← The Wolf Of All Streets
The Wolf Of All Streets
Bitcoin & Crypto Enter A "Critical Moment" As Wall Street Prepares For The Next Wave!
00:50:36
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- [00:02]
A
Bitcoin and crypto have entered a critical moment. We're speaking specifically about the Clarity act and the odds that it may actually not get approved. Matt Hogan, good friend of the show, obviously went on a long tirade on media, talking about the idea that the industry will really have to prove itself now if the Clarity act does not pass, which means we're going to have to see real adoption of stablecoins and tokenized assets and all of the promise that the crypto industry has had for a very long time. All of this is happening while Wall street continues to pour in and we're actually seeing that stablecoin adoption for payments with a majority of the companies, even the large ones in the United States, soon to be using stablecoins by the end of the year. We're going to talk about this, but more importantly, everything happening in the macro with the amazing Noel Acheson. Let's go, everybody. Let's do. Good morning, everybody, and welcome to the show. Apparently I'm broadcasting live from the Seychelles or somewhere in the Caribbean. I did not necessarily know this background was going to come up, but it's amazing. I believe that's actually an ocean, not a pool, but it has a oceanside poolside bar. Absolutely beautiful. Well, let's get into it right now with Noel. Good morning. How are you?
- [01:29]
B
Very well, thank you. Scott. I am so jealous of your background. I'm in Spain, in Madrid and it has been snowing and raining all morning.
- [01:37]
A
I think it's been snowing and raining basically everywhere all morning these. These days, it seems. So you've been on the show quite a few times, but without me. So it's really nice to get an opportunity for us to chat with you. You know, you've done an admirable job every time covering me on, on the macro Mondays, of course. So let's dig into it first. Maybe you can just give us your broad strokes on where you think we stand right now. We obviously have stock market making new all time highs seemingly every single day. Gold and silver making new all time highs every single day. The dollar making new lows every single day, which I guess is you're supposed to see all those assets going up when the dollar's going down. Meanwhile bitcoin somehow not participating in the party either way. Actually, bitcoin almost looks directly correlated to the DXY rather than inversely correlated.
- [02:28]
B
I love that way of putting it. It's also a fascinating phrase when you think about it. Where do we stand? Because standing implies something firm to stand on, which arguably we don't have these days. There's a lot going on in bitcoin and we can get into the various narratives that we can extract from its lack of reaction to the dollar's decline. But. But we have to remember that this is part of the plan. This is something that Trump said he was going to do. It's in Governor Moran's original paper, which came out in November 24, that the dollar was going lower. And what's more, they need the dollar to go lower sustainably, which even back then I think you and I had a chat about, this was going to be a colossally difficult thing to pull off because sustainable is hard in dollar drops. When things get difficult, people pile into the safe haven currency which pushes its value back up. Right. Well, it looks like they're actually pulling it off. It looks through the chaos, through the shenanigans, if you like. We are getting a sustainably lower dollar. I think it's got quite a long way to go down still. And that is part of the gold rise. Only part of it, though. It's also surprising that bitcoin, which normally moves up when the dollar is going down, is not reacting. But this is a whole lot of other things going on in bitcoin, as I said.
- [03:40]
A
I mean, you make a great point. US Dollar tanks after Trump says he isn't worried about decline. Of course he's not worried about it because to your point, this is the plan. They need a lower, they need a weaker dollar and they're getting exactly what they want.
- [03:54]
B
Yeah, exactly. When he says going great, he actually means it. This is what they want. And also when he says that he can move it up and down like a yo yo. He's right, he can. But he is trying to thread a very difficult needle, which is you bring the dollar down while at the same time not looking weak and, you know, face that's part of the colossally difficult challenge that they have. How do you maintain confidence in the sovereignty of the United States while at the same time talking down the world's reserve currency?
- [04:25]
A
I have a video I want to show you. This is from Besant talking about what's likely to come. He's calling it a non inflationary boom. And I would just love your thoughts on whether this is actually possible.
- [04:36]
C
Coming back down towards the Fed's target. We're going to. We're seeing rents drop, we're seeing gasoline drop, we're seeing President Trump out there fighting every day for lower drug cost and we're going to see that. And again, you know, Affordability has two components and we're going to see real wages go up for working Americans. So controlling cost, wages up and as I said, these big tax refunds. So I think we're going to have a boom in 2026. And Sean, the important thing here is it's going to be a non inflationary boom and I think it could really extend for several years.
- [05:19]
A
I don't know why he was kind of frozen there, but we heard the audio at least. Right? So rents drop, gasoline drops, wages go up, everybody gets $2,000 tax refund and somehow there's no inflation. What am I missing?
- [05:31]
B
Yeah, I actually agree with him, except for the no inflation part because it's not just the economic activity that drives inflation. Currencies play a very big part of it. And with a lower dollar you do have an inflationary force right there. Throw in the infl inflationary force of de globalization and there's very little to bring inflation down further from current levels. I know the truflation index is pointing downwards, but that's not necessarily what the Fed is going to look like. In other words, the indices that matter for rate setting are calculated on very different bases. And that brings us to the rates question. If indeed Secretary Besant is correct and there is going to be an economic boom next year and people, it looks like the signs are definitely pointing to one. Why are we thinking that they'll drop rates again?
- [06:20]
A
I have no idea. Seems that we need a perfect. I think we're thinking they'll drop rates because by that time we'll have a patsy in the Fed.
