The Wolf Of All Streets - BTC Hits $108k! Live With Grant Cardone & Eric Weiss #CryptoTownHall

Episode Date: December 17, 2024

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Morning, everybody. Welcome to Crypto Town Hall, our daily show at 10.15 a.m. Eastern Standard Time. There was a long time there where it was tough to find conversation pieces, news to talk about. Now it seems like the velocity of news and the Bitcoin and crypto space is so fast that we can't even keep up with everything that's happening. And things that once upon a time would have been the biggest piece of news ever for the space have become footnotes that are entirely missed. It's pretty astounding. I was talking on my YouTube show this morning with Paget from Gemini and with Andrew Parrish from Archpublic, who's here pretty often. And we were saying that just six or seven months ago, we were sort of

positing, well, what happens now that Larry Fink is out there talking about Bitcoin all the time? What happens when BlackRock just says, hey, we suggest that everybody have a 2% allocation to Bitcoin? That literally happened last week and didn't even make the news cycle. Crazy that BlackRock put out a paper saying that everybody, you know, that 2% is reasonable. Others were saying, you know, 1% to 3%. To me, it's just nuts how many things are happening at once and how hard it is to keep up with them. One of those big ones, Matt, I'm glad you're here. We had this sort of narrative in, I guess, the end of 2020, beginning of 2021, when MicroStrategy started to buy Bitcoin. And Michael Saylor, we saw him really, truly orange-pilled and him trying to orange-pill

other companies. And so there was this, I think it was February 2021, and he sat down with 2,000 CFOs and was teaching them how to put Bitcoin on the balance sheet. And I think a lot of people were underwhelmed that it sort of didn't happen at the time. And then kind of as you dug in, you learned that the gap accounting rules were really unfavorable. And basically, nobody in their right mind would put Bitcoin on the balance sheet if they had to mark it down to the lowest price in the quarter when they reported earnings, right? And so that was a big problem for a long time. Those rules were changed months ago. But I just realized in the news cycle in the last two days that that's now actually kicking in, which means that companies theoretically can add Bitcoin to their balance obviously, talking to people every single day on behalf of Bitwise with institutions, the ETFs obviously being the sort of lead topic there. But you're also talking about Bitcoin adoption.

How big is it that now these companies that maybe have been looking at it that we haven't heard about can probably do it if they want to? Yeah, it's great to be here. It's a very big deal. Just so people understand, you had to market down to the low price of the quarter and you could never market up ever. So literally, if you bought this idea they had ever heard to add an asset that can only go down in value. I think what you're seeing is this trend is bigger than people think. And I think that's actually the important piece there. You know, the common response to this idea of companies putting Bitcoin on their balance sheet is, oh, you know, Microsoft's never going to do that or this or that company's never going to do that. And that remains true. But enough companies are doing it that this is a major source of new demand. I mean, companies alone bought something

like, you know, 250, it'll probably end up being 300,000 Bitcoin this year. If that doubles next year, right, that's that's three, four times the total amount of Bitcoin supply. So this story doesn't have to be very true for it to have a very big impact. And I think it's true enough, right? It's now dozens of companies that are regularly adding Bitcoin to its balance sheet. And, you know, as you know, Scott, there's just not that much Bitcoin out there. So it's having a big impact. I i mean a hundred thousand of those were added by more more than a hundred thousand were added by sailor in five the last five weeks right yeah every day you wake up and it's another billion dollars but it's not just him right it's it's marathon uh it's companies in

japan there's a there's a there's a fund in as in Asia that raised $150 million to invest in companies, convince them to put Bitcoin on their balance sheet. And again, if you get 100 companies doing this at this scale of the asset, it's transformative to the supply demand. It's interesting because a lot of people have been concerned what happens if Saylor doesn't announce on a random Monday that he's bought 1.5 or $2 billion worth of Bitcoin at this point, it's become such an expected narrative. What if he runs out of dry powder, but you know, having 50 more companies buying in smaller amounts behind that effectively negates that narrative. That's exactly right. I mean, we now have these sort of three

horsemen of ceaseless demand. We have companies, not just Saylor, but others. We have governments moving into the scene, and then we have institutional buyers, and those are all on top of the retail demand. So, you know, if MicroStrategy doesn't come through, another company might. If they don't, you could see governments accumulating. If they're not, one of the things I see right now, one of the reasons ETF flows have been so strong is all the sort of forward leaning institutions want to make sure they have Bitcoin on their year end statement. And so they're piling in so that you have different people to pick up the slack. And I think that's why we're in this sort of relentless bull market for the time being. I just pinned a tweet above from David Bailey, who's obviously been on the show a number of times, the CEO of Bitcoin magazine. One of the people certainly that gets credited for the orange pilling of Trump and clearly, you know, obviously getting him on stage at Bitcoin Nashville, saying hundreds of public companies in process of adding Bitcoin to their balance sheet. They need to hurry. Now, I know that people in this industry are prone to exaggeration, but I don't think he would flippantly say that unless he actually knew something. And then in some of the comments,

if you go in, people say, you know, name names, because I talked to five today. Yeah, I think that's the thing. You know, there are lots of companies that have seen people do this and be rewarded for it by the market right these companies are pattern matching to the success we're seeing we're adding bitcoin to your balance sheet makes you you know friendly to the crypto community boost your share price it seems like a win-win and you know there are thousands to you know, 10,000 public companies around the world. If 5% do this, if 10% do this, it is a major source of demand. I know it's not the source of demand people were thinking of going into this year.

They were thinking of institutional demand. Maybe they were thinking of governments. And those remain very important. But this is a real source of demand. I think you'll see hundreds of companies doing it. And you have to assume that they'll either, I guess, buy a chunk when the approval happens, or they'll follow a bit of a seller strategy and just dollar cost average over time. I don't mean by raising a convertible note. We're seeing, obviously, miners do that following in his footsteps. Riot just bought a bunch more Bitcoin. But I think most institutions will not do the leverage part.

