The Pomp Podcast - #1577 Will Clemente & Ben Harvey | The Truth About Bitcoin Treasury Companies

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Starting point is 00:01:00 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 any opinion expressed by Pomp or his guests as a

Starting point is 00:01:42 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. What's going on, guys. In today's episode, we have Will Clemente and Ben Harvey, both of Keyrock. They are here to explain to us about a big report they just put together on Bitcoin treasury companies. They go into what's going on with the premiums, how to think about debt, how to think about Bitcoin per share and the growth that's happening on that aspect of these businesses. And then we even get into the macro environment and worry about things like inflation, interest rates and the frothiness in the market. This conversation is a ton of content you're

Starting point is 00:02:18 probably not going to get anywhere else. So let me know on Twitter once you get done listening, what you agreed with and what you didn't agree with. Here's my latest conversation with Will Clemente and Ben Harvey. All right, guys, you guys just put out this brand new report, Bitcoin Treasuries Uncovered, which obviously is going to get everyone real excited. You talk about premiums, leverage, and the sustainability of proxy exposure. Will, why don't you give us a quick rundown as to this big fat report that I read that had lots of data in it. What are like the main takeaways for people to understand about these Bitcoin treasury companies that are now kind of assaulting Wall Street and public market? Sure. Yeah. What's up, Anthony? Thanks. Thanks

Starting point is 00:02:52 for having us on been a little bit. Yeah, so for anybody who doesn't know, recently I joined Keyrock, a market-making OTC firm. Before we get into it, obviously none of this is financial advice, DRM research, et cetera. I joined both on the corporate

Starting point is 00:03:09 and institutional side, but recently there's been so much talk about these Bitcoin treasury companies that I decided that I'd take it upon myself to kind of get in there with the research team and break down some of these companies a bit more granularity than maybe i have just you know kind of looking through these things at my computer by myself so i work together with with ben who's who's also here from the research

Starting point is 00:03:30 team to put this together so obviously for anybody who's been paying attention both in in crypto or you know kind of the the broader financial markets these you know are getting referred to now as crypto treasury companies have become incredibly you know popular um we've seen obviously the you know initially microstrategy was launched uh back in 2020 which we can get into specifically and like kind of you know the capital structure of microstrategy but um you know we didn't really see any copycats afterwards um but as you know bitcoin's price appreciation has taken place over the last two or three years it's become clear that you know microstrategy is is you know been one of the best performing stocks in the world over the over the last five years um we have seen a ton of

Starting point is 00:04:14 other you know called copycats or you know people that have taken upon themselves to say hey you know the strategy has been proven out um let's let's do it ourselves and so you can't even list on your hand anymore how many of these these companies are and i don't think that was true three months ago so um you know this has been a huge trend in in the markets and uh we decided that we'd kind of do the best that we could to break down these things you know how they work um you know go into kind of the capital structure of these things um you know look through the debt situation across all these different companies, the at-the-money programs, and then also tie this into a probabilistic view of how maybe they'll play out into the future.

Starting point is 00:04:56 All right. So what are the big takeaways as you looked at all these companies in terms of if you had to pick three to five things that people need to understand about these businesses? Yeah. So I would say the first one is that A, it's become an incredibly popular thing. So Bitcoin treasury companies have now accumulated about 725,000 Bitcoin. I think this number is outdated even from the week that we put it out. I think we saw a few more. So DJT bought about $2 billion. MicroStrategy put out another press release this morning that they bought some more.

Starting point is 00:05:28 But at the time of writing, there's about 725,000 Bitcoin, which is equivalent to about 3.64% of the entire Bitcoin supply. Of course, you know, a big chunk of that is micro strategy, but this is on par with the ETFs now. So the Bitcoin treasury companies have now accumulated over half of the total amount of Bitcoin that the ETFs have, you know, accumulated altogether, which is, I think, a pretty staggering statistic. Also, you know, part of kind of our key findings was looking through what's the total market impact of these treasury vehicles. So that's 60 basis points of the kind of daily trading volume or price impact was attributed to these Bitcoin treasury companies on average in 2025. And on certain days, particularly when MicroStrategy bought or now Strategy bought, that could reach all the way up to 9%, which obviously is very substantial. But again, the daily average is about 60 bps, which is fairly material, but maybe not as high as some people would think. I think, you know, maybe people have gotten this idea that these treasury companies are, you know, a quarter or half of the daily trading volume.

