOs and the people in the boardrooms. And I think that we sometimes forget that the total addressable

Starting point is 00:13:19 market for this asset is 8 billion people. And whether you're in the West and you're looking at it more as a store of value and as the best savings technology because of that finite supply, or you're in a place where for the first time you are banked, for the first time you have access to financial services and a global digital economy, and you use it more as a medium of exchange, that is incredible and so i just i i believe in the ultimate free market and i want bitcoin to continue to emerge bottom up as it has as opposed to being imposed on us from the top down and um i whether you use it now more as a you know a store of value or medium of exchange that's your business now you recently interviewed ron paul in the fed audit the fed you know the guy

Starting point is 00:14:03 has been at it for a long time. He forever has fans. When I first started looking at Bitcoin, I was like, oh, this is competitive with the US dollar. It feels like that is not true anymore. It feels like Bitcoin is succeeding and the dollar is actually becoming more valuable. It's becoming more used globally. Stablecoins have really kind of pushed dollar dominance globally. Is it a world where Bitcoin and the dollar now are actually tied at the hip and they're going to succeed together or do you still think that they're competitive? No, I definitely don't think they're competitive, at least not in the short term. I do think that Bitcoin in many ways through stable coins will extend dollar dominance, but I think it's more of a question of, you know, not

Starting point is 00:14:43 what will be the global reserve currency, but what will be the global reserve asset? Because so many countries are now realizing that U.S. treasuries are not as risk-free as they, you know, are intended to be. They have risk on the duration side because of inflation and potentially even some default risks. So things are changing globally. I think we need to be aware of that. I think that's why so many central banks are buying gold right now. Hopefully someday they'll be buying Bitcoin, but we need to return to a neutral reserve asset, which I think the best, the best candidate is Bitcoin because all the things that we're hearing about right now with the new administration and all the policies and, you know, exposing the corruption and cutting

Starting point is 00:15:23 government spending. It all does sound great on paper, but I'm concerned about what can actually happen because most of our spending is baked in the cake through entitlements, through our interest expense. And being global reserve currency has actually hurt us. It's hurt the working class. It has hollowed out the industrial base. And there's an inherent dilemma between being the global reserve currency and having those strong workers. And that's why we've financialized everything. So how can we have both? I don't believe we can in the long run. I think we need a neutral reserve asset. I think it will be Bitcoin and the dollar can be our currency. Great. But I'm going to spend my dollars and save in Bitcoin. What do you guys think?

Starting point is 00:16:02 I think they compete. And the, uh, no, I see it just in the business. Um, we have contractors that, that live outside the borders of the U S and it literally is better to send them Bitcoin than wire them funds over the traditional system. Some people may use stable coins, but we're pretty ideological. And I'm like, I'll pay you in Bitcoin. And our contractors outside the U.S. are more than willing to accept it. And so there's an example of, yes, it competes. Maybe it doesn't compete on the scale that many people expect it to. But over time, Bitcoin is better money, I think. And I think there is definitely a competition. And many people may try to not really put that frame and particularly in front of politicians and institutional capital but i think

Starting point is 00:16:52 i'd like to call a spade a spade and i think they definitely compete like yesterday when the price went down i had a bunch of cash in my business account and i was like do i want to hold these dollars or buy bitcoin i had that competition in my head i bought bitcoin and for us as a business since we're paying invoices in bitcoin like that is the money we're choosing to store the value and then ultimately pay contractors with? All money dies. All government currencies end up dying in one form or another. You have gold, but I think Bitcoin just out-competes gold in terms of its moneyness. I mean, the properties of gold, paying money is super clunky. It just doesn't work as well as Bitcoin. So I think Natalie and Marty both had really good

