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The Wolf Of All Streets
Bitcoin Strategic Reserve: Is The USA Taking Over Crypto?
00:51:47
Bitcoin Strategic Reserve: Is The USA Taking Over Crypto?
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- [00:01]
Scott Melker
By executive order, the United States of America has a strategic bitcoin reserve and digital asset stockpile. Let me say that again. The United States of America has a bitcoin strategic reserve and a digital asset stockpile. Of course, that did not stop degenerate gamblers from selling the news because they viewed it as bearish. And believe it or not, this is just one of the huge stories for, for this week. NLW is away today, so I brought in a special guest to break down the Friday 5. Your favorite in mind, Dave Weisberger. This is going to be amazing. Let's go.
- [00:39]
Dave Weisberger
Let's do.
- [00:53]
Scott Melker
What is up, everybody? I'm Scott Melker, also known as the Wolf of Allstreets. Before we get started, please subscribe to the channel and hit that like button. What an absolute massive, massive day yesterday was for bitcoin, for crypto, for our industry, for vindication. Absolutely insane. And preempting the huge digital asset summit at the White House today where we thought we would get clarity on a strategic bitcoin reserve. Going to go ahead and bring on Dave right now. Let's just, I mean, let's break it down. For those who didn't see it. It came by announcement from David Sachs on X. Just a few minutes ago, President Trump signed an executive order to establish a strategic bitcoin reserve. Of course, we have it right here. Dave, how in the world could people in our industry be bearish on this and upset?
- [01:51]
Dave Weisberger
Well, because there's a lot of morons out there, Scott. Thank you. It's like I'm reading a tweet from this guy, Justin Beckler, who's taking victory laps because he's claiming, I told you they would never buy bitcoin. And I'm almost stupefied by how dumb it is. I mean, in the, the actual text, and it's amazing that it's there. I mean, in the actual text of the order, in addition to the fact that we, we thought that you were going to get a strategic stockpile and it was going to have all sorts of crap in it, including bitcoin. Now, you have a separate bitcoin strategic reserve and a digital asset stockpile. But in the bitcoin one, it specifically says that, it says the Secretary of the treasury may determine strategies for responsible stewardship. And it says, and it authorizes where are we get together?
- [02:42]
Scott Melker
Right.
- [02:42]
Dave Weisberger
The secretaries of treasury and Commerce are authorized to develop budget neutral strategies for acquiring additional Bitcoin, provided those strategies impose no incremental cost on American taxpayers. Now, people in the crypto World might read that and say that doesn't matter. Oh, look, they're not buying bitcoin. They have.
- [02:59]
Scott Melker
They can buy bitcoin.
- [03:00]
Dave Weisberger
You understand what a pay for is? Anybody do just the slightest amount of research. Morons. What a pay for means. In Washington, D.C. a pay for could be very, very obtuse. This literally says if they decide they want to sell them MBSs that were acquired as part, you know, well, I was by the Federal Reserve, which is a private company, but we'll see. You know how we consider what balance sheets are. But effectively, once they have assets to convert it into bitcoin, they can do so if that's what they think makes sense. All they can't do is use the general account of the federal government to go out and buy bitcoin in the open market, okay?
- [03:42]
Scott Melker
And by the way, nobody in their right mind really wanted the United States to print more money and run up the debt to buy more bitcoin. So this is the most pragmatic, responsible way for them to present this as bitcoiners. This executive order, I'm sorry, is perfect. It is literally perfect. And proves once again that we wasted endless time debating what would happen when we could have just waited for it to actually happen. Given Trump, you know, he makes a lot of comments. It causes a lot of confusion. But what we got here, as you said, strategic Bitcoin reserve, that will only be bitcoin. A demand that they audit the amount of bitcoin and digital assets that we have, which is very, very important. Saying we will not sell anymore. Coming on the heels of Sachs's tweet yesterday showing that the United States government had effectively lost $17 billion by selling Bitcoin too early. Clarity on a digital asset stockpile. Now, altcoiners, I could see you being very upset if you thought that the United States government was going to buy Cardano, XRP or Solana because they hold very little and they're not going to add anymore. And then of course, the clarity that you said coming from how we can go ahead and get more bitcoin. I don't know if you saw this, but then Besant went on the roadshow this morning on CNBC and talked about this. These were his quick quotes. First thing to do is stop government bitcoin selling. We'll see what the way forward is for any bitcoin acquisition. Need to bring bitcoin offshore.
