Why Bitcoin: Michael Saylor Interview - #Bitcoin #LostCoins $MSTR #Future #Math Education + more

hey everybody

this is a long video one i've been

looking forward to for quite some time

with one of my heroes michael saylor

we're gonna cover a lot of ground we're

gonna talk about

giving back to bitcoin to investing to

the markets to the great reset and a ton

of other material

i know many of you may not have an hour

and a half to look at it all but

detailed chapters are below

hope you like it enjoy let's go i'll do

a very brief intro everybody kind of

knows who you are but

let's see how this goes and i'm very

very excited so first of all um we

should be on gallery view

everybody i would like to introduce

michael saylor this is a man who is very

special

i've been tracking him for nearly 15

years due to some of my history

mr sailor knew what business

intelligence was before anybody even

knew what it was he's a visionary mit

grad he knew mobile was the future again

before anybody else knew what it was and

he has this uncanny ability to weave

together the best metaphors on earth in

my opinion he's been the ceo of

microstrategy since the late 80s and

i've been again following him for a long

time in fact my youtube channel actually

became famous because of microstrategy

and i

identified what he was doing and felt

everyone needs to get their hands on the

stock so the rest is history and that

all happened late 2020 and now we have

thousands of viewers that are

microstrategy shareholders either in

their isas in the uk or iras in the u.s

or the brokerage accounts all over the

world so

big thank you for being here mr

sailor happy to be here james okay this

is going to be an interesting

conversation we're going to go fast

we're going to cover a lot of cool

ground but first of all i have a little

treat for you

and i'm going to share something with

you just as a little surprise as you

know a big part of this channel is

really to give back and

i know you are a nautical person to some

extent

and we contribute a lot of money we make

to back to nature and children's

hospitals and stuff so we adopted a

whale this is the second last one

available we named him sailor

and

this is part of uh

the oceanic society that helps keep our

ocean safe clean free from plastic

protect wildlife and it tracks sailor a

humpback whale and cedar likes to float

between the oregon coast and the gulf of

mexico believe it or not and spends a

lot of time hanging out at the farallon

islands which is not far from where i am

a lot of the time so

sailor is yours i hope i hope you like

that i hope you don't mind

so that's awesome

i might need to track sailor of the

whale

exactly well you are a whale yourself

so it might be hard to keep up with

we'll see

exactly so again let's uh jump in i'll

start at the beginning um first of all

i'm not going to talk about

adiabatic processes which i know are

near and dear to your heart but we will

talk about your view of the world so

with your book the mobile wave you

nailed the future of technology 10 years

ago

and

it was uncanny how you did i remember

one of the the key things you you

equated

uh

comp pcs

to

a solid

laptops to a liquid and mobile to a gas

now i that really resonated with me a

decade ago and i thought wow the future

is mobile the future search etc but do

you believe you have nailed the next big

thing as in bitcoin

like you were really the first to spot

the mobile wave wow you think bitcoin is

the next technology wave satoshi nailed

it with the help of a bunch of you know

cyberpunks um so

i watched it for 10 years but i was

really focused i think the last decade

was the mobile wave for me and i was

focused on

digital transformations

of in the first era i almost feel like

there's

there's one segment of the mobile wave

which is uh the digital transformation

of music and books

and communications and relationships and

retail

and that describes the rise of youtube

and google and facebook and amazon and

apple

and i think the second stage

of the mobile wave is digital

transformation of money

the you know digital transformation of

property digital property

digital money digital assets

and ultimately i think i think the the

most theoretically pure

you know metaphor here is digital energy

and uh i i think of course that second

that second uh

epic of the mobile wave is got to be 10x

bigger an order of magnitude bigger than

the first epic

because if you ask anybody you know what

what's the value of having all your

movies and all your photographs and all

your books and all your documents on

your iphone

that's i guess it's a decent amount it's

enough to make apple a two trillion

dollar company but then if you asked

what's the value of all your property

and all your money

and all your wealth what if that was on

your iphone

and yeah what would apple be worth then

if all the property

and all the money

in the world was stored

on an iphone or an android phone and i

know it's a it's a little bit limiting

to just talk about them but but mobile

devices are so ubiquitous and i think

it's inevitable that 8 billion people on

the planet will all have at least one

mobile device and it'll be the

primary device they use to manipulate

software and

what could be more powerful software

than than software that moves energy or

property or money

your world's collided then

your mobile world with your digital

world smashed together is that fair to

say

i think so

awesome so when when did

when did the penny drop for you

for bitcoin to invest and i know you you

know an awful lot about finance and

economics and bonds and treasuries and

everything else but when was the like

the aha moment when the penny dropped

i think it's um

march

of 2020.

