Latest / Simply Bitcoin / Could Bitcoin 100x in 10 Years? | Peter Dunworth Explains the Math

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Could Bitcoin 100x in 10 Years? | Peter Dunworth Explains the Math · Simply Bitcoin

0:00
This is not going to be popular with the Bitcoiners, but I think
0:03
we are going to have a Trojan horse with Bitcoin adoption and
0:06
it will come through the treasury companies.
0:08
When I talked to Jeff Booth, I think his price was $43 million
0:11
per coin. Could you talk a little bit
0:13
about that, Peter? Right.
0:14
This this thousand X potential that you see in Bitcoin still I
0:18
think. We've got a 10X in the next five
0:19
years and 100 X in the next 10. Wow.
0:22
There are 8 billion people in the world, and there are only 10
0:24
million people who understand that Bitcoin is a need.
0:27
So 8 billion people need this. Only 10 million people
0:30
understand that to be true. I love that.
0:33
I love that. I love that line.
0:35
If the Treasury companies are outperforming Bitcoin, why would
0:40
you advise your clients to buy spot?
0:43
Great question because. So you are.
0:47
That's very interesting. So you think, wow, OK.
0:51
The big thing that I look at here is, is that we have had
0:53
Wall Street speculate with Main St.
0:55
Consequence and Bitcoin is the first asset, commodity, whatever
1:00
you want to call it, that divorces Wall Street speculation
1:02
from Main St. Consequence.
1:04
You think the days of the 2017 era days are over where you got
1:09
20X in a year? You think those days are long
1:12
gone? I do until I don't and this is
1:14
where since. What do you what do you mean by
1:17
that? Yeah.
1:22
Welcome to another episode of Simply Bitcoin Live.
1:25
No, it's not simply Bitcoin Live, it's simply Bitcoin IRL.
1:27
And today I'm joined with Peter Dunworth.
1:30
Peter, thank you so much for joining me.
1:32
I always enjoy our conversations and you absolutely blow my mind
1:37
every single time. It's great to be with in the
1:41
car. Looking forward to another catch
1:42
up. Absolutely.
1:44
So Peter, it's been a crazy year in Bitcoin from a news
1:49
perspective, from a regulatory perspective, you have the United
1:53
States of America basically saying, hey, we want to be the
1:56
Bitcoin capital of the world. You have a tremendous amount of
1:59
institutional interest. You have Larry Fink, the most,
2:03
the most, the most popular ETF in history is the Bitcoin ETF.
2:08
Not really surprising there. So we have all this
2:10
institutional interest and demand, but from a price action
2:15
perspective, specifically the year after the halving is when
2:19
Bitcoin tends to go parabolic. It it does this parabolic trend
2:23
right or this parabola that seems to have not been the case
2:27
this year. What's your take on that?
2:30
I think there are some exogenous factors to this, I guess halving
2:36
cycle that I think weighs heavily on this cycle way more
2:40
than the previous cycles for a number of different reasons.
2:43
Obviously, this halving cycle means that there's a
2:46
significantly less reward. So the inflation has dropped
2:48
dramatically to almost a de minimis amount that that really
2:52
isn't going to affect the supply moving forward.
2:56
The other thing that I think is a big factor that that we've
2:59
seen is we've now seen Bitcoin into the political realm, the
3:03
approval, regulatory oversight, endorsement from the current
3:07
administration, the trade wars, tariffs that are basically being
3:12
pushed out to effectively a global reset of the economy.
3:17
This is affecting liquidity. It's all I think driven in large
3:22
part with the administrator, the current US administrations need
3:27
to win the midterms and create an economic boom into that
3:31
period, which is kind of delaying, I think in pushing out
3:34
this Bitcoin cycle. It's it's very different to any
3:37
previous ones. And I think a lot of people are
3:39
worried or concerned thinking that, oh, we're not going to
3:42
have the, the bull cycle that we've previously had.
3:44
And I think that's true. We're still going to have a bull
3:47
cycle. It's just going to be an
3:49
elongated cycle where this is stretched over a much longer
3:51
period of time that we're not familiar with.
3:53
And I think therein lies the risk of sort of thinking that
3:58
we're in A202122 type cycle where we have an FTX double top
4:03
and then it sort of ramps off and people are in disbelief.
4:06
I, I don't think that's the case.
4:08
We've got institutional money that's here.
4:10
We've got a whole host of capital that's sitting on the
4:13
sidelines waiting to come into the market.
4:15
And I look at this and think how long it takes to educate each
4:19
part of these markets. And I think these are sustained
4:22
capital flows that can last for the next 5 or 1020 years.
4:25
And we're literally only just seeing the start of it.
4:28
And I I think a problem most Bitcoiners have is that we
4:32
forget how naive and how little we knew when we first got to the
4:35
space. And sadly, everyone has to go
4:37
through that learning phase in order to start allocating
4:39
capital to it. And the institutional markets
4:42
are no different. Yeah, absolutely.
4:44
And, and, and, and you're not the first person I've heard this
4:46
from, Peter. The the idea of this elongated
4:50
cycle, right? This idea that we're kind of in
4:53
uncharted territory. You know, the Fed has interest
4:56
rates high. There's what I'm perceiving,
4:59
what I'm seeing is there's kind of like the Civil War going on
5:02
right now for control over the Federal Reserve, right?
5:05
Trump is, you know, for the first time, and I think it's
5:08
like 111 years, basically firing a Federal Reserve governor for
5:14
'cause he wants interest rates to go down.
5:18
We know the Federal Reserve didn't act in a neutral fashion
5:21
during the previous administration with Operation
5:24
Choke .2 Point O. They were heavily involved.
5:27
So I see this kind of tug in war to like tug in war kind of
5:31
process between the administration and the Federal
5:34
Reserve and Trump trying to basically take control over it
5:40
to like basically force these interest rates to go lower.
5:43
And you did mention the the midterms coming up.
5:46
I think, and this is just a theory that they're trying to
5:50
delay as much as possible a booming Trump economy because
5:56
that I think would make the the current party look very good.
6:00
And I think the feds trying to drag their feet as much as
6:03
possible. I want to get your take on that.
6:06
I, I think that makes perfect sense.
6:08
The, you know, Trump, Trump's rudderless if he doesn't win the
6:12
midterms and he can't get through any of his agenda.
6:15
So his number one priority is making sure that he has a, a
6:18
resolute victory in in the midterms next year.
6:22
And the issue that brings is in order to get or increase his
6:26
chances of winning in the midterms, he needs to have a
6:28
booming economy. Now, if, if, if he shoots his
6:32
shot early and we peak this year and then we sort of decline into
6:37
the midterms, that's very disadvantageous for him.
6:40
That doesn't bode well for him at all.
6:43
And if he's going to rant through and push his agenda, I,
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I dare say that the majority of Bitcoiners would be very
6:48
supportive of his agenda because for the first time in Bitcoin's
6:51
history, we have a supportive president of, of Bitcoin.
6:55
But being calculating on this, he needs to delay that as long
6:59
as possible because he wants to be absolute peak economy coming
7:01
into those midterms. So everyone's feeling happy and
7:03
giddy and positive on the outlook.
7:06
And they want, you know, another three years or four years of
7:08
that. Yeah, it's it's very kind of
7:11
interesting, interesting times that we're living in, Peter.
