podcasts
Peruvian Bull unpacks GameStop’s Bitcoin strategy, gold market stress, and the Fed’s impending QE-driven liquidity shift.
In this episode of TFTC, Peruvian Bull explores GameStop’s potential Bitcoin strategy, gold market stress, and the Federal Reserve’s looming return to QE. GameStop, now holding $4.5 billion in cash, could follow MicroStrategy’s Bitcoin playbook, triggering a short squeeze without relying on debt. CEO Ryan Cohen’s discussions with Michael Saylor hint at this shift. Meanwhile, gold markets are showing signs of strain, with record physical deliveries and bullion banks scrambling for supply—an indicator that central banks, including the Fed, may soon return to QE. With $10 trillion in U.S. debt rolling over at higher rates, the Fed faces a dilemma: cut rates and risk inflation or maintain high rates and threaten financial stability. Historically, Bitcoin has followed gold in front-running liquidity injections, signaling potential upside ahead.
This episode of TFTC explored GameStop’s strategic pivot, gold market stress, and the Federal Reserve’s monetary challenges, all pointing to an imminent shift in global liquidity. As inflation, debt rollover, and market manipulation intensify, Bitcoin stands out as the ultimate hedge. Whether or not GameStop adopts Bitcoin, macroeconomic forces are making its adoption increasingly inevitable. The coming months could be pivotal for Bitcoin, gold, and the broader financial system.
0:00 - Intro
0:48 - Will bitcoin blow up Gamestonk?
16:49 - Fold & Bitkey
18:31 - Bitcoin has completely outpaced crypto
25:34 - Lightning
27:44 - Unchained
28:44 - Gold markets
33:43 - East/west liquidity drain
37:26 - Bessent's reset
39:21 - What's gold's real price?
44:59 - Tariffs and regulatory changes
48:45 - Bitcoin/gold lagging corelation
53:27 - QE is coming
59:03 - DOGE
1:02:19 - Debt paradox, price prediction
1:04:56 - If you're not paying attention, you probably should be
(00:00) if they buy Bitcoin and the price goes up 100% within 2 days and then shortes actually start to cover they can dilute into that and then use those profits to buy more Bitcoin and so you could see the same strategy that sailor does except maybe even in a safer way because instead of using convertible debt you're just using cash on hand and cash raise from Equity delution poses no risk to the company January we saw CPI rise to 3% and PPI rise to 3 and A2 and that's a major warning Bell that things are going wrong that inflation's moving in the
(00:27) wrong direction so why is the Fed cutting there's essentially a run on the gold markets in in London specifically but also in the US if the gold price is correct right now it's signaling that there's essentially another wave of QE coming and that wave is going to be pretty substantial and that will result in obviously higher Bitcoin prices proving bowl is GameStop going to buy Bitcoin huh well that was the uh subject of of three and a half hour spaces we had today that's why I saw I was uh again apologize for being late but on
(01:02) the Uber back to the studio I was looking at your your X page I saw that you you held that spaces what uh what was the discussion in there like it was really heated um you know it's funny with the GameStop Community it's like they because GameStop went down the web 3 rabbit hole and the with the nft marketplace and IM mutable and um basically like using eth layer 2os and loop ring to to create like nfts and coins they all the all the GameStop investors are essentially like or not all a lot of them are coiners and so fighting
(01:38) them and then at the same time Bitcoin Max is coming in the space and saying you guys are all idiots why you even buying GameStop why do you like who cares about this company just buy Bitcoin it was just like a two-front war and it's kind of hilarious but it was very uh a very good discussion I think we we orange pilled quite a few people so it was good hell yeah the I mean does cuz they made an announcement last night correct and before the announcement I think last week uh the CEO and Michael sailor were pictured together
(02:07) um what what is the latest on GameStop leading up to the picture and the announcement like are people still very into the stock or are we still going to crush the shorts yeah so I mean the story is very long obviously and complicated but um what the story has been for the last like let's say three years is really a turnaround story because when Ryan Cohen took took control of the board in August or he first he bought in in August of 2020 with a 12% stake and then Rose the chairman of the board in in January of
(02:43) 2021 which was part of the Catalyst for the initial squeeze um his role mainly was to save the company because it was verifiably going under it was extremely levered they had like a $400 million bond that was due in March of 2021 that they didn't have the cash to to pay uh they were free cash flow Negative they were losing money on essentially every single store except for the ones in in major cities in North America and so RC had to do this like turnaround story where he first started with layoffs of admin staff then he started to reduce
(03:17) sgna expenses and he was able to get them down by a significant amount I mean the sgna as a percent of Revenue went from like 36% in 2020 to like 22% now so he almost haved the you know sgna expenses and and he leaned the company so that they were able to pay off the debt and basically become uh Eva dep positive for the first time in like you know six years but the problem now is that GameStop faces is okay so they've gotten rid of the debt issue that was threatening bankruptcy and it seems like the short attacks are over because the
(03:52) barric case for the company is kind of gone right um the company's not going to go bankrupt tomorrow they have $4.5 billion of cash on hand but what are they going to do with all this money that they raised this summer in these Equity ATM dilutions and what I've been proposing and I've been a part of group of people that have been uh crafting shareholder proposals to the board as well as as public letters to to Ryan Cohen is that they buy Bitcoin and follow essentially like a a modified version of the Sailor strategy of
