Transcription
[Music] Welcome back to the Bitcoin Layer. I'm Nick Batia. Today, we welcome back Matt Dyn. He is the Chief Investment Officer of Build. Dyn, great to be back here.
Thanks, Nick. Now, we always love to hear your big picture thoughts. Dyn is one of those big, big brains out there that helps us think through the long-term changes of the monetary system. That is where we love to focus our discussions. So, he has a great slide deck to walk us through how we are connecting the Genius Act, US dollar stablecoins to Bitcoin, the US embrace of Bitcoin, and of course, the big picture. How is the global monetary system changing? Is it actually going to a Bitcoin-anchored system? Is Bitcoin just part of the mix? How much is gold involved? And how much does this multipolar world affect the analysis? So, Dyn, I will turn it over to you. You can get right into it with the first slide.
Yep. So, last episode we were here in May. I think we nailed gold. That one's going to age very well. I'm not going to talk about gold today, although there are some big things happening there. These will, you know, play out over time, but, you know, just, you know, to put this on the shelf and leave it. Uh, Russia just announced, um, in the last couple of weeks, it's going to begin trading in its gold futures contract later this year, by end of year. Um, and that's kind of your copy-paste of the Shanghai Futures Exchange, which launched in, uh, 2013, 2014 era. So that's the big picture on gold that's going to play out over, you know, the long-term time frame, 5 to 10 years. Um, when we, whenever I come on this show, we talk about the big things going on at the monetary layer, is is the way I view our chats. Uh, so we're going to leave gold aside right now, but there are big things happening there.
Today, I want to focus on what's happening, you know, from the US perspective, starting in Washington D.C. and New York City and working out, um, and, and so in the last, you know, two months since I've been on the show, we've had, you know, three big, uh, line items, uh, to tackle on the legislative agenda, uh, for for Congress, if you will, to to lay the new groundwork infrastructure for what's going to go, how the dollar system is going to perpetuate itself forward. And if you think about right now, Nick, I listened to your podcast, uh, yesterday evening on, uh, what Bitcoin did. You talked about, uh, just the latest developments, and I think you kind of got across a key point where we are right now in the short-term credit cycle, call it like the three to five year. We're at, in my perspective here, uh, when you're, you know, trying to get a sense of where you are on the the sine waves of the the local journey. We're at, in my view, the slowdown point where the Treasury selloff isn't necessarily the biggest risk. It's actually growth and deflation if you're the bond market that you're, uh, super worried about. So when you're at the bottom of the trough, uh, the key things you want to do is make sure that, uh, you're you're going through a risky point on on your path, uh, where, uh, you know, if you let something happen like a deflationary type of event would have qualified as that, uh, COVID, March 2020, that would also qualify. You want to make sure you don't get into those, you know, deep V, uh, uh, breaks where essentially your wagon would hit a rock, break off on the side of the road. You got to pick up all the, uh, all the inventory you were carrying and and come back and, uh, resume your journey. That's extremely expensive. It sets you back. You don't want to see that happen if you're Washington and, and New York City. So, how do you get through that? Well, it it's kind of the telltale signs. Everything we're seeing right now, besides the tariffs. That's a totally different, um, uh, kind of plane. But what you want to see in that standpoint, you want to see a weak dollar. You want to see low oil prices, things like that, uh, to to keep the, uh, the dollar monetary system in in a position where you're set to kind of reflate into growth, is is is what you really want to see. So you want to see a monetary expansion. And, and this is what we get into. What does Bessent actually mean when he says, we want to run it hot? We want to outgrow, uh, we want GDP to outgrow, uh, nominal issuance and and debt outstanding. The problem right now isn't the nominal Treasury issuance, as you, you know, highlighted on that episode you recorded, um, on what Bitcoin did. You'll have like, you know, yeah, a tail every, you know, couple of quarters in something like a 20-year auction, but that's not the key risk right now. It's really, how do we step on the gas? And that's where we get into, you know, the first slide, the dollar infrastructure roadmap. If you're the Trump administration, you have a policy agenda, and these things have to happen in a sequence of events, right? You can't go tackle the next one until you lock in, you know, signed, sealed, and delivered an act, uh, passed by both houses of Congress and signed by the president, then you move on to the next stage. And so what we've seen since Liberation Day, um, the the, uh, Congress and the Senate have been busy as everybody's been watching. Uh, one big beautiful bill act, uh, passed on July 4th. We got Genius through, was it just slightly after that? I, in my point of view, the next thing up, uh, to to get this or to accomplish that key goal that, uh, Scott Bessant, uh, kind of went out and publicly, you know, stated the quiet part out loud, the next piece you need to see for nominal GDP growth to outgrow the Treasury debt issuance, uh, in in my opinion, is GSE reform. Um, and so that's the, that's the key thing I want to focus on. And I've got a, a table here on the bottom left.
Before you get into the table, uh, I want to start because I'm fascinated about your thesis behind GSE reform. It's been something that on the desk everyone was talking about for the last 15 years, yet no momentum. Now, all of a sudden, there's real momentum. I want to unpack that. But first, just back up to the one big beautiful bill. What were your main takeaways? What were the line items that you pulled out of that bill that said to you, nominal GDP is going to rise as a result of this, and maybe even outside of that, what stood out to you from that bill?
