The Pomp Podcast - #464: Mitch Garber on Understanding Bitcoin

Episode Date: January 6, 2021

Mitch Garber is an investor and entrepreneur from Canada. He was previously the CEO of Caesars Interactive Entertainment and has served on the Board of Directors of Cirque du Soleil, Caesars Entertainment, RackSpace, Shutterfly and many others. In this conversation, we discuss Mitch’s numerous business successes, how he currently invests his capital, and then we dive deep into his questions around Bitcoin and cryptocurrencies.  ======================= The Stacks 2.0 mainnet is launching on January 14, 2021. Stacks, which you may recognize as Blockstack, is a layer-1 blockchain that uses the Bitcoin blockchain as a secure base-layer and enables developers to harness its power in new ways. Stacks makes Bitcoin more than digital gold, enabling apps and smart contracts on Bitcoin--unlocking innovation, new value, and a new way to earn BTC. Register for the mainnet event here: https://stacks2.com/ ======================= Coinbase Wallets are adding support for .crypto and .zil domains through their partnership with Unstoppable Domains. Unstoppable Domains provides an all-in-one solution for blockchain domains. You can send money using these new domains instead of long Bitcoin wallet addresses, while also storing your domain in Coinbase's collectibles section. Go to unstoppabledomains.com in the dapp browser to register and manage your domains.  ======================= LVL is a new crypto investing platform that I'm an investor in. They allow anyone to trade an unlimited number of times per month for free. They have no trading fees and no spreads in the spot market. If you buy or sell more than $500 in Bitcoin on any exchange, you're spending too much on trading fees. Use LVL to save money and trade as many times you want. https://lvl.co/pomp =======================

What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Let's kick this thing off. Mitch Garber is an investor and entrepreneur from Canada. He was previously the CEO of Caesars Interactive Entertainment and has served on the board of directors of Cirque du Soleil, Caesars Entertainment, Rackspace, Shutterfly, and many others. I really enjoyed this conversation with Mitch. In it, we discuss Mitch's numerous business successes, how he currently invests his capital, and then we dive deep into his questions around Bitcoin and cryptocurrencies. I really hope you enjoy this one. Before we get into this episode, though, I want to quickly talk

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Morgan Creek Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only. All right, guys. Bang, bang. I've got Mitch here with me. Thank you so much for doing this, sir. Thanks. Thanks a lot, Paul. For sure. Let's just jump right into your background. You've had this great business and investing career, but a lot of people probably aren't familiar with how you got started. Where did you grow up and how did you get into business? Yeah, thanks a lot. Well, I mean, we'll go backwards. I'm 56 years old today. So

I grew up in Montreal in Canada. I live there now because there's been a lot of stops in between. But I went to college in Montreal, went to McGill University. I went to law school at the University of Ottawa. And I practiced law for nine years. And I sort of got very lucky. I was a lawyer in the early 90s. So 96, 97, the internet starts. And I read an article by Roxy Roxborough talking about a european sports book on the internet that um i thought was really interesting i ripped out the article it was an actual real physical world article in international gaming and wagering business magazine um and i found the owner of that company in austria and i called him and um i said i wanted i want to figure out some way we can do business together because i see that you know

you're trying to do business over the internet in gaming i was a gaming lawyer representing IGT Caesars at the time uh even though I later on hooked up with Caesars it was unrelated so I was a gaming where doing gaming related law gaming was exploding in the 90s uh every state and every province was getting casinos um but I saw the internet I read this article by Roxy and um when I finally spoke to the owner of this this sports book what he really needed was payment processing and so I called a friend of mine in Montreal who was a really well-known business uh well business couple, two guys, and they owned an internet service provider. And they, I told them, listen, I need to find a way to process payments for this sports book in Austria. At the same time,

I offered him my services to help him get licensed in Antigua, which I did. And so these two guys started a little payment processing business in the back of their service provider. And a few years later, I left my law practice and joined them. The company got bought by Bell Canada. We got tons of stock in this e-commerce subsidiary of Bell. We did very well. We spun out the payments business. We created our own public company. We grew it.

We sold it to a NASDAQ company. It grew again. I later left it to run Party Gaming. But this payment processing company today is called PaySafe. And it's got an $11 billion market cap. So the guys who started it, myself and these two other guys, it's been through a couple of different, I guess, versions of itself. But that business that started by processing the sports book payments in and payments out

of an Austrian sports book in 1997 is today the $11 billion Paysafe that just went public in a SPAC by Bill Foley, the owner of the Las Vegas Knights. So I got my start as a lawyer, a gaming lawyer, got into payment processing, got into the internet quite early, was offered the job as the CEO of Party Poker, Party Gaming. At the time, it was a $10 billion company. I moved to Gibraltar with my family. I ran that business for two years. During those two years, the Unlawful Internet Gaming Act passed in 2006 in America.

I turned off the US part of our business, which took the business from a $10 billion market cap to a $2 billion market cap. I learned a lot. We recovered very well. The stock did well. The shareholders did well, notwithstanding having to turn off a substantial amount of the business. And I met Mark Rowan, one of the founders of Apollo.

and he and David Bonderman who co-owned in their firms TPG and Apollo they co-owned Caesars which was 50 casino properties around the United States and elsewhere and they asked me if I was interested in starting a digital uh subsidiary of Caesars and owning the World Series of Poker so I'll stop now but that's sort of the the start of my career is as a lawyer and then payment processing and gaming was in my life um until party gaming when I left party gaming and I I I did start this subsidiary of Caesars and I guess the rest we'll talk about. Yeah. So when you go to start that subsidiary, what's so fascinating to me is you essentially go from practicing law around gaming to running a company and probably dealing with one of the

most catastrophic things that could happen in terms of having shut off the US business and then really kind of jumping full in to a US-based business, right? And kind of saying that we're going to go do digital gaming. What was so exciting about kind of coming to the US to do this? Was it, you know, Bonderman and Apollo and kind of the players? Was it the opportunity? Was it just you were going to get an opportunity to kind of build a skill set and experience? What really drove you to say yes to it? You know, I think number one, I felt that I had made the money that was going to make me happy and comfortable for the rest of my life. And so I wasn't going to be driven by money. I love the idea of working with Bonderman and Rowan and Apollo

and TPG. And the Caesars brand always resonated with me because I was someone who knew a lot about gaming and knew a lot about gaming law. And so to be able to be sort of wrapped in the Caesars Palace brand and the Planet Hollywood brand and the World Series of Poker brand, I thought that was a great opportunity for me. We thought that poker would become legal in the United States. We'd own the World Series of Poker and we would make a lot of money for our shareholders and our shareholders. That turned out to not be the case. But I think your first intuition is right that I saw this opportunity to to be with around bonderman and rowan and this group gary loveman who was the ceo at the time and i remember that when i started working there um i went to bonderman and rowan

both separately and i told them what i really want is that if i'm successful here so 2008 if i'm successful here um i'd like to be in your ecosystem afterwards i'd like to be able to invest with you i'd like to sit on boards and they both said that sounds like a good idea i don't know at the time if they were, you know, thinking that this was serious or not. But as it turns out, it's 12 years later and that's what I do. So I saw the opportunity to be around people that I thought could really help me in my life if I, and I could help them as well, but to be around them, it was being around winners actually, you know, it's kind of like if I could, you know, play for the Golden State Warriors two years ago, that would be, you know, that would be awesome. So I felt like, you know,

