Dylan LeClair - Why Our Money Is Broken & How Bitcoin Changes The World

Full transcript: Dylan LeClair on London Real

2:42 This is London Real. I am Brian Rose. My guest today is Dylan Leclerc, the market analyst, writer and Bitcoin maximalist. You are the director of market intelligence at UTXO Management and the co-founder of 21st Paradigm, a consulting firm with the goal of helping individuals and businesses understand and utilize Bitcoin. You have become one of the leading macro analysts in the industry with your research and perspective featured on Fox Business and CNBC.

3:17 You are passionate about human freedom and economic empowerment in the digital age, and you have said our current financial system is broken, with traditional fiat currencies succumbing to inflation, manipulation and centralized control. Your goal is to educate the world about Bitcoin’s potential as a peaceful solution to the corruption plaguing traditional financial systems. You believe it is the pinnacle of monetary innovation, offering humanity its best chance at a fair and transparent financial future.

3:45 Dylan, welcome to London Real. Wow, what an intro. Thanks for having me. I’m really excited for this. Dude, I’m super pumped to have you. I’ve been watching you for years and really admire, you know, the way that you speak about Bitcoin.

4:00 And, you know, someone was asking me recently about you and I said, the reason I think people resonate with you, Dylan, is because you’re so congruent with what you say. And people can feel that energy, that you truly believe this to your core. And when we learn more about your life journey, your actions really reflect that belief. And so I can’t wait to get into your story and your thoughts on the market. But maybe we start with where we are today.

4:24 I mean, oh, my gosh, every day I wake up and I see Bitcoin, you know, with a 70,000 handle on it. I just keep thinking, wow, you know, is this a dreamland? Is this real? This is what we all thought would happen and maybe hope would happen. But we’re coming off of a two year winter bear market where it went as low as 16.

4:45 And there was a lot of pain or there were a lot of naysayers out there. How are you feeling right now about the market, about the future, about everything? Yeah, I mean, in regards to Bitcoin, pretty unfazed. This is kind of par for the course with Bitcoin. I think a lot of people get caught up in unit bias like, oh, it’s 70,000 or, oh, it’s two times more expensive than it was a few months ago.

5:10 And Bitcoin always feels pricey. It felt pricey. Most people, if you talk to them whether they started buying in 2013 or three months ago or anywhere in between, they’ll tell you, well, it felt really expensive when the person that kind of got me into it was buying it 10 times, like 90% cheaper. So I think it’s important to kind of understand this trajectory. This is not something that’s going to go away in the wind.

5:39 This is a shift in what we value and how we value money in the digital age. Because we live in a world, and I’ll often talk about the dollar and I’ll talk about the state of the US financial system. And really, that’s kind of a proxy for the global economic system, the global financial system. But we live in a world where you are going to, you know, everything you ever want, ever desire in this world is going to become more expensive and political currency terms forever.

6:09 That’s just a fact. That’s not people often make this bipartisan. They’ll tell you Trump or Biden did this. And this is really what’s actually happening. This is not bipartisan.

6:19 This is not red team or blue team. This is not just US or Europe. This is everywhere. It’s every developed nation and every developing nation has this problem. And oftentimes it leads to strife with the populace and class warfare and ethnic conflicts.

6:35 And there’s a lot going on here. But the root cause of a lot of this is the fact that 90% of the world is on a treadmill. And that treadmill is actually accelerating. And so there needs to be a solution here. And the solution isn’t political.

6:51 Because if you just look at the math, you look at just the debt burdens globally. We’re more indebted, not just in nominal number terms, in nominal fiat currency terms. Like people will throw out, we’re 30 trillion in debt, right? Well, the debt number doesn’t matter in isolation. The debt number relative to our productivity is what matters.

7:14 And relative to our productivity, the developed world has never been more indebted. So there’s no way to pay this down without a sustained period of inflation, with waves of inflation. That means we’re going to be in a world where your savings interest rate or just the interest rates themselves are going to be far lower than inflation rates for long periods of time. That’s the only way out of where we are. And so in that world, anybody that saves money in dollars or euros or yen or yuan or pesos, or anybody that lends money, creditors, anybody that’s a bond holder or saving money in a CD is going to get pillaged.

8:04 So IV Bitcoin, the fluctuations, the volatility, rode Bitcoin from 3,000 to 70,000 to 15,000 back to 70,000 and bought through it all. And you need to have some deep conviction to do that. But ultimately, the fiat exchange rate on a day-to-day basis is irrelevant to me, because it’s clear where we’re going. And where we’re going is a world where essentially the theft, the people who think of taxation as kind of how politicians will take the money. Really, the more insidious thing that’s not explicit but implicit is the inflation.

8:40 And most of the Western world hasn’t lived through inflationary regimes. We’ve had a couple of years of it, and the policymakers are saying it’s transitory. And they’ll often say, well, inflation’s coming down. Inflation was at 9%. No, it’s at 3%. But the actual price level hasn’t gone down at all.

8:59 The average price level is continuing to increase. It’s only the rate of change of the inflation that’s decelerated. So this is a big problem. And the reason I’m so passionate about Bitcoin, the reason I talk about it every day, the reason I bet my personal life, my social life, my professional life, and financially on this thing is because I believe there’s a massive problem in the world, the biggest problem in the world, and it’s that the money is broken.

9:26 And so you can think what you will about that, but I would say that’s a reality. And so with that, I’ve searched far and wide for solutions to this problem, political solutions, technological solutions, economic solutions. And really, I view the fix to this problem as a matter of engineering. And Bitcoin is an engineering solution to this massive problem, in my view. A fixed, apolitical currency absolutely scares that no one person can manipulate. This is the biggest idea of our time.

10:02 And people get fooled with the volatility and the trading, and they think that this is just kind of this wild speculation that has nothing backing it. And that couldn’t be further from the truth. So I’ve dedicated a lot of my time to go around and explain what I deeply believe, not to the benefit of myself, because again, this is a trillion and a half dollars. Me getting someone to put $1,000 in, or $10,000, or even a million, or even a billion, this doesn’t materially affect where this is all going.

10:32 So this is bigger than me. I’m irrelevant to the rise in monetization of Bitcoin. And it’s really kind of you can isolate yourself, you can insulate yourself from this thing. This is just an economic reality. So I like to try to articulate what I see is happening, and also to try to help people, because this is an ongoing problem, and it’s not going away.

10:55 So this needs to be addressed. I like that statement you opened up with, which says that maybe the first time you buy Bitcoin, it always feels a little expensive. And I was having flashbacks when I first bought my first Bitcoin in 2013. The quote unquote mid market at this thing that wasn’t really an exchange said it was like $85, and I had to pay $100, and it did feel a little expensive. And then maybe later when I paid $35,000, it felt a little expensive.

11:19 And maybe that’s actually a good thing for people listening to this that don’t own any to know that it’s natural for it to feel a little expensive the first time you do it, because maybe you’ve never owned a digital asset before. Maybe you’ve never owned something like this. Just like the first time you go for a mile run, you know, it might be you might breathe hard, but it’s okay. Maybe you’re heading in the right direction. You know, I also just thought of something that Bruce Fenton said, and other people have said he he runs the Satoshi Roundtable, where we met in Dubai.

11:48 And I just saw him in Paris at the Paris Blockchain Summit. And he says, in Bitcoin, everybody gets in at the price they deserve. And I’m wondering if you agree with that statement. And then also, what does that statement mean? Yeah, well, sounds a little it sounds a little harsh, almost.

12:04 But it is ultimately true. This saying was Bitcoin, it’s open source software, right? The creator of it is pseudonymous, never took any coins for himself or herself or them, right? Who knows who Satoshi is? I think it’s irrelevant at this point.

12:21 But this Bitcoin exchange hands and proliferated around the world for almost two years with zero or near zero market value, right? So it’s fundamentally different from, you know, cryptocurrency that launched yesterday. That was, you know, had a hundred million dollars of venture capital investment and, you know, technologists and exchanges that prelisted it and got an allocation. Bitcoin distributed for a couple of years with no market value. And even in the first three, four years of it, the total value of all Bitcoin was less than a billion dollars.

12:56 It was irrelevant. I mean, even at a trillion dollars in the pool of global wealth, it’s largely still not irrelevant, but very, very small in this kind of global pool of liquidity. So it’s been proliferating around the world and distributing for 15 years. And so, and through that process, it’s gone exponential and appreciated about orders of magnitude and crashed, you know, 70, 80 percent four separate times. So, you know, you get Bitcoin at the price you deserve.

13:25 Well, there’s been a lot of people that have had multiple, you know, if not, you know, probably 10, 50 touch points with Bitcoin that have ignored it. Or, you know, you first hear about Bitcoin at a hundred dollars, you dismiss it. It’s now 20,000. It’s now 70,000. You can’t possibly bring yourself to buy some now when you when you think back to your, you know, your previous mistake.

13:47 But ultimately, I think that’s a, you know, that some cost fallacy is a really poor way to think about this because I’ll frame it as such. Like what if there was a new digital, a political form of money that that arose from scratch from zero. Right. That wasn’t owned by a government that wasn’t owned by a corporation that wasn’t that wasn’t owned by, you know, a hotshot tech CEO. Right. Like this isn’t like Elon Musk creating his own money.

14:14 This is this is open source software. No one owns it. No one controls it. No one can stop the next block from being mined. So so if this never mind Bitcoin, forget Bitcoin.

14:24 Just imagine if we had a world where money wasn’t in the hands of governments and wasn’t devaluing in perpetuity forever. What would it look like? What would it look like? What would it look like starting from zero to go to world money or maybe not even world money, but a world money. Right. Doesn’t have to take everything.

14:43 But what if it’s just a global savings account? What would that look like? And for me, I really think it would look something like a lot like Bitcoin where you have massive speculation. You have waves of adopters. The first adopters were cypherpunk types, cryptographers, computer nerds mining in their basement.

15:01 The second wave was people that wanted digital cash to that they thought was anonymous to buy drugs and do stuff on the Silk Road. Right. And both those times it crashed 80 percent shortly after the 2017 wave was tech tech minded people and some speculators. Right. And the kind of Silicon Valley types and it crashed 80 percent.

15:24 And this recent wave in 2020 was, you know, people beginning to understand the macro picture of, oh, my God, they just printed 10 trillion dollars. Right. They’re printing 10. They’re printing. They’re printing a hundred billion dollars a month and rates are at zero.

15:37 And inflation is accelerating. I should get some Bitcoin. Right. And we crashed 70 percent. And the same bank went free.

15:43 It goes to jail and a whole bunch of fraud wipes out and hedge funds blow up and three exchanges blow up and market makers go under and lenders go under. And we crashed 70 percent. Right. And here we are. You know, maybe not at all time highs, but at 70,000, the high is 73. Right.