i if you look at um

the thing that's so difficult to grasp

about bitcoin

as a digital transformation is

is

it's it's a complete paradigm shift in

your view of

money

property and energy

and

and uh

you know when when you have something

which totally transforms your world it

takes a while to give up the old world

so

just about every company on earth has a

balance sheet and every fam you know a

conventional family a conventional

company a conservatively run

organization runs on a balance sheet of

cash and credit

most central banks have cash and credit

a long time ago people had some gold on

their balance sheet but gold it probably

peaked 1914

and it disappeared and then what you saw

was

companies running treasuries with cash

and a lot of credit and the credit is

short term sovereign debt

or other high you know triple a rated

credit instruments

and and the way you ran a business was

you're either a finance company a wall

street company and you and you can't

really invest in cash

maybe you invest in credit fixed income

you're either credit or you're or you

invest in equity

and then if you're an operating company

like a software company

you hold your treasury in cash and short

dated sovereign debt and that's just the

way it was for 30 40 years and you were

doing that for nearly 30 years yourself

within microstrategy that's how we were

in our company but through the decade

from 2010 to 2020

it got harder and harder

for us to to grow the company

and

we were generating a lot of cash but

somehow the stock got mired

and and you know if you have a bunch of

cash and it's generating five percent

interest

and someone told you the inflation rate

was two percent you might think that

sort of you're getting ahead

but when when interest rates went to

zero percent

i think the first shoe to drop was

interest rates are zero or that's not

good the second the second uh knock was

they're gonna stay at zero for four

years

okay there's no hope of generating

interest on cash and credit

well that caused me to stop and say well

how bad is it

okay well the how about it how bad is it

it depends upon your definition of

inflation

so

i believe there's two inflation rates

there's inflation rate if you want to be

poor or there's an inflation rate if you

want to be rich

and the inflation rate if you want to be

poor is the cpi

or pce it's a it's like a market basket

of goods and services that don't include

the highly volatile energy and food and

they don't include housing and they

don't include college education and they

don't include stocks and bonds in early

retirement

and things like an art

so

that inflation rate is preached so often

that i think the entire population just

kind of internalized and says okay i

guess inflation is less than two percent

interest is zero percent i get a

negative real yield of minus two percent

i have 35 years i lose half my money

well i mean if you believe that then

then of course

it's a bad thing but it's not a it's not

a horrific thing but i i think sometime

sometime after the interest rates pegged

at zero i started thinking about

inflation

and i i saw inflation from the point of

view of ceo

if half your market cap was cash

and you went to an investor the investor

would have said hey look um we got 25

return last year on the s p 500 you're

getting zero percent return

that's a 25 cost to capital you're

burning if you have a billion dollars

you're burning 250 million dollars in 12

months

you're burning 20 million dollars a

month

okay so give it back to us so that so

the institutional investor would say to

the ceo

you know you're irresponsible to hold a

balance sheet of cash and credit give us

the money back

okay so now you're called between a rock

and a hard place you're going to give

the money back and be decapitalized

or you have to invest it in something

that's going to go up 24 a year

now and that takes you down this rabbit

hole

it turns out if you're an operating

company

and you want to invest in something

that's going to go up 24 a year uh

you and you buy a package of securities

you run into the sec 40 act and the sec

40 act caps you out at 40 of your assets

so if you had a billion dollars in

assets you couldn't hold more than 400

million dollars worth of s p indexes or

companies

okay so what do you do with the other

600 million dollars

exactly so so that now that you're here

and again we've got a lot of

microstrategy shareholders in the office

and you have

last last calculation was over seven

billion dollars in bitcoin

uh which at one stage i think yesterday

the day before that nearly exceeded the

market cap of microstrategy which means

it's uh

microstrategy's trading at a big

discount but what do you see as your

single biggest concern or risk for

bitcoin if anything like what really

keeps you a week awake at night now that

you're you've got such a basket of

bitcoin which we'll talk about in a

minute as to what that means in terms of

global share of bitcoin but by my

calculations you own now more than one

percent of all bitcoin on earth

i think uh bitcoins cross the event

horizon so it's going to be successful

um

[Music]

