WE HAVE LASER EYES - Michael Saylor at BTCPrague 2023

thank you for joining me today

um I was really excited about this

opportunity to come and and give this

keynote and Prague and um a lot of my

speeches have been uh fireside chats or

just discussions and the organizers and

Prague they're very thoughtful and I

think they're a bit more organized and

they said you know you really should

come up with slides

and I thought

slides

hmm

so um this is my first presentation this

year with slides

[Applause]

I'm hoping by the time I finish you'll

conclude there is no second best set of

slides

and uh without further Ado I'd like to

talk about the future of Bitcoin so

um let's start with an observation there

is an endless

economic War raging worldwide it has

been raging since the beginning of time

it is going on right now

um that War is Over the redistribution

of economic energy and we call that

wealth

uh but it is all of the money and the

power in the world right now and so we

have a nice map of the wealth of the

world here

and um the question is how is that uh

wealth being redistributed every single

month and every single year there are

three primary drivers

the first driver is government policy

the most powerful actors in the economic

War are governments everywhere in the

world they are moving money around when

I use money here I mean economic energy

or wealth they're redistributing it

the second Big Driver in this economic

war is technology

um it's it's the Advent of the apples

and the Googles and it's electricity and

its fire and its cars and its Teslas and

his AIS

the third driver in this economic war is

work it's all the hard work it's the

competition it's the energy when you get

up in the morning you go and you work as

hard as you can

now sad to say that the government is an

order of magnitude more powerful and an

economic driver than the technology and

the technology is an order of magnitude

more powerful than your work and I think

you understand this if you work as hard

as you can

uh but without a machine or you work as

hard as you can without the access to a

computer there's only so far you're

going to get

now um I was thinking

about Bitcoin and how Bitcoin plays into

all this and you can see in my chart

bitcoin's about 400 billion dollars of

this 900 trillion dollars worth of

global wealth

um you see gold is 12 trillion

and equities are 115 trillion it used to

be gold was equal to equity if you go

back 50 years it used to be gold was

about equal to equity so what happened

well there's a lot of technology and

Equity you know we talk about gold being

a shiny dead Rock but think about gold

mining and think about what uh

technology has done to gold mining in 50

years

semiconductors don't make it easier to

mine gold mobile phones don't make it

easier to mine gold

right uh what's happened in equity well

you've got Tesla you've got Apple you've

got Google you've got Amazon you've got

the internet you've got the telephone so

technology has shifted the balance of

power from gold to equity

government policy Shifting the balance

of power look at bonds bonds are are

driven very heavily by government policy

real estate driven very heavily by

government policy because government

policy controls capital and cost of debt

and that drives real estate

and of course there's money over here

so most important point is the

government is changing this uh this

field technology is changing this field

and you you can work as hard as you want

but you're going to have to take into

account government policy and Technology

if you want to actually survive in this

world

the world Reserve currency is the dollar

collapsing against assets like the s p

index like real estate

like gold like art

and this is a sobering thought

um if we had sound money the dollar

wouldn't collapse

but you've probably seen this chart this

is the dollar collapsing against

consumer goods

consumer goods you know the dollar is 95

percent weaker means consumer goods are

20 times more expensive today than 100

years ago

um Now consumer goods are manufactured

items candy bars bottles of water

Netflix videos

they're uh they're things that are

coming off an assembly line and they're

getting stamped out with a low variable

cost this is the cheapest least scarce

stuff in this civilization and yet it's

20 times more expensive

now a lot of times government officials

show you this chart and they say well

this is the impact of inflation

this in fact was generated by the Bureau

of Labor Statistics but the sad fact of

the matter is this is as good as it's

ever going to get for you

this is a different picture what if it

wasn't easy to Stamp Out manufactured

biscuits or Netflix videos what have you

had to do work to dig the gold out of

the ground gold is a bit harder

and so the dollar has collapsed 99

against gold in that same hundred years

not 95 percent

by the way gold is not scarce we keep

creating more gold we get better at it

but at the end of the day

