Vanguard Just Flipped On Bitcoin

Summary

Podcast Summary: Onramp Bitcoin Media – "Vanguard Just Flipped On Bitcoin"

Show: The Last Trade
Date: July 9, 2026
Hosts: Jackson, Michael, Brian
Theme: Institutional Bitcoin Adoption, Market Cycles, Wealth Trends, and Societal Shifts

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Overview

This episode centers on the news that Vanguard, a historically Bitcoin-skeptical institution, has posted a job opening for a head of digital assets—a move signaling its entry into the digital asset space. The hosts discuss what this means for Bitcoin adoption within legacy finance, contrast it to strategies taken by firms like BlackRock and Fidelity, and explore broader topics such as market cycles, momentum, wealth inequality, social trends, and data security in the context of Bitcoin. The conversation blends big-picture macro insights with relatable commentary about investing, monetary policy, and the evolving digital asset landscape.

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Key Discussion Points & Insights

1. Vanguard’s Foray into Digital Assets

• Job posting as a signal:
  The opening is for a role in Vanguard’s personal wealth division. The hosts see this as largely reactive to client demand rather than visionary leadership.
  • "This reads to me like they're doing it basically because...all their peers...are building towards these rails that we talk about every week." —Brian, [05:05]
  • "It's not the most bullish thing...it's a lot more nuanced than that." —Jackson, [09:25]
• Outlook on the hire:
  The job could be "the best or worst role," depending on the corporate culture and appetite for genuine Bitcoin engagement. Vanguard's intentions are likely conservative and peer-driven.
• Comparison with peers:
  BlackRock and Fidelity moved more decisively into digital assets. Fidelity’s digital arm, for example, was spun out due to internal frictions typical of large, legacy institutions.

2. Institutional Momentum & Bitcoin’s Market Dynamics

• Late-mover disadvantage:
  Vanguard’s slower entry means missing first-mover advantages in liquidity and brand, especially as platforms solidify custody partners (e.g., Coinbase) and ETF providers (e.g., BlackRock/iShares) ([11:05]).
• Building during the bear:
  Downtrends are being used as a time to build infrastructure—even as Bitcoin sits ~50% below ATH, the institutional plumbing is being laid ([14:57]).
• Retail vs. Institutional:
  New products will likely be majority retail at first but will pave the way for larger institutional allocations over time.

3. Bitcoin Market Context: Intrinsic Value & Momentum

• Bill Miller’s “Intrinsic Value” Piece:
  Bitcoin usually trades at a discount relative to its "intrinsic value" due to low global understanding.
  • "Bitcoin has always for 17 years traded at some amount of discount to its intrinsic value, right?...its ultimate value...is much, much higher than where it is today." —Brian, [00:00], [20:10]
• Subjectivity of Value:
  The notion of intrinsic value is questioned—value is subjective; markets are driven by flows, not solely fundamentals ([23:11]).
  • "Intrinsic value as a term is a...made up TradFi term...it doesn't account for...the debasement of the currency in which you're measuring." —Brian, [26:28]
• Momentum and narrative:
  Bearish momentum is attributed to various factors (AI siphoning capital, selling activity), but rebounds are the result of a “combination of factors”—not a single catalyst ([13:28]).

4. Societal Trends: Wealth Inequality and Policy Backdrop

• Thesis of "socialist moment":
  Current populist/socialist swings are seen as reactions to extreme wealth concentration, driven by fiat system debasement—illustrated by a WSJ chart ([46:39]).
  • "It's not that there's some newfound resurgence or belief in the actual ideas of socialism...it's the existing status quo...creating this false binary..." —Brian, [43:44]
• Downstream behaviors:
  Loss of faith in social mobility (due to monetary debasement) is increasingly met with either generational wealth preservation (Bitcoin, assets) or with social unrest/gambling/addictive behaviors ([56:32]).
• Inflation hitting tech:
  Tech, once immune to inflation, now sees price hikes even in consumer products like iPads and MacBooks—a marker of shifting economic tides ([61:49]).

5. Education as a Cycle Driver

• The hosts see Bitcoin’s price cycles as necessary for global education: downturns shake out weak hands and prompt learning; the asset's endurance invites new entrants ([18:39], [30:19]).

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Notable Quotes

• On Bitcoin’s Discount to Value:
  "If it were connected [to intrinsic value]...everyone on earth, every investor, every allocator, every individual understands bitcoin. And we obviously know that’s not the case." —Brian, [20:10]

• On Institutional Change:
  "At the end of this day, a lot of these firms will be losers because it's like the Blockbuster narrative." —Michael, [07:59]

• On the Role of Education:
  "Education permeating...is almost why these cycles are a necessary function...the moment it doesn't die and you find some price bottom is when people start to question their past assumptions..." —Brian, [18:39]

• On U.S. Stablecoins & Policy:
  "Digital assets, stablecoins, tokenization and new payment systems will help shape the future of money. The United States should not co-sign itself to the sidelines..." —Jackson, quoting Treasury Secretary Scott Bessant, [37:27]

• On Gambling and Markets:
  "It's just the poor man's gambling and the rich man's gambling is the stock market...you’re gambling with your money. It's on the other side, but it's normalized." —Michael, [57:32]

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Important Timestamps

• 00:00–05:30: Opening banter; introduction to Vanguard's digital asset job posting and skepticism about institutional motivations.
• 09:25–12:01: Analysis of why Vanguard is moving now; implications of late adoption; BlackRock CEO’s previous Bitcoin experience.
• 14:57–17:00: Infrastructure building in bear markets; retail/institutional interface.
• 20:10–27:17: Debate over "intrinsic value" of Bitcoin—Bill Miller piece, subjective value, education’s role.
• 30:19–32:37: Education, inflation, and the catalysts driving Bitcoin’s future adoption.
• 37:27–40:12: U.S. government policy signals; open USD and stablecoin strategies as extensions of U.S. financial influence.
• 43:44–52:02: Socialism, wealth concentration, and populism—contextualized by U.S. monetary history.
• 53:24–54:39: Data breaches in crypto and the imperative of strong security/custody solutions.
• 56:32–61:09: Rise in gambling disorders as a symptom of economic malaise; ease of access vs. societal outcomes.
• 61:49–67:23: Price inflation hits consumer tech; wealth divides deepen; global perspectives on access to technology and wealth tools.
• 67:23–70:09: Recap of data breaches, AI tools uncovering records, ongoing need for vigilance.

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Memorable Moments

• Jackson jokes about leaving to take Vanguard's digital asset job if listeners prefer another show, prompting ribbing from Michael and Brian ([02:13–02:42]).
• "I'll send you the shirt off my back" —Jackson offers to ship his (unwashed) shirt as a promotion for booking a consult ([70:32]).

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Conclusion

This episode fuses acute market insight with wry commentary on institutional inertia, financial cycles, and societal shifts as Bitcoin becomes ever more integral to the financial system. Vanguard’s move is more an evolutionary step than a paradigm shift, but it’s a meaningful signpost on Bitcoin’s path to mainstream acceptance. The hosts’ nuanced dissection of bear market psychology, the subjectivity of value, and the broader macro backdrop renders this episode indispensable for anyone seeking to understand the intersection of digital assets, institutional finance, and the changing social fabric.

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For further information and detailed show notes, visit onrampbitcoin.com.

Transcript

[Brian]

Bitcoin has always, for 17 years, traded at some amount of discount to its intrinsic value, right? Because if it is what we all think it is and believe it to be, which is this better form of money that's finite and will monetize over time, then its ultimate value, or terminal value, however you want to phrase it, is much, much higher than where it is today. And so downtrends like this are just an exaggerated form of that disconnect. But it's always disconnected. Because if it were connected, then what that means is that everyone on earth, every investor, every allocator, every individual understands bitcoin. What you're telling me is that music

[Jackson]

is about to stop and we're going

[Brian]

to be left holding the biggest bag

[Jackson]

of odorous excrement ever assembled in the

[Brian]

history of that person.

[Jackson]

1974-1987-9297-2000, whatever we want to call this, it's all just the same thing over and over. We can't help ourselves.

[Brian]

I say when we sell.

[Jackson]

Hey, okay.

[Brian]

I say when we sell.

[Jackson]

We are back. Michael and Brian, welcome back to the Last Trade. There's been over a week. How are you guys doing? What's the latest? Are you excited for this week's episode of the Last Trade?

[Brian]

Always.

