Yeah. Thanks so much for coming on.
I've been following you with lots of interest and all the
other guys at Kit Analysts, right.
And I think even within the past year, you guys have become a
formidable force. And we'll definitely talk about
that because I think it's very interesting how, you know, the
whole open source decentralized nature of of Bitcoin has also
permeated into the investing communities, which I think you
are a leading figure in. So we'll touch upon that.
But yeah, I was thinking maybe interesting to start with, you
know, talking about why the the use case of of Bitcoin for an
individual is basically the same As for a corporation.
You know, like I kind of always describe it as like lower the
uncertainty towards the future. So you make sure that that you
survive. Yeah, you can probably explain
that more in detail. Why that's of course also
important for for corporations. And then, you know, capital
allocation. I think your insurance angle is
very interesting by the way. So yeah, maybe that's a nice
start. Absolutely.
Let's get into it. And you know, it's timely
because I'm, I am moderating a panel this weekend on at the
Bitcoin MIT Bitcoin Expo on Bitcoin adoption for
corporations. And I think it's this phenomenon
that's occurring and happening across the globe as companies
are posed with the question of how do I protect my treasury and
how do I protect my assets so I can operate into the future.
And, you know, in the case of strategy, they were at the
situation in 2020 where they were looking at this big pile of
cash and struggling to see, you know, recognizing that there was
going to be inflation on the horizon and recognizing that
they they were kind of stuck in, in their business operations
unless they did something they were trying to find out, OK,
where do I invest all of my money?
Do I invested in computers or, you know, real estate or, you
know, what do I do recognizing that the the world is changing
in front of my eyes. And in that analysis, they
recognized that Bitcoin was the the best possible place to park
their money for a long term store of value to help, you
know, you know, make the company withstand changing market
dynamics and changing market environment.
And so where we're at in this new future, what we've got first
movers, right strategy has been a first mover.
And now you've got what the the the dozen companies that are
adopting a Bitcoin treasury strategy or leverage Bitcoin
treasury strategy. And what we're starting to see
in this evolution of the space is that you companies are are
very levered and focused on a heavy Bitcoin treasury strategy.
And then there are some other companies that are adopting this
as a diversification of, of assets moving forward into the
future. So that's, that's where I think
a lot of these companies are going to start dipping their toe
in the water of, of adding Bitcoin on their balance sheet
is just allocating 1% of their portfolio to or 1% of their cash
assets into Bitcoin, recognizing that there's, there's a lot
going on in the global macro landscape, in the political
landscape, not just the US and other other nations as well.
And there's this opportunity to have this diversified asset
that's got a finite supply and may continue to outperform, you
know, all other potential assets that you may be able to hold.
So there's this constant, you know, when you're running a
business, there's this constant opportunity cost of capital
equation that you're faced with. If I, I've got, you know, just a
few options. I, I, I can do with my cash.
I can hold my cash in cash. I could reinvest it into the
business. I can buy the stock back or buy
a piece of real estate or, you know, whatever that may be.
And now you have this new alternative where I can park
money in a finite asset, a finite digital asset, a
commodity that has potential price appreciation and it's
likely going to outperform all other all other products.
So in fact, I just started another podcast with Ben
Workman, Tim Kosman and Matt Cole, Strive CEO called the
hurdle rate podcast and and we explore this very topic where,
you know, there are some companies that are starting to
explore Bitcoin, the performance of Bitcoin on a long term
horizon as the hurdle rate for alternative investment.
So some of the questions that the CE OS are asking is, you
know, somebody comes to them with a proposal of how to run
their or, you know, a project that they should work on.
And the question back to them is, will this be Bitcoin?
Yeah, yeah, yeah. And and I, I think that's a
valid question that some of these companies should start to
explore and think about the opportunity cost of capital in
that way. And one of the big hurdles that
a lot of these companies have been faced with historically.
Is this just the legacy framework of quarter over
quarter performance or year over year performance that has just
been in place forever, right? Like the stock market's really
focused on earnings per quarter or earnings per year, whatever
that may be. Whereas if you zoom out and you
look at bitcoin's performance, you look at it on a four year
horizon or a five year horizon and you start to see it as a
duration asset similar to something like real estate,
right? You're not buying a piece of
real estate in a month and selling it the next month.
You're sitting on it for a decade and the because it's
digital and and fast, it's a digital and fast economy.
People see it as a digital and fast asset, but it can have a
lot of value on a balance sheet as a duration asset or a long
term asset similar to real estate.
Yeah, yeah. I thought it's all interesting,
right, Because you know, the, the question was like, what is
the difference? Or I'd say the know, what's the
same thing for like an individual and and a company,
right? And it's more about, you know,
if I have money today, but I don't want to spend it today,
what do I do with it, right? And I think for companies, it's
probably way more apparent. I think also because they
operate in an environment, as you just mentioned, of growth,
growth, growth, right? Like it's basically forced first
growth, which, you know, we could go into, but that's also
kind of like a Fiat, right? So Fiat and so it is way more
apparent for them that when they have cash, they need to figure
out, OK, what do I do with it? Right?
And I, I think, you know, Seder famously explained like I went
through everything, you know, stock buybacks, acquisitions and
all this thing, all these things, right when, when he
explains how he ended up with, with Bitcoin.
So I don't think it's actually surprising that companies are
starting to do this because you know, where I think, you know,
individuals could be enticed by new sneakers or, you know, some,
some fun gadget or a new Nintendo or whatever to spend
their money on. In a sense, you know, company
leadership is, is already focused on a bit more longer
term perhaps than just, you know, the general individuals.
So their their use case is way more way more apparent.
And yeah, I love the hurdle rate idea because, and again, I think
with companies, it's more apparent that if you don't have
Bitcoin as your hurdle rate, it becomes really, I'd say more
unclear if you're making the right investments basically.
And when you put Bitcoin as the hurdle rate, I actually talked
about this last week when we talked about startup
investments, for example, like they're it, it's the same
basically, right? So I told you just off mic, like
I've I've a background in, in like the the Web 2 startup
world. And that's like a spray and pray
game, you know, like the whole VC game that's literally upon
our pyramid scheme. And they're, yeah, just bad
ideas get funded. And once you take Bitcoin as the
hurdle rate, you're just becoming way more diligent as to
what am I spending this capital on?
That's also something I learned along the way.
You know, capital is basically economic energy.
You, you know, how do you say pile up in order to eventually
invest, you know, into, into something and.
Yeah, so underwriting, the underwriting of the deals gets
much sharper, right When you think about Bitcoin as the
hurdle rate, you're like, OK, I need to be a lot sharper in how
I'm thinking about things. And you know, it seems like the
last decade of VC has probably gotten a little loosey goosey
We're. Going viral.
Our growth strategy is going viral.
You know, that's what they said. And then they're like, Oh yeah,
that's that sounds great. Yeah, sure.
Here's 10 million bucks. Yeah, exactly.
Yeah, well, that's also the problem, right?
Yeah, yeah, I, I think it might be helpful to, for, for your
viewers to understand like financial companies as well,
right? Like I think it's pretty easy to
conceptualize, you know, a, a company, I don't know, like, and
just any typical corporation adding Bitcoin to their balance
sheet like Nike or something, right.
