← The Wolf Of All Streets
The Wolf Of All Streets
He Put 80% Into Bitcoin, Now He’s Calling Out The Government | John Deaton
00:26:34
Loading summary
Transcript87 lines
- [00:00]
A
I look like one of the McDonald's dudes. That was a good look for me.
- [00:05]
B
There you go.
- [00:05]
A
Finally formal.
- [00:07]
B
If you look at the big beautiful.
- [00:09]
A
Bill, that was one of the worst, best days of my life.
- [00:12]
B
Take your 10 grand out. But I don't follow my advice for some reason.
- [00:16]
A
Nobody does.
- [00:17]
B
I'm human. You're terrible at it. So the boot of the government's on the neck of the industry.
- [00:22]
A
If you're 100% in Bitcoin, which some people say that they are, how do you live? That's dope. So what do you want to talk about?
- [00:44]
B
Well, at the bitcoin conference, are we going to talk about xrp?
- [00:49]
A
So funny. You were downstairs and you said my net worth's 80% in Bitcoin. So don't get mad at me because I'm working on the other 20%. We're still in a world where like 80% isn't enough for the hungry angry lions.
- [01:04]
B
Scott, it's funny, I just looked at on X and I saw someone say to your post where he said something about favorite people on stage and someone was like, why is the XRP guy at a bitcoin conference? And I replied 80% of my net worth. And running against the politician who wanted to ban self custody of bitcoin is not enough for you?
- [01:26]
A
It's weird. I feel like it's shifting though.
- [01:28]
B
It is.
- [01:28]
A
Like four or five years ago they really were out for blood. But I feel like now 80% is sufficient and maybe they'll appreciate the efforts. The funny thing is though, it's strange you would be considered the XRP guy because it was never about the asset.
- [01:44]
B
No, it wasn't. In fact, when I sued the sec, I had way more in bitcoin, obviously. And I even had at that time like four times more in eth. I only had three bitcoin, ETH and xrp. And at that time I was really selling altcoins to buy more bitcoin. Right. It was just about government overreach. You know, the government shouldn't tell you what you can own. They shouldn't pick winners and losers. You know, you don't let something trade for seven and a half years and then say all of a sudden say it's illegal. And then we saw it play out because a lot of people were hoping it was a one off. It was just ripple related or it was XRP related. And then we saw the spot ETF bitcoin get denied, which took an appellate court to say that they were arbitrary and capricious. And so I think generally even bitcoin maxis were like, okay, the government's bad actor sometimes. And it's okay if someone fights them, so it's cool.
- [02:41]
A
Have you found that you actually get support and respect for having beat the sec even though it wasn't on behalf of Bitcoin? Because there's some cognitive dissonance there, right?
- [02:52]
B
Because there is.
- [02:53]
A
There were the bitcoiners who cheered for the SEC because it was Ripple.
- [02:56]
B
Right.
- [02:56]
A
But the same ones would tell you that you should opt out of the government entirely and buy bitcoin. So how does that make any sense?
- [03:05]
B
A lot of times it doesn't, you know, but my whole feeling was that the tribalism is fine as long as it's not the government telling us what we can buy and what we can own and what we can't own. But yeah, there's still some people who view it as, oh, you helped Ripple or you helped xrp. And I go, no. To me, it's fighting the government, fighting the Elizabeth Warrens of the world is the honorable thing to do. But there's always going to be some people like that person, like, why is a shitcoiner on the stand because he helped XRP. But listen, I think 80% in going against her is, is enough to prove that I like this asset.
- [03:45]
A
She's still out there, man. Did you see her in the stablecoin on the floor?
- [03:48]
B
Oh, she's counting votes. She was so invested. She was arguing with Senator Gillibrand and she thought she could stop that stablecoin legislation. And when they backed off initially, she gained more momentum thinking she could stop it. And the reality is the stablecoin really isn't that big of a crypto bill. It really is a US dollar dominance bill. If 99% of all stablecoins are US dollar based, that's probably going to continue. And then if the federal law can say this is what is required to gain access to the greatest financial market in the world is still the United States. You're going to have to have US dollar based. You're going to have to have whatever parameters they set. So. So it really shouldn't be controversial. The fact that we initially thought stablecoin legislation might not happen was scary because that's the easy one. Then you got market structure, Bill. We need some consumer protection. We need bankruptcy protection for centralized exchange accounts. Obviously, I don't think Coinbase is going bankrupt or cracking or anything like that, but if they did, my account, your account should never be considered property or assets of the Centralized exchange to go to their creditors. It should be yours. So making sure that there's Segregation of funds, 100% reserves, and bankruptcy protection is something we desperately need.
