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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. All right, welcome back to another episode of Final Settlement. Super special episode today very excited for this one been looking forward to it all week and we have Pierre Rochard in the show and so I'm sure many of many of our audience members will will know who Pierre is and and know of his work. But in case you're unfamiliar here, Pierre has been at the forefront of of Bitcoin advocacy and and really education for over a decade as a, you know a very early adopter of Bitcoin, a prolific writer, a Co founder of the Satoshi Nakamoto Institute. He's really played a a critical role in sort of shaping the intellectual foundation of of Bitcoin in general over the past, you know, over a decade. And so, you know, he's also helped sort of Dr. institutional adoption and education through, you know, his work in the corporate world, most recently at Riot platforms. And so we're really excited to dig into, you know, his journey, his views on bitcoins future and in particular the the Bitcoin bond company, which was announced recently that Pierre will be, will be launching soon. And so very excited to to dig into all of that and maybe a few other topics because there's no shortage of, of things happening in the Bitcoin space right now. It feels, it feels a little overwhelming at times the the amount of the deluge of news on a on a daily basis. But Pierre, welcome to the show. Thanks for thanks for joining us. Thanks, Ryan. Thanks Liam for having me on. Yeah, Well, let's, let's get into it. I think, you know, a logical place to start is, you know, sort of what preceded your vision for the Bitcoin bond company, which I think is, is something that's been rattling around in your brain for for over a decade. And so you wrote a piece back in 2014 called Speculative Attack. And so maybe, you know, just for the audience, if, if you could give a brief overview of, of what your thesis around sort of speculative attacking the dollar with Bitcoin was at that time. And then sort of maybe talk about how that's evolved over time over the past decade from when you first had the these ideas and into, you know, where we sit today, Everything that's going on from corporate adoption to sovereign level of adoption. And you know, one, I guess has, has, have things gone according to how you thought they would? And then beyond that, you know, how did that influence how you're thinking about things going forward? Yeah, absolutely. So I think that the place to start would be back in 2005, I was a high schooler and I stumbled into Austrian economics and sound money. And what I really liked about that was that they had an explanation for the business cycle that actually made sense to me versus some of the alternative explanations that I heard in school. And that that drove me to really being a silver and gold type, you know, focused, you know, intellectually, right? But at the same time, I was really interested in free and open source software. So I was installing Linux on computers and listening to Richard Stallman lectures on the philosophy of users controlling their own code, and I didn't think that those two paths would really cross until my last year of grad school. I was getting my master's in financial accounting here at UT Austin and got introduced to Bitcoin as sound money, that there would only ever be 21 million and that it was open source and so this monetary policy had credibility to it. So really went down the rabbit hole at that point and started writing about Bitcoin from my perspective, which was very focused on monetary economics and wrote a series of articles leading up to speculative attack, where on speculative attack, I really wanted to dig into what's the end game for Bitcoin and how does it ultimately prevail in currency competition. And so in the world of monetary economics, there's a concept of a speculative attack. The, the term was coined by Paul Krugman of all people. And he, he, he was looking at it from an academic perspective of what had occurred in the Asian currency crises that were in the 90s. And the the broad strokes of it is that you have investors who are borrowing in a weak currency in order to sell that weak currency and buy a strong currency, have the strong currency appreciate in value, and then sell the strong currency to pay off the loan that was denominated in the weak currency. And that this has the effect of first of all, creating more weak currency because when you're doing a loan through the commercial banking system in a fractional reserve Fiat system, they do create more currency. And that the, the, it's, it's a cycle where the weak currency can either be defended by raising interest rates. So that just makes it more expensive to, to borrow it. And so then the the carry trade falls apart or through capital controls where the Monetary Authority will find ways to clamp down on the the speculators and to prevent them from borrowing the weak currency or by defending it using currency reserves. And so having having the strong currency in reserve that they can use to stabilize the exchange rate and to make the trade unprofitable for the speculators. So with that framework in mind, I, I looked at it through that lens of, well, what would it look like if people were borrowing in, in this context, the strong currencies, Bitcoin. So they're borrowing the weak currency, which might be dollars, it might be Swiss francs, you know, which is generally thought of as a strong currency, but not as strong as Bitcoin or Indian rupees or, you know, Turkish lira could really be any currency that they're funding the trade with. And that that would be the end game for Bitcoin in the sense that it would it would wreak havoc on the currency markets and cause all of these weaker currencies to hyperinflate and to disappear if if they were not defended. Now, what we've seen over the past 12 years since I wrote that is that indeed there has been that dynamic. And the ultimately the limiting factor for it has been the the one limiting factor that I did not write about that I didn't even think about was the fact that so many people would make so much money off of the strong currency, off of Bitcoin, appreciating that they actually want to rebalance their portfolios even if they're not involved in the speculative attack at all, right? So