You sell a product, you have net income and you store some, some
of your net income in Bitcoin, right.
That's like a, a simple perspective of, you know, how a
company works. Now there's this whole separate
realm of companies that, you know, everybody's familiar with,
but probably not understand, doesn't really understand the
the design of these companies. And it's insurance companies,
banks and pension funds. And so insurance companies, how
insurance companies work. And I think the design here is
really important and understanding.
So how insurance companies work is they are collecting premiums
in day one, right? So like when you when you pay an
insurance premium to an insurance company, that company
is collecting the premiums and they're investing those premiums
over time to pay out a future claim, right?
So they know that you or you know, somebody else next to you
is going to make make a claim at some point in the future.
And there's a whole bunch of math that goes on behind the
scenes where those insurance companies are calculating like,
OK, what, you know, what are my claims going to be 10 years from
now, five years from now, whatever that might be.
And so when, when those insurance companies make those
make those decisions and make those calculations, they, they
buy different types of assets. So, you know, they may buy 10%
of their portfolios and inequity and then 70% of their portfolios
in bonds. And then, you know, 10% is in
treasuries and, you know, different, different things like
that. And every insurance company is
designed differently. Now, every single one of those
insurance companies subscribes to the concept of Markowitz
Modern Portfolio Theory, which means if you have a a
diversified pool of assets, if you add a new asset to that
diversified pool of assets that has different risk return
metrics, it improves the return and reduces the risk of your
entire portfolio. OK, now, now enter onto the
scene. Bitcoin, right?
Bitcoin is unlike anything else in the market, right?
It's got a completely different subset of people that are
investing in it, buying it, you know, going in both directions.
And it's got a different risk return profile than any other
asset in the entire market. A lot of people are mentioning
that it moves similarly to QQQ or, you know, risk assets or
what not, but there are days where it doesn't.
And so when you when you think of Bitcoin as a new asset class
with a different risk return metrics, it is the perfect asset
to add to a diversified portfolio or pool of assets,
especially if you're thinking about having to pay out claims
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I wanted to touch upon insurance because I heard you say in
another podcast and, you know, you have an insurance
background. Yeah, how how do you model for
the future when you know, the money is, is, you know, being
debased even more rapidly? You know, like how do you, how
do you plan 20 years in the future?
And that's when I heard you make the use case for, you know,
Bitcoin for also insurance companies.
So I found that super interesting because they're in
that business model. It's even more apparent to have,
yeah, this is a simplified version, but to have an X amount
of dollar units, you know, to be able to to pay for, well what
you promised to pay for, right. That's the value proposition of
an insurance. I think it's again similar to
for individuals. Yeah, yeah, it's, it's an
interesting phenomenon and I, I think that's in that calculus,
right? I, I don't know how many
insurance companies there are in America.
Thousands, right? Like there are thousands of
insurance companies in America. And if you think about each one
of them is making their own calculations on what their
claims are going to be in the future.
And there are people that are making those calculations,
right. And if your calculations are off
by 25 basis points on like what you think the claim is going to
be 10 years from now, your business model doesn't work.
Yeah. Right.
And, and, and so we're, we're seeing that kind of happen a
little bit over time where, you know, medical claims inflation
is outpacing the, the CPI and, you know, these insurance
companies are, are grappling with CPI figures.
How do, like, am I, am I, am I getting all of these numbers
right? And, and something we've seen in
the insurance industry is this concept of social inflation,
which is really, in my opinion, just a debasement factor where
the insurance industry is claiming that these these claims
are larger. Like some of the claims that
they've had are, are larger than they've been in the past because
of these jury verdicts that they have, that they've had that
which have been significantly larger than the past.
In my opinion, the jury is just understanding that there's more
money in the system and saying this, yeah, like this, this
claim should be a $5,000,000 claim when in the past it should
have been two and a half million dollar claim.
Yeah, yeah. So this is happening on a
massive scale, this. Is play Fiat games, get Fiat
prices, Yeah. Exactly.
Yeah, 100%. This is, I love the sorry, I
want to, I want to point this out like this is the 0 sum Fiat
game mentality, right? Yeah, just because the money is
there. Yeah, I should, you know, take
advantage of the fact that there's a big pool of money and,
you know, it should be claimed, basically.
Right, right. Yeah, it's so there are some
challenges with the insurance industry, right?
This is a, this is a financial, this is a financial business
that can greatly benefit from adding Bitcoin to the balance
sheet. Now here's the problem is that
insurance companies, if they were to add Bitcoin to their
balance sheet, they get 0 regulatory credit for it, 0.
So that means you have 0 ability to lend against it, right?
Like you have 0 ability to leverage against it.
Like on your portfolio, like how much premium you could bring in
the door, how much risk you bring in the door, you have 0
ability to lever get lever against it.
Now that's, that's a really big problem, right?
And it's like, well, here's a new asset class that I need to
add to My Portfolio. But the regulatory environment
has created a lid on innovation. And it's, it's really, it's a,
it's a fascinating conundrum. And then the industry moves so
slow it it's probably going to take a long time before
regulators or rating agencies understand that this is a really
valid form of capital that can be used with a long Longview
horizon. Yeah.
And so why, why is it so interesting then to to use
Bitcoin as as a collateral, you know, collateral or use it as
collateralization of of the balance sheet?
I mean, just as individuals, you know, are buying real estate and
stuff like that, why is specifically Bitcoin so
interesting for for companies? Yeah, well, it it is a it is a
power, it is a powerful form of collateral.
And I think just kind of going back to this to this concept of
this insurance company, just to finish this thought here.
They can't add those product, they can't add Bitcoin to the
balance sheet and leverage leverage against it.
But you know what they can add is publicly traded equities.
They could add preferred stock from publicly traded equities.
They can add convertible debt from publicly traded equities.
They can add debt from publicly traded equities.
So now, now you've got multiple different vehicles, right, that
can provide Bitcoin exposure. So these insurance companies,
for example, they can explore adding assets like
Microstrategy's convertible debt to the balance sheet or the
preferred stock. And all of a sudden you're
getting proxy Bitcoin exposure and you get credit to leverage
against it. And you're, you're filling this
product market need, right? Like the insurance, the
insurance industry needs this product and strategy saying,
perfect, I can design and create this product and deliver it to
you. So you can get your Bitcoin
exposure on your balance sheet, fit within the regulatory
framework. Just basically get around those
regulatory lid on innovation and have that exposure to your, to
your company. The industry hasn't figured it
out yet, right? Like 99.9% of the insurance
industry probably doesn't hold the stuff on their balance
sheet. And I, I think they will.
And they'll, they'll largely wake up to it in the future.
Do you think there's like a a catalyst for that?
Like when is that? When the money printer goes on
again and they realize that their problem is actually
probably bigger than they than they thought before.
Or like what do you think? Yeah.
It could be pain, pain in the market, which is kind of what
you you've indicated there. That's a, that's a deep
question. OK, that's a, that's a really
deep question. And my brain is going a bunch of
ways. Yeah.
So just in that that to get too complicated.
But with the with the insurance companies, right, you have this
expectation of how many claims you're going to pay out.
You get the premium in the door, you're going to pay out claims.
Now there's also the second layer of insurance called
reinsurance, which is insurance for insurance companies.
