A (2:54)

It follows the market in the same exact way that Ethereum has in the past on bitcoin moves. Sure.

C (2:59)

The difference is I don't think there's existential risks to silver and its valuation. I do think there is existentiality from.

A (3:06)

A price action perspective. It's a good lens to view it with.

C (3:10)

Absolutely. And there's no doubt speculators are looking at that way. And just look at the volatility. I mean, Mike, you're up here. What's Silver's most recent 30 day realized volatility? I'll bet you it's a number that if you had hair, you'd lose it by looking at it.

D (3:29)

Well, it's, it's known as the devil's.

E (3:31)

Metal for a reason.

D (3:32)

And you're right, I've had, I've lost some hair trading this silver. But it's also, it's in you.

E (3:39)

I mean it's 38, that's near the high of April.

D (3:42)

It's pretty high for silver. The average is like 20 and change.

E (3:48)

But it's also what it always does. It's called the devil's metal for a reason. It trades two times the volatility of gold. The biggest problem with it for the last few years is virtually all the precious metals we. When gold's up 10%, silver's supposed to be up 20%. But it's been lagging for years. And finally it catches up. It runs through highs, gets everybody excited. Classic signs of a peak and you just nailed it. It's the pile on trade. You're not supposed to be buying, you know, you're supposed to be selling when they're yelling. Same thing with gold. I mean, I just can't get bullish these metals anymore. It was nice to be bullish before, but you gotta get bullish when people hate them and you have to be down in the mat for a while. And that was what happened with the gold. I mean I expected to go to 3,000 starting in 20, 20, 21, 22, 23. You got to look like an idiot for a while. Finally breaks out, you get a great run. You don't want to overweight it here. And I had that similar feeling with, with bitcoin getting a Hundred thousand.

D (4:38)

Now what?

E (4:39)

Maybe you can help guide me with all these markets. I just, you know, if you make a lot of good money in these kind of things and people pile on and you hear the masses saying about all the inflows, that's when you're supposed to back off and say thank you very much.

C (4:52)

Well, the only difference in you and I is, is I think that you have to look at the denominator too. Right. You know, so I don't, I don't use a static 100,000, I don't use a static 3,000. When the money supply has doubled in the last five years, I double my number. I mean, I hate to say it that way. And if it's going to go up 8 to 10% a year, then I'm going to ratchet that number up 8 to 10%. Which is why I'm more bullish on gold and bitcoin than you. For that reason, I look at the two day flush as literally exactly that. I kept telling people that, you know, I don't think it's over now. Today's bounce, is it a dead cat bounce? I mean if it is a, a classic dead cat bounce would be. Actually we're pretty damn close to it. You know, maybe another 50 bucks on gold and it'll retrace 50% of the loss or give or take, you know, you know, maybe a little bit more. I'm not looking at the chart in real time. I have to do the math in my head and remember where it was. But the truth is that it's in an uptrend until otherwise, so otherwise known. And as long as speculators are in control and sellers are the people who are lining up outside cash for gold stores trying to sell quickly, sell all their scrap, which is happening by the way. The question is, which is a larger force? Because gold's elasticity to price in the long run is from miners who will invest more. But in the short run, it's the same as from bitcoin. It's people who have their wife's gold necklace that she hasn't worn in three years. Oh man, look at this price. We should sell that and we can go take a really nice vacation, honey. And if you think that's not happening, then, well, I mean, you're crazy because it is. I mean there are sites that used to take buy silver that you have to sell below spot below melt value now.

F (6:32)

Right.

C (6:32)

And that just tells you that where physical silver is in economies like the United States and there are places in the rest of the world where you can't buy physical silver without paying a multiple percentage premium. So you see all this stuff going on. It's a very unsettled, volatile, uncertain market. And that feels like a risk asset to me. Now, it's not a risk asset in the traditional sense. It's a risk of currency depreciation.

A (6:54)

But it's still to tie it to crypto before we go into precious metals downhall.

G (6:59)

No, no, no.

C (6:59)

I, I, well, but that, but literally, people who are waiting for alt season on the back of a bitcoin rally, that it went from bitcoin rally to precious metal season, not alt season, because that's where the money flows went. And so if you're wondering what the hell happened, that's what the hell happened. You, you could argue that it shouldn't.

F (7:15)

Great.

A (7:16)

You know, yeah, people were lined up. I mean, is there a better top signal, at least temporarily, when retail starts literally lining up outside to buy your asset?

C (7:25)

Yeah, well, that's true. And the conferences that were happening in Dubai last week were the most popular booths. There was both crypto and precious metals, and the precious metals ones had more retail interest. Look, these things are all cyclical, and Mike and I talk about this and you talk about this all the time. You just have to know it. That does not mean that we all know what I think with the caveat that I think that some alts are valueless and some will have a lot of value. It does not mean there's never going to be another alt season. It does not mean, mean that people are not going to go risk on in the crypto world again. It means that this has to play out before that happens. And as far as bitcoin is concerned, bitcoin, it's really a question of churning through supply. The bid is still here, which is why every time all the doomsayers say it's going to drop, it hasn't. And every time it starts to rally.

F (8:15)

You fade the rally.

C (8:16)

It's. Well, why? It's because people are selling. And the question of the elasticity of bitcoin to its price needs to be worked through. And I'll be blunt, I have no fricking clue when that will happen. My best guess is, as we approach year end, people who wanted to sell to raise money for whatever reason, lifestyle, whatever, will have done so. And so it could be very interesting toward the end of the year and the beginning of next year, but we'll see if the bid stays the same and there's no geopolitical issues. So that's sort of my thought process. But looking at this, it's not terribly different. I just find the funniest story of the day was Tucker Carlson. I mean, he has on so many issues, he has lost the plot entirely. I mean, I almost wonder. It's like, I know these people tend to play. I had a conversation once with Ann Coulter at an event and she basically said, well, you realize there's a difference between what I think and the character I play on tv. Now, of course, she's not playing a character in the traditional sense, but she plays a character. Those are her words, not mine, by the way.

