← The Wolf Of All Streets
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- [00:00]
A
We're halfway through October and bitcoin is still bouncing around. 1110-001120-00110,000 with tons of volatility even on low time frames, leaving many to ask if October is just a meme this year or whether we will still see follow through and a big end to the month. There's a lot of news to unpack, a lot of conversation to be had, and I've got Yago here to go through all of it with me. Let's go.
- [00:31]
B
Let's dope. Let's do.
- [00:46]
A
Good morning, Wolf Pack out there. I'm anticipating a much calmer and reasonable show today since I do not have Peter Schiff on again and I am not wearing gold chains as I did yesterday. Yeah, go. I'm assuming you didn't see yesterday.
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B
I didn't, no.
- [01:02]
A
But it sounds like. Yeah, I did the intro and while the music was playing, I put on some gold chains and I talked to Peter Schiff and a friend of mine, James Heckman. James completely plowed over shift and just didn't let him talk the entire time. And I sat there looking like I was ready to dj. It was entertaining at best, but we can actually talk about things.
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B
He's having his best year in 20 years.
- [01:28]
A
Having the best year anybody's ever had. It's, yeah, you know, the guy's just having a good time. He uses us as rage bait to go sign autographs at the bitcoin conference and sell more gold. He knows exactly what he's doing. I mean, I guess we can get this out of the way. Bitcoin October vibes hinge on Fed rate cutouts, NASDAQ tech stocks response. I think that's the dumbest take I've ever heard. Like, first of all, we know rate cuts are coming. And do we, like, what happened last week doesn't have much to do with red cuts or what happens in the NASDAQ or tech stocks. We got our own little thing going on here.
- [02:07]
B
Yes, there's a lot going on. This is, I think, one of the factors. I think that there are. So, look, it looks like QT is so quantitative tightening is tight, tapering off. In other words, the Fed has been for about three or four years now, reducing its balance sheet. That has a net drag on global liquidity. That looks like it's coming to an end. There's talk about qe, so quantitative easing starting, which would see the US Ramp up more liquidity than it is currently doing. That is more important than the rate cuts. But with the Rate cuts. There's some chance that there's a 50 basis point rate rate cut which is currently not priced in by the market. And I think that would have a significant impact if it were to, were to happen. Let's say there's maybe like an 8% chance of that. But 8% is not nothing. And, and then you know, obviously the global trade war between the world's biggest manufacturer and the world's biggest customer, it looks like another taco trade to me.
- [03:21]
A
Yeah, I mean it, it feels that way. Just interesting to note from that article I had up before, we've still seen 5 billion in inflows into Bitcoin Spot ETFs in October, even though price is currently down 4.3%. I mean, I think literally these are arbitrary time frames. But I find it very interesting that with all the nonsense that happened across crypto over the past few weeks, with price being down, obviously Bitcoin in this case, I think dragged down by leverage, flush outs and cross margin on altcoins, we're still seeing massive, massive, massive buying from retail in America through ETFs and institutions. I don't think they even know what happened last week.
- [04:01]
B
Yeah, I mean, why, why would they? It's, it happened on the weekend and they don't work or trade on the weekend, so. And, and for the most part it was just a blip. Right. The price sort of crashed. First of all, it didn't impact the one asset that they really care about, which is Bitcoin, which, you know, they're not monitoring. I don't know, fart coin and obviously, so, so the fact that, you know, some things like, you know, sue went down to basically zero, probably irrelevant. But also the crazy thing is that if no one told you there was a flash crash and you looked at the charts today, you would have no idea. Right. There's no, the, the, the amount of residual impact is quite low. Open interest has gone down, but only about 20% and is still at near all time highs just because open interest was far above anything it had ever been before. So yes, there was a slight deleveraging, but we're still highly leveraged. Trade volumes have been impacted a little bit, prices have been impacted a little bit, but not nearly as much as Friday or Saturday would have led you to believe. On Friday and Saturday crypto Twitter was full of people saying that they had been wiped out. This probably isn't the case. And even if it were the case, it's clear that that isn't most of the market. Even not Most of the degen market. So the market has for the most part just shrugged this off.
- [05:45]
A
It's crazy though. I mean.