And I'm not going to get too deep, but it protects against
volatility, right? So if, if you, if you're an
insurance company and you have a hurricane hit your entire
portfolio in Florida, you go, oh shit, I, I, I have to liquidate
all my assets in order to pay for my Florida hurricane claims.
So what does the insurance company do?
They buy a policy from the reinsurance market that protects
them against volatility on their balance sheet.
So they don't have to liquidate all their assets in that
individual time. So within the reinsurance
market, the reinsurance market is very fluid and with with far
less regulation in the entire market.
So the the reinsurance market can move and reprice things very
quickly within a year, right. The reinsurance market can move
and price really quickly. Whereas the insurance market is
incredibly regulated by the state and their their rating
agencies that impact how much you can raise rates and charge
and do all this stuff. So the if there's large capital
draining events in the market on top of an inflationary like
money printing scenario, let's say you've got an earthquake or
a big hurricane hitting Florida or wildfire in Southern
California, or you know, these big capital drains on the
market, the reinsurance market is going to reprice that very
quickly. And when the reinsurance part
market reprices that that flows through to the insurance
companies PNL like their their profit.
And so they've got to be able to, you know, charge that in
underwriting and their whole calculus of like how much money
they need at a future point in time is revamped.
And so like it, it, it will take pain, whether that be
inflationary environment, catastrophic disasters, or, you
know, some combination of the two of those in order for these
companies to to react. Probably that to see like a big
like a big large scale reaction I would suspect.
Yeah, it's very interesting. Again, I think it's similar for
for individuals, right? Like, we can talk about Bitcoin
for individuals, we can talk about Bitcoin for companies, but
as long as people don't understand the predicament
they're in, then don't. Understand a problem right?
Yeah, exactly. So that that's, that's I think
also why why Sailor is eventually so visionary.
And I want to I want to dive into micro strategy.
But first, yeah, he he was the 1st.
Now, as you mentioned, you know, he has more products, right?
He he's got, he's making basically very specific
financial products to raise money to eventually buy Bitcoin,
right? They have Stark, they have
strife. There's other companies like
Metaplanet, similar Scientific, you know, there, there's,
there's many other companies that are following Rumble, I
think is a company that many people might know.
Yeah. Where, where is this going?
I mean, well, GameStop, you know, last week shared that
they're going to put Bitcoin on the balance sheet.
Yeah. Can you share a bit about this
development and and where do you think this will spread further?
Yeah, it's, it's developing very quickly.
And I, I think, you know, everybody, we're, we're in this
modern society where everybody thinks things move like really,
really fast, right? Like if I make an order on
Amazon, it shows up to my house in less than 24 hours, right?
Like it, it's it we're in this like fast moving ideology
economy, but the reality is some of the stuff takes time, right,
Like having communicating with your board or making changes to
your business model or understanding that I need to
change my business mix or like sell a piece of real estate in
order to buy Bitcoin or, or you know, whatever that might be.
That takes that takes a lot of time.
And, and where, where I do think this this market is going is
that we're going to see significantly more corporate
adoption of Bitcoin on the horizon.
And I know there are material number of people that are, that
are working in this space to basically tell the market, it's
OK to dip your toe in the water here, right?
Like the water's warm, like come, come check it out.
And here's in it requires a bunch of people talking and
communicating about, you know, what, what can this asset be,
right? You have to, you have to tell
the story of the asset. So a lot of people are working
to tell the story of the asset, what it could potentially be,
how could benefit your company, how to think about it as a long
term asset and a network asset. Tell them some of the basics,
right like this, this thing isn't going anywhere.
It's backed by math. It's backed by the largest
decentralized computer network on the planet.
And you know, getting people to understand that is that just
takes a lot of time, right. You 100 hours at least before
you start to really grasp what's going on with Bitcoin.
But I, I think we're, I think we're in this scenario where
significant number of companies are going to start adopting
this. And you know, success brings,
brings more success, right? So you, you start to see
companies that thrive and you start to ask why, why is that
company thriving? You know, why is my competitor
thriving? Why am I losing business to this
competitor? What are they doing better than
I am doing? And how can I, how can I copy
them, right? How do I, how do I beat them?
Can I beat them? And, and we start to see the
scenario that is a little bit of a domino effect where, you know,
every in the traditional finance world, a lot of people think
strategy, MicroStrategy, strategy is a, is a Ponzi scheme
pyramid scheme. They've gone from a $2 billion
market cap to an $80 billion market cap.
And the traditional financial world like can't wrap their head
around it. Now it's going to go from 80
billion to 200 billion to 500 billion.
And the traditional financial world is going to have to say,
wait a minute, was I wrong? Right.
What was I wrong about this company?
And what what the hell is going on here?
And what what do? What do they know that I don't
know? And that's one of the reasons I
think this is going to be the most hated rally of all time,
right? Like so many people just hate
that there's so much success happening in a space because
they just don't can't conceptualize it and don't
understand it. And so, so we're, we're going to
see this evolve over time where more, more people are starting
to dip their toe in the water and say, OK, well, maybe I'll,
maybe I'll buy it for myself 1st and understand how this thing
works. And then they're like, whoa,
hold on. This is if it's good for me,
it's good for a company, right? If it's good for me, it's good
for a company. If it's good for a company, it's
good for a country, it's good for a nation, right?
And you, you start to, you start to go down this orange pill
rabbit hole. And, and I think, I think we're,
we're in this point where like adoption is accelerating, like
we're still like increasing at an increasing rate.
And I think the next 4 to 8 years, we're going to see that,
that continue significantly. I think we're going to see a lot
of companies that are adopting a strategy.
We're already in communication with, you know, a dozen
companies on a smaller scale, like private companies that
don't have a board of directors to report to, right?
They're, they're individually owned companies.
The, the owners are orange pilled and they're like, well,
I, I want to add this to my back, my corporate balance
sheet. I want my employees to succeed
here. I want to attract good talent.
I want to, you know, do bigger, better things in the future.
And like, I don't think I could beat AI.
So I have to do something. And this is this is the option.
Do you think we'll see like a big company like adopting like
Zuckerberg has a majority voting rights and Michael Dell is
hinting at Bitcoin for over a year now.
You know, I tweeted at him jokingly, like if you adopt
Bitcoin, I'm going to buy like Dell computers and make miners
of it. Like you should launch miners
like I mean, I think he's totally into Bitcoin or maybe
Amazon. Like, do you think it needs like
a big company to actually really take away, let's call it career
risk or image risk or whatever? You think about some of these
larger companies and I don't know, you got a the CFO of Dell,
like I don't know who the CFO of Dell is, but I'm sure he's
sitting there like, dude, what? Are you?
Yeah, what are you doing right? Like you're paying me like
$1,000,000 a year, you know, like I, I'm not going to buy
this shit. Like you're crazy, right.
And so, so I'm sure there's so much of that going on, on the on
like a large if, if your company's worth more than $10
billion, I'm sure like, you know, see if I was getting paid
more than more than 1,000,000 bucks a year.
And that's the, that's the way that those, you know, they're,
they're like, you're crazy. I, I don't, I don't, I'm not
doing this. And so I think there's a, a
lower probability that we see some of those large, large scale
movers move now because they, they don't need to, right?
