The U.S. Shutdown, Stimmies & Bitcoin’s Next Move

It all comes down to computers communicating. The information superhighway can be a confusing mix of on ramps and off ramps. Bitcoin is worthless artificial gold. Is it still rat poison? Probably rat poison squared. We need to get into the. World of OK, this is actually foundational. Technology. What the Internet of Money does is it creates a single network which can do a microtransaction to a giga transaction. The Internet is going to be one of the major forces for reducing the role of gun. The one thing that's missing that that will soon be developed is a reliable E cash. Hey guys, welcome back to another episode of Final Settlement. This was an exciting and action-packed episode. No shortage of M&A deals and new products and releases in the ecosystem. Quick word from on Ramp, an on ramp business specifically, I'm not sure we've had a chance to share it here. We launched this a few weeks ago, incredibly excited about the product. We announced a case study with a large firm, but also really foundational infrastructure needed for businesses across the landscape that are adopting Bitcoin as a treasury reserve asset. Not only is multi institution a superior way to custody underline than trusting a single custodian, but then naturally what's existed or what hasn't existed in the digital asset Bitcoin world is governance access based controls and everything that generally exists in the traditional financial system has not been ported over when it comes to just treasury management of the underlying Bitcoin. And so with honor and business institutions, enterprises get access to multiple users. They get access to creating quorum of quorum so they can decide on who has access to check off or approve a transaction before the withdrawal takes place. And then you get complete audit controls as well as multiple wallets, different quorums, everything that a large scale institution would need. I'm really excited about this announcement. We're starting to onboard publicly traded companies as well as other large institutions. If you want to learn more, I'd encourage you to book a consultation or reach out. All right, on to the episode. I hope you guys enjoy. Welcome back to another episode of Final Settlement. Today is November 10th, 10 O 8:00 AM Eastern Standard Time. Gentlemen, how are we doing? As always, I'm joined by Michael Tanguma and Liam Nelson. Big list today. Got a big list, lots of deals to get to. But maybe before we get to that, the biggest news, the government is still shut down, but we may, we may be nearing an end to this. I think we're at like 40 days now. But late last night, senators advanced a tentative deal to end the shutdown negotiated by a group of Democrats and GOP leaders, which would fund the government. This is the funniest part to me, Which would fund the government through January 30th. So even if this passes, still needs to clear the House, which likely could take a few more days here. Even if this passes, this is going to get, you know, a spending agreement in place until the end of January. So a, a few months. Any thoughts on any of this? We'll get to to some other news here as well. But you know, flights are getting canceled, there's delays at LaGuardia that I've been hearing anecdotes about. Seems not great. I have a flight later this week so I'm hoping to get this cleared up within the next few days. But I'm I'm not not too optimistic about that. Yeah. I mean, I think it won't be until retrospect will understand what's going on here and never, you know, take things especially with the government at face value. Like there seems to be something else going on outside of just this direct misalignment. I think the most interesting part, I guess for me as it relates to this show is that the market seemed to be like stalled out across the board with the uncertainty of how long does this last? What's going on discussions if or if not around these different accounts and has liquidity dried out because they're not the money's not flowing as it generally would be. And so either way, yesterday with Trump's tweets, some other rumors, markets kind of took a turn. Specifically Bitcoin was, you know, teetering around 99,000. I think's today sitting around one O 6. So it it makes sense. I don't I I think the big thing, and again, this is just very left barbell is Thanksgiving's coming up and it's going to be an absolute mess if they don't figure out that people can get home or get back to their families for Thanksgiving. A couple with Trump in the midterms and sending out the STEMI checks. I don't think they want to piss off American citizens, so I would imagine this gets fixed sooner than later. Yeah, a nice bit of reverberations, but along the economy too. I think a lot of these earnings calls in in Q3 really calling out the weakness of the core consumer all across retail and restaurants. A lot of that is due to the lack of, you know, EBT and and all that jazz. So sounds like we're gearing up for potentially another round of stimmies or additional, you know, easing in order to allow these businesses to really, you know, operate at A at a full capacity. But there's a number of different other, other bailouts and other, you know, 2nd order effects to the we'll, we'll go into in a bit real quick. What do you guys understand if not it's OK. But like the EBT and the the snap stuff like what? What has stopped and what is going to stop? I I see it on the cursory and then I see again. I don't know how much to trust on Twitter where Walmart claims and other places are just empty when they traditionally would it be. And I again, I don't believe everything but like where has the flow of capital stopped from? I guess lower income earners when it comes to benefits around like SNAP and the things without, you'd buy day-to-day goods, if at all. Yeah. My understanding is that every two weeks or so, the benefits are reloaded onto these cards and they just haven't been. There's there's a lot of uncertainty that I don't necessarily understand the going back and forth that the Supreme Court. So I can't say I'm, I'm fully up to date on everything, but my understanding is that it's kind of running out for a lot of these folks. It just hasn't been replenished since the government's been shut down. Got it, Got it. Yeah, and, and we alluded to this, but the other sort of announcement from the government was a proposed $2000 tariff dividend, which may be referring to a decrease in taxes. But there hasn't been any sort of more details about this. I think Trump initially tweeted out something to the effect of $20,000 stimi checks and that's how everyone interpreted it. And I think Ben Besson got on TV and said this may not just be a check directly to citizens and it's more of a, you know, a decrease in the amount of taxes they're paying, which would have a, a marginally different impact, I think than people were picking it up last week. As you know, similar to these stimmy checks from 4-5 years ago, which sort of naturally flowed into risk assets, whether it was crypto, stock market or just gambling in general. But so I think there was a, a natural perception that we are headed for round two of that, but it may look a little bit different. And then on, on the, on the general shutdown stuff, I mean, it's all theater at the end of the day. Like they're arguing over whether to spend, you know, I don't know the exact numbers, but 2 trillion or one trillion. Like it, it's, you know, there is no stopping the train of debt and, and deficit spending. It's just, you know, an argument about how much to spend in a given time frame. So, you know, it's, it's largely noise and, and worth tracking as you know, it's obviously having ramifications and ripple effects on all parts of the economy and people's travel. But you know, at the end of the day, this is all theater. They're going to spend more. They're going to continue to debase the currency. So that's just something to keep in mind as you continue to track these headlines. But maybe we should move to some deals unless you guys had other areas you wanted to go. I was going to pull up the Ledger IPO news. Liam, I think he brought. This yeah, this is, it seems what we've seen a ton of different news on, you know, different digital asset companies looking to go public and there is a lot of reason for demand for this type of company to go public right now. But I'm really interested to see what the disclosures actually look like. We saw there, there are a lot of concerns over, you know, Ledger lies and what the actual software that they're running and, and how much they actually track the consumers, what the types of vulnerabilities are that are going to be disclosed as potential risks to the company. And we've seen just over there's essentially been a bear market and, you know, retail adoption that we've seen this cycle. But Ledger does have the OTC product that allows them to, you know, trade both buying and selling directly to their hardware wallets. And so I, I would imagine that one's actually doing fairly well. And then in addition, they have a fairly decent B to B to C type product that all the OR not all of these, but you know, a lot of the exchanges will, will use hardware devices like the Ledger's we saw with the buy bit hack earlier this year. So I'm, I'm really interested to see what this all looks like. I I would imagine that the hardware device market kind of stalls out as you've seen, not quite as much interest of you know, early adopters slash hobbyists that will want additional to hold all their wealth or a substantial portion of it on hardware devices. But it's so it seems like a very astute time to to go public, especially with the market where it is. But think it's just interesting to watch. Curious what what you guys thought too? Yeah, I think there's a lot happening here. I think, I think we were talking about the shutdown and and handouts and EBT or whatever. There's just a fundamental understanding that we have to always