Debasement Endgame: Bitcoin ATHs, Gold Near $4K, & Bonds Bleeding

It all comes down to computers communicating. The information superhighway can be a confusing mix of on ramps and off ramps. Bitcoin is worthless artificial gold. Is it still rat poison? Probably rat poison squared. We need to get into the world of OK, this is actually foundational technology. What the Internet of Money does is it creates a single network which can do a microtransaction to a giga transaction. The Internet is going to be one of the major forces for reducing the role of gun. The one thing that's missing that that will soon be developed is a reliable E cash. Hey everyone, hope you had a great weekend. We're back for another episode of Final Settlement on a great Monday. With the price of Bitcoin over $125,000. I believe it hit its all time high this morning. We have an awesome episode. I hope you make it through the full podcast covering everything from Galaxy 1's new launch to Morgan Stanley letting advisors offer 2 to 4% allocations to their private clients. Talking a little bit more about, you know, venture themes and how in future way it'll be the only logical thing for asset managers, allocators to benchmark against gold or Bitcoin given the status of the dollar losing purchasing power by 50% in gold terms just this year. Hope you enjoy the podcast. We're going to be out in Dallas this week. We're going to host a few happy hours, private dinners. So if you're around the area or thinking about making the North American Blockchain Summit, please do. We'd love to meet. If you're looking for tickets to the conference, I think we might have a few extra. You can shoot us a note. We've gladly set you up. All right, hope you enjoyed the podcast. All righty gentlemen, welcome back to another episode of Final Settlement. Today is Monday, October 6th, 10:14 AM Eastern Time. Q4 boys, especially in the Q4 and we're breaking out. We're breaking out right now. Gold's at like 4K. Bitcoin is, is is making all time highs as we speak. I'll pull up the on ramp terminal right now. 124 nine. It was just that 125 three or so a few moments ago, but we are breaking out boys. How are we doing? Pretty crazy. I mean, I think this is, I think it's crazy that they're both together and the, the sentiment shifting. I think this is kind of the discussion we had for the past few months on this what what caused a like secular change If you had it in the market sentiment that they were just getting fleeced, You know, gold bugs and individuals have known this and definitely Bitcoin investors for 15 years, but you know, the rest of the world hasn't. And if that just becomes part of the narrative now you can click a button and get a form of digital gold. It's pretty interesting for demand side. Yeah, absolutely. And, and you know, I think over the past several weeks we've talked about it a bit on this show a lot on the last trade, but this notion of the debasement trade is, is now very much in the zeitgeist. You know, there was some headlines for Morgan Stanley, which I can pull up, but other sort of incumbent Trad 5 players as well, talking about gold and Bitcoin in, in a light that, you know, historically they haven't, you know, historically when you think about Trad 5 firms, they, you know, if they have exposure to something like gold, it's, it's 2% sort of at most sort of a disaster hedge in a portfolio. And that line of thinking is just fundamentally changing over the past really months and as gold's been making this move. But what was once sort of a 2% allocation is now, you know, anywhere from a 20 to a 25% allocation recommendation from a lot of these types of firms. And, and naturally, as, as people come to gold and understand the pieces around protecting themselves from the basement, the natural evolution is to to understand Bitcoin as digital gold. And I think we're still early days of, of that, like of the trade. But you know, this is something we've been watching and, and talking about it, you know, for a while is just looking at the performance of gold. You know, typically, you know, Bitcoin catches up in in somewhat of a lagged fashion, but but moves harder and faster once it does start to move. And we might be seeing the first couple stages of that, you know, right now over the weekend and, and into today in terms of Bitcoin sort of catching up with what gold's been doing over the past few weeks. I mean, gold is gold's up over 50% this year, year to date. And now I think Bitcoin is around 33% or so. So the two, you know, 2 top performing asset classes globally, one and two, pretty remarkable. And I think this is again, still early days of people waking up to this. But you know, as you have the Morgan Stanley's of the world, the Goldmans of the world coming out and saying similar things, this is just going to continue to permeate. Yeah, I mean, I think this is a solace you find in in a in a trade like this, in an industry like this, that it's just technology. Money is just technology. And at the end of the day, you can't force technology back in a box in the same way you can't force, you know, gravity in a way you don't want it to. That we it's not apples to apples, but we saw this play out with Blockbuster. We saw this play out with Netflix, and we're going to see this play out with the largest institutions in the world that were historically staunchly against this asset have to come around. It doesn't even necessarily matter because of, you know, quote UN quote what the market sentiment or debasement. It's like really just a client demand and if those clients assets are going to leave and the demand also comes from, you know, the, the fact that the currency is being debased. But it's similar what we we see with Vanguard's. So that's the beauty of this. The way this all goes is doesn't matter if the the institution's adopted or not, like, you know, Morgan Stanley, 7 trillion in assets under management, if they want any chance of those assets to stay there and then honestly grow in dollar terms, because that's what these two assets are going to be some of the fastest horses in the next decade. Well, it makes complete sense to put them in that. The kicker here, because I want to continue to try to bring this back to the business and opportunity side is that a this I'm fairly confident that institutions like Morgan Stanley and Visa and Amex will be able to offer better products than the first versions of what we've seen in Bitcoin and digital assets, meaning because they have better distribution, better branding, better design. But I don't believe they will win the second version of anything digital assets, Bitcoin related, meaning that world class entrepreneurs that come at this space from a native perspective will run lapse around these institutions on a long enough time horizon and it has nothing to even do if they don't have the right people, because they don't have the right people, they leave to go start the other firms. But it's really because there's too much inertia in their existing $7 trillion in assets that they can't actually compete. It's innovators dilemma 101 and that's really where the big opportunities are going to lies. How do you lay sound assets and the next to stable coins integration's best in class financial services around counterparty risk? There's a huge opportunity there and we'll this will tie into some other announcements that came out just today, but I know Liam probably has some thoughts. Yeah, 100%. It also is shifting the entire dynamic right now because Morgan Stanley wouldn't say 2 to 4% in Bitcoin and gold unless bitcoins volatility had come down a little bit. It's not quite as volatile this entire cycle as it has been in the past. We can talk John, everything BlackRock ETF related, but now that's top 20 ETFs in the world. The open interest on the ETF is bigger than everything on Darabit too. And so just the amount of hedge funds that just want to just make money straight off the volatility and any compression and spreads that's going to continue to make this asset class less volatile, which will relates directly back to the Morgan Stanleys of the world, Because while they do get paid on a UM and of their clients, they also get fired if the draw down is too large. And that's why you've seen any of these types of advisors be willing to put their clients into long term government bonds that they know will go down over time for and be negatively yielding in real terms. They're just more willing to open up the aperture to Bitcoin and gold relative to just these, the long term bonds. But yeah, as as you mentioned, we'll, we'll touch on this a little bit later, but everything BlackRock related, like they've had extreme success getting out of the gates because everybody knows who they are. They're trusted right now. And you know, a lot of the Bitcoin native companies just aren't. But yeah, it's a, it's a good transition into the Galaxy 1 because there's a lot to touch on there. Yeah, we can. We can move to Galaxy launching Galaxy 1 maybe just before we do that though, is it? Michael, I think you bring up a good point around, you know, how businesses react to this quote UN quote trade and the recognition that, you know, hard assets are are now you know, more in vogue than probably they have been in 40 or 50 years. And what does that actually mean for a business, an incumbent? I mean, on one hand, it means you should probably be storing some of your balance sheet in either of these assets, gold or Bitcoin, but it also means you should be offering them to your clients. And so, you know, we've seen some early signals of this, like with Cantor coming out with a gold Bitcoin product. I think there will be more of that certainly. And I guess, Michael, the question to you is like put a finer point on what you mean, what you meant by like, you know the sort of V1 of these things may be 1 by the incumbents to the V2 may look somewhat different and be 1 by more Bitcoin or the native firms like what is the V1 look like I guess in your mind? Yeah. So I guess like if you go back to anchoring contextual as well, what is that even? How do you know? Right. Like what are you talking about? It's like, well, if you go back for 10 years, who were the first people that adopted digital assets and it was none of them. They just had no view in it that no, no way they want to express it. And it was obviously coming, but they, they were behind the 8 ball. And naturally as the prices ticked up and the demand has come, they've said, OK, well, we