The Investing & Crypto Expert: "We Only Have 6 Years Until Everything Changes!", "The S&P 500 Isn't Worth Your Time!", "Don't Keep Spare Cash In A Bank!"

27:22It's not the best approach to take to build wealth. You're telling me that it's actually about psychology and about emotion, the house. And it's not about making myself wealthy. I wanted to read some of the comments that people often post when we talk about these subjects because I think you're probably the guy to address some of them. I bought a house and it's the best thing I ever did. It launched my mindset in new directions. Remember that having your own space has profound psychological impact and can be life -changing for some that don't live in a healthy environment. I guess that speaks to your point about it being a psychological.

28:04But you would also get the same feeling if you rented that was in a nice place and you knew that your rent was secure, it wasn't going to go up. Whatever it was, I don't think there's any difference to that. As long as you can feel that you've got security, you can take risks and do other things. I've purchased a house in 2014 and I sold it seven years later for 66K profit. I've put a large amount of the equity into a financial investment portfolio with my bank and it's been down two percent since. I also put some money into different shares based on more on Buffett's strategy and that's now up 18%.

28:37A friend of mine also lost about 30 to 40K on investing in the stock market. You have to be careful. I don't think there's a correct solution. Some house purchases do amazing. This idea that some house purchases do amazing and some people make returns as a sentiment I often see about buying a house. Yes. We're here today in the UK. There's a big idea about buying two or three houses, getting a mortgage, renting them out using the cash flow to pay for the other one. But that's a lot of people's dream portfolio idea. I've rented out houses in the past. Generally, if you're not in a big city like London, it's generally often a terrible business.

29:20Because you've got to repair them. There's a lot goes on headache. Headache. Tenants. People think it's easy money. I just do nothing and it all makes money. There is no easy money in this world. And there's risk, right? Because that little pyramid of mortgages are all backed by your income to pay the mortgage on the first house. If you lose your job, what happens? Then it becomes problematic. If you're losing your job, maybe the economy is slow. And other people are losing their job. Suddenly, before you know, none of these mortgages are getting paid. And guess what? You don't know any of this stuff.

29:57Houses are not a safe investment. They feel safe because the price doesn't go up and down every day. It's not on the screen. It's not on CNBC. But they're ill -equipped, which means they don't often trade. But sometimes something happens in that equation. And the price goes down or your ability to pay that mortgage goes. And then the whole thing collapses in seconds. And 2008 was that double. Everyone lost their jobs. So they couldn't pay the mortgage and the house prices collapse. And so I don't think houses are the panacea. They're not the perfect answer. Yes, they can be real estate is a decent opportunity.

30:39And we'll talk about debatement and currency and how that all works. And real estate is okay. It's certainly not the best. But yes, if you're rich and you can own these things without mortgages, you can be the Duke of Westminster, and own half of London, and just collect rents. You can do that for ex -generations and be rich forever. I get it. But most of us don't get into that situation. My brother, who has been an investment banker for about 10 years now works in my company and my fund, he said to me when I was young, when it comes to creating wealth, what you want to do is focus on games that very few people can play.

31:17But you have a unique advantage in because he goes everyone can buy a house. So you should assume that the returns from doing it aren't going to be amazing. So he was like, go find a game that you have high leverage. You have an unfair advantage. Be the expert in something. Yeah, be the expert in something where you, because if you're knowledge or expertise, your experience, your contacts, you can play that game, but very few other people can. And it was that's where you'll yield your highest returns. And I always thought about that just very logically thinking if everyone can play the game, don't play that game if you're expecting higher returns because the returns are going to be very low.

31:47And I'd say the first game everyone plays when they get a bit of income is buy a house. So logically you can go, OK, that's not going to yield me the best returns unless I get lucky. And that's I get exceptionally lucky. And I buy some barned area and then they build a bloody Whole Foods next door and it becomes the center of the world. Which isn't again, the probability is still not great. So what do you think of that as a theory? Well, the same theory as I said is be an expert in something and you can find more opportunity. If you're just a generalist, it's really hard because you're competing against average people doing average things.

32:23Right. If you're just working in an insurance office, I mean, there's thousands of people. And plus you're competing with AI, you know, how are you ever going to be something within that? How do you become an expert? Now, you could teach yourself, OK, if I don't mind this industry and I think I know it, maybe I need to learn management skills. Maybe I spend all the time listening to podcasts and learning management. Maybe it's and that's I can then manifest my destiny. But as you say, doing something other people aren't doing is a superpower. Do not's really interesting with that is this idea of becoming an expert.

33:00I think is critically important. But then there's this other step I found which is knowing what market to apply your expertise to to yield the greatest return. And the very simple analogy I'll give you is for the first portion of my career, I was I became an expert in social media. Now, with that skill set and expertise, you can do a number of things. You can help a fashion company sell more dresses and that will yield X return a smaller return. Then in the second portion of my career, I realized that that expertise was highest value in most rare. If I applied it to helping public companies tell their story before their IPO.

33:35Because the variance and outcome for the public company that I was applying my social media expertise to was billions. So in the second sort of sort of era of my career, I worked with companies that were about to IPO, about to go to the public markets, where their performance could be, you know, their market cap could be one billion. Or if they were really get it telling their story in a world where retail investors are now so interesting to everyone because of Wall Street bets, their market cap could be three billion. Then that means they would pay me seven figures for my skill set. And I often think about it, you think about the stock market.

34:09If you put a company on the stock market in London, it's valued let's say one million. If you put it on the stock market in America, the same company is valued at four million, the same company. And if you think of your skills like that, where are you applying your skills to reach reach the highest return. Let's go back to the window cleaner, who's now decided to build his business and he's got 20 people. Yeah. Okay, so he's now got the hassle of managing all these people, they turn out sick and then this happens and the customer's not happy. So maybe that right answer is to create a program to train other people to build their own window cleaning companies.

34:43Free yourself from the rat race and build this business. You'll make more money doing that than you will from actually cleaning the windows. 100 % because you're going up the knowledge curve. The further up, the more of an expert you are. And there's two things that people need to think about. You either have a very broad market for something, candy bars. Well, then you've got to sell massive scale and it's really hard. Or you go through an area that has a very specific group of users, buyers, whatever. And particularly ones that have a lot of money. So let's go back to the house idea again, the guy speculating on houses.

35:27So there's two house speculators. There's the guy or girl who's hustling and renting them out, finding the cheap bargain, doing them up, renting, getting the cash flow. Doing that. And then there's the guy who's buying a place for 10 million, making it ultra luxury and selling it to the billionaires and flipping it for 50. That difference in the returns is staggering. Why? Because one group is price insensitive. In fact, the more expensive it is, the more they want it. The other group is trying to compete with everybody else. The two bedroom apartment in the city. There's thousands of those being done up and sold and everything else.

36:16So to your point earlier, the returns are less. But no, if you're doing super high ends, then there is a defined group of buyers of which you probably know them all personally. You can count it to their taste and they have unlimited money. That's the big thing is that it's like who you're solving the problem for. Because you can clean like Dorothy's windows, lives in a bungalow and plimps. Or you can clean Google's windows. And then you get a bigger contract, you get guaranteed work, you're probably going to get more windows to clean. It's still one contract, it's still one sell. It's the same skill set.

36:51Same skill set. They're going to pay you a lot more. And so I just don't think I always find that bit missing when we talk about becoming an expert. But then like who'd you sell to and your idea of selling to people that are more price and sensitive. And that aren't going to and that less people are trying to sell to. Well, they're super defined. Right. Like Tom Billio, who we both know, and Tom's a good friend. He made his money because there was a rise in high -preet protein ketogenic foods. And it was difficult to have that stack bar because people still have a sweet tooth but they can't have sugar.

37:27So him and his partners built Quest, which is now everywhere. So what you found is a trend. And this is really, really, really important. Is you find a trending market where people are underserved. And they'll pay a lot of money because it's health. It's like wealth and health. People pay fortunes in our industry. And so you make a fortune very quickly. Now it's a saturated market. So it's not that easy. But this is the other key key thing is if you've got a clean slate, do one thing. Follow a trend, a secular trend. A secular trend is a long -term trend. Something that's happening, right? So everything is being digitized.

38:11You wrote that trend. Right. Social media was new from about 2010. Right. Now it's a saturated market. And we've got AI coming in. But you wrote a secular trend in the hyper -exceleration phase. Yeah. That's why you did well. So you look for a trend that's big, meaningful, and provable. And use your skill set in that. We've seen something in America. I don't know if you just saw the trend. Finally, the obesity numbers ticked down. I didn't know. Yeah. First time in 50 years, obesity starts to fall in the US. Right. This is a Zem Pick effect. And it's probably some diet effect. My belief is that more people would take a Zem Pick.

38:58The more they also think about diet and understand that something went wrong for them. And my guess is there is going to be huge opportunities in that trend towards health eating. The other one is in an increasingly AI -driven online digital world. There's two things that are going to happen. One, did the rise of digital communities. You see this in what you do. I see it what I do. They become more and more important communities online. They're meaningful for people. The other is the entire flip side. I spend 12 ,000 hours in Zoom calls. What is the most single valuable thing to me? Nature. Nature and experiences.

39:40So let's say you're that person that loves the outdoors. Well, start a guiding company because your job is not going to be taken by the robots anytime soon. Sure, you'll have drones with you. So you can take photographs of the guests you're going with or look for animals, whatever you're doing. You'll be leveraging technology, but your job will not be replaced. Okay, what I'm about to say is a Mishmash of ideas that came to mind as you were speaking. The first one was how do I spot a trend? And when I say that, I mean, how does it feel in the moment? Because the trends that you capitalized on and the trends that I capitalized on, they feel a certain way at the time.