I was maybe the last man on the bench, but I was playing on a great team and I was happy to be there. Yeah. And in terms of as you get that business started, kind of tell us the story of starting it all the way to when you decided to leave. Yeah, what happened was, you know, from 2009 to 2010, we were very hopeful that we would get legalized online poker, we ran into Sheldon Adelson, who didn't want internet poker. And he had a lot of, you know, the way the US political system works, I think you know it very, very well. But these super PACs are pretty powerful. and you know I believe that Sheldon made sure that internet poker didn't become legal because he wasn't ready for it didn't understand it and didn't want it

and so once we realized that we realized I hate to use the word pivot but we knew we had to pivot because I had a meeting in December 2010 with my management team I said guys listen I don't think that you are going to become wealthy running the world series of poker and if we don't find something else you're all going to look for something else because look it's the wild west world is young you guys are young guys um and so we started looking around and we saw zenga poker and we saw farmville and we said hey you know what why would zenga poker not want to be you know involved with the world series of poker and add that brand to their to their social game at the time it was mostly on facebook it wasn't a mobile game and so we went down we finally got

a meeting with them they didn't take us that seriously we met with mark pinkis he didn't take us seriously he might say differently today but he didn't take us that seriously And he didn't really want to do much with us. And so as we left the meeting with Zenga in San Francisco, we said, OK, now we're going to do it ourselves. Now, I had a lot of experience in Israel. I speak Hebrew. I lived in Israel.

I said, listen, Israel is a great hub of game development. Let's try to find something there. And lo and behold, a friend of mine asked me if I had heard of a certain company, which I had not. The company was doing run rate of about 10 million of EBITDA with 13 employees in an apartment in Tel Aviv. I flew to Tel Aviv, sat in the apartment and met with the guys. I fell in love with them and went back to the board at Caesars, you know, an elder elderly, an older board, you know, a board of Barnum and people of his generation and explain to them, I want to buy this social games company where people are playing games just for fun. and they'll buy coins just to add, you know, to the experience, but they don't have any chance to redeem them or win anything. And I want to pay $100 million for this business, which was 10 times EBITDA. And actually, you know, I could make the story sound more exciting, but they said,

go ahead and do it. And we went and we bought that company. And that company has done spectacularly well. Four and a half years later, we sold it to a consortium in China, including Jack Ma's family office for $4.4 billion. And now it's four years later, they've issued their S1 and they'll be public in two weeks at about an $11 billion market cap. So bought it for a hundred, sold it for 4.4, same management team stayed there. I didn't, I stayed at Caesars to finish a couple of projects I was working on. And those guys have done incredibly well and I'm very proud of them. So Playtika will be public in New York in the third week in January, probably around $11, $12 billion market cap. So a really amazing story. And the money that Caesars earned from that sale,

they used to settle with the creditors of Caesars parent company, which was in restructuring at the time. So it's a really good story for just about everybody, the creditors at Caesars, the shareholders, stakeholders, my management team, myself, and now once again, the management team and founders of Playtika. Yeah, it's an amazing story. And so obviously you kind of continue to do the work at Caesars. Eventually you leave and you now do a whole bunch of stuff, investing. You sit on a couple of boards. I've really enjoyed getting to know you. Let's maybe talk a little bit about the board of director positions that you hold. Two of those are Rackspace and Shutterfly. This year, or really 2020, has not been the most fun

year to be running businesses that potentially could be impacted by a global pandemic, government mandated shutdowns. Talk us just through, as a experienced board member who's previously run pretty large companies and had a lot of success, what were those conversations like over the last year with executives? And kind of what were the things that you were thinking about or you were really hoping that executives were paying attention to at some of these larger companies? Yeah, well, you know, first of all, there's a great amount of luck here, right? So I'll start with the worst experience. I also helped TPG buy Cirque du Soleil and I was the chairman of Cirque du Soleil and I had a multi-million dollar investment in Cirque du Soleil. And the Cirque

is now 300 days into zero revenue. So from a business that generated close to $2 billion of revenue, it's been at zero for 300 days. It went into restructuring. It's now owned by its lenders. So those conversations were very, very difficult because we couldn't figure out a way that you could actually sustain yourself at zero revenue and service the debt. So you always will have a contingency plan. What if we lose 20% of our revenue? What if we lose 30% of our revenue? What if we're shut down for a month or two?

It's very difficult to foresee a situation and be prepared for a situation where you have 6,000 employees and you're out of business. I think the circle will be out of business for a year and a half. So that was a really unfortunate situation. Of course, I did learn a lot. We made some decisions, but there were none that we could have made that would have made it into a success. And that's what I'm talking about when I talk about good luck, bad luck. If this would have been an internet virus and not a human virus, and Google was down for a year and a half, and all the internet cloud companies were down for

a year and a half, well, live entertainment would be thriving and the internet wouldn't be. So that was on the negative side. On the positive side, of course, I'm in Rackspace, a cloud services business, you know, couldn't be better. Had the best year in the history of Rackspace, went public again. So we took it private in 2015, took it public again about two months ago. Have a phenomenal CEO. And, you know, the decisions there were, if we need to invest in the business to accelerate the growth, let's do that. Let's not just sit back because the cloud is growing and try to have the highest margins possible with, you know, with short-sightedness. Let's have real foresight. Let's make sure that we're here

after the pandemic as a high growth cloud services company. And Kevin Jones, who's the CEO, is doing a great job. In the case of Shutterfly, we weren't exactly sure how we were going to be impacted. On the one hand, we have a business where we're the largest procurer or taker of high school graduation and college graduation and church photos with a company called LifeTouch. So, of course, there were hardly any school photos. But at the same time, the amount and the volume of photo books and other merchandise that we sell through Shutterfly has really been astounding. So we've had a great year in Shutterfly. People are stuck at home. You know, the average person, I don't know this, I'm making the number up, but the average person that I know, okay, so if I asked you, Pom, how many photos are in your phone right now, the number is probably like 10,000. A lot of people have 20,000. Most people have 2,000. And they're disorganized. And so people have had a lot of time. And we've seen that because they've taken and used that time to upload photos and create photo albums, mugs, pillows, calendars, Christmas cards, et cetera. So, you know, I think that it's more a matter of luck than the decisioning, because at Shutterfly and Rackspace, we didn't have to pivot.