get somebody wants this. And well, again, the more sophisticated people like the Ray Dalios and others probably are have larger percentages from risk 1 to 3%. Most of those advisors believe that's all it is. It's a risk asset. You're probably going to, you know, cycle out a rebalance and the point being is the V ones are going to be building exactly how the traditional market was built with, you know, omnibus is a great example. The insurance policies that manage it, not allowing delivery, maybe allowing delivery, but then having to figure that out just like the, you know, rehypothecation collateral. And so that's really where you got to pinch yourself. If you're listening to something like this and building, looking to invest is well, it's just natural. If you're holding a material position in Bitcoin, doesn't matter if you're love Morgan Stanley, BlackRock or Fidelity and it grows to 10 to 25% if not greater, well, why like on hell would you? Why in hell would you trust them in an omnibus wallet to just leave it there? And it's not that you don't trust them, it's just that can you afford if something happens that you don't get that that asset out? And so that's really where the multi institution comes into play and then lending against it as well. There's just going to be native properties that come across that and then you can start to think about the big gap. I think then if we're right is that this notion that there's 21 million of these things, there's much less than that. And if that's going to be a base asset next to gold, then you're going to want the integrations and custody to be tightened into whether you are cross collateralizing, lending against it, getting access to gold dollars. That's not how the existing plumbing works. It's not how they even want it to work when you think about a traditional 6040. And so it's just ripe for disruption. And to just make the last point is to your point around like Trifi's whole game is, you know, net interest margin holding the asset rehypothecation. You know, the fact of like multi institution as the easiest example for them to say, oh, hey, like we're not going to be able to have unilateral control and everything that goes into it is just a very hard thing for people to swallow. Now, I believe over time they will just how they had to adopt Bitcoin to put it in a 2 to 4% position. But that's the beauty of building right now and knowing these things, so hopefully that kind of outlined it a little bit better. No, that was great. That was perfect. Liam, any other thoughts or you guys want to move on to the Galaxy deal? Oh, is that for me? All right, Michael, I'm going to hand this one to you. Galaxy launches Galaxy 1 platform. I think Coinbase 1 is also a thing. So they could have done a little bit more more creatively on the naming convention here. But what does this mean? What are the here? It reminds you of the flicks where you like the the the scripts get leaked and there's like different shows that kind of like start resembling other shows. They probably like somebody was working on it quote UN quote first and the other ones like we're going to get it out. So Galaxy one, yeah, they launch their platform. I think there's two aspects for me personally that were interesting. Galaxy just seems to really be executing at a very high level. They seem to really potentially being one of those firms that hits the intersection or convergence of trad Phi and the digital asset space. Part of this launch had, you know, premium yield accounts for high net worth investors, access to interesting products to start gold, Solana, Bitcoin and I think Aetherium and it's effectively their first kind of product out into the retail market where they've been traditionally been institutional players. So between that and then just their natural like cycle into AI, they, they were holding a lot of bags when it came to when it came to power production. They really, I think their stocks taking a huge boom to that, given that they're now, you know, AI, they're managing AI compute. The other thing is goes back to probably most relevant here and then we talked about just a second ago was just the notion that we're going to see this cycle out of trad 5 firms that are naturally going to have to start offering digital asset native services and then the in the other side of it. And they're going to be doing it via building vertically integrated themselves or partnering with others. And then there's going to be the other side of that, which are digital native firms that are going to be integrating more trad FI products like this 8% APY. And I think about that a lot in the context of like what we're building at on ramp. And there's just the notion of people generally want to have a unified experience when they deal with their financial life. And so I don't think there's a one-size-fits-all. It's just going to be an interesting model to see kind of where the the winners end up on a long enough time horizon. Yeah. I mean, what do you make of this this yield product though? I mean, generally I've been conditioned to think skeptically about any, any sort of yield offering. This says high income investment note offering 8% APY, but only to accredited US investors. The yield is powered by Galaxy's institutional lending business and unlike 4% cash account, it is not at the Inc in short. So a ton of detail on how they're generating that 8%. Well, there's a couple things like 1 is it's dollar yield, which at least gives me a little bit of less of a pause because it's dollars. So like, I mean a like there's a lot of ways to get 8% yield in dollars. But also Galaxy's been around the block. They've managed lending markets where you know, have a good lens into their work that they're doing with Arch and they're very pretty conservative. So the point being is that, you know, Arch as an example, offers over collateralized loans They get, you know, anywhere between a call it, they charge anywhere between call it roughly 10 to 12% spread Galaxy, you know, invested that or partners gives them call it 9 cost 9, they give 8 back. Just throwing out numbers. These aren't actually, but you see where I'm going with it is there's a lot of investors that naturally don't want long exposure to BTC. The other thing that's just a more meta point to 8% yield is I wonder how far I'll throw this back to you guys, how far we are from just the notion of anybody passing any kind of dollar yield without denominated. And it's something else whether it's gold or Bitcoin persists or lasts for because I've been thinking more about this in the in the context of venture and obviously we're Bitcoin denominated and we don't make money unless we return Bitcoin to investors. But if you think about today or a year ago, somebody raises a fund and let's call it whatever the, the number is, it can be 10 million, it can be $100 million, Well, $100 million. You know, how much Bitcoin does that buy you today? Is that 1000? I think BTC roughly, let's say it's at 100K. And so in, in just ten years, conservatively, I think we'd all think it's a, you know, $1,000,000 BTC. Well, that's a billion dollars, you know, in U.S. dollars you have to return in, in Bitcoin terms, you have to return that Bitcoin. But the real point is that what does the dollar look like? So the dollar, if it's already losing 50% of purchasing power to gold in one year, well, what does that look like in 10 years? And how are people in the same thing could go for a micro example, which is on an 8% APY, like that's effectively kind of inflation rate. So you're putting your capital at risk to the point I think Brian, you're making was like, why don't you just buy the Bitcoin? And now obviously we're still early to that, but I don't think we're like we're starting to get closer to this realization of like the risk quote, UN quote risk free rate if you can get custody right, ends up just being holding the underline, which has been my whole reason why the debt thing doesn't make any sense because you're just putting all this capital at risk for execution risk versus just holding the underlying thing, but hold the more of it because everyone's still under allocated. Well, yeah, I mean, that's a really good point. And where my mind kind of goes is like, you know, I don't think we're there yet, but I think as this continues to play out over the course of the next few years, I think there will be a recognition that like the 8% yield is not enough, right? And and then that will cause, you know, moving out the risk curve even further to offer even higher yields on these types of products or, you know, other, other mechanisms. And so that's, that's what I would see occurring is like there, there will, there will be a recognition that like, you know, if the debasement rate is 7 to 12%, then, you know, clipping your 8% yield on whatever, you know, product or service you're going through is, is just not going to be enough. And then that'll force other people to, you know, offer 12 or 15 or 20% yields. And we've seen like little sort of micro instances of that in, in more of the crypto specific world where, you know, you have all these protocols where people do yield farming and you get 50% AP wise. Like I, I, I think I expect some of that type of mentality and thinking to blend over into the Tragfire world. Once people realize that, you know, it's very difficult to compete with. If everyone's offering, you know, 5 to 8% yields, there will be a natural incentive for people to offer something that's a little bit higher risk and, and, you know, could offer an even larger, larger, larger yield. But that's just kind of where my mind goes with it in terms of, you know, how this could progress going forward. Yeah, people don't know how to underwrite that. And that's where all this the, the kind of natural deleveraging comes from. I guess the the second part to that and curiously yours thoughts on for easy math is like you raise 100 million and you deploy it and you know, you hit a 3X. So you, you know, get net return, call it 300, four, 100 million actually net of fees, you're definitely way lower than that. But point B is like, let's just say it's like that a billion dollar or $1,000,000 Bitcoin, that's 1000 BTC, but that's actually like closer to .3 BTC. Your return. It's only like 300 of that Bitcoin is just like the, the, the math people are going to start to do on like why don't I just hold this underlying thing? They're just curious how far you think we are from that. Well, I think