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One of the things that is a fan favorite when you come on the
7:19
show and it's very, it's a very unique outlook into how you look
7:25
at Bitcoin. And I think this cycle
7:28
specifically, I think a lot of people are, you know, a little
7:33
bit disappointed, but you explained your reasoning as to
7:36
why, you know, the best is yet to come.
7:39
This is just a little bit delayed.
7:41
Bitcoins in in Bitcoins history, Bitcoin has never kind of gone
7:45
through this type of business cycle slash market cycle.
7:48
But one of the things that I absolutely love you talking
7:52
about because it's, it's such a unique outlook and the way that
7:55
you describe it is, is fantastic.
7:57
Is one of the things that you've, you've claimed when you
8:00
come on the show is you still think that there's 1000 X in
8:03
Bitcoin, right? And when people hear that
8:07
initially, you know, they, they get shocked a little bit.
8:10
They get, they get kind of, you know, get caught kind of flat
8:13
footed, so to speak. I, I don't believe you're the
8:16
only one to say this, by the way.
8:17
I think when I, when I talked to Jeff Booth, I think his, his
8:21
price was $43 million forty, $3,000,000 per coin, right.
8:26
So could you talk a little bit about that, Peter, right.
8:28
This this thousand X potential that you see in in Bitcoin
8:33
still. It's jumping and and it does
8:36
sound outrageous, but let's put this in in a perspective.
8:39
When we first started advising clients 10 years ago to buy
8:41
Bitcoin just under actually was just on nine years.
8:47
Our clients are sitting on nearly A200X return since I
8:51
purchased less than 10 years ago.
8:53
And so to to break this down into chunk size bites that we
8:56
can all process that's palatable.
8:59
Looking forward, I think it's fair to assume that we're going
9:01
to have half the return over the next 10 years given the fact
9:05
that we now have a whole host of tailwinds coming over the next
9:09
10 years. We have regulatory approval,
9:11
government endorsement, a bond market that's hungry for for
9:15
yield. I can talk to, you know what,
9:17
what that looks like by by way of flows, but that basically
9:21
moves moves US100X over the next 10 years and then work within
9:26
spitting distance of 1000 X from there.
9:28
That's only another 10X from where we are.
9:30
And so I look at this and think the use case for Bitcoin to
9:35
solve a huge amount of our problems, monetary and financial
9:40
fiscal problems within the governments is so understated
9:43
right now that once people comprehend how we can use this
9:47
tool to solve a lot of our problems, we're going to see an
9:50
immense amount of capital, capital flows into this.
9:54
And, and I look at all around, you know, the, the use cases,
9:58
the primary use cases that I see that will lead us to that
10:03
thousand X return. The number one that I look at is
10:06
we're going to see Bitcoin used as pristine collateral to
10:09
effectively recapitalize our entire financial markets.
10:13
The the big thing that I look at here is, is that we have had
10:16
Wall Street speculate with Main St. consequence and Bitcoin is
10:21
the first asset commodity, whatever you want to call it,
10:25
that divorces Wall Street speculation from Main St.
10:28
Consequence. And what does that mean?
10:30
This means that Wall Street can put an infinite amount of value
10:34
and the government can put an infinite amount of value into
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this asset. It can go up exponentially.
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It can go up 1000 X from here, 10,000 X.
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It doesn't matter because the problem that that the
10:44
governments are going to solve by doing that is it's going to
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divorce Wall Street speculation from Main St.
10:49
Consequence. Up until this point in history,
10:52
we haven't had a way of doing that.
10:54
And there are bigger, I guess, implications for doing that that
10:58
lead to, I guess, peace, prosperity, you know, the
11:00
removal of the need for war. But most importantly, this is a
11:05
way to recapitalize our banking system.
11:07
And when the government can create an infinite amount of
11:09
money, Bitcoin can store an infinite amount of value.
11:12
And so I think it's very realistic for us to see 1000 X
11:15
return in Bitcoin over the next 20 years.
11:18
So much to break down there. This is why I love you coming on
11:22
the show. OK, so you think it's going to
11:26
take 20 years though? You think the days of of the
11:31
2017 era days are over where you got 20X in a year?
11:36
You think those days are long gone?
11:41
I do until I don't. And this is where what do you
11:44
what? Do you mean?
11:44
What do you mean by that? Those, those days are over until
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they're not. And, and this is where this is,
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you know, the comical thing about this is, is that when
11:54
you're dealing with absolute digital scarcity, there's no way
11:57
of actually modelling that. And when you have a whole host
12:01
of Bitcoin hodlers, you now have treasury companies that are
12:04
hodlers, you've got ETFs that are hodlers.
12:06
All of a sudden you, you, you combine it digitally scarce
12:11
absolute digital scarcity with a huddle, huddle brigade.
12:15
And then in addition to that you are now getting Bitcoin, I guess
12:18
credit markets and collateral markets built out on the back of
12:21
it. We, we very soon get to a point
12:24
in time where there's no Bitcoin available for purchase.
12:27
And that, that that is the point whereby, OK, the days of 17 or
12:32
20/20/17 to the 20X return are over until they're not.
12:36
And then all of a sudden this thing goes exponential.
12:38
And we're looking at, I think it was wicked smart S curve, which
12:41
I absolutely love, where it looks like a, a parabola with,
12:45
you know, descending returns. And then it just reaches an
12:47
inflection point where it literally goes exponential.
12:51
And, and this is the thing that it's all hearsay until it
12:56
actually happens. And so I think everyone's been
12:59
ultra conservative to say, oh, those days are over.
13:02
We're never going to say that again.
13:04
And that's the sensible thing to say.
13:07
But no one really has a crystal ball on this and no one has
13:11
model absolute digital scarcity before.
13:13
And so given what I know about Bitcoin, when it comes to what
13:18
that actually represents, Bitcoin is a human need, not a
13:21
want. Most people think it's a want
13:23
because they want to get rich. But when they when they actually
13:25
get there, they understand that Bitcoin is a need.
13:29
When 8 billion people figure out that this is a need, not a want,
13:32
then we go exponential and that that tipping point or that
13:35
inflection curve on that diminishing returns will will
13:38
break and it'll break to the upside and.
13:40
When do you think that's going to be Peter?
13:42
And I know, I know that no one has a crystal ball, no one has a
13:48
crystal ball, but when do you think, when do you think that
13:51
realization is going to happen, right?
13:54
And, and just to provide a a bit of context, right, again, the
13:57
United States, this current administration has shown their
14:02
commitment towards the industry, the institutional side of
14:06
things. There's Bitcoin treasury
14:07
companies popping up on literally every, every country
14:11
on planet Earth is coming up with a Bitcoin treasury company
14:14
at this point. So the institutional demand is
14:17
there. When, when in your mind, like
14:20
when is this, when is this inflection?
14:22
When is this singularity? When is?
14:23
When is this? When is this inflection point
14:26
going to happen? I, I think we'll start to see it
14:30
in 10 years, 10 years. We've heard Sailor talk about a
14:32
10 year gold rush. He, he, I, I think he
14:35
understands what's happening. Basically it's a free for all
14:38
until then, how does he get as much Bitcoin as possible?
14:40
We should all have that same mentality.
14:43
Basically it's a 10 year, 10 year gold rush.