They're successful in their own way, particularly like mag 7,
right? They're MAG 7 because they've
succeeded doing what they're doing.
So they don't, they don't really need to adopt something new, but
but they can. And I, I don't think we're going
to see a scenario where, you know, Meta comes out and buys
$50 billion worth of Bitcoin and there's a low probability that
maybe they dip their toe in the water and say, Hey, you know,
we're going to run a new, we're going to run Bitcoin for our,
you know, commerce in the metaverse, right?
And all, all of a sudden you're like, wow, OK, that's an
interesting concept. And you're like, maybe that
works. And I mean, let's, let's be
honest, we already have basically a mag seven that holds
Bitcoin in the balance sheet. You got Tesla that holds 10,000
or 11,000 Bitcoin. And you've got, I mean, SpaceX
is a private company. I think they hold something like
9008 thousand 9000 Bitcoin as well.
So you've already got a couple big companies that are holding
it on their balance sheet as an asset.
I, I think kind of where, you know, looking back at what's
going on with Elon Musk being in the political sphere, being
around Trump and what's going on politically with the Doge, I, I
wouldn't be surprised if he maybe leans in a little bit
harder to Bitcoin. But once he's done with his doge
term, which I think is July. Which is I think it's.
July of this year. Well, he's notoriously quiet
about it, don't you think? Yeah, I think he's like
exceptionally quiet. And I found out the other day
that SpaceX holds Bitcoin. And I was like, holy shit.
Yeah, Yeah, that that was a surprise to me.
And that was just completely under the radar.
If you have your Bitcoin in self custody, where are you keeping
your Bitcoin seed words? For me, there's only one way and
it's backing up my seed phrase with stamp seats.
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Com Oh yeah, now they hold it for like I think 3-4 years
already. Yeah, it's it's all like old
news. But maybe, you know, if I put my
crazy strategy, you know, not strategy company, but strategy
cap on, you know, just as like sailors talking about, you know,
we should devalue the gold, buy Bitcoin and then we, you know,
wreck, wreck all the other countries that hold the gold.
I mean you, you said they are the Max 7, you know because they
did stuff, but they are also the Max 7 because they are the Max
7. And innovators and.
Yeah, no, but I mean, also because they have the highest
allocation in S&P 500, like they're passive investing
whether they mess up or not. I mean, today I saw a lot of
tweets about the I, you know, new Mac update that breaks
iCloud or whatever. People hate the photo app on on,
on the iPhone, right? But people invest in Apple
because they are part of the Mac 7.
Let's say you are, let's say Zuckerberg, right?
If you adopt A Bitcoin strategy, I mean, I think it's you who's
tweeting about, you know, strategy move this amount of
companies in the S&P 500. You know, let's say you are in
the Mac 7 and you adopt Bitcoin, you know, or so could be Amazon,
then yeah, you kind of pull away from the Mac 7.
You're going to be in in a league of your own, right?
And then correct other companies that have Bitcoin on their
balance sheet like strategy, which is then the biggest.
Yeah, they're going to, they're going to move up.
So I do think there's an interesting potential for some
sort of game theory there because in essence, they are
also battling for these passive flows from the S&P 500, like I
mean, it helps them of course, to operate their business.
Right. It it always it always helps to
be higher up on the on the ranking.
I'm, I'm obsessed with the ranking of the market cap
ranking of all these companies, because once you get up to the
top, like top 20, there's, there's no real good way to
compare one equity to another equity, right?
Like how do you compare Exxon to JP to to JP Morgan Chase and to
Meta? Right.
Like yeah, you tweet micro strategies between garbage bags
and something I don't know. Yeah, between Sherwin-Williams
paint and, you know, waste management garbage.
Yeah, exactly. We're going higher, right?
Like this thing is going higher. Yes, but that's good.
That's rational translation and I'd say, you know, just not
looking at the numbers, but more like, yeah, is micro strategy
worth more than a waste management company?
Yeah, that's like, yeah, yeah, I think Bitcoin's worth way more
than a trash like the the trash companies of the world, right.
So that's, that's kind of the frame, the general long term
framework that I operate within, like either either everything
else is way overvalued or strategy and Bitcoin companies
are way undervalued. And it's like, OK, I, I'm, I'm
going to take the, the position that strategy is way undervalued
and Bitcoin is way undervalued. That's, that's kind of how I how
I view it, but I mean, go back to the point here is once, once
you're in the top 20, the, the only way you can compare these
companies is market cap, right? Like that.
They all have different PE ratios, they all have different
price to book ratios. They all have different
financial structures. They all have different revenue
that all, you know, different products, like all this stuff is
completely different. So there's only one way you can,
you know, take a logical, you know, valuation metric in it and
it's really market cap. So and and once you're once
you're higher in market, cap those, those dollar flows that
are coming in the door is is exponential, not not linear.
Yeah. I'm just thinking like, does the
S&P 500 make sense based on what you just said, You know, like
does the ranking then make sense?
Because what does is it kind of like 8020, you would say like
adverse burrito? Is it like 80% of the S&P 500
flows go to the top 20% or like? Yeah, yeah, it's, it's something
like that. It it's really high, like of the
of the S&P 500. I think MAG 7 makes up like 35%.
No way. Yeah, 35% of the flows is MAG 7.
So it's like it's really heavily weighted towards the top.
And just to put it in perspective, right, like at the
S&P 500 index itself and all the index ETFs that follow the S&P
500 hold 6% of Apple. And like that's just that's just
one index, like bucket holds 6% of that company.
Now, if you take that bucket away, what's Apple worth?
Yeah. But this is what I mean like
this if if you, I mean, I don't want to take it too far, but
like the the Fiat, the Fiat game, you know, is not that
transparent in the sense like if if all the financial advisors in
the world, almost all I would say, right, They say like, well,
you should at least put some percentage in the S&P 500,
right? Like basically that's that's a
money funneling operation towards, you know, keeping these
mostly American companies by the way, up up there.
Yeah. So.
Yeah, and it's really curious when you look at the SP500I mean
those, the Max, it's something like 10% of the equities in the
S&P 500 generate 9597% of the return.
And so then the rest of the companies are just floating,
right? They're zombie companies just
kind of floating there and, you know, moving around and they've
got good credit quality because they're in the S&P 500.
They're getting passive flows because of the architecture of
the market. The S&P, the design of the S&P
500 has only been around like I don't know how long, but it's,
it's got a history, right? Like we're here today in 2025,
built upon this architecture of a financial world that was
designed, you know, 75 years ago and has evolved into where we
are today. And it it's inefficient based on
the new assets that are around today, the new design of like
the economy and how fast the the, the world's moving.
Yeah, I think that's a great way to think about it, right.
Like just think about, OK, there is this, there's this thing that
is Bitcoin and it just exists, right?
And I think, you know, you, you probably also come across a lot
of critics, right? People cannot handle the fact
that this thing just exists. You know, Jeff Booth talks about
it like it's a paradigm. It's a different thing.
And people look from their current paradigm, they look at
this new thing and they try to judge it with, you know, all
the, all the things or all the ingredients or all the
characteristics that they know from their current paradigm.
And therefore, it's just really hard to grok.
Like you really have to step out of it in order to, to see it.
