Latest / Simply Bitcoin / Iran, Oil, and What the Petrodollar Breakdown Means for Bitcoin | Beyond Bitcoin

Transcript

Iran, Oil, and What the Petrodollar Breakdown Means for Bitcoin | Beyond Bitcoin · Simply Bitcoin

• 0:00
  Iran shut off the most important oil corridor this week and said
• 0:02
  they'll only reopen if you pay in Chinese yuan.
• 0:04
  You mean dollars, right? No, I mean Chinese yuan.
• 0:08
  But that means that the dollar is exactly my friend.
• 0:12
  And guess what else? Bitcoin moved up.
• 0:13
  While this all happened also big this week, the current Treasury
• 0:16
  Secretary, Scott Bessel said Bitcoin legislation is
• 0:19
  unavoidable. And somewhere in there, Stanley
• 0:21
  Druckenmiller and his $6 billion track record said Bitcoin was,
• 0:25
  quote, sad it ever happened. I'm very sad that it ever
• 0:29
  happened. Sad.
• 0:30
  It ever happened, but all of this is happening in the same
• 0:33
  week. I'm oceans.
• 0:34
  This is beyond Bitcoin. You're going to want to stick
• 0:37
  around for this one. So the Bitcoin price is
• 0:45
  currently, well, you have a computer you can check.
• 0:50
  The Fear and Greed index is sitting in extreme fear right
• 0:53
  now, which is totally normal because if you've been watching
• 0:56
  this channel long enough, you know what that usually means.
• 0:59
  Here's what's actually happening this week, and I want you to
• 1:01
  hear all three of these before I tell you how they connect.
• 1:04
  First, Iran demanded Chinese yuan at the Strait of Hormuz,
• 1:08
  the checkpoint for roughly 1/5 of all global oil flow, and
• 1:12
  Bitcoin outperformed gold that entire time.
• 1:14
  We have the data. We scraped it from the depths of
• 1:17
  wherever Gemini grabs its ones and zeros.
• 1:20
  Also, 14 major banks published research this week saying the
• 1:23
  financial plumbing is breaking. Brent crude crossed $100 for the
• 1:28
  first time since Russia invaded Ukraine.
• 1:30
  Brent crude, by the way, is a mercenary for hire that remains
• 1:33
  in dark circles of the underground resistance.
• 1:35
  Second, the macro conditions that Bitcoin was built for are
• 1:38
  now fully in place. And as I mentioned in my
• 1:41
  previous episode, the Fed is frozen.
• 1:44
  Rates haven't moved. Jerome Powell has six weeks left
• 1:47
  in his job. Let him go, let him go.
• 1:50
  Also, Wall Street is now using Bitcoin ETFs as collateral for
• 1:54
  equity trades. The environment has changed.
• 1:58
  And 3rd, the administration went on record within 48 hours of
• 2:01
  each other. the US Treasury Secretary and the president's
• 2:04
  son both made direct, quotable public statements about Bitcoin,
• 2:09
  not crypto, Bitcoin. And we're going to play the tape
• 2:12
  because that's how we operate here.
• 2:13
  It's simply Bitcoin. We play tapes.
• 2:15
  We're old school. These three stories are really
• 2:17
  just one story. And by the end of this episode,
• 2:19
  you'll know exactly what that story is.
• 2:21
  Before we get into the war and the oil corridors and the yuan,
• 2:25
  I want to start with something a very smart and very rich man
• 2:28
  said this week that makes me smart.
• 2:31
  No, not him. Him, Stanley Druckenmiller, $6
• 2:35
  billion under management, one of the most respected macro
• 2:38
  investors alive. He told Morgan Stanley this week
• 2:41
  that Bitcoin quote is a solution looking for a problem.
• 2:46
  Wait, is that like a compliment, like Bitcoin seeks out bullies
• 2:50
  to beat up or something? Druckenmiller also said.
• 2:53
  Quote, he's sad it ever happened as a store of value, that it
• 2:56
  wasn't needed. Oh no, I guess that wasn't a
• 2:59
  compliment, but he said it this week of all weeks.
• 3:02
  Here it is. But to a point, I think they're
• 3:06
  fine and. Crypto.
