Michael Saylor Just Explained Bitcoin's ENDGAME

All right, here we are. Sailor, let's do

it. Let's do it. Michael, thank you for

being here with us. We are taking

questions from the

audience. We'll kick it off. I hear

there's about 100 people standing

outside, so uh congratulations to all of

you for making it in the room. Next

year, we'll find a bigger stage. Uh all

right, let's go with the first one. Uh

you mentioned that simply holding

Bitcoin is enough, but would you ever

consider building something like a

Bitcoin bank, or does that go against

your philosophy?

That's a good question. A bank is a is a

regulated or it's a reserve term in

western civilization. So right now it

means a company that uh takes you know

business or retail

deposits. It's regulated. Um if you're a

regulated bank, you might actually be

prevented from doing other financial

things. So we don't have any plans to be

a bank.

Um we're much more enthusiastic.

uh about uh pioneering the world of

Bitcoinbacked credit

instruments. You we want to have you

know the premier bitcoinbacked equity

and bitcoinbacked credit. And so it's

it's it's a set of financial products

but not a bank. Right. That makes sense.

All right. Michael, a lot of people

believe in diversification, but you've

gone all in on Bitcoin. What gives you

such strong conviction in that choice?

Well, Bitcoin's the Are you sitting in

more than one chair? Are you using more

than one microphone? Gosh, when that

happened, I Dude, I loved that clip.

Only digital commodity. And if you're

going to be a public company, then you

need to be capitalized on a commodity.

And Bitcoin is the first uh commodity in

the history of the world that

outperforms the S&P index on a

consistent basis.

So

uh if you are a public company it's a

very simple choice uh there's one best

asset and there is no second best asset

right um got it

so I mean I I'm an aeronautical engineer

I have conviction in Bitcoin like you

have conviction in using aluminum to

build an airplane and the reason you use

aluminum to build an airplane is because

if you use steel, the plane won't fly.

Uh, so Bitcoin works for a public

company because it's higher performance

than the S&P and it's more volatile than

the S&P and it's a commodity and so you

can go to 100% leverage and every

mathematical model you can possibly work

through indicates that the right answer

is 100% Bitcoin. If you diversify that,

all you're doing is bleeding off

diluting the volatility which devalues

the options. When you go when you go

from 100 V to 40 V, your options market

would go to from a 100 billion to a

billion. So you're going to destroy your

own options market and if you uh dilute

the Bitcoin with anything else, you

would destroy your performance. And so

on a the first order answer is it makes

no sense because the options are

destroyed and the equity is destroyed.

The second order answer is you can't

build uh a bitcoinbacked convertible

bond or bitcoinbacked convertible

preferred stock or bitcoinbacked fixed

income preferred stock if you're not

bitcoin backed. Right? And

so if Bergkshire Hathway, for example,

were to buy a hundred billion dollars

worth of Bitcoin

tomorrow, they might have more Bitcoin

than us, but they couldn't issue equity

and credit instruments that have

Bitcoin's performance because they would

be

diversified. And uh and so at the end of

the day uh it makes sense for us to be

100% Bitcoin because it gives you the

first order best result and then all of

the securities that we build inherit the

volatility and the performance of

Bitcoin and uh and we would in essence

be destroying we're crippling our own

securities and crippling our own

performance to diversify. Hi. I love

that. I want to go a little bit off

script because you said something. You

said uh uh there is no second best,

right? That's a meme that you created.

You have a couple of them. Uh it's going

up forever. Laura, uh all your models

are destroyed. Couple of my favorites.

You guys bought uh 420 with a zero in

between uh of Bitcoin yesterday. You

guys talk about the importance of of

marketing and and memes and mimemetics

uh in your guys' boardroom. How

important is that to what you guys are

doing? Um, I think I think we live in a

world of abundance and there are more

messages and there's more entertainment.

You can sit and you can watch Magnus

Carlson chess

videos and you can almost watch an

infinite number of commentators

commenting on the same chess game by

Magnus Carlson. If you want to go down

that rabbit hole, there's infinite

everything. Infinite enter

entertainment, infinite message,

infinite news, and everybody's

overwhelmed and bombarded. And so it's

important that if you have a message

that you uh that you condense it down to

something which is very efficient. Um

people don't have time to read 30 pages.

They don't have time to read two pages.

They probably don't have time to read

two paragraphs, right? Um, if I were to

write a book on why Bitcoin is the

superior investment asset, 0.1% of the

people would read the book in a decade.