um at at Cirque du Soleil we couldn't pivot and again luck struck us at the Seattle Kraken where I'm on the executive um board of the Kraken and in the ownership group with David Bonderman and Jerry Bruckheimer and Andy Jassy um and I guess you could say we've gotten lucky we start in October 2021 and so we haven't had to go through this partial season no fans uh we launched our team name. We launched the team logo. We launched our merchandise very successfully. We're second in sales only to the Tampa Bay Lightning because they won the cup. And then we'll have the draft in July. And two days later, we'll have the NHL entry draft. So, you know, I think you have to have a really strong board in all of these situations. And I think you have to play to

your strengths. And, you know, I said, like I said, I've been in more lucky situations during during the pandemic, then not. At the same time, you have to have a lot of empathy because the whole world's not in the cloud. The whole world is not Chamath and David Sachs and Elon Musk and Pomp. And the whole world is not in Bitcoin and blockchain. You know, the world is construction workers,

restaurant owners, hotel workers, service people, stuck at home, school teachers. So yeah, I think it's just been a very interesting time, not only as a board member investor, but just as a human being. For sure. We're going to talk about Bitcoin in a second. But before we get to that, you've been around the same people for a decade plus at this point. And you've mentioned some of their names now. Talk a little bit just about how important it was for you and for your career

development, kind of the success that you've had to not only one, surround yourself with people who you admired, you found successful or kind of the winners that you described, but also to do it for a long period of time. So not just, hey, let's work on one thing, but to continuously work with the same people over and over and over again, over a decade. Why do you feel like that's been so important to your success? First of all, I'm watching you and I see a lot of myself in you or you and me. We haven't known each other for long, but I see that you do a couple of things. Number one, you value the networking without seeking to benefit necessarily from the network, even though you know you will. If you meet Jim Cramer and you meet Elon Musk, at some point, it probably

will be good for you. But you don't have this preconceived notion of how am I going to leverage my relationship with Elon Musk or Chamath or whomever. I think that's important. And the second thing that I find that you do that I think is important is that you've taken a couple of areas of business and you know them as well or better than anybody else. So if you value relationships and you don't seek to benefit from them necessarily. And so they're authentic. I think my relationship with Vonderman is authentic, with Dan Gilbert's authentic, with Mark Rowan, it's authentic. They happen to be the billionaires. I have lots of relationships with people who are in the fourth level of management in companies and have been with

me since 1999 or 2003. And I value their friendships and their relationships and their loyalty. And we've figured out a way most of the time to actually make money and have success together and we figure out a way to deal with uh failures disappointments and and and the like um and i feel like you know i've tried to know as much as i can about the things that i'm i'm involved with today it's a bit more difficult because i don't know more about digital photography uploading than the people who work at shutterfly and i certainly don't know more about you know service cloud services business as the people at rackspace but um i think it's important when i was the ceo of companies, you know, that I had, that I had the knowledge and the trust of the people who

worked for me that I was working at least as hard as they were. And so I feel that the Bondermans and Rowans and Gilberts and Lovemans and the like, they recognize my work ethic and hopefully they find me authentic. And we found interesting, fun ways to work together. You know, I once said to Bonderman, I said, and Jim Coulter is another one who I just adore and Devesh Makan at iconic um who manage a large amount of our of our family assets today um i said to bonderman one day i said you know david you're worth four or five billion dollars why are you and i making investments where you know we're each investing a million dollars or even half a million dollars and his answer was the most beautiful answer ever he goes i just want to be in interesting deals

with people i want to be in deals with and so that told me everything you know he doesn't have to write a 20 million dollar check to make it exciting just wants to be in an exciting business with people that he likes. If it's a half a million or 25 million or 150 million, he just wants to be there. And that's how I feel. So if my check is 50,000, 500,000, a million, 5 million, I want to be there with the people that are in it. And we share kind of those same values. Yeah. That's a great way to look at it. Before we talk about Bitcoin, you mentioned Iconic and a number of the investments you've made. Talk through a little bit, just how you think philosophically about managing your wealth and investing in

general. You obviously trust the folks at Iconic, and then you do some of the direct investing. Is there a certain philosophy or approach or framework that you use when you think about, how do I actually invest the money that I have? Well, first of all, I feel like I'm surrounded by people who know much more than I do about many of the investments that I have. And so I'm better off to rely on Iconic's due diligence in getting into Snowflake and then participating in the co-invest of Snowflake. I'm not smart in having a big investment in Snowflake. I'm lucky to have a big investment in Snowflake. I'm smart to trust Iconic. I'm lucky to be in the ecosystem of Iconic. Iconic's a big shared family office and they manage a lot of Mark Zuckerberg,

Sheryl Sandberg, Dorsey, Bonnerman, Mattel. So, you know, I always say like, I'm the little guy in that office and I'm super happy to be, it's fine. And then I invest in, then I have a second basket of investments where the people I trust are making investments and they feel, and I feel that I could add value to the management team. So I'll make a, you know, a multimillion dollar investment in Rackspace, Shutterfly. I've done that in a number of businesses, whether it's Cirque du Soleil or Lanvin, Wolford. And I'll sit on the board and I'll help management. Usually they're businesses that I'm interested in. So I'm happy to make the investment. I want to sit on the board. I want to help management. I want to get deeply involved in their success. And if there

are failures along the way, then I'll help them through those. If I help cause them, then I'll help them find ways to get out of them. But so generally speaking, and now I'm making a number of smaller investments in things that just interest me that I don't know how they're going to turn out. I'm invested in a company that's seeking to prolong the life of dogs. And I think that's really cool. And I think that the woman who runs it is really, really great. And so I made a small investment there. I'll make investments in things that I don't know much about, but I find interesting, either socially interesting. I'm no longer going to invest in oil. And I had lots of big investments in oil. So I won't invest in oil. I won't invest in gun manufacturers. I won't

invest obviously in coal. I don't know that many people that I know are investing in coal today, but, um, try to be a bit socially conscious and try to find things that interest me. You know, my investment in, in long van and Wolford, uh, are because I love fashion. Um, but I do think that we'll get a good return on the investment. And I brought Paris Hilton and Steve Aoki along with me and they love fashion. So, you know, hopefully we'll make something out of it. So good people around me that, you know, I really trust. Then there are the good people that I'm associated with like Apollo TPG and Fosun, where they're doing great due diligence for the most part. And, you know, they have so many investments that there are some that are appealing to me

and where I can add value and sit on the board. And that's really exciting for me. And so those are the kinds of things that I'm, I'm obviously the hockey team. I mean, Vonderman asking me if I wanted to be part of the ownership group. Yes. I mean, that's a Canadian kid's dream, right? I love that part. Let's talk about Bitcoins. That's how you and I got connected. We've done a couple of calls, and I think I've been really impressed with just your intellectual curiosity, your open-mindedness, and really the reason why we wanted to record this was you have a lot of questions that many people that you spend all day with, whether they're executives or investors, have, but also you've got a very unique view in that you've built a lot of great businesses or

been an investor in great businesses, and so you have a level of resources that maybe the everyday person doesn't have, which means that you have certain questions or concerns, or a perspective or thought process that again, you know, kind of the average person doesn't. And so let's just start maybe kind of with like, how you currently see Bitcoin and maybe some of the considerations as you're thinking through it, and then we can get into the questions that you have. Okay, so let me start with the way we met, because it will dovetail into my questions about Bitcoin. I have two sons, 25 and 20. My 20-year-old son, he sees that I'm involved with the Kraken and he sees that I'm involved with Lanvin. And he's been following the influencer trend on TikTok and Instagram. And he's been following you. And he felt, and he didn't tell me this first, but he felt that we needed to meet and that he felt that he wanted to see whether we could do something with you for Lanvin or for the Kraken with influencers. And the reason I bring that up is because Bitcoin's a bit like that, right? There's a generational gap. I'm 56. There's a generational gap between what's going on on TikTok. If TikTok's really making 17 times more EBITDA than Instagram, how many people know that? There's a generation gap also in Bitcoin. Doesn't mean there's not a lot of older guys in Bitcoin and women, there are, but there's a bit of a generation gap in blockchain and Bitcoin.

