Onramp Webinar Series E001: Bitcoin’s Full Potential Valuation

Thank you for joining us. This week. We're excited to bring you a webinar that was recorded in December of last year, now available for public consumption. This webinar hosted by On RAMP Media is led by On RAMP Co Founder Jesse Myers and On RAMP Chief Strategy Officer, Brian Cabela's, who are joined by Mark Connors, Head of Research at 3 IQ. In light of Bitcoin's most recent having, we're inclined to resurface this insightful discussion which covers Bitcoin supply dynamics and its full potential valuation. Before we start, a quick reminder that the On RAMP webinar series is for informational and entertainment purposes only and nothing should be construed as investment or legal advice. At On RAMP, we believe that Bitcoin will be the most important asset to own in the 21st century. Our multi institution custody solution is the safest and most secure way to ensure that your Bitcoin remains in your and your family's possession for decades to come. Multi institution custody maximizes security and minimizes counterparty risk. Leveraging Bitcoin's native properties to eliminate single points of failure that have historically complicated Bitcoin ownership on RAMP provides Peace of Mind for your Bitcoin journey. For more information check us out at on rampbitcoin.com. OK, so with that out of the way, my name is Brian Cabela's. I'm the head of Strategy and research here at On RAMP. I am joined by our Co founder and CEO Jesse Myers. And we're. Thrilled to have a special guest with us here today, Mark Connors, the Head of Research at 3 IQA Digital Asset Management Company. Mark has an extensive background in the traditional finance space and has a wealth of knowledge about the global asset landscape, the macro environment and of course, Bitcoin. So we're honored to have him join us for the first session of the On Ramp Webinar series. And so the the purpose and the intent of this series is really to provide individuals, investors and allocators with an interactive forum to explore the investment case for Bitcoin, its fundamental merits and really allow folks to broaden their understanding of this asset. As such, we, we would love to hear from the audience. So please submit any questions you may have in the Q&A box throughout the presentation and we will try to answer as many of those as we can in the last 15 minutes of the call. Also note that this presentation is being recorded. And before we jump into the discussion, I also wanted to introduce Cam Stromie on RAMPS Head of Private Wealth to speak a bit about on RAMP for those who may not be familiar with our business. Cam. Thanks Brian. So for anyone who's newer to on ramp, we are a Bitcoin asset management platform and built on multi institution custody. So a little bit about us and why we've developed this. You can think about our firm in a few different parts. The first part being education first and foremost, We've been educators personally, but then also professionally as a team for half a decade now or more in this space and view that as critically important. So appreciate your attendance here. The webinar is 1 facet of how we help folks to understand Bitcoin at a fundamental level and then at its highest level as well. We're focused on helping investors, family offices, institutions, pensions institute and corporations to buy and hold the asset for the long term. So then how do you hold the asset for the long term? As many of you may already know, there's a custody element to allocating to this asset class, which is not something that we're used to as investors. Looking across the landscape, there's a lot of nuance in custody. Michael and I have professionally dedicated over half a decade to understanding custody at its deepest level, talking with thousands of clients, helping onboard billions of dollars into Bitcoin, and helping investors to navigate that custody landscape and understanding what custody solutions are are best for them. Historically they have at we've only had two options for custody. It's either been you trust a single institution to hold your funds. That historically has had a number of pitfalls. FTX being the most recent and prominent example. The other fork in that road was self custody. Investors had to dig in and learn how to hold cryptographic material with 100% downside risk if those keys were mismanaged or lost. So on ramps provide the third option that has never existed before at the custodial level where 3 institutions on ramp, bit, go and coin cover each hold one key and it eliminates single points of failure, meaning that even if one firm fails for the first time ever, a client's Bitcoin is absolutely safe. So that's what we do at a high level. We'd love to chat with you individually after this webinar, so feel free to go to our website, schedule a call and I personally would love to talk with you. Thanks, Cam. So just a bit about what we're going to be talking about today. So this first sessions topic of discussion is Bitcoin's full potential valuation. Jesse Meyers published a report on this topic about a month or so ago and we really wanted to take the opportunity to dive deep on his analysis and broadly discuss discuss different valuation frameworks for Bitcoin. While the sort of high level thesis for Bitcoin I would argue is sort of increasingly well understood, it can be difficult to grasp sort of the magnitude of the opportunity. So we're also going to touch on some key catalyst for Bitcoin and and how those may impact its trajectory moving forward. So without further ado, I'm going to kick it to Jesse to big begin with an overview of his report and then we'll dive into more of an open discussion on the aforementioned topics. Jesse. Great. Thank you, Brian and and thanks Cam for that intro to on ramp. Yeah. So we're going to get into it now that the meat of it here of what is Bitcoin's full potential valuation. And you know, the the spirit of this sort of exercise is, is, you know, it's the the problem that we all face when we consider Bitcoin as an investment. You know, there's. This there's the spot price of Bitcoin today. That's what it's trading at. But obviously for anyone who's considering investment, you're only going to invest if you think that the future value of it is higher than what it is today. But that requires having a perspective about where this thing could go and why and and specifically how high it could go. So what? Is the full potential for bitcoins valuation? Well, it's kind of an impossible question, right? Impossible to know. And people approach this in different ways of, you know, how to value Bitcoin and where is it going. And that'll be a big part of the conversation that Brian and and Mark and I have after we go through this report here. But my effort was really kind of bringing my management consulting tool kit to how do you triangulate a a a decent answer based on a a variety. Of estimates and and a methodology for for what's possible here. So if we scroll Scroll down into this report here you know the the the starting point for and and and I should mention that this report is available on our website and for anyone to download and we'll we'll make the link to download it available in the in the chat and we can also. Follow up