What Bitcoin Did - Bitcoin Will Never Have Another 80% Crash | Eric Yakes

Episode Date: August 27, 2026

“Everything’s structurally changed.” Eric Yakes is back on the show to explain why Bitcoin may never suffer another 80% crash, and why the recent 50% drawdown could prove that the four year cycle is finally dead. We discuss whether yield curve control has arrived under another name, why Bitcoin is becoming a hedge against monetary debasement and the potential for a great rotation out of AI and gold and why gold could reach $10,000 while Bitcoin runs from $80,000 to $800,000. Eric also gets into how the US push for stablecoins could unintentionally accelerate Bitcoin adoption, why stablecoins may provide the route to hyperbitcoinization, how Bitcoin could become the world’s most valuable collateral and why fractional reserve banking might actually help Bitcoin win. THANKS TO OUR SPONSORS: LEDN SWAN ANCHORWATCH BLOCKWARE BITKEY CAPE FOLLOW: Danny Knowles: https://x.com/_DannyKnowles Eric Yakes: https://x.com/ericyakes

Everything structurally changed. And now people are viewing this asset differently. The further up we saw this AI trade go and the further down we saw Bitcoin go. It's just like, oh, what a perfect, perfect opportunity to rotate out of the gains from that. Those three variables are kind of like setting the scene that I think change like how Bitcoin gets adopted and by who? If Bitcoin is in 5 to 10 trillion market cap range, now we do start to get into that world of like, okay, from a global standpoint, this is one of one of of the most deepest, most liquid, homogenous assets that kind of exist globally. There you go on, do the gun show before we start.

All right here, right here. Yeah, that's not going to the show. This isn't a Breedler podcast, that's not going in the show. That's going to be. I will end up in that genre at some point in my life. What, you're going to be like a gym influencer? Yeah, I like nerdy stuff too much, but at some point in my life I'll probably be posting pictures of myself shirtless and giving people health advice. You can have to get a much better shape, man.

I know. I know. I'm on almost on month two of a sober streak to we're dropping some pounds. 2025, traveling with you that whole time I was throwing it on. I was going to say, I've probably not seen you in about two months. Is that why? Yeah, that's probably one. Yeah, it's the reason I didn't come to New York. Well, I will see you soon. We'll break that streak. How's it going, man? Good, man. Well, it's like, wow, the past, the past few weeks have been big. We are, we are back. I didn't budget for any of this. I don't think anybody really did. And there's just been a lot of major events. I think it was a good bear market, but there's been some major events recently that I think, I think it's cool. I think we'll look kind of back on this period, and I think it's going to be like pretty historic.

in terms of an inflection point in Bitcoin. Why? What do you think has been sort of the key inflection point? So I think it's kind of like a few things. One, I guess like to furthest back, like the Tether audit announcement, it's not really necessarily the fact that they received that. But like, that's a big moment in the industry. There's some debate around that.

That's not really what I'll get into. But like nonetheless, big four firm is verifying the reserves of the stable coin that's like, what is it? I think, you know, they're a top 20 international owner of U.S. treasuries. And they got, they get this audit. They're operating independently internationally. And they've been buying a ton of gold in Bitcoin. And they have this, like, reserve position in gold and Bitcoin. So like, I think, one, them getting that audit and, like, taking a step towards more legitimization in the eyes of the world, that's big. Obviously, the next big thing was the Treasury announcement over the past week.

And whether you call it yield curve control, whether you call it like, the Treasury is doing its own QE, there's like technical debates around how all these things work from like a definitional standpoint. So like it doesn't really matter. What matters is that like the Treasury is earmarking. They are trying to control what the rate of interest on the long end of the curve ultimately is. and you know the market knows and is responding to that in a way that this is just going to lead to more debasement and and then Bitcoin and gold rallied immediately so like this rally in this change there's two big things with that I think you know number one this was something we talked about in the annual report this was like part of our predictions

one of the big things was the idea that like the cycles are broken or they never existed or whatever you want to think about that. And this, you know, I think you and I are on a podcast last year. You know, we're talking like, I don't think it's ever going to fall below a 50% drawdown again. And we pretty much, if this is the bottom, then we hit that, like pretty much on the dot. I think it was like slightly below 50%. But it was very close.

Yeah, very close to that number. And that means that everything's structurally changed. And that is the key insight is the market is taking a meta-analysis of the price performance of Bitcoin over this period. And now people are viewing this asset differently. And I think we can see that from the fact that, like, Michael Saylor didn't buy anything. He was selling. And not only that, but the ETF inflow that came as a response to that. this, which is, you know, showing that this is like institutional and retail buying behavior.

That's huge. It says, hey, Bitcoin's a countercyclical asset on this debasement trade. And that was a big thing that we were calling for in the annual report. I think the specific prediction we made was that it'll be obvious in 2027, but 2026 in hindsight will be the year that we view Bitcoin as like decoupling from equities and broader risk assets and being viewed more as like a, whether it debasement trade or a countercyclical hedge. So this happening, it doesn't mean it's persistent. We have a lot of time.

And that's why I said in hindsight, I think we'll look at it as the period. But I think this is the start of it. Like, that was very major. You see the news headlines and the way people are talking about Bitcoin right now. And it has a 54% bottom paired with that. So what does that mean? It's less volatile than it used to be. When people are expecting 70 to 80% to drop down.

out of the asset. So structurally, it's like, I'm an asset manager, and I want to take a lot of my capital and put it into a countercyclical hedge. Like, it's no, everybody knows how this deficit game is going. Everybody knows, you know, they want to be in hard assets like this. That's what the gold rally was driven by last year. And in a lot of what we wrote about in the annual report,

that came out in January at the beginning of this year, was a rotation of the gold market into Bitcoin. And then I think the surprise we had was this AI trade emerging that the way that it did. That kind of boomed and now it's crashing. And then here we are and people are looking at some of the alternatives. And Bitcoin has just been so compelling. I mean, I've been tweeting into the void over the past few months of like,

this is like the further up, we saw this AI trade go. And the further down we saw Bitcoin go. It's just like, oh, what a perfect, perfect opportunity to rotate out of the gains from that. So I think those three variables are kind of like setting the scene for a few trends, which I can get into, that I think change like how Bitcoin gets adopted in by who over the next, you know, over the medium to long term. I think one of the interesting things, like if you look at this in hindsight, I did a show

a checkmate a couple of weeks ago. We were talking about obviously Bitcoin price. And he was talking about this being sort of the capitulation phase. he thought he was coming to an end of the bare market. And one of the things he was looking at was like ETS were capitulating. And they essentially have just been like, they've been the retail in this last few years. And the behavior hasn't really changed from money. It was just people buying on Coinbase or wherever.