And maybe to go back to the S&P 500 before we go further into
MicroStrategy, because this is one of the things I want things
I wanted to ask. So you're tracking
MicroStrategy. Of course, it is not in the S&P
500, right? But you're, you're, you're
tracking it as if it was right based on market cap, as you just
explained. Like that's the most logical way
to to track, I think, yeah, kind of like 2 questions into one
because I think there was a certain price of Bitcoin, like
9596 thousand dollars that should have been held at like
the end of March for micro strategy to have potential to,
to perhaps be included of obviously that that that price
wasn't reached. So yeah, what does that track of
micro strategy look like? And then maybe to add to that,
what is the position or the market cap where it would be
clear for you that it's kind of like off to the races I want to
say or like undeniable that this is the way to, you know, build a
corporate treasury? Yeah, OK.
Yeah. So 2 good questions.
S&P 500 inclusion, we're, we're thinking how this works strategy
has already hit all of the requirements to get included in
the S&P 500 with the exception of 1, which is positive earnings
at positive earnings of the last four quarters, some together.
That's the final, you know, box that they need to tech in order
to be, to be considered, to be considered for inclusion.
And there's a committee that, you know, goes through and
determines whether or not they get included or not.
And so the, with the adoption of fasby fair value accounting,
which will happen in Q1 here. So it'll happen at, at the end
of Q1 with the May earnings report.
We'll, we'll hear, you know, the, the new accounting
framework, which will be able to allow companies to mark the
Bitcoin to fair value at the end of the each quarter, which is
different than how it, it's been done in the past.
So this if there is a large gain or if there's any gain on the
balance sheet for the Bitcoin held during the period, there's
potential for Strategy to have significant accounting net
income earnings per share, which would then, you know, check that
last box that needs to be checked for them to be included
in the S&P 500. So, all right, last year
Strategy made $12 billion on their Bitcoin holdings, and you
know that the accounting wasn't adopted last year.
So if they would have adopted the accounting last year, I
think there's a high likelihood that they would have had
positive earnings, which could potentially get them included.
But they've kind of held off on the adoption of the accounting
for, you know, as long as they can, which is I think a
strategic move recognizing how all of these things move
together. Oh, you know, what would it
take? I think the price of Bitcoin is
to go up to $95,700 and at the end of Q2 now.
In order for their positive, for the earnings, for strategy to be
positive over the last four quarters, some together.
And at that point they would then, you know, be technically
qualified for the S&P 500. At that point, there's a
committee that needs to come together and say, hey, should
this company be included? And I suspect that there's going
to be a lot of things that they're not going to like about
strategy, They're not going to like the volatility.
They're not going to like Bitcoin, they're not going to
understand Bitcoin. And there's there's going to be
bewilderment, right? Like there's going to be a lot
of hatred, I think, because the market thinks they they should
be in and the committee may not think they should be in.
And I think that the game theory around this is really
interesting as well, because you think about who makes money on
the S&P 500. It's everybody that's offering
these index products, right? So it's, it's BlackRock, it's
Fidelity, it's Vanguard. And there's going to be pressure
from the the those companies to say, hey, I think you should
need to add strategy to the S&P 500.
You know, I saw that you excluded them based on your
committee meeting last last quarter and.
Maybe I should send less people to the S&P 500.
Yeah, right. Maybe I'll, maybe I'll shift
over to buying more of QQQ, maybe NASDAQ 100 instead of the
S&P 500 unless you include them. So there, there's going to be a
lot of gamesmanship and just just to be a family on the wall
and some of those conversations, I know they're, they're going to
happen. So it'll just, it'll be an
interesting, I think that will be one of the biggest stories in
2025 is this concept, which it looks like we're going to have
to wait another quarter at least to see what that what might play
out there. But it could be an incredibly
exciting thing to watch if, if Bitcoin goes back up to all time
highs around 108,000, you're looking at strategy having a $12
billion net earnings quarter, which, which would be massive,
right? The company was valued at 2
billion dollars 24 months ago. And like having an A single
quarter with $12 billion of earnings in a single quarter,
that's a huge accomplishment. So it, it will, it will be just
so fascinating to watch this stuff play out because you know,
the market is going to disagree on so many things, right?
Like is, is every one of those dollars of earnings from the
Bitcoin? Is that should that be treated
the same as earnings from NVIDIA or you know, Meta?
PE wise also. Yeah, right.
How do you value the company? It should be valued on a Bitcoin
standard, should be valued at a Fiat standard like and there's
just going to be so much push pull argument, right?
Like we're we're going to see that happen.
And I think that, you know, we're going to see a lot of
oscillation in the in the price of the of the stock moving
forward because of that. Yeah, I I love that.
You know what? What you just explained, I'm
thinking like this is the this is the clash of the 0 sum game
and the mutually beneficial game, right?
If BlackRock is going to advocate for, you know, S&P 500
inclusion of micro strategy because, you know it would
benefit them. That's the entire point.
And therefore benefit more of Bitcoin, you know, like that.
Yeah, that, that I love, you know, because you are, you're
forced to change your thinking basically once you're confronted
with Bitcoin, whether you like it or not, right?
So even if you're in the S&P 500, let's say the top 20 and
like 3 companies adopt Bitcoin and you hate it, you still have
to look at it. You know, that's why I love that
thought, right? Like you have to, you have to do
that. So you just mentioned also, you
know, micro strategy is is is is a Ponzi is a pyramid scheme.
Whatever people use and intertwine and mix, you know,
they, they usually don't really know the definitions.
Yeah. What what if I would ask you
like, what's the top three FOD or misunderstanding of micro
strategy? Like how would you disperse that
that FOD or just kind of explain what they are doing?
And one thing to add, because I also wrote down they borrow free
money. How does that work?
You know, I've seen people say that.
Yeah, yeah. I think, I think one of the
biggest things that most that the market misses is that, you
know, they say that strategy is going to fail, right?
Or they say like that this is this is going to be the next
FTX, right? This is going to be a blow up,
right? Like this whole thing is going
to blow up. They're they're they're super
over leveraged, right? Like we've seen the articles
come out. Anybody that says that hasn't
looked at the financial, so they don't like, they haven't looked
at the, the actual balance sheet of the company or the financial
strength, right? And so I, I've got some of the
numbers pulled up here just for reference, right.
Strategy holds $43 billion of assets.
So their Bitcoin as of today is worth 43 billion and the debt
that they have on the balance sheet is 8 to 8.2 billion, OK.
So there's a huge buffer, right? They've got effectively five
times as many assets as they do debt.
And so their, their leverage ratio is around 20%.
So when you, when you put that into perspective here, you're
like, OK, well, what, what are other companies leverage ratios?
You start to look at the rest of the market.
And you know, the rest of the market has seventy 8090%
leverage ratios. Like they just have, yeah,
right. They, they've got a lot of debt
relative to their assets. And that's, that's what I'm what
I mean when you, when you start to compare like some of the top
companies, the financial companies or even just companies
in the, in the mag 7, right? They, they've got pretty high
leverage ratios. They're, they're leveraged,
right? Like that's, that's how the Fiat
system works. You borrow money to take on a
project to, you know, make more money.
I would say you are incentivized to.
Incentivize to do it. It's tax efficient, right?
