The Pomp Podcast - Is $100k Bitcoin The New Normal? | Jeff Park

Episode Date: November 13, 2025

Jeff Park is the Partner and Chief Investment Officer at ProCap BTC. In this episode, we break down why bitcoin has been moving sideways and whether investors should actually be concerned. Jeff walks through major forces shaping the market — from 50-year mortgages and government backstops to the surge in AI data-center demand. We also touch on Square’s bitcoin payments rollout, the state of stablecoins, and where sentiment goes next. ======================Check out my NEW show for daily bite-sized breakdowns of the biggest stories in finance, technology, and politics: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠http://pompdesk.com/⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠======================Simple Mining makes Bitcoin mining simple and accessible for everyone. We offer a premium white glove hosting service, helping you maximize the profitability of Bitcoin mining. For more information on Simple Mining or to get started mining Bitcoin, visit https://www.simplemining.io/======================In this episode, Pomp spotlights easyBitcoin.app—the app that pays you 1% extra on recurring buys, 2% annual bitcoin rewards, and 4.5% APY on USD. Download it now for iOS or Android at https://easybitcoin.onelink.me/F1zP/klc4v1p8 and start earning today. Your capital is at risk. Crypto markets are highly volatile. This content is informational and not financial advice.======================Core is the leading Bitcoin scaling solution, enabling you to lock in yield by locking up your Bitcoin. Simply lock it on the Bitcoin blockchain to secure the Core network, and get rewards. No bridging. No lending. Just holding. Still your keys. Still your coins. Now your yield. Start at https://stake.coredao.org/pomp======================Timestamps: 00:00 – Intro01:55 – Is $100K the new base for bitcoin?04:41 – Is the 4-year cycle broken?06:19 – Should the U.S. adopt 50-year mortgages?10:20 – Global housing models (China, Asia, etc.)16:52 – The “poor door” debate & why luxury lowers rents20:54 – Stimulus checks & tariff dividends23:26 – Government backstopping AI data centers35:02 – Crypto market structure bill40:12 – Bitcoin vs. stablecoins for payments

This episode is brought to you by Accenture. When your advertising operations fall out of sync, everything else follows. Spotify and Accenture are working together to reinvent the rhythm of ad sales. Using automation, analytics, and smarter workflows to simplify campaign delivery and access better data across the business. The result? Less time spent on operations, more time connecting brands with the moments and fandoms that matter most. Learn more at Accenture.com slash Spotify. 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 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. You know,

it's not been great that the ETF inflows have turned a little bit negative. You know, it's not great that the treasury companies have not been able to buy as much as people had anticipated, even though Saylor has been doing heroic things, coming up with new preferred structures as has Strive to permit the opportunity to have more digital credit in the space. But in the end, like we probably still do need more of that flow to come in to offset what otherwise is coming to be some persistent supply. Do you have a view as to four-year cycle tops? What's going on, guys? Today, we've got a great episode with Jeff Park. Jeff is a partner and chief investment officer at ProCap BTC. And in this conversation, we talk about Bitcoin. Why

is it going sideways? Should you be worried? On top of that, we get into the 50-year mortgage, the tariff dividend checks, what's going on with the government being the last lender of resort to the AI data centers. And then we even get into some things around Square's recent launch of Bitcoin payments, what's going on with stable coins. And of course, we've got to finish it up and let you know, are we bullish or bearish? Here's my latest conversation with Jeff Bark. All right, Jeff, it seems like Bitcoin is trading in this like range.

It's going from 100K to like 115 and back, just back and forth, back and forth. Is 100K like this new base and there's consolidation and we should kind of think of this as a negative thing where we can't break out to the upside? Or actually, is this a really positive thing? Because there seems to be this like persistent bid of institutions and large capital pools

who are just saying like, we want to buy anything below 100K. We're buyers of Bitcoin there. The demand and the put, if you will, as you've described it, is definitely there. So that's something we should take some relief in. Nonetheless, it has been discouraging that we've had many peaks to troughs drawdown this year over a mainstream cycle than otherwise we should expect. I think there's like eight different counts of drawdowns at this point where we can't expand outside of like a 20% range. And Bitcoin, as we know, needs a little bit of volatility to make breakout moves. So the question is, why is there selling pressure at any given time? And, you know, one of the metrics that I think is really interesting, and Glassnode does

a really great job presenting it, is this metric called short-term holder realized profit to loss ratio. And that metric actually hit 0.2 earlier this week. What that means is that 80% of those who have been acquiring Bitcoin recently are underwater, and they're the ones that are selling. So this is not the same narrative of the giant whales that have been sleeping for 15 years and coming to market and selling thousands of Bitcoins at a time. We're continuing to see that kick in. But there is a little bit of capitulation, if you will, with short-term investors who came in as well.