- [05:10]
Dave Weisberger
I mean, it is. It's literally the adults are running the show. I mean, it's hard for me to believe that I'M uttering these words because of the chaos of the first Trump administration, but the team he has put in place is literally great. You know, David Sacks obviously knows what he's doing. I find it hysterical that Elizabeth Warren is whining about his conflicts of interest, despite the fact that he sold everything and made it very, very clear. These are people who love America, love our country and want to help it, and actually have taken financial, arguably financial, you know, drags on what their, their net worths are for doing so. And the person who has made almost, you know, tens of millions of dollars as a senator leveraging her public service into personal wealth is the one criticizing them. It's truly bizarre. But what's interesting is to think about what we were talking about last week, and I've done two videos on this and we talked about it on Monday. We had a Sunday tweet which we all thought was really bad for a lot of reasons, the Eric Trump tweet. And I don't want to re litigate that, but the idea wasn't great. But now here, what we do, we actually have is a policy that is more or less what most of the people in the, certainly bitcoiners and certainly even in the crypto community, the more senior people wanted to see. They want to see a measured, intelligent approach. And that's exactly what this is. So I don't know what more is going to come out of today's meeting, but, you know, this to me is a very big deal. And I want to make one other point because people don't, they don't understand investing or they don't understand how investments work. Most of the assets in the world, the largest pools of assets are run by pension funds. We all know that, right? There's a big. A lot of assets are run individually through people called registered investment advisors or financial advisors, and they have different names in different countries. But pension funds are the largest pools of capital. Sovereign wealth are big pools of capital. Pension funds don't invest in normal assets without investment consultants clearing the way for them to do so. A lot of pension funds, not all, but actually a minority, but, but not, you know, quite a. There's a lot of money are in alternative assets, but the alternative asset section is dramatically lower than the normal asset section. What this order does is clears the way gives what we, we would call air cover to investment consultants to start considering Bitcoin as a normal asset. It uses words like store of value. It uses actually codifies by the White House calling it digital gold and gold by the way is considered a normal asset. So ask yourself the question, what happens? And these, these organizations move slowly. This is not something that happens immediately. But what happens when the largest investment pension consultants tell their funds that you really should have an allocation to Bitcoin as part of your portfolio allocation problem.
- [08:23]
Scott Melker
BlackRock literally did that this week. They put it into their model portfolio and recommended 1 to 3%.
- [08:29]
Dave Weisberger
Right. And that is not a small deal. And when you talk, and you had Matt Hogan on and he did a better job than I'm going to talking about why that matters. The truth is this creates a significant impetus towards what we always talk about, which is the gaining of global acceptance of bitcoin as a store of value. And if you don't signpost that or understand that, then you're not paying attention.
- [08:55]
Scott Melker
And there's no greater stamp of approval than the United States government saying that it's a strategic reserve asset. I actually wrote a long newsletter about it this morning. I'm sure most of you are subscribed, but I have a free newsletter you can subscribe to. Goes out five days a week. But I think the important part here to remember is that game theory is now in play because this is the one thing that we haven't talked about. The United states holds roughly 200,000 bitcoin. Right? With a smathering of other digital assets, it's important to remember about 96 to 100,000 depending on how many were recovered of those are bitfinexes. Right? And Bitfinex should get that bitcoin back. That's basically like as we've given the example before, if somebody came into your house, stole your wife's diamond ring, the police confiscated the ring from the person who stole it. That's like the police saying that that ring is. Now there's the United States having this bitcoin from Bitfinex. That should go back. That puts the United states at roughly 100,000 or maybe even slightly sub 100,000 bitcoin. China has 194,000 bitcoin. It's already being reported that today there are closed door meetings in China discussing a strategic bitcoin reserve. There is no way that China doesn't take notice here. Every country in the world doesn't take notice. And that the United States then is not forced to make sure we have more bitcoin than China.
- [10:13]
Dave Weisberger
All I'll say is the exact. From the White House press release. Bitcoin, the original cryptocurrency, is referred to as digital gold because of its scarcity and security. Having never been hacked. And by the way, though, that line is obviously in there to reassure people because of the Bybit hack and other stuff.
- [10:30]
Scott Melker
Right.
- [10:30]
Dave Weisberger
And then the next line, with a fixed supply of 21 million coins, there is a strategic advantage to being among the first nations to create a strategic Bitcoin reserve. They're not. This isn't subtle. They didn't. This isn't subtext. This is, this is what they're saying, Scott. And people need to understand this matters. And if you understand how government works, you understand that this is there. Now, I wouldn't expect, and I've said it many times, even if they were going to figure out a way to buy bitcoin on the open market and, and who knows? I mean, you know, it could be via the Federal Reserve. As I said, pay fors in DC Are one of the, one of the, the biggest mysteries of life. Even if they were going to do it, they would certainly not tell you about it until after they've done it. That's all you got to know.
- [11:15]
Scott Melker
I just, I'm so astounded at how dumb humans are. I mean, you said at the, at the beginning, better I want to actually play the clip. It's one minute of Trump signing this executive order. It's just worth having on the show so that we could codify this in the history of the Wolf of all streets here.
- [11:33]
Donald Trump
Signing this is very historic. And executive order establishing a strategic Bitcoin reserve and digital asset stockpile. This is a promise that you made throughout the campaign, and today we're keeping that promise. The reserve will be capitalized with bitcoin that the federal government already owns, so it won't cost taxpayers a dime. This is like a digital Fort Knox for digital gold. And premature sales of bitcoin over the past years cost American taxpayers over $17 billion in lost value because we didn't have a long term firm strategy right now we do.
- [12:04]
Dave Weisberger
So.
- [12:05]
Scott Melker
And this is something you believe in 100. Yeah.
- [12:07]
Dave Weisberger
Okay. And the whole community believes in it. Very good.
- [12:09]
Scott Melker
And I made the promise. Right?
- [12:11]
Donald Trump
Absolutely.
- [12:13]
Scott Melker
I mean, there it is. Yeah. I'm sorry, I don't care who. Whether you like the President. You don't like the President. If you've been here a long time and you can zoom back to 12 months or 18 months or 24 months ago, before we even had Bitcoin spot ETFs. And those were a glimmer in the eye of a dreamer. The fact that we're now fully institutionalized with Bitcoin spot ETFs and now have the stamp of approval of the United States government as a strategic asset is beyond any expectation I honestly ever had for bitcoin, period, when I got into this. It's just crazy.