16:00 So we’re flirting with all time highs. The bond market is is melting. Right. And rates are at five and a half percent. So a lot of people said, well, this thing is just a zero interest rate phenomenon.

16:11 It’s just a speculative thing. It’s going away. Bowel hikes rates. We told you it crashed. Well, the rates are five and a half percent.

16:18 And they’re talking about cuts this year and Bitcoin’s at all time highs. So this is obviously not just a zero interest rate phenomenon. This is obviously not just going away and it’s proven a lot of mental models wrong. So you get Bitcoin at the price you deserve sounds very harsh and it sounds like, you know, we’re kind of excluding people. But no, it’s we’re this is an open network. Right.

16:40 Like a lot of people, a lot of Bitcoiners that anarchist types, they don’t they’re not a big fan of BlackRock. Right. They’re not a big fan of Wall Street, but it’s a permissionless system. So BlackRock says, hey, we’re filing an ETF or coming in and we’re going to buy 250,000 coins in three months. Right. We’re going to buy more than one percent of the supply of Bitcoin in three months because we’re hungry for this thing.

17:02 Our clients are smashing down our doors demanding this thing. And I can’t stop it. No Bitcoin can no Bitcoin proponent can stop it because it’s an open permissionless system. So you get Bitcoin at the price you deserve. Right. Is is more so saying, well, it isn’t the past of the past.

17:17 Future is the future. You can continue to ignore this thing and pretend that it doesn’t exist. But that doesn’t actually change or alter the reality of this. It would be wise for people that have, you know, ignored this or maybe got burned on crypto coins or, you know, bought high and sold low to really understand that this thing is actually a savings vehicle for the long term. And the volatility should, you know, you can maybe just ignore it, but also you should think of this as your friend.

17:45 The volatility of this is so much so that, you know, if you bought the $69,000 high in 2021 when Bitcoin was was $30,000 last year in 23. It was still 50, 60 percent from its highs. The people that bought just every single day, $10, $100, $1, doesn’t matter, just bought in increments from the highs all the way to the lows were up. They were up like 50 percent in dollar terms despite the exchange rate being 50 percent down from those highs. Right. So the volatility is not your enemy. The volatility is your friend. Right.

18:20 Because if this thing didn’t move at all, if this thing, you know, traded like, you know, like bonds or gold, right. The upside and like the, you know, the gains and the appreciation of the monetization of this, the monetization path of this, it wouldn’t be as lucrative. And a lot of people say, well, it’s gone up literally a billion percent. How much, you know, how much more, how much more can this go on? This is ridiculous. This is irrational. And to go back to the first point, it’s, well, no, this, this market, right.

18:51 People talk about total addressable markets, TAM, right. When a VC or, you know, a startup says, well, here’s our idea. This is the TAM. This is the total addressable market for, you know, Nordash delivery or whatever it is. Right. Here’s our idea. Well, the total addressable market for money is the biggest in the world.

19:10 So if that’s broken, right, if the cost of capital, if the money is centrally planned, centrally coordinated and fundamentally broken, right. Meaning you’re getting stolen from forever. Right. Like the price of housing, the price of literally everything you want, becoming more expensive forever isn’t because that there’s, you know, less and less houses every year. It’s not because there’s, you know, cars are becoming much more scarce and your deli sandwich is becoming more and more rare every year.

19:38 It’s because there’s more money supply. There’s just, it’s basic supply and demand. So with Bitcoin, right, this is just, this is continuing on a trillion dollars for all the Bitcoin in the world is cheap. Right. And so you get Bitcoin at the price you deserve.

19:53 Again, it sounds a little harsh, but I think it is. It’s a reality of this system is going to continue on and likely in my view, right. It’s going to continue to appreciate and, you know, boom and bust faces and, you know, it’s going to appreciate by an order of magnitude and it’s going to crash 50, 60 percent. Laughably, people are going to say, well, we knew it. Bitcoin’s dead. Right. And we’re going to do it again.

20:12 So that’s that’s kind of what I think about that statement. You mentioned BlackRock. How do you feel about the ETFs and what do you think the implications are? Obviously, they got announced in January and had a massive uptake. And like you said, they bought one percent of the supply. And, you know, obviously, the initial culture was a bit like us against them.

20:32 You know, Michael Saylor was in Madera and gave that great speech in the conference where he said these people aren’t our enemies. He said there are two types of people in the world, those that understand Bitcoin and those that don’t yet understand Bitcoin. And he said it’s all of our job to do that, which I guess is kind of how you live. But how do you feel about this ETF? What do you think the implications are going forward? Yeah. So, I mean, how do I view it is I mean, one, I was it’s inevitable.

20:59 I thought that before the ETFs that Wall Street and, you know, the you know, yeah, the Wall Street obviously is going to have interest in this. Of course, they are. Everybody’s going to have interest in this. But how I think of it kind of like a mental model is, you know, there’s there’s five hundred trillion dollars or some amount of gross amount of wealth in this world. You can call it three hundred trillion, five hundred trillion.

21:20 Some people say a quadrillion, which I think is too much. But there’s hundreds of trillions of dollars of assets. But if you think about how to balance works, you know, one person’s assets, another person’s liability. So, you know, all of this wealth in the world, there’s an equal amount of fiat liabilities. Like there’s three hundred trillion dollars of debt, fiat liabilities in the world.

21:41 So Bitcoin is just this little blip on the global asset side of the balance sheet. Right. It’s just this little tiny, tiny blip. And some people, maybe like myself or some, you know, early Bitcoin people have a disproportionate amount of their wealth. You know, 100 percent or 90 percent of their wealth. Some people even have, you know, if you have any liabilities, if you have any debt that you owe might have more than 100 percent of their net worth in Bitcoin.

22:03 Right. But that’s obviously not that the average person or the average, you know, on average, it’s less than one percent. Right. So maybe like 30 basis points, point three percent of global wealth, their average wealth is on that Bitcoin on the asset side of the balance sheet. So when you have a world, right, if we think about the fundamental rules and reality of the fiat system, of the dollar system, the system we live in today.

22:26 Right. Or, you know, the analogy of fish swimming through water and someone and someone goes, what’s water? Right. Like that’s that kind of where that’s the system we’re in. The rules of that system mean that the perpetual credit expansion forever increases the money supply is a is a fundamental requirement of the system.

22:46 So let me for instance, right. I don’t think a lot a lot of people don’t understand that when money supply is created through lending in the system. So if we just have a simple example, if we start if there’s $100 of global money supply and the bank lends out money that creates money supply. So if they lend out that hundred dollars and say five percent interest, well, then someone else now has a hundred dollars of cash. You know, they owe one hundred five dollars in the future and the bank has one hundred and five dollar asset on their balance sheet.

23:20 So that increase the money supply through lending. But if you think about it, because that loan has interest, right, the person has one hundred dollars in their hand, but they owe one hundred and five. So there’s not enough money to cover the debt. Right. And that’s just that’s just, you know, one example. Right.

23:36 A very, very simplistic example. But that at a much, much larger scale is how the system works. Right. So money supply is created through lending. It’s destroyed through their default or repayment of the debt. Right.

23:47 So if you paid off all the debt in the world, which wouldn’t be possible, there’s not enough money to do it. There would be zero. There would be no money in the system. There’d be no cash, no dollars, no euros, no yen left if all of the debt was paid. Right.

23:59 That would destroy the money supply. So there needs to be more and more and more money, credit expansion forever. Right. That’s a rule of the system. That’s just a rule. That’s why you see inflation is because like deflation in this system for central bankers, for for the treasury, for the U.S.

24:19 Government, for all of the governments of the world, deflation is is the enemy. It’s it’s almost like this. It’s like saying like Baltimore. Right. It’s like, boom, deflation. You know, it’s it’s it don’t say that we can’t have that. So what you have in that scenario is a world where the fiat liabilities are forever expanding. Right.

24:38 Along with the assets, the assets in dollar terms or euro terms are constantly expanding. So Bitcoin is just this little blip. And all it’s doing is just nestling itself on the asset side of the global balance sheet. And it’s it started with individuals and, you know, small businesses. And now we’re seeing some, you know, public corporations like MicroStrategy and some kind of more, you know, some some people that are maybe a little bit more ahead of the game.

25:05 Starting to put this on our balance sheet. Right. The ETFs come in. BlackRock has ten trillion dollars of wealth under management. Right.

25:13 They are directly plugged into the heart of Wall Street. Right. The plumbing directly to the heart of Wall Street. BlackRock’s plugged in there. So when they come in and say, hey, we’re offering a Bitcoin ETF and they’re promoting it like crazy, a lot of people will say, well, this is this is bad.

25:27 And for me, I say, well, guys, like this is one inevitable, but two, you know, what kind of Trojan horse our way into the heart of the financial system. So now we’re plugged directly in directly into the money spigot. But we’re Bitcoin is very close to the heart of the money spigot now. And that’s not a bad thing. That that is Bitcoin maturing as an asset. Right.

25:47 Because if Bitcoin is to become global money, it needs to become a massive, massive part of the asset side of the global balance sheet. Right. Especially swimming in the pool of hundreds of trillions of dollars of debt. That’s forever increasing. So I view it as like I’m not I tell people buy Bitcoin hold it in self custody.

26:06 ETFs are great for a tax advantage account or if you have a retirement account or whatever it looks like. But most people, I think the sovereignty is a really, really awesome part of Bitcoin. But are the ETFs a bad thing? No, of course not. I mean, this is this is one always an inevitability. And two, right, we’re plugged to the heart of Wall Street with trillions of dollars of wealth.

26:26 So I think it’s you know, that’s how I think of it. I was honestly blown away with the pace of initial buying and inflows. Right. Like the most like I had the game out last year. So that was I was tasked with kind of giving a range of estimates of how much I expected the ETF inflows to be.

26:44 And I forget the exact numbers I put out as we were kind of, you know, just saying the best case scenario, worst case scenario. And I think this shattered my mind on year one, my best case on just like the pace of the inflows, no outflows, rabbit. You know, the most successful ETF launch in history that grabs eyeballs. Right. So Bitcoin’s a huge story. And more and more people realize, well, no, it didn’t die with Sandbank been freed or, you know, the crash in 22.

27:11 This isn’t just a zero industry phenomenon. A lot of people’s mental models of the thing have been completely disproven. So when you can’t kill this thing, it continues to just chug along block by block by block. And the fundamentals keep improving. You know, you have to go from a zero percent position to a one percent position or else you’re being, you know, you’re taking risks. Right.

27:34 It’s risky to have a non-zero Bitcoin exposure, especially if you’re in a competitive field like Wall Street. Right. Where your competitor bought Bitcoin when the ETF launched, they’re up 100 percent. You didn’t buy any. When Blockrock, the biggest institution in the world, is promoting this. So I think that’s where I’ve been blown away.