- [05:20]
A
I happen to have some personal experience with that, having gone through the Voyager bankruptcy, obviously, and there's still no clarity even there. And I've had a lot of lawyers dealing with this, sadly, on whose assets they are. They've made the claim that the assets aren't mine in the first place. They were lost by the. That were lost by. By Voyager. They were Voyager's assets.
- [05:40]
B
Yeah. And imagine a centralized exchange like that gets very aggressive and makes some really bad decisions for loans. You shouldn't punish it. You know, whether you've got, you know, half a million or five grand in a. In a centralized exchange account, it should never be considered the property or assets of that centralized ent. And that's something that we definitely need passed. And if they're struggling on stablecoin, which is just really reinforcing the dollar's dominance in this new technology, then how difficult is it going to be to get more complex legislation?
- [06:18]
A
Just thinking, if in all of our conversations I've ever asked you how you actually got into Bitcoin in the first place, I think everyone thinks your genesis story is being the XRP lawyer. But you just said you were already 80% in Bitcoin, effectively before any of that even happened. So what got you into it in the first place?
- [06:36]
B
It was 2016. I heard my daughters, Olivia, my oldest Olivia, and Jordan were high school. And I started reading about the bitcoin, read the white paper, literally got emotional because you know my story, welfare and food stamps. My mother could not keep a bank account because this is in 1970s and 80s. So it would be a physical, hard welfare check. She couldn't keep the minimum deposit, so the bank would hit her with the predatory fees. That's how they treat poor people, right? We're going to hit you with more money, fees, money you don't have. So my mother, if you ever go into inner city, you'll see check cashing stores on the corner, say liquor, check cashing lotto, Western Union. So my mother would go there and I remember her debasing herself, man, like, begging, please, can you take 10% instead of 15%? Imagine. So I would watch her beg them. And then when I went to college and I would send her money when I could, I'd send her 100 bucks. They had to go through Western union, they take 12%. So if I'm sending her 100 bucks, she gets 88. And you know, my mother, God bless her, she could stretch $12 with some Pinto beans and potatoes. Potatoes and cornbread. So I thought of mom, I thought of unbanked people. I thought of capitalism being spread across the world. You could be in Nigeria, have a smartphone and a website, and you don't need a bank, you don't need an intermarrian. I thought of migrant workers who could avoid the Western unions and the moneygrams and be able to send money directly. And so I thought of poor people and lifting people out of poverty as an example. And the more I read about it, the more I thought that bitcoin and digital assets represented the new American dream to me, when I was young, you bought a house, maybe you are lucky. You buy a couple stocks you own, maybe a rental property, but people are being priced out of that. You can't afford a house today. Regular people, young people can't move out. Old people are forced to leave certain states. And so I view it more as an opportunity. Think about tokenization. You can't afford a home, but if you live in an apartment building, it gets tokenized. You could be a renter and have a fractional ownership in the building in which you live. So there's all these ways of where I think that we could attack the wealth gap, because I honestly believe that the wealth gap is at a stage now where it's going to trigger civil unrest and all of those things. It's, I believe, the biggest sort of factor or risk that we have in our country today.
- [09:18]
A
It's interesting, though, because you can understand bitcoin and you can say, this is a superior way to send my mom money without buying, you know, putting 80% of your net worth into it. So there's a. There's still a gap there into where you said, hey, I understand this incredible use case. I'm going to use it or I'm going to own some. But you basically went all in.
- [09:40]
B
Yeah, I did. And I did it before Saylor did it. But if you count the year I graduated law school is 1995, a dollar is now worth 50 cents. So the purchasing power of the dollar, you cannot continue to debase your currency. When I was young, they talked about millions. When I got in college, these government programs would cost 4 billion, 10 billion. Now they talk about trillions. If you look at the big beautiful bill, it's going to add 4 to 5 trillion dollars of deficit over the next 10 years. So what are we going to go from 36 trillion? We're going to be at 41 trillion. And these politicians, they only, they can't resist it. The printer is an addiction, man. It's like heroin to people in politics. Leaders, they just can't prevent themselves. They're not going to talk about Social Security, right? So my 6 year old daughter should not have the same Social Security program that her father has. There should be some kind of way that we work on that we have to do something. But these politicians refuse to do it. They just keep kicking it down the can. So I thought that instead of owning dollars, I'm going to own bitcoin. And now five years ago when I did it, I thought it was riskier than it is today. I think today there's a stronger argument to do it than it was back then. Because who would have envisioned the president of the United States establishing a strategic bitcoin reserve? Not one that just says hodl, the bitcoin we have, but acquire bitcoin in a budget neutral way to two bitcoiners, the treasury Secretary, the commerce Secretary. Who would have envisioned that? Who would have envisioned a Senate bill that, you know, maybe it gets the votes, maybe it doesn't. But Loomis bill, that's saying acquire 5% of Bitcoin. When you look at all the institutional FOMO that's going on, it's almost stupid not to at least have some exposure to it as far as I'm, because, you know, I got 80%, you don't have to be me, right? But how do you not look at, if you're a financial advisor, how do you not say to someone, listen, you really need to at least put some of it. If you have 10 grand, how do you not put 1,000 in Bitcoin to invest? If you have 100,000, how do you not put 10,000, you know what I mean?