Starting point is 00:06:43 It's actually on average been a bit lower than that. So there's one thing that surprised me. The total amount of debt that they have raised in aggregate is about nine and a half billion now, which is a pretty big number. And they've raised about three point three billion in preferred equity. And then, you know, we'll get into, I guess, the kind of individual structuring of some of these different companies and, you know, how they how they kind of differentiate themselves. Ben, why is it only 0.6 percent? That seems like such a low number compared to what people think it is. Yeah, it's a really low number. I mean, you've got to remember that this asset is trading at 50 billion a day. Right. It's huge volume pumping through this thing.

Starting point is 00:07:20 So even though we're talking about up to, I think Will said, 3.84% of the Bitcoin to float into these things, actually on a daily basis, it's not as much as you think. The other factor to remember is a lot of this stuff happens over the counter, right? I mean, if you take, for example, 21 Capital, Bitfinex and Tether, they essentially just handed over a bunch of Bitcoin just to get that treasury allocation started. It's not really all flowing through the markets. But it can push up to 9%. We saw some days when strategies are really, really pushing through the markets,

Starting point is 00:07:55 but they're impacting price significantly. But even 9% seems super low on like the highest days, right? You would think that on some of the highest days, it would be like 50%. Yeah, exactly. But to be honest with you, sometimes they're using different strategies like TWAPs or they're averaging out. They don't want to have too much of an impact on price. I mean, even just for themselves, for getting a better price in terms of that entry.

Starting point is 00:08:17 but yeah you're right it's much lower than people think okay and then did you guys look at all um you know will mention debt how do you look at the use of debt versus equity versus kind of like where the capital is coming to uh to fund these purchases yeah so it's really interesting i mean just studying this stuff the way that they and i should i say they in general but really sailor pioneered this the way that they've securitized bitcoin has been incredible right they've kind of offered everything from high interest debt um all the way through to convertible nodes The difference in some of these structures is whether they actually have obligations in terms of their interest payments and dividends.

Starting point is 00:08:55 You might see a bunch of convertible nodes which actually have 0% dividends or payments, but really the only risk down the line is dilution. But on the other flip side, you've got a ton of people who are raising loads of debt, 10%, maybe sometimes even up to 15% interest payments on those, and they might not be able to service sit down down the line without selling some bitcoin um so what you end up having is like a really different risk profile on some of these assets and then um i saw in the report that strategies bitcoin per share has grown 11x since they started and so that's not 11 it's 11x on an aggregate basis which is like a 60 something percent compound annual growth rate since they

Starting point is 00:09:37 started doing this which is on top of bitcoin's price appreciation yeah this is i think this is the coolest and maybe misunderstood most misunderstood thing about about the digital asset treasury so you said bitcoin per share there's really two metrics that people need to care about it's a now premium and a bitcoin per share so now premium is essentially like if you look at these things today they're trading on average 78 percent above their bitcoin holdings um like a 1.8 x give or take uh mnaf premium exactly right so you're paying like 180 for 100 worth of bitcoin and really people are thinking why on earth would i do that well there's three reasons and one of them is this bitcoin per share very quickly the other ones

Starting point is 00:10:23 are just to demand dislocation um in terms of getting compliant exposure to bitcoin um and volatility which is slightly complicated but we can come to that later uh this bitcoin per share is the main driver right so at the moment um if you were to buy passive spot utf bitcoin it just sits there does nothing right but if you want to buy from something like micro strategy they're using this to create a date in a bitcoin uh this kind of like financial engineering to increase the amount of bitcoin that they have um whilst either keeping chairs the same amount of shares or slowly increasing the amount of shares at a lower rate than they are increasing bitcoin per share and really exactly what you said pump right so they've like 11x in the five years

Starting point is 00:11:08 they've been going 63 kaga um that is what makes the premium acceptable right you can kind of frame it as an investor and say i don't mind paying 80 above the current spot price of bitcoin if they're going at 60 of year and i'm going to hold it for three years like i'm going to be in the money in Bitcoin terms, not even just in US dollar terms, which is really the interesting thing about these products. And so in a weird way, these Bitcoin treasury companies, I think people initially had pitched them as a way to get exposure to Bitcoin. Obviously, there's spot Bitcoin, there's ETFs, there's kind of a whole plethora of different ways people can get just plain kind of exposure. Really what it sounds like you're saying is that these Bitcoin treasury