recognize whether we talked about that and what what the second or third order effects of sending out stimulus or similarly here that there's a brand here, there's longevity, there's a IPO market that is short digital asset firms and they sell hardware devices and is it going to be worth X valuation now? So I think that's just worth, you know, thinking about from the underlying fundamentals of of dislocation of value. Now with that said, the interesting aspect is where I see the value in this business and it's very interesting is the amount of capital that they have arm's length reach away depending on how you know their security profile when it comes to I want to say it's what are the numbers here? I don't I don't know it's over 100 billion. I think that the IT might be in the orders if crypto's market cap yes, so 100 billion worth of Bitcoin crypto market cap call it 3.5 trillion, maybe 4.5. They sit at a crazy enough Ledger sits at about anywhere between 750 to $1.25 trillion that flows within that application hardware signing devices in a potentially Ledger enterprise. And the net net of that is that you have a relationship with that client, you have a relationship with how those assets will be used. So whether it's buy, sell, move independent of the future state of net new Bitcoin holders buying 10 to 100 Bitcoin, they're not, you know, generally our stances they're not going to put with 10 Bitcoin was, you know, a couple years ago, $10,000 a coin, it's 100K. It's fundamentally different than 10 Bitcoin being $1,000,000 and somebody net new putting 12 words in a see phrase. And there's also the viability of do harbor devices make sense in this respect because like the notion of a cold card is fundamentally air gapped, segregated from any digital device versus what Ledger and Ledger Live is effectively just, it feels like a glorified mobile wallet, right? It's a hardware phone with a hardware secure module and and it's closed source and it's effectively connected to the Internet the second you ever plug it in, which you need to to use it. And so it's like how if crypto and digital assets are going to become more and more mature, like how much does that make sense versus just having it on a phone? Like why would you want two different devices? And so the viability of that business is just interesting. But the thing though, I think just keep in mind when it comes to the valuation that business in the interest is if you're sitting between 1 trillion or directional 1 trillion of crypto assets and the end user in your Fintech or bank, that is fundamentally a very interesting proposition. And so then what does that look like? That's the biggest thing that I take from it. Yeah, that's, that's all very salient points in in the sense of it's an interesting time for this business to be going public and you know, sort of rightfully so like they see the green light from the administration. There's a lot of other sort of crypto native firms that are looking to go public. So the timing feels right from that perspective just in terms of the amount of sort of demand that doesn't have exposure to the asset class that wants to invest in sort of the plumbing areas of custody, wallet infrastructure, etcetera. But at the same time, you have, you know, effectively this form of custody is not really invoked. Like to your point, Michael, like the the net new people are likely not buying 10 Bitcoin and putting it on a Ledger device. That's probably not how they're entering the space. They're either, you know, buying the ETF or going to Coinbase institutional something to that effect. And so it's it's very interesting timing just in the sense of this has been the way to secure assets, particularly Bitcoin for the 1st 16 years of its history. You wanted to get it off exchange and and do some form of self custody. So that sort of was the path. But I think we're seeing that this is changing in real time. And even in this this write up, they reference, you know, wrench attacks on the rise, physical assault and individuals. The Ledger Co founder himself was kidnapped in January of this year and, you know, demanded a €10 million ransom and and cut off one of his fingers. Like so this stuff, you know, the attack surface, the just the general knowledge, like public knowledge, criminal networks, sort of becoming aware that, you know, millions of dollars are held on people's, you know, devices in their homes or on their person. So it's just a very interesting time for this business to be going public when they've they've served a real need historically, But I think that that need is in flux. Like how is how is Bitcoin and other crypto assets going to be custody in the future? I think it looks a little different than what they've built their business on. Yeah, I think I didn't go anywhere near there simply because I think we're so early and the main reason is as the transition slide is to Ripple getting a $500 million investment like this has always tied into the whole thing like where we sit and where made feel a little different from investing to what we talked about. It's just going to be there's a long road here. A lot of capital be destroyed. And it came out last week, I think right after this podcast, Fintech Ripple gets $40 billion valuation after 500 million in funding. And yeah, I mean, there's, there's a lot here. I think the closest or the most relevant is in the world where you dislocate value from the underlying capital structure and the cost of capital is is 0. You get weird things and and crypto is a weird thing as a by product of it, because everyone can make different stories and narratives trying to make the next thing in in the world has become. You can imagine if there was a lot less money floating around and Bitcoin emerge, you know, it's kind of AI still think Bitcoin would be successful because it's a harder form of money than gold. It would just maybe take longer. Maybe it takes quicker there. It's an interesting path to discuss because you have less the the take would be that you'd have maybe less crypto currencies because you have less speculation. You have less capital to fund them because when you look at these numbers from Bitcoin, you know, startups or companies relative to crypto, the numbers are insane. It's like 100 to 1000 X and this is an example. But what's fascinating about this and this we're kind of like backed into it is in a in a world like this, you can actually launch a token, you can get government regulatory capture. You can ultimately, you know, politic and lobby into an administration that you know, this is obviously a bull market for this space and and favorable regulation and legislation that now you can start making acquisitions. They bought. What was it? Hidden Rd. Yeah, Hidden Rd. from the prime brokerage side, which is an actual business then they just recently bought a wallet provider. And so the main point and they've done other things that they have now their own stable coin that they now have big players like Citadel, Pantera, Galaxy, Bremen, Howard. And I would suspect though, that this isn't a pure equity play in the sense that there are some like warrants or access to the Ripple token, because those things are highly liquid. Like if you got basically downside protection of the equity in the upside of some like warrants on the token. And you can look at the numbers like, you know, Galaxy sees this. If you can make the case that your token is a proxy for retail interest in your company, and that will be the value going up as this business grows, you're going to be able to again, downside protect the equity upside with the token. So it's just just a byproduct of an irrational world because Ripple has and and never will have a fundamental value of the use case of the underlying and on a long in a time arising that will translate to the businesses that they acquire because that's all that's how we work. When people give inflated equity premiums and people go use them for acquisitions. If you don't have the underlying valuable, it's very hard to go duct tape a bunch of businesses together that actually produce economic value. Like that's a Fiat story that's told and it ultimately doesn't work out. And it sucks because the hidden roads of the world and people that build really big or nice businesses and put their blood, sweat and tears, they get told a story about the equity value of these companies. And I saw this first hand. Like if you look at the number of businesses we were bought, it was like 15 businesses and they all basically got left holding the bag and like nothing. Yeah, that's a great point on the warrants as well. I didn't even think about that. But when you think of the Citadel in in Galaxy, just having like the knowledge on when Ripple will and and will not be sellers of XRP in order to kind of not not manipulate like almost like essentially create a market around when the token will and will be more valuable is just going to allow them to capture additional trading revenue and you know, spreads on on their view of the token as well. So it definitely makes sense from that point of view. And is is is definitely very Fiat. Yeah. I mean this is this is a. An interesting time because people are coming into the market for the first time and they don't necessarily know what is actually going to be sustainable long term businesses. And so you can tell stories of, you know, we have XY and Z and we're now pivoting, right? And so going back to Ledger 2, like they can talk all about like how they're going to be, you know, into and leaders in the stable coin market too. And you know, custody digital assets and stable coins for cross-border payments and have better security systems for that. And then I'm sure Ripple is telling a whole different number of stories on how they're going to be the leader of digital assets as a whole. And these not new folks are going to, you know, they just haven't been around for as long just naturally because the markets growing and, and getting bigger. And