The Wolf Of All Streets - Heated Debate On The Future Of Crypto! | Crypto Town Hall

Episode Date: February 9, 2024

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Hey, man. Morning. Heard you got a lot of sleep. Yeah, you saw the group. You were pretty quiet today. I'm busy. Did you have Tucker last night? I literally, I'm so out of touch.

I didn't even know. No, no, I didn't get Tucker. He couldn't join, but we got a bunch of heavyweights. Man, the guy got an interview with Putin. You gotta say that's damn impressive. Yeah, did you? I'm assuming you watched it. I haven't watched it yet.

Yeah. We streamed it live and debated it. It was a two hour interview. The first half was pretty much Putin as expected, giving a history lesson. He does that a lot. Then the other half was answering some, some tough questions,

but I was actually impressed. Like I think Tucker did a good job trying to keep it balanced. You haven't, have you watched the snippets? The team was posting a bunch of snippets if you want to watch them. I would love to say that I have, but I generally opt out of the world when possible. That's okay. But there's a cool part yesterday as well.

So did you see the Biden meltdown at least? No, not the meltdown. Yeah, I mean, I saw that he called the president of Mexico. Sure. Yeah, so there's that. least not the meltdown the yeah i mean i saw that he called the uh president of mexico sure yeah so there's that but he also so what happened was we were streaming the the interview with um with tucker and putin and um as it was ending in the last like last eight minutes so streaming it live in the last eight minutes the team's like shit well biden's gonna do a press conference no one expected it um and we're trying to guess if it's going to be important is it worth streaming and he started it off it seemed boring nothing important

and then in the last three minutes of the interview or last no not even three like 30 seconds biden and the journalists begin arguing and the journalists start to really pressure him so that's happening almost meltdown and the interview is ending really pressure him. So that's happening, almost meltdown, and the interview is ending. So we ended the interview literally at that time and they started streaming the Biden one. So it's like two stories at a time. The leader of Russia being interviewed by Tucker Carlson and the leader of the US getting grilled and fighting back against journalists.

So it turned out to be a pretty epic space. And I went to sleep at like 12 p.m. my time. Not even that, no, no more. I ended up sleeping at like 12 p.m my time not even that no no more us and they'll see like 2 p.m my time so yeah that's wild man that's wild yeah it's a pretty uh stark comparison i guess between the two at the moment in mental faculty it's uh it's not my place to comment. Good. Don't comment. So should we talk about crypto? No, no. You got to vote Biden or Trump. Or you're not going to vote

as always. I've always voted. I just have to puke right afterwards. Okay, okay. You should vote RFK, I think. you've had him on your show haven't you i i mean i i theoretically that's who i would vote for but then you get the battle over whether it ends up being a lost and wasted vote and whatever but uh it is nice to vote for someone maybe you like a little bit as opposed to voting for the person you hate the least

fair point have you looked at another question have you looked at erc404 i was counting on ran and apparently he's got a stomach bug and he's really sick but i was counting on him to break that down for us so hopefully we have some guests because uh my first real interaction with it was having it explained here yesterday you know that i'm a boomer i don't really uh dig in until it's's big enough that it gets on my radar and I care. We've got a bunch of speakers coming in. I'll let you kick it off with the market overview and other topics that are boomer-friendly. And we've got a few speakers.

We've got Jason and a few others. Naveen is joining as well to discuss ERC404 because there is getting a lot of traction. Anyone else in the audience that wants to come up when we discuss that in a bit, do request and DM my account or Crypto. That holds better

and the team will bring you up. You have to DM them. Basically, I'll give us the markets are doing well before I went to bed. Let me see if they... Yeah, I've had a nice boom. Oh, there you go.

About 47,000 Bitcoin right now. It topped around 47,700 today. But it's a major move up, obviously. Just three days ago, we were sitting in the 42, 43 region, and people were wondering if we were going back down to 37,000 and what was happening and doom and gloom. And it took about five minutes for everybody to get really optimistic. I think we should have known when Solana went offline and somehow price still went up that

we were in a bullish trend and that things were probably going to continue upwards, right? Good signal when you shrug off what would have objectively been terrible news a year ago and things continue to the upside. So no big surprises here. I think at this point, you know, everyone wondering if it can take out that high from the ETF approval day, you know, right around 49,000. And if we're really heading towards 50 here,

bottom line though, is that things are looking exceptionally bullish right now. You know, Bitcoin up 10-ish percent in just a matter of 48 hours or so. Stocks, you know, touching basically all-time highs. I didn't actually see if SPX managed to take out $5,000 yesterday, but it was like $4,999.97. Last I checked, I think it got there. So hard to be particularly bearish at the moment, I think, things in markets, whether rational or not, looking very good.