And I think that's quite interesting. They've now phomered back in as Bitcoin prices pumping, but nothing has really structurally changed. It doesn't look like. I think that the big structural thing is it is like the inherent idea that, oh, if this asset's worst case scenario is a 50% drawdown, I feel much more comfortable recommending that to clients as an asset manager. I as an individual feel much more comfortable taking a position in that.

Like, that's the huge unlock that I think comes from this, where asset managers start to just fundamentally view the asset differently. And now the idea of like, oh, maybe it's a 0% to 1% to 2% allocation. you know, if Bitcoin's worst case turned into like 30% drawdowns, then the idea of a 10 to 20% allocation and portfolios from a lot of asset managers is it's something that can be pretty acceptable. And like that's one of the big things. I think structurally that's changed from the price action. But I think it's too soon to call that though, because it works both ways. If we'd have had, if the bull market had had to, you know, 250K, we would have had way more than a 50%

pullback, most likely. And so I think by saying it's not going to go below, you know, 50% or whatever in the future means that the upsides are probably capped as well. Do you think that's right? No, no. I think like, and this was another big thing we wrote about in the end report. Like, I think, so the framework that I view this question from, like, I think everybody is like looking at historical price and cycles and being like, oh, no, we're seeing diminishing returns in the asset. What drives demand fundamentally is not necessarily that. It's a component of it because obviously the market's like taking a meta view of it. But if the market is all following that type of a narrative and they're like, oh, it has diminishing returns. I'm going to hold it.

I'm going to expect that. These are the types of like herd mentality, narrative-based crowd behaviors that happen in markets that are destined. for a surprise, you know, and the market gets surprised because something fundamentally changed, something that actually was a demand driver fundamentally in the asset changed. And I think that, you know, where that comes from, the framework I view it is I view from the adoption of Bitcoin. And what does that mean? It means people holding it for monetary functions. And like there's kind of three buckets for that, we all know. Store value, medium of exchange and as a unit of account.

The way, like the framework that we wrote about kind of like in our firm's founding philosophy and is like three major S-curve cycles for Bitcoin. And I think we're just in the first of it based on each function. So what is the huge unlock that allows Bitcoin to basically consume the store of value market? And then versus years after that, once you are a strong store of value, what makes people actually start trading it like money is a medium of exchange. And I think that those two markets are very different and they're different forms of adoption. And the difference between those markets is why stable coins have grown so much in recent years. And so I view what's happening right now is like,

okay, so what is the ideal store value asset? And that's basically what Bitcoin was designed for. It's this asset that is the scarcest commodity in the world effectively. It's something that is the only permissionless network in the world, like truly permissionless network that you can move an asset across borders. You can move billions of dollars within a matter of minutes to seconds, depending on the protocol you're using. And you can't do that. And you don't have to ask anybody for permission to do that.

And you can't be shut off from doing that, or at least not a systemic level. And that is something that I view. is incredibly valuable. Every time there's a bear market, you think about, does that fact still exist? And it does. And that's why we know

that things are going to continue. And so, like, what is it that has been limiting Bitcoin from consuming the store value market? And it's like, why have people not moved the monetary premium that exists within gold today to Bitcoin?

I think the primary reason is, one, gold is much more stable, particularly on the downside compared to Bitcoin. And the reason for that is it's much larger, it's just a larger asset, and it has much deeper liquidity. Like, a country like Russia or China can move hundreds of billions of dollars into gold

and then liquidate that position or use it in trade with another country and not move the market. And that is what Bitcoin does not have. So, I think I mentioned this before on a podcast, but like the analogy I use, it's like Bitcoin, its worst problem is that it's young. Like that's the problem.

It's a small scale asset. It's better than gold in all of these other characteristics. So it's like we're watching LeBron James when he was playing in high school. Like we know where this guy's going. He's just in high school. And that's what makes where Bitcoin's out so compelling right now. So like these recent events, Bitcoin responding to this shift in a debasement trade, that tells me the market's like perception of it is actually starting to change.

And we'll see, like I've said, you know, this takes time. It's going to take a multi-year track record of Bitcoin acting like, you know, moving on a debasement trade, acting as an inflation hedge, or at least just moving countercyclical to like equities and risk assets. But once that track record is established, then I think it's going to be very firmly set that Bitcoin is a valuable option. And then that's when I think the gold rotation really starts to happen. That's when I think people are kind of like, okay, cool. So this is like gold, but with better returns now. And plenty of other advantages, I can store it on a USB drive and control it completely myself if I so wished.

And I can move it across the world. And I can split the keys of ownership of it across the world. There's all these big ideas that start to emerge from a custodial standpoint, from a payment network standpoint, where people are like, okay, this is completely different than gold. So that's the S curve is basically like going after this store value market. And I think where we're at right now, breaking this four-year cycle narrative and showing people that this truly can be a debasement trade, that's what leaves it to the next leg up. Like, if Bitcoin is in 5 to 10 trillion market cap range, now we do start to get into that world of like, okay, from a global standpoint, this is one of the most deepest, most liquid, you know, homogenous assets that kind of exist globally.

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I can't stop thinking of this, though. I'm just going to be laughing on my screen until I show you. What is it? Every time I'm looking at you, I'm just thinking of this. It does look like straight out of confidence. with the black shirt. Yeah, you've got your Jerry curl going on. You have to put this in.

Keep this in. I'm getting a haircut soon. You really are rocking the like 90s Jerry curl right now. Yeah, no, the hair is out of control. I'm getting a haircut soon. Sorry, that was very unprofessional. How long do you think we have until Bitcoin starts taking from that gold trade? That rotation actually starts happening with what is happening right now.

So I'd say that this type of a trade persists. let's say that the Treasury continues to expand, you know, whatever sort of fiscal control that they can implement, they continue to, you know, they're going to have to continue increasing liquidity within the system. And, you know, as that expands and gold continues to move the way it does, if Bitcoin continues to do that,

then I think it's like we see very small basis point percentages of the marketing gold start to move to the bank. And they just feel it. So it's like, okay. Gold could go to 10,000. Gold could potentially go higher than that, but we could watch Bitcoin run from 80K up to 800K in that same period. And I think people are going to view the return potential.

And the riskiness of Bitcoin is valuable once they just get very comfortable this downside. So that's not a direct answer. I don't know how to like time it. But the direct way I could answer it is that if Bitcoin maintains a consistent track record, of over a year, I think, of countercyclical behavior, or at least, you know, it reacts positively to monetary or fiscal expansion, then I think that it will earn its place in the minds of people as a viable trade for that. This is essentially a bet that governments keep printing money, which is a pretty safe bet.