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B
Scott Weir RA losing you.
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A
You can't hear me.
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B
Yeah, yeah, you're good. Yeah, now we're good.
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A
Yeah, I, I just find it crazy that we had 19 over 19 billions in Li liquidations in a matter of hours, which is like 12 FTXs. And here we are as you said, only really a few tens of percents down on open interest. There's still tons of leverage in the system. I mean this is obviously institutional leverage. CME Group records record breaking Q3 2025 crypto driven activity, over 901 billion in volume. That's institutional leverage, right? I mean those are, those are, those are futures volumes. And here we are right back at kind of the price where we started. But maybe we should talk about because I know you have perspective on this. How can you approach this market? What venues can you use? If you actually wanted to trade, where should you do that? It feels like you can't really manage risk if a coin can magically go to zero and back.
- [06:53]
B
Yeah. So look, I mean I think the, the big lesson here, whether or not people will learn it, I don't know. But the big lesson here is that you should not be using these centralized exchange venues. We've learned that lesson in this space. I don't know how many times. You know, Mount gox, ftx, not to mention all of the many, many hundreds of other exchanges which in one way or another have destroyed people's wealth, you know, taken limited their access to their funds, had their APIs drop at the, at the worst possible time. This is not a rare occurrence. Right. We, we treat it like it's a black swan, but it's just a regular swan and it happens every year. So you, by trading on these exchanges, especially with leverage, are picking up pennies in front of an oncoming train and yet it continues. Where are we seeing better alternatives? Well, Tradfi right now is a better alternative. There is crazy deribit have been a pretty solid exchange but they are I think fairly stand out in that respect. And part of the reason that they're a bit have been a standout exchange is because they're dealing with options rather than perps and institutions.
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A
Yeah, and largely institutions. Yeah, yeah.
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B
But the thing is perps are like high frequency trading without the high frequency infrastructure. And options have the advantage of being much, much lower latency. So they're less prone to this kind of problem. So that's one Thing that is happening another thing. So but if you look at tradfi tried financial even on options and, but certainly on futures and ETF options is larger than binance, larger than deribit, larger than any of the sort of so called crypto exchanges and their infrastructure is better. Which kind of sucks. Right. For an industry that's trying to revolutionize finance, the fact that the traditional finance or financial rails are more reliable is an indictment. That said, that is only half of the story. The other half of the story is the defi has been managed now for a good half decade to consistently outperform not only CEXS but also TradFi. And you know, trading lending venues in defi have proven to be more reliable. Now there are exceptions to this. Hyper Liquid was a clear exception of the weekend.
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A
I'm not sure if I even classified these decentralized exchanges as defi per se to me and I guess they are but defi to me is I spoke with. Well it's not even defi but the aves. That's right, the lending markets, the extremely efficient your collateral is there. These are over collateralized or well collateralized loans. They liquidate people efficiently with proper margin calls. You can borrow and you can lend and the smart contract is better than a platform built by these people. But yeah, continue. So I just think there's a difference.
- [10:30]
B
I think that's, that's an excellent point. Right. Because this actually just does go to show that the, the more decentralized, even if they're imperfect, the more decentralized venues are more reliable. And so you know there's this term that has arisen over the last year or two of decentralizing them only Dyno. Right. So hyper Liquid Astera. These are dyno.
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A
Yeah, I mean aster is like it's a centralized exchange.
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B
Yeah. So, so you know it's, it can feel a lot of the time like oh why does this even matter? You know the, the user base, the customer base doesn't care about these things. But people who care about actually holding on to their, you know, capital and whatever assets that you hold should care about this because it really makes a very, very big difference. So, so I think the, the lesson here is that if you are going to be utilizing these, these systems, you have to take into account these risks and you have to take into account venue risk as well. Now what we've started to see is the emergence of off exchange services. Now this is not open to retail yet and I think most retail or sort of regular people aren't even aware that this is a possibility. But larger institutional traders, when they're trading on most exchanges, and to a degree this is even being forced on Binance, they're not holding their BTC or their ether, their tokens on the exchange, they're not sending those funds to an exchange, they're holding them off exchange. And there's now an emerging set of custodians like Fireblocks, like Copper, who have agreements with exchanges that you, you can as an institution hold your funds off exchange and not take on the counterparty risk of the exchange, but still get credited with the assets to trade on the exchange and then you net out any differences one or two or three times a day. This helps protect you against a flash crash as well. Right? Because if there is a flash crash and the exchange comes to you and says, listen, we liquidated your position because our API wasn't working and our risk models weren't working and just we were having a bad day, we didn't know.