you know it's a bit more scarce than you

know Netflix videos and it's a bit more

scarce than drywall

let's talk about something that's even

more scarce

the 500 most valuable companies in the s

p

the US dollar has lost

99.8 percent

of its value against the s p index over

that same hundred years

that is actually a closer measure to the

inflation rate

this is the world's strongest currency

this is the currency backed by the

country that won every war in the last

hundred years

this is as good as it's going to get for

you

this is as good as it gets it will get

worse

now

how do you measure inflation

if I measure inflation against something

I can manufacture for free

inflation doesn't look that high

if I measure inflation against a

yardstick that is fixed that's

thermodynamically sound then you see the

true measure of inflation

s p is one example of that

this is Miami Beach

Miami Beach runs 96 blocks there's that

much Beach a hundred years ago there was

that much Beach

no amount of semiconductor technology or

factories make more Beach

the dollar has fallen 99.8 percent

against the beach and a hundred years

that's how you start to see what's

really going on with the world's

strongest currency

now I have some bad news for you

we're not in America

we're in another country

foreign currencies are collapsing

against the dollar

this is the Argentine peso against the

dollar

in 20 years the peso goes from 1 to 500

the pesos lost 99.8 percent of its value

against the dollar at the same time that

the dollars lost 75 percent of its value

against the s p index

I let you do the math

if you run a company in Argentina

and you're going to work hard you're

going to have to grow your revenues from

1 million pesos to 500 million pesos

over 20 years to stand still

and that's why I say no amount of hard

work is going to solve the problem of

being on the wrong side of a economic

War

there's only one strategy here you have

to get out of that peso you have to exit

this is the Lira this is before this

week it lost 95 percent of its value now

the number is about 97 of its value

against the dollar

this is the rupee

it's lost 90 percent of its value

so that 99.8 percent loss is another 90

percent

so we're kind of running out of numbers

to calculate just how much of your

wealth has gone from you

to the government

when the government actually collapses

the currency 99.9 percent what it means

is over a hundred years they in essence

take all of your wealth and they

redistribute it

to their cronies to to whoever they want

and that's the rate at which it's going

this is Pakistan 82 against the dollar

this is the Brazilian real 65 against

the dollar

conclusion

if you want to preserve your wealth you

have to convert that currency

into an asset that scarce

desirable

portable

durable

and maintainable

right there there are certain things

that are scarce and desirable but they

don't move like beachfront property

and by the way maintainable

if you own a million dollars of property

in Miami you have to pay twenty thousand

dollars a year every year to maintain it

and it gets uh it gets assessed up so

you have to have a million dollars to

cover the taxes on a million dollars of

property in Miami Beach over about 20

years you can't maintain it

so you're going to be a smart investor

here's smart investors people bragging

about making money in the stock market

the s p index is going up seven to eight

percent a year

and so you must be really smart you

invested in companies that are making

good decisions look at the money supply

the money supply is going up at the same

rate as the s p index

and so what you begin to realize is most

investment gains aren't really gains at

all all you're doing is simply tracking

the monetary inflation rate if you're

lucky

now let's talk about all the assets

okay this is a this is a 30-year or

20-year return on asset classes compiled

by JP Morgan

on the far right you see Commodities

they're awful Commodities are silver

gold natural gas especially oil soybeans

Lumber

pork bellies why are Commodities awful

because humans are really good at

creating more of them and they will

drive the price down using technology

Ingenuity and capital

Commodities lose your money cash also

pretty awful

now you see the inflation rate that the

largest bank in the United States marks

they Market at two percent that's what

the government tells you their inflation

rate target is two percent that's their

consumer inflation rate

right every single 10 years or every few

years I'll just redefine the market

basket of goods and I'm going to put

drywall and manufactured biscuits and

Netflix videos and something cheap you

can be sure I take the expensive stuff

and I move it out of the consumer basket

I take cheap stuff and I put it in the

consumer basket and you're moving toward

a world where you live in a 300 square

foot apartment constructed of drywall

sitting on a cheap rickety plastic chair

with a set of goggles on while you're

