B (3:29)

I mean, those are the markets. Gold, on the other hand, gold is getting absolutely pooped. The bed gold back down to. I believe it's like October prices before that was like right before the people started lining up for gold leading into Thanksgiving. But gold back, yeah, it's back at

C (3:47)

prices we last saw in October. And just for context on this, it sold off pretty brutally in early hours this morning. And this follows a 10% decline last week. Now, that is nuclear for an asset like gold. And it touched $4,100 an ounce and it sprung back up to almost 4,500. But, you know, precious metals are starting to trade like shitcoins. And this is something we've talked about a little bit on the show. There's been so much volatility that, you know, you're seeing things like silver have these wild swings too. I mean, silver looks even worse. It's down 22% over the last month. Sure, there are some bitcoin and crypto diehards that are just relishing this because if you were on Fintwit or plugged into financial circles at the end of last year, everyone doing laps around bitcoin and crypto investors because the boomer rocks ended up outperforming bitcoin along with everything else. But right now, they're counter trading everything else.

B (4:52)

You say precious metals are trading like shitcoins. And it's ironic because some shitcoins are trading like precious metals in that they're flat because they can't go down anymore. But also, bitcoin's done pretty well. Is this one of the first times we've seen bitcoin go up and gold go down? Because maybe we can get an actual decoupling in recent memory because basically Gold's had all of the attention on it as of late.

C (5:19)

Yeah, I mean, I'm sure we could go back and look at scenarios in which they are inversely correlated with each other. That being said, a lot of the traditional breakdowns, traditional correlations are kind of breaking down with a lot of these different asset classes.

B (5:34)

Yeah. A fun little chart I want to show. This is an infographic, I believe Iran over the weekend, you know, started puffing up their chest and saying we can shoot missiles. And they released like a list of targets. You know, do you see that? And the, and so some people did the whole thing where you like, you know, draw a circle around the map to see how far the country can shoot their missiles. And here you are, here's like the, you know, the big circle, the high level thing. And you can see if you're in northern Sweden or Norway, you're just out. The western side of Denmark is safe, whereas the eastern side of Denmark is, is supposedly vulnerable. Luxembourg, just between France and Germany, surprisingly just barely out of range of Iran.

C (6:17)

It's like most of most of Europe, which is really interesting. But yeah, like you said, Charlie, this is all anyone can really talk about right now. And for our lead story today, before we get to, before we get Ryan up on the stage, I want to flag this that we just posted on block space Federal Reserve quote, hawkishness, end quote. Not Iran to blame for weaker Bitcoin ETF inflows. Says CoinShares. Says Coinshares analyst James Butterfill claiming that outflows last week stemmed from the US Reserve newly hawkish stance and which was largely interpreted as a hawkish pause by investors and not investor fear on the current conflict between Israel, Iran and US. This is kind of like, you know, not to throw shade on James here. I get what he's saying, but to me it's almost like splitting hairs because I would say that the renewed hawkishness of the Fed is largely driven by inflation fears from the war in Iran because oil prices have absolutely surged. And I've got some charts to throw up for this. So let's just look at crude first. And to recap, the Fed met last week. FOMP said no more, no rate cuts today. And they Also it's the CME Fed watch tool is now pricing in zero rate cuts for the entirety of 2026. Now that is a big revision from the end of last year where market participants were expecting maybe three, roughly around three throughout the course of the year. But now the Fed is signaling, you know, we're probably not going to cut at all. In fact, some people are actually worried that they might raise throughout the year. But just to give you an idea of why, markets are kind of in turmoil, for those of you who haven't been watching these charts like hawks, this is when the Iran war broke out the end of February. Oil has just absolutely surged since following the close of the Strait of Hormuz. This is WTI crude. So this is the West Texas index. This is what we use to track oil in the US and it tapped 100 on the daily believe. It got up to as much as 120 on Monday of one of these weeks in mid March before sharply correcting afterwards. And then if we look at Brent, Brent's having it worse. This benchmark for crude oil and particularly the European market, obviously they don't produce very much oil. There's a little bit of a premium. We have the luxury in the US of consuming and producing and consuming locally. So little bit less of a shock to oil prices from where we're coming from. But it's the same picture. It's just up and to the right now. As a result, this has spiked inflation fears. And if we want to look at where this is showing up, it's showing up in the bond market most of all. And this is from Adam Cobiesi terminal, if anyone wants to sponsor us for one. Really, Bloomberg? Give us a terminal please. In a sudden turn of events, Adam post here. US 12 month inflation expectations have surged to 5.2%, the highest level since March 2023. In just three weeks, markets have gone from pricing and rate cuts to rate hikes. What this is, this, this index right here basically looks at one year forward looking inflation expectations. So what this chart is saying is that traders are pricing in the likelihood of 5.2% average inflation over the next 12 months. It's a big jump from where we are. Inflation has also been rising a little bit. If we look at some of the benchmark surveys that the Fed looks at. So in February, CPI headline was 0.3% month over month. Not crazy, 2.4% year over year. But if you look at PPI, that's producer price inflation. So for manufacturers, producers, things like that headline, PPI in February was 0.7% month over month, which was much hotter than expected and 3.4% year over year. So inflation is starting to rear its head again. People are worried it's going to get worse because of oil prices being elevated as A result of this war. And the last charts that I will pop up here before I shut up. If we look at the bond market, I'm going to actually pull up this first. This is really where you're seeing these inflation expectations rear their head. This is the 30 year after the start of the war. Between the start of the war and now. You've seen it move by 30bps, which is a pretty aggressive move over the last month. You can look at the 2 year, 5, year, 10 year, all of them are moving up as a result. So this is the Fed's worst nightmare or this is the treasury rather worst nightmare right now. And I guess the Fed, because they're all kind of acting in concert. The interest rate on the long tail of these bonds is going up at a time when the Federal Reserve or the US Government really wants to drive these rates down. We have 35 trillion in debt. We're starting to spend way too much of tax receipts on interest payments on that debt and that as well. This was tipped off of this chart courtesy of Jeff Park. Is this going to fit? There we go. This is the move index. This is basically like the VIX for the bond market. The VIX is a volatility index that looks at the wider market and looks at, you know, how volatile things are and gives a reading for volatility in real time. Well, the move has just been blown out since the war kicked off. This is the five day, if we look at the month it looks like all these other charts up into the right and we're above 100. Between like 100 and 120 on this reading is when things start to get, you know, people are getting skittish. We go above 120. That's extreme volatility stuff that we saw in the COVID crash during the, during the Great Recession in 2007, 2008 et cetera. So a little market update on that and this all has, you know, the reason we bring this up as it relates to Bitcoin is because if you look back particularly at like at yields on, on U.S. treasuries, the last time U.S. treasuries really had a sharp move up that's comparable to what we have now was 2022 when the Fed started hiking again. The entire market was thrown into a tizzy as a result. Equities were down, Bitcoin was down that year. And you're starting to see rates move up pretty aggressively again. And so depending on where the liquidity is actually flowing, it doesn't bode super well for bitcoin. But yeah, I just, I wanted to take a moment to address that comment from the Coinshares team because I get where they're coming from in the sense of like, it really is the Fed driving the ship right now, but the Fed is reacting largely to what's going on in Iran and I think that's important context.