27:55 I didn’t expect all the highs before the having. But, you know, certainly welcomed a welcomed moment. Yeah, I was pretty impressive because I had a slow start and then it all just came cranking in. You mentioned the having. Let’s talk about that. And then I got a couple of other questions.

28:10 But, you know, that’s something happens every four years. Obviously, there’s been a pattern of behavior in the past where the all time high happens after the happening or the having this year. This time it happened before you could say maybe it was because of this once in a lifetime event of the ETF. How do you feel about the having? Is it still relevant? Will it be relevant in the future?

28:31 And some people say, well, isn’t that already priced in because we know what’s going to happen? What is your read on it? Yeah. Well, it’s been interesting because, you know, the previous three havings, Bitcoin’s gone parabolic, you know, in the 12 months that’s followed. So there’s this kind of debate internally in the Bitcoin community, like cause effect.

28:54 Is this just spurious? Is it just by chance? I think in the early days having was extremely significant. Just, you know, for instance, 50 Bitcoin of 50 Bitcoin of issuance. I like to think of Bitcoin as having 21 million in circulation already.

29:09 And there is being unlocked rather than new supply being issued. Right. Like think of Bitcoin, the terminal inflation rate of Bitcoin is zero. Right. These coins are just being unlocked. Right.

29:20 Or even they’re just being purchased by the miners with electricity and computing power. So I think that’s kind of a good framing rather than being like, oh, yeah, they’re issuing, you know, they’re inflating new supply. But in the early days, right, when 50 Bitcoin was being issued every 10 minutes and you change to 25 Bitcoin every 10 minutes. As a percent of the supply, that was very significant. And then, you know, the next having was 25 BTC to 12.5, 12 and a half.

29:47 And in 2020 it went from 12 and a half to six and a fourth rather, 6.25. And now we’re going from, you know, 900 Bitcoin a day to 450 Bitcoin a day or three and an eighth per block every 10 minutes. I think it’s significant and I’ve explained this a bit before, but and this is maybe contrarian. But I think a lot of people say, like, this is a real supply event. This is a supply shortage, a supply shock coming to the market.

30:15 And this time around, they view it almost as a demand event. And what I mean by that is the Bitcoin system, the Bitcoin protocol was for the most part. And there’s been tweaks and some bug fixes and improvements to the base layer on the edges, on the fringes for the last 15 years. But the core protocol was basically set in stone once Satoshi launched the first version, V1. The essence of Bitcoin, the supply cap, the havings, how mining works, this was from release one has been basically unchanged.

30:50 So, right, Bitcoin’s ticking on regardless of what I think, regardless of what I say or anyone else thinks or says, there’s no one on the planet, literally no one. Not the US government, not Russia, not the richest man in the world that can stop the next block from being mined. So it’s a really powerful statement when in the face of F1C meetings and central bank policy decisions and oh, we’re going to cut rates or oh, we’re going to pause or oh, we’re going to raise rates or oh, the inflation print just came a little hot.

31:23 You know, stocks and bonds crash or go up and there’s this kind of like, this global financial system is just like a dance with how much can we gain the Fed, right? Like how much, oh, you know, how much can we really push this thing? How much can we push up markets and get away with it? And, you know, it’s like, and people are reading Fed tea leaves and there’s a real like the finance, financial markets these days, especially like equities aren’t really about valuing fundamental businesses.

31:54 It’s more about, okay, well, are they going to be expanding money supply or are they going to be, you know, kind of tightening the belt a little bit, right? Like stocks and assets aren’t moving because of, you know, their valuations or, you know, their business prospects on a day-to-day or month-to-month basis, they’re just moving with liquidity, right? So this is, it’s become kind of a game of like central bank tea leaves and this is a global thing, right?

32:19 Especially, you know, after the great financial crisis when they just said, we’re going to stimulate, stimulate, stimulate for a decade, right? And COVID was kind of just this like steroid to a normal, you know, a dead patient or a near dead patient. And so when there’s this Bitcoin thing that’s been ticking on for 15 years, crashed, it’s appreciated, it’s this, you know, this intangible thing that no one can see or touch so they don’t understand it.

32:48 And it’s saying, well, in the face of all of this economic chaos, in the face of, you know, Fed speak and Jerome Powell saying, we’re going to cut rates six times, so we’re going to cut rates three times, so maybe we don’t cut rates, inflation’s re-accelerating. And Bitcoin goes, we don’t care, like the supply issuance is getting cut in half in a week, you know, and technically like a thousand blocks or so. But blocking every 40,000 supply chains is getting cut in half.

33:16 I view this as just a global advertisement for what a lot of people, a lot of, you know, real, you know, Bitcoin proponents and people that have studied this deeply already know, right? But most people don’t don’t understand what’s happening. So is this a massive driver on the supply side? Well, you know, when I look at a lot of data, like I look at, you know, Bitcoin supply is completely transparent. I can see all Bitcoin in circulation. I can see when they move last.

33:45 It’s an open ledger of property of ownership. You see, you know, tens of thousands of Bitcoin changing hands every day, right? Some of them go to exchanges. Some of those are just people moving wallets, right? But thousands and thousands of Bitcoin are changing hands and getting sold and bought and held for years every single day.

34:02 And so I don’t think the most significant thing is especially when, you know, BlackRock is putting hundreds of millions of dollars in on a daily basis or, you know, the ETFs in general are buying and selling billions. I don’t think like from 900 BTC a day to 450 BTC a day for the miners is the biggest shift in the world, right? Like back of napkin math, like 60 million dollars a day of issuance to like 30 million and change. It’s not the biggest, biggest deal.

34:33 But what is a big deal is the power of this, you know, the reality of this protocol that is apolitical, right? It’s programmatic. It’s quantitative, right? This is like a quantitative tightening, right? Imagine if the Fed’s monetary policy was known for the next hundred years, right?

34:52 And like, obviously, that’s not how it is. This is a political, you know, kind of job-owning sort of thing. And then we kind of know this is just our reality, right? The entire global financial system, once every couple of months, we get up and we watch an old man speak and we kind of have to parse his words and his tone to think if he’s got to print more money or not. That’s literally what Wall Street does, right?

35:12 And the big Bitcoin people say, well, yeah, I mean, my monetary policy is unchanged until, you know, four years from now. But we know this, right? We know 21 million Bitcoin are going to be issued by 2140. We know that 99% of Bitcoin are going to be in circulation in the next 10 years, right? So the inflation rate or the issuance rate is getting cut in half in about a week.

35:31 So I think this was a really, really interesting or stark kind of comparison in 2020, right? This May 11th, 2020 was the last having. And that was basically the same exact time that the Fed was saying there’s unlimited money at the Federal Reserve. We have unlimited bank reserves. We’re going to we’ll buy as many bonds as possible and interest rates are zero.

35:53 And meanwhile, Bitcoin, as money printers go in burrs, says, no, yeah, we’re actually going to tighten the belt. We’re going to quantitative hardening. So I think when I say it’s a demand event, I think a lot of people have heard of Bitcoin. I would say 99% of adults have heard the term Bitcoin before. They know what some internet money thing.

36:10 But I think probably, you know, a small, small percentage of the world could, if you ask them, intimately explain the mechanics of the Bitcoin halving, intimately explain how 21 million Bitcoin supply cap is enforced, how mining works, how proof of work works, what’s the difficulty adjustment. And if you don’t know those things, that’s totally fine. But this halving event, you know, this thing that we knew was coming in advance is kind of just this global advertisement of, hey, we have a better money.

36:38 It’s just a superior system. It’s an engineering feat. It’s an engineering marvel. This is not political. Right.

36:44 And if you think of like, well, strip everything, you know what everything you’ve been taught about economics, everything you’ve been taught about the world of governments, what’s better? A bunch of old white men in a boardroom making decisions about the world money or computers and math. This is just math. Right. So I think that’s the real, real reason why the halving is so bullish in my view, because people all over the world are saying, what’s happening again?

37:09 Oh, this is money that’s programmatic. It’s digital. No one’s stealing from me. So I think it’s a demand event. I think a lot of people are going to have to come to, you know, do some digging and say, wow, this this thing just keeps chugging on.

37:21 So that’s why I love to have him so much. So then is Bitcoin going to go parabolic? Yeah, I mean, I’m pretty bullish for this year. I mean, in general, when and again, past performance is not indicative of future results. But in the past, when Bitcoin kind of breaks multi-year highs, you know, it gets really, really bonkers, you know, in the next few months or next year.

37:47 And so, yeah, like I said, I was surprised that the new all-time high was made pre- halving, you know, kind of broke a lot of people’s models of how a Bitcoin cycle is supposed to be. But I mean, we’re in a really interesting spot right now, right? Gold’s hitting all-time highs, bonds are falling, commodities are re-accelerating, oil’s hitting highs, a bunch of like kind of smaller commodities like cocoa and like our coffee are hitting highs. So this inflation problem that the central banks thought they kind of won, right?

38:19 There was like kind of a premature celebration of, well, we’re in this fight against inflation, right? And they, you know, kind of all came out and celebrated at the end of 23 and said, well, basically, like, we got this under control, we’re headed back to 2% inflation. Which if you think of it, right, like, why does inflation need to be 2% a year? I mean, that’s a different conversation. But, right, if this is just like kind of economic orthodoxy, like, well, this is what we need.

38:42 And no one can give you a good explanation for why, right? And it’s just because they need perpetual money expansion. So they say that, well, that 2% number is the right one. And it is right because 2% is just stealthy enough where you can’t really notice, right? Well, things only get a little more expensive every year.

38:58 But when that 2% is compounding to 5% or 6%, you really, really notice. So, you know, here we are, right? Inflation’s re-accelerating, rates are at 5.5%. And that’s not crazy, right? Interest rates were 10%, 20% in the 80s, right?

39:14 In the 90s, why is that such a big deal? Well, it’s such a big deal because our debt burdens relative to our productivity have never been higher, right? So we’re paying more. The U.S. is paying more on interest expense than it is on defense and military budget, right?

39:28 So this is like someone, you know, this is like a kind of a rogue teenager that has a credit card that just, you know, doesn’t know the first thing about finance and is racking up a TAF. And to pay those credit cards off, they opened up a new credit card, right? That’s the state of the U.S. fiscal position. So either the Fed has to cut rates, right?

39:47 And they goose this rogue system that has stops at all time highs, Bitcoin at all time highs, gold at all time highs, commodities ripping, oil ripping. Or they raise interest rates and where you fast-track to bankrupt a bunch of sovereign nations, the U.S. included, right? This is like a slow motion bankruptcy. And they’re not going to, you know, actually go bankrupt because they have a money printer.

40:08 But the bankruptcy means, you know, that prices of everything are going exponential because, right? The U.S. has to fund itself. And so that’s just going to come in the form of money printing. So I’m a really bullish on Bitcoin.