they want to rotate into, unfortunately, sometimes altcoins, right? And they want to ride some kind of altcoin wave, or they're just buying stocks and bonds or paying off their mortgage or putting their kids through college or just taking chips off the table after, you know, a 10X or 100X. And so we've seen lots of people, they end up regretting making that decision because then, you know, Bitcoin recovers eventually. But that's, you know, what drives a lot of the selling at the top of the cycle. But we also have seen with after the covet inflation, U.S. dollar monetary policy tightened and so we saw a rate hiking from 0% to 5% and we also saw capital controls. So this was what we described as Operation Choke .2 point O where the banking system and the the wider financial system, because we could include the SEC not approving the Bitcoin ETF in this kind of capital control where they're trying to gate investor access to the strong currency in order to defend the weak currency. Although maybe they consciously didn't think of it that way. That would the the effect of that. And also, you know, that they were able to seize Bitcoin through, you know, the criminal justice system and develop a currency reserve of the strong currency. And we also saw them, you know, selling off Bitcoin, which had the effect of suppressing the Bitcoin price. So that that was now all of this is, you know, in flux now with this new administration. So we're we're looking at lowering interest rates, removing capital controls and building up a reserve instead of selling one off. So I think that, you know, bitcoins going from headwinds in that regards to tailwinds. And so I think that in, in many ways the speculative attack is going to continue unabated. But I think that my, my thesis was really that it would cause the dollar to collapse. But I, I now I wonder if that's actually not the case in the sense that if we're building up a reserve of Bitcoin, that the dollar ultimately could just be backstopped by Bitcoin and that it becomes a, a proxy for Bitcoin. Maybe one day we'll have like $1.00 = 1 satoshi equilibrium. And it's all, you know, 100% reserve and the dollar is just an overlay on top of the larger Bitcoin monetary system. You know, in terms of like what I got wrong with the speculative attack, I think was really something that should have been obvious at the time, but I, I didn't really think through this part of what are the speculators borrowing against. So I had it in mind that they were borrowing against traditional financial assets, whether it's treasuries or mortgages, real estate and the like. But I, it didn't cross my mind that they would actually be using Bitcoin itself as a collateral, which, you know, what better collateral could you ask for than than the hard currency itself? And so that was probably the, the biggest missing piece of in, in speculative attack. And also, what are they financing? What are the financing mechanisms specifically? I limited my my observations and my thinking to the commercial banking system. And so there, you know, they would only really accept traditional forms of collateral in the commercial banking system. Sailor opened my eyes to the fact that you could actually use the equity markets to to be the financing mechanism, you know, outside of the commercial banking system. So that's, you know, in at the same time that I was writing a speculative attack, I was working in the traditional financial system. So I was working at Deloitte, sorry, auditing mortgage-backed securities and other kinds of new issuances of securitization transactions. And even back then I thought even though I didn't write about it in speculative attack, I did have an Excel spreadsheet open of what would it look like to securitize Bitcoin and to put Bitcoin as collateral and to issue bonds against it. It was way too early one on the regulatory part where the SEC was not even approving the Winklevi Twins ETF back then. But also just in terms of the maturity of the market that, you know, the there was not a broad acceptance of Bitcoin as a store of value, as a digital gold that that really emerged over the subsequent 12 years. So now now is the right time though. So that's why I decided to found the Bitcoin Bond Company and to to pursue this dream I've had of issuing bonds to finance Bitcoin. Yeah, that's. Very well said and many of the people that have been selling their bitcoins after their 110X gains definitely have not read the Satoshi Nakamoto Institute about hoarding bitcoins too. Which was definitely prior to the speculative attack and, and that whole line of research too. But yeah, on that point, I guess like over time you've, you talked through a bunch of different ways to borrow against Bitcoin. I guess can you speak to what you perceive as a trade-offs between personal and and localized spec speculative attacks versus the the corporate and and pulled speculative attacks both in terms of access to liquidity and you know what the the end benefit can be to the? User and also just to add to that, sort of like the, you know, how these ideas and concepts have evolved because like I remember, you know, I first started learning about Bitcoin in sort of 20/17/18. I didn't have a lot of money. I, I didn't have a, a massive salary, but I was personally speculated speculative attacking the dollar by just taking on credit card debt and buying Bitcoin with my entire salary effectively. And so we've gone from that like individuals taking it upon themselves to do this to now corporates and nation states thinking about these strategies. Yeah. So I think that individual like retail buying of Bitcoin and leveraging up you know in various ways at at the individual level is going to continue. I would caution folks that that does come with risks, right? That you're, you're on, on credit cards, you're, you're paying a higher rate of interest then, then, then you can access at the institutional level of, you know, there's essentially an economies of scale part where they have a lower cost of financing, but also there's a, a structural part that they, you know, there's the difference between personal credit risk and corporate risk. And so when on the lender side, when they're underwriting these bonds that are loans that it just comes with different risks, right? So, and also at the individual level, we've seen products like margin trading