B (12:38)

Cool. Well, we're going to bring up Ryan here in a second, but yeah, bitcoin up, gold down. Bonds, Bond market in Cambridge.

C (12:48)

Well, bonds plummeting and yields ripping.

B (12:50)

Yeah. So trade accordingly. Not financial advice, but as it pertains to other types of money, we've got our boy, Ryan Gentry. Welcome back to Blockspace, Ryan. How are you doing?

A (13:02)

I'm living the dream. Although this morning was bizarre because I checked prices and was depressed and then I got a notification on my phone that all of a sudden bitcoin is back over 70k because of the Trump tweet. Checked again, was like, what happened? So I don't know. I've been discombobulated since like, moment one this morning.

C (13:20)

We're all discombobulated, man. Every, you know, it's, I, I, this is the year for me of the schizophrenic market reactions where everyone, every day, it seems like, is going, it's so over. And then we're so back by the end of the day or the morning.

A (13:35)

Within. Within hours. Yeah, this was, this was the fastest I've experienced. It was like woke up and I was like, still poor.

B (13:43)

It's over.

A (13:44)

And then was like, oh my God, we're so back, like within the next 15 minutes.

B (13:48)

Well, you just don't own the right assets. You need to own whatever the opposite of gold was the past couple months.

C (13:53)

And then bonds, any market accounts.

B (13:57)

Yeah. So we brought you on because you CEO of Bitcoin Infrastructure Corp, but you've really kind of blown up over the past couple weeks as you've been tweeting about a thing which has really also captured the interest of Twitter here, which is payments, particularly machine payments. And you built a website, 402 Index IO. Just to explain what that is, I think maybe I would invite you to do a little recap. You did a history on machine payments protocols thread a while ago. Can you reprise that for the audience here?

A (14:32)