And the thing that the Treasury are doing right now, I know that there's people that are saying this is not yield curve control, but it certainly looks like it. Like, do you think it is? I think the definition of yield curve control is something along the lines of one, the Fed is implementing it, too. There's a set mandated policy of rates across a term structure that they're going to be adhering to. and in the same way that the inflation rate is a target policy rate that the Fed announcing something like that would definitely make it yield care control. I think that similar to during the pandemic when people are like, oh, no, this is QE, and other people like, well, it's not QE. Like QE, technically speaking, and these are just like technical nuances that don't really matter. But like QE was Bernanke trying to ultimately lower the long end

of interest rates during the financial crisis. And it was really like most monetary policy up until that point was focused on shorter duration, treasury assets and, yeah, treasury assets. And then that's what changed under the Bananke regime, was like, okay, we're gonna go out to the long end now.

And that was what kind of like defined it is QE. So there were, I think one of the other things, too, on the fiscal side is, like, the Fed can expand its balance sheet when it conducts it. This is why it's kind of a Fed thing because they can create the money. The Treasury can really only, like, transform the duration that they own. So, like, where does the money come from if they're buying long-end bonds, whether it's in the open market or from the Fed? the money comes from other debt that they issue, right? So, like, they have to go issue bills,

short of maturity debt, to buy these longer-term bonds out of the market. And then the argument would be, well, what about the Treasury General account that Besson announced whatever it was a day or two ago that they're going to be using of, like, a trillion dollars in it? And that account is, primarily financed by the, you know, issuance of bills.

So it's kind of like basically saying the same thing, despite it truly being like an actual cash reserve account right now. So like that's a little bit more of an argument for it. But it's not, you know, on the run new issuance type bills that are being used. But historically issued bills are being used because there's cash in that account. So I don't know. It doesn't really matter. What matters?

It sounds like semantics. Like, if it's going to behave like Yil-Cof- Do you just treat it as that? It's just endgame type shit. Like, that's what they're doing. It's just like, okay, we're desperate. And here's what I'm surprised isn't being talked about more. Like, I think that this is an argument for Fed independence more than anything,

the way that Warsh has been behaving the fact that, you know, the Treasury's had to step in with this type of behavior because the Fed actually isn't doing it. I'm surprised that's not being talked about as much because that's kind of like the key thing. I'm, that's like the most noticeable, unexpected thing to me from how this is gone. So, yeah, but yeah, it's just like semantics that's happening. And the reality is, is whether or not the Fed does something fiscal dominance, you know, nothing stops us trained, blah, blah, blah, is going to persist.

And the only thing, and it was Druck and Miller in the Wall Street Journal article op-ed that he wrote today, you know, he was making the point that, well, pretty much the only option we have here is to cut deficit spending. So, because this isn't going to work. And that's kind of what we saw, right? Like, we'll see where it comes. We'll see what other, you know, the word toolkit is being used a lot more in headlines again. So toolkit means number go up, usually when that's coming up in headlines. But, you know, they're talking about other tools in their toolkit that the Treasury now has.

And we'll see what they do to ultimately get markets to react. But, you know, after the initial announcement, it doesn't seem like what is the current 10 and 2030 at right now. But it seemed like I think after the announcement, the market still kept selling off. And they fully reverted. Okay, so they're down a bit. Okay, the market is starting to kind of yields are down a little bit. But from the first announcement, it had reversed. And it wasn't until they started, you know, expanding on the idea that, I guess, markets have finally come down.

So the question is like, how effective can they ultimately be in the belief that they can tame some of this. So one of the things that I think is quite interesting about it, like whenever I speak to Larry Lepard or someone who's, you know, into the debt spiral type situation. Yeah. Like Larry said to me before, yield curve control will come. They won't call it yield curve control. Like, seems like a pretty good call. And the thing that I'm trying to understand now is, is this the start of just a bigger easing cycle? Like, is this just the first thing they're going to do?

And is this going to continue for, you know, multiple months, years, however long? That's kind of a good segue into one of the areas that I am curious to see how much this starts to expand. And that's like how much the Treasury starts pushing on. stable coin adoption. Like the framework that I use to think about all of this is you have an asset, you have demand for an asset for certain reasons. When you think about that with like dollars or treasuries, there's a market. There's a market for people who are demanding these bills and bonds, etc. And there's a market for the currency ultimately. The expansion, the expansion, of that is tied between the two,

one backs the other. So the expansion of dollar dominance necessitates demand for more of the reserve, which is the debt. And so it's like, okay, what percentage of the global market of dollars exist?

Or of dollar demand exists today. And, you know, I haven't looked at the numbers recently, but, like, we're kind of sitting in this realm of, like, we're the most dominant and, you know, the euro is kind of like the next most dominant, and then there's just much more long-tail group of currencies around the world. That's been declining. Like I was writing about this years ago.

I think, like, the first major highlight on that was the 2021 when we cut Russia off from Swift, and people started to focus on this, like, fragmented system. And like we're seeing that more with what Besson's been announcing recently in terms of anybody who's doing work with Iran, the economic sanctions that they're going to be subject to it. So, like, that's all, like, the primary narratives at these points in time is that the global currency order is fracturing, people are trusting, whether it's the U.S. payment system, Swift, or whether it's the dollar currency itself, they're trusting the adoption or they're trusting. that less. And they're moving to alternatives. And that's primarily either other countries or commodity-based assets and looking to alternatives for payment networks. And like Bitcoin's been a part of that story. So there's a fracturing of the system that's been going on across all of this. And, you know, looping that back to the question, the question's like, what surprises us on

dollar demand is if there's some new vector of demand. And that is what makes stable coins so appealing. And that's where the interests, I think, are aligned with the Treasury. Because they're like, okay, how do we get more people to own our debt? And it's like, you know, current forecast, stable coins is a few hundred billion dollar market size. Current forecast that you see across most is like by 2030, you know, not that far off. we are going to see, you know, a few trillion in market size around stable coins. And that's either, I think that's for like two primary reasons.

Countries and people that want access to a relatively less inflationary currency than they have domestically. And, you know, the hyperinflationary global South economies are like the primary adopters of that. And then there's also, so like that's one source of demand. And then I think there's also another source of demand for actual payment settlement. And that's the piece that I think is very bullish for Bitcoin over the long term from stablecoin adoption, is that being able to move value over a protocol based on digital signatures is just something that for any, you know, I think about it in terms of like, what are the businesses, what are the applications, what's a soft? that's ultimately using this around the world.

If, you know, 30 to 40% of payment volume is done in stable coins in a decade, then 30 to 4% of payment volumes is a button switch away from being done in, you know, Bitcoin directly. And so like getting the world to use digital signatures for payments is a big thing. And I think that, and I think that that's bullish to like get the infrastructure set up for like a Bitcoinized world. So those two things. If those expand, then the Treasury is kind of like, okay, so every stable coin issuer, if they grow into the trillions, and let's say a decade from now, you know, the market grows the 10 trillion.