- [12:50]
Dave Weisberger
I mean, Scott, look, I've said it many times. You've heard me say it a million times. We actually laugh about how often I say it, that bitcoin's price is a function of the fact that it's an option on its own adoption. Now understand adoption. What are we talking about here? It's an option because we say that the market value of gold that's due to its monetary value is a very large percentage of its market cap. Right. And why do we say that? I mean, things like gold is trades at double the price of platinum despite being 1/30, it's rarity in the earth. Platinum is much rarer. I mean, I got the, the divisors wrong, but you got the idea. I mean, platinum is much rarer, more prized in jewelry in many respects. I mean, my wife certainly wanted platinum in her engagement ring, but gold is more expensive. Now why? It's because gold is a monetary asset. It's a melting monetary asset, though, because it's supply, it's. It's representation of total monetary assets has decreased substantially. I mean, it was close to 100 at one point. It's now down below 7% or something of thereabouts. I don't know. I haven't checked in the last couple of days. Bitcoin is better than gold in every single dimension of monetary assets. It is more provably scarce. It is easier to verify. It is far more efficient to transact with. It is more durable and cheaper to store and hold. It is more divisible or easier to divide, is almost impossible to counterfeit, and it's a hell of a lot cheaper to verify it than gold. And in the digital economy, it's a native digital asset. So people say, well, yeah, that's great, but do people really accept it? I don't see people putting bitcoin around their neck and holding it. I don't see bitcoin in safe deposit boxes and they're holding it except for the fact that acceptance has been growing rapidly. Right. And so now, in addition to Paul Tudor Jones a few years ago saying it's the fastest horse in the race, and most of the smart hedge funds that I know have been accumulating, it's now we have not just the President of the United States, but the official policy of the government of the United States that says it's accepted. I mean, I'm droning on, but it.
- [15:07]
Scott Melker
To me, it's just astounding.
- [15:09]
Dave Weisberger
It's going to be. People are going to look back 10 years from now and say, how the hell did it take that long for Bitcoin to get to this price with this news? And the answer is a combination of things. But one of the reasons is because it's been trading for 15 years. It has a technical. You know, basically there are technical trading. There are technical traders out there. You're a technical trader, except for there's a difference in the way that you trade and the way that a lot of people do. There are people who rely on charts like it's slavish to their religion. That's all they do. And they trade on the charts alone. And if you do that, you lose money and you're out of the business quickly. And there are others who understand the charts are important for inflection points, but that those inflection points are often guided by macro events and guided, guided by what's happening. And if you don't understand the two, then you're wrong. And what the technical situation today tells me is, look, you know, you're going to be caught by surprise when big pools of money come in. And because they're just, it's, it's. I think you're, you know, Noel, obviously she substituted for you a couple of times recently on our show, but Noelle had it, said it really, really well. And I give her, give her credit for this. She said, what's the catalyst? The catalyst is selling exhaustion. Right? The people stopping, not selling Bitcoin to buy Pepe or other meme coins or play in crypto assets. They don't even know what they do, but they understand that, hey, there's momentum in it. That, to me, is the catalyst.
- [16:42]
Scott Melker
Yeah, I mean, we have to move on from the strategic reserve, obviously, here. Interestingly, Lummis had said a state's going to do this first. Right. And she's actually correct when it comes to legislation, most likely. And there's still debate as to how this executive order will be actually put into effect and what legislation or congressional approval will be needed. Although if they're not going to spend money, there shouldn't be any. And that's why this executive order is so perfect. But just ahead of this announcement yesterday, you guys may have missed this at the news cycle. Texas surges in US States race to put public funds into crypto. Their bill, SB21, passed the Senate 25 to 5, moving a strategic bitcoin reserve ahead to the House. And if it passes the House, which it likely will because it's wildly dominated by Republicans, then it goes to Abbott for a signature by the governor and we get a Texas strategic bitcoin reserve. This all happened in the exact same day.
- [17:44]
Dave Weisberger
I mean, their mechanism, which is allowing tax receipts in bitcoin will probably mean it will start slow. But we also know, and this is why this is sort of like pouring gasoline or an accelerant into a place that you want to burn and then wait for the match. The match would be the US Doing something in terms of tax policy. And we don't know what's going to be talked about in tax policy. You and I have talked about it enough to know that I don't even want to speculate on this show because by Monday we're going to see what the proposal is going to be for tax policy because we're going to get it later. But the two together could be. Be wildly bullish or at a barrier minimum. Once again, another proof point for acceptance.
- [18:33]
Scott Melker
I'm just happening to look at the bitcoin chart from yesterday because the price action we moved on from. I just have to bring this up. This is a 15 minute chart and price went down $6671 in less than 45 minutes on the announcement. I just want you guys to see that because the absurdity, it just blows my mind all the way back up basically to where it started here. But absolutely absurd. Getting a big. Yeah, go ahead.
- [18:58]
Dave Weisberger
I was gonna say I was sitting watching TV with my wife. We're watching. We're binging Dexter. Which is. Which I actually really like the show I had never seen.
- [19:07]
Scott Melker
Especially if you live in Miami. Yeah.
- [19:09]
Dave Weisberger
And especially we get to watch the. Oh, I know where that place is. But I saw the candle down and I'm thinking, and I'm looking at the amount of cascading liquidations and I'm thinking, boy, these people are stupid. And the ones who got forced liqu. The longs that got force liquidated are going to have such severe fomo, it's crazy. I, I actually wanted to. To post something, but I, I didn't. I didn't pull the trigger. I did say to you, maybe you'll be lucky and get to buy at those. Those lower levels again.