You're just going to add it to the balance sheet slowly, correct? Yeah, I think that's right. I think they'll treat it like, I hope one day, retirement savers in America treat it, which is to drip into it over time, to just have it as a piece of the puzzle. Now, look, it won't be every company. It's not core to every company's business. It's not relevant for what they're doing. They want to use their treasury for other reasons. They're not

allocating to other assets. But I think it will be core to many of them. I agree. And I think that the accounting rule changed just to kind of put a bow on this. Probably we've had a lot of companies looking at it and now we're going to get those announcements. I just have to assume that, you know, that that was still holding back quite a few people. And Matt, also, I mentioned kind of that BlackRock passively said everybody should just, you know, 2% is a reasonable allocation to Bitcoin. That sort of was missed in the news cycle. In your conversations now with people looking to allocate to the ETFs, is it 2%, 3%? Is it 1%? Because it's a big difference. We were talking about 1% six months ago or a year ago. I mean, if people allocate 2% instead of 1% and everybody does that, you're talking about two times as much Bitcoin being bought. That's exactly what I

found funny about this. It's not just that people missed BlackRock saying you should add Bitcoin to a portfolio, but all of a sudden we doubled the allocation, right? We went from one to 2%. You know, we're seeing a lot of people go to 5% at Bitwise. 5% was considered there be dragon's territory even 12 months ago. It was a crazy idea. People would laugh you out of the room. We were still talking about getting off zero, having $8 invested. And now you're talking about 2%.

And not just 2% for a few people at a wealth manager, but 2% is the base rate for a portfolio across every exposure. I think it's really significant. And if you think it's the end of the story, you're wrong, right? In a few years, maybe in a year, maybe in two years, as Bitcoin volatility goes down, you're going to see BlackRock saying 5%, right? This is not, we haven't reached the local maximum. There's more to go here. I thought it was an unbelievable story. And, you know, just look at the flows since they put that out. We've had

5 billion of flows into these ETFs over the last 10-ish days, I think that BlackRock message is having an impact. On the Ethereum side, we've seen pretty sustained bullish flows there as well, which is kind of going unnoticed as well. Not by you. Yeah, actually. No, not by me. I'm big on this. It's actually more flows than it should proportionally be getting, right? North of $2 billion in flows, which if you compared the market cap of Bitcoin to ETH, you'd expect it to be like four to one. Instead, it's like two to one. And I think what's going on there are a couple things, right? On the one hand, ETH sort of has its mojo back, right? It's right at the center of three big themes in

crypto. It's right at the center of stable coins. It's right at the center of tokenization. It's right at the center of what's going on with AI agents. That's all taking place on base. So it's got that narrative flow. But the second piece is, you know, a lot of people bought Bitcoin for the first time when the ETF came out in January. And what happens when your friends buy Bitcoin six months later or eight months later or 12 months later, they start buying ETH. This is the oldest story in crypto. So of course it's happening in the ETFs and it's going to continue to happen. But I'm really optimistic about ETH going into next year because of that trio of drivers between stablecoins tokenization and and ai we're gonna go to the to the rest of the panel momentarily this wasn't meant to be the

matt and scott show but tends to happen sorry uh but you you also posted a tweet yesterday that i retweeted that kind of uh blew my mind because i've been harping on this narrative that uh stable coins are the killer app, obviously, of crypto. I say it all the time. And that the bulk of USDT was on Tron and that people were using Tron because it was fast and cheap. You posted a chart yesterday. I think it was since, was it since election day? But since election day, now ETH has gone basically parabolic on USDT on ETH and is now leading significantly over Tron just in the

past, what, month, month and a half? It's absolutely crazy. You know, I had the same reaction when I found that chart that you had it when you saw it. It's just like a shotgun, right? The election went off. ETH was way below Tron. And it's just staircase past it and has never looked back. It looks to me like that's going to go to ETH in a walk. I think it's the clearest visual signal I've seen of what we've been talking about, which it's the rebirth of crypto in America. Of course, ETH on Tron is largely an Asian phenomenon. And I mean, USDT and USDT on ETH is a US phenomenon. And yeah, if you want any signal that the US is back in crypto, there is no better signal than that one. It made me really bullish about where we're going. I love it.

Yeah, Matt's tweet is pinned in the nest above for anybody who didn't see it that chart. Basically, the blue line is Ethereum, is your STT supply on Ethereum. And the green line is Tron, which is still impressive, has done nothing but continue to go up steadily. But ETH basically went parabolic there after the election. Carlo, you had your hand up. Go ahead. And we circle back and take a little victory lap on ETH and FT's, Scott, because I can't have a conversation about the surge in ETH without at least talking about the fact that we're seeing massive inflows back into NFTs. Yesterday,

a spike of $76 million, a nine-month high in NFT traffic. I told you this. I went on Spaces a couple of ago when board apes were like $300,000 or something and got eviscerated because I said, I will buy, I promise I will buy a board ape if they go back under $25,000 and everyone went ballistic. And I bought one at $19,000 a few months ago, the floor of nine, nine ETH or something, just because I said I would, I don't really want to buy an ape by the way but uh here we are um but yeah i think that uh we're starting to see things rally right across the board so that i don't think there should be any surprise that nfts are going to rally alongside everything else go ahead lou i don't think lou's mic is on. Okay. Or is working. Lou, I'm going to drop you down and then you can request and we'll close your app request and we'll bring you back up. So, Carlo, I mean, do you think that that trend continues to rage? A huge community that's pivoted into its own brand just dropped their token today.

