Why It’s Still Early for Institutional Crypto Adoption ft. Dan Morehead

26:47And how do you think about that versus the kind of fractional reserve banking system or the inherent leverage in the banking system? Oh, yeah. You know, I hear you that, you know, speculation drives, you know, more speculation. And so some people do use crypto to speculate on crypto. But I think it's a very small fraction of the industry. Most people just buy it as a, you know, store wealth or, you know, for other reasons. Whereas the entire banking system is built on leverage. And one of our big investors is a big bank and invited me in to talk to their executive board. And they said, well, won't this impact bank deposits and then ultimately, you know, corporate leverage?

27:30I was like, yes, you know, there's no other answer. And so I do think you're going to have a world. And again, this is 10 years from now, so I'm not saying it's going to happen overnight, where a whole generation of people is going to grow up saving in stable coins, right? There's going to be a whole generation of young people that just think, of course, you have a digital wallet on your phone. You save in a stable coin. And there are ones like Mike Cagney's figure already has yields out there, which is a yield bearing stable coin. Right. And so there'll be a whole generation of people that go, oh, I just keep my my excess savings and yields.

28:00Right. Because it's it's giving me interest. So you can have that whole thing. And then with banks losing those deposits to stable coins, which have already lost 300 billion to stable coins. And there's only 17 trillion of bank deposit, right? Like it's not zero, you know, it's small, but it's starting to be meaningful. You're going to end up, I think, with a world where what banks used to do is replaced by stable coins and non-bank lending, right? So the leverage that will have to be there will be in, you know, other non-bank alternatives. And the spread will be wider. I mean, I think that's the reality is, you know, banks take a dollar in, they lever it up 13 times and loan$13 out, right?

28:45If stablecoins don't have any leverage, the yield on treasuries will, all things being equal, go lower, and then leverage will be expensive. And so these non-bank lenders will be lending at much wider spreads. And we will definitely build kind of a DeFi stack on top of stablecoins. um so you know i was speaking to somebody and even the treasury's thinking how do we get lending markets into emerging markets in dollars to spread the dollar because scott besant again he's saying this stable coin market is going to go to three trillion within whatever few years uh which is a big chunk of the 17 trillion as you said and it's like well if we can then get foreigners to be doing their borrowing and lending on an app on top of stable coins it's a very big deal.

29:33No, no, I totally agree. And I agree the current administration is spot on. It is in the United States' interest to promote stablecoins because 99.6 % of them are backed by US Treasuries. So it is very good. It's unambiguously good for the United States to have stablecoins be popular. And the next big use case, because the financial system is clearly realizing that its opportunity is here and there's a race. The other one is tokenizing everything. um and that seems a big deal it's like nasdaq and i mean everybody's looking at this now and figuring out robin hood's you know moving a lightning speed on this how do you think about that trend yeah so uh you and i agree that blockchain is going to change the world but it's not going to change it overnight and your statement of tokenizing everything i would say maybe not quickly you know and so there's a great uh i'm on the board of figure and mike Cagney, super, super brilliant guy.

30:30And he said, and he's the biggest tokenized real world asset entity out there. It takes homogeneity and ubiquity to want to be on the blockchain. And that is a great way to say it. Treasuries are the ultimate homogeneous product. Like you do not care if you have the three and three quarters of 2036 versus the four and seven eighths of whatever, You couldn't care less. And they're ubiquitous. Everybody on Earth needs access to U.S. dollars and probably would like interest. So U.S. Treasuries are great. And we're investing in a protocol called Ondo that does that. They already have, I think, 12 billion of that.

31:08Great use case. Right. But we've invested in things where we're a bit early, where we were trying to do like commercial real estate on the blockchain. Apparently, they're illiquid for other reasons than they're not on a blockchain. There's a reason commercial real estate's not on the blockchain yet. So what I would say is, although in the fullness of time, everything will be on the blockchain. Treasuries, U.S. dollars, like stable coins definitely want to be on the blockchain. and as long as the US SEC wants stocks to be on the blockchain, it'd be great to have them on the blockchain. Yeah, because I think if you think about, again, the US's strategic policy, having stocks on chain means that everybody in the world can invest in Tesla and Apple and whatever, right?