That, I think, is healthy because those are generally the same people who come back to buy when there's momentum of a breakout. So that money can actually be more of an accelerant in the future. but nonetheless there is definitely some kind of supply that seems to be ever present between this 110 115k range and anytime you go near there there is some downward pressure and that's why i think everyone is so focused on the 100k because when you look at the range of where like the back bids would be beyond that it starts to thin out a little bit where we can imagine we're going to start testing 95 and and ranges that otherwise we would be disappointed to see at this point of the

cycle. But it's not been great that the ETF inflows have turned a little bit negative. It's not great that the treasury companies have not been able to buy as much as people had anticipated, even though Saylor has been doing heroic things, coming up with new preferred structures, as has Strive, to permit the opportunity to have more digital credit in the space. But in the end, we probably still do need more of that flow to come in to offset what otherwise is coming to be some persistent supply. Do you have a view as to four-year cycle, tops, extension of bull markets, volatility? What's maybe your current weekly check-in on what is transpiring? I think sometimes maybe what we're living through now is a pull forward of

what might have been the four-year cycle in 2026. Are we now digesting what otherwise could have been a challenging environment preemptively to have a great run come 2026. And the reason is because so much of I think what we're going to see for Bitcoin going forward will be in sync with institutional capital because it has now entered the mainstream era where the flows we're talking about, the next level of capital flows is really coming from that channel. And those investors are much more in sync with global macro credit cycles than they are with the block itself and experiencing the halvings. They don't really care about that. And so I do think genuinely the four-year cycle is broken, but it doesn't mean we're not going to have cycles. It's just the cycles probably

correlate more to what people think of as risk on and risk off assets. And Bitcoin has this unique property where it can be both. This week, the other thing that's given me a lot of confidence is we are hitting highs, hopefully with the equities market. It's so close to surpassing $6,900 again for S&P. And gold too. Hey, it's been on a bit of a climb. And I think it's going to hit $420 pretty soon there. Again, $4,200. And so if those things hit, both risk on it and risk off, where people are just wanting to find a way to save capital, that is kind of, I think, the bat signal, if you will, for Bitcoin to perform. Now, what's interesting is Bitcoin is supposed to be a solution to this degradation of purchasing power, the printing of money,

national debt exploding etc a big thing that people point to as to the pain from all of that is home affordability uh people can't afford homes and that's a big problem yeah rather than simply say bitcoin is a solution to everything which is a solution to a lot of things not everything but a lot of things we now have a proposal for a 50-year mortgage and i've seen a lot of different takes i've seen people who love it i've seen people who hate it i've seen people who said, if you don't want it, don't get it, right? How do you evaluate like maybe why a 50-year mortgage idea is being floated and is it a good idea or not? Yes. So before we come to judgment, let's discuss what are the facts. Spoken like a lawyer. Well, we got to get the numbers in,

right? I like to be at least empirical as we can talk about some of these things. The first is UBS put out a great study, which they have shown now that for an average mortgage size, most Americans would benefit by roughly cutting their payment monthly? About $100 by extending it from 30 years to 50 years. $100 a month. But in return of that, the interest would now double in total for the rest of the loan's duration. So the question is, is $100 a month actually meaningful enough to double the total interest expenditure expected of this loan? The second number I would point to is The average home buyer in this country is now 59 years old. That's the average home buyer. And the average first-time home buyer is about 40 years old.

That means that average home buyers that are being first-timers are decreasing, which is the third number I would like to bring to point, which is 20%. 20% of all home purchases today is first-time home buyers, meaning 80% are not first-time home buyers. There are second home buyers, third home buyers, fourth home buyers, whatever they're doing. But the reason they're buying multiple homes is no doubt because they are looking at it as an investment property in conjunction to the utility of it being a dwelling, right? And so that's the fundamental question at play here. What is the role of a home? Who deserves the right to have home ownership? And should there be some preferential treatment across generations for the utility of a home

that is beyond investment speculation, but also because it is related to the growth and productivity that the person is contributing to by being a homeowner. And so the idea of extending it from 30 year to 50 year is, in my opinion, probably one of the worst political move you can make to anger both the left and the right. And it's predominantly because you're going to find most of the young people very unhappy. You have to imagine the young people are already so disadvantaged. They graduate from college with so much student debt that they already feel like they're not earning enough opportunities to pay off that debt. No less the idea that then you're going to be a first-time homebuyer when you're 40 years old to pay off your home when you're