And apparently it's being reported that for every Pudgy Penguin you own, you got a stimulus drop of $85,000. Where do you think that's going to rotate now? Straight into NFTs. Yeah. yeah i mean this is like the the arbitrage here is going to be that people are going to cash in that token and i think rotate heavily into nfts interestingly i i know dave weisberger was here yesterday or maybe it was actually on youtube and he said i don't understand we were talking about kind of martha market froth and he said i don't understand why ftt token still has like a billion dollar market cap and was trading like crazy and And then I read actually that for some reason, I have no idea why, because I'm not up on NFTs, but if you

held FTT, you actually got a Pengu airdrop as well. Yeah, there are several collections that also could have benefited as long as they, I think, you know, hit the deadline to get verified on the Discord. So it's a massive stimulus that's coming across the board. I don't know what's going to happen to the price of that Pengu token. It's typical that when you get an airdrop, there's an immediate dump, and then it retraces possibly. But there's no denying that you've got now a tremendous amount of liquidity coming back into, and this is liquidity coming to NFT holders. So what are they going to do with this liquidity? And across the board, you're seeing that all the forgotten projects of 2021 that were active

throughout all this bear market are now starting to see a resurgence as well. Cool Cats, you've got Gary Vee actively buying NFTs again. You've got the Cool Cats pumping. All those NFTs from back in 2021 that everyone thought were dead and gone are now starting to come back over 1E floors and so forth. So it's just another indication that we're in a full-on bull market. And it is an obvious play that you're going to see that rotation because it's happened before and it's just so predictable. We have Muneeb here and Alex both. So it's a good time to pivot because there's a lot being built on Bitcoin as well. You know, we talk about, of course, NFTs on ETH, Carlo.

We know that there's been, at least over the past year, 18 months, this huge sort of explosion of ordinals and runes and all this building on Bitcoin. But Muneeb, Alex, you guys have been here with Stacks, obviously, long before that building, before it became so fashionable to build everything on Bitcoin. But you have, I just happened to read, I pinned it above from Bitcoin L2 Labs, SBTC launching and a rewards program there. I know that the term yield still gives people PTSD to some degree, but you're doing it in a very interesting way. Can you just kind of talk about what's being built generally and what you're doing with SBTC here? Happy to. Hey, everyone. Muneeb here, Stacks founder.

Hey, man. Good to catch up, by the way. Been a while. I know. I know. I think, of course, I wanted to follow up on something that Matt said about Bitcoin demand, like how there are so many different sort of like, you know, sources for it, like institutions, potentially governments,

companies doing it on their balance sheet. But I feel that there is one sort of one very big, almost like a black hole for Bitcoin that doesn't get talked about that much. And that is enabling yield on Bitcoin. If you look at Ethereum, a very large percent of the supply, I think it's probably 35% or so, it's locked up because people are earning yield on it and they don't want to sell because it's an income problem. And Bitcoin BTC yield doesn't really exist. You can do it in small ways through centralized parties, but people have PTSD from BlockFi and the last cycle and so on.

So I think this cycle, especially with all the development that happened for Bitcoin L2s, there is almost like this new category opening up where your Bitcoin can actually directly earn yield without the centralization company risk, right? So you can deploy it in smart contracts, you can actually start earning decent yield numbers. And that is likely going to be another big factor in the price of Bitcoin, at least I believe that, right? It's almost like a black hole, a lot of Bitcoin is going to start flowing into these L2s like stacks, and then people will park it. And because they'll be earning a yield on it, they're even less incentivized to sell that thing.

And another thing is going to be decentralized lending markets, right? Like where a lot of the OG holders, I've been holding Bitcoin for almost like 11 years at this point. And a lot of people from that era, or even a couple of years before, they don't want to sell, but they're looking for liquidity now. They want to lock up their BDC and take a small stablecoin loan. And they don't trust companies. They do not want to go to centralized companies that have been burned, or they've seen their friends burned many times.

So I think that's another market. So when there is an OG holder who can now get liquidity on even 2% or 5% of their holdings, they're even less incentivized to sell. And I think that's going to be a very interesting dynamic on the supply-demand side of Bitcoin that these L2s are actually going to enable. So speaking of that, as you mentioned today, SBDC is going live. People who are sort of like not familiar, Tinko Stacks has a Bitcoin L2. It's one of the earlier projects. It's secured by 100% Bitcoin hash power. It's extremely tightly integrated with the Bitcoin.

And now sort of like Bitcoin deposits are opening, right? So we're doing it sort of like slowly. It's a decentralized way to take your Bitcoin from L1 to L2. And now Bitcoin deposits are opening. So we're doing it slowly. It's a decentralized way to take your Bitcoin from L1 to L2. And to incentivize early liquidity, there are some protocol incentives. And the interesting thing here is that the incentives are in BDC, because Stacks is a BDC yielding asset. We can go into that, how that exactly happens.

But it's a pretty unique asset. I think the only one out there in CoinMark market cap top 100 or anywhere where you hold SCX and you earn BTC. So what's happening is that if you deposit Bitcoin and there's a cap, like I think initially it's a thousand BTC cap, we might raise it to 3000 and so on slowly. But that BTC can now earn direct BTC yield. And why is the product doing this? It's to give people a taste

of what Bitcoin yield is going to feel like, right? Because these people now have to move their BTC from cold storage. They have to actually use a web wallet. Bitcoiners haven't used web wallets, right? It's not Ethereum, where everyone has used MetaMask and things like that. So there are a bunch of these really good web wallets like leather and xworth so it's to incentivize these people that let's move from your old clunky cold storage put a little bit of bitcoin in a web wallet well put it in in deposited in the protocol and then once they do all of that and they start seeing like a five percent bdc yield coming up in their wallet i think they get a taste of company like oh interesting like what else is out there right

so that's that's sort of like what's happening but i think it's a very very big step for bitcoin personally like we've been working on all this for like two plus years so it's a pretty pretty big day for us it talked about obviously especially whales but i think it'll be anyone eventually depending on how high the price of bitcoin goes but to avoid selling to be able to basically take a loan against it. And you kind of highlighted how dangerous that had been with CeFi and some of the platforms that we had before. What does that look like to you in the future? How will that work safely? And do you think, I guess also, we talk about seller buying every day. I think that might kind of be his end game, as he said, like offering a full breadth of Bitcoin financial services and effectively becoming a Bitcoin bank.