- [06:27]
B
Yeah, probably. And we still don't know who that patsy is going to be. Rick Reeder, who seems to be the front runner at the moment, was saying some very interesting things. I think it was last week. To be honest, this month has gone by in such a blur and that he was dropping heavy hints that he doesn't think rates matter. And I think he's right. I've been arguing this for quite a while now. Monetary policy is not relevant. And I think one of the big things the markets have been overlooking is that rates actually don't matter very much anymore. And yet we continue to be obsessed with them. I for one will be watching the FOMC press conference later. I mean, it's the go to thing every single, every few weeks. But Rick Reeder, the potential next chair of the Federal Reserve, saying that rate doesn't matter is exactly the kind of Fed chair that you can imagine Trump looking for, someone who understands that it's all school now. Just don't get in my way.
- [07:16]
A
I agree with that. It's like, you know how they sort of joke that when there's a presidential election, the last thing you want to be is the leader out front months before the election, because you're just the target and everybody shoots you. Like Ron DeSantis was supposed to be the next president. Obviously, we got Trump. I feel like that's how the process has been for the Fed chair. You want to be the guy that he thinks of the last week. How many people have we had where it was down to one or two guys and none of those people are being mentioned at all anymore?
- [07:42]
B
Exactly. And you also got to wonder, Scott, why would anyone want that job, knowing that you can't bring rates down as much as the president wants you to and you're going to get attacked in public for it?
- [07:54]
A
Yeah. I would not want to be Powell now, and I certainly would not want to be who's Next. But it does seem that all of the candidates are the ones who are saying what Trump needs to hear to potentially get hired.
- [08:07]
B
Yeah. Which is. And he seems to be aware of that, which is why you're probably right. There'll probably be a. A surprise candidate pull down for the last minute. We're supposed to hear this week, aren't we?
- [08:17]
A
I think. But I feel like we've had that news quite a few times.
- [08:21]
B
True. Very true.
- [08:23]
A
Yeah. So. And all. Yeah. There's been at least six people I can remember that were basically a shoo in for the next Fed Chair. So I think we'll wait and see. But whoever it is, it's going to be somebody who's talking that exact book. And I think that that's what matters. But I tend to agree with you and with them that fiscal is all that matters right now and the Fed has effectively been neutered. But I want to pivot a bit to what the main title here. Bitcoin and Crypto Enter a Critical Moment, not our words. This is coming from our good friend Matt Hogan. I said the crypto industry faces a critical period if Clarity act fails to pass. So it was sort of a foregone conclusion that this was going to pass. Even in my mind. I've sort of admitted being wrong there. Now. I don't think it will. And I think people are starting to realize that. I think there's just a ocean of issues in between the Democrats and the Republicans and even more specifically between the Democrats and Trump on what they would each agree to. And I just don't see it happening. But he makes a really good point here and something we've been talking about for a long time. He said that if it fails to pass would prevent the current regulatory environment from being codified into law. Reports of friction within the industry have emerged and Coinbase withdrew their support. But basically what he's saying here in this article that I agree with is the fact that if we don't get this, we have a three year period where we know that the regulators will still be friendly even if, if the legislative environment changes. Right. If the Democrats win the House, I think that's at 75% on polymarket. Right. By the way, 76%, something like that, last I checked. But that we still have a very favorable cftc, favorable sec, that can set a whole lot of precedent. But the onus will be on the industry to actually prove that we deserve it. And I've kind of said that for a long time, and I think others have, is that we can have all the narratives we want, but unless there's so much adoption and so much mainstream interest that they can't ignore it, we're gonna disappear into the ether. No pun intended, I guess.
- [10:19]
B
But very good now. Yeah, totally, totally agree. I am not certain it won't pass. Obviously Coinbase's move was a very, very bad news for the momentum, which is really hard to get. I'm European, I won't even pretend to understand the machinations of Congress. But I know that momentum is important and it has been lost. The snow which delayed the Ag Committee markup hasn't helped, although I gather it's going ahead today. But momentum has been lost and there are other priorities and there are midterms and there's going to be a lot of stress on capital. So, yeah, it may be. I mean, but then again, there's David Sachs who wants this to be part of his legacy. So he's going to be pulling all sorts of strings in the background to make sure it happens. I don't know, I don't have a clear idea of whether it will or not. But you're totally right. If it doesn't, it's really not the end of the world. What it would take is not just industry, our industry, proving that we deserve it. I mean, obviously we do. It would be the industry adoption getting big enough to make it really hard to unwind should a hostile government come into power in three years. In other words, too big to fail. We need to get too big to fail fast. And again, that's assuming a hostile government comes into power. When I say hostile, I mean to the crypto industry. Obviously it's assuming that things flip the next election, but maybe they won't. Again, there's a lot of assumptions in there. Right now the crypto industry is in a very good place. Clarity act would be good, but without it, it's still in a very good place to find its way in into boardrooms, not just around the United States, but around the world. That tends to look to the United States for guidance on where regulation should go. We have global moves as well. Japan moves so much slower than the United States. They're looking at approving ETFs in 28. You've got South Korea pushing through stablecoin regulation. Still maintain China will get to regulating licensed exchange exchanges at some point. And it's not just a US Story, although obviously the US Regulation framework is what the rest of the world is going to look for. We just need to get big fast.