so it's there times going to be a flat circle with this. I, I unfortunately, and I'm on the, you know, the Bitcoin market cap. Well, essentially our Bitcoin dominance will go up over the long term, but I think every four years it's going to have this little jump until as more people get into the space and they're going. To be able to tell a number of different stories, it just really shows how early we are. Yeah, it's pretty remarkable just to think about Ripple, XRP and sort of like the the shape shifting that they've done over the years to at least remain like relevant in the zeitgeist of like what crypto is like people know about Ripple, people know about XRP for whatever reason. And I think a lot of that is, you know, marketing campaigns over the year, but also then positioning themselves from a lobbying perspective with this administration, like I think they were early and often in terms of of those efforts sort of on the broader crypto side. And this is reflective of that. So like the perception of Ripple as a business, as a, you know, player, quote, UN quote in the crypto industry has sort of, you know, metastasized over the years and without any real regard for like what they do or like what products and services they may be interested in offering. Like, you know, it was effectively just a, you know, token spin out of spin up out of thin air and allowed the the founders to benefit from, you know, monetizing those tokens for years. And and now they're thinking, OK, we're going, we're going to now do something with all this money. We're going to acquire businesses, become a crypto conglomerate of of sorts. And it's storytelling. It's all narrative and storytelling at the end of the day. But the reality is most people don't know the origins story of Ripple and you know, some of the, I guess intertangled or or perverse incentives with the founding of that business and then now where it sits today, most people don't have that full history. Just two things to add there. I think this is the big paradox of the amount of capital we talked about a little bit with Alex Thorne. It was actually really good. There's a few few threads to pull on. It's a good podcast. I didn't I've seen it floating around, but the cheeky pie upon cheeky Pint podcast with the founder and see I think it's ACEO from Stripe with Bridge and Privy. That was really interesting. Just discussing the amount of capital being thrown out in the different use cases. I never really they've identified a few and that are very valuable. But then with Alex, we're talking about like how everyone is just they know they need to throw money at stable coins in in the movement of capital, but they don't they know there'll be disruption. They just don't know where. And so so that's one thing happening. The other one is because the amount of capital that exists in the system in this, there's the stories that are told. This is fundamentally where it comes from where you have to, this is like I, I believe it to be objectively true, being that it sounds objective is you have to fundamentally have built a business or know how to build businesses to allocate capital. And the reason why is because it's a very Fiat thing for somebody to tell people a story. And then you just believe it because everyone in a, in a, in the world we live in today is great storytellers. And so generally when you've built something, you kind of can walk through the idea of maze because it's a constant of iteration. If you're going to build something successful, you have to ultimately, you know, go down multiple paths. The the joke from Bezos is that, you know, oh, we look so successful. We've been successful all these things. You should see how many times we failed, right? Because it's all about going down IDMAS. You can go down multiple times, go the wrong way, reverse back. So the point being is these institutions don't have any lens. They've never built any, any of these things. Most of these firms they're investing or allocating specifically from Tranfi. So when you have Ripple and other firms, they're able to go out to the market and tell these stories and two things happen. One of them is if you have big balance sheet, large bags of XRP, regulatory capture lobbyist, then you can make huge headway into the optics of your business to get Citadel to come across and listen and bind your story when they have no experience in the space. And this is very similar to DATS. This is why I've always felt confident calling him out because there's so much money to be thrown around that people just assume it's very similar to Citadel to, well, how does Citadel get into this deal in the same way like Kyle Bass got into blockchain.com? It's like these guys are very smart, but you take these mental models of the right signal, the right people, the right heuristics to school and then you layer it into an industry that you know something's happening, you just don't know where it is. And that's how you get these like Frankenstein type deals in the same way you get Frankenstein type structures with these closed end funds that so people keep believing that they're going to trade at a premium. And I think it's just important to recognize that because when you look at the market and then you have that lens, then you can start to back into, well, does this deliver fundamental value? Would I personally give money up for XY or Z? Will this general get either distribution or there's some kind of technology around the capital movement of money? And then you start to like look at it. And The thing is in that ecosystem, nobody really knows how it's going to work. And Stripes probably at the highest level of that. And you see Visa doing their acquisition of, of a 0 hash and you start to back into like, if these guys don't know how to do it, then like, like, is there a chance that Ripple's going to win any of this? And he started like, OK, well, there's no, and it's like, well, where's that equity premium? And then if you're a crypto investor, like, well, then if any of that made sense. So this guy just said, then maybe I don't want XRP. And then you kind of just realize, well, there's no value of any of this. And maybe I can just go back to like Bitcoin or, you know, whatever. Yeah, but people aren't going to do that. They're going to. They're going to keep betting on things called FOMO. So what is it? What is this one benchmark made a rare crypto bet on trading app FOMO 17,000,000 Series A. Yeah, this is fantastic because it maybe ties into the news from today. Yeah. I mean, it's just it's eerily similar to what happened in 21. If you guys remember back in the day, Sequoia invested in FTX like Sight Unseen, they said like Sam was playing World of Warcraft or whatever, like somebody like that plays and with his patches or whatever wasn't paying attention to them. And they they took it as like endearing that like this guy's like such as Yvonne, he doesn't have to pay attention to us. That was the story anyway. Benchmark world class firm highly regarded. You Mount Rushmore of Silicon Valley allure from a venture capital perspective. They invested in this firm called FOMO and FOMO just is the, the pitch is like a you can download a wallet, you can just pay with Apple Pay. So they reduce all the friction on how you can like lose your money and then they, they give you access to like every token and everything under the sun. Like you basically can get access to almost everything when it kind of, you know, Bayes B&B, whatever. And I just thought it was so fascinating that benchmark stepping in, you know, 17,000,000 and they said they're generating a crazy amount of revenue and whatever. I would imagine there's probably some one large market maker or partner they have from a distribution perspective. But anyway, I thought this was was fascinating. Just so, yeah, a little on the nose, invest in a company called FOMO, which seemingly, I mean, you know, turning on Apple Pay, I guess that's some form of innovation. Like it just seems like there's a lot of a lot of avenues for people to be degens. Like there's there's just, you know, added to a list of platforms that people can lose their money on. So I don't see necessarily why this is like so innovative you turn on Apple Pay and that that demands a seed around from benchmark I suppose. Well, it goes back to, I don't know if you guys saw the news of Columbia doing a report on Polly Market too, but it's like 40% of their volumes are actually just like fake wash trading. And so I'm sure that FOMO has some sort of partner like that that's just like creating artificial value. And you know, you see tokens going up or down and you think that you can become a a day trader that makes millions of dollars overnight. And but life just doesn't necessarily work that way. I mean, like there are going to be some people that get lottery tickets out there, but most of them just end up broke. And so, you know, we're, we're seeing more of this just high velocity trash economy. That's just, you know, essentially betting on sports gambling and, and, you know, betting on everything more and more over time. Yeah, another deal on the list. Arcs Research raises 6.1 million seed round to launch burner terminal, stablecoin and Fiat point of sale device. I don't think you brought this one. Yeah, I thought this is actually pretty interesting. It was led by Castle Island and if you click on their if you click on the link to their website, I think there was two big takeaways from it. One was the use case is really fascinating around just being this like intermediate layer between payments and the end user and where they use. The use case was mainly on like merchant adoption because I think like, you know, if you guys have ever seen, and I don't know who pioneered this, but I think Toast is one of the bigger players where when you go to a restaurant and you take the POS directly to, to the, to the table, there's a level of turn and friction that's reduced from like a restaurant perspective around like the time