Right. I mean, is that where we're headed? Yeah, I think, I think, I think absolutely. I think once you start accumulating a lot of Bitcoin and your mindset sort of like shifts, I feel like when people, they enter the space and look at Bitcoin as a trade, right? Like they look like, oh, this thing is going up. I'm going to enter and I'm going to exit. But the real orange filling happens when people realize that, you know, you're never exiting your Bitcoin. This is your savings. And you just want to keep accumulating

more and more Bitcoin. And I think the next phase of that is that it's not just accumulation. You need to turn that into productive capital. You need to build financial services, both centralized and decentralized. So I feel like Saylor is doing God's work, but it's still on the centralized side. And I think some of the work happening at Stacks and some of the other L2s,

we are basically enabling the decentralized version of those financial services. And I think both are going to exist. Coinbase, for example, they started their CBBDC on base. And I think it has cost like $2 billion and BDC issued on it pretty quickly. But it's kind of like in the middle, like you are trusting Coinbase and the centralized parties. You're going through KYC. You probably are going to get like a tax hit when you convert your BDC to CBBDC because there's a custodian in the middle. And I think what we're doing is we're more on the decentralized end of the spectrum,

like fully decentralized, fully open. Anyone can use it. There's no one in the middle to do Kibbe. There's no custodian in the middle that you're sort of relying on. I think that's very interesting. Yeah. Alex, obviously you're part of the Stacks ecosystem building these tools. I mean, I assume you generally agree, but anything to add to what we said?

Yeah, I just think this is going to be really big for builders like the the only option you've really had to be able to make deployable bitcoin at this point is to port it over into the eth ecosystem which obviously has plenty of d5 protocols and applications and things going on but like as we saw when ordinals kickedginals kicked off a year and a half ago with everything, people want to keep it in more native Bitcoin realms, right? It kind of goes against a lot of the ethos on it. And so that's the thing I'm excited for.

I've talked to a lot of builders who are on this. It does sometimes surprise people when they find out that the Bitcoin ecosystem, and especially on top of Stacks, have all of the same primitives and capabilities right you can do Bitcoin lending through zest you can hit Dexes like bit flow and Alex and velar on top of it like there's really big opportunities and I just think at the end of the day like this is where defense going to end up on top of Bitcoin right like Bitcoin is the digital gold it is the asset um so i'm really excited to see what people do with it um and as they just kind of discover the amount of opportunity that exists there

kind of talking about the centralized versus decentralized use cases of everything crypto basically but i you know it's obviously a gray sliding scale. Maneeb, you sort of pointed out CBBTC, which still to me sounds too much like CBDC for my brain to process it. But CBBTC, Coinbase is wrapped Bitcoin. Where do you think that your average person, I guess, in this cycle and then future cycles

will land on using those services? Is there going to be a point when they become so easy for mainstream to use that people will default to the decentralized side? I think ideally, everybody wants to use a decentralized protocol to do these things. But it's still pretty complex. As you said, Bitcoiners haven't even used these wallets. Yeah, I think but I think we're getting there right so this is this is sort of like that interesting thing that uh i i noticed that you know people are talking about nfts there but some of this actually goes back to the revival that we saw with ordinals and nfts on bitcoin l1 right like when that happened suddenly first the degens came right like all of these

nfc traders and people came. But then capital followed and developers came and they started improving the UX of these wallets and actually testing them on mainnet with sort of like real capital, real assets. And all that helps for like the next generation, right? Right. Like now we have like almost two years of these Bitcoin web wallets getting polished up. The U.S. is getting better. Hardware support is getting better for multi-sig support is coming for large whales and holders. And I think this cycle, this sort of stuff you've seen before, right, like before, you know, stable coin lending became a big thing on Ethereum. Like in twenty seventeen, people were trading like, you know, kittens or whatever at that time, right? And Bitcoin is following sort of like that evolution,

but much later. But because Bitcoin is so much bigger, I think the impact of it is potentially going to be much larger, right? Like just the amount of capital that's available or the amount of sort of like institutional demand and sort of the scale of Bitcoin I think it's it's it's just huge and I think that's that's like what I'm pretty excited about I'm digging into sort of other news here and like I was saying at the beginning it's just crazy how much news there is I think on a daily basis so we have rLUSD launching today on ARP. I didn't even see this, but Exodus Movement, so the Exodus wallet, was approved to list on the New York Stock Exchange. Does anyone see that? Because they've been trying for ages. There was a story, I think, yesterday that Athena was launching a stablecoin, or we won't call them algorithmic stablecoins. I don't remember what

they call their stablecoins coins to not call them stable coins, but that's backed by BlackRock's build fund that launched and got 65 million in TVL on day one. I mean, the velocity of stories right now is it's just astounding. Lou, I know you wanted to comment before, cause your mic working. Lou is in the glitch. Welcome. Welcome. Paul, you have an issue. Yeah, there you go. I'm sorry. Yeah, Lou, we did it. We did it. It was SEO's error. Are you a boomer like me?

Unfortunately, yes. I was going to hark back actually just to build on something that Matt was talking about with regards to the likelihood of Blackstone upping their percentage from 2% and that, you know, I remember the first time that I met Kathy Wood in 2017, and she was talking about how, you know, she was the first institutional investor in GBTC. But she kept on having to sell because the price kept on going up and she was capped at what percentage of her portfolio could be in one single investment. And I think what we're going to see at Blackstone is as the price of Bitcoin rises and rises, they're going to have people who are at three or

4% of their portfolio, and they're not going to want those people to sell. So, you know, I think over time, BlackRock is undoubtedly going to raise that 2% to 3, 4, 5. Yeah, or they're going to, you missed maybe some of the conversation, or they're going to find more unique ways to use options, obviously Coinbase stock and people freak out, they don't realize that these people have balanced portfolio strategies for these funds. And when something becomes overweighted, they have to sell it. They have to. They have a fiduciary duty to maintain the balance in their portfolio. Yeah, exactly. And I totally agree with what Muneeb was saying. I really think the great untapped thing that's going to send us to a million is when this really goes mass market and the average person on the street starts buying it

for whatever reason. And it could be for interest. I don't know what it's going to be, but we're going to find that over time. And I think that's really when history is written, it's going to be when billions of people bought it that really sent it flying. Yeah. Matt, how do you view that? As Bitcoin grows and all these Bitcoin adjacent stocks that are part of funds become overweight, assuming prices continue to go up, do you think that will cause some sort of selling pressure? Do you think that options can solve that or that there's going to be things that mitigate that? Well, I mean, I think we're a long way from that, right? You know, my starting point is 95% of the people who are going to buy Bitcoin still haven't bought it.