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A
The prices of the assets that day.
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B
I'm sorry, yeah, you can push back, right? Which is something that as a user who has sent your funds to Binance, to Bybit, to ftx, there's nothing you can do to push back if they lose those funds or if they screw up those funds. So there's a huge amount of maturing that we still need to do as an industry. And, and I think the bottom line for me in all of this is this is why building decentralized tools for Bitcoin in particular is so important. Because Bitcoin is the heart of the, the market, right? 60% of all of the assets, you know, 40% of all of the trade volume is Bitcoin. And so we can't see maturation outside of tradfi until we get true decentralized systems and defi for Bitcoin, which is why this has been an obsession for me for almost a decade now.
- [14:03]
A
Yeah, there's a lot to unpack. But clearly there's the counterparty risk that leverage is supposed to solve that clearly it did not. Right. The argument used to be, hey, listen, if I have a stop loss that's less than 10% from price and I'm trading, then 10x leverage is actually eliminating counterparty risk from an exchange. Because I can put a tenth of the bitcoin on there, right? If I want to make a 10 bitcoin trade, I can use one bitcoin. As long as I have a stop loss, it doesn't matter if it's 100x10x whatever. But now you can't handicap that counterparty risk that you're supposed to be protected from. Yeah, you just can't. Like not after what we just saw. You can't.
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B
Yeah. And also before what we just saw, like what we saw, and I think that's the main thing, is not that unusual. It was bigger, but it happens every.
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A
Year, certainly every couple years at the very least. And what else seems to be happening every couple years is this.
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B
I mean just last year, what happened last year? Last year Bybit got hacked.
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A
Yeah, the hack.
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B
This is not a rare occurrence.
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A
Absolutely. Another not rare occurrence. Billions in bitcoin seized by DOJ for massive pig butchering crypto scam in Cambodia. So I brought this up yesterday. We haven't really had an opportunity to talk about it. Assuming we still have all the Silk Road coins and Bitfinex coins and all that that brings the United States holdings according to cryptoquant and I didn't even know they had these coins yet, but. 316,760, 35 billion. One of the largest bitcoin holders. That's a third of the way to the strategic bitcoin reserve proposed by Lu. That was a million Bitcoin in like five or 10 years, whatever it is. But well, yeah, we don't need budget neutral ways to buy bitcoin if we can just go around the world and take criminals that aren't even scamming United States citizens or anything to do with the United States and just take their stuff.
- [15:52]
B
Listen, you're totally right and I think we could definitely talk about the bitcoin angle of this story. But for a moment I just want to talk about the human interest aspect of the story. What was going on in Cambodia is that they had sweatshops full of basically Cambodian slaves who were being forced to reach out to people across the world and scam them by begging for money or convincing them that they had a romantic online relationship or whatever. So they had these switch ups of, of various types, like Nigerian scams, but out of Cambodia. And, and, and, and the people who are running the scams, which, you know, two years from now this, you'll have switch ups doing it with AI, but, but up until now it was Cambodians. But the thing is, right, these different scams, right, which, which they were calling slaughtering the pig. What is the pig? The pig is your mark, right? Like convincing some dudes that you were a woman and that you, you know, you guys were going to get married. Convincing somebody else that you alone to get to America or whatever. They amassed $15 billion. They were making 30 million.
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A
30 million a year. At one point, I think it was 30 million a day. Yeah, that day.
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B
I mean, that's nuts. And so, so you wonder, like, how. How big is the DJ market? There's a sucker one every minute possible. It's, it's, it's nuts.
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A
It doesn't make any sense to me. I, I just don't even comprehend those numbers. I mean, I'm, I'm old enough to remember when a billion dollars is a lot of money.
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B
Yeah.