[Michael]

Never. There's a big line of demarcation Pre and post 26, and I feel like the July 4th week was a nice middle ground. It was a weird time for me to be it on Saturday because it felt like the whole week was a little off because everyone was like, out. There's just like a lot. And so coming back feel like we have the remainder of the year, a lot of exciting stuff to work on. But what I did want to ask is in the comments, what show do people like for the. The listeners of Final Settlement Last Trade? You just leave a comment. Which show you enjoy more? Because I think, you know, Jackson thinks it's this one, but I don't know.

[Jackson]

I think we reproduced. I would love to know. I would love to know.

[Michael]

Anyone doing that. Like and subscribe.

[Brian]

Yeah, you can like and subscribe rate 5 stars.

[Jackson]

Truthfully, I don't know how much longer I'll be doing the show because I just came across this listing at Vanguard for head of digital assets for the personal wealth division.

[Brian]

Seems. Seems lucrative.

[Jackson]

And so it seems like it's also, you know, you could be based out of Malvern, Pennsylvania. That's not too far from me. So, Michael, in terms of what happens in the bank second half of this year, you may have to find a new host. And that might be to be okay, assuming everyone likes final settlement more anyway. But I want to start with this before. Yeah, go ahead. What do you have to say, Mike?

[Michael]

Well, I was just gonna say, like, this is an interesting role because it could be the best role or the worst role in the world, to be honest, for the right, for the. For the person, simply because what kind of leeway an organization like Vanguard provides and also where they discern signal versus noise. We talked about two years ago, we were in Wyoming for the SALT conference and Franklin Templeton CEO was talking about. I don't even know. Brian wrote a long reporter update on that, but I heard a little bit of it and it was like you just did not want to work there. If you understood you coins, stable coins, tokenization. But the things you think about in crypto are what they're focused on. And so similar to Vanguard could be a great role for you, Jackson, or it could be the worst role because you go in there and realize there's a $10 trillion beast that will eat you alive within a week.

[Brian]

Yeah, I would. I would err on the side of probably not the best role. And it's also a difficult role to hire for in the sense that someone that has the expertise that's probably needed to like thrive in a role like this might not want to do it at Vanguard. And Jackson, if you pull up the. The tweet from our buddy Eric Balchunas, who had a little bit more intel and insight on. On what they're trying to accomplish with this role, it doesn't seem like they are super pro the asset class, particularly not, you know, not particularly bitcoin by any means, you know. Yeah, if you click into what that says there, like it. This reads to me like they're doing it basically because they. They felt like their hand was forced to hire for this because everyone else around them, all their peers in Tradfi and the enterprise landscape is building towards these rails that we talk about every week. But the way that they phrase this, you know, blockchain tokenization, it reads to me like, you know, the 2017 era of enterprise, enterprise blockchain build outs. And not a. Not an actual conviction or belief in the asset class or bitcoin in particular, but just feeling like infomo's kind of the wrong word. But it's like the inertia or the momentum of their peers is pushing them in this direction. And it also reminds me of when I was at Brown Brothers back in the day. Like they had this digital asset working group and it was like when I was deciding whether or not to leave, it was like, well, I can go, you know, join this digital asset working group and try to like steer them in the right direction. But is that really what I want to spend my time doing? Because it's going to be a slog, it's going to be an uphill battle in terms of winning hearts and minds that it's not just about tokenization. There's a broader story going on here. So that's kind of how I read this is like they're not super fully bought in, but they feel the inertia. And again, it's a very difficult role to hire for because the person you want probably doesn't want to go do this at Vanguard.

[Michael]

Yeah, there's a few things because I know Jackson, you have some thoughts. But like just to add additional context, there is like a spectrum. Nothing's black and white. And there's a person that is super entrepreneurial, they're best suited to go start something. There's the other person that's insanely diplomatic that would, I don't want to say thrive in that role, but he would be able to. He would enjoy, he would personally enjoy it. I don't necessarily know if you can thrive from an objective metric standpoint in that role given what Brian said. And that person has to manage bureaucracy, working through a lot of red tape and it would take years to launch anything of substance. And we've seen this firsthand. This is not intimate knowledge. But if you look at Fidelity as an example, Fidelity has Fidelity Digital assets that sits aside from Fidelity proper because of this inertia that exists. 7 to $10 trillion 100 year old firm, however old they are and from their shareholders to the client base and manage the amount of capital there was already, but that was a family owned business but a lot of friction in getting there. And they've, you know, they looked at the market, they understood this will what disrupted. They didn't, you know, chase the wrong thing. So they're in a good spot now. But if you're like to Brian's point, a firm like this has been historically antagonistic to it. You have a legacy, you know, board and all these other things in place and you're just kind of like going in lukewarm. That's a terrible spot for a lot of people on that 1 to 10 list because somebody thinking they're going to go in and change things probably doesn't now I think like Schwab is probably in the middle, probably skis towards that direction but they probably know the market's going there versus like Franklin Templeton is further on. Like let's push the puck. I think that just gets lost from a lot of people when you think about tradfis. There's just so much and it's actually more than traditional. When you look at like IBM and traditional tech firms and because I personally experienced this, I was at Google and Google's supposed to be at the forefront. We were at a startup outside of Google and we had a lot of leeway. But then eventually when you get to success, Google comes in and they're like board members and different people at other parts of the org come in and bring that bureaucracy and they're like well what am I doing here? And so that same respect exists in traditional tech but layer in financial services. So these things disrupt the thing that they're offering whether it's today or tomorrow. And smart people see that. And so that's just part of like this whole construct that is a machine. That's why I think of these. At the end of this day a lot of these firms will be losers because it's like the blockbuster narrative. They won't get out of the.

[Jackson]

Michael, just tell me you don't want to leave the company, man. You don't need to be so long winded. I'm not going to take the job. I'm not even qualified for the job.

[Michael]

I wasn't worried, I wasn't worried about that. There was no way you're getting a good referral. So I wasn't, I wasn't concerned about the leaving. I was just trying to get the audience some understanding of like that these things look so lucrative or interesting and innovative and they're so like under the under because this, this space moves so fast. So it's like inherent to the opposite of like what they do.

[Jackson]

I think, I think on the positive side what I, what I find interesting is so it's actually not, it's not a chief of role, it's not at the helm of Vanguard. It's more specifically within the personal wealth division. So as I understand that's more of the high net worth advised clients. And so it could be a function of Brian, partly what you mentioned where there's just the peers that are getting involved and have seen success in launching products. And then also we know that a lot of this is client driven and so if you don't meet your clients needs and demands at some point, the clients leave. The other thing that I found was particularly interesting is the Vanguard CEO currently, you may, or you may recall, late 23, early 2024. I forget the name of the CEO at the time, but he was vehemently against Bitcoin. And so they have a new CEO as of two years ago now, July of 2024. And he was actually the person who headed up iShares at BlackRock. So he was there for the launch of iBIT and saw them, I guess get to call it 50 billion or so in that first year. He parted halfway through the year, but he was on the winning side of the most successful ETF launch ever and the most successful Bitcoin ETF in that context as well. And so I think it is kind of. It's not the most bullish thing I know. Of course, if you go on X, people are going to just tell you, oh, Vanguard capitulated, they're going all in on bitcoin. Of course, it's a lot more nuanced than that. But I do think over time that these firms need to be strategic in terms of what are they offering to their clients. They also need to have a position as well. If their clients are asking them about Bitcoin, they can no longer just say, oh, well, I don't have a great answer to that question. They need to have, they need to produce research, they need to have informed takes on what's happening in the industry. And they also are in the business of making money and they're also the largest passive fund manager. And so I think all this kind of points in the right direction. But I agree, the potential downside or the potential negative, negative outcome here would be that there's just a lot of wheels spinning, a lot of bureaucracy and it ends up going nowhere in the next couple years. But I might take the other side of that, just given how quickly other firms in the space have had to move into bitcoin and digital asset space the past two to three years.

[Michael]

Yeah, I think that ultimately is good framing in the sense that everyone's going to have to capitulate and play in this game. And that's effectively what's happening. Their relevance is the thing I think we're calling to question. And from innovating or where capital goes.

[Jackson]

Yeah, and they were slow too. They, I don't think they actually approved any ETFs on the platform until the end of last year. So they missed like the first two years of significant demand. And then of course, the market turned in October and so now it's been a bear market. But of course bear markets are good times to build and they're now starting to potentially make hires, build out the team that are necessary.