we're, we're going to be pretty far from that from the majority of people. But if it always happens at the edges, like just like Bitcoin was proliferated by just the individuals adopting it, those who adopt Bitcoin from their personal balance sheet are going to start thinking, OK, well, if I start a business, I want to get more Bitcoin with it. And that's why I'm going to make my internal hurdle rate actual Bitcoin. And then that will end up going out to other investors who are considering investing in venture versus just holding the Bitcoin themselves. It's just broken at more so the company level than anything else, which is why we go back to this 8% APY and many other people out there trying to gain a few basis points on their internal cost of capital rather than understanding that the end goal is either more Bitcoin or gold, if that's what you prefer. But. At the same time, there will be many different pension funds and long term capital who are going to be extremely far away from that. And they're going to look at Galaxy's premium yielding 8% APY and think, hey, this is interesting. There's obviously some some risk involved, but they can, you know, make some arbitrage play on whatever and they're going to think that they can pick up a few free dollars on the floor ball at the same time that they're just missing the fact that the entire trade is just how much Bitcoin can you really get on the other side of things. And the dollar is going to have so much more debasement between the next now and the next 10 years. And they're going to be kind of picking up pennies in front of a steamroller. Well, how about this? So 1 is what if they don't necessarily have to? No, because I know that's pretty hard for a lot of like individuals be like, well, I'll try to get more Bitcoin. That's the game. But it's what if they're just trying to get more dollars, which they are, and they come to the conclusion that Bitcoin is just a proxy for net dollar expansion. And so the way of working into this is because it's interesting, a lot of people be like, well, there's no way you can return more Bitcoin. And then like the funny joke is, well, you can if you don't try. And what I mean, no, but seriously, because what I mean by that is, well, you can't actually return more Bitcoin if you have a, a venture for dollars, because inherently you've baked into it that you get money if you return dollars, not Bitcoin into it's like, well, on our side, we don't want to make anything unless we turn Bitcoin right. So then you already put the incentive on the right track and then you're basically putting your money in your mouth is like you get your money back and you're going to get some proxy of Bitcoin, which is going to be much more than the dollars. And So what I'm really getting at is how far does it take for the market if we believe this debasement trade is happening and people are going to wake up. And again, it starts with the at the edges, but it'll be individuals start to demand from their GPS and other fund managers. You have to benchmark against gold or Bitcoin had some respect. And it's like, because those are proxies for dollar liquidity. And I need to make sure that I can't just go and buy those because I could just go buy those outright, which is going to be beautiful because that means there's going to be much less asset managers in the world. And there's also going to be a lot more efficient capital allocation because the second that happens, you're just like, well, shit, I got to make more money back. Now I know this is probably like, you know, wishful thinking and probably have a long ways to go, but that's the beauty of like where we're at is it's just rational. This stuff we were to talk about the gold Bitcoin thing for a few years. Now it's coming to light like this will happen because it's just a rational thing for an investor to do is to demand more of the thing that gives them more purchasing power versus less. And and then even if somebody says, well, I'll pay dollars, they can't return bitcoins. Like we'll just benchmark against Bitcoin and then return the dollar still, but don't get paid unless you outperform. And they're like not I can't do that. This is the. This is a beautiful thing because it's exactly how we talked about with essentially Morgan Stanley trying to adopt Bitcoin, but it's going to cannibalize all their existing businesses. So it's not going to be the Super large incumbents who just recognize that the entire way that they benchmarked all their funds was actually a flawed model and having to explain that to a very large swath of investors that already have invested in saying, hey, we actually did this wrong. And so naturally it will be the relatively, you know, ones or twos at these bigger firms to try to get their firm to adopt it because they know at the end of the road, like every individual is going to want to demand these things. And they're going to, you know, not demand it or not adopt it because it will be an implicit admission that their entire business model is wrong. And so the people will naturally go out and start their own businesses themselves. And so that's essentially how this is all going to happen. It's going to be the very and there will be LP's that demand it from their general partners too, but the partners have no incentive to admit that everything is flawed unless they're actually starting to lose capital. I think very few are going to commit it before they actually see the problem. It's kind of just like the entire debt situation that the US is in too. This is the true Wild West in my mind. Like if we had to go back, right, like the people staying in Europe and they're like, no, everything is fine. It's it's great. We'll like live under serfdom. And then there's people that like, fuck it, I'm going to America. And then there people like fucking, I'm going further W there's like there's no rules. Everybody is open to new things and then we're going to like make it work. And some people died along the way and some people had flawed models, but the ones that end up making it, there's a whole world on the other side of that. That's like effectively where we are today. And why I say that is because there's so many people now waking up with the quote UN quote, debasement trade where all this stuff was taboo. Now you can start to find your cohort. We find them, they come in, we invested in them there. There are LP's of like, wait, this just makes rational sense. It's like I've been investing them and saving money and I know there's things out there that need to be built, but people aren't building them the right way and it doesn't look right. It doesn't look right that people are going to hold these plastic devices spread across all over the world. Doesn't look right that like people are selling lightning or other merchant fees, but nobody's spending. It's like people just need infrastructure. People need access to gold and Bitcoin. People need like these sound products, they need to be able to lend against it based on where we are today. So, Wild West, Buckle up. I mean, I would agree with William state that like you're not going to see a, a full embrace of this from the trap I folks, but what I would expect is like people to spin out as, as you kind of alluded to. So like I, you know, if, if this continues, right, and let's say Q1 next year, gold's at 4500, Bitcoins at 1:50 or 200. Like I would expect to see some, some more boutique shops, not, not the big names not being comments, but like boutique shops, spin outs that are denominating in, in neither gold or Bitcoin. I do think we're not too, too far away from that. Over under 12 months. I was just about to ask you. That under, under, I think under because I think this is going to accelerate the the debasement trade will accelerate through the end of the year. And I think people will start waking up to not only that, but what I'm going to pull up now is this is the year to date performance of of major hedge funds. They're all underperforming gold by like 50%. They're all underperforming Bitcoin, Bridgewater, pure alpha. Yeah, go ahead. Sorry, one thing just before we transition to this, this was the whole pitch around why we're like is in a great spot is the debasement trade or if you're going to denominate your firm specifically venture capital in a harder money isn't happening in a vacuum, meaning like the companies actually have to have unit economics, they have to do things. And so the point being is that not everyone can do it. It's like you, even if they could transition and spin out. So this is where a lot of the interesting angles will come from, from our set of like if you just build a firm that has a proxy for higher discernment and efficient building in the new world where there's a cost of capital that's above, you know, basically printing dollars, you're going to be in a very good position independent of returning the BTC you can hit. You know, our benchmark is 1.25. If you get 1.21, you're still going to outperform every other firm. And then all that liquidity isn't going to naturally come to you. These are like, well, wait, you actually understood this. You, you who to hire, how to think about building in a world where there's no free capital is I think the last part on that just like exciting part. As long as we can make our stuff work. Yeah, 100%. I mean, if you just look at this and you know, let's say hypothetically, you know, we didn't mark up any of our business in our portfolio. We returned 1X Bitcoin at the end of this year, we'd be outperforming all these top hedge funds like that. That is the moral of the story here is that if you just hold a denominator in a, in a harder form of money, you know, one, it makes you more discerning, which is the, the real critical part. But two, you can, you can outrun all of these Fiat denominated people that are just playing the wrong game. There was a few other Liam, I don't know if you had anything else on that, but there was. No, I would just say the IT all goes back to the incentives. And you know, you can talk about sharp ratios and Sortino ratios all day and how you're the best performing at all those metrics. But at the end of the day, what most people really just want is more dollars and more Bitcoin or more hard assets too. And that's why chasing these wrong metrics and being evaluated on all these wrong metrics is just going to drive worse outcomes. And you know, being in a dollar denominated world is just inferior relative to living your personal life