at exchanges where there you have a risk of getting liquidated if Bitcoin flash crashes. And so I think that at the individual level, it can really be challenging because of, of the different economics. Then, for example, Sailor can have with a convertible bond where it's just a completely different ball game. And so in, in some ways, I think it'll continue at the individual level. I, I would encourage people to, to do it in a responsible way where they're just focused on spending less than they earn so that they can plow their free cash flow into Bitcoin. And, and that that's, you know, you got to stay humble and stack stats. And then at the corporate and institutional level, I think that's where because you know, it's a limited liability company and that they, they, they have, I would argue perhaps more expertise in leveraging up and access to different products that might be a little bit safer to leverage up that they're going to be at the forefront, the tip of the sphere of the speculative attack. And that you know it, the financial engineering does does take a lot of nuance at that scale. 100% and there's also legal and controls that are in place that can help get lenders more comfortable with lending to large corporates rather than individuals like myself. If I just went to a bank and tried to ask for a big loan to buy a ton of Bitcoin. But you know, Liam, that that that might be changing now that the the Fed recently, just today or yesterday announced that they're going to allow commercial banks to work with Bitcoin. So it might not be long before we can just deposit Bitcoin at JP Morgan and take out a mortgage against it. Essentially that because you know, from the risk perspective, I think that the biggest risk is essentially term risk, right, that bitcoins very cyclical. So if you're taking out a loan that's a one year term, then you could be underwater after one year and you can't refinance it and then you're in trouble. If you get out to 510 years now you're you're really going through the cycle. And that if as long as there's no liquidation clause in that, that now it's I think a much more constructive relationship between the lender and the borrower and maybe less extractive. 100% yeah. There's something to be said about just keeping dollars in your checking account and Bitcoin in your savings account with banks moving forward as well. Yeah. Yeah. One other question is like in the past you discussed roughly like micro strategy imitators being not too far behind similar and metaplanet were early on and and 21 capital this week. On a long enough time horizon, you said we we should expect the share of the equity market participants adopting a similar strategy to to trend to 100%. I guess like why do you think this is the case? And how do you see different Bitcoin corporate security vehicles kind of changing over over time? And I guess like on top of that too. Anything you could share about the M NAV and how long this arbitrage can take place would be helpful. Yeah, so when, when when Sailor first announced his first $500 million buy, I was working at Kraken and I remember we we had a webinar and one of the questions was like, what's your, what's your craziest prediction for, for the year, which mine was that, you know, half the SP 500 would imitate Sailor and and, you know, go all in on Bitcoin. That did not pan out and so. Add that to the long list of overly bullish predictions that Pierre Richard has made. But the the principle I think still stands that on a long enough time frame that will be true. And it's true because these companies are either going to be decapitalizing themselves and not have not have access to capital anymore because all the capital is going towards Bitcoin companies. And so I think that they would end up either getting acquired by a Bitcoin back company or, you know, you've got an activist shareholder telling them to put Bitcoin on the balance sheet. And that the the second part of the question I forget now. I guess how long do you think that the arbitrage can take place and do you think this is something that can do you see like I'm NAV kind of trending towards one or yeah, what's your view there? So this is something, you know, I I learned about securitization before I learned about Bitcoin. And one of the most counterintuitive things about that that world is that when you, let's say you're just repackaging a set of mortgages, you would think that the total value of the securities on the liabilities and equity side of the balance sheet would equal the total value of the assets on the collateral side of the balance sheet. And to my surprise, that was not the case. You do end up with a premium to the NAV. And the reason for that premium is because contrary to what a lot of Bitcoiners think, but also just I think the average layperson assumes financial engineering does create value. And so by tranching up the risk return of the asset, you're able to grow the pie of people who want exposure to the asset. And so that's really where the M NAV multiple comes from. And then we're also there's a speculative element when you're talking about it in the terms of, you know, a liquid equities where you're, you have to think about how will Sailor or anybody else be able to manage the capital structure in the future to further drive value to the equity tranche by taking on debt and by leveraging up. And so to me, the M NAV is, is the combination of today's leverage with tomorrow's possible leverage because we're, we're, we're discounting future cash flows. And so that's where I think it comes from. When does it go away? Well, I, I would argue when we've succeeded. So when you know, the, the dollar is at SAT's parity and that we've reached an equilibrium between the Bitcoin and the dollar. If, if, if U.S. dollar policy makers are prudent and have a path to that equilibrium. If they are not, then I fear that the dollar will trend towards 0 and the M NAV in in you know dollar terms will will continue to to exist. So. Maybe sort of an extension of of what we're talking about. What I'm curious to get your thoughts on is, you know, from the perspective of any sort of company or entity, it's completely rational to adopt A strategy, right for the good money and, you know, effectively short the bad money. And what we've seen over the past 12 to 24 months is, is, you know, increased sort of perpetual