A (9:16)

Yeah, but for Tucker Carlson, there's zero upside being politically aligned, I would say, with bitcoiners to make those comments. That doesn't seem like a I'm playing it on tv. It just seems like. Seems like he's an idiot going off the rails, like, question. I mean, for those who don't know, by the way, he said that he wouldn't buy bitcoin because even though he has no evidence of it, since he's from Washington, the CIA probably created it. And he wouldn't buy it because it's from an anonymous creator who holds billions of of the coin. For those who missed it, it was some sort of speech and it's just so utterly nonsense. He literally said, well, I'm from Washington, so my assumption is it's the CIA, but I have no evidence. So he was kind of making a joke. But he definitely said he would never buy it because Satoshi is anonymous and holds so much of the supply. It's just so dumb.

C (10:09)

It's dumb for two reasons. And I'm going to save. The second one was my favorite one for last. The first one is bitcoin's open source and so you could verify it, which basically means it's as verifiable in its supply, in fact, more so than gold. And no one cares who invented gold. Obviously, depending on what religion you are, you believe that your God invented gold. If you're a scientist, you come up with other sort of whatever. You know, people have their own question. Nobody gives a crap who created it. All you care about is how much of it there is and can I verify it. That's it. Same thing as with bitcoin. So his reasoning is completely insane. The second part though is actually funny. If you were right, it's massively bullish for bitcoin.

F (10:48)

Massively.

C (10:49)

Because if in fact the nsa, CIA, whatever created it, then effectively we already have a bitcoin strategic reserve. In the United States.

F (10:57)

And it's just a question of when.

C (10:59)

Do we announce that we have a strategic reserve and it's backing our currency?

A (11:04)

I don't know if I'll tell that bullish, though.

B (11:05)

I mean, do we really want the government holding however many million bitcoin that was Satoshi's?

C (11:11)

Who would you rather holding? Would you rather the government holding 5,6% of an asset more or less in line with what it holds of gold with no intent of selling it, using it to back our currency, or would you rather own a token that a company owns 40% of it and claims it's okay because it's in escrow?

B (11:32)

At no point that I say I wanted the government. I mean, I'd rather have a token that a random company made. However, we've kind of written off those coins as lost, meaning they're out of circulation. To suddenly find out that they are in circulation and of all things, the government holds it. I don't know if I would call that bullish for bitcoin.

C (11:47)

It's an interesting question. I actually think that the overhang risk disappearing is bullish from a pure asset, pure trading point of view. From a cypherpunk point of view, yeah. Hell no. But then again, the cypherpunks don't want to see a bitcoin strategic reserve created and bought or create in the open market. Yet based on the reaction to the bitcoin strategic reserve in the community, with all due respect, I'd say that the bitcoin community is hell yeah to that concept for whatever reason, because they want their bags pumped. And you could argue that it's a terrible idea. And frankly, many have. And I'm kind of bemused on the subject. I'm not sure I love it either.

F (12:25)

But it is what it is, right?

A (12:27)

Yeah. A lot of hands up, Mark. And then Tomer. I see.

C (12:29)

Okay, I only see Tomer.

F (12:31)

So here we go again.

A (12:32)

I figured we always. We can all. The one thing that we know is very consistent in spaces that you and I don't see the same thing when trying to host spaces. Go ahead, Mark.

G (12:42)

Thanks. Two things this week talking about the gold. I guess, you know, Mike and Dave are going back and forth on gold. I guess the dump was equal to what we saw in April of 13 when I actually, I think that that was around the taper tantrum when they reversed it again. And I thought it was even more. I thought gold dumped 10% at that time, not just 5 and 24 hours. But I think we're Set up very differently because I think we're entering a potential big print. Whereas then we were exiting or going into a stasis of a big print and a. I guess 2012 was the, was the curve shift, the operation twist. So I think that we're not done yet on gold. I think gold is a different state than it was in 2013 where it finished its pump. I think it's just starting. That's an opinion. But the part about adoption and where we are in the cycle, whether it's pumping or dumping with bitcoin. Rick Reeder, who's a guy I do respect a lot. I listened to him when he was doing investment grade at Lehman back in the 90s. He had his weekly call. The guy's an animal. He, you know, every two weeks he gets up at 4am and does six hours through the markets. Make sure he's not missing anything. He did say that his fund owns bitcoin. The fixed income fund doesn't own as much as gold. But to have the world's largest fixed income fund say it's now an asset in there that wasn't out there before. People thought it was in multi asset funds. They didn't realize it was in his master fund. I don't know. You know, as far as Signal, I think that's one of the bigger ones out there. I don't know if Mike McGlone or Dave have comments on that.