If I simply said there is no second

best.

Amen. And if I can get like a

three-year-old kid with a beard to say

there's no second

best, like baby sailor can get the point

across a million times as

efficiently. And uh and so I I think

that these are important because you

just can't spread the information

efficiently enough unless you put it

into a viral package.

just like that's such a good framework

through which to understand money at the

same time that money is compressing all

of this data about all of the activities

that have been done in the world, right?

What is the actual supply of goods and

capital? What is the actual demand? You

know, all of these things get compressed

into just the market price and money is

the language through which that is

communicated. like it's very meme like

in that sense and that it's a data

compression technology. And so again,

when I said earlier in our past video

that Bitcoin is like the ultimate meme,

it doesn't just mean that Bitcoin has

this very recognizable brand. It's that

it is its functionality as a tool is

actually compressing the most possible

data. Yeah. Yeah. And it price movements

are telling you the truest picture of

what people actually want versus what's

actually available in the world. Now,

it's not now people aren't pricing

things in Bitcoin widely yet. That

hasn't been fully adopted in that way.

So, that's what that's very forward

thinking. Well, but you can do it today,

right? As we said earlier, the Yeah.

housing prices are down Oh, sorry.

Housing prices are down 99% over the

past 10 years. I say this in 2025 if you

denominate housing prices in Bitcoin.

Yes. So the tool is available to you.

It's always a matter of what frame of

reference are you using to evaluate

economic activities. So money does have

this very deeply and this is where words

get a little tricky. Mimedic not

mimemetic. Like mimemetic is like

imitating. Mimetic is more like this

data compression aspect that he's

talking about. Okay. Yeah. Interesting.

And Richard Dawkins is the father of

that idea. the book of the book the

selfish gene he talked about you know

what genetics are that basically we pass

our genetic information on to our

ancestors he talked about the cultural

version of that which he called the meme

but memes only became popular in the age

of the internet so this idea has been

around for a while but it's like uh it's

cultural genetics if you will yeah well

I will say Sailor's wrong I know one

individual sitting right in front of me

that has time to read more than two

paragraphs every Okay. Very well read.

It's always a always a matter of

prioritization. But uh but he's right,

right, that all of our attention spans

have been [ __ ] debased. Well, and

it's just bombarded with with

information. And by the way, like I

carve out time to read books because I

just happen that's something I've been

doing for a long time. But I too get

sucked into, you know, doom scrolling

and all this stuff on this thing for

hours at a time sometimes. Yes. You

know, especially when I'm traveling or I

don't have anything else to do. I'm just

flipping through Twitter, flipping

through Instagram. And so, yeah, I think

that's what he's speaking to, right? It

does take its toll on your attention

span. Well, not only that, but I mean, I

I'm very interested in what's happening

in the Bitcoin world and and beyond. And

there's just too much information. I

can't keep up with it all. Like many

years ago, I was like, I could devour

all of it, but it's just become so

abundant. It's like, you know, you have

to pick and choose, and there's a lot

out there. We're all drinking from the

fire hose now. And now that everyone is

both a producer and a consumer of

information, it's like it's exploded

exponentially. Like my mom, I always

tell the joke that when my mom was a

kid, she said, "We had channel 3, 6, and

9, or was it 3, 9, and 12, whatever it

was?" They had three channels. Yeah. And

she goes, "And if the president was on,

you're fucked." Cuz he'd be on all three

channels basically. That's funny. So,

we've gone from that world to like what

he just described, right? The infinite

rabbit hole of any niche you want to

look into. Totally.

You got it. Yes,

absolutely. A lot of questions uh came

in about MNAV. A lot of people curious

about this. So, do you think it's

possible for MNAV to drop below one in a

bare market? And if it does, is it just

me or like, you know, I love that reel

that's I saw on Twitter where it's a

clip of like 60 seconds of somebody

asking him a question, a bunch of

different interviewers.

Oh, yeah.

It's like he's so brilliant that he's

like both bothered but then at the same

time happy that he's answering these

questions where it's like a [ __ ] I got

to explain this again. Uh who knows

what's going on in that cranium. I don't

know. But he definitely brings the heat.

How would that impact your strategy?

Yeah, I I I think an important point on

that is is I sometimes I see like uh

Twitter analysts saying, "Oh, this is

just like GBTC and Grayscale went below

one times NAV before." And uh what they

miss is that Grayscale was a trust

company, a closedin trust, and we're an

operating company. And a trust company

doesn't have the option uh to refinance

or take on leverage or or to sell

securities, buy securities, recapitalize

or buy their own stock back. And so when

you you should think of a trust company

is

uh no I'm going to I'm going to pick the

wrong metaphor and people will hate me.