imagine yourself in a beautiful Universe

with a bunch of digital stuff and you'll

get digital health care and you'll get

Digital entertainment and you'll have

digital friends and you'll take digital

trips to digital vacation destinations

in your digital jet

and everything will be good

that's the problem with the CPI now

look at the s p Index right you feel

like you're a genius if you're getting

seven and a half percent against that

but what if I told you the real

inflation rate

of the U.S dollar over a hundred years

is about seven and a half to eight

percent

that's the actual inflation

now you see the average investors

getting 2.9 percent when they're smart

Commodities are less the s p is

underperforming the inflation rate

look in the far left

what's your best chance it's called a

Reit Real Estate Investment Trust

if you have a property company and you

buy the scarce desirable real estate in

the middle of London or New York and if

you can generate a yield on it if you're

really good at it you might be able to

just barely keep your head above water

but you know none of these look all that

compelling

right I mean investment consists of

either losing your money fast or losing

your money slow

or or after a hundred years of

Brilliance assuming that the government

doesn't fail and you don't have your

assets seized and I didn't include taxes

as long as you don't die you don't have

any capital gains and you don't have any

heritage tax you might barely just keep

what you had a hundred years ago in this

world

most investors they just perform poorly

because of bad habits

what kind of bad habits

this is a 30-year chart of Returns on

the S P index

and this chart tells you

that

if you missed one day there's one day

every year

when 85 percent 90 percent of all of the

gains come one day

and there are 36 hours a year when all

investment return takes place

so in 365 days nothing happens

99.5 of the time

this is why we have the laser eyes

this is why we say huddle

because

and I have said before trading Bitcoin

is a sign of lesser intellect

if I were to say one percent of the days

you could trade successfully I would be

overstating your odds of success

you literally have to find the 24 hours

out of 365 days when the market moves

and you will be wrong 99 plus percent of

the time if you trade

it's you're going to sit here and

Bitcoin is going to be whatever it's

going to be and then one day you're

going to wake up and it's going to

double

and if you missed that day

you're going to be kicking yourself

huddle don't trade most people destroy

themselves by thinking that they

actually can time the market

this is a chart as of about a month ago

and what it shows is year to date

one percent of the companies and the s p

index had all the gain

if you look at this chart this week

the number for there are 493 companies

in the sap index that have collectively

zero percent return

and there are seven that have 50 return

and another way to say that is 99 of the

companies cannot keep up with inflation

you think you're going to pick stocks

you're going to pick the winner

there's a 99 chance you won't

and maybe there's a bigger idea here

which is

if you have one of the greatest

companies in in the world

there's a 99 chance after a hundred

years of being great you still can't

keep up with inflation

and this is why I say maybe your hard

work doesn't matter as much as

government policy matters

you're you're not going to find the

winner

99 of the time

and uh

you remember I've said before

diversification

it's selling the winner to buy the loser

right all these really brilliant

investors that diversify

their base if they're smart enough to

buy apple or Amazon when they diversify

they go from 44 return to 10 return

and if you manage to like get it right

you may be the zero percent return

so that leads us to the question what is

money

right because it's investment assets

aren't working so well

what is money well

in theory money is a way for you to

store your economic energy and not have

it stolen from you by the government

by about investment decision right

perfect money is in fact the solution to

all your problems but what is good money

gold has been an aspirational money but

it's defective

and the reason gold is defective is

because we keep creating more of it and

you can't custody it and so if I keep

creating two or three percent more then

that means that the half-life of your

economic energy and gold is 35 years

means every 35 years your money's cut in

half or the value of your wealth is cut

in half

the only way to make gold perfect is to

stop mining it and make it possible to

teleport and carry around in your head

and of course this is not happening with

gold

it is difficult to create

sound money

how difficult

well Bitcoin has gotten 50 50 trillion

times more difficult to mine since it's

uh was formed 50 trillion

now what is that telling you well for

the money to be sound I have to cap the