Starting point is 00:11:51 companies are accumulation machines. They are figuring out how to accumulate more and more Bitcoin per share, which is ultimately the thing that the shareholders are benefiting from on top of just the directional movement of Bitcoin. Yeah, that's exactly right. I mean, I heard with obviously it's not just Bitcoin now, right? These things are like the fastest institutional land grab in crypto ever. And it's not just Bitcoin anymore. It's ETH and Solana. I heard, I think one of the founders of one of the Solana ones, maybe DeFi Dev Corp or Soltax is saying And this is the equivalent of rather than swimming down a stream, you're on like a speedboat down that stream. You just put an engine on the back, which is that financial engineering, right?

Starting point is 00:12:32 And suddenly you're accumulating the underlying assets. I mean, way far than you would if you were just putting your paycheck in every month. Yeah, well, how do you feel about the Bitcoin treasury companies versus some of these altcoins? It feels like, of course, people are going to go do it. But is there anything different to evaluate with the altcoin ones versus Bitcoin other than, you know, just Bitcoin versus the underlying coin? Like, are there other considerations? Yeah, I mean, I guess a few things. You know, one is just the, you know, if you go out and read, I don't know, like nine figures for, you know, a coin that's maybe outside of the top five, top 10,

Starting point is 00:13:08 then you're going to be a much, much higher portion of the volume than the like 60 bps on average that we're talking about all of these Bitcoin treasury companies are. because they're just much, much smaller assets than Bitcoin. So, you know, the benefit of that, of course, is that, you know, that for people that are looking for exposure to the underlying, that, you know, might be beneficial for the price action. But, you know, it might be a bit more constrained on the margin, you know, in terms of liquidity and, you know, execution, as well as, you know, in theory, if the market rolls over,

Starting point is 00:13:38 going back the other way. The other component, which I think, you know, we can get into for both uh the bitcoin as well as the the broader the broader treasury uh companies for the for the other coins as well um the proof of state coins obviously you know are proof of stake so you're able to you know generate yield on them um i think this is this has been something that um you know tom lee and and uh and lubin have been really really pushing on the on the east front as kind of a narrative of if you're able to generate you know yield on on the east that you have staked or whatever other proof of stake asset and then you're able to kind of use that income

Starting point is 00:14:14 uh to service any like interest payments or if you have dividends on on uh preferred shares that you've issued whereas you know obviously with bitcoin being proof of work you don't have that um and this is a whole another discussion about you know we uh we you know we kind of break down a couple of the different you know uh structures of these things so some of them you know you look like look like a micro strategy um i guess we can i guess we can just fully get into it So they have several different offerings. They have STRK which has 8% dividend. It's convertible to MSTR and then also has a cumulative dividend. STRF has a 10% dividend. It's cumulative as well, but non-convertible. And then STRD, which is a 9% dividend, which is non-cumulative,

Starting point is 00:14:59 almost like a junk debt. So they have several different preferred share structures now. They have the common stock program where they're just issuing shares at the money, as well as the convertible notes that they've issued. Then we also have things like MetaPlanet, where they're taking advantage of essentially putting on a short Japanese bonds, long Bitcoin trade by basically taking advantage of the fact that Japan is subsidizing their bond market via yield curve control. Um, but you know, for some of these other companies, you know, maybe we'll mention individual names, but there's some that are strictly saying, you know, Hey, we're going to spin up an entity and then we're just going to issue, you know, common stock and something like that is, is strictly relying on this idea that you're going to have this perpetual premium, um, to nav that, that you're able to, to withstand.