40:22 I mean, I’ve learned in the past, I’ve, you know, I’ve put out publicly like price targets or certain times that I’ve realized, you know, you can give a price target or a timeframe, but doing both is kind of a fool’s errand, right? Like I’m not in the, I don’t really care what Bitcoin does tomorrow or next week or even next month and maybe even next year, but I would be surprised if Bitcoin doesn’t, you know, go in six figures this year. And who knows?

40:44 I mean, I’ve eaten my words before, but I’m generally really, really bullish because nothing is stopping this trend, right? And never mind the dollar story, but the Bitcoin story is open source software, a technology that has its own adoption curve. And we haven’t even talked about the energy, the energy side of this, right? The fact that Bitcoin is being powered by all of this waste energy around the world is just another, is another thing that no one kind of understands.

41:10 Like it’s not just intangible. Like there is actually physical, physical infrastructure. And it’s, and it’s actually, it’s not bad for the climate, bad for the planet. This is using waste energy, right? So you go out to these random oil fields, they’re spewing methane into the atmosphere and sometimes they just flare it.

41:27 You know, you see this, this fire burning into the atmosphere, there’s burning methane, burning natural gas to make it a little bit less bad for the environment. Well, Bitcoin miners come in, they combust all of that, that terrible methane for the ozone layer. You know, it’s like 80 times worse than carbon, carbon dioxide. They combust that, they turn it into electricity and they turn it into, into digital money, right? So Bitcoin miners are doing a huge service to the, to the grid and to the, you know, environment.

41:56 And it’s, it’s interesting because, you know, a lot of that kind of the progressives or not even to make this political, but the climate, you know, the people that are very, very interested in the kind of the long-term trajectory of our climate are against Bitcoin without realizing that this is a technological innovation. This is like carbon capture technology. And a lot of people think it’s the opposite. So that’s, that’s one, you know, we never mind the deficits and the money printing, which is a reality, which isn’t going away, but Bitcoin itself, right?

42:28 The numerator BTC slash USD, the USD problem is, is not going away. Everything’s going to become more expensive, stocks, stocks, gold, real estate forever, food. But the BTC aspect too also has its own adoption curve. And that’s never been stronger. And that will continue.

42:47 So I’m super bullish. I mean, I expect higher prices, but should you expect 25% pullbacks, 50% pullbacks? Yeah, of course. Yeah. Welcome to Bitcoin.

42:57 You know, it’s funny you talk about the old man in the room and the tea leaves and stuff, you know, I’m getting flashbacks, Dylan, because I, I was, I was in Boston for four years, was at MIT. And then I went to Wall Street. And so in 93, I got to Wall Street and I’m this punk ass kid. I got one suit. I’m 22 and I go on this trading floor with these 300 of these crazy alpha females and males all on basically this fixed income trading floor.

43:21 And I was trading fixed income derivatives and they started teaching me about the way the market works. And they’re like, well, you know, there’s this thing called non-farm payrolls. And every month we all wait on eggshells for it to come. And then we look at the number and then the markets react and all these. Here’s how it works.

43:38 And it was just, it was weird though, because I was a fish in that water. And so I never asked questions, you know, these men and women were making, you know, a hundred or a thousand or 10,000 times that I had made the previous year. And if I went along with this hocus pocus, I would make the same type of money. And I did. And yet no one ever, when I was there, I was kind of pre-internet ever stood back at a, when we’re having drinks out on the town of Manhattan saying, Hey guys, um, did you ever wonder like what the federal reserve is or like who owns it or like no one ever asked that question.

44:11 And it’s even funnier, Dylan, if I even backtrack back to MIT, I had to take microeconomics and macroeconomics to get my mechanical engineering degree at MIT. And to get my mechanical engineering degree, I also had to take physics and, um, vector calculus and thermodynamics and fluid dynamics. Now these are serious courses that really describe the natural world, not down to the, the, the T because there’s all this weird Newtonian stuff. But like, this is a way of describing the world that is, is fairly correct.

44:46 And you can mimic it in any environment. And I’m telling you, Dylan, when you put me as an engineer in a micro or a mechanical economics course, where they give you these ISLM curves, you know, we always kind of looked at the professor’s kind of a scants and thought, you know, this is kind of bullshit. You know, it’s one thing if you’re telling me a thermodynamics piece, and I got a gas and you heat it and it expands, I can repeat that in any lab, in any city in the world for the next thousand years.

45:13 But you tell me this is how the economics works, except in 84, except in 1932, except this year, except this other time. And I mean, honestly, Dylan, none of us ever bought it. And yet we could never zoom out and say, well, maybe the big problem here is something nobody’s talking about, which is this fiat money system that’s skewing everything and just totally screwing up all of our assumptions. And so listening to you makes me have these flashbacks where honestly, deep down inside, I knew something wasn’t right.

45:46 And yet no one talked about it until we had this parallel universe of Bitcoin to maybe compare it against. And when you see something versus Bitcoin, it becomes really clear, in my opinion, how messed up your fiat assumptions are. Anyways, that’s just some memories I’m having. I’m curious if you have any thoughts about that. Totally, yeah.

46:06 I mean, you’re 100% dead on economics as we know it today. Keynesian economics is sort of a pseudoscience. It’s like, well, this is how it is, right? This guy theorized, well, if we have an economic downturn that’s caused by the downturns that we know of, or the recessions that we know of are caused by a contraction of credit now, it’s not like the world suddenly became less productive. You can generally think of it, and Ray Dalio has a really good piece on this.

46:35 If you just look up short-term, long-term debt cycle Ray Dalio on YouTube, he has a really long book on it with case studies and all that, which was a great read for me. But the YouTube video is 20 minutes. It’s fantastic. Everyone should listen to it. But in general, he said, well, with technological progress, our productivity is up and to the right, right?

46:54 And there’s not really much fluctuation there. We can do more industrial revolution or the internet, microprocessors. Humanity is becoming more and more efficient, more and more productive. We can do more with less. In general, that raises all of our living standards, right?

47:09 But the economic cycles aren’t straight line up and to the right. We have these kind of these boom and busts that are a result of pulling productivity forward. So if I borrow a bunch of money to buy something or make an investment or buy a factory, one pulling for my future self, right? And so at some point I do have to, I’m consuming more than I produce now, but at some point I’m going to have to produce more than I consume to pay that down. And so that’s just an individual example, but that happens in aggregate with the economy.

47:39 And we kind of see these boom and bust cycles and human psychology is very much intertwined in this feedback loop of asset bubbles and booms and busts, right? And they get exacerbated the more and more debt you have. And so, you know, from an engineering perspective, right? When you kind of evaluate or, you know, if you’re looking at, you study thermodynamics and then you go to macroeconomics, you’re saying, well, wait, well, this is, this is a pseudoscience.

48:05 And so I think, you know, for the, if you’re in the eighties and nineties or even 2000s and, you know, there is no actual alternative, it’s completely understandable to say, well, yeah, I mean, we don’t have any, any other system, right? In a world where gold, the property rights of gold, the scarcity of gold, the soundness of gold could be teleported instantaneously from one person to another or from one merchant to another or business to business, you know, across, you know, across the Pacific ocean. We wouldn’t need, we wouldn’t need fiat currency.

48:36 The only reason fiat currency and, you know, as we know it today arose was because gold didn’t scale. So people left their gold with blacksmiths. They left their gold in the vaults of what became known as modern day banks and they were issued certificates to deposit on their gold. People realized that the bankers realized, or the people that held the gold, they weren’t yet bankers, realized that no one ever came for their gold. They just, the certificates of the deposit were a much better, easier system to transact.

49:04 So they realized, well, hold up. If no one ever comes for their gold, well, I’ll just give out more certificates of deposit, right? And that’s, that was the start of modern fractional reserve banking. And so through that system of, of basically realizing, well, Hey, if, if I can lend these certificates out of interest and they’re backed by gold, but I don’t have, you know, there’s way more certificates out there than actually have gold in my ball and I can make money doing this. Why wouldn’t I, right?

49:30 This is like a financial, you know, this is like modern alchemy, right? People tried to create gold for, for so many years. Well, I’m doing it right now by issuing paper. Yeah. I’m doing this through an accounting ledger, right?

49:40 That’s, that’s the fractional reserve banking. And, and through, you know, world wars and through just a bunch of isolated kind of bank runs and eventually, you know, the federal reserve in the U S was implemented in 1913 and gold right at the base layer during credit contractions during these expansions, it was fine, right? Everything backed by gold and the economy is booming and we had the wrong twenties, right? And there’s this massive stock market boom, but when it all came crashing down, right?

50:09 And the Piper had to be paid and everyone ran and scrambled to the bank to get their gold. There wasn’t enough gold to cover it. So the politicians, they seized their gold and said, you know what, you know, okay, we’re going to take your gold. It’s still backed by gold, but your money, you know, we’re going to double how much it takes to buy some gold, right? And we get to the, you know, the 1970s and we’re on this global gold standard post Bretton woods, post world war two, where the U S dollars backed by gold, all the other currencies are backed by the dollar and you know, the U S has golden Fort Knox and they have gold backing the dollar, but they’re running up a debt, right?

50:43 So all of these countries, similar to kind of the example of people running up to the bank and saying, Hey, can I have my certificate of deposit? Well, nations were saying, Hey, can I have my gold fruit for these dollars? And you know, eventually Nixon in 1971 said, no, right? So, so we wouldn’t need fiat currency at all if gold could be teleported. Right.

51:01 But now we’re in a world where Fiat isn’t backed by gold. Fiat is just backed by debt. Right. So, so gold maintains value across time, but across space gold is a terrible money. Fiat is a, is a great money across space.

51:14 Right. I can teleport you money over cash app or Venmo or swift or whatever. Right. Fiat scales for an international economy, but it’s a terrible money across time. Right.

51:25 So, you know, in theory, if we could engineer something that had the scarcity and durability and fungibility of gold and the production cost of gold, but it could also be teleported across the internet or across the world, across the Atlantic ocean, that would be ideal. And so we have that now. And it’s, it’s understandable that like for the longest time, when there is no modern solution, you know, it’s like, well, this is, this is a system we have, you know, we can’t scale a global economy on gold.

51:55 Right. That’s why I also disagree with the gold bugs. Like I agree with their thesis. Yes. The money’s broken.

52:01 Yes. This is unsustainable. Yes. This is a massive debt Ponzi out there. But the reason we’re on a Fiat standard is because gold failed and it didn’t fail to maintain your purchasing power.

52:10 And one, one gold ounces, one fine man suit still is right. You can probably buy, maybe it’ll probably take a couple of gold coins to buy your seat right now. Either way. Right. It’s that was about true a few years ago.

52:22 Okay. But we’re not going to go back to a global gold standard because why? Well, what you’re, I’m not going to carry gold coins in my pocket. So I’m going to what I’m going to say, well, this, this IOU that I’m transacting with you is backed by gold. But the history of human psychology and the history of economics, just, just, you know, read economic history is full of breaches of trust time and time and time and time again.