supply

and in order to cap the supply I have to

make it exponentially more difficult to

create it

and human beings in this small corner of

the world bitcoiners

who have been ignored

they figured out how to create 50

trillion times more work

in those 14 years

that's that's what you're fighting

against and that's why Commodities make

awful money

that's why anything that can be produced

with human intellect and capital will

always be awful money because you're

betting against human intellect

I'm going to actually store my money in

something that you can make more of and

I'm going to bet you're too stupid to

make more of it

okay that's an awful bet somebody

somewhere with less money than you has a

lot of time on their hand to figure out

how to get your money

that's why you need something like the

difficulty adjustment

and that's why it's so difficult to

create sound money

Bitcoin is sound money

now people around the world use all

sorts of Assets in order to store their

economic energy

all these monetary assets have a

different natural frequency

for example oil gets produced with a

stock to flow ratio which is extremely

low

the Argentine peso is is doubling

in Supply every one two years

uh silver is growing at a fairly rapid

rate

when the dollar inflates at seven

percent a year

that that means that over the course of

10 years you double the supply of the

dollars

so therefore the half-life of money in a

dollar is 10 years

um as the stock to flow ratio goes up

the half-life and the money goes up the

natural frequency slows down

gold

has a half-life of 35 years

obviously gold is a better money than

the peso it's a better money than

soybeans

but now you see the real key is what is

the natural frequency of the asset

and what's brilliant about Bitcoin is it

started with a higher frequency but that

natural frequency is going uh to

Infinity it's becoming a very low

frequency money

next year after the having

stock to flow is 120 the half-life of

your economic energy and the money you

know Bitcoin goes to 100 years

in the year 2036

the half-life of your economic energy in

Bitcoin becomes a thousand years

in 2048

Bitcoin is 10 000 years

now

politicians want to tell you that this

is impossible

Commodities in nature tells you this is

impossible but look at my chart here

in your lifetime

there's one asset that has a long enough

frequency that you can actually expect

to keep your money forever

this is economic immortality when stock

to flow when flow goes to zero

stocking flow goes to Infinity

the money lasts forever

if the money lasts forever you have hope

what is money

perfect money is a way to escape the

misery of the economic war that is

depriving you your family and your

company of 99.9 of everything you have

with absolute certainty

and there is no amount of work and there

is no amount of trading no amount of

thinking and that is going to escape

this reality you're going to have to

find this solution

what's the winning strategy

there's only one winning strategy that I

see it's hold the best money

and if you hold the dollar

which is the best currency you're going

to zero if you hold a weaker currency

you're going to zero in a few years

gold is a sort of better money than the

currency stocks are of better money than

gold Bitcoin is a better money than the

stocks

but let's talk about this a bit the

conventional

the conventional uh organization company

investor

they think the s p index they think

corporate Equity is the best money they

have monetized it and that's what

they're using

and so I wanted to break down what

corporate Equity looks like

versus Bitcoin

you know the the traditional Return of

the s p index is about seven percent a

year

well Bitcoin should in theory return 14

a year it's returned a lot more it's

returning 40 50 a year over the past

three years and much higher over a

longer period but I want to I want to

lay out the reason that companies don't

work

as well as perfect money or digital

money

first of all you've got you've got the

dilution that comes from management the

Management's going to pay themselves one

percent of your return every year

you've got the risk of Labor uh

companies unionized they have to pay

labor the cost of Labor keeps going up

it's another one percent

you've got competition

there's going to be someone that's going

to produce more gold or more iPhones or

more something more computers it's going

to cost you another one percent

you've got technology you had a really

good camera business and then the camera

becomes software it's going to cost you

one percent

you've got regulation the EU is going to

actually find Facebook or Google for

doing something on the web it's going to

cost you one percent

you get taxation if I can locate your

employees locate your management locate

your company locate your headquarters

it's going to cost you one percent

and then you've got War

and the war may be a hot War where

you've got a tanker and I blow it up or