new adoption of this strategy. And I guess in my mind, I, I struggled to, to think about, you know, is there a point of saturation effectively where we don't need all of these different tickers that are Bitcoin treasury strategies? Obviously, again, from the company perspective, totally rational thing for them to do, but from like the perspective, shareholders perspective in your mind is like, does most of this flow towards the largest player, IE strategy? And then like beyond that, there's obviously advantages to specific jurisdictions, right? So like if you think about a metaplanet, they're the only one there. So that's why I think they have an advantage in that respect. But maybe if we're just thinking about the United States, like if we wake up in five years and there's a hundred different companies doing this strategy, does that impact, you know, what M NAV looks like for the long tail of these these companies? Because most people will just go to the largest one that has the most flexibility and optionality to tap capital markets to do these things. Yeah. So I, I think I, I agree that if, if other entrepreneurial publicly traded companies don't find ways to differentiate themselves from strategies approach and the capital structure that sailors developing with, you know, strike strife and the converts and you know, we'll, we'll see what, what else comes out of their, their, their quarterly call that that's coming up. I think that if they don't find ways to differentiate themselves, then it is challenging because of the liquidity network effects right where now we have even a layer on top of MicroStrategy of the yield farming, if we want to call it that, the volatility harvesting with MSTY and IMST where you know, you do need to have a liquid options chain to, to be engaging in those activities. And so it becomes a flywheel effect that becomes really hard to, to challenge on top of the fact that how do you acquire 500,000 Bitcoin? You know, he's, he's, he's very far ahead of like #2 or #3 or #4. So I, that said, there are lots of other very smart people in the world who could find a differentiating angle and maybe could have ways of approaching this that, you know, for example, for myself, when I, when I think about it from, from my securitization background in the debt side, that's where, you know, the way I think of differentiating with the Bitcoin bond company is by just doing all debt and no equity and essentially redistributing the equity to the bondholders, which is something that a publicly traded company just can't do just because of the path dependency that they're on that, you know, they're, they're on the, they need to accrue value to the shareholders of the common stock. And so, and that's the fiduciary mandate. And so, you know, in terms of accessing different pools of capital, I think that there are differentiated strategies that are possible. Some of them we could think of today, others will be caught by surprise, you know, tomorrow the like, wow, why didn't anyone think of that sooner? And I think that, you know, that was, that was the experience with micro strategy of, Hey, why didn't anyone think of doing this sooner? Because there were publicly traded vehicles before strategy, you know, tackled this. So there's also, you know, maybe and I, I personally, I, I like the approach of just keep the Bitcoin in cold storage, you know, don't try to get fancy on on the collateral side. Maybe some will take more risk and try to generate yield off their Bitcoin or offer, you know, kind of different approaches on the collateral side. Even, you know, we've heard of people trying to do this with Solana. Obviously as a Bitcoin maximalist, I think that, you know, they're building on sand and that that's really going to underperform strategy. But from a narrative and marketing perspective, maybe they attract a different set of investors. You know that I I hope that answers the question. Yeah. No, that's, that's all super helpful context and and thinking around it, maybe maybe we can sort of pivot and and jump into more about the Bitcoin bond company. So maybe just sort of high level, how you're thinking about it, what types of credit instruments you're planning to offer and how you're thinking about distributing them, various sort of cohorts and investors that you think are going to be interested in this and we can just sort of start high level and then we'll dig into some details. Yeah, absolutely. So I think that what I'm interested in is shifting the Overton window and that's, I always try to find kind of what's, what's the hardest thing to to work on right in, in Bitcoin. And I enjoyed doing that a lot with Bitcoin mining and the environmental impact, you know, with Elizabeth Warren and, and her her goons, as I think President Trump put it. So on on the capital market side, I think that the, the hardest shift is, is in the bond market because that is where the most conservative investors are. And so sailors taking a crack at it with the converts. And I think that that that makes a lot of sense. It's still, you know, when we think about the convertible bond market, that's a a subset of the overall bond market that the natural buyers of that might be arbitrage traders who at the end of the day are, you know, very active in the equity markets. And so it's it's as adjacent to the equity as as one can get in from a bond perspective. And so I'm really interested in going deeper in the capital stack of finding ways to open up the Bitcoin conversation with institutional investors who might balk at the volatility of spot Bitcoin and also not have a mandate to invest in a commodity, right? From a regulatory perspective, that's what it's categorized as, for better or for worse. Even if it were categorized as a currency, they still wouldn't have a mandate to hold a currency. And they're focused on credit instruments. So first of all, providing A wrapper around Bitcoin that is credit focused and doing it in a way that is also institutional grade, meaning that it's inside of a bankruptcy remote SPV, there's no counterparty risk, corporate risk, you know, the way the traditional financial institutions think of that as bitcoiners, we think of counterparty risk very differently, right? We think about you got, you know, not your keys, not your Bitcoin. That's that's not how a traditional financial institution thinks of