Yeah, sure. For those who don't know, HTTP is the protocol that underpins all of the web. Right. And so I'm certain that 99% of your listeners at some point have seen an HTTP 402 error code which Means that like the website they were trying to visit is down. So there's a little known error code that was included all the way back in the, in the mid-90s, HTTP 402 payment required. That's been in there forever. Just waiting on Internet digital currency in an Internet native payment network to leverage for that error code. So I got into crypto broadly in 2017 because I was working on Internet of things type stuff at intel. So that was kind of like my entry point. I was not like Austrian economics or any other reason for that. I just thought machine to machine payments were cool. So it turns out that all of a sudden now like with these agents, it seems like machine to machine payments might really be having a moment. So I kind of have nerd sniped myself into getting back into this and tracking this. But the history to your point is. So, you know, I got into crypto generally. I was working with multicoin for a couple of years, like looking, learning about all these protocols and then I went to the very first lightning conference in 2019, the, you know, the ln Conf in Berlin, which is still the best conference I think I've ever been to. You know, this year's coming up next aside of course, but in, at that conference, Roast Beef, the Lighting Labs CTO who I worked with for the last five years, very closely, he presented the protocol that is now known as 402 or L402, saying that hey, we have a solution to this Internet native HTTP code. We have a solution where you can put up a paywall on a specific resource, on a specific API and force somebody before they access the resource to pay you over Lightning. And I thought that was amazing. I still think it's amazing. It is amazing. It's just a really cool thing and it's kind of a niche thing for you know, everyday non developers. But developers who are used to having to put up rate limits and having to deal with all sorts of nonsense because they can't just sybil resist native to the Internet, they don't have a way to stop somebody to pay them before they request a resource. They get it immediately like oh, a paid endpoint would be amazing. So Roast Beef, you know, came up with that idea in 2019 I believe like the first like release of actual working software was either end of 2019, early 2020. It was obviously lightning and bitcoin specific. Then in 2025 Coinbase came up with kind of their own version called X402 which works on base and on like EVM. Chains generally. It, you know, lightning L402 is peer to peer. It's locally verifiable. It has all the usual bitcoin principles, you know, totally decentralized, all this sort of stuff. The X402 version of course has like a centralized facilitator run by Coinbase right in the middle. Although, you know, also there are other facilitators that exist now in the ecosystem. So it's like decentralizing according to market conditions. And then most recently like last Wednesday, Stripe and their new blockchain Tempo, they released their own standard mpp. And so that had Lightning included from day one as a first class citizen of the protocol, which is great. And so like, you know, for five years from 2020 to 2025, you know, kind of working to help grow this L402 community. You know, having Stripe come in and work on this is great. And they have tons of distribution right there have tons of Internet native merchants. It's great that Lightning is included from day one. Lightning Labs actually on Friday also released an update to their own software, adding mpp, I think. And I Already had this 402 index website built that I was really just using for kind of my own. I was just curious how things were growing and to be able to track it. It was kind of like my first little vibe coding foray. And so I was like, well crap, I can add MPP support and be the first website on the Internet to support this thing.

C (18:39)

I should ship it.

A (18:40)

And so I shipped it and it seems like people liked it. I have the pending approval from the Council of the Crypto Balds. I got retweets from Jeremy Allaire and a nice comment from Brian Armstrong. So I got very important crypto bald CEOs approval so far and I'm working on the rest very hard.

B (18:57)

Yeah, you've got the blessing of the Balds for this project. So like the real kind of the real crossing of streams here lately in these like payment protocols has been talking about machine payments less so it seems to me like humans initiating these payments, like, I don't know, is does that change how we think about these protocols? You know, explain to me like why people are so excited about machine payments in general.

A (19:30)

I think it's mostly that the idea has been that, you know, who is a natural user of crypto for payments. Like really, you know, like here in the west and I have a couple of different answers to this. But like here in the US we have Venmo, right? Like we have Cash app, like I Don't. Candidly, I don't have really many problems with payments on a day to day basis, right. Apple Pay works great. Tap to Pay is a good experience. Like, you know, I think a lot of the early people that were excited about payments and crypto were specifically mad at PayPal for like arbitrary censorship reasons and they wanted like an uncensorable payment network. And that's, you know, I totally see the value in that for human rights purposes and stuff like that. But it's not like a real pain that like modern people living in the US with smartphones really encounter on a day to day basis, right? Working at lighting labs. Like people who have a lot of pain with the existing payment networks are people, emerging markets, right? People in Latin America and Sub Saharan Africa and Southeast Asia. Like those networks are a lot, they don't really have the benefits that we do. And so like a first class, world class payments network, like Lightning Network really makes a lot of sense for them. But then kind of in thinking about, okay, who else is like not a, is the, is the existing payments system that we have not well designed for. The idea has always been machines. And the machines would be much, it would be much easier for them to just like spin up a private key and start sending payments without permission than like having a bank try and get a bank account for an AI agent, right? And so that's kind of always been the reason why people are excited. And the other thing is it's just, it's just fun. It's cool. Like I, I think it's cool and fun to give, you know, Claude code a $5 budget and have it like go pay send sats across the Internet and go pay for Internet, you know, any sort of resource, right? Pay for LLM, compute, pay for some data, you know, pay for an analysis. And the other part of this that has been cool and nostalgic for me and has reminded me I did the whole mid curve thing and bought myself a Mac Mini. It reminds me of like the early, early days of lightning when I had a CASA node and I was really excited about like the home server revolution of people, you know, having a home server. And so, you know, one thing that would be cool if you're running a home server that costs, you know, whatever 800 bucks or something like that is like being able to claw back a bit of that expense by, you know, monetizing some work that you have locally. And so whether it's like you're running a local hosted GPU and LLM and you don't use it 24 7. But you think people on the Internet might want to use it? Like, I think that's a really interesting use case. You know, it's still like really early to this stuff, but, you know, people are doing a lot of selling data. People are trying to, you know, sell Oracle information. Like, there's all sorts of stuff that people are trying. And I think it's just a fun blank canvas to experiment on. These tools are mature, the networks are finally mature to be able to support this. And there's a lot of energy and excitement behind it, especially because, you know, everybody is pivoting to AI right now. And so I guess in a sense I'm a little bit guilty of that. But, you know, at least I'm still sticking with Bitcoin payments and Lightning as a core part of it.

B (22:42)

As you said, it would be interesting to claw back some of the money you accidentally blew on that Mac Mini. Exactly. Okay, okay. So there's all these payment standards. You say it kind of kicked off with L402, the Lightning 1, then X402, Coinbase's 1 MPP, which I guess is striped tempos and maybe a little bit of light spark, you know, spice in there. Are any, like, is one of these differentiated that much? Are they all differentiated? Is this a winner take all proto like payment protocol landscape? Like, how should listeners think about these different standards over the coming years?

