The BORING Road to $1 Million Bitcoin (No More God Candles)

0:00Hello, everyone. We've got a lot to discuss today. Bitcoin's volatility has been rapidly falling. The most recent iteration of humanoid robot demos, those are going to blow your mind. And Joe Pompliano, my brother, is going to join us to explain the blockbuster acquisition of the NFL Network by ESPN. We're live today from the desk of Anthony Pompliano.

0:28So everyone knows that Bitcoin's volatility has long been a major selling point for investors to purchase and hold the asset. Retail investors saw that volatility as a way to buy Bitcoin early, hold it, and then it would go up a lot. Sophisticated institutional investors, they saw the volatility as an asymmetric bet that presented the best risk reward scenario in finance. So what happens if the volatility starts to disappear? That wouldn't be good, right? Well, we don't have to guess anymore because this is starting to happen over the last two years. Bloomberg's Eric Balchunas writes that it's a vol killer.

0:58Since the launch of the ETFs, the volatility on Bitcoin has plummeted. The 90-day rolling vol is below 40 for the first time. It was over 60 when the ETFs launched. He also concludes that GLD, it used to be that Bitcoin was over 3x GLD's volatility. Now it's only 2x. Mitchell Askew concludes that this decreasing volatility means that Bitcoin looks like two entirely different assets before the ETF and after the ETF. The days of parabolic bull markets and then devastating bear markets. Those are over, he says. Bitcoin's going to a million dollars over the next 10 years through a constant oscillation between pump and consolidate.

1:35Pump and consolidate. It'll bore everyone to death along the way and it's going to shake the tourists out of their positions. Mitchell says to strap in and get ready. Now, Bouchounis agrees with Mitchell. Eric writes that this guy gets it. We've been saying the same thing. Since BlackRock filing Bitcoin, it's up 250 % with much less volatility and no vomit-inducing drawdowns. This has helped it attract bigger fish and gives it a fighting chance to be adopted as a currency. Downside is probably no more God candles, so you can't have it all. But some of the scientific's Joe Burnett sees it a little bit differently.

2:09Joe says that before Bitcoin's 2017 pair ball at bull run, volatility had been steadily declining while the price was slowly ticking higher. Over the last three years, we've seen similar behavior. Volatility has continued following while Bitcoin gradually climbs. Now it feels like we're at another inflection point. Does volatility keep falling from here? If so, then maybe Bitcoin continues its slow and steady grind upward. But if we're still early in the adoption cycle, the setup could be explosive, according to Joe. Governments have yet to take meaningful positions. The S &P 500 owns very little Bitcoin and institutions own very little Bitcoin too.

2:43and the typical portfolio still holds 0 % Bitcoin. So if Bitcoin's already a mature asset, maybe the trend continues. But if we're still in the early stages of global adoption, we might be on the edge of a breakout that looks more like the 2017 parabolic bull run, which has upward volatility. So what's going to happen? Short answer is that no one knows. I wouldn't bet on Bitcoin staying dormant forever. The asset's known to become volatile right when everyone thinks it won't. But I also believe Bitcoin's long-term volatility will continue to compress as the asset gets larger, more traditional finance investors hold it, and the asset transitions from a contrarian trade to consensus trade.

3:21Volatility is important. It brings greed and fear. It provides opportunity to investors, and it ultimately serves as an incredible marketing campaign for Bitcoin. Let's hope the volatility is not gone. It would be incredible if the market gods blessed us with just a few more years of max volatility. Now, I don't think it's any secret. I cannot wait for humanoid robots. Get them in my house, get them in my office, get them in my life so that they start doing things that I don't want to do. In the most recent video coming out of One X, they show a robot delivering bedside snacks and electrolytes to somebody who's hungover.

3:55Take a look at this video.

4:02Oh my gosh, thank you, Neo. You are the best.

4:12Bro. Now, you can't tell me that if you were laying in bed, didn't feel so well, and you could just push a button or yell out, and a robot brought you food and drink, that'd be pretty damn cool to me. But see, these robots, they're not just going to do simple tasks like that. They also are going to be doing all sorts of things in the real world. And as you know, the real world is a dynamic place. There's things on the ground. You got to go upstairs. You got to walk around a corner. You never know what could be waiting for you any second of the day. And so robots are now becoming available that can actually navigate the real world.