Starting point is 00:17:34 points. I think that there is a long-term competition. In the short to near term, we do see you know the bridge to dollarization through stable coins the way people use tether to get access there but if things continue the way they're going and the dollar continues to sort of erode its purchasing power something like bitcoin is in a really nice position is bitcoin successful if it ever becomes a global currency if it just becomes a store of value it still has the property i told you guys look at there i don't even know the answers I didn't know who wanted to jump in first, but I'll take a crack at it. It has the properties, right? You can send it anywhere around the world for a pretty negligible fee as compared to

Starting point is 00:18:20 correspondent banking networks. And I think that the utility of that just wins the day. It may take a long time, but the money properties for individuals and for businesses also, I think are going to become clearer and clearer over time. And not to throw shade at ETFs or anyone else accumulating Bitcoin just as a store of value. That's good. But that's part of the curve to become money. It starts as a collectible. People want that thing. They start to value that thing and trade for that thing. So medium of exchange, unit of account, that may take a little bit longer. Store of value is where it really starts to rubber hit the road. yeah and your question if it only becomes a store of value would that be a success i mean

Starting point is 00:19:07 inarguably yes if the value of bitcoin goes up and it provides people the ability to store their value better but i don't think it's the ultimate success that that could come to fruition if it does become a money that's transacted i think it's happening like thomas alluded to there it's happening on smaller scales like bitcoin for my business and for my personal balance sheet is the unit of account. I try to make sure that the number of sats I have in my personal account and in our business account is going up. And when I'm making decisions about reinvesting in the business or going out and spending money for marketing or something like that, I'm weighing the opportunity cost of, am I going to be able to make more Bitcoin from deploying this capital

Starting point is 00:19:51 than if I were to simply just buy Bitcoin and try to figure out another way to sort of accomplish that goal without spending that money. I think it's a question of how decentralized we become if anyone's read The Sovereign Individual. So if governments want to issue fiat currencies, they want to tax us in fiat currencies,

Starting point is 00:20:15 and they want to legalize tender in fiat currencies, I mean, they're going to try to do that, but we're going to move with our money, right? We're going to speak through our choices with how we use our money. And so I think that first people will choose to save in Bitcoin and more and more people will want to earn in Bitcoin, right? In order to get the value, you're going to maybe need to part with your Bitcoin. That's why I actually think it's a very egalitarian system and people point to wealth concentration in Bitcoin. Now I think that's going to even out and it's far less than the wealth concentration we have in fiat. You're going to have to really

Starting point is 00:20:48 earn that Bitcoin. But no, I don't think that Bitcoin would be a failure. I think that there will be many places that will embrace Bitcoin and you can use it freely how you want. And the places that impose their fiat currencies and their laws and their capital gains tax, people will slowly move away from. I would normally use the term altcoins, but given the three of y'all, I'll say shitcoins. Views on shitcoin land in the sense of, I think the latest study showed that like 85% of Bitcoiners also own other tokens. The 15% that don't are really adamant about nobody should own these other altcoins or shitcoins. I also see a world where some Bitcoiners will argue that there's like R&D that's happening, and then people are pulling the best ideas over to Bitcoin.

Starting point is 00:21:35 I see that there are now like L2s and sidechains being built on Bitcoin. Just like, what are your thoughts outside of like the L1 Bitcoin, whether it is other things in the Bitcoin world or other chains and things that are people are doing kind of the larger crypto world i mean you can if you drill into specific ones it looks like ethereum is a mess right if we're just being honest i knew you were going to say that um they were serving too many masters they wanted to be decentralized prioritized decentralization and this ultrasound money concept it's all nonsense at the end of the day um and the attack vectors are are so broad now they have a competitor in solana the last couple of years that's just eating its lunch on NFTs and DeFi. It's faster, it's cheaper,