A (23:18)

I'm honestly, I don't think anybody knows. I think the answer pre AI agents, pre vibe coding, the answer would have been like, it's all a network effects game. It's a winner take all market. Whoever, you know, whoever gets the highest value service providers to start, you know, demanding a certain type of protocol for payment. Like everybody's going to comply to that. I, I really don't know anymore. I think, you know, it's. It could very well be possible that because software is now so cheap to generate and so cheap to generate, you know, compliant with the spec that, you know, there are multiple protocols that win and they don't have to all be aligned. It could be very possible that the one that is, you know, supports the broadest distribution of options is the one that wins. I honestly, like, I don't think anybody knows and I'm just kind of along for the, the ride tracking it at the moment. I think, like, what I know currently and what I tweeted in kind of my original thread that was just interesting is that, you know, Lightning has L402, has kind of the highest signal to noise ratio Right now and that like of the providers that are set up, the highest percentage are, you know, configured properly. Although it is, you know like base has the biggest ecosystem. They have something like 15,000 endpoints, but you know, the vast majority are don't even work. Which you know, kind of checks out the crypto community and then MPP is like obviously brand new but you know they have this stripe, they have OpenAI and anthropic endpoints on there. Like they have some really big names. So I think kind of like breaking it down by that distribution is interesting. You know, anybody doing payments on the Internet, it's going to be really tough to compete with stripe. Which is why, you know, I'm really glad that Lightning is included as a first class citizen right off the bat for them. But you know, it's new. They have a new blockchain that they're using too, which is very hard to, you know, it's very hard to get a new blockchain to get users. In the early days it's like also kind of like a corporate chain. I think there's only like a couple of nodes backing it anyways. So you know, we'll see. I think it's, it's a very interesting, exciting time and I don't think anybody knows how it's all going to end up which is why it's one of the fun places to be playing in right now.

B (25:39)

Yeah.

C (25:39)

So Ryan, I know you got to get, get going. So kind of a lightning question, pun intended. 100. When I look at these AI agent payments and I think about the trajectory of lightning up until this point and I think about stable coins. In conversation with that I, I had to ask myself unfortunately a black pilled question which is why wouldn't we just be using Stables for these agent payments? Can you give us the bull case for Bitcoin versus Stables and then maybe the bear case for why stables have an edge, kind of just taking both sides of it.

A (26:08)

Well, I think the, the bull case really is that it's Stables running on Lightning. That's what I actually think is going to happen here. I think that certainly again like, you know, like I, a ton of people in the L402 space have submitted their endpoints to the 402 index with a price in SATS and I just display them in a price in USD and just like every time I do you render the webpage I just auto convert it. That's now like easy enough. And if all that stuff is done by an agent like you know, I think it's, it's pretty easy to automate if you want to receive Bitcoin. You know, you can quote in dollars and still receive bitcoin under the hood and that can still happen. But I certainly think that, you know, a lot of service providers, especially if you're paying for your server in dollars, you kind of are going to want to be receiving the money that you're going to use to pay for that server also in dollars. Right. Just so you don't incur slippage and that, you know, it's, it's, you don't have to deal with volatility and stuff like that. So, you know, I think we'll see both. I think it also just really depends on what service do agents actually want to pay for, which is really the big question. Right. There's a ton of people that are putting this stuff up. I think Artemis had a really good article the other day that like there was this headline number that X402 is doing like 24 million bucks a month in volume. But then they deduped everything and took out all the wash trading and blah blah, blah, blah and they got down to like, well, there's probably actually like $1.6 million a month, which is not nothing, but it's like, you know, that's a 10x smaller. So I think people are still trying to figure out what's worthwhile, what's worth doing, what do people care about? And if the use case, if the service provider that catches fire is demanding bitcoin payments, then by golly, his customers are going to be paying him a bitcoin. Sounds awesome.

B (27:56)

Ryan, you got any more vibe coding projects on the horizon I should watch out for? Or are you now in maintenance mode for an accident? Viral?

A (28:06)

Yeah, my goal, I was hoping to be in maintenance mode. I'm actually more in like, oh crap, things are breaking and I have to fix the mode. But my goal is to turn this very tightly scoped little personal project and I would like to end, to end automate the whole thing so you're getting included in the registry already. You have to pass a health check and prove that your endpoint is properly configured and has good uptime. Once you get in there, you can verify your domain which allows you to then edit the listing securely that you have to prove you own the domain before you can do any edits. So I don't have to manually edit. I'm continually health checking these endpoints to make sure they're up and have a couple more ideas to improve the verification of that. But what I would like to do is to have this, you know, be end to end automated, including kind of like the sales and marketing. I thought that seemed like a cool fun project to do with all this new agentic tools that exist. So we'll see how far I get with that. I definitely still have some more work to do and did not expect it to get this popular this fast. But it's been fun and I think, you know, the community building around it is having a good time and we'll see where it goes.

B (29:17)

Thank you Ryan, CEO of Bitcoin Infrastructure Group and vibe coder behind 402 Index IO Ryan, we'll catch you later. Thanks for coming on the show.

A (29:26)

All right, thanks.