[Michael]

There's a good framing around all of this that Liam had shared around liquidity. When you look at like ETFs as an example, BlackRock being first and just the acknowledgment of where the flow sit and then coinbase on the custody side that there's real like Lindy and inertia that gets embedded in who comes first in these asset classes. And so I think about like the firms like this that are coming in even like Fidelity will, you know who at bitcoin price at 150,000, 200,000 I think we all agree and a lot of listeners too. It's like multi institution will end up in some form of standard for a lot of firms but the ones that start with it first are going to end up with that liquidity profile that will compound on itself while others will be on the back end because like why would you go there? Because you're just layering on more operational excellence, more financial services. And so that's where I think a lot of people underscore or underestimate the value of getting in faster and being able to understand this like market.

[Jackson]

Yeah, there was another story as well I think of the past day or two. The director of digital assets at Charles Schwab, Jim Farioli, came out with some comments regarding Sailors recent sale of Bitcoin. And I think people kind of made it, you know, maybe took the wrong narrative from it but essentially he said that the recent weakness in the bitcoin price is not related to MicroStrategy's moves and it's really just a momentum trading thing. And I there's not too much to talk about there but I think it a reinforces the last point on Vanguard is these firms need to have people that are able to speak to what's happening in the market because naturally their clients are going to ask questions and they need to be able to defend either not allocating or recommending a strategic asset allocation as part of portfolios. And then the second aspect as well as Brian, as we've talked about on more recent episodes, is it really is a momentum game.

[Brian]

Right.

[Jackson]

And so bitcoin currently does not have a lot of momentum for a number of reasons. People want to be able to point to a reason as to why it doesn't have momentum or why the price is down 50%. But I think as you've articulated on previous episodes, it's just a matter of of course Buying and selling at the margin. And right now there's just a lot of buying that's happening in AI and semiconductors, and there's a lot of momentum in other asset classes that has historically been in Bitcoin. And so it is just a matter of kind of waiting for the bottom. Not even waiting for the bottom, but waiting for us to get through the trough of momentum before things start to pick up the other side.

[Brian]

That's well said. Yeah. I mean, it's always a combination of factors, I think, is an important thing to keep in mind. Like I, like I've said before, people try to ascribe catalysts or narrative either up or down in terms of price of, of what's going on. But you know, bitcoin has this, you know, the freest market that exists. Like, there are a plethora of different variables at play at any given time. And you can say it's the AI trade sucking capital. You can say it was the quantum fud six months ago. You can say it was the OG sellers a year ago. Like, there's a number of different things that together in a combined fashion have, have sort of led to where we are today. And I think it's, you know, prognosticators and talking heads like to try to pinpoint. Well, it's this specific thing, you know, like you're saying the Charles Schwab guy saying, well, it's not sailor. It's like I, I agree to some extent, like, it's not sailor. The sailor's not the reason we're at 60k. But is he a contributing factor? To some extent, the perception of their holdings, the centralization of their holdings, sure, I'm sure that contributed some amount to where we are, but it's always a combination of factors. And it's a combination of factors on the way out as well. Right. It's not going to be clarity act. It's not, not going to be the sbir. It's going to be a combination of factors that allow the price to inch up higher. People realize this thing isn't dead, and then the momentum comes back to the asset.

[Jackson]

So as we were talking about, there's a lot that's been happening on the institutional side in terms of new products being launched, new hires being made at companies turning on access infrastructure. There's a lot that is being laid in terms of groundwork so that these institutional firms can start getting their client base into Bitcoin. And so it's really an opportune time because Bitcoin sits 50% below its all time high yet the plumbing is being laid so that a lot more buyers can come into this market. And that really underscores why now is a great opportunity to increase allocations to Bitcoin and secure what you have already. So for listeners of the show, use code TLT book a consultation below we'll have a quick call, answer any questions you have and then we also have a special promotion for listeners of the last trade. So again if you want to learn more about what we do here at Onramp in terms of brokerage, custody, insurance, inheritance loans, et cetera, book some time use code TLT link below. Would love to speak with you. Always enjoy the conversations.

[Michael]

So on that I know this is going to sound like insane cope but this is actually the most bullish 50% retrace we've ever experienced in bitcoin and it gets lost on individuals. But if you think about 17, this asset class was, you know, there was a crazy blow off top, there's a lot of rumors with Coinbase and how we even got to that level and then the next blow off top was FTX and everything that happened. And so everyone's familiar with the pensions that got rugged and a lot of the firms that shelved a lot of the initiatives that we're working on. The fact that we didn't get a blow off top, there wasn't all the leverage that brought the market crashing down and we've kind of that volatility on the up and downtrend hasn't been pronounced enough to scare anybody out, has let all these individual actors execute on their plans. And so we've seen this. I don't know if we're going to cover but like the open USD stuff, you know, Charles Schwab coming on, additional ETP products coming out globally including with BlackRock Vanguard, like this is what is going to bring liquidity that we could never even imagine. And that's what's going to be like on the other side of this. And this is just the process of that.

[Jackson]

Yeah, I mean I can't really argue that because at the end of the day these things do take time to build out. And I think Michael, to your point, this is the perfect time to be building all these, building all the products, building all the infrastructure, building all the access and eventually there's going to come to come a time where all these things are in place and then what are the incentives point to? The incentives point to these firms selling the shit out of these products to people whether or not they believe in them. Right. Because that's just the nature of Wall street is you want, you need to sell product to make money. And so there's nothing inherently wrong with that necessarily, but there's going to be all the incentives aligned where historically in past cycles there have really been none of those incentives for those actors to be positive on bitcoin, positive on digital assets. So I don't know how quickly that happens because again, there is bureaucracy and there does take time to build these types of offerings out at firms at a large scale. But we are seeing things happen month over month, quarter over quarter. I know Schwab has gone live with the, the bitcoin brokerage on their platform. E Trade has done it as well. You have Vanguard hiring out a team to advise on the, on the high net worth side. And so these things will just eventually compound. And Brian, to your point, it won't be necessarily one catalyst that will get us back to new all time highs. It'll just be the momentum of new buyers coming into the market. And what I expect a lot of new buyers that previously have just been sidelined for whatever reason are going to enter as well, particularly on the retail side. But I do think that these products are going to be probably not majority institutional, but they're going, they're going to be a majority retail to start, but they're going to provide much easier on ramps into institutional capital, in my opinion.

[Brian]

Yeah, the, the one other thing I would add to that is like, I think critical to all of this when you think about cycles and momentum is ultimately like it all comes back to just education permeating throughout the globe. And that sounds simple and maybe trite, but like that's almost why these cycles are a necessary function of the monetization process in that when the price falls and comes down and people think it's dying and collapsing, the momentum goes away. Right. People stop caring about it. They think it's going to die. The moment it doesn't die and you find some price bottom is when people start to question their past assumptions about it. And that's actually what sparks new entrants and new education. Like people actually learning about okay, well why didn't it die? What are the fundamentals at play that make this decentralized, secure, better money? And so you almost need that process to spark the continuation or new people learning about what makes bitcoin bitcoin. So I think that's just, that's a component at play and it's, you know, there's no point in really trying to time that process, it just. It's something that naturally plays out.

[Jackson]

Brian, I want to get your thoughts on this piece from Bill Miller. The intrinsic value of bitcoin. It's something you flagged to me this morning. I skimmed it. I didn't read it. But it's not a long read. So what, what's your take? What's being said here by Bill Miller? And then what's your take on it?