you have to drop it off to back to getting it. Like there's a lot of value being delivered there and reduction of friction. And I thought it was interesting to see a like stablecoin company bring something like that to market to try to like sit between the layers. So I thought that was interesting because that's interesting for Bitcoin and, and stable coins. But then when you go to this website, it's, it's nice. Like there's a nice aesthetic when it comes to how would you be able to interact with, because I think part of it is like the thing that's coming more and more to fruition is these cards that will be loaded with stable coins. I'll have your balance and be able to to spend with them. Maybe you're getting paid, maybe you're accessing your dollars. I've always thought that's interesting. If you can auto convert, if you're spending, you know, until like from multi institution or whatever and auto converts to dollars and you can spend, you know, across the place. You don't have to sell your Bitcoin. But the idea was that like that's the real big thing missing in the Bitcoin space is a the just like design Silicon Valley bridge between just deeply understanding that side of the market. But then what we talk about, what I'm really looking for is like Bitcoin and stable coin sitting next to each other. I think that focus is just an incredible amount of value to be delivered to the market. And I thought this firm was interesting because they're not there, but they have a lot of that like direction. And I've always thought like the crypto space is a good like, you know, like beta test or like test net for the different products and services that can exist in a Bitcoin world. They just kind of had the first lens because it's a lot easier for tradfire fintech people that to come into crypto, which by the way, was fascinating with the cheeky pint podcast, because those are three of you cannot. It's like the old tweet or whatever. It's like if you're so smart, well, why are like, why aren't you rich? Or if you're so smart, like why don't you know like like true sign of being smart is like if you can do whatever you want or something like that. It's like the point of these three guys are all like basically 100 million billionaires. Like they've and they've delivered some like relative value, meaning the previous CEO, bridge CEO and then CEO of Stripe. And it was fascinating because they were talking about global flows and payments and understanding different regulatory regimes and the value of cross-border. And it's something I think Nick Carter pioneer, but it's the notion of like stable coins are like start link for money, which I think is a fascinating like mental model. But point being is they all understand all that and they don't get bitcoins. And so it's kind of like a very interesting conundrum or, or situation to be like that educated and smarter on the capital flows and like where things go, but also not recognizing there's just this other thing. It can have other layers. You don't need a barter with these different tokens. And it's just a, it's a crazy gap because all of their mental models rely on like this like interoperability and different chains and all that stuff. It's like that doesn't sound very efficient. It's not how this will play out if it's going to work. So. Yeah, no, it's, and it's a very interesting juxtaposition against, you know, a company like Square, which today, you know, this has been forecasted for a while, but they've turned on Bitcoin payments at all their merchants using their point of sale. And it's, you know, this is something that I think from the very early days of Jack and Block and Square and, and sort of his focus and reverence for Bitcoin, everyone was excited for this, this type of, you know, potential merchant adoption, right? But I think this speaks to exactly what you were just discussing, Michael, on that. Like the natural rub is like, you know, the, the reality is most people want to spend their dollars today and they don't probably don't want to spend their Bitcoin. And so while this is an exciting development and great to see, I do think it's just noteworthy that the reality today, you know, Bitcoin is, is a store value for most people and they're not intent on spending their Bitcoin. And really the people that are, are a very small cohort that operate their entire lives in Bitcoin. And so, you know, they're spending Bitcoin almost out of out of necessity as opposed to desire. And so I think we're in this interesting period. And, and it's hard to say how long it's going to be, you know, 5 to 20 years where U.S. dollar system is still the, you know, the reserve system. People want to spend and, and use dollars. That's what's primarily accepted. You know, I think what, what could be interesting from, you know, the Square perspective more specifically is like, you know, I think part of this announcement was there's no fees for the merchants in terms of accepting Bitcoin payments, no fees until 2027. So I think interesting incentives like that are going to be important for the actual adoption and usage of these things. So, you know, another area that we've talked about before is like incentivizing people to pay in Bitcoin may actually require a discount in Bitcoin terms. And so I think that'll that'll probably be the next step of this in terms of how you actually incentivize people to use Bitcoin. But I think the reality on the ground is like, yeah, most people still just want to use dollars to spend. And and they may want to start saving in Bitcoin, but you know, they're going to want access to to dollars or, or stable coins in some format that, as we've talked about, like ideally sits right by your Bitcoin and is very easily, you know, that that friction continues to be reduced in terms of saving a Bitcoin and spending dollars. But any thoughts on On the Square news guys? Yeah. I mean, this is it's pretty big just on having the coin more and more into the zeitgeist, you know, normalizing it in everyday life. But to your point, yeah, I think that most of the adoption of Bitcoin from these types of merchants will be the auto conversion of dollars to Bitcoin, some percentage of their revenue on a monthly or daily basis. And so over time, more and more businesses will just want to have Bitcoin and then thus, you know, you're going to be able to, you know, they're going to want a discount because they want to get paid in Bitcoin rather than, you know, everything that we know about how credit cards are imperfect and stable coins will necessarily be next to that, just like the the one that you guys were talking about earlier with RKI, their terminal. There's, there's necessarily going to be other merchants too, who I think are going to want to convert their stable coins automatically into Bitcoin on the back end. So I think that's going to be one thing that drives adoption. And then just the fact that they can get paid instantly and do whatever they want with their money rather than getting paid net 30 is just going to be a pretty big advantage to to these merchants. But it's it's mostly just going to be through easier ways to buy Bitcoin as soon as they get paid. Yeah, I think this has always been the the big question and I, I don't think it comes at any singular answer it, but I do think with education and inflation running, I forgot where we talked about it. Maybe it was with Brahm. But there is just a real notion that you can make the case for certain individuals if you deeply understand and have the, the, the, the room holding the majority of your, your, your balance sheet in Bitcoin is kind of like becoming the prudent thing to do. When you look at where inflation is, especially with Bitcoin's volatility profile dampening that. I'm just thinking about it from the different angles of like, at what level do people just realize that the cost of goods and services are going up so dramatically that it just makes sense to hold a harder form of money in? The interesting aspect with the merchant side is they're the ones most exposed to this stuff because they're just getting absolutely crushed everyday. You see this across, I mean, people independently probably see it in their local coffee shops or restaurants. So yeah, it's just going to be a fascinating thing. And then there's all the other second, third externalities around like, well, what happens when you're holding? You know, we've talked to firms about potential investing and we look at it like Latin America, where Latin America has like a 24% interest rate. If you're just like a traditional business and what, But take that away from Latin America. Just like if you're a coffee shop and you start to hold more and more of your capital Bitcoin, and then you can take a loan against that for some operating capital or you don't have to sell, you know, 'cause generally you're having to sell if you're in Bitcoin, you mean access to dollars and you're having to pay those fees. Maybe there's taxes, maybe there's not, but there's just a you take out the, the effect of middle man of everything as it relates to like building businesses. That's another reason for the BTCUSD based on where you sit your licenses like there's a lot more you can offer to the market when your take out like having to deal with the banking rails specifically like a bank account. So I think it's just going to come at multiple angles. And then those communities are pretty small and the merchants like imagine, you know, a again, what is that the toast as one of the largest, like POS servicers, the second may get it. And it's good for them because if they're able to bypass some of the fees, their restaurants stay alive longer because that's who's paying them for their services. Like this will be a flywheel that grows, but you got to have like an installed base to be able to distribute and disseminate like what are best practices? Hey, guys, hope you're enjoying the podcast. Wanted to give a quick word from early riders. We've had no shortage of exciting