So they have a long way to dial up before we have to worry about them sort of decumulating and being overweight. They're massively underweight right now. You know, Bitcoin, crypto is maybe 3% of global capital markets and the average allocation in people's portfolios is still zero. So until we get up to 3, 4, 5, 6%, I don't think they need to sell back. Eventually that will happen for sure. And it does happen, as you mentioned, with these specific portfolios. You know, we run portfolios that are capped at X percent and of, you know, any individual name and those portfolios have to sell.

So there is a national capping side. The flip side of that is during the market pullbacks, you'll have the opposite effect, right? So you would think that this would overall be volatility dampening over time. It would trim when the market screams and it would add back in when the market pulls back. So on the margin, I think that's true, but I still think we're early innings for people getting up to weight even before they get overweight these assets. Paul. Thanks. One thing we didn't talk about in detail was all the state level reserves that are being kind of talked about out there and texas is probably the biggest one uh pennsylvania from a few weeks ago florida's been talking about it so it's going to create this

um i wouldn't say a competition but it's just like a Bitcoin friendly state versus non-friendly state and very, you know, as a reserve, as accepting taxes in Bitcoin. And then as, you know, the overall private sector gets more friendly to Bitcoin because there's more competition and it might be on firms' sheets it's also attracting companies there is some kind of some level of competition of states saying hey we're pro bitcoin state we're pro crypto state here's here's what we're doing to do this and it's not something that you really think about i don't think it's going to add up to a lot in terms of purchases because ultimately states run deficits. A lot of states run deficits and they just spend. They don't have large reserves

kept, but it's just the ability to attract other companies or becoming a business friendly state for Bitcoin. i think that's something that's going to be very important and you're going to see it's going to be uh the difference is going to be are you a bitcoin state or a non-bitcoin state i think that's going to be very clear in the coming definitely in the next four years it's going to be very clear what states and that affects also on the energy side obviously texas is is a big state for Bitcoin mining. You know, there's there's some states in the Midwest for the green, green energy states in the southeast around Tennessee Valley Authority out west with remote gas sites.

So there's going to be a lot of connections with energy and Bitcoin. And the fact that now it's it's becoming Bitcoin friendly is going to push it even further. So Texas, yeah, to your point, Texas has already been Bitcoin friendly in general. And so seeing them propose a strategic reserve, which obviously has a long way to go to be passed, is huge. But for people who don't realize how big it is when states, especially like Texas, propose something like this. I believe last time it was reported the Texas economy is $2.6 trillion. That makes it the eighth largest economy in the world, larger than Italy, Canada, Russia. You're talking about a massive economy. This is actually,

in theory, would be much bigger news than in El Salvador or even any almost other country in the world adding Bitcoin to the balance sheet. These state budgets are absolutely massive. So this would be huge, huge, huge news. And I think it's just a part of the process of getting to what Matt was talking about before, these sort of pillars of demand, right? The institutions, of course, with the ETFs, but then talked about companies adding it to the balance sheet. Well, if we have states and countries adding it to their holdings on the balance sheet, it's incredible. I mean, Matt, we're sitting here talking about this,

right? Talking about Pennsylvania or Texas. If the United States does follow through with a strategic Bitcoin reserve, which people are saying could even happen with executive order. And we talk about this a lot, but like this is the United States of America. Every I feel like every country in the world is going to be put on notice that they have to have it on their balance sheet. Yeah, if we if we actively buy Bitcoin, I think there's a difference between just converting the Silk Road holdings into a long-term position and adding Bitcoin. If we get something like Lummis' Bitcoin Act, which calls on us to acquire a million Bitcoin, then the race is on and Bitcoin's at a million dollars in short order.

Yeah, you would have to see every country would have to, from a game theoretic perspective, stake their claim before it's too late. So part of this recent rally, I think, has been the market slightly re-rating the possibility that that will happen. This is an idea that bubbled up, and it hasn't gone away. It keeps coming back. Important people keep talking about it. I think there's a non-zero chance that it happens.

And if it does, you know, I think it gets to the end game pretty quickly. I really think the rally you see in Bitcoin, if that happens, would be hard to imagine. That's scarce asset. I totally agree. Grant, glad to have you here. If you're actually available, obviously, I've been close friends with your brother for a scarce asset. I totally agree. Grant, glad to have you here if you're actually available. Obviously, I've been close friends with your brother for a long time. I think it's been fun to watch the process of many people being orange-pilled, obviously, like yourself. We always talk here about strong opinions loosely held and that the smartest people on the planet

are the ones who actually do the work. You tweet about this all the time, how much research and due diligence you do before you get into anything. Who do the work tend to find their ways to Bitcoin and never go back. And we've seen that with many, many billionaires over the years. Well, you seem to have come in wholesale at this point as a believer. Now, I follow you closely and you've launched even this real estate and Bitcoin fund, which I think is exceptionally novel. I would love to actually hear more about that and why now, you know, at $100,000 Bitcoin, you're very much sold and launching things like that. Yeah, thank you so much. Yeah, we're super excited about what we're doing. And as you said, I've been seven years, I've been buying real estate here in Florida for very aggressively, by the way, because I hate the US dollar. If you've ever followed anything I've said, I've been for seven years talking about cash is trash. Why save money? It's impossible to do it. So we've been converting, I have four or five businesses that make a lot of cash. And then we've been converting that cash into real estate. And as you all know, real estate is very