14:46
And, and I look at that and I think 2035 we will see the start
14:49
of that inflection point. Those who can see it will see it
14:52
at that point in time. And then over the over the next
14:55
5 to 10 years, it will become a no brainer.
14:58
It will be like looking back, you know, in 1995 and saying,
15:01
oh, of course we're going to have computers in every house in
15:03
every school. But you know, in 1980 that
15:05
wasn't, that wasn't a sure thing or a given thing.
15:07
You know, that was laughed off by, you know, when Bill Gates
15:10
and C Drive said it's going to be in every house a, a computer
15:14
in every house. Everyone laughed at them and
15:16
thought they were crazy. But now everyone looks back on
15:19
that and says, oh, of course that was going to happen.
15:20
So I look at this and think if if you had a teen eye, you can
15:24
see what's happening. I think it's inevitable.
15:27
It's just a matter of when, not if.
15:29
Yeah, I I think that's a good point.
15:31
And what, what, why the so and what do you think is going to
15:35
happen? That's fascinating.
15:38
So the S curve is going to hit in 10 years is the argument that
15:43
you're making. What's going to happen between
15:45
now and 10 years from now in terms of price action if you
15:50
have clients asking about it, I think.
15:54
We've got a 10X in the next five years and 100 X in the next 10.
15:57
OK, gotcha. And, and I think a lot of people
16:01
get lost on the fact that those are what I believe to be fairly
16:06
conservative assumptions. I look at that and think we've
16:09
seen a 200X return in the last nine years.
16:12
It's not difficult to assume that we're going to have 100X
16:15
half the return in a longer period of time, 10 years.
16:18
And I think a lot of people get lost on the fact that we're now
16:21
entering a market where there are pools of capital that are so
16:24
deep we can't comprehend it. On a digitally scarce asset,
16:27
Bitcoin is insignificant. On a global scale, it's less
16:30
than 2 1/2 trillion dollars with $900 trillion of assets running
16:35
around. And you know probably one of the
16:37
most important movements that it's probably going to take the
16:40
next four years to come to market the preferreds that
16:43
sailors offering with strategy. That's probably going to take
16:46
four years to educate that market and actually get to the
16:50
point where he can actually sell that at Skype.
16:53
If I look at, you know, where he where he was five years ago, it
16:57
took him four years to get to the at the market offering that
16:59
he did where he did 42 billion and all of a sudden that was all
17:03
we were talking about. Look at sailor buying so much.
17:05
Well, this credit market that he's going after is, I don't
17:09
know, somewhere between 2:00 to five times bigger depending on
17:11
how you assess it. And he's offering a product
17:14
that's twice as good and has much better, much less risk
17:18
involved with it. If you understood and peeled
17:20
back what that was, but it's going to take him four years to
17:22
educate the market. I look at that and I think,
17:24
well, he could have half a trillion dollar offering in four
17:28
years time. And you know that that
17:30
represents a a perpetual bid in the market.
17:33
And that's just going to be a rolling facility because when
17:36
the credit teams understand what that offering is, they realise
17:39
that that's actually, on a risk adjusted basis, a much better
17:42
offering than what the Federal Reserve's offer.
17:46
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18:24
So, Peter, can you talk about it?
18:26
Because you, you bury the lead there.
18:28
When, when you right in the very beginning, when you said there's
18:31
pools of capital that Bitcoiners can't even comprehend that are
18:35
out there. Could you, could you elaborate?
18:37
Like what do you mean? Like what?
18:39
What are we talking about here? I, I think we all do our numbers
18:42
and we, we really don't comprehend how little capital is
18:46
required to move Bitcoin when it's not selling.
18:49
And So what needs to happen in order for these pools of capital
18:55
get really excited and start moving.
18:57
We're seeing the foundations of that regulatory approval,
19:00
government endorsement, strategic Bitcoin reserve.
19:03
But these pools of capital are so large, so deep, so liquid,
19:08
they're thousand times bigger than than what what the Bitcoin
19:11
market is. You you look at what's traded on
19:13
the forex on a daily basis, it's surface $7 trillion of trading.
19:17
That'd be 100 to 1000 times bigger than the daily trading
19:20
volume of Bitcoin. All of that trading is going to
19:23
migrate to Bitcoin at some point in time.
19:25
And this is, you know, on a really rudimentary basis, I look
19:28
at this and I think when there's absolute digital scarcity, when
19:32
no Bitcoin is for sale and we have credit markets that are
19:35
enabling anyone who wants to to never sell their Bitcoin.
19:39
We then get to a point in time when we achieve full hyper
19:42
bitcoinisation that no one in their right mind who's basically
19:46
selling a good or service will take anything other than Bitcoin
19:50
for that. And I looked at this and I think
19:52
today in today's numbers, not to mention the inflation that's to
19:56
come and the productivity boom that we're going to see with AI
19:58
and all the other numbers that. You know, basically showed that
20:02
this number will grow significantly over the next 10
20:04
to 20 years. You know, we've got $7 trillion
20:07
of daily global trade and we've only got 450 Bitcoin minted on
20:11
the dot. By my logic, if we've got all of
20:14
that Bitcoin tucked away that no one's selling, we need to
20:17
facilitate $7 trillion worth of transactions on a daily basis
20:21
with whatever's minted on the day.
20:23
And so I look at that and think, this is where things are going
20:28
to become surreal because there's no way of really.
20:31
And this is where, you know, friend of the show and friend of
20:34
mine, Jeff, Jeff Booth, I think he's got the greatest outlook on
20:37
it. You can't measure the new system
20:40
from within because it's a completely different paradigm.
20:42
We can talk about numbers all we want, but it's going to look
20:44
completely different to what we think.
20:46
Oh, all I can tell you is that that number's going to go up
20:48
significantly more than we think.
20:51
Yeah. And the and.
20:53
OK, so there's huge pools of capital that Bitcoin hasn't
20:59
tapped into sailors in the process of rolling out products
21:05
that it's going to take him at least four years to educate the
21:08
market on. When everyone realizes Bitcoin
21:12
is a superior asset, a lot of that capital is going to go into
21:17
Bitcoin. I'm trying to comprehend all the
21:19
things that that you're saying and what what is that process
21:26
going to be like, Peter? Like are, are most people that
21:30
get exposure to Bitcoin? Is it going to be through the
21:34
ETFs? Is it going to be through
21:37
Bitcoin treasury companies? Is it going to be through spot
21:41
Bitcoin? What's your take on that?
21:46
Oh, this is this is not going to be popular with the Bitcoiners,
21:50
but I think we are going to have a Trojan horse with Bitcoin
21:54
adoption and it will come through the treasury companies.
21:57
If sailors included into the S&P 500, then every pension fund in
22:02
the US is going to have that whether they like it or not.
22:06
So technically that would would mean greater adoption than the
22:11
the the spot Bitcoin owners. But I think this is a Trojan
22:14
horse that basically puts another layer at the top of the
22:17
funnel. They invest in this, they now
22:19
all of a sudden have skin in the game.
22:20
And then that's the impetus to basically learn about Bitcoin.
22:23
And as we all learn about Bitcoin, we move gradually
22:26
deeper down that rabbit hole that we go from wanting some
22:30
paper Bitcoin exposure, whether it's an ETF or through strategy.
22:33
And then once you understand that, you realise, hang on a
22:35
second, there's actually some really good things about this
22:37
that is not just about number go up.