[Brian]

Yeah, Bill put together this nice little. It's a pretty brief read, and it relates to what we were just talking about in terms of. I think in the tradfi world particularly, people have a hard time wrapping their mind around bitcoin. What is its intrinsic value per se? It doesn't have cash flows. People typically think about intrinsic cash flows as discounting some future value based on cash flow streams back to a present value. And you can't really do that with an asset that doesn't produce cash flows. But that doesn't mean that things that don't produce cash flows don't have intrinsic value. It's kind of the point of this piece. And he's saying, and I agree with, it's like bitcoin has always, for 17 years, traded at some amount of discount to its intrinsic value, right? Because if it is what we all think it is and believe it to be, which is this better form of money that's finite and will monetize over time, then its ultimate value, or terminal value, however you want to phrase it, is much, much higher than where it is today. And so downtrends like this are just an exaggerated form of that disconnect. But it's always disconnected. Because if it were connected, then what that means is that everyone on earth, every investor, every allocator, every individual understands Bitcoin. And we obviously know that that's not the case. And the point that he makes is like, okay, if you were to play this out and say what people like to talk about in terms of just gold parity, right? Like if bitcoin gets to the market cap of gold, that's how some people think about what the value of bitcoin could be. Now, I think we believe that bitcoin improves upon gold in many ways, so its terminal value is likely multiples higher than what gold is today, even. But even if you just think about that, it's over a million dollars a coin. So when you think about intrinsic value, it's just important to, one, realize that things without cash flows do have intrinsic value inherently. And two, bitcoin is always going to be disconnected from its intrinsic value because a very, very small percentage of the globe understands what Bitcoin is. They conflate it with other cryptos. Fundamentally, they don't even understand what money is. And so that's really the first barrier to entry in terms of understanding Bitcoin's intrinsic value is understanding what money is, what its purpose is, what monetary properties you would want in a sound money. And so again, it goes back to what I was just referencing around the education, right? As the education permeates, Bitcoin naturally follows its price, follows in terms of getting closer and closer to its intrinsic value as more people understand what it is. And it's also very. This is very similar to, like the tenants of value investing, right? Like, the reason Bitcoin is a, is a good value investment proverbially is because the vast majority of people don't understand it. They, they don't understand the potential true intrinsic value of it. So this is a good piece by Bill. I recommend people checking it out.

[Jackson]

Yeah, I mean, my take on it is. I would largely agree with what you said, Brian. I have a little bit of a different opinion just on the topic of intrinsic value, because first of all, value is subjective even, you know, with anything. But even if you take the example of equity markets, people are willing to pay different prices for a stock or for an index, right? And so price to earnings is one way that you could measure that. But there are plenty of fundamental metrics that, to your point, value investors have used historically. I would argue that intrinsic value, if you're defining that based on cash flows for the equity market, doesn't really matter anymore. And it may sound hyperbolic and it may sound like a. This time is different. And I'm inevitably going to get myself wrecked saying that. But people have been talking about price to earnings ratios and staying out of the market for 20 years almost, at least since 2008, at least since QE, at least since liquidity deficit spending really ramped up significantly. And so it's kind of frustrating to me that we even have to first of all defend the notion of intrinsic value with Bitcoin because forget about the intrinsic value of all the other asset classes. Right? And so my broader point here is that people are just looking for something to preserve their wealth over time. And equity markets do that. They're essentially the piggy bank of the American economy at this point. I think the top 1% own like 50% of the equity market. The top 10% own 80 to 87 to like 92% of the equity market as well. And then you have everyone else in the bottom 50% that are still participating on the margins when they can. But essentially everyone is funneling their savings into home prices or into homes and into stocks. And at this point it doesn't really matter the price you're willing to pay because if you're not paying that price, then you don't have a ticket to the. You don't have a ticket or you're not in the door. And so you're just getting poorer and poorer over time. And so I'd make the case here that sure, there's certainly value and intrinsic value to owning Bitcoin and you can't value it based on its cash flows. But there's other ways that you could think about its terminal value. And Brian spoke to some of them. But I would even argue like the whole idea of intrinsic value investing is, is a little bit irrelevant because the market that we live in is just different than the market of like the past 50 years. And so I know it's a little bit of a ramp, but that's a, that's how I feel about this current topic. And then if you even like one other piece data point to support this would be the Trump accounts, right? Like I think that's a good thing for anyone. It's free money. You might as well set it up if you have a child that qualifies and if you want to add to it, more power to you. But what you're doing is you're just buying into an index with no, no perception of fundamentals.

[Michael]

Right?

[Jackson]

You're just buying more passive flows, bidding, bidding week after week. And so that's what the market has become for better or for worse. And I think it's just, we're better off acknowledging that like investors are just better off acknowledging that.

[Michael]

I won't do it to him, Brian, but I will just joke and if he pushes then I'll explain. But it would make sense that Jackson would be in favor of free money because he wanted to do UBI on Bitcoin so he would believe that the government, you know, his money going back to kids is, is a good thing versus him giving it directly to his kids. But either way I digress.

[Jackson]

I mean it's kind of stupid not to take a 000 even if you plan on never.

[Brian]

Actually, I, actually I agree with you, Jackson. One note on the intrinsic value stuff. I think you make good points in that intrinsic value as a term is a, it's a made up, It's a made up Traffi term. So what it doesn't account for is what you're describing, which is the debasement of the currency in which you're measuring the intrinsic value. Right. So like, I totally agree with your stance in that it's, it's kind of meaningless in some, to some extent, but it's like, you know, if you value it in gold or sound money, it's like, well what, what will this be worth in the future to someone? And like you could make those arguments about certain companies and equities as they, you know, compound value and provide more value to society. Right. So there is, there is some element of truth to it. But to your point, if you're denominating in something that is being debased, then it, it becomes harder to assess effectively.

[Michael]

So maybe to tie this together, this is where I think like the natural synergies long term of Bitcoin and AI, there's so many, whether it's on the just infrastructure and energy side to you think about compute. We were talking about the podcast with the Grok founder and this notion of inference and our acknowledgement of like when you put in a prompt, we don't even know how slow it is. In the same way you didn't know how slow bandwidth was until broadband came about or dial up was. And well, what happens when machines use AI? Because that's what will happen. And then you'll just need that latency to be tied together. And when that happens so fast, you don't recognize that you need to transfer value to go and set things up in Bitcoin. So anyway, point being is like where I'm getting at is there's such an insane opportunity on the AI front in the same way with the bitcoin front. Because what we just described, and it

[Brian]

goes back to what you talked about,

[Michael]

Brian, on education is so fundamentally dislocated based on. I love that piece that you put out a few years ago about the most value investment like Bill Miller. So it's just this notion of buying something before the market understands its true price. And that true price in the dislocation is where you see a lot of the things that come up and just all the different proliferations of this ecosystem, whether it's cryptocurrencies or second and third layer bets on Bitcoin and there's just a dispersion on the understanding and that's. There's no definitive, it's a platypus like the asset. Because we can talk all about Western US markets and S&P and different ways it's dislocated from the fundamentals. Or you talk about the banking sector, but that's fundamentally different than someone in Latin America or Europe that needs a neutral asset that can't sit within those rails because of the things they experience. And so there is no like singular view. We can talk about intrinsic value, we talk about fundamentals, we can talk about objective ways to discern what's a good form of money, but at the end of the day, like there is no actual singular way. What's most exciting though is once you start to understand long term what this asset is and it's just money, and then how people will rationally think about when I hold a material amount of this type of money, what do I need to do to protect myself from my family, from inheritance, from all the things we talk about here. You start to be able to really deeply understand the asset, what kind of products you want to put your personal wealth in. Because downstream, if this thing's going to monetize in the way you understand it, if you're right, well then these things are speculative or scary or potentially capital risk is all of it. But then if you're an entrepreneur and you come at it through that lens, you have a huge opportunity to start developing the products and services that tie into it. So I'm just bringing this up because I don't necessarily, like we could go in circles forever around what is subjective and objective and what is. But at the end of the day, this thing is monetizing in real time. And the best example of this is like people will be hardcore into Bitcoin but they cannot fathom how the dollar won't exist and it'll be used for day to day currency. And that's like a microcosm of what we're talking about. They can't make the leap functionally from limited world that uses dollars to saying this thing has some value. But then people will over time increasingly want it and they wouldn't ask for their goods or services in it. It's a logical regression. If it's worth something, it's worth everything.

[Jackson]

My, my, the thing I, I struggle with currently is I don't think that most people understand what you just said until it's too late in the sense of inflate. Like people don't understand inflation until they experience it for the most part.

[Brian]

Right.

[Jackson]

And so I think the, the pain is the best teacher in this case. And Michael, what would be the impetus for you?