It's like, you know, total public or total U.S. debts at like 40 trillion. And I think in terms of like Treasury, it's around like 30. So if we think about stable coin providers being, you know, five to 10 trillion in market size over the next decade, like, that's huge in terms of demand for treasury debt. And so I think that, like, that this is one area that I'm curious to see how the Treasury starts reacting to that, and how this ultimately is going to get pushed at a global level. And, yeah, so, like,

that is what offsets the idea of people being like, okay, we're going to go into a debt spiral. What is that? People don't want to own the debt anymore. So it goes down in value, and that leads to debasement over time and the currency. The currency is the escape valve, and that leads to inflation, and economies can crumble from that. So the question's like, how do we increase the demand for a period of time

so it doesn't happen? And this could be one vector, or one of the areas that they start to pull on, is like the inefficiencies of the international banking system in trying to capture the long tail of other people, of other currencies and converting them to dollars, I would guess that they start leaning into that pretty heavily over the next decade. And then I think there's a big story for Bitcoin adoption around that.

At the start of the show, you talked about the three function of money, store value, minimum exchange and unit account. Do you think Bitcoin's failed if it doesn't eventually become all three? I don't view it as binary. I view it as a spectrum. I think that, like I wouldn't say it failed. At the end of the day, I think that if we have, let's say Bitcoin takes a market of gold, did it achieve the full potential we believe no

do we have a permissionless store of value asset that we can ultimately move across borders and outside of the control of government yes and we can do that in large quantities how does that impact the incentives of governments how does that impact property rights being protected by the individual I think significantly much more than people storing their value in real estate

much more than gold so like that's a win. I think it's a win for freedom. But I do think that that vision pales in comparison to the idea of the world being on the first neutral monetary system in history at a global level. Like historically, if we go back to primitive times when people use commodity-based monies, non-government commodity-based monies,

you know, those were neutral. They were subject to some degree of like marketing. influence in the supply and demand because they had utility other than being money. But generally speaking, and certainly relative to fiat currency, they were very neutral systems, but they weren't global. They were neutral within their own, you know. Prior to precious metals, monies were largely confined to like the geography in the economy that they were in.

Precious metals started to like, you know, cross borders and power structures. and a lot of people were using gold and silver generally. But we just really didn't have, like, an integrated global economy. Like, when I think about the Bitcoin Maximilist type framework, or not even that, but just like, I guess a general, I don't want to call it Austrian, but whatever it is, the viewpoint of like money converges towards one, it's like true from like an idealized perspective.

Like philosophically, it's true. That's the optimal way that things go. The reality is we've never seen that. That's never existed. And that's never existed because... Did you not see that with gold, though, like pre-feat currency? Yeah, but gold was something that it wasn't global. There was also a bimetallic system.

So because gold wasn't good at something and silver was a little bit better at some other things. And these weren't global. systems, like we're thinking about what they ultimately were in, like, European economies at those points in time. And, like, there was a whole other thing happening, like, in the East during these periods. And I'm no expert on, like, development of money within the Orient. But I think the timelines were actually very different for how some of the evolution was happening between these. But, but, like, it's, you know, it gets, it gets close. And I think that the reason that we start, But the reason that those things didn't happen,

or at least weren't, didn't grow to a global level and persist for a significant period of time is that we quickly started to see more. Well, I won't say that. They did persist for significant periods of time. But even if we assume like a biometallic system is like one, we ultimately had the evolution into paper systems because paper had superior properties

to gold from like a payment standpoint and a bunch of other reasons, but that's another topic. So like, and then that got very fractured. And like, you know, generally speaking, I think across history, what I was writing about my book is what, like the primary reasons

that we don't see like one money is because of one, information, opacity, people just like not being aware of everybody else's money around the world. That's probably largely gone with the internet today. Like sovereign coercion, amongst governments. That's probably the number one reason we don't have one currency today. And then just like monetary utility trade-off. So one money being better than another at some things.

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That's Bitkey. Dot world and use the code WBD. But like I think we'll get to a world that will be like very much like either Pareto rule, if not more exposure to one specific commodity. And I think that world of like Bitcoin being like the neutral first global neutral monetary system, you know, highly dominant where like, 90% of trade is being done with this neutral system. That's something where it just changes the incentives

and the power structures of any government. And that is what I think unlocks, you know, the memes of like the future where everything's perfect and the cars are flying and all this stuff. And I think having the neutral monetary system is that. I don't think we quite get that from a permissionless store of value. But it's a good step. So that's why we got to fight. I think that we have to build a lot more infrastructure.

I think stable coins are doing a lot of that effort for us from an adoption standpoint of infrastructure. I think that there's a lot more. The way that we view this as a firm is Bitcoin needs to be in everything. Like there's all these markets of different monies, of store values, of things, and everything needs to become Bitcoin compatible. It needs to be an arm's length from that. Like, from us as a firm, when we think about do we want to invest in something that's like in its own little Bitcoin world that nobody uses, it's like, no, like the battle is being fought where capital is today and where people are storing their value. So things like, you know, the ETF is a great example of this.

The ETF got a bunch of people who are in brokerage accounts to get direct access within these like tax advantage situations to Bitcoin. So boom, there's a bunch of capital that moved into it. Thousands of other areas like that within the financial economy globally. We need more and more like software, financial products, banks. We need all these different financial institutions that just Bitcoin needs to go everywhere. And it is. It's been growing significantly throughout all of that. But that's the stage we're in right now for adoption is like,

let's like make the world Bitcoin compatible. And then we get to a world where now the capital can enter the system. Now the capital at least can get exposure. And then people can be like, oh, well, what if we control us ourselves? Oh, what if we're moving everything over lightning? Oh, what if I actually want to like store my own keys as an institution? I think all these things are very far out. But it all starts with going to where people are.

meeting the, you know, ultimately the consumer where they are. So I asked you to come on the show and you put a tweet out. I'm going to read it. He said, Treasury pushes stablecoin adoption, stable coins expand dollar dominance, long tail of smaller currencies dollarize, Bitcoin expands a stable coin reserve asset, stable coins Bitcoinize, fiat currencies capitulate hyper-bitconization. That's like your playbook. I was feeling it when I tweeted that. I mean, I like it.

But the thing, so I... I want to believe in the hyper-bitconization story, but I've always struggled to sort of see the sort of the route that we take to get there. How likely do you think hyperbictorization is as a concept? From what I'm seeing, so I'll explain my thinking. I'm not worried about the incentives of Bitcoin adoption. I think that those exist. I think the worry comes down to

and what a lot of people focus on is what stops or what constraints ultimately emerge in that process. So like I just use the ETFs as an example. That's, I think at least amongst like Bitcoiners, that is one of the concerns. So like, okay, well, the more and more

that Bitcoin is ultimately custodied in a concentrated area, and the ETS could be a vector for that, the more risk there is to the network being controllable, no longer decentralized. And I think, like, that's, I've never gotten, I think, a reasonable answer from anybody who's hypercritical. That maybe you have. Like, I haven't gotten a reasonable answer on it. But, like, I'm like, okay, what's a number Like, what's the percentage of Bitcoin that needs to be in one custodian for the network to no longer work? Or you could ask it the other way, like, what's the percentage of Bitcoin that needs to be in self-custody? And then define what that means.