4:45Skilled AI just posted a video that shows the robot in scenes that it's never been in before. It simply puts it out into the world and it says, go do this task. Navigate the world just like a human would. Watch some of the things that this robot can do here.

5:30Now, if you're unconvinced that humanoid robots are coming, they're going to be all over the world, and they're going to be doing things from work to things in your home, and they're going to do it with the same ease and sophistication of a human, now you know. They can bring you food and electrolytes at your bedside. They can go up and down the stairs. They can get pushed. They can get shoved. They can carry things. And ultimately, they're gonna come take some of your jobs and they're gonna make your life better. You can't fight the future. Humanoids are gonna be a big part of it. And I can't wait for that future to come.

6:02All right, ladies and gentlemen, we got a very special treat. Joe Pompliano from Huddle Up is here to explain what's going on over at ESPN and Disney. They made massive acquisitions this past week. ESPN bought NFL Network, Red Zone, and NFL Media Assets, and Disney bought the rights to WWE. These are mega deals in changing the landscape of business and media. So here's my conversation with Joe Pompliano. Joe, so I thought a great place to start the conversation is that ESPN made a massive move. They now are acquiring all of the NFL Media Assets. Explain what's going on here. Yeah, this is a huge deal.

6:35I mean, just the fact that ESPN and NFL are getting into bed together is obviously going to raise some eyebrows. Journalistically, from an editorial perspective, also ESPN owns a sports betting business or part of one. So the NFL is now going to be associated with that too. But look, this is something the NFL has been trying to do for a decade now. And what I mean by that is they've been trying to sell their NFL media assets. They initially launched basically a direct relationship with the fans through NFL Network in 2003. They then added stuff on top of that to increase the value over time. Most notably is Red Zone, the whip around show, but they have NFL films.

7:07They have a fantasy football business. They have NFL Plus, which is a mobile streaming service for games as well. But over time, they realized that this really wasn't a core competency of theirs. The cable business has been extremely challenging. I think they were in over 70 million homes at their peak, and now they're in less than 50 million homes. So this is something they've been trying to offload for a period of time because it's not even just the economic factors that are challenging that business. It's also they own a massive production studio in Los Angeles. They have to negotiate talent, right?

7:34Like there's so many other things that go into it. So they've been looking for a partner to go in on this with. And I think ESPN, if you're them, you probably didn't get everything that you wanted out of this deal. It's probably a little bit better for the NFL, given that they had to pay$2.5 billion in equity value over the NFL for it. But at the end of the day, you are aligning yourself with the NFL long-term, which is incredibly valuable because essentially everything that ESPN relies on going forward is going to be dependent on the success of the NFL. So I don't blame them for doing it. What I find most interesting out of this deal is like, yeah, there's going to be some value out of NFL Red Zone.

8:09There's going to be value out of NFL Network. That's going to help them negotiate with affiliate fees higher and everything else like that. But ultimately, what are the unspoken benefits that come out of this? Right. One of the most interesting things to me is that the way NFL scheduling works, and I don't think most people realize this is in college football specifically, the networks pay money to the conferences. And depending on how much you pay per conference, you go in and you held a literal draft. So if we use the Big Ten as an example, Fox pays the most money. So they sit in a room. They have the top three picks.

8:38They pick Ohio State and Michigan number one overall because that's going to get the most viewership. Then they go down the line basing it on what they think is going to get the best viewership depending on the week. You have to estimate as you get further down the line what teams are going to be good, what days are going to be advantageous from a viewership perspective, and so forth. But it's really methodical, right? You get more picks depending on how much more you pay, and you get to determine which games you get. With the NFL, these broadcasters are buying windows. So they buy Thursday night football for Amazon, Sunday night for NBC, Monday night for ESPN.