And so I find that I've sort of passed through a couple of phases, the phase of, you know, Bitcoin, it's bullshit. Bitcoin, it's a bubble. Bitcoin, nobody understands it. Right. And then I passed to the point where I said, wait a minute, really smart people I know are really engaged in Bitcoin. OK, leave aside your posts every day reminding all of us who don't own Bitcoin that it's up another thousand every 15 minutes. Leave that aside for a minute. But really smart friends of mine are in Bitcoin because they feel they understand it. All right. And now there are guys like me who are saying, OK, Tom, I have access to you. Thank you for that access. I want to use it for you to explain Bitcoin to me. I have a bank account, and I have a brokerage account. And in that brokerage account, I own shares in a number of public equities. And in that brokerage account, I have two or three different currencies. And I want to put a million or $2 million of Bitcoin into that account.

Well, you can't. So I start by asking you the question around, if I wanted to buy, and I did ask you this question, I want to buy a million or $2 million of Bitcoin, How do I get comfortable where I'm sending that money? Because it's not going to be Wells Fargo. It's not Credit Suisse. It's not BMO. How do I get comfortable where I'm sending that money? How do I get comfortable that what I'm getting in return is $2 million worth of Bitcoin that I can create liquidity with when I need to, okay?

And that I can rely on it being in a safe, secure place that I'll always be able to turn to it, whatever the value is. Maybe the price goes down. Maybe it goes up. So the first question, and I think it's one of the first questions, is how do you get me comfortable around that idea that I can't just buy it like I buy Google stock? Yeah, so we're cheating a little bit because this question we've talked at length about, but I think the first thing is people get really comfortable when they hear, especially when they've got large resources, Fidelity's in the game, or JP Morgan's in the game, Goldman Sachs is getting in the game. right? Like, okay, those are brands that they're from the legacy world, whether I'm a customer or not. I know them. I have friends that work there. I know people who use them. And I have some level of trust simply because it's a brand that I understand. And if they're doing it, there must

be some level of regulatory compliance, security, transparency, reporting, et cetera. And I think that just that alone gets people to say, oh, okay, like maybe there is a path. Maybe I'll use Fidelity, for example, or maybe I won't, but at least I know that there is a path that matches the way that I normally do things. But to your point, I can't go do it in my Citibank account or one of the other accounts you mentioned. The second component of this is there's a lot of crypto native or Bitcoin native solutions. These are usually the exchanges or custody providers. They tend to be names that the average wealthy person or investor has not heard before, before they start looking. So this is, you know, Coinbase, Gemini, BlockFi, and a whole bunch of

others. But what you do quickly realize is, wait a second, Coinbase has 35 million registered users, right? They've got 25 plus billion dollars of assets on their platform. Like these are numbers that show one, sustainability. So they've been around for, you know, many years. Two, they're backed by kind of tier one venture capitalists, many people you've co-invested with or that you know. And then three is just the kind of Lindy effect of like the longer it's around and the more assets that get put there and the more people who use it, the more people just have comfort. And whether they should or not, that's just a natural human psychological kind of component, right? You just get comfortable with something that is popular. And so I think that once people

start to understand, okay, I have options, right? I have legacy options and I have these kind of new Bitcoin native or crypto native options. Then it's really just like, what do I want to accomplish, right? And so for somebody like you, you'll be the first one to say, like, you're not a day trader. You're not going to go sit and try to time Bitcoin's market and buy and sell multiple times a day. So what you basically want to do is you want to think of it from an asset allocation standpoint. I'm going to put, you know, let's call it $2 million into Bitcoin. And I'm basically going to park it there. And sure, I'll watch the price because it's fun and exciting. But like, I'm not going to make any investment decisions based on if Bitcoin's at $32,000, $33,000 or

$34,000. I'm pretty much putting an allocation and I'm going to watch what happens. And so when that occurs, I think really where people kind of focus is like the on-ramp to Bitcoin is somewhat commoditized, meaning that you can go and use legacy options or you can use the Bitcoin native options. But really where the differentiation comes is around custody. So do you want to self-custody the asset or do you want somebody else to custody it for you? And I think that's the part of the conversation where one, there's a lack of education, but also two, there's frankly, fear, right? You know, how many times have you read something that like Bitcoin got hacked, right? Well, Bitcoin didn't get hacked, an exchange got hacked, a custody provider got

hacked, whatever. And so I think that what is probably not as well understood in the Bitcoin community is for you, right? And it sounds crazy, but like a $2 million investment is material, but it's also not material, right? In the sense of if you're used to doing very large deals with your money or other people's money, it's enough for you to pay attention, but it's also not enough where you say, you know what, I'm going to really trust myself to go self-custody this. I'm going to put it on some sort of hardware wallet and I'm going to put it in the safe in my house or something like that. And so your use case is very, very different than, you know, somebody who's kind of in the hardcore Bitcoin community. Now people will debate, should you self-custody, should you

not? We'll put that debate aside. It just comes down to where do you have confidence because this allocation is important, but it's not the most important thing. It's not the most concentrated part of your portfolio. And so where I think people end up on this is Fidelity, Coinbase, Gemini, BlockFi, JP Morgan, Goldman Sachs, they'll all come up with their thing. Or the next bucket is they'll start using something like Grayscale or Bitwise for these kind of ETF-like structures. So they're trust structures, but there's a public ticker. and so when you get in that world all of a sudden you say okay 12 months from now if we have this conversation you're going to be able to buy it in your citibank account right how it gets there

what's the process talk about fidelity for a minute so if my mom has a fidelity account and she has a million dollars in can she can she buy a hundred thousand dollars of bitcoin in that account yeah so uh the folks at fidelity are going to be all over me because i always get this wrong they move so quickly that it's constantly changing my understanding of where they are right now is basically if you're a high net worth individual or an institution uh you've got kind of a private client type relationship uh they will help you buy bitcoin they will help you store bitcoin and i believe that they've announced publicly uh they now will also give loans against your bitcoin collateral via a partnership with block five so but if you believe that in the next three

years you'll be able to click a button and buy bitcoin in your fidelity account even the next five years. That should be the path to, you know, the gen pop buying Bitcoin, not the sophisticated population. Well, so, and this is what's pretty crazy, right? Is as I've kind of unpacked this more and more, I've been fascinated to understand some of the nuances around what, like, you know, the general population. So when you really think about in the United States, I know the numbers pretty well, about 45% of Americans hold no investable assets, right? I mean, just literally no stocks, no bonds, no, you know, and anything. Those people actually are very quickly getting caught up into the investing world. You have COVID shut down all sports. So now they got

day trading stuff going on, the Robin Hoods, the cash apps of the world, fractional shares, crypto becomes a really big thing. It's fun. It's exciting. It's got the promise of you can become rich, like all it pulls people into it. And so I think that that like bottom, you know, 45% or so of the population. Generally is less educated, has less resources, but now is starting to show a desire. And so some of that will change. They'll get more educated and hopefully will be able to buy investing, kind of improve their financial life. Then there is, let's call it kind of another 45 to 50%. That's the middle to the upper end of the spectrum. These are folks who are into investing. They're somewhat sophisticated. They've got some level of

resources. And also they've got the persistence to go sign up for Coinbase or Gemini or BlockFi or whatever. So they're willing to put their information in for KYC AML. They're going to open a second account. They're going to go check it. They're going to make sure it's secure. Like they want the exposure. They understand the value proposition and their desire is large enough that they'll actually go do it. The third group is let's call it the top one to 5% of Americans. Up until maybe two years ago, most of those people were sitting this out. It was too small.

