Will Reeves and Yan Pritzker: Swan Signal Live E35Posted 10/29/20 by Brady Swenson
Yan Pritzker, CTO of Swan Bitcoin, and Will Reeves, CEO of Fold App, join Brady Swenson to discuss Bitcoin, entrepreneurship, finding product-market fit, and all of the amazing new Bitcoin products rolling out soon. We also riff on the price predictions for the rest of the year and the growing 2020 trend toward corporate adoption of a Bitcoin standard. Come learn from two of the brightest entrepreneurs in Bitcoin!
Subscribe to the Swan Signal YouTube channel and Swan Signal podcast.
4:18 Growth of Bitcoin-only companies
9:50 Introduction to Fold App
17:00 Finding product-market fit
28:20 Corporate Bitcoin standard
37:44 Bitcoin’s growing market cap and unit bias
46:01 Companies selling paper Bitcoin
56:37 Next big company to buy Bitcoin?
1:00:56 Endowments, pension funds, and governments buying Bitcoin
1:08:11 Is lightning ready?
1:13:20 Price predictions
1:21:45 Microstrategy earnings call
1:23:41 Closing Thoughts
1:27:50 Swan Force!
Hey everyone. Welcome back to Swan Signal live. This is a weekly show that pairs up great guests for compelling discussions about Bitcoin and economics. I’m your host, Brady Swenson head of education at Swan.
We have a monster of a show for you today with Will Reeves and Yan Pritzker. Before we dive in, let’s check in with Swan, we’re doing something really cool that I want to let you all know about.
We are giving away Yan’s book, Inventing Bitcoin, and we’re giving away for free in an effort to spread Bitcoin education and knowledge and a knowledge of Swan as well, which we think is of course the best and safest way to stack sets, especially for people who are new coming into Bitcoin, no distractions from all coins or stocks or anything else like that, just focused on accumulating Bitcoin in the best and safest way possible.
You can go to Swanbitcoin.com/free book to claim your copy. We have it in three ebook formats. We also have it in an MP3 read by our boy guy, Swan from Bitcoin audible.
All we ask is that you pay it forward, share it with at least three friends and family. When they sign up… When they submit their email address, we’ll send them an email from Swan saying, “Hey, here’s your book.” And here’s Swan. Here’s a great way to get started buying Bitcoin.
And to all of you Swan force members, we just set this up. You can give away the book straight from your Swan force landing page, which is awesome because it’s another incentive to get your friends and family to show up and grab that free book and get kind of going in Bitcoin.
Anytime in the future when those people who maybe have been convinced by Yan’s great book, The Buy Some Bitcoin you’ll get referral credit.And of course that’s 25% of Swan fees for three years and they’ll get 10 bucks as well. Finally, as we’ve been talking about the daily betas, daily buys beta is underway. So we’re rolling that out to daily customers. Now we’re squashing some bugs as they come up. That’s what the beta programs for. So just be patient, we’ll get the email out to you in the next week or two to sign up for daily bias. We’ve got a couple hundred customers stacking on daily right now. So that’s pretty awesome. Swanbitcoin.com/daily buys. You can still get it on that beta list. Okay. That’s enough of that. Let’s dive into this one.
We have two entrepreneurs who are pioneering the Bitcoin only industry, we have Will Reeves with us. He’s the founder and CEO of Fold. It’s a great Bitcoin only company and makers of the Fold app, which allows you to get into Bitcoin or to buy a Bitcoin or get the coin while you shop. I’m looking forward to hearing about the latest from Fold. I think we’ve got some exciting news to drop and talk about, welcome back to the show. Will how’s it going, man?
It’s going well, thank you for having me Brady and the whole Swan team.
Okay. Well of course we have Yan Pritzker here as well should be a familiar face. So he’s of course co-founder and CTO of Swan and author of the aforementioned book, Inventing Bitcoin, the technology behind the fruit first, truly scarce and decentralized money explained. So Yan, welcome back to you as well. Appreciate you joining us today. That’s a long subtitle bro.
Thanks for having me I’ve been like killing myself over that subtitle way too long. I don’t know how we ended up with it, but it is what it is. You know.
It is what it is.
You got to commit.
It’s there now. I should know too, that Swan founder, Cory Klippsten is going to be joining us probably about 45 minutes into the show to kind of hang out for the last half hour and talk.
So we’ll have three Bitcoin entrepreneurs on the show talking about building Bitcoin today. Let’s talk about that. Start with talking about the Bitcoin only industry. It’s still small, but it’s growing. And if there’s a huge difference in the number and success of a Bitcoin only companies between 2017 and now going into this suspected bull run, we’re bumping up against 13.8k Right now, which is pretty exciting.
So Will why don’t you get us started? What do you see the Bitcoin industry, Bitcoin only industry eventually surpassing the broader Crypto industry and like importance and magnitude, one other kind of Bitcoin only companies do you see emerging in the next five, 10 years?
Yeah. I think we’re seeing that happening right now. You can look at price comparisons. You can look at actually adoption happening meaningfully outside of this small group that we like to call Crypto-Twitter, Bitcoin-Twitter. Bitcoin, whether you like it or not is a household name.
It is a brand name that is spoken about at dinner tables, by people of all professions, all ages. And it’s something that if you’re increasingly tying yourself and your company to that idea and that asset, I think we’re only going to see more and more successes.
And the story of the kind of innovation in the space with Bitcoin companies is that we’re only broadening and diversifying what types of services and use cases that we handle. If you look back a couple of years ago, speaking of the last bull run we had exchanges. Now we have a plethora of ways to earn it, to use it, to hold it to custody. And it all is maturing far faster than I even thought. And it’s happening at the same time where Bitcoin is now on the minds of certainly I think of all young people looking at their own financial outlook and their financial future.
But also those that are watching their own ice cube melting and feeling like they need to look beyond. So I’m very bullish, not only on price aspects, but the fundamentals of Bitcoin companies.
Yeah, absolutely. I hear that man. It’s very exciting Yan, you’re obviously a part of this emerging industry as well. Why did you get into it, man? And why do you feel compelled us to be building in this industry? What are you excited about?
Yeah, I think I got into it for the wrong reasons. Like a lot of people, I was attracted by a really interesting technology. I am a technologist and I spent 20 years building startups.
So when I first saw Bitcoin, I thought, “Okay, this is a very cool open source payment system. This could be something really interesting.” It wasn’t really a long time. I first heard about it in 2011, but in 2016 I finally sat down and really researched it.
And by the white paper and read all the awesome resources that are out there things from PRO Shard and VJ and things like that. And I finally understood it as money. And I think when we talk about building Bitcoin only businesses in other way to say it as building businesses that are based on money and that’s something else, right?
If Bitcoin is the money of the future, then the businesses we’re building are all in support of that idea, banking loans, earning, spending, holding custody. And I also think there’s a whole component here, which is kind of this evolution of how does Bitcoin become money. And I think this is a VJ’s framework.
It has to be collectible and store of value first. And so right now, a lot of the use cases are around accumulating it, right? We’re going to accumulate it. We maybe want to look at inheritance planning, passing on to our children.
You know, if hyperbitcoinization happens tomorrow, great, but I’m fully prepared to pass the Bitcoin onto my children as a store of value for their future. If Bitcoin is not sort of like a global unit of account and medium of exchange and as more of a holding technology and a savings technology that’s also fine.
So I think there’s different time horizons for building these different kinds of businesses. And I think what happened in the first… If you call it the first epoch of Crypto and Bitcoin was exchanges were built because that was the first use case of speculation. People just want it to trade and try to get more Bitcoin.
And they still do right today. A huge portion of crypto activity is really just people trying to make more Bitcoin. So if you look at all the 7,000 plus coins that have been produced since Bitcoin came up the use case for them more or less is for traders to try to make more Bitcoin.
So that’s a fine use case and exchanges have made a lot of money doing that and supplying that gambling kind of behavior for people. But I think what we’ll alluded to, and what I’m saying is that we’re trying to build around the Future of Money, which has Bitcoin, which are long-lasting businesses. They’re not here to make a quick buck. They’re Here to help people plan for their future.
Yeah. Long-term thinking just like we preach about in Bitcoin itself. And one of the things I love and we talk about a lot as Bitcoiners is really, if we adopt Bitcoin as a global reserve asset, global base money, we will be the economy itself, not just Bitcoin businesses, but all businesses of all kinds, really thinking more longterm and being able to plan for the future, not like rushing quarter to quarter, trying to meet those earnings expectations and get the stocks pumped that stock price you’ll have some money that you can maybe watch increased by $95 million in a couple of months, Micro Strategy is up $95 million on their buy right now.
And it’s just getting started. So yeah, Micro Strategy can really plan for the future in a different way. Now that they’ve made this commitment to Bitcoin. We’ll man, it’s exciting times at Fold. So when we scheduled the show, I asked you… I was like, so what’s the ETA. Everyone’s been so excited to get this thing in their hands. What is the status of the Fold card then?
The Fold card will be in people’s hands that in November, the crazy thing is we had nearly a hundred thousand people on the wait list for this card, which to me, when we launched this, I was expecting, let’s get 15,000 people, we’ll get the hardcore people, then we’ll expand.