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A
I mean, by the way, this guy's still on the run at one point.
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B
You have to make $30 million a day for years.
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A
Yeah. I mean, this guy is still on the run with 1.8 billion in the wallet. According to, According to this, like a casual 1.8 billion. If that's all he cashed out and he gets to escape, it seems like he still did pretty good. But I'm. Well, I'm really failing to comprehend how the United States has anything to do with this and just gets to take this.
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B
That I don't understand. But, you know, the. The strong do what what they can and the weak suffer what they must.
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A
Is any citizen, Chinese citizen, Cambodian, sweatshop victims all around the world. Very unlikely. Most of those are Americans. This money will never go back to those victims because they'll never find them. Those people would never even know how to report this. Or maybe too embarrassed. This is just free bitcoin for our strategic bitcoin reserve.
- [18:38]
B
I don't know about our. But yes.
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A
I happen to live in the greatest country in the world with the greatest economy and the best everything. And so I get to claim that. I also get to claim apparently, like $100,000 per household in national debt. So I guess it's. It goes the other way as well, now that we're, you know, just adding trillions and trillions and trillions at a time.
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B
I think you'll find that it's closer to $300,000 per household in national debt. But, you know, what's a few hundred thousand between friends?
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A
Hey, and listen, while the United States is cashing in on pig butchering, the Trumps, according to Eric Trump, have made more than a billion bucks already in crypto. Yeah.
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B
Of which they're keeping about 6 or, sorry, 7 or 800 million in Bitcoin. So they're building up their strategic reserve.
- [19:33]
A
That is very true. So listen, he also, when we're speaking of the Trumps, he said, Eric Trump confirms plans to Tokenize real estate. With World Liberty Financial we have them talking about tokenization. Larry Fink this Week said that BlackRock is building their own entire platform for tokenization. Tokenization of real world assets is absolutely coming. I'm assuming that with Bitcoin OS that's one of the things on the roadmap or on the radar for this to happen on Bitcoin.
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B
Yeah, absolutely.
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A
Talk about that.
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B
This is a fast growing market. It's gone from 3 billion to 30 billion over the last two years. In terms of tokenized sort of real world assets within crypto, that's 10x growth in two years. That's nuts. Actually, just to give you a sense of just how nuts that is, it's slightly faster. It took 3 years for OpenAI to 10x their revenues. It took 2 years for real world assets to increase by 10x and roughly the same numbers. So open AI going from 2 to 20 billion, real world assets going from 3 to 30.
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A
So.
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B
It'S, it's a much bigger deal than I think most people realize. And the number one chain where people want to have long term significant asset holdings is Bitcoin. With boss, with Bitcoin os, we're building the, and bringing now to market just in a few months we'll be bringing to market the technologies that allow this to, to be a possibility for the first time. And so that means that you can have stable coins, the US dollar, Treasury bills, real world assets like real estate, all secured, traded, settled and maintained on a ledger. That is Bitcoin. So the strategic importance of Bitcoin goes far beyond BTC and is going to become a means for everyone and in particular the US government to be able to continue to expand the potential market for US assets globally. Probably most people know that the US stock market has outperformed the global stock market by about 3%, by 30%. Right in terms of the delta over the last 30 years. A big reason for that is people want to denominate their assets in dollars and people want to be where the property rights globally are strongest. Well, over time more and more people are looking to denominate their holdings in btc and the strongest property rights in the world are provided by the Bitcoin network. Not only that, the US is sort of trying to partner or, or become a primary user of Bitcoin so that it can continue to hold sort of the, the, the, the, the, this crown of, of, of providing the world's best property rights and therefore sucking in the world's capital. So I think this match between bitcoin and the, the, the, the U.S. sort of geopolitical economy is only going to strengthen from here.
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A
I'm still blown away that we don't have an extremely viable and popular stable coin on Bitcoin.
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B
Well, we're getting there. The technology is only now starting to emerge. I think with BOSS we've been at the forefront of making this happen. But part of the reason this is taking longer with Bitcoin is because it's being done properly, right? So if you look at Ethereum, you look at Solana, all of these systems, they feel like software. They're constantly being upgraded, they constantly have scaling issues. The way that it's being built into Bitcoin is going to allow Bitcoin to act as the financial layer for the world in the same way that TCP IP acts as the base protocol for the Internet. TCPIP does not change, but it is highly scalable because of all the systems built around it. And that's the engineering model we've taken with Bitcoin. We're building for forever.