Uh it's it's just a form of corporate

entity that has uh no operational

flexibility to manage its capital

structure. Operating companies have much

more flexibility.

uh we can buy stock, sell stock,

recapitalize, we can take on debt to fix

uh or to close a gap. So at the end of

the day, I I think that um the one

example people have in the crypto

market, Grayscale, trading below NAV,

was because it was a trust, not an

operating company. Um theoretically here

when an operating company or a company

doing something trades below NAV, it's

because the

investors have lost faith in the

management team and they think the

management team is destroying

shareholder value by acting

irrationally.

So, for example, if if I were to give

myself a billion dollar a year pay

package and announce it, the stock would

dive and people would say, "What if I

just said, "Hey, I have $64 billion of

Bitcoin. I'm going to pay myself a

billion dollars a year for the next 64

years." People would lose faith in the

company. They would say, "The management

team is looting the shareholders." They

dump the stock. The stock would trade

below NAV. It's because the management

team is doing something out of alignment

with the interest of the shareholders

that the stock would trade below NAV.

Now, having said all of that,

um we can we constructed the company so

that the company can generate yield and

generate gains even at NAV or below NAV.

For example, we have $64 billion of

Bitcoin. If the stock were to trade to a

dollar tomorrow, well, we wouldn't sell

the equity. Duh. We would just sell the

preferred stock. We would be selling

stock overcolateralized 10 to one

against Bitcoin with a 10% yield. And we

would generate billions of dollars of

gains selling the preferred or the fixed

income instrument. At some point, people

would say, "Wow, uh, they're generating

gains anyway." And then the value would

come back into the equity. Or we would,

uh, we would sell, you know, you sell a

preferred

stock. it I if someone's stupid enough

to short my stock to a dollar, I would

sell a billion dollars of the preferred

and I would buy back the common

stock, right? And I would just

recapitalize the company, right? And

then the common stock would fly through

the roof and then they would be

complaining that we bought the thing

that they were selling. So operating

companies can do

this. Trust companies, trust funds,

ETFs, they can't do this. a closedin

trust can't do what I describe. So, so

the way that I see the world and the way

that we see the world is is when someone

irrationally misprices

something, then we if it's if it's

mispriced too low, we buy it. And if

it's, you know, and if it's priced at a

massive premium, we might sell it. Not

to drive the price down, but just to

capture the premium. And we construct

all the preferred. So that this pref I

sell this preferred to people want US

dollar yield. I sell this preferred to

people that want convertible. I sell

this preferred to people that want JP

Japanese. Dude, he's going to kill. He's

going to have the most valuable company

in the world, right? Like if any of

these other companies try to come in,

like let's say Burks Hathaway buys a

hundred billion dollars worth of

Bitcoin, they'll have more Bitcoin, but

they don't have the flexibility that he

has. And then in in them doing so,

they're going to drive the price up and

they're going to give him the ability to

dilute, sell bonds, whatever to get more

Bitcoin. Like, can anybody catch him?

Uh, well, the one caveat with the

Birkshshire analogy, he's saying that if

they only carved out a hundred billion

dollars of their cash to buy Bitcoin and

they remain diversified, they couldn't

execute on this specific 100% Bitcoin

strategy that he's employing. Now, the

caveat there is, well, what if Buffett

wakes up tomorrow? Actually, he's not

the guy running it anymore. Whoever

Birkshshire CEO wakes up and says, "You

know what? We're liquidating it all for

Bitcoin and we're going to run this

strategy." He'd have a hard time

catching up with that. God, that makes

sense.

Yield. I'll sell this thing to someone

that might want a euro yield. I will I

will create this for people that want uh

leverage. And um and ultimately, we're

creating value. And if if um if one of

the securities trades

weak, we either stop selling it or we

reverse it and start buying it. And um

and the and and if you if you don't go

to bis business school, then I'll boil

it down to one sentence. Here's business

school. Keep your options open, right?

That's what you learn in business

school. And how do you create value? You

have to generate option value. So you

would say, well, why do you have that

preferred and this preferred and why do

you do this some days and not do it

other days? We're we're generating

optionality. The more optionality we

generate, the more opportunity we have.