This is happening way faster than I thought. It’s just a reflection of the pent up demand just broadly in society. And it’s really what I’m learning is it’s not just about when people find Bitcoin, but it’s about increasing the opportunities for them to discover it and start their journey.
And as we start to build more products like Fold, like Swan, that appeal to lowering the barrier to entry, leading with education and putting Bitcoin to the forefront without any of the noise, what you start to see is that more and more people start to take the plunge earlier.
So it’s not that we need to go around bashing people in the head about why Bitcoin is great. We need to increase the on-ramps for that start to appeal to people. And so Fold is working that, Swan is working on that.
And I think the product that we’ve created just found this massive pent up demand that it exceeded my expectations, my team’s expectations, and all of our partners to build this, we’ve brought in visa banks.
And I have to say they’re as equally stunned as we are about what this means for not only their bottom line, their market. And I know that this is opening the this is really the beginning of the journey.
And I think a lot more people are starting to realize that these kinds of secrets that as here know may know about. And so I’m really excited for that, but I can tell you Fold users will have the card this month in November.
There really is no other card experience like this. We’ve purposely made this to be… To reflect the values of Bitcoin, to feel completely fresh and new, and really to create a, the easiest way for people to start their accumulation journey. So I think we are right on the precipice and I couldn’t be more excited to launch it. I want to start using this thing.
Yeah, man. Me too. Me too. So how does it work? I mean, is it as simple as you just go anywhere, visa is accepted swipe and you get Fold rewards in the app.
Yeah. So this Fold card can be used at all 61 million merchants worldwide, and you swipe the card, you use it online and you’re going to be guaranteed to get a Bitcoin back. Only Bitcoin and there are many other things you’re going to earn a yield on this Bitcoin. You are going to, every time you swipe this card, you’re going to be given the chance to win an entire Bitcoin. So we really tried to look at designing this program with Bitcoin, from the ground up, what are the game mechanics inherent in Bitcoin? What does proof of work mean and how that could be represented in a product?
And really what comes out is the more you engage with it, the more you’re going to get back, and you’re guaranteed to increase your stack along the way. So I think this is going to feel fresh.I’m a little nervous to launch it also, because this is going to be so different than any other card. And I’m excited to see what the market says, but Folds ethos, how we build products is built in the open. And so this card from the ground up has been built not only with Bitcoin in mind, but with our users in mind. So a lot of features that you’re going to see are directly from requests that our users have had. And we’re extremely grateful for that.
So what’s exciting is that like you said, we’ll probably be bringing in a lot of new people and if you’re making the experience really fresh because you know, credit card and rewards programs have been around forever, if this experience is a lot different and you’ve got kind of the shine of Bitcoin and people’s curiosity about it kind of backing it up, it seems like you might have this sort of like a really great way to bring people into Bitcoin. What makes it so much different than the traditional credit card rewards app?
Yeah. We look at where Fold success is coming from. And we see that 50% of young people want to start investing in Bitcoin. A fraction of that have actually done that. 42% of people say they want to purchase Bitcoin in the next five years. And so with Fold, we’re trying to deliver a familiar form factor, a card with a banking kind of FinTech app, but in a directly created for this new emerging group of investors who are coming to market. And so with us, this whole experience is inspired by Bitcoin and gaming. Our team loves both of these things where all Bitcoiners, a lot of us are gamers. And so what’s going to happen is as you’re using this card, there’s going to be multiple ways to start earning. You’re going to be guaranteed to be stacking Sats probably far more than you would with your existing card, even high yield or high, high reward credit cards, but it’s not going to be your traditional credit card of set it and forget it.
It’s going to be something that the more you engage, the more you’re going to earn, we’re going to have milestones for people. It’s going to reflect where Bitcoin is and Bitcoin’s price.
One of the most amazing things that we’ve seen is on Fold we advertise what rates you get back at these various retailers. 4% at Amazon with the card, you’re going to get 5%, but we start to look at the actual value you’ve been given. So now people have been stacking in March when the value is at $3,000. Now we’re looking, hopefully we’re going to punch through 14 today. You start to see the percent cash back you got as no longer 4%. It’s no longer 8%. It’s pretty incredible. What happens. You know, one of the things our users always talk about is each spend with Fold, the SATs back, I get is going to pay for it in the future anyway, the entire purchase. And this is where Bitcoin becomes the greatest marketing invention ever. It is a payments technology. It is money, it’s things, but ultimately number go up. And this culture that we have created and building new ways to interact with this asset really does it for us.
And the Fold is seven people. I am technically the marketing department and that’s because we don’t really need it. We have Bitcoin to help us out here. And so I think I’m excited to start. So next week, we’re going to start dropping the full program details, but I can promise you that it is not going to look like your average credit card or debit card.
I think really cool that you’ve identified this product market fit. Obviously I think the having a hundred thousand person sign up lists really speaks to that. And I think that’s so important when you’re building these startups is really not just building for fun because the technology is cool, which you see a lot of on other platforms, you see a lot of very interesting quote unquote interesting projects, but with a very limited user base, identifying where the actual pain points are for people and really, really building your product to that.
And like you said, you listened to your users, right? What are they interested in earning the future of money that is increasing in value it’s very, very powerful proposition. So my hats off to you for doing that, I think you’re teaching people about that in the right way.
They’re earning our Bitcoin and they’re seeing the value of the Bitcoin go up. And they’re understanding the value of the Bitcoin when contrast that to the value of their U.S dollar holdings, which are not gaining in value, if anything, they’re losing value tremendously.
So I think it’s a great way to educate people by just watching a number and you’re right, like Bitcoin does all the marketing for us, right? That number goes up and more people come into the space, but having products at the right time for the right audience is so critical. So very nice job.
Oh, thanks. I have to say you started off saying you may have gotten into Bitcoin for the wrong reasons. And I have to say I think a lot of us did. A lot of us did that had that same journey. You know, part of my journey was building a product that didn’t necessarily reflect what the market wanted or what Bitcoin was. If you look back at where Folds started, it was spend Bitcoin on chain and receive a discount at Starbucks or any given thing. And the idea was, a lot of people have this asset for a lot of other people around. It’s not real money cause you can’t use it at places as well. That’s a problem there let’s create something, allows you to use it. You have a kind of a social ritual to say, “Hey, this is actually accepted.”
You’re incentivized to get a discount on it. And that’s what Fold was for awhile. And the only reason why we are here versus today and the user base that we have today compared to then is shocking.
And it’s just about keeping your ear to the ground. This is not something… This is not a token we’re launching for a quick up and running. We’re building a business for the longterm. And so one of the most important things for that is to be very close to your users and especially very close to this phenomenon that we call Bitcoin. Cause we’re all learning about it in real time. Some of us are building a product on top of that. So we have to change our own minds and then we have to change the product too, to reflect that. And so Fold has been an absolute journey about that reflects mine and my team’s journey about how we’re understanding Bitcoin, how our users are giving us feedback into what we need to be building next.
And all of what you’ve seen, the evolution of where Fold is, is the collective education that our user base has given has kind of shown us back in a mirror and our own journey as well. And so we are excited and very grateful for things like, Swan force, this type of educational outlet that helps people accelerate that journey because for some of us, we were lost in the woods for years. And this is the exact type of platform that’s going to help people accelerate that understanding.
Yep, absolutely. So Cory in the chat saying we don’t need a marketing department guys cause Bitcoin’s going to do it, kind of do it for us. I’m here. Like my title is head of education. That’s kind of, that was strategic, right?
Because our marketing is education or education is marketing and Bitcoin number go up is the main driver and seen that with subscriptions and people setting up plans, price goes up interest in Swan goes up and that’s just the way it works.
We can throw in some education to compliment that, try to get people up to speed on what’s going on and really make better decisions about how to engage with Bitcoin and avoid scams and gambling, et cetera, et cetera.
Sorry, I just do on that one point, that’s exactly the difference of education and marketing with us building on Bitcoin. We don’t have to pretend Bitcoin is anything else that it is not, we don’t have to sell a bill of goods that it doesn’t reflect the underlying asset.
For us it’s purely about opening up a door to allow people to see it’s on the other side, that’s it? You know, the marketing side is that’s what I mean about the marketing aspect. Nothing has to be dressed up about what we’re talking about and days like today, it plays out in real time in front of everybody.
Yeah. It’s amazing. I mean, we’re up over 28% this month and we’re going to talk just bullishness here in a, generally in a minute, but while we’re talking about businesses, Yan I want to hear you talk about Swan and you the evolution of Swan, it’s been about eight months now, since we launched maybe a little bit less than that, but can you talk about how things have been going, what we’ve learned, how the products evolved, what we’ve got coming up.
Yeah. We’ve learned a ton. So Swan for those of you don’t know was actually an evolution of another product called Give the Coin, which was originally founded by Cory and Give The Coin was a way to gift the coin to your friends and couple that with education.
And that was the first iteration of the idea of onboarding people through education and really turning them into Bitcoiners, not just people who are sent to some kind of exchange website to gamble, but really they’re learning about this new asset.
They’re figuring out why it’s important and they’re learning to hold it, Give The Coin was actually coupled with a one-year Timelock so that people couldn’t say sell it. If the price went up or went down and kind of get racked, which a lot of people do in their first year of Bitcoin.