I see Mark throwing up a lot of hundreds over there, Mark. I'm assuming you're agreeing. No, I mean, it's super bullish. We've actually never had this length in markets, meaning long-short managers are the highest gross they've ever had. Most of it long-biased. The net long position in futures has never been higher. So, I mean, we're definitely at a mania level. Not quite equivalent to 2000. I mean, 2000 was really, really crazy.

But this is coming very, very close on every metric. But, I mean, you're not bullish enough on what's happening in Bitcoin. But we'll talk about that later. We can talk about it now. No, we can't. Tell tell me why we certainly can't and look what's happening in bitcoin people just i guess they just either choose not to do math or they don't want to believe the math but you've got a situation where we had a fundamental demand shock in that all the boomers, you know, all our brethren and sister and all, you're technically, I don't think a boomer, but I am. And all my brethren and

sister and out there who have been basically restricted from buying, and many of them still are. I mean, Bank of America, Merrill Lynch, UBS, Vanguard, even LPL. Although LPL says it's just three months, not a permanent ban. So there's still a whole bunch that haven't banned. And yet, the ETFs are accumulating three times the daily supply of Bitcoin. And in two plus months, it's going to be six times the daily supply. And that's a fundamental demand shift that just people don't appreciate. And when you add the supply cut that's coming in April, things are going to get crazy. And then on top of it,

when we're going to hit 50, there's a big wall of shorts at 50 that are going to get liquid. And then on top of it, you asked about when we're going to hit 50. There's a big wall of shorts at 50 that are going to get liquidated here. And I'm wearing my green pants today. So in honor of the massive green candle that's coming this weekend. I'll take that. Anyone else have an opinion on what's happening here you think we're hitting 50k immediately i i don't know if we're hitting 50k immediately but it certainly seems we're heading heading there um i mean we saw 123 million in liquidations over the past 24 hours as mark mentioned as we get to the 48 and then 50k levels uh there's more liquidations on stack. And then we've seen this week, we've seen 653 million net inflows into the Bitcoin ETFs. Yesterday alone was 405 million of those inflows, which was the third biggest day since launch for net inflows for

the ETFs. And you're seeing the outflows from GBTC start to get smaller. So I think that balance is starting to be supportive of the Bitcoin price. Of course, we now have the Genesis overhang of GBT selling. That's going to be about $1.4 billion, but it's unclear how that will be spaced out. But I think on balance, we're starting to see the inflows into Bitcoin ETFs be more supportive of the price than and actually push the price, start to push the price higher. So I think it's it's super positive. You also get other other things, other effects like there's there's the headline going around that now Bitcoin is part of the top 10 assets in the world by market cap. I think that grabs headlines and attention, which is helpful for this space. Also, the four of the Bitcoin ETFs, BlackRock, Fidelity, RZBitwise, and ARX are now four of the 25 fastest growing ETFs of all time by assets gathered within a one month period. So it's amazing the traction that we're seeing. And then you add to that, you know, the eventual,

I think it's going to be as we get into the April, May timeframe, you're going to see the halving take place. That'll take out half of the supply of the market. And then we're getting into the latest from the Fed, was that they're now looking to balance employment and inflation goals. So they said they won't have the level of confidence they need on the inflation trend before the March meeting. So they're going to punt that discussion to March 19th, 20th, which I think suggests that the first cuts are likely to start in May or June. But then you'll see some easing from that as sort of right after the Bitcoin halving. And so I think from a macro and industry specific factors, you'll start to see supportive support of supportiveness on the on the price as well. I think on top of the technical reflexivity from the shorts at 50, it also just seems like a really psychologically important number where lots of

people start paying attention again, right? 50k sort of feels like one line in the sand where these are 2021 bull run numbers, and everyone who had written off crypto and bitcoin is dead it's very hard to say that when bitcoin is over 50k so i wonder if that like also leads to you know a big fomo uh run yeah just wanted to give them some intel on the genesis side so they obviously are applying in court but it should be net neutral because they're obviously Barry Silbert and co. who have a big interest in Bitcoin. So the way that they've applied for it, which is actually going to be unique in the bankruptcy because no one's done that, they've got GBTC.