- [12:25]
A
I love the becoming too big to fail comment because I think that really sums it up exceptionally well in in a single sentence. And you know, we've seen Coinbase say things like no bill is better than a bad bill. And I think that I can see that argument. I'm not quite sure because I'm not reading the bill, but I can see that argument if certain things are in there. So first of all, we should be honest that Coinbase actually has a great environment right now, as you alluded to. It's really not that bad for the industry even if this doesn't pass. And it's actually great for Coinbase if this doesn't pass because they got the rewards language they wanted in the Genius act and they are offering a yield. So there's no reason they would ever support anything that's going to in any way shape or form impact their business negatively by taking that yield away. But as Matt says, and you say one of the big narratives is that we're going to tokenize everything markets are going to move. 24, 7 365Paul Atkins in Project Crypto talking about that happening by next year, the DTCC themselves saying that will happen by next year, which was mind blowing news from a few weeks ago. And there's language in the Clarity act right now that says you can't tokenize securities. So we really can't have that act pass right now and have the adoption that we're looking for. So it's a bit of a catch 22. It's a tough situation.
- [13:42]
B
Exactly. There's there were some things in There for me, stablecoin yield is not the sticking point, but there were sticking points in the Clarity act that should not have passed. But they're the kind of small things that you would have hoped would have gotten struck down in the markup sessions. That is what the markup sessions are for. Another one that I thought was very dangerous was a clause in there that said the SEC cannot introduce any exemptions, which is extraordinary. The SEC does. I mean, that's what it does. You do delegate exemption powers to the agencies. It's very unusual to have that struck down in a bill. The agencies are on the ground, they understand the exceptions. They should have that kind of power. But again, these are the kind of things that you would assume would get struck down in markup. Maybe we'll just get a better bill. Maybe Coinbase's gamble will pay off and it'll be yet again a case of them taking one for the industry. They've done this before and so maybe we'll all end up just thanking them for delaying this. But in the end, tokenization, you're quite right. We have nasdaq, we have New York Stock Exchange building tokenization trading, tokenized asset trading platforms saying they're going to be launching this year even. And that is absolutely astonishing.
- [14:54]
A
Yeah, I mean, here the U.S. senate Agriculture Committee will vote on a major crypto market structure bill tomorrow at 10:30am Then it goes on to say if this bill is approved and signed by President Trump, it could reduce price manipulation and WASH trading crypto by nearly 70%. Feels like they, whoever this is literally just made that second sentence up and doesn't even understand that the Senate Agriculture Committee voting on this means very little for the long term prognosis of this passing. We have multiple versions of this bill. There's still a lot of contention between the two parties on which one will land on. This bill has not even been approved at all by the Senate Finance Committee, which delayed their markup. So even if it passes, this is not a tomorrow thing. This is not a tomorrow thing. That's what I want. To be clear, I don't know where they got that wash trading and crypto part. Very strange. So you actually though, are still optimistic that this could get done? I mean, in your mind, knowing all the issues that are here, do you have a even ballpark timeline you would consider?
- [15:56]
B
I think if I had to bet, I think it will get done this year. And again, I'm not confident. Confidence level is very low on this, but if I had to bet, I think it was again we have David Sachs behind this, and he knows how to pull a few strings. There's also a lot of industry momentum, some big names, even Coinbase is, you know, talking to the banks. And let's face it, it's in the bank's interest to get clarity passed, because if Clarity doesn't get passed, rewards on stablecoin balances are allowed. In other words, shooting themselves in their foot by being an obstacle to this. So there's just a lot of incentives aligned to get this passed, even from the community banks. And there's the coordination from the very first White House position focused on getting crypto legislation through. So if I had to bet, I think we'll get it this year. Confidence levels are not. I wouldn't say they're up at 80% or anything like that.
- [16:48]
A
My, like Native American. Native American. From the perspective of being, as an American, Native to America, don't get in trouble. My citizen, my cynicism is very high. Right. So, like, you know, my Spidey senses say our government is inefficient. Maybe we don't get it done. So I love the perspective because I think you're right. There's a lot of incentives still to do it. I am not a Native American. I don't want to start being called Pocahontas on my show or anything. So going back to sort of what Matt Hogan said, we do see a meaningful level of adoption happening, specifically with stablecoins. Obviously, large businesses driving crypto payments adoption. PayPal survey fines. It's really interesting. They said that 4 out of 10 US merchants, which 40% obviously now accept crypto at checkout. PayPal and the National Cryptocurrency association said, citing a Harris poll, it goes on to say that these are usually the larger merchants. So obviously PayPal has made it a point to say that Everywhere that accepts PayPal, you'll be able to accept this. But what I found interesting and really in line with Matt Hogan says, is when you dig into the survey further, these businesses are saying they're doing it because their customers are demanding it, not because it was a natural evolution for them. So one they these merchants are hearing from customers who want to pay in crypto, but those same customers are saying it has to be as easy as using my credit card or any payment that I'm familiar with. And that is not the case yet. So it's available, but a lot of people still aren't using it and are demanding it to be available. But also seamless.
- [18:23]
B
Yeah, that's changing fast, though. Also You've probably noticed the massive growth that we're seeing in crypto linked credit cards or debit cards sometimes as well. Huge growth there. I mean, still is a niche case for stablecoins. Bitcoin news broadly, that's still focused on trading. But the crypto card landscape has, I won't, I won't give numbers because I have a terrible memory, but it has grown by orders of magnitude over the past year and probably will continue to do so, especially as tradfi is tiptoeing into this arena, seeing one, how profitable crypto cards can be and two, the yield opportunities behind them. What I'm really interested in is anecdotal evidence. I can't, I can't produce numbers here, but I know of some tradfi institutions that are looking at using vaults to get some defi yield for their crypto friendly clients. And this is absolutely astonishing. You and I talked before about how yes, tradfi is going to be adopting defi when they see how clean it can be. And I'd say it's, it's starting.