I certainly got wrecked that way when I first bought Bitcoin. But over time, we also recognize this very kind of selfish drive for people to accumulate for themselves, which is really Swan. The evolution of Swan is recognizing that people want to build their own stack and doing it in a way that is.
Build their own stack and doing it in a way that is friendly to newcomers, right? This is, was Swan’s mission was always onboard the next 10 million Bit coiners. And we use the word Bitcoiners specifically, not onboard the next 10 million crypto traders, right? Bit coiners people who understand why they’re here and why they’re going to hold on to this thing. And of course, education is a huge part of that, as you mentioned, and that’s why we’re giving away the book too, because the book really understands or helps you understand why you are a Bitcoin holder and why that’s interesting to you and why you might want to pass it onto your children. These are things that are very important to understand. Swan target’s kind of two audiences at the same time. One is we have this fun community on Bitcoin’s Twitter. Everybody loves to stack we’re stacking SATs, we’re making a game out of it.
We’re seeing who could stack the most, and there’s a real fun component to it. And there’s going to be more and more features coming out for that as well. But the other one is we have to recognize that a lot of people are just new to Bitcoin. We see actually a lot of older folks coming in. We see a lot of boomers, gen Xers and millennials who are bringing their parents onto the platform. We actually onboard a lot of mother and daughter, mother, and son combos, which is really cool to see. And we have the children emailing us in support saying, my mom, where my dad’s coming on, please be nice to them. Please help them out, which is fun to see. And we have to recognize where those people is… When we talk about Bitcoin and we talk about not your keys, not your Bitcoin.
And we talk about self custody. These are all really, really tricky concepts. And so with Swan, we are always trying to balance that. Get them the foot in the door, but then teach them that next level. Right? So when we onboard people that are older, a lot of times they don’t want to take self custody. They’re actually not sure about how to do it, but sometimes they work with us and they work with their kids to kind of understand that as well. So we have all this email campaigns and drip programs that tell them about all this, all the capabilities for their self custody over time, but we don’t try to hit them over the head with it and don’t try to scare them with it because I think it is really important for people to feel secure about their holdings.
And this is something very tricky with Bitcoin user experience to balance that like ease of use, which is you sign up for an account on a bank and it’s easy to use, but with Bitcoin, now you have to set up your wallet and write down your seed phrase or set up a multi-sector solution. These are all things that we’re balancing with our education. And then over time we’re onboarding more and more folks because started getting a lot of interest in people, wiring money to us. And now we’re getting bigger amounts. People are coming in with larger purchases. We’ve recently launched daily buys and we’re launching what we call formula buys, which would allow you to deploy, let’s say a lump sum over some period of time. And those formulas will get it more advanced over time.
And we’re bringing in a lot of other products that are going to be good for people’s long-term savings. So for example, the support for entity accounts, so that if you want to come in and buy as an LLC, if you have a checkbook IRA, you can come in and start saving with us. And we’re also going to be offering our own IRA products over time that would allow people to sign up and start accumulating for their future in a tax advantage account. Which I think is really important, right? And Bitcoin, a lot of us are not planning to spend our Bitcoin we’re planning to save it for the future and save for kids. And so having people, giving people those options is something that we’re really excited about.
Just want to hit that one more time on the education front Swan, bitcoin.com/free book. And we are like, Cory says, one’s propensity to store value in the Bitcoin verticals is correlated to one’s understanding. And that really underlies what we’re doing, what folds doing what we’re doing at Swan, trying to just educate people, get people in the door and then kind of walk them along the Bitcoin path. Plus things are getting easier in this Bitcoin only industry to hold your own keys, easier and easier with companies like Unchained and CASA providing solutions that are really pretty simple to hold your own keys in a very secure multi sign way. So that’s really exciting as well. Things are coming along. It’s an amazing time to be in this industry.
We’re also seeing that play out in real time, as people are increasing their plan sizes, right? We’ll see people sign up for our accounts. The most typical is 50 bucks or a 100 bucks a week. They’ll start stacking few weeks go by. They get our emails pumping, Bitcoin education. And we have all this information about what’s going on in the market. We have micro-strategy buying Bitcoin, we have square buying Bitcoin. All of a sudden people are waking up and saying, Oh like, this is isn’t just a joke. This isn’t just something fun that I signed up for. This is real and it’s happening live. And I need to get in on this. And so right away, we see those people talking about wiring and more money or increasing their plan sizes. And so a lot of our growth and less even, especially in the last four to six weeks, I would say, came from people actually increasing the plan sizes because they’re seeing all the bullish news in the market and it’s very hard to ignore along with the price action that something is, looks like it’s happening here.
Yeah, absolutely. Yeah. I mean, it does appear that we’re on a precipice of an impending bull run. You know, I always get a little bit I don’t want to be at no absolutes. Right? It’s about the Bitcoin price. Don’t want to guarantee it, don’t want to jinx it or whatever. It looks like this podcast has already crashed it. I fail all the time, but I tried to. But it looks like we’re on the precipice of a bull run here. There is this palpable sense of energy on Bitcoin Twitter, and just kind of in the space in general, we’ve had a nice pump, like I said, over the past month, over 28% up now. And we have this emerging narrative of Bitcoin as a corporate reserve asset, a treasury reserve asset. And it’s interesting because we didn’t really, as far as I can tell, see that coming or talk about it a lot, we’ve been talking about the next narrative, really this cycle really just honing in on digital gold.
That was going to be what brought in a bunch of bigger investors, the boomers, maybe institutions as well, but we didn’t necessarily see that it was going to be bought by corporations a lot. And that’s definitely emerging. Now we’ve got swa… Just in response to the demands and talk about listening to customers. We’ve launched one treasury, a Swanbitcoin.com/treasury, get in touch with us. And we’d love to help you out. We have a few clients already. So Yan, it seems like we kind of missed this, but we have this narrative emerging. Now, how important do you think it is and how, I mean, how big of a deal can it be for bitcoin?
I think it’s really big. For me, I’ve always, when people have asked me when is Bitcoin adoption going to happen? I’ve always said, what does that mean? Right. What does adoption actually mean? And I’ve always thought that in order for a Bitcoin to become widely distributed in the kind of everyday population, it’s not going to be a quick process. I think it’s a generational shift. And as Will pointed out 50% of young people want to buy Bitcoin, but it still haven’t. When you get older, and this is also research that Dante Piero has done. He’s been talking to people that are in the forties, fifties, sixties, above a certain age group. You get real friction. Like if you’re 60 and over, not a lot of those folks are buying Bitcoin. Although we are onboarding some of them at Swan, which is great, but I’m under no illusion.
I don’t think my grandma’s going to be buying Bitcoin. So how will Bitcoin get adopted? I think there’s a lot of different paths to it. And I think unfortunately, or maybe unfortunately to some degree, a Bitcoin, like anything else, it requires access to resources, right? And knowledge, if you understand Bitcoin and you have the money to buy some, you’re going to be there and you’re going to be doing that. That’s going to shift the balance a little bit towards people like Michael Saylor micro-strategy, who’s been thinking about technology for 30 years and has a lot of money while he’s going to go and buy $500 million with a Bitcoin faster than you and Me are. Right? That’s just the reality of it. So I think this is an important narrative because it will legitimize Bitcoin. So while he’s over there buying his 500 million, now that’s making Bitcoin safe, right?
It’s making it much more palatable to the average company. That’s smaller than Saylor micro-strategy to look at it and say, Hey, this guy just committed 500 million bucks. What are we going to do? We’re not going to put in $1 million into Bitcoin, right? What’s in our treasury, how fast is it melting? And what are the smart people in the world doing with their treasuries right? Now we have micro-strategy. Now you have square. You have a handful of other companies they’ve just legitimize this whole concept, right?
So as they legitimize Bitcoin, this has an overall effect, legitimize Bitcoin in the wider market. And that goes trickles down to people who are going to be looking at buying Bitcoin, including people who are millennials or boomers. It doesn’t matter. Right. They’re looking at it in the news. And they’re seeing that the number one financial app in the app store is buying Bitcoin, is selling Bitcoin. That really changes the perception. And I think that’s really important. So their perception shift leads the culture shift, which then creates this quote unquote mass adoption. But I’ve always said the mass adoption may be in ways that we didn’t predict, right. It may be that corporations or governments use it first before the everyday person does. And that’s just fine because Bitcoin is a system that has different properties for everybody, right? Everybody can benefit in one side of it acts, then everybody else benefits from the increased depth of market increased price, and so on.
Will, when you see micro strategy making this $425 million buy there, it’s well over worth a dollar terms over $500 million. Now it’s increased by 95 million. As I mentioned earlier, in a few short months, that’s four times annual revenue of the company. They’re having an earnings call this afternoon. It’s a good day to have that earnings call. I’m definitely going to be watching it. So this is the message it’s going to be spread about. Look the companies that are making big bets on Bitcoin as a treasury reserve asset are really seeing massive gains. That’s just going to cause a snow pile in and maybe Yan it’ll cause people to convert their personal treasury into Bitcoin, or at least some of it. I’m living on a hundred percent Bitcoin reserve.