Honestly, nothing. Um, it it's it's just a continuation of, got it, you know, raise the debt ceiling, we're going to spend you. We can go through like, where does it go? And I think the key thing is, it's a, priorities were made clear, right? It's defense. Like, defense is top of the list. It's not going to be sacrificed. What does get sacrificed? Social entitlements. Key ones, uh, among them, Medicaid, right? Social Security not touched, Medicare not touched. Um, and which voting block is is going to get hurt the most? Well, it's, uh, the the the the lowest, closest people to living in poverty that the nation state, uh, was supporting. Those were the first ones, uh, to to feel the the cuts, if you will. That that's what I took away. So there is some pre-going to be some pressure from the electorate. But big picture, what the, uh, one big beautiful bill locked in, and we'll get to this in a couple of slides, but it locked in the, um, the Treasury issuance is going to continue for the next 10 years. We raised the debt ceiling to 42 trillion. So there's like, five trillion in room. That what that means, uh, to me is, you're not going to run into a situation where, you know, the the financial sector as intermediates is going to experience a shortage of, uh, of Treasuries, right? Which is kind of your base layer of of the fiat credit bubble, right? So, that's going to continue to to fly in, uh, or like to inject into the system some fuel there. And that means to me, we're going to, we're likely to to traverse through this point in the, uh, short-term credit cycle, you know, the three to five years. If we're at that bottom, this doesn't have to end like a 2008 or 2020. It can be like a 2016 or, you know, a 2012 or, you know, thousands of, or, you know, not thousand, but tens of examples, you know, in the in the post-war environment where the system doesn't have to go into like, uh, a full-on, uh, like healthcare emergency where you have to get out the defibrillator paddles and like, get this thing back to life. That's what I took away from one big beautiful bill. It extends, like we have enough, uh, we will have enough cash in the TGA, all of that, to to, you know, keep this thing humming along at minimum through the midterms, 2026, most likely. It probably, like, given you saw the numbers from June, you you cited those in your, uh, podcast, I I mentioned last night, we ran a surplus. That doesn't mean we're going to run a surplus for, uh, the other 11 out of 12 months, but it's showing that all of this architecture we put in place, you know, the tariffs, including one, the beautiful bill, all of the above, um, we don't necessarily have to be in that, uh, you know, same world we were living in, uh, 2020 to let's say 2024, where it's all just, let's, let's, let's just run up, uh, Treasury spending, uh, uh, inflation reduction act type of approach, Biden, Biden, uh, era policy, Yellen era policies. This is, this is going to be kind of a different state of things, and that's what we'll get into, like, uh, in terms of the objectives. But you, you mentioned, yeah, we've been talking about since about, you know, mid-2010s, what are we going to do with this GSE's problem? Right? When I say GSE, government sponsored entities, what we mean here is is Fanny and Freddy, which have been sitting in conservative conservatorship of the US Treasury, and basically what that was was a result where after 2008, you saw the insolvency, you had an implicit government guarantee of the mortgage-backed securities pools, stuffed with, you know, Fanny and Freddy, uh, essentially insured loans. What does that mean? That that insurance technically, what it means is the US Treasury was on the hook to ensure for timely repayment of principal and interest on these, you know, securities. What does that, what does that, uh, kind of equate to? Well, everybody in America goes and gets a mortgage, right? And the majority of these mortgages are rubber-stamped with, um, that insurance, assuming the the that the mortgage or the loan meets the the criteria that's clearly defined in the credit box. You have to have certain, you know, debt-to-income ratios. You can't exceed, um, LTVs at origination, all of that. But you rubber-stamp that loan with a Fanny Mae, you know, government guarantee, you stuff it into a, a legal entity which pools a bunch of those mortgages and then you securitize. What does what does that mean? You take the capital side of the balance sheet and you create securities, right? You create a senior tranche, a mezz tranche, an equity tranche, and you just stuff those into Wall Street. Well, what happened? We all know this, 2008, um, those loans were not actually money good. The cash flows weren't there, and what had to happen was Treasury had to come in and make good on the put that it technically never sold, right? Uh, if you think about the split between these, uh, GSE, just just mortgages, right? This all started back in like 1935 with FDR's New Deal, but you had a split somewhere in the 60s, 70s where there were actually some of these guarantees that were like hard-signed, like executed by an act of Congress, signed by the, uh, executive branch, etc., where the US Treasury was formally on the hook, right? And that's where you get into this kind of middle ground. There's, you know, FHA, which is a specific department under the, um, executive branch, which is actually underwriting some of these loans, creating and and responsible for these guarantees. And then there's the soft guarantees like Fanny and Freddy. They're kind of like the Fed. They're quasi, you know, public-private institutions. And it wasn't actually specified, hey, you actually have a full guarantee, uh, you know, that that that traces back to like an act of Congress where it committed the purse. We had to do it in 2008, uh, otherwise, like, you know, the US Treasury was just over a barrel. And basically, what, and then you always wonder like, okay, is this what, what, what is the nature of this guarantee? Like, once the, you know, push comes to shove, you know, this the stuff hits the fan, what's going to happen? Treasury had to do it. They had to save the system. But basically, ever since then, and and in the 2010s, the policy has been, all right, we're not going to do this again, right? From the the public standpoint, the Treasury, because it was extremely expensive, the Treasury and the American public got the raw end of the deal, like by far. You can, you can, you know, come up with some analysis, uh, from like Obama administration era and say, hey, the US Treasury didn't lose any money on its bailouts, like of Fanny and Freddy in a nominal sense, and that may actually be true when you line up the accounting, but in terms of the actual cost where it hit, like in terms of the expansion of US Treasury debt that that was required to backstop the system in itself. The cost doesn't necessarily show up like in the actual net income statement, uh, when you're looking at, hey, what did, what did the US Treasury come in at to inject capital and take Fanny Freddy into conservative conservatorship? What is it going to exit them at when it reprivatizes? The actual cost is in the the nominal debt expansion itself and the inflation wave that that we hit, in my opinion, over the last like five to seven years, that that's that's been developing. So that's where we find ourselves today. And this new administration, I would say, is the first one where this is actually like a clear policy agenda item, whereas it's not, you know, a toy discussion anymore. We're not kicking the can around. This needs to happen. I'll get into into the why. Like, functionally, we can't accomplish, uh, Treasury Secretary Ben stated objectives without doing this, um, and that's where I see this coming in.
So, that brings us to the Bill Py tweet of, uh, it was June 25th, right? And in Bitcoin, if you follow your chat groups, this wasn't like, this was raised like, uh, as as an item that's garnered attention. I don't know if it rose to a level of awareness that, uh, the the current hot topic, like Bitcoin treasury companies, is is, uh, getting in our discussion. But in my view, we're, you know, coming on this show, you know, basically quarterly, and we talk about what are the big developments at the monetary layer. This is the big one that's lurking under the surface that really, in my opinion, anchors Bitcoin to, uh, the the propagation of the existing, uh, credit system, in the credit money framework.