it may be an economic War like a tariff

and I'm just going to put a 25 tariff on

you

companies have all those risks if you

ask what's the cost of it

about seven percent a year

what you can expect is over time over a

hundred years you're always going to pay

the seven percent

now what's the implication

of getting a seven percent yield

versus a 14 yield

because Bitcoin actually avoids that how

does Bitcoin avoid it

the Bitcoin virtues are we replace

management with cybernetic control

the software controls the system not

people the software does the work for

free I replace labor with a digital

system I replace competition with an

Immaculate Conception there's only one

Bitcoin Satoshi gave it as a gift to the

world there's no competitor there's no

second best why because someone created

this gave it away to the rest of us

without any beneficial interest in it

that's what makes it unique

Irreplaceable

you know special

that instead of Technology risk

like the iPhone 15

Bitcoin is just money 121 millionth of

everything there's ever going to be

it's not going to actually obsolete it's

Immortal product in a thousand years

you're going to want to own 121

millionth of everything there is in a

hundred thousand years you're going to

want to own 121 millionth of everything

there is

that's how you escape the competitives

uh the competitive downdraft and that's

how you avoid the technology destruction

and of course with regulation Taxation

and War guy being a digital asset you're

living in cyberspace

you can't destroy it it's it's

indestructible it's Incorruptible it's

global

Bitcoin is going to duck the exposures

of these other systems

so what's the implication of that

if you had a million dollars today and

your company or in your family

and you hold it in cash in the world

Reserve currency that is seven percent

inflation rate

in a hundred years you will have in

today's dollars

977 dollars

you will go from a million to a thousand

you'll lose a thousand X

it's one divided by 2 to the tenth

if you take all your million dollars and

buy government bonds yielding three and

a half percent interest you're gonna

have a three and a half percent negative

real yield carry that for a hundred

years you're gonna have Thirty one

thousand dollars

three percent of your wealth

if you're brilliant and you invest in

the s p

you're gonna have a million dollars

you'll have the same value the same

wealth in a hundred years you have right

now but no more

if you take half of it and invest it in

Bitcoin and the other half in the s p

you're gonna have 512 million dollars

and if you go a hundred percent Bitcoin

you're going to be a billionaire

all you got to do is Flip Your million

dollars into Bitcoin hold it at seven

percent real yield a hundred years

and that's that's the money you have

times two to the tenth and so you can

see in a very simple way there's a

winning strategy there's a losing

strategy every other strategy is you

know the trading the investing it's just

a waste of time

you could ask what about the real world

here's real world in the last two and a

half years since microstrategy entered

Bitcoin

Bitcoin is outperformed the s p the

NASDAQ Gold Silver and bonds bonds are

destroying wealth silver is destroying

wealth gold is destroying wealth

bitcoin's crushing everybody and you can

say

well what about microstrategy all the

guys on Twitter they're all like they're

all like Twitter trolls hey you lost

some money investing in Bitcoin that's

the microstrategy performance

that is your company on a Bitcoin

standard

that is your family on a Bitcoin

see you just keep you keep dollar cost

averaging or Bitcoin cost averaging

and at the end of the day it doesn't

matter at what price you buy what

matters is you keep buying and you don't

sell and you don't invest in the bonds

the silver the gold and the rest

the future

the world's in an economic War but the

world is beginning to realize Bitcoin is

the superior asset

and as they realize that Bitcoin is

going to demonetize all these other

assets over time

it's gonna it's going to first

demonetize gold

because gold doesn't make any sense and

then it's going to demonetize the other

store value assets the real estate the s

p index the bonds and so you're going to

get a 30X bump as we demonetize gold but

there's no reason why you can't have a

500x increase in today's dollars by

demonetizing these other things

and I'll end with this thought

we have laser eyes

because laser eyes say focus on what you

can change

save what you can save

in this particular case you can make

Bitcoin a success you can tell the world

about Bitcoin no country can stop

inflation nobody can stop inflation I

can put you in charge of the world you

cannot stop inflation

99 of the companies they cannot outrun

inflation 99 of the workers they cannot

outrun inflation one percent may beat

the market by skill and luck don't

assume you'll be the one percent

everybody

can buy Bitcoin

so five Bitcoin

thank you