heavy. It's slow. It's illiquid. In the last, this year, just this year, we bought everything with cash because the debt market hadn't cooperated with us, which means we don't have the leverage that we've had in the past. We know we'll get it later. But after meeting with Mr. Saylor three weeks ago, I'm actually on my way to his house right now to show him something that I'm doing. We launched an asset. We found an asset that we could buy 15% below market. It's brand new, institutional quality, already occupied, cash flow positive. This is happening, right? So I'm funding this

and then we offer it up to, I'll backfill it to my audience that already invest with me. I got 18,000 investors that aren't Bitcoin people. They're real estate people that want cash flow and depreciation and stability and, you know, conservative 8 to 15% returns. Um, we're going to add the Bitcoin and then every year out of the cashflow, out of the NOI of the property, sorry guys, um, out of the, um, the real estate's free cashflow we'll purchase, we'll dollar cost average, uh, each month. And, you know, we'll take a deal that's $87 million and it should be in the first five years. I mean, like I'm not, not even hitting some of the optimistic numbers you guys are talking about. We're talking about a four or five X on a real estate deal that has no debt. So in a year or two, I can still go get the debt, return it to the investors, own the Bitcoin for nothing, virtually for zero, and be paid four or 5% on the Bitcoin that the real estate is buying on a monthly basis. So I'm not going to do one of these. I'm probably going to come to the market. I mean, we showed one to our little audience, and we've already raised $90 million in about five days.

Incredible. 90% of these people have no Bitcoin exposure at all, which means we're introducing a new audience to Bitcoin, which I think is great for the community and for mass adoption. And I'm going to try to bring 12 of these to market by March of next year and create a fund around the 12 and then go public with the entire portfolio, which would be another big bang. You move fast. If everything works out. You move fast. Listen, you said you met with.

Well, I study slow, though, dude. I study slow. So listen, you said you met with... Well, I study slow though, dude. I study slow. You know, nobody's seen... I've been buying Bitcoin since 14, but didn't tell anybody because I was, you know, we were promoting the real estate. So I didn't want to confuse

my real estate investors. I was privately taking cash flow from my real estate and saying, okay, I'd rather have a Bitcoin every month than have cash. At some point, I don't have a Bitcoin every month than have cash. At some point, I can't buy any more groceries. Yeah, totally agree. It's funny.

I see we have Eric Weiss in the audience, the man who orange-pilled Saylor. I think, actually, I might have introduced your brother to them at one point at the conference. But it's amazing how many people have the story like yours who say, hey, I met with Saylor three weeks ago and now I'm all in. Eric and I had a story where the ex-president of Argentina, Macri, at the Bitcoin conference a few years ago, a friend of mine said, hey, I want to introduce this guy to Saylor. Can you make it happen? I called Eric and Eric's on stage. Eric, what, like an hour after I asked you to sit the Argentinian president down with Saylor, you had him like at your, at his house and, uh, Macri didn't speak for two hours and then left. And it was like, he had met the, like, uh, had met Jesus

in person. Right. I mean, these meetings are pretty, having pretty common. I have to give Grant some credit here. Michael and I have met with a lot of people over the years, but I don't think I've seen anyone move as decisively as Grant has. So huge props, buddy. You're kicking ass. I'm excited for this. And shit, I might be an investor. Dude, are you over there right now? I'm going to be over there at the time you get there. I'm just listening in to this awesome- Yeah, I'm on my way right now.

Awesome mile spaces first. Yeah. And Eric, thanks for your guidance, man, in the first meeting. It's funny that, you know, I don't know. I was there two hours. I bet I didn't say 20 words. Yeah, I've been in that room.

So Grant, can I ask you, and Eric, you're always present for these things. Like you said, you've been buying quietly since 2014. So it's not like you needed some great light bulb moments. But in those conversations when he's breaking it all down for you, What's the most sort of decisive message that really gives people, you think, that aha moment or tips the scales? For you, I guess, specifically. Well, you see, when we left that meeting, I have these five companies and they're all cash. They're cash positive every year and they have been for 25 years. I mean, they're great companies, right? I'm not talking about the real estate right now. And he said to me in that meeting, he's like, look, you need to go public.

And then you need to base. I don't understand securitized bonds. I wouldn't fucking know where to start. Like, I don't even think I could spell those two words together. Right. So I don't know where to start. I don't know how to go public fast enough to launch. And, you know, frankly, speed is the speed at which somebody can move at something to me determines how much power and influence and success they have without being reckless. I've already studied for seven years. So once you know, once you have conviction, then you move. So I can't go public fast enough because the, the, the, the securities won't allow me, you know, that they're going to put me through a fucking grinder. So we figured out how to do this by taking the real estate that we already own and or have under contract. Um, and basically

rather than using the debt markets, which are nasty anyway, we'll just do it with the real estate deal. Like if I do this right, I could literally be the largest REIT in the country. I could, I could dwarf equity residential that's been in business for 40 years that, that, you know, pays out 3% dividends. I could be bigger than them in a year. Because they'll take forever to get on this train. How dependent is that on the price? And, you know, what's the math on where price needs to be for something like that to happen? I don't think the price of the Bitcoin has anything to do with it.

It's the real estate that stands underneath it. Because there's no going to zero in my scenario scenario because you're not going through the real estate. The Bitcoin go to zero. I still have the real estate. I still have the cash flow. I still have the tax depreciation, still have rent growth. I'm basically combining an old world asset that's proven for 2000 years with this new world asset that's going to replace all the old world assets. So I can't do this with gold or silver and I'm not public, so I can't do it with a stock. So

I'm going to scale it and then we'll go public. I'll prove it out, then go public. Imagine having a billion dollars worth of real estate with no debt and another $250 million worth of Bitcoin paid for by the real estate. And now I go sit down with Howard, Howard, um, the commerce secretary and say, Hey, I want to create a mortgage product out of this over at Canton Fitzgerald. I want to create a mortgage product out of these, these, uh, properties. Uh, the best time to get a mortgage is when you don't need one. The best time to a mortgage is when you don't need one. The best time to get debt is when you don't need it, right?