• 3:09
  I said this a long time ago and I'm going to say it again.
• 3:13
  It's a solution looking for a problem.
• 3:16
  I'm very sad that it ever happened as a store of value
• 3:20
  'cause it wasn't needed, but it's a brand and these people
• 3:25
  love it, so it's going to be a store of value.
• 3:27
  Wasn't needed. Here's what 0 Hedge published
• 3:31
  the same week. Bitcoin used to be the first
• 3:34
  risk asset to get naked on geopolitical conflict.
• 3:37
  Not anymore. In fact, it is outperforming
• 3:40
  gold since the start of the war. Regime shift question mark.
• 3:44
  A regime shift? Zero.
• 3:46
  Hedge's words, not mine. My language isn't that refined.
• 3:49
  By the way, Zerohedge said this. The same outlet that spent years
• 3:53
  treating Bitcoin like a punchline.
• 3:55
  Yeah. And then TFTC runs this
• 3:57
  historical record. Bitcoin has a history about
• 4:00
  performing S&P 500 and gold during major geopolitical
• 4:04
  events. This isn't a one off.
• 4:06
  It's happened before, during our favorite virus of the past
• 4:09
  century and during our favorite war of the last decade.
• 4:12
  Bitcoin dips first, then it separates, like the brand new
• 4:16
  cheesy sauce from Taco Bell. Good.
• 4:22
  Stanley Druckenmiller said Bitcoin wasn't needed The same
• 4:24
  week Bitcoin outperformed gold during a bombing raid.
• 4:28
  That's either irony or a buy signal.
• 4:30
  It's probably both. But here's why that matters
• 4:33
  beyond just the price. And here's what 14 of the
• 4:36
  world's largest banks published simultaneously this week. 14
• 4:39
  major banks published 15198 research reports this week.
• 4:45
  Every single one is saying the same thing.
• 4:47
  The Iran war is breaking the financial plumbing.
• 4:50
  Brent crude crossed $100 for the first time since Russia invaded
• 4:55
  Ukraine. Largest single day jump since
• 4:57
  COVID. 14 banks 15198 reports. All the same conclusion.
• 5:03
  You could read them all, but honestly you could just look at
• 5:06
  the chart. Here's the context.
• 5:08
  The part most coverage skips, The petrodollar system started
• 5:12
  in 1974. The deal Oil producing nations
• 5:16
  led by Saudi Arabia, agreed to sell oil exclusively to the US.
• 5:21
  Here's the context, and this is the part that most coverage
• 5:23
  skips. The petrodollar system started
• 5:25
  in 1974. The deal was oil producing
• 5:29
  nations led by Saudi Arabia agreed to sell oil exclusively
• 5:33
  in U.S. dollars. In return, the US provides
• 5:37
  security guarantees and buys their debt.
• 5:40
  Pretty good trade. I think every country that needs
• 5:42
  oil has to 1st acquire dollars to buy it.
• 5:46
  Oh wow, that's a very good trade.
• 5:48
  That creates constant structural demand for the dollar.
• 5:52
  And for 50 years that arrangement has been the
• 5:54
  foundation of American financial dominance.
• 5:57
  Not military power alone, not GDP, the dollar.
• 6:00
  But now look what Iran just said.
• 6:03
  Iran just told the world it will reopen the Strait of Hormuz to
• 6:07
  oil tankers, but only if the cargo is paid in Chinese yuan,
• 6:12
  not dollars. Wait, does that have anything to
• 6:14
  do with the war that's happening right now?
• 6:16
  No, no, of course not. This is the clearest signal yet
• 6:20
  that the petrodollar system is fracturing and that Bitcoin's
• 6:24
  value proposition as neutral non sovereign money is proven.
• 6:27
  The Strait of Hormuz, 1/5 of global oil, the most
• 6:31
  strategically critical waterway on earth, and Iran is saying you
• 6:35
  want to get through? Let me get someone you want son.
• 6:38
  Nah, not dollars. You won son.
• 6:42
  Here's why this matters for Bitcoin and why Druckenmiller's
• 6:45
  not needed comment is so perfectly timed.
• 6:48
  The argument against Bitcoin, as money has always been the dollar
• 6:52
  is fine, the dollar is stable, nobody needs an alternative.
