Jerome Powell and the Fed just restarted the money printer.
And just to be clear, everybody, this is not QE.
I repeat, this is not QE. It's reserve management
purchases. Regardless of what they want to
call it, the Fed is purchasing $40 billion in Treasuries a
month starting today. And for the first month, they're
going to actually purchase $54 billion.
Call it reserve management, call it technical operations, The
markets don't care. Liquidity is rising and gold
stocks and Bitcoin should respond accordingly.
Meanwhile, the the FTC chair just announced that Bitcoin can
be used as collateral by big banks and ironically, Michael
Saylor was also posting a picture cryptic picture from
himself inside of a bank. I believe that this marks the
beginning of Microstrategy's Bitcoin strategy making its
profits go through the roof. All the noise about them not
being a profitable company might have just gone out of the window
with this announcement. And I'll explain exactly why.
These are huge stories for Bitcoin heading into 2026, and
I'm going to break it down. This is Dante Coke with Bitcoin.
Simply, let's go. Can you imagine a press
conference with Jerome Powell at the podium?
So we're going to start reserve management purchases at $40
billion a month starting tomorrow.
We're doing this to maintain liquidity in ample reserves in
the system. This is not QE.
I repeat, this is not QE. These are called reserve
management purchases. Question for you in the back.
So Jerome Powell, let me get this right.
We're creating $40 billion a month out of thin air that
doesn't have to be repaid by the banks that are being injected
directly to the banks. Is this not just another form of
quantitative easing? Yeah.
Someone please remove Susan from the press briefing room
immediately. Thank you.
The New York Fed, regardless of what you want to call it, says
that they're taking the $40 billion a month and raising it
by fourteen, $54 billion in Treasury bills are going to be
purchased tomorrow and injected directly to the banking system.
These are always permanently temporary programs.
When Bernanke said the QE program starting in 2008 and
2009 was temporary, well, it's been rising ever since.
Look at this chart. The temporary took off in 2009
and it grew all the way until 2020 where it exploded.
It's how the system works. At this point.
Debt must expand and the dollar must be devalued in order for
the US dollar hegemony to continue to work and operate
around the globe. And This is why assets like
stocks, gold, and Bitcoin always go up over time.
These are fixed assets that are being flooded with an unlimited
supply of dollars. But let's be clear, these
purchases alone aren't enough to move markets.
However, it's a major pivot in Signpost.
When you couple this with the plans of the current
administration, well, you have to be bullish on assets like
Bitcoin going into 2026. This administration is clearly
of the opinion that we need to be in growth mode.
Is also market should go up and we should keep driving it up and
have it keep going up and let it be much, much bigger, much, much
better. And you know, growth doesn't
mean inflation. They're always afraid that all
we have and if there is inflation, that's OK, then we
can slow it down. But we should be able to do a
lot better than three and four. We're scheduled to be at 4%,
which is pretty amazing because we have a, you know, deadhead
Fed, Fed hair. I mean, this guy, the head of
the Federal Reserve is a stiff and, you know, you fight that.
It's amazing. We fight that.
And yet interest rates are going down, except with him, not too
much. He did a, he did a rather, I
would say a rather small number that could have been doubled, at
least doubled. He said the rate cuts should
have been at least doubled from the 25 basis points that we just
got earlier this week. When you couple this with the
fact that the administration has a ton of ammo in order to go on
growth mode, they just announced that they had the lowest
deficit, 52 billion, the lowest deficit since June of 2020.
This is pretty big news. -52.8 billion.
That's a better lower trade deficit than we expected.
We were looking for a number closer to 62 billion.
And that follows a revised -59 billion -, 52 billion would be
the lightest. Going back to wow, we're really
going back. Well, my records go back to 1992
and to find a smaller number that mine is 52 billion, we're
all the way back to June of 2020.
And when you couple this with the fact that the president said
that the only imperative for the new Fed chair to come in is to
lower rates and to do so immediately.
I want to ask about interest rates because a lot of Americans
agree with you that they're too high.
You're going to pick a new Fed chair soon.
Is it a litmus test that the new chair lower interest rates
immediately? Yes.
Donald Trump didn't even let her finish her question.