So, just, just a couple more points. I don't want to belabor this slide too much, but, uh, Bill Py's tweet said, "All right, it's going to apply to crypto broadly, uh, where a borrower coming in for a, uh, like a GSC kind of sponsored or supported loan where it's got that insurance guarantee, they'll take your crypto holdings into account for qualification, right?" What does that mean? Crypto? All right, throw all your other E-salon on there. Sure, they'll market to market. But I think, uh, uh, the average listener of the Bitcoin Layer has come to the conclusion that it's actually Bitcoin that matters. It's not all that other stuff. Um, so, and it's also, you know, over time, you see all right, these measures, Bitcoin dominance, whatever the value, the market cap flows towards the, the Bitcoin gravity well, and ultimately that boils down to, there's only one solution to the, the Byzantine general problem. So that's step one. Um, Bill PY, uh, current director of, uh, the FHA. He's, you know, a legacy. He comes from a family that's been involved in the housing and construction lending industry. So he's from the sector. That's basically a recognition that, um, the entire industry, housing, mortgage lending, etc., they're on the Bitcoin rails right now. So we've locked in that anchor. Now, is it pure like, uh, a plan policy like clearly outlined trajectory? Maybe. Maybe there is a long-term, you know, roadmap that's going to be executed on for the next three, five, seven years. It could also just be they're responding to market incentives and guided by the visible, uh, invisible hand. Right? So, what I mean by that, you Bill PY himself may not be orange-pilled and a card-carrying member of the Bitcoin tribe, right? Same thing, I think Scott Bessant gets Bitcoin, like he, I would be surprised if he doesn't own a bag himself. But, uh, even if you're in the mortgage industry, you're at Fanny Freddy, you're in these, you know, they have a really nice, uh, building, you'll see it if you ever land in in D.C. and you drive into, you know, the, from, from Reagan Airport into the Beltway, you'll see the Fanny May, um, headquarters. Maybe those executives there aren't all kind of in line and baked into what's happening, but the market incentives are guiding them to this destination, and they've already plugged into the the Bitcoin anchor. In my point of view, and I'll, I'll get into that. The era of institutional Bitcoin adoption is fully upon us. With ETFs and new corporate treasury models, gaining exposure has never been easier. But this creates the powerful temptation to hand your keys over to somebody else, which might be the exact opposite of what you wanted to do with Bitcoin in the first place. Having the control of Bitcoin private keys has never been more important, but there is always the risk of self-custody. So, how do you battle that? You do it with Unchained. Explore the full suite of tools today at unchained.com/tbl. unchained.com/tbl. Human Rights Foundation presents the Financial Freedom Report. Go to financialfreedomreport.org, sign up for the free newsletter today and get involved in the freedom aspect of Bitcoin. Bitcoin is a human right and it is evolving as such. Make sure to go to financialfreedomreport.org, org. Sign up for their free newsletter and learn all about how Bitcoin is at the cutting edge of providing people with human rights. Smart macro analysts don't just watch the Fed, they watch the world.
Okay. So, I want to then just get you to focus the conversation on how GSE reform happens. What happens? Is it a sale? And is that what just brings money directly into the government, or is there an economic process that you're referring to that can increase nominal GDP? Just break it down for us. How does GSE reform lead to the GDP growth outstripping the debt growth?
Yep. So these things are in conservative conservatorship, as we mentioned. Tough word, I'm tripping over. Um, need to drink more coffee today. What that means in effect, so all of the cash flows from these, um, you know, mortgage underwritings and insurance, you know, they've been flowing into the Treasury and they've been helping, uh, on the net income line, kind of pad the Treasury's results, right? It's not, it's not causing any meaningful dent, right? We, we've all seen the Treasury's fiscal situation and the deterioration that's taken place over the last 10 years. But what would effectively happen now as you try to reprivatize, and what does that mean? It's you give the private equity owner, the private owners, I don't want to say private equity, that's different, not happening here, the private owners of the equity in these entities, Fanny and Freddy, they would, uh, be allowed to essentially run the companies as they see fit for the for their own, you know, highest and best profitable use. What does that mean? Well, you would actually have to kick in capital from the private markets. They would effectively buy these back from the Treasury. And on this is bottom left, still on the first slide. This is where you just get some general estimates. This came from TD Securities on a, on a, um, IB chat on Bloomberg. I got just some sell-side research, uh, probably about a month ago, as this discussion was really, uh, getting underway, what that would amount to. It's probably going to be something in the ballpark of half a trillion dollars, like $500 billion capital injection that the US Treasury is going to get upfront, uh, from the GSE equity value. And then there's certain things that would, um, come into play in terms of kind of balance sheet retention, uh, on these entities themselves, on their ability to grow their, uh, equity capital buffer, which would then allow them to go out and make increase mortgage originations. And what does that mean? That that's where the rubber hits the road between, um, you, you've got kind of three players in the, in the domestic credit system, right? You got the federal government, you've got the financial intermediate intermediaries, and then you've got the private sector, households and businesses. But really, let's focus here on households. Where do they borrow? It's for homes, right? That's your biggest line item, uh, of borrowing. Everything else kind of pales in comparison, uh, in terms of market size and just the balance sheet capacity of of your individual American consumer. Your home mortgage is going to be the largest loan you, you typically take, uh, on in your entire lifetime if you're, uh, a working-class American. So, that's, that's really what we're looking for, like the policy steps to get there. But the the output you're looking to achieve is, uh, like private sector borrowing. We need to get them to to lever up, right? If you want to actually run it hot, as Scott Besset mentioned.
So, let's, let's skip that slide I have on, uh, what happened with Genius and the, and the money. We might, we might tail that at the very end. But if, slide three, what we locked in essentially, we committed with one big beautiful bill, and this is from the January 2025 CBO estimate. So the next, you know, six-month iteration will fully bake in what, uh, Obama locked us into. But basically, the numbers stand, uh, over the next 10 years, you're going to see the US Treasury issue an incremental $23.9 trillion, call it $24 trillion in Treasury debt. That's going to go into this, uh, credit system that, you know, we've talked so much about. And then to support that Treasury debt, CBO sees that we need to increase GDP by about $15 trillion, nominally, right?