Starting point is 00:15:58 Um, and you know, if that kind of reflexive loop starts to, starts to lose momentum, then could be problematic for those types of structures but what we're now seeing to tie it into your question about you know the the altcoin uh structures and the thing i mentioned about like each staking uh now there's kind of this conversation around these things of can you acquire use use the bitcoin on the balance sheet that you've that you've taken on and can you go out and acquire even you know even say short-dated treasuries right and pull in some sort of yield or go out and purchase cash-flowing businesses to then use that to service any debt or dividend payments that you have to make. I think for individual investors, now all of a sudden,

Starting point is 00:16:43 that adds a whole other thing of, hey, now you have to underwrite the execution ability and the quality of the management as an investor, which is a whole perhaps different skill set in some circumstances perhaps than being able to structure a Bitcoin treasury company. So that's something to consider. But now we're starting to see some conversations around, hey, can we take Bitcoin and collateralize it? We have this maturing lending market around Bitcoin as institutions are coming in. Can we use that to acquire cash-flowing assets? And this is, I think, a very interesting perhaps next phase for these things. Now, Ben, when you take a look at some of the capital that's coming into this, did you guys have a chance to look at how much of that capital is

Starting point is 00:17:33 hedged? That's one of the things to me that feels like these equity investors who are pouring capital into these companies, some of them want long exposure to the stock. Some of them want exposure to the premium, but not necessarily to the movements of Bitcoin or anything on that front. And so what did you kind of take away on that end? Yeah, so it's interesting. I mean, the first thing to state is that $8.2 billion worth of strategy is offering which through convertible debt, right? And I think it's gone up even just this morning before we started recording,

Starting point is 00:18:05 but it was about $10 to $15 billion that's been raised across this base. So that's a huge portion, right? And a lot of what's going on there is convertible debt arbitrage, right? So MicroStrategy has, I think it's even in the top 86 percentile for open interest in options. It's above Microsoft. It's absolutely huge in terms of options, open interest. And what that opens up for these convertible debt arbitrage is the ability to pick out different parts of the option profile that they want to be exposed to. Now, the convertible debt, we can break it down into a bond and then a call option, essentially. what these arbitragers are doing is going short everything other than volatility so they're

Starting point is 00:18:50 hedging out delta they're hedging out duration the works um and they're just going long vol because typically the convertible um debt instruments their volatility is much price way lower than the actual real volatility suddenly when vol spikes up in the market we're seeing a premium on these kind of debts shoot through the roof which creates a bit of of a flywheel effect, right? Because then Jatsi or whoever else can go and harvest that premium, increase their Bitcoin per share.

Starting point is 00:19:19 And then suddenly that premium goes up even more because people think, great, I can afford to pay more of a premium for future growth, right? So you get this kind of flywheel effect. To answer your question, it's not clear exactly how much of it is hedged, but I wouldn't mind betting

Starting point is 00:19:33 that 8.2 billion right there is hedged. Got it. And then Will, one of the things that I think most people who are looking at this who are asking themselves how much of the performance of the Bitcoin treasury companies is Bitcoin? How much of it is just like a macro enthusiasm? Because we have NASDAQ and S&P

Starting point is 00:19:49 and everything kind of hitting all time highs. And then how much of it is people don't understand what's going on, right? And they're just kind of blindly buying things and it's all froth and a big bubble. How do you think about like the main drivers for these businesses? Is it something that's rooted more in Bitcoin

Starting point is 00:20:03 or is it something that's rooted in this idea of enthusiasm in the stock market in general? And these businesses are kind of a big beneficiary with an MNAV premium that people then are harvesting to go buy more Bitcoin. Today's episode is sponsored by Figure, the largest non-bank home equity lender in the United States with over $15 billion

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Starting point is 00:23:57 Yeah, sure. Pretty loaded question. I guess, you know, this might be a good segue into maybe just talk about, you know, the broader market as well. Yeah, I think, you know, Bitcoin has done well because we've had these tailwinds over the last two months that have formed for a variety of reasons. And these treasury companies have been seen as a way for people to get cheap leverage or beta. So getting increased exposure to the underlying of Bitcoin, for sure. There's a variety of factors that we talked through in the report in terms of the capital structure you know something like micro strategies got to the bear market anthony and our previously uh you know in research firm we put out a report on micro strategy within a month at the bottom and