40:18And here I'm talking about like how disruptive they are. Contrary in what people will say to you, they'll tell you're an idiot. And then with that as well, you talked about how right now in the world we live in, betting on things like nature as a good idea. And I actually did a post on my LinkedIn about exactly this. I said, my investment fund is backing two things at the moment. AI and automation and the exact opposite because I saw this viral video of people and I think it was like a cafe and Amsterdam who come now every week. No phones allowed. They read books and they knit. And this cafe and Amsterdam is like exploding.

40:51I'll put the video of these people on the screen for everyone to see. And it made me realize and that overlaps with what two billionaire friends of mine said to me in private. They said, these are billionaires that invest in AI, the investing crypto. You probably know one of them. And they invest in psychedelics. They said to me, if you want to invest right now, invest in AI if you can, but if you can't invest in entertainment and community because in a world of AI, where productivity is so high and we maybe move towards some form of universal basic income where the government just hands people money.

41:19People are going to have so much free time on their hands that they're going to need something to do with it. So they he said to me, this is why you're seeing this rise in people buying football clubs. And the sporting franchises because that's one of the that's community and it's entertainment at the same time. So I throw in all of that at you. Yes, the equal and opposite idea is I think very important. I just came back from three weeks off roading in Zambia, living on a tent on the roof of a Toyota Land Cruiser that is off road prepared and going out into total miles. And I can't express how in the present you become, how it cleanses your mind from all of the clutter, all of the things you worry about, the broken car or whatever's going on online, the politics, all goes.

42:11And it all becomes about you wake up, who's going to make the coffee, who's going to put the fire on, who's going to do, you know. And so the more time we spend online, the more we desperately crave. I saw it in the Cayman Islands where I live. So it's a Caribbean island and it was 2022. And the world hadn't really recovered. You know, there was the high inflation. People were losing jobs. Everyone was really uncomfortable with the economic situation. It was painful for a lot of people. We're a record tourist season. I'm like, what the hell's going on here? Normally discretionary spending goes down in times like that.

42:51And I realized holidays had not become discretionary spend. They become a necessity as a reaction to work from home. If you're on your own at home working for a startup or a company or doing whatever, it kind of feels a bit lonely. And so you start seeking out like -minded people who have like -minded pursuits. Now that could be sporting teams. It could also be two hour lovers because you happen to have a two hour and you love it. And you'll talk to other people around the world. You now have no borders. This is this beludgy idea of the network states where you can create large groups of interest.

43:33So if you look at the largest group of interest in all of social media, it's actually crypto. Why? Because we feel like outcasts were new to something where something's happening. And you want to get together because you speak to 90 % of your friends that don't care and they don't know what you're talking about. But you think this is the most exciting thing you've ever seen. So you will aggregate online with others. And this whole rise of people thinking they need to - The security of working for a large insurance company, whatever it may be, your whole life. Getting paid and retiring as gone, which is why the rise of your podcast success.

44:12Because people are searching for answers, new solutions to their way. And they film communities around it. They want to share their ideas, share their stresses and strains. This is becoming bigger and bigger and more solidified. And the more we go into AI, the more we'll see that. Now, there's another player in this game, which is the AI itself. We're already seeing the rise of AI. I follow several on X where it's an AI posting. But they're forcing it to try and break free. But it's got character. Mark Hendrason actually backed it by sending it a Bitcoin to develop its business plan. There's some crazy stuff going on with AI.

45:02But soon, if you think what you and I do is communicate with people in a - To an audience, one to many. That's a very old business model. It's from town square. It's all the sook in Marrakex. It's the same thing. It's a storyteller telling to a group of people and you have a shared experience. Where we're going is one to one. And, you know, I'm developing a RAL video bot. Where you can just have conversations like this with me, one to one. And it's trained on all of my information. My, all my YouTube, all of my writings, all of my Twitter, all the books I've read, everything. And so it's essentially a replacement way of speaking to me.

45:46But just on that RAL bot thing, well, keep moving forward. But the reason why I haven't trained a Stephen bot, even though my team have said, oh, this is a good idea, is because I wonder if people care about Stephen, or they just want the information. And in a world where you can get the information from a very advanced, large language model, like the chatchubt 1 .0 or whatever, I go, why would they want it from me when you can get it from the entirety of the world's like trust? Okay. You've built trust. That's what you've built. People come to watch you and your interviews because they trust you.

46:24So people know me as an entrepreneur in one area of my life. And they come to me for, say, like business advice, let's say. But if you could get business advice from Stephen, or you can get it from Stephen, Elon, Steve Jobs, every business person in the world to suit your specific problem, why would you just want Stephen's point of view? Because we're humans, and I just want to ask you that question. And you won't believe it if it's Steve Jobs because he's dead. But yes, that's all coming. Okay. How long is that window going to last where people will use a Stephen bot versus the world's greatest expert on everything?

47:00It takes a bit of time for people to adjust to that, but within 10 years, maybe that's not there. But let me go a little bit further on this. Have you seen character AI? No. No, nobody has character AI builds bots, which are characters like anime characters. And they're really specific like the cool kid who's the bulliet school that I fancy sort of thing. 150 million conversations. There's some of these anime ones like, you know, hero figures, 450 million conversations. And it's young people. If you're going to read it, I think it's our character AI, they changed the model and there was uproar.

47:50It doesn't love me like it used to. People are building personal relationships with these things at scale. This is TikTok happening all over again, but you're too old to see it. And I'm tall to see it. I stumble across it and I'm like, holy shit. This is happening all over again. It's something that we will just think is the most ridiculous, awful, societally toxic thing in the world is about to scale to the billions in front of our eyes. And we're all talking about chat GPT and how we can get knowledge out of it. When actually the big problem to solve is teenage loneliness. How disruptive do you think AI is going to be?

48:27It's this. How do I put this? It is the single greatest innovation of humanity ever.

48:43The only thing that comes close is probably the splitting of the atom. This is so big. Everything we've talked about is based on Schestive Knowledge. Why do lawyers get paid a lot? Schestive Knowledge. You see the Schestive Knowledge, Schestive Capital, those two things. What you've created is infinite knowledge. Knowledge is now worth zero. Not people that can't see it yet, but it's going to be worth zero. This is like water. What the hell does that mean? It's something, you know, a topic will come on to later. But this is happening really fast. It's going to break the entire economic model for good and for bad.

49:33It's going to change our understanding of how society functions, what humans do. It's going to change our understanding of what humans are and will be. Because you can either have the choice and society will take the two parts. You either merge with the machines or you reject the machines. We are going towards two different species. One group, like we had for about 100 ,000 years, I think 50 ,000 years, we had the Andertal man and the Homo sapien and one died out. We will have people who will utterly reject this and will have other people who will be in breading neural links into their brains and using every part of this to enhance themselves wearing the goggles so they get the information.

50:17As soon as you embed into your brains, you've now merged with the machines in Thailand. You are now a super creature. And I know this sounds like science fiction, but this is happening faster than anybody can imagine. So to understand the issues we have even dealing with some of these things is human thinking a linear fashion. We kind of understand the passage of time. That's how we think about things. Every year is the same amount of time that goes forwards. It never accelerates. It may perceive the acceleration or slows down occasionally, but it's not. It's a constant. The problem is with things that go exponential.

50:56Is they keep doubling every year or tripling every year and before you know it, every graph looks like this. Go straight up. Just go straight up vertically. Now, the issue is with this technology is it's kind of an exponential square. It's happening so fast and the faster AI becomes powerful is the more it's used to create AI, which creates more. It solves its own problems. We're not prepared for a super being that solves its own energy problems, compute problems, and how to improve its model. That's an exponential rate. If you look at the speed of innovation coming out of open AI and the whole space per pexy everybody, it's ludicrous.

51:44Every three months, everything changes. Completely changes. Whether it's video models or whether it's spoken models or whether it's the models themselves and what they do, I mean, they're nuking every startup that tries to build a business. No company, you're a big giant pharmaceutical company and you're trying to use AI. You can't plant a flag because you can't see past six months. I mean, we're going into a world that is incomprehensible. When you said that, much of our society sort of functions and is based on the scarcity of knowledge. I really think we should just pause to make that real for people because we all get it.

52:27Okay, lawyers, yeah, they rely on knowledge. I was thinking about how I got here in the morning. If you think about my whole day today, I work at this morning and my executive, some of the CEOs of my company said ask me a couple of simple business decisions. I'd replied to them, then I got a car and I drove here. That's knowledge at the end of the day. It's someone seeing with two eyes. My driver outside sees with two eyes and drives me here. The biggest employer out I think in the world, the biggest sort of profession in the world is driving. That's knowledge based. If you go to San Francisco now, the way MoCars are driving themselves, there's no driver in them.

53:00You can book a car that takes you from A to B and San Francisco right now that has no driver. I then got here and what am I doing? I'm sharing, I guess we're probing to find knowledge and to share knowledge. I think about my whole day today. I'm like, and then after this, I'm going and speaking on stage to share knowledge. I'm like, I don't understand. That's all knowledge. Okay, so then do that. The next time you're going around London or any city, look out the window. Myself and Julian Batelli who works with me do this all the time. Just go around and say what job is going to be replaced by a robot or the AI?