So they want to sell 1.4 billion of GBTC and buy Bitcoin at the same time. So essentially, it's just trading from one left hand to the right. And hopefully, they'll be able to pay out creditors in Bitcoin because we've got precedent for that because we achieved it in the Celsius case. So depending on what happens in the court there, it's just more draining the GBTC swamp, saving itself fees because it's just fees that go up in the group. So hopefully that will be net neutral. So I don't see it as any kind of market impact.

Makes sense. Martin, did you have your hand up? Yes. Just a bit of perspective about the bull run. No idea if we're going to 50 and have this monster candle, but the real effect of the ETF isn't ETF. Don't care about BlackRock owning all the Bitcoin. It's that every bank in the world, banks hate crypto.

They don't know what to do. They need infrastructure, right? It's far too expensive for a bank to get into crypto. But they love ETFs. They can take somebody else's ETF and add another 5%. Banks love ETFs. And you are already seeing banks across the world preparing to include a Bitcoin ETF.

And that will be, when that gets into the public's consciousness, then you will have, I think, the biggest cattle you've ever seen anywhere. Because that adoption is a jump up to, it's a few levels above what we have now. And don't forget, I just made this post today, the whole crypto market is only 1.5 trillion. That's the market, 1.7 trillion that's the market 1.7 trillion that's the market cap of just nvidia so we are so early this market is still so small i think we all agree with that go ahead mark i just i made a comment a couple weeks ago that i stand by and you know make some people crazy when I say it, is I think more fiat will be converted into Bitcoin in 2024 than the entire existence of Bitcoin.

Yeah, I think that that's a valid prediction. Dave, go ahead. Yeah, I think that it's important, a couple of things. First of all, I totally agree with what Mark just said. I think the narrative is far more relevant than people seem to understand. I mean, we are so early in the ETF journey. is you have the most powerful organizations, you know, in terms of educational capability, telling people about Bitcoin. And they're not telling people, hey, you know, there's good cash flows or any other stupid shit. They're basically saying, hey, listen, there's a need for sound money. Hey, listen, you know, to paraphrase Mark, truth, you know, trust over truth. And, you know, truth over trust, excuse me, let's get it right.

Sorry, I don't want to paraphrase you, you know, wrongly, Mark. But the fact is, is that people are being educated. Not all of them are going to buy the ETF. Others are going to use it as a gateway drug. They're going to say, oh, okay, I got this. Let me go down the rabbit hole. And all of us have gone down that rabbit hole. So that's important. That narrative shift matters. And remember, half the investment banks that people have accounts at aren't even allowed to buy it yet. I mean, Morgan Stanley and Citigroup and these people still haven't allowed it. It will happen because they like money, as I think I forgot who the doctor basically was just saying. They like money and they're going to want to get that. So it's much more broad based than people realize.

The other thing that's interesting is it's going to dampen volatility. And, you know, anyone who's ever watched and I grew up in the equity markets a long time ago, but was on the trading desk building trading technology and trading when the Internet bubble happened. And as much as people like to talk about god candles, what we're seeing now is far more reminiscent of that. Two to three percent a day, day after day after day, is not what Bitcoin used to do. Bitcoin used to go, you know, YOLO in and come back down or whatever. That volatility is dampening, and that's much more what you would expect. So people talk about $100,000 god candles.

I mean, that's nonsense. But this looks a lot like the early days of the internet bubble with respect to the way these ETFs are trading. And I think that people should understand what that means. There's just kind of a level where people won't push it beyond for a day. That doesn't mean there isn't demand. And that demand is what needs to manifest here. And that's what we're seeing.

And it's a much healthier rally. Juan? Yeah, I agreed with everything Dave said. And also, I think it's also helpful to understand the liquidity conditions present. And so to provide a bit of perspective, looking past beyond $50,000 onto the last all-time high around $67,000, $69,000, if you compare to prior Bitcoin tops in 2017 and 2021, those coincided with major mainstream adoption breakthroughs. And in 2024, the market conditions in the lead up to the launch of the Bitcoin ETFs, which is another mainstream moment, have been quite different than in those past instances.