D (14:38)

Sure, I'm happy to follow up on that first slide. Mark, I really appreciate the views about gold. The big difference from 2013 it was in the aftermath of the big stock market plunge, the Great Recession and stock market recovery. Now we have a complete different situation where we have the highest potential dependency and correlation to the US stock market in history of mankind. Just look at bitcoin this year it's up about the exact same as S&P 500 and it trades two times the volatility. And I think your average risk manager is starting to figure out yes, okay, great. When the masses weren't in it, it was great, it had great performance. Now it's got tons of competition, it trades poorly and it has a high volatility and it's got a lot of dreamers and people are piling on. I look at gold similar. Gold is just when you have gold rally like it this did this year I'm going to be publishing tomorrow. Just pointed out it's so much stretch versus every single measure of standard deviation history. When you have to go back 45 years when inflation PPI was running in 1980, 12.8 4.5% versus 2.9% now something is really wrong and scary. So I'm been completely bullish on gold for way too long and just say nope. It's at certain times you have to just lighten up. Like I mentioned bitcoin when it reached last year, 100,000. To me they're all big trades that are over. And to me the next big trade is normal deflation from inflation. We're seeing that in things like crude oil and bond yields in China, bond yields in iron ore and everything right now is dependent on this stock market volatility. S&P 500 staying around 8 to 9% and 30 and 16 and 90 days which is the lowest in, in like five years. Everything's completely dependent on that. And I think the whole space is just ready for your supposed to sometimes just get out. And, and, and to me the next big trade is Treasuries and that's, that's always looking forward, not back. And I just see like the, to me the crypto trades over and it's showing that in performance. I look at that Bloomberg Galaxy crypto index up 5% on the year when the S and p is up 15%. It's really bad. And I think if we can get towards the end of the year and be fine, we're okay. But just another little blip like we had in October 10th in the stock market was just basically a little burp and the crypto market threw up. Just a little bit of that and you're going to see massive stop hitting. So I just never seen this much dependency. And I was, you know, I was willing to say bitcoin was a great alternative for until last year. And we had, I think to me that was all the signs of the biggest peak in history. And 100,000 is showing it just by its performance. And I think gold was one of the great alternatives this year. And that's, you know, 4,000 of gold is showing it just so expensive. And that's why I tilt over to good old Treasuries. And I just point out if you just take a basket on the terminal we have the price of US treasuries going back almost 50 years. You have to go back to 1983, the last time they were this cheap versus gold. So I say there's certain times to get out of everything and just stick in Treasuries. I think it's now and willing to fall behind. But to me I see the big reset coming. I've been saying that for long. But the key thing about Treasuries, it made me look as bad as I did in gold for many years and then finally gold broke out and now I'm just, it's just look at the performance. Everything, it's all lagging, it's just. And we all look at that s P5 and everybody looks at me. Oh great, it's up, it's, it's stable today. But even look at that 10 year note yields dropping below 4%. Most people said it was going to be up 5% by now. So to me these are looking forward at indications and be very careful when you know market, bull markets always end in you know, pile on euphoria. We saw that in cryptos, we're selling that and we saw that in gold I think just recently and now it's just about stock market has to hold everything up. So I say just get out. Let, let the, let the final people pile on at the wrong time and wrong place and just you know, Hopium's never a good strategy.

C (18:19)

I wish Joe Carlos are on this show so, so he could go at, you know, go right back at you.

F (18:25)

But all I'll say because we talk.

C (18:26)

About this every Monday and anyone who wants to hear this conversation tun macro Monday on Monday and you'll hear it again. The short story is I think that when you print 8 to 10% of all fiat currencies every single year and you go back a decade, your numbers are going to be off by over 100%. And so I think that the nominal numbers are ridiculous to look at in terms of vis a vis GDP though there is something that has been pointed out, Mike and I have talked about this, which is when you look at the stock market, yes it's at all time highs but so are corporate profits sadly. Also the wages are plumbing all time lows meaning that we have a very two tiered economy and there's all sorts of reasons and that creates all sorts of things going on. And crypto in many people, at least in the community is semi an opt out. The second thing I'll say really quick is if you were right Mike, then the liquidation event that happened last week would have pushed bitcoin way the hell lower. And the reason it didn't is there's a real bid and that real bid mattered and that's why the market, you know, look, some altcoins got absolutely tattooed exactly as you would have expected them to. And several of, and a lot of the memes in fact have not recovered and that's a good thing in my opinion. But that's different story.

A (19:43)

But bitcoin, there's a class action suit against the Melania and Libra guy, which was one of the news stories today, by the way. Speaking of things that haven't recovered, I think Melania's down like 99 points.

C (19:55)

What's the value of any of these things? I mean it's like it, when you're buying memes, there's two options. If the, if the meme itself is part of a marketing campaign, then you're basically buying shares in a celebrity, you know, because it's a brand.

F (20:09)

Right.

C (20:09)

So if, if Pudgy Penguins is a brand that's going to be used for marketing goods and whatnot. Okay, I can kind of get it. And you know, you can see how that would go. Maybe the same with Pepe and others. If your meme coin literally has no marketing value, is not being monetizable or.

F (20:22)

Whatever.

C (20:25)

It'S worse than Beanie Babies because at least with Beanie Babies you could look at it and play with it. And so you see these things and it's caveat emptor. We've seen this over time, many, many, many times now. There are people like Peter Schiff who think that bitcoin is a meme. And I think that in a weird kind of linguistic.

A (20:49)

I lost Dave. Did you?

H (20:50)

I lost them too.

G (20:52)

Lost him too.

A (20:53)

Yeah.

G (20:53)

You know, I think, I think bitcoin is a, it is a meme.

B (21:00)

Because.

A (21:00)

It'S just shared belief.

G (21:01)

Yeah. And the U.S. treasury, I mean my father in law who was a big bond salesman back, back in the day has the, you know, buy U.S. bonds. Uncle Sam needs you back from the 40s. I mean it, you know, that memetic done that, you know, dynamic is absolutely there. Going back to Mike. I know Tomer, I won't intervene too much. I just want to go back to Mike. What you were saying about 83. I agree. I think Treasuries are going to have a bid. I think, you know, they've been flat to down on a total return basis. The TLT and the, and the seven to ten year ETF over the past ten years. They've actually, if you put money into TLT ten years ago, you have less nominal money today. Same thing with the IEF, the 10, 7, 10 year ETF which is coupon in principle. And that will change. I think we are going to go lower in rates and you will make money on Treasuries for sure. But 1983 is a tough Analogy analog, because that was when rates were going from, you know, 15 down to down to zero with a huge tailwind. We don't have that, that scale of movement. And as Dave said, our debt is increasing since the OBB, since July 3rd when the debt ceiling raised. Our debt's up on a 15% annualized rate. It may slow down, but to say we're 2.9% CPI is a misnomer. Assets are increasing and prices 7 to 10%, not, not 2.9. And that's why Bitcoin is in Rick Reader's fund. And, and so that's all I want to. Thanks.