And if you go to slide four, this is the way the, uh, the intersection of a fiat money and credit money, uh, system works. To get that GDP growth, you have to have, uh, credit expansion in the system, right? It's one for one. It's monetary creation. And if you just look at the Fed's Z1, uh, quarterly statements, the financial accounts of the United States, where it just breaks down all the credit, uh, in the domestic system, uh, this doesn't count the offshore dollar credit. And then you look at the, uh, uh, BEA's, uh, GDP numbers, and then you, you zoom out and you look at these things over long-term time frames, 10 years, 20 years, you get a very good, uh, uh, kind of sense of all right, if the input to creating more GDP, make that number go up, uh, is going to be credit creation, how much credit expansion does it take to generate a nominal amount of GDP? And that's where you, it's very clear. Um, everybody who's kind of into Bitcoin knows this about the, the legacy system, that really got started, and we talk about the Bretton Woods, you know, post-World War II order established, in the aftermath of the war, really got underway on that fiat and credit dollar. I think in my mind, the the acts of Congress started to show up very heavily in the 1960s. You had a couple from, um, as as early as, uh, JFK. It was the Silver Certificate Act of 1968 that really, that in my mind, really broke the link in the domestic system between a commodity money, the silver dollar, and, uh, fiat credit money. Um, and to, you know, bring that into the Genius Act, what we're seeing today, I think that the Genius Act represents, kind of the starting point of a new wave in, uh, base layer, kind of legislation, implementation of the next iteration of the dollar. But the fact still stands. If you're looking at the continuity of the existing system, you have to find a way to grow credit by essentially $64 trillion in the domestic economy. Um, and this is from just American banks, non-bank lending, etc., you know, private credit, that whole thing. To get that $15 trillion in GDP increase, call it $16 trillion, somewhere in that ballpark, we're going to have to get a credit expansion in the next 10 years of $64 trillion just to keep this thing running, uh, under a steady state. And that's where you get into, like, the clock starts now. Like, it, it's already started. Uh, we've, we've committed to the Treasury borrowing to get the GDP, uh, growth out of that credit expansion. Like, it comes with a tail. There's a lag. So this is where the, kind of the sense of urgency to get moving. Um, it, it's already underway. So my, you know, just kind of analysis of the system as it's designed, it needs $64 trillion, uh, incremental credit expansion. We know from one big beautiful bill, Treasury is going to do about $24 trillion of it. And that's just to fund the, the needs that the nation state has signed up for, right? It's defense, um, entitlements, social security, um, Medicare, uh, the big ones, uh, interest expense is on the list, and, and then any any discretionary spending left, kind of left after those things. But, uh, the $24 trillion is what the the federal government needs to kind of keep making its its own commitments, you know, money good on its existing, uh, liabilities. We need to see $40 trillion come from somewhere else. And that where is that somewhere else? It's the private sector. It's the real economy, uh, in the United States. So how do you do that? There's no way to accomplish this goal without, uh, you could say you can rely on, uh, businesses, right? And you've already kind of seen that, like businesses can grow at, uh, you know, kind of the run rates, uh, they've been, you know, experiencing, you know, post-2008, businesses haven't been the problem. It's the reflation of the household's, uh, borrowing capacity. That is where you're going to actually have to get your, uh, your bang for the buck to make good on what, uh, one big beautiful bill act, uh, really just committed to. But that, it's, it's really just a sequence of of, um, the same commitments, the same, just run it back, that's been going on for 50 years at this point.
Okay. So, I have a few questions. We're going to, we can, we're going to need $40 trillion in private sector credit creation. Obviously, to any loan, there are two sides. There's the borrower and the lender. So we need the p private sector borrower to lever up, but we also need the private sector lender to show up. Okay. My question is, how do we, how do we do this? Where is the will to lend going to come from? Where is the will to borrow going to come from? And let me just layer in, you know, a theme from Bitcoin age is the outpacing of the median home price to the median income. So if that ratio is getting out of hand, how does the private sector agree to lend to the borrower that wants to lever up? Does everybody in the United States just have to move to the next house to get that leverage going? If you can walk us through your vision here to how we get that $40 trillion to start showing up. And remember, guys, it's a double-entry system. So it means the entire system grows. The assets of banks grow because you're going to pay them back in the future. The liabilities of the private sector grow because they owe the debt. So, walk us through it.
I'll give the shortcut so people cut to the chase right away. The answer is Bitcoin. Surprising, right? Uh, but it, it's buried. The lead is buried in that Bill Py tweet. We're going to take your your crypto collateral into account. I'll, I'll go into the demographics where Gen Z is. Gen Z is your market leader, or is the leader here. They're the demand side. The capital has to come from somewhere, right? As you said, the liabilities have to balance. You can't just lever up new credit creation on no equity layer. If you do that, you get a repeat of what we tried to do in the 2000s, which ends in a in a bust. And so we're not going to repeat the experience of everything we've seen since the 2000s, 2008, and the, uh, kind of the dead end that that led to in the 2010s. The difference this time around is we have a mature, um, capital pool that exists in Bitcoin and is and is where the growth is and it's where the adoption is on the young end, the youth of the demographics, uh, uh, bell curve, uh, that tells you where this is going. So you mentioned, where does the capital come from? Is it going to be, you, you go through the checklist, right? You got to get, you got to get capital somewhere. Is it going to be the domestic banking system? Well, we've got really good data, uh, from the Fed on the U H.8 report. We talked about Z1, right? H8 goes through the, um, balance sheet composition of your domestic, uh, regulated banking system, uh, by, uh, asset type on loans and then liabilities, uh, on the capital side of the balance sheet. Now, you look at from the asset side, right? Where are, where are the banks able to grow like residential real estate lending? That's growing over the last three years, and this is with interest rates rising. Um, so now you're originating, uh, like a 30-year, uh, Fanny Mae conformant, uh, MBS at like high sixes, right? What's your, what's your bankrate.com kind of measure of the 30-year mortgage rate? It's like six and a half to seven, and it's been, it's been up there, uh, for basically the entirety of the post-2022, uh, world in in fixed income markets. So even at those higher rates, you're only seeing banks expand their asset side exposure to residential real estate loans at about like 2.5% annualized growth, right? And if you're only growing the nominal, like that nominal amount of credit at two and a half percent, that's not above the growth rate in the debt, right? The, the actual debt stack is growing something closer like a seven to nine. So what, what we're seeing, and this is like plainly clear in the data. The banking system alone isn't capitalized, uh, well enough to do it. You, and, and then you get into like private, uh, uh, mortgage originators. Generally, they'll have higher rates. They also may not have the balance sheet, uh, capacity, like the equity layer, uh, to to lend into. They're also going to be regulated like residential real estate, uh, lending. You got to, you, uh, have to meet, or you're going to be covered by, uh, consumer finance protection bureaus, state licensing requirements, all of that. And so those can't necessarily get it done either. We'll get into this, but you're seeing, um, the mortgage-backed security pools, the, the TBAs, as they're called, to be announced. Those nominally aren't growing. So, we've got, uh, a problem here for the, for the residential home borrower. There's clearly demand, right? Gen Z wants a house. There's a lot of millennials at the tail end who still don't have a house. They clearly want to get into a house. They get them into the loan, right? It's like showing up on a car lot, get them into the car, same thing. Get them into the house. The, the problem is it's both, uh, qualification. Do they have the assets? Do they have, uh, the income? Do they have steady employment to to qualify from the underwriting side? And then is there the supply of capital to to make that happen? Those two ingredients are what is missing, and that's the core problem, uh, that the the domestic financial system needs to solve in my, uh, kind of framework, in the next two to three years to actually make good on what, uh, Scott Besson has made, kind of official Treasury policy. We're going to run it hot. Um, and so where does that come from?