Like, self-custody is a gray area. It's a vague term. But what's that percentage? And I don't think anybody necessarily has a clear view. I think the way that I view it is, I wrote about this in my writing on free banking. And like super quick, free banks, there were systems where that ultimately, like, the banks were acting, generally speaking, in the interests of consumers, and they were highly competitive.

And these were systems where a central bank doesn't exist. It just banks were like you, and they worked because you put the gold in, you don't want to trade the gold. It's way easier to trade paper. you trust the bank with it. The bank gives you a receipt on their paper. And then a bunch of banks were all doing that, and they basically created their own private currencies that were all competing with one another.

That competition amongst all of the banks to have a currency that was the most pristine was a really powerful incentive. And these banks ultimately serve the general public pretty well. Every time there was a bankruptcy of a bank from doing like a fractional reserve behavior, they got bought by a competitor and the customers very, very, very rarely

over a period of like over a century lost any sort of money. It was only on like the equity holders of the bank. So the like that view of banking is interesting. And it's just like, okay, well, why doesn't that exist? And it doesn't exist because governments would take control of those systems. It was very rare in history to see like a truly open free banking system. There were like two basically. So it's like, okay, how do we manufacture that set of incentives?

What's interesting is that at that period of time, it was so much less practical to operate outside of those types of systems. To like say, oh, I'm going to get my gold out and I'm just going to trade gold with everybody. You could do it, but it was much less practical. It was hard to exit the system, basically. And that is an incentive that I think is really important. Having the ability to leave the system gives service providers

that you are trusting within a system of very different set of constraints. It's not that, oh, they may move to one of my competitors. It's like, oh, they may just not even use our entire system in the first place. Having an alternative way to opt out is a powerful incentive to those who are opting in. And that is what I think is really valuable about how Bitcoin works. In a world of like trusted custodians, like Bitcoin far in a way, the marginal cost of being able to self-custody and participate in those economies is just like, so so much far, far less than anything else, like try to exit the banking system today and

operate in a modern economy. It's, it wasn't possible unless you wanted to be like a drug dealer operating in cash. And I mean, that was going to be my point. When you said, like, if I don't know if I've heard a good answer to that is I don't think it's really about the percentage, although like I don't really want to see any individual have or any individual institution have more than like, I don't know, 10% seems like a lot. I mean, if you asked me 10 years, if I, if I, years ago, whatever, 5% or 4% or whatever strategies, that seems a lot. And it's not that I love to see that. But I think the only really important thing is the ability to self-custody and move Bitcoin outside of any controlled system. That's the only really important thing. Exactly. So, like,

as long as you have that incentive, and even if it's a minority of the market that's in self-custody, I think that makes a service providers act in your interest. And it's like, okay, well, what if the government tries to take control of one of those? And it's like, well, the remaining capital in the system is going to flow out. So it kind of puts the government, until I could catch 22 in those situations. And, like, that's what's important is the marginal cost for an individual to operate in a self-sovereign way is low enough.

And I think it is. So, like, that is not something I'm really worried about from, like, an incentive standpoint. I think another thing, too, is, let's take a step back. This system is so infant for what we're planning. like anybody who's done their research on bitcoin knows that the adoption for something like this is going to take decades to get to this like neutral monetary system type vision we're witnessing the you know monetization of a new commodity that's going to take a long time for people to understand

and trust and and i think like i like i view it as its own economy and if you study um it's like this new economy that's emerging and if you study like uh economic development and how economies like grow from their instantiation to maturity, there's like a period where the concentration of wealth increases drastically and then starts to diminish over time. And I think it's measured by something, a genie coefficient, if you look those up, but it's a measure of wealth concentration and economies.

And that's what I think is happening within Bitcoin as well, as we're going to see concentration during periods. But the reality is, the bigger it gets, the harder it becomes for people to control it individually. And the more that people like, you know, who are taking large positions like the Michael sailors of the world, the bigger it gets, the greater their incentive to distribute more of it. Like, this is how economies grow.

So that's another reason. It's not necessarily something I'm worried about. And unless somebody has like a precise argument to make about a particular form of concentration in the near term, then it's not something that I'm like terribly concerned Because those incentives all kind of line up to me. And we see that distribution. Every time Bitcoin price ropes, OGs come out and start selling Bitcoin. Like the guy last year who sold 80,000 Bitcoin at the top, like, as hard as that is for

the market to digest, like, it still is a good thing. It moves Bitcoin into... Taylor's selling Bitcoin. Like, you know, it's, yeah, it's just, you can't eat Bitcoin. So you don't have to worry about people hoarding it till the end of time and trying to undermine the validity of their own wealth in Satoshi's words. but I kind of sidetracked it. I want to know how likely you think it is.

You said you weren't worried about the incentives, but how likely do you think it is? We kind of just described like, could Bitcoin be killed from some of this stuff? And that I view is very, very low likelihood. It's not really the question I look at as much as can Bitcoin grow into something less optimal than what it could be.

And that means can Bitcoin grow and to be something less than like, you know, a medium exchange in your account? And I think people have talked about this a pretty, you know, decent amount of like it just getting stuck at digital gold. I think that what a lot of that boils down to over the long run, to the point I was making earlier, if we consume the store value market, now it's like, okay, medium exchange is on the table. Now this thing's big enough to like everybody's a lot of people are going to own it at that point. Your mom and your uncle and your grandma might all have it. And it's like, okay, cool. There's this other system. You can actually use this and you can just pay me directly in Bitcoin.

And then it was like, whoa. Oh my gosh, it was so fast. And like there's like that world is I think a ways away. But the amount of infrastructure, and this goes to my point of like, everything needs to be made Bitcoin compatible. So, like, that is another question. Like, that's us as, like, being in venture capital are focusing on that. And that is a hard problem to solve. So, like, in the world of venture capital or in the world of, like, private capital focusing

on this stuff, you don't hear about DECs like ours. Like, this is very niche. You're basically playing in FinTech is what we do. And we're investing in, like, FinTech companies. and we're saying, how do we have an angle of Bitcoin adoption and how is that going to be a competitive advantage? And that world is focused on AI and stablecoins. So it's one, I think that's kind of like what VCs are doing

is like we're kind of the boots on the ground, like fighting the narrative in those realms, basically saying like, don't overlook Bitcoin. Because here's what you can go do. You can go compete on a bunch of stable coin deals. and that's where a ton of capital is going. And there's a bunch of people competing over the similar territory. But what makes you different?