31:51It's instant access to everybody. It's impossible, near impossible if you're in India or the Philippines or whatever to buy the world's greatest companies. You can't do it. But this suddenly will have access to everybody. So it just opens up the U.S. capital markets to everybody. And the sucking in of capital is going to be huge. And that's how you service the debt. Yeah, and I was spot on that we've had really kind of primordial versions of that. We've had American depository receipts, global depository receipts. And they kind of work and like wealthy people in a couple of countries can access those.

32:24But you're right. A 20 year old in India probably doesn't have access to a GDR. Right. And they can't buy Apple. And so, yeah, it seems self-evident that it'd be great to help raise capital to U.S.-based companies. And so tokenized equity seems like a very good way to let U.S. companies raise capital. And again, the other half of this that people don't talk enough about financial inclusion, right? Why can't that 20-year-old guy in India get to buy Apple stock? Apple stock's been going up for 25 years, right? It'd be great if that person could actually participate in the capital formation that's making other people wealthy.

33:03Right. So I actually I mean, I just don't see why either side shouldn't want this to happen. You know, we want to raise more capital for companies and then we want to let more people invest. But if you are India, you're going to be nervous because capital flight. Because essentially, A, the rupee doesn't do well over time. and b there is capital restrictions of how much money you can get out but these rails help people get around that and before you know it indian wages are being spent on u.s companies and buying u.s debt um yeah and so that's why i only focus on the united states sec who should be holy for this and yes you're right there are a lot of companies that want to you know prohibit their citizens from participating in the world's economy probably great for them right because they can save in a better vehicle they can get better returns then they can potentially buy more the money will flow that way it's decentralized it's permissionless in the end people will still do it it's hard to stop is the point yeah no and i agree and it's been great right like the internet being again a great example a bunch of countries used to repress information and their citizens had no idea what was going on in the world and as they learned more about the world.

34:17They can get a higher education. They can invest in things. So it is coming that people will have access to the world's capital markets. And the beauty of that is 4 billion people have a smartphone. And that's the only thing it takes to operate Bitcoin. And what about outside of the financial stuff, the other applications of Web3? Are you guys seeing much? Because you guys are very prolific investors in all sorts of areas of the space. where are the other breakthroughs coming because it's been slow right we've talked about gaming for a long time we've talked about digital id for a long time we've talked about all sorts of things but that kind of web 2 to web 3 thing has been slower it has uh been slower than probably people expected um the gaming one we've taken another shot at um admittedly uh there have been some waves of excitement about blockchain gaming.

35:13And at least my take on it is all the past attempts were very, very good blockchain experts trying to do a game that wasn't boring and that didn't work as well as people had hoped. And then some of the ones that did take off were, you know, unfortunately kind of recursive, you know, almost Ponzi schemes where like, you know, you only do the game because you want to sell it to somebody who's going to get more people into the game to do the game more. We're invested in a company called Azra Games that's in my hometown, Sacramento, California. That is the team that built the Star Wars game that was acquired by EA trying to do a bit of Web3.

35:48And that, I think, is simpler, right? A team that actually knows, you know, what motivates people. And, you know, a billion people are into gaming, right? So a team that knows what is fun, but putting a Web3 component on it is good. Because obviously, as you know, blockchain is really good at incentivizing people. digital assets transferability all that stuff um so we're taking another shot at that but um you know and that is one of those things that will definitely happen at some point hopefully it's it's time for it now yeah i'll come on to the um what you're investing in stuff um but first i want to talk a bit about the uh digital asset treasury vehicles because i know you guys are involved in a huge one talk me through the thought process in that and how you think about it it's been good because it's actually been a thought process.

36:36I admit I was pretty skeptical at the beginning a few years ago when it started. I have a friend named Mark Casey who's a neighbor in Woodside, California. And there was a time he owned 12 % of MicroStrategy. And I was like, that seems pretty, pretty wild, right? Like, why are you doing that? And his answer resonates still. He's like, hey, I'm a 40 act mutual fund. I think this is the best investment, you know, of a generation, and I want to help our investors get exposure to it. So they invested less than a billion dollars and now have six billion of returns. And that's really the answer. And I would say that, you know, why we're involved is, I think we're the first firm in the world to offer access to blockchain to investors, you know, helping them get cryptocurrencies, help them get into a blockchain venture, but we've always stuck to SEC, you know, qualified purchaser criteria and stuff like that.