announcements the past few weeks. Last week we announced an investment in Audio, a Latin American based on ramp in based in Mexico City and El Salvador. Wonderful founders multiple exits had formerly exited verifiable Bitcoin and and launched sloppy dough, which we ran into audio last week. And then also Argo, a Sprott family company incredibly excited about the intersection of gold and Bitcoin. And what does that look like for managing and protecting wealth over the next coming, you know, call it decade and beyond? We've included a no shortage of research investment memos around those company fundraising processes, just so folks understand how we think about companies, what we're looking at. If you're looking to build and are trying to get, you know, early riders involved, we'd encourage you to reach out. We'd love to speak with you as well as if you're looking to get involved with early riders, we'd love to talk with you. With no shortage of other opportunities, we're actively looking at a very exciting 2026 is upon us. And as we talked about during this episode, there's no shortage of M and A a lot of these companies, the reality is they can't really build. They're going to have to eventually buy companies to really insert best practices, best teams, best infrastructure. So we're incredibly excited what we're building. We're looking for best in class talent and folks to get involved. And so if that's you, please reach out Michael at earlywriters.com or you can reach out via the contact form. All right, guys, we'll talk to you later this week on the last trade and I hope you enjoy the rest of the episode. 100% Another crypto headline I wanted to get to this one comes from the Wall Street Journal. Coinbase launches platform for digital token token offerings Blockchain startup Monad will be the first project to sell its token on the new platform. Now this comes on the heels. A few weeks ago we talked about Coinbase buying Echo from Kobe, who's a crypto Twitter personality, but also a founder, and that was also a token launch platform. So I'm not exactly sure if this is basically a rebrand of that what they bought in Echo or if this is something totally separate. But it sounds similar in the sense that it is a you know what is meant to be a more reputable token launch platform. I guess I guess relative to at least the the pump funds of the world where anyone can go on and spin up a random meme coin. I think the the goal for this is to be as it says here, investors must be in good standing, fully registered and compliant with Coinbase to use the platform. And so this is I think meant to be a little bit more of a reputable token launch platform. But at the end of the day, it's the same sort of nihilistic speculative nature of the broader crypto space where I think Coinbase wants to own more of that Channel from A-Z in terms of new idea creation, new new tokens getting spin up. I think that they felt some competitive threats from the pump funds of the world bonked up fund these other token launch platforms, which have gotten a lot of the retail interest for, you know, for better or for worse, that's where it's gone, you know, people looking for 1000 X brand new tokens. So I think they recognize that. And I think this this is an effort to get back more towards the, you know, the earliest stage of these things. So any any thoughts on this one guys? What do you got, Liam? There's too much money in the system and Coinbase is leveraging their brand not in order to really push the push. Anything that's going to have real sustainable value in the long term, you know, all these things are competing on, you know, monetary properties. If they're launching tokens and you know, all of these tokens and projects are really pitching different tech properties. I just don't necessarily see a reason why tokens need to be associated with different protocols and block chains unless it's like kind of just storing value. And so over a long time period, this will hopefully see a little bit less value. But just given how much money is in the system like we've been talking about, there's this, this will see a lot of popularity, especially just because it's the Coinbase brand is on it and they think that inevitably somebody will want to buy it if you know, if they buy in early and they'll be able to get some additional exit liquidity. Yeah. I mean, this is fundamentally if you're listening and you believe or you treat, you think of Bitcoin as money risk adjusted, There's never been a better time to build any product or service because that's how far ahead you are on the market. When you look at something like this, like, you know, it doesn't even have to be that you give up the speculative bets and offering crypto. But just imagine having this head start with institutional Coinbase Bitcoin and having no real focus on anything outside of like Bitcoin as a speculative asset. Because if you think about it, you know, there's very few individuals of large positions that would leave a large percentage like sophisticated investors that the the people that use Coinbase at this point are institutional investors because they basically from their investment committee down the board have to use them. Like if somebody like a Michael Saylor. And then on the other side of it is like the speculative, you know, retail market that comes in for things like this, But to know that Bitcoin's going to XY and Z and it's going to have second and 3rd order effects and not to like build around that and design around that, It's just a crazy proposition. And you kind of see this as well with Fidelity, who's been, you know, world class in the space. But they recently, I believe launched the Solana. I think they launched actually, I don't know if it was purchasing or the ETPI, can't remember, but they, they recently launched something with Solana. And it's just this notion of knowing where Bitcoin sits in the market versus everything else and then treating it fundamentally different is like really where a huge gap has existed in the market. Because if it sits more akin to gold, then you not only get the right type of clientele and market that's going to store larger and larger positions, they're going to look for world class, best in class products. And if Bitcoin going from 100K to 500K to $1,000,000, well, there's a whole market that's going to be formed and you want to be a leader in that space. And there's very few people there. I think most people listen here would not consider black rocks going to be world class when it comes to Bitcoin custody. And so it's just a very interesting thing to see across the board. And I guess Brian just pulled up Fidelity announces users are allowed to send and receive Bitcoin, which is interesting because I think that ties into a lot of the stuff we talked about around multi institution. Like I fundamentally believe on a long enough time horizon, most if not all institutions will plug in and and participate in something like this because the market will demand it on. Again, long enough time horizon as more individuals have bad experiences with all their wealth being on their person, on their home, within their control, as the price goes from hundreds of thousands to millions and then institutions, custody all look relatively the same. The market will just naturally require better governance and standardization. But the the notion is it will when Fidelity or BlackRock could do this and it's like, well, they could, but they won't because it's just not baked into their DNA. But even when they do, it'll take them 10 years to build the next products we're already building. I've always said that, and this is a great example. It's like Fidelity's been in this space I think since 2013 and they just launched today, you know, out and in. And that's fundamentally the same reason what kind of constrains Square in Cash App? I was going to say this earlier and I didn't, but it kind of is relevant. I don't know if this is true, but I would imagine like knowing that like Jack being a bitcoiner, an entrepreneur, he probably eats at him that he can't move faster because of his size and meet a publicly traded company because he disrupted the incumbents with a little Square D dongle and how that moved. And you can know that, like that's where, you know, innovation comes from. It's not from the incumbents. It comes from the early adopters or early riders. And so again, it just ties into like traffic. I can't win the space. There's just so much legacy bureaucracy around what we're talking about with just allowing internal transfers. Or on the other side, you have Coinbase now they have like shareholder acumen and shareholder revenue and optics to keep on par. So even if they wanted to go in a different direction, imagine like they're giving up all this like tokenization, all this discussion that they're going to get and please slash by. So, you know, kind of like squash on both sides. Yeah. It's an interesting point around the the changes in products and services being driven by the market. And I think you're totally right that, you know, when it comes to custody, there will be a a move and an evolution towards more distributed custody where effectively a a single counterparty can't lose assets unilaterally. But I think the in kind stuff is sort of like a precursor to that, some form of foreshadowing where you'll either in the US or in the UK, like there is market demand to be able to transfer Bitcoin in kind in and out of these things. And so you're starting to see the initial signs of that changing like, you know, even just in the US on the Bitcoin spot ETF side, there was a change, you know, not not for the average holder of ETS, but but for larger entities wanting to do in kind transfers that'll be able to happen through authorized participants. But it's again, just being driven by the market demand. So I think that's very good salient point in that like a lot of this stuff will change, but it'll change because people demand it. And as people recognize