The um the strife product, one day

someone will start to talk about

interest rates collapsing. Maybe

there'll be someone writing a story

about how the Federal Reserve is under

pressure to lowest interest rates and

sulfur will dive or the forward interest

rate curve will dive and strife will

trade up. And it's it has nothing to do

with Bitcoin. It has nothing to do with

our equity. It has nothing to do with

the MNAV. It has to do with people's

opinion of whether or not Jerome Powell

is going to change his something. And so

we're creating optionality into the

credit market. like someone else will

say, "Well, I think the S&P is going to

start to provide a credit rating for

Bitcoin companies like

MSTR and then the price of those things

will readjust and there'll be a huge

surge of demand and we

will I if we have an ATM when that surge

of demand comes, we can sell 10 billion

dollars in a week. If we don't have an

ATM and that surge of demand comes, we

sell nothing in a week and we talk to

some bankers for four weeks and then by

the time we do something, the

opportunity is lost.

So the thing that makes our company a

monster is having multiple ATMs in

multiple capital markets. All of them

correlated to different forecast like

your forecast of interest rates, your

forecast of Bitcoin volatility, your

forecast of of Bitcoin itself, your

forecast of crypto policy, all of those

futures are changing all the time. We're

straddling that future and we're able to

either buy or

sell or hedge any of them in real time.

A million, 10 million, a h 100red

million or a

billion, right? And sometimes you do

nothing for like you could do nothing

for a month or two months and then you

could do $2 billion in two hours, right?

So, and maybe you'll do something, you

know, consistently, but we we've built

the business uh to straddle the crypto

economy and the traditional finance

economy and to and to monetize

volatility and uh and we're pretty

thoughtful about how we do it. So I you

know and this is the joke

um you know I said this earlier I don't

know if this is our last video or this

one but that sailor had said something

to the effect that there's only a

certain throughput at which a profound

idea can spread across the minds of men

in the world. That's why Bitcoin had not

caught on more broadly yet. Um, I think

you could interpret the entirety of

strategies, Bitcoin strategy as an

arbitrage of that situation, right? He's

plugging into every credit market in the

world. Uh, basically enacting Gresham's

law. So, he's selling the weak money.

Yeah. which is any [ __ ] credit

instrument you can think of basically

using it to acquire the hard money and

hoard it which then adds to the

volatility of a stock which then

increases market capitalization which

then lets him issue even more of that

into more markets at higher volumes and

more options and he just wash rinse

repeat feed creates a feedback loop

feedback loop and there's a flywheel

effect too the bigger it is the faster

it goes of course now as long as you

manage all of that intelligently which

that comes down to the terms terms of

the debt itself, right? Is it mark to

market? What is the frequency? When, you

know, what are the liquidation clauses?

Blah blah blah, which as I've heard him

talk about before, they're pretty smart

on all of that, thinking about um what

debt not to take on. But I I guess the

the point I was really driving at is

that it is just

you've arrived at an idea. 99.9% of the

world has not yet arrived at that idea.

And it is this uh disruption of gold and

everything else that's built on top of

gold as money which is what Bitcoin is

doing. Yeah. And so then you are now

selling all of these credit in you call

them whatever you want. Basically it's

inferior money inferior assets to

Bitcoin. You're selling that to everyone

that hasn't caught up to you

intellectually and then using those

proceeds basically leveraging their own

balance sheet when they buy your stuff

to buy Bitcoin. Yes. And so it becomes

like an access pipeline to every market

in the world. And then he's putting all

the bells and whistles on it with the

optionality and the different yields and

different this and that and you know

preferred conversions and all that. And

um yeah, it's a great it's a strategy

that I think it is basically the same

reason why Bitcoin eats the world. It is

go it goes back to Gresham's law which

Gresham's law basically says

bad money drives good money out of

circulation. So when they used to clip

coins and they would issue you know a

coin that said this is one gram of gold

but it had been debased and it was

actually 0.9 g of gold. Yeah. Well

people would spend the inferior Yes.

money that had the same face value but

lower actual metallic quantity and they

would hoard the 100% full coin so in

that way the good money drives the I'm

sorry the bad money drives the good

money out of circulation. So he's

basically issuing quote unquote bad

money right to hoard the good money and

offering all these products of to people

who are unaware of that or don't have

access to the underlying asset. Well,

it's people that are whether they don't

have access to it, can't buy it due to

some, you know, uh, clause or mandate

inside of their their endowment or

whatever the thing may be, they they or

they're just ignorant of it, right?