- [12:11]
A
What you said is really interesting because I've heard it repeated now quite a few times. Matt Hogan, I think from bitwise was one of the first said to me, he said, I think right now is the best risk adjusted time to buy bitcoin. He's like, it's actually relative to its chance of going to zero. This is the best price you could have ever bought when you did it in 2016. Even if it was three grand, 1000, 1500, whatever it was, it was still in that it could go to zero phase. At least people believed it and the government could ban it or any of the what we've seen to be false narratives. But back then you were really rolling the dice.
- [12:43]
B
It was and it was probably too risky for my age, right. Because I'm 57. So you're talking about I'm in my early 50s. If we're going back to that, maybe late 40s, around that 50 age. I probably shouldn't be that aggressive. But when you go from extreme poverty, you almost. You don't worship money. At least I don't to the point it was like, well, you know, I'm a talented guy with my law practice. If I lose it, I'll just have to work harder and make it again. And so. But it was a faith that there were days, don't get me wrong. Now I'm not pretending that In March of 2020, for example, when Bitcoin went to what, 3700 or something like that.
- [13:30]
A
Depending on the exchange.
- [13:31]
B
And was I like this? Yes, was. I have some sleepless nights thinking that shit, I just ruined my kids inheritance or college education. What's wrong with you? So I had those moments. I'm not going to pretend I didn't.
- [13:46]
A
That was one of the worst, best days of my life because I had that exact same feeling. But weeks before that, I had set bids on Bitcoin at $4,000. I never thought would fill.
- [13:57]
B
Wow.
- [13:58]
A
And I literally was like, it's never going there, right? But if it ever does, I want to buy it. But I went to bed and Bitcoin was $6,000. And I woke up and Bitcoin was $6,000. And in. I hadn't checked the price in 12 hours, it went from 6 to 38, back to 6 and I filled and then I was up 50% when I woke up.
- [14:17]
B
Right.
- [14:17]
A
Unlike the biggest bids. But you know what I did? I sold half of it. Being honest, right? I sold half of it because like I just made 50% on my money. I'm taking out half of it and I'll ride the rest of it. That was probably the only time I.
- [14:29]
B
Can recall that I know that's smart.
- [14:30]
A
Made a decision to sell bitcoin because I was in such shock that while I was sleeping I had made 50% of my money.
- [14:36]
B
Well, the re. The reason I'm, you know, we're in the arch public thing. The reason with those guys because I, I preach what you did. I tell them all my listening, you know, you put 10 grand in, take your 10 grand out. But I don't follow my advice for some reason nobody does. You're human, terrible at it. So being able to set that in a way that you participate. So you should, you know, I'm Sitting here saying to myself, okay, you and I were talking about it earlier, what price should I take some Profit? Is it 180? Is it 160? Is it 200?
- [15:10]
A
The Grand Wizards of bitcoin maxism are not going to, they're not going to kindly to you talking about selling, you're not allowed to do that. Well, sarcasm, you can tell it.
- [15:20]
B
Well, you know, I have a six year old, so maybe putting her college money away would be nice, you know what I mean?
- [15:26]
A
So if you're 80% in, you still have to live. There's people that, that's what I like. I don't understand. If you're 100% in Bitcoin, which some people say that they are, how do you live?
- [15:38]
B
No, no, that's true. And I'm not one where I'm going to like loan it out. I'm not a leverage guy. So, you know, although I did leverage like on Schwab with like Apple stock and some of that. I've never really leveraged, traded bitcoin or any other crypto. And so I'm not someone who says, okay, I'm gonna, maybe I should, right? The conventional wisdom would, okay, take a loan out on my bitcoin holdings, I'm 80% in and live off that. But I don't know, I haven't done that yet. Maybe I should, I don't know.