(04:22) turning some of their you know net income into like 20% of that into Bitcoin and potentially a third of their cash Holdings into Bitcoin if they don't have a a major m&a um you know purchase coming up which it seems it's still it's still up in the air because it's only been six or seven months since they raised all this cash but um given that they haven't haven't uh telegraphed anything um you know if they don't have a better idea of what to do with the cash I think buying Bitcoin is is an amazing answer yeah and that's what I'm
(04:52) trying to think of is who would be an appropriate acquisition Target for for GameStop and mhm I guess what are people throwing out in regards people are thinking you know Bed Bath and Beyond that which is already bankrupt that people are thinking um toys are us there's even Blockbuster like bring back the '90s kind of a kind of a a theme there but the issue that I see with that is that none of these companies are really like they're all other brick-and-mortar retailers and they might you know if you revive them and
(05:27) restructure management and get rid of like excessive sore footprint you could probably get the margins back up to a reasonable level but I don't see how that fundamentally changes like the GameStop story right that's just seems like a bolt-on that helps their business but doesn't it it doesn't catalyze growth in the same way that like Google acquiring YouTube is and so that's why we've been writing for the last you know six seven months uh to the board saying like we need you have all this cash Bitcoin is the hardest money ever at
(06:00) ever invented you know sailor has done this strategy where he's been able to Rocket the share price 2,000 plus per in a couple years GameStop is already notoriously you know shorted and you have a huge retail investor base and if you adopt Bitcoin you would adopt you'd get immediate Buy in from a bunch of bitcoiners if if if you guys were able to accept Bitcoin payments for gaming and for you know streaming services or for skins or or other modifications within a within a gaming Marketplace like think bitcoiners would adopt them
(06:31) wholesale and you'd get a whole another retail investor base so the you know the the argument there is I think very potent and I again I I haven't been able to find another company that would in my opinion rocket the share price much as much as just them buying Bitcoin yeah it was funny seeing that picture with uh Ryan and Michael sailor cuz it seems like he's taking the the letters and the the recommendations to Heart and I I completely agree if you have that much cash on the balance sheet you're not doing anything with it um you
(07:06) got to put it somewhere and it might as well be Bitcoin at least a portion of it yeah I mean it's like what what are they doing right um the funny thing with that picture is so you know Ryan Cohen has been tweeting he's he's an Austrian which is funny enough and he's been tweeting me's quotes if you follow his Twitter since like 2022 and he you know so he kind of is already in this Camp of people who understand economics understand gold um and but he got trapped on the shitcoin rabbit hole following meme coins
(07:41) following a mutable following a loop ring and pushing the company into that and they burned tens of millions of dollars with their with their experiment and it was like free cash flow positive for like a single quarter in 2021 at the height of the meme stock or meme coin Mania and nft Mania and ever since then the volume on the store is collap 97% and it's been burning money and so they closed it down uh well over a year ago and so uh it's like you know what are you doing like why why did it take you this long it's kind of frustrating for
(08:12) some of us but I think we're um we're seeing the early stages of of um of Ryan Cohen's orange pilling because right after that meeting Michael sailor started following Ryan Cohen uh on Twitter and so it's a sign that if things went well I think well he's I can understand and I agree with the consternation uh with the nft meme coin medling but everybody's got to touch the stove GameStop Ryan they touched the stove they've learned their lesson they experienced the ephemeral highs of uh a shitcoin hype cycle and uh consequently
(08:50) the uh terrible lows the the the bottomless pit of a shitcoin ephemeral cycle ending uh the no one materializing so it would I mean we I was talking about it with somebody this morning it would be incredible if they adopted a Bitcoin strategy um not only using some of the cash that they have to buy Bitcoin but signaling like others like micro strategy metap planet similar scientific cathedra have signaled like Bitcoin is our treasury Reserve asset and our intent is to build that treasury by any means possible whether that's spinning
(09:26) positive cash flow uh and profits in the Bitcoin or tapping Capital markets in uh prudent ways to uh buy more Bitcoin and the stock price CU that that would add like fuel cuz it's so heavily shorted right if you start squeezing the shorts and killing the shorts they got to go buy more stock and you have sort of a an additional fuel source to some upwards stock appreciation yeah and this is what we were talking about in the spaces ironically right like right after that and that CNBC article came out saying like according to Anonymous sources
(10:02) within GameStop the board is considering direct investments in in Bitcoin um the stock price skyrocketed like 20% in after hours um went up to like $32 and change from like 25 before at the height and then it it retraced a bit and um we saw Universal like encouragement from the Bitcoin community that this was a smart thing to do and I think especially for the um the GameStop you know meme stalkers it this could be extremely value ACC creative because as you mentioned the stock is shorted ex like to an absurd amount and you know the