37:32So it's been very hard for kind of most people to get access to our funds. We did sponsor the Solana company, HSDT, with the Solana Foundation's support to help broaden the access to this asset class. And the cool stat is our average investor has$2.3 million with us. The median trade of HSDT is$2 ,200. So it's literally a thousand times smaller. And so it's allowing anyone with a brokerage account to get access to something we think is very important. Obviously, we're very large investors in Solana and the Solana ecosystem. But the punchline is all these different DATs like Tom Lee's Ethereum DAT, the MicroStrategy on Bitcoin.

38:16It's helping people get exposure that maybe the 40 act doesn't let them get any other way or maybe they don't understand they don't have anything but a brokerage account and so look at them as access access vehicles that's first one second one is i i think they're superior to but there is an etf so we've kind of got the access vehicle yeah it's the implicit leverage on top of the vehicle i think is what people like but it also what makes people nervous yeah so that is then kind of the next way to think about it one of my partners had a great line um that's a little bit oversimplified but he goes hey what's the worst case on a debt that it trades at par every day for eternity that's an etf and i really like that logic is etfs are inert they don't do anything they don't increase the number of of tokens per share they just they don't do anything and you're your, you know, your, your default is it just trades at par every day.

39:15So a dad has the opportunity to trade above that. It has the opportunity to generate staking yields and other income that a lot of ETFs do not do. And then the super important one is with a successful financial management, they can increase the number of tokens per share. And micro strategies, obviously the biggest and most obvious example, They grew the number of Bitcoins per share 76 % last year. So paying a premium for strategy stock is rational. Like it has outperformed Bitcoin. So those are the ways to think about it is that if you invest in a digital asset treasury company, you certainly have some upside by multiple expansion.

40:03But most of the growth has been in number of assets per share. Most of the value growth in MicroStrategy, in Tom Lee's ETH, dad, in our own Solana company, has been the number of tokens per share. And in the end, you know, yes, there's a bit of leverage, but then these are not high leverage vehicles, you know, when you break it all down. And I think it's just kind of come down to execution of the management teams. Some will do really well. They'll execute well. They'll use the capital effectively. and those that don't and don't attract capital will probably trade like close end funds that are discounts and probably get bought by somebody else and unlock the the uh the discount to nav spoiler alert you've already seen this movie yes what you just said is what's going to happen yeah that there are probably one or two really good uh management teams in each each uh currency and they'll do a good job.

41:01They'll increase tokens per share. And your point's very valid. We all come in with the skepticism. We all think, oh, it's just leverage. It's pretty low leverage. Many of these, like, you know, our Solana company has no leverage. MicroStrategy, I think, is about 10 % leverage, you know? So it's there. It's kind of like a little bit of the icing on the cake, but it's not, like you were talking about, you know, 20 to one perps or whatever, you know, It's not that scary. And so it is about teams that can manage the financial engineering well, can grow the numbers of tokens per share. And then, yeah, you're right.

41:35Probably most of the rest will trade at a discount, like closed-in funds, but then probably get rolled up by the bigger ones, right? And that's really the reason we actually issued a fund to invest in DATS for our LPs as well. because I think it was one of those trades that if you invest in a DAT, yeah, you might make 100 % return or 200 % or, you know, some are even trading like our BitMine investments up 10x, right? You might make that. And again, you always have to caveat any kind of worst case kind of statements, but it seems like they can't trade it more than the 15 % or 20 % discount or somebody else is going to roll them up, right?

42:14So anytime you can have a trade that's that asymmetric where you have 10 or 20 % downside and then, you know, 100, 200 % upside. You know, it's a good trade. And we've invested, we probably have a billion dollars in the space. And I was at a kind of group event and some investor was complaining that, you know, DATS on average are only trading at 1.7x, you know, their costs. And I'm like, that's why I love blockchain, right? You make somebody 70 % in like three months and they say it's not good enough, you know? So it's like back in the real world, like you and I used to live in, that's like five years of grinding and like getting up for every CPI release and like sweating it, you know.