And if everything's paid for, they'll look at that real estate and the Bitcoin as one entity, not as separate ones. So I'm not having to put Bitcoin on margin. I can literally get long-term debt is our hope in the future that we get long-term debt is our hope in the future that we get long-term debt

on the property and the Bitcoin combined. Worst case is Trump hammers the Fed. Interest rates go back to zero. We have a black swan event. We're going to go to zero again. And if that happens, then I just go grab long-term debt from Fannie and Freddie against the real estate. Do you generally have any concerns about the real estate market at the moment? No, we're in correction.

In the shit I buy, I'm buying stuff 15% under market right now. So we have to buy under replacement costs for this to work. I'm buying a deal that should have sold for $88 million for $72 million right now. We just did $400 million worth of deals. They should have sold for almost $700. These aren't single-family homes. These are large apartment complexes being bought from institutions that are having to liquidate to balance their balance sheets. It's interesting, Eric. You were probably with him. But his sailor was on, I think

it was CNBC yesterday. And she asked him the stupid Ponzi scheme question. And he gave the brilliant answer, comparing it to Manhattan real estate, right? And said, that's how it's an economy. It's not a Ponzi scheme. This is how things grow. You take debt on something that appreciates to build more things. And that's how New York City has become larger. Eric, you've been saying that forever. Literally on my first podcast with Michael, I think in 2020, he made the Bitcoin is digital real estate, it's New York real estate, you never sell it sort of comparison, maybe for the first time. I mean, is that the framing grant that you have, Eric, that you have still? I mean, is that sort of, you know, we hear digital gold.

I like digital real estate actually better. So I think what Grant did such an exceptional job of is kind of what we all try to do, which is once you understand that Bitcoin is good and you want to find a way to, you know, get more of it, for lack of a better way of saying it. The thing that you know best is your own personal life or your business. And so everybody's got unique circumstances. If you're in a seller circumstance and you have microstrategy and you have a public entity, yeah, that's great. You can issue securities and tap the public markets in a variety of ways. If you're in a grand situation and you have unbelievable kick-ass businesses that print

cash and you understand your business is inside out, you can find novel ways, in Grant's case, very quickly to incorporate Bitcoin into that. If you're an individual, you know your life and your financial balance sheet better than anyone, and you can find ways to optimize your life and your balance sheet with Bitcoin. And that's kind of the beauty of kind of Saylor's insights is he gives you lots of different ways that you might consider incorporating and plugging into the Bitcoin network, as he says. But I haven't seen anyone do it as quickly as Grant's done it. So props to Grant. But the takeaway is, you know, we don't all have businesses like Grant, unfortunately, but we all have something in life and some way to plug in and apply it.

And it's worth some introspection to see how Bitcoin can boost you like it's going to boost, you know, the Cardone real estate empire and microstrategy, etc. Eric, you weren't here for the sort of beginning conversation. I don't think maybe we're listening. We were talking to Muneeb, who's still here, sort of about the, not the endgame, but the future of Bitcoin, obviously, being a financialized asset with, you know, yield and borrowing and lending and all of those things. I mean, what do you think the time, I'm assuming you agree with that, but what do you think the timeline for that is with this sort of mass acceleration we're seeing? I think that's all predicated on SAB 121 going away. And I would expect that if Paul Atkins confirmed as chairman of the SEC, my guess is that goes away very quickly. Certainly, I would guess in the first quarter that he's there. And that opens the floodgates. And then it becomes a matter of how quickly the banks can

get their custody solutions to an institutional grade level where they're comfortable custodying digital assets. And I think at that point, we will see massive acceleration in lending, borrowing, getting interest on your Bitcoin. And that will really boost the price in dollar terms of Bitcoin. Do you think structurally, it'll look like loans on other assets, you know, real estate, boats, whatever it is? Or do you think that it's going to be more aggressive because it's Bitcoin in the early innings? You know, like obviously in CeFi, which was a disaster, we saw these like really high loan to value ratios, right, where you had to deposit a hell of a lot of Bitcoin to get anything meaningful back. Do you think it'll

be like that? Or do you think it'll be like normal loans on any other asset? I think it's going to be as ubiquitous as dollar based loans on everything that, you know that banks can think of. They can be pretty creative when it comes to finding ways to make money. And I think that's one thing that Wall Street is really good at, is squeezing a lot of juice out of those oranges. So I think we'll see some very creative things. We'll start out pretty plain vanilla with rates and, you know, and loan to value rates that are a little bit offensive due to the volatility of Bitcoin. But in time, I think we're going to see, you know, banks develop a better understanding, more comfort with the asset and more traditional financing opportunities. Muneeb? I think I'm enjoying the conversation here about different types of companies putting Bitcoin on their balance sheet.

So I think connecting it back to the chat earlier about Bitcoin L2s and potential yield people can get in decentralized ways. I think just like we're tracking how much Bitcoin is on the balance sheet of MicroStrategy or how much Bitcoin Tesla has and other companies have. I think it's very interesting to also track how much Bitcoin is ending up on these different L2s. Like if you look at what Coinbase did, I think they have maybe like 20,000 BTC on base now. You look at some of the other older Bitcoin L2s like Lightning. I don't know the recent numbers,

but it used to be like 4,000 BTC. Blockstream's liquid network has like 3,000, 4,000. And I think with SACS, SBC going live, like as a decentralized version with a pretty, pretty large project and a large community of developers behind it, we're going to see these numbers going up. And I think one of my OG Bitcoiners friend was joking that these are rookie numbers, right? Like it shouldn't be in thousands of BTC. It should be like hundreds of thousands of Bitcoin that's actually being deployed in these L2s. And as I said, they're going to become like a black hole, like where the yield aspect is actually going to just lock in a bunch of liquidity. And people who don't want to sell the OGs who would be able to just take decentralized small loans against their Bitcoin.