If you go to slide five, we're in a secular rising rate environment. This isn't 1980 to 2020 anymore, in my opinion. We're at, you know, higher highs and higher lows on, kind of the level of interest rates. And that said, I know right now, the the in the in the short term on that kind of secular path that's going to play out in in my kind of crystal ball, hazy as it is, over, you know, the next 5, 10, potentially 20 years, like that type of long term. We, we are right now, in my opinion, in that kind of downturn of the trough where rates want to, uh, come back in. Rates blowing out on the upside isn't your highest and most urgent kind of concern if you're in Washington D.C. and New York right now. The the bigger concern is don't fall into the deflationary trap at this point in the journey. You need to, you need to actually facilitate and like catalyze monetary expansion. So, in a rising rate environment, refinancing activity dries up. And that's the line in light blue, or the bars in light blue. What a refinance is, is, hey, you've got a mortgage at, uh, 5% that you took out in 2016. 2020 comes around, Fed's going to do what it does, cut rates to zero, tons of CARES Act spending, money slashing around out there. Oh yeah, we're going to do a lot of QE, right? And a big part of the QE wasn't just Treasury debt. It was, um, Soma purchases of these, uh, mortgage pools, right? Uh, if you look at the share of the markets, they were gobbling up like 70, 80% of mortgage-backed securities. And this gets into the the balance sheet runoff of of QT. It's really hitting, uh, the non-reinvestment of those MBS, uh, principal maturities and interest payments as well. But you see in the blue line, it's very clear that that era, that era of refinance originations, just pure like existing borrowers, just getting a new loan, pay off their old loan, uh, at at a lower rate, that's drying up. And, uh, kind of that makes sense, right? If interest rates want to secularly move up, you're not riding the primary trend down. You're only going to get secondary cycles of of booms where, hey, the people who originated in the last three to five years, maybe they can save, you know, shave a couple of points off their off their rate, but that's not going to be as dependable as it was in that 40-year bond bull market of like 1980 to 2020. It's going to be, uh, uh, like a role player. What's going to have to drive your growth is actually those black bars, the purchase origination. So, new home purchases, brand, you know, brand new, uh, primary primary residence loans. And you see, you know, the trend there. It's, it's still, um, you know, lower highs in 2020, 21. We're not at the peak that we were able to kind of generate in the early 2000s, which was, you know, in in my point of view, entirely monetary driven. You know, post-2001, we cut, uh, short-term interest rates to two. And the economic policy, kind of was to essentially just use interest rates as your lever, uh, to, you know, push, uh, residential, uh, mortgage purchases, just moving up and to the right. We know where that kind of ends. If you don't actually have, if it's artificial, just kind of rates driven growth by itself, there's only so much that can do. And if you leave it to the animal spirits on on Wall Street, right, they will milk everything they can out of it. And that ended in a complete disaster. So, if what you're looking at right now, if you're, uh, Washington D.C., you're looking to, uh, reprivatize these GSEs, you want to do it in such a way that, uh, kind of aligns the economic interest so you don't get the same result where all right, it's a bunch of mortgages that home buyers couldn't afford. You, you really want to make this a lasting solution and durable, um, I think would be a better word for that, like durable economics works for both the supply of capital and the borrower of said capital, capital put the American homeowner like into a loan they can actually afford. Um, and I think that's how, like, we have one shot essentially to get this right. So that's kind of the roadmap. I think the next stage here, uh, for the the Trump administration. I really walked into that one when I said, how do we do it? And it's Bitcoin.
So, I do want you to, uh, get in a little bit more into how young people can use their Bitcoin to help nominal GDP grow through basically these black bars going higher as they present good collateral to the banking system. But I want to talk about private credit real quick. The privatization of Fanny and Freddy. If we get privatization of GSE, then the mortgage origination will be done in the private sector. Do you argue that that would increase rates or lower rates? Uh, it that would obviously depend on the size of the equity tranche that is brought into the funding of new origination. So, if the equity tranche is very large, that means there's good protection for the lenders against first losses, for example, that could that could increase origination, lower rates as supply goes up. But my question is also on the private credit front, maybe you can give the viewer and the listener an update to how that whole industry is evolving. Is it going? You mentioned the H8. So, what you're seeing is a 2.5% annual growth rate of bank traditional bank lending. That's not going to cut it. That's not even higher than home price appreciation across the United States. Yep. On an annual growth rate. So, I'll turn it over to you.
Yeah. So private credit, when we hear that term, you see it written on the front page of the Wall Street Journal, those stories. What that is focused on right now is, you know, your your big names, Apollo, Ares, you know, those type of of of firms, they're focused on the the middle market of corporate borrowers, like legacy today, so like direct lending deals where you don't necessarily need an investment bank or, um, the dollars are coming from hard equity dollars, not balance sheet expansion through like the FDIC insured system. That's all.
Let me just, I just, let me pause you for one second because I want to give people a little bit of a parallel there. I'm sorry to interrupt, Dyn. But when I talk about Bitcoin growing and the demand, the marginal demand for Bitcoin growing due to credit expansion, this is actually what we're talking about. Some of it is hard equity current dollars that already exist. Some of it will be new credit creation via the banking system, basically taking on some new bonds onto its balance sheet as the hard equity dollars go and buy the rest of the bonds. So, at the margin, as Bitcoin, as the capital for Bitcoin comes into Bitcoin from the dollar system, some of it will be existing dollars and some of it will be new credit. And so that's the difference here when Dyn is talking about hard equity funding a bank, a mid-level corporation borrowing in the market, that means there's no credit creation, there's no credit expansion in that process. So, sorry to.