There's a lot of people that don't know

anything about strategy or Bitcoin, but

they saw that the stock price is up 100x

in the past 5 years. Let me buy some of

their preferreds. Yeah. Yeah. And so

that's the like the arbitrage that as I

interpret it, how it's And what's what

risk do you see? Well, it's all the debt

risk. All the debt risk, right? How do

you manage all of that? So, yeah.

Um, yeah. I don't know. Like, I'm sure

they have a very sophisticated framework

for managing the debt, right? And if if

Bitcoin were to draw down to some crazy

number and stay there for a long time.

Yeah. What would they do? You know, I'm

sure they have contingency plans in

place, but that is the risk. Yeah. It is

still debt. You can still get

liquidated. Uh-huh.

seamless and say and going back in time

you know he he doesn't talk about this

much but there was a point he shared

this with me I think he was like he

might I don't know if this still holds

but at one point he had lost more money

in one day than any other human in the

history of the world and like around the

dot crash he lost like billions in a day

like his stock price was down 90

something percent basically overnight

and he was he I don't know I haven't

fully investigated the story but he was

sharing that he thought he still held

that title. I don't know if that's still

the case, but he's been to this rodeo,

you know. Yes. And so that would lend me

to believe that he has done extreme

diligence. Yeah. Like when you've been

through that much pain. Yeah. Um you

you've probably learned a lot through

the process and he's, you know, he's

probably taking every imaginable

precaution to prevent that from

happening again. He's clearly I mean

he's brilliant. I love listening to him,

you know. Um, yeah, the the lengths that

he goes to, you know, and his ability to

explain things, the examples that he

pulls out, I mean, it's just so readily

available. His his his thought process

is clearly very deep. Mhm. Yeah.

If you're closed in trust and you trade

below Matt Nav, that's death. If you're

an operating company and we trade below

NAV, we just get to monetize that.

That's good for me, right? I mean,

arguably the more irrational the market

it is, the better it. If you were to

short our stock down to 10% of NAV, we

would make billions and billions of

dollars a day, right? And so, we have a

very anti-fragile structure and uh and

and I think we're pretty optimistic

about the prospects there because I'm

quite sure the market will stay

volatile.

Yeah. All right. Cool. Well, let's keep

going. We uh our clock is out, but hey,

can I get another like 12 minutes? I

think we're we're running a little

early. We want to get through some more

questions. Um as long as that's good

with everybody here, we'll keep keep

rolling. All right,

cool. All right, Michael, do you see

Bitcoin starting as a store of value and

eventually becoming a global currency

like other forms of money have? That's a

good one. I I think if you read um if

you read the history

of the

Rothschilds, the greatest bankers of uh

the 19th century, they had a network.

The Rothschild banks were the network.

The the the primary uh asset, capital

asset that traded was sovereign debt.

They were trading UK debt and French

debt and German debt par value 100 and

they moved those those instruments

bearer bonds around very

rapidly and then they and that's how the

entire banking network worked in the

19th century and then when they did cash

settlement you know what cash settlement

meant cash settlement for the

Rothschilds in the 19th century and but

I bring this up because uh Bitcoin is a

peer-to-peer cash system Right. And all

these people like they're always

tweeting at me like, "You don't

understand what peer-to-p peer cash is."

Okay. When the

Rothschilds cash settled a bear bond

transaction in the 19th century, that

meant they traded the bonds for gold

bullion or gold coin. And so cash meant

gold. It meant metallic money either in

bullion form or in uh coin form. But

even then uh gold was just he's

absolutely correct about this like the

word cash comes from cass it's a French

word means money box was a literal box

where you kept metallic money so it's

always been an instrument of final

settlement not deferred settlement not

paper like we it's it's been bastardized

paper has never been cash never was cash

when do you know when that's when we

started calling paper currency cash I

don't know but he's this is the origin

of C is what that's why Bitcoin is cash

because it is an instrument of final

settlement, right? There's no liability

attached to it. When I send you Bitcoin

on chain, I've slid a gold coin across

the table. There's no liability. There's

no authority that's authorizing it. Yes,

it's a free market valued bearer asset

which further enforces the layered money

thesis and the small blocks and and you

know using lightning or I don't know

derivatives on top of Bitcoin because

then you're going to do final cash

settlement. So this idea that Roger Ver

is like oh this needed to be you know

medium of exchange on the main chain

globally is kind of missing the point.