And I think what makes you different is, like, support stable coins. Stable coins are valuable. Your customers want them. But what if you have in a Bitcoin angle that nobody else has? And, like, that's one of our key theses that we were writing about last year is, like, ultimately, like, bank adoption and financial institutions, that I think one of the largest growing areas within the economy, is going to be Bitcoin collateralized lending.

There's just a ton of bottlenecks within the, like, thin tech world and banking infrastructure to that ultimately happening. From a regulatory standpoint, from a technical standpoint, from just like an understanding standpoint. And so, like, that's kind of what we're working on is how we resolve that. And I think that, like, sure, you could use stable coins and get more customers because you have your stable coin compatible. But if you're a bank and you, like all the, the viability of a bank on their lending business

is pretty much just what's their net interest margin, how much do they make on their loans versus what's their cost of capital. And the Bitcoin lending market is just like, I think this huge arbitrage within that because the collateral is mispressed. Like you go talk to these guys who are running community banks. I mean, they don't even know what as stable coin is. And like, they're just like, that's spooky and like not a lot of our clients want to do it. But there's like mismatches that you see in the market everywhere.

And it's just like, dude, if you guys just did Bitcoin loans and you can literally pull the collateral over a weekend and it's a multi-trillion dollar asset and you can keep the collateral and escrow, you can't do that with the house, you got to go foreclose on it. Like, you know, there's all these reasons that Bitcoin is just superior collateral to anything else. And you don't know the price of the house. Yeah. And you don't even know it's an ill liquid asset. And like in the transaction costs are so high. like, you know, the operating cost of like running a foreclosure business on that stuff is expensive. And it doesn't mean that these aren't valuable markets to be playing in.

But like then the rates that you're getting are significantly less than what you would get on a Bitcoin loan. And so it's like you could double your net interest margin as a bank from like having like a very heavy focus on money against collateral like this. In mind you, like a lot of this discussion isn't just in like the U.S. I think that because of regulatory environments, there's such a valuable opportunity for like international regimes to be first movers in these areas. But so, you know, it's a lot of things like that

where it's like, I think to the Bitcoins, and if you read, you know, Ben Hunt's Epsilon theory piece on like the Eye of Soren and, you know, Bitcoin ultimately being co-opted by Wall Street. I don't think he's, like, wrong about that. I think we're going to see a ton of, crap narratives and everything emerged. But to the conversation we're having earlier,

I don't think that destroys Bitcoin. And I think there's a period of growth where it being implemented within the infrastructure is how it grows and ultimately creates the environment to get people out of that system and into a new system. But the reality is, if you understand the financial system, we don't have that new system yet. Like, there's so much that needs to be built for that to work.

So there's nothing to bring them to other than like, you know, self-custodying their Bitcoin. But guess what? Like, we need wealth management. We need financial products. You know, we need insurance. We need, and there's all these companies working on things like this right now, but we're still a decade away from all that happening. So, yeah, I don't know. I'm just kind of rambling about it. It'll take some time. I think that all needs to get built. And that is going to be a very, that's going to take a long time. There's people. We need a lot of intelligent entrepreneurs

to be convinced of this thesis. Because entrepreneurs are ultimately, like, the top-notch guys who are intelligent, hardworking, and love taking on a ton of risk. Like, those guys are going after AI and stable coins because valuations and capital are being attracted towards that. So we need entrepreneurs that are highly capable. It doesn't matter if you just love Bitcoin.

You have to be good at things. So, like, we need that thesis to be more well understood. That'll get easier over time. This is why price going up matters, because that's what's going to attract those people, and that's what's going to track the investment. I want to go through the rest of this, because we've gone through a lot here. Treasury pushes stablecoin adoption was point number one you made. We've talked about that.

That makes sense. Stable coins expand dollar dominance. Yeah, long tail of smaller currencies, dollar iris, again, makes total sense. Like if you're some tiny country and your population are moving towards stablecoins, like you don't even have a choice in the matter at some point. Bitcoin expands as a stable coin reserve asset. Why will that happen? So we covered the discussion earlier and to just like quickly reiterate, you know,

I think there's a strong chance the Treasury starts to push heavily on international stable coin adoption to proliferate dollar dominance global. And so the question becomes, Like, I think if you start to think about like, okay, well, how's that market going to develop? With the Genius Act last year in the U.S., we got like a pretty clear view of what's going to happen with stable coins in the U.S. And it's basically like Tether can operate out here with their international stable coin if they were to ever pay interest and with how their current like reserves set up works. So the Genius Act was basically like, you guys have to use U.S. government treasuries as your collateral short duration. And like the term is a narrow bank.

You're very narrowly defined by what you can do. You heard David Sachs talk about why they didn't allow interest in you? I don't think so, no. So he said on the All In podcast just after that bill went through that they can't do interest on stable coins because they basically just got so much push. back from smaller community banks so that they sort of bowed to the banking lobby and just said no interest. Because I guess the banks seem to write on the wall. Overarching community banking, I remember when that letter was sent, their organization sent something to the lobbyist groups and the universe look like, you pass something like this, like, we're going to be out

of business. And I think when you understand the community banking market, like, the community banks aren't the bad guys. The community banks are very behind. They don't know what the hell is going on in the world. But like the bad guys are the bolds bracket banks on Wall Street, you know, the major ones, the JP Morgan's of the world, all that. These are the guys that they're not just trying to bully, you know, Bitcoin or the crypto world. They're bullying all of their competitors as well. They kind of created the sort of club at the top and they get to extract a lot of wealth and have influence over the system. Community banks are the guys who are just getting like screwed who are serving rural communities.

And those aren't the guy, we want to modernize those guys. Like, we want those guys to ultimately win and be the early movers. They just can't help themselves from like the, what I've seen on some of that. And, but, you know, putting that aside, like the, like, when we think about the banking system, right, in this question of like paying interest, you know, I think like the consensus this conventional belief, I guess. Like, treasuries come into our banking system. They pay a rate of interest.

That ultimately turns into all the way down the stream of intermediaries, a bank account that you get and you don't get any of the interest on it. So that float that they get from those treasury securities is basically consumed by the system itself because it's so inefficient. So any sort of system that ultimately passes. like a direct yield of treasuries on a consumer. I think that, you know, those are attacked by banks because their model is own the government

so that we can create an inefficient system that allows us to extract that margin for ourselves and not pass it along to the consumer. And, you know, like what stable coins are doing is they go direct to treasury bills. Technically speaking, you know, they go through brokerages or something, But, like, they, uh, nonetheless, they get treasury bills in their reserves.