52:48 Right. So if you think we’re just going to return to a gold standard despite it failing time and time and time again, you’re naive and not, you know, not to be harsh, but that’s just, we’re not right. So there’s a reason we’re not using gold today. So that’s where, you know, the modern law and real like, you know, kind of scientific law, like the laws of thermodynamics, right? Energy is not destroyed.

53:08 It’s only, it’s only transferred. It’s only transmuted. Right. Well, that very much, I mean, Bitcoin is very much aligned with that system, right? Bitcoin is an energy money.

53:17 It’s an energy currency, right? Like there’s a bunch of Bitcoin miners out there, right? For instance, you know, I know people that run a sauna in, in, in New York. And the sauna is heated with Bitcoin miners because they, they know they already have to make the heat, right? They already have to create the heat.

53:33 So they, you know, they have heaters and they’re just, you know, pumping in natural gas. They’re pumping in electricity to basically make the seat. And it’s very much inefficient. And they realize, well, if I’m going to have to create the seat anyway, I might as well just mind Bitcoin and the byproduct of Bitcoin mining electricity goes in. Ashes gets rewarded with some Bitcoin and the excess is a bunch of heat.

53:54 Right. So this energy money, well, the excess of, you know, securing this energy money is a whole bunch of heat. Right. There’s a tool of farmers in Amsterdam that have a greenhouse power that heated by Bitcoin miners. Right.

54:07 So Bitcoin, if you really dig into the assets of an energy money, right, this is aligned with the loss of thermodynamics, right? Central bankers on a ledger saying, who trillion dollars printed is not right. There’s no production cost for dollars. There’s no production cost for euros. There is an energy production cost, a computational production cost for Bitcoin.

54:27 And that’s only going, that’s only increasing. And so I think if you apply the loss of thermodynamics and you think of like, well, what would an ideal ideal money be aligned with the laws of, you know, the physical laws of our universe? Well, it would be, you know, it would be energy money. Right. And it would also have to account for like Moore’s law.

54:45 Right. Because if you had, if you had an energy money that could be created through computation, well, what happens in a world where computation becomes ever and ever and ever more efficient and better and better and better. Right. Like for the last 40 years, semiconductors have become twice as good every two years. And that’s exponential.

55:02 And a lot of people, you know, exponential curves, like it’s, it’s hard humans don’t do well with exponentials. So if you had an energy currency, but as, as computers increased in their efficiency, semiconductors got better. It would be a pretty bad money if it couldn’t protect against computers becoming more and more efficient. But Bitcoin is an energy money that also has a difficulty adjustment. So the more resources you try to throw at this to mine it, it becomes incrementally more difficult and more difficult to mine it.

55:30 So it’s this, it’s this perfect energy money. And I think a lot of people haven’t really dug into what, what this means and the implications are massive. They’re really massive for the energy systems. And there’s a whole bunch of energy engineers out there that are coming to understand, holy crap. Like, you know, if we have to build out a renewable energy grid, right?

55:51 If we have to build out, you know, if we want to go away from fossil fuels, right? It’s not going to be able to buy energy, it’s going to be able to build out of the world. And so if you’re going to be able to find out about the idea of nuclear or whether it’s solar or wind. You need right. These are, these are intermittent power sources.

56:05 You need something. That is buying energy when no one else wants it and it’s selling energy when everybody wants it. Right? The reason you don’t blackout to because your grid can’t handle. These, you know, these massive surges in demand.

56:16 So, you know, some people will say, well, battery tech, right? Well, batteries aren’t perfect. They’re extremely costly. And they rely on. You know, basically like, I mean, to get their minerals to create these batteries.

56:27 So what you really want is you want something that can dynamically use energy and instantaneously flip off and on depending on when it’s in demand or not. And there’s nothing out there in the world that can do this. But now we have Bitcoin. And so this is a real, real, like if you wanna really geek out in the laws of thermodynamics and how humanity scales and energy system scale, Bitcoin is a really, really fascinating, mind-blowing, Bitcoin mining, mind-blowing discovery.

57:02 And I think a lot of people haven’t really come to terms with that. So that’s one of the things I really love to explore. Yeah, you’re giving me flashbacks to my two conversations with Michael Saylor, who graduated from MIT, I think about six years before me and he was aeronautical engineering. But when I first had him on in 21, Dylan, he was calling to digital property and that’s the way he kind of explained it to me. Imagine a block in Manhattan and there’s this piece here and it’s forever gonna have value and he was making this analogy with Bitcoin.

57:31 And at the time, nobody was really explaining it that way. And I thought that was fascinating. And when I had him back on about a year, year and a half later, he had kind of advanced to this concept of digital energy, which was harder to grasp for most people and even me at the time, but I was like trying to meditate on that over time. I was starting to now see what he was talking about, especially based on what you were talking about. And he kind of went in even deeper and started looking at biology and thermodynamics and starting looking at this as almost like a law of nature.

58:02 You don’t create Bitcoin, you discover it. Just like you don’t create DNA, you discover it. And he’s really gone deep on this. And it’s interesting because I have a crypto and DeFi academy and so my students always say, Brian, where do I get my information? Where do I get my news?

58:17 I say, you know what you could do? You could go to the coin desk and the coin digraphs and waste your time or you could listen to sailor on repeat for 50 hours. You know, because that’s, if you really wanna understand this, that’s what you should do because it takes a long time to understand Bitcoin and I’m nowhere near wherever I wanna be, but it’s like, it almost like, it’s like sitting in, you know, like a sauna or something. It just takes a while for it to really sink in and for it to go all the way down in your core.

58:48 And the more I listen to Michael, the more I start to understand some of the things you were referring to. And I would just encourage anybody who this isn’t making sense to, to just listen to more hours of people like Michael, maybe people like Dylan, people that have really gone deep about it, talk about it and it will start to sink in because again, we grew up in this world where we’re fish and water. We grew up in this world where we were literally brainwashed, you know, from our education systems for every system around us that this is the way it is when in fact, maybe it’s not.

59:19 So yeah, I think it’s important to let it really sink in for what it is. And again, this concept of digital energy is a deep, deep thing. And if we can understand it to our core, I feel like this world behaves differently going forward. Do you feel like that that’s the same case when you think about how people learn about this? Do you think there’s just levels and layers to understanding Bitcoin?

59:47 Yeah, of course. I mean, the beauty of this is that there are no real experts in everything, right? Bitcoin, it crosses so many domains for, like I came across Bitcoin from the economics perspective. I was really digging at the core. I was reading Ray Dalio’s frameworks.

1:00:03 I was reading the intelligent investor trying to learn Warren Buffett principles of investing, you know, like I was thinking of buying dividend stocks in high school, right? I was like, well, I understand compound interest and I’m a math guy, you know? And so I want to learn investing. And so I found Bitcoin from that angle. And some people found Bitcoin through computer science, right, there’s some people and maybe not the most, but some people are, you know, working in energy systems and are working on an oil rig and they find Bitcoin mining because it’s plugging into their operation to make it more efficient, right?

1:00:39 So there’s so many kind of domains of expertise here, right? Well, software developing, the energy side, the economic side, like, you know, some people even take it kind of like politically, you know, like some people go like dive into philosophy of this. Some people think, and maybe like, this isn’t for everybody, of course, but some people think there’s a religious component here, right, where if you look at, if you look at Christian, you look at, you know, kind of biblical texts, if you look at Islamic law, like usury has been banned or was banned for centuries, right?

1:01:10 And so if we have a money, like Jesus kicked the money changers out of the temple, right? And maybe that’s, you know, looking too much into this and that’s fine, I understand everybody’s not religious, but some people, like there are so many ways to kind of rock this and think about this. What it truly means if we have a superior engineered money that lasts a thousand years, that usurps the powers that be and the political currency issuance. Because if you think of it, right, imagine it’s just remove the money aspect.

1:01:42 Imagine if I could just print 20% of your work, right? If I could just steal 20% of your labor without you asking, without you voting, right? This is not, you don’t vote on inflation. You don’t vote, right? So it’s not a partisan thing, right?

1:02:00 It’s just like, no matter what, you’re on a treadmill. And so, and this is, I think, you know, a lot of people, like most people in my life, like my personal life, I’ve, you know, nerded out to them and given them the Bitcoin spiel. But I tell them, look, like this is money that’s better than your dollars on a longterm. And you can have, you know, three to six months of dollars in a savings account, you can have your buffer. But if you’re thinking about having a family one day, you’re thinking about saving for a future.

1:02:26 If you want to buy a home, if you want to, you want to preserve your time and your labor, like you need Bitcoin, you need something that’s not going to steal from you because dollars aren’t going to cut it, euros aren’t going to cut it, fiat currency isn’t going to cut it. And I think that’s, you know, you can go really, really, really deep into this and you can look at the analytics side, like I do, and some people really get into the financial derivatives and stuff and like, love it, I love it all. And I’ve kind of explored it all.

1:02:51 But really, I, you know, kind of keep it simple. Just buy a little bit every day or every week. Doesn’t have to be a lot, you don’t have to go all in. You can’t sleep at night, you’re overexposed. But you should really have some because this is a building block for your future that’s not going to steal from you.

1:03:05 So yeah, I mean, I go really deep on it, right? Like I listened to, you know, a ton of what Michael Saylor has said. He’s obviously a student of history, right? Like if, you know, about Michael Saylor’s past, Michael Saylor in 2010 wrote a book called The Mobile Waist and was like, look guys, he wrote this entire thesis. I mean, he’s even, you know, had some like public interviews and appearances.

1:03:26 And in the essence of it in 2010, which was, you know, kind of right at, I mean, coming out of the heels of the great financial crisis was look, Google, Amazon, Facebook and Apple have already won. They’re big tech monopolies, they’re competitors, right? Like if you were investing in Samsung or Dell or Intel or Blackberry or Yahoo, you don’t get it. These are big tech monopolies. They’re two, they’ve already surpassed their competitors and everyone’s looking at how to invest in them and they’re trying to trade the stock and they’re getting in and out and they’re buying and selling and they’re looking at price to earnings ratios and multiples and the dividend yields.

1:04:05 And that makes no sense. The company’s undervalued if you understand where this is all technologically going. And like Saylor, this is before Bitcoin, right? You know, three years later, he actually says, you know, I think Bitcoin is gonna go the way of gambling. It’s gonna collapse, it’s gonna disappear.

1:04:20 But he put out in 2010, right? Where these companies had didn’t die, they had persisted and they continued to grow at an exponential rate and said, look, they already won. Just buy hand over fist and sit on it for a decade. And he was right, right? Like the fang trade, the 10 big tech trade was the trade of the 2010s.

