DON'T DO THIS... Everyone know's buy low and sell high, but ignore it | Adam Back

Why would they sell at this time? Seems like a really strange time to be selling Bitcoin, given that we're, to my mind, still in the relatively early days of the bull market.

Surprisingly, what it seems to have done is it seems to orange peel all those people. When in the US we have the Black Friday sales right after Thanksgiving, and people stand in line at 6:00 a.m. to go save money on whatever electronics or whatever. But when financial assets go on sale, we don't think about it like that. We're like, "Oh, I don't want to buy it now. It's on sale."

Yeah. I mean, it's really a bit of a trap with Bitcoin because people will... All right, Adam, we're here at the Bitcoin conference. Um, you're like the OG OG Bitcoiner. First of all, I want to dig into like some of the big excitement that we have going on with the Bitcoin Treasury companies. I know you're all about that right now. There's a lot of things that you're doing in that space, but how far have we come in the last 15 years?

Yeah. Well, I think we got a kind of growth spurt in terms of metrics since, you know, the last... Well, I guess the spot ETFs was a big one, but that was by the courts. So it wasn't like the SEC approved it willingly. Um, but now with the current administration, they're more open for business. And so I think we kind of got a lot of metrics caught up with where they would have been without that friction the last few years. So, you know, the regulatory environment for the traditional custodians of shares are now cleared to, you know, custody Bitcoin. They got, they got some work to do, but they they're able to do it. And you know, more of a wave of financial institutions offering acclimated products because those things take a while to to land because they will say they're going to do it, but then they're going to spend months figuring out the guidelines for their advisors and what allocations they can advise and things like that. So probably in market terms, going to land in the, you know, short, you know, the next six months or something in some of them.

Um, and confusingly, the price is only $110,000. It feels cheap with the context, right? Because, you know, we got to what, $73,000 before the halving, $73 and a half. It's not that much higher. And the amount of positive news, announcements from financial institutions or from wealth plans, you know, the ETF inflows, all of these things are enormous. And, you know, between MicroStrategy alone, that's two times the mined Bitcoin per day since the halving, and BlackRock, I I bit another two times. You know, there are traders on Bitfinex at times absorbing one or two times more depending on market conditions. So it's implying if it falls back and yeah, and and somehow the price is, you know... The question is, who, who is selling? Like, why would you? What's, what's, you know, what's going in their head? Why would they sell at this time? It seems like a really strange time to be selling in Bitcoin, given that we're, to my mind, still in the relatively early days of a bull market with all of the metrics, you know, running really high.

So, uh, one of the on-chain metrics where people try to guess based on, you know, which age UTXOs they see moving. It's an indicator and it's noisy, but it looks like some people have been holding Bitcoin for a year and a half, two years. So, maybe they bought in the previous bull market around the $60,000 mark. Perhaps they didn't enjoy watching it dip to $15 and a half. Yeah. And so, they're like, "Okay, they're selling potentially." Um, and so maybe maybe that's going on, but, you know, whoever is selling, you know, there's a lot of buying. They have to run out of coins to sell sooner or later. Yeah. So, I think that's when it gets interesting again.

I mean, yeah, we're we're we're saying it's not very high, but I mean, we just had an all-time high in the last week a few times, right? So, so it's it's on the move again, still. Yeah. I want to dig more into those metrics and some of the things that you're working on and and where where this is all going, but if we go back a little bit to the point that you're making, right? We have this big pivotal shift in in politics. And I think what you were saying is maybe the industry as a whole, maybe Bitcoin as a whole, was sort of almost suppressed potentially by this political environment that we had. And now it's sort of got some catch-up to do now because the political winds have changed. Right. Right.

Um, so so that's happening and there's enormous buying, but of course, as I was thinking, you said it, that means people are selling as well. Somebody sells it. Yeah. And and so, you know, I see there's a lot of people, and you're the original like cypherpunk, and so I see a lot of people online saying, "But Bitcoin's losing its cypherpunk roots, and now it's going corporate, and now everybody's begging for the government to buy it and these types of things." What would your response be to that?

Um, well, I don't I don't really feel that because the, you know, the question is, when new people come in, what is their mindset and what do they learn from participating in Bitcoin? And so so if you go back a few years, people were not sure. Uh, I mean, they they would call it the suits coming, but, you know, the professionals, the asset managers, the advisors, the wealth management companies, say, um, you know, are they going to absorb the ethos and, you know, politicians and so on and and dilute, dilute it basically, right? So you could have a financial success but get quite diluted in terms of its its mission, its ethos as, uh, kind of permissionless global money, right? Which is a pretty radical thing. And, um, surprisingly, actually, what it seems to have done is it seems to orange peel all those people. So, you know, you have politicians who are clearly up to here in terms of personal Bitcoin allocation, who actually get it. Yeah. Now, it seems like we have a president who actually gets it too, right? And and part of that was situational that he got politically debanked, right? It clicked, right? One of the, Eric Trump had specifically said that, you know, the game debanked made it real for them, right? So, and, you know, something similar with El Salvador when they first started the Bitcoin thing. Initially, people were unsure, you know, is is it a politician sort of following a popular trend to, you know, to get elected or to bring in band investment or because it's a hot thing? But then it turned out that, you know, actually he was patient zero in El Salvador. He was the guy that was like pushing it, and they actually got it in a big way, right? So, uh, what what it seems like is that the sort of, uh, incentive alignment of hard money brings wholesome incentives to all kinds of situations is scaling much better than we might have worried in terms of, you know, initially mining and trading by individuals, and then, you know, private companies, and then public companies, and, you know, the ethos is is doing well just in a scaled way. And the incentives are holding together in terms of, you know, securing the network and the balance of economic incentives to participate in in the market and in mining and in building products and services on Bitcoin. So, surprisingly, it's so far it seems to scale all the way. And there's a couple more levels to go because the, you know, while there are a few sovereign things like the Swiss National Bank has some exposure, by MicroStrategy, I think about 1% of the US equities in MicroStrategy, and that will change over time. Yeah, presumably. And, uh, Abu Dhabi sovereign wealth funds, um, Bhutan, El Salvador, and some others, but those are actually quite small percentages.