- [19:25]
A
Vaults have come out of nowhere as the new narrative. You're obviously also on top of that. I wrote about it in my newsletter for the first time today. Right. And I'm still only at a very high level. I mean can you give the very TLDR to people what vaults are? Because this is all anyone's talking about and it seems to have appeared Monday.
- [19:44]
B
It's in fact also I was writing about vaults for the American Banker magazine just a few weeks ago to gauge the level of tradfi interest in this vaults are, to put it very succinctly, vaults are curated defi. We all know that defi is where you can get high yields depending on the risk that you are able to assume. But we also know that it's complex, not necessarily user friendly and who's going to spend all the time that they have, you know, researching the various risk profiles of the platforms. Back in the defi summer, you probably remember Scott, there were people in front of their screens all day just hopping from platform to platform to get the biggest deal. Well, vault will do that for you. Yeah, vaults do that for you. They are a smart contract where you deposit some stable coins thing and they will then scan the defi universe and allocate according to the parameter, the risk parameters that you have chosen. You want a reasonable yield but low risk. Maybe you can get 3% or something by depositing into various tokenized money market funds. You want maybe 7%. Well, here's a nice lending protocol that is taking a little bit more risk and using different kinds of collateral you choose and the vaults manage it for you. It's basically a cross between Defi yield and asset management.
- [21:06]
A
Actively managed asset portfolio, but being done by a smart contract. I can't even imagine what happens when AI gets heavily integrated into this. Right. The other thing. So there's two things I heard of this week that I'm clearly laid on vaults and claudebot Clawd which apparently the world is running out and buying Mac Minis so that they can run this AI agent in a, you know, in a box instead of allowing it to go skynet in the cloud. But you put it on your Mac Mini and it, you know, manages all of your tasks, checks into your flights, answers your emails, does literally everything and people are freaking out. So what happens when that becomes advanced enough, which it maybe already is, to be an asset manager and integrate with Defi and manage your portfolio for you?
- [21:49]
B
Yeah, I would say arguably it already is. Funny you should mention that. I just put on my list of things to do this week. You know, look at that clawed. But. But I gotta be honest with you, on a personal level, I'm kind of afraid of removing the friction from day to day life because what does life become without its friction? Right. Anyways, comes down to trust. I mean one thing, the big problem we have with defi yields generally is the trust. Do you really trust the collateral? Do you trust that the contract is doing what you say it's going to do? Most people aren't, you know, they're not coders, they don't know how to read that. And then on AI we have a similar kind of thing. There's not yet the widespread trust in AI that we would need to delegate some asset management to it. But you're totally correct. I mean you can see some kind service emerging around that. And stepping back one further, you can see the attraction for Tradfi if they can offer yield with low overhead using assets that their clients are increasingly storing in the tradfi crypto custody wallets that are now part of any mobile banking app.
- [22:51]
A
So to be clear, the differentiator here with vaults beyond the actual tech and the smart contract is the fact that it's being taken seriously by institutions. It's not just a bunch of defi degens throwing their money in there. So you got to imagine that if this gets to the highest level of institutions and they start depositing customer assets into vaults, they can also fire their asset managers. You got to Imagine that this is massively bullish for their bottom line.
- [23:17]
B
Exactly. And let's face it, the asset management industry has been contracting in terms of of employees anyways because everything's passive these days. Active funds are not really doing that well. Everyone prefers. That's a whole separate story which we should have an entire episode on because I think that's incredibly dangerous. But yeah, want to keep overhead. Banks are going to want to keep overheads down, especially if they are trying to, you know, starting to maybe pay some interest on deposits to compete with stable coins. Yeah. And especially if, you know, costs are going up for other reasons, and especially if rates are coming down, etc. Etc. But you know, banks are going to want to keep an eye on their bottom definitely right now. Very profitable. But we know that's cyclical.
- [23:56]
A
So here's another story right in line with this. Amazon announces they are laying off 16,000 corporate employees due to, quote, rising competition over AI. Interestingly, I don't listen to many podcasts, but I at some point in passing had the all in podcast on. And David Sacks, who we mentioned before, and Jason were arguing over this, where Jason kept saying it's AI are taking the jobs. AI are taking the jobs. And Sacks, as the AI czar, was saying, no, they're not. There's other reasons that these jobs are going away. Seems like AI might be taking the.
- [24:28]
B
Jobs part of it. Yeah, I mean, I kind of agree with David Sacks on this. I don't think it's entirely AI. We know that most of the big corporations over hired after the pandemic, when labor was just so tight. You hired just so you could have people you might need just in case. Well, now there's these. Seem like the scene is changing and people are shedding roles they didn't really need in the first place. And a lot of that also has to do with, with the mood in corporate America these days. AI is part of it for sure, but I haven't seen much evidence of big AI layoffs. We're seeing these numbers with zeros behind them and we think, holy, it started. But we also have to remember these are thousands and we can start to get scared when we're looking at millions. The, the Amazon thing is worrying. I mean, that comes on top of a14,000 announcement. I think they did last month, so it's now 30. That's not insignificant, but I'm actually going to agree with David Sacks on this. AI is part of it, but it's not the whole story.