Yes, that's how eager he is to cut rates.
And no wonder he's so eager. the United States has a massive
problem on their hands. Look at this blue bar on this
chart. This is $9 trillion worth of
debt that is coming due and needs to be refinanced in 2026.
Well, they're going to be refinancing them at much higher
rates than they were when they were virtually 0 when they
borrowed them in 2020, which means the interest payments that
we are now paying are going to go up dramatically.
We're already paying over $1.2 trillion a year in interest
payments. This means that this
administration has to go, go, go and grow, grow, grow.
That's the only way to outpace the interest payments in the
amount of debt that we need to supply the system to actually
grow. And all of these things are
massive catalyst for Bitcoin, not to mention the fact that the
CFTC chair said that Bitcoin can now be treated and used as
collateral within the financial system.
Well, good morning and thank you so much for having me here on
the show. So I think what's really
important to understand is that we are doing a limited pilot
program that has important guardrails that are in place
because we've seen with the events that have happened on
offshore exchanges that it's more important than ever that
Americans deserve safe U.S. markets under US regulations.
So what we've done to structure this pilot program is that if
you are using a CFTC broker, which is what are our futures
Commission merchants, those are registered by us, those are
overseen by us and the National Futures Association, which is
like FINRA, you will be able to use Bitcoin, Ether and USDC to
collateralize contracts that are denominated in those Bitcoin,
Ether or USDC and it's basically in kind collateral.
So that's very limited in what you can do.
You can't use it instead of cash for example, but you can use it
to collateralize those in kind contracts and then we are
putting into place. Just to be clarify, it's.
In kind so. Bitcoin for.
Bitcoin, or could it be Bitcoin for Ethereum?
Bitcoin for Bitcoin. So if you're going to settle in
Bitcoin, it's denominated in Bitcoin, you can collateralize
it with Bitcoin because it's the same way risk.
And we have enhanced CFTC monitoring and reporting in
place. So for three months we are
requiring that we not only get weekly a position and asset
class reporting that's on top of the normal reporting that our
exchanges do, but we are also asking for a reporting of any
significant operational issues relating to that digital asset
collateral. So again, this is a Safeway to
understand the technology, to understand the uses for these
assets, but in a controlled way. There's been a lot of talk about
why Bitcoin is valuable and why Bitcoin treasury companies have
been stacking Bitcoin, and Jack Mahler's has been recently
talking about why they have an opportunity that's been left in
the market from Coinbase and from micro strategy not offering
and creating digital credit and digital lending products.
Well, I think that window is actually being closed.
Listen to Jack talk about this here and I'll tell you why that
he might be wrong and behind the ball.
Said listen, you know bitcoins compound annual growth rate over
the last five to 10 years, call it 50% a year of an easier way
to conceptualize that level of growth is it double S every 18
months. People want to create a cash
liquidity event with their Bitcoin without selling it,
without having a capital event, a capital trigger on that.
And so the fact that there isn't a market for them to borrow
against it for different credit products, lines of credit termed
loans, we think we can live in that space.
We are shocked that this is a $2 trillion asset class going on
what we believe to be 20 trillion and 200 trillion.
And there are fundamental financial services that no one
of our scale and size is focused on, right?
We look at a coin base and we're like what a successful business,
you know, in earnings and in net profit, but nobody's focused on
Bitcoin credit. And we look at a strategy,
acquired a lot of Bitcoin, but nobody's building products.
I believe that strategy is actually going to beat them to
the punch. MicroStrategy holds 660,624
Bitcoin, and now they can effectively begin leveraging
that collateral to lend to other banking partners and
institutions who want to get into Bitcoin.
Their CEO, Fong Lee talks about this right here.
Fong, to switch gears just a little bit, in terms of other
types of businesses that strategy could be involved with
lending a Bitcoin, it reached a record high in the third
quarter. Why hasn't strategy gotten
involved? Yeah, we, we run a very simple
business, right? I've been, I've been doing this
for 10 years now, five years with Bitcoin.
We buy and we hold Bitcoin. I do think over the course of
the next year and I'm quite excited about it.
Traditional finance entering the Bitcoin world, companies have
made announcements, Citibank, Morgan Stanley and others.