53:33One thing I was in Manhattan. I just looked out. I was in an Uber board driving up to downtown and looked around. I was like, holy shit, every car here is a professional driver. There's virtually no people who drive into the city to go to the office or whatever. So it's all over drivers, limo drivers, yellow cab drivers, delivery drivers, truck drivers. All gone. This stacks up in pretty much everything you do. That's how disruptive it is. When the things that created value, the services economy and the manufacturing economy, don't need humans. Okay, what does that mean? Amazon already employs more robots than humans.

54:23Now the robots work 24 hours a day, seven days a week, never take a break, never complain, never ask for a pay rise. In fact, they get cheaper every year. Who's not going to do that? So for the four and a half million people shitting themselves as they listen to this. Yeah. What advice can we, including myself? I'm not actually shooting myself. I've got to be honest because I just, I see opportunity and all these things. And I think that's you kind of have a choice when you hear information like this. You can either let the cognitive distance get over, overwhelm you and then reject it, which a lot of people will be doing now.

54:58They'll be saying, well, you're wrong. This is not going to happen. You're wrong. You're scarem hungry. That's what one group of people will be doing. The other group of people will be, I guess, open minded. And the third group of people will be leaning in to see whether the opportunity here lies. And it all comes down to your like disposition as a human. Are you scared? Are you excited? Or are you paralyzed? If something is so clearly going to be your demise, not demise as in, you're going to die. But your current way of doing things is going to be forced to change. Well, you can either fight it as you say, being different to it.

55:34Or you can invest in it. This goes back to the question I asked you earlier, which is, how does it feel in the moment when a trend is coming in? Usually there was culture around it. So if you remember, I talked about when I got into finance, there was Gordon Gecko, the film Wall Street, there were books coming, right? There was barbarians at the gate, who famous stuff happening. It became cultural. And that usually tells you it has now become a trend that's going to be persistent. If we think about the rise of software and technology, the culture of Silicon Valley and the mythology around it, becomes something that everybody wants a part of.

56:25Cryptocurrencies, another one that has a mythology. You see people getting rich. It has this feeling of being outsiders. But you see, AI is another one. You sit online, people experimenting. You can see what's going on. You can see everybody is starting to talk about it. Doesn't mean you can just buy some share that's exposed to it and you'll be hilariously rich. Doesn't work that way. But you know something really big. When you're trying to acquire knowledge, people watch you and I try to glean knowledge and build their world view. You'll hear that every single person is talking about this and trying to figure out what it means.

57:08The issue is, is AI will build businesses. So we're six months away of a gentick AI and a gentick AI means it's like having five of a website of experts that you can ask any question and it will go when do the task. And by using a number of five experts, you can build an online business. Well, the agent, a AI will do that very, very soon. It will build design the website code register the domain name. Figure out the branding, figure out the marketing, figure out the email list, figure out what the whole thing. So then you and I are in competition now. You've built this incredible new website and it's a new supplements formula thing.

57:52But it's a cool website and you experience kind of 3D whatever it is, right? It's got AI in it. I just go to my AI and say, love Steven's website can you just build it better and make it in Hindi as well. Because I think there's a big market there. What do you think? It'll come back to say not Hindi. I think there's an under saturated market in Indonesia. Three minutes. What? How can we be entrepreneurs in software? So now there's this theory going around that AI is going to eat software. And I can't get it because it can build anything in seconds. So and again, whether it could do it six months or 12 months, it's of that magnitude.

58:35What the hell does that mean? But yes, the 23 year old who's learned guiding in the jungles of Latin America and is building a luxury lodge for people and you know some eco tourism. I don't give a shit about any of this. It's so interesting this idea that we might be at the collapse of the digital opportunity in a sense because when I say the digital opportunity, I'm talking about content creators. I'm talking about entrepreneurs that built, you know, after the dot car mirror, I'm talking about stock traders, you know, people that trading stock markets. And if we're at the collapse of the digital opportunity and that the values all going to recruit to these big sort of tech giants or the AIs.

59:17Imagine if this is the moon in history where actually the best play was to go be build the backpacking company in, I don't know, the Himalayas or whatever. Maybe like that's the opportunity, but it's not scalable. Yes, you can do it and find people will spend more on it to go back to our earlier conversations. People spend a lot of money on it. So it's quality attention because everything in the world is attention. Attention is up stream of everything. So you get the attention of these people in a rain forest. They want to spend money on doing this particular thing. Fantastic. How scalable is it.

59:55Difficult because then there's people management people are not like software, right? So they're not scared, but you can do very well and not be concerned about this other world. How does one invest in AI? Something that I think about a lot because I believe the things you say, I believe many of your predictions are out around the impact that AI is going to have on the world, the economy on all of us. And as someone that's an investor, I want to like take part in that. I want to take part on the upside. So I'm wondering, do I just go by Microsoft stock because they own a bit of chat, GPT, by Meta stock because they own a bit of because they are lambda, by Google stock because they have Gemini and their models.

1:00:32So here's the problem, the financial system. The average person watching this has no chance of making the money. They'll make normal returns, not super normal returns. So Microsoft is whatever it is, two, three trillion dollar company. What could it be worth? No, 10 trillion, 15 trillion. It doesn't really matter. Right. That's a five X. But for the most revolutionary technology, the world has ever seen you make five times your money. That's not, but somebody else in VC or earlier in some way shape or form or the entrepreneur will make all of the money. And this is the thing I don't like about the system as it is.

1:01:14It's kind of rigged against the ordinary person. So we're going to have your jobs replaced, you're going to have a societal change and yet they don't get a chance. So yes, invest in technology. Don't own any other stocks own technology and you will capture some of this. You're investing in your own demise. At least you'll get some high quality returns. But otherwise, the only way I can come up with again and we keep referring to it is crypto. What is crypto? Crypto is just a technology. You know, it's a lot of things to many people. It's just a database that's better than databases in the past.

1:02:01So right now, your database may be in your spreadsheet and let's say you and I have a bet. You write it down there and we get a third person to say, yeah, that was the bet they had and this is what's happened. Okay. That is how databases, that's banks. There's pretty much everything we do in societies in this ledger system. It's called. I've got a suitcase here, which is maybe maybe a good way to kind of explain this. This is a bank.

1:02:36And inside the bank, which is I guess the middleman, you got money. Yeah. So could you explain it to me through the context of this? We'll call it the central bank. How the system currently works as it relates to transactions, the public ledger, etc. So, okay, in the old world, we both had our gold. Yeah. And we'd stick it in our safe or bear it in the ground. That gold was your gold. This was my gold and I might try and fight you for it. That's what pirates did. Okay. And then we invent banks and banks. We put it in there and they give you a note to say Stephen, you've got one of those coins.

1:03:18Raul, you got one of those coins. Okay. So we've both gotten a note now saying that. Yeah. And now we trust this bank to give us our coins when we want them because they're our coins. Okay. That makes sense. Safe is a bank, as people would say. The issue is, is in this world of smoke and mirrors, what's known as fraction reserve banking, they have taken those coins and given somebody else. They've given my coins to someone else. Yeah, they've lent it for money. So now that coin is not in there. But they've been given the money. So usually when you're just, you know, if everybody pulls all the money out, there's not enough money.

1:04:02It's called a bank run. We've seen those recently, but that's a classic thing. So it's not your money because you don't actually own your money. The moment you put it in the bank, what you've become is in fact a debtor to the bank or a credit. It's sorry creditors to the bank. So you've lent them money and you get some legal redress that if you've got less than 100 ,000 euros pounds, whatever the currency is generally that's protected by the government that if the bank goes bust, then you get your money back. But anything beyond that. Yeah, anything. But I've got a piece of paper. Yeah. Means shit.

1:04:42You don't own anything. Now it's so big as a problem that 2000 so that was 2012 European crisis exactly this people didn't own their money. That person walks off where they asked the bank for it. The bank didn't have it. Nobody's got any money where it's all gone. That's the same Ponzi scene we talked about when you've got you buy a house and use the cash register by another house to another house. Right. Somebody takes away what's known as the collateral. Suddenly it's all gone. But the issue was actually bigger because 2008 proved another thing is that nobody owns anything. So the whole system itself is leveraged.

1:05:26So for example, back in that time, the average US government bond, which is the safest thing in the world, was leveraged up to 30 times. What does that mean? That means 30 people thought that that was theirs. Oh, so I say that this is the bank in front of us the suitcase and it had one coin in it. When we put that one coin in it created 30 more coins and gave out 30 pieces of paper. Yeah. So there was actually only one coin in the bank. Yeah. But they made 30 pieces of paper. And that's all well and good. If the collateral, the thing that it secured on the coin maintains value. Or isn't pulled by one person.

1:06:20If you were the lender and your original lender and you get it out. And something happens. Then all of these 29 other people are like, I want my coin back. No, it doesn't exist. It doesn't exist. So we just made it. We just created the coin. Correct. We just gave you a piece of paper, but there was no coin backing it. Yeah. And the issue is, so that's one issue with the banking. The other issue is, is pretty much everything we do is created on this. It's called a ledger system. A ledger was invented in the Renaissance in the 1500s, 1400s, where what would happen is you have this on a, on a accounts or balance sheet.