A (22:40)

Yeah, I want to pivot from here, not just continue being a macro show. We gotta obviously talk about crypto. Tomer, I know that you had a comment and once you have a comment, I want to talk about some stablecoin news. Go ahead.

H (22:52)

Okay, well, maybe the comments relates to something so far back in the conversation. I'm not going to reiterate that, but I just think this example of bitcoin being a meme, I think bitcoin has a lot of different stories behind it. And at the end of the day it's got fundamentals that don't change. And when you get to that part of it, the memes are attempts to tell that story in a more accessible way with less effort and less time. But ultimately bitcoin's story is about scarcity and unseizability and permissionlessness. And when you get to the core of that, you can see how in a world where alternative assets, assets are limited in their scarcity or have wild abundance, don't have the permissionless nature of it and can be seized. You, you start to realize that Bitcoin's really here for the long term and here to stay. And you realize how different it is from a Melania coin, that these are really not all in the same class of, of objects.

A (23:56)

When you look at the early days of anything, it's the shared belief that drives it and compounds to the point where people can actually understand the fundamentals. But I think nobody's saying that Bitcoin is a meme coin per se. I think it's just a grander idea, obviously. Yeah. Into relevance, everything. Right. The US dollar is a meme. It's created out of thin air and it's a shared belief in its value.

H (24:21)

Yeah, that. But I even find, I, I even find we equivocate on the term meme for that very reason. Like a meme can be a meaningless idea that sp briefly, but it can also be a condensation of a really powerful idea that needs to be communicated, you know, concisely. And, and I. And that is where. That's where like the bitcoin memes are usually about something that's here to last. Like one bitcoin is one bitcoin or not your keys, not your coins. These are really important, meaningful things that expand into something bigger. Whereas, you know, this dog has a hat is maybe a meme that people will forget about before too long.

D (25:01)

Can I just jump in quick how I think the fundamentals have changed for bitcoin from. I have to admit I was late in the game, but I was able to catch more than a 10x in it. And partly what I enjoyed about it was the government hated it, particularly Trump administration 1.0 did not get what's happening with stable coins and crypto dollars. And it was kind of widely unknown and it had the final diminish.

G (25:27)

The.

D (25:27)

Final diminishing supply, increasing demand and supply. Now it's completely shifted now. Buyers of bitcoin and cryptos have. Are completely dependent, are somewhat dependent on the Trump administration, are supporting the Trump administration because that was what we saw in this last little flush. We saw the tide go out a little bit. We saw Trump, not just Trump, but the family is very heavily invested in this space. So it's shifted also. What shifted is the major thing that I was looking forward to. When we started launching Bloomberg Galaxy crypto index in 2018, it was just, you know, widely decimated ETFs. We got that they're in the space, main mainstream is in it. People who are launching these ETFs are money managers and people who are really exposed to equity market. And what are they taking money from? Where they comparing it to? Well, their equity exposure. I've had money managers tell me, yeah, I love bitcoin, but it cost me. You know, it's. I get double the risk and I'm getting better returns and a lot more of my technology stocks. And I've heard, you know, people who run billions of dollars say that to me. And now what's changed is those volatility has declined. It's in the space, it's in the mainstream. And of course it has millions of competitors and everybody loves it. And I just look, performance, it basically sucks for a year now since it reached 100,000 which was my initial target.

H (26:33)

It Mike, you keep equivocating on the difference between bitcoin and crypto and bit like when you view it as having millions of competitors, you're actually, you're, you're straying from what its fundamentals are. Zero competitors.

D (26:47)

Well, okay, let's. I get it. Let's just point out facts. There was one in 2009, now there's millions. Now the cryptocurrency.

H (26:56)

There's still only one bitcoin.

D (26:57)

I love when people say that, but just look at the performance. Just look what happens when they hit things like dogecoin or any of the others coins. Bitcoin's just all in the same space. I'm just pointing out facts. Remember, I'm an outsider pointing in what's happening. And this is what people. Your rational risk manager looking to allocate sees what's happening and sees the performance. And certainly on the last year basis, it's basically sucked. Is it going to change? Like, sure, it might outperform the stock market if the stock market keeps going up. But to me, it's the next big decent bear market. We're going to get some point in equity market. We're going to see the test. We'll get a nice little flush in all risk assets. Cryptos are riskiest and there'll be a great chance to buy. Right now that looked like it was good for a little while it ran and it looked like gold for a great while that's ran. And now I'm sticking with treasuries. I just, you know, Mike, this is.

H (27:46)

A story, this is a tale as old as bitcoin. You know that people look at the crypto market as something similar. They say, look at these better returns or similar returns these altcoins have. And then an event happens where bitcoin runs way ahead or these things fall way behind. And that's the cycle that keeps repeating. And like, you know, we could have a whole separate discussion. I know Scott wants to move on to some something else, but that you're viewing all of these things as the same speaks to your inability to distinguish between what makes bitcoin unique from these other things. And so when you class put them all in a class together, I would agree with your assessment. I think crypto is way too risky for the potential returns that it might still have and the likely negative returns it offers. But that's a completely different thing than this one of a kind of Mike.