[Michael]

Because I thought about it deeply. So like I think the way that this works is. And what's bullish and. And it's kind of fun that we're sitting here at 50, 60. We have a lot of stuff. You're seeing Baltunas. Talk about back to the basics. Like, Lynn Alden also had that. That tweet that I think was very prescient of, like, there's nothing coming to save Bitcoin. There's literally just people that are building a floor, understanding it's the best form of money, deciding to park more of their wealth into it, realizing that over time it's going to go up and preserve their wealth. And they're not thinking about a monthly dividend or even an annual dividend. They're okay because they've parked this amount of capital to preserve their family's wealth. And they did the work. We're so far from that. And to your point, the way it'll work is that people will come in via speculative assets. They'll come in via different ways that everyone listening. And even our own experience where we allocated something, and then it increased the confidence and conviction. Sometimes it was right off the bat, other times you had to get burned. But every floor embeds more education. That thing not dying, as Brian talked about earlier, allows for more people to park more and more of their wealth. All those things will happen until you hit a natural tipping point. It'll converge around multiple things. It'll converge around AI and just computers and technology using it. It'll converge around the price appreciation and the realization of all the things we just talked about. And you're growing into understanding. And then it'll converge around inflation and the market around those three things will provide that 3 to 5% like construct of once those people are using it. Nobody thinks about buying a cell phone. Nobody thinks about using the Internet. Like, it'll just be the thing that stores your wealth in the digital age. Everyone won't go down the journey. You're just going to need a certain penetration. And the estimate's like roughly 3 to 5%.

[Jackson]

Yeah. I think between those three, those three factors make sense. Um, do you have any. You have any timeline in mind? And when you think that 3 to 5% materializes. I'm serious. Like, just. I'm just curious. Based on building in the space for

[Michael]

a while now, I think that you end up. It's all a confluence of things. There's no one silver bullet. But as you see more we talked about on Final Settlement, Cloudflare, and a lot of the different tooling online that will start to become ubiquitous around micropayments for better usage of online experience. You're going to just start to see a bifurcation of or like a like symbiotic relationship between dollars and sats. Like light sparks the closest or sparks the closest. Doing this where you won't even know what's in your wallet. You'll buy it. You'll think you're buying dollars. It's sitting on SATs. You'll move it. You see what Cash App is doing. So that will just naturally progress as technology progresses and it needs micropayments embedded into it. Inflation is already we. I keep saying it's the event horizon past 2020, everyone. That's like feeling it. They feel it.

[Jackson]

They just.

[Michael]

Nobody talks about it. Nobody's invested. All these firms are invested to talk about it. But that's what Vanguard and Fidelity and all these firms doing it like, that's crazy. I think Fidelity recently. I forgot what the. What was the title of the report. They put out a quick. It was. Oh, so Fidelity had put a quick video explainer around. It's not the home getting more expensive. It's the purchasing power to losing like a year ago. They couldn't have done that 10 years ago. They definitely couldn't have. But the point is larger and larger firms and now can say this, start to educate the market when they weren't incentivized to talk about bonds and equities. The equity market will eventually do whatever rolling over the. The dislocation. The math is the math. So even if you're just going into passive indexes, it's not keeping up with inflation anymore in real terms. So all those things are just happening. They will accelerate. But yeah, there's no I. So going back to your question, I don't necessarily have an answer, but I don't think these things can all persist.

[Jackson]

Yeah, the second point is interesting, right? And it ties it back into what we started the show on. Because at the end of the day, the incentives dictate what a firm is willing to say and then what they're willing to sell. And so most Wall street firms would not have been in a position to talk about your home not appreciating the dollars losing value 10 or 20 years ago. If they're trying to sell you on a portfolio of bonds, it's clearly losing purchasing power over time. But if they are trying to sell you on other assets, equities, depending on how you think about it, is either at this point keeping pace with inflation or marginally outperforming and then you have bitcoin which outperforms, I would say debasement over time. And there's other real assets that you could probably own as well. But at the end of the day, as these firms are positioned to sell the product, then they're going to change the narratives. They're going to put out research that will then support the product. So I think I didn't actually catch that piece from Fidelity. It's interesting that you mentioned.

[Michael]

Yeah, and I talked about this this past week on Final Settlement and it ties directly into it in the sense of. So I was at Google Fiber, it was a startup within Google and the core idea was that there was a lot of the large fangs at the time, I don't think it was called fangs, but that needed the bandwidth to increase so their business models could grow. Because if you think about the amount of throughput for YouTube as an example. But other things that were going to come, the existing incumbents which were Time Warner and Spec and or Spectrum, I think it was Time Warner and AT&T their capital expenditures, they had a monopoly or a duopoly on the United States from Internet and they only invested 2% total like revenue from a capex perspective. So they invested nothing. So everyone was getting two to three, four megabytes. And if you think about you need in a large firm and then other firms that had this. So they went in on a whole spree on educating wide bandwidth, you know, low income housing, all these things to get the market in their favor. But think about how many different industries that it completely disintermediated or evaporated because once you're able to pipe that through, when you think about like Netflix as an example and Blockbuster or just other YouTube as YouTube's grown, that can only exist as legacy firms and firms with capital can change that narrative. And so I tie it back into the open USD stuff because the notion of the largest firms in the world, the visas, the coinbase, other businesses digitizing the dollar effectively like open sourcing that dollar so anybody can get online and have access to the dollar. Because we know a dollar to BTC switches like this, it's just an atomic swap. There's you know, maybe KYC depending on who you use. The point being is that money is becoming digitized and everything online will flow through a layer that doesn't require the old legacy rails that this is happening faster than anybody expects. And these are the largest firms and as they start to do it they're going to have every reason to educate the market on why you want to put your capital in a digital way. And then part of firms will be educated on why you want to go from dollars to btc. And then the market will just register that as well. Just based on the tooling of Bitcoin being interoperable to anything versus what a stable coin can do.

[Jackson]

Yeah, makes sense. This supports what you're just describing as well. Pulling this up from Matt Hogan and he's referencing that he read a recent speech from Treasury Secretary Scott Bessant and says it lays out a new and defining vision for America's role in the economy for the next hundred years. He organizes his vision around five principles. Principle three is America will write the rules of the next economy. And he gives one example of what this means. Digital assets, stablecoins, tokenization and new payment systems will help shape the future of money. The United States should not co sign itself to the sidelines while that future is built elsewhere. So I think it directly supports, Michael, what you were just describing on the open USD side, you're talking about different fintechs, payment providers, et cetera. They're aligning the incentives to start selling a product. But at the same time, you have the United States, which has had hegemony for call it 80, 100 years now at this point, and they want to maintain that into the future. And we, if we know anything about money and having studied monetary history and policy, everything kind of points back to how do you stay relevant, how do you stay at the bedrock or the center of the financial system. And so it kind of supports what you've described or certainly supports what you've described here, where you have the administration having this strong stance in favor of these technologies and acknowledging that these are going to be ways to just get more dollars into more people's pockets in all corners of the globe.

[Michael]

Yeah, it's going to be more ways to inflate people's also capital. So there's a way you can hold two sides in your head of saying stablecoins are insanely bullish for Bitcoin while also saying that the rational thing is people will come to the conclusion that you don't want to hold the stable coin, you want to go to Bitcoin. But you just shared what's embedded in that is you need the regulatory overhead or climate to be clear because most of these firms that wanted to touch the space would not touch it because of the overhang that existed from prior administrations, prior bureaucracy, et cetera, et cetera. And so by providing this clarity, no pun intended the genius act. And you have people like Bessant and others that are coming out and obviously they have their perverse incentives because you get dollar treasury demand further out into the globe. More tokenization where people in all over the world can buy shares of Apple stock trading at whatever multiples that furthers our capital markets. But that also gets people understanding the digital finance. And then bitcoin sits right next to that. There's gonna be entrepreneurs that put those two together. And then that's our basis of like, who's gonna win is over time, people realize, I just want to hold this thing that is neutral. And it goes back to all the subjective and objective properties we talked about of what people value and what they want in their money.

[Jackson]

Yeah.

[Michael]

The one thing that you guys were talking about, and this is just an aside, we don't have to talk about it, but like, it's always foreign to me how people don't reconcile how bitcoin has some value. Because I was always interested in cards growing up, and there was something scarcity around cards. And so the second I heard There was only 21 million Bitcoin and it was worth what it was worth in 17, it's like, well, there has to be some value to it. If it's already gotten to thousands of dollars and there's only 21 million now, it's just underwriting, well, what's the value? And that's why the bitcoin standard, I think, is like the godfather of books, because it's formidable and explaining. Forget about bitcoin. You have to understand what lived before it. And gold lived as that standard because of its properties. And then bitcoin perfected them. And that's always just like kind of been a little interesting how people can't reconcile two parts. One is, does bitcoin have any value because of the scarcity component? And humans are just driven around scarcity. But then the other side of it is like, how could bitcoin not be global money? Because gold is global money. And we've kind of lived in this weird world since we fell off of that.