90 years old, when the average mortality in this country is 70. I mean, that's basically saying you're not going to pay your home until you die. And then you'll hear some boomers say, that's fine because actually the home will just get passed on to their children. No, they're not. these people are not having kids. If you're in debt for the rest of your life to your 90, what on earth would you think the benefit would be for you to have a child so you can then throw your own debt to the next generation, right? These are pretty evil things that are being discussed at some level. And so I think that the appropriate question is like, one, as Americans, do we want home price to always go up? And do we want home price, nonetheless,

to be anchored with some economic productivity that isn't just investment speculation? And should we change something about it beyond just kind of the financing element of it, but like a social element to bring home prices back to a level where we all believe is actually the right solution, both market-based, but also like social needs-based. Now, you had this great tweet explaining some of the other systems in the world, specifically in Asia, how I think one of the systems, you can't buy a home in an area you're not from. So that was very interesting. Another was basically like your family's roots determine home. Just explain some of these other models maybe that people have. And I don't know that you were necessarily condoning or advocating for one

of these, but I don't think, at least from my ignorant Western mind, that I fully understood maybe somebody's other system? Yeah, no, it's a great question. And I love talking about this because home model across the world is so varied and it usually starts with the concept of land itself. So here in the US, the idea of owning deeds to land is pretty much taken for granted. But if you go even to like the UK, right? Actually, most homes you even buy in London, the land itself is not what you buy. You buy the property on the land with a very long-term lease to which the government, or in many cases, the monarchy can actually take back the land, right? And so this bifurcation of land as an asset, and then the property on top of the asset in itself

is in many countries detached. In the US, they tend to be a little bit more unified, which makes American capitalism a little bit more distinct than others. And look, the reason I brought Asian countries as proxies is because Asians love speculating on real estate, right? I mean, that's why I brought them in. It's not because I endorse China. It's not because I endorse their policies or Singapore's, but because these are probably the most kind of investment into real estate loving groups of people you'll find on earth. And the reason is simple too. Like it's because for all the wealth creation, the Chinese have had, there's no way to put that money to work. Right. I mean, like their stock market's crap. It's not as good as ours. And so they just

need something that can store value and real estate is the first thing that can latch onto. and so they want to invest in it. So because it's so problematic in the East, they've taken on a little bit more of an authoritarian policy in some sense to be able to control for the flow of capital. In China's case, for example, they have a welfare system called Hukou. And this welfare system is really unknown to Americans. And they might even think it's a little bit strange. But I think in some sense, it makes sense for some aspects of it to be maybe even practiced here in the US, which is the idea that in China, if you're born in a certain city, the social benefits that come with being a citizen, such as healthcare or home ownership or whatever that you might need, is localized to where you're born. And that means if you move for labor reasons to a different city, those benefits don't necessarily translate with you. So you then do become like a second class citizen, almost like a migrant laborer from the countryside to the city side, even internationally, like within China. And there's a little bit of like a discriminatory system there. But the reason I think they do this is because they ultimately want to entice some sense of cultural awareness of their hometowns and incentivize people to also invest in their hometown and separate capital movement with labor movement as much as possible.

So you can imagine in scenarios in the US, part of what I think most economists are even aware, but they won't admittedly refuse, is that labor mobility isn't everything. Because we talk about, oh, capitalism works because free movement of labor means there's perfect price for opportunities for the individuals. Well, guess what? It's generally only the wealthy that move around a bunch. And they usually move around because they're trying to not pay taxes. You never hear about the lower class having any labor mobility. They're actually stuck in many cases. And so this is actually kind of a problem. Imagine on top of that, in a post-COVID world where so much work can be done remotely, that geographical arbitrage becomes even more extreme and pretty specific to the conditions of the times we're in. So I think that aspect of it is really changing a lot of the ways people should think about labor and capital movement across borders. And that's ultimately what homeownership is, right? Like you have to live, hopefully, where you work, unless we're going to break that social contract and you don't have to do that, then there are some policies which you have to support your local workers for. of seamless i mine with the pool of my choice and the bitcoin is sent directly to my wallet simple mining which is based in cedar falls iowa offers a premium white glove service designed for everyone from individual enthusiasts to large-scale miners they've been in business for four years and

currently operate more than 20 000 bitcoin miners including mine their electricity is over 65 renewable thanks to the abundance of wind energy not only do they simplify mining with their top notch hosting and on-site repair services but they also help you benefit financially by running your operations as a business. This approach offers 100% bonus appreciation to optimize the profitability of your investment. Do you ever worry about the completion of maintaining your mining equipment? They've got you covered there too. For the first 12 months, all repairs are included at no extra cost. If you experience any downtime, they'll credit you for it as well. And if your miners aren't profitable at the amount, simply pause them with no penalties.