It didn't make sense. A lot of the things that you said, right? I don't understand it. It's a bubble. All of those things were, that was the talking narrative. That's all shipped in the last 18 months. And so I think those are the folks

that they're used to one of two things, either buying directly in that Fidelity account, right? And kind of being able to click a button or two, being able to make very large multi-million dollar investments in assets where they're an accredited investor, they signed some documents and basically now they own something.

And so the idea of, I'm gonna go open an account on this thing called Coinbase and I'm basically gonna wire money into it and then make a purchase, but I can't see my stocks next to it and I can't in my stock account see my Bitcoin, that's like a foreign concept to them.

And so I think that really what you're seeing is almost the reverse. The very low retail kind of 45% bottom of the socioeconomic ladder, they came in, then you got the next 45. And then finally, it's you're seeing the one to 5%.

These are the Paul Tudor Joneses, the Stanley Druckenmillers, like they're coming. When they show up, they're not showing up trying to buy, you know, $500 worth of Bitcoin. Trying to buy $500 million. Exactly.

So I think that's where you're seeing the price kind of explode. So I agree. And I think, I won't call it the barrier to entry. It's more the barrier to enter. And once the barriers to enter are going to become more simple,

more simplified, I think that, you know, that's when this thing will really really take off so let's talk about the supply for a minute okay um i'll buy a stock tomorrow in a company and they may the next day issue 10 billion dollars of stock to buy another company right so i bought them they had 50 million shares outstanding next thing i know they have 100 million shares outstanding that might be fine right i mean i may not agree with the purchase but i don't have enough stock to vote so it doesn't really matter So people are caught up in this whole supply and demand of Bitcoin, but yet we all own

US dollars where the supply is infinite and definitely not tapped. We all own stock in public companies where the supply can go down by buying back stock or up by issuing new stock. So let's talk about why people like me need to understand better this supply demand piece of Bitcoin where there's some fixed supply of Bitcoin. Yeah. So on the supply side, just structurally, it's a deflationary asset, meaning that there's 21 million over time. Once we hit that 21 million cap, no more Bitcoin will be created, right? That is determined by computer code. That computer code can only be changed if more than 51% of people agree. And obviously,

as more and more people adopt this, that went from at one point it was a couple hundred people had to agree to now it's literally tens of millions and one day will be hundreds of millions or billions of people that need to agree and so it's just generally accepted and i personally believe that will never happen it's too much kind of large-scale global coordination needed to change uh that 21 million uh cap so where does the voting take place so in in companies that i own shares in they send proxies around and we still in the sort of antiquated way put x's and boxes and send it back. So how does it work in Bitcoin? Yeah. So without getting really deep in the technical weeds, that's not how it happens. It is a fairly technical process. And so just if you hold Bitcoin

doesn't mean you get a vote, right? So there's a whole mining process and proposals and kind of an on-chain, much more technology-enabled voting mechanism compared to, hey, I mailed you. I need to know where you live, right? And I mailed you a piece of paper. You check off something, email it back. And so the other key piece to the structure is that 21 million cap, but also the incoming daily supply. And what I mean by incoming daily supply is, as you described with the shares in a company, it's set for a period of time until there's a decision made to increase or to buy back shares, right? And those are fairly infrequent decisions, and they create inflection points in price based on whether people agree or disagree. It becomes more attractive or less attractive.

Well, with Bitcoin, everything is programmatic. And that simply just means that they literally wrote in code at the creation of Bitcoin, we're going to have 21 million Bitcoin. And then we are going to take those 21 million Bitcoin and we are going to put them into circulation on a predetermined schedule. And so it started out at, we're going to put 50 Bitcoin into circulation every 10 minutes. And we're going to do that for four years. After that four year period, we will cut that 50 in half. It's called the Bitcoin halving. We'll go down to 25, do that for four years, then we'll go down to 12 and a half, and then we'll do that for four years, and then we'll go down to where we are today, where it's 6.25 Bitcoin every 10 minutes.

So the key to this kind of incoming daily supply is over the last four years, up until May 2020, there was 1,800 Bitcoin a day coming into this circulating supply. Well, in May 2020, got cut down to 900 Bitcoin per day. And so just like there's a supply shock in a company when there's either buybacks or there is a large issuance, Bitcoin has this kind of pre-programmed supply shock. Now, the last thing I'll say about kind of the structural supply side is when you are trying to determine market prices, you usually have two inputs, right? You've got the supply and you've got demand. And those two things change. And you essentially are guessing or estimating in an educated way, what's going to happen to the supply and what's going to happen to demand.

If supply stays constant and demand goes up, then we think price will go up or vice versa. And we kind of figure it out. With Bitcoin, Bitcoin is unique in that because it is a programmatic set supply schedule, we have 100% certainty what is going to happen as long as the code is not changed and we can verify it. So I can literally show you on the blockchain every day, 900 Bitcoin were created, here's where they went. And so that kind of certainty and predictability of a programmatic monetary policy is really unique because it then says, if we want to determine future price movements, we simply have to model demand rather than model supply and demand. And so I think that's one thing that Bitcoin has as an advantage over other assets

is the supply side is held kind of programmatically and predictably, and therefore the focus then shifts just to the demand side, not the supply and demand side like in traditional assets. Okay, great. So I want to just jump back to a preconceived notion that I had, which I no longer think is relevant, but it drove my decision to not learn more about Bitcoin for a while. And that was the notion people, I hate to sound like Trump, everyone's saying, people were saying that people wanted Bitcoin as a means to pay for things anonymously. And I was thinking, you know what? That doesn't seem like enough of a market. People aren't that uncomfortable paying with PayPal or paying with their credit card or paying with cash, that the world needs an

anonymous currency and that that's what's going to drive the value. Now, it turns out that that's not really the narrative anymore, that people need an anonymous currency and that the future of paying for things is Bitcoin. It might be, but that's no longer the narrative. So what is the narrative in terms of, you know, if I buy stock in Google, I think their earnings will increase quarter over quarter for the next several years. If I buy gold, it's because I don't understand gold that well, but there is a supply of gold that's more physically verifiable to most people, not to you, but to most people that don't have to code for Bitcoin, they can see the gold supply and understand the price of

gold. So what is it that's going to drive, especially since we now know that it's going to become easier and easier to buy Bitcoin? So what's going to drive the value of Bitcoin once we get to the point where everyone can buy a Bitcoin the way they can buy a share of Google? Yeah. So the beauty of narratives is there's always multiple narratives of any asset. And some of them are true. Some of them are not. And you as an investor basically have to figure out which ones are which, right? And so Google is a great example. You may buy it because you think earnings are going to go up. Somebody else may buy it because they think even with earnings flat, it's undervalued today.

And somebody else may buy it because they think that Google is the most innovative company in the world. They don't care about the finances and they just want to own the tech or back the founder or whatever, right? And so with Bitcoin, I agree that early on there was this, you know, very big focus on, you know, what people called anonymous, but essentially a pseudonymous payments, right? It's, oh, you can use this anywhere. Obviously, that's super attractive to criminals, drug dealers, money launderers, you know, that whole crowd. And so Venezuela, you know, all of them. And so one of the things that's really interesting is in the beginning, people hadn't had a lot of time to study Bitcoin, to study technology adoption, to study the way that currencies get kind of, you know, permeate throughout a society.