Well, actually, it is. They're levered. A private or a private credit lender is levered about two to one. They're they're 50% debt to assets typically, and the debt will come from, it could be like a, uh, a bank lender. Often, you'll see, you'll see if you follow the headlines, there's partnerships, like certain banks, of, you know, large regionals all the way up to the big five will partner with certain, um, you know, private credit shops, like the big names, the gold-plated names, and they'll lend into them. But it's, it's, it's a lower level of of leverage than the existing, uh, FDIC regulated banking system, which is levered like 10 to one, debt to debt to equity, right? So, it's much more constrained to lend into risk, uh, if you will. And that's kind of the whole environment here. The the the big picture is we're at a point in the cycle where the credit creation that's funding the economic growth, we've saturated it starting in 1980 up to 2020. It's like we've, you know, there's diminishing returns. That's going back to that scatter plot chart, change in credit in the system on the X axis, GDP on the Y. You can see we're not breaking even. You don't get one for one, or even anywhere close. The banks don't want to lend into that risk. And so what they'll do is they'll sign up a, um, like an intermediate, uh, a private credit shop to actually be on the hook for the equity layer of say, a risk loan into a mid-market corporate, you know, a domestic American producer. And then, or, or you may see on the debt side as well from the private credit, some of them can issue bonds, and these will be like the highest spread bonds in the, uh, Bloomberg Investment Grade Index. So you can kind of see where the risk is, but it's actually apples to apples, kind of a lower risk way to, um, to fund that economic activity than just funding it through the bank's balance sheet alone, which the banks are hesitant to do in this environment. And also the regulators don't want to see them do it either because, you know, Treasury at the end of the day doesn't want the public to be on the hook for the cost of a cleanup if it if it materializes.
So, where does the capital come from? Typically for for for mortgages and housing. So typically, and this is slide six, the the hard dollars to fund say a Fanny or Freddy conformant loan, it's actually going to come from the investment grade, uh, debt markets. So I break this down. So I've got orange, everything in like a creamsicle orange. Uh, I've grouped. What I want to focus on is the light blue. The light blue is your mortgage-backed securities, your your pass-throughs, if you will, um, that are, you know, stamped with that Fanny or Freddy guarantee. Those bonds, which are ultimately a claim on those mortgage assets, and they're ranked in terms of seniority, who gets the cash flows first, all of that. It's actually your bond funds. Like, this is your investment grade credit. This is the stuff pensions can buy. This is the 40, and your 60/40. And this is where your dollar capital goes, uh, to to funding, uh, kind of the the private sector household mortgages. So, for for context here, the blue line peaked in 2008, and since then, we've seen a shrinkage in the share of, you know, per dollar of the investment grade credit stack. Mortgage-backed securities have lost 19 cents of every dollar. Like, you've declined from about 45 cents down to 27 cents, about there. Where has that gone? Well, it's actually been the public debt, the US Treasuries, that have had to pick up the slack to keep this credit expansion going. Otherwise, if the credit expansion doesn't continue, GDP contracts. So, it's actually been the Treasury who's had to pick up the slack. They've had to grow their market share. And you've seen 23 cents of every dollar, uh, like increase in share since 2008 on Treasuries. So, we need to find a way to get this to rebalance. And, you know, part of it is it really comes down to demand side, right? The supply is going to be there. We're going to find the balance sheet capacity from, you know, pensions, endowments, etc. The 40 is going to anchor to the top line of the 60/40. I'm just, you, using 60/40 here because like that's what the entire thing, uh, averages out to for institutional investors, retail investors. You own, uh, uh, equity, alternative assets, commodities, whatever. And then you're going to own a piece of bonds. That top line expansion, you know, you, your equities grow at a faster rate than bonds. Bitcoin grows at a faster rate than bonds, all of that. But, but your your credit, uh, stack can kind of proxy to that top line. And so what you need to unlock to get this go going is
To kind of reflate the uh the the dollars in that credit stack that are ultimately finding their way into residential mortgages. And there's you mentioned this earlier you can't like what won't work is to have it come out of price, right? If you keep incre like you can get you can get a nominal number through price or quantity, right? That's how you arrive there. If you get the growth through price, what does that uh equate to? Housing price inflation, right? That'll kill your affordability, uh qualification becomes harder, you need more income to service that debt, and you'll see, and we'll get to this, stagnation where you stop getting young people into homes.
Whether this is good policy or bad, we'll leave that discussion aside. It just all right. Get people shelter. It's a key, key need on Maslow's hierarchy. I I'd say, yeah, it's a good, it's a good thing to pursue. But if you do it through price alone, you're running up into the constraint where, um, young Americans can't afford the house, and then you have social unrest, all of that stuff. So, it's got to come through quantity, and in my mind.
So, how do you do that? You've got to find a way. This this is uh slide seven. Uh, if you track the the the line over time since 1980, and we really started this this big picture, um, uh, kind of, uh, cyclical credit boom, that that bond bull market of 1980 to 2020, that has slowed down. This is on log scale on the amount of, um, uh, mortgage-backed securities outstanding that go into that, uh, dollar credit, investment grade, you know, credit stack. We've kind of stagnated what can be accomplished with the legacy system alone. And so we need to find a way to invigorate, uh, and step on the gas.
And this is where you get into the Bill Py tweet. Crypto is the policy, but in reality, it's Bitcoin is the policy. We're already there. We've we've made the quiet part out loud. Um, but the order from the head of the FHA is in. We're going to focus on qualifying new borrowers for these mortgages on their crypto holdings, which means Bitcoin in the long run because that's where all the value accrues. And then from there, you start to realize, and this is what I've come through with my experience focusing on on Bitcoin lending, dollar credit into the Bitcoin collateral layer. That is your entry discussion for a supplier of capital to come to the realization, hey, this credit is actually better. Like, I actually like this Bitcoin as a collateral layer. All the features. Won't go into them, but that gets the, uh, light bulb to go off, uh, for a large set of capital providers, uh, to really see Bitcoin and what's going on. Then they get the understanding, oh wait, this isn't tulips. There's actually something going on here with Bitcoin as money. And then that leads to further adoption. And, uh, you know, you just keep going. Where does this rabbit hole go?
Once these GSEs realize, once the dollar capital providers realize, oh wait, I get a better collateral, I can actually underwrite this, uh, Gen Z or millennial American worker. Uh, get them into the mortgage. Uh, I qualify them with their crypto holdings. What's my next step here? Oh, I may ask them to do a dual collateralized loan, something like what you see Battery doing in the commercial lending space. Say, "Oh, you can only, you only have, let's say, $20,000, $30,000 in Bitcoin holdings right now behind your name, um, uh, to put as the equity layer to qualify for this loan. What if you collateralize some of the loan with your existing Bitcoin holdings? I can get you in the median house, $250K, $300K, etc. I can I can underwrite that." And then you start working on what's the next step? Oh, I actually want some of the Bitcoin myself. So, oh, some of that, you know, monthly payment of principal and interest, that's going to go to into a share pool of Bitcoin. And that's where you start getting, all right, what we're trying to do here with Bit Bonds, like Bitcoin-backed treasury bonds, that's a hard sell. We're working the, uh, square peg into the round hole, if you will.