- [25:22]
A
I mean, I'm Torn on this one, but I tend to agree with you and with him. I have heard our whole lives and have read the histories of any emerging technology and the fear that it's going to replace everything that humans do and it ends up generally just leading to a renaissance and innovation and more jobs in industries that we've never heard of or thought of yet. So I lean in that direction. But it shouldn't be a surprise that Amazon using technology to be more efficient is going to lead to layoffs, whatever that technology is over time. I would imagine that that's also true of robots in their warehouses and new management and supply chain systems that are not even AI based over time.
- [26:04]
B
Absolutely. And the robotics is a much more relevant story, really. I mean, robotics are replacing jobs and this ties into what we were talking about before, Bring the dollar down. Why? Because that way you'll get factories built in America again and you'll be able to rejuvenate or restart the manufacturing industry. Well, is that all those factories going to be peopled by people or robots? Is this really going to help the jobs outlook in the United States as much as was originally promised? I'll argue no. They're going to be automated because that's what you would do if you were building a new factory today. I do think. And obviously robotics combined with AI, now that is an entirely different proposition, which if we like, we can tie into the crypto industry because how are they going to transact with each other? Again, that's probably more futuristic than we are needing that we need to look at for, to understand today's markets. But it does all tie in to the dollar. It ties into the manufacturing renaissance and it ties into the outlook for the jobs market. Market.
- [27:03]
A
I think that's coming fast. You know, I don't think as a mainstream widespread thing, but when you look at something like cloudbot that can obviously automate effectively all of your tasks, it's not a big jump for it to imagine that it's also just going to go ahead and pay somebody. You owe $10.
- [27:19]
B
Yep.
- [27:20]
A
And now maybe you can have access to your PayPal and Venmo or cash your bank account. I don't know. But I would say that if it's, if it's one AI to another AI, it's going to be in some way blockchain based.
- [27:31]
B
Yep. And now coming back to vaults, what if you have the stable coins with which you can pay the various AI apps you're interacting with, but while you're not using it, it is earning for you I mean that does not exist in traditional finance today. You can have your demand account and that's just sitting there doing nothing. But you do need to have cash in it that you for payments, etc. But in, in the on chain world, that's not necessarily the case given how settlement is within seconds. And for many of these, well, not all of them, but for many of them you can withdraw right away. And up until that moment it is earning for you. And again, this is an entirely different paradigm. So we can understand why the banks are kind of freaking out about this, but at the same time they can use it to retain clients, to improve their systems, et cetera, et cetera. Which is where I think we'll end up. Up.
- [28:24]
A
Yeah, the banks are worried about stablecoin yield. It sounds like any meaningful adoption of vaults is going to be a much bigger problem for them because it's sounds like it's your bank account plus your Schwab account, plus your checking account, plus your credit card in one place, plus your ETFs. You can be earning, actively manage your yield. If you can immediately use that vault, then to go make a payment on something and it just takes a bit out of your balance, but continues doing what it's doing you don't need. You have one place for everything.
- [28:54]
B
Yeah. And isn't this a wonderful reminder, I mean, again, we've talked about this before, that this is technology, the tech, the crypto technology, blockchain technology is forcing us to rethink things we've always assumed to be true. And that is you don't get paid interest on demand accounts, you only get paid interest on savings accounts. And here we have a technology that shows us. Wait, actually that's not necessarily true. You can, you can have both. The questions, I think are the more transformative aspect of this more so than the technology, even.
- [29:27]
A
So going back to the dollar and the purposeful weakness. I just kind of want to talk through this with you. Is there a point where they push too far and go over the line? Is there a point where it goes too high? How do they thread this needle? I know that they say that they can control it like a yo yo, but that feels like one of those, those dangerous comments where you can until you can't.
- [29:48]
B
And you know, also yo yos. I mean, I, I don't know about you. Were you any good at yo yo when you were young? I, I wasn't. I could get it to bounce a few times and then it would just hang there at the end. So we can Extend this metaphor if you like. We understand this metaphor, but yeah, where can it get too low? I, I think we'll start to see screams of anguish when it heads down closer to 80. And I think that's when we'll start to see Bitcoin react. I was thinking this morning about why, you know, why is Bitcoin not wrecked? This is the perfect soup for Bitcoin to really move in, and it's really not. But if you it, it's helpful to realize that Bitcoin is a global asset and there are different communities, geographical communities of investors. We tend to look through, at the markets through the North American lens. I'm in Europe, but Western lens, should we say. And it moves and rests the dollar. Why is it not moving? But basically we have to so much else at the moment going on. And we also don't really see the need to hedge against dollar debasement. The American investors on the whole are not scared. You've got a stock market that's looking good. The bank of America fund manager survey a couple of weeks ago showed that cash positions are at record lows. And investors in the survey are not worried. They're very confident that the stock market is going to keep going up. So again, why worry about hedging against dollar debasements? Not an issue for America.
- [31:16]
A
They're cheering for dollar debasement because dollar debasement means if you are the rare few that are fortunate enough to own assets, they're going to keep going up.