It’s made me a lot more comfortable about that. Right. I also live with a very large ca… Most of my cash is in Bitcoin. So I always have thought about it. I have to say that in the last six months I’ve changed my perspective, which was fueled by one the Corona induced printing of money, but two of these corporations making these bets, because I used to say to people buy some Bitcoin enough so that you feel comfortable. Or spend as much or convert as much of your personal funds to book one as you’re comfortable with. And now my perspective is really shifted around. You should always be buying more and more Bitcoin. And not just because I launched Swan, I think that that has something to do with it. But really the world is changing, right?
The money is really being debased. We used to talk about that as being is happening slowly, but it’s really happening in a big way. And people are waking up to that. And now that these corporations are making these moves, they’re really legitimizing the idea that your savings should be in Bitcoin and not some other money that is arbitrarily printed. So I’ve changed my perspective. Really. Look, I’ve been in the space for a long time, but even for me, it took years for me to feel that level of conviction. Some people feel it earlier. And my hats off to you if you’ve been stacking Bitcoin and a hundred percent in Bitcoin for the last five years, but it took me a while. And I think it takes a lot of people awhile, including smart people. It’s a risk thing.
Will, what’s your take on this man? This kind of last few months, this big move at corporate reserve assets, people accumulating. And in that regard, what’s your take? And do you personally hold Bitcoin as your reserve asset?
Well, I probably am overextended. I have myself and my company is primary reserve assets. So we’re what you call all in. Now, we look back at… We’ve always been talking about mainstream adoption is going to do it. No, no government adoption is going to do it. Indefinitely corporate adoption as the reserve asset kind of came out of nowhere. But when you think about a corporation adopting Bitcoin, this actually comes down to a couple people in the organization who’s making the case. This isn’t just some random thing that a big board decides. There are Bit coiners in these companies that I’ve been advocating for this. So it all comes down to an individual level and us arming more and more individuals to take step so they can in their own lives, some people get their paycheck and that’s what they do.
And they can DCA with Swan and stack with full. Some people have other levers, they are entrepreneurs. They actually have a corporate reserve to actually allocate to something. Others work in governments. This is actually at an individual level of Bit coiners going through the journey, getting their understanding to a level of confidence that not only are they okay with putting their own money into Bitcoin and using that as their reserve asset, but they are ready to go to their board and make this case. And that board is most likely going to be made up of people in that boomer category who either have very positive or very negative understanding of what Bitcoin is. And so it definitely takes a longer cycle. But to me, it’s definitely the more I’m processing, it’s just part of the saturation of education amongst individuals that then are starting to pull whatever the lever they can to increase their exposure to Bitcoin.
And so I would say with fold, we have had hedge family offices. Having their whole families spin the wheel together and stacking, and just having fun with it, not ready to make the case. And then they’ll call and say, Hey, well, let’s talk. And for them it’s, tell me about visa. Why is visa interested or why is Stripe or all these other companies that we maybe work with about tell me how much they value it. And so they’re not quite there yet about with their own journey to advocate to their own fund, but they’re on the way. And so again, it’s micro strategy, Michael Saylor went down the rabbit hole far before actually micro strategy did this allocation to as their reserve asset, Jack Dorsey, the same thing. So it’s coming from familiar places and it’s all coming from an individual level.
And as Yon was talking about these things, just start to stack. Once you have Jack Dorsey getting squared to do it. Now, it’s not just fringe, Jack Dorsey CEO, it’s square that those people will have investments in and start to lower the barrier of mystery of this asset or the idea of risk of it. And so these are just reverberating circles around individuals. And I think it’s incredible to see that’s where it’s coming from. A Bitcoin at the end of the day is about empowering individuals. And so you see this individuals then taking this and then orange pilling their companies, their families, their friends. And I think right now, we’re just seeing this start to hit a critical mass.
Guys. I’m so bullish right now. I’m so bullish. This is amazing. A gray scale, really. I mean, just speaking of more bullish stuff coming out, news coming out, gray scale released their annual report today. Their Bitcoin investors study revealed that over half, 55% of US investors, this is a market that they estimate at about 32 million people. People with over $10,000 of investible assets on hand households. And that’s up from 36% last year. So a 20% increase just in one year over half of… So what is that? 16, 17 million households interested in investing in Bitcoin? This is next level, right? And this is not just companies and the companies that news, like you said, will kind of de-risk that, or give people a reason to really get in if they’ve been thinking about it. And as new all-time high come, we’ve been talking to the chats, talking about it too.
We’re at $13,600. Now I think the local high, the previous high was at Bitcoin 2019 last year, like April or may or June, I think it was June or something, $13,800. It ran up during that weekend. And that was a lot of fun. Everybody was super excited. We’re back there. It took us a while, but we’re back there. What do you guys think about that when you see in that number? And if we break that how soon do we get to the all-time high? It just in our amateur Bitcoin or TA
We’re actually above that, right. Because we’re, aren’t we above that, a market cap, I haven’t looked at the numbers exactly. But more Bitcoin has been issued since that time. So if it was 13 back then, and it’s 13 again, now it’s actually more value. The market cap is at 240 billion or something and that’s actually something really interesting. Let’s see what the market cap is. So 250 billion, 252. So I actually started talking about market cap. I’m trying a new technique with my friends and my various social engagements is not to talk about the price because when you say Bitcoin is $13,000 what does that sound like to the average person?
It sounds like what the hell? That’s insane. Somebody is willing to pay $13,000 for some digital beanie baby. Like what? That makes no sense. Right? It sounds expensive. It sounds crazy. However, when you say Bitcoin is worth $250 billion, that’s a different conversation because you’re establishing that the market as a whole has this tremendous value. And that value is being tapped into, by large entities, like micro strategy, like a square you’re having a different conversation. Bitcoin’s worth $250 billion. Gold is worth $10 trillion. Right?
Yan froze. Will take over, man.
I can take over here. I Think where I was going. It was exactly right. I think we’re all playing with what is the right angle to do? There is a unit bias here. And so there are many ways to measure Bitcoins success. How are we doing? We still in here?
Yeah, keep going man.
Awesome. So we have hash rate. We have market cap, we have price of a coin. We have the fact that the one number that never changes that there are 21 million, there are many ways to get into this. And so I think speaking about this more as a market cap, it goes to this level of this de-risking when you talk about price and there is volatility in that volatility is great, but it takes people a little while to understand why that volatility is great. And so when you talk about market cap, you start to get into things like, Hey, there’s 250 billion of smart money in here. Let’s talk about who’s in here? Who is who’s part of this. And it goes far beyond a fringe group of people now, that tent is getting bigger and bigger and bigger and more legitimized from traditional credentials out there.
And so for me, I think that’s a very successful way of speaking about it. On the other side, when we were breaking down Bitcoin into Satoshi’s fold, there’s actually maybe in our metadata for SEO, we include Bitcoin, but nowhere in full, do we really talk about Bitcoin? We talk about Satoshis. Everything is measured in STAs. And so on both sides, we’re re-imagining what are the metrics that are going to get people in here. What’s going to help people click faster. Let’s get rid of unit bias. Let’s talk about the overall market cap and who is contributing to that growth in that market cap, I think have all been real breakthroughs in the last year, actually alone of how we speak about Bitcoin. And so I’d say we’re talking about here on the chat on the side. I see the amount that Bitcoin that square is selling the amount that gray scale is eating up.
The amount that Microstrategy put in is eating up the rewards total rewards for weeks at a time. And so I think also for the first time, we’re actually seeing this scarcity actually play out in real time, in a very obvious way. That’s not just obvious to people who are looking at the charts that are actually looking at the emissions rewards and everything. This is now felt by actual people. And I think we’re going to only see that more, that’s going to be an underlying FOMO mechanism. That’s going to be constantly there. And so I think when you talk about where we are bullish and where we’re going, I think Bitcoin has this amazing element to just be both sound money and all about rationality. But with us, humans are being emotional people. It is the price and everything is going to be turned by irrationality.
Because it’s going to be like, where is my value most safe? And that value your money in your mind is worth more than the actual money that you have. And so for us, Bitcoin is going to be the tent. That’s going to absorb that imagination and that you’re going to be confident to follow that because of the sound infrastructure that it’s built on. So it’s such a phenomenon that creates so many questions of psychology economics. You have to be the Renaissance man to actually fully grok this. And I’m still managing myself along the way, but this year has been enormously helpful regardless of how many years you’ve been participating in this space.
Absolutely. And thank you all for picking up my thoughts in that sentence. You finished them perfectly. Can I kind of hire you as a body double? I think you had made a really great point about the SATs, both the SATs and the market cap are a good way to think about it because they do eliminate that kind of arbitrary, not like $13,000 is an arbitrary number of based on a hundred million Satoshis right. A hundred million units of the actual currency. So it is a very strange thing to do. And I really hate those articles that say, Bitcoin is now worth more than gold because they’re comparing the price of Bitcoin to announce of gold. And it’s like the completely arbitrary. It doesn’t actually help anybody. It’s actually not worth more than gold. It’s tremendously undervalued compared to gold. So I think we need to eliminate those biases and we need to work on ways to explain Bitcoin to people. You can think about it as SATs. In that case, it looks incredibly cheap. You can look at it as a market cap. In which case you can talk about all the money that’s coming into the market. Like you said, I think both of those are great ways of talking about it, but Bitcoin is complicated, right? It’s different things for different people and understanding that the narratives that we have are targeting different kinds of individuals is also very important. And so I would probably not talk about SATs to a high net worth individual necessarily, but I probably would talk about it to an everyday user who just wants to earn some cash back. That makes total sense to me as well.