[Brian]

Yeah, I mean, I think there's a number of factors that are headwinds to understanding what you just described. The first is effectively, you know, people don't have that. They, most people don't know that there's only 21 million. And even if they get that far, the. The barrier is then, well, how do I know that this is true? Like some guy, Satoshi created this and you're. And these people are telling me that there's 21 million. But how do I know that's true? There's all these other cryptocurrencies. So it is, it's an arduous path to like understand why that is true. And I think that that's generally the rub.

[Michael]

Like, can I comment on that real quick?

[Brian]

Yeah, yeah.

[Michael]

So that's a. I'd be generally curious, like, how you think about that, because I think that's the, it goes back to the notion when somebody has an object. Objection. It's never the first objection. It's what's behind it. And when somebody says, how can that be true? I think of like, just my own way to, to acknowledge how can that be true? And maybe this is a lapse on my judgment, but it's like, how can I know that restaurant's food is not poisoned? Or how can I know this Uber is not going to kill me? It's like, well, people got in the Uber before. People went to the restaurant before. And if all these people are looking at this thing that are much smarter than me and they have a more technical component to be able to understand 21 million, it was almost like, well, then, then it's true. Obviously you have to learn more about consensus and stuff. But in my view, people that say, how can it be true? Are just looking for a reason. Because again, as.

[Brian]

No, I mean, I agree with that, that it's, it's its behavioral tendencies and biases that lead them to that, to that rationalization. And it's because they haven't done the work. Maybe they don't have the technical expertise to understand consensus and a decentralized piece of software that they could verify for themselves that it's, it's 21 million and unchanging. And so, you know, what they need is to some extent social proof of other people that they respect believing it or they need to go down the path themselves and actually understand why it is true. But you're right in that it's a, it's a knee jerk behavioral reaction to something they don't understand to say, you know, I don't trust it. I don't believe that to be true. Basically,

[Michael]

it's like quanto.

[Brian]

Yeah, basically.

[Jackson]

Ryan, can we talk about this piece that you shared with me? I'll pull it up.

[Brian]

Let's do it.

[Jackson]

Is this country having its socialist moment? Big question. Brian Cabellis is going to answer it right now. On the last trade.

[Brian]

Well, I pulled this out because I think last week, Michael, you asked me as a former New York resident, why mamdani won and why there's all this momentum on the socialist side. And I didn't think I had actually a great answer, but I think this piece from the Mises Institute did a better job than I did of, of explaining why we're seeing this move. And, and basically that the core takeaway is that it's not. It's not that there's some newfound resurgence or belief in the actual ideas of socialism. It's that the, basically the existing status quo of, like this, you know, quasi capitalist democracy that we live in, people are. Are poking holes in basically the inequality that has resulted from the status quo and the existing system. So they're basically creating this false binary of if this, you know, proverbial democratic capitalist society created all this inequity and isn't working, then the only other alternative is socialism. And instead of the, you know, the elites or the few reaping all the benefits of the existing system, we need to redirect those benefits to us, basically. And so it's creating this false binary of, well, if this isn't working, then it has to be this other thing, socialism, which redirects that redirects the spoils to me, basically. And if you scroll down, Jackson, there's some good lines in here just in terms of, like, why this doesn't make sense based on sort of Austrian ideals. If you go up, go back up a little bit. But there's just an example here. For example, consider this. Would it be. Would it make more sense to build a bridge out of steel or platinum? The question sounds absurd to us, but only because we know platinum is way more expensive than steel. And so the point being made here is like, you need a free market. You need price signals in order to even attempt to centrally plan something. So the ideas of. Or the tenets of socialism, that we're going to centralize all these things and, you know, fix prices and, you know, create free housing and free buses. It's like, well, you actually need the free market price signals in order to even have a chance at doing any amount of central planning in an effective way. And so it falls down. It falls apart from, like, first principles. If you think through, you know, how these things might work on paper versus how they actually play out in practice. And so that, yeah, the first half of this is sort of explaining why that is, and the second half explains why it's not really like people believing these things. It's. It's basically the popularization of just, here's the alternative to like, the status quo isn't working, so we need something else. Yeah.

[Michael]

Do you want me to go ahead.

[Jackson]

My. My thoughts on it. So the. It's titled, right. Is this country having its socialist MO Moment? I think this chart here, ever since I saw this, this was published in the Wall Street Journal couple. Oh, here we go. March 24th. It's titled They're Rich but not famous and they're suddenly everywhere. And this chart here of real growth of household wealth since January of 1976. You can see that it's worth looking on the video, but the top.0001%. The top.001%.0.1% top 1% in all households. You can see the. Their real growth of wealth over the past call it 50 or so years. And I think this chart perfectly describes where we're at in terms of a. This is almost perfectly where the Fiat standard started 1971. This data is from 1976. And as we know, the Cantillon Effect is real and it concentrates all the wealth and power at the very top of the economy. And so I think this is the best chart that I've seen to date that describes why the socialist moment is here. You can imagine. If you don't understand anything that we're talking about, I can certainly understand why people are grasping onto like we just need to take all this money away from all the rich people who have exploited this capitalist system. But when you dig deeper, it's really the fundamental problem is that we just have infinite money printing and it's all concentrating at the very top of the economy. And so I don't know, I think this trend is going to get worse because I don't necessarily see an end of the fiat system, at least anytime soon. And so there's going to just be more wealth concentration. And I think the rational response by these people, because they are misinformed and ignorant to what's actually happening is naturally they want to attack these people who they perceive are the evil. You know, these are evil people that are taking away my future prosperity and my hopes and dreams from me.

[Michael]

Yeah, it's well said. I mean that chart's perfect to encapsulate what we're talking about. I think there's a couple core things to call out. One of them is it's. I've understood this for a long time. It's kind of. It's going to influence a lot. Any decision I made. It's like it has to get a lot worse before it get. Gets a lot better. It's. It just, it's just a function. Like you said the same thing, Jackson, around where we're headed. But there's two aspects. One is it's not just coalescing around the top. It's moving from the bottom to the top because of debasement, because a lot of the bottom doesn't necessarily know. You can think about people living paycheck to paycheck or people parking in 401ks that aren't keeping up in real with real inflation, or people that go into these other speculative assets that they think are increasing or they, they go into it because they naturally feel that they need to get ahead, so they go out to speculate. So that causes that further divide. And then there's naturally because of that and the pro, the, the, the machine. That's where people don't come up with these opinions by themselves. When you tune into CNN and all these other things, you just hear all this propaganda that's out there about like the wealth inequality or the wealth and this tied into. I brought this also up. I don't know if. So BPI put out a report called Foreign Influence in the Campaign Against American AI. And it's this guy, Sam Lyman, who recently was with Riot and then worked, I believe as a, as a writer for. I think the Treasury. Point being is he went back and traced a lot of the influence not only on AI in the data centers, but also back to a lot of these socialist movements. And it comes like via different groups. A lot of them are like CCP funded. And so you just have these like little pockets that are able to start to grow and start these movements, they're well funded and they're at the right time because you have so many people that are looking for answers. And what to your point is the best answer then? Like, let's take the money away from others and let's disperse it through. Through everyone else. And so there's no solution to this. Like the, the only solution is to protect yourself, protect your family, protect local areas, you know, be in regions that are. I think it comes almost everywhere. But you don't want to be in these core hot spots right now that are just being completely rantech. Think of California, New York as an example. Um, but yeah, there, there's there's no real solution outside of just protecting your own capital.

[Jackson]

Yeah, and it really is. I can't remember if we said this on the show previously or if I was just writing about it online, but it really is insidious. Right. Because at the end of the day, that debasement which has led to those outcomes in terms of wealth concentration has effectively left certainly the bottom 50% behind in the U.S. economy. But you could argue up to like the top, the bottom 90% and it's really benefited the top 10%. And now the most, the insidious part about that is, okay, well now we've already destroyed like 90% of the base of the country and now we're going to go after like the top 10 to 1% and we're going to use these bottom 90% of people who we already destroyed, we're going to get them angry and we're going to use them to attack the top 10 to 1% that have benefited from this system. And we're going to try to extract as much of the wealth from them as possible into the coffers of the state. And we all know once it's in the coffers of the state, it just pads the pockets of politicians and it just leads to more corruption and exacerbates the problem. So yeah, I mean, I wouldn't be surprised. Michael, to your point, I don't, I would certainly my base case is that things would get worse. I think we're going to see more of this socialist movement in this country for the foreseeable future.