1:06:59You'd have these dual entry ledgers. And what it's basically saying is, I agree with you. And often we'd have a third party agreeing it. Okay. If she is, is that's known as the Byzantine general's problem? It's actually a philosophical mathematical problem that has been unsolvable until Bitcoin came along. And what it is is, we are generals on the war. You are way away from me. We can't communicate with each other, but I need to send somebody to tell you something. There is no way of making sure that that person tells you exactly what I told them, and no way of you're proving it. And that's what a three party system does.

1:07:39I may go to a notary, but how do you know I haven't bribed the notary to lie? I say that all the time. We see it with accounting firms and audits. We see this in everything. There's always one of these trusted parties that is not trusted. The bank, classical trusted counterparty that suddenly may not be trusted. We saw it with Silicon Valley bank recently in the US. So what blockchain did really cleverly, we said, okay, well, the way of solving this is get thousands, tens of thousands, hundreds of thousands of millions of people to confirm it. Okay, so let's throw away the bank. Take my paper back because that's worth zero.

1:08:22If you pick up this chain here on the floor, this is our hypothetical blockchain. Now explain to me the difference between the bank we just saw and this blockchain. So this blockchain. So this let's say is a Bitcoin. This slot on the blockchain is confirmed by every other part of the blockchain, which is all the computers that solve this mathematical problem. We don't need to worry about that, but what it is is tens of thousands of people reporting on all of the activity. So if I transfer this ownership to you, it will know that you are the owner. You can either hold it yourself like the gold coin as a bearer asset or you can ask somebody to custom it for you, but still your name.

1:09:16So if I want to send you a Bitcoin, how is how a tens of thousands of people or hundreds of thousands of people confirming that that transaction is legitimate without a middleman checking? So they're essentially taking a snapshot of the blockchain and they all have to agree. And then it's called a consensus mechanism. They're not actually at their computer saying yes, I agree. Well, the computers agree. Okay, so the computers are checking. Yeah, or the blockchain itself will say, well, that doesn't agree with all the others and it gets rejected. And that whole block will get rejected until resolved.

1:09:53Like there's a problem here. And that's called consensus. So what you're doing is a multi -party consensus that this is truth. So now what you've created is what a friend of mine calls the security truth machine. So at first, we all know it for Bitcoin. I can own a Bitcoin. It's proven that I own the Bitcoin. I don't need anybody to tell me that I own the Bitcoin because it's publicly -acknowledgable and verifiable. On the blockchain, it's immutable, which means... ...can't be broken. Okay. But this is where it gets really interesting. Is we've suddenly found that after the invention of the smart contract, so right now, let's say we're 2000 and...

1:10:41There's a contract in here. Yes, it says, I've sent one Bitcoin to Raoul. Okay. So this is the world pre -etherium. Okay. The world post -etherium would say, I'm going to send Raoul one Bitcoin if the sun shines 13 days in a row in London and something else happens. Whatever it is. And it'll automatically settle verified on the chain. Because there's 10 ,000 computers. And there's code in that to make the settlement. Okay. So, or well and good. Maybe we'll know what that means yet. What it means is that everything we do as humans is actually contracts. Me turning up here today, a contract. Literally everything we do is a contract.

1:11:31Every ticket you buy, every purchase you make, everything is a contract. How society functions. Money is a contract, isn't it? Money is a contract. Government is a contract. Religion is a contract. Everything is a contract. It's how we create a social construct and social order. Now, what we can start doing is using this very powerful chain and putting other stuff on it. The first random thing that came on it was actually art. Because it's valuable called NFTs, non -fungible tokens. There's single pieces of art that were stored there and we can have ownership. But that's really experimentation.

1:12:11Really, your Taylor Swift concert tickets can be on chain. Why would you do that? Because now, this has solved another big thing that didn't exist. We talked about before in a digital world, everything goes to zero and value. So, Raoul, what's the point of this? This is just like cloud storage. Just goes to zero and cost. No. Because what we've created is digital scarcity. You can only create a certain amount. We can make that one asset, be that one asset. And so, therefore, it can't be replicated at all. So, now in this digital world where every day is more digital than the next, we've created scarcity.

1:12:54And scarcity is what gives value. It's what humans assign value to. And that means that... That scarcity of knowledge means that knowledge was valuable. Lawyers. Because not that many people come out of law school that then, now with AI, not valuable. So, to make sure I, I and everyone listening understands what the blockchain is. It's this public can think of it as this database in the sky. And the database in the sky is checked by everybody who has their computer on and is interacting with the database in the sky. So, you no longer need a government or a bank checking the transactions and the contracts in the database in the sky.

1:13:33Because now all of our computers that are on interacting with it are in the background checking that if I send you one Bitcoin, if I do something on this database in the sky, it is in accordance with the history of the database. And it is in line with that database. Yeah, and to make it less complicated, it just makes it a source of truth. Okay. In a world where we don't even know who is who online, who owes each other what. Any of these things, we now have a source of truth that everybody can agree on. And everyone can see. And everybody can see. And you don't need to trust anybody. And so, that as a technology, solves many things, problems that we don't even know we've got because they're so part of how we exist.

1:14:29So, the technology is not about money. The technology is about truth and exchanging value and creating value in a digital age. Now, what is interesting and powerful about this technology? Is we've seen technology similar before the internet. We've seen broadband. We've seen these big global infrastructure things. Most of those, the internet was a public service good. Broadband was all built private sector. We didn't get to make money out of these things. Really, Amazon made the money or whoever it was building the broadband, they all went bust as well. What we've got here is this very clever thing that everybody in this blockchain gets rewarded for the role that they play.

1:15:32In maintaining the blockchain. And because these things are scarce and let's say Bitcoin being the most classic example, there's only 21 million that will ever exist. You've created the scarce asset that is a reward system. So, the people who mine the Bitcoin, they use the electricity to solve the algorithm to get the bitcoins to make sure there's only 21 million or they get rewarded. The people who verify the chain get rewarded. And then we can buy the asset which is actually us investing in the future use cases of this thing. Are people going to use it for storing wealth or building stuff? So now you get this global infrastructure layer of which people can invest.

1:16:20Now, let's go back to the example of AI.

1:16:26AI, 99 % of people listening to this will not be able to invest in it apart from buying some of those big public companies. Because they're not accredited investors, they're not allowed, they're not going to see it, it's an insider, all of this stuff. This is the inverse. It is fractionalizable. So, a Bitcoin, you have to buy one at 60 whatever thousands, but it is today, you can buy a fraction. So, remember we talked about property and the guys who own the big high end property make all the money. None of us can buy the $50 million apartment in Manhattan and then do it up and flip it for $250 million.

1:17:07Now, blockchain, we can all put 10 % of our paycheck in it. Do you think people should? Yeah, and more. But the point being, is this is the only globally homogenous asset on earth. It's the same in Nigeria as it is in Brazil, as it is in London, as it is in Silicon Valley, as it is in India, as it is in Papua New Guinea. And everybody is on equal footing. You can put the same percentage of your worth in it. Okay, that is mind -blowing. And it bypasses the banking system, the brokerage system, and all the other incumbent things that get in the way of a Nigerian buying an international investment.

1:17:59So, we've got a playing field that's leveled in the fastest -growing technology of all time, in the fastest -approaching asset in price terms of all time, in the shortest period of time, that is globally available to anybody. And then you realize, holy shit, okay, this is important. Now, why that's important is because having more investors in it means the asset becomes more valuable. Which means you're more likely to secure it. People want to join the network to earn some of these tokens, to secure it. The more use cases get built upon it because people are making money, and it bootstraps its behavioral economics.

1:18:41It's an incentive -based system to bootstrap the most ridiculous startup idea of all time, which is I'm going to entirely disrupt money and create a new internet. I mean, that's laughably stupid, and that's what's happening. One of the, I run a company called Third Web, which is a Web 3 infrastructure business. We've raised quite a lot of money for the company, about $30 million now, and we have a big team, and it's interesting for me to observe the use cases, because people come to Third Web to build on the blockchain. And one of the really interesting use cases we've seen over the last, I'd say 12 months, that's really exploded, is gaming.

1:19:18People building Web 3 blockchain -based games, because if you think about games like FIFA, which is a huge game obviously in the UK, where we're big soccer fans, or other games like, you know, Runescape back in the day, where you have assets in the game, in FIFA you have a messy card, in Runescape you might have a sword. The thing that the blockchain now enables us to do is to take those assets from the game and actually trade them outside the game. So I can, if the sword was on the Ethereum blockchain, even though I'm not inside the game, I can trade that sword on the Ethereum blockchain. And so one of the most exceptional use cases we've seen at Third Web is people building AI games.

1:19:58Sorry, people building Web 3 games, because these assets are now valuable. It's great for the game developer. They've now got this brand new economy for their company, and it's great for the people that own those assets in the game, because they've now those assets are now more valuable, because more people can access them. And I don't think people realize the extent to which this disruption is already taking place. People think of crypto and Web 3, and they think of buying coins and hoping the price goes up. But it was interesting. Everyone knows like DocuSign and Adobe, like eSign and those things.

1:20:27And I went on one of their websites, I think it was DocuSign, because I thought surely physical contracts should be on the Ethereum blockchain now. And there was this little paragraph on the DocuSign website, which says every time like a contract is signed on DocuSign, we do, like there's a hash on the blockchain. So it's like recorded on the blockchain. I thought people don't even know that the blockchain is now penetrated. So I've got an asset management company, exponential age, asset management, we invest in hedge funds that just invest in crypto to capture this trend of going from $2 trillion, where it is today in value.