A (28:38)

Me, Dave, James Lavish, we've been having this debate. I would say now we're years deep in it. So welcome to the party. A. I will reiterate to what Tomer said. In my view, there's bitcoin and there's everything Else, that just doesn't mean there's anything wrong with everything else. But they are not the same asset class. And the $19 billion liquidation event that happened just a week and a half ago, and bitcoin's still sitting at 110, and some altcoins literally went to zero should prove that. So it just did not trade like the rest of the market. It was 19 billion in liquidations. Most of that happened outside of the bitcoin market. And to Dave's point, there was a massive, sustained bid on bitcoin, which bounced nicely. The thing that I wanted to pivot to before was I found this to be just absolutely an astounding statistic that I wanted to bring up. I don't know who saw a 16z's crypto report that they just put out. I believe it was yesterday or today. But crypto stablecoin transaction volume in the past year was $46 trillion. Now, that puts it at three times the Visa network for stablecoin transaction volume, and over half now already of ach, which is effectively the network that powers the entire banking system. So we can debate whether it's bitcoin versus cryptos all day long. There's no question that stablecoins are eating the world right now. Or crypto dollars, as Mike would say. $46 trillion in stablecoin transaction volume. I mean, yeah, it's.

H (30:22)

It's amazing how these things happen somewhat invisibly, you know, like, you know, they just. They creep up and up and up and up, and maybe they. Maybe because people aren't using them, or maybe they don't realize they're using them. I saw the same thing happen with the Internet where people thought, oh, well, the stock market blew up in 2001, so the Internet went away. But in the meantime, everyone was signing up for the Internet and checking their, you know, and checking everything on the Internet. And then one day you turn around and look behind and everything's been subsumed by the Internet. I do think that there's something about, you know, with stablecoins, it may be that it's all happening, or a lot of it's happening outside of the United States that we fail to see it. But here it is. It's, you know, it's also. It's got the momentum of a freight train and it's accelerating and adding cars to the. This train.

A (31:10)

And imagine these numbers when exactly what you described becomes the norm, because we literally had Fed Chairman Waller say that crypto and effectively stable coins have be. Are woven into the fabric of the traditional banking system. Talking about utilizing crypto Rails and stablecoins, it's the Fed, right? So listen, we know that this is a faster, cheaper technology. Whether that makes it investable or your coin pumps, I have no idea. But this is superior banking Rails or superior Rails for payments and transactions. So Tomer, what happens when the real adoption happens, which is when you go on PayPal or Venmo or Square or whatever platform or your bank and you just send someone money and it's happening on crypto Rails and that's completely abstracted away and you don't know about it. Right. And it doesn't matter which chain it's happening on. It doesn't matter if it's usdt, usdc, JP Morgan Coin or Schwab Coin, it's going to be hundreds of trillions.

B (32:13)

Well, one thing to point out, that popular stablecoin that was massively used was tether on the bitcoin network and it is none of the transaction volume of any stable coins at this point in time. So while there could be some abstraction using like a PayPal app and whatnot or Venmo, they're still running on some Rails of a blockchain. And when we talk about altcoins and their value, realize that this is one of them. These altcoins, specifically the EVM Rails that actually have tokens that are native to the platform are the ones that are being massively used for all these stablecoin transactions. And not to knock Bitcoin, I hold mostly bitcoin of any crypto, but it's not participating in this network at all. It's failed in that sense.

A (32:56)

You don't hold Bitcoin because of the technology?

B (33:00)

No, not at all the technology.

A (33:02)

But that goes to the same argument, like there's bitcoin and everything else. I hold Bitcoin for a very different reason than because it's a utility token, as you're saying.

B (33:10)

Absolutely. The funny thing is the technology of bitcoin exists in other coins as well. And so really what's holding Bitcoin up is the meme of it's the first coin. It has the story of Satoshi creating it. It's what has the most recognizable brand.

G (33:23)

Right.

B (33:23)

In a way, it is a brand.

H (33:24)

It's interesting you bring this up because.

B (33:26)

I think it has no technology advantage from any other coin. But that's okay, right? Because brand does matter, right?

H (33:32)

No, there's more to it than that though. And so there's more to it than that. There's a big fight going on in Bitcoin right now.

B (33:38)

Technology has at any. That some other chains don't have.

H (33:40)

There's a big fight going on in Bitcoin right now where bitcoiners are trying very hard to ensure that that functionality does not come to Bitcoin because it's not seen as part of the value proposition of, of Bitcoin or, Or beneficial. Or beneficial. The fact that that stablecoins trade on some, on some token and can be moved from one token to another should it get expensive, doesn't actually help that token and it doesn't increase the security of that token and it doesn't create value in the token itself. Right.

B (34:10)

Like you need the gas of that token in order to send a stable coin.

H (34:13)

I'm just saying there's a lot of providers of other forms of gas and the gas, you know, and the moves keep shifting back and forth. So I think, I think when you analyze the compet, like when there's perfect competition, which there pretty much is in all these altcoins because they all run, they even run the same code base, the same virtual machine that, you know, that there's no real opportunity for them to scale up in terms of delivering fundamental value in their token. The value is in the US dollar stablecoin token, which can, as Scott was just envisioning, can migrate easily from one chain to the next.

F (34:49)

Next.

H (34:50)

So if it becomes expensive to move.

A (34:52)

Yeah, I wasn't claiming that it's not valuable to those chains. I'm just saying that the real adoption explodes when it's completely abstracted away. It's the same for everything in crypto. Like, if you have to explain to somebody, like our complicated lingo and the tech underlying it, I don't give a shit how my iPhone works. I don't give a shit how the Internet works. I don't give a shit how my email works. I just want it to work. And so I don't give a shit how my payments work. I just want it to work. And if that's the faster, cheaper way, then spectacular.