- [31:23]
B
Yep. And also it's good for corporate earnings, etc. Etc. And in Asia, well, the giant is China. They're probably not going to be piling into bitcoin. They're piling into gold. In fact, you know, we, we know that both retail and institutional are piling into gold in China, India, what gold, probably Japan, very regulated, not confident enough yet to be piling into Bitcoin. They don't have the base to pile into Bitcoin yet. And here in Europe, we still see Bitcoin as a risk asset. So again, there's a cultural barrier there. What will it take for the North American investors to get scared enough to start to look at dollar debasement hedges? That means the dollar needs to go lower for that. And by the time it gets down to around 80, gold may well be at 6,000, in which case bitcoin looks even more attractive. It looks less frothy and it'll, it'll have some catching up to do, especially with the likes of Larry Fink, the BlackRock CEO you know, putting selling this narrative on every one of his public appearances.
- [32:30]
A
I'm gonna, I'm gonna share this meme on every show now coming back down. Could you see it? I don't know if it's working. Yeah, let's see if it's running. But yeah, when you write about currency debasement but bought bitcoin instead of gold, silver or copper, this is so funny to me because this is just how we all feel right now. Although I think he's actually happy in this scene, if I remember correctly. But he doesn't look happy. But yeah, it's like we got the whole narrative right, but bitcoiners just feel like they're wrong. I can give you my take on it. It. I can see how it's very disconcerting that the dollar is dumping down and everything's having a bull market and bitcoin's doing nothing. I think that's a very uncomfortable position for bitcoiners. But I'm a much more glass half full kind of guy and I love a, the opportunity to buy it when it's not participating because I deeply believe that it will. So, you know, as excited as I would be for it to be 130 or 150 right now in that world, I would never get to buy it in the 80s. So to me it's totally fine. But b, more importantly is that we had this narrative forever that bitcoin was uncorrelated. It should be treated as an uncorrelated asset that doesn't do the same thing as everything else. And if you put it in your portfolio and 5% of your portfolio is bitcoin, even if it goes down, when other thing goes up, it increases your Sharpe ratio. And the holy grail of investing is idiosyncratic assets. We have that and nobody can argue with that now. So uncorrelated is something we should cheer for because it's great for portfolios in the long term. But sometimes that means that when everything's going up, thing is it.
- [34:05]
B
Yeah, you don't want to correlate it if you're missing out. Right. Yeah. Two things I, I think of and. And I spend some time worrying about this. My biggest concern is that bitcoin doesn't do anything and everyone just loses interest. It's like, yeah, a dud. I'm out. And we've seen some of that in the selling over the past few months with people that bought it at 120 thinking it was going to 150 as soon as it hits Their break even, you know, they're out because this is not the fun I thought it was going to be. And we also do have of many of the long term holders getting out because yeah, we're sort of done as well. It's no longer our market. So the longer it does nothing, the more people might lose conviction it will eventually do something. But then again, you are totally right. Those of us that still believe and include myself in this also those that still believe that the tailwinds are there and it's a matter of patience, well, we can take advantage of the opportunity to buy at these levels because it may not come again anytime soon. And we have to remember Scott, you've seen this many times. When momentum starts, it starts.
- [35:11]
A
Yeah. No better advertising for bitcoin than higher price of bitcoin.
- [35:17]
B
Absolutely. That's why momentum is more pronounced in bitcoin than in most assets because price is the narrative that the headlines are going to be screaming about. And that's when you get the yolos and the oh shit, I missed out. And arguably there's career risk now in missing the bitcoin run the last cycle. You know, no career risk, it's risky. The boardroom isn't approving, et cetera. Now there's career risk in missing it.
- [35:42]
A
Well, now we also have corporate bitcoin holdings hitting 1.1 million bitcoin worth 94 billion in Q4 of 2025 with 19 new public companies entering per Bitwise Report. Honestly, we have to look at that and say at microstrategy or strategy is the bulk of that, right? Well, more than 50%. But this is a great segue for me since I have you you today to ask you what you think of the treasury company environment. It seems to be something I feel compelled to ask every single guest because.
- [36:13]
B
Yeah, I was pretty ugly out there actually. What your thoughts are in there? So I'll answer and then I want to hear your thoughts on it. I'm relieved to see the hype die down. It always felt like very uncomfortable financial engineering totally divorced from the narrative behind bitcoin, which is what I personally care about. So I'm kind of relieved to see the hype die down there and, and the dat's being behind a lot of the price movements was just uncomfortable because we all know it wasn't going to last. What's your take?
- [36:42]
A
So I agree 100%. I'm relieved. I've talked about a lot so I don't want to beat the drum but I was a skeptic from the very beginning I took endless hate from a lot of friends in the industry who are very passionate about treasury companies from the beginning and I was vindicated pretty quick. So now I would love to see their vision actually come to fruition. So we got the pump, we got the dump. I still deeply believe that a lot of companies should own crypto assets in various different ways. And it seems like they're opening their eyes to the creative ways to actually do that beyond just buying the top and hoping for the best, which is obviously, I think what we saw before. I mean, I think strategy is trading at a discount to nav right now. That seems like an opportunity to me. I think a lot of these are trading at a massive discount, which seems like an opportunity for better capitalized treasury companies to merge or acquire and buy cheap bitcoin. And I think that a lot of them are looking at cash flowing businesses, which is the way that I think you should responsibly accumulate bitcoin. Anyways, I'm optimistic once again that what comes of the next iteration will be positive. And how many times in this industry have we seen the first round of something be an absolute disaster and then the second or third round is great. We're sitting here talking about vaults, but we had defi summer where as you said, people were jumping from platform to platform to farm yams and tacos and now you have maybe blackrocks looking at vaults for people. So there's real value in a lot of the things we do. We just do it way too fast and break too many things.