that, you know, Bitcoin's just a different asset, right? We talk about this all the time that the incumbents are still viewing it similar to, you know, their stocks or their real estate or their bonds and not thinking about it from a, you know, more of a Bitcoin native perspective and thinking about not only risk mitigation from a custody perspective, but what will, what will people actually want and demand? And so I think it'll be very interesting to see how it plays out because you know, a lot of, you know, Fidelity's in kind of a unique situation because they have been building internally for many years now. And so I think that they have a leg up on, on certain other incumbents just in the sense that the other incumbents are really behind the 8 ball in terms of having to go out and acquire infrastructure effectively. And we're we're beginning to see the, the early signs of that because building it internally, you know, as evidenced by Fidelity takes five to seven years to do it in a real way. And so in this sort of hyper accelerated trash economy we're in like you've got to get your your bets on the table. You don't have five to seven years to build out internal infrastructure. So you're going to have to go out and buy it. Anything else on that? I did want to. There was a couple other headlines go. Ahead, I think, I think our call after push so we we can go on a couple minutes if we want. I think I did want to call out something interesting about, I think we'd all agree here. Like Solana fundamentally doesn't have, I guess any utility. I think the easy way to explain, you know, you go from like Bitcoin to Etherium and then Etherium, is it fast enough? They try to do too much, you go to Solana and Solana is not fast enough. So you end up at tempo and you just continue to like move down this migration of like until you just in the back of the database that's, you know, centralized, you can move fast, but was we're talking about false signals. So it came to my attention and I think this is directionally true. Maybe you can Fact Check in real time is so Solana ETF is the best performing ETF in 2025. And the way they got into that was kind of random in that there was a bunch of ETF providers, I guess like submitting their applications. And I guess with where they sit today, they have you like get it approved, you know, like a 20 day hold and you're supposed to submit to the government or the SEC. Like if you don't hear back from in 20 days to confirm before you go live, Well, the government was shut down. So they just like Ninja launched the deal during the shutdown. And that's basically how you get this Solana stake in ETP by Bitwise, I believe. I just thought it was fascinating because we could sit here and say all these things, but then you have the best performing ETF in Solana and people pay attention to that and they see that and it just adds more credibility and validity to it. But like again, it still objects objectively exists. You get like a bear market or even now when you go look at the wash trading like what? What is Solana used for? And you realize it's either speculation, gambling and so there's not fundamental uses of it. Yeah, net inflows surpassed Bitcoin in Ethereum. It's. Probably cherry picking like 2 days. Yeah, yeah, I think this is super cherry pick data, but but you're right, the the the take away for the uninitiated will be, oh, look at Solana. They're, you know, the ETFs are are successful. Maybe I need some exposure to that token. But yeah, this is cherry pick data. Like, you know, bitcoins had a a rough month, month and a half. And so, yeah, this is interesting to see. Yeah. I mean, I think it's just because so many people are not new into the space. And so rather than trying to understand what the fundamentals are and how to look at the space from a long time horizon, because they haven't been in the space for a long time and the space hasn't necessarily existed for that long of a time. They go and chase whatever the momentum is or whatever the story of the day is. And usually that's pretty much about as far out on the rest curve as they can go, especially when when bitcoins, you know, in the zeitgeist, there are usually a couple other distractions out there. And so, yeah, I mean, the only thing that I've been thinking about is just at the end of the day, everybody still sees us as crypto, right? Like there is fundamentally no distinction from people who haven't been in the market for at least one year or usually at least four between and have a material amount of their net worth in Bitcoin, between Bitcoin and the rest of crypto. And so naturally it is almost a good thing that I mean, stable coins are a good thing because as money will be even more and more digitally native, that'll naturally lend itself to the saving your money in in digital money, which is what Bitcoin is. But at the end of the day, most people will think that Bitcoin and crypto are naturally the same thing. And so over time, as more traditional finance folks come into the broader crypto space, they'll inevitably just Bitcoin will will benefit from that. But unfortunately, it's not going to be like we would all hope it is, which is people come to like the digital gold conclusion right off the bat and we'll look it for the best situation. I think that they're going to come into the crypto space and then get burned on a couple of different things and eventually find Bitcoin unless they just go from stable points to Bitcoin. But yeah, that's that's what's going to happen with a lot of these Solana ETFs, etcetera. Yeah. And I think that that's supported by this, this report, it was in Reuters, more than more than half of hedge funds invested in crypto. You know, on the surface, I would say that this is a surprisingly high number. Around half of hedge funds are trading some form of crypto. But to your point, like at no point is there a distinction between Bitcoin and broader crypto here. It's just saying, you know, funds have an average allocation of 7% to crypto. Now, I would also imagine a lot of this is, you know, basis trading, you know, it's not like long term positioning, it's trading around it. And so this is to the broader point of not only is there a conflation between Bitcoin and broader crypto, but it's the entire perception of the entire space as it's lumped together is very speculative. Like, you know, flyer positions 2 to 5%. Trading around the volatility effectively is what a lot of these more traditional participants have been doing for years, right? Like hedge funds trading around the stuff is not new to 2025. I think this has historically been a way that a lot of these more traditional fund managers get into the space is just trading around the volatility. And so that actually adds to the conflation in my mind, like the the idea that crypto is speculative and you want to just play the OR play the the volatility, you know, by trading around it. Like I think that that that adds to the completion of just, you know, this is all sort of the same risk bucket and we're going to take a flyer on it. And then that extends to like the products and services that are demanded, right? Like no one cares about the custody when you're just trading around a a 2% flyer position. Yeah, Maybe you can pull up based on that the the balancer act because I think that it all ties together around like all these applications and things all kind of start to blend and look look the same to market participants that are like not crypto native. So you think about like the BB and K Privy or 0 hash all of these like tech layers. They're effectively building houses and housing AP is to build certain wallets for crypto, whether it's Bitcoin or others, and they're generally hot wallets or some yeah, they're they're hot because you think in Privy circumstance they're building like the wallet at the end user client layer. So they're holding the private keys, but the private keys are on their phone because it's an. Application. So it's a hot wall. And if you take that lens, so it all starts to look the same. And then if you're doing this and you don't have the, the, the primitives or the understanding internally of the severity of a digital buyer asset, well, then you're naturally going to end up with random, you know, SLL moments like this where this is the other side, which is, I'll let Brian explain whatever they do. But like the, the main point is as you get defy and you get all of these like things that start to Frankenstein together, you get 2 parts, you get the crypto natives getting just blown up, you get the other just insane amount of assets lost. We saw this with a few weeks ago at the perps situation and deleveraging there, but it goes back to the point of like we talked about that this asset class like it's not trustless, it's trust minimize. It's the same thing with Bitcoin. And it doesn't matter from Bitcoin to crypto that the crypto, the digital natives as a matter of field is Bitcoin crypto. Just believe like that. We just end up in this world where we don't touch any humans and everything ends up on these other layers and there's all these arc and just crazy like the the mint, the mints that nobody knows who they are and the lava stuff that's going on. It's like, like Bitcoin is money, money requires financial services. Financial services are relationship driven and relationships are localized. So that's how this is going to play out because that's how it's played out for thousands of years. Is you generally trust the people closest to where you're at because you can recognize them, you can go into their branch. You you have some physical proximity, which breeds a level of comfortability and that's what requires for storing your money. So assume Wall Street is just going to like tokenize, digitize and just put everything up to code and then things blow up and they just say it like, yeah, I mean, I don't doubt that they'll do it. I don't doubt that also it's going to end up in misery and money is going to be lost. And so it