on a Bitcoin standard as well as all of your investment decisions. And it can be gold standard too. But it just, the world is kind of very, very slowly waking up to that. In the last part on that is don't let anybody convince you people can't return more gold or Bitcoin to you though. It's like a very Fiat take one because money's meant to be spent, but 2 is we got so far away from delivering value as a society that people literally lack the imagination of how to deliver value that can make more money. And that's where the DAC craze again comes into play. It's a lot easier to financialize Bitcoin versus just provide goods and services that individuals need and then to charge a nominal fee on it. Like that comes up a lot to how can you make more Bitcoin? It's like, well, you can provide value to the world and then they pay you for it and then you give it back to your investors. It's not like rocket science, but there's some version that people like we can't return more Bitcoin. It's like, yes, I can, I will, and I'll show you. It's just a very, it's a very like the world's gotten very crazy that that is actually even something you have to discuss. We're going to have to put some research out on this because it's a great point. And when you think about the world and a state where we're eventually under a Bitcoin standard, there will be the value of your savings will actually just be a proxy for the productivity of people in society and the outcome of all businesses and people getting more efficient over time, which, you know, they should. But if nobody actually does anything and they just say, OK, I'm going to sit on my Bitcoin the entire all of my life and just sit at home and play video games or do whatever. The money will actually become less valuable over time because there will be less production of goods and services into the real world. And so the value of your savings will actually go down rather than increase. If nobody actually goes out and produces anything, the net economic output will decline. And that's not to say that you have to go out and do it yourself, but it's just a like a framework to view the entire world under. And you know, it would be more valuable outside of time than than Bitcoin in that world is your reputation. So like, that's how you get the money. And that's how you get like right now when you have dollars, like their accountability doesn't exist. Think about how many like founders started companies, whatever started another one left the VC firm started another like underperformance. Like it's all this hidden on this like haze of like nominal versus real. That's actually, I know we want to probably transition, but that's been the most interesting thing is for two years we've been really talking about nominal versus real returns and how it's been masked. And that's what's come to light in this debasement trade is people waking up to the notion of nominal versus real. And we need to come up with easier ways to understand it because it's not that hard. But it just sounds so like to the normal person, it's just like the thing that lets you buy more goods and services versus the thing that doesn't anyway. Right. Yeah. It's like the concept of nominal sounds more confusing than it is, but it's just like you, you're, you're denominating the thing that's being debased. So it's not real, like it's literally not real. I wanted to sort of jump back to a track that we were, we were kind of on this before with, with the Galaxy 1 deal. And, and what we were talking about was both sort of crypto native firms and the incumbents sort of trying to bridge this gap. So another example of this I, I would say is this finance announcement with you, which you brought Liam finance to offer turnkey crypto as a service solution for trad institutions looking to offer trade in custody and compliance. So this this sort of just reminded me of the Galaxy 1 deal and, and sort of the, you know, another example of the crypto native firm trying to bridge the other way into into trad 5. Hey everyone, hope you're enjoying the show. Just want to give a quick word from on ramp. If you're not familiar, we have an incredible new institutional line of products that have come out, including fundamentals research series that Glenn Cameron, our head of institutional has been working on What highly suggest taking a look at it, sharing with, you know, whether it's peers in the space, friends and family, as well as if you're an institutional allocator taking a look, it's really foundational stuff about what gives Bitcoin value, total addressable market. Well, how it works really great, you know, content that meets the the middle between institutional allocators and the type of research and Polish they require, as well as the understandings from a Bitcoin, you know, centric lens. This also applies to just net new holders that you've been trying to educate in the space. On ramp trade offers the lowest fees in the industry. If we ever don't, please let us know. The main reason we can do that is because we offer other financial services outside of just you know, buying and selling Bitcoin. Specifically, our multi institution custody offering would encourage clients to check out or prospect of clients. It's a great offering. You can find it on our website at onrickbitcoin.com. On to the rest of the show. Yeah, Coinbase is doing the same thing and it will probably as AV one be split kind of East versus West on who adopts these types of services. I do think it, I wonder what the economics of these types of deals look like for those institutions that are adopting like finance or Coinbase is crypto as a service type business? But at the end of the day, it's going to more than anything, these firms who haven't built it themselves should ultimately do these types of aspects just because the data feedback from their clients is going to be really interesting as well as getting a front row view of how finance and Coinbase actually operate. It's not going to be perfect. And those those firms we know are not and we can discuss that a lot, but at the end of the day, they need to start understanding where these how these customers interact with the different products and services, what what they really want and need. But for a V1, they there needs to be and there will be a lot of adoption of these types of assets just because it's going to take a lot of these legacy firms years in order to build it themselves. And they're going to have all these competing priorities internally of why this should actually take additional manpower and skills and capital away from their existing business, which is net making money. And everything from, you know, quarterly reports on how how much revenue and free cash flow companies are bringing in versus actually going out and spending a ton of money in order to develop something new, which is uncertain how much market share they'll actually get. It's the incentive will probably just be pay a little bit more upfront and rather than trying to develop it in house and have all this negative free cash flow for a long period of time if you already have a sustainable business but operating in predictable free cash flows. Yeah, Yeah. I don't know. Brian, did you want to share with you a bit and jump in? No, you go ahead. Yeah, I think that's right. I think this is an interesting model for intermediary, but between and probably pragmatic versus build or buy, because I think Fidelity has been a good example of this where they played a longer game and how to build a lot of the institutional inertia knowledge on how to, you know, develop wallets and offer goods and services. And they're still probably very far behind something like finance as far as like omnibus and, and a lot of the being able to receive and and take it in kind. I think they just launched some of that after 10 years. I think it's right to it. It makes more sense like finance doing this. You know, we see there's a lot of opportunity when it comes to integrating with what we're building, whether it's holding a key, not holding a key. I think the big gap, and it's going to take a while, is just the notion that if Bitcoin credibly enforces 21 million, it more than likely is a reserve asset. And if that's true, you're incentivized to get your, your grubby little arms around as many Bitcoin as a business as you can. And that doesn't work if you're leveraging third party white labels. And as well as you know, this, this is what I, you know, talk to banks about is the disintermediation that has already existed with the top 4IN sub custody. You're going to see more of that. Everyone's working on stable coins right now and what's their plan there? But they're not thinking about how do they actually manage custody around Bitcoin. And it's not an either or thing. I think the the folks that win, whether it's crypto, digital asset and trade fire firms are going to be people that park best in class products around stable coins, Bitcoin, even potentially gold. And then how do you let people cross collateralize and get access to dollars via lending solutions that are robust and resilient and that kind of bypass a lot of this stuff because like, think about how much crazy stuff bit finance does if you get their white label. And you have because like there's a lot of complexity when you think about wallet architecture supporting, you know, 10,000 crypto currencies and everything under the sun. And that's just going to be the trend for the next, call it one to four years as people are just going to get inundated with so much slog versus just like keeping the focus, especially empirically, whether it's market cap weighted to trading volume, it's all just Bitcoin and stable coins. So you can just get, you know. The meat without the fat. But nobody tells this story to them, so they just literally think it's like crazy and they're like, well, you're just close minded. You got to focus on everything and it's like our beautiful city. Yeah, it's a bit of a, you know, a bit of a catch 22 in the sense of like if you are the incumbent, the Triadfi or the fintech firm. I think you're right, Liam, in that it does make sense to do deals like this because they're sort of a, you know, you're on the clock in, in some sense in terms of you need to be able to offer this stuff to your clients. And while the sort of medium to long term right decision would maybe be to build it yourself and you know, think about it from first principles, there is sort of a, a race to market around this