- [19:36]
Scott Melker
But I don't think so.
- [19:37]
Dave Weisberger
I don't think so is. I thought that, that, that a v bottom off of that was one of the more obvious things. I mean, we always talk about this initial news, the knee Jerk reaction is always wrong. But what's important is not only is it wrong, but it usually shows where the next impulse is going to be. And it's usually the opposite impulse may not be immediate. So, you know, it's the same thing with Federal Reserve announcements and this announcement. I guess people saw the one line we're not going to buy and I don't know. I literally don't know.
- [20:10]
Scott Melker
The reason they saw that though, is because a bunch of idiots in our industry parroted that as the key line. Because people literally are just miserable and cannot be happy and want to remain in misery. I'm sorry, I don't.
- [20:23]
Dave Weisberger
I think there are a lot of. We have this, this. The crypto industry has. It has been gradually getting more people who are adults in the room who understand how investments work, understand that a 10 times, you know, basically a 10x is something that you dream about. And yeah, you might, if you're in a VC or if you're really lucky, get that, that stupid, you know, hundred thousand, ten thousand x kind of kind of rally. But if you chase those, what are you chasing? You're chasing lottery tickets to get somebody who gives you the ev. Basically. Buying bitcoin now is actually statistically better odds in my point than going all in with pocket aces against a random hand.
- [21:05]
Scott Melker
Sure.
- [21:06]
Dave Weisberger
When you. And knowing you're going to be called getting to call all in against a random hand, you don't win every time in that. But your expected value if you get to do that a lot is unbelievably high to me. It's just all you got to do is shrug your shoulders and understand that the world is confused by bitcoin and the bit. And the crypto world is in always in pursuit of a quick buck and over leverage and get themselves done. So when people see that leverage, then they can wipe it out and buy cheaper. They'll do so until there's a way, until people stop falling into the same trap. It's like there's a pit. They don't even bother to throw to throw the trees and branches over the pit anymore. They just kind of put the pit out there and let people walk into it. It's crazy.
- [21:52]
Scott Melker
Absolutely. So listen, that was more time than we usually spend on a single sort of story on the Friday 5. But I would argue it's the most impactful that we've generally had and ties right into a similar but connected story, which is obviously the crypto summit today. Right. So we have the article here. Being positioned by Bloomberg as the crypto Glitterati flocked to White House as Trump Orders Bitcoin Reserve Digital Assets STOCKPILE so what's notable here is that in Lutnick's comments earlier this week, he said that we would get clarity on the strategic Bitcoin reserve on Friday, likely at this meeting. Trump and Sachs preempted that yesterday. Which leaves a lot of people wondering if this will just be, as we've described it, a circle jerk of a bunch of people sitting in the White House. As I've said before, when you get 20 powerful rich people together in a room for four hours, how much productivity do you usually get? I have no idea. So now I think what's on the docket? The big question mark for people is will we get clarity on taxes? Because there's been conjecture that there would be no capital gains on bitcoin held over a year or even potentially on crypto assets made in the usa. We have a lot of conjecture as of right now. We also have this list right now that's seemingly changing all the time as to who's going to be there, but it looks like we're going to get a pretty good cross section of CEOs from the industry. A couple bitcoiners like David Bailey and Michael Saylor, and then a couple VCs, wallet owner, and then a few builders like Sergey Nazarov, obviously from Chainlink. I think this is an absolutely great list. People are pissed off. There's not enough bitcoiners, as usual. But the bottom line is this is another one of those sort of promises made, promises kept situations where we're clearly advancing the ball further on the White House's intention to work with the industry given. Funny to note, we were supposed to get a White House counsel in general, and that just didn't happen because our lobbyists can't agree and are all fighting at each other's throats. But at least we're getting these summits.
- [24:02]
Dave Weisberger
Bloomberg's title basically still betrays the fact that they still are anti crypto. We know that the Wall Street Journal had an article about crypto today which talk which was, you know, it has that, that anti crypto lens. These things are starting to. But they're much more subtle than they were a year ago when it comes to getting all those people in the room. I mean, look, there are some very good people in that room and some people who have been early and who understand, et cetera, and there are others in that room who are there to push their bags. And I'm not going to say who is which? Because it doesn't really matter. The honest truth is it's irrelevant. What matters is the symbolism of that, of the industry being recognized and the asset class being recognized. To me, what matters is what policy prescriptions they talk about and say. And I strongly suspect that it's more listening and allowing people to feel like they're in the seat. It's sort of like when you go, and I've done this a couple times, when you get to ring the bell at the New York Stock Exchange, you know, you don't do anything. You're standing there, you get your picture, you're on tv and they ring the bell and it's like, okay, great. And IPO people do that. I've been there with a couple of charitable organizations, but it's, it's really. It's a photo op. And that's what this is. Now, I, I've said this before. I do think the announcement that came out last night is very notable. And. But the, the actual summit will be, you know, interesting. I'll be surprised, and I'd be very surprised if anything newsworthy comes out of it.