1:04:38 And I think he made like 500 or a billion dollars off of it. And so, you know, when Saylor said in 2020, yeah, I was wrong about Bitcoin in 2013, I’m gonna buy more Bitcoin now in dollar terms than anybody’s ever purchased ever, right? And some people said, you’re buying Bitcoin in 2020, you’re buying a billion dollars? That’s raciness, it’s already, the trade’s already played out. And he goes, look, it’s already won.

1:05:00 Like, and then some people will say that’s controversial. And we have a lot more work to do. And I agree, you know, Bitcoin has a lot more work to do. We are, you know, soon entering the they fight you stage. But, right, like, it hasn’t died.

1:05:15 It’s collapsed 80 times, it’s collapsed 80% four separate times. The biggest, only exchange in the world collapsed. It didn’t die. The second biggest exchange in the world collapsed two years ago, it didn’t die. So what’s killing this thing?

1:05:27 And so I think that’s where, you know, a lot of people, you can go as deep into it as you want, right? And I encourage people to, because the intellectual rabbit bowl is stimulating. But the real thing to understand is that you don’t need to be an investor. You just need to save, right? Like, you don’t need to trade, you don’t need to look at charts, you don’t need to draw lines, you don’t need to buy here and sell here, just buy.

1:05:48 Just buy and hold a superior asset. And I think that’s, you know, it’s not financial advice, this is savings, just saving in a superior form of money. Good advice. Dylan, tell me about your story, because you don’t have a college degree, which most people would be shocked at. You at one point, I think worked manual labor jobs just to make enough money to buy Sats and stack Bitcoin.

1:06:13 Tell me how you got here, because it’s a weird, it’s a unique journey, I think. Yeah, well, yeah, it’s a fun journey. I was starting to go to high school, and I started studying economics and finance rabbit hole. I went to college for a year in 2019. Long story short, I kind of stumbled down the, the Bitcoin rabbit hole, took the orange pill, but wasn’t fully, yeah, it didn’t fully click.

1:06:39 COVID comes around, they send us all home. The value of the college education over a Zoom call wasn’t much when anything that I didn’t understand about the world or finance or economics, or just the world in general, I looked up on Google and I would just watch a YouTube video or read Investopedia, or they were signing us, oh, here’s the balance sheet, blah, blah, blah, here’s a textbook, right? And it’s a 1980s textbook taught by a 75 year old professor that doesn’t understand Zoom.

1:07:05 And it’s like, well, what’s the value there? And so, you know, then they print $10 trillion or however much they printed in COVID. And it was this old crap moment of like, I’m fully orange-pilled, I need to acquire as much Bitcoin as I can, I’m a broke 19 year old, what am I gonna do? So I dropped out of school to my parents, made my parents weren’t happy. And I worked manual labor, and I irresponsibly took on as much debt as I could find, which is like, I don’t recommend that at all.

1:07:37 But yeah, to acquire as much Bitcoin as I could. And lucky enough, stumbled into a Bitcoin job, doing some stuff, just some editorial stuff with Bitcoin Magazine in 2021. But for, yeah, a year, I was lacing on my work boots and putting on a cardigan and going and wiring outlets, doing manual labor to buy as much Bitcoin as I could, while the rest of my friends were entering their second year. So yeah, I mean, I think there’s really, obviously a degree is important for engineering, or if you wanna enter the medical fields or many, many things that require these things.

1:08:14 But for me, and I think for a lot of people, especially kind of like the social services and anything else, college is much more, it’s the kind of shepherd you into this path that you need to do this, you need secondary education. And not that it’s a bad decision, but I think we’re in a really interesting inflection point in history, because the value of education has never been, or the cost of education has never been more expensive in absolute terms and is relative to a median income. It’s never been more expensive.

1:08:44 And at the same time, we have this technological boom and this information explosion where information’s never been more free. Like any question I have about coding, about economics, about finance, I can, and it’s not 100% reliable, but I can look it up on chat GPT or Google and more or less kind of figure out what I want to know pretty easily. And so it’s this really weird dichotomy where it’s never been more expensive. People are entering hundreds of thousands of debt for information that’s free and abundant.

1:09:16 And so that was clear for me. I read Jeff Booth spoke the press of tomorrow and said, well, okay, I’ll take a leave for a year. And that’s what I told my parents, but it wasn’t a leave for a year. And realized that I just acquired as much Bitcoin as I could. And compared to someone that bought Bitcoin in 2015, it wasn’t a lot.

1:09:32 But for me, it was like, I’m thinking about myself 40 years from now. And I still love the college life. And I lived it for a couple of years, but was working and acquiring as much Bitcoin as I could. So fast forward. And I worked kind of in and around Bitcoin and did a bunch of analysis.

1:09:51 And I’ve always kind of been a numbers guy. So I did some on-chain analysis and Bitcoin native analysis for their financial newsletter. And now did some work and still am with UTXO Management, which is a liquid fund in the Bitcoin ecosystem. And so Bitcoin all day, every day, but yeah, it was a leap of faith and better to be lucky than good. But I was deeply convicted in the trajectory of everything.

1:10:20 And so, yeah, I had no credentials, but I think the best part about this Bitcoin space, and I think in general, where the world’s going is it’s not about credentials. It’s about the information you can convey, the information you know. It’s about expressing your ideas, right? Like the beauty of it is, I was a 20 year old kid putting my ideas out there about Bitcoin, about finance and economics, and where this was all headed. And someone, you know, it wasn’t like, oh, well, you’re just a dumb kid.

1:10:48 It was like, well, the ideas have merit. And you know, I understand I couldn’t go work at Goldman Sachs, right? But that’s okay, you know? Yeah, you know, it’s funny when I first started interviewing people in this space back in 21 and 22, I used to tell people, I used to say, it takes a village, which I guess is that old African phrase or something. I used to say, you know, it takes a village to raise a kid.

1:11:11 And I meant it takes a village of experts to raise a Bitcoin convert. And I meant like not everybody can get it from Michael Saylor and not everybody can get it from Jeff Booth and not everybody can get it from Max Keiser. Sometimes we needed a Dylan Leclerc or someone else that’ll resonate with all these different types of people. Or maybe you need them all in unison, or maybe you need one person in January and the next person in March. And so every voice is important here.

1:11:36 And with you, as I said in the opening here, like you’re just super congruent. It’s just like you walk the walk, you talk the talk, you act the way you feel, and then everybody gets that right away, which makes your ideas valid. And you’ve done the research and you’ve really done it. And in no other space could that happen in my opinion. Like, you know, again, in medicine it wouldn’t happen, in physics it wouldn’t happen, but it happens in this space.

1:12:01 And it’s one of the reasons I love this space is that somebody knew without a college degree that’s young can soon become an important spokesperson for the space, you know, which is what you have become because of their conviction and their passion and their knowledge and their research and their work ethic. I mean, that’s beautiful. So yeah, thanks for doing that. When we were at Satoshi Roundtable, you know, we were there for four days or five days. And the essence of that is everybody breaks into these de facto, you know, these kind of groups that just are made by people’s interest when we talk about things.

1:12:36 And again, it’s kind of the invite only, it’s a lot of kind of OGs in the space, people that don’t even like to go to conferences sometimes, it’s like an unconference. And a bunch of the topics that week, Dylan, were about Bitcoin. They were about the Bitcoin chain, but they were about, say, ordinals on the chain. They were about DeFi on Bitcoin. And I’m curious how you feel about those things in the ecosystem that you feel so passionately about.

1:13:01 Funny enough, Michael Saylor was just at Peter Diamandis’ abundance event, and I’ve had Peter on the show as well. And someone asked him about it. And Michael said, he said, I do DeFi and Bitcoin all the time. What do you think what I do when I issue convertible bonds in the market and use that cash to buy Bitcoin? He’s like, that’s DeFi in a way.

1:13:20 And everyone’s gonna bring whatever they want to it. And it’s open source. And it’s, you know, again, it’s anybody can do what they want. But I’m curious, how do you feel about these protocols using the chain? How do you feel about someday people earning interest on their Bitcoin?

1:13:35 What are your thoughts on that? Yeah, well, you know, I was kind of under the impression that, and it was kind of a popular mantra in 21 as I was getting up to speed with everything. And, you know, I’m a Bitcoin maximalist for sure, but I’ve, you know, done some deep study on the underpinnings of crypto at large. How does Ethereum work? How does Solana work?

1:13:59 Maybe I don’t care about crypto, but Terra Luna imploding in 2022 had a real impact on the exchange rate. So me as an analyst, me as a Bitcoin person, particularly one, you know, where I’m, like I said, I’m not concerned about the exchange rate, but my job was concerned about the exchange rate. So I need to learn how these things work. So I’ve done a very deep dive on a lot of these mechanics. I think the, you know, dichotomy between Bitcoin, which is kind of the sound thing that doesn’t change really all that much and is more just tweaked and fine-tuned on the edges versus the build fast, break things, hard for culture of crypto was really, really interesting and still is.

1:14:39 And we’ve seen, you know, there’s an explosion of developer interest and, you know, VC funding to the crypto complex while Bitcoin, you know, has struggled to find funding for open source developers. And, you know, the Bitcoin VC market was for years, pale pales, you know, small, tiny blip compared to the massive amount of funding in crypto. Despite Bitcoin being 50% of the, 60% of the quote unquote market cap of crypto, right? So Bitcoin, the biggest asset, but gets a tiny sliver of the funding and the developer interest.

1:15:14 It was really interesting. And, you know, this guy, Casey Rotemore came with basically saying, hey, we can put arbitrary data with, you know, these things called the ordinals, you know, string of letters and numbers essentially into a Bitcoin transaction. And with it, we can kind of do, we can create a file, right? We can create a JPEG or we can create, we can put an MP4 or it could be a GIF or it could be a video or, and so some of the stuff that has happened on these alternative chains can happen on Bitcoin.

1:15:44 And a lot of people in Bitcoin, including myself, at first I really flinched at the idea of like, well, you know, this is, you know, speculation and casinos and do we really want this on a sound monetary layer. And the more I thought about it, the more I, well, this is open permissionless money. This is a consent. These are consensus valid transactions. And if I think this, you know, this Bitcoin monetary network is going to be worth a hundred trillion one day, then the block space for that $100 trillion asset and the block space to secure settlement for this asset is going to be extremely valuable.

1:16:18 And so the real interesting thing has been that that kind of seemingly, you know, real at the first like unimportant or kind of sideshow development has led to an explosion of developer interests and crypto native VCs, right? Crypto VC was tens of billions of dollars and none of them had any Bitcoin. Cause the thesis for Ethereum, investing in Ethereum protocols, investing in alternative chains, investing in, you know, whatever companies that didn’t touch Bitcoin was, Bitcoin’s a dumb digital rock.