counterparty risk. And so beyond just having the the wrapper of bankruptcy, remote SPV, also having the risk transfer in the capital structure, So being able to tranche up the risk so that there's a senior tranche that appeals to somebody who wants an instrument that's over collateralized, they're willing to give up upside in order to achieve that that risk mitigation. And then on the other end of the spectrum, the the junior tranche that essentially wants to go leverage long Bitcoin while still having yield visibility so that they they they have a, a percentage number to it, but that in terms of participation in the profit share, if Bitcoin really, you know, hits a home run, that they are strongly participating in the upside. And so then in the middle of the mezzanine, which is really, you know, okay, for the credit fund that they're constructive on Bitcoin, they might not necessarily buy the moon math of Bitcoin going to $1,000,000, but they, they think that Bitcoin is going to continue to perform pretty well that way. We're, we're opening up Bitcoin's risk return profile to a wider set of investors that that has, you know, not had access because frankly of the regulatory roadblock of the SEC just not wanting to approve this for even a spot ETF, which should be uncontroversial. But now I think the new SEC is merit neutral. They're not going to prejudge any of the securities as long as everything's disclosed on the up and up that they're going to approve more innovation. That's really helpful to understand and think that's a smart way to go about it. So multiple different cohorts can get different types of exposure. I guess if you're comfortable sharing, would love to hear a little bit about how you think collateralization as well as kind of terms and the timing of these loans and vehicle. That all goes into areas where there's a fine line from a regulatory perspective of what I can talk about and what I can't. I think that in terms of over collateralization, it really is about making sure that it, when we look at Bitcoin's price history, the worst performing and, and I I like the number of five years just because that gets you through the traditional Bitcoin cycle. The worst performing five years was December of 2017 to December 2022 where you round trip to let's say 20 grand because that was the top of the cycle to the bottom of the next cycle, you know with Sam Bankman freed and all of his shenanigans. And so if you look at that worst period, you could say, well, as long as you're decently over collateralized on the senior, the principal and interest in that scenario would have been paid on the senior and that the junior tranche would have gotten wiped out because they would have contributed to up the stack interest on the senior in the Mes. And the Mes would likely have taken a haircut on the interest, but they would have gotten their principal back. And so that I think, you know, when we're thinking about putting ourselves in the shoes of, of a, a, a bondholder that is looking for something that is, is, is mimicking or close to investment grade, they, that's what they want to see. Is that it now in, in between, right? That's where, when we look at during the life of the vehicle, that's where you want to make sure that there's no liquidation. Because ultimately, if you underwrite something at the top of the cycle and it grinds down for two years before recovering for three years, if you sell at the bottom, you realize losses. But if you don't sell and you have a recovery rate and you have a constructive view on that recovery rate, then you can hold through the cycle and ultimately create value for the whole capital stack. And so I think that's where it's important to have a vehicle that is not liquidating at the at the bottom of the bear market. But you know, it has a longer term view that bitcoins going to continue to be around every 10 minutes, a new block gets added to the chain. And so there's not really a real physical impairment of the network itself. It's just that there's there's a cyclical adoption phase for Bitcoin. Got you. Yeah, that, that makes a ton of sense. I think maybe one, one question just turn in terms of how you think about demand for these products in these structures and the pools of capital that you expect to to come into this. Because in on one hand, you know, I think part of part of my mind goes to well, you know, someone who's looking for sort of downside mitigated a little lower upside exposure to Bitcoin doesn't really fully understand Bitcoin. Otherwise maybe they would just outright buy Bitcoin. But obviously there's cohorts and swaths of the investment world that have a specific mandate and they need to be investing in credit or bond instruments. So could you speak to that a little bit and how you sort of would handicap the sort of landscape of demand for products like this? And you know, would you agree with like that notion that, you know, at least some portion of that if they if they don't have a specific mandate, we'll just wake up one day and be like, well, why would I want capped upside? I'll just own the thing out, right? Yeah. And and so they now have access to BlackRock ETF and that's a great product for them. I think that in the institutional context, a lot of investment decisions are not made by one individual. They're made by a committee. And to get consensus on the committee, you sometimes have to negotiate. And so that's where, you know, you might want to have a product that does cap the upside in order to have have the over collateralization and to protect the downside in order to get it through a committee where you might have a lot of different views on Bitcoin. And so I think that that's where you know, having the right product for the right audience matters a lot. The and so that I think is the short answer, the longer answer, or maybe it's not that much longer, but in practice it will be longer. It's the education, right? I love doing Bitcoin education. And so this provides a product where for these institutional investors, they might not necessarily be interested in Bitcoin education if there is not a product behind it. And so getting, getting the foot in the door is, is important there. And if at the end of the conversation, they're like, hey, Pierre, we're, we're happy about what you're doing. We we like Bitcoin, but we're going to buy a spot ETF. You know, I'm