C (29:28)

I love the idea of it depends on what the AI agent is doing. Of course. My mind immediately went to ah yes, for fulfilling my Amazon purchases you'll use stables but when I need to up MDMA from the dark web that's when we start using Bitcoin on Lightning and Monero. Yeah, just kidding, just kidding. Allegedly that doesn't happen.

B (29:49)

We got, we got more stories. We've got, we've got crypto layoffs, we got marathon AI. But before that a word from our sponsor, CleanSpark.

C (29:57)

We are CleanSpark, America's Bitcoin miner, a publicly traded company with the largest operating hash rate powered entirely by self operated

A (30:08)

infrastructure structure across four states.

C (30:13)

This is our proof of work. We are setting the standard for what's next. Learn more about the intersection of energy and bitcoin@cleanspark.com agentic payments actually really good segue into our next story which is that AI is coming for all of your jobs, including those of you in crypto who thought you would be safe because you bought into a generational Ponzi scheme. Crypto firms cut hundreds of jobs in weeks blaming weak market, strong AI CoinDesk. This is an article that Coindesk put out today this morning at 6:42am and the layoffs are starting to stack up now. It's still pretty mild compared to the last bear market and we'll get into those numbers in a second. But adding to Block which laid off 40% of its workforce a few weeks ago, some 4,000 employees and hired a few of them back. By the way, we have Algorand, Gemini, Crypto.com, oP Labs, PIP Labs and Masari who have all cut staff in recent weeks. Special shout out to Messari. Wonder if this if someone at Coindesk has an axe to grind against Missouri. Sorry has now laid off staff three times since 2023, shrinking from a target of a thousand analysts to roughly 140 employees today. Yes, pretty rough. And then we'll just go over a few of the numbers here, rifle through the casualty list really quickly. Algorand, which I don't even know how some of these, you know, altcoin companies are still around at this point in 2026. But anyway, Algorand fired 25% of less than 200 staff. Gemini has fired 200 staff, roughly 25% of their workforce, which is pretty crazy. And let's see, crypto.com firing 180, about 12%. And block axing, as we said, 40%, roughly 4,000 people. Messari did not give a number for how many people they laid off. Now some, some backward looking stats to contextualize this. So if we look at the 2022 job market, according to data, 26,000 jobs over 2022, a tally that took months to become apparent. Coindesk says here, of course right now the numbers that they have from the most recent batch is 450. From the new ones, if we add Block onto that, it's almost 4,500. So pretty sizable chunk. Of course, Block is not only a crypto company, there's a caveat there. They also operate the square point of sale terminal. They operate Cash app which does have a bitcoin buying option. You can also buy stocks and money on it. So it's kind of a neo bank, neo financial services platform. But regardless, some of those people were definitely involved in crypto initiatives. So there's some overlap there. It's hard to say how much should actually be included in the crypto job total though for that from what we know. But all of these companies basically cited weak market conditions and AI for these job cuts, saying we're trying to get ahead of the ball here. If we can use AI tools to automate the job of two or three people, we're going to do that. And that was the same thing Jack Dorsey said during the block layoffs.

B (33:41)

Yeah, it's interesting because we haven't, as far as I can tell, we haven't seen this, this type of layoff trend hit tech broadly yet. It's four appears to be like a hiring freeze. So in like all tight, in all, like in all things like crypto, we tend to be a harbinger of maybe what's to come. I'll also note like yes, this is a trend across multiple companies. Algorand, Gemini, crypto.com, op labs, et cetera, et cetera. But just the block numbers alone. We're talking like gross, like layoffs block accounts for more than all of the other ones that you've referenced combined. Just for like scale of.

C (34:21)

Yeah, you could 10 exit and it would, you'd have to 10 exit to get.

B (34:26)

Yeah.

C (34:27)

To have it be comparable or more than. And I. It's interesting what you said about the tech sector broadly. We have started seeing in financial services and some other sectors these headlines of mass layoffs. Like Charlie said, tech so far has been somewhat insulated. But your comment, Charlie, actually echoes something that Powell brought up in his conference last week following the Federal Open Market Committee's decision on interest rates. He basically said the job market is not great right now. That is, hiring has stagnated, but the mass layoffs that you would expect to see in a recession haven't quite come yet. And the labor market is not so dire that you're seeing layoffs left and right. They're starting to creep in, but there's no crazy cascading effect right now. That being said, just to highlight some of those numbers because they really are not stellar, Bureau of Labor Statistics revised their December number down to 17 non farm payrolls lost. The January number was 126 non farm payrolls, 126,000. Excuse me, that was revised. Seems like a pretty strong start to the year. Although if you go back to 2024 and 2023 and even some of 2025, the number is a little bit muted from what it has been. And then for February, a horrible job reading. 92,000 non farm payrolls lost. Average hourly earnings up 3.8% year over year. A few just kind of, you know, some color to this. Part of the reason why the job numbers suck right now is there has been a culling of jobs in the federal bureaucracy. If you actually look at the latter end of the Biden years, the majority of the job growth came from the public sector. So you know, there's a side of you that says, well, are those jobs actually benefiting the economy? Are they actually adding productivity to the economy? Is it raising GDP in a way that is meaningful for people? So when you take all that away and then you also have this incredible AI deflationary pressure, you get a recipe for obviously jobs starting to decline or at least the job market to go stale for a little while. Yeah, go ahead, Charlie.