But if you start, you just follow it through. You, what we need to see happen is we need to get 50 million more Gen Z and millennial home borrowers to take out a mortgage. We've already said the quiet part out loud. You know where the millennial is saving. We'll get into the charts here with the Gemini report, but we've told them with the Bill Py tweet. We want you to save in the cryp. You're already saving in the crypto, right? That's where it is. And crypto is Bitcoin. You're already saving in Bitcoin. That's the fastest horse, uh, for growing equity on your balance sheet, right? That's growing at 30, 40, 50% annualized with volatility, but we know that that gets they've already been incentivized. Okay, you're going to hold Bitcoin. Now, you're going to, uh, actually lend into, um, uh, the the the the youth on your demographic bell curve. Meet them where they are. And then eventually the suppliers of the dollar capital, um, are are going to come in. And this is this is where those two ends meet in my opinion, is, uh, is the, uh, the the GSE loans and the and the reform is the first step. Uh, the when I say reform, I mean the reprivatization, that's the first step on, uh, laying the infrastructure to make this happen. This is going to be something that takes three years, five years, seven years. This doesn't happen overnight, but the seeds are already there. And in my mind, uh, just following the space ever since, like as long as you have, right, the the endgame and what people are coming to realize is it's it's a Bitcoin story now.
Talk us through the the slides eight and nine. Uh, 34 billion Gen Z Americans own Bitcoin and tw 12 million own a home. So, how does this contribute to this, uh, uptick in private credit growth that we want, or I should say in private sector credit growth to counterbalance this, uh, huge wave of increase in public borrowing that we've had? You mentioned 64 trillion that's needed. 24 trillion will come from the Treasury. That takes total US debt up to about $60 trillion. Uh, but we also need another 60 tr another 40 trillion of credit creation. Um, so obviously Gen Z's buying homes using Bitcoin as collateral can contribute to some of that. Maybe how much of that is untapped right now versus what you could see over the next few years and walk us through some of these numbers.
Yep. So starting on slide eight, estimated 34 million Gen Z own crypto Americans. How do you get that number? Well, left-hand side, uh, you got the the demographics chart, um, spray chart, age, uh, and then male, female, male, female, let's not worry about that here. The key thing is about 20%, so 19.7 roughly of the US population is Gen Z born. I think the dates, the cut-off dates are 1997 to 2015. All the Gen Z Americans who will exist, I mean excluding, uh, immigration, different discussion, won't address that here, they already exist, right? A Gemini report published, um, uh, this was recent, this was like June, and they've they've updated this number over time to track kind of, uh, where is, uh, Bitcoin adoption on that S-curve. They say right now, per their own analysis, is 51% of Gen Zers, uh, acknowledge owning crypto, right? And sure, some of that is going to be, they're going to own the the the garbage, right? They'll some of them are trading in Pepe, NFTs, all of that stuff. The m the majority of the value though, it's it's Bitcoin. Like that's where the lasting value is. So, use that as a proxy. 34 million, uh, Americans, I would say in this Gen Z cohort, have already chosen, they're they're adopting, like they see this, and this is this is where kind of monetary adoption is actually working its way up. Um, so those 34 million Americans, they tell you where the future is, right, where things are going to be in 10 years. Um, my grandparents, you know, who are of the Silent Generation, they're they're end of life, they're dying. Um, I just lost a grandmother earlier this this year who had never actually signed on the internet once in her life, right? So, the only people who met that meet that description are kind of your your people who are just naturally aging out because we have finite lifespans, right? But where the future is, where where capital and where where savings is going to take place in the future, Gen Z is, you know, that cohort and latestage millennials as well. They tell you where this is going to be, right? So, they're already saving in Bitcoin. And when you see this Bill Py tweet that you you can't push the free market where it doesn't want to go organically, in in my opinion, like you have to meet them where they are. So the youth are going, like they've opted in, they're choosing Bitcoin as their money. And so these legacy institutions that have existed for nearly a hundred years now, the GSEs that were enacted in, you know, Great Depression era to persist into the future, they have to meet, you know, the current generations and future generations of Americans where they are. So this is that bridge of like two monies coming together. If you can do this successfully, right, the monetary system of the nation-state transitions forward into the future, you're going to see a debasement of the legacy, like IOU's. That's going to happen, and it is happening, but you may not see a total collapse, right? The dollar persists, it carries forward. Um, and so, yeah, part of that too of keeping your your youth engaged and bought into this, uh, system that's been inherited, you have to keep delivering kind of what your next generation expects or thinks is promised. Like what is it, what does the youth want the want the system, uh, to to do for for themselves, right? And this is a discussion you're seeing, like you're seeing this play out in society in real time, right? You saw, um, a socialist, uh, candidate win the, um, uh, the Democratic nomination for New York City mayor, right? So, the youth are really, um, telling you where the kind of the battle lines are and how this is going to play out. If you want the legacy framework to, uh, kind of continue operating as is, um, you know, these institutions won't exist if they're not, uh, accomplishing the output that that, you know, they're desired to have, otherwise there's no reason for them to to exist. And this is where you see, uh, kind of the hallmarks of the American dream, right? What does that vague concept mean? To a large degree, owning your own home. Uh, it, it has been a, a kind of core part of of that deal, if you will. Uh, you could say like since, you know, the the pilgrims landed on Plymouth Rock, right? But but especially in the post-New Deal, uh, uh, kind of engagement between the the federal government and the and the citizen. So the young American has chosen Bitcoin as their money, like that is where adoption is happening, yet they can't qualify from the legacy system, uh, to to to own the home. So 34 million kind of proxy own Bitcoin, tw, and that just means to any minimal exposure. Doesn't mean hard key, like they own a cold card, they hold the private keys, they control the UTXOs directly on the blockchain, but they have exposure, right? They have a Coinbase account, a Gemini account, etc. Or they're long, uh, a Bitcoin ETF in a brokerage, uh, something like that. Just include it, wrap wrap all up in one, uh, Gen Z owning crypto, right?