Another another indication of institutional interest levels is, uh, somebody went through the BlackRock IBIT filings and they could see of the people that are obliged to disclose, about 33% was institutional ownership. Um, but nevertheless, you know, that that's that's that's a nice number. And I would say the other ETF holders where an ETF was a simpler interface is sort of accessibility, right? Yeah. So for the crowd that when they want to make an investment, they call their financial advisor, they call a broker, and they couldn't do it before. Or or, you know, then the futures ETFs are not not attractive products, right? So I would say that is the sort of top 10% of wealth in the US minus the top 1%. So not the super high net worth, but just professionals, doctors, dentists, business people, people with a portfolio that they, you know, taking an interest in. Yeah. Uh, maybe have somebody else manage, but, you know, have some input into it. And it's not, you know, it's not new money. They're just reallocating something in a portfolio. So, I think the fact that they are, they're reallocating in a portfolio and they're longer-term investors, it turns out we didn't know what to expect, but they're also quite long-term investors. So, they, it, it's good type of investor to have because they're not going to panic sell when it drops by percent. You better think they might buy some more. You saw that in some of the metrics. So, that's interesting to see evolve. It means the the money multiplier, like how much capital needs to come into Bitcoin to push it into a next layer, is less. So, you know, you you get higher multiple on the market cap versus the money in if you have these kind of investors. That's interesting. So the, so if you have stronger hands coming in, more patient buyers, so the point I think to what you're making earlier was, who's the sellers? And the sellers are people who probably bought around the $60,000 level. They went through the bare market through 2022. Uh, they didn't like that. Yes, they got fatigued. Basically, they got fatigued. They sold out. Uh, the markets move from impatient to patient. Now we have the patient buyers, sovereign wealth funds who are thinking generations ahead. So then a lot of this Bitcoin goes into deep dark cold storage, hopefully. And I think that then I guess the point you're saying is that when we have that shift of short-term buyers to long-term buyers, um, it, I guess, it removes the amount of available circulating Bitcoin, right? And when that happens, then it takes less money coming into the market to get a higher multiple off of that, right? And so then while most people would think that as the market cap of Bitcoin gets bigger, the volatility goes down, maybe what you're saying, possibly, we still have the upside potential, but it limits or li or dampens the downside. Yeah. Yeah.

So so yeah, Bstream uh recruited this uh uh hedge fund manager and he had Sean Bill and he had a a period where he worked on pension funds. So, uh, we we, you know, went to talk to some pension funds the last couple of weeks, the fund, you know, fund managers and the fund administrators, um, to, you know, see what it takes to get them off zero. They're still quite early in their thinking. They're asking very talented questions. Um, but one of the graphs that Sean assembled is, uh, a kind of volatility distribution, which shows that Bitcoin has a fat tail to the right, which says it has like high volatility, but it's biased to the upside and asymmetric. Yeah. Whereas, you know, the the US stock index is more normal, more normal distribution. They got down and up. I mean, there are downsides too, but the the upsides are bigger, basically. So that's an interesting data point. Um, so yeah, I mean, I think that's, you know, they call it redistribution, right? That, you know, previous generation people sell. Ultimately, it's a story of Bitcoin's market behavior is, you know, the dips exist to transfer Bitcoin from weak hands to stronger hands. So it's kind of evolution, like biological evolution. The people who for some reason are stubborn or persistent or value investors end up the winners holding the Bitcoin. People that are, you know, new to investing or can't stomach volatility, they get shaken out because it's, it is a wild experience, even for somebody with, um, equity investment experience, because the volatility is just much lower in the equity world. Yeah. But it is, I think it is, uh, you know, you can see over the long term that the volatility is dropping a bit in Bitcoin. I think, you know, these kinds of investors who are managing a portfolio, they can reallocate. I think the, you know, the message that Sean brought to the pension funds, he was managing the first US pension fund that put on a balance sheet. This is a Clara VTA, and it was recommending around two to 3% allocation with the argument that, you know, if if Bitcoin halves, they could make it back in a couple months with their normal, you know, fixed income diversified strategies. And that under his administration, that pension fund did quite well. They achieved a 10% slightly over 10% return for 10 years. Wow. In a row, which is good. It's a good, you know, top quartile return for a pension fund. And, um, if Bitcoin did what it did in the past, so, you know, when he started talking to them, Bitcoin was $7,000. Uh, by the time he got the allocation in, it was $17,000. So you're already quite a bit up from there. And, um, but that allocation alone would fill in the remainder of their unfunded pension liability. So, but typically those funds are doing rebalancing every quarter. And a key thing with this allocation is you are trying to capture the asymmetric upside. So you make a small allocation to manage the volatility risk. Pension funds don't like drawdowns, right? Because they're predictable period, but you got to you got to not rebalance it. You just give away the upside quarterly, right? So not not rebalance the Bitcoin. Yeah. Let that run for, you know, so rebalance the equities, but let the Bitcoin continue. I mean, they they do rebalance the the equities and and they're in different sectors, you know, so they'll be in some forestry or some farmland or different times. They, uh, it's going to be diversified and they will they'll monitor those segments. Yeah. And rebalance, um, and they've statistically shown that that that helps portfolio, right? But with a bit with this thesis with a Bitcoin, you're going for asymmetric upside. Rebalancing for that specifically, it's a bad, bad idea. Just stay the course. Yeah. Keep it five years at least, and historically, if it repeats, will do well. Yeah. Yeah. Um, let your winners run, like let let that thing go.

You've been here since the beginning, so you've gone through some pretty extreme long drawdowns. Yeah. Y. So you've seen that, you know, I I got I started buying around 2015. So I went through the, you know, 2018, 2019 drawdown. And I remember thinking, "Oh man, why didn't I, why didn't I sell? Is it ever going to come back?" And Right. Right. Um, it did. And then I remember in 2020 when it plunged with the COVID uh crash, and I'm like, "Oh man, this is it. The markets are done." You know, and then yeah. Um, I never sold any. Um, I didn't buy as aggressively as I should have on the dips, but I, but I managed to hold through. And I sort of become numb to the rise at $110,000 because I don't want to get depressed on the on the crash either, right? Um, how have you managed to kind of think through that on these these the euphoria and then the then the crash?