22:39
There's actually some freedom go up technology to this too that I
22:42
would like to have some control over.
22:44
So I think it starts there. That's the broadest mass appeal
22:48
that we can have because that's that's the least friction to
22:52
onboarding people in the Bitcoin.
22:54
And then once people learn about it, they then descend down the
22:57
rabbit hole and and and turn into spot Bitcoin buys.
23:01
OK. So you think that the Bitcoin
23:03
treasury companies are a Trojan horse into spot Bitcoin?
23:09
And then my question is Michael Saylor's strategy, I think AT25X
23:14
in a period of like 2 years, would you recommend, if you had
23:19
a client, would you recommend them buying strategy or would
23:23
you recommend them buying spot Bitcoin?
23:26
I'm, I'm a little bit biased here, but I recommend they buy
23:28
spot Bitcoin. I think buying spot Bitcoin and
23:33
owning that for say a min period of eight years will give you a
23:37
foundation of financial strength that you never knew possible and
23:41
a level of financial freedom that allows you to have full
23:44
control over your assets and be completely in control of your
23:49
future. I would start with spot Bitcoin
23:52
holding it for eight years. Once you've got a base that is
23:55
untouchable and you're completely unbreakable from the
23:57
financial point of view, then I would go out the risk curve and
24:01
look at something like strategy. Only once you're completely set
24:05
up and and impenetrable would I look at, look at, look at the
24:11
other things. But the only caveat to that is
24:14
if you have capital that's stuck in a system that doesn't allow
24:16
you to buy Bitcoin, then sure, the second best alternative
24:20
turns out there is a second best, and that is owning owning
24:23
strategy shares. OK.
24:25
And if the treasury companies are out performing Bitcoin, why
24:35
would you advise your clients to buy spot?
24:38
Great question. Because there is inherent risk
24:42
with owning those treasury companies.
24:45
Yes, they're regulated, but there is counterparty risk,
24:48
there's regulatory risk, management risk.
24:50
You don't know if you're going to have a 61-O2 attack where the
24:54
government just says, hey, we really love this, we really love
24:57
this Bitcoin. We're going to assume the
25:01
company and we'll give you basically cash for, for the
25:04
Bitcoin that you're holding. All of a sudden you don't have
25:07
it. The problem I see is you want to
25:10
be financially independent first.
25:12
Once we get that foundation, once you get that base, then you
25:15
can go out the risk curve with anything else.
25:17
But until you get your financial house in order, pursuing
25:20
anything else looks to me to be an outsized risk because there
25:24
is there is additional risk to purchasing these treasury
25:28
companies as opposed to just owning Bitcoin.
25:31
Gotcha. So it's more so about the the
25:37
with spot, you're not going to get rugged.
25:39
And with the treasury companies, there is risk because there's
25:44
government seizure risk, there's operational risks, there's
25:47
company risks. So it's like focus on your spot
25:51
stack. And then if you want to take, if
25:54
you take, if you want to take on additional risk, that's where
25:58
the treasury companies come into play.
25:59
That's what you're saying. Yeah, absolutely.
26:02
And I look at this and I think, yeah, get the simple things done
26:05
properly. And then once you've secured
26:07
that, then you can have a look at it.
26:08
And I'll, I'll just sort of, yeah, look at and discuss very
26:13
briefly, you know, the risks that are inherent with the
26:15
treasury companies. You know, two months ago, three
26:17
months ago, the treasury companies were flying.
26:19
Oh my goodness, look at the outperformance relative to
26:21
Bitcoin. Unless you really understand the
26:24
mechanics of the treasury companies.
26:25
And this is something I find intellectually fascinating from
26:29
a financial perspective because we've never seen this.
26:31
And being a Bitcoiner, it gives us a great insight into how
26:34
these treasury companies are trading and how they're may
26:36
outperform. But you know, I look at this and
26:39
if you bought a treasury company two months ago, what you've seen
26:42
with the MNAV compression, which is basically market cap over net
26:46
asset value, has seen a total crushing of your equity in that
26:50
stock somewhere between 25 to 75%.
26:54
You've seen your, your, your, your capital just evaporated.
26:57
And all that comes down to is because, you know, you purchased
27:01
at a really high MNAV and you've seen a 75% compression of that
27:05
MNAV. Now, the flip side to that is,
27:07
is that there's opportunity if the M Nav's low and it expands
27:10
dramatically to outperform Bitcoin.
27:12
But you just need to understand the risks on the markets you're
27:15
entering. Yeah, yeah.
27:18
And let's talk about the, the M NAV because this is something
27:21
that Peter as a Bitcoiner has been as, as a humble Bitcoiner
27:26
who takes a stack stats, stays humble, stays solvent, puts that
27:30
Bitcoin into self custody. All of a sudden, one year on
27:34
Bitcoin Twitter, you just kept hearing M NAV, M NAV, M NAV, M
27:37
NAV, right? And you know, of course, I have
27:40
to cover the news everyday. So I have to educate myself on
27:43
what M NAV even meant. And but now you're seeing this
27:47
compression of it. And I, I'm sure you caught this,
27:51
Peter, where Sailor kind of changed the terms a little bit,
27:56
right? And the MicroStrategy M NAV
27:58
compressed to 1.5. What does that mean?
28:03
Oh, and then not to mention that there are some companies that
28:06
their M NAV is actually below 1, meaning it doesn't even make
28:11
sense because the whole point of, of owning A treasury company
28:13
is because you think you're going to outperform Bitcoin.
28:16
But if it's below one, you're not by definition, you're not
28:19
outperforming Bitcoin. So what's your, what's your
28:22
opinion on that? Because the way from where I see
28:25
it, Peter, and again, I'm, I'm, I, I lack the experience that
28:29
you do in traditional markets, but I was around for the
28:35
20/16/2017 era and I was around for the 2021 era.
28:41
And I do remember that every single cycle there is the thing
28:45
that outperforms Bitcoin, right? So the 2017, it was the Icos,
28:49
the 2021, it was the layer 1 altcoins and the 2025.
28:54
I said this at one of the conference.
28:56
I just, I said, isn't it? They got boos in the crowd and
28:58
whatever, but I'm sticking to it.
28:59
It seems like the IC OS of this cycle are the Bitcoin treasury
29:03
companies. Now, does that mean I'm talking
29:05
about strategy? No.
29:07
Does that mean I'm talking about 21?
29:08
No. Does that mean I'm talking about
29:10
Nakamoto? No, I don't think any of those
29:12
guys are going to go anywhere because of the backing that they
29:14
have. Like SoftBank is a SoftBank and
29:17
Tether, they're not going anywhere, right?
29:19
But the smaller ones, right, there's ones that take more
29:22
leverage, they cut more corners in order to even get close to
29:26
the big guys. I think that we have a downturn
29:31
of 40 and 40 to 50% and you might see a domino effect of a
29:36
lot of these companies start to unravel.
29:40
You know, so like I said, I, I don't have experience in the
29:42
financial markets, but I've been in Bitcoin for almost a decade
29:46
now and I've seen this story before.
29:49
It looks very, very familiar, Peter.
29:53
Looks like a duck, walks like a duck.
29:54
It's probably a duck. Exactly.
29:56
Yeah, it it feels a lot like that.