12 million, uh, Gen Z Americans, this is slide nine, actually own their home. And this is where we've seen stagnation. This is according to a Redfin, uh, research report that came out in, uh, May. You have seen since 2022, you've basically seen a flatlining in home ownership, uh, uh, penetration for Gen Z, especially. They're they're essentially stuck at about 26%. So to get this thing, uh, am I say this thing, the credit system, uh, the Scott Bessent goals, you need nominal GDP to outgrow Treasury debt outstanding to get the Gen Z American into a home, give them the keys, all of that. All of them are aligned, uh, all the economic incentives are aligned. Uh, you just need that base layer to make it happen, which has already been announced, right? It's It's going to be Bitcoin is is kind of the first step. Once the toes in, once that Bill Py tweet, uh, uh, was published in in late June, June 25th of this year, in my mind, that's already kickstarted this process for, uh, for the GSEs, for the reformation to take those, uh, kind of legacy systems, that credit origination architecture, and port it onto this, uh, new age, the Bitcoin age.
Now, leave it to Dyn to associate Plymouth Rock with continental bills and Bitcoin changing the monetary system, but he's the only one that can do it for us. So, Dyn, why don't you take us out, talk to us about slide 10 here and your closing message on this vision as we transition from a dollar-based credit system to a dollar-based credit system with Bitcoin collateral. And I can't imagine somebody watching this episode and coming away thinking that Bitcoin is replacing the dollar system over the next 5 to 10 years. That's the opposite of the conclusion here. It's that for the dollar system to persist, it needs to start introducing Bitcoin rail. So, I'll turn it over to you.
Yep. We skipped a slide here on this, uh, this really awesome book. I think it's kind of one of a kind, uh, in the, you know, recent modern era of, uh, just commentary on monetary history of the United States. But there's a book called Pieces of Eight by Edwin Vera, which basically traces through, uh, the the dollar infrastructure, not just from the continental, right, the the script paper that the revolution was, uh, funded with, but all the way back into English common law. But you get into a point, um, where he mentions, this is very early on in the book, page 14, the fate of paper IOU's that fail to persist themselves across across generations. This little snippet highlighted to me, this is the risk, right? If all of this, uh, fiat credit, um, you know, if we don't find a way to carry it forward, what happens? Well, the continental tells you, like a good case study. Eventually, these IOU's, they get handed off through the real economy. You know, Paul pays Peter, there's a trade, uh, of goods or services for the money. They take a discount, right? And that's literally what we've been kind of stickered with this concept of inflation. It's actually, we think about it as a loss of purchasing power that follows the monetary expansion. But what happens as those IOU's trade hands, they get discounted. And when I say that, I mean they lose purchasing power with each economic hop, right? And what ends up happening is those IOU's eventually they fail. Like it becomes harder and harder to find another taker to give you a real good or service for that script. And the the end fate is those IOU's eventually just they quietly die in the hands of their possessors, right? They die in and an estate as this natural, like our finite lives play out.
So, bringing that example back to my grandma, um, you know, she may have been saving and and following, uh, kind of common practice advice, bet your age in bonds or own your age in bonds, right? 60/40, you know, that average 60% equity, 40% bonds. Well, if you're 90, you should own 90% bonds. What that actually leads to is those those 90% bonds, they don't buy purchasing power like the actual economic producers. It's always the youth of society, uh, who's actually able, uh, to to go out and work, right? They don't buy goods and services. They don't buy time from that younger generation. They don't accept them. So, if we don't find a way to bridge these things, Gen Z is already showing it's it's adopting a new money. If we don't bridge those two things there, the the big risk here is those IOU's, the IG credit allocations, the 60/40, the risk there, if this goes poorly and we are not successful here in the the next 5 to 10 year window, those IOU's quietly die out in the hands of the Silent Generations and the Boomers, which is a huge setback for kind of the big picture development of, you know, the United States as a nation-state project to carry forward over the course of, you know, a multi-generation infinitely lived, uh, duration project, if this goes the way, um, you know, every American to date has, uh, uh, wanted to to see this, uh, continue to be handed off down into further generations. So it's not a, uh, uh, like an option, uh, in my mind at this point. If we can find a better way to do it, I'm all ears. But Bitcoin has already showed you the quiet infrastructure. It it gives a feasible path to achieve this, and the, like we're already, uh, like toes are in, uh, we've opened the front door and walked in with that Bill Py tweet. So that's slide 11. Uh, the, uh, the famous Bitcoin, kind of black hole gravity well sucking in the dollar. Um, this is, uh, kind of just your latest mile marker of of that process, uh, continuing to develop, uh, that you've been highlighting so well, Nick, ever since, you know, you got onto the scene, 2017, 2018, have been, uh, observing and commenting on this, kind of better than anybody else that, uh, that I can, that that's come across my radar.
Thank you, Dyn. We are in the discovery of a new discovery phase of a brand new commodity in the introduction of a new collateral system on which to build a healthy and potentially healthier credit system. So that's the transition that we're in. When we think about the discovery of a new commodity, it is a once-in-a-lifetime event. And so it's very fascinating to watch. Bitcoin analysis isn't just about when does it get to $1 million, which is the topic I covered yesterday, somewhere between 2020, uh, 2031 and 2033. But that is more a prescription of the path that it we will take to get there. And so these are some of the details. Uh, our condolences to your family for the loss of your grandmother. You know, as the as the older generations pass away, we have to think about, like you said, what are the next generations doing? And I got the opportunity to teach 15 and 16 and 17-year-olds this summer. And it was very obvious to me that they will all be Bitcoiners. Their entire generation. They understand it. It's part of the future. It's just a fixture for, you know, the the upcoming monetary system. So Matt Dyn, Chief Investment Officer of Build, thank you as always for joining us, sharing your expertise, sharing your thesis, and your great, uh, book recommendations that, uh, go deep deep into financial history. So tell people where to find you and any closing thoughts.
Yep. On X. Uh, you can, uh, find me at leveredus or my firm's website is getbuilding.com. And Nick, I know that this is just fun. You've been taking heat, I guess, over the last day or two for, you know, just calling, hey, million-dollar Bitcoin. That's not, uh, too far off, right? Think about this, like what we just described today, where all of these economic incentives, once they're locked in, the engines humming, you 50 million Americans where Bitcoin is a, the backs stop of their, you know, their GSE mortgage on their primary residence. They're kicking in a monthly dollar payment, uh, in support, which ultimately flows down to the Bitcoin collateral layer. It doesn't take, you know, more than a day of, uh, replacement level financial an analysis talent to come up, uh, with, uh, kind of a forecast that that million-dollar Bitcoin price, uh, on, you know, $250K, $300K, what's the actual, uh, housing price inflation going to be in five years, 10 years, and then you get into loan to value, and then you hard peg 21 million Bitcoin. That's all there is. Finite quantity, can't change. Like million dollars. Like that's possibly too bearish. We'll close it there. We'll catch you guys next time.
All right. Thanks, Nick. [Music]