Yeah, I mean, actually, of course, it depends on people's background, right? But the average person is not self-managing their portfolios. So then, you know, when they get into Bitcoin, it's their first trading or, you know, first self-managed investment. Yeah. And it's a wild introduction to investment. So I was lucky to have, um, you know, in the early n, the sort of early to mid-90s, I was managing my own savings and trading with Erades, uh, in the UK equities market, and, uh, an IPO and, you know, different sectors, stock trading, bit of a day trader, basically. So, I was kind of new to it, amateur-ish, and, um, but you get to learn, you know, to handle the roller coaster of of the market volatility. And you're, you know, you're you're buying individual stocks, so they can move dramatically even if the index doesn't so much. And, but, but even then, as a trader, you are buying and selling. You're not really sitting through the volatility. Yeah. Yeah. So, so what basically I learned the hard way. So, I was doing that and the market was rising. So, you know, uh, you couldn't go that far wrong, basically. Yeah. And so, I did the day trader thing. U, but then, you know, the market got through it, got into a bare cycle, so I was like, "Oh, I don't like this." But I didn't, I was stubborn. I didn't want to like realize a loss. Yeah. So, instead, I got more, uh, sort of scientific and started looking at, you know, why would you want to hold this individual stock in a bare market? You know, people need healthcare, they need banking, and just start paying attention to the fundamentals, looking at the company specifics, and changed my outlook to be more of a value investor. Okay. And, you know, eventually the market came back and it was fine, right? Uh, so I got my introduction to like trading thing there. And, um, yeah, so when Bitcoin came along, I was like, wow, this is, this looks fun. Let's let's trade this, right? But you learn like really fast. Is like, so at the beginning, I was like thinking about trading it. And then I realized like, well, wait a minute, it's going up exponentially and it's, but it's highly volatile, like 2013, right? So I was like, well, logically, if you, you know, if you were selling, you know, if you don't, if you don't, if you're selling, what you're saying is you, you're hoping it's going to fall so you can buy back lower, right? But if it's going up exponentially with high volatility, the odds are stacked against you, like a really bad casino rate, probably that's a dumb idea. So, so again, it's like, okay, let's just like buy more and not not sell, uh, if you can. And if you want to like trade, maybe pick an allocation and try to buy when it falls or something like that, right? Um, and so, yeah, and I think along the way somewhere in there, my, uh, my benchmark shifted. So originally I was in, you know, some mixture of pounds and dollars and euros and things. I was working internationally and I gave up worrying about the forex. I was like, "Okay, I've got a basket of currencies. Who cares what happens to the British pound versus the euro versus the dollar?" And then I, um, yeah, so so I basically realized that, well, actually, I was starting to care more is the number of Bitcoin I have going up, not the the dollar value of it. So I kind of redenominated in my mind the portfolio value to Bitcoin. And then it, then it was a lot easier, right? If you just sit through a bare market, it's like, well, I managed to buy a little bit more Bitcoin, price was lower, this is good, right? Like one Bitcoin is one Bitcoin. Became kind of a thing. Actually, I really didn't care because I was convinced, you know, just volatility, it will come back in the next cycle. But to your point about, you know, the COVID drawdown, yeah, that, I mean, that was pretty dramatic. And as the previous one, I mean, they they go back further, right? I I don't get active until 2013, but the one I got to experience first was the run-up to $1,300, and it gradually fell like $300 and $200, and it dipped below $200, which I think was a kind of previous psychological number, okay, that it achieved, and people did not like that. They were like, oh no, it's falling off the $200. That was that was like the kind of flaw, right? Okay. And it fell off and like, oh, it's all over, it's going to zero. But it only lasted for a day. Um, so at that point, I was like, well, you know, it feels pretty scary, but I guess this is the moment to buy some more. Yeah. So, I actually managed to do it. I thought it was good. And I called somebody who'd been sitting on the fence about, oh, maybe I should buy some Bitcoin. I was like, do it now if you're going to do it. Yeah. And they did. So, it's crazy.

You know, in in the US, we have the Black Friday sales right after Thanksgiving, and people stand in line at 6:00 a.m. to go save money on, uh, whatever electronics or whatever. But when financial assets go on sale, we don't think about it like that. We're like, "Oh, I don't want to buy it now. It's on sale." Which is, uh, sort of a strange. Yeah. I mean, it's really a bit of a trap with Bitcoin because people will oscillate between, you know, they'll see a price target. It's $110,000. Oh, it got it got to almost $75,000 not very long ago. I'll buy it when it gets to $75,000, right? And and it probably will never happen. Or if it does happen, they'll get scared again. Oh, maybe it'll fall to $60,000. I heard scared now. Is $75,000 defensible? And so they get stuck in this kind of psychological trap. So, you know, you can look at different ways, but dollar cost averaging is kind of a way to do something in the middle, right? By by some lump, dollar cost average, then you won't feel bad. And I think also newcomers don't really have a view of the market cycle timing because I know it's, you know, there are not that many samples. And the last cycle had an extra all-time high right at the end of the cycle, which is unusual.

But, um, now you said earlier that, um, given all the news that's happened, um, you feel that $110,000 is cheap. $110,000 is cheap. Uh, most people that I listen to, not here at this event, but most people, they say, "Well, Bitcoin is too expensive." So they're looking at in the past, well, it's not $10 or $1,000 or $10,000. Now it's too expensive. You're thinking it's too cheap. Yeah. Because you're looking in the windshield, not the rearview mirror, right? Looking at where we're going. Yeah. Yeah.

I mean, I think, you know, one way to, yeah, I was just looking at, you know, the relative price at $69,000 previous bull market or $73 and a half in the second top last cycle, and the fundamentals like the news flow and the fundamentals at that point. Everything is just much, much better now from the fundamentals and the consistent buying. There are less new coins being mined. Coins on exchange are shrinking. Say, "Yeah, I think the price should be much higher." Yeah. And I'm guessing it will get there sooner or later because the sellers will just simply run out of coins to sell, or they'll get their mojo back and decide that, wait a minute, it's taking another run. Let's buy it back at a higher price. That's what people do, right? So, they sell and they're like, "Oh, no, it's going up." And they everyone knows they're supposed to buy low and sell high, but they all do the opposite. Right. Right. Right.

The other thing I think it's a nice, uh, thing to look at for people to deal with volatility and to think about it is there's a metric, the 200-day moving average, which is the four-year average price, basically. And that is a really nice number because it, it never falls. It's always going up, you know, slowly or fast depending on the stage of the market. And it's generally a floor price. Like Bitcoin for many years, never closed a month below that price, even in a bare market. During COVID, it closed a little bit, but, you know, in a bull market, it's nowhere near it. And that number is creeping up. And I think at the moment, it's like $47,000. So we're somewhere between $47,000 and $48,000. So if you think about that as a potential floor where Bitcoin is unlikely to fall beneath that as your kind of bankable value, and then everything above that is volatility. Yeah. Then you can be calmer about it. And if you keep that as your your anchor, then you know, you won't, you won't, uh, get so, it won't feel so dramatic when it drops 30%.

Yeah, I think the other thing that, you know, zoom out is a good, good thing because, uh, yeah, people have a nice chance of previous bull runs where there's been like five or six 20 to 30% drops right on the way to a bull market that's gone up like 100 times in a cycle or something. So, you know, we had a 35% drop there from like, what did we get to like $109,000 and then down to like $75, $74. So, it's like 35%ish. Um, about 30%. Yeah. But I mean, that's normal, right? I mean, going back to the 2022 dip, um, since then, I think we've had nine pullbacks of 25% or more in that period. Oh, yeah. Okay. So, yeah. So, it's just normal. Um, I want to get back into some of these Bitcoin Treasury stuff and um, things that I know that you're working on. Um, and sort of just taking that back. First thing I just want to address though, quickly, you mentioned like the suits coming. It's the first time I've actually ever worn a suit at a Bitcoin conference. I'm usually the Mr. Black T-shirt guy. Uh, but the corporations are here, right? The suits. I guess I'm one of them now. Um, but, you know, one thing that people think about is, um, unfortunately, the distribution from the decentralized sort of retail, um, you know, people that came to it originally, and now sort of transfer into the to the corporations, if you will, the institutions. Um, you mentioned that it's, uh, people think that maybe they could change Bitcoin, but Bitcoin changes them. Seems like it, seems like it, and I would agree with that. Um, but do you see danger in it becoming too centralized, um, with all the corporations and institutions and the sovereigns coming in?