Well the whole thing is based on an

illconceived conception of the word

cash. Cash is not the paper that you buy

your coffee with. Cash originally. Now,

I'm not saying everyone in the world

would disagree with me, but he is

actually correct. This is where the term

originates. Yeah. And it's very

important to understand that because you

have to understand final settlement,

right? We we think most people think if

I hand you $100 bill, we're done, right?

I paid you. We're good. You still have a

liability attached to that dollar bill,

right? You go stick that $100 bill under

your mattress for 10 years, watch your

purchasing power go down. Yeah. Right.

That's that liability being expressed

into your purchasing power. Right now,

if I slide you a gold coin, no one's

gonna Well, no one's going to debase

that any faster than we know it's been

debased over 5,000 years, which is

roughly 2% a year. So, you should see

your purchasing power remain stable or

slightly go up. That's because gold is

cash. Paper is not. Yes. Bitcoin, gold,

physical cash, paper not.

I did not know that. Yeah. too slow and

too cumbersome to settle very

frequently. And so there was a fiat

currency, these bonds trading over the

cash system, the go in the gold standard

all through the century. And I think

it's important because if you look at

Bitcoin today, Bitcoin's digital gold,

it's digital cash. What does it mean?

It's a bearer instrument, a monetary

instrument. What do I think is going to

happen? I think it's going to keep

growing from a trillion to 10 trillion

to 100 trillion. It's going to keep

getting bigger and bigger in the capital

stack. And I think other forms of money,

fiat currencies will continue. You're

going to have sovereign debt, corporate

debt, other type municipal debt. As long

as you have cities, they'll issue debt.

As long as you have countries, they'll

issue debt. As long as you have

companies, they'll issue debt. As long

as you have families and they want to

buy a house, they'll issue debt,

mortgage back debt. You're going to have

all these forms of credit. When people

cash settle, the settlement network will

Bitcoin. Was the world built on a gold

standard in the 19th century? Yes. So,

you only have debt in in a Keynesian

economic model. You need an inflationary

currency on top of the underlying asset

to have debt. Otherwise, the debt gets

more expensive over time in like a true

Austrian economic model or on a hard

money standard.

Yeah. You're disentivized from borrowing

sound money because the purchasing power

of sound money goes up over year. Which

means if you borrowed in terms of if you

borrowed gold and the value of gold's

going up every year, then the debt load,

the real debt burden on you as the

borrower is going up every year. Yes.

Fiat currency is the inversion of that,

right? The money is depreciating over

time. So everyone is incentivized to

borrow. What he's saying only applies

with a debasing fiat currency. Well,

it's not to say that there won't be debt

on a sound money standard, but it would

most likely only be commercial debt

where people are borrowing to execute a

specific project that's expected to

deliver a return that is over the

appreciation expected of from holding

money basically. Uhhuh. So we go from,

and this is of course just my own

estimate, global debt to GDP today is

like 350%.

Right? Like 350% of global debt or is

350% larger than global revenue, which

is GDP output, right? That's bonkers.

Mhm. It should probably be like one

tenth of that or less. Like Okay. Global

debt to GDP. Global debt would be like

30% of GDP maybe. You know, I don't know

what the right number is for commercial

credit, but it would be way way way less

Yeah. than what we see in the fiat

paradigm. Okay, got it.

Gold, but what circulated sovereign

debt? Will the world be on a Bitcoin

standard in the 21st? And just one other

point, this, you know, yes, sovereign

debt was the main thing that was traded

historically, but that's because

governments have always been the biggest

business. Monopoly on violence and all

of the tax revenues, that's makes them

the biggest business in the world. Is

that going to be the case in a

bitcoinized future where it's impossible

to inflate currencies and it's very hard

to tax people and people have a lot of

authority to vote with their feet and

take their purchasing power with them? I

think government shrinks a lot. I don't

think sovereign debt will be the premier

asset class in a bitcoinized world. Yep.

Century. Yes. What will circulate? every

form of credit of every creditworthy

counterparty and then on top of that

equity layers of equity from public

company private equity and you'll have

all sorts of other collectibles I don't

see a world where that

disappears I don't see a world where it

needs to disappear and so I just I see a

world where there are many types of

assets but the king apex asset the root

asset which everything else is settled

on or everything else is uh is oriented

to the center of gravity of the

financial universe of the 21st century

emerging is Bitcoin just

like

sorry that falls toward the center of

gravity which is the middle of the earth

and none of you have been

there that doesn't mean that it doesn't

control everybody right everything will

be oriented

in a frame of reference. Yeah. All

right.