42:58And so that's why I love blockchain. Like, yeah, we're only up 70 percent or whatever in two months. So, you know, most of the financial engineering, you know, Michael Saylor and Michael Strachey is kind of the market leaders in how to think about their financial engineering. It's actually in the in the equity stack is what they're doing is like, you know, It's the dial of how much can you sell the ATMs before you collapse the premium? Where do you do with the preference stack? How does that all fit together? That's really where it is. And that's what increases or decreases the value versus NAV over time.

43:32Yes. And their company has done a great job at that. And so obviously, that is one of the key components. I would say the other component is essentially evangelizing for your token and your company. And Michael Sayler's done a great job. He has messianic following. People love that. And so that's brought people into the Bitcoin ecosystem. I think Tom Lee's done a great job on Ethereum and telling the story and getting people excited about it. We're going to endeavor to do that on Solana. But that is part of the job is actually getting out there and helping people who don't know anything about crypto.

44:08hear the story. And we haven't done the stats yet, but I really want to do this. I'd love to see the number of people that are trading HSTT that have not been involved in crypto before. You know, that's what I want to see. And as you know, from 2012 on, the virality rate of crypto is like 95%. Like you get a smart person in a room and you actually make them sit down and think about it for an hour. They're all like, oh, yeah, I should buy some crypto. And so anything thing that increases the visibility of crypto is good for our industry. Getting, you know, Michael Saylor on TV, getting, you know, Tom Lee on TV, those things are great because then people read about it and they'll go, you know what, I probably should have some exposure.

44:50And again, they start with a 1 % or 2 % and then 20%. And so it's great. I think all these things are really, really additive to our community. So what's the investor base now, the new investors coming into Pantera, whether it's in the liquid side or in the VC side, what type of investor are they now? And how's it changed in the last five years? Because it was a lot of family offices and high net worth, right? That was the base. And then everyone got a few flagship institutional staff they're very proud of. But is that changing now? Are we seeing an acceleration in larger entities? We are. So you're right.

45:26For the 12 years we've been doing this, it's kind of been the same mix, you know, high net worth people, one or two endowments, one or two, you know, insurance copies, one or two of these corporates, whatever. I think the difference, the election in the U.S. made a huge unlock. So we went from the biggest country on earth with the kind of leading position in regulatory stuff being aggressively negative against our industry to being extremely positive on our industry. And that's a huge unlock, not just in the US, but globally. And what I would say there is, you know, as you remember, in 2020, 2021, there was a lot of big public pension plans that were announcing huge, you know, programs and blockchain.

46:10It was all very, very trendy. And it seemed like it was about to happen, right? Unfortunately, you know, FTX blew up, Terra Luna blew up, you know, a bunch of levered entities, BlockFi, Celsius, all, and unfortunately, quite a number of those had big, big, big public investors, right? And so it was just about the worst timing possible is to have everyone go, hey, we're going to get into the space. And then within like six months, it all go terrible. And then you had the United States Securities and Exchange Commission suing the best firms in the space, like Coinbase, Ripple Labs. So like, how are you going to run that up to your IC, right?

46:45That you want to put your career risk in going, you know, into blockchain, right? When all that's going wrong. That's two, three years in the past. And now the administration has changed. Congress has changed and the SEC has changed. So all of that stuff is back to, I would say neutral, right? Because as you said at the beginning, it's just the technology. Like this shouldn't be a partisan thing. It should just be like cell phone. We're all kind of in favor of the cell phone, right? So that's really good. And where I'm going with this is the current administration has created a Bitcoin strategic reserve, massively important because that gives leadership to countries that are aligned with the U.S.

47:25to do that as well. So there are a bunch of countries, as you know, like the GCC states that are pegged to the U.S. dollar, aligned with the U.S. and security matters and other things. So they're now really aggressively getting into the blockchain space. Yeah, I mean, last time I saw you, we were both there in Dubai. But exactly. And so if I were to roll this movie forward, we're currently raising our fifth venture fund right now. And at the end of next year, we'll be done. If we get together in the next year, I would say that'll probably be the big difference is a lot of more sovereign investors, especially ones that are aligned with the U.S.