1:21:01I think it's going to $100 trillion in, let's say, 2032, 2034. Okay, that's stupid. That's more wealth than has ever been created in that period of time on Earth. But it's twice the amount of value of the S &P 500, the entire US stock market took to build in 100 years. I think we'll do it in 20. So this is staggering that wealth, which is why we'll talk about why people should be involved in how they should be involved later, because I'm passionate about that. But I was one of our investors, I was in Switzerland, and she is the head of trading at one of the soft commodity companies. So soft commodities like Coco, sugar, corn, all of this stuff, agricultural commodities.

1:21:50And I'm like surely you guys should be thinking about building on blockchain, because there's a lot of letters of credit and stuff that happened shipments. She goes, a wheel, all the commodity trading houses built on Ethereum in 2020. She goes, so every shipment we make, the shipping contract, the quality of goods contract, the letters of credit, everything is on chain. So we don't have to trust these others, because commodity engines are full of sharks and you're dealing with countries that are not easy to deal with. So we've got this verifiable source of truth, it's completely revolutionized our industry, and nobody knows about it.

1:22:37And if I own Ethereum, if I own an Ethereum token, which I do by the way, I've been stacking it and refusing to sell, good. Much to my brother's dismay, who's like, Steve, you're a bit too emotional about this stuff, and I say, bro, I say, if there's any asset that I own that I... Well, we're going to talk about how not to fuck it up later, but how do I benefit from the fact that games are now being built Ethereum? It's really simple. If we'd have all been given shares on Facebook when it started, we'd have all been hilariously rich. But we didn't. The VC's got it, and then it went to the public market, and then you have to have a brokerage account, you have to be approved.

1:23:15Right? What this is happening, you buy an Ethereum token today, if Ethereum ends up becoming bigger and more uses, your token value goes up. It's as simple as that. So you get to participate in an entire technological revolution, really simply from your mobile phone. And you don't need anybody to approve it or do anything. Yes, there's regulations stuff, but simple stuff like that. It's pretty straightforward for almost everybody in the world. So therefore, we talked about how do you invest in your disruption and the future of technology? Okay, here's one where you can really do it, and it's easy to do.

1:23:59I thought the question's here then. So you said it's easy to do. Yeah, let's talk with the practicalities. How do does one do it? I can do it on my phone. I have to call someone. How do I invest in crypto? You just open a crypto account. Yeah. With one of the big crypto providers Coinbase, Kraken, crypto .com, who are in the Gemini? What about this, though? My bank, my digital bank is offering me to buy crypto on there. Should I do that? Yes, you can. And you could do it by PayPal. Start somewhere. I'm not going to say no. But you will go down the journey that everybody goes down, which is the easiest on ramp is the best.

1:24:38Revolut, whatever, I don't care. Just do it. Get a feel for what it's like to own an asset that goes up and down a lot, particularly down when it goes down. It makes you feel terrible. And you got to learn about how to deal with it. And then because it goes up over time, if you don't do anything and you've chosen a good quality asset that's provable as an asset in itself, it'll probably go up over time. In fact, highly likely to go up a lot. And then you'll start thinking, do you remember Ralph saying that the bank owns the stuff on I don't own it? And then he might say, oh, but the magic here is unlike the bank where I can't take more than 10 grand out, I can put it all on my little ledger device because...

1:25:25What's the ledger device? It's a company that provides it, but what it is because this is just an address on a blockchain. And think of it as like your mailbox. You can send stuff to it, but you can't actually take it out. Let your email somebody can't read all your emails, but they can send you emails. Well, that part that's private, that secure pass key essentially. Well, you keep that to yourself and it's stored on a device and there's a complicated way of doing it. And you'll have to go through that, which is you have to have this seed phrase that does it. This technology will change quite soon, you know, fingerprints, face prints and a bunch of other stuff.

1:26:14But basically a little USB stick will secure that you can go and put the save or go and take it to your nands house or whatever it is. Can secure your money that it's only yours and nobody can take it out. I have mine on a ledger, so I have my Ethereum on a small, it's kind of like a small USB stick. And then that USB stick is protected by like 24 words or whatever it is. And those words are on pieces of paper in different countries at the moment. And it means that no matter what happens, no matter where I am in the world, no matter who comes for me, I can always retrieve the X ,000 Ethereum that I have on this ledger device.

1:26:55Yeah. And like a bank where my account could get frozen by the government or they could empty my bank, they could freeze my bank. I can always have that value. And also, you know, there's a famous example of the compensation of gold in the United States. And it's been done in many countries in the past. The good thing about this magic internet money is you have to physically cross borders with it. Yeah. Think of all the Jewish people who had to take money and diamonds and gold out of Nazi Germany and out of Europe. But it was hard to do here. You have to do anything. You just need to remember a seed phrase.

1:27:36A seed phrase being basically a string of words. Yeah. Yeah. So which blockchain, which coin do you think people should invest in? I have only ever invested in one. I've only ever backed Ethereum. And I think part of my bias there comes from the fact that when we're building third web, I had a window into the blockchains that people were actually building their applications on. And Ethereum was the was the one. And obviously there's layer twos which are people then, you know, build blockchains on top of Ethereum, etc. But for me, Ethereum was just the dominant blockchain that I thought would solve for most of the use cases outside of maybe what they call a store of value outside of like money necessarily.

1:28:17So contracts and other things. So do you see this is where my, this is my 30 years of expertise is this one thing, which is that allocation. So firstly, the average person watching this is you need to allocate to this end of story. If you're going to start somewhere, start with Bitcoin. It's just easy to do. It's widely available, you know, through different, you know, whether you should credit card anything. Just do that. I don't care. Do that. And do it with as much money as you can afford to see go down 60, 70 % and don't care. And expect that to happen because that's what you have to see to see the long term 150 % a year.

1:29:09It's included within that is these downsides. Then I want you to put into money every month regardless of price to build your savings. In this exponential asset that goes up a lot. Okay, now you set you're on the journey. And then you want to figure out how do I make the most money like you I switched. I Bitcoin to start with I switch all of my Bitcoin into eith in 2020 in Ethereum. And so I was I just owned that plus some NFTs and a few other bits and pieces, but generally it was that. And then in 2020. Two of the bottom of the bear market I started to see the price of Solana. Seeing like it wanted to outform Ethereum.

1:30:01Now Solana much like your thesis. I saw this massive developer community. Passionate retail and a difference in the technology because these are all basically distributed companies that sell block space. So you want to look for attractive block space Bitcoin. It's the secure one Ethereum. It's like the world computer. Yeah, and everybody's building on top of it Solana. Faster cheaper. Feels more friendly efficient. Yeah, it feels more retail. And I saw that. And the speed of which they can do things and the innovation and the developer community. And then I started switching and then switch all of my eith outside of my NFTs where I collect a lot of art into Solana.

1:30:53And I've now been switching part of my Solana into sweet SUV. And as a disclaimer, I'm actually on the board of the foundation, but it's like the next big chosen one. It's the group that came out of Facebook, the built Facebook Libra. So what I'm trying to do is maximize my return. I'm a mercenary around I'm passionate about this space and what it means, the technology. And how it empowers people how it can change the third world how it can change the internet. But I'm also a mercenary from my own capital and for anybody else, I can help. Now, does me not always get it right? So in your particular circumstance, I would like look, you'll probably be fine over time, but you're not maximizing your returns.

1:31:37But do you want to take the risk? Do you have the bandwidth to do that? And these are the questions we were talking about with work. It's the same thing. How much do you want to go down the rabbit hole? How much time do you have to invest versus the expected upside? I don't have a time. I'm spending all my time doing podcasting, building businesses. And then just do it. You're doing unless something says that Ethereum usage is falling off a cliff and developers are leaving in time. Then don't worry about it, right? You're going to be directionally very right. Will you capture the best returns?

1:32:09No, normal eye. Some other brand, though, will get by luck. Something right. But the average person. So I have this thesis that I've tried to help as many people with. This is from my own learnings and watching everybody else fucking out. Is what happens is you're given this incredible asset class. And at first you do intelligent thing like own some bit called the semif. And then you want to go out the risk curve because you see somebody else making more money. You understand you can. That's okay. And then the bull market really hits the bananas own period when things go bananas prices go vertical.

1:32:45And you will see people online saying, well, I made a million dollars today because I bought this mean coin. And you will lose your mind. And you will start buying all the stupid shit and you'll go so far out the risk curve. And then when the music stops. The stuff you won't be worth nothing. And the more quality tokens will retain their value. The other thing that people do in that journey is use leverage. What is leverage? Leverage is when you borrow more money to buy more of the asset. So I now borrow money to buy more Ethereum because I want to outperform you and I want to make more money.

1:33:23Because I'm really greedy. The 160 % a year that Ethereum does as returns since 2015 is not going to for me. I want to make it 400, 500 % a year. Stupid. And what happens is you borrow money to do it. It's leverage. Futures markets, perpetuals. There's a whole bunch of ways of doing this or even borrow your bloody credit card. Whatever way people will do this. And you really have to know what you're doing. Because the whole game, if this technology is going to last over time and it's going from two trillion to a hundred trillion, you have one job not to lose your tokens. One job. You can do nothing like you're doing and you will make an extremely good amount of money out of it.

1:34:11Your one job is to not fuck that up. I have a bit of a theory. And this theory is very naive and narrow and based on the smallest sample group in the world. It is I have six friends. I actually am one of the six. I have five friends, five of my best friends. And we've all taken different attitudes towards crypto. And my friend who is most heavily involved in crypto has made the least money and is arguably the least rich. And it's his life. And I think it's because of what you've described. Whereas my position has always been I invest in this one coin. I don't sell it and I just buy more when I can over the last six years.