really happy about that outcome, even if it's not my product or what I'm talking about. At the end of the day, I think we're all on the same team. And so that's the same way I see what sailors doing with strategy and what Jack Mullers is doing with 21. And you know that that it's all about driving Bitcoin adoption in general. Yeah, 100%. I'm glad you said that because, you know, I think it's easy for folks to get wrapped up in a line of thinking that I, I personally struggle with this line of thinking. But like that somehow any of this adoption from the corporate and sovereign level is, is somehow a bad thing. Like you do see these takes on Bitcoin Twitter though, where it's like, oh, like, you know, the institutions are Co opting Bitcoin and it's just like, well, you know, if you step back, like, well, how did you think this was going to happen? If if Bitcoin is to become global money, obviously institutions, nation states, corporates are going to get involved. And so like this is, I think how in my mind, how it was always going to play out. How do you have any thoughts there just in terms of like, yeah, yeah, should there be any concern about any of this? I I personally don't think so. I think everything is good. Bitcoin adoption, to your point, the education I think is a massive factor here of like, OK, SoftBank is getting into Bitcoin. That is a massive signal for institutions, high net worth folks all over the world to start Start learning about Bitcoin. Yes. So two thoughts on that. One is that over the past 12 years I've developed a tremendous amount of conviction on bitcoins decentralization. And so whether it's large Bitcoin miners like Riot or large custodians like Coinbase, I think Bitcoin is anti fragile. We we saw it with the failure of Mount Gox in the early days like that did not destroy Bitcoin. The failure of FTX did not destroy Bitcoin. So I, I think that I, I have no concerns on, on the Bitcoin side of things. My concern is really, you know, for example, the the teachers that have been saving up through their pension fund and they are relying on that to retire and that if that pension fund is underperforming or, you know, just doesn't have enough Bitcoin exposure that it undermines their purchasing power in retirement. Do we as bitcoiners, do we want to say, oh, I told you so you should have been buying spot Bitcoin and putting it on your hardware wallet and running your own Bitcoin node. And you know, too bad for you that you put your money in this pension fund. Ha, ha, right. Like that to me is not a great outcome. It's, it's also, I think it's an immoral outcome like that. We, we don't want to have a society where the, the teacher or whoever is the end recipient of because again, these financial institutions, they're aggregating capital from normal people, right? And so through the division of Labor, that's the position that they are in. And they have a mandate to help normal people, whether it's an insurance company that's going to, you know, pay out claims or it's a pension fund or an endowment or any other kind where they, they're on a mission. And that I really see Bitcoin as a way to help them accomplish their mission and that to deliver the results for their constituents. So I think that it's, it's crucial to have them have a financial exposure to Bitcoin because I think Bitcoins going to be the best performing asset for the next 10 years, right? Just as it has been for the past 10 years, and finding a way to build a bridge to them so that they are actually benefiting from Bitcoin in the same way that all of us sovereign individuals are. They're well said. Yeah, there's, there's a lot to be said about the, the timing of this company launch too. I know the, the regulatory front is, is definitely shifted from where it has been, but I guess like there's, there's a lot of shifting perception of Bitcoin as well. I guess. Do you have anything you would like to share with the, the timing of the launch of of this company? It's obviously something that you've been thinking about for for a long time. Yeah, the the, so, you know, the SEC having its hand for us last year and, and approving ETFs, I think that that that certainly shifted the, the acceptance of Bitcoin as an asset in traditional finance. And so now we have Larry Fink on national television saying things that are unimaginable, you know, 10 years ago of Bitcoin sits above governments. You know, Can you imagine the CEO of BlackRock saying that it's just, and then having the, the president of the United States say, oh, Bitcoin is a strategic asset. You know, the, this is the kind of, for better or for worse, the, the kind of social acceptance that is necessary in institutional finance to make progress for Bitcoin as an asset. And so the, I think the timing is perfect in that regard as well. And at the same time though, there's lots of work to be done right. So I, I don't think that it's an immediate overnight success. I think that there's lots of education that that needs to happen to, you know, to, to, to further bitcoins acceptance, because that's also why there's so much upside for Bitcoin that all of these institutions have a 0% allocation to anything Bitcoin related and that it's only going to go up from here. Yeah. And and that's, that's exactly right. That's that is the opportunity, that's the asymmetric information based on publicly available information that, you know, people are just still very slowly waking up to. I think one of the more interesting things really over just the past couple months or so, I would say is, you know, people like to talk about this divergent, the decoupling from risk assets. You know, I don't put a lot of stock in any short window of data, but I'm curious your thoughts on that dynamic because you know, once I started really understanding Bitcoin, and I think this is true of most people, but like once you really get there, you start to view it as the most possible risk off thing you could own. And you know, the the reality is that most people in traditional finance and most normal people haven't done that level of work. So they lump it in with tech stocks, the NASDAQ. And you know, for the past, probably two to two to four years, there have been short term correlations with the NASDAQ and it it's sort of trades as such. I think we're starting to see little blips of that that changing. And, and part of that