Starting point is 00:22:19 and nobody really cares about the decentralization points when it comes to that. Bitcoin is completely separate and distinct from the rest of this class of crypto assets, shit coins, whatever. That's not to say that there isn't something interesting happening with certain projects, right? Monero and Zcash, with their focus on privacy-preserving technology, that's interesting and that's worthwhile and even the ethereum solana stuff you know from an intellectual or academic standpoint is good but it's not necessarily it's not it's nowhere close to bitcoin yeah and to build on what thomas was saying right there i think particularly the the memes of like defy web 3.0 that were big last cycle i think they're they're good concepts

Starting point is 00:23:05 to sort of grok and try to understand but the implementation that is that is manifesting in shitcoin land is completely off base, in my opinion. I think we're beginning to see the ideas of what a Web 3.0 could look like coming to Bitcoin. And the solution isn't create a utility token for every use case. If you're a podcaster, issue a token that you send to your fans. It's simply incorporating open source distributed money with other open source protocols. So we see this manifest in multiple ways. Podcasting 2.0 is one example. instead of launching a token for your podcast, you simply put a Bitcoin lightning address in your RSS feeds. You're combining lightning and RSS, which is an open source content distribution

Starting point is 00:23:50 protocol. Similarly with Noster, you're beginning to see a open source communications protocol emerge and the money that's being transacted on that open source protocol is Bitcoin. So you're just combining open source communications, content distribution protocols with open source money. You're not creating a token for that. And then on DeFi, I think that is completely misguided where that whole sort of theme is looking at the traditional financial system, financial contracts, structured credit products that have been developed over the course of millennia, literally and saying, let's throw all that out and go build it over here with these tokenized DeFi systems. And I think that's miscalculated. I think it's actually going to go the other way. What we're going to see is the Bitcoinization of traditional finance. And you're beginning to see this with Bitcoin being introduced as collateral and structured credit products, simple Bitcoin collateralized loans that allow you to get fiat. And so I think the implementation that the alt

Starting point is 00:24:51 coiners have displayed over the course of the last 12 years is the wrong implementation. And we're taking some of those ideas and implementing them with Bitcoin, but you just don't have to create a new token. You don't need a blockchain. You don't need a cryptocurrency for everything. You just need to simply imbue Bitcoin into existing systems. I consider myself a non-toxic maxi. It's really none of my business what someone else is investing in or building. I'm just personally only invested in Bitcoin. I urge people to take whatever token they're interested in and price it in Bitcoin because everything goes to zero against Bitcoin. But yeah, I mean, I think that the free market should really decide. And that's what I'm a big believer in. And it took me a long time to

Starting point is 00:25:41 understand things like the blockchain trilemma and proof of work and how important the energy component is. And some people are just on that journey. So, you know, it's none of my business. you guys are all incredibly kind i thought for sure you guys were gonna say what you actually believe uh uh can you guys very quickly tell everybody where they can go and find out what you guys are doing subscribe listen visit yeah 85 washington place in the west village greenwich village right next to washington square park is where you can find us uh in new york we'll be expanding to other cities you know a pub key in every city except for boston is the uh is the goal. Uh, and you can find us on Twitter, uh, at pub key. We're on YouTube rumble. Um, we,

Starting point is 00:26:29 the overwhelming majority of our events are free and open to the public. We want to keep it that way. Um, so like, and subscribe on our channels. We post as much as we can. Um, you know, when we capture it and, you know, hope to see you soon. Similarly, you can find me on X, uh, Noster as well, martyatprimal.net. And then 1031, if you're interested in seeing how we're viewing the space and the companies we're backing, go to 1031.vc, T-E-N-3-1.vc. I'm on X at Nat Brunel. My show is called Coin Stories. It's available on all video and audio platforms. And I'm excited to share, I'm going to have a book coming out. My very first this year called Bitcoin is for Everyone. it'll be available in the fall. Amazing. Thank you guys so much. I really appreciate it. Thank you.

The Pomp Podcast - #1532 Natalie Brunell, Marty Bent, Thomas Pacchia | Bitcoin Will Be The Global Reserve Currency

There aren't comments yet for this episode. Click on any sentence in the transcript to leave a comment.