Yeah, I mean, I think, you know, you can look at, uh, the fork drama, like 2015 to 2017, as the block size wars. Yeah. As an example where the, I mean, I would say that was resolved by the market. People going into, people were uncertain about what was going to happen. You know, some people thought the miners were decision makers, or the exchanges, or developers. But actually, Mr. Market made the decision, and everybody looks ashamed to go on with. Yeah. So, so, and like now that we've seen that, okay, that seems reasonable now, right? You got radical free market money, the market will resolve whatever debates there are. Yeah. And so with that precedent, that's good because it gives you the predictability. You know, next time it won't be as dramatic because you go, never mind, you just, you know, short the future if you disagree with it. Yeah. If the if the ecosystem guys. So I think, you know, it was interesting to watch that because the activist investors, you know, the people that were like, were not really sure what to do, or thought it might be mildly good for companies in the retail payment space, they'll be blocked. But like, it would be nice, but they weren't willing to like die in a financial bubble. Right. Right. And and the guys that were, um, you know, the early early investors, the people it was really a mission for, they weren't, they were kind of ferocious in a market and all in. And so, of course, they won. What happens in a market, right? So, um, people sit on the fence, they're not, their voice isn't naturally heard in the market. So, so I think that's that's one factor. And then, you know, the the custodian effects because with the ETFs and the treasury companies, they are now companies that are fiduciaries for their investors, or in an ETF, you know, the unit holders, who are they're just, uh, managing the security of it, basically, right? Yeah. There's no kind of management discretion on there. So, I think that they are, you know, you probably don't want too much in the hands of, uh, professional asset managers because you want the activist investors. You're looking at the network and, you know, speaking up or trading if they see something coming off the rails. But I think ultimately, if, you know, if one ETF or one treasury company try to pick a side in a future policy kind of debate, um, there is feedback though, which is people will sell their units and they'll buy another, right? So if they lose their assets under management, that drops to zero, they're out of business, right? I think that that will make them, you know, pay attention that maybe that's not what people want. So it's a feedback loop. But I do think you don't want too much in ETFs, but, you know, Bitcoin's distribution, um, helps. And like I say, if people care about decentralization, buy some Bitcoin, cold store it. Yeah. Or take it out of the ETF. Now you can, you can fix it, you know. So, yeah, in in Bitcoin, you can't really sort of complain to somebody, you could do it yourself, right? So if you care about something, you buy, buy in cold store. And of course, as you said, you know, the people, the cohort that are selling Bitcoin from a couple years ago, you know, they're doing the opposite, right, which is they're they're selling the coins to the sovereign wealth funds and to the treasury companies and the ETFs and BlackRock. So as well as the ETF, BlackRock did something else interesting, which is they recently made, like a position paper suggesting a 2% allocation for diversified funds, which is a helpful, uh, reference point for people like Sean, who are making a similar recommendation in 2019, but now they can say, well, BlackRock also is saying something similar, right? So people will, in a finance world, will feel that BlackRock's saying it kind of covers them, you know, as if that goes wrong, or people will feel comfort that there's multiple people recommending it. So then you don't see the centralization from the ETFs or the corporations as a big problem, as long as people continue to exercise their ability to vote with their money, I guess. Yeah. Um, as long as it's not too extreme, I think it's it's okay. And it's is providing a value to the market, which is making Bitcoin more accessible to a wide range of people. And, you know, I mean, about the the suits thing, now, I think there's a bit of a misnomer there because people have a kind of simplified view of the world, but actually almost all of the money being managed by professional asset managers is money of individuals. You know, it's their pension funds or like insurance policy, it's a managed like a mutual fund or some managed fund, right? And so, you know, that that is good for the individual. So, you know, with the pension fund that got Bitcoin in there, you know, that was actually the transport authority, right? So, it's the policemen, firefighters, train drivers, right? All these guys who, you know, they they're going about their lives. They're not focusing on, you know, manually investing. So, if there's a Bitcoin in there and it improves their pension, that's good, right? Yeah. Yeah.

And I think there's also aligned interest there as well. Well, if you think about, um, you know, whatever ETF or whichever fund, I mean, they want Bitcoin to remain valuable. Otherwise, they lose their business. And if you break the decentralization, then Bitcoin loses the value, and then they're sort of shooting themselves in the foot a little bit, right? So, from that standpoint, it seems like we're at least aligned economically to keep it decentralized and secure. Yeah.

Um, what about so we have been having almost another sort of not really a block size war debate, but there's been a debate, uh, going on recently about, um, the block size, uh, was it the OPNET? Oh, yeah, the OpReturn, that that thing. Yeah. And, uh, you know, expanding that, obviously, then there's like, well, how about we have a different, uh, the knots, you know, protocol, uh, taken off? How do you look at, uh, something like that? I mean, do you think that there should be something done, or you're also sort of the same thing, we're like, let the market sort of decide how that plays out?

Yeah. I mean, it's, um, it's kind of side effects of a censorship-resistant, permissionless network is you can't stop people. They can do whatever they want, right? You pay the fees. They can fill it with cat pictures if they really want to. Right. Now, that's kind of disappointing because there are, you, there's uneven wealth distribution in the world, and the best of the, the hardest and strongest sort of asset protection assurances from holding direct on-chain UTXOs in hardcore world or something, right? So, you know, outside of the Bitcoin space, your options are like offshore banking, maybe real estate in Florida, you know, life insurance wrappers. There, there are more things that people do for asset protection purposes. And Bitcoin lowers the barrier to entry to that. And, you know, being able to protect your assets is a big deal in some parts of the of the world, right? Um, so, you know, ultimately, if in global terms, wealthy, uh, people having fun with NFTs and things are clogging up the chain with, you know, the latest fraud thing, they're effectively pricing out some emerging market people from owning a UTXO. So, they're going to get to be, you know, they'll have to do it in a less secure way, right? They'll have to use a custodian or something else. So, that's kind of unfortunate. And of course, the the thing that's creating that is it's hard to scale blockchain by the technological limits, which people are trying to improve, but at the moment, it is what it is. So, yeah, I mean, I think you, you can't really do that much about it. Um, there are some kind of loose things in the network that make it more work to bypass the sort of anti-spam, like common sense limits in the network to keep the network healthy. But, you know, it doesn't do that much because they can, uh, use a minor, like a pool or a minor's accelerator API, they can bypass all the policy limits. So, and I mean, the other funny thing about the operator is that's not what people are using. They're using, uh, uh, some other script like Taproot script because they get 75% discount on the fees. Do that. So actually the operator has not been used for the images anymore. So the debate was kind of a little bit missold in terms of what it was about. Um, it's actually about, uh, some kind of layer 2 anchor transaction that was hitting the limit, which was I think 80 bytes, and they were like 128. So, it didn't quite fit, and they didn't want to use an accelerator because they care about decentralization because if their anchor transaction doesn't make it in, they could lose money on the layer 2. They really wanted it to be standard in the network. So, they did some other trick, which is, uh, uses up memory. So, it's not ideal anyway. So, I think still a little bit in progress, but probably they'll just do some kind of simple change to accommodate that. I think there's like a little bit of a blown drama, but, um, I think the things to bear in mind is you can't do anything about it, right? So, um, it's a side effect of permissionlessness, right? Yeah. Yeah.