You know, big real banks are going to offer custody service,
lending service and staking and otherwise.
I think when they enter that space and we have different
counterparties, it's something we would we would consider and I
think would be enthusiastic about.
They're going to now effectively be able to gain a yield on the
Bitcoin that they hold as a treasury asset when they lend it
to other institutions who are looking to get into Bitcoin.
This aligns with the In Kind conversation that Caroline Pham
announced the CFTC chair in that former clip, and this means that
MicroStrategy is going to be able to generate massive amounts
of profits from their own Bitcoin stack.
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Bitcoin. Adam Back just talked about
major banks getting into Bitcoin recently, talking about how this
is a major move for Bitcoin and its predictions are already
coming true. Yeah.
I mean, I think, you know, having experienced the previous
5 and 10 years and things have moved much, you know, in the
short term, people don't see this speed of development.
But if you go back five years, it's, you know, it's pretty
surprising where we are. If you go back 10 years, you
wouldn't have expected at that time all of the major banks to
be buying to provide Bitcoin related products and services,
making more portfolio recommendations, soften wealth
funds, buying Bitcoin, pension funds, all, all of these things.
And there's been a lot of regulatory improvement over this
past year as well in terms of the types of banks that are now
able to be custodian. So I think that opens the gate
for people. Major banks are rolling out
Bitcoin access and they're going to need the backing of Bitcoin
and crypto native companies to do it.
Like PNC who's working with Coinbase in order to offer
Bitcoin backed services to their customers.
They're going to be rolling out buying, holding, trading and
lending products and credit products to their customers in
2026. You couple this with the fact
that more everyday Americans are going to be getting Bitcoin
through this type of Ave. But what if they're also holding
an in their retirement accounts? Congress is begging for Bitcoin
to be held as an asset in their 401 KS.
Can you imagine $9 trillion worth of retirement assets
flowing into Bitcoin? What if everyday Americans hold
it in their banks, in their checking accounts, in their
retirement accounts? Do you really think Bitcoin is
going to 0 at that point? And This is why we are in the
digital gold rush and why Bitcoin is going to go up 20 to
50% a year for the next decade. It's not going to take much for
this entire market to move. We're in a digital gold rush
over the next 4 to 8 years. We think institutional adoption
increases drastically. We think sovereign adoption
increases drastically. We think digital credit starts
to permeate throughout the rest of the market because of that
those dynamics, you've got even the Bitcoin ETF being the most
successful ETF in history. That success is going to breed
more success and it already has. So because of those dynamics,
the macro environment we see probably next 4 to 8 years
between a 30 to 50% compound annual growth rate for Bitcoin.
And we think that will start to taper off as economies of scale
and large economies of scale start to come into play.
Once bitcoins at a $10 trillion assets, it's probably going to
be significantly less volatile and the compound annual growth
rate will will be reducing over over time into the future.
But you think we get 30 to 50% over the next decade?
Yeah, I'll take it. Yeah, I'll take that.
Right. I mean, you look, you look at
the last is 7 years and it's been like 7070% compound annual
growth rate even what in 2022 is at 16,000 and what we're in
90,000 right now. What is what is that?
That's annualize that that's, that's you know, 7080% probably.
And I don't think it takes a lot of capital to to to move it, to
move it much higher. And so one of the interesting
things in the Treasury world is that like when strategy came
out. We have plenty of ammo right now
and there's still plenty of people that are bearish heading
into 2026. We have the money printer or
shadow QE reserve management purchases of $50 billion a
month, albeit not a lot starting to happen, which means this is a
major pivot for the Fed and for this administration removing
from a scenario of quantitative tightening to quantitative
easing. And when you couple this with
the fact that this administration is in go, go, go,
go, grow, grow, grow mode because they have a bunch of
debt due and because this president and this
administration is very clear about their stance on growth and
moving the American industrial revolution forward.
When you add up all of these things and major banks getting
into Bitcoin, you have a scenario that is a bullish
cocktail heading into 2026. These are just my thoughts, but
what are yours? I'd love to hear them in the
comments. One of the ways that you can
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This is Dante Coco Bitcoin Simply.
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