Yep. Yep. We’re making Sats the standard for most people. Right? I think we’ve got Cory in here, backstage Brekkie, if you want to bring Corey on. There he is. There’s the man. Cory.
Good to see you guys. Will, Good to see you, man.
It’s been awhile Cory.
It’s it feels like years ago, hanging out eating Mexican food.
Years ago, hanging out and having Mexican food and margaritas.
Margaritas in the sagebrush.
Man, a lot’s gone on since then.
It has, I thought we could jump into talking about PayPal and talking about businesses that are offering quote-unquote “Bitcoin” through their apps, like PayPal and Robin Hood that is not withdrawable, not depositable, that really is just kind of a dollar denominated version of Bitcoin. It’s a UX. It looks, you see Bitcoin, but really on the backend, it’s just PayPal and Robin Hood playing with dollars. What do we think about how does that game theory play out for companies like Swan and Fold who are dealing in actual Bitcoin and trying to educate people to take control of their Bitcoin and actually buy the underlying asset versus these large legacy institutions that have kind of this massive reach, but don’t really care to deal with the asset itself? who wants to get first stab at that?
This is the next educational battle that that is starting for Bitcoin-only companies. The whole reason why Robin Hood and PayPal have decided to jump in is because their hand was forced by Square. They’re just the metrics that you see from just when these companies add Bitcoin to the user adoption that they see, their cost of acquisition going way down, profits and revenue going up, the stock price going up. They already know, and they’ve already had examples like Coinbase’s success and others, they know that they’re going to miss the boat. And so what you’ve seen with the PayPal and Robin Hood-style implementations of Bitcoin buying on their app is just a FOMO haphazard, let’s get in there and totally do it in a way that is really comfortable for us.
We don’t have to actually, bring on the reality of what Bitcoin is or what it could be for their users. And so for the Bitcoin-only companies, it’s now our job to fully realize and help educate users on the difference between that. What does that mean? Because for a lot of people, just getting a position in Bitcoin is an enormously large task. It takes a lot of education just to be like, “Okay, now I’ll do it.” Now, they already have PayPal, they already have Robin Hood, and that’s just the most frictionless way to get there. But what they don’t know is the whole rest of the story. And that’s what these Bitcoin only companies need to do is to educate about that, defend that, and to really say the value proposition that a Bitcoin on a Robin Hood versus a Bitcoin on a platform that allows you to self custody it are not worth the same.
Those, those have very different values. And so for us, it’s certainly something that we feel is the next phase, because while Bitcoin getting in the hands of 300 million new people with PayPal is incredible news that we should all be bullish about, that’s not the actual Bitcoin that we’re all here for. And so it lands on us as Bitcoin builders to change that narrative. And we’re used to being in the David versus Goliath position and so it’s pretty comfortable for us all, I think.
Yeah, I would also say that I really like this recent article that was put out by Aleks Svetski about Bitcoin’s necessity versus luxury in different places. PayPal does not cover all countries in all cases. I mean, imagine having this number on PayPal. For Americans, it might be okay to have a number on PayPal, but you can’t send it across borders to certain countries. You can’t pass it on to your children. There’s certain use cases that are not covered by anything except for physical Bitcoin. And so I think those use cases will always drive Bitcoin’s adoption as a physical, underlying asset. And the people who really need those use cases will always have a way to get that. Just because Bitcoin exists in these databases like PayPal doesn’t make it less Bitcoin‑y, right? I mean, it is less Bitcoin‑y over there, but Bitcoin itself still exists.
So you can always go and get that actual Bitcoin from a company that will sell you the actual Bitcoin, allow you to actually withdraw it. So I think there will always be a use case for that and a demand for that. And we have to remember that we are entering into a world, a brave new world of digital money, where most of our money is going to be digital, and it’s all going to be gated. And pretty soon people are going to be limited by that. And there’s lots of places in the world where you literally can’t take the money out of the country with you, you can’t send it abroad, you can’t travel with it. So many problems that money, that you’re going to want the physical Bitcoin to enable you to do those things. And the number inside of PayPal is not going to enable you to do those things.
And that narrative around freedom is always going to drive Bitcoin in the places which need it the most. Now it is possible that in America, because for us, for most part, Bitcoin is a luxury item. It’s not a day-to-day necessity to survive. A lot of people might buy that number on PayPal and be happy with it and see it go up and think that they have something. But I think over time as our laws become more and more restrictive and more authoritarian, and especially with digital payments, people are going to wise up to this. And I agree with Will, it is our job to educate people on this, why money should be free from government and corporate control. And over time, we’re going to see that develop. But again, it’s going to happen more in the places that need it, and maybe less in the places where it’s a luxury.
So I have a little take on the PayPal thing. PayPal didn’t do this for their users, in the same way that let’s say like, Square selling Bitcoin, it seems like a good thing or what Swan is doing or whatever. PayPal did this for PayPal. This is actually leveraging the strengths of Bitcoin and actually understanding basically what it does and the economics of this for PayPal. And I don’t understand it deeply, but I’m starting to kind of grok it just talking to people. Their users usually just generally take the payment and withdraw it very quickly. And, PayPal has partners and vendors to pay out. They connect with banks and they have ACH fees and all kinds of other things. And so basically if they can get a huge percentage of people, even a small percentage of people to keep their money on platform, which they’re much more likely to do, if they have a good store of value in Bitcoin, or if they’re speculating or whatever it is, Bitcoin should absolutely skyrocket the amount of value that’s stored with PayPal and they’re not going to lower their fees.
So they’re going to eat way more margin than they have before having to provide on and off ramps for their users, with every other banking and financial partner in the global financial ecosystem. So this is potentially an absolutely massive win, it’s very selfish. It’s fricking amazing because it shows that using Bitcoin selfishly for PayPal, which has a lot of pro-Bitcoin people. Remember, this company initially was founded to try to create true digital E‑cash back in the late nineties, that was the goal. And they had a CEO who left in 2014 that keeps on getting dredged up, because he said some nasty things about Bitcoin, but that dude’s not important. The guy that’s been there for six years is pro-Bitcoin. They’re going to be just fine. They can’t safely run this business without actually having a ton of Bitcoin exposure.
They are going to have to hold a stack, they’re going to have to hedge and probably match whatever their users hold synthetically. So it’ll be kind of fractional reserve-ish, but they’re going to have to buy a lot of out of the money calls and sort of, there’s going to be upward pressure on the price because of this business now existing at PayPal. So, it’s super bullish. It’s also going to be exceptionally clear to people that this is not Bitcoin. Not your keys, not your coins, and you’re going to have withdrawal limits. If you buy a lot of Bitcoin on PayPal, A: you’re going to be paying like 4%, which is going to suck. And as soon as your friend tells you you can get it much cheaper somewhere else, you’ll probably do that. But this is like top of funnel. This is like day after day after day after day of CNBC coverage and then some CNN coverage and then some 60 minutes coverage and having it actually be positive for once.
It’s a great legitimizing force, right? And also just PayPal saying “We’re embracing Bitcoin as a huge legitimizing force.” And that’s part of this year’s narrative in general is all the legitimization that’s happening from traditional companies entering in the space. And frankly, that is worth so much in and of itself that it doesn’t matter if they just give you a number because you don’t have to go and buy that number there, go buy it in a real place. They’re just going to legitimize the market for us.
And people are going to get frustrated when they try to withdraw their Bitcoin and you know, it’s two K a day or whatever limits they put on it. Selfishly, they’re going to try to keep it in their ecosystem, they’re going to make it hard. And if you store a lot of, Bitcoin exposure on PayPal, it’s going to suck trying to get it off.
Yeah and you can’t even withdraw at this point, right?
You can’t withdraw their Bitcoin, but they’re probably going to even have limits on the amount that you can sell each day, because they’re going to have to hedge that off. And so you’re not going to be able to store your wealth in PayPal.
Right, right. Yeah. Yeah, I’m on the same page there. Novogratz, speaking of, being on CNBC every day. Last week during the pump that’s continuing this week, they had somebody on talking about Bitcoin just about every day. Paul Tudor Jones is on there talking about, and this I love, Michael Saylor also talked about this, that one of the big value props of Bitcoin are bitcoiners, right? Are these people who are passionate, who will, fight for the network. As Michael Saylor says, “fight to the death on behalf of the network,” we saw what happened in 2017 with UASF and kind of proving that out and continues every day on Twitter. Just people really fighting for the network and fighting for Bitcoin as a cause, right? So Paul Tudor Jones called that out, saying he’s even more bullish on Bitcoin than he was when he announced his position earlier this year, Mike Novogratz said that the PayPal thing like Cory was saying was a shot heard around the world on Wall Street.