B (35:25)

Yeah. And no question about it, I 100% agree with you. And we try to build stuff that abstracts the technology. However, for it to be fast, cheap and abstracted, there will converge to being a small number, if not one chain that a lot of these ecosystems will transact on, because it does cost and does create a delay to transition, to transition between chains. So tracking which chain is widely adopted or getting adopted by these different payment rails under the hood is a marker of which chain and which gas Token will drive adoption and value because it is a value. It's like saying, hey, there's no value in oil. It's just in the cars and planes and every other machinery that uses it. You have to realize there is actual value in the gas token. But to track which chain people are going to use is a way to find out what the future holds for values of the different chains.

D (36:12)

Chains.

H (36:17)

I beg to differ. I don't think it's the same like gas. And gas is limited in supply. And it's not a. It's not a zero. It doesn't cost zero to create, to mint an infinite amount of real gas. It does with all these other chains. And I think this is why you keep seeing the leapfrogging and switching between one chain and another. When it gets expensive or unreliable. Its limitation, people simply move on. And it's why they moved on from bitcoin.

A (36:46)

I'm not saying you're right or wrong, but that's like if there's truly interoperable systems to go back to the same point, like there will be functionality built where if one chain is too crowded or too expensive, it just pivots to another one that's cheap and fits.

G (37:02)

The.

A (37:02)

Chain should be commoditized. I would like to disagree with that.

B (37:05)

I would disagree with that. The reason why people are able to pivot to another chain that's cheap is right now we're in a world where all these L2s are fully funded by VCs and they are not actually achieving true economies. They're basically volunteer networks that are eating cost because they want their network to become the biggest network in the entire system. But as the VC money starts to run out and we actually have to be profitable on those different chains, then you start to converge into which chains actually have some true scalable technology and are most efficient. Right now we're not there yet in the same sense that we weren't there in early days of Bitcoin. When we transacted on bitcoin, people were losing money trying to mine the coin and mine transactions until it starts to grow and people gravitate towards it. The same thing for all chains. At the early days of a chain, it's a volunteer network and this is what you're trying to compare against and saying, hey, we could just spin up another chain that's cheaper and spin up another chain that's cheaper. That can't happen in perpetuity. That eventually does have to converge and at that point that will decide some of the few winners on the entire crypto network.

A (38:10)

Yeah, and the winner could be USDC coin, right? I mean USDC chain and they could just build their own Rails and JP Morgan chain and such. So it's hard to predict the future.

B (38:20)

But they could, they could, but that wouldn't have the advantages of actual censorship resistance, crossing borders that would be entirely KYC'd, that would entirely prevent being able to transact with at least a half a dozen different countries in the world. And that's what we don't have with the current Rails and with the current stablecoins today. And so sure, they can build that, but we'd lose a lot of the core advantages that we have with the chains that currently transact stablecoins.

H (38:45)

No, but this is exactly why you look at the example of the market leader by orders of magnitude tether and they're not married to one chain and they've abandoned chains and moved from one to another and are in a position where they can continue to move from one to another based off of all requirements, the cost to transact the censorship, potentiality, whatever it is. And so you've already gotten this example of the 500 pound gorilla in the space choosing to not be loyal to any particular chain and issuing their token on multiple chains to abstract away the risks of any single chain, whether they're time, whether they're speed, security, reliability, bitcoin.

B (39:32)

So just so you know, that is actually the chain that they've just kind of migrated.

H (39:36)

I'm not, I'm not trying to make the case that bitcoin benefits from having altcoins on it. I'm, I, I'm thrilled that they have, have moved on and if there's a second layer solution that they can use on bitcoin, you know, these guys are, they're, they're hardcore bitcoiners, the te, the tether guys.

G (39:51)

Right.

H (39:52)

And if, if there was a non impactful, speedy way to use it, then they would. But many, many people in the bitcoin community actually don't want this on because the bitcoin story is a different story. It's about scarcity, store of value, reliability, censorship, resistance, permissionlessness, so on and so on, which has nothing to do with. And you can spin up more tokens more quickly and speculate more on meme coins and other things of that nature. And we don't want that on bitcoin.

B (40:21)

I think the we is an interesting term there when you say we don't want that on Bitcoin. I think it's because most of the people that did want it on bitcoin were basically kicked out and said sorry. And so hence the entire altcoin community that spun off in 2017. And so there are now other use cases. And sure, stablecoins is a big one. As much as I've expressed that I dislike many aspects of them with them being centralized and very surveillance heavy, but it is very transformative in our world and it has actually increased the value of other chains. And bitcoins are simply losing on its opportunity to increase that value. And so bitcoin has its own value. I agree. I'm not going to try to say that the store value narrative is a broken narrative, but in crypto town hall, people want to know what to look at next. And I'm simply saying that tracking what are the chains that different protocols and even tradfi are choosing to use as rails for stablecoins is a metric to say, hey look, let's keep an eye on the gas token on this chain because it will be needed in order to transact on those stable coins. And to say that, hey, we're going to be fully interoperable with 100 different chains transacting stablecoins I think is short sighted because of the effort to transition between chains will continue to be challenging and there's no good, great, there's no great solution in sight to make that seamless. And it becomes far more smooth and seamless if we are transacting on the same chain. At least within, say Venmo, say Venmo, at least chose a chain that they're going to transact their, you know, PayPal stablecoin when you're using their app, that chain is going to achieve substantially more value from its gas token than all the other ones, even if there is some level of interoperability.

A (42:01)

Dave, jump in anytime, of course.

F (42:02)

Yeah. So the problem with that, Paul, is, and I'll call bullshit on it, is the current valuations of most of these tokens are such that a meaningful increase in the valuation would make that gas less economically viable and the company is going to want to retain the most of its revenue. And so you'll end up with something very similar to where tether is. Because, and I've seen this before, you know, when you have something that's effectively being treated like a utility, it's very limited in where its valuation can be precisely because it's based on economics.