So, for example, in 2017, when Bitcoin reached its high at that time of $19,000 or so, that happened on the same day that CME Bitcoin futures were launched. And then by February 2018, Bitcoin fell to $6,000. In 2021, Bitcoin reached a new high at that time of 65 000 uh the day after coinbase listed uh three months later bitcoin had fallen uh to to down to 30 000 um and then went on to set the the november 10 high uh the november 10 high of 2021 uh right after uh a couple like 20 days after Biddo had launched. But in these three tops, those prior three tops were portended by signs of market exuberance. So in the two weeks leading up to those tops, BitMEX per rates had averaged 253%,

66% and 21% annualized for each of those. And the Bitcoin daily volume on Bitfinex had seen an average of $749 million, $395 million and $387 million respectively for each of those three instances. Now, this year, in the lead up to the launch of this Bitcoin ETFs, PERP rates were 14% annualized and Bitcoin daily trading volume was only 100, 105 million on the daily average. So all that to say that conditions are much more tempered this time around in the lead up to the ETF launches. And since then, conditions have remained relatively tame. So I think as we are talking about getting into a situation where the

supply drops, where the macro environment, the easing environment is constructive, and we see additional demand from wire houses completing their due diligence process three, six months into the launch of ETFs, I think that is a really, really constructive setup that I'm not sure most people are realizing, really. Mark? Guys, I want to double tap on everything Juan just said. I don't think people are snapping to the issue that we're not in year four of the cycle. We're still in year three. The halving hasn't occurred. The supply shock hasn't

occurred. We all know it's going to occur, but it hasn't occurred yet. And the parabolic move doesn't happen in year three. It doesn't happen in crypto summer. It happens in crypto fall. Crypto fall doesn't even start until June. And june to june we're going to see the same type of you know irrational exuberance that we see in in every one of these four-year cycles and oh the four-year cycle doesn't matter yes it does it's hard-coded in and human behavior is hard-coded in our dna we're not going to change that. The only thing that subtly changes, two things to me. So one is normally the halving event would double the fair value. Just math, right? If the miners costs are fixed and the block rewards get cut in half, either half the miners go out of business

or the price adjusts. So the price adjusts. This time it's subtly different in that now we have transactions that are higher. So let's just be conservative and say we get a one and a half increase in fair value. That's from 50 to 75 instead of 50 to 100. Well, then we get closer to fair value post having right around having then you get the the FOMOing in and we haven't seen the beginning of the FOMOing in that pushes it past fair value and in each previous cycle at the peak we get to about 2.3 to 2.4 x fair value. So that's because of leverage. And leverage and stupidity and gambling and all that stuff enters in.

Yeah, there's not as much leverage this time. Some of the bad actors have been weeded out. People will get creative, but let's say it doesn't go to 2.3 times this time. Let's say it only goes to 1.5, you know, fair value. No, let's say 2, and it's going to get to 2. So that's 150. That's baked into the cake.

That's just the normal, logical progression of fiat converting to Bitcoin. And you guys were talking about the Putin interview. I haven't watched the whole thing. I watched from kind of 115 on, where he starts talking about China and the dollar. And I mean, one, I love watching somebody who has been painted as this crazy person speak incredibly intelligently, incredibly logically, incredibly dispassionately

about facts. And it was like an advertisement for Bitcoin. He basically said that the U.S. policymakers have made a series of bad decisions about their currency. Now they have no way out but to devalue. And the thing that just gets lost every time we start talking about the price of Bitcoin is the price of Bitcoin never changes. One Bitcoin is one Bitcoin. What changes is the value of the currency other people denominated in.

So in Argentina, it's already worth a lot more because the Argentinians fucked up their currency. Same thing in Venezuela or Turkey. And the U.S. dollar is losing its hegemonic reserve currency status. I mean, here's the crazy stat that Putin quoted. He said five years ago, I think it was five years ago,

he said 3% of their oil transactions were denominated in yuan. He said now it's 34. And five years ago, 34% were denominated in dollars. Now it's 13. That's a huge change. And so Bitcoin denominated in dollars is going to continue to rise. And so you got to own some.

Yeah, Mark, let me play with some numbers there that you gave. So your forecast was more fiat will come into Bitcoin. I presume you mean Bitcoin and Bitcoin ETFs, and then the ETFs will buy Bitcoin, than the market cap of Bitcoin, a trillion of inflows approximately. Is that what you're saying? Exactly. I mean, what I mean by that is actual fiat converting into Bitcoin. So if you think about the market cap of Bitcoin is 900 billion billion. That doesn't mean $900 billion of fiat is converted into Bitcoin. It's a small fraction of that. And I will argue that it's, I don't know the exact number, but I'm guessing it's somewhere around a third.