with that as well. So the first question. Is you know what is what is Bitcoin? What is this asset what market is it competing in what assets is it competing against. And and the reality is this is a store of value asset. This is digital gold. It has the properties of gold, but digitized and in in many ways improved upon, nearly perfected gold and what gold, really? Is is a. Store of value asset it's it. It has value because it there's not much additional gold being created every year and as a result of that you don't have much supply dilution of the value that you store today. And so value that you put into gold today propagates through time relatively effectively and that's a store of value asset. And so Bitcoin is is a store of value asset. It's it has many of those properties that in fact takes it to an even more perfected version of it. And that is really the way to think about Bitcoin as an asset is a store of value that if you put value into Bitcoin today, it can propagate into the future without much dilution. And and that is a very attractive thing especially in a climate like today where we are dealing with inflation, $34 trillion of of national debt in the US, sovereign debt crisis all over the world. And the potential that you know, we may see a high level of of inflation going forward as a result of sovereign nations needing to service their debt and print money to do that. So Victoria, that's that's the the nature of where Bitcoin fits in. If we Scroll down a little more to the next page and you know this is a a way to conceptualize how do you, how does Bitcoin stack up against other types of assets, right. Because every every asset has its own properties and not all assets are are made the same. Obviously you consume some things and some things depreciate and then there's investments that grow in value over time. But they they don't, they're not all the same. A investment in in land is going to be a a fairly stable investment that will appreciate over time. But it's not generating necessarily generating cash flows the way that equities might be and that like investment in like a a tech company might outperform that land. But here's Bitcoin, which in my opinion has properties that allow it to outperform any of these investment assets, the various options in an investment landscape. And that's what we've seen over the last 15 years of Bitcoins emergence as an asset from from nothing, from from an, from a a toy with 0 value to today where where it's an $800 billion asset and still still very early in its global adoption. But you know people watch on to the volatility along the way. If you were to smooth out that volatility and and represented on a on a logarithmic scale like this, it's something like a straight up and to the right approach. And so in my view and and over bitcoin's 15 year history, it does outperform any other investment asset because these specifically because of these properties of its increasing scarcity and the fact that it's early stage and it's global adoption. OK. Next section. So the next part of this piece of this puzzle is to think about what is the ceiling for various assets, What sets the ceiling? And when it comes to commodities, Bitcoin is a commodity. Typically what sets the ceiling is the amount of new supply creation every year that has to go out into the market and be absorbed by the market. So you know, if if gold is a is a $12 trillion asset and 2% more of it is made every year, well that's $240 billion of of gold that's created every single year that has to go out into the market and be absorbed by demand and just for the price of gold to go sideways. And so if gold was to suddenly 10X in value, well, now that it's not $240 billion of new supply creation every year, that's $2.4 trillion of supply creation every year. And there's just not enough demand for that. So that amount of new supply coming onto the market would suppress the price, drive the price back down back to this equilibrium that gold has established over time. And that equilibrium nature of how commodities end up finding their price ceiling based on the amount of supply being created every year versus the existing demand for that asset in general, that's how these, that's how commodities end up setting their price ceilings. And so that's an important piece to introduce because Bitcoin is different. So next section here. So in the world of commodities, Bitcoin is different. It's the first digital commodity and it's the invention of digital scarcity. And that is a one time phenomenon because you can have copies of digital scarcity that aren't themselves scarce, because it's always possible to have an incremental copy of a system of digital scarcity. But there's the original instance of digital scarcity and it's Bitcoin and and so this is a part of the you know the if you Scroll down a little bit here the the Internet revolution. Here the digital revolution, which is really two pieces. We we've lived through the digitization of information which is the the Internet. That's how we went from a world of analogue information to a digital world of information. But you couldn't put value onto the Internet because it's always possible to copy and paste and and that doesn't work for value. You can't have that. And so Bitcoin is this invention of a system of digital scarcity that allows for the digitization of value, this complementary digitization of value to the digitization of information that I believe we will end up looking back on as the second Internet. So we I think are in the early 90s for the Internet of value. If you Scroll down to the next page and the the important thing here to link this back to the topic of what sets the ceiling for commodities, for commodity valuations is that Bitcoin has these, this very unique attribute in the commodity landscape which is it's increasing scarcity. So you see this, this chart on the page here is the supply schedule for Bitcoin. The asymptotic curve up and to the right is how much Bitcoin exists and you can see that flat line at the top there. That's the total that will ever exist. There will only ever be 21 million Bitcoin. The orange bars are the amount of Bitcoin being released every every 10 minutes across these four year periods and you can see that that amount gets cut in half every four years. The result of this is, is increasing scarcity. So yeah, every four years the amount of new supply issuance of Bitcoin gets cut in half and that ties directly back to the conversation about what's its commodity price ceilings. Because Bitcoins supply issuance goes to zero over time, it keeps dropping asymptotically to zero. And that means that this the market has to absorb less and less new supply and that allows for the potential that the ceiling price of Bitcoin to scale endlessly. And that's different from any other commodity ever in the history of investable assets, because that was never possible in the physical world. It's only possible in the digital world. And and this is the one and only instance of digital scarcity. So it's only really possible with Bitcoin. OK. So if we we then put these pieces together. Next section, yes. And so that Bitcoin has an unthinkable property. It gets more valuable over time because of this reducing issuance, this