- [16:10]
A
That's the future though. Obviously the previous iteration of it was predatory and all of those blew up. But that is coming to Schwab.
- [16:21]
B
It is, right?
- [16:22]
A
I mean, so everybody, every wealthy person knows you buy, borrow, die, and you never sell anything and you never take a taxable event. Right? But you've never really been able to do that with bitcoin. I can tell you anecdotally, a friend of mine and I didn't know existed moved all of his money to Robinhood. Because one of our close friends is now the number two guy, Robinhood. He sells his company to Robinhood. And he was able, and I've never even heard that this was possible with his crypto sitting on Robinhood, with his stock portfolio, was able to take a 50% LTV loan, including on his Bitcoin at 5% and pay his taxes without selling anything. I had never heard of a place where you could have your stocks and crypto spot, crypto, not ETFs, blended and do exactly what you're talking about, like on Schwab. So that's actually here and nobody's even talking about it.
- [17:07]
B
No, it's not.
- [17:07]
A
We Got Vlad from Robinhood here. I'm gonna ask him about it.
- [17:10]
B
Oh, that's fantastic.
- [17:11]
A
But that already exists, so you can't tell me that's not coming to every financial platform in the world.
- [17:15]
B
Of course. And I'm a Schwab customer. I guarantee it'll be Schwab. Now, there's obviously talking about they're gonna have active trading. The CEO of Schwab said he regrets not getting into bitcoin earlier. And so, you know, I was on stage with Andrew earlier. We were talking about this institutional FOMO that were basically witnessing, not retail fomo, right. But institutional bitcoin fomo. And so, no, I believe it's today much safer than it was when I did that risky move. And people, my daughters would even say, dad, are you that strong? Believe, dad, what's your health like? Right.
- [17:59]
A
I bet they had to check the policy.
- [18:02]
B
Like, that's. But when you're a believer, you're a believer. But it's funny because we start this conversation with the Maxis saying a guy who put 80% of his net worth in 2016 in Bitcoin somehow shouldn't be at the bitcoin conference because he fought the government and it had to do with a token called xrp. To me, that's stupid.
- [18:27]
A
That fundamental tribalism just blows my mind. It's in everything.
- [18:32]
B
Sports it is.
- [18:33]
A
Religion and nationalism and your token, it's all the same thing. But still, it just blows my mind. You literally were fighting the sec.
- [18:42]
B
Yeah, but at the same time, if I can earn money or build wealth for my family, for my children and myself. And why would you be against that? Like, is what I'm saying? Because you so do you not. Like, if I buy Microsoft stock, Like, do you have a problem? Because Bill Gates is Bill Gates. You know what I mean? I was trying to explain that my daughter's graduated USC a couple years ago, my oldest, and she's a lot more liberal than her dad, and she's buying an electric car. And I'm like, well, you should buy a Tesla, honey. She's like, I'm not buying a Tesla. Elon Musk. Right. I'm like, well, what about the 140,000 US workers at Tesla that you're supporting? It's not Elon Musk, but we live in this kind of tribalistic, identity politics, divided world. That's crazy to me.
- [19:34]
A
So I've seen you publicly use Arch Public for xrp. Are you using it for Bitcoin, too?
- [19:38]
B
Yep. Bitcoin. Have Solana Algo on Solana XRPS and Bitcoin.
- [19:47]
A
How do you determine sort of your personal allocation to each as a function of your percentage? Because Obviously if you're 80% in Bitcoin, you know that most heavily in that, like how do you play altcoins mentally into the percentage of your portfolio?