in my mind is literally due to what you referenced around like the President of the United States calling it a strategic asset, various corporates adopting it as a store of value, not as a emergent tech play like that. That's not why they're buying Bitcoin. They're buying it to store value into the future and propagate that forward with, you know, various risks mitigated relative to other assets they could do that with. So I do think we're we're sort of obviously still in the early stages, but I'm seeing small little signs of people starting to to perceive Bitcoin for its true nature, its true underlying monetary properties that make it risk off in my mind. Would you agree with that? And and what do you think the next potential catalysts are to continue that sort of transformation in the perception of what Bitcoin really is? Yeah. So I, I think that the, the correlations are, as you pointed out, they change so much over time. So if we look at the Bitcoin cycles, arguably in, in the past, they've been triggered by the halvings. So, you know, you, you cut the supply coming onto the market in half and then it, it just causes a bull market and that's unrelated to anything happening outside of Bitcoin. It's this endogenous shock. And now we could argue that because more than 90% of the Bitcoin supply is already mined, that the halvings are going to have a smaller and smaller effect. Maybe the previous one just, you know, had a de minimis effect compared to the exogenous shock of President Trump getting elected and the the ETFs getting approved. And that those were really the catalyst for going from 20 grand to 100 grand, right, Right. So then going forward, what other catalysts will there be, you know, beyond just incremental adoption? I, I, I, I don't know, I think we'll be surprised just by the nature of that one macro argument would be that the other big variable is U.S. dollar monetary policy and fiscal policy for that matter. And so if US monetary policy loosens from where it currently is, that that would be a huge tailwind for Bitcoin and for other risk on assets. But as you pointed out that, you know, and this is something that BlackRock themselves also pointed out was Bitcoin is not neatly in either bucket of risk on or risk off. And so, but I do think that it could enter a period of correlation with risk on if you're loosening monetary policy and vice versa, right? So if we have a financial crisis and hopefully that doesn't materialize, but if that were to happen, like we saw March 12th of 2020 with the COVID crisis, like everything gets whacked. And so that's because Bitcoin, it's an asset that, you know, if you're trying to meet a margin call on your portfolio, you just have to sell anything and everything. And so you'd see a sell off in Bitcoin in a crisis moment. But that in response to that crisis, what would happen? What would happen is that we would need to print lots more dollars. And so then you go back into, OK, who benefits disproportionately? I think Bitcoin benefits more than NVIDIA in that scenario of a monetary loosening. And so that's where you know, the, the correlation it, it can still be directionally the same. But in terms of magnitude, I think Bitcoin will will outperform. Agreed. The one one thing that I would maybe take the other side of is the having having less of an effect moving forward because I would argue that I expect bitcoins market cap to more than double each having somewhat offsetting at least the dollar amount of Bitcoin supply issuance moving forward. But. Yeah, it might take. It's you know, it it was nice that so I would argue that it was nice that in the past that having's caused a, you know, parabolic bull market, but the not so nice part was then the bear market, which actually kind of prevented adoption, right. Nobody wants to buy into something that's going down. So a large part of from a factor perspective, Bitcoin's very strong on momentum to the upside and the downside. If if we have less of a having impact and the Bitcoin can kind of drift upwards and have, you know, a run up and then go sideways and then another run up and go sideways over a much longer time period. Then that I think has its advantages as well, right? Rather than the manic and panic. Yeah. Now that that's a great point because there's obviously just a, you know, what I would call like a fear factor of people who again, don't fully understand what they're looking at, but they see it so volatile. They also probably don't understand that, you know, bitcoins volatility is unique relative to other assets and that it's positively skewed, whereas most other assets have a negative skew in terms of their volatility. But that's, you know, that's in the weeds and most people looking at it just see it going down 7080% and they're like, no way. So I agree with you. Like there's, there's actually there could be benefits to, you know, volatility sort of dampening over time and a a slower grind upward would just be less scary for folks and and maybe incentivize them to, to learn about it faster than they otherwise would. So yeah, I think that's, that's a great point. I wanted to pull up on the screen here. Just hash rate just ripping. I guess it it just a little bit recently, but you know, giving your expertise in the the mining space of the Bitcoin world. I'm curious what your thoughts are on just what we've seen in terms of hash rate really since, you know, this this dip in in 21, the China mining ban. Ever since then, it's kind of just been, you know, up into the right and you know, is this is this nation states getting into the game in in your view. You know, I, I think there's long been rumors of that being the case, but you know, any, any thoughts in general on, on the mining space and, and hash rate? Yeah. So 11 factor is just the generational change in ASICS. And so as ASICS become more efficient, you can hold out, hold everything else constant hash rate increases. The other is that Bitcoin mining is the most competitive industry in the world, right? It's entirely permissionless and all you need is access to electricity. And there's a thriving secondary market of ASIC mining rigs and lots of service providers, you know, finding lots of nooks and crannies to hook into, to be mining economics that you know can be almost like free electricity, right? If you've got a hydro dam that is underutilized that you're