• 6:56
  Well that argument had a 50 year run and Iran just publicly ended
• 7:00
  it at the most visible choke point in global energy.
• 7:04
  If the dollar stops being the medium of oil trades, the
• 7:07
  structural demand for dollars goes with it.
• 7:09
  That's not a fringe theory anymore.
• 7:11
  That's 14 banks writing it down in wait, hold on a second.
• 7:15
  Why are 14 banks writing 15198 reports?
• 7:18
  That's like 1100 ports per bank. Who's writing all these reports?
• 7:23
  And more importantly, who's reading them?
• 7:25
  This is what keeps me up at night.
• 7:26
  And The thing is, Bitcoin doesn't need geopolitical
• 7:28
  clearance. It doesn't need a reserve
• 7:30
  currency deal. It doesn't have a central bank
• 7:33
  that can be pressured into accepting yuan.
• 7:36
  You can send it anywhere denominated in nothing but
• 7:39
  itself settled in minutes or seconds depending on how you
• 7:42
  send it. It's neutral, it's non
• 7:45
  sovereign, and there's no permissions required.
• 7:48
  So Stanley Druckenmiller's call that it's not needed, well, I'd
• 7:53
  call it the only thing that is needed when everything falls
• 7:56
  apart. Before we continue, I want to
• 7:58
  tell you about SAT 123.com. Look, if the past few minutes
• 8:02
  have taught us anything, it's that you can't outsource your
• 8:04
  security to institutions that are 1 geopolitical event away
• 8:08
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• 8:17
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• 8:20
  the grid doesn't. And if you go to sat123.com
• 8:23
  right now and you put the promo code simply at checkout, you'll
• 8:26
  get 15% off your entire purchase.
• 8:28
  Stay sovereign. Stay connected with sat123.com.
• 8:32
  I want to talk a little bit about the environment Bitcoin is
• 8:35
  operating in right now because it's exactly what it was
• 8:37
  designed for. The Federal Reserve is holding
• 8:40
  rates at 3 1/2 to 3 1/4%. They haven't moved.
• 8:46
  They can't move. If they cut too early, inflation
• 8:48
  comes back. If they hold too long, the
• 8:50
  economy stalls. And Jerome Powell has six weeks
• 8:54
  left in his job. The man who spent years calling
• 8:56
  Bitcoin a speculative asset is almost gone.
• 8:59
  And meanwhile this should be a bigger story than it is.
• 9:02
  Bitcoin ETFs are now being used as collateral for Wall Street
• 9:06
  equity trades. The SEC approved cross margining
• 9:09
  between crypto ETFs and traditional equity positions.
• 9:13
  Wall Street built a door into Bitcoin to get out of dollar
• 9:16
  risk, and now they've decided to use that same door as a floor to
• 9:20
  trade against. Think about it, $95 billion in
• 9:23
  Bitcoin ETFs. That's the institutional floor
• 9:26
  right now. It doesn't evaporate because of
• 9:28
  news cycle. It's collateral.
• 9:30
  And you want to know what's happening to retail while the
• 9:32
  institutions are building their position?
• 9:33
  Extreme fear. According to these pixels on
• 9:37
  your screen, retail is scared. Institutions are accumulating.
• 9:41
  The gap between people who understand what's happening and
• 9:43
  the people who are still staring at the 30 day chart is wider
• 9:47
  than it's been in a long time. This is the macro environment.
• 9:51
  Bitcoin was designed for a frozen central bank, a
• 9:54
  depreciating reserve currency under geopolitical pressure.
• 9:58
  A financial product that $95 billion of institutional capital
• 10:03
  has already decided is worth owning.
• 10:06
  Do you think that's an accident or you think maybe those 14
• 10:09
  banks writing 15198 reports about broken plumbing know
• 10:14
  something the Fear and Greed index doesn't know?
• 10:16
  Also, the Treasury Secretary of the United States said something
• 10:19
  this week that I don't think most people fully absorbed.