- [20:01]
B
What I did is, and to the guys at Arch Public's credit, Andrew and Tillman, because you know, just like you, you get it, you know, they didn't approach me. A friend, Todd, approached me. He was really, they didn't approach me. He was talking about what he was doing at Arch Public, you know. But whenever you have a little bit of status, you know, people will say, oh, you're shilling, you know this, I saw it, you're shilling that, right? And so I said, listen, I'm fascinated by this because I'm someone who's never going to give up. You know, not talking about exchange, but I'm not going to loan out. I'm not going to do the Celsius blockfi thing. I'm not a huge leverage guy. But I've owned Bitcoin since 2016 and I've never really made money on it other than price appreciation and then sometimes not so much the price appreciation. So how can I earn money passively, sort of like rental property, right? How can I own money without giving up access to my crypto or loan it and all that? And so I told those guys, listen, I'm going to do this, but I'm going to be public about it and I'm going to be transparent and, and I'm going to give the results whether they're great, mixed, whatever. And to their credit they were like, do it. You know what I mean? Absolutely. And so, but Dan and them helped me with setting the algos up and stuff. But I gotta tell you, it is great getting an email in the morning from Gemini or TradingView that says, oh, you know your algo trade. I bought at 2 in the morning where I was in court and I come out of court and I sold a little, which I would have never done. So I'm a big proponent and my whole approach is if you can give products to regular people that have been excluded primarily, right? The galaxies, the coinbases, the hedge funds, a 16Cs of the world, they get this stuff. Regular people have been excluded from it and you can improve their lives, help them build wealth, attack that wealth gap that we were talking about and make money then, Jesus, that's what capitalism is all about, you know, and that's a Beautiful thing. So I'm a big proponent right now of it for sure.
- [22:20]
A
So I gotta ask you, we talked earlier about Elizabeth Warren being out there trying to whip the votes, and she still seems to have a little more power, I think, than we would like. There is a world where the Senate flips and she becomes the head of the Finance Committee again.
- [22:35]
B
She does.
- [22:36]
A
Very soon.
- [22:37]
B
She does. And that's why I'm hoping when you and I first talked after the election, what's frustrating is we go from one extreme to the other, but no real reform is done. So the boot of the government's on the neck of the industry. The spot ETF coinbase is giving an ipo two years later, they're an illegal business, allegedly. All this nonsense going on to Trump meme coin and strategic Bitcoin Reserve. But are we getting real reform? Because once the Senate flips, and it'll eventually flip again, everything flips. If there's a new president and she has a lot of say like she did the last president before President Trump, then we're going to go back to square one. And so we really need this opportunity. We need that stable COIN legislation, we need a market structure bill, we need those consumer protections to get done. Because then if it flips, you won't be able to just undo an executive order. It's legislation. And once it's in there, you know, I think it'll be very difficult to go back to the old anti crypto army days if we get that done.
- [23:50]
A
Would you ever run again if there.
- [23:53]
B
Was a path to victory? I ran against her. It was February 1st. No one was stepping up. She had. Her bill was banning self custody of bitcoin in the United States, gaslighting the world. I knew the chances were slim to none, but I stepped up. I want a path to victory.
- [24:09]
A
You didn't just step up. You spent a million dollars of your own money to start.
- [24:13]
B
True. And it did feel good to stand stage and call her corrupt to her face.
- [24:17]
A
So worth every penny.
- [24:19]
B
It was, it was worth those debates. It was just seeing her face.
- [24:22]
A
My God, you murdered her.
- [24:24]
B
When. When I brought up Epstein and all that stuff, just looking at her face told her she sucked to her face. It was, it was fun. But if there's a path to victory. There was a poll that showed that a group of people want me to run again. Did a. They paid for a poll and it showed that I could beat Ed Markey between three and seven points if I run. But I wouldn't run if, if, if President Trump didn't support it for me and supported someone else. I'm not gonna run against the president, you know, I'm not gonna run against. Especially on policies I support. Cause the primary in Massachusetts is September. So what you end up doing is you. I won the primary by 65% last time. I had 800 grand left in the bank. She had 25 million. And I got nine weeks to try to win a general. You can't. So if the president was on board with my candidacy and there was no primary opponent, sure, I would absolutely run. Because I'm not young. But first year. Ed Markey went to Washington D.C. i was nine. Nine. So you can imagine the campaign ad will be him in that year and me holding a teddy bear or something.
- [25:44]
A
I can't wait to see it, man. Thank you so much for everything you do, man.
- [25:47]
B
Thanks, man. Oh, wait a minute, wait a minute. I forgot to give you. Oh, God.
- [25:50]
A
What happened?
- [25:51]
B
Here we go. You gotta dress you up.
- [25:52]
A
Come on, man.
- [25:54]
B
There you go.
- [25:54]
A
I look like one of the McDonald's dudes. That was a good look for me. There you go, finally. Formal.
- [26:02]
B
My gift to you, brother.
- [26:03]
A
Thank you. I'm gonna wear it the rest of the day, AKA the next five minutes.
- [26:07]
B
Thanks.
- [26:07]
A
This incredible conversation was recorded live in the Arch Public Lounge at Bitcoin Las Vegas. It's a dollar cost average into Bitcoin efficiently. And to check out all the other algorithms go to archpublic. Com. That's dope.