Like there's, there's so many, there's so many designs that it
makes sense to just take on debt and, and build, build a business
that way. And if you say assets, right, of
these other companies, that would be that could be real
estate or land like that, that that that is probably pretty
solid. But everything after that IP
machinery or computers, whatever.
Like, you know, I like this because if you go down, you
know, the steps and then compare that to Bitcoin and then Bitcoin
is superior to every other asset that the company can hold,
right? So yeah, how do you what's the
fair value for micro strategy if they have more a lot of the best
asset to hold in the world? Right, exactly, that's a good
question. All right, like that's what
everybody's trying to figure out.
And and the reason I bring up this leverage ratio, which is
important. You know, a lot of people are
really focused on this, this cost basis, right?
I think strategies cost basis for their 520,000 Bitcoin,
something like, I don't know, 67,069 thousand, I don't know,
something like that. And they, they think that if the
price of Bitcoin goes below that, like strategies going to
blow up, which is just the most false statement of all time,
right? Like the, if the price of the
Bitcoin goes down to just 69,000 or 67,000.
Oh, oh darn. They have $35 billion of assets
and $8 billion of debt. Right, like the point.
This is like. Oh, darn.
Right. Let's say it goes down to
50,000. OK, well, now you've got $27
billion of assets and $8 billion of debt.
Like the company still works, right?
These companies still actually incredibly financially strong.
Isn't the goal of leverage to, yeah, borrow money to actually
do something that is eventually worth more than what you
borrowed? I mean, this is a simple
financial mind here, but isn't that the whole goal as as long
as you have something that is worth more than what you owe or
basically in the green, let's call it in the in the green.
And even companies that are 90% leveraged, you know that stock
is still being bought. So yeah.
Yeah, right. It's a.
It's a weird argumentation. Yeah.
And and like just a number to put it in perspective, right?
Like first of all, of the debt that they hold on the balance
sheet, none of it is encumbered. That means none of it is
actually tied to the Bitcoin that they hold, right?
There's no margin call. It doesn't exist, right?
There are people yelling on the Internet, they're going to get
margin called, they're going to have to sell their Bitcoin.
It's like, no, that's just so, so wrong.
Like it couldn't, couldn't be more wrong.
And just to put it in perspective, the price of
Bitcoin would need to fall to like $16,500 for an extended
period of time before the assets are worth less than the debt
that they hold on the balance sheet.
So it's just, it's an astonishing number.
And you start to think about like, OK, how do you manage risk
here? Like what does that look like?
And, and that's, that's some of the stuff that the strategy team
is conceptualizing. The reason this works, right?
As I, as I mentioned earlier, right?
And thinking about how insurance companies can add these new
products with different risk return metrics to their balance
sheet, right? Like they, an insurance company
can hold strategy preferred stock, but they can't hold
Bitcoin. Now what strategy is doing is
they're using their bound, the position within their capital
stack as collateral. So that risk position within
their capital stack, they're using that as collateral to
design these products with different risk return metrics
for the market. So the convertible debt, for
example, in the event of a bankruptcy, the convertible
debt, the convertible bond holders get paid first and then
it's the preferred stockholders and then it's the convertible
preferred stockholders, then it's the common stockholder.
So you think about, OK, now I just monetized the collateral
position of my capital stack. And the reason this is the
reason this is like really valuable is because the products
that they're offering to these different tranches of risk,
right? They have, they have reduced
upside. So the upside is capped and that
they have reduced downside and the downside is capped, right?
You've reduced the risk, you've de risked this, this product
that they're offering to the market.
Now the benefit, right, like the common stock shareholder
benefits by taking on the excess volatility to the upside.
So you get to take on excess upside, but you also take on
excess downside. Now for most Bitcoiners, you're
like, Bitcoins going to be here forever.
It's not going to 0 like 0 is chopped off in my mind on
Bitcoin. So, so for me, it's like, yeah,
I want to take that excess volatility that these
bondholders or these insurance companies or pension funds can't
stomach because I believe in Bitcoin.
And that's, that's the, that's why they're increasing Bitcoin
per share into perpetuity. They're offering these reduced
volatility products to the market and that excess excess
upside and excess downside is getting delivered to the common
stock shareholder via Bitcoin yield.
Yeah. I kind of say, you know, Bitcoin
is a asymmetric opportunity based on publicly available
information. Would you say that MicroStrategy
is similar but in the Transfi world?
Yeah, absolutely. Absolutely.
I mean, I used to work in reinsurance and insurance.
I left three months ago and it was hilarious.
So I get, I would walk around and talk to some of these people
in London and Bermuda and New York, and I'd talk about Bitcoin
and I just get laughed at. Just get totally laughed at.
It's so fun. And meanwhile, meanwhile, I, my
response to getting laughed at is like, at the time, strategy
was holding $20 billion of Bitcoin.
And I would say like, look, this company is holding $20 billion
of Bitcoin, 20 times larger than than your company, you know, and
that that like made people pause a little bit and then they would
just keep laughing at me and go on.
It's like you're crazy and. I think this is field brain.
I mean, I experienced the same. It's because you when you work
in traffic by you're, you're playing around with money that's
not yours. Like there's zero agency, you
know, like there's no conceptualization of yeah, just
of the numbers. Like it's like in in my
experience, the people in Transfi work with money as if
it's not real, you know, you know, the real value basically.
But yeah, there's a certain mindset to that.
And and yeah, once you step out, I mean, I always walked into the
big bank in the business district in Amsterdam with my
Bitcoin button on my backpack and I walked in and.
I did the same. I had a little badge.
Yeah, I had a little bit good. Yeah.
I would go into meetings and people would be like, what is
that pin on your on your suit check And I was as a Bitcoin
pin. I love that, yeah.
What's Micro Strategy's end goal?
So how I've understood it, I checked that with, I think I
checked it with you, but also with Ben Workman before I
literally poured like everything that I still had liquid into
micro strategy. For me, it's it's, it's it's I
think the simplification is a portal from the old money to the
new money. They have basically opened the
door and are facilitating trad Fi with, let's call it custom
products for different type of buyers as you mentioned before.
And yeah, they're turning that dirty field money into pristine
Bitcoin collateral. And then it's rinse and repeat.
Yeah, my mind strategy is the bridge and the road to a fully
Bitcoin denominated future, right?
They, they are, they were going to be the largest financial
company in the world, right. If Bitcoin continues to go up
and we think that this network is capable of holding capacity,
like monetary capacity of the world, they're going to be the
largest company in the world. So a Bitcoin native bank.
Yeah, I, I think so. I mean, in, in terms of what
that exact future looks like, I mean, who knows, right?
Like we the, the, the world is moving so quickly and so fast
and evolving so quickly and so fast that it's, there are going
to be designs and products of things that we can't even
fathom. Five years from now we're going
to look back and say, wow, holy cow, five years from now, you
know, five years ago, we had no idea this, this existed.
I, I think some sort of financial operations absolutely
makes sense, whether that be offering lending products or
stable coins or insurance or, you know, different, different
types of products into the future.
But I, I, I think one of the biggest, one of the things I'm
most excited about is just the optionality, right?
It, it almost doesn't matter right now because they're
already leveraging the, the Bitcoin on the balance sheet to
make more Bitcoin, right, to buy more Bitcoin.