• 10:22
  Scott Besant, the Treasury Secretary, the hottest Bitcoin
• 10:24
  influencer right now, who's not a Bitcoin influencer, just said
• 10:27
  quote, I think that it's impossible to proceed without
• 10:31
  Bitcoin market structure. We have to get across the finish
• 10:34
  line. Impossible to proceed without
• 10:36
  Bitcoin market structure. Of course it's impossible to
• 10:38
  proceed. The Strait of Hormuz is still
• 10:41
  closed for the dollar. That's why my gas prices are so
• 10:44
  high this week. That's not a commitment to hedge
• 10:46
  fund crypto portfolios. That's the Treasury Secretary of
• 10:49
  the United States saying Bitcoin legislation is an optional.
• 10:53
  It's preconditional. You don't move forward in this
• 10:56
  financial environment without a clear legal framework for
• 10:58
  Bitcoin. And you don't move forward your
• 11:01
  oil tanker without some fresh yuan, son.
• 11:04
  Bitcoin went from magic Internet money to treasury priority
• 11:07
  inside one administration. That's good, right?
• 11:10
  And within 48 hours, the president's son said this.
• 11:13
  I've got more conviction in cryptocurrency right now than
• 11:17
  ever before. Volatility is our friend.
• 11:21
  In fact, I've got more conviction on cryptocurrency
• 11:22
  right now than ever before. OK, cryptocurrency, Sure.
• 11:27
  But then he went further. The premise of this is the whole
• 11:30
  system is, is genius, right? You're using massive compute
• 11:33
  power to otherwise kind of protect the financial system of,
• 11:37
  of, of an asset that's beyond scarce that everybody wants,
• 11:40
  that's global and solves all the problems that I mentioned
• 11:43
  before. You know, again, you want to buy
• 11:44
  something, you know, you, you could send me $1,000,000 for the
• 11:47
  Bitcoin right now. We could hit my wallet in three
• 11:49
  seconds and you practically pay 0 fees.
• 11:52
  Like tell me that every financial institution in the
• 11:54
  world isn't pissed off about that.
• 11:55
  They, they want to extract the fees.
• 11:57
  They they want as many middle as humanly possible because that's
• 12:00
  what keeps their seventy story buildings late and alive and and
• 12:03
  their their CEO's making hundreds of millions of dollars
• 12:05
  a year. You're pretty much bypassing all
• 12:07
  of them. And I, I think that's, I think
• 12:09
  it's a great thing in terms of, you know, kind of financial
• 12:11
  democracy. I think that's a really, really
• 12:13
  good thing for for humanity. Do I need to remind you that
• 12:16
  that's the president's son on camera explaining why banks hate
• 12:20
  Bitcoin? You could send $1,000,000, three
• 12:22
  seconds, zero fees, and every bank in the world, well, I can
• 12:26
  imagine they're furious about it.
• 12:28
  That's not a value proposition as much as it is a confession
• 12:32
  from inside the White House. The banks are pissed off because
• 12:34
  it works and it works without them.
• 12:36
  And it's not just the US, there's also Taiwan.
• 12:39
  A sitting legislator is publicly pushing the government to
• 12:42
  establish a strategic Bitcoin reserve.
• 12:44
  The Taiwanese government already has 210 Bitcoin in custody, and
• 12:48
  the central bank is officially studying the mechanics of
• 12:51
  sovereign adoption. You know, if you're a central
• 12:53
  bank, just the damn money and buy as much of the stuff as you
• 12:56
  possibly can. I mean, who's who's going to be
• 12:58
  first to figure that one out? Come on.
• 12:59
  This is the sovereign adoption wave that we've all been
• 13:02
  discussing. El Salvador started it. the US
• 13:04
  is now on record. Taiwan is studying it.
• 13:07
  And that's how the sequence of events occurs.
• 13:09
  But really, we all know Bitcoin's adoption is a bottom
• 13:12
  up movement, not a top down. So it's no surprise that central
• 13:16
  banks aren't just going full tilt.
• 13:18
  And here's the timeline that you bother the skeptics.
• 13:20
  Bitcoin launched in January 2009.
• 13:23
  That's 17 years of network effects, 17 years of blocks
• 13:27
  mined, nodes running, developers building companies forming.
• 13:31
  Bitcoin is older than the iPad. I did not know that.
• 13:34
  Older than Instagram, older than most of what people are
• 13:37
  interacting with online every single day.