29:59
And the, the only hesitation I have and nuance I'd like to add
30:06
to that is that we have a buyer of last resort in the very
30:10
strong treasury companies. So I think when you see huge
30:13
appreciation in values, when you see outstanding performance in
30:17
stocks, you're going to get the copycat effect.
30:19
And you're going to see a whole lot of people enter the market
30:21
without the relative experience or training or guidance or
30:26
ethics and values that led to the success of the of their
30:29
predecessors. So I think it's inevitable that
30:32
we're going to have a whole host of these companies fall on their
30:34
face. But why?
30:36
I think this is a little bit different to the previous cycles
30:39
where it's been say Bitcoin miners, Icos, defy main stocks,
30:45
whatever you want twofold on this.
30:48
Firstly, the underlying asset that they're purchasing is
30:50
Bitcoin. And secondly, there's there's a
30:53
perpetual bid from the strong companies in the space that if
30:57
those poorer, poorer managed company ever fall below A1 MNAV,
31:02
there's a buyer of last resort. Think about this sailor can pick
31:06
up these companies for, you know, a huge discount on what
31:10
he'd have to pay on spot market Bitcoin if if they ever get into
31:13
trouble. So I look at this and I think as
31:17
as stupid as people will be in chasing these returns elsewhere,
31:22
there will be a perpetual bid on it.
31:24
So they won't get too hurt because they're the underlying
31:27
asset that they're buying is Bitcoin.
31:29
So I think it's very different to the previous cycles that
31:32
we've seen. I actually think it represents a
31:34
huge opportunity for the best treasury companies in the space
31:38
to pick up discounted Bitcoin well below fair market value.
31:42
And we're going to see those opportunities come up.
31:47
So you are. That's very interesting.
31:49
So you think, wow, OK, so you think that if a, if a, but even
31:54
the smaller ones, even the smaller Bitcoin treasury
31:57
companies, you think that if they go below A1M NAV, you think
32:00
that's a that's a good opportunity?
32:04
I, I think it's absolutely a huge opportunity depending on
32:07
how quickly that they're accumulating Bitcoin and whether
32:10
or not they can keep it. Obviously want want them to be
32:13
operating in an ethical manner. One thing that I think's really
32:16
blown been blown out of proportion in this space is the
32:23
fear that bitcoiners have had paying for a really high M net.
32:28
And what's very difficult to understand about this and this
32:30
is putting a trade fire lens on, you know, absolute digital
32:35
scarcity network asset of Bitcoin is that this M NAV you
32:39
know you've got people who are paying say two to five times
32:44
asset value for a purchase of a share.
32:47
So what that effectively means if, if you want one Bitcoin
32:50
exposure in some of these companies, you're going to have
32:52
to put in somewhere between 2:00 to 5:00 Bitcoin to get one
32:56
Bitcoin exposure. Now if if the market stays still
33:00
and they never accumulate another Bitcoin, that is the
33:03
worst deal in history. You've effectively lost
33:06
somewhere between 30 to 80% of your Bitcoin by doing that one
33:10
trade. What I think gets lost in this
33:14
is the best companies in this space are recruiting Bitcoin per
33:17
share so quickly that that M NAV that you paid gets eroded very
33:22
quickly. And so the thing I look at in a
33:25
setting, the viability of this moving forwards is what's the M
33:31
NAV that you're currently paying and how quickly on a risk
33:35
adjusted basis can they increase their Bitcoin per share to get
33:39
your adjusted M NAV down to 1? So if you pay 2 * M NAV, how
33:46
quickly are they doubling the Bitcoin per share to get your
33:49
adjusted MNAV down to 1? Because once it gets to 1, any
33:54
Bitcoin they add per share is now accretive to you as a
33:58
Bitcoin. Now let me give you an example.
34:00
If you've got 10 Bitcoin and you buy 10 bitcoins worth of
34:03
metaplanet stock today and you're paying a two times MNAV,
34:07
you've effectively halved your Bitcoin.
34:10
Now that's a huge disadvantage. Why would anyone do that?
34:13
Well, let's see what they can do with that Bitcoin per share over
34:16
the next, call it two years. They're expecting to increase
34:20
their total Bitcoin treasuries by 10X in the next two years and
34:25
they're only going to have to dilute that by 40 to 50%.
34:30
So you're getting a 5X return in Bitcoin per share and it's
34:35
costing you 2 times per share. So effectively, by my maths
34:38
simple in my head, I'm looking at that and thinking, well, if
34:42
you're willing to take that risk and you've got money or Bitcoin,
34:46
you're you're willing to burn and lose forever.
34:48
If you take that risk, there's an opportunity that you can 2X
34:52
the investment that you made in Bitcoin tips.
34:55
And this is where all of the investments that I look at now
34:58
have a hurdle rate of Bitcoin. So you need to outperform
35:01
Bitcoin in order to justify any investment, of course, but
35:05
therein lies the the potential opportunity of the Bitcoin
35:09
treasury companies. That having said that, a lot of
35:12
people are going to get burned on this.
35:13
And This is why I just say the greatest message in Bitcoin is
35:16
just stay humble stacks ads, go buy Bitcoin self custody and you
35:21
know, let the future take care of itself.
35:23
Absolutely, I think that's the core message and I keep trying
35:26
to, I say it every single day, just, you know, just take
35:29
Bitcoin to self custody, even even with just spot Bitcoin,
35:34
right, you're laying out 100X in 10 years, 10X in five years,
35:40
which by the way, I completely agree with the with those with
35:43
those predictions. And I mean, what other asset in
35:49
the effing planet is going to give you that type of
35:53
opportunity that 100 X is, is life changing for most people.
35:57
And I think, I think just, you know, it's it's people just have
36:03
an experience. This is they don't understand,
36:05
like it's incomprehensible, right.
36:09
But yeah, I, I, I agree, especially with again, the
36:12
regulatory clarity that's happened the instant, the amount
36:15
of institutional interest. And you said something very
36:18
interesting in the beginning of, of the podcast, Peter, which is
36:23
this is the first time all the stars and planets are aligning
36:27
for something that is absolutely scarce.
36:30
That has never happened in world history.
36:34
Gold is scarce, but it does have an inflation rate.
36:36
The production of gold increases if the price of big price of
36:40
gold goes up. The production of Bitcoin does
36:43
not increase if the price of Bitcoin goes up.
36:46
Actually it gets cut in half every four years no matter what.
36:51
So yes, I I completely agree with you that that shock I think
36:56
is going to hit the world by storm.
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today. Now I want to go back to
38:12
something that you were talking about earlier, which is this
38:16
Michael Saylor's talking about this 10 year rush to acquire as
38:20
much Bitcoin as possible and then the S curve happens.
38:25
So what happens in 10 years, like is that when we see the,
38:30
the madness happen, the scramble, when everyone starts
38:33
to realize, Oh my God, like I, we actually do need this Bitcoin
38:37
in order to function. Is that when you start to see
38:39
the likes of Microsoft, Google, Meta say, hey guys, we're just
38:45
not competitive unless we put a portion of of of our cash or
38:52
cash equivalents into Bitcoin or perhaps even start acquiring
38:57
Bitcoin to remain competitive? I think we're going to see all
39:02
that and more. If you look at what what's
39:05
happening in those markets, I think it's inevitable that every
39:08
company will start stacking Bitcoin.
39:10
I think we're going to see Bitcoin backed bonds, which is
39:14
going to recapitalize the entire financial world.