Now, after 10 years, there's a lot of really, really smart people paying attention to this, writing about it and kind of analyzing it. And so given the information we have today, there's a couple of key data points. One, almost every great technology is first adopted by the fringes of society. So beepers, cell phones, internet, right? It's this constant cat and mouse game between law enforcement and bad actors, and they're constantly looking for new technology to skirt law enforcement. So it's actually a positive sign if you look at it from a technology adoption standpoint, that those are the people who first adopted Bitcoin, right?

Because it's kind of the natural progression. Doesn't feel great from a society standpoint when that's the narrative on day one, but it's actually a natural thing to happen. The second thing is that people say, oh, it is electronic cash, right? It is a P2P electronic cash, right? Written in the white paper. Well, that is true. But one of the key pieces to understand about a currency, right? If you go back and you look at, let's say gold is you first have to have store of value properties before you can have medium of exchange properties. So real quick example of gold is gold served as this great store of value for 5,000 years, but it's hard to use. It's hard to carry around. It's heavy. It's

hard to break into, you know, divisible pieces. It's hard to kind of measure, you know, one ounce versus another without a scale, all those issues. You can't send it right across borders, you know, in the mail very easily, all that kind of stuff. Well, in order to solve that problem, we basically took gold and we said, rather than carry around the gold, why don't we put the gold in a safe and we'll create paper claims on the gold. So literally the US dollar backed by gold, and we'll just trade around this paper claims, much easier to use, much easier to divide, much easier to kind of count and really drive kind of velocity of money or commerce. Well, eventually we said, great, those dollars are awesome. Why don't we then create electronic

versions of them? So now we can just trade ones and zeros on computers rather than have to carry around the physical cash. And then we created credit and kind of all these other layers on top of it. And then in 1971, we decided to unpeg the dollar from gold, right? So that's kind of the story of gold, but really dollars were just a second or third layer to gold to make it much easier to use gold. Well, that's what's happening with Bitcoin. Bitcoin chose to optimize for one thing out of the gate, and that was the security to provide store of value. How does it store the value that you put into it? And so today, you could think of Bitcoin as a scientifically engineered saving technology. And what I mean by that is between the monetary policy of that cap

supply and the disinflationary monetary supply schedule, combined with the fact that Bitcoin is the strongest computing network in the world, meaning nobody can hack it, that provides the trust or the validation for people to simply exchange their fiat currency for Bitcoin. So they take dollars, they buy Bitcoin. They take euros, they buy Bitcoin. They take the RMB, they buy Bitcoin. And then they just hold it. And the reason why they're holding it is because they believe that the store of value, it will protect or preserve that purchasing power. And so compare that to the dollar, right? The dollar basically is falling off a cliff in terms of purchasing power year over year, 15, 20% kind of degradation of that purchasing power.

Comparing that to Bitcoin, Bitcoin is basically going up 50 to 100% a year in terms of purchasing power. And so now you're starting to get people waking up saying, wait a second, if we know that currencies get adopted by first being store of value, then being medium of exchanges. And Bitcoin is first optimizing for security and store of value, and then is now starting to add layers two and three into the future. And it's going to become easier to transact. It's going to become cheaper to transact. Actually, again, we're just kind of on the natural progression of adoption for a currency. So you overlay natural progression of adoption for technology with natural progression of adoption for a currency. And you start to realize this

Bitcoin thing is actually really, really interesting. And it's interesting because it is so different than all of the other currencies in the world. And I don't, you know, as an investor, you'll, this will kind of hit home for you, right? Is when everyone's doing the same thing, whether, you know, whatever the industry is, and a new player comes along and says, I'm going to do something different. If that person's right, they end up using being incredibly disruptive to the incumbents. And so if you look around the world at currencies, every fiat currency is exactly the same. They're all inflationary currencies. They're all governed by humans, usually with a central bank that's got a small number of people who are making decisions and they're manipulating interest

rates or quantitative ease. That's every currency. They compete on details, right? Who's got what interest rate, who's devaluing faster or slower, but they're all structurally the same. Bitcoin comes along and says, we have no centralization. We're completely decentralized. We're going to be programmatic. We're going to be transparent. And by the way, we're going to have a cap supply. Therefore, we're going to serve as a 180-degree different choice than your fiat currencies. And so 12 years, $600 billion in value, and I think we're on the way to something much, much higher into the trillions of dollars, right? If not tens of trillions of dollars.

And it's simply because this new challenger is 180-degree structural difference, and people are starting to understand the narrative around, if I can find something that is more accessible, it's digital, I don't have to have a bank account. I can simply have an internet connection and it is able to preserve my purchasing power. In the US and Canada, that's interesting, right? Like, yeah, the dollar works for me, but like if I could preserve purchasing power, that's cool. In Venezuela, Iran, India, Pakistan, African countries, that's life or death. That's literally the difference between having money for food or not. And so I think that we forget, you know, the US is 330 million people. We matter,

but we don't really matter that much when you look at the seven plus billion people in the world that are beginning to look at this and understand it and see where the adoption is coming from, you're likely to see it with people who understand hyperinflation, who understand the erosion of purchasing power. And so that's what to me makes it so interesting as a global phenomenon.

Well, but you, but the Americans do lead. I think one of the things, two things that throw people like me off is there haven't really been any new currencies in a long time, right? So all the countries have their currency, then a bunch of countries got together and created the euro.

So if anything, there's a shrinking number of currencies instead of an expanding number of currencies. So Bitcoin comes along, and you and I have been talking now for 52 minutes, and we only mentioned Bitcoin, which for me is fine, because I'm right now super narrowly focused on understanding Bitcoin. If you throw Ethereum into it and then a number of others, do you think that the existence of multiple currencies in crypto is confusing to most people? Do you think it's good for the crypto economy or is there really only room for one reliable leading currency? And these are questions I have no idea what the answer is. Yeah. So the framework I use to kind of think through this, and this is just constantly iterating on it, talking to people from public pensions, endowments, hospital systems, folks like yourself, all the way down to the average Joe literally on the street of New York, is I personally believe that every stock, bond, currency, and commodity will be digitized in the future. right? And what does that mean? It sounds cool, but what does that mean? If you go back kind of, let's say, pre-60s, 70s, and into the 80s, everything was analog. Literally, there was a physical stock certificate, a physical mortgage, a physical deed to a home, whatever. And those

were all transacted in the analog world. Literally, I would either hand you or mail to you a physical stock certificate, and that showed that you owned the shares in that company. Well, the people who quickly realized when the internet came out that I could use a computer to now purchase those same shares and I could own an electronic QSIP versus owning the physical paper, they had a significant advantage. They were early adopters, right? And now all of a sudden I could buy and sell with information asymmetry, with trade execution advantages, whatever. Well, every asset now is that electronic QSIP. It's kind of the electronic age of these securities. So literally you can own a mortgage as an electronic QSIP. You can own a stock, a currency, all that

kind of stuff. Like when you say you have multiple currencies in your portfolio, you don't literally have the physical currency sitting in, you know, a safe somewhere. You own them through these electronic Q-SIPs. Now what's happening is we're moving from that electronic version to this digital version, right? And so in that world, you're going to have digital stocks, digital bonds, digital currencies, digital commodities. In the world of crypto, there are a very, very small number of assets that are trying to be digital currencies, right? Bitcoin is one of them. There's these things called stable coins, which are basically backed one-to-one to fiat currencies. Central banks are talking about creating central bank digital currencies.