- [23:57]
A
And the adoption is inevitably coming. I mean we talk about the tokenization of real world assets, but I mean the largest companies in the world here are expanding their crypto payment solutions. Everybody's rushing in. Bancorp announced to form a new unit focus on bitcoin and crypto. I mean these stories are dime a dozen. They're almost non stories individually. But it does tell the story of the inevitable adoption of stablecoins and then anything tokenized, right? Because that's the people don't realize it. But I mean stablecoins are the first and best use case of tokenized real world assets. Is a tokenized real world asset.
- [24:34]
B
Absolutely. They're the gateway drug for real world assets. I think a lot of people sort of ask why isn't retail in crypto? Why hasn't this bull market sort of followed the trend of other post halving markets? And a big part of the story which I think isn't mentioned enough is that a lot of the hype has been sucked away from crypto and into AI.
- [24:59]
A
Right?
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B
There's a new big narrative that people are focused on. But I think the crazy thing is that actually the best way to invest in AI, right is through Bitcoin. And it's not because of like the silly, oh, the agents are going to, you know, AI agents are going to be transacting in Bitcoin. That might happen, but that's not actually the crucial part. The crucial point is that if AI is successful and you know there's no point in making that investment if you think AI is not going to be successful. But if you think AI is going to be successful, what that does is it significantly increases global productivity rates, it significantly reduces the value of human labor. And, and, and, and, and it will increase the amount of capital in the world because there'll just be far more credit and far more things being produced and as a result more money being printed. But at the same time it turns the big technology companies into commodity providers, right? They have to have these mech. They go from basically being capex, capex low companies, right to companies that are very hardware heavy, massive. They're building out their own data centers, they're building out their own electric power stations. There's currently in Texas just one of these companies with one of their data centers is building out a data center farm so large it is as large as the island of Manhattan and has 10 power stations that they're building just themselves. So the capex is intense. And so what happens is these companies are going to go from extremely high margin software to providers to extremely low margin commodity compute providers.
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A
So it'll be accounted for, I guess, which will be accounted for in size. It'll be so big that the small.
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B
But look at, we've seen this before, right? You can have very, very large companies like Boeing and Airbus are very, very large companies, right, with, with hundreds of thousands of employees, but they're worth, both of them together are worth less than Home Depot. And the reason is they're not very profitable. Their margins are low. So these, so what's compute is being commoditized, intelligence is being commoditized. We're going to see massive increases in both competition reducing profits, but also productivity increasing the amount of money. And so where is all of the value in the world going to accrue? It's going to accrue to the one thing which is going to remain scarce and digital and that is Bitcoin. And so the crazy thing is I think the bet for the next 10, 20 years, if you think AI is going to be successful, is that the way you're going to actually collect, you know, accrue the value, extract the value from the world is by owning the one thing that is going to remain scarce in an AI world and the only thing that remains scarce in an AI world is bitcoin.
- [28:09]
A
I love that. What a good way to end Iago. I mean before we do end, like maybe just give the quick update on where Bitcoin OS is on the timeline. Right now.
- [28:20]
B
We'Ve got very big news coming in the next few weeks. We're going to be launching the system in just a few weeks. The bus token is going to be launching in just a few weeks and things are going to start going a bit crazy.
- [28:37]
A
Can't wait. Awesome. Everybody, you can give Yago a follow obviously check out Bitcoin Os which he has been diligently a part of building for a very long time here and we don't talk about enough on the show to be quite honest.
- [28:49]
B
Well we can do it maybe next week or the week after we can do a special just about this.
- [28:55]
A
Yeah well maybe we'll just do like one of the hour long recorded Sunday things like good old times and really dig into that single topic. I think that would be great. All right, we're going to do that. We'll talk offline about it. Everybody else, I'll be back tomorrow with the Friday 5. Yago, thanks so much man.
- [29:09]
B
Thank you very much. Have a good one. Let's do.