able to hook into or flared natural gas that nobody else is using that you got free fuel there. So that's, that's for one. The, the other part of it too, is that the, the, the, the global competition of it makes it such that, you know, if, if, if Russia, for example, and I, I'm no fan of Russia, obviously, I, I, I, I, I'll start with that. But that because they have been cut off from a lot of the international financial system, one of their incentives is to access hard currency like Bitcoin by monetizing their energy assets. And so you know that there's there's that part. And then here in the US, that Bitcoin mining company is being publicly traded. They've had access to a lot of capital and have been able to put that to use in turning on mining rigs. And so right now, if you look at the mining economics on a dollars per MW perspective is cutthroat. And so that, I think reflects the fact that it's just this global commodity that there's so much competition in. And now we're seeing a lot of Bitcoin mining companies start to look at, OK, how do we redeploy capacity towards AI and HPC that can have higher margins than Bitcoin mining itself at this point in time? Yeah, that's fascinating. Maybe I wanted to one, just give you a kudos for the new podcast that you started, which I think is fantastic. It's you want to talk a little bit about that sort of just back on the the angle of of why education is so important and what you guys are trying to do with the new pod. Yeah, absolutely. So Michael Goldstein and I, we met in college. He started a Austrian economics reading circle, the Meses Circle. And I was attracted to it because I had gotten into Austrian economics through the Meses Institute, which is a an academic think tank essentially of, of researchers in Austrian economics based in Auburn, AL that had been publishing on the Internet. And when I was in high school, I was downloading MP Threes onto my iPod to just kind of give you an idea into how early I was into the podcast game. So the when we were learning about Bitcoin, the information was in lots of different places. And so we wanted to and, and Michael especially, you know, he's he's the, I would, I would really say he's the founder. He's the president of the Meses Institute or sorry, of the Nakamoto Institute. Yeah, Sushi Nakamoto Institute to pay it forward and to get all these resources into one place, translate them into lots of different languages and to help drive forward Bitcoin adoption. Because ultimately, yes, Bitcoin is software, it's code, but it's also, I think, an ideology and ethos around it, a culture that is, you know, if we want people to understand what bitcoins value proposition is and why we shouldn't, you know, go and change Bitcoin or start another cryptocurrency and all of all of these big questions kind of be be putting out thought leadership on that. And so the Nakamoto institute has been, I think, the the the best Ave. for looking at even pre Bitcoin thought. You know, there's lots of cypherpunk writings that Satoshi Nakamoto drew from all of Satoshi's writings. And then kind of the post Bitcoin thought of, OK, Bitcoin exists. Let's try to wrap our heads around it and try to explain it in different ways that might be, you know, relatable to folks and so and, and be timeless, right? So it's not like it's not about current events. It's really about trying to figure out what are the timeless aspects of Bitcoin with, with the benefit of hindsight. We wanted to go and look at what what had been written 10 years ago and take a fresh look at it. And so that's what we've been doing on the podcast, the reorg, which is a technical term from from Bitcoin that Michael and I have been recording. I think when we got 10 episodes now under our belt, we recorded two more today. There you go. You know, just to, to keep, keep it fresh and also to, to, to for people who are not around 10 years ago to resurface these articles and to look at it with our, our, our 2025 eyes. Yeah, I've I've been listening to all of them and they're great. I would highly recommend to anybody. Throw it in the show notes. It's. Fantastic. Stuff. Please, please check it out and there are a lot of great writings in there too. And really appreciate your perspective on, you know, old ideas with a little bit of a fresh look too. And many of them are very timeless as you mentioned. So if you have a question or thought or concern, it's probably answered within the the reorg or somewhere on the website. Yeah, well, thank you, Liam. And, you know, we're standing on the shoulders of giants because obviously if, if I were to say, like everything on the Nakamoto Institute was already discussed in the Bitcoin talk forums in 2011, right? There's, there's a lot of history there. So yeah, it's, it's been a lot of fun to to to put together those resources. Yeah, it it's truly fantastic. And Pierre, I will say I'm jealous that you started learning about Austrian economics in high school. My high school teachers and even my college professors, I, you know, I mean, majors in economics didn't learn 1 lick about Austrian economics. So that, that tells you everything you need to know about, you know, the institutionalization of, of Keynesianism over the years. Maybe one, one question because we're, we're coming up on time and want to be respectful of your time, but maybe just sort of going forward, what can people expect in terms of, you know, quasi road map, if you will, for the Bitcoin bond company and where can people learn more about it? Yeah, so, you know, it's it's a ton of work behind the scenes and just follow me at Bitcoin Pierre on X as I have updates. That's where they will go. But yeah, this is not, you know, it's not a a retail facing product. And so in many ways, it's just meet me out here in the trenches and I, I hope to have more over the coming, let's say, years. Awesome. Well, thank you very much for for joining us. This is a a great conversation and and always appreciate your insights and and thoughts, Pierre. So thanks again for joining us. Yeah. Thanks, Brian. Thanks, Liam. Thanks, Pierre. All right, take care, Royce. 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 On Ramp 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 on rampbitcoin.com/contact to schedule a consultation with one of our private Client advisors.
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