And if they, you know, if it was legal in the U.S., very strong argument that stable coin issues could just directly be passing that on to consumers. The way it works is like in the U.S. was Circle today. What they're doing and what the Clarity Act battle is primarily over is circle doesn't matter. They're just kind of almost like an arm of Coinbase. What matters is distribution. Coinbase owns that within the U.S. So they have an agreement where like 60% of that float is going to Coinbase.

And then Coinbase is like passing some of that along to their customer basis like incentives. And then the bank's like, that's you guys paying interest directly. And you're not allowed to do that because we need to protect our senior age within the system. And so like that that's kind of the whole battle happening in the US. But nonetheless, like if we take a step back from like getting into like the granularities of the regulatory on all of it, The question's like, you know, the yield finds away, right? Like, people want to get access to it. And I think that the times this has happened before, like when money market accounts first

started to emerge and there was a similar pushback from the bank lobby that this is, you know, this is going to destroy the banking system. It's going to draw deposits out into these money market accounts. The reality wasn't really the case of that, but like also money market accounts aren't money. Like you can't trade them peer to peer. You can do that with stable coins. and that just changes the game,

because now it's like, what's the, here's kind of an interesting way to think about it. It gets confusing when you think about the monetary system, the difference between like a US dollar and a treasury security ultimately, because they're so tied together, because one backs the other. And it's just like, well, the question's like,

why don't we just trade treasury bills directly? And the reality is because they're not homogenous. They're not like for like. There's no fungibility across them. They have different mature. They have different interest rates, they have different duration. Like, there's all these different characteristics to where basically having a combination of all these things put into an account and then issuing a currency on top of that, it makes, it like

blends them into a homogenous thing. And then that currency is trading in a global market. And so, like, that's basically the value at, I think, of like the transformation of debt into a currency. And stable coins can do that really perfectly. So going back to the beginning of the question, I think what's really interesting about that is like, right now we just have Tether competing globally,

and they're so dominant, and you have Circle in the US because they're playing this regulatory arbitrage game. But Tether is like, what's cool about Tether is just like, you know, one, it's got the scale from the first mover advantage. It's much more liquid. It's more widely accepted. It's, you know, been used in a bunch of different exchange

changes, et cetera. Nothing that can't really be solved by a competitor over a long enough time horizon. What's cool about Tether, though, is their neutrality and the way that they've kind of avoided this, like, let's make a specific bet on a specific economy, to a degree, at least, with, like, their primary issuance. And that's cool, because that, like, really makes them different.

And because of that, Tether has, you know, whatever it is, somewhere in the range of, like, I think, 150, 200 billion AUM on the amount of like USDT outstanding. And they have like an excess amount of reserves on that. So they have technically like treasuries that are backing slightly more than that

amount. And then they also have like 20 billion in gold and Bitcoin in excess of that, which is not small. That's like a pretty significant position. And they continue to like load up on it. They bought a bunch of gold this year. And so like what they're doing, like pretty based. Like I think when you think about it, like I'm working on some of this stuff as a writing,

which if I can get it done in time, I'll try to do before we put this episode out. But it's like there's like a, you know, like a lot of this audience is probably familiar with a carry trade and there's a bunch of different forms of it. And the stable coin, a stable coin is a carry trade effectively. But it's so great because the, it's like the, only carry trade were on the leg where you're buying your cost of capital at zero.

Like Tether has the zero cost of capital leg in their carry trade. And then they collect the float on everything else that they get in terms of securities on the back end. So the question becomes we have this setup where there's kind of like the stable coin carry trade happening. There's a long tail of stable coins that are starting to enter the market. And the question is like, how does this grow over time? If the U.S. Treasury is pushing this dominance, how is it going to grow? It's going to be a lot more fragmented. If you look at like dollar mutual funds, those fragmented pretty significantly over time.

So, like, you know, you could argue that we're going to start to see a lot more. But then it's like, how did these guys differentiate? I think, like, one thing that's kind of thought about in the market is like, you know, there's like ancillary incentives where a lot of these stable coins are basically trying to combine the idea of their own dollar payment in their company and a loyalty system. So there's like some angles like that, but I think the primary thing that they're going to differentiate off of is yield. They're going to say, okay, they're going to do what Circle's doing.

Circle is just test to use Coinbase for distribution, but Circle's passing along 60% of the flow that it gets on its reserves to ultimately get adoption by exchanges and get consumers to use it. So we're basically just kind of like recreating. the banking system by having a distribution arm that cuts into that yield again to some degree. And I think in an international level, we're going to see a lot more like direct rewards or direct yield that starts coming. And as we start to see that yield, then we're going to have some spectrum of stable coins

where some are going to see like we're just going to own like maybe like a narrow bank. We're going to have only, you know, treasury securities or whatnot. We're going to pass that interest on directly. And then we're going to have a bunch of high. high risk-seeking type providers. They're going to be like, no, we're going to get very high return assets, and we're going to double or triple the interest rate that you can get on something and, you know, see if we can sustain that through redemptions.

And that'll be like this, you know, potentially like international free banking arm of like stable coins that emerges. So I think if we get fragmented, we're going to see incentives that are going to draw a system like that. The gut reaction to that is a lot of them are going to fail if they're trying to do that. But what I don't quite understand is stablecoins, Bitcoin eyes, like I understand. So obviously, Tether have done Tethered gold, and I understand why you need a stablecoin version of that, like something backed by gold because it like gold can't move on digital rails. But stablecoins, Bitcoinizing, is that not just Bitcoin?

I think not. So it's a spectrum, right? So the point I was making about how like a stable coin is blending treasury security issuance. So what about the stable coin that has 5% of its total reserves in Bitcoin? Which I think Tether used to have about that. Exactly. Yeah. And like these things will have in flow.

overtime. But like, if we think about our fractional reserve systems used to exist, like, in free banking, like competitive markets where it was like, what was the amount of fractional reserve that you needed to ultimately, like, meet dollar or, you know, not dollar, the domestic currency's redemption. So, like, in Scotland, that number came out to, like, between it ranged 20 to 30 percent of the total amount of outstanding liabilities they had in receipts. So think about it from that perspective. What if there was a world where something like a tether had 20 to 30 percent dollar denominated liquid assets and the remaining 70 percent was Bitcoin?

What could they do with that? Who's going to have an advantage like that? And maybe I think the irony of a system like that is fractional reserve can end up becoming something that's very good for Bitcoin. I've never liked the idea of like Bitcoin is hating on fractional reserve banking. I understand that like the current fractional reserve banking system that we live under has so many flaws. But in a free banking system, if you're entering into an agreement where you understand that it's fractionly reserved, and I don't have any problem with that.