increasing scarcity. So that's that. Go to the next section, then. OK. And now we need to take stock of OK, how much value is out there? What is Bitcoin in the global asset landscape? As you can see on on this this graphic it well it was 500 billion. Dollars in value. Two months ago when I made this graphic it it has now grown to $800 billion of value. But the the global asset landscape hasn't hasn't shifted. There's $900 trillion of value out there in these various store value buckets, real estate, bonds, equities, money itself. That's how much value is sitting in these different types of assets. And now here's this tiny little thimble in this ocean of value that has these properties that we've just talked about that make it more attractive as a store value asset than any of these other assets because of its increasing scarcity specifically. So then we have to think about, OK, all the value sitting in these different buckets. Will some of the value in these buckets want to reallocate to this more attractive asset when they evaluate these things, you know and and take a serious look at Bitcoin. And so then we can go to the next section and and come up with how we would do that. Scroll down a little further. So if we were to take stock of all those those buckets of value and add up their trillions of dollars in each of those buckets and then think about OK, if I'm an investor who's holding a lot of bonds, for example, and what is what's a bond doing for me in My Portfolio? It is promising a certain nominal return, you know 4 percent, 5% return into the future, which doesn't account for inflation risk of of the units that you're receiving dollars. And you know most most commonly here, but that's the that's the point of holding a bond is that you are receiving some reliable nominal return for parking your value in that asset. But if Bitcoin has this increasing scarcity function that reliably delivers increasing value over time, if you hold the Bitcoin for four years or more than that might serve you better than it's a small nominal return of dollars, which is an asset that's that's being debased over time with with inflation. And you know, you by holding a button, you may or may not actually receive a a positive real yield. So you might be receiving a negative real yield just by holding a bond. Or you could switch part of that bond portfolio into this asset that delivers a guaranteed increasing scarcity because of its supply mechanics, and that increasing scarcity manifest as increasing value over time. How much of that of your bond portfolio might you, you know, want to reallocate to Bitcoin? I don't know. It's it's up for anybody's interpretation here. In this Bitcoin Capture column, I put forward my conservative estimates of what I think holders of these different asset classes. How much of the value park there might. Want to overtime reallocate to this asset that I think has more attractive properties than any of these other store value assets in the physical world. Maybe it's 30% for bonds, maybe it's 5% for bonds, maybe it's 90% for bonds. It's really up to everyone out there to determine for themselves what they think is possible here given the properties of Bitcoin that we've talked through with these numbers, with these assumptions here, which I think are conservative and you know you can argue with me on them and and you can come up with your own numbers and I encourage people to do that. You can take the same table, plug in your own numbers and then see what that bottom right number spits out in terms of the potential valuation in your mind for Bitcoin using this framework. And if the if that value is is greater than $40,000 per Bitcoin, you are you inherently believe that that Bitcoin is underpriced today. My numbers resulted in a a crazy valuation, something I'm you know for some time was almost embarrassed to share with people because it sounds so absurd. But this methodology arrived at $200 trillion of value for for Bitcoin in the long term. In today's dollars, which is to say this, this, this will take decades, This could be a 30 year endeavour. But I believe that Bitcoin can absorb 20 to 20 to 25% of the world's store of value assets into what is currently a tiny little thimble in the in the ocean of of global asset value. So that's my full potential valuation for Bitcoin. I think that Bitcoin can can reach as high as $10 million per Bitcoin in today's dollars over the next several decades. So that's the this whole report here. If anyone's interested in in downloading it, the link for it is in the chat and you can also find it on our website. And so now I'd love to open it up for for Mark and Brian to you know provide any thoughts they have on on this approach and then we can talk about other ways to value Bitcoin and where this asset is going long term. Well, Brian, why don't you kick it off? Because I know you, you're there working a little bit with Jesse, so you might connect it to the body of work. Yeah. So, you know, I would say at a high level, I think Jesse's analysis is incredibly useful for for a number of reasons. But you know it it helps provide investors with the context for bitcoins potential. You know, I think when approaching this asset it's it's can be very difficult for investors to grasp its real potential. And the reality is that you know investors and and humans generally have never observed an absolutely scarce asset go through a monetization process like this. So it can be almost difficult to fathom, you know what the ultimate price ceiling for for this thing could be. And so I would also say that you know I historically have personally struggled with specific price predictions because I think you know it's certainly more of an art than a science. And I think you know Jesse's analysis is a is a fantastic effort to sort of triangulate a a plausible trajectory here. But for me personally when I, when I think about Bitcoin's valuation, I really think of it as more of a directional analysis. So you know if we distill Bitcoin's price appreciation down to its core levers some of which Jesse walked through it, it's really all about supply and demand. And so we know what the supply distribution is and we know that there will only ever be 21 million bitcoins. So given that static eventual supply the, the critical lever to to really assess is whether demand is continuing to increase. So you know all else equal if demand continues to increase, Bitcoin's price will continue to increase. And so for me I I tend to focus on assessing really the drivers of demand and and sort of trying to identify those key indicators that demand is in fact increasing. And so you know that that would include metrics like unique wallet creation, transaction activity, hash rate growth and and so I think you know it's important to recognize that Bitcoin is more than just a financial instrument or a a digital commodity or a currency. You know at the at the protocol level this is a piece of technology that enables A globally accessible permissionless payments network. And so part of the demand for the asset stems from the expanding utility of the protocol itself. So I like to think and and sort of focus on the development of second and third layers like the lightning network that are enabling activities