Starting point is 00:24:48 said that they'd be okay and i think back then you know a lot of people were saying they're going to go bankrupt and stuff and so for anybody that you know understands the capital structure of micro strategy you know i think they're they're probably more fortified than than some of the other guys um and then you know frankly i would say another component is you know who can you who can you put together that's you know kind of bringing this thing to market in terms of you know distribution as well that that perhaps is has become a factor um but yeah maybe we can like use this to segue into uh into the broader market so you know i guess to touch on kind of the macro situation and um you know the backdrop for the last couple months so we go back to you know pre

Starting point is 00:25:27 april um heading heading into april um you know the trump administration had been very vocal about basically saying hey um you know we want to try to get yields down the way we're going to do that is potentially by you know triggering some economic weakness um we saw you know very very sharp correction um and then that got exacerbated by kind of a you know shock around around the tariffs but within a week we saw the bond market seize up you know the the move index which is you know the volatility measure for uh for fixed income blew out um and so you know that's that's you start to run into you know some issues um you know in terms of you know now a lot of these systematic funds are basically just like short volatility and so um that caused a lot of a lot

Starting point is 00:26:09 of you know positioning online um but then you know very briefly after you know trump said it wasn't the bond market it seems like that you know probably isn't true to be honest um did it basically a complete 180 from you know him and best and talking about hey we're going to cut spending and do all these things. So now it's, hey, we're going to run everything as hot as possible. And so now we've gone from, hey, we're going to pull back on spending to we're just going to juice everything. And so now we're no longer cutting spending. Fiscal policy continues to be loose. The Fed obviously hasn't hiked rates. And there's also a decent likelihood that we may see rotate the allocation of bonds from the long end to the short end, like Yellen did, even though

Starting point is 00:26:58 he gave Yellen a hard time, which is stimulative. And we're doing all this into credit spreads being low, the stock market's fine. So they're really exacerbating everything. And that's caused people to go out further on the risk curve. And that's exactly what we've seen. So obviously, you know equities have done well um you know bitcoin's done well um we've seen you know gold consolidating but gold looks like it's you know kind of putting in a bit of a bull flag for people that are you know a bit more oriented towards like ta um and then you know recently we've seen a lot of the you know kind of far tail crypto um stuff pop off this is just classic you know we see bitcoin run up we've seen this rotation into eth over the last week um now we started to see you

Starting point is 00:27:45 some of the even further tail uh go crazy over the last you know couple days obviously this stuff you know can go on for you know longer than than you know you feel like it can um but i would say you know in terms of at least on the crypto specific side um you know at this point with bitcoin broken out to all-time high you know i i played all-time high breakout on bitcoin i was you know extremely probably the most long i had ever been on on btc pre-all-time high break but i've taken some of that off and you know one of the things that has me um you know obviously not i never short crypto but you know as me a little bit hesitant to pile into you know the super far tail here um in like any prolonged you know period of time just like running stops tight on anything

Starting point is 00:28:27 that i do in my personal account because if you look at um you know one indicator i really like to look at for froth now is uh the altcoin open interest dominance so this basically looks at like the total amount of futures open interest on Bitcoin, ETH, and then alts as well. So like all the far tail risky assets. Whenever the percentage of total open interest for futures and crypto alts flips that of Bitcoin, so basically anything non-BTC or ETH, that's been a very good local top indicator on like a couple of week basis. I posted this last week and today, just a week later, it already is getting close to close to crossing, I'd suspect that that's probably going to take place within the next

Starting point is 00:29:12 week or so. So you've got to play the music while... You've got to dance while the music's playing. But things are definitely heating up. I think people used to look at... I used to look at funding rates or the futures basis as an indicator for fall. I don't think these things are as good of indicators anymore because you just have a lot more sophisticated market participants that are arbitrage and funding so they'll you know go long spots for the futures you know same on the on the data futures as well especially on like cme they'll go long spots for the future capture the capture the basis so you know i like i like this all coin opening uh open interest dominance thing as a kind of uh you know measure of froth in the market um obviously the the treasury companies

Starting point is 00:29:59 have been i've been adding to that but i don't you know frankly i don't think it's it's it's quite clear what exactly is going to cause them to unwind you know and to go back to the report you know specifically on these things you know we we broke down probabilistically you know the ways that maybe some of these things can play out um my personal take i don't know if ben disagrees with me is that i think these things will likely become a victim of their own success you know when you have a certain amount of money that's coming into into these assets but you know you have a huge influx of the total amount of supply you just you just end up diluting the flows across the board and you know again it's hard to quantify like what exactly is that amount that that you