39:18
Then I also think we're going to have payments in Bitcoin spread
39:22
to the commodities market, the oil and gas market.
39:25
You look at there's 100 million barrels of oil a day that get
39:29
traded. You've got the imposition of
39:32
tariffs across a whole host of countries that are rich oil
39:35
producers. Russia produces 10% of the
39:39
global oil and they're on a whole list of tariffs enforced
39:43
by the US if they want a, if they want to take payment for
39:46
their, for their oil globally. There's only one system on earth
39:50
that the US can't control and that's Bitcoin.
39:54
And I look at that and think, you know, there's somewhere,
39:57
somewhere between 500 to a billion dollars.
40:00
Per day of global demand in just that one use case.
40:03
And then you look at the, you know, you look at the bond
40:05
market, if we're looking at creating, you know, principal
40:08
protected notes which are going to recapitalize our banking
40:13
system and our financial markets, there's roughly 60 to
40:16
$70 trillion worth of bonds that are refinanced on a global
40:19
basis. If you paid that with say a 20%
40:23
weighting to Bitcoin, that would be a bid of roughly $14 trillion
40:28
a year on Bitcoin. And I look at that and think,
40:31
well, there's $14 trillion that the government can print out a
40:34
thin air to stuff into Bitcoin. What would that do?
40:37
You know, that's seven times the market cap of Bitcoin to that.
40:41
What does that do when that seven times the market cap is
40:44
trying to get 2 million Bitcoin that's left on exchange?
40:48
Obviously that's going to send that exponential.
40:49
But what you've got, you know, fuel on the fire for this is the
40:53
fact that there's credit markets that are being built out at the
40:55
same time, Bitcoin, whether it's commonly known amongst
40:59
traditional financial markets will be seen as pristine
41:01
collateral because that can take as much capital as possible.
41:04
That allows Wall Street to speculate.
41:06
There's no no downstream consequence to Main Street.
41:09
And all of a sudden that's the vehicle that everyone wants to
41:13
to basically trade. All of a sudden, there's none of
41:15
it available. So this is where we see that
41:17
inflection ES curve. And I look at this and think
41:20
this is just inevitable. And and to pile on one other,
41:24
one other considerable factor which we're nowhere near yet is
41:28
that Bitcoin is a need for 8 billion people, but maybe only
41:32
10 million people feel like that at the moment.
41:36
Wow. Could you say, can you repeat
41:37
that line again? Because that was fantastic.
41:42
There are 8. Billion people in the world and
41:45
there are only 10 million people who understand that Bitcoin is a
41:48
need. So 8 billion people need this.
41:51
Only 10, only 10 million people understand that to be true.
41:55
I love that I love that I love that line.
41:58
So Peter, I think one of the questions that, you know, is
42:02
very popular in in my neck of the woods and and just media and
42:05
and just, you know, Bitcoin, I I can't call it Bitcoin XI don't
42:10
know about you, but it just sounds weird.
42:12
Bitcoin Twitter. I'm I'm a dinosaur too.
42:15
Just Bitcoin Twitter, just it's a Bitcoin X like it sounds.
42:18
I don't know I love you one, but yeah, Bitcoin Twitter, Bitcoin
42:22
Twitter slash X1 of the one of the main things and I'm Peter,
42:28
I'm sure you've seen this right, which is this whole concept of
42:31
like, wow, like this is fantastic.
42:33
There's so much potential in this asset.
42:35
The best is yet to come. And I think the question on a
42:39
lot, a lot of people's minds are, is like Peter and Nico, I
42:44
hear you guys, I hear you guys. I, I completely agree with you
42:47
guys. You guys are right.
42:48
But like, man, I, I just, I don't have $111,000 of
42:53
disposable income. Like how can I even get to 1?
42:56
Like, you know, like how can I get to 1 Bitcoin?
42:59
So my question to you is for the average family, and of course
43:03
this is very dependent on where you live and what your lifestyle
43:06
is and etcetera, etcetera. Like for the average family, you
43:11
know, let's say for the average family in pick a continent,
43:17
Peter, pick a, pick a place, pick a place.
43:20
I'll leave it up to. You Why don't we pick Europe?
43:22
There we go friend. Why don't we pick Europe, an
43:24
average, an average family in Europe, right?
43:28
How much Bitcoin do they need? And like if they started
43:32
stocking today, right, they, you know, they didn't, they didn't
43:35
see it in 20. You know, they didn't see it
43:37
back in the day. They just, they ran into Bitcoin
43:40
today in 2025. How much Bitcoin could they even
43:44
get to to a point where it would start benefiting their lives?
43:52
Any amount of Bitcoin will benefit their lives, and so I
43:55
think it's all relative. It's about taking a risk on an
43:59
asset that we believe to be the best asset ever invented that is
44:04
going to have life changing benefits, both financially and
44:08
non financial benefits. So I, I would say start with
44:10
whatever you can. If one thing we look at as the
44:15
Bitcoin advisories, what are the pools of capital that clients
44:19
can allocate to this? Now in most continents on earth,
44:22
we have a working pension system.
44:24
So in all the Western democracies, there's a pension
44:27
systems you can potentially buy and hold direct Bitcoin or spot
44:31
Bitcoin. If you can't do that, there's
44:34
typically a Bitcoin proxy that you can look at, whether it's a
44:37
Bitcoin ETF or alternatively a Bitcoin treasury company.
44:42
I would look at typically in, you know, across the countries
44:46
that we're familiar with, the largest pool of capital that's
44:48
not going to affect household income and spending is their
44:52
pension. So that would be the first place
44:54
that I would look for a significant amount of capital.
44:57
And I'll just tell you this conversation I had with a client
45:00
yesterday, he called me, he's just gotten into Bitcoin.
45:04
He's reading Saffordanes, you know, he's just finished reading
45:07
the Bitcoin standards. He is all about Bitcoin.
45:11
He's going to buy $1000 worth of Bitcoin.
45:13
I referred him to a local exchange to look after and he
45:17
started to buy and he said, oh, I really want to build this up.
45:20
I think I can get $10,000. I said, that's wonderful.
45:24
Do you have, I'm in New Zealand at the moment.
45:26
I said, do you have a Kiwi Saver, which is the the local
45:29
pension system? He said, yeah, I do.
45:31
And I said, do you, you know, how much money have you got in
45:33
there? He said, I've got $150,000.
45:36
I said, well, why don't you use that to go and buy Bitcoin or
45:40
Bitcoin exposure? He said, oh, I hadn't thought of
45:42
that. Is that possible?
45:43
I said absolutely. That is, here's a contact,
45:46
here's an advisor who will basically refer you into, you
45:49
know, that product to help you buy Bitcoin.
45:51
Now in New Zealand, you can't buy spot Bitcoin in your pension
45:54
system, but in a lot of countries you can't.
45:56
But you can get the the a a proxy exposure to Bitcoin via a
46:00
Bitcoin treasury company or an ETF.
46:02
So I look at this and think in two fold.
46:07
People are motivated to learn about Bitcoin when they have
46:09
skin in the game. To me, that pension system looks
46:12
like an ideal way to do that because most people can't touch
46:15
it until the age of 65 because Bitcoin is so volatile.
46:19
You solve the volatility of Bitcoin by just the duration
46:22
that you hold it. And given that most, most
46:24
pension systems in the globe don't allow you to access it to
46:27
65, that allows time to take care of the volatility for you.