- [38:13]
B
Yeah, that's very well said. You make an interesting point about potential M and A amongst the dats as well. I haven't thought of that. But that could be the consolidation. We know that that segment of the industry needs, needs and the reset before it starts expanding again.
- [38:29]
A
I want to go back to gold because I found this just astounding. Tether bought more gold than Poland's central bank last quarter. So they're one of the now I think they're the largest non sovereign holder of gold in the world. There was this crazy report about how it's being kept now in nuclear bunkers. And they basically have their own Fort Knox which many conspiracy theorists would say probably has more gold in it than the actual Fort Knox. But good.
- [38:55]
B
Where, where is that audit by the way?
- [38:58]
A
We also don't know how much bitcoin. We hope. We hope.
- [39:01]
B
Yeah, that's also very true. But you would think the gold audit would be some. It's a question of going in and counting the bars and it's very interesting that we haven't seen that. And despite the promises a year ago on the Tether gold thing, I was looking into the numbers this morning. I was, I was writing about this briefly. It didn't buy as much as the Polish central bank over the past quarter. It did buy more over the past year but over the past quarter Tether was the largest buyer of gold than any central bank other than Poland. I mean that's absolutely amazing. Poland's been topping the list of central bank buying for a while now. I'm not sure why, what's going on there, but that's notable. Tether number two. And Tether is today the world's largest non bank, non sovereign and non ETF holder of gold. And what's interesting is it is holding all of its gold in bunkers in Switzerland, not in the financial system.
- [40:03]
A
It's like they're building their own central bank with like zero counterparty risk to themselves and none of the garbage that comes with being a central banker. I'm not saying I can't say whether that's a good thing or a bad thing into the future, you know, but they're hoarding this stuff and they control every single out.
- [40:20]
B
And now they are issuing a StableCoin in the US to complement the world's largest stablecoin in markets everywhere. And gold is just over 7% of tether's reserves. And again there's a lot of. I need to do a lot of thinking to connect the various dots but there's something going on here.
- [40:40]
A
I'm always need to do a lot more thinking and never arrive there on which assets Tether holds where. Right. So they have gold backed stablecoins but that's obviously not the same gold as they're buying for their own balance sheet. Those in some way have to be segregated. So I wonder where the line is for all that. There's always confusion by people as to what bitcoin they own and why they buy it and how that is accounted for and what would happen. People always confuse. If Bitcoin goes down, Tether's in trouble. But Bitcoin's not backing their assets, they're buying it with their promise profit.
- [41:14]
B
Right, exactly, exactly. And they now also have a very extensive portfolio of other businesses to hedge their revenue streams. And they are. Paolo Arduino was quoted in the Bloomberg article this morning saying they're going to be buying for the foreseeable future. Well certainly for the next few months and then they're going to take it on a month by month basis. In other words, they're not done.
- [41:37]
A
Yeah. There was a crazy story, by the way, about the United States strategic bitcoin reserves are holdings. I don't know if you saw this. And I have not dug into it. I saw it in passing, just remembered it while we were talking. A US government investigating alleged 40 million crypto theft by federal contractor Son. So apparently $40 million of the money held by US marshals that had been confiscated in bitcoin. The government contracted a company to handle all of that and the CEO's son stole 40 million of it somehow. So I don't know if he broke into his dad's computer and got access, but stole some of the United States government's bitcoin.
- [42:13]
B
This news timeline is just nuts.
- [42:16]
A
We have to be in a simulation. Right. Can I ask you who's buying silver in your mind, why is the price of this is yet my other. We do digital asset treasury companies, then we do silver. Where's the silver?
- [42:28]
B
Of course, Natural progression. Yes.
- [42:31]
A
But I think people view gold and silver as like this monolith of precious metals. And I view the reason they're being bought entirely differently.
- [42:39]
B
Exactly. But I think related and this is something I've been scratching my head about also. We know gold is the safe haven asset. We know central banks have been buying it. We don't know central banks have been buying silver. And yet silver has gone parabolic, which says to me that we are seeing some froth in the gold market. We know that central banks are still buying, although the rate at which they were buying possibly has slowed over the past year. December's figures aren't in yet, so who knows? That might change. But the rate seems to be slightly slower to compared. Compared to similar periods a year ago. But it does suggest that precious metals are now seen as, you know, the place to be, which makes them a risk asset. It is all very crazy. However, the rise in silver does suggest to me that gold could have a correction at some stage because there's froth there as well.
- [43:26]
A
It's alt season, right. Bitcoin goes way up. People get bored and they buy ethereum.
- [43:32]
B
Yeah. I mean, silver's got some fundamentals. And this is sort of related to some of the crypto stuff we've been talking about as well. And the big deal is that China is now limiting exports of silver. China is a very big silver producer. It's limiting exports. So there's a supply squeeze. And that again can't happen with gold because the distribution of mining is, is much more even and so worse, it can't happen with crypto unless you get to a stage where you start to have geofencing. Anyway, this is something that I've been thinking about. What could really fragment the crypto marketplace. Regulation is one, geofencing is another, et cetera, et cetera. But after we're seeing important commodities used, I won't say weaponized, that's too strong a word, but used to produce certain behaviors and thinking of rare earths and silver could be one of them. Also, it does shine a light on a landscape, a financial landscape which supports assets that cannot be so easily restricted. It's an interesting counterpoint.