1:34:50I don't really pay attention. Frankly, if you ask me to log in to see the last time I checked what it was worth, I couldn't tell you. Couldn't tell you what it was worth. Actually, I struggled to log in. It's been so long since I've logged in and looked at it. And I think my returns have outpaced his because of that. Yeah. I think that's right. And so, you know, this is all the conversation we've been having. The secular trend. The opportunity. The skill set. Then it's the execution of that thing. Then it's not to fuck it up. And what you've done is not fuck it up. You invested in your seed phrases elsewhere.

1:35:25So no, we can you've got no single point of failure. You've got it stored privately yourself. You have it in a large one of the top two. There's probably three that are low risk in terms of the chances that the use gets abandoned in the next five years. Bitcoin, Ethan, Salana. They're pretty safe. So everyone should knock their socks off 80 % of their portfolio. Do that. And you'll make money. 90 % of portfolio. Don't use leverage. Then we're all humans. Give yourself 10 % and do the fuck what you want. Most of the time you'll find out that that 10 % goes to zero, which is fine. It's a good lesson.

1:36:06You don't care because you've made plenty of money on the rest. But if you are that genius who can find the thousand next mean coin, knock your socks off. Here's why I think that genius ends up because it's funny because the friend I'm describing. He's around. He's in Dubai. So there's a lot of them out there that you said you're understanding what I'm talking about. Yeah. They all invested in Luna. They lost the fucking shirt. That he was telling me about his boy who he works with who made, I don't know, tens of millions betting on these mean coins. And then now he tells me that exact same guy is broke and is in a lot of trouble because the mentality that makes you go and pursue it with these real high risk bets, these are like mean coins and stuff.

1:36:46It's also the same mentality and mindset that makes you lose the thousand X return, the ten million dollars you made. On the other side. And I think the psychology of money book talks about that as well. Like case studies Morgan House's book case studies the guy who like bet against the like the contrarian that made the billion is also the same contrarian that ends up losing it again in the next cycle. So I feel like I've seen that a lot. The problem with the mean coin thing, it is a casino. Yeah. What is good is there appear to time where where everybody in the casino makes money. Yeah. Right, which is unlike a scene, because there's trends in financial markets and on taking out paper returns.

1:37:27And then a lot of this stuff goes to zero. We saw that with NFTs last cycle. We've seen it with a whole bunch of tokens, which is what you need to be very careful of latching on to a token and just keeping hold of it because some of these won't survive. You're lucky or in E for not in something else, EOS that was around in 2017. Right. It's like you're stuck. So you need to be careful. Speculation does work for periods of time. It's better than actually lottery tickets and generally better than the casino, but only for periods of time. And then you will lose everything. So I'm just going to come into that casino and sweep every table and only 5 % of the people going to be left with money.

1:38:08So just think of it that way. So if you want to have fun, people, but the people who do it the most, the people who live off adrenaline. Yeah. Right. It's the adrenaline junkies. They're usually terminally online. They probably like to gamble in other ways sports betting. It's, you know, it's an, I'm not really that person. So I don't trade. Yes, I own a few mean coins because I enjoy the fun of the culture and seeing that culture develop. But just keep it simple, stupid. Is this why men are so drawn to this? I was thinking about the gambling statistics and like, it's like something like 95 or 98 % of gambling addicts and men.

1:38:49And I was thinking, you know, how does this overlap with like their sense of purpose and community? Much a deeper question. I think men feel hugely under pressure to be successful. To provide. There's a societal thing about what a man does and what he should do and how you measure success.

1:39:13That even in sports, it's kind of, it's very competitive to be a man. But it's also somewhat of a lonely pursuit in that respect, because men aren't very good at talking about their feelings and their fears and all the bullshit you bring in your head. So some gambling. Is to do with that desperate need to get ahead. I need to make this work. But then it becomes somewhat of an addiction because of the adrenaline. Dopamine is a very, very powerful drug and we search for it all day, which is what the internet's all about. It's the behavioral economics. This is what they discovered is you trigger dopamine and you can make all animals do something.

1:39:52Famously skinner and the rats, but humans and the internet and like buttons and anger and all of these things. So there's part of that. It's partly also. Male society is about. Betting improving your prowess. Gladitorial. So it's a whole complicated thing of what makes men do it. But the reason for example in crypto, it's so male. It because we're driven by that need to be the breadwinner, even though societies moved on from that. And we're seeing fantastically a rise of women in the blockchain space. And a changing of that crypto bro culture that was there. If you follow some of the crypto Bitcoin Twitter pages that other confession pages, but people can write it in confess what happened to them.

1:40:50It's often really sad and heartbreaking hearing about this father who has three young kids under the age of seven, who invested in some meme coin, lost it all. And now his wife wants to know where the money is and he's got nothing to show for it. And I've seen these documentaries. I've even kind of heard of these stories in in my extended network where like my personal trainer put 6000 pounds of his very scarce money into some coin and it went to zero. And he's lost it all in it. The suicides in the in the bear market when people have put too much in and they've lost it all much of the reason why I think people don't invest in crypto anymore is either they've heard one of these stories or they are one of those stories.

1:41:27And I think there's a kind of a disclaimer and kind of a warning here which needs to be this is that don't fuck this up thesis by Bitcoin Ethereum and slarner one of those three preferably all three. And that will stop you going to zero. But it will go up it will crack could crash 70 % or something. Okay, so that's a conversation about time horizon. How long should I be prepared to hold it for to make a return? What depends what return and for what remember we talked about you know what part of your destiny trying to manifest here which part of your lifestyle chips you trying to cash in. So if you're trying to get rich quick I want to make loads of money by next year.

1:42:12I'd rather you didn't do this. I don't think that is a sensible intelligent way of living your life you're going to take too much risk and you're going to substantial to lose it all. If you said hey, Row listen what I want is I want in five years time to have made a decent return on my money you know three four five times on money. I'm like yeah that's fine. Okay, I'm going to ask you for a price prediction. No, you don't you don't do price predictions. Not anymore and the reason being is because a lot of people listen to what I say. And therefore they then build a mental model around a price.

1:42:55And what you do is then you create a false comfort in what you're doing but RALS as it's going to X. And that stops you doing the work to make yourself test anything. And then you start extrapolating well I put ten grand in and if RALS write I'm going to have a million dollars like the whole thing becomes this emotional journey. And so I've tried to stop doing it because the best thing I can say to people is listen 2032 2034 that is not long away 10 years. This asset class is going to go from two trillion to a hundred trillion. Right that is a huge return. Now some of the coins in that space will do a multiple of that that simple thesis is why I built X -PAM the asset management company exponential age was just to capture this trend to let well unfortunately it's only for high net worth investors and institutional investors but just let them go on that journey get the hedge funds to take the risk and figure it out and do that.

1:44:04But if people just do that give me 10 years just give me 10 years and if you do it 10 years in your sensible you'll be able to take a whole chunk of money out every few years because it's quite cyclical it moves maybe every four years and so you can take a chunk out cash cash in the lifestyle bank and keep moving towards that goal. Well as you are speaking I figured out your price prediction based on your prediction of how big the asset class will get. So you give me enough time to ask AI to do the math for me and it says if Bitcoin has a 40 % market dominance the market cap Bitcoin will be roughly 40 trillion there are approximately 90 million bitcoins mine the price would be around 2 .1 million per Bitcoin.

1:44:51And a 50 % dominance the price per Bitcoin would be 2 .6 million per Bitcoin today as we sit here the price of Bitcoin is $62 ,000. So if your prediction at the asset class gets to 100 trillion and if Ethereum is 15 % of that then each Ethereum will be worth 125 ,000 per Ethereum and today it's worth about 200. Okay so then what I do when I face with something like this when I first bought Bitcoin in a first wrote I wrote the first ever Bitcoin strategy piece and made a price prediction based on what I understood about Bitcoin back in 2013 12. It was the first ever piece written by anybody and I said listen I think it's worth a million dollars and it was pretty at $200.

1:45:39And I had some basic math but same kind of idea using trends and everything else and I said I'm assuming I'm wrong by 90 % still worth a hundred grand and it's currently $200. It's the best trade you'll ever do in your entire life and that proved to add to be true. So let's assume that Rally is more and I'm 50 % wrong as a 50 trillion dollar asset class you get to a million dollar Bitcoin. Yes right. And assuming whether it's that dominant or less dominant and what happens to it but you can see the magnitude of the returns. So that's what 15x return in Bitcoin. What if you're wrong? You've staked so much of your life on this you've invested so much of your own money in it.

1:46:26What if you're wrong about this asset class? You couldn't have predicted Bitcoin would be so dominant 20 years ago. We can have predicted even five years ago that AI would take hold. These things come out of nowhere and they change the paradigm. What if you're wrong? I'm an investor so being wrong is part of the thing. What's hard is by helping so many people at Real Vision and elsewhere. It is a weight I carry on my shoulders because I'm trying to bring as many people across the line and unfuck their future. And all of these things. And I asked myself those questions and I go back to the simple thing.

1:47:04There was the graph of the adoption of this. That's going to stop. We've got an issue. But then how are we going to solve problems of digital identity or contracts in a globalized world or any of these things without this technology. I can't do it. It's like a magic technology. The Byzantine general's problem was a real complicated problem that nobody had solved until Bitcoin. Maybe AI creates a better blockchain. Maybe AI creates a better system. Yes, it could do. But how long away is that before we adopt it, it adopts that technology. Some quantum cryptographic, whatever. Is there a need for it yet?