not possible on income and payment rails. So like I said, you know a great example of that is the Lightning network which has a lot of interesting implications in sort of the realm of micro payments. Another example is, is totally separate from that in the realm of Bitcoin mining. You know the, the process of Bitcoin mining effectively eliminates the notion of stranded energy which is pretty powerful. You know humans are now able to monetize sources of energy in a location agnostic manner. So from that perspective, you know Bitcoin has these other forms of utility that are outside of purely price appreciation. So you know natural gas producers out in Texas that would otherwise be flaring methane into the atmosphere, they're now able to capture that methane and monetize it on site through through Bitcoin mining. And so I think, you know, that's one of many powerful concepts that I think, you know, most of the investment world is, is still largely oblivious to. And I think, you know, it's it's these sort of endogenous factors, you know, specific to the Bitcoin network, the asset, the protocol. But it's also important to consider, you know, the exogenous factors that drive demand for Bitcoin. So, you know, namely, you know, the fallibility of the incumbent Fiat system. So as more people recognize the unsustainable path of debt creation that should actually reference and and you know the debasement of Fiat currency, I think the signal of Bitcoin becomes more and more evident. So I tend to look at it a bit more of in a vacuum and not try to put a specific price point on it, but just say what is the sort of trajectory here? How can we look at this directionally and assess weather demand is continuing to increase and like to likely to increase in the future. And I think a lot of that has to do with, you know, the network itself, the sort of different forms of utility that it enables as well as sort of, you know, reflecting on the incumbent system and why Bitcoin as a pristine store of value makes a lot of sense in a portfolio today. Yeah, awesome. It does. Yes, it does, Brian. And if it's OK, I'd like to jump in. And I love this page in Jesse's report because I just can visualize why all why the value that he laid out in the other page on the allocation will fly from real estate, bonds money in. And So what I'd like to share is the thesis which developed while I was at Credit Suisse, a bank that no longer exists and disappeared overnight because their job of printing equity to sell to the Qataris and others wasn't enough to keep them afloat because of bad behaviors. So excuse me, what? So the thesis that I developed by watching the banks. Sorry about that. Had a little phone call that came on there because we are an emergency here and the the the traditional finance debt load has gone to a level that will lock out a lot of people from being able to accumulate gold, art, equities, real estate, bonds and money. So everything you see here, the wages no longer allow wealth creation and wealth accumulation. So that's a major problem and the way that we've shown that is the growth in financial assets versus the growth in wages which basically puts home ownership out. So that's a major problem. We start at, like that Maslow hierarchies level, you know, very, very baseline. And that has gotten that resonates with people because when we look at the investment world, we basically are trying to solve, you know, to serve human interests, to wealth creation and what's the best way to do it. So there's a problem in traditional finance and there's a remedy in Bitcoin, and there's an urgency. It's those 3 words. And we started it a few years ago, and we still lean on that. The problems keep accumulating. We had that thesis before SVB Bank went under. We had that before the US got its third downgrade watch list. We did it before the debt ceiling issues. So there's a problem and the problems just mount. And all that's happening is you're having more government intervention, do things like create more of the money. The Federal Reserve only accounted for about 10% of the entire monetary supply in the US Now they account for 40. There's a centralization of the US financial system because it's become too fragile. Muhammad Aleri talks about this all the time. The financing of treasuries is now a nail biter there. Some people don't show up. So this is happening in real time. So let me go back to Jesse's point here and and I just want to share another part of our model in case it helps. Within that problem, remedy and urgency call to action. We look at the world through an economic lens. How's GDP doing? How's employment? We look at that through markets because that's our best way of getting information on where the votes are for different asset classes, equities, credit rates, currency. Some of the things that Jesse shows here, The last one are players, that's people, that's central banks, that's investors. So when I look at this chart, I see real estate, it's being held. It is, it is a store of value. It's moved from a place to live to a place to pass on to your children. That's not the way it was previously. But with debasement, these finite assets are held and they're becoming money. They're starting to be broken up through Airbnb. People are actually compart, you know, breaking apart their their homes, but they can't move them. So Bitcoin does a better job of storing value and disseminating money will go from real estate to Bitcoin. It will go from equities. It's a Bitcoin and certainly as Brian stated, money will go from Fiat into Bitcoin. You know, we haven't even gotten into the remittances, you know, 1.5 trillion where people pay 8% a year. So is the case for Bitcoin there? Absolutely. There's a trash can fire in traditional finance. That's what we spend a lot of time focusing on to get people alert to this. So I'll stop there. Thank you for watching. Whether you've been buying Bitcoin for years or just getting started on your journey, our multi institution custody solution is the safest and easiest way to custody or Bitcoin. With on RAMP and our partners at BITCO and Coin Cover, you can sleep soundly at night knowing that your Bitcoin is safe from exchange failures, the loss of seed phrases and broken hardware devices, and now a word about on RAMP heritage. Bitcoin inheritance planning requires addressing both key management and legal title transfer to beneficiaries, necessitating comprehensive estate planning. We have a guide that provides A detailed overview of the intricacies associated with Bitcoin inheritance planning and the role of multi institution custody in preserving Bitcoin ownership across generations. Additionally, we will be hosting a webinar on the topic on May 22nd and will include the registration details in the show notes. Visit on rampbitcoin.com/heritage to learn more about Bitcoin inheritance and estate planning. It's it's a fantastic added point there of this this image is really the outcome of the current system and and 50 years of Fiat money which is to say unbacked paper money as our monetary standard. And the result of that is is real estate prices going so high. Real estate has become money. It's become our savings account. We you know the the the conventional wisdom has become get a mortgage