and uh i think that in the near term

i mean the only mistake you can make is

get levered 20 to one

long with a force liquidation on

volatility right yeah if you if you have

some kind of extremely levered position

and you could be forced liquidated maybe

you have a problem but if you have uh

permanent capital

then the real question is just at what

rate is it going to move up and what

kind of volatility will we have

i think that um

the major test

the major tests were it was the growth

was accelerated by march 2020 and the

covid pandemic response i i feel like

that

that combined with

if you look at the federal reserve they

went from inflating the money supply at

seven percent a year to inflating the

money supply 21 a year so if we when we

went from seven percent monetary

inflation to 21 monetary inflation in

the western world that was like pouring

gasoline on the fire right and then i

think that the election

if you recall i think bitcoin on

november it was trading 13 000

it was trading in the teens

the election was a big event

and the the incoming administration i

think a it it

uh it created some clarity about what

will happen in our monetary policy over

the next four years maybe the next eight

years

but b

it brought in a set of regulators that

are fairly progressive and and uh

you know gary gensler taught the class

at mit

so he spent three years studying this

and if you if you parse all the um all

the testimony of uh janet yellen and

gary gensler

your conclusion

is um that election brought in a

progressive set of regulators

that are that are that view satoshi's

innovation as real

and that think that bitcoin is a key uh

a key platform upon which to build a

21st century economy

and then the third

the third maturing event is the china

crackdown

because the the major fudd was well

china controls the majority of the hash

rate

and maybe this is a chinese thing and

and since china and the us are kind of

at odds over geopolitical agendas then

do we trust it and that the chinese if

they control 50 or more of the mining

industry that was a 20 billion dollar a

year industry they had half of it and it

was doubling every year and they

unilaterally exited the entire market

which meant that

all the mining rigs got shipped to the

west

the beneficiaries were well capitalized

north american bitcoin miners

uh all the chinese holders dumped their

bitcoin you know we picked up

500 million dollars of bitcoin in the

mid 30s another 450 million dollars of

bitcoin in the mid 40s

i would have been buying that stuff at

75 000

85 000

etc so the way i look at it is it was

about a billion dollar windfall half a

billion to a billion dollar windfall

just for our company

it was a mega windfall a 10 billion

dollar x 20 50 100 billion dollar

windfall for bitcoin miners in north

america

it's a trillion dollar geopolitical

mistake for china they won't figure it

out just how bad it is for about five

years

but as we look back at the end of the

decade and you calculate that it'll be

big but now back to your issue so what's

the threat to bitcoin

well bitcoin survived the pandemic

it institutionalized when microstrategy

bought bitcoin there were no publicly

com publicly traded companies holding it

now you have square and tesla and

marathon and microstrategy and 24 other

companies and 12 public bitcoin miners

and etfs okay so it institutionalized

it nationalized it westernized

right you have a world of six billion

people relying upon the western

technology stack which is the which is

the english language the u.s currency

western law

google apple amazon facebook

bitcoin

twitter

and then you have the eastern bloc which

sits on the chinese language the cny

and the stack of chinese

technology companies

and the like and you you can see that

power dynamic

and it was very important that bitcoin

slide in as the monetary protocol for

the west

and not be deemed as the monetary

protocol for the east yeah that's funny

because i always have a theory that you

know

nearly leaning into things like possible

black swan events i believe that if

there is a world war three heaven forbid

there is but if there is it's gonna be

digital in nature

and there's gonna be three underpinnings

of that world war three three currencies

it's gonna be the dollar reserve

currency of the world it's gonna be the

digital one

and then bitcoin so how have you ever

thought about the geopolitical nature of

how this could all shake out with these

underpinnings

and leaving in a black swan potential

i think that uh

that bitcoin is like that

universal digital property

right and i do agree if you look at the

if you look at the future of the world