I have no problem with free market incentives competing. I've always believed, like, free banking, free banking was something that was created by a natural free market. So, like, if your opinion's different than that, then, like, I don't know, you're an idiot. I don't really care. But, like, I believe in free markets. I don't think that anybody's more intelligent from, like, what's, those were ultimately born from. But yeah, the system that we have today is not that. It is not anything but is it's the worst fiat system in the world. But like a world where we have free banking existing again or something within Bitcoin, if that's what the market demands, that's what the market demands. If the market demands for actual reserve and that this gets into the more like

elasticity of money type arguments and this like vague theoretical economist crap. But like If you get into that stuff, there's, I think the answer is literally like, what does the market create? I would argue that like, though the market created in free banks a fractional reserve system naturally, through a large percentage was of like some of the like inefficiencies in the system. Maybe it would have been higher if they weren't as efficient. And also if the system had a competing exit route, like a big. Bitcoin option, then that would have changed the incentives of the system. So, like, I think the way it would work in, like, a Bitcoin world could be very different. But, like, yeah, I agree.

If the market demands it, so be it. And as long as information is, you know, granted to people on how it's operating, then that's fine. So the Stable Coins Bitcoin eyes part of this tweet could almost be replaced with return to free banking. Yeah. I think that if people, like, like, let's bring this back. to the beginning. If the 50% bottom in how that changes the percentage perception of the asset, and then that is something that can ultimately lead to a much greater scale, which creates more liquidity for the asset, and that makes it much more competitive with something like gold.

Like, if we were to think about gold as a reserve asset in a lot of these and like what Tether's been ultimately doing with their excess reserves, there's no reason that couldn't expand in their reserve system today. And I think that like that, it is those little things that if, you know, stable coins were left to their own devices and they didn't have to worry about regulatory arbitrage and compliance, etc., that we would, really what we're saying is treasuries need to compete with other forms of money in global dominance. And the reserves of something like this market is going to be the canary in the coal mine for where that's all. ultimately going. And if we know how money works, then we know that Bitcoin is going to be the most dominant reserve relative to treasuries within a market like that. And then we should expect it to see to gradually consume that market as it gets bigger and bigger and more liquid.

That makes sense. So essentially what that's saying is like that stable coins, Bitcoin eyes, free banking comes back. The amount of Bitcoin held in reserves by these stable coins might start at 5%, but the free market trend you're expecting to go to eventually 100%, which is when you just hit Bitcoinization, fiat currencies cannot compete against that, and we'll drive flying cars. Yeah, exactly. Like I just think Bitcoin's valuable money that this is a vector through which the adoption could ultimately happen significantly. And the funny part about it is this, this is a vector that the US government is probably

going to be trying to expand significantly over the coming decade. And so it's just, I think it's like a perfect. thing for us to be pushing for global adoption of Bitcoin through. And yeah, and like, that's, that's huge. So, like, if I were, if you were to ask me, like, what, what is a better option for, like, spreading Bitcoin? All the options we have to spread Bitcoin adoption today are things that are in independent regimes.

And we don't have a lot of, like, like, I guess, centralized forces that are pushing their adoption. And all of them are too premature to get Bitcoin to be used as money. This is like El Salvador mandating people have to accept Bitcoin as payment. Right. Because nobody wants to use it as payment today because it's terrible for that. Like not, it's terrible in terms of it. It's just going to move up and down in price. And like they literally launched it, you know, for certain merchants to use it. And then it dropped like 70% within like a year after that. And like people hate it down there because of that. Like they're not a expected to know this stuff, and they don't really give a shit. And they don't have the luxury of

losing capital like that either. But this is like the free market mechanic that can move us to hyper-ocrinization. It allows it to gradually exist in a monetary form. I like this framework, man. Yeah. I think that like it can gradually get to, it allows it to be 10% of your exposure to 30% to whatever it becomes over time. And the incentives align to where if you believe the compound annual growth rate of Bitcoin is going to be. be 30, 40, 50, whatever percent a year, then it's going to be the number one way for you to add yield to the ultimate, you know, Stimcoin that you're providing and competing in a market on. So, like, if yield starts to proliferate, Bitcoin's the best reserve asset to start adding

that. And I think we'll see more and more small degrees of it in the long tail of the market. And that that could be the way Bitcoin really starts to expand over time. I love it, man. That's cool. I think that's my favorite framework I've heard for hype Bitcoin. That's because I'm your favorite guest. Fair. All right, just to close out, I want to know, at the start of the year you did some predictions 2026. How many of them have hit?

What are you waiting on? We have a lot of time left in this year, is the first thing I want to say. That sounds like Coke. So I don't even want to go through them yet. Do we have to do this? Yeah, come on. Just tell me if you live here. You don't have to. We've got time.

The rest might hit still. Okay, okay. I haven't given it a full scan. Let me pull it up really quick. I mean, you're never going to get them all right. Well, I know that. I guess gun to my head when we were writing these, I was hoping for like 30 to 40% hit rate, I think.

The big one that we got so close on was the strike acquisition, because that was a very precise call. See, I think you can almost count that as a win because it was like it was going to happen, and then it didn't. Oh, for sure. I mean, we were thinking about it. And, um, but that, that seemed to make a lot of sense to me.

Okay, so Bitcoin's got to get to 150K this year. I've been definitely off on that. Year's not over. Ron, it's not over. I think that to what we're talking to our second prediction, Bitcoin, begins us to coupling and equities in 2026, but it will only be evident in 2027 hindsight. I think we're starting that. But it's kind of like a bit of a cop-out prediction because we got to wait until

2027 to really like, no. This one we're probably just going to get cooked on because the AI trade screwed us. But Bitcoin rises 50% gold terms from a Bitcoin rotation trade. I think it's fallen 20 to 30% gold terms. AI was the thing that sucked most of that. Major asset manager adds a 2% allocation to their model portfolio. I need to double check, but I think we actually got that. But I'm not positive.

I can't remember if that was a Morgan Stanley announcement or not. Metaplanet achieves the highest MNAV. That's not happening. That didn't happen. Bitcoin receives conditional approval for a federal... A Bitcoin company receives conditional approval for a federal bank charter. Still time in the year. There's a lot of, I think, lines in the water, but may not get that.

A stablecoin uses Bitcoin as a reserve asset to pay interest to its whole. holders offshore. That hasn't happened yet, but that could happen this year. 21 Capital acquires strike, so close. And there's a bunch of others from a regulatory front on clarity, et cetera, blah, blah, blah, blah. Oh, I think one way we definitely did get was, uh, oh, Bitcoin Corn maintains dominance over alternative implementations. Definitely got that one.

It's never happened. See, sounds like a lot of those might not be wrong. they might just take a bit more time. That's right. Yeah, our last one was Deepak Ventures begins raising it's fun too. We're probably not going to do that. But we'll probably do it to get it next year.

You've just got to launch it on like the 31st of December just to get that check mark. Right, right. Yeah, we do have control over that one. Yeah. No, I'm all right, man. I've got to get on a flight to Hong Kong, but always love talk to you, man.

Thank you. A badger dude. Later. Speak you soon.