So like $300 billion-ish, something like that. I think $300 billion is coming in, and that will push the value higher. Okay, so at the current price of $47,000, the Bitcoin to fiat currency dominance, there's about $165 trillion of all fiat currencies globally. So that's about 0.6% based upon the current price of Bitcoin. If there was another trillion of inflows and the price was reflected, let's say we hit another $2 trillion market cap post-halving,

that would be over 1% of the entire market cap of fiat currency, approximately approaching 16%,17% of gold. And yeah, the prophecy would and that's a realistic thing that I think could happen, given all of the different trends and all of the different things that are happening that would drive someone into a safe haven and the fact that we've got an ETF. So the prophecy of Bitcoin eating fiat currency is an inevitability, and we're watching it roll out in real time with every cycle. Mario, do you want to talk about ERC-404?

No, no, I got Danish up. Danish, what's up? Okay, oh, well. I wanted to hear Danish talk about ERC-404. Well, no, I'm not going to do that. I will say that it is incredibly interesting to hear so many people talk so much about probably one of the most boring interviews

I have ever watched i watched it from beginning to end it was incredibly boring he didn't give any insights and by the way there is no bitcoin utilization in russia that is allowed so ultimately he does not believe in bitcoin number two where are they mining 11% of Bitcoin right now? Where is 11% of Bitcoin being mined right now? But not by his approval. It's not under his approval. He doesn't want that to happen. He doesn't think there's any sovereign mining going on in Russia, Iran.

I don't know anything and I would not say anything about Russia because he would literally kill me. So anyways, number two, because he is an authoritarian leader that doesn't allow people to speak against him. Number two, I do want to say that BRICS is not a thing. I don't know why Bitcoin people are so excited about it. China is in freefall. One of the core centers of BRICS is literally dying right now, like in front of us. They're in a deflationary spiral. If you don't know what that is, maybe you shouldn't be trading Bitcoin. So the point is China is in deep, deep shit right now. If you're not watching, I'm just letting you know. So BRICS is not going to be a thing. So when he talks so intellectually, you know, back in my neighborhood, they'd call Putin

a smart, dumb motherfucker. Like he sounds really smart, but he's saying really dumb shit. And, like, that's what it sounded like. Sorry, now I can definitely never go to Russia. That's an American-centric version of the world, Don. No, it's not. It's literally bricks is not happening. So this concept that, hey, we're going to see American dominance go away, it's just we're not even close to that because China,

honestly, China had a shot at gold. They shot at the king and they missed. And now they're paying for it. That's what's happening right now. So if China can't- That's just so wrong. I mean, I don't want to be a jerk about it. What was China's CPI last week?

What was China's CPI last week? When was the last time you were in China? Tell me the CPI. When was the last time you were in China? It does not matter. What was China's CPI right now? When was the last time you were in China? Tell me the CPI. When was the last time you were in China? It does not matter. When was China's CPI and CPI right now? When was the last time you were in China? This is the dumbest conversation.

I'm telling you about deflation occurring. When was the last time you were in China? First of all, I won't talk about my personal business. That's number one. Number two, how about this? I was in China the last five years, like right before COVID. But that's as far as I can go. Darnesh, in the real world,

in the real world, there's this thing called deflation. And it's actually what free markets do. You don't, you don't... So hold on. Deflation is a good thing right now. I'm sorry. China is going through a good thing right now.

That's why the Chinese government is freaking out about deflation occurring. They've had 16 straight months of deflation. But in the real world, they have this thing that happens in markets where stock markets go down, real estate prices go down, and you allow your economy to take out all the shit government intervention that's been done. And if China allows the market to do that, which I doubt it probably will, but if it does, it's actually following free markets better than America right now. No, that leads to bank runs and it leads to a spiral. Like what do you, okay, long story short, what all I was going to say is that there's some like mental masturbation going on about BRICS,

which is fine. You guys can continue to do that because that's what crypto people do. But the reality is that deflation is real in China right now. They've had 16 straight months of deflation. This month was the sharpest drop in CPI since 2009. If you guys remember what happened then. And China is in deep trouble. They've made some really big strategic mistakes, which they're not, which essentially renders bricks. How many straight months of deflation, disinflation? It's not really deflation, it's disinflation. Has Japan had since 1989? Since 1989, how many times has CPI been negative in Japan?