just ties back to all these things really are focused on this like high velocity movement. And instead of really looking at like, well, what is this asset? How do I actually help my clients, educate about it, preserve it, build best in class products? And I think we're going to get closer there. I think this price goes from 100 to like 500 K. The amount of interest the presidio bitcoins a great like a Canary in the coal mine with like now something sitting directly in Silicon Valley. You get to learn, you get people burned by crypto and they naturally will come into this world and take all that knowledge and and experience in the traditional markets and bring it to bridging Bitcoin in there. But it's really this is just a testament to how early are and the joke I say is we're so early that we haven't figured out custody because outside of a very small corner of the market, people look at multi institution as a niche. But when you really like peel back the layers, you start to understand like, well, shit, if Bitcoin's really going to work based on how gold went, you kind of need decentralized governance of the underlying, but not just by like anons or code. You need natural organizations with balance sheets and regulation and assurances if. Real money, like trillions and trillions of dollars are going to come into this. Hey everybody, hope you're joining the episode. Lots of interesting dialogue going on this week around stablecoins, AI and a lot of the M&A activity that's happening in the industry. Quick word from on rampant specifically around our inheritance product. We have no shortage of net new clients and existing clients that came over to on ramp specifically because of inheritance. We've all been in this current situation where generally Bitcoin is male dominated. Our significant others are perfectly fine with us allocating or even over allocating depending who you are to the asset. But they also don't want any exposure have to deal with management of private keys, what to do if something happens to the individual harbor devices see phrases all the things that account for self custody. And so while clients sometimes feel perfectly fine with self custody for themselves, it really comes to legacy planning, whether it's with inheritance, the dynasty trust release that we had inheritance comes with every product and every multi institution account included with also insurance Iras and trade. But inheritance is the thing that I want to call out simply because as the price appreciates, as we get older, we start to recognize that we have to legacy plan, we have to be more mature with this asset and so on. Rep really provides Peace of Mind there. Even if you're not necessarily ready for something like On Room, but you want to learn more how we solve for that and some of the other, you know, financial products we offer as Bitcoin and naturally matures, it needs serious products and solutions. I'd encourage you to book time or you can reach out to me directly, Michael, at honor@bitcoin.com. We're actually piloting out some flat reduced base pricing that we're testing out this quarter and we'll go into 2026 with. If you'd like to opt into something like that, reach out and we'll share more. All right, hope you enjoy the rest of the episode. Yeah, the the sort of signal or take away from all this to me is like the notion of so, So what we have on screen is this Balancer exploit. So Balancer is AD 5 platform that is actually been around for a while. I think it was launched in maybe 2018. So it's gone through a couple cycles. And this was one of a couple sort of crypto exploits from last week. So I think in this one there was around 100 million lost and then there was a separate one called Stream Finance, which I bit I believe is a bit newer and they were doing something with a an algorithmic stable coin that went bad and that lost another 100 million across various chains that were connected to that. But what all of this speaks to to me is like, you know, what you alluded to around Bitcoin is money and you need to provide financial services and trust minimize way. Like all of this added complexity and smart contract risk of all of these D5 platforms flies directly in the face of that sort of thesis or or underlying thinking around financial infrastructure for money. Like you need to be able to preserve an into the future. Do you need to be able to take out, you know, recursive looped debt across three different block chains to get a 12% yield? Like probably not like so there's all of this added complexity, but with that comes smart contract risk. And so this is what is embedded in all of these things that proclaim to be decentralized, proclaim to be these trustless protocols and systems. But when something goes wrong, it becomes very clear that they're centralized databases. So whether it's freezing accounts that are tied to an exploiter or rolling back chain, you know, rolling back the chain in in the case of an actual theft or loss, we've been seeing this stuff for years, right? Like this is just kind of how these things operate. They move fast, break things, they get broken, they get frozen, they get rolled back. And this is not how you build trusted financial infrastructure, right? Like you want as as few assumptions as possible. And so I think the elegance, you know, just coming, coming post sort of the, the white paper anniversary, the elegance of the Bitcoin white paper, the, the elegance of the protocol, the simplicity of it. Like that's a take away of, of about all of this to me. It's like, no, we're, we're building new money, we're building infrastructure for that money. But it it should be as sort of as simple as possible, like that is the root cause of or sorry, the the root goal of Bitcoin protocol development. The reason why it's slower than all these other bot chains is because it's purposeful and in an effort to not break things and not have these types of exploits occur, which is naturally what happens when you add complexity to these these protocols. Yet there's one other thing to add, because Alex is really smart. Alex Thornton, we had him on the pod and he's probably one of the few like rationalist. I, I hate the term bitcoiner because it just, we got to, we got to move past the rationalist, right? Somebody just wants their money to be sound and not to be debased and whatever, but it sits within crypto and and Travi and he straddles that bound pretty nicely. And we were talking last week because it's something I've been thinking about when you really start to peel back the layers because it's very interesting around money movement and capital movement, you know, makes society go round and stable coins in the different bridges. And specifically when it comes to the treasury markets and assurances and orchestration. And you look at all that and then you kind of contextualize that against Bitcoin and you really just look at the simplicity and the elegance of no intermediary, no counterparty risk reduction on chain. You know, you, you got a lot of the transparency. It's outside money. And I appreciate that, Alex, really like you don't like that contrast, contrasting it. But if you take it a step further, it just makes logical sense. Whatever we're doing here is doomed to fail when I talk about crypto and and stable coins, because if you already have this system that's already highly levered, we understand the amount of inflation capital that needs to be inserted to keep it sustained the debt levels. And then that naturally brings more and more dislocation and distortion, distortion of signal of of money movement. Well, what's? Going to happen when you accelerate that, like you accelerate those dollar movement, you accelerate that, you know, interest rates lower, you accelerate more monetary monetary units. It's just going to accelerate what was already happening around money being lost, things blowing up, things deleveraging. And so it ties back to then the recognition of, well, this asset that can sit outside of those walls that doesn't have the counterparty risk related to all the craziness that's happened is going to start to become more and more recognized. And I, it'll be interesting to see how soon that happens. I think is the the big thing, yeah. Maybe before we wrap, should we talk a little little open AI, little AI spend? There was a report from last week that Open AAI, open AI wants federal backstop for their new investments. I think Sam kind of walked this back a day or two later saying like they wouldn't want that, but it's in the zeitgeist now nevertheless. And then this chart I thought was pretty remarkable. So this is showing borrowing to fund AI data centers is exploding. Investment grade bond issuance from AI big tech firms jump to a record 88 billion. This comes as Meta Oracle issued 30 billion in $18.00 billion or $18 billion debt in September and October, respectively. And you can just see this chart, the massive jump in borrowing to fund all this AI data center spend. Thoughts on this is is AI going to become a a public utility as we forecasted a a week or two ago? Mike, you can go first because I know you've been talking about this for a while. I think the the initial start of this was how much capital is being spent and how do you recoup it because the numbers just start to become insane, like more monetary, you know, capital spent than existed. I think believe the, the, the, the way to contextualize the capitals like the GFCI think was 750 billion that was inserted into the, into the system until you look at like, I think they have like a $1.2 trillion obligation or whatever to for the next 10 years in these data centers. So the numbers just never made sense. But it, it was backing into like there's a different play here. I think we've already seen this. It's hard for people to fathom. But whether it's like Palantir, Facebook, Google, there's already these public private partnerships. I think Grauman had a great tweet It was on last week that we were supposed to talk about