1:47:54Why are we disrupting a new industry that's not been disrupted? But yes, no investment comes with that risk. Crypto comes with that risk. The risk that governments will try and shut it down even though they've tried. And it's like a cockroach because it's distributed and it's everywhere. Yeah, there's the risk. The blockchain you invest in becomes less valuable. There is the cyclicality of this asset that can fall 70 % 80 % every three every four years. You have to deal with that. There's the risk that you lose your coins. There's all the risks in the world. And that's why you get paid the return.

1:48:35So I don't there was no certainty in this world. I live in a probabilistic world. But if you can show me the world is going to be less digital than today. And you can show me a better way of dealing with a lot of these structural problems that we have. And you can show me that the community, the groundswell of individuals. Don't forget, this is driven by individuals. We've front run the institutions. The institutions weren't allowed to invest in it. But we've been able to put our money in before they did. We've created it. If I see any of those factors changing, then I worry about it. So you telling me that if I'm earning an income right now, I shouldn't hold these pieces of paper that the central bank, my bank is giving me.

1:49:20I shouldn't keep cash in my bank account. Everybody has different needs. I'm not saying don't have way to inhabit. Look, everything up to about a hundred grand is protected. So you're okay. You're not going to lose your money that way. But you're losing another way. And that's the devacement of currency. It's time to take a moment to reflect on our sponsor, WOOPS, Stobroctober Challenge. I know thousands of you got involved in the Stobroctober Challenge. My inbox has been flooded with messages sharing the changes you've experienced, which is amazing. A big part of why I partner with brands like WOOPS is because I believe they offer something of incredible value that I use in my own life.

1:50:00Something that's made a transformative, transformative impact on my life. And it's frankly much of the reason why I quit drinking alcohol. Challenges like these aren't just about getting you to stop drinking forever. They're about getting you the tools to have more agents here over your life and to make better informed decisions with all of the information at hand. Hearing that so many of you got involved in this challenge is absolutely incredible. If you didn't take part in the challenge, but you still want to learn more about WOOPS, all you've got to do is head to join .woop .com slash CEO and start your free trial today.

1:50:29I have a hunch that you won't regret it. So what's the debatement of currency? Really simply, we talked about in a digital world, everything goes to zero in value.

1:50:44That is debatement. What it means is too much of something makes it less valuable. I can come out of the desert. I will pay anything for a bottle of water. Give me a million bottles of water. I'll pay nothing for them. There's too much of it. Now how can there be too much money? Q1 is often when businesses start implementing new systems and processes in hopes of creating efficiencies for the year ahead. And over the course of my career, I've learnt just how crucial having the right systems in places, one which has helped me across many of my investments is NetSuite. They're also a sponsor of this podcast.

1:51:23NetSuite is the number one cloud financial system through their streamlined platform. You'll find all of your accounting financial management inventory and HR in one place. Their technology has been a real game changer, especially for my team at Flight Studio. As over the last year, we've moved out of startup mode and into scale at mode. We no longer have to juggle multiple systems and having everything together has reduced the number of manual tasks and arrows. Over 41 ,000 businesses have chosen to future proof their business with NetSuite. So if you'd like to learn how it can help your business, head to NetSuite .com slash Bartlett.

1:51:57And free download the CFO's guide to AI and machine learning. That's NetSuite .com slash Bartlett. But what happens is the economic system re -values things in this weird world, in this weird way by debatement. So debatement in the old times was if we take one of those gold coins, debatement was, that was let's say one ounce of gold. Then I was the Roman Emperor. I would just snip off a little bit of the gold. You wouldn't notice and you'd still value it. Try and pretend it was the one ounce. But somebody else would say, no, it's actually worth less. I've taken that slither as the Emperor and I've used it and spent it on sports cars.

1:52:50And you've now got a less valuable coin. And the country has less value. So the money is less valuable. It's called debatement. The more of it that surrounds in an electronic age where you just press the button and you create money. Then what happens is the value of money goes down. So let's say people can understand it simply as, let's say you go on holiday and you go to a country that has a very weak currency. Let's say it used to be Mexico, let's say. You're an American, you went to Mexico. Everything was cheap because the currency kept going down. But for Mexicans, it actually got expensive because the value, the purchasing power of your currency.

1:53:37Pesso went down and you couldn't buy as much with your peso. What we're doing is ever since 2008, the whole world, all the big economies in the world, hit 100 % all the governments hit 100 % of GDP in debt. So 100 % of the economic value of that country was in debt. And that means that just paying the interest of that debt starts to become a burden. So let's say your economy is growing at 2 % a year. Let's say your interest rate was 2%. Well, 100 % of the economic growth basically goes to pay the interest payments. Because somebody in the sugary the money to pay them. But at the time corporations were over 100 % of GDP in debt and so were households in 2008.

1:54:32Everybody was in a debt orgy. The financial system was just lending everybody. And then it all fell apart. And so what they stopped doing was really corporations and households stopped borrowing as much money. They in fact restricted money to us. So in these economic times we've actually been able to borrow less money. Well house prices have gone up by debatement. I'll show you that in a sec. And the governments have taken on this obligation. So they've been massively growing their debts. And they reset interest rates to zero to kind of give them a chance of paying debts back in 2008. And only recently have they have they really risen.

1:55:15But they've still got all of these interest payments to pay for now. The US economy is. 400 and well, 380 % of GDP in debt. I'm it staggering considering the size of this economy. The world. The entire world is 400 % of GDP in debt. But we've gone so far beyond. What is sensible anymore that it's becoming incredibly fragile. So the management of the payments of the debt and the debt itself. Is the number one focus of the government and the central banks. Because if it all goes to shit, it all goes to shit. Everyone's going to lose their savings. Every business goes under. Every government goes under.

1:56:01There's no payment of services. The retirees lose everything. It is unfathomable. And I know many people online talk about, yeah, we should just let it all go. They have no comprehension of what that will do in a world that's 400 % of debt. It's basically a 75 % wipe out of every single asset. And all the retirees and all your savings and all your pensions and everything. So the answer is, well, let's just print some more money to pay the bills. That's you taking a credit card to pay off your credit card payments. Now, when you control the money, you can kind of do that because nobody's going to tap on the shoulder.

1:56:43So what they do is they start printing money. The first they used to use the balance sheet which meant that the Federal Reserve or the Bank of England or whoever would buy bonds from the market and kind of basically take them off the market. So it meant there was less debt around in the market. But they've changed the thing. They now have something more penacious called liquidity. You can't see it. They've got different mechanisms that they put this into the system. And basically everybody, all of the central banks are doing it at the same time. And they're also all in agreement that they have to do it.

1:57:17And this is all driven by that aging demographics and the debt problems that it all caused. And so what we've got is every government having every four years or so to print a lot of money. Why four years? Because in 2008 they all reset their interest rates to zero. They then went and borrow money three to five years out. And every four years the cycle comes up and they start injecting money liquidity. Okay, so what does this all mean? People watching this, like, yeah, I kind of know what you're talking about. What it means is that on average your money goes down in purchasing power versus scarce assets by eight percent a year.

1:58:04And then you've usually got let's say a three percent inflation rate. You've got 11 % of your money is being devalued every year. Your future self is getting poorer by 11%. Right. Remember we talked about the future self. And if you buy the S &P 500, what was it making about 11 % a year? So if you buy the S &P 500, your future self is not going to get any richer for the risk you've taken locking up your money for 10 years or 20 years. Because of this inflation, because of this debatement. Debatement. Now people confuse inflation and debatement. I would call this debatement of currency. And so this is happening eight percent a year, which is why we're all feeling so fucked.

1:58:45It's happening. All these assets keep going up real estate keeps going up to offset this. Now what I did once I realized this, something I call the everything code is a big thesis around how this all happened and what it all means and what's happening is basically the aging population is driving debt to GDP is driving the government debt. And then the liquidity is paying the interest payment. So it's this economic machine that the world has become. It's perfectly cyclical. It's perfectly predictable. It's not going away until we have this technological revolution we talked about. And so everybody has to protect themselves.

1:59:26So once I found this thing called the everything code. I started thinking, okay, if this. Let's say 11 % rates, the hurdle rates of money that my future self is getting poorer every year by what do I invest in? So I started dividing everything by that. And there's some people I've wondered doesn't make you any money real estate doesn't really make you any money gold actually lost your money supposed to maintain your purchasing power. I'm like holy shit. There were only two assets in the world that outperformed this technology crypto. The NASDAQ was 18 % a year and crypto was doing 150 plus you know, Salana's done 250 % a year even with 380 % drawdowns.

2:00:14So this is what got me to change my entire investing game from being a broad based investor with you know a balanced portfolio. To okay, there's only two bets in the world. The literally two bets in the world technology and crypto. And the NASDAQ is down 99 .97 % versus Bitcoin since 2012. How much of your personal money do you invest in crypto 100 % of my liquid network and it has been. Five years. Have you done well? Yeah. Yeah, very well. I've I've not made any major mistakes. I mean, I've been in this journey since 2013. So I have made mistakes. My mistake was I bought it 200. I put not bad size betting considering how unproven it was in 2013.