48:02like the GCC and then even U.S., you know, pensions, endowments, all the people that kind of, you know, got got scared away in 2022. that would be the big difference for our own fundraising. But then I think it's important to zoom out one more step is I think it's obvious that countries like the UAE has done a sovereign investment in BlackRock's Bitcoin ETF publicized, and I'm sure they're mining a lot of Bitcoins and buying a lot of Bitcoins in non-public ways. So that's, in my opinion, very, very obvious. But I think the counter argument is obvious too. the countries that are adversarial to the United States are going to start buying Bitcoin.

48:44And it's not something people talk a lot about. And one of those countries is, quote, officially banned Bitcoin. But if you like think about China, right, they spent 2000 years working really hard, saving a lot of money. And all their savings are in something that's got best and can cancel. like I mean that's really pretty edgy you know to have all of your life savings for a couple thousand years in a security that the U.S. Treasury Secretary didn't just say you know what now we're gonna cancel that so I think it's pretty obvious that the countries that are adversaries of the U.S. will ultimately buy Bitcoin and potentially other coins but I would say at least start with Bitcoin and so I think I think there's gonna be an arms race right and And there'll be like Dr.

49:30Strangelove, strategic mineshaft gap, right? Like it's going to be a real race. And as you know, there's only 21 million. And if a bunch of people want to buy a million each, it's not enough to go around, right? And there again, that's why I'm so bullish because there's just not enough Bitcoins to satisfy countries' desires. I think the U.S. has 200 ,000 Bitcoins just from confiscation. It's kind of a random. And China has roughly the same, I think. Yeah, and China has roughly the same. i have i mean no problem seeing them wanting to buy a million bitcoins um you know yeah i mean it's still tiny compared to their balance sheets budgets all that stuff and so if you you have two three four like say the gc wants to buy a million china wants to buy a million maybe russia wants to buy some us like it's gonna squeeze up like a watermelon seat yeah that's true so talk to me about the new fund so because i got the email in the inbox what are you what are you focused on in this fund?

50:27Because you've had both Liquid and VC within them as well. So we're doing the same as we have done in our previous fund. We're investing in all the assets of blockchain in one fund. So in our earliest days, obviously, we launched the first cryptocurrency fund in the US, the first blockchain venture, all that. So we had separate funds. We think it's way better to do it all in one. So in our fund that we raised in 2021, One, we had both venture equity, private tokens, special opportunities and liquid tokens all in one fund. And it's really worked. It was a little edgy at the beginning. You know, it's a little hard to create this new thing.

51:08We also let our investors pick. They could have all in one or they could have just the private so they could have just venture. That has been a fantastic structure. The proof of that is we have not even finished calling all of the$1.25 billion that we have committed for our fourth fund. But we already have more than two X assets in the fund. So we've been able to use those commitments. We launched it in 2021 and finished in July of 2022, and the market crashed right then. So we were able to buy a bunch of liquid tokens. That's perfect timing. Like Bitcoin and Ethereum at the lows. And as you know, the venture markets take like 18 months to reset, right?

51:50Everyone still wants the old price. Nothing happens. Zero trades happen. So we're able to buy really cheap tokens when they crash and then hold them. And over the next 18, 24 months, they started rallying. But venture kept going down. And so this all-in-one fund allowed us to hold tokens when they were cheap. But then when they got expensive, we could sell them and invest that into venture. And so we've been very dynamically investing this fund in that way. We've also done quite a few really cool special opportunities. I think I mentioned the Solana trade we did with the FTX bankruptcy estate.

52:24So we knew they would need to sell a bunch of Solana and that they need kind of deep pockets, people that had capital locked up for a good period of time. So we ended up buying a huge chunk of Solana from the FTX bankruptcy estate at about 50 cents on the dollar. And the power of our new fund is evidence in a slide we just put on our investor letter called Two Cubed Solana, where we have doubled the value of our Solana position three times by doing things like that. So we originally bought it at 50 cents on the dollar. The discount allowed us to double it. The price of Solana Spot has actually gone up 84 % since we started.