46:31
And this is where I think that is probably the first place I
46:36
look to and have a conversation with clients about.
46:39
That is a large pool of capital. It's not going to have an effect
46:43
on their household cash flows. And that's really critical
46:45
because people don't want to take a risk with their household
46:48
cash flows because let's face it, times, times are pretty
46:51
tough right now. I know there's a lot of
46:53
positivity in the world on the rest of it, but there's a whole
46:55
host of families that are struggling.
46:57
And that mentality of needing Bitcoin, not wanting it, I can
47:02
tell you that most of our clients come to Bitcoin with a
47:04
need, not a want. And this is where if you need
47:07
it, you don't really have spare capital or cash lying around to
47:10
risk it. And a lot of people when they
47:12
first get to Bitcoin think it's a risk.
47:14
So I look at the pension system as a way to get exposure to
47:17
Bitcoin, to get them eased into it, get them educated in it.
47:21
Because once they invest in it, they're going to start spending
47:23
a lot of time on it and understand it.
47:25
And once they understand it, then they're going to transport
47:27
that knowledge into the traditional, you know, into
47:30
their household finances from the pension system.
47:33
So I look at that as a really a great way for for someone to
47:36
learn and educate themselves on it in a manner that is a
47:40
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47:43
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48:36
Yeah. So Peter and let's talk about
48:38
that, right. The you said in a way that's
48:44
relatively safe and I think me and you both really emphasize
48:51
the idea of spot Bitcoin in self custody.
48:55
And I think me and you both have come to very similar
48:59
realization. Me, I don't do this for a
49:03
living. I'd, I'd focus more so on media
49:05
and content creation, but you do this with Bitcoin advisory.
49:08
And I want to talk about that is what I've learned over the last
49:11
decade or almost a decade in Bitcoin is I am still the Uncle
49:15
Jim for my entire family and extended family.
49:18
I've taught, I've tried to teach them everything they need to
49:21
know about self custody and every wallet and etcetera,
49:25
etcetera. But no matter what, I still get
49:29
a phone call every two weeks freaking out about the seed or
49:34
whatever. And what ends up happening is I
49:37
just end up, you know, basically just like, you know, being the
49:43
Uncle Jim being tech support for, you know, everyone with
49:47
everyone that you know, my close family that you know, that that
49:51
needs help with Bitcoin, right? And I think this is where
49:54
Bitcoin advisor comes in, because not everyone has an eco
49:58
that they can call, but they can call a Peter a Bitcoin advisor.
50:04
And this is what you guys do. You guys help, you know, people
50:09
protect their Bitcoin in their own self custody.
50:13
And I think that's extremely important because I think I had
50:17
this like very idealistic vision of of Bitcoin initially.
50:22
I was like, dude, like, if you can make a sandwich, you could
50:25
take self custody. You know, if you know, if you
50:27
could drive a car, you could take self custody.
50:29
Like it's so easy. But what I've come to realize is
50:34
that human beings are creatures of comfort.
50:36
And if there's no necessity, I'm just, I'm sorry, my grandma is
50:43
just not going to do it. Like I know she has the capacity
50:46
or she, she had the capability of doing it, but you know, it's
50:50
a lot easier. It's a lot easier to just call
50:53
Nico, right? So this is where Bitcoin advisor
50:57
comes in because you guys provide that infrastructure
51:01
while also giving your clients the the sovereignty.
51:07
I think that's the appropriate word of them, you know, being
51:10
able to control at least part of their keys, but also it has this
51:16
kind of like this backstop protection.
51:22
So in case they lose, lose their seed phrase, they know they can
51:27
call you guys. And I'm sure you guys have a
51:29
bunch of security features to authenticate that it's the right
51:32
person who's making the call, etcetera, etcetera, etcetera.
51:35
So can you talk a little bit about the importance of self
51:39
custody, the importance of custody of custody in your
51:42
coins, and what you guys offer at the Bitcoin Advisor?
51:48
Taking the Covey I I think we're every Bitcoiner is on the same
51:52
page that we want everyone in the world to self custody
51:56
Bitcoin and be self sovereign. And unfortunately, not everyone
52:01
has the desire to do that, but we all understand that that's
52:05
the best place for someone to be when it comes to self custody
52:08
Bitcoin, provided that there is risk mitigation around that
52:11
person losing it. And this is where in my workout
52:16
on this over the last 10 years, we've had a whole host of
52:18
clients who are baby boomers who are potentially not really that
52:23
tech savvy or alternatively, at an age where mental capacity to
52:28
actually self casting Bitcoin is a genuine concern.
52:33
And we built a system around collaborative security that
52:36
ensures clients can can self casting their Bitcoin.
52:39
But most importantly, they're not going to have a single point
52:41
of failure where they wake up one day and they've lost their
52:43
Bitcoin. And to me, you know that all the
52:46
hard work you do and I do and talk about people getting into
52:50
Bitcoin stacks that stay humble, all of that's for naughty.
52:54
If you don't secure your Bitcoin properly, if you leave it on an
52:57
exchange that blows up like FTX, you've lost a Bitcoin.
53:00
If you don't self custody of Bitcoin properly and you lose
53:03
it, then it's all for naughty. And this is where the hard work
53:06
we put in upfront to educate clients on why this is important
53:10
is supported with a collaborative security model
53:13
that gives every client that we work with the Peace of Mind to
53:16
know that however much capital they want to allocate to
53:20
Bitcoin, they can be assured that there's nothing that can go
53:23
wrong with it. We've never lost a Satoshi.
53:25
We've never had. We've never lost a Bitcoin.
53:28
And that to me is probably the most important thing that we can
53:30
deliver is that Peace of Mind to a new Bitcoiner who wants to
53:34
allocate in large amounts but is scared to do it, doing all the
53:38
self casue themselves. We have a process and a system
53:41
that has not been compromised once that allows you to put a
53:46
whole chunk of capital to work without any fear of loss.
53:49
And to me, that's, that's probably the most important
53:51
thing we deliver is Peace of Mind to know that if something
53:54
happens to you, you're going to be able to recover your Bitcoin.
53:57
And sad, sad to say, but proud at the same time.
54:01
We've had a number of clients pass away and I'm going through
54:05
one of that, one of those at the moment.
54:07
And it was a very dear friend and client who I love, but we're
54:12
just working through with their family at the moment to move
54:14
that to the beneficiaries. And even though he's gone and
54:18
he's self casting his Bitcoin, the family will all benefit from
54:22
him and his holding in Bitcoin. And I, and I think that's in,
54:26
in, I'm sorry to hear that, Peter.
54:28
And I think that's, that's incredibly important because,
54:31
you know, that's the thing. That's one of the things that
54:35
there's trade-offs with self custody, right?
54:37
It's not this, you know, it's you go from being non sovereign
54:44
to sovereign. But by being sovereign, I'm
54:48
going to be, you know, I'm a dad now, so I can make bad dad
54:51
jokes. You know that spider man quote,
54:54
right? With great power comes great
54:57
responsibility, right? But also, you know, if you and,
55:03
and again, this is unexpected, right?
55:04
And no one knows what's going to happen tomorrow.