B (36:47)

Well, I'll say you can paint this picture and February looks pretty bleak, down 92,000 non farm payroll jobs. But I'll say, Colin These days we revise numbers every month, you know, going forward. So, like, who knows what it could be? I'm told that, you know, if we just keep revising, we can keep mashing the numbers to make it look better and better and better. So never count your job numbers until they hatch is kind of what this particular trend of this administration has taught

C (37:16)

me, you know, and also I think just in general with the way that these bureaucrats crunch these numbers. I have tracked these numbers for a few a year or so now on the weekends, and I'm just looking at market data. And to your point, Charlie, it's revised every single time and often it's not revised like a little bit. Like the Delta is a few percentage points. Yeah, it'll go from like 50,000 jobs added to like the 17,000 jobs lost like we saw in December. I don't know what the original number for December was, but it was more. It was an, it was a positive swing instead of the negative one we got on the revisions. That's why some private reports like from the ADP sometimes can be better. The ADP reported 41,000 private sector jobs in December, 22 in January and 63 in February. Now, granted, those are just private sector, they're not looking at public sector jobs. But you can even see there that there's a huge discrepancy between what you're getting from the government report and from the adp. And the last little bit that I'll say on this, looking at the crypto industry specifically, we're kind of getting hit from both sides right now because you have the fact that bitcoin's down not quite 50% from its all time high it was in early February, but it's down significantly from its all time high. You know, it hit like 125, 126,000 in October last year. Now it's at roughly 70,000. And you have AI, which is going to be incredibly deflationary for the labor market, as Portland HODL covered on last Friday's livestream, especially for the software engineering industry, which is the core of a lot of these crypto companies.

A (38:51)

So

C (38:54)

could get messy. Bitcoin rips from here could get messy for the rest of the year.

B (38:59)

Let's move on to the next one. This is also one you're going to lead. MicroStrategy. 21 billion of something. I would like to see the impossible challenge of MicroStrategy releasing a non meme number of something.

C (39:14)

I think the day that happens, the day that strategy sells all of Its Bitcoin or the sky falls through the earth. Because a lot of their marketing and a lot of the even buttoned up financial engineering that they conduct is memetic. You just said they've got the 21 million in here.

B (39:34)

But for the headlines presentation where he's like, in 21 years, the something, the bitcoin's gonna be the something or other.

C (39:41)

I don't know if I can find the presentation too. I'll try to pull it up. When you're giving color on this, there's one where they had like a rocket ship. It was literally a spaceship. And it showed the flow of funds from fundraising into bitcoin and the kind of financial flywheel for all of these preferred stocks that strategy has in relation to their common stock. Anyway, this headline coming at y' all from Blockspace, Saylor Strategy launches 21 billion common stock and 21 billion preferred stock offerings. So Strategy has filed to authorize 44.1 billion in new at the market equity offerings through its strategy, its MSTR common stock and the stretch preferred equity. So the stretches are these preferred stocks which pay dividends. That strategy's got five of them at this point. Stretch is the most popular, I believe. But this would, this would. This at the market offering would be for 21 billion in common stock for either of those, plus 2.1 billion for its strike, which is another one of the preferred shares that it offers. To put this into context, because this is just a staggering number, right? I mean, and for those of you who don't know how these at the market offerings work, they're not going to sell all this in one go. This is basically a way for them to have open offer to sell their stock on the market for big institutional players like investment banks, people who are going to market make, right? So this allows the big institutions to come in and buy stock from Strategy at a on the go basis whenever they want want to, right? So it's not like they're going to sell 21 billion in one go, but they're going to keep it open for people to keep buying into as long as there's interest. And to just give you an idea about what this means, the right now strategy has, I believe, let's see, right here, they've got 6.24 billion remaining under a current stock offering for its common stock MSDR, and they have sold 9.61 billion under the current. Under the current at the market offering that they have open for the strike preferred share, they're going to try to decrease shares they're going to try to shrink the pie. But for stretch, they are authorizing a share increase from 70.4 million to 282.6 million shares, which is a massive increase. The way that these preferreds work is they're trying to target a specific share price and pay a dividend on top of that. And so I would be really curious, I would love to have someone on the next show or two to talk about what this means in terms of the balancing act that strategy has to execute for all of these different financial instruments because they have to pay dividends on these things. This has been one of the criticisms against strategy is that they don't have an income generating business that can match the obligations for these preferred shares. So the only way to continue to furnish the dividends for these shares is to fundraise. And for strategy, considering how big of a company is, that typically means dilution. Selling shares on the open market to get more cash in. But the mstr, I haven't run the numbers for what that would mean for its float, but the MSTR ATM is going to be incredibly dilutive for its stock as well. And one last little note here, Charlie, then I'll kick it to you. This is kind of a twofer because just to give you an idea of who's buying bitcoin right now, it's basically only strategy. My friend from Coindesk, James Van Stratton posted this over the weekend. Strategy set for second biggest Bitcoin buying quarter despite BTC price slide first quarter purchases for strategy this year have reached 89618 Bitcoin. It's actually a little bit higher now because they purchased some, I believe, or they disclosed that they purchased some last week. This is the most since Q4 2024. You can see the chart here. It's cut off at the bottom. But this big candle Right here is Q4 2024. We are on pace. We are already the second. This is the second most buying activity for strategy ever on record. And that is in BTC terms. This is not in dollar terms. This is bitcoin terms, which I think makes this kind of even more wild. Honestly. It just goes to show you how much, how much sway strategy has in the market and how much funding they can still raise from selling their stock on the open market. But I thought that was pretty incredible. I mean, strategy still just plowing money into bitcoin.