But a currency, very specifically as a store of value, medium of exchange, has kind of a definition to it. And there's very few in there, Bitcoin by far being the leader. There is a whole host of other things trying to be digital stocks, bonds, and commodities. So something like Ether, which is part of the Ethereum system, right, is not so much trying to be a currency, right? People aren't trying to use it simply as a currency. it's more something akin to a digital commodity, right?

It's used to power the system. It's used to gain access to things. And so there are some applications that want to use Ether as money. I've got my personal opinion as to why I don't think that's going to happen. But if you talk to the folks in the Ethereum community, they say, look, this is something different. Bitcoin and Ethereum don't compete with each other. They're complementary, right?

They empower different things. Their purposes are different. And so that nuance, just understanding Bitcoin and Ether are built for two different things. Once you understand it, you're like, oh, okay, that makes sense to me. The problem is that majority of people outside of crypto have no clue that that's true, right? They just think of, oh, they're all digital assets and like they're all competing for each other. And why is number one, number one versus number 8,000, number 8,000? There's just a miscommunication.

So what I think the world we're moving to and the part that becomes really interesting is your portfolio, eventually you're going to hold not just your stocks next to other stocks, you're going to hold every stock bond currency and commodity in one single digital wallet. And the switching cost between those assets is going to go way down. So today, if you want to go from owning a stock to then owning, let's say, you want to pick a really obscure fiat currency, you probably have to sell your stock into either Canadian or US. dollars, then you got to go do the currency exchange, right? And it's a pain in the ass, frankly. Even more so is if you want to take the currency that you got paid at, you know, salary for a job, and then go buy a stock, you got to get paid into your bank account, you then get a wired into your brokerage account, you got to go buy the stock, all that kind of stuff. Well, when everything just sits in the same place and has some level of kind of compatibility

on a technology layer, your ability to go from getting paid in, you know, US dollars into the R&B, then into Bitcoin, then into a stock, then into a bond, that friction goes down. We enter this really interesting world where people start to say, wait a second, why do I hold so much cash? Or why do I hold so many equities, right? The friction, the switching cost goes down. And so what I ultimately believe is going to happen is Bitcoin will continue to rise. It'll continue to be this great store of value on a global basis. It'll serve as not only a global reserve currency, but it'll serve as a personal or corporate reserve currency. What I mean by that is the government in the US may never accept Bitcoin

for taxes, let's say. They may just say, we only accept US dollars. Great. You're going to get paid in US dollars. With a click of a button, you'll be able to either automatically or manually switch that dollar into Bitcoin. You'll sit there and hold it. It'll preserve your purchasing power until you're ready to spend it. And then when you want to spend it, you'll click back into the US dollar and you'll go pay your taxes or buy something at the store or whatever. That'll persist for some period of time. But eventually, if Bitcoin just becomes stable, because so many people have it, there's so much liquidity, all of a sudden, you start to say, wait a second, why can't I just use this asset? Right? And I think that's the world that Bitcoiners see,

you know, I don't know if it's 15 years out or 100 years out. But that's the world that I think a lot of Bitcoiners are saying, wait a second, this is how this currency is going to evolve over time. Yeah, I think the volatility actually hurts its ability to be a transactional currency, Because if it's going up tripled in the last eight weeks, very few currencies do that. Some currencies fall by that percentage, but very few grow by it. So my last question is, I told you a story earlier where a regulatory event led me to a decision to turn off and erode $8 billion of market cap value of a very widely held FTSE 100 stock on the London Stock Exchange.

So there is talk about regulatory risk in crypto. How do you address people saying, well, it's going to be regulated. Well, the governments will control it. The central banks will control it. The people like Rubini and Warren Buffett, people we trust or like or respect, whose books we read, I don't know if they're naysayers. Some of them are naysayers. Some of them are cynics. So maybe it's a two-part question. One is credible cynics, and the other is regulatory risk. Yeah. So I think that one, having the regulatory conversation is important, right? People who just completely ignored or deflected aren't being realistic. Like there is regulation in the world, right? And the beauty of regulation

for the regulators is that they have armed men that will come put you in jail if you don't listen, right? So like that is a very real kind of conversation to have. Now, the first part is like, where are we with regulation? So in the United States specifically, the SEC and CFTC have both come out and they've said, look, Bitcoin is not a security, right? So this is a property or a currency. It's something else other than kind of a regulated security like you'd see on a stock exchange. That's important because it allows for more people to hold it and do other things with it that you can't do with a stock. The second thing is that every company that transacts with or is related or interacts with Bitcoin has to be a regulated entity based on

existing rules. So they haven't created new rules in most cases. There might be a state here or there that's creating new rules. But for the most part, if you want to transmit money, right, be a money transmitter, you have to get a money transmission license in the state you want to interact with. So you're kind of held to or regulated by the same exact rules you would be, whether it was US dollars or it is Bitcoin. Now that could change. That's one of the big concerns is all of a sudden there's more regulation on Bitcoin or crypto companies. We'll see if that happens or not. There's a lot of people working on the nonprofit and lobbying side to kind of prevent that from happening. A lot of education with elected leaders, but that's

one part of the conversation. The second part, and I think the thing that scares people more is not so much, hey, are these companies going to be regulated or is there going to be KYC AML, right? Is there basically going to be like feature parity to my legacy institution? It's, is the government going to step in and ban ownership, right? Are they going to try to do something that would be catastrophic from an ownership perspective? Am I as a holder of Bitcoin going to be at risk in some way? And the key part about Bitcoin that I think is so interesting is just like the regulators pulled Jack Dorsey, Mark Zuckerberg, Jeff Bezos, whoever into these regulatory hearings. And they said, you're the CEO, you're going to be in trouble if you don't do X or Y or Z, or we're

going to shut down your servers, or we're going to come and come to your offices. None of that exists with Bitcoin. There's no CEO to call in front of regulators. There's no headquarters to go to. There's no one to put in jail or fine or go shut down. And so that decentralization actually becomes an incredibly advantageous position to be in given what Bitcoin is becoming. But what the US could do is say, we are going to ban ownership of anyone in the United States. With gold, they confiscated gold. They made it illegal to own back in the 30s. And so they could attempt to do that. The difference though is I think that we would see an absolute global scavenger hunt of all of these governments saying the United States is going to not adopt this. Let's get off

the US dollar system. Let's all go and adopt it, right? If Russia, China, whatever other major superpower, we want to get off the US dollar system. We think that it is expensive. We think that it is risky because they can sanction us and tariffs and all this kind of stuff. Let's get off. And so I think that there's enough people in the government who are saying, an outright ban is probably an overreach. That's probably not good for the sustainability and the position of power and influence the United States wants to have. But we should add more regulation. We should have KYC AML. We should have companies that have to become broker-dealers or bank-licensed or whatever it is.

I think that's good. I think that's good. By the way, it's good for the currency because that means my mom can buy Bitcoin more easily. It's true. My mom was buying Cisco, which is how I knew that in 2000 the bubble was there because she didn't know what to say. She thought Cisco made oil, cooking oil, and I told her that it was Crystal. It's a true story. But the reality is that you want that.

If it's AML KYC and your broker or your online broker is, is, uh, is able to, to transact with you, I think it's actually, that's actually a good thing. Yeah. So I asked you about cynical, so cynical critics. Yeah. Look, I think that those folks are, um, either one uneducated, uh, or two, they're actually very educated and, uh, they're playing the role of entertainer, right. And there's a whole spectrum, a spectrum of them. Uh, I tend to say to myself, that's how a market is made. Like you need the people who don't believe because that's where the market is.