Since 1989. But Japan is not a world leader right now. Japan is actually in trouble. Japan is not in trouble. Again, China has a terminal population just like Japan. Have you been to Tokyo? Have you seen real estate prices in Tokyo? Have you gone to restaurants in Tokyo? Have you seen...

You're kind of acting like what I said about Putin earlier. All I'm saying is the reality is that the data is showing very clearly that China is in deep trouble. I am surprised to hear that people are willing to argue that. That is an American-centric... The American data. You haven't read anything from China. You've read Western media. It was actually released by China, just so you know. That data is literally from China.

China just released it. If China is releasing that their CPI is negative 16 months in a row, then you're telling me that it's not, okay, all right. This is why it's a little bit hard. The long and short of it is that, look, the ETF narrative did not play out. We have not seen that. We didn't see it shoot up immediately.

Like, like, by the way, I was probably the only person that came up here and said ETF is not going to lead to a crazy amount of inflows. Maybe me and Dave. Are you absolutely joking? Are you absolutely joking? Has it led? How much? $10 billion in two weeks. $10 billion in two weeks? Are you joking? It was moving money around from GBTC. That is net. We can have this conversation.

$10 billion is net. I'm done. I think you guys are being a little... Long story short. I think you guys are being a little pedantic here. What was interesting about the interview to me were two things. One, what he said about the dollar is important, especially if you're interested in Bitcoin.

You know, whether or not you guys are talking about short-term stuff, the point is that there was no reason to ever create serious inroads or serious financial tools to get around the dollar before the weaponization of it. And you had everyone using it and they had no choice. And to some extent, that's changed. And that's relevant, I think. I think the point of the interview for him was to basically have every American walking

away thinking, you know, I want to go to sleep, not to war. And I think he did a pretty good job of doing that, saying, look, this is a very boring story that you don't understand. You know, now you go, you want to go to war, right to war right and it's like well i don't have anything to say i i don't even begin to understand this um and i think that was his goal signing yeah i'd say the main the main purpose of the interview if if anyone could take something from it is how even look i'm no big fan of putin but how narrative and propaganda driven the world is including all americans all brits and all of the western world the fact that if people were watching that interview and didn't understand that there is an alternative reality that's propagated by media in order to get the people

to believe in the propaganda of their government. And if Americans and Brits watched it and realized that actually there are two sides to every story and propaganda is half of what's determining everything that Dinesh came up and said. So, you know, to me, that's what people should take away with it. The governments, they simply push out agendas, and half of what you believe in is because your government wants you to believe that for very deliberate reasons. And there's normally parallel universes where we can jump on Twitter spaces and speak to someone

that's actually been to China, actually been to Russia, actually been to Japan, and understand that actually everyone's playing the same game and there's no concept of good guys and bad guys. That's what I took away from it. I mean, is the real estate industry in China completely fine when they're putting up for sale signs today? Did you guys read that? To to me a good real estate market is not using it as a financial product it's using it for what it's actually meant to be which is living it rather than taking savings out of the economy and forcing everyone to speculate on real estate creating wealth and equality that drives a rich poor divide which is what we're experiencing in real time.

I'm cool with the narratives, but you're also speaking crazy propaganda. I'll walk you through really quickly, and then I got to jump in. No, but Dinesh, what I'm saying is a bad real estate market, a bad real estate market is a good thing. But they found their municipal governments. Crisis should crash.

Most municipal, Google this. People can't afford their houses. It might be helpful. Hear me out. Municipal governments all over China are at risk right now of defaulting and the government is likely going to step in in the next few weeks because most of them own portions of the real estate market that was put up on crazy leverage. Like you're literally speaking the opposite of what everything you I've heard you speak in your, in our time. So when, when that happens, you have to, you have to de-lever, you don't roll over and

create another, it will take down municipal governments. Jesus. The government is actually intervening. That's the point that I'm saying. Exactly. If they do, if they do, you mean different than QE? You mean different than the Fed intervening in the United States and the U.S. real estate market collapsing? Have you looked at any of the recent real estate transactions in the United States down 80%? China is doing exactly the same.S. media and you believe the propaganda that they put out, no different than the propaganda the Chinese put out, the propaganda the Russians put out, everyone has their own propaganda. But Simon's point is so eloquently stated. Everyone's playing the same game. And if you want to just stay in your side of the story and not believe there are two sides of the story, you're going to sound, well, whatever. And that is the case for Bitcoin, because there's only one currency that allows you