- [25:40]
Scott Melker
Yeah, I agree at this point, because what we were looking for to be newsworthy, we got yesterday in spades. So I think that was, you know, a little bit of Trump and Sack stealing the thunder of this meeting. But we got exactly what we wanted, so be happy. And since we have to stay on Capitol Hill for literally everything crypto related right now, this story kind of went unnoticed. Effort to kill IRS crypto. Yeah. Effort to kill IRS crypto rule clears U.S. senate hurdle with a split among Democrats, a Senate resolution to erase the IRS DeFi focused crypto broker rule passed with a massive majority and is now up to the House. I have no idea what will happen to the House, but I'll give you my highlights from this. For those who don't remember, this is the rule that effectively forced protocols defi to be considered brokers and to report and KYC and aml, all the things that are literally impossible if you're running something decentralized. This was quietly a part of the huge infrastructure bill that Biden passed. So for those who don't remember, we covered it extensively, but this was basically two sentences thrown into the massive infrastructure bill that they thought we wouldn't notice. And that was the biggest piece of legislation Biden was trying to push through in his entire presidency. And it got completely blocked and frozen for almost two weeks because of these two lines about the crypto industry. And you can look back at that as potentially the singular moment when the crypto industry truly, truly turned on Biden and galvanized to defeat him.
- [27:12]
Dave Weisberger
It's exactly correct. And I'll never forget. It was. It was, you know, the. The senator from Alabama who allowed it to go through. And people finally, you know, didn't go completely crazy because the statement at the time was, yeah, but when they do the actual rules, we'll be able to fight it then. And this is the end of that fight. This is basically saying, okay, no, literally no. And the world will come to grips with the notion that code can't be regulated as humans. This is the first official United States government action that recognizes that code can't be regulated as humans. It's not as pure as you. As some people might want, but it is a very big deal because it's exactly what is necessary in order to disintermediate human rent seekers, which is economic speak for people who take extra margin out of what should be a seamless transaction. And in this particular case, this is a very big deal for defi. It seems pretty obvious it's going to pass the House and get signed at this point.
- [28:16]
Scott Melker
Yeah. The big news here is how many Democrats voted for it.
- [28:19]
Dave Weisberger
Right.
- [28:20]
Scott Melker
So this passed with pretty bipartisan report. It was almost an even split on Democrats, obviously all the Republicans, which is a huge change from the first time these things were proposed. It's becoming very politically unpalatable to be a part of the anti crypto army. And for once, politicians are seemingly just starting to look at these things as what is or is not reasonable and not what is or is not political and just making the right decision. This alongside everything we're seeing at the sec, all of the cases dropped. The approach that's going to be taken there to eliminate fraud, but not entrepreneurship. It's just yet another story in this long sequence of things going the right way for us.
- [29:00]
Dave Weisberger
We're being given an opportunity.
- [29:03]
Scott Melker
Let's not ruin it on meme points. But yes, we are being given.
- [29:06]
Dave Weisberger
You can see what's going on. I mean, you know, this and SAB 21 being, or 121 being repealed are very, very clear indications that we will get stablecoin rules, we will get a market structure bill. There will be wrangling. We're going to need. No one's going to do the market structure until Paul Atkins and Brian Kintens are sitting in their seats and have a pathway to work together. But it's, it's inevitable. This is. We are now pushing rocks downhills, not pushing rocks up a hill anymore, and that's a very big difference.
- [29:39]
Scott Melker
Pebbles instead of boulders, hopefully. Right. But someone who's starting to have to push their rocks uphill and certainly up a volcano. El Salvador. IMF has El Salvador to stop public sector bitcoin buys for $1.4 billion deal. The IMF has issued new requests under its 1.5 billion deal with El Salvador, aiming to restrict bitcoin purchases by the public sector. This obviously notable because the IMF was not going to give El Salvador money because of bitcoin initially. Then they agreed to a deal, but bitcoin basically had to back off the legal tender argument or certainly forcing people to accept it, and had to basically abolish the chivo wallet to some degree. But there was nothing in it about their ability to continue to buy Bitcoin. The IMF now saying if you want your 1.4 billion, you have to stop all public sector buying of bitcoin. Notable that this is only $1.4 billion, like a rounding error on our national debt on any given day, but a very big deal for a country like El Salvador. But then of course, immediately Bukele says, yeah, f you we're going to keep buying bitcoin and does. So where does this, where does this stand?
- [30:49]
Dave Weisberger
It's a game of chicken. But the IMF gets a lot of funding from the United States.
- [30:57]
Scott Melker
Agency, let's be real.
- [30:58]
Dave Weisberger
And it's, we'll see. There's a lot of politics that we don't know that's going on behind the scenes about this. Bukele, I don't think is willing to stand up to them in that sense if he doesn't have some assurances that, hey, you know, come on, they have to say these things because that's what they believe in that, you know, but. And a lot of bitcoiners will say, well, you know, f the imf, yada yada yada, you know, they're, they're, they're the regime of the fiat regime, yada yada yada. You could talk about it a lot. I actually am very sympathetic to a lot of those arguments, but there's some politics going on here. Eventually. This is, it's not the final boss because the final boss is, is, is going to be, is going to be different. It's not going to be the people who are loaning to the poorer countries because bitcoin is going to radiate out. And you know, you've seen what Bhutan is doing. We know what the US has done. And so I think geopolitically you're going to see a growing acceptance here and I don't believe Bukele would be able to have said what he did if he didn't have some back channel saying, hey this, what you're doing is fine, just don't do X. Yeah, it's going.