And I think that's going to have a very interesting sort of like impact on the supply demand of Bitcoin. I agree. And I want to circle back quickly on something. Grant, you can jump in if you want. Yeah, I was just going to say on the banks, I think the banks are a long way from being able to play in the space just because their unrealized losses on their books are probably exceeding 2008 levels. I mean, to get a loan from a bank today, you're going to need twice the money on your account. They're just lending you their money, your money. Even if you're a great customer of the bank with big cash reserves, you're not getting a deal. So if they can't lend money in this environment with old currency that they've been operating with for a thousand years, how long do you think it's going to take for them to adopt this new entity? I just think there's a big drag time.

Also, just getting into any of the, like me trying to buy right now and set up accounts on whatever mechanism I'm trying to hold my Bitcoin in, dude, it's still very slow. So you got this huge supply issue. You got mass adoption taking place with countries, governments, companies looking at it, individuals, wealthy individuals, guys that are going to figure out how to put some bang on my real estate. I'm basically real estate powered by Bitcoin, like Michael says. And then I got to go get an account, which could add a week, two weeks, three weeks. The wheels aren't greased. So I think there's a lot of time for people to get

into this game and figure out how to maximize it. Yeah, I mean, I agree. I think the banking relationships are still contentious. Operation Chokepoint 2.0 is still a thing and hasn't ended and will take time to unwind. Right. It's not like every bank is going to be able to turn on the spigot to your point the second that Trump becomes president or that we have some changes at the top of the regulators. It was interesting, though, Eric, you talk about SAB 121. For those who don't know, obviously, if you've been listening to the show, you know, it basically was a SEC memo that said that prevented big banks from being able to custody Bitcoin without

also having enough cash on the other side of the balance sheet to account for it. So obviously, you can't custody an asset if you have to raise the cash on the other side of the balance sheet. That would be insane. But what happened when they did that, interestingly, was before the ETF, is other side of the balance sheet, that would be insane. But what happened when they did that, interestingly, was before the ETF, is that all of the custody ended up with Coinbase and to a lesser degree, Gemini Fidelity custody themselves for the ETFs, because the banks at that point weren't basically capable of doing it. And they went nuts because the BNY Melanies and the

state streets and stuff, they obviously wanted to be able to be the custodians for BlackRock and the other ETF issuers and couldn't. Sab 121 then was put up Congress, Senate, passed both and was vetoed by Biden. So for anyone who missed that story, that's what happened. Of course, then BNY Mellon later got an exemption. But Eric, I think what you're saying is when it's not on the books anymore, and Goldman, State Street, BNY Mellon, and all of them can legally with no question marks, custody, Bitcoin, that's going to be sort of the explosion here. I mean, even David Solomon last week, the CEO of Goldman said, we're going to do all this, we just need regulatory clarity. So they're just waiting. That's right. I also think it's a big part of why Trump became so favorable on Bitcoin and crypto.

Basically, what happened is after the SEC, Gensler put that out, and it went to Congress, the Biden administration said if it made it to their desk, that he would veto it. And I think they expected the Democrats to kind of fall in line with the party, Biden administration said if it made it to their desk, you know, that he would veto it. And they, I think they expected the Democrats to kind of fall in line with the party and it wasn't ever going to get to their desk. They were just kind of signaling that, you know, SAB 121 was here to stay. And they were, I think the Biden administration and frankly, everybody was very surprised that even mainstream Democrats voted in favor of banks being able to custody crypto and digital assets and Bitcoin. And it did make it to Biden's desk and he did have to veto it. And so I think

when Trump saw that, he said, hey, there's 50 million votes here to be pro-crypto. There are no votes to be anti-crypto. And that's when he came out swinging so hard. And some people believe that that's also why the Ethereum ETF got approved so quickly, because the Biden administration kind of freaked out that Trump seized the moment, got all this crypto support, and they needed to do something to try to get crypto people back on their side. And the Ethereum ETFs, which were seemingly likely not to get approved, got approved very, very quickly. That was the straw. I mean, of all the things that have happened this year, living here in the, you know, stranger things upside down, that was the craziest.

Because the Ethereum ETFs were dead in the water, down the road. And it took all of 18 hours for that to entirely flip. And it was right, as you said, when Trump became pro-crypto, Bitcoin, crypto, and then sort of more crypto. It was such a reaction, but one that didn't, I don't think, as we can see, help very much. Yeah, I got to hustle to meet Grant and Mike. Thanks for this forum, man. It's great spaces. And chat with y'all soon. Always welcome. It's about time to wrap up anyways. Grant, it was great to have you pop in.

Hey, thanks a lot for giving me a minute. I'm not going to harass you over and over again to come up and recap your meetings. 100%. No problem. I'm a transparent guy, so I tell it like it happened. I think there's another person on the planet who can say that more honestly than you, buddy. And everybody else, thank you so much.

We'll be back, obviously, tomorrow, 10, 15 a.m. Eastern Standard Time. Also, I always say, but follow our amazing guests who we have on stage. We've got 5,000 people on any given day or more listening, And we're very, we curate very carefully who we allow up here to share their views, because we want to make sure that it's only the smartest, most knowledgeable people who are building in the space and can share really accurate views on what's happening with the market. So please follow them when you leave the spaces, of course. And also, you know, since we have Muneeb here, guys, check out SBTC, everything that's happening on Stacks. I've been a huge fan for a long time. Count Muneeb as a

friend. And it's a lot of fun to finally see all the things you've been talking about for so many years coming to fruition. And I think it's only going to improve. All right, everybody, we'll see you tomorrow, 10.15 a.m. Eastern Standard Time. Thanks. Have a great day.