Summary of "The Bitcoin Bull Bull Bull with Michael Saylor - WBD269" on The Peter McCormack Show

Release Date: October 14, 2020
Host: Peter McCormack
Guest: Michael Saylor

In this in-depth two-hour interview, Peter McCormack engages with Michael Saylor, the CEO of MicroStrategy and a prominent Bitcoin evangelist, to discuss Bitcoin's role as a transformative financial asset. The conversation delves into Bitcoin's value proposition, its comparison to traditional assets like gold, the challenges and opportunities for institutional investors, and the broader implications for global financial systems.

1. Bitcoin's Value Proposition and the Size of the Opportunity

Michael Saylor begins by positioning Bitcoin as the ideal treasury reserve asset, emphasizing its scarce and immutable nature. He articulates that Bitcoin offers a "perfectly scarce asset" with a fixed supply of 21 million coins, contrasting it with assets prone to inflation like fiat currencies and even gold.

Michael Saylor [03:54]: "Bitcoin is a digital gold and it achieves what gold bugs wanted to achieve. It creates a perfectly scarce asset. There is no inflation to speak of."

Saylor argues that Bitcoin's limited supply ensures that its value remains intact over time, making it superior to gold, which he claims is subject to significant value erosion due to counterparty risks and inflation.

2. Bitcoin as Digital Gold – Why and How

A significant portion of the discussion revolves around Bitcoin's comparison to gold. Saylor elaborates on why Bitcoin earns the title of "digital gold," highlighting its technological advantages and antifragility.

Michael Saylor [10:46]: "Bitcoin is virtual gold... it’s not going to be the same for the next hundred years. It’s going to literally get harder, more secure in many ways as the software and the hardware gets better."

He underscores Bitcoin's ability to adapt and strengthen through technological advancements, unlike gold, which remains static. This dynamic growth potential positions Bitcoin as a more resilient and future-proof store of value.

3. Investment Approaches and Barriers for Institutional Investors

When discussing institutional investment, Saylor identifies several barriers hindering widespread adoption of Bitcoin among large investors and corporations. Key obstacles include reputation issues, volatility concerns, and regulatory uncertainties.

Michael Saylor [24:44]: "Number one, reputation. The mainstream media characterizes it as casino gambling... That will scare away institutional investors."

He suggests that rebranding Bitcoin as a "crypto vault" or "the world's safest savings and loan" could mitigate negative perceptions and attract more institutional capital.

4. Bitcoin vs. Other Cryptocurrencies and Market Narratives

Saylor addresses the fragmentation within the cryptocurrency market, critiquing the focus on altcoins over Bitcoin. He advocates for distinguishing Bitcoin from other cryptos by categorizing them into distinct sectors such as stablecoins, application networks, and digital assets.

Michael Saylor [37:39]: "The crypto pond is $300 billion and Bitcoin is $200 billion of it... if you're smart, what they would do is say what the lightning network is doing. We're going to make Bitcoin better."

He emphasizes Bitcoin's dominance and robustness compared to other cryptocurrencies, arguing that Bitcoin's established network and maximalist support make it the premier choice for both individual and institutional investors.

5. Bitcoin as an Asset vs. a Currency

A critical segment of the interview delves into the debate over Bitcoin's primary function—whether it should serve as a currency or as a store of value (asset). Saylor strongly advocates for Bitcoin as a long-term investment asset rather than a medium of exchange.

Michael Saylor [70:50]: "I think, I think bitcoin is a crypto asset and you put it on your treasury, on your balance sheet and you hold it and when you need money, you take it out and convert it to fiat."

He argues that using Bitcoin as a transactional currency introduces complexities, especially regarding taxation and accounting, which make it less practical for everyday use compared to its role as a store of value.

6. Bitcoin and Government Interaction

Saylor touches upon the relationship between Bitcoin and government regulations. While he acknowledges the need for certain governmental functions, he cautions against Bitcoin being associated with anti-government sentiments, which could jeopardize its adoption and legitimacy.

Michael Saylor [88:56]: "I think that to the extent that bitcoin gets affiliated with hostility toward local governments, that's not going to be good for Bitcoin."

He advocates for focusing on Bitcoin's ability to provide financial sovereignty and security without directly opposing governmental structures, thereby fostering broader acceptance.

7. Elevator Pitch for Bitcoin

Towards the end of the interview, Saylor delivers a concise and compelling elevator pitch for Bitcoin, highlighting its advantages in the current macroeconomic environment dominated by monetary expansion and inflation.

Michael Saylor [97:36]: "Bitcoin has the highest real yield because you can't make any more of it. All the other investments are crowded trades. Bitcoin has an asymmetric proposition. You can get an edge here because it has a history which has scared some people away."

He encourages investors to consider Bitcoin's potential to serve as a hedge against inflation and its growing acceptance as a legitimate financial asset amidst traditional markets' vulnerabilities.

8. Conclusion and Resources

In closing, Saylor directs listeners to various resources for further education and engagement with Bitcoin:

• Twitter: Follow Michael Saylor on Twitter (@michaelsaylor)
• MicroStrategy Website: microstrategy.com – Explore MicroStrategy's Bitcoin initiatives and resources.
• Educational Foundation: saylor.org – Access free educational materials and programs offered by Saylor's foundation.

Michael Saylor [101:07]: "And if you're interested in free education or, you know, anybody that wants a free college degree, go to sailor.org we're trying to give it away."

Notable Quotes

• On Bitcoin as Digital Gold:

  "Bitcoin is a digital gold and it achieves what gold bugs wanted to achieve. It creates a perfectly scarce asset." (03:54)

• On Rebranding Bitcoin for Institutions:

  "If the narrative was it's a vault of encrypted energy, it's a crypto vault, or it's the world's safest savings and loan... That's an appealing narrative." (24:44)

• On Bitcoin vs. Altcoins:

  "Bitcoin is the winner of the crypto wars and has risen above the thousands of other crypto networks to be the one and only true winning crypto." (28:19)

• On Tax Implications:

  "The existing tax code is hostile to using Bitcoin as a currency." (75:36)

• Elevator Pitch:

  "Bitcoin has the highest real yield because you can't make any more of it... Bitcoin has an asymmetric proposition." (97:36)

Final Thoughts

Michael Saylor presents a robust case for Bitcoin as not just another cryptocurrency, but as a revolutionary financial asset that offers unparalleled security, scarcity, and potential for institutional adoption. His insights underscore the importance of viewing Bitcoin through the lens of long-term investment and asset preservation rather than transactional utility. This perspective aims to shift narratives within the crypto community and broader financial markets, advocating for Bitcoin's central role in the future of global finance.