and and how the mobile wave plays out

after we finish uploading our photos and

our relationships and our documents and

our books and our videos and our

whatevers to our phones

we upload our money and you'll have

eight billion people on the planet

and you'll have eight billion digital

wallets and they'll be sitting on

android and ios and maybe they'll be you

know the chinese the you know a chinese

operating system

and

that digital wallet will hold a mixture

of currencies and

assets

and or you can call them currencies and

properties if you wish but

the current the strongest currency of

the us dollar

and then the cny and then and and then

you'll have you'll have maybe a dozen

two dozen

the yen the euro you know if you have a

strong government

wherever there's a strong governmental

influence they will dictate a currency

which will be the medium of exchange

because you're going to use to pay your

taxes and it'll be the stable coin if

you will and the chinese have shown they

have the power to endorse the cny and

the u.s has the power to drive usd

um the weak currencies

there are 66 of them already gone

i don't they're 190 countries in the

world 66 are dollarized

66 and so there's another 66 that will

probably dollarize

maybe there'll be 10 that will go cny

right and then you'll see two dozen

you know i mean i think the japanese

will keep there again i mean i think the

europeans will keep their euro i mean if

the european union breaks up

then the euro collapses and then they'll

dollarize right and then you think of

england as an outlier then as well i

know what will happen to those guys

and you know venezuela they've already

lost i mean no one takes the boulevard

seriously

so

i yeah imagine you live in

argentina

you know you you've got like the peso

for when the government says you got to

pay it you got the dollar for when you

want to buy anything internationally

and then you've got the bitcoin

and and if i was smart

i would have one month of of expenses in

the strongest currency

one day of expenses in the weakest

currency

and the rest of my life my life savings

in the asset and bitcoin is the

strongest asset

now there may be other assets maybe

they'll tokenize the s p index so

they'll tokenize you know french stock

exchange companies or they'll tokenize

other forms of property

but

i think what's pretty clear is for the 6

billion people in the western world

the dollar will rise to the top is the

medium of exchange and the and the

bitcoin will rise to the top as the

store of value

and

that's it's a logical

stable point because you can trade

dollars with anybody in the world

everybody's built dollars into their

retail systems and there's no taxable

event

right so there's no there's no tax issue

of sending you know sending you money or

receiving money from you i think and

also dollars are depreciating at 15 20 a

year

right and we can debate whether it will

go back to seven percent or it'll say a

15 or 20 or 25 who knows but but dollars

are losing value at one to two percent a

month

bitcoin's accreting in value

and pesos are losing value at three or

four percent a month

the news today about turkish lira it's

you know it's collapsing it's certainly

double the rate of the dollar

and the boulevard is collapsing at four

percent five percent a month have you

thought about the conversion of

you know from the petrodollar to what i

call

the petro bitcoin if there is such a

thing uh like if you look at what iran

is doing what russia wants to do get off

the dollar et cetera do you believe

there will be a movement towards

denominating energy in bitcoin or some

other type of crypto or cbdc down the

line

ah it's interesting subject i mean i

i feel like

i mean there's a it's back to this

general idea of well are you gonna sell

teslas for bitcoin or not are you gonna

sell whatever you sell for bitcoin it

it's it captures the imagination of a

lot of people and from a marketing point

of view it generates a lot of sparks and

excitement

but

it seems to me like a better idea would

be

instead of trying to sell you a barrel

of oil for bitcoin

a better idea would be

take all my money

and buy bitcoin

like convert your entire balance sheet

to bitcoin right

for you know if you have 50 billion

dollars and it's

and it's sitting in dollars and

sovereign debt

i think the bigger idea will be what

happens when i take 100 billion dollars

of debt credit instruments and i sell it

for dollars and i take the dollars and i

swap them for bitcoin and i put

a hundred billion dollars of bitcoin on

my balance sheet

so

i think it's

it's it's pretty clear that bitcoin is

the universal monetary standard