- [32:08]
Scott Melker
To be interesting to see how this shakes out. The reason I think it's important is because Bitcoin and the IMF are going to butt heads a lot more in the future because we're going to see more nation state adoption. So this is going to start to set at least a bit of precedent about what that's going to look like in the future. I'm pretty happy that a guy who gives so few Fs about seemingly anything like Bukele is the one who it's going to be tested on because I really don't think he's going to back off and I really do think they're going to get this loan. Now listen, the next story was going to be turmoil in markets but we'll save that for Monday. Tariffs and turmoil in markets. We could do a macro Monday because everything changed so dramatically. I should have mentioned this is a funny story before we go on to the last couple of stories. I've never done this before NLW and I last night, because he wasn't going to be here today, went ahead in the late afternoon and recorded the Friday five intending to be played this morning and joked I'm sure Trump will mess this up in some way. And right after we were done recording an hour later they signed the SBR and I was like we have to literally throw this in the trash. So we had done a whole section on the macro situation there and not one on the sbr. So you can see why we have made that replacement and didn't run that show and are happy to have you today. So the final stories that we have kind of here of course once again on Capitol Hill, but more movement in the right direction. In case you missed it. Icymi Emmer announces formation of nonpartisan Congressional Crypto Caucus. This actually kind of in line with what we were just discussing about the DEFI rule because it's bipartisan. You've got Richie Torres who obviously is a very forward thinking and pro crypto Democrat, aligning with House Republican Tom Emmer to form this nonpartisan crypto caucus. What's interesting here now NLW actually gets the credit for pointing this out to me yesterday. A caucus specifically means a voting bloc. This isn't just a committee or a group getting together. But this is, as they gather, will be people who vote together on this issue and will be bipartisan. So the more people they gather, the more guaranteed votes there will be for pro crypto regulation or legislation in the.
- [34:17]
Dave Weisberger
Future, which arguably the most important part of that is rather than having, you know, the crypto for Kamala kind of nonsense that we saw in the last election, and having Stan with crypto not knowing, you know, who they should support and the ratings of whether you're pro or con, you know, being kind of, let's just say, fuzzy, this makes it diamond sharp. You'll know if someone's in the, in that caucus, then Stan with crypto could be behind them. And if they are not, well, then look, look to who's running against them to see how they rate because it makes it much clearer. That sort of clarity is the kind of thing that, that sharpens the knives out on Capitol Hill and it makes it much, much more powerful. So it's actually a fairly large story if, but it won't matter until, you know, a couple of years from now when we get, as we start going toward the midterms.
- [35:11]
Scott Melker
I think it's just another data point in the future bipartisanship of crypto. I think that this asset slowly becomes less political over time, more a part of the mainstream conversation. And I'm just astounded at how much is still happening here in the first 60, 70 days of this administration, not just in the White House, but obviously at the regulators and now in the houses of Congress and the Senate. We have an honorable mention story here at the end because holy crap, man, if yesterday wasn't nuts enough, I just randomly log into X trying to figure out what's going on. And there's Tucker Carlson interviewing SBF from jail unannounced. To my knowledge, nobody knew this was going to happen. Just thrown out there into the Twitterverse. The X verse. We had SBF in a side room at the Brooklyn prison being interviewed by Tucker Carlson. The funny part of the story is that immediately his two year crisis manager quit because apparently he didn't know that the interview was going to happen. SBF clearly on a roadshow right now, praising Donald Trump, trying to get his pardon right. I mean, that's what this is about. I mean, the highlights of this thing. I listened to it on 2x and almost wanted to throw up, to be quite honest. So I had a hard time really getting through it. Doesn't think he's a criminal at all. I'm not a criminal. I Basically didn't do anything wrong. So still after two years sitting in jail, says the DOJ thinks I'm a criminal. I don't. He's apparently participating in the muffin trading economy instead of crypto, the little wrapped ones that you would get at the gas station. That was another highlight. And he's kind of friendly with P. Diddy, who he thinks has been really nice to him.
- [36:52]
Dave Weisberger
The most important part of this, and I mentioned that I've been binge watching Dexter, is compare Sam to what we now understand are, you know, sociopaths who show no emotion, remorse, and have their own internal, you know, compass. Now, Dexter is the hero of the show, has an internal compass. He only doesn't kill. He only kills bad people. He doesn't do anything with children, etc. Sam's learned nothing. Please understand, when I use the word irony, what I really want to say is how the hell can anyone with any analytical sense whatsoever listen to this dude anymore? We should just stick him in. In there. No one should even be listening. It's crazy. And if the administration pardons and then everything I said about adults in the room is gone. Let's be simple, Sam. Let Alameda make money on the back of liquidating people. That's what they did. I had multiple hedge funds at coin routes. Tell me some that are no longer with us because of Sam. Tell me. They traded on sbf. They traded on ftx, even though they knew it wasn't a fair market. They knew that Alameda had a backdoor. They knew that Alameda knew what they were doing. But because of the profitability and the way it was set up to give them efficient use of capital, they still made money. And they just paid the tax to Alameda and just held their nose when they did it. That's what was going on at the same time. Alameda, we learned later, were deranged gamblers betting on black on a roulette wheel that they thought that they kind of knew so that there was no green spaces. So maybe they were betting with a slight edge. Who knows? And they lost. And they lost repeatedly. And at the end got liquidated because they lost too many times and didn't have enough client money left to steal in order to cover their gambling losses.
- [38:46]
Scott Melker
Sucks.
- [38:46]
Dave Weisberger
I know now you have somebody who literally made the game and profited from taking advantage of the poor sods who got liquidated saying, I know I got liquidated, but if I hadn't gotten liquidated, look how much money I would have. Tell me, Scott, how many people do you know, in crypto, have said to you, if only I hadn't been liquidated and been able to hold on to my position for longer, I would have, I would be worth billions. I'd be a billionaire.
- [39:12]
Scott Melker
I don't, I don't often feel bad about things. I'm very good at forgiving myself. I, I don't dwell on things in the past. I was literally laying in bed last night pissed off about how many bitcoin I lost on Voyager and what I would have had right now. It never goes away.