stuff, particularly for the, the Trat 5 folks in the fintechs that, you know, near term, it does make sense to just either acquire or do a partnership like this. So at least you just you have something. But to Mike, Michael, to your point, like that's probably not the right long term path if you actually want to win longer term and get closest to the BTC and do things the right way and and own your own infrastructure, etcetera. So it is a very interesting spot for those types of folks. And yeah, I did want to move to a couple other headlines related to this. And so we went from, you know, the crypto incumbents bridging into Triadfi. And so now we're going the other way the, you know, Triadfi folks, or, you know, traditional fintechs moving the other way into crypto. So there was this headline, Walmart backed fintech one pay is bringing crypto to its banking app. And then there was another one that I think you brought, Michael around Stripe getting into stablecoins in a, in a big way. So maybe I'll hand it to you, Mike, on this Stripe deal, but just more probably now going the other way from incumbent into crypto. Thoughts. Yeah. The, I thought this was fascinating because effectively Shripe is going to want to let anybody, their clients build their own stablecoin and pass or, or generate that yield, right? Because I think that's going to be something we'll we'll talk about on this podcast of just some of the market mechanics around Circle and Tethers dominance. And how does that play out? But ultimately, I thought it was just very fascinating to see Stripe sit in the middle referencing the acquisition of Bridge and ultimately letting any kind of financial institution, fintech or just traditional commerce business have their accounts, which they generally probably already do with Stripe launch a stable coin. And you know, TBD how that plays out for a number of reasons when it comes to interoperability. But I do think that it makes a lot of sense that if you have a lot of distribution, why you wouldn't want to own that wallet balance and then ultimately be able to incentivize passing that yield back to the client and generate more of the the economics. So I thought that was that was a pretty interesting kind of nugget and it ties into a little bit of the the finance stuff. But on the other side do. You have any thoughts on this one? No, it makes sense. I think we're going to see Tether and Circle probably be larger players for at least the the near term. And then we're going to see a bunch of niche smaller players pop up with however much they have generally in terms of their existing deposits for their customers. I don't know how much additional distribution they're going to get outside of net new customers coming into the platform or their stable coin unless it's they have a really tailored strategy in particular. But this is a pretty easy way to just grab a couple additional bips if they're buying the treasuries themselves and just continuing to have their customers on the platform. And yeah, go ahead or I was going to pull up your other link from standard charter talking about 1 trillion could exit emerging market bank deposits for stable coins. Yeah. So I think we've had a lot of numbers thrown out in the past, call it six months. Standard Chartered threw out 1 trillion exit emerging markets, I think I forgot who was that had like 3 trillion by 2030. Funny. Enough to just in general, you're saying that that would be stable coin market would grow from whatever it is 300 billion to 3 trillion, Yeah. And so we just I think today's past 300 billion in stable coins issued or like you know, total, I guess total value locked up in them. What's what I was thinking about going back to the one pay deal. I'm curious because I think Brian, you brought that, if you had any other thoughts. There is the notion of it's all going to end up looking like the same system again when you think about it, because like the stable coins probably get obfuscated away in the background. Like I think now when you know, again, I haven't thought deeply about it, but the initial thought is like the tether stuff trying to raise that money is because their dominance has maybe peaked. And the notion of if you're going to need this stuff to be interoperable because if it doesn't, then you kind of like unless you hit a flywheel of escape velocity and that would make the case nobody has because we're still so early. Like how many dollars are actually issued on chain versus still used? It's probably like, you know, 1% or whatever. Point being is that's going to get obfuscated and they're going to need to be interoperable. So you're just going to naturally end up having people not really even knowing what they're using. And because this ties back to Walmart, I don't know the numbers, but it's just like their scale when it comes to they're one of the few players that can actually get Visa and Amex and MasterCard to move when it comes to interchange and being able to do just like in lean on them when it comes to invoking like if they want to make changes. And point being is that one pay deal is kind of interesting because if they own that fintech application and they have distribution via their, you know, people going to Walmart and then they can get them to download that. Well, eventually they would launch their stable coin. But then over time, like if everything that settles to BTC and it's interoperability at different layers, it probably looks and there's all this interoperability at the stable coin layer already. You can imagine like Satoshi start getting interoperable with stable coins and it all just like fuses together. And so anyway, I'm just thinking out loud like it's, it's an interesting area we're going to because it makes complete sense for everyone to launch their stablecoin because of the it's, it's literally a click of a button and it's digital and there's not a lot of banking. That's not their infrastructure. But like the, the gatekeeping has been lifted. So now you don't need these large players like tethered circle to do it for you. But then if that is true, then the interoperability is gonna have to be there to make the consumer experience, you know, where you don't know what's happening, which is ultimately just going to lead to nobody knowing what anything is. Just moving up dollars again. Yeah, which means that a lot of these firms won't approve a lot of value. I think that's exactly right. Like what was interesting about this one pay deal in particular was, you know, and to be honest, like, you know, I've never used the one pay app, but I'm sure it has a good, you know, good amount of market penetration if it's associated and owned majority owned by Walmart. So that's the the sort of distribution angle. But was really, yeah, I think you hit the nail on the head in terms of like, it doesn't matter what stable coins they're using, how they're using it. It's just it's tightening the fidelity between you're spending dollars and you're saving a Bitcoin. So part of what this whose article states is that they, you know, they want to probably won't have until next year, but they offer the ability to hold Bitcoin ether in the mobile app, convert the crypto into cash and use those funds to make store purchases. So this is kind of, you know, we've talked about before, it's just like getting the the user interface and user experience to the point where you don't really know you're using stable coins. There's this Bitcoin thing that sits right next to your dollars that that basically gives you more dollars over time. So like you just hold you hold a certain amount of value in that in that bucket, it generates more dollars for you over time that you can use to spend on things. And so I think that that's what stood out to me as interesting about this one is like we've got the distribution and now it's just about tightening that fidelity between dollars and savings. And I expect to see more of this like, you know, Walmart in one pay won't be the only people that are trying to get it exactly that use case and that interface to be super clean and really train consumers and and and clients to spend in dollars and saving Bitcoin. I think that's where this is all headed. And it's it's infrastructure and deals like this that will get us to that point. Yeah. And that's going to be really interesting too, because a lot of, well, not a lot, but there are certainly Walmart customers out there who don't have access to bank accounts directly. And so being able to essentially store all of their finances into an app like this, it's not going to be all Walmart customers, but even a relatively small penetration of different customers who can do this will be great to see. And then Walmart is one who definitely should be exploring Bitcoin based reward systems. They have such a massive loyal customer base, especially for Walmart 1 type customers or Walmart plus I think it's called. And the just ability to allow your consumers to save in Bitcoin will just drive additional sales to your business moving forward and be net good for you. If all of your customers are actually saving their money in an asset, that's going up over time and going to allow you to have a little bit more pricing power too, as they just get a little bit richer over time. I will say this is a little bit of a hot take, but I'm fairly confident that this proliferation of stable coins at the same time that we're at the current debt levels and then lowering of interest rates will effectively call us the next global financial crisis. And, and the main reason for calling that out is because I've been thinking about, well, you're naturally going to either want a net settle or put Bitcoin next to it to, to go into a harder form of money. But I also think it's going to matter for the self preservation of the individual or the institution because it goes back to like custody where you think everything's fine until it's not. And so the ones that do it right will naturally be insulated because our clients will have already parked the money in a form of, you know, money that can't be debased. It's sitting, you know, off chain, ideally multi institution, ideally where assets, you know, can't be moved or hypothecated. But the point being is that the firm's, when you start inserting more dollars, more risk goes out further on the curve. You're using it to backup derivatives like you're just going to end and they can move at the speed of light versus what even bank wires had to do at Silicon Valley