and Max out your 4O1K and that's how you will save you know for your retirement that that means that we're treating those assets as money because we're not saving dollars for a rainy day. You're you're plowing your value into these other assets to serve as money and that's how these buckets have gotten so big relative to the the rest of the picture. It's because the nobody wants to hold the the money. So you end up holding these other assets instead and bidding up the value of them relative to other assets in the global asset landscape. And then Bitcoin represents this this potential to restore the value of holding money because money will not be debased over time and you can rely on it for a rainy day without it and suddenly the money supply having doubled since the time you originally you know stashed away that that those savings and and you know so I think Michael Saylor has been using this this chart it. So it's been a a quite an honor. Recently he's been using this for some presentations. And. And and starting with the, the, the line of there's a a constant ongoing global war for value and where you know between assets, for, for where you want to park your value. And that's that's the story of store value assets. And that's why this tiny little asset that's currently 1212 thousandth of of the almost one one thousandth now of the of the value in the global asset landscape is different from the rest of these buckets because of its digital nature. It is dematerialized and therefore it has absolute scarcity because you can always make more real estate, you can always start more companies, you can always find more gold, you can always make more art, You can certainly print more bonds. We've been doing that at A at an incredible rate of nearly $6 trillion annualized over the last four months. And Jesse, can I jump in for one second about this? A a minute ago you were talking about, you know, like a war and you know the there is a friction. Not everyone wants to have this, this animal of this decentralized global asset get adoption because you said the word mortgage to buy a house, usually get a mortgage, A bank gets paid for that, bonds get issued, there's a fee to issue them like this. This is feeding a traditional banking system in a very inefficient manner. But we understand, I was in the space, you went after transactions, even if they weren't efficient, even if they really didn't, you know, serve the greater good over a period of time. So you're going to get the FUD like what Jamie Dimon said yesterday or say don't want to have this store value, this, this thimble you said in the ocean, grow into an ocean liner like, but it's going to happen, you know. So I think that's something to bring up to our audience because you're going to be hearing some negative things just because incentive structures aren't aligned to have Bitcoin grow. It's a fantastic point that that there's this, there's this disconnect between the economic reality of Bitcoin with this increasing scarcity that's built in. And it happens every four years because it's in the code that everybody's running on their computers. When you're participating in the Bitcoin network, it's inescapable. Increasing scarcity will happen. And that based on the logic presented in this report, means the value of Bitcoin goes up over time as as there's less new supply being introduced to the market going out to meet demand and that allows the the, the ceiling price of this commodity to to increase over time. That is so different from the noise that we hear that that is not rooted in any economic reality of about concerns about Bitcoin, about how Bitcoin you know how it can can be used by criminals and or it's it's bad for the environment. All these things that are are are very thin arguments and and in fact when you dig into them quite to the contrary of reality. But there are these justifications for why Bitcoin should not be adopted that are coming from, of course, the existing system. But you know, you can't stop the economic reality that is simultaneously playing out in Bitcoin. So it's up for everyone in the world to to grapple with that dissonance and figure out what they believe will happen. Will economic reality continue playing out, or will narratives from the traditional system stop that? Yeah. I think what one other thing to consider here is just the juxtaposition of Bitcoin versus all of these other buckets in terms of basically the the ability to foresee what is going to happen in the future, right? Like we know that Bitcoin supply issuance is transparent, known and immutable. All these other buckets, there's question marks in terms of new supply coming on to the market, new businesses being created, gold coming out of the Earth or from some asteroid in space that we haven't found yet. So there's there's I think going back to my earlier point about, you know, focusing on the lever of increasing demand, I think for me it comes down to the likelihood that humans are going to increasingly want to store their value into the future and something that they reliably can predict the supply of, right. And so I I think it's it that juxtaposition just becomes more and more clear as we see sort of the mounting debt levels, deficit spending, interest expense on the debt, all of these things that we're aware of that should raise questions in your mind about storing value in all of these other buckets. And I think sort of the purity and simplicity of of bitcoins supply issuing schedule I think is something that is going to become more and more attractive for people over time. And it's it's just a matter of people sort of being able to wade through the FUD, wade through these really false narratives that that are out there and understand that this is. This is a piece of technology and it allows you to propagate your value into the future better than anything else we've ever seen. And so I think that's what I, that's what I sort of always come back to is like what are the levers that are going to make demand continue to increase. And it's it's ultimately it's people getting the knowledge, people, you know, attending webinars like this and understanding sort of the fundamental attributes of this thing and why relative to all these other assets that you could store your value in, it's pretty attractive. Yeah, I, I, I, I'm noticing that we we're having a bunch of great questions about that I think we can incorporate into this conversation about Bitcoin and Bitcoin's value from the audience here. So Blake Cornfield asks about how does this valuation approach, how is it influenced by by high inflation? If inflation was to increase into the future what does that do And and he also asks you know if if if the numbers I presented in this report are are the conservative case what's the what's the bullish case for Bitcoin. So I guess I'll start with with that part there of one of the one of the memes that that you'll see in the Bitcoin space is, you know, the eventual value of Bitcoin is, is everything divided by 21 million, which sort of implies that all of the value in the world will be, you know, funneled into Bitcoin and represented in Bitcoin. But I think that that's not possible. That's A2 extreme version of what's, you know, the bullish scenario because that