When you're ready to upgrade or adjust your setup, their exclusive marketplace provides a seamless way to resell your equipment. Join me and many satisfied miners who have simplified their Bitcoin mining journey. You can even get started today with a seven-day miner trial. Visit simplemining.io slash pomp to get started today. That's simplemining.io slash pomp to get started today. With Simple Mining, they make it simple. Today's episode is brought to you by EasyBitcoin.app. They offer a simple, rewarding Bitcoin investment experience. With EasyBitcoin, every recurring buy automatically earns you 1% extra in Bitcoin. And the sats don't stop there.

Hold your stack in the app and you'll collect a 2% annual reward plus 4.5% APY on any U.S. dollars you park in the USD interest account. You can even opt in to have your interest auto-converted to Bitcoin. It's a simple set-it-and-forget-it way to grow your Bitcoin. Easy Bitcoin is live right now on iOS and Android. Hit pause, click the link in the description, download the app, and start earning while your Bitcoin stash grows. Your capital is at risk. Crypto markets are highly volatile. And this content is

informational and not financial advice. Now, as we are watching this kind of play out here in the United States, I think whether it's a 50-year mortgage, just building more housing, one of the data points I saw that was fascinating is building luxury apartments actually drives down the cost of affordable apartments. So it's a little counterintuitive, right? People think that you need to build more low-income housing or more affordable housing. you always hear people talking about that. But it's not just doing that. It is actually, if you just build more housing, including luxury apartments, you essentially provide relief. So now some portion of the population says, oh, there's more apartments. Let me go and take a luxury

apartment. And that frees up the affordable housing for other people and pushes down kind of the price. That was fascinating that you just have to build more housing. It really is that Yeah. And also, one thing the US, I think, is doing a better job now than it historically had done before is you do want to discriminate a little bit between foreign investors and domestic investors. And the US is not draconian about this the way Asian countries are, where there's specific limitations if you're foreigners, you can't buy. But clearly, they're building certain products in the New York real estate market that is meant to be owned by foreign investors at price points for which they're definitely at a premium to then provide some

subsidy effect. Otherwise that would come through the city for other kinds of housing. That being said, it's not perfect. And there are still some things that I think is like fairly nefarious in that public private partnership construct, which is like, have you, have you, have you heard the poor door here in New York? No. Man. So the poor door is a throwback in time, but there used to be some tax concessions for certain property developers that if you're building subsidized units within the same luxury condominiums, you can actually get better tax deals for basically the condo owners. And the way then you have to do that is you have to let the public housing folks or the lower income housing folks live in the same condo as those who are willing to pay the

market price, which you could imagine most people who pay market price in New York doesn't want to do that right so they created what is called the poor door and so every now and then you'll see these condos where there's this main entrance which is what most people use and then you see like other people use a side door like on a different corner of that building and it's actually an entrance to the exact same building so they're in the same building but maybe they're going to different floors and those floors basically you just never see if you're in the primary residence of a different complex they're also not allowed to like use the same amenities so then they can't use the gym they can't use the pool or whatever that is in the condos but

they're all living together i think it's so weird and bizarre that this is a thing that we decided is okay like imagine you're a family who happens to live in the subsidized units and you have to tell your children oh you can't go through the main entrance where other people are going through you have to go through this door because our units is subsidized and by the way we can't use the gym that like other kids are using in the same building i mean nothing makes me more angry than the concept of even developers thinking this was like a legitimate outcome to taking advantage of a tax subsidy. And yet you see some of these buildings that have what now is just called the poor door. And it's a little heartbreaking to me. You put the incentive there, people are

going to capitalize on it, right? Like it's kind of this weird dynamic of, you know, you can get mad at developer, but in a weird way, it's like, don't put the incentive there. And so it's, you know, the road to hell is paved with great intentions, kind of a perfect example. And to the benefit of those who are living there in the subsidy unit, it's a great experience, right? They're living in a luxury condominium paying below market rent and they won the lottery too. They're very happy to be there because it is off market, but it's just this idea of like, is this societally okay?