to exit whatever the government's agenda is with what they're going to do with their currencies. And that's the role of gold. It's just really hilarious to hear you all say that, Simon and Mark, when literally all you do is speak one side of the Bitcoin story. When anybody else comes in and says the other side, suddenly your religion hurts. And this is like the challenge with crypto in general. The day you actually look at it from an objective perspective, I think it will actually be better for the community in general and will bring more people in. Instead of this cult of religion.

What side of the story would you like to prefer? Okay, a proffer. What side of the story do you think is being ignored? We've gone from zero, literally, a science project 15 years ago to nearly a trillion- dollar asset with higher highs and higher lows every single year. What, what's, what part of that story do you want to talk about? Jesus, we must be back in the bubble cycle again, uh, since people are starting to say, uh, uh, zoom out again. We said this throughout every bear market. We were here.

But it's not even a bear market to begin with. What I'm saying is... Part of the story is that it is a financial asset. It should be treated as such. Institutions are going to come in, and this is the first time that I've seen DGens who used to be DGens

be so happy that the suits are coming. It is fucking hilarious. But suits are coming it is fucking hilarious but suits are coming we're all there trad fi is coming in and you know what it essentially will start acting like the rest of trad fi so your beloved asset will start acting just like all the others it's just a financial instrument it's not a religion and has gold with that has gold done that for 5,000 years? Has gold acted like a financial instrument? Yeah, but has it been consistent? Has it been consistent when you price your stocks?

Has it been consistent throughout 5,000 years? The answer is no, it hasn't. Well, it's stored its value. It's held its value for 5,000 years. And it's held its story. That's actually like not, that's an, it's stored. It's stored its value. It's held its value for 5,000 years. And it's held its story. No, no, no, no. That's actually like not a, that's an incorrect statement. It's not always stored its value.

It's had, it's had, it represents a head. Well, so is Bitcoin. That's all it is. And so is Bitcoin. Yeah, but until, but Bitcoin actually is better than that. That's the thing. This is the narrative that doesn't get said. And that's what Scott and I talked about once. And it actually completely changed my view on Bitcoin, which made me actually think about Bitcoin as an important

financial asset, which was actually not correlated. Don't make it gold. Gold is stupid. It's better than gold. That's the issue. It is better than gold. You're doing the pitch. Simon, that's what I'm saying. Gold is not stupid. This is the funny thing. Gold is the base layer of money. Gold is the base layer of money. Gold is the only money in the world. It's the only currency that central banks don't have. Gold is that. Bitcoin is better.

It's more portable and it's more divisible. So yes, now that it has the same scarcity as gold, and now that will ultimately the same scarcity as gold, and now that will ultimately be a replacement for gold, but gold will still have a role as a physical store of value, and Bitcoin will be the digital store of value and the base layer of digital economies in the future. But that's a process that's going to go over time. Gold is not stupid. Gold is the fundamental foundation of all of finance and all of economic growth in the history of

mankind. It's a stupid argument. It's also underperformed the S&P 500 by like 3,000% over the last 60 years. It's not an investment. It's a saving vehicle. Gold is meant to preserve your wealth. Investments are meant to increase your wealth.

And so if you're looking at it as a speculative asset, then... However, Bitcoin... And so if Bitcoin is supposed to act like that, then why is Bitcoin... Because Bitcoin is... These are circular arguments, guys. It's exponential. And that's the point that I was actually trying to make earlier, which is actually the pitch that would work for people

that are not just obsessed with the god of Bitcoin, that they really focus on what is this valuable for? How does this fit into a portfolio? It's an uncorrelated asset that sometimes acts like growth and tech and sometimes acts like gold. That is what makes it incredibly interesting for anybody to add it to their portfolio. That is the point that I was making, but it's okay. All all right uh with that we'll see you guys later dave jason bye thanks yeah i didn't want to be rude um but i just want to comment real quick about the the thing with like uh russia batting on bitcoin like like honestly like any country that's batting on bitcoin doesn't stop people from buying bitcoin like that's the number one thing out there first right um you know anyone um you

know my background is you know i used to work at fubushi since 2015 um i've known some i think i've seen simon a couple times when we did defcon 2 together and back in shanghai back in the days but um the idea is that i've been living in shanghai for like the last eight years and um there's a lot of things i think people especially especially what he said about the Danish. I think a lot of things that he said is coming from a very one side of view of like what's happening. Right. The whole point here is he's forgetting something, which is like during the third term where Xi Jinping, you know, got reelected for a third time. None of them in the committee, like no one got replaced in the committee comes from an economic background. No one has a background in economics.