• 13:39
  And here's Druckenmiller saying it wasn't needed in a year 17 of
• 13:45
  a network that has never gone down, never been successfully
• 13:48
  attacked, and never stopped producing blocks.
• 13:50
  Not once, the obituary writers. They've been wrong every single
• 13:54
  time, and they have 17 years of chances to be right.
• 13:57
  But here's what they missed. If the past few minutes have you
• 14:00
  thinking seriously about self custody, about actually holding
• 14:03
  your own Bitcoin without relying on an exchange or an institution
• 14:06
  that could break down or disappear tomorrow, the Bitcoin
• 14:10
  Way makes that transition simple and safe.
• 14:12
  They onboard people into Bitcoin self custody, one-on-one, step
• 14:15
  by step, so you're not figuring it out all alone.
• 14:19
  And if you go to thebitcoinway.com/beyond
• 14:21
  Bitcoin, you can book a free 30 minute consultation with one of
• 14:25
  their team members. Link in the description below.
• 14:27
  That's the bitcoinway.com/beyond Bitcoin for a free 30 minutes
• 14:31
  consultation. It's free, that's it.
• 14:34
  Moving on. On Saturday morning, Michael
• 14:36
  Saylor posted on X stretch the orange dots.
• 14:38
  What the hell does that mean? For context, Sailor tracks every
• 14:41
  strategy Bitcoin purchase on a chart.
• 14:44
  Each purchase is an orange dot. The bigger the purchase, the
• 14:47
  bigger the dot. And recently he posted a very
• 14:50
  large orange dot. What followed estimates as high
• 14:53
  as 25 to 30,000 Bitcoin, up to $2 billion worth of Bitcoin this
• 14:58
  week alone of a purchase that would bring sailors total
• 15:01
  Bitcoin holdings to above 6, 700 seven 160,000 Bitcoin.
• 15:07
  Geez, now this is week 1313 consecutive weeks without
• 15:11
  missing a single purchase, not one the They'll stop eventually.
• 15:17
  Crowd might be looking at their shoes right now and wondering
• 15:19
  how they're going to leave the room.
• 15:21
  What Sailor is doing isn't just buying Bitcoin, it's proving out
• 15:24
  the corporate sovereign accumulation thesis, the idea
• 15:28
  that a company can build a balance sheet around an
• 15:30
  appreciating asset and issue financial instruments around it.
• 15:34
  That flywheel, every dot is a data point that the model works
• 15:38
  with. And he's not alone anymore.
• 15:40
  Adam Back's company BSCR just announced they're about to
• 15:43
  purchase up to 1 1/2 billion dollars in Bitcoin 21,000
• 15:47
  Bitcoin. The corporate accumulation wave
• 15:50
  is no longer just strategy, it's category.
• 15:53
  Like the joke there strategy category, bears will be bearish
• 15:59
  until they have no choice but to be bullish, and bulls will be
• 16:03
  bullish until they have no choice but to sell their chairs.
• 16:07
  Last week, something that only happens once happened Block
• 16:10
  939,999 mined by Foundry USA, the block that pushed total
• 16:17
  circulating Bitcoin supply past 20 million coins. 20 million
• 16:21
  Bitcoin out there. Out of the 21,000,000 total that
• 16:23
  will ever exist, 95.2% of all Bitcoin that will ever be mined
• 16:28
  is now already mined. There's only 1,000,000 left.
• 16:31
  Those 1,000,000 coins will take approximately 114 years to mine.
• 16:36
  And when you factor in lost coins, wallets nobody can
• 16:39
  access, early miners who had no idea what they had, the effect
• 16:43
  of circulating supply is probably somewhere between 16
• 16:46
  and 18,000,000, maybe even less. 1% of the total supply remains
• 16:50
  minable before the next 100 years are up and the door is
• 16:53
  closing. Here's the part I want you to
• 16:55
  actually hear. Drunken Miller said Bitcoin
• 16:58
  wasn't needed this week. The same week Iran stopped
• 17:01
  taking dollars at the world's most important oil corridor.