Like, are we okay with creating these like bifurcated two level markets, right? I think even the way we talk about the K-shaped economy all the time, like it's literally living in this poor door building. Now, if we go and we take a look at another thing that has been suggested as a potential solution is why don't we just give people money? like you know socialism is uh now the the uh all the rage in new york city um washington dc let's give out two thousand dollar stimulus checks we'll call them tariff dividends uh last time this happened stocks went up bitcoin went up i mean it was freaking bazooka this is amazing for asset

owners it was not so good for the bottom 50 who didn't own assets very high inflation lots of problems there um i don't know if they're actually going to do this but just the insinuation the announcement, the potential. I felt like everyone had come in from the wild. They had stored their horses away, taking off their cowboy hats. They were getting ready to sit down, take a nap. And all of a sudden, $2,000 stimulus check. You saw everyone start putting the cowboy hats on, get the horses, like, let's ride again, right? Oh my gosh. This reminds me, when I was in high school, I think it was like my sophomore year, I had thought about running for class office, right? And when you're in high school, you have to run a campaign too. And you got to promise

stuff. And usually the kids are promising different extracurriculars or a homecoming is going to be a little different this way or blah. But there was always this open question, like, can you like give them stuff? Like, can you give like, I don't know, iPods to your friends to vote for me? And of course the schools would say, no, you absolutely cannot provide like monetary value because that's called a bribe. And to see this unfold in the national stage of our elections now as if this is a totally normal thing is incredible, right? Because that $2,000 refund, if you will, is definitely an economic motivation for votes. And that is a backdoor channel to what otherwise people will call bribes. And I think all of this roots back

ultimately to one of the most significant Supreme Court cases that still has not yet been overturned, which is Citizens v. United, when the line between public interests and the role of capital in influencing political outcomes that may be divergent from public interests has been unleashed. I think to solve at the core, the chaotic outcomes of public and private money that is not aligning is we have to revisit citizens versus united. And that's probably where it starts. And then only then can we heal as a country morally to really think about the role of money in the ways that intersects with like public governance in the actual office. Now, another area where we see a government wanting to dangle its little fingers is

potentially backstopping all these AI lending deals. There's some controversy as to whether they actually got asked to backstop or not. They said, yes. Then OpenAI kind of pulled back a little bit, said, no, we didn't say that. And then I saw a document that kind of sort of insinuated it. I don't know what's true, what's not true, but just the concept of the government backstopping risk-taking, that seems a little wrenching towards a bad idea a little bit more. It's a really interesting question that deserves more opinement by society at large, which is, in theory, great things can happen with government supporting long-duration missions. Right. What's really good about public capital and the way governments can support investments is that they can take multi-decade long views and not worry about immediate quarterly earnings.

Right. It's kind of the reason why QE works, even though all the securities on the balance sheet is mark to market at a loss today. They're not selling it because they're going to wait for it to mature, pull to par. So because they can write governments can take multi-decade long views. So in some sense, if you are able to strike good public-private partnership, there can be valuable things. However, there can also be really bad outcomes if the incentives are aligned incorrectly. And this is where I think people are trying to sniff out, like, what is the motivation? What is the structuring? What's the timeline in which it will materialize?

And what are the moral hazards that otherwise it could create? The thing that is really concerning as an outsider of the industry, for me, as I observe it, is the industry clearly needs more compute. And now the narrative is that basically we have to commoditize energy and compute so that everyone can find it accessible as a public utility. So what they're saying is just like the way that the government supported telecom investment and DARPA and rocketry and all these things, compute is now that same utility. And so the input cost has to be as cheap as possible for all the great things to come out of it and innovation that can build on top. Now, the question is, what are the levels of transmission that is happening between that input of what is called utility to otherwise is service added that then becomes the consumer-facing product that has more leverage and pricing power? And so it's not totally obvious to me that we can make the same comparison that data and compute is like electricity, right? Because some of the older technologies that have been supported by the government to give a scale were not nearly, in my opinion, as asymmetric as the way AI could be, nor accelerating as much as AI could be.