Talk about a mic drop. I know. Well, I

love when he brings the heat and then he

just gets back into his kind of like

mildly uncomfortable with it posture.

Back to the autism. Yeah.

AI could 10x global GDP and we know some

of the value will flow into Bitcoin. So,

if GDP grows that much, does that

massively increase Bitcoin's terminal

value in your view?

uh in classical economics they talk

about the economy being driven by land,

labor and

capital. The the consequences of AI AI

is digital intelligence. Bitcoin is

digital capital. The consequences of the

AI is that the AI is going to do the

work of a billion people, then 10

billion people, then a hundred billion

people, then a trillion people. Then

that AI will go into robots and the

robots will do the manual labor of a

billion people and then 10 10 billion

people and then the then it will go into

your cars and your appliances and

everything and and so what's happening

we're going to digitally transform labor

and the demand for labor as we know it

is going to change

fall. The robots don't need as much

space as we need and the AIs don't need

any space. So the demand for land as an

input to the economy will fall by a

factor of 10. The demand for labor as an

factor of a hundred.

What's left? Capital. Capital's going to

explode. you know, you're going to have

massively valuable companies that a

million robots creating a million

I gota I got to say this is an area

where I strongly disagree because

actually capital and the traditional

economic framework he's using

capital includes goods that are useful

for creating other goods. So money is

actually a distinct class from that.

Now, it's not to say you couldn't make

an argument that money is kind of like a

meta capital, like we use money to make

forms of capital. We use capital to make

forms of goods. Like, okay, there's an

argument to be made there. But just for

point of clarification from the Austrian

school, they would not classify money as

capital. So, he's and he's great at

speaking in metaphors and all these

things, but like just to be precise, I

feel like does it seem like from your

perspective, he's looking at Bitcoin

as an asset more than a currency? I

mean, he kind of literally said that. Of

course. Yeah, of course. But I think

he's also just simplifying things for

the audience. It's easier to just say

speak in threes rather than adding this

other anomaly over here called money

that's all confusing and you can build a

whole podcast around how confusing it

is, right? So, but I just had to I felt

compelled to put that point of

clarification there. Robots with like 22

employees that are worth trillions of

dollars don't need the land, don't need

the labor, have the money. Where's the

capital going to flow? it's going to

flow into the Bitcoin, right? I mean, if

you create So, yeah, he's using, I

think, the term capital as like

purchasing power. Like, where is all

economic energy? Economic energy.

Where's all the value going to flow in

this new paradigm, which I do agree

with? The more we automate away all of

these drudgeries and we increase human

productivity, all of that unlocked

purchasing power, what he's calling

capital or economic energy, will flow

into sound money. Yes. And those

productivity gains that AI and robotics

and all these things allow us are going

to be reflected an increase in

purchasing power in the Bitcoin because

we're increasing all of this stuff here

while we're not increasing this. This

thing's convertability into all these

goods or services is going to increase

at a faster and faster rate. That's

exactly right. So again, it's waking up

from the Keynesian hypnosis of prices

need to go up. It's like no, the purpose

of markets is to drive prices down,

right? The price is a social appraisal

of the cost necessary to solve a

problem. Yes, we want to solve more

problems, better, faster, cheaper, and

introduce things that solve problems we

couldn't solve before, right? Like

flying from New York to London was a

problem no one could solve for thousands

of years until we invented the 747 or

whatever airplane to do that. So, yes,

all of that additional problem solving

potential, which we're calling

purchasing power or capital or economic

energy, flows into the hardest asset,

which is Bitcoin. And so as this plays

out, do you think current governmental

regimes and people that make all that up

are going to be pushing for UBI? I mean,

what are we going to do for the people

that are don't have Bitcoin while

they're watching their jobs get taken

away? Things are getting more expensive

because we have this

fiat monetary system that as we're

pushing prices down, they continue

needed to debase at a faster rate to

prop asset prices up because the assets

are collateralizing the debt.

Yeah, I mean we really don't know,

right? You've got uh the collision of

two titanic forces, which is the

exponential productivity gains of

technological advancement colliding with

the exponential debasement of fiat

currency that's trying to erode the real

debt burden of its client, which is

central government. Yeah. And how is

that going to play out? Like I I think

it exposes the bankruptcy of governments

and it also drives their revenues down.

That's why I think again the sovereign

individual Bitcoin makes government

local again, something like that.

Government and politics start being stop

being such a predominant feature of our

lives and our identities. And I mean,

talk about waking up from an illusion.