- [44:28]
A
So you made a great point about silver being a signal of froth in the gold market. What's the signal of froth we get then for the silver market market?
- [44:36]
B
Yes, yeah, price. I mean those price moves are insane. Again, yes, Silver is more used in industrial applications than gold. And you combine that in increased demand for solar panels etc with the crunch in supply and it does set the stage for a parabolic run. But then you know that speculators are piling in to take advantage of that.
- [44:58]
A
Yeah, I, I think, I won't claim.
- [45:00]
B
To be an expert on the silver market. Could no doubt put holes in my suspicions.
- [45:06]
A
My years in crypto. You make my spidey senses tingle when I start to hear all the fundamental reasons. But something like silver just shouldn't go up 5x in a matter of months, even if it was deeply because of fundamentals. I understand clearly the flywheel. Silver's needed. And the more the price of silver goes up, the more people who need it now or into the future are going to panic and buy it at lower prices, assuming that they may be priced out for industrial reasons. But you also have lines of people and stories of buying silver at a 30% premium from websites. And nobody can actually sell the physical silver at the price that it's listed. I mean all the signals that I've seen from alt seasons of the past where all of a sudden this new thing is the most important thing that's ever existed, but somehow we missed that the entire time.
- [45:55]
B
Absolutely. And the biggest tell is the slope. Now if I were a derivatives trader, I'd be using all sorts of fancy vocabulary here. But just look at the slope. I mean, if you were looking at a supply demand imbalance, it would be a more orderly progression upwards and to the right. This is not orderly.
- [46:11]
A
I'm bringing up the chart because for anybody, I don't want to Take for granted that people have seen this chart of silver. This is just a daily chart. I mean, that is crazy. That's only going back to June. I mean, this looks like, like a low cap altcoin that is being shilled and is about to be dumped back to zero. Mike McGlone said on the show, he's like, you're going to get to buy silver again at 50 bucks. I agree. I don't think it's going to be anytime soon. And when Bitcoin was 126, I said, you'll buy it at 88. And that was too high, went way below that. So this just feels like I'm not calling a top. I'm not dumb enough to do that. But there's going to be a time when this gets very, very ugly for all those speculators.
- [46:52]
B
Yeah. And here's a question. When people start to exit their positions in precious metals, their speculative positions in precious metals, where do they go?
- [47:01]
A
Yeah. What do you think?
- [47:03]
B
What has underperformed?
- [47:06]
A
There's this natural assumption in the crypto industry that our thing is going to be the thing that everybody rotates into. I do think we get a percentage of that. But I also don't think that every person buying silver right now is thinking, when I get to the top, I need to buy Solana.
- [47:20]
B
Very true.
- [47:22]
A
I think it might be a. Most of the people are probably different. I don't know. It's a. It's a crazy, crazy market, crazy world. Anything else on your radar that we might have missed before I let you go? I know I kept you a bit over time.
- [47:35]
B
No, I mean, talking to you flies by. It feels like it's been five minutes. But pulling on that final point to sort of wrap everything up, some reasons about, you know, where we are in the crypto industry and one of the reasons why bitcoin's not moving when it should with the tailwinds etc and you know, tying into the whole. What you mentioned about the silver and crypto correlations is that crypto, bitcoin, let's say bitcoin is a macro asset now. That's one of the reasons it has it reached 100,000. It's one of the reasons you have BlackRock talking about it in every public appearance. It's one of the reasons you have even government officials at the highest level holding bitcoin in their personal portfolios. Bitcoin is a macro asset now. And this is both a plus and a negative. It's a plus because of the validation and the protection It's a negative because there's so much else to choose from. We in the crypto industry tend to see Bitcoin as the most liquid, the most obvious, the on ramp, etc. We're here because we care about the narrative and the technology and the adoption. But for macro investors, it's one of a range of assets they could be putting money into at any given time. This means that it's not necessarily going to benefit from tailwinds when there are other more obvious candidates. And it also means that when there is a reset, it could head for the door sooner because it's easier to sell 24. 7. Or it could simply not benefit from any correction when us in the crypto industry are thinking, yay, finally it's our turn. No, there's plenty of other opportunities and assets and derivatives and strategies out there. So bitcoin being a macro asset is definitely a plus in the size and protection, validation, etc, but it's a negative in that it's no longer the story.
- [49:14]
A
Such an incredible conclusion to the show. While you were talking, I was thinking exactly what you sort of said there towards the end, which is that as great as all that is for bitcoiners, if you're not deeply entrenched in a believer and buying it because you think it's going to be the global reserve currency on Saturday when things go down, you're just going to sell that because you can't tell anything else.
- [49:35]
B
Exactly.
- [49:36]
A
Until we escape that, it's always going to be, I think, more volatile and unpredictable than most other assets. Noel, thank you so much as always for joining us. Noel has an incredible newsletter, so maybe we never talk about it, but maybe you could just tell everybody about it briefly.
- [49:52]
B
That's very kind of you, Scott, thank you. I write crypto is macro now, where I look at the growing overlap between the crypto and macro landscapes, how crypto is impacting macro and vice versa. It's daily and it's on substack, everybody check it out.
- [50:07]
A
We'll add the link down in description afterwards. Noel, thank you so much for your time. Always a pleasure and thank you for covering me for me so often.
- [50:15]
B
Pleasure, Scott. Great talking to you. Thank you.
- [50:17]
A
It just said let's do.