For instance, when electricity happened, it was great. It was definitely productivity boosting. But why was it productivity boosting? First and foremost, it allowed people to work longer hours because now you can work at night. But that's a pretty linear thing. I used to work only six hours a day. Now I can work 12. It's pretty linear.

cars and things like that, same thing. It used to take me 20 hours to get somewhere. Now I can go there in two hours or whatever it may be. You're kind of linearly improving upon some of the human capacity for output. It's not very clear to me what the price of labor will be in the context of the price of capital when we talk about AI data centers. To me, it's a totally different tectonic shift. And we know that there is a tenuous relationship with the price of capital and the price of

labor that needs to self-sufficiently provide a flywheel for society to function. And if we start going down the route where, hey, we're going to subsidize everything by the government for which is the very thing that is going to displace the human labor force, I mean, that is not probably what the business of government is, right? The business of government cannot be to displace the labor force in the long run. And that, I think, is the million-dollar question. When we say we want a federal backstop, is this a backstop to what means and what is the outcome that we're trying to achieve? And without some conversation around labor retention in the ways

that we can have a more robust conversation that isn't going to be a lack of social security safety nets, I don't think that society at large is ready to backstop something where they know that the victim is themselves. Today's episode is brought to you by Core. You can earn yield on your Bitcoin by just holding your Bitcoin. It's simple. Core, the leading Bitcoin scaling solution, will reward you for not selling your Bitcoin. It's not magic.

Here's how it works. Core is a protocol secured by elected validators. You can help elect validators and secure the network by simply locking up your Bitcoin on the Bitcoin blockchain. No bridging, no lending, and just holding. When your validator secures Core, it earns rewards fueled by network activity and passes them back to you as yield.

With a minimum lockup of just one day, when the time lock ends you get your bitcoin back untouched steal your keys steal your coins now your yield for even higher rates stake core alongside your bitcoin and multiply your yield and if you want to see what your bitcoin is securing join millions of others and exploring the largest bitcoin defi ecosystem there are over a hundred live apps in the network and the deepest liquidity in all of bitcoin defi get off zero and start earning yield on even just one percent of your Bitcoin by going to stake.cordow.org. Again, that's stake.cordow.org. Or go click the link in the description. So two things that I immediately jumped to mind. One is a very clarifying question

whenever the government starts talking about this stuff. What is the metric of success? Right? And I don't think it'd be labor market participation, right? But even if you just think about like okay if you're going to financially do something how do you measure the success is it we don't want anyone to go bankrupt okay well that means you're going to save bad company people who did bad deals right which means inherently like those are the deals that should go bankrupt so you can't really do that or that's a misallocation of funds um are you going to optimize for the number of data centers or maybe the efficiency of data centers or the amount of compute or packets or you know i mean you start like going through all stuff and it's like it's unclear to me what

the actual right metric would be now i'm not some ai expert or you know energy expert uh that that is um you know claiming that i could figure out what the the government's data point should be but it does feel like there is a um u.s based capacity that as kind of an aggregate measurement however somebody wants to cut that the more capacity we have the better and whether that from lots of small sites a few big sites um is that cut up among 20 companies or three companies you know it almost just feels like capacity is actually the thing that we should wrap our head around i don't know if the government being the lender of last resort actually can impact capacity because they can provide funding but it's not clear that funding is the limiting

factor there right like getting everything built and all that kind of stuff if it's failing okay you get more money but does that mean you actually get more capacity online like it just feels like we're a little like too indirect to what the thing that we actually care about yeah and it's also like not really within the genes of like american government right like we're founded upon the principles of open markets where price discovery happens naturally without there being a huge government backstop like it makes a little more sense when you have industrial policies in countries like china where they take like much longer views and they're willing to subsidize a lot of things for a long period of time. But culturally, we're not built off of that

being the mode of operation. I'm open to the idea that we might have to change the direction to compete more aggressively, to having that mindset, which could be a rejuvenation of what the role of American government could be. But historically, U.S. government has not been a great capital allocator. I would almost argue they also have not been able to sponsor national champions very directly in ways that they should have. One of the reasons 5G has been lost upon the US is because we lost Bell Laboratories, right? I mean, we basically let it go. And so in the end, some of the things that just has to happen is more going to be market principles driven. And capacity is one of the things where you can build a lot for, but if there are people that

are not going to use it, then it is going to have to be paid back in a different way. and there is a great question as to like you know as far as like machine learning goes how much of this thing do you actually need to do it like onshore versus offshore where the output is the thing that ultimately becomes the input to the higher value-added things to build on top of too right and we don't know what that kind of look through looks like just yet either we're gonna do it in space i think bezos said that right i think he did yeah like uh i've also seen Delian at Varda and Founders Fund fame. He says, stop talking to me about this. This is a dumb idea. I kind of like that. Like you got two space entrepreneurs, Jeff Bezos versus Delian, who's

going to be right. I don't know. I mean, it kind of makes sense. I mean, you just don't know. You don't know. And it's not to say like not knowing means there can't be a path for action, but it's clear that this particular conversation is hitting a lot of nerve at the societal level because there's so much at risk. And really, to me, it's no different than the constant transformation of risk that happens under the guise of the central bank, right? So historically, we used to think of monetary policy as this independent thing from fiscal policy.