Starting point is 00:30:39 know it dilutes um and you know something like you know the converts might be tapping into a different type of market participant than you know just these at the money issuances for like you know the far tail altcoin you know treasury vehicles for example um but you know i think i think that's that's that's a sign of the froth indicating again i just i don't know it's it's to say like what what is the um you know what is the catalyst for these for these things to unwind um it's tough to say i think from uh from like a macro perspective that i guess the last portion you know to tie it into what i was saying earlier about them juicing everything um you know i'm in the i'm in the camp that i think inflation probably picks up towards the

Starting point is 00:31:18 back half of the year uh it's hard to say you know is that caused by by tariffs anything i know you you know you have a stance on that specifically but i generally think that um you know inflation picks up towards towards the back half of the year just because we're juicing everything the wealth effect from from stocks you know uh you know household uh ownership of stocks is you know at all-time highs um even though it's concentrated in you know the more wealthy you know part of part of the you know the population it's still at all-time highs so you know when stocks are going up there's more money you're coming into the system um and then you know people spend that that back into the economy, reducing everything with asset prices near all-time highs and credit

Starting point is 00:31:56 spreads being very low. And I think you've got both inflation swaps, so inflation-protected securities, as well as the yield curve. So the spread between shorter-dated treasuries and longer-dated treasuries is starting to break out after consolidating for the last month or two. And so I think all these things are pointing towards a higher likelihood of inflation picking up. So from my perspective, again, like I said, I took some of the leverage off that I really put on as Bitcoin started to break through all-time highs, but obviously still have a core Bitcoin position.

Starting point is 00:32:35 I like gold here, and I don't like bonds. I think bonds are in quite a predicament heading into the back half of the year. You know, we had this kind of window of, you know, weak data that I think brought yields down, you know, in June. But, you know, we've gotten through that with NLP data. And, you know, I think we've kind of, you know, resolved people's concerns about the economy specifically for now. I think, you know, the main, you know, we've also started to see, you know, PPI came in soft last week. But when we include imports, you know, you see core goods are starting to pick up as well. But I think the final hurdle for yields is with FOMC coming up, but the day before that,

Starting point is 00:33:16 we have the QRA. And so this is when Scott Best, the head of the Treasury, is basically going to talk through how he's thinking about issuing US debt for the coming quarter or so. And so there's a chance that he goes full Yellenomics and says, hey, we're going to issue everything at the short end of the curve, which I think is short term, you know, you're bad for or good for, you know, yields, yields coming down, but over the over the long term, you know, like, you know, think of 2030 years, whatever. Yeah, I think this is bad for longer term inflation expectations, because again, you're just further further juicing things.

Starting point is 00:33:57 So, you know, I think the bond, the bond piece is the tougher of the three, because you, you know, you're kind of going against the government, which has these levers that can pull with, with that, or the SLR exemption stuff. So, you know, lowering the collateral requirements for banks to be able to, you know, buy bonds. But, you know, overall, I think, you know, I definitely wouldn't want to be long bonds, but I'm, I'm, I have a small, well, I don't want to say small, but I have this, you know, low,

Starting point is 00:34:24 low double digit percentage of my portfolio is short bonds with like kind of a, you know, three to six month time horizon. But if we get through the QRA and we don't see Besson increase issuance to the shorter end of the curve, I would expect that that could start to pick up. So all I have to say, I'm kind of agnostic to the far end of the risk curve for at least crypto stuff on a couple-week basis just because things are getting so frothy. But if I was going to close my eyes and had to put my positioning together for two months and couldn't do anything, it'd probably be long Bitcoin, gold, and short bonds. Ben, anything that he said that you either disagree with or you think you should add? No, I think he definitely hit a point. If we're looking on chain, which is mostly what I'm doing day to day, we're seeing most of that play out.

Starting point is 00:35:12 I mean, if you just look at what NFTs were doing this morning, I think 10 million worth of crypto funds were swept. We've seen gray oils like Ringers, Fidenzis, everything suddenly start to pick up over the last week or two. And that really does tie into what Will was saying in terms of the way that risk is kind of shifting from majors into alts and then maybe a little bit farther out. I mean, alts is an indicator of flying up. It's just another way of expressing the alts ROI. And that's something I've been paying a lot of attention to. Got it. And then when you think, Ben, in terms of the Bitcoin market, one of the things that's interesting to me is Bitcoin dominance.