about it's the universal store of value

but the issue is not really whether

people trade in dollars

the issue is how long do you hold the

dollars

right if if you sell me if you're gonna

sell me something

four million dollars

and i give you a million dollars and you

convert the million dollars into bitcoin

into 20 bitcoin

one minute later

then that was smart

and if you held a million dollars that

was stupid and if you held a million

dollars and invested in debt yielding

three percent interest while the

purchasing power of the dollar is losing

20 a year and you're minus 17 and you

held that for a decade that was unwise

right but the real question is how do

you manage your treasury everybody has

the ability

to manage their treasury and swap it

into hard assets if they wish to do so

i think in

in the next decade

it seems pretty clear like

why why fight the fed and like if i was

in china i would be buying and selling

and seeing why i'm not going to lay down

in front of that tank

i'm going to sell in that local currency

and then my issue is i'm going to want

to save in the highest form of property

and if i'm in if i'm dealing in the

western world the path of least

resistance that results in the best the

best outcome

is

as long as there is a functional

government in your mercantile sphere of

influence you should trade in the

currency of the functional government

if the entire government of zimbabwe

collapses

i trade in dollars

and and if no one takes dollars anymore

then i'll trade in sets

but i don't

i don't think we're getting there this

decade right so

so like anything could happen 20 30 40

50 years out

but i kind of feel like as long as there

are governmental entities

they're going to create their own

currencies

and you know if when the boulevard

collapses they'll create the new

boulevard

and the peso collapses they'll create

the new peso and at some point

people in the country will fight between

do i want the peso or the us dollar and

i i don't a lot of times people in the

bitcoin world feel like they need to

wade into that i don't think we need to

i think we can just

we're getting distracted by the question

of whether we should champion the peso

the boulevard or the dollar in in latin

america i think that the bigger question

is how do i have 100 of my balance sheet

in an asset that's appreciating

microstrategy by the way is

500 of our balance sheet isn't an asset

that's appreciated right we started with

500 million in in equity

and now we have seven billion in assets

right so

like it's not like five percent it's

like a hundred percent well maybe it's

200

if you're a wealthy person the strategy

would be

the strategy would be to borrow a

billion dollars

by 1.1 billion dollars

worth of property put up 100 million in

equity and and in essence you have one

thousand percent of your balance sheet

in property and then hope that the money

supply expands ten percent a year

because if it expands ten percent a year

you're going to make 100 million a year

in investment income and in 10 years

you'll have about 2.4 billion dollars in

property 1 billion dollars in debt with

accrued interest at 3 4 5 interest and

then you'll refinance the entire

building

and take out 500 million dollars at

three percent interest tax-free

right it's a property development

strategy right and anybody can do it

anywhere well i've got a model i'm

working on actually that looks at

forecasting the money supply expansion

and the debasement of the currency and

the future value of things like bitcoin

versus real estate etc i'll share it

with you because i know that is near and

dear to your heart but switching gears

for a second getting back to satoshi's

and why we are talking together is i got

your attention i am fascinated by supply

i fell in love with bitcoin in 2017

because of its completely scant scarce

supply

and not only that but the fact what

really fascinated me was the fact that

it was being lost and and in my

community i am on the receiving end of

an email at least once or twice a week

where people lose their seat phrase

where they ship bitcoin to the wrong

wallet lose it forever or a million

different reasons i'm not going to go

into those as well but i do want to talk

about supply and what you think of this

everybody talks about 21 million bitcoin

i have it on good account and authority

and i've been studying these numbers for

over

four years now i have a detailed list of

all the coins that i we know of that are

lost

and we have companies like new york

times and fortune magazine that estimate

between 3.7 million and four million are

definitely lost this is the satoshi lock