We now know they're very much married, right? It started with probably Janet Yellen when she decided to weaponize the treasury with active treasury issuance, where she showed monetary policy can absolutely be political. So that's out of the cat. The next evolution of this conversation is does monetary policy become industrial policy or does industrial policy affect monetary policy?

And if you provide cheap- Depends who the Fed is. But it also depends on what you were mentioning, which is what are the national strategic goals of a country and the way to subsidize that outcome? And if we decide power is something that has to be commoditized, energy, then ultimately this is a different kind

of risk transformation that the central bank and other entities are permitting, right? If you think about QE at large, they're basically doing risk transformation across two segments. One is liquidity transformation, right between the short end and the back end. And then if they're being more aggressive, it's a credit transformation where they're basically subsidizing or enriching different credit spread premiums based on what securities they choose to own in their balance sheet, be it MBS or ABS or whatever else, right? The third is really energy transformation, which they historically have not done because that's not part of the mandate of

the construct of money. But if we start talking about capital investment for data centers, which then has ties to the cost of labor, it absolutely will start drawing connectivity and tissues to which monetary policy is now industrial policy. And that's what I think Powell knows. Powell has not been shy mentioning that the most unknowable risk today is the displacement that is happening in the labor force with AI at the center, where there is just no precedence for what that could mean for rate-setting policies. Somebody who is not going to have their job taken is all these politicians. They're all going to vote on market structure bill once the government opens again.

What's your take on the recent proposed market structure bill? well um the there's lots of i think complexity to different stakeholders still ironing out important conversations but the one that i think is clear that we can speak through today is that the cftc will own a larger domain uh over crypto than the sec see. And I think that is directionally correct, in my opinion, because the CFTC is in the business of financial innovation at large, and it's in the business of managing capital efficiency and leverage and derivatives products. And to me, the things that crypto is really building upon, which is this new settlement layer that brings capital efficiency at different speed,

is basically what that is. It makes more sense to me that it would be monitored as a commodity in that format. Now, I think it also speaks to the fact that crypto is global, right? Because the U.S. is very much an onshore regulator for investment securities that Americans are generally accessing, unless you're going to the different offshore private fund model, right? So it's very much like a domestic thing. Crypto is global, as are commodities. So it makes sense that the CFTC be the regulator who's able to look at the broadest section of global commodities markets and coming up with rulemaking. So that's good. And that clarity will allow more types of innovations to come through with DeFi protocols where historically, for instance, this past week,

Uniswap announced that they're going to turn on the fee switch, right? This is huge. It's momentous. People have been wanting this for a long period of time because Uniswap is very profitable. They settled trillions of dollars and there should be a way to bring value accrual to the token holders. And yet, Gensler had been so adamant about tying the economics of Uniswap to the token holders that it could never be turned on. Well, now they're turning it on. And I think that kind of proactive measures will be now more likely with a CFTC at the helm than the SEC. Coinbase also is allowing Monad to launch on their platform. Uniswap, Monad, all these things for the people who are like hardcore Bitcoin, they may be like,

why, what's the point here? More capital markets coming in this manner, whether it's revenue driving, whether it's launching of these tokens, you know, Coinbase had pretty much got rid of all ICO type, you know, behaviors, et cetera. Is this just like the merging of traditional finance and kind of the crypto world? Well, let's see. At the fundamental root of this question is, what is crypto, right? And like, you know, so many people have to be dead in a decade. That's but keep telling people. I mean, it's weird because earlier today I was at the Thai conference, which they did such a great job putting together an institutional crowd to talk about Bitcoin and crypto. But a lot of things people are focused on was stable coins. A lot of people focus on

tokenization. And it's because that's kind of stuff that JP Morgan can get involved in. And I heard the curse words of private blockchain one too many times from this conference yet again. And so it was almost like this idea of like, oh, are we going back to this high trust environment versus the low trust environment of consumer adoption that requires humans to just have institutional intermediation? Is that basically the current version of crypto adoption? And is that what we meant when we started the crypto revolution out of 2009? So these things, I think, have a pendulum and they swing back and forth. But one aspect of it is that the institutions are coming. And so the people that are spending money, the people that are

experiencing mergers and acquisitions have all today have been within those centralized service provisioning. So I think it's good. I mean, I think it's good that at some level, like these real problems are being tackled upon and it will have like consumer implications too. Like for example, MasterCard and Visa announced last week as well, that they're finally looking to settle the 20 year lawsuit that they've been having on their swipe fees with their merchants, right? This is a 20-year battle, right? We were like in college or maybe high school even when this had begun and it was still not settled.