assumes that nobody wants to hold anything else. But of course you're going to want to have, you know, a house land people are going to want to hold the the Monet paintings that are their prized possessions. And so there's value to other assets. But the question becomes for everyone, you know to decide for themselves what percentage of the total global asset pie does a perfect money end up winning versus every other asset. And I think you can draw that line wherever you think is possible. You know is that, is that 5% of the total, is it 50% of the total That's up for everyone to decide. With regard to the inflation part of this, if we enter a if inflation is to increase versus what we've seen over the last few years of this. If this spike in inflation has been a prelude to what's coming with with the amount of sovereign debt. And and I think the level of printing that's going to be necessary to service sovereign debt with given our multi trillion dollar deficits every year. While we might be seeing high inflation and and more higher inflation over time and it could be higher and higher inflation over time too. So this problem could continue to get worse as that if that was to happen then the value of any assets that is based on future cash flows from those assets changes. So in a in a high inflation environment a a, a company that is you know whose value is based on future cash flows that those future cash flows are worth less and so that you discount the value of that company more and it becomes it's a less valuable company. And so the stock prices suffer and that's true of of of you know commercial real estate as well rental properties. The future value of those cash flows is discounted more. So then you, you don't want to be holding that asset. Bonds sell off in that environment too. And so you know the higher inflation goes, the more valuable an asset that is immune to inflation becomes. And so you know if that is to happen that trend continues and grows. Bitcoin becomes more and more attractive relative to the existing option set. Anything, anything else you get Mark, Brian, you guys want to add to that or we can you can pick a a a Q&A question in the in that Q&A tab to to address 'cause these are some really great questions from the audience. Maybe maybe just one clarifying point on what you just walked through. I think and you mentioned this when you were originally going through it, but you know $10 million per Bitcoin is in today's dollars, meaning today's purchasing power. So yes, if if inflation continues to sort of get out of hand 1020 thirty years into the future, the sort of nominal price per Bitcoin could be far higher than 10 million. But what we're saying and what Jesse is arguing in in this report is that he's saying $10 million per Bitcoin in today's purchasing power. So I think that's just an important sort of caveat to to include. There. Perfect. And the and on the on the historical side about inflation, you know, people think inflation, you know, hurts Bitcoin or even gold because it costs more to store gold or people will buy bonds and not buy Bitcoin. In the 70s, in that inflationary period, you saw Bitcoin return 14X. Equity. Sorry I'm I'm I'm projecting Jesse there and that's next decade mark so so such a clairvoyant and so it people finally. But they didn't wake up to what I love about that August 71 Sunday night massacre by Nixon is that markets kind of opened up the next day unchanged. We take a while to figure stuff out like in in O8 when the crisis was going on and DC was figuring stuff out. Our research team came up to the CIO when I was at a hedge fund and we said we think the number might be a trillion dollars of the bailout. We were wrong. It was 700 billion but no one had a trillion in their mind in O 8. So things have happened so fast that we just are lagging. This is a that's why I love this chart you have here because then you get to look at everything. Everyone's like, yeah, real estate's kind of a weird market now and and people are atomizing it and monetizing it. And yeah, money is slow. You know the velocity of money is slow and bitcoins faster. That that makes sense. Bankers understand that. And and that's the part that we have to do I think as as educators is is just take little nibbets and say it's not really working today and and it's not going to go away. But that little thimble, again, just keep an eye on it. I mean that's, you know, get curious. Do your own research. Get off 0. And that's why I love this, this this webinar and this page in particular. So I'll, you know, go back to the Q&A, Brian 'cause there's some good questions. Yeah, I I have, I have one Jesse from from David Lewis and he's I'll I'll try to summarize, but he's basically saying you know BTC is largely seen as a store of value, encourages people to hold it longer term rather than trade it and the creation of spot ETFs will have to physically hold the underlying asset. And he's asking ultimately here about the price multiplier effect and how does that, how could that potentially change this analysis. And I think that's another caveat to point out that you and your analysis did not account for any multiplier effect, but I know you have some thoughts on that. So that that could be interesting. Yeah, that's a great point. And and Gary Winters also touched on in in his question, what happens here with with the ETFs. And I I think for everyone out there who's who's curious like what's going on with these ETFs, all the first of all, it seems likely, very likely that they will be approved about a month from now at the next deadline. And that is at least according to the Bloomberg ETF specialists who have have pegged it at a 99% likelihood as of now that these are approved. And So what does that, what does that create for Bitcoin as an asset? It creates this additional tailwind because this is added demand. It's a it's a new channel for people to gain exposure to Bitcoin, which means additional dollars flowing into Bitcoin the asset because the ETFs have to purchase spot Bitcoin and hold it for their investors. And so that that's that's a tailwind that's happening right now. And and as that process plays out, you know that that's price discovery the the additional demand will go out and meet supply and that will change the price over time because there's more demand than there used to be And that'll be a slow steady process in my opinion. And then there's the multiplier question there of, you know, during a bull market, we do see that every dollar that flows into Bitcoin has some multiplicative effect on the total value of all the, all the Bitcoin that exists. Because if you were to buy 111 Bitcoin for $1.00 more than the previous trade, well, that new price point that that's $1.00 higher applies to all 21 million Bitcoin. And so in in that in that instant there's a 21 million X multiplier on your $1.00 of inflow. But that Nets out against all the selling pressure as well. And we see that in the bull market there's more demand than there's supply. That's why the price, then there's selling pressure. So that's why the price goes up and there is a some amount whether that's 1 1/2 to Bank of America at the very top of the last bull market quoted UP118X multiplier for every dollar of inflow to