B (44:24)

Yeah. I don't have too much to add on this, but I will bring up an interesting thing to contextualize. The scale of this buying. So the 21 billion common stock ATM plus 21 billion stretch plus 2.1 billion strike SDRK adds up to 44.1 billion in potential new capital. To put that in perspective, that is more than the entire market cap of Most S&P 500 companies just for scale of how much money they're yeeting into the wild and wacky universe of microstrategy bitcoin financial engineering.

C (45:04)

So I really like that context. I mean, yeah, I think Matt Kimmel on one of our roundups when we were still doing that format once commented with the fundraises for the AI pivots and expansions that we've kind of gotten numb to, these massive numbers. Is a crap ton of money. And again, they're probably not going to be able to tap all that on a long enough time frame. Maybe they could. If Bitcoin ripped, they would probably be able to do it more easily. They definitely would be able to do it more easily. But that's just a lot of money. And there's something about me that when I see this, it just kind of makes me a little sad. But we won't pluck that thread. This isn't therapy.

B (45:49)

I mean, if you want to put into context, remember 2008 and the financial crisis, by quickly pulling up the numbers, you know, the total like TARP authorization and like a lot, the numbers of like how much money we like used we greenlit to save the economy was like under a trillion, so maybe like $700 billion. So like it's wild now that just a few years later, now we're just doing that. But in Bitcoin it really highlights inflation. So Saylor's been dead on about that. I think we move on to the next topic.

C (46:23)

Yes, but before that we need to do a quick shout out to our friends at Lygos. Hedge funds are getting liquidated. People are panicking. Is your Bitcoin safe? It's not just Bitcoin's price drying up. Whales, hedge funds and lending desks are going under after the notorious October 10 and February 5 liquidations. Counterparty risk is rampant. So it's more important than ever to understand who actually controls your Bitcoin. And with Lygos, you are always in control of your Bitcoin. If you're working with another loan provider, do yourself a favor before it's too late. And check out Lygos Finance. It's our preferred Bitcoin lending service. It's non custodial and they use Bitcoin native Smart contracts to help you protect your stack. With Lygos, you always know where your Bitcoin is. Hold your keys, no wrapping, no bridging, no rehypothecation. Get competitive rates for as low as 10% APR completely. Go to Lygos Finance to learn more.

B (47:22)

All right, so for this next story, this was a BlockSpace LED piece coming to you from over the weekend. Justin. The title goes, Mara launches cloud.mara.com with wrapper for OpenAI compatible API' Mara Cloud is an enterprise AI inference platform that gives you access to state of the art language models through an OpenAI compatible API.

C (47:53)

Okay, sorry. Just imagine going back in time and talking to like your one year ago or grandparents and just tell and just like speaking that sentence to them. They would shoot you. They'd think you were possessed by a demon.

B (48:09)

Well, you've been reading the Mazak Asimov. I mean that's kind of how it would feel. Journey through the center of the Earth. No, we're building data centers over the entire earth. But I mean go back one year and think about marathon statements about. Well, I don't think we're going to get into AI. Maybe it was a year ago, I forget it was not that long.

C (48:28)

Yeah, it was about a year ago or I believe it was actually on the 2024 earnings call. It could have been one of the quarterly earnings calls, but Fred Thiel kind of skirted the question, but he said we're not really looking into getting into AI data. Data center workloads. We might look at inference, but most likely we're going to try to like balance load at these sites. Quickly pivoted from that though. So Charlie, what is, what is, what does this mean? What does this even.

B (48:54)

I think maybe what is it? So for those of you who don't live and breathe the world of agents and AI and maybe you talk a little bit to ChatGPT to ask for recipes like a good American. The rest of us schizos are deep in the weeds of how to like use AI and optimize everything in our lives. Buying Mac Minis and what so. But there are the. So basically there's a bunch of different AI models. A lot of them are proprietary and private. Your anthropics, your OpenAI's and your Googles have those like frontier models that the best and smartest ones and then there's open source ones and there are these platforms now that kind of are almost like dashboard to let you use any of these models that you want. One of the popular ones that I'M familiar with is called OpenRouter. It's pretty popular. So Marathon launched their own dashboard and they have three of these AI models that you can choose from. There are three open source models, so not the proposed proprietary ones from anthropic or OpenAI. And this is cloudbar.com. what this is is, you know, in AI you have kind of basically two types of like compute that's neat that need to be run. There's the training of the models, the creating of them and then there's the running of them. So like when you're actually talking back and forth to these models, this is the inference, the running of those models. So Marathon is opening up a portal or a platform. Cloud, cloud. Two inference models you can choose between like deep seq v3, the Chinese open source, I think that's a Chinese open source one, a GPT open source model. And so you can do these and it costs money. They've got API endpoints you can pay for. So the thing is, that's what it is. I got some takes, some spicy takes here. You're muted.

C (50:55)

I'm specifically curious about the cost Charlie, because you were mentioning something interesting about that.