C (42:40)

So just consider that it's one of those things. I think that stablecoin will be massively.

F (42:46)

Transformative to chains that can deliver value but not because of the gas use in stablecoins itself. And that's going to be because it will open up the financial system. That's the reason. At least that's my theory.

B (42:58)

Define like open up the financial system that driving value to the gaps.

F (43:01)

Okay, I'll give an example. I'll use Peter Schiff as a perfect example because he's inventing a tokenized gold fund. And the biggest big invention that he has is something that's going to be totally ubiquitous in five years, which is that you can own his to this tokenized thing and you could use a debit card that will automatically sell it and transmit it to whatever FX it needs to be. So you could use it like a MasterCard, that kind of functionality auto sweeping from investments into stable coins for payments and abstracting it all away. So it could be used via debit cards or your phone or Apple Pay or Google Pay or WeChat or whatever the hell you want will be ubiquitous in five years. So the ability to spend in whatever currency you want to spend in, invest in whatever you want to invest in as long as it's tokenized will be ubiquitous. The banking lobby will fight it, but they will lose because it's one of those things that the technology just opens up too much opportunity. So yeah, that will happen. And therefore investments that are tokens that have other investment cases are potentially going to do extremely well because it's going to be open to the entire financial system system. That's my point.

B (44:08)

So just the fact that once you're on a car, on a chain, you're going to be able to get to other tokens and that by itself is going to give the token value?

F (44:15)

No, no, that by itself will allow tokens that actually have value to have a better distribution and of course better penetration.

B (44:23)

Of course, fully agree there. Now the question being is why would the gas token of a network that is widely used to transact stablecoins and do other defi operations, why would that not give the gas token itself value? That's the part that I think.

F (44:37)

My point is if that's the only value of the token, if that's the only value of the chain, it's limiting. And by the way, it's why Tron isn't as valuable as Ethereum, right?

C (44:49)

You could make an argument, but Tron.

F (44:50)

Does more stablecoin transactions or as much as Ethereum does and is what is it, an eighth of value? I haven't checked recently in no way.

B (44:58)

Shape or form by saying that's the only Thing that brings it value. It says value that is is being eschewed by any chains that don't support that kind of use case and it's what? And it is a value that you're bringing to a chain. Heck, we're looking for all the reasons why a coin may have value, right? There's many different reasons and that's what people are listening here to figure out. Okay, what do I follow next? And so this is one of the metrics to look at is hey, which chains are actually going to get used for transacting under the hood by these tradfi companies in order to transact stablecoins. That's a metric. It's not the only one. And I agree with you, right? There's many different reasons why a token might have value with each other.

A (45:28)

Eth.

B (45:28)

Some people actually do hold it and they stake it and they also put it into, into a borrowing platform like AAVE to borrow against it. So yes, there's other reasons for it and they might actually use it to mint a decentralized stablecoin. So there's other uses. This is one of them. And I think this is a valuable one. Heck, it's actually propped up Tron. You're right. Tron has some of the largest stablecoin transaction volume and it's one of the of all of the quote unquote altcoins in top 10, top 20, it's held its value incredibly well and has gone up in value with its use of stablecoins in Latin America. So I think you can't eschew the value of it being used as a gas token because most of Latin America is not holding Tron, not holding Tron to just speculate on Tron. They're holding because they need to pay the gas token as well. They can hold it to stake it and by staking it reduce the cost for them to transact tether. And all of these are mechanisms by which you can bring value to a token outside of it just being a store of value, but actually having some utility, especially in the stablecoin era.

C (46:32)

That's fair.

F (46:32)

I mean, I don't think we, I.

C (46:34)

Think at the end of the day.

F (46:35)

Paul, we're pretty much on the same page. I think my big thesis for the altcoins in general is demonstrate value and demonstrate value to the token specifically, not of the network. And you know, I get into arguments with people on different coins for different reasons. I mean, I mean obviously quite famously with the XRP army, even though as a trade, I still think it's logical, but whatever. It really is a question of growing up and saying, well what happens. I asked the question, I don't know if you were on the other day, I said what happens if they get rid of the accredited investor rule? And the reason that matters is because if they do, then pretty much all the SEC rules that screw over and make it a death sentence for a token to be a security disappear. Poof. And so if it all of a sudden, you know, you can and all you have to do is look at the OTC market to understand what I mean by that. In securities, if all of a sudden every token could be a security and traded pari pursuit with equities and or you know, being listed in the United States with no problem, you know, which would actually separate themselves as massive value. It would in fact be a separation function. It wouldn't be a license for everything to go higher. Although at first that's probably what would happen. And that separation function, that valuation function is what will be the most interesting part. And I do think it's going to happen by the way, one way or another in the next n number of years. So yeah, value is the key here.

G (48:00)

Dave, I wanted to jump in. You were talking to Paul and saying you kind of agreed on token versus network and the token has to have value vis a vis the network. Let's look at the analog that's happening with the G20 banks. I think in the past month gold is now the largest reserve asset outside of or above Treasuries. So it switched. There was a utility store value. The treasury dollar didn't provide it but the dollar is still the largest trade asset that has not diminished in the same rate of change as the reserve currency status of the dollar. So it's been bifurcated its value and I think that's Bitcoin versus the alt universe. Peter Schiff is going to be doing a tokenized asset as you said, where the store will be in gold and then they'll transact. To do that you have to be captured, you have to be KYC'd and part of the system which is what Tomer was saying. That's a give in order to do that, that so we're, we are seeing a very dynamic situation unfold with the dollar and Treasuries in liven in color in the analog traditional world. And it's, it's being mirrored in the crypto digital stablecoin. Stable coins are huge utility for a lot of people, but it's still tied to the dollar which is a step up from say, the peso again, looking at what best instead of doing for Argentina by enacting that swap because there's better value in the dollar. So this is just phenomenally dynamic. It's awesome. And I love what you said about Paul about the VCs providing, you know, temporary value. Almost like what Open Air is doing to, to a lot of its programs. Not sustainable, but being propped up. So I wouldn't say that that's, you know, a sustainability sustainable element. So great conversation, guys. This should be recorded.