Bitcoin. But my perspective is that the bear markets wash that out and so the same negative multiplier effect happens in the bear markets. And I think that we reach you know effectively either A1X or you know something below, below 2, below 2X. That's my sense because the alternative is that if if 50% of the value in the global asset landscape flows into Bitcoin and it's a it's 100 X multiplier, you've suddenly grown the total value of all that wealth in the world by 50X and that that just doesn't make sense. So I think that over time, you know the the the amount of purchasing power can't expand just because there's a multiplier effect. Ultimately wealth is a representation of your what percentage of the world's resources you can command with that wealth and it doesn't necessarily mean growing the pie. Gary Winters also asked you know where are we in the four year Bitcoin cycle if if you know this is based on if increasing scarcity that happens every four years is the the main driver and and so Gary, I I think that you know we are we are where we have always been a few months before the next having which is to say we've gone through 3, 1/2 years. Of. Volatility that was triggered by the prior having, so you know the last having was in 2020. We saw volatility to the upside over the ensuing 18 months and then volatility to the downside in the 12 months that followed that. And since then we've been kind of stabilizing somewhere in the middle and that's what has happened after each having historically for the last 15 years and here comes the next having coming up in in four months, now 4, four months and change. And my expectation is the same process will play out of volatility to the upside, a bull market and there will be you know volatility to the downside afterwards and we'll find some sort of equilibrium in the middle only for the next having to arrive four years later. And so you can see how that, that process is the the value proposition of Bitcoin as a savings technology. Yes, there's volatility along the way, but if you can hold for four years or more, you end up at a higher point than you were. And so that's I think where where we're at, which is to say that I'm I'm cautiously extremely optimistic about 2024 into 2025. Yeah. And just maybe another comment going back to what you were saying around the approval of ETFs. Jesse, You know, I think it's certainly going to be impactful just from the sort of purely functional dynamic of of these issuers having to go out and and buy spot Bitcoin and that that'll be a a near term price catalyst for certain in my mind. You know, I actually think the bigger element here is more from a narrative perspective. You know, I think there have been ETF applications out for, for several years now and and I think there's been, you know, there's been a reason why that they've, they've been sort of hesitant to be approved. And I think part of it is that they know once they are approved, it significantly shifts the narrative for institutional allocators, not just in the US but around the globe. When you know the most prominent regulator in the world signs off on this thing and gives it the green light, I think the narrative impact, you know is is arguably more important than sort of the the driving spot demand impact. But Mark, I'm curious your thoughts on that. So on the on the ETF, we'll go back to it's going to happen. And the reason why we think it's going to happen, and I'll go back to your question Brian, is because a judge ordered it and for everybody who's still looking at the SPF debacle, which you know, he only got clinked up here in a month ago, that's natural. And they're missing what's going on. Bitcoin went through its default cycle where the bad actors got stripped away from the good asset and it went through the court system that was critical. So that's that narrative, Brian. It's it's it's well earned because it's not just coming from now influencers, but from a judge. A federal judge called the SEC's argument The last word in her 21 page opinion on August 29th was the word unlawful. I mean it was a it was a crazy argument about futures versus spot that made no sense. She called it arbitrary and Capri and capricious. We all know that term now used eight times and the fact that it was more than a rolled up newspaper that she took in her opinion to smack Gensler right in the nose with the last word was unlawful. In other words try me. And that's why they didn't appeal in October and bitcoins gone up since for good reason. So that narrative was started by BlackRock in June when they filed I think in support of Coinbase when they got Coinbase got sued 2 weeks prior by the SEC and that's an as a business people they have incentive, they realize that they see the skew, they know it works really well in a balanced portfolio. They're going to just get their advisors out there into the sovereign wealth funds to put in there in the in into their portfolios that's why they're doing it. But later when the courts heard it, they had no choice but to use the rule of law. And that rule of law is really what we why our conviction is high, why we finally came out with only after Jesse and team here with it, with evaluation, because you have to speak price because now it's going to be institutionally adopted. So that's it. People aren't going to understand Bitcoin. I don't think unfortunately before they buy it, they're just going to listen. BlackRock buys and they're going to do it. And that's why we're doing this because you can be shaken out and you know, we can go back to the questions, but we don't want you to buy it because BlackRock does it. But we're going to tell you that unfortunately that's what's going to drive adoption for the, you know, for the near term. Yeah completely agree with with all that and and and and and Mark appreciate your like extra level of insight and awareness of all the machinations going on behind the scenes about about why the ETF approval is imminent because I think it I I'm I'm personally guilty of it has been so long with you know ETF proposals being last second denied that I I sort of am lulled into a false sense of you know ETFs are nowhere near but the reality is they're they're probably one month away And that's not to say that that will you know suddenly lead to a a spike in bitcoins price on the day but it will at that point in time and going forward add a tailwind to Bitcoin. There's a there's a great question in here from from Mark Quigley about you know what are the considerations in various Bitcoin investment vehicles, these ETFs, how they can stack up versus each other and and then you know what are what's the right offering to get exposure to Bitcoin with and and Mark I I think I think the the high level answer is, is buyer beware first of all because there are certain clauses. I took a a a close look at the Bitcoin at the BlackRock S1 in June and put together a report that's also available on the on RAMP Bitcoin website about the shortcomings of that proposal. And you know, it comes back to the the fact that Bitcoin has certain properties that are extremely desirable and the way that most ETFs are are done kind of undercuts some of those advantages of of holding Bitcoin as an asset. For example, can you take in kind redemption