So there’s no banking institution that can ignore Bitcoin at this point. And maybe there’s no corporation that can ignore the idea of having Bitcoin on their balance sheet now and no person, individuals. So we’re just seeing these dominoes fall. Do you guys have a guess on the next big company, publicly traded company that will buy some Bitcoin of the big names, FAMGA-type companies.
Hey, Facebook’s got a lot of Bitcoiners over there, right? But I don’t know, I think it’s a tough call. I think a lot of it might not be the big companies, right? The big companies are slow to move, right? Despite that we think they’re tech leaders and so on, they are big and they have a lot of money at stake. I actually am very bullish at smaller companies and mid-sized companies coming in and eating up all that Bitcoin while the big ones are asleep at the wheel.
You guys know already I’m super bullish on my first employer. I think Microsoft will do something within the next year. I think it’s just amazing marketing for them. I think Satya took over and pushed open source, open source, open source. They’ve already thrown tons of resources into Bitcoin projects and been very friendly. I think it’s a PR coup for them. And I think it’s probably a net negative for all of the other four.
Or at least causes complications for the other four, I would say.
Yeah, I’d agree with that. I’d say there’s definitely an element of, Bitcoin definitely threatens some of the underlying models and just ideas of some of these corporations, and so they might be slower to get it. But things like Microsoft, Apple, Michael Saylor talks about his ice cube melting, think about how large that ice cube is for them. They see that every single day. And they feel that with the real inflation rates of whatever, up to 10%, that’s real. And so I think it’s going to be increasingly an interesting move. I think people have already seen what it does to the stock alone, I think the position that Square took was made up by the gains in their stock price that very day. And so there seems to be a no lose situation for these companies.
And so maybe next one that has a PR issue that they want to cover up with some big news or getting afraid of that ice cube melting faster than they thought, I think we’re going to see some jump in. But, I like this news stories of the Tahini restaurant, but in their reserve asset. That’s the kind of thing I look at and say, “That’s the Bitcoin I want to see come to fruition.”
I think a lot of this space needs to work at all levels of adoption. We have hedge funds, corporations, blah, blah, blah. We also have Swan and Fold that is really about democratizing access to the little people, the everyday people. And whether that’s your own restaurant that you own, your own family finances, I would love to see that explode. Now, they are going to move the needle a lot less than I think some of these big movers, and I think it’s all good, but I would hate to see these small or midsize companies miss out on this, because I think it will be life-changing for them.
I actually think it’s really great because Bitcoin, due to how the liquidity of it works, right, it’s a lot easier to buy $100 worth of Bitcoin than it is to buy 100 million, right? Like anybody could buy $100 worth. Almost anybody could buy a million dollars worth, you can go on an exchange and do that, but doing a Michael Saylor move requires some gymnastics. So I do think that’s very bullish for smaller companies because they can actually front run some of the bigger ones by starting to acquire Bitcoin. And it’s no big deal for them at their level. And some of the bigger companies are going to have to wait for Bitcoins, depth of market and liquidity to grow over time. I mean, you maybe can buy half a billion, but I don’t know about buying 10 billion for example, right? So it’s a totally different ball game when you get to that size, and that’s great. It lets people accumulate at lower prices and hopefully kind of quote unquote, “redistribute the wealth in a fair way.”
The most asymmetric opportunity in human history. And that goes for individuals and small companies, right? What do you guys think about… Hold on, my notes here. I got distracted by some comments. First of all, in the comments, if you’d like to let us know what companies you think are next. I see some, I see an Amazon. I would like to see some more comments in there about companies that you think are interesting. You want to take a stab at that one, what’s the advantage for small government?
Yeah, sure. I did see. Yeah. Well first, somebody asked about like endowments and pension funds and there is some of that already. There are endowments that have been unfortunately investing in lots of crypto funds, but most of those crypto funds are, 50% Bitcoin anyway. So they are getting some exposure through some of those. I do think you’ll start to see some of the endowments actually seek direct Bitcoin exposure, over the next probably two quarters or so. I think there’s enough CYA, cover your A, out there now with the companies and the PayPal news.…. So I could see that popping off pretty quickly. And we did have a question in there from Bitcoin Diplomat. What would the advantage be for small governments giving up your currency means giving up control? Maybe Yan or Will want to take a pass at that, I definitely have some thoughts.
I could take a high-level pass. I think when we talk about governments giving up control, it’s seldom giving up. It’s usually that the control, they lose control, right? If you go to my Twitter profile, I posted a link from a company called Winton that did research on black market currencies and the country that I’m from, the Soviet Union, in the height of the Soviet Union’s economy, the US dollar was fully illegal, like 100 percent illegal, go to jail illegal. And guess what, like 80 percent of the economy ran on black market money because when you have a dysfunctional currency, the markets run on a black market money and the best black market money is Bitcoin. So, governments may not quote unquote “give up control,” but when your exchange rate is so vastly divorced from the real market rate and people can’t really buy and sell goods in the local currency, because it’s so rapidly devaluing, you don’t give up control.
You just lose control. If you either devalue your currency to officially to match that rate and this is what the research shows has happened over time, they either devalue the currency, or the government falls or one of those things happens, right? The black market always wins, because market always wins. Because people at the end of the day need to buy and sell and trade with each other. And if the currency is non-functional, they’re going to find another way. So I think we’re going to see that kind of thing happen. I don’t know if Bitcoin is ready for, to replace an entire country’s worth of currency action, the Lightning network’s certainly not ready for that. So it’s early, but at the same time, those transactions, just like in the Soviet Union, if you wanted an apartment back in the eighties, you were paying in US dollars, unless you wanted to be on a two year waiting list for one. So you always find a way when there’s necessity.
Yeah. I would say for a lot of these smaller countries, it’s a question of how much control they actually already have today. And I think that’s a question I think we look at a very privileged position about the monetary supremacy of the US dollar. And that is not a position enjoyed by the majority of the world governments. And so while yes, it definitely is, I think Yan’s point governments don’t give up control, they lose control is absolutely true, but also I wouldn’t underestimate that these governments also don’t necessarily have the control that we think they do over their own monetary policy.
That’s right. I mean, people are, people are invading these capital controls left and right. If you, it’s just, that’s just the name of the game.
Yeah. I’ve been listening to macro podcasts as I often do, and one of the things that’s come up a lot in the last, after, the IMF’s sort of hopeful announcement of Bretton Woods two or whatever, they’re going to try to do. Europeans trying to take some power back from the US, basically. One thing that keeps on coming up is having a seat at the table is greatly affected by how much gold you have. So if you have a lot of gold, basically, you have hard money and you’ll have a larger voice at any table if it comes off and there’s some kind of conference or whatever. So that’s what people are kind of speculating on. It’s like, Oh, Germany, they’ll probably carry a little extra weight versus somebody that has completely depleted their gold reserves.
So I think that same game theory and logic plays out for having an even harder asset that’s more liquid. And more scarce in Bitcoin may not play out in the next year, but over the next 10 years, 15 years, 20 years, if you’re going to continue to see government sponsored and backed fractional reserve, fiat currencies, having a decent amount of gold, and having a decent amount of Bitcoin in your reserves is going to give you the right to do that and can make your fiat currency not depreciate so quickly and inflate against these other currencies, the way that it’s happening in Venezuela, Argentina, Turkey, whatever. So I absolutely see, more and more countries over time. You know, I think our new thing should be like when Vanuatu or Bermuda Bahamas whatever was mentioned in the Beach Boys’ song. All the Caribbean islands should just be stacking some sats…
Perhaps you’re making also the case that like, what, what you’re saying is gold gives a country credibility that they’re able to amass as a scarce resource. And it’s kind of like that building of the pyramids that demonstrates your ability to garner those resources, to build something of value. And it’s the same with Bitcoin where you have this hard asset, it’s very difficult to come by. You have to have a mining infrastructure, which is difficult to come by. You have to have very cheap power, which is difficult to come by. All of these things require you to expend real world resources and that demonstrates your credibility as a nation potentially, and may in the future, buy you a seat at that table. It’s also possible that we have countries that still maintain their own currency, but, if their currency is collapsing, they can actually issue a currency against Bitcoin, a digital currency that is real-time auditable.
And you can see, they can show their Bitcoin holdings on chain to all of their people and say, look, this is the Bitcoin we have, this is the currency that’s out there in the world. You can real-time audit the currencies, buy against Bitcoin and you basically back to a gold standard and the government still has control over that currency. They can still print more of it, but now it’s real time auditable against a hard asset. And perhaps that’s what gives them the credibility to restore the functionality of their currency in the near term.
I think Will’s point is the most important here. These countries are already disadvantaged, right? This is the point that I keep going back to by the international Cantillon Effect of the USD, they’re sort of held hostage by it, in a sense. So I think there’s definitely a game theory in favor of smaller countries kind of banding together and creating sort of a Bitcoin trade zone, international Bitcoin trade zone, and being friendly to bitcoiners and Bitcoin companies and getting the first mover advantage on that front. So Yan was talking there and I think he meant on like a country-wide level, Lightning’s not ready. I know that Fold obviously works a lot with Lightning. Will, what’s your take on the state of Lightning and where it’s going?
So I would agree with Yan. We can’t replace Kokomo islands payment processing quite yet with Lightning. But what we are seeing is I think number one exploration of the purpose of Lightning, what is the use case that we are going to see breakout? There are many different versions of how a successful Lightning ecosystem could play out and.