Like the idea that we can pass laws or

have popularity contests for people to

tell us what to do and that's going to

improve the world. That's the biggest

[ __ ] delusion of them all. And so I

hope Bitcoin just awakens us from that.

Yeah. Yeah. I'm with you there.

By the way, extreme wealth, right?

There's going to be two types of people.

There's going to be the people that

bought the Bitcoin and they're going to

be privately wealthy and they're going

to live off of that or something

something that is denominated in

Bitcoin, right? And then there's going

to be everybody that's getting that's

getting wealth redistributed to them by

political systems. Uh there won't be a

lack of stuff. There'll be infinite

stuff. It'll be redistributed in a

political economic process which will be

interesting.

But the consequences of AI is that it's

going to create massive amount of

capital. And the capital that you're

going to want is digital capital because

it's the best capital and it's the most

useful capital. When the AI thinks a

million times a second and trades with

another AI a million times a second,

they're going to trade with Bitcoin.

They're going to trade with digital

capital a million and a billion times

faster. They're definitely not swapping

buildings. They're definitely not

swapping gold bonds, bars, or coins.

They're definitely not going to trust

anybody else's sovereign credit. They're

not going to trust private credit,

public credit, sovereign debt. They're

not going to use

cash. They're going to use pure digital

capital in cyerspace. So, it's all I

like this too as the new Turing test.

You know, the old tearing test

was how at what point it was thought

that if you could interact with an

artificial intelligence and not be able

to tell whether or not you're dealing

with a human or not on the other side of

the screen, that that was the touring

test. And then if the AI passed that

test, then it would be sentient AGI.

Well, we already have that today. We

have chat GBT and you know, all the LLMs

that are basically that you can't it's

hard to tell if you're doing a human or

not. I actually like this idea as

Bitcoin being the real touring test that

if a if a sentient AI actually ever woke

up, if it did anything other than stack

sats, then it would be a [ __ ]

[ __ ] AI. And like if this thing is

actual sentient, actually sentient and

actually intelligent, then it would be

accumulating sound money obviously to

serve whatever uh ends it may have.

Yeah.

And any of these AIs, you know, if you

have AIS that are working in the states

versus someone that are working in other

jurisdictions, they they have to use a

non-s sovereign instrument because you

have the corruption element, right?

Well, I mean, I think even to his point,

yeah, he's like they're not they're

going to be smart enough not to trust

some counterparty that can debase them

or issue more bonds or issue more fiat

currency. He's like, why would I [ __ ]

take that risk? I'm an artificial

intelligence. I'm smart. Let me use the

money where I don't have to trust

anyone. Right. That's what I'm saying.

That would be an actual useful touring

test. I think that's interesting. I dig

that. Bullish for Bitcoin. Uh and it's

going to drive the price of Bitcoin up.

And it, you know, if you haven't figured

out how to make money by uh putting AI

into your business, that's

hard. Then I give you the easy answer.

You just buy the Bitcoin as much as you

can buy because we know where all the

money is going to eventually go. The

capital is all going to flow in the

Bitcoin network and the and the more

everything else grows, the more Bitcoin

is going to grow. So, you can just go

right there and then wait for the world

to enrich you. All

right. Very, very

bullish. Okay. I think we have time for

one more. By the way, this is all stream

of consciousness. There was no prep.

Michael didn't get these questions ahead

of time. people are texting them in. So,

uh, thank you for participating. So,

Michael, we started this initiative last

year. Accelerating corporate Bitcoin

adoption is is the mission. Uh, this

person asked a great question question.

Prescott, is there a point where one

entity holding too much Bitcoin creates

negative effects on the network or

reduces its utility? No, I think the

network is the protocol is protected by

the des the

distribution of the mining, the

distribution of the the protocol itself,

the distribution of the nodes, the

distribution of the holders, the

distribution of the exchanges and the

distribution of the derivatives and the

distribution of the regulatory bodies on

top of it. That's a global phenomena. um

one company you know what if Black

Rockck holds 3% or 2% of the Bitcoin or

if if Strategy holds two or three or

four or 5% of the Bitcoin it doesn't

matter

because the price of Bitcoin went from

10,000 to 100,000 while we were pursuing

that

2% and that meant that while we pursued

that by the way technically if you go to

Sailor Tracker you will find that that

all of the work that we've done to get

to two and a half percent resulted in

like a $23 billion gain for us, 23

billion, but it resulted in a $2.2

trillion gain for everybody

else. Okay. So, like it's not like I got

the money, right? What is the ratio of