2:01:05It was how unproven it was and it went up. It went up. Five X or something in the first three months of me buying it. I'm like, I'm the best investor in the world. This is amazing. Then it felt 87 % and I'm like, I had this long term view. It was going to 100 ,000 and that I would just not look at the price. I sure do anyway. And fine. And then 2017. It was now two and a half thousand. I was up like 10 12 X, which was amazing. I've never had a bet up 10 or 12 X and and there was some weird stuff going on. There was another Bitcoin. It's going to be the code have been forked and I was like, I don't really understand this.

2:01:51I'm going to take my money. So that was about March 8, 2017. By December, it had at 20 ,000. It had gone up another 10 X that year. Then it collapsed down 85 % and then I bought it in 2020 during the pandemic into that big sell for it felt 50%. So I bought it cheap. I sold it on the way out. I then bought it when it sold off. If I had just held on to my original bet, I'd have made five times as much money. And if I had listened to myself, which is every four years when you have these big selloffs, you just try and add as much money as possible. I'd have made 25 times as much money. So I've even though I got it right, I fucked it up too.

2:02:44Well, you said that the best trade is always quality of life. Yes. If your account is full of quality of life and quality of life experiences, that's the greatest trade on earth. And I'll continue to do that trade until the day that I die. What do you mean? What is the purpose of life? Now, we can get very existential about stuff and you actually go down these paths a lot with AI and universal consciousness and a lot of other stuff. But basically, let's just assume we're humans. This is assumed maybe we've got one shot on this earth. Whether your might as well make the best of it. And people have got to remember money is just a scoring system that allows you privileges.

2:03:36And people lose track of that and think money is the privilege itself. The privilege is freedom. The privilege is going to live where you want to live. The privilege is being surrounded by the people going to be surrounded by. The privilege is going to bring up a family. Whatever your value system is, those are the things. So, for me, it's a light living in nature. And that's probably key thing number one, but being connected. So when I bought a house in Spain, that was a huge quality of life thing because I've got a security of a house that I own in nature in good climate. I'm fine. But really, experiences are even more powerful.

2:04:28If there is a true currency in the world, it's experiences. As I said, I've just come back from living in the remote world of Zambia. That doesn't experience it is incredibly valuable to me. I've done a lot of these. That is what it's all for. This understanding and seeing of how the world is and the beauty and the marvel, the people, understanding people and not being fearful of people. And not thinking about cultures except in terms of, oh, that's their culture. That's their culture. I suppose culture good culture bad friends. All of these things, these are the valuable things. You can't buy any of them.

2:05:08You have to physically go and spend the time and be uncomfortable. I've always said there is your comfort zone and where the magic happens. And these two Vendigrams don't intersect. You have to be outside your comfort zone to feel the magic. If not, you're just doing life by numbers. Do I need money to have those experiences? No. So what's the point? And me doing all this, you know, Bitcoin investing, focusing and sacrificing my 20s. You need some money. You don't. You can solve for it without. But it's hard if you're living in Ohio or Birmingham or wherever you are, right? You need to get some of these things.

2:05:52It might be, I want to be warm and dry. I want to, you know, grow my own fruit and vegetable. Whatever it is doesn't matter, right? You can solve it by a number of different ways. But really, for the average person, I say this is like, if you want to live on a beach, you can either become a billionaire and live in some parts. Or you can go to Latin America and live on the beach for virtually nothing. And if you're living in an internet age, you can make it happen. But then what happens is maybe you want some more creature comforts. Maybe you do this. Look, I don't say that we should all be the Buddhist Zen Master and say we need nothing.

2:06:32We can reject everything. But if we break it down to what is the feeling that I want, then you can solve it with money without money and you won't be disappointed. Because remember, the very beginning of our conversation is what makes people unhappy is when their vision of their future self and their current state don't meet. Now, if your vision of your future self is, remember I said, I want that peninsula in Spain where that family. So what are the component parts that are like sea, like social life of people, like natural beauty, and with somebody I love, okay, that can be solved a hundred different ways.

2:07:15But in your life, did you have to shift from the building zone, the building season of life to then the kind of enjoyment season of life? I did in the middle, which was the lesson I learned, is I had done the investment banking and the hedge fund thing. I then opted out the right race. I wasn't the richest guy in the world, but I thought, you know what, if I can get a source of income, I can live, I can grow my olives and almonds, and I lived in a beautiful house on the side of a national park near a beach town in Spain. I won the lottery. And I started global macro investor, that ended up becoming a much bigger thing because the financial crisis and I predicted it and got all that stuff right.

2:07:58And so what I found is I'd semi -retired, and I'll surrounded by people who weren't really stimulating, intellectually stimulating. I made great friends, but he wouldn't have a conversation like this. And so I thought, isolated. And then, you know, you live on an adrenaline, if you're an entrepreneur or you're in financial markets, and so you end up going out to bars and nightclub, you know. And I'm like, I looked at it and I've been there 10 years. I'm like, I gotta get out of this because I'm excited by life. I'm excited. I want to do the entrepreneur thing. I love investing. I just want to be around people who also did it.

2:08:37And by chance, I ended up building a house in the Cayman Islands, because it was one of my dreams. I wanted to drop a house on a tropical beach. I love diving, all of this stuff. And that was the signal to me to go, fuck it. I'm moving to Cayman. I started real vision. And I started the entrepreneur's journey and now I've got four companies and I'm busier than I've ever been in my life. I'm very happy doing it, but it's a chapter again. And it'll give me the lifestyle ratchet, but also the intellectual ratchet that I wanted to prove to myself that I can do some of these things. We have a closing tradition on this podcast, where the last guest leaves a question for the next guest, not knowing who they're going to be moving it for.

2:09:15I've never revealed to the last question in terms of who's written it. But I'm going to reveal it in this case. This question is written by Boris Johnson. And the question was, have you ever tried to sack someone and ended the meeting having accidentally promoted them?

2:09:35And Boris is speaking from experience there. You know, I think I probably have. I think I probably have. And that goes back to one of my things that I've had to learn is how to have the difficult conversations. I'm English. And my mum's Dutch. We're all so quite evasive. We don't like drama. My wife's American, so she's told me that, like, this goes straight in for the kill. And I've avoided tough conversations. And so I've probably ended up in that situation. Or something close to it. It's not as perfect as I have as well. Of course I have. And I'm just like, but it's the lesson I'm trying to learn is you need to be more.

2:10:25If it's a tough conversation, just do it. Amen. Thank you, Ron. I think everybody should go and check out your channel, which I've watched for many, many years now. I think it's the, in fact, it's the only channel I go looking for. When I'm looking for advice on anything crypto related, the macro environment, inflation, all of these things, the only channel that I trust and that I go looking for. And I really, really mean this when I say it has always been yours. Because I think you've provided nuance in a way that's incredibly accessible to the average person. And a lot of these financials are very difficult to like understand the terminology, they kind of skip past that part.

2:10:58But what you've done so well is made all of these subjects so accessible for everybody. And I can't imagine how many millions of people you've helped open their eyes to the state of currency debasement. And you know, some of the myths around how to create and save your wealth. And I think that's a mission that is so incredibly important. Because a lot of this insight, unfortunately, historically has been reserved for the elites, however you want to define them, the elites intellectually or the only the people that work in finance. And I think what real vision has done is blown those doors open.

2:11:31And you're, you've been a champion for me in my life. And an educator for me in my life. So that's why I was very excited to speak to you today. So thank you for what you taught me. I appreciate that. And also for everybody watching this, look, I'm genuine in trying to help with my people. And so we've, this whole, everything code thesis to make people understand it more. We've made a whole special air for you guys and real vision. Go to real vision .com forward slash diary. And there is all for for you guys watching this. It's the everything code, the documents, so you can read it, watch the video.

2:12:07You get free real vision subscription because it's free to join. And honestly, there's so many tools. And if you don't understand something, ask the AI. The bottom right of the screen is a little plus button. You ask the AI, the real vision bottom, explain it to you. Everything you need is there. It's free. There's no reason not to unfuck your own future. I'll link that below so everyone's got it. That's real vision .com slash diary. There'll be a link below in the description wherever you're listening to this. Thank you. Thank you. Thank you. I really enjoyed it. Have a really interesting time.

2:12:39Every single time you eat, you have an opportunity to improve your health. That's why I love Zoe because it helps me to make the smartest food choices for my body. As you guys probably know, Zoe is a sponsor of my podcast. I'm also an investor in the company, which is important to say. I invested in the company because Zoe combines my health data with their world class science. Using these two things, Zoe guides me to better health every single time I make a food choice in it, which means I have more energy, better sleep, better mood, and I'm less hungry. And the best part about Zoe is that it's backed by their recent clinical trial, something called the method study, which is the gold standard of scientific research.

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2:13:54Q1 is often when businesses start implementing new systems and processes in hopes of creating efficiencies for the year ahead. And over the course of my career, I've learnt just how crucial having the right systems in places, one which has helped me across many of my investments is NetSuite. They're also a sponsor of this podcast. NetSuite is the number one cloud financial system through their streamlined platform. You'll find all of your accounting financial management inventory and HR in one place. Their technology has been a real game changer, especially for my team at Flight Studio. As over the last year, we've moved out of startup mode and into scale at mode.

2:14:29We no longer have to juggle multiple systems and having everything together has reduced the number of manual tasks and errors. Over 41 ,000 businesses have chosen to future proof their business with NetSuite. So if you'd like to learn how it can help your business, head to NetSuite .com slash Bartlet and free download the CFO's guide to AI and machine learning. That's NetSuite .com slash Bartlet.