[Michael]

And just to contextualize, like this is the other side of the finance spectrum because we usually don't talk about like the social constructs or like the downstream effects, but it's the same idea around the financial aspect where like that top 10% could hold a basket or portfolio of assets, but those assets are not immune from all that money, money and liquidity sloshing around. And that's where we've seen it's harder to outperform, you know, passive index. Obviously like talk about passive and real versus nominal returns that people are feeling it on that side, but they don't rationally come to the conclusion because in dollar terms it's increasing that, oh, I'm speculating versus saving. And so that maybe it takes a little longer or maybe it comes out in a different way, but you're also putting yourself at risk if you're in these assets that are part of like this liquidity cycle that fundamentally don't have any intrinsic, quote, unquote, intrinsic value. I'm not going to use that, but just long term fundamentals because it's the same and that's why we keep going back and it's like underpinning. I won't, I won't use the words or the products, but that's why? There's just a lot of products out there that put you in these assets that aren't protecting you from this liquidity crunch. Because that neutral asset and all the things that Bill Miller talks about and we talk about here, what make Bitcoin valuable, that even at a retracement you still own your wealth. You're not tied into this thing that's over lever. And that discount is fundamentally like what is a big part of what misprices Bitcoin.

[Jackson]

So we're going to be touching on it a little bit later in the episode, but there's been some pretty significant data breaches in this Bitcoin and crypto space the past seven years. We're going to talk about the numbers, but it's roughly 30 million records that have been leaked across dozens of different companies. And it really underscores a lot of the work that we're doing here at onramp. I'm curious, Michael, just what your thoughts are before you at the listener get more information toward the end of the episode.

[Michael]

Yeah, definitely. I mean I think you've personally gotten the ledger notice in the mail and then me being, you know, public and then also just have buying these products. I've gotten insane text messages, calls, phones. So that's how I think about knowing that I can mess up horribly, whether it's with AI and the tooling on my computer or phone, but that my Bitcoin sits in multi institution custody offline. But I think, yeah, it's going to be an important, you know, segment to listen to as it relates to all the different data breaches, including the most recent one that happened this morning.

[Brian]

Yeah, it's only, it's only going to accelerate and I too can speak to. You know, I'm a former employee of Coinbase, so I don't know if that has something to do with it, but I get dozens of spam calls and texts on a regular basis. So if it's not out there already, your data will be leaked. And so to your point, Michael points to the merit and the value of protecting data, particularly data that secures your wealth in the form of Bitcoin.

[Jackson]

Yeah, it is unnerving. I get the physical mail from time to time from ledger impersonator. So I would say if anyone is curious about what we do and how that can protect you against these different types of threat vectors, digital, physical, protecting yourself from human error, making sure your family can access use code TLT when you book a consultation or sign up on our website. Consultation link will be below and Love to speak to you, answer your questions, tell you more about how this works,

[Michael]

and if for nothing, do it for your wife. I've gotten plenty of calls and references that once the coinbase leak came out, they didn't want their wife to start getting the spam calls and wonder what they got themselves into. So book a consult. It could save a marriage.

[Jackson]

All right, if we want to stay on some of these social topics, there's a few others that we had on the list here today. So where is it?

[Brian]

Here we go.

[Jackson]

So gambling disorder cases have started to skyrocket in states where sports betting is legal, which started in May of 2018 following the end of COVID The states where it's remained illegal has essentially flatlined in terms of these gambling disorders. So you can see here the chart where it was never made legal. It's actually gone down since 2018, where as diagnosis of gambling disorders in states where it has been legalized has effectively doubled and call it six years or so. And so I think it's like a barbell, right, where you have a number of people who. It may be a lot of the same people, where you have people that are just frustrated and they're gravitating toward the socialist movement because the fiat system has just totally obliterated them. And then some of those same people may be different people have chosen a different way to cope with it. Where you see things like gambling disorders, prediction markets, all these things are just tying back into the idea where it's like you. There's seemingly no way to get ahead. And so this is just very problematic. It's not, you know, it's really not where we want things to head, but it's kind of the inevitable path that we're on as long as debasement continues.

[Brian]

Yeah, my. My takeaway from that chart is

[Michael]

a

[Brian]

little bit adjacent to it, but it's like the power of. It's like the power of UX UI and like, ease of access. Because the reality is like, you know, you could always gamble, like, you could find a bookie to play sports bets, even if it wasn't legal in your state. But now that it's like, you know, so easily accessible and legal, you see that top line sort of skyrocketing because it's just, you know, it's on Robinhood, it's on kelshi, it's on DraftKings, it's on, you know, all these different platforms, and it's being pushed to you. The ads are insane. And so it's like that, that Just like ux, you solve the UX problem and then, you know, it, it explodes. It's just kind of fascinating because you could always gamble if you, if you really wanted to.

[Michael]

I'll get a lot of shit for it. But it's like this stuff reminds me of. This is just the poor man's gambling and the rich man's gambling is the stock market.

[Brian]

Um, right.

[Michael]

You know. Cause like it's, it's, it's kind of like the thing that you needed first to get embedded in the Robin Hood ification, the Wall street bets and that everyone does it and that's how we save. So we must be in like, you know, some people end up ahead if you can find the microns or whatever. But the amount of people that can really do that at scale and your 50, 50 odds of staying used to be the index, but now those aren't. So you're, you're gambling with your money. It's on the other side, but it's normalized. And I think like I'm just calling this out because this is embedded. And I think a lot of the sentiment that we've talked about other products is that like there's just this thing that savings and everything else is speculating gambling. And I think everyone's fair to do whatever they want. I think most people just don't recognize that that's what they're doing and, and that's okay. And the beauty is like where it's really, you know, I've always known this, but this past week thinking and for our team is like, the goal of the business is to build a long term wealth preservation machine for people and that version is to be conservative and then articulate Bitcoin's value prophet over time, allow them to preserve more of their capital and then provide that. And the right people have found us. And then over time we believe as long as we're right, that's what makes a market. More people will find you there because you are the ones. This is where that podcast around the inference stuff is really good because there was years he was trying to build this, this way to build a chip that could provide faster inference and nobody understood why. And now it's the thing that everyone knows that they need. That's the part of like you just gotta look a little crazy for a little bit. But anyway, so I think that's like just the core point. It's that the whole world is telling you you should be gambling when we're just saying you should just be saving.

[Brian]

Yeah. The other Thing that relates to this is like I don't have the exact numbers. Cause I haven't looked at it in a while. But like the percentage or the amount of like active investors so like professional investors who can outperform the index is like small. And like has been shrinking over the past 20 years. So it's like there's this idea or perception that, yeah, like you invest in the stock market, that's how you preserve wealth, that's how you save. But like the reality is most people can't pick stocks better than just investing in the index. Even the professionals can't.

[Michael]

It's such a. It's such a great point. Like this is a great chart. If you could just picture in your mind like there's a house like your. The casino and your percentage like in the 70s, or call it 80s was 50, 50. And then they started to insert like in that decade more. Either reduce the oxygen or just insert more liquor into like number of drinks that you had to drink to play. And you're reduced in your performance. And on the other side of that you show the equity market and then you show the amount of liquidity that gets inserted and then your performance. Because that's the thing that a lot of these people is. Well, like it's frustrating when you listen all in because a lot of those guys are super smart from a business perspective, but they lack the fundamental just acknowledgement that the dollar is broken and liquidity broken. So that misaligns or pushes incentives and capital in these ways that they couldn't foresee. And so they lack that version. And that's what you're talking about with the professional investors that they can have all. And you hear this a lot, right, with a lot of the value investors that they just step out of that game because they're like between the Algos and Fly and between the Algos and fixed index funds, they cannot keep up and there's no reason for them to exist versus just put that capital in there. There's no active management necessary. And I think most people just lack that fundamental understanding.

[Jackson]

Well, they're not incentivized, to be honest. People either. Like they have literally, I will say Free.

[Brian]

Freeberg. Friedberg understands the dollar's cooked. He just doesn't. I don't think he knows that bitcoin's a solution. Jackson, can you reach. Can we get Freeberg on the show? You reach out to him?

[Jackson]

Yeah, that'd be cool. I. I don't know. I just take an issue, not necessarily with him, but I Take an issue with the other ones in particular, Chamath. And what's the other guy sacks like? They're just such big rifters. They're definitely not honest people. You don't get into these positions in the White House by being an honest person. Yeah. And then you also don't, you know, you're not an honest person if you're rugging people on specs and ICOs at the top. So I don't know, I can't get over that. Can't forgive them for that.