1:16:53 It can’t do anything. It’s digital gold. It’s an old boomer coin. And we’re, you know, on the cutting edge of innovation, it can’t do anything. And so even if, you know, you don’t care about JPEGs, which again, I’ve never, I’m not, I’m not out on my platform saying flip this JPEG, flip it, I’m like, I’m here for the biggest idea.

1:17:11 The biggest ideas were, you know, around sound money. That’s a hundred trillion dollar idea. But that, the change that happened, you know, spring of 2023 was increasingly the last year was massive. And it was a ton of Ethereum developers, a ton of crypto developers that literally called Bitcoin dumb boomer rock came over to Bitcoin and said, oh, you know, we’re coming back to the mother chain, right? And there’s tens of billions of crypto VC that had zero spot Bitcoin.

1:17:39 They had zero Bitcoin holdings or zero Bitcoin companies in their portfolio realized, oh crap, I need to cover my ass. And so it’s been really interesting because we’ve seen a complete flip 180 from, you know, kind of all of this, the L2 stuff and all of the, you know, kind of experimental protocols and lending and borrowing and all that stuff being an alternative crypto to experimenting and trying to come to Bitcoin and build this, these sort of things. So can you build the trust, minimize lending protocol on Bitcoin’s blockchain?

1:18:12 Can you build it on a second layer? Can you build these L2s with a trust minimized Bitcoin peg? And so you have a whole bunch of people that may or may not fail, right? Like I think at 90%, there’s a bunch of second layers coming to Bitcoin. 95% of them probably are drunk, right?

1:18:29 They have their own token or they’re not really an L2 and they’re just calling themselves that for marketing or it’s not really a trustless or trust minimized. But I’m wholly for experimentation, you know, tweaking things, implementing things and, you know, trial and error because ultimately the core bedrock, the foundation of Bitcoin is unchanged, right? So if you want to spend Bitcoin on this JPEG, or if you want to spend Bitcoin, you know, flipping tokens or whatever, I mean, Bitcoin is FU money.

1:19:01 It’s permissionless, you know, nuclear grade money. I don’t care what you do. So I welcome it, right? I welcome the fact that a bunch of people are spiking fees to pay miners. I welcome the fact that miners are, you know, not paying more and more hash rates can be built out.

1:19:18 Bitcoin’s gonna be more secure because of a bunch of crypto people are now coming to Bitcoin. And it’s kind of always what I thought, right? It was like, well, we’re gonna watch Ethereum. It’s gonna be, it’s gonna do what it does for seven years and then anything valuable that can be derived from watching, you know, thousands of developers tweak and tinker and change Ethereum, you know, or Solana or whatever chain, we’ll take the best parts of that and, you know, eventually we’re gonna build that on top of the solid, strongest, most secure foundation.

1:19:46 And then at the core, the base layer of Bitcoin is unchanged. So I think it’s really fascinating. Again, I think a lot of it, there’s a lot of hype, a lot of speculation. A lot of it’s gonna, you know, if I go to zero, a lot of it’s gonna flop, right? But if there’s just one thing, right?

1:20:01 Like the Lightning Network for Bitcoin was kind of beta tested in 2017, 2016, 2017. It’s taken six, seven years and we’re still kind of in the early stages of this, you know, kind of network effecting adoption, right? So I’m all for the experimentation. I’m all for novel applications, right? And, you know, I would say be very careful on some of these things, but, you know, the developer interest in Bitcoin compared to a year ago is substantial.

1:20:29 And I think that’s a good thing. That’s refreshing to hear you say because I think a lot of people assume not that you are a maxi and I’m glad you kind of clarified that, you know, a maxi would just say, go away, leave my chain alone. And I would say some maxis out there, not to mention any names, Max Keiser, who’s been on my show by the way back in 13 and 14 and I know him and Stacy well, but, you know, they would just say anything but the purity needs to go away and these people need to go to jail.

1:20:54 And again, for me, it’s just nice if people can entertain the possible input of other things. And like you said, all that knowledge that was built up on Ethereum for the past 10 years is now being directed right back at the Bitcoin chain. And that’s incredible if you really think about it. How do you feel about Ethereum and Solana and everything on that coin market cap that’s not the top one, which is Bitcoin? Like, do you see things of value there?

1:21:21 Do you see the stablecoins of value? Or do you only see them as value that might come back to Bitcoin one day? Or do you think those are interesting and they’ll serve purposes that are out there even though they aren’t that quote unquote sound money? Yeah, I mean, there’s a whole bunch of people out there that are very excited to put real world assets on blockchains and stablecoins and build the traditional infrastructure of Wall Street on a blockchain. And, you know, I welcome them to try.

1:21:52 And, you know, I think, I mean, just objectively or empirically sending a stablecoin, sending USDC across the ocean is easier than a bank wire. Like I, you know, I’ve been shockingly few bank wires in my life and compared to sending a Bitcoin or I guess a stablecoin transaction, it makes me want to gouge my eyes out. So I understand it, right? But I think a lot of it, right? For the longest time, you know, in the ICO boom in 2017 or 2020 DeFi stuff.

1:22:23 And, you know, it was like, well, this protocol has a moat and it’s genuinely innovative, unlike anything else. And this is going to change the world, future of finance. Here’s our token. And really, like, they don’t really have moats and, you know, the tech is maybe novel, but the tokens are, you know, every token, whether even they pretend it or not is competing for monetary use. It is competing as a story value into the account and medium of exchange.

1:22:54 It’s competing against money and all money competes against each other in perpetuity. So I’m all for the experimentation, right? I’m all for it. But I think ultimately on a long timeframe, not a short timeframe, not one week, not even one year, but on a long timeframe, most all cryptocurrency is trending lower against Bitcoin because there’s a monetization path and there’s network effects that Bitcoin has that are going to continue to accrue and kind of the flavor of the month token, right?

1:23:25 Like, especially like the meme coins, right? Meme coins, I think, honestly, have been not refreshing, but in previous past they’ve been, well, this token’s going to change the world. It’s going to solve world hunger. This is the internet computer. And meme coins are like, this nihilism of like, no, the coin literally does nothing.

1:23:45 We’re just pumping it because we like gambling. And I think, you know, like, there’s obviously a use case for gambling, or not a use case, but there’s a, I’m sorry, a demand for gambling, right? Like FanDuel and DraftKings, you know, you walk anywhere in the States and you watch any sports game in the States, you get four casinos or sports book ads, right? There’s a massive demand for gambling. And is that a cause of, you know, fiat currency?

1:24:09 And is that nihilism because of the debasement? Well, maybe that’s a different conversation, but there’s obviously demand for speculation and meme coins and crypto tokens. Are they zero sum games on a long timeframe? Of course, every dollar that’s put in by someone is taken out by someone else. But I think people on the way up, right, are fooled when there’s a net inflow at a certain period of time are fooled into thinking that meme coins are positive sum, right?

1:24:35 Like the fifth dog token is not a positive sum game on a long timeframe. It’s completely zero sum and maybe even negative sum if there’s fees involved, right? So I think that’s just important to understand because again, I’m a freedom maximalist. You have Bitcoin maximalist, but a freedom maximalist. If you want to go, like I see someone on the corner store that buys lottery tickets every morning.

1:24:56 I’m not going to sit there and call him a moron and slander him and tell him that he’s financially illiterate. No, right? I’m just, he wants to buy his lottery tickets, right? Does he, maybe, does, has he done the math? Does he know what he’s doing?

1:25:08 Does he know we should be putting money in index funds? I don’t know. Is that my problem? I don’t know. So if someone wants to gamble on like the hundredth meme coin on Solana, I think they’re welcome to do that.

1:25:19 But I think ultimately at the real core of it, the core, the essence of it, Ethereum, Solana, every cryptocurrency end of the sun, is competing as money. They say, well, no, we’re not money, we’re technology. Well, you know, the blockchain itself, blockchains, you know, they’re like, you don’t need that token in the next 99.9% of the time. The token is kind of, is, you know, it’s a money without being maybe explicitly labeled as such. And so for that reason, you know, and again, I know a lot of people that are, you know, insanely rich from non Bitcoin crypto, right?

1:25:57 So there’s a lot of people out there that kind of chase, chase that dragon of, well, look, if I put a hundred dollars into a meme coin, that 10,000 Xs, I can retire, right? And I think, you know, that’s, that’s obviously, you know, there’s, there’s a financial nihilism out there, of course, right? Bitcoin’s already gone up, you know, I need to, I need to get rich. And I understand it, right? Like, I understand that people are, you know, attempting to do that.

1:26:25 But I think ultimately, again, at some point, like these aren’t positive, some games, they’re zero, some are even negative, some games. And, you know, when you buy the top, someone else is selling to you. So I understand what Solana does. I understand what Ethereum does. And I don’t doubt that when Bitcoin is ripping, you know, every cryptocurrency, I mean, you just look at it.

1:26:49 When Bitcoin falls, all these other crypto currencies fall. When Bitcoin rips, a lot of these pump. But on a long timeframe, don’t chart these in dollars, chart these in Bitcoin. And on a long timeframe, most every cryptocurrency on the planet, trends lower against Bitcoin on a long timeframe. So, I mean, that’s, that’s not to say that’s a rule, right?

1:27:07 That, that can change on a weekly basis or they could change next month. But, but most people you talk to in crypto, most, not everybody, of course, they’d say, man, I should have just literally bought Bitcoin and done nothing. I would have been, I would have had way more money than I do now. Instead of like, you know, flipping every token out of the sun, paying taxes every year, you know, losing money here, this went to zero, this got hacked, right? It’s just like, some people are good at, you know, juggling fire and some most really aren’t.

1:27:38 So I get it. I mean, I, I, I’m no, in no way calling for like, I’m not a status. I’m not going to say, you know, the SEC needs to shut this down, right? But I mean, just literally two, two days ago, three days ago, Uniswap Labs got a knock on the door, a quote unquote, like centralized protocol. Their CEO got, you know, a wealth notice from the SEC.

1:27:58 They’re getting sued, right? Vitalik, where the Ethereum Foundation deleted a code in their GitHub that says like, you know, that they haven’t talked to federal authorities, right? So like, they’re getting knocks on the door, right? And I also ponder people, you know, people should really ponder that when a, when a Ethereum or, you know, something like Ethereum, like Solana, has a $400 billion market cap with $100 billion of stablecoins, Tether, USDC, who are both in contact with federal authorities.

1:28:29 In the case of any consensus forks in the future, of which Ethereum is planning to do, and Ethereum is planning on changing its monetary policy again soon, they’re already talking about it. If you, if you map out the game theory, if you map out how this actually goes down, you have an entire, like the entire DeFi ecosystem, all of the applications, all the smart contracts, they’re all intertwined with these stablecoins, all of these protocols with their tokens. If, if Tether and Circle get knocks on the door from the US government and they say, you know, fork A or fork B, you have to choose fork B, sorry.