Well, they're making a change to allow more of it, right? Or not was then making a change to be able to censor it, right? Yeah. I mean, I think the debate is because even, you know, there's there's two types of, uh, rule in the network. One is a sort of node policy or minor policy, and that, you know, that the node can say, well, I don't, I don't relay that, or I won't mine that. But there's a, the actual consensus rule, which is the rule that matters for whether a transaction or a block is valid. That one you can bypass by get, you know, you can get to that one by going directly to a minor or to a pool. And so even with not, you know, people can still bypass it, and that's what they're doing, right? Yeah. So, it's it's not that, you know, I think the problem is people like are annoyed about the spam, as they want to fight back. Yeah. Is like, why don't we do this? Even if it's not very effective, they want to push back. Right. And then the other counterargument is, well, it doesn't, you know, people are already bypassing it, won't really have much effect. So, you get this kind of, you know, no clear strategy is going to win, an arms race type of thing, right? So, it's kind of a by trade-off. I don't, I don't have the technical detail, you know, tech technical, um, capabilities to really sort of understand it, but I'd sort of look at it in the same way, which is sort of like the free market can sort of win. And like, right now, the block space is pretty empty. Yeah. And if economic transactions aren't more valuable than spam, then that's a problem. Yeah. And if someone's willing to pay for it, is it spam? Because then you're trying to say someone else, someone else's value is not valuable. Right. Right.

Well, I mean, um, yeah, I, I think the free market does, you know, does resolve it in a way because there are times when the Bitcoin transaction fees are very high, and then they don't want to, you know, right, they get pushed out, right? The use cases get pushed out. And so I think the, you know, the network kind of oscillates between low and high fees. So probably, you know, when when there's a big run-up in Bitcoin price, the traders tend to push the fees up because they don't, they don't really care what the fees are because they're paying maybe 10 basis points to an exchange commission, and the fee is is nominal and it's like irrelevant, and they want to get in the next block because they're trying to trade. So they'll just like, what's the fee? And they'll just pay twice as much, and then they'll just like push the fees up, right? So that's really the driver, but it goes through cycles. Um, so, yeah, I mean, I don't know, this was just normal drama. Yeah, normal drama.

I mean, the treasury company angle is, uh, an interesting, yeah, trend as well. There was an event a couple days ago here, first day at a conference, where had a number of the treasury companies, uh, speaking like panels talking about their their company experiences. And apparently, there are at this point 80 such companies globally of various sizes. You know, if you, if you ask somebody to name them, they'd probably only be able to name like five or 10, right? But there are apparently many more in different parts of the world. So, it's, it's a growing phenomena. And then as an effect, it's been something people are grappling with. So, people from the Bitcoin ecosystem, like Bitcoin holders, some of them are skeptical, like, well, why, why can a company charge a premium above the Bitcoin price? You know, they'll say, well, you know, why are you paying $200,000 for a Bitcoin inside this company? And the traditional finance people who are used to valuing companies based on cash flow, some of those are also confused to say, well, why isn't the value of the Bitcoin on the balance sheet, you know, the net asset value like one multiple, right, plus the enterprise value? And so, I think it's things people are still getting to grips with. And I've been, you know, involved in trading them for a few years. I got interested in sort of supporting MicroStrategy early on because, you know, initially they just took their investment to protect against inflation, eroding their, they had half a half a billion cash reserves from the company. And during COVID, they were worried that it was just shrinking at 10% a year and there's nothing they could do. You know, the treasury rates were really low. Uh, so they they hit on the idea of using Bitcoin, but after that, they they turn around it and get by more and more, right? Uh, so it started this sort of exploration of phenomena. So I, I, I invested in it partly because I wanted to support what Sailor was doing, which was he was sort of trying to orange pill the corporate world, like the company world, to using Bitcoin as a reserve asset, a company reserve asset. And, you know, then when you are trading those things, you, you try to figure out like economically what's going on. And, you know, you're by buying it, a premium, you got to form a, If you're a value investor, which is my outword, you want to feel that that premium is defensible. Like why is it there? Is it going to hold on to that premium long time, or is it going to collapse? Right? Is it like a bubble when it's going to collapse? And so the way I was able to, you know, persuade myself that it's safe to invest in a two times premium is you can look at it historically, like it bounces between, I don't know, maybe one and a half and three and a half in a bare market, but it's a bull market, and maybe between, you know, 1.5 and two and three, you know, in the last six months, probably. And, um, so you can look at the range and say, well, it's lower than the middle of the range. So you could buy some. But that's just super expensive. Yeah. I mean, that's just like looking at the market. But then this should be like a fundamental reason. Why does it even have a premium? And so I, I think there's a reason, which is that it's generating yield. So not in a normal interest sense, but they're increasing the Bitcoin per share and annualized rate. And in 2024, MicroStrategy achieved 73 and a half percent increase in Bitcoin per share. And in 2025, year to date, it did did some more. So it's over two times from January 2024. And so my argument is, well, if you would have bought MicroStrategy in January 2024, it's now paid for that risk. Now it's, you know, that's the days to cover metric. Yeah. So that that was kind of that thinking was a genesis of that. And I tried to put like a calculation on it. Well, you know, what are you really saying? Well, it's just how many months, how many days does it take until the yield catches up with the current M&F? And so you can look at that historically and say, well, in MicroStrategy's case, it was about 18 months. So it's moving around quite quickly, right? Um, so if you, you know, if you buy it and you think in 18 months, there's more time to run, because the other part of the thinking is that when Bitcoin is fully adopted, you know, it reaches this, uh, you know, how Finn's 2009 Bitcoin could be addressable market, $200 trillion. I think we're starting to see that becoming much, much closer to reality. And so in buying this, so, and I think once Bitcoin does get the, the treasury strategy doesn't work nearly as well, right? Because we're mostly the effect is mostly mostly an arbitrage on the fact that Bitcoin is increasing by adoption very rapidly in a four-year period. But once it's fully adopted, doesn't have, you know, the dollar value won't increase that fast. Be more like an inflation hedge, right? So my thinking is just conservatively, you know, maybe it will do better, but conservatively, let's assume that the M&F drops to one, okay, once that's happened, you know, maybe that's in a couple of decades, you know, how long it takes. So the conservative is like, well, say it takes a decade, it'll drop to one. So if you're buying at two, if it doesn't achieve any yield, you're going to lose half your money by maturity rate in Bitcoin terms. But, um, that adoption is not, you know, not going to stop now in most Bitcoiners opinion, right? So you say, well, if it, if it, you know, it continues its adoption and it reaches this level, there's like a, you know, 100 times Bitcoin price appreciation between here and there in a few, you know, market cycles. So probably, you know, you will get, you know, it, it will cover the two times, um, M&F, you know, in the next year or, and then then you're covered, and the rest of it is upside. So the markets are discounting mechanisms, right? So we're trying to buy something cheaper today than it will be in the future. And so what you're saying is even though the MNAV we're buying, we're paying more for the Bitcoin today, um, at the rate of their continued appreciate or acquisition of more Bitcoin, then it'll cover and then we'll be in the positive in the future. So we are buying at a discount today based off where it'll be. Um, but then