Starting point is 00:35:52 I think it bottomed somewhere in the low 30%. It shot back up over the last two or three years to over 60%. What is your expectation for where could it fall or grow to in this bull market? Yeah, good question. I mean, I think the way that we're headed, it's going to start to come back down, especially if you look at the HBTC chart and then even like Seoul ETH chart, right? Those two look primed to pick back up significantly. I think it probably comes down maybe even by the end of this year, early next year, in the low 40s kind of range is where I'd expect to see it.

Starting point is 00:36:31 I haven't paid too much attention as we go off the last few days. I'd imagine it shifted around a lot with that East price action. But those are kind of the two kind of areas I'm looking at. Got it. That makes sense. And then is there anything on the interest rate side that either one of you guys thinks is interesting in terms of – obviously a lot of pressure on Jerome Powell and the Federal Reserve to cut rates. He's done a pretty good job of resisting that pressure. But you got to imagine in the second half of the year, there will be at least one rate cut, if not more. How do you guys anticipate that playing into

Starting point is 00:37:00 Bitcoin in particular? Yeah, I mean, I think, you know, to tie things back in kind of like what we were just talking about, you know, I think when you when you zoom out, you know, maybe this is a bit more esoteric but i think the federal reserve is no longer likely to exist in the same way or fashion that it has uh you know maybe over like the last i don't know decade two decades several decades um now i think the the fed's mandate will no longer be to manage inflation and price stability as much as it will be uh to help manage the united states's debt situation um and so you know i think some of this rhetoric coming out of you know trump uh for example if this is like borderline like emerging market stuff that we're talking about right like firing the fed chair so

Starting point is 00:37:55 that the president can dictate what you know uh interest rates are going to be um you know effectively you know trump's trump's almost like trying to double forward guidance the fed because he's saying hey i'm going to put my guy in in six months and he's going to cut rates so forget what these guys are doing because the market's forward looking so you're going to start pricing in what my guy is going to do in six months and override the forward guidance that the current fed chair is providing um of course there's a whole there's a whole fed committee but i think i think going forward these the lines between you know the treasury the fed will get blurred a bit because you know we kind of have to right you kind of need this like cohesive work together between

Starting point is 00:38:40 these two entities to help massage things to help help service our debt situation and i think part of that is ultimately you know we're trying to grow our way out of it which is like the rhetoric that the trump administration has pivoted towards but we also we need inflation to help service the debt burden. And so I would, I would suspect that, um, you know, slightly, slightly higher levels of inflation for the, for the coming decade, or at least, you know, five years or so, maybe, maybe the, maybe kind of the new norm. Got it. And then, um, in terms of the report that you guys put together, uh, where can people go find this thing? Sure. Um, yeah, it's on the QROC website under the, uh, the research tab. Um, so, you know,

Starting point is 00:39:20 Ben and the research team, you know, put together a ton of great stuff. I just happened to find this specific topic interesting so i hopped in and helped out on it um he did a lot of the heavy lifting um so there's a ton of stuff on there you know no email walling um so you know if you uh if you enjoy this uh your conversation be sure to go check it out in more detail a ton of graphs in there and visuals things like that it is uh it's very dense in in a positive way ben so i don't know uh i don't know if you like sat down one night late at night and just started banging it out or what but uh um i read it and it is uh it's pretty incredible in terms of the level of detail but i think also um there's kind of the narrative but all you know the data that you include is uh

Starting point is 00:40:02 is pretty compelling as well so you did a fantastic job of putting this together thank you got to hear it absolutely all right caffeine huh a lot of caffeine yeah well that that's uh i think that's what everyone uh would expect is a report like this doesn't get written without something stimulating your brain. That's right. All right, guys. Thank you so much for taking the time to do this. We'll do it again in the future.

Starting point is 00:40:25 All right. Thank you, Anthony. Thanks, Bob.

The Pomp Podcast - #1577 Will Clemente & Ben Harvey | The Truth About Bitcoin Treasury Companies

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