it. Maybe it's actually, yes, it's this one. If you click on Luke Grauman, the the bottom tweet and then you, yeah. And then you Scroll down, you'll see how he says this will reveal itself, the key difference between the US and Chinese economic models. the US pretends to be capitalist for everyone, but actually socialistically subsidizes its wealthy, but only after the wealthy blow up, while China is a very upfront about its subsidies. And so it's just this reality that we are behind the race, not only from energy production, but around these models and the cost and that it was going to be needed for us to be relevant for these companies to spend. And so I think they said the quiet part out loud. Even David Sachs, the A is our last week on on all in walked it back as well and said, look, if somebody blows up, they're just going to die and we're going to have another person step in. I don't think that's how it's going to work. I think there's too much capital and it'll continue to increase. It'll become systemic and it'll matter for US, you know, continuity, longevity when it comes to everything related to AI and where we're headed as a nation that of course, they're going to backstop and this is where it goes. And then the the real weird part, you know, what's being discussed is a lot of these larger firms like the Meta, Google, I think Anthropic open AI, they're looking for almost regulatory capture when it comes to the capital spent. But then you start to get the lenience like, well, what is that? Is that bad? And then you start to look at what happened during COVID and all the different censorship. It doesn't matter which side you just ultimately come down to. Like when you have these things as not free market enterprises, you have these unintended consequences of, well, if you want to use them, you need to use X. You get your STEMI check. It's just you can see this happening. And we're a few moves away from it really playing out. But how fast AI is moving and how like ubiquitous, it feels like they're going to make it as part of everything you do, you're going to need to be able to pay for the tokens in some way for the inferences. And then that's when everyone ends up kind of stuck having to play ball. And that's again where you want to outside for a money that you're not stuck into that. And then the beauty of Bitcoin is just global interoperable that there's going to be naturally more tooling around that for you to be able. It goes back to the same concept of storing your wealth outside of the system and not having all these intermediaries. Think about when you're building these models and also when you're building stable coins. If you're going to interact with that and from an economic perspective, you have to KYC, you have to onboard that. The market's just going to naturally have this like push pull for centralization versus decentralization of the models. Yeah, I think yeah, Saks walked it back as well. You're right. But, you know, if I just zoom out and think about it like, you know, it is very like the, the parallel to the too big to fail banks is apartment. And that like the way that these companies are currently positioning are as if this, this race to win AI to beat China is too important to fail. You know, maybe it's not as big as the banks were, but like it's too important to fail. And so I, I see a lot of similar dynamics. Like even if you just look at, you know, there, there's sort of a, a growing list of companies that the United States government has taken stakes in, like even as small as like a, a rare earth start up. I think it's called like Vulcan, Vulcan elements or something from last week that like they're now just investing in rare Earth start-ups. Like everything's on the table in terms of public private partnerships. And I do think that that is, you know, they can back step it or backtrack it, talk it back as much as they want. But like that's I think where we're headed because we are losing the, the race to China in terms of just the infrastructure itself, the rarest, the energy dependence. And this is something that that Luke, Luke Growman's been, you know, spot on. And on top of is like that. That is, that is why the we're in this situation where the idea of of a government backstop is even being floated because it may be necessary basically from a, a national security perspective. There is a really big difference between now and 2007, though, which is 2007 was a lot of leverage and essentially allowing the middle and and low and like regular people to buy houses. And this backstopping potential open AI or, or any of these companies would make equity holders. Yeah. Well, that plus like the holders. Yeah. And it's also a lot of these young people feel like they're, you know, not being able to be given a job because these AI systems are likely going to disintermediate the like, youth unemployment rate and things like that. And so I think it's going to be very deeply unpopular. So I don't necessarily feel like a a strong of a view. And, and I feel like the open AI would, you know, benefit large BC and, and other shareholders. There's going to be a way that it's subsidized, but I think it's going to be pretty tricky to walk that line in in a way that's pretty popular, especially when you see the the Zohan's of the world getting elected in New York City and, you know, just the rise of, you know, young people who are socialists in the US. The the thing that's interesting, there's two random aspects. So we do have to wrap though, because it's gone for a while, but like just maybe the we can piggyback on next week is like 1 is this comes up around like the sovereign wealth fund of the US, like makes zero sense because generally sovereign wealth funds exist for a number of reasons and they're not US style countries, whether they have innovation and resources to be able to build things because that's our money. So like if the, the, the natural order from a first principal perspective would be like, just don't tax us. Don't put the things in the sovereign wealth fund to give us our money and we'll go make more money and deliver more value. That's one. The other one is this whole setup for is reminds me very similar to dats where like in in basically the notion of like leveraging debt in cheap capital to buy the underlying goods. So like theoretically it rises the IT raises the price of the underlying. And yes, on a long enough time horizon, I think similar to AI and Bitcoin, if these models exist and they're cheap or, or Bitcoin is more ubiquitous, everyone benefits. But the marginal net new buyers buying gets less Bitcoin for the access. Because at the end of the day, you're just taking effectively money printing and then you're putting it into this unit and you're giving it to centralized entities versus you having more of it yourself to do better with it. You're, you're taking the Fiat system and it's the same thing with, in my view, with the, the model aspect of like, so you're giving these centralized entities the ability to accelerate your job destruction and all of these things. And you're going to have to pay a tax to get access to this public good versus just give me the money and then like give the free market the money and let them go figure it out. And I think the beauty, this is the beauty of of Bitcoin and where we're heading is that at the end of the day, like when the right entrepreneurs and the right capitalist with the right hard money Bitcoin, we'll invest in the right products and services. And then to the point of like inferences and all the things that are on streaming, you'll start to see, I think these AI models and use cases that just require sats. And then that'll probably be a very interesting way for people to onboard because the only way to get it is to go in through being able to pay via Lightning or whatever. And then that company will be generating an insane amount of revenue via Bitcoin as price appreciates, you'll be able to take more market share. And so I think this all shakes out, but like, there's just going to be a lot of destruction, a lot of misaligned incentives. And I think most people would take 1A angle like, Oh yeah, they open AI, they take our money. They're, you know, doing that. But then like the dat thing doesn't make sense. It's like they're both the same thing. They're really taking inorganic cost of capital, too much money because of the system that is basically like rugging everyone and then they're pumping somebody's bags and everyone feels OK with it. But the second third order consequences being a lot of people end up on the other side of that trade negative. Yeah, well said. Anything else, boys? Should we wrap? Yeah, just call out the we didn't get to chat on it maybe next week. But the the Bitcoin standard report, I thought that was a good report came out from the early Riders team just breaking down what would it look like really just investing from first principles again and looking at the Bitcoin standard and then where we're headed from there. I think that was a great report to. Yeah, it's a great report. We'll we'll link to it in the show notes. I found it particularly interesting in the in the sort of respect that when most people think about the gold standard or a finite money supply, they, applying their Keynesian level thinking to it, think that the economy collapses under a a sound money, when in reality that's just not the case. We operated under a gold standard for hundreds of thousands of years. And so this piece does a great job of drawing that parallel to what things looked like under a gold standard and what they might look like under a mature Bitcoin standard. So we'll link to this in the show notes. As well as he looking at investments right now as as Bitcoin continues to monetize. So yeah, I would definitely recommend checking that out. All righty boys. Awesome. Thanks and see you next week. Later. Thanks. Thanks for listening to this week's episode of the show. 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