1:29:07 Is, is all of the Ethereum users going to choose, are they going to value fork A with their entire DeFi system imploding? And all of, all of that gone in a proof of stake network? No, they’re not. So the stablecoins and the real world assets on these chains, while in theory, it’s a really good idea in practice, essentially guarantees state capture down the road, which is fine, state capture is fine, right? You know, it’s also state capture, but the NASDAQ, right?

1:29:36 That’s fine. But for an apolitical programmatic monetary policy, sound money for the world, you don’t want, you don’t want state capture when it comes to consensus decisions. So the fact that Ethereum hard forks every, every year and can change their consensus and switches out proof of work to proof of stake and change their token issuance, that’s fine, right? It’s, it’s, it’s opposite of Bitcoin, but it’s obviously, Ethereum’s obviously done well since its inception, but it’s entirely captured at this point by the state, which is fine, right?

1:30:11 Again, like the NASDAQ is captured, BlackRock is captured. That captured isn’t necessarily a bad thing, unless you’re looking to build like globally political money. So, you know, that’s where I think like, is Ethereum a tech bet? Of course, yeah, it’s a tech bet in the same way Tesla is a tech bet. But Ethereum and Solana aren’t gonna become global money.

1:30:34 Yeah, that’s a really wild perspective. I hadn’t thought about that capture, but yeah, it’s a great point. And of course they are, whereas Bitcoin isn’t. You know, when I look at the, at the Solana meme coins, I kind of look at, at the component of culture that’s in there, that people are doing something they want to do to feel like they want to belong. Maybe they’re gambling, maybe they’re having fun.

1:30:54 Just like Trump’s, you know, true social, people want to buy it, maybe because they want to support him or feel like they are or show their friends that they are. And for me, these are mirrors on who we are as humans. And we could never look in these mirrors before because we never had these tokens that we could get in and out of. We didn’t have those before. So for me, it’s teaching us something about ourselves.

1:31:16 The other day I said, maybe you’ll take offense to this. I said, Bitcoin was a meme coin the first couple of years. And what I meant was, it was a group of kind of tech geeks or computer people that like to get together and talk about this thing and maybe trade this thing and be a part of this thing. And it was like a club. And I see, you know, board apes, same kind of thing.

1:31:38 You could say NFTs are dead or whatever, but it was people that want to be a part of a club and want to be around each other. And people clearly value that. Now Bitcoin evolved and now it’s this amazing thing. But when I see these things happen, again, I’m a freedom maximalist too. I’m like, let them do what they want to do.

1:31:52 But I think there’s more to it than we think. And again, the initial thing with all crypto was like a bunch of degenerate kids or punk kids that don’t know what they’re doing. But I think it’s actually teaching us something about humanity that we didn’t previously see. What are your thoughts on that, Dylan? Well, I mean, I agree with you when the Bitcoin kind of started as an e-coin and almost, I mean, some people may even argue it is today.

1:32:17 Yeah, Bitcoin wasn’t predestined to be where it is today. It’s not predestined to be global money. This is, I mean, this is because of individuals all over the world subjectively valuing that thing. But what I would say is, you know, when Bitcoin appreciates by an order of magnitude or goes from $1 to $100 in a year, and then crashes down, compared to when the 10th dog token does, or you know, Solana, Joe Biden meme coin, the physical infrastructure that is built out, incentivized by the price appreciation of Bitcoin is very unique.

1:32:55 So Bitcoin appreciates by an order of magnitude. There’s a massive direct financial incentive to turn energy into Bitcoins. So the fundamentals improve because of speculation, but that speculation and, you know, trading, the generosity and the bubble actually turned out to improve the fundamentals to the point where a Bitcoin crashes and now it’s under priced relative to its fundamentals. It appreciates by an order of magnitude. The speculation far outpaces the actual, you know, strength, security, decentralization.

1:33:28 If you want to think of a fair value of Bitcoin, then you can look at a whole bunch of on chain metrics. It really outpaces that out guns it and crashes, but now the fundamentals, the strength, the physical infrastructure are far, far more, you know, stronger, strengthened by that speculation. Whereas, you know, the dog coin or the Joe Biden coin, right, like they appreciate by an order of magnitude, but there’s no physical infrastructure. There’s not, you know, there’s, it’s kind of like the zero sum game.

1:33:55 So I agree that, I mean, Bitcoin is subject to the whims of financial speculation, of course, right? There’s, you know, there’s derivative exchanges where I can get one Bitcoin collateral and put on a 50 Bitcoin long position, right? Where if it goes up or down twice, if it goes up or down 2%, I double my money or I lose it all, right? That’s speculation, of course it is. But, right, there is a positive sum game at play here.

1:34:17 Whereas with the meme coins, and this can persist for a long time, right? Like Dogecoin went to an $80 billion market gap. Dogecoin was literally worth more than Coinbase. When Elon Musk went Coinbase, a real business, real physical infrastructure, a couple thousand employees in 2021, Dogecoin, when Elon went on SNL, was worth more than Coinbase, right? Like, is that, is that real?

1:34:38 Is that result in anything? Or, you know, did a bunch of people cash out in the exchange rate crash 90% now? So, I don’t know, I, again, nothing, I’m not gonna sit here and saying like, these darn kids, right? Because I don’t care, it doesn’t affect me in any way. But what I do think is not great is when, and I posted this, I remember this vividly, I have a screenshot of it in 21, is I got, I was getting multiple notifications from my Coinbase app to buy Shiba Inu at literally the Pico generational top of Shiba Inu.

1:35:11 I don’t, you know, whatever the market gap of the second Dogecoin was. And so, you know, when my friend that I’ve been telling to buy Bitcoin for two years, who hasn’t, gets the notification from the number one crypto app to buy the Dogecoin at 0.00001, you know, and they can get a billion tokens for, you know, 100 bucks. Like, that’s where, you know, ultimately the meme coins do have, you know, some second order effects that aren’t positive. Right, it’s a seemingly positive, some game that’s not, right, and eventually people get burned when it all goes bust.

1:35:48 So, that’s, you know, I agree, like it’s Bitcoin itself has been medic, the virality of Bitcoin, the network effects of Bitcoin are self-reinforcing, but at the same time, you know, there’s all sorts of speculation, there’s all sorts of, you know, juggling hot money and screaming into the void on Twitter or going on podcasts and calling people names is gonna stop anything from happening. So, I just do my best to, you know, put out a bit of information and then completely understand that this is gonna happen regardless of what I say or do. Yeah, well said.

1:36:19 Dylan, what’s next for you and what do you think you’re actually doing 20 years from now? That’s a great question. Well, what’s next? A lot of really interesting stuff in the works with some Bitcoin adoption, you know, by some kind of bigger names and I’ve been having a lot of great conversations still with doing some stuff with Bitcoin Magazine, doing some stuff with UTXO management. I got my YouTube channel, which I’m gonna have three episodes in, so nothing crazy, but I’m gonna be putting out, you know, weekly episodes, kind of like a live stream, kind of off the top format.

1:36:56 But, you know, I think it’s gonna be a crazy 12, 24 months ahead and we don’t really, you know, we can’t really comprehend just how, you know, we think in linear terms, we don’t understand how crazy this whole media cycle is. Like there’s no one paying attention to Bitcoin’s at all time highs right now, which is just nuts. Last time Bitcoin was at $69,000 and it was all anyone talked about and it was on the news and now everybody’s silent. So I think that’s, you know, it’s gonna get really crazy, but yeah, and then it’ll crash 50, 60%, but we’re not there yet.

1:37:28 And 20 years from now, I don’t know. I mean, I’ve, you know, hopefully making the world a better place, but, you know, I love numbers, I love problem solving and challenges. I imagine something to do with business, but, you know, I mean, I was first originally really interested with investing, like Warren Buffett value investing principles. And I realized, you know, after some deep study that value investing is dead in a world where the ruler is broken. Yeah, when, you know, there was no value investing in Weimar, Germany.

1:38:01 There was, it wasn’t that. The value investors took as much debt as they could and shorted Marx and bought gold. You know, so there was no value investing in a hyperinflationary regime. It was the same as an inflationary regime. There’s no value investing.

1:38:14 Value investing’s underperformed for 15 years straight. And then the value investors still don’t know why. So, I mean, I presume, you know, once I, in my opinion, Bitcoin is, you know, an order of magnitude, two orders of magnitude higher than it is today, more valuable, more liquid, that value investing will make a strong comeback. And I, you know, I’ll probably try my odds at that. But yeah, I don’t know.

1:38:40 I’m still figuring it out. To be honest, I’ve kind of just not been winging it, but, you know, I’ve kind of stumbled into the past few years and into all this. And so I would like to say I had this grand plan, but really it was kind of more of just an obsession that turned into where we are now. So I don’t know. That’s a, you know, I need to think more on that, but it’s a great question.

1:39:02 Well, you’re clearly getting to the right places doing what you’re doing. So I wouldn’t change that up too quick. How can people follow you on YouTube and on Twitter? And is there a website or what’s the best way for people to learn more? Yeah, you can find me on YouTube at Dylan LeClair.

1:39:18 I think Dylan underscore LeClair, but if you look up Dylan LeClair Bitcoin thesis, I think it should be the first episode. It’s just a, it’s my profile picture, just about that shot in black and white. Maybe I had to do some more like SEO optimization there, but you can also find me on Twitter at Dylan LeClair underscore. I’m kind of doing a whole lot of stuff, publish some analysis, you know, we’ll have some really cool announcements later. I think these next couple of weeks, if everything goes well, and yeah, I really appreciate you having me on Brian because we had some great talks in Dubai.

1:39:53 Yeah, you caught my eye with the suits and we took it from there, but now this is really exciting and I’ve, you know, I’ve caught some of your episodes in the past, so it’s a cool experience. That’s awesome, man. Now, a huge fan. I think you’re one of the more important voices in Bitcoin and just keep doing what you’re doing. Again, people can feel that they should listen to you.

1:40:13 That’s what I always say and that’s why I was really always been attracted to your stuff and it was great hanging out and I love the fact that you’re doing these YouTube pieces. I’m telling you, you’re gonna keep doing those and it’s just gonna take, it’s gonna take you on this beautiful adventure like this has for me. I mean, for me creating content, I never thought I’d be sitting here wearing a suit, talking to you, but it all started with weekly episodes, not knowing where I was going.

1:40:36 So by the way, I give that advice to anybody listening as well. I think just broadcasting yourself changes your life because it makes you kind of bring the best version of yourself forward, makes you do things you’re scared of, makes you also stream the days you don’t want to and those are the days you actually get the best content, funny enough. It also gets you introduced to the right people and it puts out great energy to the world. So I recommend everybody do that.

1:40:59 Dylan, really appreciate you and looking forward to more of your content going forward. So thanks so much for being here. Thanks Brian, appreciate it. All right, fantastic. Follow this man here and we’ll see you next time on London Real.

1:41:11 Take care everybody, bye.