- [39:27]
Dave Weisberger
But here's the difference. In the Voyager case, somebody screwed you.
- [39:31]
Scott Melker
Yeah, well, of course, I'm talking about.
- [39:33]
Dave Weisberger
The people who use 30x leverage.
- [39:35]
Scott Melker
Oh, and then say, yeah, I mean, all these people get, they're getting liquidated on every single one of these moves back and forth. Billions and billions of dollars. And most of these people want to be long bitcoin, long term.
- [39:47]
Dave Weisberger
Alameda, as it turns out, was trading on leverage that they just, you know, they were allowed to go past their leverage. That was the biggest problem. The, the biggest backdoor they had was they were allowed to go past their leverage without getting liquidated. And so when they finally got liquidated because the market wised up, that, that's the same thing as the person who said, you know, when Bitcoin was $1,000, I had, you know, I had $100,000 worth of Bitcoin. You know, on my, you know, in my position, of course I got liquidated when it dropped, but it, look, if I had been able to hold on, look how, how rich I would be now. I mean, there are people who say that, and, and that's what he's saying. To pardon somebody who is making such inane claims, who profited on the misery of others, on liquidation and stole their money in order to, to keep his Ponzi going longer. It's insane. I mean, his 93 billion dollar claim, I, I, I, I, I was just angry. I mean, it just makes me mad to hear this stuff. And, you know, I'll give Tucker some credit. At least he didn't fawn all over him. It's not like Michael Lewis with the idiocy in that. So, you know, and you know, look, I, I've, Michael Lewis has written two books that I thought were really inane and sycophantic toward bad people. A lot of people watching this knows who the other, what the other book is, but I'm not going to mention it now. But this, but the Sam book was obviously like that. But this interview basically Showed zero remorse and showed that if you were actually thinking of anything other than keeping him there for the full sentence, you just know the answer is no. I mean, I don't want to say it, but I've seen interviews with Charles Manson where he showed more remorse.
- [41:36]
Scott Melker
I mean, SBF literally owned an unregulated casino. We know that in the casino, the House always wins. This was a casino that would have literally made like the, you know, the original Bugsy blush. Because in a real casino, the House has a sub 51% edge and it's just volume. This casino FTX, they could have a token launch and it would be on their site with no volume and 100x leverage five minutes later, literally liquidating everybody, making free money. And he took all the money right out of the vault in the back of the casino and went back to the blackjack table and lost it all at his own casino. It's insane when you think about what he did, how easy he had it. Some people are just not built for living outside of prison.
- [42:27]
Dave Weisberger
And the one victory lap I want to take is my hot take. And we talked about this on your show, we'd have to go through the archives to find it. I said right now it's impossible to conceive, but at some point in the future, and it won't be that far in the future, we're going to consider that this was the best thing that could have happened to crypto, because instead of Sam Bankman fried with his lobbying, we made our regulations, you know, excluded, defy, excluded the real growth channels that are going to happen in crypto now. He would have been writing the rules as probably a DECA bill, as a personal, you know, multiple DECA billionaire and everyone who had to been bowing at his feet. And that didn't happen. And frankly, we dodged a massive bullet because he was a, because he was a gambler and he allowed, you know, his team to be inveterate gamblers to lose that money. It's probably the luckiest thing that happened to us. Didn't feel it at the time. I know a lot of people whose lives were ruined who would never want to admit that. And honestly, the only reason I'm not wholeheartedly trumpeting that it's better is because so many people's lives were ruined. Right. And, and good people, friends. Right. But still, the industry is far better.
- [43:40]
Scott Melker
Off, you know, at least for him. He's locked in jail with Diddy, who we know uses baby oil. Otherwise, like, enjoy your 25 years, buddy. Yeah, I, I, it's you know, it was hard to watch, but also, you know, silver lining, a reminder of how far we've come in that two years since he went to prison and as you said, how bad it could be. So before we wrap, I want to talk to that. You know, we got the audience here. We got a big audience today, Dave, so this is probably our best, you know, the strategic reserve. But I'm gonna also give some credit to the fact that you're here. We got over 2, 000 people on Twitter alone watching on YouTube, watching live. In total, we got, you know, 70, 80,000 people on X across the accounts watching this. Dave and I have been kicking around the Dave show. You know, Dave, you've been making videos. I've been trying to find a way to get you here. We gotta, you know, we gotta talk to our audience and see what they want from Dave.
- [44:39]
Dave Weisberger
Yeah, I, look, I want Dave on.
- [44:40]
Scott Melker
The channel all the time. Well, I know you guys, you know, some of you agree with his hot takes, some of you don't, but I think we all agree that he's got a strong opinion, is going to share it and is exceptionally good at this. We got to figure out what we're doing with you, man. I didn't mean to put you on the spot here, but.