55:08
You know, you pass away and you're the only one that has
55:13
access to that Bitcoin. You know, that's basically, it's
55:19
basically gone forever, right? Your, your family's not going to
55:21
be able to access that. And I think that's where, you
55:25
know, that's where you guys provide a tremendous service
55:28
where you, you, you provide that, that, that security and
55:33
that Peace of Mind. Now, Peter, question to you is
55:38
how do you, and of course, like, I don't want you to reveal the,
55:41
the, the secret internals or anything like that, but how do
55:45
you verify that, you know, how, how, how can people be ensured
55:52
that that Bitcoin isn't going to move without their express
55:57
permission or if something were to happen to them?
56:02
Great question. There's a number of different
56:04
measures that we put in place. We leverage off our technology
56:07
providers to start with. So there's username, password, 2
56:11
factor authentication, video verification to confirm that
56:14
that's all good. There's a second layer of
56:17
protection for clients that we've got a spending protocol
56:21
and then in order to sign a transaction in the event that
56:25
clients passed away, there are a number of legal documents that
56:29
require and I'll just go through those quickly.
56:32
You need a, a notarized death certificate, You need a
56:34
notarized last will and testament, a a notarized ID of
56:39
the executor of that estate, so the person managing it and then
56:42
a notarized ID of the beneficiaries who are set to
56:46
claim that Bitcoin. Once all of that's been through
56:50
legal process on our end we and we've confirmed that the client
56:53
is no longer with us, then we're in a position to cosign a
56:56
transaction and move that across.
56:58
And part of the part of the process that I go through that
57:02
the clients agree to is the the probate process on death can be
57:07
very time consuming and it can take extended periods of time
57:11
depending on where you are in the world.
57:13
Typically that's a process of somewhere between one to three
57:15
years that you've got to administer a state and
57:18
distribute to the beneficiaries. So written into our contracts to
57:23
ensure that there's no forward on on the basis of speed having
57:27
to get this done quickly. There is an agreement with
57:30
clients that in the event of death and there's U to a two
57:34
year period that we've got to ensure that everything is in
57:37
that we've confirmed all the details and then we have the
57:40
ability to cosign that over a two year period.
57:43
Obviously that can be a lot quicker if we do the work and
57:46
confirm the death quicker. But in the event that that's not
57:49
the case and we're having trouble doing it, we can extend
57:52
that period of time. Because the last thing we want
57:53
is a client going on a trek through the Amazon for six
57:56
months and then coming back and and his family's basically asked
58:00
us to cosign a transaction that distributes that to to the
58:03
beneficiary. So we've got up to A2 year
58:06
period to do that, not that we've had to do that.
58:09
We've got great relationships with our clients and and and
58:12
their family members as well. So we we've had an impeccable
58:16
record today with all of that. And Peter and final question,
58:21
which is what is the, so I'm assuming it's a two of three and
58:27
my pretty, I guess simple question, which is how can
58:33
people trust the Bitcoin advisor to not spends that Bitcoin
58:39
without authorization? So I'm assuming the client owns
58:43
or holds one set of keys, Bitcoin advisor holds another
58:47
set of keys and then a third party holds another set of keys.
58:53
So how does a client that again, it's not necessarily
58:59
comfortable, totally comfortable with, you know, complete self
59:04
custody, single one sig, you know, self custody on a you
59:08
know, on a cold card or jade or, you know, big key.
59:14
But you know, they they again, they they they want the benefits
59:17
of custody. They want to be able to see
59:19
their Bitcoin, but simultaneously they want that
59:24
assurance that, hey, you know, what if Peter, you know, teams
59:29
up with that third party and they just rug for me.
59:34
It's a great question and this is where I can tell you behind
59:37
the scenes, I'm pushing really hard on some of the updates to
59:40
the multi seek that I think will alleviate any of those concerns.
59:44
And let me just talk to that briefly before answer your
59:46
point, but the development with Taproot and Miniscript I think
59:50
represents a huge change in creating programmable multi
59:54
seeks. And this is one thing that I'm
59:56
pushing for because in light of all the bullshit that we've been
59:59
through over the last five years with our institutions and the
1:00:02
degradation of trust across all of them, the the point you're
1:00:06
making I think is perfectly valid.
1:00:07
And I would echo that point in that unless it's
1:00:11
cryptographically verifiable, I don't trust you.
1:00:14
So what happens in this point when we get to that?
1:00:17
Well, the programmable multi seek is something that I'm
1:00:21
advocating for because that will remove in concern that you've
1:00:25
got about trusting any of the third parties.
1:00:27
Because in a programmable multi seek, you can program that multi
1:00:32
seek to have the client as the master key.
1:00:35
And unless that client signs a transaction, the cosigners
1:00:40
cannot sign a transaction. So I look at that and think
1:00:43
that's going to be cryptographic proof that there is no, no
1:00:47
malfeasance possible. And so that to me is where we're
1:00:50
going to get to. That's in the works, that's out
1:00:52
there at the moment, but it just takes time to filter through to
1:00:55
retail. I can assure you that's what I
1:00:57
want to see come in because that's how my bit con secured.
1:01:00
But in the meantime, until that actually gets filtered through
1:01:03
to the retail offerings, I can tell you that we can't cosign A
1:01:07
transaction unless it's authorized by the client on
1:01:11
their platform. So we've got no recourse to do
1:01:13
that. So up until such time as we do,
1:01:18
I can tell you it's impossible. And you can take that at face
1:01:22
value or not. But I can assure you that I'm
1:01:24
working really hard on integrating this programmable
1:01:27
multi seek to clients so that you don't have to trust me and I
1:01:30
don't want you to trust me. I want to make it
1:01:32
cryptographically verifiable that there's no collusion can
1:01:35
take place. Yeah, and, and I want to talk
1:01:38
more about that, right, because now you have the time locks,
1:01:42
right, which I think is going to work so amazing, right, where,
1:01:47
you know, specific keys aren't going to be able to sign
1:01:51
anything unless a specific amount of time has passed,
1:01:55
right. So there's so many different
1:01:57
types of ways that you can use, you know, the, the, the, the new
1:02:02
scripts with Taproot for your benefit.
1:02:04
And it's extremely exciting. And I agree with you.
1:02:07
And it's so interesting to see many kind of open source
1:02:11
developers tackling that, you know, and, and using these new
1:02:15
properties of Bitcoin to their benefit.
1:02:18
So yeah, I'm, I'm extremely excited, excited about that.
1:02:21
And I think it solves A tremendous amount of problem
1:02:24
problems without, again, giving up without, because there's no
1:02:27
trust required in that situation, right?
1:02:30
Because you know that you're, you're guaranteed that at least
1:02:33
for a year or two years, that key that that third party has
1:02:37
can't be used to sign on that specific transaction.
1:02:40
But if you lose your key because you were, you know, on a boat in
1:02:44
the middle of Amazon, like, dude, you're going to have to
1:02:46
wait two years. But again, you know, it, it
1:02:48
comes to trade-offs, it comes to pros and cons.
1:02:51
Peter, thank you so much for joining me today, guys.
1:02:53
Go to thebitcoinadvisor.com if you want to find out more about
1:02:58
the Bitcoin Advisor, collaborative security for
1:03:02
Bitcoin. And Peter, it's always an honor
1:03:05
to have you on the show, and you blow my mind every single time.
1:03:07
Thank you so much for joining me.
1:03:10
Thanks Nika, pleasure to be with you.