So for most people who are actually in, I've been studying about kind of like what the predictions are, is that they are kind of accounted that the economy will not do well. Or like this is not, this is within the scope of expectation that a boosting economy or a boosting GDP will no longer be a priority under the strategies. It's very, very clear. I don't understand

why is it hard for most people to understand. Just look at the leadership, like look at the background of leadership. It's no longer about boosting economy. So yes, the Chinese economy has gone down significantly. Those who have left it, I lived through it the same way as Europe or any place in the world. They have their own mandate and they have their own strategy that I think a lot of times people underestimate.

Again, there's no one strategy that works, but I can give you an example. The Americans, for example, came up with this idea of GDP. But a big part of why GDP is so successful for the American economy is because they leverage two things. They have a credit system that is very mature and they have a debt system that's very mature. Look at the Chinese market, for example. The debt and credit system is basically fucked up. It's been the only thing that we've been trying to do is try to catch up the last 20 years. And the last thing that actually happened was a bunch of scammers coming out with P2P concepts and a bunch of people lost money. So how do you compare a system where you have like basically it's three components that's boosting up the economy versus China, which is basically just one element that's boosting economy, which is spending.

Right. There's the borrowing, the lending, all that stuff is kind of shady as fuck um there's just no culture within embedded within the chinese system that gets people excited uh and they get people bullish about lending because the culture there in china anyone who knows about asian culture understands that asians love to save they don't have to spend right whereas because the economy in the u.s is highly highly highly mature compared to the chinese economy people are more comfortable about the credit system. People are more willing to spend. Right. So these are like two different things. I think a lot of people don't really like consider.

But the whole point here is I think this argument, like whether that's going down or not, and that affects Bitcoin, I think that's quite irrelevant. Right. I think there's no point arguing about this. I think the point here is that that bitcoin beyond what's happening right now there's actually two things that we're looking and you know from a venture perspective because you know we're a vc fund i invest in web3 um there's a utility i mean it's funny that no one kind of like mentioned this like does anyone not know the history of web3 like the only reason why

prices go up like one is because speculation utility, the speculative utility around tokens, and there's just an actual technology utility around it. All the things you guys have been talking about, it's all about trading, it's about speculation, but realistically Bitcoin itself has a very fundamental difference between Bitcoin today versus Bitcoin two years ago.

I just want to make one comment here, and I don't want to jump in front of you, Dave, but I'll do it and then I'll give it back to you. Your point that the Chinese or Asians don't like to spend, they like to save, and that Americans are different is such a youthful perspective. And all you have to do is study a little tiny bit of history or talk to somebody over 40 years old. A whole generation of Americans from the 1920s through the 1980s did not believe in spending at all. Zero. They were Depression-era babies.

All they did was save. There was no debt. We delevered this entire country for 60 years. And then in 1971, the world changed. And we went on a path towards destruction, which we're on right now. And that's why we all spend, because we're being stolen from by untethering our currency from gold. And it allows fiat, the fiat fiasco that I call it, to occur. It's not always been like that.

It's only been like that for the last 50 years, but most people who talk about this stuff haven't been alive that long. So I don't mean to pick on anyone in particular, but it's just not true that Asians are savers and Americans are spenders. No, I agree. I agree. There's obviously a trend where there is a learning curve for everything, right? Sorry, I'm making the assumption that there's no learning curve. So you're absolutely right. There's no learning curve for everything in every culture. But I'm saying that in, I guess the assumption here is because it's more,

we're talking about, I guess, Bitcoin, then we're talking more about especially the economy going down the assumption here is really that we're talking about the last 20 years the last 10 years right um especially if people are not mentioned about real estate um their previous speakers mentioned mostly like real estate right so it's like there there is that there is still a very weak credit system in china and so people prefer to say because they just don't believe in that credit system.