9:08But you don't know which matchup you're going to get in that window. The NFL determines that. So one of the things that we've seen over the years is that the NFL is willing to leverage that to be able to give people better matchups depending on what they give the NFL in return. So a good example of this is that Amazon famously complained about their ratings in year one of the Thursday Night Football deal after paying all of that money. So the NFL gave them better matchups in year two. ESPN did the same thing when they increased their rate from$2 billion a year to$2.7 billion a year under the last media rights deal.

9:37They were given a whole host of benefits, but most importantly, they were also given better matchups, which gave them the highest viewership numbers in history for Monday Night Football the last two years. So when you look at this, what is the downside for the NFL to do this? Well, you don't own the media assets anymore, right? You're selling the brand of Red Zone to ESPN, who can now go technically go do this for college football, college basketball, etc. So you're losing some of the assets there. I also thought it was quite interesting that they did this with a linear TV player rather than one of the big streaming technology companies.

10:07And I think the rationale behind that is one that most other companies wouldn't have done this deal because it probably doesn't pencil out in a financial model like you would expect one of those companies to do. but they're also ensuring that ESPN is one of the people bidding on these rights long-term, right? The thought process has always been that the rights are getting so much more expensive because they're a necessity for these cable companies to own. It's the only thing keeping their business alive. So they have to pay up more money for the same rights. The streaming companies have so much money at their disposal that they can afford to pay for this, even if it doesn't make financial sense right now, because it will long-term.

10:40So that's what's been driving prices up long term. But if we end up getting to a point where it doesn't make sense for the ESPNs, the Foxes, the CBSs of the world, et cetera, to continue to pay for these rights, then all of a sudden the NFL has a problem because they lose out on all these bidders. But by keeping ESPN in the fold with this deal, you're guaranteeing that they're going to be there for the next media rights negotiation, which should take place in 2029 if the NFL opts out of their deals like everyone expects. But ultimately longer than that, I mean, over the next 15 to 20 years, you're guaranteeing that the ESPN, that ESPN is going to continue bidding on these rights.

11:11And for me, that's worth it in exchange for giving up some of the short-term value with the NFL media assets that you've spent two decades building. The guy, Scott, who does NFL Red Zone. Scott Hanson, yeah. Scott Hanson. I heard he doesn't take bathroom breaks during the entire day. So like, that's a pretty important talent that we got to keep around because that Red Zone is amazing. You think he's going to stick around? He's got a four-year deal. So don't expect Stephen A. Smith or Kendrick Perkins to be on NFL Red Zone anytime. time soon. But look, that was one of the big worries of people, right?

11:40Like, is ESPN going to mess this up? And I was happy to see that the NFL is actually going to be still running the production on Red Zone for at least the next few years. It's going to be out of their studio. Now, it's been reported that ESPN is taking over the lease on that building, which again, is one of those things that ESPN probably didn't want to do. They have a massive facility in LA already. They have one in Bristol and others as well. So ESPN gave up some things here, but in return, it should ultimately be good for the consumer. And one of the things that we haven't talked about at all here, which I think is a huge part of this deal.

12:08And sort of the headline is that ESPN is doing all of this for their direct consumer app that's going to be launching in about two weeks. Now, everyone is launching a streaming app. ESPN is no different, but essentially they're going to be attacking and trying to get cord nevers and cord cutters to sign up for the service. Now, the problem with this is they don't own all of the sports rights, right? So if you're an NFL fan, you can't just simply sign up for ESPN streaming service and get all of the NFL content. You still have to have Fox, CBS, Amazon, NBC, et cetera. But if you're an SEC football fan, they own all the rights to that.

12:38You could go sign up for their service and get everything you need right there. But ultimately what I'm most excited to see what ESPN is able to do is how do they use all of the rights that they've acquired over the years? I mean, they're spending billions of dollars every single year on these rights to create a one-stop shop for sports fans, right? Like for me and you, it's probably easy to envision a world where they can combine those rights in a streaming service with sports betting, with fantasy, with commerce to sell merchandise, with a, you know, a ability to optimize it to your preferences, right?