A (50:00)

Good news. That it is. Yeah, that's how people listen back. So it's great. We get the most of our listening on the recording. So I concur. Good job everyone. Dave?

F (50:16)

Yeah, I mean, I think that the real, the real key here is, is, is is understanding investment cases. And, and, and I think we all generally agree about that. I mean, that's the difference. When you made the joke about, you know, us old people, I mean, we, we all understand that trends happen and in a trend, you, you know, we, we've seen on the Internet, you know, we saw monetizing eyeballs, but before it was monetizing, it was like, well, there was going to pay for eyeballs. And then all of a sudden that, that fell apart, et cetera. There's all these recurring themes, but as I was explaining to someone yesterday, arguably the most important force in investing is one that no one wants to admit, but it's very, very real, which is narrative. I mean, narratives drive massive changes in investments. And you can go back through history and, you know, I don't know if everyone knows, but I'm writing a book which is called Million Dollar Frat Boys, and we could talk about at some point later. But I was writing the chapter and work, working with the guys who were helping me write it yesterday, about the Japanese bubble. And the Japanese bubble was not driven by monetary policy, was not driven by anything other than this massive narrative back for those old people who remember that the Japanese miracle was going to transform manufacturing. And it was a, it was essentially a full decade on the rally. And then it started falling apart when people started to realize that unfortunately the Japanese companies couldn't adapt to technological change very well. And so they fell behind rather rapidly, which was ironic because they were really good at producing technological goods, but they couldn't change the way they operated. And you see these narratives through investing all the time. History constantly, if not repeats. It certainly rhymes. The narrative about stablecoins is one based on change and it's going to make a Very big deal. But you're going to have to dig a level below to figure out where the value is. Is going to go.

A (52:09)

Hey, Dave, we have some pretty big breaking news. CZ was just pardoned by Trump.

F (52:15)

Really?

A (52:16)

Yep.

F (52:18)

That's interesting. Is that. Is that bullish or.

A (52:23)

Last I checked, he was already out. Last I checked, he was already out of jail. So I don't really get why it.

F (52:27)

Matters, but I mean, I think it matters because.

G (52:31)

Is he going to marry one of his daughters?

F (52:33)

No. What it means is I shouldn't say no. But what it does mean, all kidding aside, is it means he is now he was barred as part of it from working with Binance.

A (52:47)

Yeah, seems like he's been doing that for a while again, anyways.

F (52:53)

Well, whatever. I mean, anyway, it makes it easier if you, I mean, I would imagine BNB token would be leaping on that, you know, if, if you believe that he is the kind of operator that most people believe he is. And so let's see, what's BNB doing.

G (53:08)

That'S up three and a half percent.

F (53:11)

And in fact, yes, he gapped up. What. What was it at? A candle.

A (53:19)

It's pumping at this exact moment, for sure.

F (53:21)

Yeah. Well, now it's gonna. It's kind of in the middle, but it immediately zoomed, you know, had a huge candle up and, and that. That's logical, right? You know, if you believe, you know, it's. When you have great CEOs that have done great things, people tend to ascribe value to it. And that actually makes some sense. I mean, where the actual. Where it settles, who the hell knows? But that's a good thing. I won't speak to the notion, but it's him being his criminal, you know, indictment seemed rather sketchy compared to so many other people who have done some so much worse. But that's besides the point. That's just my opinion. But it is interesting news, Scott. I mean, what do you think. What do you think this means for alts and defi.

A (53:59)

Where.

F (53:59)

Which is obviously where CZ's passion is.

A (54:01)

I think this means that SBF is definitely getting pardoned so that we can get a UFC tage match between CZ and SBF to finally.

F (54:10)

Dear God, I. I so hope you're wrong because there's a. There's no.

A (54:13)

They're not pardoning sbf. But he's got to be salivating right now watching this from whatever, you know, baby oil ridden cell he's in with Diddy.

B (54:27)

I think he donated too much to the Democratic Party. Though for Trump to pardon him maybe.

A (54:32)

But I, I think that it's, I think it's a, I think because CZ has already been participating so loudly over the past weeks and months that maybe it doesn't have a huge impact. But I do think it's definitely yet another signal in a long line of signals that crypto has a massive green light.

F (54:54)

I mean, honestly, I think that the amount of innovation and the pace of innovation is accelerating and I think the market is not pricing that in in many places and there's other places they may very well be pricing it in. But I think at least in terms of bitcoin, I don't think it's priced in. I don't think people truly understand, you know, what's coming. But we'll see.

A (55:14)

The chart I want to check really quick before we go is astronomical because that's the one that's up $1 to 107 and, and on its way up. So yeah, these are the BNB Aster, anything sort of CZ related is, is catching a bid. I think that it's just all systems go for crypto in the United States for now. And that's one more signal of the same. Wow. We hit it right 11:15. Thank you guys for joining and listening. Thank you to the panel for participating. And we will be back. One more crypto town hall this week tomorrow at 10:15am Eastern Standard Time. Thank you, gentlemen. Thank you everybody. We'll see you tomorrow.

D (55:56)

Bye.

G (55:56)

Thanks, Scotty.