Bank. It's just going to add a level of volatility that nobody's prepared for. And yeah, it's going to be very interesting, but I don't see how it doesn't play out that way given all the initial. It's less about stable coins, it's more about the existing market. And then you just add basically gasoline to that. And that's how you end up with like a crisis. Yeah, there's. It's just going to be easier and easier to escape the perpetual debasement of money through either Bitcoin or and stable coins honestly are less risky. If you're just in Japan and you know that your money is going to be debased and you're going to have higher inflation rates and they're going to continue to perpetually offer easy financial conditions. You're going to want a unit of account initially that you know goes down a little bit slower than than actual Japanese yen, and that's going to be stable coins. And then you're going to realize that Bitcoin is right next to it everywhere. And that's actually going up in value versus just going down slower than the Japanese yen. And so it's going to the distribution of Bitcoin is going to kind of be turned on everywhere all at once right next to the stable coin assets too, as well as all the different cryptos. And there will be a lot of money lost. But ultimately it's it's going to really drive a lot of net new eyeballs onto the asset class as a whole. Yeah, it's well said. I Michael, you did allude to this notion of the the duopoly in stable coin. So Tether and circle, Nick Carter wrote about this last week effectively saying that the that duopoly has topped, you know, I think forget the exact numbers here, but it was around, you know, 90% market share a year or two ago and now it's down, down from there. So any other takeaways from this write up from Nick just on the the sort of market share of stables? Yeah. I think we kind of touched on this with the bridge deal, but it's just the notion that if Tether and Circle had to do awfully, they were taking the majority of net interest margin and taking it for themselves, not passing it through. What are they? They're going to in a situation because ultimately that's how they're sustained their valuations and their moats, and you're going to have all these other competitors step in to allow you to launch them and then they're incentivized because they can pass that through. I think there's another angle, which isn't really widely discussed, and it was part of that hyper liquid situation is that let's call yeah. So Tether in Tether and circle, let's call it, have 200 billion of the $300 billion market of stable coins today. Well, that 200 billion sits on places like, you know, bit Fenix owned by Tether has some portion of it. And then Coinbase has some circles. But the reality there's all these other places that have that and they're not receiving any of that yield. And so in a world where an exchange or another firm, financial service firm wants to issue it's own stable coin and then maybe they split the fees or the economics and they give, you know, 2 1/2% back to the client, the holder, and then the they keep the other 2 1/2%. There's just going to be a lot more competitive forces there. And that goes back to the valuation kind of like top ticking and extracting it at the best point before this kind of plays out I think is the essence of and that's where this piece right here bringing up his yields are raised to the bottom. Yeah. And with this chart here specifically is showing this is pretty wild stablecoin supply excluding Tether and USDC. So you can see really from the beginning of 24, you've seen this rise in sort of the the everyone else bucket outside of those two major players. Yeah, and the last part, like what Liam said about the Japanese yen and and safe havens, they will be with the caveat like they still are susceptible, forget about like being seized or turned off that you don't know, like where the risk lies. When they start to everything feels like it's going to get obfuscated and blended together on, you know, if it's a corporate bond that it's going to or generate another yield and then that corporate bond is insolvent and all these just different things. It's like, oh, sorry, you're actual because you decided to, you know, opt into the 3%. These are this was in the terms of service or the, the, the T's and C's and ultimately you kind of like have to take a haircut of 50%, you know, because like we've already had, we had claims on it or whatever it is. I think that's the angle of people don't actually, they're still not your dollars in the same way the banks dollars still not your dollars. And that's I think the thing that's going to play out on a long enough time horizon where people realize they're still counterparty risk outside of just the fact that they can be turned off or censored. Your bank, your account can just be white. Yeah, exactly. It's going to be, there will be a ton of bank runs and there will be lock up of funds and you can only take out certain amounts over certain periods of time and there will be a lot of rehypothecation in there. And your counterparty risk will also be important, especially if you're holding stable coins that are outside of the US too. I think that's going to be an even bigger issue as other currency or other nations just want their own debt to be monetized rather than just the US in general. Hey everybody, hope you're doing enjoying the podcast. Just wanted to give a quick word from on ramp in the the knowledge center specifically, I think there's a lot of individuals that have been listening to this podcast for a while. We hear from them every week when they finally decide maybe give an on ramp a try for some of their financial, you know, services when it relates to Bitcoin. We have a knowledge center that covers a lot of the commonly asked questions. You know, you can always reach out to me, you can book a consultation to learn more, but common questions around what is our insurance by Lloyd's actually cover? What are the best IRA providers in multi institution? Who holds the keys really? How does multi institution custody protect against physical threats? You might be familiar with the launch of Honor and Guardian that was announced a few weeks ago. That adds additional layers on top of just the multi institution security along with video verifications as the price creeps higher. You know, 125,000 all time high. We'll look small in the places that we're going and so when you think about $175,000 Bitcoin, $250,000 Bitcoin naturally having built in this space for a very long time, most individuals are not prepared for that whether it's a hardware device or you know, collaborative custody set up and understanding the X pubs, the wall config file. How did they plan for inheritance, how they access financial services where you know, to make sure that the the keys are secure, but they now need to access them to take out loans or sell Bitcoin. We solve for that in a bunch more. I'd encourage you to reach out. We'll be here when you're ready. But it to the extent that this price uptick has been one of the reasons you kind of want to learn a little bit more, I gladly, gladly take the consultation. We have a full team that will also support. All right, on to the rest of the show. Hope you enjoy it. Yeah, I don't know if this is a good, if you had anything Brian or this is a good transition to the the car deal because I'll I'll. Go there in a second, but just one more, one more thought on the this stables report from Nick. I I do think that this is a important closing thought in the sense that, and I'll just read some of this, you know, I used to adamantly believe that we'd only need one or two major stablecoins. Network complex and liquidity are king, but do stablecoins actually benefit from network effects? So they're not, they're not the same kind of business as Meta RX or Uber. Blockchain is a network rather than the token. If you can swap in and out of the token, token frictionlessly and swap between blockchains quickly and cheaply, the network effects start to matter less. So I think this is actually the most critical point of everything that he's saying is that as interoperability improves across these different block chains, across these different stable coin networks, as those exit cost trend to 0, there's, there's really not a lot of lock in across these things, particularly if you know someone's just using them in a trading format, they're going to be in and out of them pretty quickly anyway. They, they start to care less about what the actual stable is and just getting in and out of it quickly and cheaply. So I think this is a fundamental point of, of why perhaps this duopoly might not continue to exist. I think there's still a lot of fragmentation, but that is likely to improve going forward in terms of reducing those barriers. But you wanted to go to this cars deal. Yeah, some, some, you know, maybe obfuscated risk right now generally in credit markets, I think this is what this is referring to, but I'll hand it to you. Yeah. And I think the main reason why I referenced this post, that conversation around stable coins and risk is it just if we understand most people listening and that are long Bitcoin that there's a long debasement, long volatility. And as more monetary units get inserted, that just gets more distorts the signal around the capital allocation, which inherently means more businesses either get funded that lack fundamentals or propped up that should go away. And so it doesn't insulate that from being long Bitcoin or dollars like stable coins that as interest rates lower and more stable coins get issued, the capital still will get misallocated. And so this came to light. A firm called Tricolor shows same cars tied to thousands of loans. And some of the the key points are initial review of Tricolor holding shows that at least 29,000 loans pledged to creditors were tied to vehicles already secured and other debts. Roughly 40% of the 70,000 active Tricolor loans contain attributes identical to those of at least one other loan. It's the point that this exists everywhere in the financial system. It's it's very easy and people are incentivized to do this. It's similar with subprime, where you're making your money on generating and offering up dollars from a banking or financial service business. And so you're incentivized to not do the due diligence. You're incentivized to look the other way. And everyone's incentivized to take out more debt. And it just brings again, just