13:06Like, I want the service to look like Netflix. When I go log in, I want to see the Giants on there, right? I want to see interviews with the Giants players. I don't care about a sport or a team or a game that I don't actually want to watch. So I want a personalized service that I think ESPN should be able to deliver on. Maybe it takes them some period of time, but I ultimately think that's going to determine if that service is successful or not. That makes sense to me. Now, ESPN and Disney, they're in bed together. And Disney, they also wanted to strike a mega deal. They're buying the rights to WWE.

13:36What's going on with that deal? Yeah. So I think this was another deal that came to fruition because of the streaming service that's going to be launching. I mean, if you think about launching a streaming service, you probably want some content that's exclusive to that service and brings value for people to go sign up and create some sort of urgency. Now, neither of these deals are going to be closed this year. It'll be 2026 when ESPN officially takes over the NFL assets and also WWE's premium live events. But I think this was a good deal for WWE. I mean, they moved it from Peacock to ESPN. They're getting$350 million a year, which is nearly two times more than they were getting on Peacock.

14:11But additionally, they also save a lot of money elsewhere. They had the domestic WWE library, which was on Peacock. ESPN is not going to be getting that so they could potentially go sell that to Netflix to match up with Monday Night Raw. They also had about 250 hours of original programming and five documentaries that they had to do every year for Peacock at their expense, which they will no longer have to do for ESPN. But at the end of the day, ESPN felt comfortable paying that amount of money because we've seen with Netflix on Monday Night Raw that WWE is one of those assets that is going to help with customer acquisition.

14:43It's also going to help reduce churn. So for a streaming service that's now to launch with ESPN. I think this was a smart deal for both ESPN and obviously WWE with the increased fee as well. The other thing I would mention on this, by the way, is that you alluded to a little bit with ESPN and Disney sort of being adjoined at the hip. And I think that these deals could potentially lead to the long-awaited spinoff that people have been assuming on could potentially happen over the last five to 10 years. If you're the NFL, owning 10 % of a standalone ESPN that trades on the market is much more advantageous than owning 10 % of an ESPN that sits with inside Disney, right?

15:18And I think you could pitch this to shareholders as you're essentially separating the two businesses because they aren't alike at all. It's easier to value these assets rather than having them with inside Disney. But then also if you're Disney, you can tell this interesting story about how you're refocusing capital and management around the assets that are higher growing and things like that because of the decline in the cable business. So that's something I would look out for too, because I do think within the next few years here, specifically if Bob Iger was to leave over the coming years, that ESPN could potentially be spun off into its own asset.

15:49So spin it off, focus, streamline, create shareholder value. That sounds like an executive's talk track for decades and decades. The question is, if Bob Iger actually leaves, does the next CEO have to keep looking over their shoulder, whether Bob's going to tap him on the shoulder and say, hey, I'm back again, as he did one time before? They better perform. Otherwise they should be looking over their shoulders. All right. Where can we send people to, to read your stuff on huddle up? I wrote about all these deals this week on a read huddle up.com. So you can go there, sign up, send out three days a week.

16:21All right. So if you want to learn about all of the money and business behind sports, you go to huddle up. A read huddle up.com is where you get it first. Then you get it second on from the desk of Anthony Pompliano. And then you'll read about it third in the mainstream media a couple of days later. So make sure you go check it out. Read huddle up.com. Joe does a great job. I read it. And here's how you know it's good is I actually pay him. He's my younger brother. And if I'm giving him money, he better be giving a lot of value back, which I'm a proud subscriber. I think I was the first subscriber.

16:50Yeah, I was going to say you were one of the first subscribers. I don't know if you know this, but I probably tricked you into it. I said, let's make sure that the connection between Substack and Stripe is working right. Why don't you just go ahead and put in your credit card number? And the good thing is you kept it rolling. Yeah. All right. I appreciate it. We'll talk again soon. All right. Thanks for having me, man. It's always great to be able to talk to your brother, especially when he's got something smart to say. It makes you look dumb. And that's exactly what Joe does. Every time I talk to him, I hope you guys are enjoying this show.

17:17Please make sure that you're following us on X and please, please, please make sure you're subscribed on YouTube. I'll see you guys on Monday live from the desk of Anthony Pompliano.