We see that days to cover number, uh, vary quite a bit. So then why that? Um, well, it's the, I mean, the market price is changing. So, you know, that that will directly do it. It's like a little bit of volatility and, um, it will, you know, it will fall. I mean, at the moment, there's a short seller trying to short MicroStrategy, Jim Chanos. Yeah. And a short seller. Yeah. And, uh, and I mean, he's, he's not just straight out shorting, that'd be dangerous. He is long Bitcoin. I mean, he's a dollar investor, but he's long Bitcoin, short MicroStrategy. So he's trying to compress the MNAV. I think that's bad timing because it was already low. Yeah. And, and of course, you know, MicroStrategy is not standing still, right? They find more Bitcoin. It was 500,000 and now it's like 580. Yeah. It'll be 600, you know, soon enough. Yeah. And that's just adding pressure against Chanos's short, right? So I think he'll have to get out of the way sooner or later. Yeah.

Um, and then say that, so that's, you know, that's kind of short-term. There were a couple of other short funds that tried it. I think one of them went under, was Heisenberg Capital, and then Citron Research and Chanos. Yeah. So I think, I think like at least one of them blew out by doing it. It's a, it's a very dangerous doing anything shorting Bitcoin, very dangerous. Shorting MNAV also quite dangerous because it, it's elastic, as you just said, you know, it can be three, it can be two. That's a big margin for a short, right? So you're shorting some kind of Bitcoin derivative effect, and it's all very volatile, which is not a lot different than traditional stocks with like a PE ratio that could go from 47 to 52 or something like that. Yeah, it's, it's quite analogous to PE ratio in a. Yeah.

And then the other phenomena is that you see that different strategy companies have a different regime. So you can see that MetaPlanet and, uh, the Japanese hotel company, one, they have a very rapid rate of Bitcoin appreciation and the blockchain group, a newer one in Paris, a software company is the ticker. And, um, both MetaPlanet and OPG are increasing the Bitcoin per share much more rapidly. And so, you know, I was, so, you know, their MNAV on MetaPlanet has been between five and 10, which is much higher. You know, MicroStrategy is maybe like two to three, right? And so, you know, in, in buying MetaPlanet at five, which is lower into the range, you kind of feel it like, what, that's a big multiple, is it, is it safe or is it going to like fall to, you know, two or three like Strategy? And it's overshot now, right? And so that was my kind of wrestling with like, should I be buying this or is it already overplaying, right? And so then I got onto the monster cover and I realized that it's, you know, it's months to pay for that even that big premium. Premium was it was about 3.3 times at the time, but they had doubled the amount of Bitcoin on a balance sheet in one quarter. So it's a 16 times annualized. Yeah. So I mean, okay, maybe that's, you know, short-term effect and it's going to average a bit lower, but it's really aggressive. And say the monster cover was only like five or six months. So when you look at it like that, you know, as long as they keep something close to that track, buying at five, even five times or 3.3 at the time is actually, you know, relatively low risk. And so that, that is a useful, you know, metric. You got to overlay it with your risk perception of, you know, will they continue? Is it repeatable what they're doing? And are they execution focused? And some of these guys are like, Sailor is amazing at execution. Yeah. Just when you think he's done, he finds another billion from something else or 17 billion. Yeah. So never bet against Sailor, buy more Bitcoin, basically, is a message that they have delivered repeatedly to the markets. People are like, okay, but Chanos has given it a go. So good luck to the guy.

And what about OPG? So what we're seeing all also now is, so Sailor sort of created this strategy, name of the company, and now he's giving the strategy to other people, and they're following it. Um, and then we're starting to see different versions of it, variations of it. So OPG is doing it more on a like a bit bond. Yeah. Actually, it's quite innovative what they've done. So I mean, I think sometimes what people are doing is because the market, um, the available market raising mechanisms are different in different jurisdictions. So in the case of MetaPlanet, they're using moving strike warrants because they don't have an ATM and it has a similar effect. Apparently, they don't have a lot of debt, so it's basically at the market. And in the French one, they did something interesting, which is it's a convertible note technically, but it's a Bitcoin basis one. So the interesting thing there is they don't really have a debt ratio because what they'll do is they will accept Bitcoin in kind, or you could send in euros and they'll buy Bitcoin. And, and you have a, like with other convertibles, there's a conversion premium. If it goes up 30%, then you have the option to convert. And if it, you know, if it reaches maturity and it doesn't reach the conversion premium, they don't really have a credit risk because they just give the Bitcoin back. And then they put the Bitcoin in a separate special company, ring-fenced, and in custody of an independent custodian. And so they can actually sell a, a lot more convertible notes. So, you know, with, with the euro or the dollar basis convertible note, the companies sort of moderating how much debt ratio they take on. And, you know, MicroStrategy has said they want to keep it no more than 20 to 30% uh leverage, so 1.2 to 1.3. And of course, they can moderate it, right? They can build the leverage ratio up to 1.3, then they can sell some shares at the market, which reduces the debt ratio, and then they can do it again. So they kind of oscillate. Yeah. But in a, in a OPG, particularly because they, they're recent and they start small, they, um, you know, if, if that was debt, their debt ratio would be enormous. But because it's not debt, it's fine, right? So it enables them basically to move faster because they are, yeah, because they made so basically they have a debt instrument that doesn't create a debt liability effectively, right, with a conversion. So it's pretty interesting.