[Michael]

Yeah, they're definitely opportunists. They're definitely opportunists.

[Jackson]

How about this one? And then we can wrap up here soon. This was I guess of the past week or so, but this is on the topic of permanent underclass which I would identify as part of that favorite topic. So this is about Apple's consumer products increasing in price overnight. So 10 to 50%. And this one I think was a little bit of a shock to people because we're used to consumer tech. Products have typically gone down or at least remained pretty stable in prices while you continue to get more and more for your money, which is the natural order of technology is deflation of course. But then overnight for the iPads, the MacBooks, Mac minis, the desktops, et cetera, Apple TV even these things went up like 15, 50% overnight. And then you have the, I think the iPhone suite is going to get the price increase in the fall, I believe. And so this one I think was surprising to people again just because we're used to at least technology being somewhat insulated from these 10, 15% year over year price increases. But now it's finally starting to roost where it previously had not. I'm curious if you guys have any thoughts on this. And then the other, you know, the other aspect of this as well is that the best products and the best intelligence has, it says in this post here will kind of gravitate toward those that have the means financially to pay for those. So whether it's Fable 5 with anthropic or whether it's just like the latest and greatest of the Apple products, we're going to continue to see this divergence in terms of what products most people can buy versus let's say the top, you know, 10, 1%.

[Michael]

Yeah, I mean so this is the nuance that gets lost or trapped is that's all true and we're going to see this, I mean there's a, there's a proxy for liquidity, the data center build out proliferation of AI more dollars provides a constraint or demand constraint on more memory, increase in pricing. Like that's all fair. And that's also fair that like we're probably end up in a state where the latest models get sold to hedge funds or whatever first and they get access and they can outperform and they have more intelligence to us. Like that's all the doomer true truism. I think the counter to that or the other side from a perspective is this is how it's always existed. Like there's always been upper class, lower class, there's always been serfs and that every cycle and every hundred years or whatever you know, time line you want to look at, the market gets more decentralized from the amount of asymmetric knowledge that individuals get. Whether it's like you know, the firearm and gunpowder to holding Bitcoin as its thing or the notion that you can have are intelligence on your phone and a smartphone or a laptop. And so is that proliferates and grows. You end up with more people with more access to intelligence or being able to manage and hold their wealth than ever before. And as we know, constraints breed all the creativity. So when you end up with those individuals that have the things, I would still, from an entrepreneurial perspective take the other side of that because those constraints will come out with more innovative things. So it'll look weird to start, but the other side of it because we look at a lot of these things from a western lens, but it came up with, I think it's GLM 5.2 that is at the level, if you get it right, to compete with like latest Claude or 4, 8. And the example was somebody was able to duct tape two PS2s together and able to run it on there. I think maybe it was a different model. But the core idea is that PS2s exist everywhere on the globe, right? It doesn't matter where you're at and that you can go buy that second hand hardware. It obviously takes some time, but you're going to be able to run this stuff. And what does that look like in a world where everyone has that and then now people that are much smarter that never had the opportunity, you end up in a better world either.

[Brian]

Yeah, I don't have much to add. I hadn't seen that though. It's interesting though that the, the iPhone was not on that list. So I guess they, they just didn't raise the price on that for whatever reason.

[Jackson]

It's coming in the fall. But yeah, I don't know why. I don't know why it wasn't overnight. So yeah, if you need a new phone, buy one now. Escape the permanent honor class. Load up on iPhones, sell them secondhand.

[Michael]

Hoard your.

[Brian]

Hoard your iPhones now.

[Michael]

Yeah, I mean, but this is like, it's a proxy for Bitcoin in the sense of like it's the same idea. You want to get your hardware. I'm not going to talk about what, but I was buying stuff a few months ago when the Open Claw deal came out because I was like this is fucking going to get crazy because everyone's going to realize they need, they want to host or like manage this and it's only going to get that way. So when you think about like Nvidia Sparks and all the stuff to be able to manage as a company or whatever, your own data, like it's only going to get more expensive. So anybody that's thinking about any of this stuff, if you want to, you should be buying, including the MacBooks. Because I expect what's going to happen is these prices are going to increase and they're not even going to be available. So the MacBook will increase and there's going to be like demand destruction because the price will increase, but there won't be or there won't be. It'll be the opposite of demand destruction. Like there won't be enough of them because there's just like resource constraints on the inputs to build a lot of this stuff because you've never had the demand for like memory is the big thing. You need to be able to like control that environment locally and for it to persist that context window. And we've never had the need for that at this scale. And if every person, every company, every individual is going to need that, that's where you end up. And the market will sort itself out. But I think it's going to be a while. This is, I don't think this, this AI stuff bubble from a capital markets is one thing, but just from proliferation and usage and tokens we're like, I don't even think we're at the parking lot of the ball game.

[Jackson]

Like it hasn't even started. Should we wrap up on this one, Michael? This is something you flagged.

[Michael]

Yeah, this was really interesting. I wanted to post something out. So MVK had posted this a while ago and it was, it's a, it's a good like content marketing, right? Because he deletes all of his data. But this was going through effectively everyone in this space in a timeline and sequencing from 2019 to 2026 of data breaches. So he's saying 32 million direct affected crypto companies, a billion from KYC provider. And he's talking about, you know, obviously competitors to start ledger. You know, this is why people, if you're listening, get these, you know, letters in the mail. So he includes just all the different links. We should include this. So anybody kind of knows Trezor. I think there's like, you know, bitcoin companies in here, crypto companies. But I think this just gets lost that amount like everyone's data is out there. I think it was on earlier that somebody. It's like a million or billion. I don't even know the number of driver's license were leaked just now from some third party. So yeah, it's, it's not good.

[Jackson]

Yeah, this says 29 breaches tracked. And VK also says it took about five minutes of research with Claude just to dig all this up. So. AI yeah, it's, it's a little bit helpful for a number of different reasons. But this is just summarizing. We can put in the description or the show notes, but leaked your data. 29 breaches, 31 plus million records over the past seven years. And to Michael's point, it's been a lot of different players in the space. So yeah, I mean do what you can to get things airtight. But my driver's license is out there. I actually got my passport stolen once before in Barcelona. So someone out there has my passport, probably has come to the US Might even, you know, I might not even be the host of the last trade next week. Might, might get an impersonator. So we'll see what happens. What do we think? Anything else before we pull this up here?

[Michael]

Can you pull this up real quick because this, this didn't.

[Jackson]

Where are you sending it?

[Michael]

Right here in this chat. There's some reason they ad blockered in and bring it up because it's just published like a few minutes ago. It was a data breach exposed millions of driver's license numbers. I don't know if it was Cal. California. So if you're in California. Yeah, another massive data breach. So this came out this morning. I don't know why if that's just us. Insurance provider Assurance America has confirmed data breach affecting. So this one's 7 million. That's not good.

[Jackson]

So are we going to show up next week on the last trade we

[Michael]

didn't get to chat about open USD. But that's okay. We talked a little bit about it. So I feel like that's a bigger deal than but it's all right. Nobody cares.

[Jackson]

That's a final settlement topic. Apparently that's everyone's favorite show. Anyway, I do want people to let let me know in the comments, get a sound off. Let us know what you like, what you don't like, and if you can leave a like and if you could subscribe, then I won't leave for Vanguard and I'll show up for the rest of the year.

[Michael]

Are you still providing a free shirt if somebody Are you shipping somebody a shirt if they use a certain code?

[Jackson]

Or I will send you the shirt off of my back, the shirt that I'm wearing right now in the mail. I won't wash it if you use the code TLT when you book a consultation, you can speak with Michael or myself. But yeah, we got some other stuff cooking up for next week and any other parting comments from Brian or Michael.

[Brian]

I think that does it. Good rip, fellas.

[Michael]

Good stuff, guys.

[Brian]

Thanks for listening to this week's episode of the show. If you found the information valuable, please share the episode with a friend or leave a rating on your favorite podcast. Appreciate all the links we discussed in today's show will be in the show Notes inside your podcast app. Before we finish, a quick reminder that On Ramp Media is for informational and entertainment purposes only and nothing should be construed as investment or legal advice. Regardless of where you are on your Bitcoin journey, we'd love to hear from you. Visit onrampbitcoin.com contact to schedule a consultation with one of our private client advisors.