B (50:59)

So here's, here's the thing. I've dug a, I've dug a little bit into the cost and I'm still digging into it because this is kind of a new story why these, this platform is multiples more expensive by what I can see compared to all the other options. Like it's, it's, the pricing is pretty terrible. In fact it looks like it's four times the price of the median price of other services like oh, together AI or Fireworks or Open Router. And I'm kind, I kind of, you know, why is it, you know, is that just because it's a new feature and they're going to optimize it? Maybe it costs them more to run Inference, I don't really know. They do give you a five dollar credit for signing up but that credit gets used up pretty quickly as like calls are like you know, in the, in the field of like a dollar or so. Whereas if you were to go onto other platforms it's like 30 cents. So if we were to compare across the ecosystem, this is like one of the worst priced cloud like inference platforms that I can see. I want to dive deeper and verify this and I do just kind of wonder like I haven't even bothered I signed up for an account on this cloud, this MARA cloud platform. And I do kind of wonder because like if it's Actually that useful compared to me just using open router. You know, I'd be really curious to

C (52:26)

see what differentiates one of these aggregators.

A (52:29)

Right.

C (52:30)

Would it be the speed that, which queries are processed? Is the interface just cleaner, easier to organize all of the different chats that you're having? I would say I haven't played with.

B (52:41)

This interface is not, this interface is not clean. I think I actually missed a little bit of important context here. For maybe the listener who's not dialed into AI, you can run inference on somebody else's server. Like you talk to ChatGPT and the compute happens in a data center far away from you. You can also run these models locally. So basically what you're doing whenever you buy that ChatGPT subscription or Claude API credits you're basically paying to use on someone else's server. You can run some of these locally. So like I run some local models here and it's, they're free and so like, you know, this is like a big looming question for the industry which is Will, like is there actually a significant value, a long term value in providing inference for like the majority of these, of this like type of compute? Like will these models get so efficient and so capable that the average user can run them locally and not really want to pay for the expensive usage from these platforms? This is a big open question I think has deep implications for the future of capex spend for AI Maybe I think it's a little more clear that training the models, they have to be created, they have to be summoned and grown into existence but then actually running them, is there a long term moat there for the majority of AI use? Who knows? So these are like the big questions that nobody really knows. Maybe it's path dependent, maybe it's inevitable. Heck if I know. So it's funny because that in an age of like you have powershells, powershell models for these miners, you have neocloud models for the miners. Is it really that smart to try to then also be the platform for these models? Yeah, I mean that's what I was

C (54:34)

gonna, that's what I was gonna close with. That's the really up in the air question about this for me. And if we look at Mara's product history, they often veer off into these strange, I guess we'd call them side projects. Some might call them distractions.

B (54:50)

I love the side projects. I love their side projects. They're super fun.

C (54:54)

Well the thing is some of them are legitimately cool. Like Slipstream, right. Was a transaction accelerator. It Allows you to go straight to Maramera. Runs their own mining pool.

A (55:03)

Right.

C (55:03)

Mar. So they have a massive bitcoin mining operation. It's over 50 exahashes at this point. They have their own mining pool that they use. So they're really a self miner.

A (55:13)

But.

B (55:14)

And they're pushing, they're pushing quantum research and quantum solutions which is really cool. They're kind of lab side. Yeah.

C (55:21)

And so they do a lot of these projects that are adjacent to their core business, bitcoin mining and soon to be, you know, AI and traditional data center operations. But that aren't necessarily maybe the smartest thing to do rather than just focusing on that core business. Because slipstream, as far as I know it gets very little use. Very cool. But there's not much revenue in trying to get people to pay for direct inclusion into a block.

B (55:46)

They also cost a lot either it's very profitable. I will emphasize that it's very profitable, but it's the profit.

C (55:52)

Sure. But it's a small piece of the pie. Yeah. You know what I mean. This is a company that does hundreds of millions in revenue.

A (55:59)

Right.

C (55:59)

And so maybe if you a million or so here and there from something like that might not move the needle so much. They also had this, they had this immersion technology called two pick that they I believe shelved and abandoned. Supposed to be a way to run immersion cooled bitcoin mining infrastructure more easily. So I kind of just am with you, Charlie, echoing what you said. Is it really the play for them to be getting into services, software services for AI or should they really just be doubling down, trying to figure out how to get contracts for hosting, hosting GPUs or coming to your cloud themselves? We'll see a kind of a strange product, but in line with stuff they've done in the past.

B (56:41)

So enough about that. We'd love to have someone who came up with a who's a AI strategy at Mara or other type of companies come on the pod. We love to cover the subject. Otherwise this is wrapping up the show for the day, I believe. Make sure if you're listening and you haven't already liked and subscribed subscribed, hit that notification bell on YouTube and newsletter blockspace media newsletter block space media.com if you want to get our newsletter. And it's still not too late to grab that ticket and book that flight to New York for up next April 16th our Bitcoin technical conference.

C (57:16)

Thank you all for tuning in. We'll see you on Wednesday at the same time and Friday really looking forward to Friday show. We've got got Matt Williams from Luxor coming on, going to be talking about hash rate, financial markets and GPU financing. And we've also got Asher Ganute, CEO of Hut8, on to talk about some of their AI initiatives for 2026. And with that, we will see y' all next time. Have a beautiful week, everyone.