up 1.04 million there's people you know

tragic situations like mr pobescu who

drowned with 125 000 bitcoin instead

which is very equivalent to how much

microstrategy hold so you know the value

of that so the total lost to date or

irretrievable or gone forever is say

4.865 million bitcoin the mine today is

18.85 call it so the net balance is just

shy of 14 million but the real tragedy

is this

now

a lot of people believe like kane

research believe four percent of bitcoin

are lost per year i believe that's very

possible but i believe it's going to go

down over time so

using the kane digital research number

of four percent loss per year we could

fall down by the year 2048 that's as far

as i could go out to fit on the screen

but it goes out to 2140 if anybody's

interested in seeing this

we could have less than say 7 million

bitcoins in supply

20 30 years from now now if you assume

just one percent loss per annum and you

know when you p when you see people

going into supermarkets and they're

buying bitcoin from an atm they got a

piece of paper

you know you know a lot's gonna be lost

you know people that are stricken by

illness or car accidents or fall off a

skateboard or a windsurfer

or

you know whatever the circumstance

they lose it too um so just assuming the

one percent loss that would take us down

to about 12 and a half million so my

theory is we will never have more than

14 million bitcoin

and as a result of that by my math as

well

microstrategy

and you and your organization you own

over one percent of all bitcoin now my

big question is first of all do you

believe in that and second of all do you

believe other treasuries are a little

bit scared off because

you know mr sailor went in there and he

bought all the toys we don't want to

play that game or do you think they

don't care or do you think there's

enough supply for everybody

well um so

i'm i'm uh intrigued by your analysis

uh

the biggest the biggest question mark is

that and i buy into everything every

line item there the 3.7 million lost

coins

right that if it doesn't include satoshi

right then just getting your hand around

is that 3.7 or 2.7 would be my big

question i don't i haven't studied that

but i'm persuaded that you're right uh

you know within uh within the error

within the margin of error

and um

[Music]

we know the water law so it's just

really just a question of is that 3.7

million the number that's lost i agree

it's a deflationary currency and i i

expect it it's inevitable that more will

be lost

it's occurred to me by the way

that the ultimate act of charity

is to die with your private keys

and lose them

like if you're asking the question how

could i make a charitable contribution

to the human race

in a fair

responsible fashion such that the money

would be

put to good use

you know if you believe the market is

smarter than any individual and if you

if you believe in the natural order of

things and if you really believe in

bitcoin

then it's likely that the some entirety

of the world and all bitcoiners are

probably

smarter about using the world's

resources than you will be in your will

so if you simply died and buried your

keys

you know either accidentally or just

inevitably

then you'd be making a contribution to

everybody else in the entire network pro

rata

pretty fairly and then they would have

the benefit of that economic energy to

do whatever they felt was the

appropriate thing for the good of the

human race going forward so

i i'm fine with it i

i agree it doesn't really matter

to the success of bitcoin whether we

terminated 12 million or 13 million or

11 million right because

it's it's pretty divisible and and it'll

be infinitely divisible on the layer too

on the lightning network so

so um

we're what really matters is that it'd

be deflationary

and not inflationary and and no one be

able to meddle with it

um

yeah so the implication the other

implication is just

we all should buy bitcoin right exactly

and i have another model that should buy

bitcoin yeah that no more than 350 000

people on earth will never have more

than one whole bitcoin

and that is also deflationary over time

that will actually reduce down as you

know the george sources of the world and

the michael sailors of the world start

jumping into the fray

what was your second question the second

part of your question uh would do the

second question was regarding other

treasuries

do they get wired off if you've put all

the toys you know

no

i actually think that we started a

stampede of people putting it into their

treasury there

you couldn't have found a publicly

traded company with five million dollars

of bitcoin in august of 2020.