53:05It was at 150. It's at 240. So a normal investor would have made 84 % if they bought Solana. We also staked it and made about 7%. And then the other ones, then we created the Solana company and contributed our Solana into that. And then that's gone up 2.4x. So our holdings of Solana have increased 850%. At the same time, Solana has gone up 84%. So this is your version of the tokens per share. Yeah, it is. It is. And it's funny. You know, I know you've heard this so many times. I've heard this for 12 years. Well, I can just do that myself. And it's kind of like those old adventure shows where they're like, hey, kids, don't try this at home is more difficult than it seems.

53:55It's hard to access things like the FTX. You don't get the access. like that. That is hard. And so, you know, we've been able to make 10 times the return that a normal investor would be able to. And so that's the power of this new fund, doing all in one, that we're doing these interesting trades, you know, that really just don't, that are very hard to access in a normal way. And it's because we have 85 people and we're out there, you know, we've just been doing this longer than everybody. And we're seeing things that, you know, other people aren't. And we did that as well with Bitwise. It's the leading provider of ETFs in our space.

54:34Last year, when the USICC finally approved ETFs, there were 12 applicants, right? And, you know, the world doesn't need 12 Bitcoin ETFs. You need just a few. And liquidity pools very quickly. So we did a deal with them where we seeded them with$200 million, which is a massive ETF, because we have a billion in Bitcoin on our balance sheet, and got 5 % of the equity in their company and it's been very uh beneficial for both sides they they now they launched with 227 right so they they they raised 27 by themselves and then 200 of ours uh and now they have 14 billion under management you know so i love hunter and that team are brilliant yeah he's wonderful i had lunch with him yesterday super super super nice guy and they've done a great job but you know it was a partnership we helped them you know kind of get off the launch pad they've done everything since then.

55:20But it's a great example of how our hybrid style fund can do trades that just, they're hard, you know, they're hard to do without having all the pieces together. So final question, how do you see kind of the rest of the year and next year playing out? When do we, because we've got this cyclicality, my view is it's been pushed out somewhat, but we'll still have cyclicality. How are you thinking about the next kind of six to 12 months? Yeah. So there is a cycle and I've long believed in the four year cycle. And when Bitcoin was super low in the last bear market, we put out a prediction based on the past two halvings that we've been involved in.

55:59This is our third halving that given the current ratios and they do change each time and get more muted each time. We forecast a couple of years ago that Bitcoin would hit one hundred and eighteen thousand five hundred forty two dollars on August 11th, 2025. And it did. it's super crazy it literally hit exactly the price and i'll admit it did it one day before we thought it would do it it did that's freaky that's freaky we're living in a simulation freaky and we did that the last time too we we thought it would hit 69 000 in august of 2021 and it did that day and so the punchline is we really really nailed it predicted that cycle that was awesome but then one of our investors on a call said but doesn't that mean it's going to go down today you know you predicted a peak and won't go down in the you know the fate most fatal words of any investor is but this time's different and so you know with with all humility and saying that i would say that although you know the past cycles are are indicative or predictive of you know how it's gone in the past, the regulatory changes in the U.S.

57:12I think just trump everything. They're just huge. And so I think we still have another leg to this rally to go. And so I think if all these endowments come in, all these sovereigns come in that we're seeing, you know, frankly, we're going to put the money to work, right? Because when we raise the money, we're not going to like sit around for five years. We're going to do it. And our peers are going to do the same. So I think the next six to 12 months are still big rally. And again, And I know it's, you know, it can. I know it's horrible because you're going to be hung by the Internet by saying you said it was going to extend.

57:44But I think it's going to extend. Yeah. So the, you know, the fun fact on the markets is when it has peaked in the past is when we've all been the most bullish. Right. And Christian Carla, the former chairman of the CFTC, spoke at our our investor event right after this happened. And he goes, hey, do you remember what the peak was in the bubble that was in 2017? I was like, no, no idea. The day CME listed futures. That was it. Remember that? Oh, we're going to the moon. You know, as soon as CME has futures, we're going to the moon. That day, top, down 85%. So then four years later, and it really is pretty much a four-year cycle.