And that's something that a lot of people don't realize.
Everybody's like, what are they going to do in the future?
The future is now, like the future is already happening.
They're already leveraging, they're creating these new
financial products for the traditional financial world by
leveraging the collateral of the position of the capital stack.
People don't get that people, people don't get that right.
They, they're already using it like their Bitcoin is the
collateral. It's the best collateral on the
planet now. Now you have this unit, the
corporate balance sheet itself that sits around all the Bitcoin
is the transformer, right? The corporate balance sheet
transforms the the asset into a different tranche of risk that
has got different risk return metrics.
And that is already so interesting because they're only
edge. Only edge is Bitcoin, right?
So Bitcoin is already putting its stamp are, are planting its
flag like in in let's call it the, the finance world, right.
And yeah, like you said, I think the direction is towards
Bitcoin, you know, eventually. And I what I liked from what I
took away from 1 of Saders presentations was yeah, when we
bought Manhattan, we didn't know it was going to be, you know,
New York or when we bought, you know, what is it?
I don't I don't know that I'm not American, so I don't know
like the other things. But, you know, Louisiana, New
York is just that example. Like if you understand that
they're just like a pristine piece of land, you know, with
the ocean and the rivers and etcetera.
Like, OK, that's. And like the Dutch, you know,
I'm Dutch and the Dutch were really smart and they put it
like near this, you know, place in the water and they know
they're stuff like, yeah, that's what we need.
Like that's where we need to build, you know, a colony in the
city, etcetera. But how that's going to look
like, Yeah, no clue. But that bet was a great bet.
And I think that's how Sailor talks about it, right?
Like, OK, if this is the the capital of the future, if this
is the land of the future, like I need to plant my flag and be
in that land. And if people flock to that
land, then the opportunities will arise.
Yeah, yeah. And, and as I mean, just just
like what happened with me, right?
I mean, as, as the value of these assets continue to grow,
more people are going to, to use the term like, like escape the
matrix, right? Like more people are going to
exit and identify opportunities of how to continue to grow this
ecosystem. Because because I, I almost,
I'm, I'm indebted to it, right? I'm like indebted to the Bitcoin
ecosystem and, and indebted to, you know, growing and building
this thing because it will just continue to add more value to me
and my family and my friends like into, into the future, into
perpetuity. And I love the concept to write.
It's not a 0 sum game. We can all work together and
win, which in the Fiat world, it's I just, I got, it's such a
sick feeling when you, when you go to New York and you're like
talking to some of these people and like, it's just very clear
that it's like just kind of dirty, right?
Like they're just all trying to get an edge and they try to beat
somebody or steal somebody's business or do something like
that. And it's just incredibly
refreshing meeting and chatting with Bitcoiners about business
and finance and capital and what this stuff could be.
Yeah, I couldn't agree more. I think it was Jeff Booth that
said it's cooperative competitiveness.
And I really, like I said mutually beneficial, but he said
cooperative competitiveness. Yeah, that's it.
You know, you go from zero sum, you go to that.
So even if we don't really know where micro strategy is going, I
mean, like, yeah. So in my mind it's yeah, I call
it like Bitcoin native bank, like yeah, yeah, like you said,
there could be strategy coin, you know, like a stable coin
properly backed by by Bitcoin, for example.
It could be anything. But what do you mean this?
What do you think this means for for banks, insurers, etcetera?
Like think what we talked about is like there's an imperative to
move. You see more and more banks, by
the way, also talking about, you know, with the repeal of the Seb
121, you know, they can offer these custody services,
etcetera. They're, they're going to move
into it, you know, because there are many there, there's many
research that also already shows, you know, millennials,
Gen. Z are way more into crypto,
Bitcoin, etcetera. Like this is the new world.
They have to move towards that. But the insurer that I worked
at, we always called, so I worked in the innovation
department. They always talked about like
burning platform. I'd like they know that I don't
know, there's like 30,000 fintech startups in the world
and they all. Pick.
Like a little piece of of a big financial corporation, but then
they do that better, right? Like home, just home insurance
or you know, stuff, stuff like that.
These these big track five companies are basically already
all unbundled and they see that it's happening, but the premiums
that they collected will last them for, you know, probably
like 20 more years if they just keep it as a cash cow.
Basically. My question is more what what do
you think will happen in that space?
Do you think Bitcoin will be the big, let's call it the unbundler
or maybe the the, the Yeah, yeah.
I don't know how it's even called it.
I wanted to say like the bomb. That's not what I mean, but
like, yeah. Yeah, I think we're approaching
an adapter die scenario for like the, the larger, the larger part
of the financial services industry, right?
And it's going to happen over time.
It's going to take so much time. Again, I think a lot of people
underestimate how, how like how much time it takes for a large
capital to move and, and really understand what, what's going,
what's going on. So, you know, I, I don't think
it's this year, I don't think it's next year.
I, I think within the next 4 years, though, 4 to 8 years,
we're in this adapt or die scenario where companies are
really going to have to rethink their business model.
If if you've got other companies like, you know, like strategy,
just eating their lunch, whether it's, you know, offering a
lending product or a new, you know, it can evolve, it can
evolve very quickly. I think there could be some
decoupling, right? If the companies that do adapt
here are, are going to continue to win.
If if they are truly, you know, buying this asset to hold for a
long term and and adjusting their business model to
accommodate it. Yeah, you mentioned before.
Well, basically I wanted to ask you why or when will the
bewilderment intensify? You mentioned before, you know,
you think it's going to 100 billion, two, 34500 billion, I
heard you say 1 trillion before. Like when will it be apparent
that this is undeniable? Yeah, I, I what I, what I think
can happen is right. Like strategy could go to 200
billion, five, 100 billion or a trillion and the market's going
to freak out, right? Like the, the whole market's
going to just totally freak out. What's going on?
What is this company Bitcoins of Ponzi, all the narratives that
we've already heard like 6 times in the in the last few run ups
and blow off tops, right? Like March and November, same
thing's going to happen again. It's just going to be on a
larger scale and then everybody's going to short it.
It's going to go back down. And you know, strategy is going
to have raised a ton of capital in the meantime, bought a ton
more Bitcoin. They're going to go down and
it's going to go from, you know, $750 billion market cap down to
a $250 billion market cap. And then everybody's going to
get bullish again and it's going to go right back up.
And then so I, I think you know, where, where people really start
to recognize this is like a sustained, A sustained $1
trillion market cap. Like with the, with the bottom
being a trillion dollars, like all of a sudden you have to take
it seriously like this. This company is if they go up to
2 trillion and come back down to 1, that's like that.
That company's going to stay here and that's going to be
around for a while. What's your timeline for that?
Like do I buy calls? No, no, I just.
Model. Yeah, it's, I think it, I mean,
I got. To be like overly bullish, but
more like what's just objectively or just realistic?
Not realistically, but just like rationally.
Like what? Yeah, like I, I right, we're
2025. Four years from now it's 2029
and eight years from now it's 2033, right.
Like honestly, the 2032 horizon I think is, you know, when we
get to this 1% of Bitcoin left behind over the next 100 years,
that's like that's, I want to, I don't want to say the end of the
gold rush, but like it's saturated, right?