And frankly, when you talk to most people or almost everybody, I don't think I've met a single person who did the work to educate themselves and be able to talk intelligently about Bitcoin who didn't say, yeah, there's a good chance this works, right? Maybe they're not a full-on Bitcoiner.

Maybe they've got some concerns or questions, but nobody walks away and says, this is really stupid. I can't believe anyone believes in it and it's going to zero, right? And so I think education and time spent is really important. It's kind of the investment you make to get to that place. The second thing is, I don't know a Bitcoiner who isn't praying the price goes down.

And this is really interesting. Every stock, you know, kind of investor, they want the price to go up. Bitcoiners have this deep-seated long-term belief that the US dollar value is going to continue to rise. They actually want the price to go down in the short term though, so they can get more of it. They always kind of feel like, I don't own enough. I don't own enough.

And so that is a really interesting psychological element because maybe it happens in some stocks, like a Tesla or something like that, but that doesn't really happen to the degree you see in Bitcoin. And so it's almost the exact opposite level of fervor than the cynics, right? Like the critics of Bitcoin are super passionate. They go on television and make a bunch of noise and they kind of get a bunch of clicks and attention for it. Well, the Bitcoiners are almost exactly the opposite, but just as passionate. They go on television and say a bunch of crazy stuff. People will pay attention, whatever.

And so you get this really interesting asset where you've got two sides, they've dug their heels in and the market's going to be the referee. The market's going to determine who's right and who's wrong. And I'm biased, but so far- I mentioned Shamath a couple of times because, you know, he's a clear bull, super smart guy that I know and respect a lot.

A lot of the poker community, very, very smart, very well educated on Bitcoin. It does take naysayers. But I want to mention one more thing, which is that you're not my financial advisor. You're becoming a friend and I respect you a lot. Your comment to me privately was, Mitch, you should put 2% of your net worth in Bitcoin. And that makes perfect sense, right? That means that 98% of your assets are not in Bitcoin. And I think it was you or Chamath who tweeted

that the most difficult Bitcoin to buy is your first. And once you own it, you don't own enough of it. It might have been both of you tweeting to each other. So I still don't own my first, but it sounds like it makes sense. Once you own it, you want to own more of it. And the most difficult barrier to jump over is the initial one to get the first Bitcoin.

So I'll leave you with this. You'll appreciate it. And then we'll go into some rapid fire questions to end up, but, uh, I used to tell people by 1% and somebody who I won't name, uh, who's pretty well known in the finance world said, that's not fun. Cause if it goes down 50%, I only lost 50 basis points. So then I started to say 2%, cause if it goes down 50%, then you've at least lost a whole 1% of your, uh, of your portfolio. And, uh, and then you can really feel like, you know, there was some pain there. Um, but, uh, no, I, I, I think that's the right way to think about it.

Right. It's like, just once you kind of breach the wall a little bit and you say, all right, I'm going to buy one or I'm going to buy, you know, with half percent, 1%, very quickly people get up to speed. So, um, all right, before I let you go, I've got three questions that I ask everyone. First one is what's the most important book that you've ever read? The most important book that I've read is Startup Nation. Um, I'm half Israeli, uh, speaking of where I live in Israel, I bought and sold Israeli companies and it's actually, it's not that the book taught me a lot.

It's that the book is a great source of pride that the rest of the world gets to read it and see what Israel is all about, especially since there are many misperceptions. It's not a perfect country, but it's a great country. And it's, I think, you know, the second greatest entrepreneurial country in the world. I think America is the greatest entrepreneurial country in the world. So that's really the most important book that I've read for that reason. Yeah, that's a fantastic answer. No one's ever said that one before. The second question is a question that is sponsored by Eight Sleep.

So Mateo, who's the CEO there, has absolutely berated me into becoming a better sleeper. I sleep on this mattress that they have that cools it off. And I told him I would now ask everybody, what is the sleep routine? Like, do you get four hours of sleep, eight hours of sleep? How important is it? And do you actually focus on sleep? Or is it something that just kind of you do with the bare necessity? so it's a super it's like a bit of a personal question for me because um i obviously i'm very

transparent in every uh i do a lot of interviews and i say ask me any question i'll answer it so i sleep extremely poorly uh i wake up a couple times in the night i rarely sleep five hours more than five hours i take sleeping pills two three four times a week just to take an edge off to hopefully fall asleep um i i could use help i've never sought help like some type of sleep therapy some app uh so your friend i'll speak to anyone because i'm a horrible sleeper i've been functional i have a lot of energy it hasn't hurt me um i hope it hasn't taken any years off my life but i'm not a good sleeper uh i will introduce you to mateo he he will you're like his uh his perfect person he literally for people who for sleep uh sleep research last year i took

120 flights and not only did i not sleep very well because of that but i was always sleeping in like on a plane or, you know, on a red eye or whatever. And, uh, when I met him and, uh, and he started getting me up the, uh, the curve, I've got to say it was like the most impactful thing. And you forget like what a good night's sleep is. So, um, it's just interesting to hear from people. Uh, last question. And then, uh, we will cut it is aliens. Are you a believer or a non-believer? Non-believer. Wow. Why? Yeah. Um, listen, could there be life out there? There could be can i explain you know other than through you know big bang theories and darwinism our existence no i'm not that smart um but and i don't need to i don't need to have real hard

evidence of something to believe in it but um you know i i've it's never occurred to me that there are aliens um you know whether some other life form but the galaxies are so huge that the possibility that there's other life forms in some galaxy are probably very high i don't know if that's what's called aliens um when you get into aliens that have maybe visited earth then i don't believe at all ufos don't believe at all um you know maybe i'm maybe i'm too much of a cartesian cartesian thing for for uh galaxies is one thing i agree with more star trek more star trek style and then ufo in our galaxy i need to thank my son ryan for introducing us because this this generational you know that would never happen in the old days you know i could never have

introduced my father, you know, when I was 20 to someone in business that he needed to know, um, the internet and Twitter and TikTok and Instagram, it's amazing. Um, and it's what brought us together and I owe him a great debt of gratitude. Yeah. He, uh, one is super smart, obviously. And, uh, the thing I think that I'm most impressed by, uh, and hopefully I'm not revealing too much here is, uh, when we've talked, uh, you've had them on the call and they're not intelligent. Uh, they're intellectually curious like you are. Um, and it's very fascinating to me to see kind of you bring certain skills and experience and interest. They bring different ones in some cases, and you guys were able to kind of meld those together. And so, you know,

kudos one to you to kind of having them involved, but also to, uh, to, uh, for, for them to be interested enough to, uh, to pay attention as well. Um, and also thanks for showing them, uh, interest and giving them the time. I appreciate it. Of course. How can people find you on the internet where should we send them yeah mitch garber on twitter i tweet a lot in french but that's okay i shouldn't turn you off um yeah i'm mitch garber on twitter i'm mitch garber on instagram uh mitch at mitch garber investments.com you can find me i'm on linkedin every time i see you tweeting about bitcoin it's usually you're tweeting at me telling me hey man stop stop rubbing it in that it's going down and then when i see you in chamath but i won't so

okay when i see you tweeting in french i'm like oh he's definitely talking bad about us no i love you guys thank you absolutely thanks so much for doing this mitch okay