58:24Everyone was talking about an event. Everyone was so bulled up. It was going to be the big - Coinbase listing. Coinbase listing. the top. And the next day it started its minus 85 down trade again. So each time when we're all drinking the Kool-Aid and we're all like, this is so good. There's been an event and then it goes down 85%. And so I'm praying that, that we won't have another down 85. Uh, and I'm praying that we're not drinking the Kool-Aid right now, but like, that's the way we should be thinking is that, you know, we got to be you got to be looking for those signs. And I'm open that something will come.

59:03But I still do. It just feels like money's coming into our space. We actually did just hold our annual investor meeting at the Plaza yesterday. And one investor said one of our longest investors said he could see the fear in the eyes of the people who are under allocated. and i love that line because we had you know brad garlinghouse and all these co's that just completely have been crushing it on stage and you know after you know you know eight or ten of these people talking about how they're changing the world you know uh robotic autonomous quadruped dogs and stuff like it's super super cutting edge stuff and if you don't have you know eight or ten percent of your assets in blockchain you're going to want to like slip out of that conference you to slip out of that conference and call your broker right like i've always said that it's like anybody who doesn't have a position it feels like you're short the upside calls yeah and you just have this horrible feeling all the time it's like fuck i need to buy those back no you do and and one of the the kind of telling kind of dynamics in our industry is there's so many times people say hey aren't you worried that such and such smart you know manager still hates Bitcoin.

1:00:15That's the upside. They're short. They're going to buy. And I was on a panel at the FII conference in Riyadh, Saudi Arabia, with literally the heads of all the like super amazing public alts managers, right? Almost all of them were like, oh, no, you know, Bitcoin's a fad. I'm just like, you know, I've been hearing that for 12 years. And I'm so bullish because you're a very smart person. And someday you're going to spend a couple weekends reading about crypto and you're going to go, oh, I got to buy some of this. And you're going to put your$110 billion firm into our space. And that is why I'm so bullish.

1:00:51There's still so many really smart people that are still just so skeptical and negative. And I, yeah, you know, I encounter them all the time. And I met with one yesterday and he's like, you know, I apologize for being so skeptical. I'm like, you know, I didn't come to preach to the converted, right? Like I'm here to help, you know, change people's minds. So here, I've got a lovely little story to wrap up for you with. So when I first discovered this, I wrote that macro strategy piece that you remember from a long time ago about how to value Bitcoin using gold as a framework. And I said, listen, it's probably worth a million bucks.

1:01:26Let's discount me by 90%. It was$200 at the time. I said, it's worth$100 ,000. Cut to when Bitcoin hit$100 ,000. I was at dinner at Wences is his house who i met through you with mickey malca and wences caseros celebrating that hundred thousand i i was thinking fuck me we've come a long way yes we have and and it's it's so good to kind of appreciate how far we've come um and i was thinking back to our original gatherings we got you know kind of the bulk of the bitcoin community into my house in lake tahoe i think it was that small there were so few people that cared so we've come a long way which is great but again most the majority of institutions still have 0.0 you know we still have a chance so we still get a chance to front run them in mind the internet's 53 years old and they're still doing cool internet companies like it's it's not over and uh on halloween bitcoin's turning 17 you know so you know we're getting we're a teenager i mean it's happening but like we still have a long way to go dan fantastic conversation really really good to get together with you and hopefully we'll We'll do it in person soon.

1:02:38Oh, please. Love to see you soon. As ever, Dan is a lovely guy, incredibly thoughtful, and giving us a deeper understanding of where this space is going, how it's evolving, and what it all means. You see, it's only in having conversations like this do we get to move our own thoughts forwards to help us build that framework of understanding that we need to navigate this journey. And this, what I think is the greatest macro trade of all time. Anyway, see you next time. You obviously enjoyed the episode because you're here with me at the end. But listen, don't forget to go to realvision.com forward slash join and grab a free membership.

1:03:16It's an incredible community packed with alpha, great investment ideas, and the research that you need to help you unfuck your future. So get started now. Go to realvision.com forward slash join.