this notion of that, you know, Fiat economics don't work on a long enough scale. And so there's risk line everywhere. And I think that's the thing that most people discount when they go into stocks, bonds and don't see Bitcoin as a true store of value and gold and Bitcoin as savings is they're just discounting the risk that lies within the traditional Fiat system as yeah, like I think I don't know how to express that. Like we'll need to do more on it. But it's the ultimate point is like the the 6040 year capital is not risk free. And so if you think Bitcoin's risky, you should really do a little bit more work because this lives within the whole financial system globally. Yeah, this is this headline in particular comes on the heels of of what I would consider sort of related headlines in terms of, you know, what we covered a few weeks ago around a lot of private credit funds that are offloading basically, you know, some bad credit repackaging them and and you know, selling them off to insurers. Coronas buy now, pay later deal with I forget the specific insurer that they sold a bunch of those loans to. So you start to see this across different areas of the market, right, where risk, credit risk in particular, is being obfuscated and hidden and disguised and repackaged. And it's not too dissimilar than, you know, anything we saw in 2008, but it's all sort of coming to the head again. And so this is just another example of that. And then there was there was this tweet, which this now has a a community note on it. So I'm not exactly sure how accurate this is, but the report was that 40% of Coca Cola's revenue comes from food stamps. Is this accurate, Michael, we now. Yeah, I believe so. I mean, I think the community note was actually giving more data around the revenues and profits. But ultimately whether it's exactly 40%, it's the core notion that Coca Cola's stock and their free cash flows took a huge hit with the recent Maha announcement and the ability for SNAP benefits to go to sugary, you know, beverages and other things. And it's this idea, again, going back to the Titus, back to business building is whether it's investing in businesses or looking at it from, if you're managing your personal portfolio or an asset manager, it's like, well, what businesses actually don't even have sustainable unit economics because they've been propped up by a system. There's again, that goes back to there's no shortage of these different businesses that exist that inherently shouldn't, but because of the amount of liquidity in the system, they justify it. And again, we've talked about this multiple times, whether it was like 21 and, and lower interest rates or even go back to the we work examples. There's no shortage year after year, cycle after cycle where the counterparty risk exists in something like Coca-Cola, obviously a foundational business to America, but there's a lot of valuation that it's crept into there that's been embedded by the government subsidies. We obviously know Tesla is another example of this. And I just thought it was more interesting because these things don't happen in a vacuum. I think we just want to look at stuff and be like, oh, that was just a one off, like the credit loans and then this Coca-Cola subsidies. But these are just the most acute, kind of like loudest exaggerations that are easy to point to, but they inherently are everywhere because that's the incentive model of when money costs nothing but a button to Click to create. Yeah. So I just realized this tweet was actually from December 22, so I'm not exactly sure how it got resurfaced, but it was kind of going viral over the past week or so. But Liam, did you have any other thoughts on that? There was some AI stuff I wanted to get to. But before I do that, one last thing, I think the reason why I got resurfaced was because they're spitting out of free cash flows basically like either went negative or took a huge hit and people were going back to that. It had to do with a large part of it subsidies. Yeah, it was negative free cash flows and I mean we don't need to touch on this too much, but the snaps benefits will ultimately be issued from an AI or I mean through stable coins. The New York is actually piloting that now of offering stimmies of 1000 to 1200 in USDC. And you know, Ubi already exists just in the form of unemployment benefits. But it's only going to ramp up from here as there's more that we talk about of asset holders and especially people that own gold and Bitcoin and Elon Musk hitting $500 million in his total net worth or 500 billion. And there are many people out there who actually have 0 or negative amount of personal wealth. So it's only going to ramp up. There are going to be more distortions and actually how people have capital and and where what signals your business is getting in terms of is this a sustainable business? Is this not everything from, you know, the 0% interest rates that Tri collar was getting back in the COVID time and allowed them to issue more loans on top of that to additional stimmies that are coming, you know, from SNAP benefits or just to the lowest end of the population. And so it's just going to be more and more distortion of the cost of capital and real business unit economics. This is wild, I had not seen this. The no strings attached 10,000 to 12,000 issued in terms of USDC and New York City for a couple 1000 people. Well, I just think, yeah, I think the USDC aspect because I'm sure we sent money to a lot of people, but the, the putting it into the, you know, the, the, the market and understanding like, I mean, I think we all knew this direction it goes, but to see them already trying it out in USDC, in USCC, obviously the logical courses is pretty wild. Yeah, there's a couple of interesting notes in here towards the end of the article. Still, stable coins like USCC don't always live up to their name. Serious market shocks can cause coins to lose their peg and become worth less than a dollar. And then it says there's also a question of how easily recipients will be able to spend the funds. Stablecoin use is not exactly ubiquitous. Some resale retail stores like Home Depot or should probably take USTCI, didn't even know that. But they're not a common method of paying rent or, for example, tuition. So yeah, that is kind of wild that they are piloting this. But I guess it's pretty small in scope, at least initially. Even on the other side of it, I think Trump was saying he they were like something about passing $2000 back. The reason? Yeah. Yeah, yeah, that rebate headline was pretty wild. 1 to $2000, you know, tax rebate, they're going to fund it through tariff revenue. That's like, you know, if you take the upper end of that $2000 for every taxpayer is about 165,000,000 taxpayers. It's like $330 billion of simmies. So it's not nothing that that is a lot of a lot of the basement headed our way. So continue to take note of the demase from trade as some might call it, it's the last trade. But let's move on slightly here. There was some AI headlines I wanted to get to mainly this one. So open AI is taking a stake in AMD chip manufacturer. And so you could take this a few different ways, but you know, it's somewhat of a diverse diversification away from reliance on NVIDIA for open AI. But there's it's, you know, the larger point to me or take away was something we've mentioned on the show over the past couple months. And seems to be a prevailing narrative is like this sort of like inter dealings and almost incestuous AI economy that would that has sort of emerge over the past 6-12 months. Where you have, you know, this is now open AI taking a a multi year strategic partnership with AMD. They will commit to deploying 6 gigawatts of AM DGPUS. This will start in the second-half of 26. And you know, it'll be structured as a performance based warrant granting open AI up to 160 AMD shares, which would be a 10% stake at 1 cent each. So vesting on certain specific milestones related to the deal. And so like I said before, it diversifies open AIS chip supply beyond NVIDIA, elevates MD's market position. So yeah, as as the headline here shows, AMD stock on up 35% this morning as a result of this. But it does, you know, raise the broader concern of, of industry concentration and just general centralization around a lot of these AI companies and the chip makers and sort of this this back and forth circular economy that's that's going on. Because, you know, I think Microsoft, who's deeply intertwined with open AI, obviously is also a large client of AMD already. So there's just lots of these sort of sort of circular nature of a lot of the deal making in this in the AI space over the past several years. And then maybe one other thing to reference in relation to this is just AI venture funding continues to surge throughout the third quarter. So global venture funding in third quarter increased 38% to 97 billion and about 46% of global venture funding for the third quarter went towards AI companies with 29% of that solely in an Anthropic deal. So again, this this speaks again to the concentration of broad funding, venture funding that is going specifically towards AI companies. Thoughts on any of this gentleman? Yeah, it's when things are going good, everybody looks like a genius. The money continues to go around in this circle. And you literally can't be wrong in any of the different bets in the AI space just because everybody else is wants to get in. And as long as you're not the last sucker at the table, you're going to make out like a bandit in dollar terms. But it's just the most Fiat thing ever in terms of open AI, which you know is hemorrhaging cash getting stake in other companies. It's just sending all of the wrong market signals of nobody actually being able to deliver real value and free cash flow. But it's just everybody chasing this idea that at one point, if there is enough scale, then the unit economics and costs can come down without actually really focusing on when, if that will ever happen. And will the money be cheap enough in order to actually continue spending like drunken sailors until there there is that breaking point in which costs of compute and the models to actually come down enough. And it's just more so about it's the same thing as the debasement trade, but just a worse version of it just because there's so many different layers of counterparty risk and signals here that are distorting the market. It's just it, it makes a lot of sense when you understand that all of the Fiat