you couldn't have fell one

and if you look at what's going on right

now

there's got to be three dozen or more by

the end of this year

and

you've gone from less than five million

like one or two million on corporate

treasuries and this is publicly traded

companies not all companies

you've gone from a couple of million in

corporate treasuries

right to

15 billion to many many many billions

um the thing that's uh and you know

coinbase just said they had like 9 000

institutional accounts

and i talk to private companies all the

time i know lots of private companies

that are getting into it um i i know a

plumber who has bitcoin on this balance

sheet three employees

think about that so there's a lot out

there for sure

yeah yeah i

look i think in mark if you'd asked me

in february

of 2020

what i thought about bitcoin and would i

put it on my balance sheet

i would have said

i wouldn't even and buy it as a private

investor much less as a public fiduciary

right i mean

and i wouldn't be sure

you know i'd be like well isn't that one

of ten thousand cryptos and people are

all trading

so that's where it was with me

because

i didn't ever need to focus on it

yeah it's you don't need to embrace the

idea of a paradigm shift in in property

or energy or money or currency you don't

need to question basic deep-seated

values

in the absence of a war

right there's two ways that people

change one is they die

and the other is there's a war

right and that paradigm shift there are

two things that i didn't really buy into

one is the digital transformation of my

operations like not deeply for example

i would have fired people that did not

show up to the office in in february of

2020

but

by april of 2020

nobody could show up to the office and

we zoomed everywhere

and so in a matter of weeks we went

through a decade transformation or

thinking about

digital marketing digital sales digital

operations etc

and and i feel like that we had the same

jarring shift with our balance sheet

in february

my view was oh well

i guess we'll get two three percent

interest

on our money

and we'll we'll be conservative

and the inflation rate is two or three

percent

and you know wall street doesn't maybe

understand it but maybe i'll buy back

some stock

okay and by april

my world view was

the the nominal yield is zero the

inflation rate is minus 20 percent i'm

going to lose

300 million dollars in the next 36

months if i don't do something and

there's no hope if i continue with the

traditional strategy

and i have to take a risk

and so i i think that that was a that

was a jarring thing and that shook

everybody out of their slumber and now

from that point

look james i wanted to buy bitcoin

personally desperately i wanted to buy

as much as i could

it took me 12 weeks to get the account

and the kyc

to do it 12 weeks from the point that i

desperately wanted to do it this is an

individual you're very biting your nails

losing time afraid it'd all be sold out

yeah yeah like anxiety induced right and

i went and i bought huge amounts at like

9 500 a coin

and then from a corporate point of view

well it's another three months

because companies have

all sorts of other you know corporate

governance issues the accounting opinion

the legal opinions the the board opinion

the shareholder relations issues

so it's six months if you're in a raging

hurry and for me

it was important because more than like

half the market cap of the company was

cash

okay there aren't many publicly traded

companies where half their market cap is

cash and so i was sensitive to it and i

had sort of

when my stock got to seventy dollars a

share right or we're trading a hundred

twenty dollars a share and we've got

sixty dollars a share in cash and you're

just trading a one-times revenue

you're thinking i've been forsaken right

there's not much downside from here

there's only upside i should do

something

so i i think that um

that the first jolt came march 2020 and

we started in april 8 sorry in august of

of 2020 we were the first company to put

that 250 million dollar buy on the wire

so call that the beginning of year one

of of major corporate institutional

adoption now what's holding people back

uh a couple of things

one is yeah one is gap accounting

and the number one impediment to a

company buying large sums of bitcoin

would be indefinite intangible

accounting

because if i buy a billion

and it gets cut in half for a day

and then it goes up by a factor of 20.

under gap accounting i would show a 500

million operating loss and 500 million

on my balance sheet

but under under fair value accounting

i would show a 9 billion dollar

investment gain

and i would show 10 billion on my

balance sheet

so people talk about volatility being a

problem

but you've got different types of

volatility you've got you've got fair

value or economic volatility and then

you've got accounting or optical

volatility the optical volatility of the

accounting is much more pernicious

to a public company with a pristine gaap

p l and balance sheet and and in an

institutional environment where people

judge you

based upon your beauty like based upon

your conventional conventional behavior

i'm going to put a i'm going to put

report out and i'm going to tell

everyone that i generated eight dollars

a share in earnings and they go blank

okay that's good

or i'm going to print a report saying i

actually lost 16

and i had a 500 million dollar operating

loss and my operating business has lost

money for the first time in 20 years but

by the way we just made billions yes

it's so funny there was a similar

corollary um if you were looking for

financing for real estate six months ago

within a traditional bank you could have

millions in bitcoin

they see it as zero

but i i'm really concerned about time

and i i think i've got about eight more

questions to get through if that's

correct we still have about eight

minutes left i've i have plenty of time

okay

well maybe you can't there there's a oh

i can of course i can stay here let's

just get through let's go through your

questions okay

well two of them are kind of related to

what you spoke about being a fiduciary

one is do you see any regulator risk of