Now, of course, you know, your, the Bitcoin and the MNAV, if that eventuality happened, would shrink, right? Because they'd be giving back Bitcoin that people have thought was part of the formula. But nevertheless, the, you know, the, the situation, the scenario in which a treasury company would have to repay debt is that Bitcoin is lower in five years. They're generally trying to target five-year bonds, which is a pretty good time frame. Yeah. So most Bitcoiners are like, "Oh, I'll take those odds. That's unlikely, right?" But if it did happen, it might be painful for the company to refinance, right? They might have to sell shares very dilutively if they sold Bitcoin definitionally, but a lower price. And so it would be painful. And so then it brings into the question for the lender, well, you know, that's, that's the stress case risk. Can it pay back? Yeah. Right. And what MicroStrategy is doing is they're trying to, uh, double over-collateralize to provide assurance. So firstly, they've got, you know, average level cost Bitcoin and a lot of it. But secondly, they're generally, you know, selling, uh, you know, a billion of convertible notes and a billion of the ATN. So they bought two billion of Bitcoin and they got one billion of convertible debt. So that's kind of over-collateralization. Yeah. And, and then they're not doing it too much so that they don't create a debt ratio. But, you know, the most of the people that buy that converts in MicroStrategy are delta-neutral, uh, kind of arbitrage. So, you know, they'll buy 150 million, say, hedge funds specializing in this. They'll buy 150 million of a convert, they'll short 100 million of the stock, and what they're left with is a 50 million long-dated call option. And they will do a kind of option yield strategy on that. And MicroStrategy is fantastically volatile, more than Bitcoin. So they can have a lot of fun doing it. When it reaches the conversion premium, they'll sell it, buy the next tranche. Yeah. And so, you know, as, as they convert, the debt ratio is getting reset again. So it kind of sets a nice, uh, kind of sequence when it, MicroStrategy can bring more money in. These guys are bringing new types of money in that doesn't even care about direction of Bitcoin or even believe in it necessarily, right? But they can, they can help bring the capital in. That's, it's, it's interesting.

How many of these types of companies do you think the market can bear? Yeah, it's a very interesting question. So, uh, somebody I know in, in private banking or wealth management banking, uh, asked me this question. And I was like, huh, interesting question. Like, how scalable is it? You know, if, if Berkshire Hathaway and Apple and Microsoft plow in, will they compress the opportunity? And what I came to think about is actually no, it's enormous. It's effectively it's an arbitrage between you, the Bitcoin futures, 200 trillion, you know, Bitcoinized financial markets, which I think of as not displacing the fiat currencies, but sort of sucking out the monetary premium in everything. There's monetary premium in the stock market. If you take out the monetary expansion, the stock indexes haven't gone up that much. And monetary premium in real estate, in art, and other bonds, all kinds of things where people are trying to preserve their assets, so preserve their spending power. So if you, if you take the 200 trillion that is the size of the arbitrage, and then that's an enormous amount of money. So you can look at the treasury companies as one of the vehicles to arbitrage that future because they've got, you know, while Bitcoin's going up. Yeah. They can bring forward corporate capital mechanisms and buy that at a discount. And their actions are also applying pressure to Bitcoin, probably make bring that period forward. So kind of accelerate, you know, hard Bitcoinization basically. So from that point of view, I think it's very scalable. And you can see that Sailor, you know, was very relaxed about getting, he has an annual conference where he tries to encourage people and provide the playbook and explain the accounting rules he used. It's got a bit simpler now with the spot ETFs for companies to use those even. But, you know, clearly he's not feeling it's competitive in terms of, you know, for people who are doing an arbitrage. Sometimes they're trying to keep it quiet because they know that it's not very scalable and other people pile in, it'll disappear. But here, it's, it's an enormous dislocation. So, it's like the arbitrage of a century, basically.

Well, and he's got 580,000 Bitcoin, and if everybody jumps in and pushes the price of Bitcoin up, he's. Yeah. But he's looking very good, right? Well, I mean, I think there is an effect which is that Strategy is a bit indexed to the MNAV you can hold. So if you have a higher MNAV, you know, if the MNAV is three rather than two, when you sell shares or sell convertible notes, it makes it more accretive in Bitcoin per share, right, per dollar in. And that's partly where MetaPlanet and OPG have an advantage, which they have on high MNAV. And so when they do a corporate action, whichever version is more effective. So it's a little weird because it's kind of, um, sort of self-reinforcing, you know, it has a high NAV, the high NAV helps it keep a high NAV because of the corporate actions. So that, that factor is one thing that makes people skeptical. But you, they do need a fundamental to get it to the high MNAV and, and, and earn it, like justify it. Yeah. And keep it, you know, because they'll, they'll drop and then they'll come back. Yeah. So there is something fundamental there. But anyway, I think it's enormous. And, um, that's the scalability question. And the other one is sort of sustainable, you know, can, can these companies maintain their yield? You know, can they keep doing it or is or is that just going to droop? And, you know, one, um, theory for why it might fall is as they get bigger, you know, if you, if you take something very small, they can create a 50% return. Start with one Bitcoin, you can buy half a Bitcoin, and now they have 50% return in one shot, right? Easy. So now, so that's true, but, you know, once it gets going and it's, you know, it's 100 million versus getting over 100 billion in Sailor's case, they, you know, they have, um, I think their ability to raise is somewhat scalable with their size, right? Because, you know, sort of the debt ratio, right? If they, if they're both targeting a 1.3 debt ratio, you 100 million guys, they can raise 30 million, and 100 billion can raise 30 billion. And Sailor is doing it, you know, he is bringing in larger amounts of money in bigger chunks. Yeah. And, you know, I guess the other question is like, do they start to exhaust the arbitrage players and the bond market, the competition, right? But those markets are very big. Yeah. And they, the, the, uh, the convertibles are extremely attractive for those traders. They're the best, you know, the better upside, the best volatility product on the market for their strategy. So I think ultimately, you know, if, if it starts to become significant in that market, you know, people are looking for yield, they'll reallocate from something else. It's not very interested in the treasuries or fixed economic, right? Yeah. So I think it, that makes it more scalable, but it could, you know, it could cause it to be a bit harder to go big. But there is some advantage being big, which is they get into stock indexes that benefit from passive flows of people making regular savings that get dropped into like an index fund. Right. So I think Sailor is, you know, with MicroStrategy, they're in one of those indexes, but there's another target coming up which, you know, they need a certain number of quarters of profitability and they, and size, and they're getting there, so they may get into it soon.

Well, let's, uh, I mean, like I said, this is the most fascinating thing going right now. I love dissecting new things and new terminologies. Um, let's, uh, let's, let's wrap this up and talk about, um, the potential for risk because inherently this business model relies on leverage to to grow. And of course, leverage is that double-edged sword, especially in a Bitcoin world where it's extremely volatile, both to the upside and the downside. So in order to do good in this strategy, I have to use leverage. And so, um, that's number one. And then some people are naturally always going to take it too far. Number two. And then on top of a volatile asset. So how are you looking at that, the risk side of it?