from from these investment funds? They'll all have slightly different approaches to it and and the SEC has been pushing back on that. So some have caved on allowing that at all. BlackRock is sort of taking fighting on that and trying to stick up for that which is an interesting development. But still within still with these major asterisks of only authorized participants are allowed to withdraw Bitcoin in kind and and that ultimately means that there's a small list of broker dealers who have a separate agreement with BlackRock who are white listed and and allowed to withdraw Bitcoin in kind. Everyone else has to withdraw dollars, which means you have a taxable event when you're withdrawing. So if you want to go from from some of these ETFs or some of these investment funds, GBTC today for example, if you want to go from that fund and then take control of your own Bitcoin, you have a taxable event because you have to sell your your position in that fund into dollars taxable event and then use those dollars to go buy Bitcoin. So you could in that one moment, you know. See your Bitcoin holdings cut by 30%, so they're not all created equal and it it's hard to tell on the surface what are the potential pitfalls of them. At at on RAMP, we have a a private placement trust that is designed to to keep as many of those qualities of Bitcoin that are desirable to investor as possible in kind redemptions without a taxable event being a major one there. So do your research I guess and and know that in particular folks who are coming from traditional finance and the traditional ETF world are structuring these products to to fit Bitcoin into what they know. And that doesn't always work because Bitcoin has these other properties. And so Bitcoin native companies or or at least people who understand Bitcoin deeply, when they create a a a vehicle it you're you're likely to have much more attractive properties for that vehicle. Mark, anything you want to add to that or? Yeah. So I'll focus on the on the ETF and then bring it out to what you just did is the spectrum of qualities that are muted in certain regulatory wrappers like an ETF. So the ETF is you know is constructive. We have them. We have Bitcoin funds at our firm. Fred Pie found this you know took the regulator to a open court in order to get it done. And he and in the spirit of what you said about trying to capture and transfer the as much of bitcoins unique properties our Bitcoin fund does allow for in kind redemption. So you can take it on the annual redemption. You know ETFs offer liquidity for this round. I agree with you is you would love to see the ability to have in kind but I I don't I don't think you're going to see that. So the fee part certainly important. The other one though is just tracking error. So you you you want to be able to see not right away but over time are they compounding your dollars well and you know I guess back to what you're saying, it does serve a purpose, a regulatory wrapper for one thing. The other one though is eventually even our firm which provides regulatory products which means that they aren't custody like yours, we offer courses or or not courses, but but we do talk to people about self sovereignty. That is the ultimate goal. And so we think the ETFs are a step along that way. So we don't discount them. It is my business. So we're talking my own book up a bit here. But we recognize that it serves a purpose but as you said know what you're getting know it's how it's structured, which is no small potatoes. And you guys, I'll leave that to you because I think you are that end game about about offering that to clients. So thank you, serve a great obviously role for people. I think we started the call off with Cam talking about it. Custodianship is the hardest concept to understand. So BlackRock is saying I got you 3 IQ says I got you, yes. And understand it because it's not, it's. It's not the same process as ADTC. Eligible security, yeah, Yeah and and and we're we're slightly over on time here so we'll we'll shift into the wrap up phase. But to that point if anyone out there is you know curious to to talk more about specific considerations that that you have with your certain circumstances with regard to these products or on RAMPS products. We would love to talk with you. So you can schedule a consultation with us just reach out to on our website big button right there to schedule a consultation and talk with one of us about your particular concerns or situation and Yep and the the the link for that just popped up in the in the chat window there. Mark, I know you, you, you wanted to make sure to talk about something that you were, you know, wanted to put in a a pitch for. Sure, so the our problem remedy and urgency. The urgency is flashing a bit here with the ETF and we have a 12 page document called the Advisor's Care Kit. Basically when you get that call from people saying what, what's going on with Bitcoin, I want to buy it, but I heard about it's used for crime etcetera. So all of that talk that Jesse and Brian talked about that's incorrectly you know all the shade being thrown in Bitcoin by people trying to protect their own turf because they're not incentivized for bitcoins growth whether it be energy use etcetera. We have a a quick answer so you can get capture that order and not have them sell equities and buy Bitcoin away. So it's it's a way to preserve your book as an advisor because the demand is coming and you have to answer the call. And and where can they find that report mark? That would be on our It'll be attached to our weekly, so it'll be in our website threeiq.ca tonight under Research and Insights. Right, fantastic. And and yeah, sorry we didn't get to everyone's Q&A questions again. You know, please schedule a consultation and we can have a one-on-one conversation with you about about any of your questions and concerns. And again this report, the Bitcoin's full potential evaluation is available on our website. At the top there there's a button you know that says Bitcoin's full potential evaluation. You can also find it in the link in the chat and and Brian if you want to talk about webinar series going forward, yeah, we we are hoping to do this on sort of a quarterly cadence and. We'll sort of be covering different topics ranging anywhere from, you know, Bitcoin's fundamentals to just various ways to the to be thinking about this asset. And it'll usually coincide with some research reports that we've written. So really excited that everyone was able to make it for this first one and hope that you'll make it for the next and and just wanted to say a special thanks to Mark for joining us. It was a great conversation and really appreciate it. Yeah. Thanks, Brian. Jesse. Thank you, Mark. It was awesome. Well, that's all we have everyone. Thank you for joining and hope to catch you next time. Thank you for listening. If you found the information valuable, please share the episode with a friend or leave a rating on your favorite podcast app or on YouTube. All the links we discussed in today's webinar will be in the show notes. Regardless of where you are on your Bitcoin journey, we'd love to hear from you. Visit on rampbitcoin.com Contact to schedule a consultation with one of our private client advisors.