Why are they settling now? They're settling now because they know stable coins are coming and they know that there is actually a giant competitor ahead that is basically going to take all their market share because you can't charge 2.5% for every swipes. And that's great for Americans, right? Whether you believe in crypto as privacy, permissionless blockchain, whatever. It is great that stablecoin is coming because it will, in the end, impact consumer better for having more competition in this space. And we should lot for that.

So I always go a little back and forth on what the motivation and mission of crypto is. And the thing that I think is my North Star is it improves people's lives. If it improves people's lives in whatever kind of dimension we're measuring it, then I think it's a success. And it's a great framework. Square trying to improve the merchants' lives. Now you can go and you can spend Bitcoin in a bunch of places. What's your take on this?

Well, I would say first and foremost, please don't spend your Bitcoin to buy a cup of coffee. We know that's not a good idea. There's lots of horror stories that come of it. And yet at the same time, I have always wanted more adoption of Bitcoin being used as a means of payments to engender the productivity question

of what Bitcoin means beyond being a store of value. So this is one step in the direction that is absolutely correct for the future role of what Bitcoin could be. And look, Lightning Network, I think for all its controversies and successes, is just a great player because they're well-intentioned, well-capitalized about that long-term mission, almost like the way that public utilities have to be. So what's great about it is ultimately the Lightning Network is built on Bitcoin, So this actually does take the security budget in mind and consideration where opening and closing the liquidity channels that ultimately provision for the transmission are Bitcoin transactions.

So even though not every aspect of things that the Lightning Network does accrues to Bitcoin, there are some elements of it which does. And that's great because Bitcoin has always needed more economic activities. And I think anytime you bring that narrative to the forefront, it's mission aligned for more prosperity for Bitcoin owners themselves too. That being said, I think there's a limit. You can't really spend more than like 600 bucks or something on the merchant side. And this again goes back to some of the fundamental challenges with how Lightning Network itself works by having collateralized Bitcoin that has to travel through some of these liquidity pools. But in the end, hopefully we can do larger transactions. And my own kind of personal view is that Bitcoin is actually more useful for larger transactions, that it's not the coffees I want to pay for.

It's probably the larger things like home purchases or, you know, fronting college education or other things that, you know, are bigger expenses that it's maybe worthwhile thinking about the construct of spending and saving in Bitcoin ahead of that consumption. Does the Square app allow you to spend with stablecoins? Yes. Yes. I think, in fact, it even, I think, gives the merchant a choice as to whether you want to receive or convert your cash into Bitcoin too, and you can pick. Interesting. Yeah. I just think that I understand that the promise of Bitcoin is this electronic peer-to-peer cash system. To your point, spending Bitcoin on small purchases probably doesn't make a ton of sense. At the same time, let people do what they want with their money. But it does feel like the stable coin has co-opted the medium of exchange use case. And I would actually argue

that's probably a good thing for people today. At some point in the future, if Bitcoin is stable enough and pricing is in Bitcoin, that may not be the case. But right now, you want to spend dollars that are going to be worth less in the future. Right. And so, um, enabling Bitcoin is great, but also it's like, you should give people an option to use the digital rails and stable coins as well. Yeah. In the end, um, you know, payments is a two-sided transaction for someone who's selling it, someone's receiving it. So in the most neutral sense, the hope is that whoever receives it then keeps it in Bitcoin too, and they will be able to accrue value. And in some sense, this also allows the possibility for many commercial companies to become Bitcoin

treasuries themselves, right? Which is an incredible thing. If you can own Bitcoin on your balance sheet as a corporate, whatever small business you may be running, the outsized impact that can have for you, for your business survivability in the future, if Bitcoin continues to pace its price, is humongous. And now we've provided ultimately that optionality for thousands of merchants out there who now can just actually take Bitcoin. And that I think is also the other side of, if the consumers are spending, well, the businesses are now going to save in Bitcoin. Makes sense to me. All right, where can we send people to find you on the internet? it you can find me on x uh my handle is dgt10011 and you can also find me on my sub stack same

handle amazing thank you so much for doing it we'll do it again next week sounds good