Well, how a light successful lightning ecosystem could play out and we are seeing, just as we talked about Bitcoin, back three, five years ago, there really only exchanges around. And that’s was the entire use case, was this kind of trading thing. Wallets were still pretty primitive. You could hold it, send it and that was pretty much where the infrastructure was. And with Lightning, we are now seeing just an absolute explosion of these use cases, all mining for the product market fit of Lightning. One of them will pop off and it will be different depending on where you are. And so clearly there’s the Lightening as it relates to exchanges. There is lightning as be able to push micro amounts of value. Then there’s Lightning of replacing your visa terminal as a payment processor.
And I think all of those are in various states of development right now but I think the metric to look at is where are people building. And it has some of the best teams building on it right now, experimenting wildly. And what we see, just from what we see on our end, is that it is far easier. So we launched a thing called Lightning Pizza back… a very long time ago, it feels like. I can’t even remember here. And this was essentially… there was no real reason to use the lightning network yet and so we were going to create a reason to; an incentive to use it. So we did Domino’s pizza, integrated it with their POS system so that you can get 10% off every Domino’s order. And that was a reason for being able to jump into the ecosystem and start trying it. Now, we are now seeing that explosion of use cases across many different ones.
And so I think many are in different states, but for Fold, we see a constant increase in our lightning volumes on a monthly basis. It’s still is a very tiny fraction of Folds total volumes. However, it is growing at a rapid… And it’s going to be interesting to see the forcing functions of higher fees, of more congestion on the network, of just simply more friction of using on chain for smaller payments. And so what we’re going to see is either that finds a product market fit and succeeds wildly, or that’s just not the direction that Bitcoin was going. And I think we are seeing very strong signals that there are some emerging use cases there, that will emerge just from the fact of, it’s going to be hard to use Bitcoin when fees are so ridiculously high for normal people.
It will really only be in the hands of people who are moving a ton of value at one time, and lightning network could be that. Just another way of transferring value like we currently do with Bitcoin on chain, but keeps the fees in a reasonable place. So I think it’s very much still an experimental phase, but, for Fold, we are only seeing this volume increase and definitely bullish, especially when you look at all the talent developing in this space.
Yeah. I agree. It’s going to be a necessity thing. It’s one of the aspects. And the other aspect is really just time, right? Because like everything else, it’s going to take way longer than we think. I mean, look at email, it’s like 20 years from when email came out to Gmail and it became usable by the average person. So, there’s always this meme of lightening network, it’s not ready. It’s going to be ready in 18 months. I think it’s going to take 10 years to fully play out like any new technology. Not only is it a technology problem, it’s also a liquidity problem so we need to have people onboarding into lightening over time. And it’s great that we have products like Fold that are doing that. But I think it’s just a time function and adoption function.
And it’s going to be very gradually then suddenly. And it also could be that the use cases that we laid out, aren’t even the ones that drive it, right. It’s like corporate adoption happened with Bitcoin and kind of came out of left field. Maybe there’s some lightening thing that we… None of us thought of at all. And it’s just going to emerge out of left field, it’s going to take over. So all of those things are possible. I agree. Lightening is very bullish. I think it’s a really great technology and my comments were really just the realistic comments of like, it cannot sustain the liquidity required for a country’s worth of an economy today. That’s just the facts, but I’m still very bullish on Lightning.
Yeah, for sure. First of all guys, we have 133 people watching, 43 likes. So let’s get that up above a hundred. It will help with discovery after this live stream is over. We want to get it into more people’s feeds so appreciate that if you can smash that like button for us and subscribe if you’re not already. Let’s wrap up with a couple of kind of quick questions you guys can go around and answer. One price, we want to just get price predictions. I think we kind of already did this, but let’s do it again. We had a request for it in chat. The 13, eight resistance level, what happens after that? What happens after we break the all time high? What happens after we break the one trillion dollar market cap? How high are we going to go? And the final question is, what do you think we’re going to hear on the micro strategy earnings call today, shareholders call today?
First of all, thank you for the leading questions Brady. Fantastic. Great. I think the answers were in the questions.
Sorry. I couldn’t help myself.
The answer to both questions is moon. Right. I don’t know. I love to be the conservative one because then I’d like… I just really enjoy being wrong. Right? I just want to be like, “No, we’re going back down to 10K, it’s going to be a nightmare, everybody’s going to cry.” But you know what, here’s the thing, 10K is 10 times higher than we were like three years ago. So what are we even talking about? We’re going to go up, but it’s going to take a long time. I think this is going to be pretty choppy. So who knows? I don’t know, man. I don’t trade. I just stack sats. This is why I don’t comment on price.
I’m with you Yan. I know the most boring answer, but I think there is a thing once you’ve been around for awhile, for when price goes up, it actually makes you a little bit sad and when price goes down, it makes you extremely excited. So I feel like I’m reversed to someone new coming in here and saying, “Let’s get this number going up.” And so I do think that there is a great irrationality in FOMO that will happen once we break any of these price resistance, 13, eight, 20. It is just something seared in the memory of everybody around. So all of us here have a ton of friends who are probably texting you now about what they should do about their Bitcoin. But also we’re the ones saying, “Hey. How long has it been since it was at 20K?”
And this is just a thing that like… everyone knows Bitcoin in their household and a lot of them know that it was at 20K at one point or right around there. That is going to be a psychological barrier. Just like there was that moment with Bitcoin insiders when it achieved dollar parody. I still think of that as such an incredible moment to happen where Bitcoin, is worth a dollar now. And it seems like this, “Holy shit, this is like a moment of money.” It’s arbitrary. It’s totally arbitrary moment. But I think there’s something that happens with these psychological things.
Bitcoin is social technology to a big… to a very large extent. And big movements in that way will have, I think, pretty crazy effects on how people start to think about in their mind and that 50% of… 55% investors who want to allocate into Bitcoin, who haven’t yet, they’re going to do it when it hits 20 and they’re going to be a little late. They’re going to be later than they wanted to. But I think that is going to be a switch that goes on in a very broad way.
Great. So we didn’t build Swan to have to have these conversations, but now we actually have to have these conversations because we sort of quietly rolled out something called Swan private so we have a lot of high net worth individuals wiring large chunks of money now and asking Yan and I, and sometimes Reed, how should I deploy this? So we’re kind of, we always say, Swan and shell and just dollar cost average in or whatever. But the view that I’ve always had long before we even started this product was really in line with what Brekkie flashed up on the screen, which is the more you understand Bitcoin, the more likely you are to buy. So if you have a big chunk of Fiat and you have conviction, and you’re dealing with an asset that has upward skewed volatility, look for a good entry point.
Buy something right away, and maybe take your whole pie. I’m dealing with this literally right now, because one of my brother’s best friends, who I’ve known since I was zero, is a successful guy up in Seattle and sent us a big chunk of money and he’s asking me how to deploy this thing. And I’m saying like, ” Okay, so take the pie. Put some in now, right now, just so that you know you have some. Call it 20, 25% of that stack. And then just dollar cost average every day, with call it like 50% of it. Just kind of have that allotted to just buy in, over the next month or two months, or whatever. And then if there’s a dip, just plow it all back in, and just get it over with.”
And then as Fiat comes in over time, then that’s what Swan is really for, which is converting the money that you earn over time, kind of matching your contribution into Bitcoin with the money that comes in. That’s really what it’s for. I know I personally can’t really sleep in Fiat. So usually when I get a chunk of Fiat comes in from one of my startups, selling and I get to cash out a little bit or whatever, it’s very hard for me to dollar cost average that in over any long period of time. I usually just want it all in Bitcoin so I can sleep better.
That melting ice cube.
Man, it’s rough, it’s rough. But we still do deserve a little price chat. God, it’s so hard because there’s so much volatility heading into the US election next week. But my guess is we don’t punch through 13, eight between now and Tuesday, and I think that there’s a very good chance of a lot of things going sideways down in the market next week. So what I did advise my brother’s buddy to do is, to buy some now, just in case it moons tomorrow and otherwise just kind of bide your time because I think there’s a fairly good chance of being able to pick up some cheap next week, but we’ll see.
What are you guys’ thoughts on Bitcoin kind of rallying during the midst of a stock market sell off?
Great, great time.
Great? I’m not as bullish on this great decoupling that people are talking about, that stocks and Bitcoiners is going to fully decouple. I think there’s a lot of psychology here. I mean, people point to the coronavirus crash and say, “Look, everything crashed at once. Everything’s down. The US dollar, the stocks are down, the Bitcoin’s down, and that means it’s correlated.” It’s like, it’s a very small market. And yeah, the most people are that are playing it, are like US investors with money so they’re just kind of market selling everything when the panic comes because they know everybody else is panicking.
So yeah, it happens. I think it’s a bullish sign that it is decoupled right now, but I’m not betting the farm on that lasting forever. I think again, Bitcoin, if anything we’ve learned on Twitter is, Bitcoin destroys all models, right? Michael Saylor’s comment. Thank you, Michael Saylor for the greatest themes of all time. But it does. It really does. It doesn’t care about your models. It doesn’t care about your correlations. It’ll just make crazy moves once in awhile because it’s so supply constrained so I need real move in the market is going to be reflected. So it’ll do things and it will destroy your model, so tread carefully.