space is just chasing the same exact deals in the same markets and hoping that there will be another deal to come in and actually see this. I don't necessarily know the this deal quite as much as some of the other ones out there, but they're all in the same exact space, which is I don't know when some of these companies go public or or they actually get free, positive, free cash flows, but it's just sad to say. Yeah, I think, I think there's an there's a negative incentive like what you referenced on the venture side and certain aspects of the AI boom specifically like when you think about a net new incumbent or net new person coming in to YC and launching an AI company and they're going to get funding from it. It's where the markets, you know, the distorted signal, not to say there's not value there, but you know, at that level in the same way VC funds can raise more capital, they can tell their LP base, they can get the markups. With all that said, I don't think they're playing for the dollar returns in the sense that or, or exactly we talked about it like last week of the week before. I think there's a notion of just the amount of energy that's going to be required, among other things that are going to be this massive inflationary spike where and it'll be almost like public utility. You could see this coming from different angles of this stuff becoming systemic. And I think that's the race is to become so large at scale and systemic that you're, you're obviously or your, your, your, you're not prone to the laws of gravity or like unit economics in the sense that if you get to a certain size, whether the government's going to own a portion of these or you're trading dollars that we know are basically somewhat worthless, They can make more of them into energy, IP, equity, the GPU's, the real estate. You're just getting as much of it. You're incentivized because you know that you're going to be made whole in some capacity. And the real like value, if you look at like Bitcoin is the value for moving in the digital world is the value is to own the equity in that business and all of the underlying technology from compute and everything I just said. Because in that future world where we get to, you're going to be too big to fail. And so I think that's where you see all this like capital being deployed. And like you came out a couple weeks ago with Sundar and it was like similar sentiment between Sundar from Google, Zuckerberg, a few others where it's like, we can't, we rather go to 0 then like lose this race. And that's kind of like a different way of saying we're not worried about the money in the ROI. It'll be there as long as we can be one of the winners in this like new category. So I don't think they're trying to hit this like notion of profitability unit economics. It's more of like, it's just get to that scale and then they're going to be too big to fail. And I don't know exactly how it plays out or what their mind for is, but I think like it's on the margins that that's there. The rest of people are just chasing the wrong underlying unique economics incentives. But I think some of these bigger players like open AI, they know it doesn't make sense, but it's free dollars. They keep getting a raise from sovereigns and others to go and deploy. And then they're going to own those data centers. They're going to own all that infrastructure. And then when they don't have the right numbers, the government's going to be like, oh, here's some capital state float. And now the real value is owning all the wallet share, client relationship, AI models, everything outside of it independent of the dollars. And I think they can't. They caught on this probably pretty early. Yeah, I think that's right. It's not about dollars, it's not about immune economics. It's very somewhat unique technological state where there's the ability to say like there is this this end goal that's so great that it'll allow us to out compete all our competitors to have, you know, the sort of beach head that you're referencing. And that that opportunity is so great that it doesn't matter. The numbers don't matter. We're going to throw as much capital as this as possible. We're going to do as many raises as possible because that that opportunity, that goal is so great that, you know, it doesn't matter in the near term. It doesn't matter what what our unit economics are, what we're burning. And so it's, it's, I would say that that's a flawed line of thinking though. Like that, like it's. It isn't. It isn't well here, here's the angle they're they're basically this isn't apples to apples, but they're like what dats wish they could be because no seriously think about it like so a dat is trying to access the capital markets to take dollars, buy Bitcoin, raise their enterprise value and then effectively be able to leverage that. This is a story they say and then they will make more Bitcoin and they will have that. Well, we all know that it's just it's BS. We've talked about it for long enough, but when you look at these businesses, they're accessing, doing the same market mechanics of taking cheap dollars to go and buy infrastructure that can't actually be inflated, inflated away like the whether it's the IP potentially, but then the physical assets, they own that and you can make the case in that world where things get repriced, their valuation will still be greater than Bitcoin if they would just bought the Bitcoin today, because there's only going to be, you know, bitcoins finite, but also accessing the computer that they need. I'm not saying this is right, but it's a trade on in that future world, people in Bitcoin terms, they will actually be OK because they're delivering some product of good and utility in the market will have to be forced to price it if they need that kind of goods and services. Now TBD if other businesses come out and they're better, blah, blah. But you see what I'm saying with it, it's like a similar trade. It's like, well, we're just going to take as many dollars, we're going to go to it in this new world, whatever the world's underlying unit gets priced in, we're still going to be very valuable. And we're actually using the free debt markets and capital to go and buy that with like, you know, 0 cost to us. And that's where I think that it it actually kind of makes sense. Yeah, I mean, I, I see that. I see that angle. Like what is the alternative to doing this? I, I think you are more likely, you have a higher probability of losing if you don't take this mentality effectively. Because there's also some game theory associated with it where like if everybody's throwing as much money as possible at it and like you kind of have to, to keep up to even have a chance of achieving the goal or coming out the other side on top. So, yeah, it's very interesting. Liam, any other thoughts? I know we're a bit overtime here so we can wrap soon, but any final words? I just well, well, later you're thinking I just wanted to so we got, you know, definitely I think all time. Well, I guess the all time high was. 1343 That was like Saturday night or I. Don't know if that was no it was like a an hour ago. Oh yeah, that was an hour ago. But this this chart I wanted to pull up because it's something that isn't widely get shared, but it's just like, how can you as any anybody on the planet earth, you know, look at Bitcoin profitable days and not just like be interested because it just generally comes up from everybody, whether it's an institutional allocator, individuals like past performances and indicative of future performance or whatever. It's like what kind of is, you know, like what would cause it to go the other way? I don't know. Profitable days is always one of my favorite. It's all reflexive. It strengthen, strengthens the actual network and people who want to participate in the network. There are only 21 million. There's going to be stronger amount of hash that are securing the network and so it's going to only drive more network participants. It's looking pretty good for Bitcoin. Exciting time for dollars, not for dollars. Call out this week, we'll be in Dallas. So for anybody that's around, a lot of exciting things we have in the coming weeks, big announcements on companies we've invested in. We're going to host a happy hour with Tetra Trust on Thursday night in Dallas. So if anybody's around wants to reach out, meet up, come to the event, just shoot us a note. Love to see good stuff. All right. Thanks, gentlemen. See you next. Thanks guys. Thanks guys. Hey guys, I hope you enjoyed the show. If you liked it, please give it a like and a share or subscription. Like I mentioned, we'll be out in Dallas. The team from Early Writers and On Ramp will be hosting a few events. If you're curious on what Early writers have been up to, you can go to earlywriters.com. See some of the portfolio companies we haven't publicly announced yet. There's some very exciting announcements that are coming into the next few weeks when it comes to, you know, looking at from the first treasury company, Bitcoin treasury company business in the space that we backed. When it looks at the quote UN quote debasement trade that's now being talked about today. Back to company playing in the golden Bitcoin space all the way to new firms building globally on multi institution custody. There's a lot of exciting things including the stables with the accelerator that we launched and then we have new teammates joining across the world from investment banking to traditional portfolio management. We are really building a very exciting platform that should be pioneering what asset management on a Bitcoin standard looks like. If you're interested in getting involved, I'd encourage you to reach out or you can shoot me an e-mail at michael@earlywriters.com. All right, hope you guys have a great week. We'll have a awesome podcast this week and see you next Monday. Thanks for listening to this week's episode of the show. If you found the information valuable, please share the episode with a friend or leave a rating on your favorite podcast app. All the links we discussed in today's show will be in the show notes inside your podcast app. Before we finish, a quick reminder that Onramp Media is for informational and entertainment purposes only, and nothing should be construed as investment or legal advice. Regardless of where you are on your Bitcoin journey, we'd love to hear from you. Visit onrampbitcoin.com contact to schedule a consultation with one of our private client advisors.