Yeah, I mean, it's, um, effectively it depends which, which approach they're using. So you can see MicroStrategy, they're quite transparent that they're learning, you know, so they start with one strategy. So when they started, they used their treasury. I mean, firstly, they did a share buyback offer, so that people didn't believe in it could leave, so they bought them back at a premium, most people stayed. They bought their first slug of Bitcoin with cash and then of cash plus or minus rate. And so the next thing they did is talk took a corporate bond. It's a long-running company with a steady revenue, so they, they had a credit ratings to bring in a big corporate bond. They built up a debt ratio, and so they were quite aggressive into their first bear market, and the price fell. They did more, more, more, more, right? And, uh, they actually ended, they overcooked it. So, you know, I look went back and looked at it now. I bought some of it in that bear market period, but I went back and looked at it in terms of, um, how much debt they had versus the asset value of the Bitcoin, and the debt got larger than Bitcoin for five months in a row. So if that was a leveraged position on an exchange, they would have been liquidated, right? So now they, it wasn't, you know, directly margin callable. They had the equity cushion, had plenty of revenue to pay the dividend, I mean, the interest on it. So they just, you know, plowed through it. Uh, they did something tactically interesting, which is they had at the tail end of it, like 200 million collateralized Bitcoin loan from Silvergate. Okay. And Silvergate started to suffer in the market and they needed liquidity fast. So they actually bought back their own debt like a 30% discount from Silvergate. So that worked out well. Yeah. But, uh, generally speaking, I think you can see that they've learned from it, right? Because now they are targeting a conservative leverage ratio, and they also cleaned up the callability, you know, so there's no direct flee on the Bitcoin, right? It's restructured things, and they had, you know, the negotiating power to to do that. Um, so it's in a safer position. And but they're able to do that because of who they are.

But what about all the new entrants that are? Well, that is a very good question. So, you know, that is a potential risk that some new entrants push it too far in like an attempt to catch up or, you know, getting a bit too exuberant and pile on straight debt that then they have difficulty servicing in a bear market where they get too high leverage. Now, some of them, like two of the ones that have a very high net, actually have almost no debt, interestingly. So MetaPlanet has almost no debt, and OPG has debt, but it's Bitcoin basis debt. So the debt, if Bitcoin price falls, the debt shrinks, and so they're not, they never get into a kind of solvency issue with ability to repay, right? So, but yeah, you might, you might see that in a bear market that some people have made some kind of overexuberant straight debt. Yeah. Structures that could, you know. So I think, I think one of the risk points is people looking at the big ones and saying, well, if, if MicroStrategy sold like 500,000 Bitcoin in the market, well, create, I don't think that's happening because, you know, the debt ratio is low, and they got a lot of levers to play with. And a debt, they, a lot of the debt they have is convertible, right? And so they can, you know, they're converting it as it, as it reaches premium. So the debt that's left over when the market terms, presumably will eventually, is, um, you know, is manageable. And I think the other thing is, you know, the average entry price into Bitcoin in this long 65, some probably is gradually creeping up to 70. So they got, they got some headroom from 110 level, right? And, you know, the floor price, this 200-day moving average is also creeping up, 47. Soon enough, it'll be 50. Saying, and if that's an indication of, well, the market probably won't fall below that kind of region, right? You know, there's a safety in that. But, you know, past history doesn't necessarily predict the future also, right? So, and, and, you know, if, if the phenomena gets big, um, you know, it could contribute to the market dynamics in a negative way, I guess. Yeah. Yeah. So, you know, you just hope that the people that that take the cry the risk that goes wrong do it when they're small, so they don't have an impact on the market. Or the other thing that occurs to me is that, you know, a bigger strategy company could buy them, you know, if it makes sense. Yeah.

All right. Last question. Um, where do you see Bitcoin and this Bitcoin treasury strategy sort of, uh, being in five years from now, in in 2030?

Well, I think, you know, because what I was saying about the scalability of the approach, I think eventually it will pull in some of the larger cap companies because, you know, there's a, there is literally a fiduciary obligation to protect the shareholders' interests. And some of these companies are sitting on like a billion dollars plus of cash, or having more, right? 10 billion or something, as billions. Yeah. Right. And so, you know, realistically, with the M2 monetary expansion and the debt ratio in the major economies, um, we're probably facing, you know, a decade or two of financial repression, which means that the, um, the inflation rate is higher than the interest rate. And so, if, you know, if they have 10 billion or more sitting in US Treasuries, they're just straight up losing it, right? And so that's not, you know, I mean, Warren Buffett would say cash is king, and he's just waiting for an opportunity in the market, and he's good at like waiting for the bottom of the market to go buy stuff. But in the meantime, like, why is he losing money on the on the cash? Wait, there's obvious alternatives. So I think, uh, you know, some of the sort of more technology-focused companies with younger management will probably start to get there. You've seen a couple of, uh, shareholder, um, requested, uh, votes for awards with Microsoft and Apple, not, it didn't get passed, but the question is coming in. If, and there are Bitcoiners in there, you know, I know somebody who is, I know some ex-Microsoft people on the in the top management or on the board who are Bitcoiners, right? And so there are people around them that understand Bitcoin, have been at Bitcoin for a while. Yeah. Who would, you know, try to explain it to them. Yeah, for sure. And they don't have to like put all their cash in it, but like, and they see what Strategy is doing, so they're like, "Hey, we, uh, we should probably do something similar." Yeah. Yeah. Um, so I think they, they're missing a trick. And, you know, it's, it's actually kind of surprising how few companies participated in the Treasury Company play in that you could see that Sailor was, you know, trying to lead the dance, right? You know, this kind of dance floor phenomena. One person's dancing. Eventually, everybody joins in. Yeah. And, you know, he's leading it. He's out on a bridge. He's on the mid-voyage of the flight to show it's safe. Yeah. Full conviction. It's contagious. So, I'm like, this is great. Let's, you know, let's see some more. And he's running the conferences, and nobody's copying him. I mean, they're coming. They're coming now, but they, they're starting from the smaller end, like the innovative end. But yeah, I mean, I guess there are some, uh, few public companies doing it. I mean, just during the conference, there was one of the Trump media companies, right, with, uh, convert. Yeah. Yeah. Yeah. I mean, to, to the dance floor analogy, I mean, the one person dances alone for quite a while, and then two. Well, apparently it's now 80, right? So like they're coming. And it, it just takes time. Yeah.

Great. Well, I think that's a good, good chance to cut it off. Um, anything you're working on that you want to draw attention to that people should be checking out?

Uh, yeah, I mean, we're just, uh, doing a, you know, whatever helps to help Bitcoin reach the potential, reach the mission and objective of, you know, involving more people in Bitcoin. Uh, recent pushes into bringing the pension funds and endowments to get them off zero. So I brought Seanville, who had the inside experience of trying to get Bitcoin in there and the outside experience of being a hedge fund manager. Yeah. So trying to help help them do it. Get off zero.

All right. We'll sign off with that. Thanks so much.

Thank you.