- [44:55]
Dave Weisberger
No, I'm not on the spot at all. I've been toying with the idea of a daily or at least multiple times per week monologue on one or two current events and then finding guests to actually talk about that particular current event. I'd like it to be mostly crypto related and economics related. Every once in a while people want to drag me into talking about various political topics because I obviously have opinions there. But the, the, the, the best way to describe what I would like to be able to do is I had a conversation yesterday with someone who is a rabid, was a rabid anti Trumper, probably is a lot calmer now, but it's certainly well to my political left. And we had, and his comment at the end of the conversation was, I really enjoyed these conversations with you because we always get the best out of each other and the world doesn't have a lot of that. Right? We just don't. And there's too many people who, you know, if you're an anti Trumper, you mention the word, they freak out, their hair stands up on end and they say, well, you're just a fascist. And that doesn't work. There are just as many people, although we don't hear about them as much Anymore who are like, well you know, I can't believe you have this, this viewpoint on trans people. I mean I went public saying that people who have transitioned should be able to live their lives in dignity. And I got all sorts of crap from, you know, fellow Republicans who, who you know, say well, why should they? And you know, I am very supportive of a lot of other, you know, cause celebs I, I think that human beings have complex political takes and, and the world treats it like it's, it's one line from right to left. In reality it's a three dimensional globe.
- [46:36]
Scott Melker
I, I say this all the time. Sorry to go on a tangent guys, but you're here. If you can identify binarily and I'm not talking about gender, you know, if you can say I'm all of these things or all of these other things, you are a sheep and not a free thinking human person.
- [46:54]
Dave Weisberger
Right.
- [46:55]
Scott Melker
Nobody can be a part of one political party and be a thinking individual and agree with every single thing from that political party.
- [47:02]
Dave Weisberger
That's right.
- [47:03]
Scott Melker
It makes no sense. You have to have some departure somewhere where you don't agree with everything because you actually thought about it.
- [47:10]
Dave Weisberger
So I am up for, you know, I am up for a bunch of different things. I'm not going to commit to a daily show because that's just too much. I understand how much time and effort you put into it, but I absolutely could commit to two a week and you know, I'd like to do it on the network and we'd like to figure out the right way to do it. We'd like to figure out if, you know, look, there's economics involved, do we want sponsors, how do we want to do all, all this sort of stuff. I'm very, very open and if Mario and his team is listening, happy to work with you guys as well. So you know, I'll put you on the spot that I, I know, I know, I, I, I understand. But look, there's, there's a lot that can be said and the world needs voices that are calm. The one, probably the most important qualification I have for this is I'm no longer wearing a particular uniform. Right. You know, I just retired from, you know, coin routes. You know, obviously I, I care about the company, I and the people there and what they're doing and feel highly about it. But honestly I'm my own person and they're not me. And we're distinct and different at the same time. I spent my whole career until eight years ago in TradFi and I spent the last eight years in crypto and I, I see the best and the worst of both. And there's this, there, there's so many misconceptions out there. I mean there are, there are people watching this who believe, who probably believe in their core that citadel being paid, you know, payment for order flow in their orders means the retail markets are fixed. The retail markets and equities are so much better for retail than the retail markets in crypto. It's not even funny.
- [48:44]
Scott Melker
Oh, it's not even close.
- [48:45]
Dave Weisberger
And, and, and yet people don't understand that difference. So actually digging into topics that matter is a good idea. But look, today it's about the new direction for bitcoin globally and having the United States government recognizing it as a store of value, which is a massive first. And I look at these little infinitesimal green candles and I think that it's just funny. I mean, Mike, Al, you have Mike on, right? Mike Alfred it all the time. He likes to, he likes to make fun of the kid analysts. You know, you have to understand what's going on underneath that. And, and that would be a great, I would love to have him on and, and actually debate that, you know, all in because I think he's right in the indirectionally but he's wrong in what he says and there's just all sorts of stuff that could be, that could be gotten at too. So I'm, I'm totally up for it.
- [49:40]
Scott Melker
I'm leaving you. We're going to figure it out. I wanted to put myself on camera on the spot so it'll now people will bother me about it. But this is the show we're looking for here. Peter Schiff would have to be a month.
- [49:50]
Dave Weisberger
Oh, I, I, I have, I have offered to debate Peter more times than I count and he doesn't even acknowledge my existence. And the reason for the viewers to understand why is because I am just as experienced in financial markets as him. Admittedly, I didn't have a bank that failed and you could argue that that was because that wasn't fair. And actually I think he's on the right side. But his, the fact that he is a media star despite actually doing some of the things that he's done actually just chafes me because he won't debate with anybody who's really good at it or if he does, he'll do it only with a crypto audience because God forbid he allow his audience to see people who actually understand traditional finance because you've interviewed him and you know that he has a blind spot. And his blind spot is incredibly obvious.
- [50:36]
Scott Melker
Can't even get him to talk about anything except for hating crypto. I started my last. We have to finish here. But I started my last interview with him saying, I don't want to talk about bitcoin. I want to talk about all the places that we agree. And he just went on a rant about bitcoin.
- [50:48]
Dave Weisberger
Yep. Normal.
- [50:51]
Scott Melker
Come on, Peter. You know. And I've had drinks with the guy. He's a great guy. Just has a blind spot for. For bitcoin. Not his thing. Okay, so we're going to do some more Dave, guys. That was the Friday 5. Really enjoyed having Dave on. I wish we could also publish the NLW one, you know, but it was totally out of date within an hour. Just crazy how that happens in this market. You can't. You can't record things ahead of time. I've learned that less than a million times. But, yes, every show here you see is live. Dave. Thank you so much, man. Everybody give Dave, obviously, a follow and I'll see you on Monday for macro Monday, right?
- [51:21]
Dave Weisberger
Yeah. God knows what's going to happen over the weekend. We got.
- [51:24]
Scott Melker
Have a good weekend. Get your rest.
- [51:27]
Dave Weisberger
Take care.
- [51:28]
Scott Melker
Thank you, everybody. See you on Monday. Bye.
- [51:31]
Dave Weisberger
Let's do.