Like it, it should be saturated by a point.
And the eight years of working in this stuff, now we're going
to see just, it's going to be fireworks, dude.
The next eight years are going to be just all sorts of just
crazy news and this stuff like it's going to be a lot of fun.
Yeah, I love it. Yeah, I got this question from X
and I'm going to ask our friends Richard Byworth the same.
But now that I'm talking to you, I thought this is this is a fun
question for you too. Yeah.
You are the CEO of Strategy for a week or a month or what's your
next move? What's your first next move?
That's a really good question. I would I would start a
Bermedian based reinsurance entity and start attacking the
insurance market. That's what I would do.
Like that. I know Richard's answer already,
but I'll, I'll let you know later on, yeah.
Yeah, look forward to seeing it. Yeah, Yeah, I would, I would be.
Well, I've, I'm obviously biased because I've got an insurance
background, but the, the, the insurance industry, I think is
ripe for innovation and just to get eaten by this industry
completely, Yeah. Yeah, I agree because.
Because there's these lids on innovation and by from
regulation and rating agencies and stuff.
It's just like if you start, if you find a way in or which I I
know of a few ways in and so does Ross Stevens at Stone
Ridge. But once like there's just a
huge Moat like you can, you can just start eating the industry
without the industry having any ability to fight back because of
the regulation and the rating agency involvement.
So that's an interesting space. Maybe you should start that
company. Yeah, it's all right.
It's a thought. So just like we're memeing
Bitcoin into existence, you know, decentralized retail
investing communities are becoming imperative for success
in a modern day, as we've seen with, you know, you guys teaming
up talking about MicroStrategy. I don't know how big the
irresponsibly long MSTR group is now, but 10s of thousands of
people. I think now you're joining Seder
on stage at the, you know, their event strategy world.
Yeah. How do you see the future of
investing or like these communities evolve?
I mean, this this is really showing the power of the
Internet, I think. Yeah.
Is this kind of like the new school of investing you think?
Yeah, absolutely. I, I think this is the way
investing is, is trending, right?
GameStop really kind of kicked the door open on taking down
Tradfi, right? Tackling Tradfi.
And this is, this is the new evolution, right?
Where you've got this new product, new innovation,
companies adopting Bitcoin, The Wall Street Journal isn't
covering this, right. Like Nope, nobody's exactly
right. Like I'm not grabbing my coffee
and a Wall Street Journal and sitting down in my cafe looking
at what strategies doing like it's just not happening.
The world doesn't move like that anymore.
And like last night I talked about it in our live stream,
right. Like everybody knows if like
Jerome Powell picks his nose, like is that is that dovish or
bullish or bearish, right? Like so you know, everybody's in
this hyper speed trajectory. You've got bots that are moving
at the speed of light and just fast as shit.
So but I think that the decentralized nature of people
that are following stocks and and communities building around
that is the way this just continues to move.
I think it's completely inevitable and we've seen it
with Palantir, we've seen it with gap lovin, we've seen it
with NVIDIA, honestly, Tesla and and even even Amazon, like when,
when Amazon first came out, like you've got these communities of
people that know what's going on, but the, the Internet has
made that more accessible and, and the, the, the cream rises to
the top, right? Like the people that are talking
about the stuff that know what they're talking about and care
and put our time and energy into it.
They're, they kind of like elevate into these leadership
roles, which is what I've really kind of found myself in.
And it was one of these like, Oh my God, I have to do something
with this or like, this is just going to fall apart.
It's like, I just felt this and this need to create something
because this movement is larger than me, right?
This is this thing is this is way larger than me.
And if there's a if there's a group of cohesive people that
have a calm head and understand the trajectory and the long term
nature of this, like this equity and this trade like that,
there's a ton of value in that. Whereas, you know, some of the
challenges that I think GameStop had is like roaring Kitty was
out here is like one guy, like posting his screenshots of like,
I made $200 billion. And then like everybody relied
on that one guy. There's a ton of pressure on one
person, right? Ton of pressure.
And now we're in this new scenario.
It's like, OK, well, now let's let's think about a group and a
group where everybody's got a role or everybody's working on
different things. Everybody's operating
efficiently and providing info and alpha to the environment of,
you know, what's going on here because it's a complicated
equity, right? It's like, that's why we're
talking, right? No, nobody, like a lot of people
don't get it. So, you know, my, my role is to
talk to people about it and continue to, you know, spread
the word, I guess. I think I love that because
it's, it's, I think it's similar with with Bitcoin in general.
I mean, I experienced it with, with doing a podcast like this.
It's and, and, and for micro strategy, for example, you, you
guys have helped me a lot to get insights and, and learning along
the way, right. But it's, it's, I, I think
that's where the edge really is. Like that's where you, you, you,
you, the opportunity is only apparent if you kind of like
look at it. That sounds very simplistic,
right? But it's more like, yeah, if I
think I got like MicroStrategy built in three days and like 4
videos and then seeing discussions and I'm like, yeah,
OK, these guys know what they're talking about.
And I knew that already because it was the same with Bitcoin,
right? Like if I look at someone who
has like 35 years in the risk chair, Greg Falls, and he said
he, he gives me a rational explanation of Bitcoin.
I'm like, yeah, what the fuck do I know?
You know, like, OK, this guy just explained it to me and I'm
totally following along. Like, OK, this is it like just,
yeah, you know, like that. And so I I love that.
And that's also still why I love Twitter X in that sense.
Like you can find people like yourself, like like Ben Workman
just yeah, like I said, you know, before we started talking
like we're just nerds, nerd in and just sharing that on the
Internet and anyone can pick that up, you know, and then you
can do your own due diligence and, and and, you know, take
your own action on that. But yeah, that's a super
accessible now. All right, I want to ask you my
last question because I I ask everyone the same question at
the end, which is what is a core belief that you will never let
go of. That is a good question man.
I should have prepared for this one as a core.
Belief. That's why I don't send it to
you. What is core belief that I'll
never let go of, man, honestly. Stay true to your, true to your
heart. Like listen.
Listen to your listen to your gut and keep keep the people
around you, right. So one of the things that I
continuously live by that you were the you're the average of
the five people that you spend the most time around.
Like I, I always strive to spend my time around some of the, you
know, brightest people that make me a better person and make me
positive and, and happy to happy to live.
So. And for me, it's like my wife,
my dogs and my friends that I've made in this community and some
of my close friends from college.
So yeah, I think. That's it man.
Thanks for sharing and thanks for this insightful
conversation, man Happy, happy we connected and happy to do it
again. Thank you.
Absolutely looking forward to it.
Thanks for having me on. I appreciate it.
We, we've got a show, MSTR True North happens every Wednesday.
Also have a podcast called the Hurdle Rate podcast that I'm
running with Ben Workman, Tim Kotzman and Strive CEO Matt
Cole. And we've got a lot of exciting
things in the horizon that I know that the MSTR True North
community is, is building a lot of things at the moment.
So a lot of things going to pop out here the next six months.
So stay tuned, follow along and yeah, excited, glad, glad I got
a chance to talk on here and yeah, look forward to the
future. Also man, I'm linking to
everything in the description of course so people can check it
out. Cheers.
Thank you.
Thanks. See ya.
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