• 17:04
  The same week, 14 banks said the financial plumbing is breaking
• 17:08
  in 1500 and 98 reports. The same week the Treasury
• 17:14
  Secretary said you cannot move forward without Bitcoin market
• 17:17
  structure. The same week Bitcoin
• 17:19
  outperformed gold during a live geopolitical conflict.
• 17:22
  And the same week we crossed 20 million coins mined.
• 17:28
  Wasn't needed. The petrodollar system that was
• 17:30
  supposed to be the permanent foundation of global trade just
• 17:33
  sharded. the Fed chair is walking out the door.
• 17:36
  Wall Street is using Bitcoin as collateral, the president's son
• 17:39
  is explaining Bitcoin settlement speed on camera, Taiwan is
• 17:43
  studying a sovereign reserve, and there are 1,000,000 Bitcoin
• 17:46
  left to mine over the next century.
• 17:49
  The scarcity argument is no longer theoretical.
• 17:52
  It is written into the math of every block from here on
• 17:56
  forward. The system that was supposed to
• 17:58
  protect your wealth is breaking down on every front
• 18:01
  simultaneously. The dollar lost its grip at
• 18:04
  Hormuz. the Fed is paralyzed. The institutions are building
• 18:08
  their Bitcoin positions while retail panics.
• 18:11
  And the administration has gone on record saying Bitcoin is kind
• 18:15
  of the answer. The people who are actually
• 18:17
  running these systems are doing everything they can to
• 18:19
  accumulate more. So for God's sakes, study some
• 18:23
  Bitcoin. So before I sign off, I want to
• 18:24
  talk about Club Orange is formerly known as the Orange
• 18:26
  Pill app. It's the premier app for
• 18:30
  bitcoiners to connect, argue with each other, or just have
• 18:34
  normal discussions. I've connected with a lot of you
• 18:36
  on there already. I even connect with what's his
• 18:39
  name, Hodlin Tees. Hodlin Tees sent me this
• 18:43
  awesome, awesome hat. Thank you Hodlin Tees for this
• 18:46
  awesome hat. Anyway, Club Orange, that's
• 18:48
  where we connected. If you want to find me there,
• 18:50
  I'm at Oceans OSHINSI. Read all my DMS and I answer
• 18:55
  accordingly, so we'll see you there.
• 18:57
  Club orange.org. Here's what I keep coming back
• 19:00
  to this week. Druckenmiller.
• 19:01
  He's not stupid. He's a little drunken Miller,
• 19:04
  but he's not stupid. He's one of the sharpest macro
• 19:06
  minds in his generation. He managed money for decades at
• 19:10
  the highest levels, and he looked at the same week that I'm
• 19:12
  looking at the same war, the same yuan demand, and the same
• 19:16
  Treasury Secretary quote and said Bitcoin wasn't needed.
• 19:20
  That's not ignorance. That's a map that doesn't match
• 19:23
  the territory anymore. The map he learned, the one
• 19:26
  where the dollar sits at the center of everything.
• 19:29
  Well, that doesn't have a route for what's happening right now.
• 19:31
  It's closed off and it requires Juan to get through.
• 19:36
  Bitcoin doesn't ask for permission to be relevant.
• 19:38
  It doesn't need Stanley Druckenmiller to believe in it.
• 19:41
  It's just there, reducing blocks every 10 minutes, whether or not
• 19:44
  the Strait of Hormuz is open or not, whether or not the Fed
• 19:48
  chair shows up or not, whether or not the Treasury Secretary
• 19:51
  votes yes or not. 20 million coins mined, 114 years of supply
• 19:57
  left. The irreversibility is the
• 19:59
  point. That's not a bug.
• 20:00
  That's the feature that makes everything else work.
• 20:03
  Thank you so much for watching this video.
• 20:04
  If you like what you see and you want to see more, make sure you
• 20:06
  hit that like button below or you can subscribe to the Simply
• 20:09
  Bitcoin channel for more content like this.
• 20:11
  We're coming out with it every. Single day of the week, you can
• 20:13
  leave us a comment. Don't forget to hit that
• 20:14
  notification bell. Anyway, I'm oceans.
• 20:16
  This is beyond Bitcoin. If you want to reach out to me
• 20:18
  directly, I'm Rundance Bitcoin on X.
• 20:22
  Until next time.