What happens if 10 billionaires come in, buy a billion dollars each, declare it, say they’re not afraid of it or not scared to declare it, and then they start buying more. All your models are destroyed.
It’s very game theoretically true, right? Here’s the interesting thing, right? Michael Saylor makes his big bet on Bitcoin, 500 million dollars. Now he has to actually defend it. He’s going on all the pods, he’s going full on the memes, and he has to defend it, right? And all that he’s doing is creating more and more bullish price action, which is driving more people to put money in and then those people have to go out and defend it. Once you have money in, you’ve got to defend it. And then that forces you to get educated. It forces you to really understand it. And then you showing it to all your friends because now you’re fully orange pilled, and then yes, all your models are destroyed.
And then you end up spending every spare brain cycle that you have on Bitcoin and then working full-time in Bitcoin
It’s a disease. It’s a virus
This is how it happens. All right. So now that we’re talking about Michael Saylor, lets finish up with this one question, just kind of go around the horn. What are we going to hear. This micro-strategy earnings call is very interesting one. It’s going to be a very special one in the history of that company, for sure. Their treasury investment is up four X annual earnings. Like you said, Michael sailors out there making the rounds and selling the Bitcoin. He’s going to have a lot of attention on this call. What are we going to hear?
How you like them apples. I told you so.
I want to hear a shout out to the Cyber Hornets, I think, would be a great call. I just know that there’s a lot of people who probably weren’t on board with that decision in this company. And I’d want that moment to sink in with them, see how they respond. And I hope he’s humble about the thing and I think he has to right now. I think we are… it breaks all models. We don’t know what’s going to happen tomorrow. And he’s in it for the long haul. So, he’s in if it goes down. He’s there. And I think a moment, it has to be an artful gloat, I would say, to do it right, to hedge against where it could go because I think he’s got strong hands. And I think him doing this in the right way, the right amount of gloat, would be even more a testament to that, he’s in it for the long haul because he knows it’s not going to always going to be simple.
Yeah. And what’s interesting is that his stock has not yet broken the pre Corona crash highs, as far as I can tell. I am not a stock chart expert, but if I draw that line, it looks like it’s just about there. And that’s a little surprising to me because if people thought the company was worth at that amount, prior to the Corona crash and now we’re back, and now the coin’s pumping. I think we could see some pretty bullish action on the stock just on the story alone.
Totally. Absolutely. All right, gents. Any closing thoughts? Fold app, fold cards coming soon. Will, you want to just say a few sentences about the fold card and where people can sign up to get it?
Yeah, I would say we are about to release a sat stacking machine. The entire team created this to actually implement their wildest ideas of, how we could make sure that all of everyone, if they have a position now or don’t, or want to increase it, that this card is going to be meaningfully add to that stack and do it every single day. I think I really see DCA and this, as two really powerful concepts together. And so I think you should get on this wait list.
There’s a big line, but we’re actually rolling this out in November and in December. We’re going to get to you very quickly. So sign up for Fold’s card at fold app dot com, slash card. Get on the wait list. We’ll get to you soon, but this is going to be a fun ride. We’re building this out in the open. We have about a couple thousand people who are on the early access list and this thing is going to be built in real time. We’re just going to field new features from this group. We’re going to add it in and so I’m really very bullish on coming out with a card, right at a great time to soak up all of these new entrants who are excited to start getting involved.
Cory. Talk to us about Swan for a little bit.
We just get to like show Swan at the end. I love it.
Yeah. It’s our show.
It’s our show. Okay. Cool. Right. Okay, cool. Well, like daily buys just a normal thing now and it’s just awesome. I love stacking daily and not even thinking about it. But there was still like that weird anticipation with the weekly, like wondering if your buy was going to happen at the right time or something. So if you’re on Swan, or thinking about getting on Swan, definitely go and sign up for daily. I think it’s Swan Bitcoin dot com slash daily buys. And everybody will be able to sign up within a week or two. I think we’ll be through the beta signups and everything’s gone well, I think. So it should be open to everybody soon. What else is really awesome. So just coming down the pipeline, we’ve talked about spot buys, smash buys, market buys, whatever you want to call it.
Anyway, one time purchases. That is coming very soon. Yan, it’s tomorrow, right? No, I’m just kidding.
I’ll just stay up all night. It’ll be fine.
It’s fine. It’s fine. No QA needed for that one, right?
No, we just ship a lot. We do everything live, so it’s all good.
Yeah. Put it on a server. It’s all good. So I think we’ll actually probably roll out like a beta sign up for that later this week as well so all the early folks can get in there and be the first people to smash buys. So that should be pretty awesome. We also have a membership coming out, which you think is going to be really great. So we’ve been really thinking hard about what makes sense for Swan to deliver and as usual it’s going to be a lot of educational stuff. So we’ll have more on that pretty soon.
What else is kind of interesting? You’re going to start to see Swan show up in other apps soon, so sort of a powered by Swan experience. We’ll be going live in not the too distant future with some wallets and other apps out there that will be letting you buy through Swan right from their interface. So that should be pretty neat. What else? Brady, you want to talk about Swan lounge?
Oh, wires. Yes. That’s good. Treasury private.
If you want a wire funds to your Swan accounts, just contact us at support at swam bitcoin dot com, and we will take care of you.
Yes. We’ve got take wires up to a billion dollars. So if you want to wire us a billion dollars, the whole company will pretty much just figure out how to execute that with an OTC desk. So, send us a billion dollars. We’re in.
Brekkie, you want to pop on real quick? Hey, how’s it going?
Brekkie Von Bitcoin:
Ladies and germs, I’ll do my quick shill. Sorry. I don’t have my makeup on. We’re going to talk about a couple of things. The Bitcoin arsenal. That’s why I’m wearing this silly hat with open dimes on it. What is the Bitcoin arsenal? The Bitcoin arsenal is where we’ve got all the Bitcoin memes. And I mean all of them, not yet, but soon we’re adding them. We’ve got some amazing pages for some dedicated memers. All right. The hat’s coming off, it’s uncomfortable. And you can pick up the arsenal at Swan bitcoin dot com slash arsenal. Follow us on Twitter at Bitcoin underscore arsenal. We retweet Bitcoin memes so tag us at Bitcoin underscore arsenal. We retweet all the best memes.
Follow us for updates. One more thing. Know our show, you love our show. But Fridays we have Swan lounge, which is an entirely different show. It’s more laid back. It’s kind of like how the end of this show was. It’s Bitcoiners hanging out and talking. This week, excited to announce we’re going to have Nico and Phil on from Simply Bitcoin. If I screwed that up, sorry guys. It’s going to be great so tune in this Friday.
All right. Swan lounge is a lot of fun. So subscribe to this channel, love to see the subs going up. The uptake on the channel is really exciting. Really appreciate you guys being here and supporting the channel and our shows because we have a lot of fun doing them and glad to know that they’re useful. So that’s it for this week. Take care, everyone. We’ll see you next week. We’ve got a special election edition and I’ll announce it after the show, but I’ll let you guys know now, it’s with Alex Gladstine and Marty Bents. We’re going to get into the history of this country and talk about how Bitcoin will hopefully be a new revolution like we experienced in 1776, the separation of money and state, et cetera. So that’s going to be a really exciting one. I think it’s going to get deep. I think it’s going to get inspiring on a day where I think we’ll all need a little bit of inspiration. So next Tuesday, election day, Marty Bent and Alex Gladstine. Be sure to tune in for that one. All right. Thanks everyone. Take care.
Episode 8 –Andy Edstrom and Ansel Linder
Episode 9 –Rockstar Developer and Jeremy Rubin
Episode 10 – Bitcoin TINA and CK Snarks
Episode 11– Gigi and Knut Svanholm
Episode 12 –Adam Back and Preston Pysh
Episode 13 –Alex Gladstein and Matt Odell
Episode 14 –Robert Breedlove and Tuur Demeester
Episode 15 –Isaiah Jackson and Max Keiser
Episode 16 –Gigi and Udi Wertheimer
Episode 17 –Aleks Svetski and Jimmy Song
Episode 18 –Stephan Livera and Marty Bent
Episode 19 –Mark Moss and Ben Prentice
Episode 20 –Samson Mow and Parker Lewis
Episode 21–Lyn Alden and Jeff Booth
Episode 22– Robert Breedlove and Cory Klippsten
Episode 23 — Saifedean Ammous and George Gammon
Episode 24 –Jameson Lopp and Eric Martindale
Episode 25 –Preston Pysh and Andy Edstrom
Episode 26 –Lyn Alden and Nic Carter
Episode 27 — Erik Townsend and Yan Pritzker
Episode 28 — Max Keiser and Tone Vays
Episode 29 –Preston Pysh and Andy Edstrom
Episode 30–Raoul Pal and Vijay Boyapati
Episode 31–Dan Tapiero and Dan Matuszewski
Episode 32–Robert Breedlove and Parker Lewis
Episode 33– Danielle DiMartino Booth and Michael Saylor
Episode 34– Jeff Deist and Stephan Livera
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