(10:40) current short interest is like 30% but historically it was about 100% And we we believe that not all the shorts have closed they've just been hiding the short interest in other ways and every time that there's been like a m uh a mini squeeze or could say like a momentum push in the market it always ends up in this like parabolic move so when dfv came back in in May of 2024 and then again in June we saw you know the price Skyrocket from like $10 a share to $80 a share within like a week and a half and all that is driven on
(11:08) hedging gamma hedging with options and then retail investor buying and if if they buy Bitcoin and in a real way like just this rumor Skyrocket at like 20% if they actually buy Bitcoin and the price goes up 100% within two days and then shorts axi start to cover they can they can dilute into that and then use those profits to buy more Bitcoin and so you could see the same strategy that sailor does except maybe even in a safer way because instead of using um you know convertible debt which is you know arguably
(11:41) risky you're just using cash on hand and cash race from Equity dilution and so poses no risk to the company yeah and it would be poetic because as you were mentioning before or no after we had recorded like there was bitcoiners saying just buy Bitcoin you meme stalkers are idiots but I mean I was one of those people in 2020 2021 screaming that as well like I understand the energy and the goals of the Wall Street bets and the the people buying gamestock but like Bitcoin is the true way to get back at um the the financial system if
(12:21) you deem it to be the enemy um and a real way for the little guy to Garner some power in this world financially at least and I think coming full circle 5 years L four years later um and sort of teaming up the the meme stalkers uh coming to the conclusion that a Bitcoin treasury um is is a good idea is is a bit poetic in my mind yeah it totally is it's funny because at the end of that space as we had with like you know 2,000 people in it at at a certain point we had this guy come up who was a bitcoiner who was just roasting us he's like guys
(12:58) this the me stock is manipulated they're shorting this you know they're clearly shorting it they're clearly buying mainstream media uh you know views to to to push their narratives um bitcoin's immutable Bitcoin can't be with you know buy Bitcoin and we're like wait so isn't that the perfect argument for why GameStop should buy Bitcoin like they're the most you're right they are extremely manipulated company they have you know they've seen Short attacks we've seen wash trades we've seen um you know Bloomberg on the Bloomberg terminal
(13:29) we've seen options uh positions from major institutions appear and then disappear within 24 hours and then reappear and they all blame it on glitches um you know like we've seen all this weird happening with institutional um shorts and you're right that the system is rigged and you're also right that Bitcoin is a solution and so it's like to me that makes sense that it's the perfect acquisition for a company that's been as manipulated as as this one has and he he finally acquiesced at the end that talking he's like actually you make
(14:01) a good point I'm like okay so you see now why us GameStop holders who you know I don't hold like 90% of my portfolio in GameStop it's it's much less than that but I'm I'm I'm obviously mostly a Bitcoin holder but I do own bit GameStop and I want to see them win and buying Bitcoin with all this extra cash that they're not doing anything with currently seems like a great way to win yeah and it's just fun to to play through these scenarios like again it's a big focus of ours at 1031 on the private Market side really encouraging and helping uh
(14:37) company Founders approach uh a Bitcoin accumulation strategy obviously get Revenue get the profitability as quickly as possible then begin building that treasury um whether or not want to go public get acquired in the future um we'll deal with that but like let's focus on the the treasury first and now applying just applying this mindset to public markets too especially considering the the pools of capital that you can tap into um it's fascinating so it I think that Trend as it continues to grow again micr strategy
(15:12) started we got semar we got metap Planet obviously the Bitcoin miners um Tesla's got Bitcoin on their balance sheet and just block seeing this begin to really ingratiate the Bitcoin strategy itself in public markets how people are going to utilize it and I think I again and I can hear some of the hardcore listeners saying right now Marty stop uh stop shielding gam stop I'm not shiing GameStop I'm just having an interesting intellectual uh discussion about bitcoin's effect on public Equity markets and I think um
(15:47) GameStop getting into it again would be poetic and it would be hilarious if the stock ripped and all the shorts got blown out and the narratives that were massive in 2021 um come back and the gamestoppers are are proven to be right ultimately with what has been going on with the stock yeah and you'd see you know if that happened there's like 800,000 people in the super ston Discord or super ston Reddit page you'd see most of them get orange pilled it's like wait GameStop bought Bitcoin and that caused this massive squeeze we all
(16:21) made money and then now we can own a bunch of Bitcoin like wow maybe you know this thing is has real value real fundamentals to it so um I think that that'll be a would be a major Catalyst because again most of these people are still stuck in the shitcoin loop ring and ethereum uh phase and so it's it's difficult to get them to move out of it just because they they think that Ryan Cohen is still in that camp and I think with him changing that'll move a lot of the meem stalkers fully into the Bitcoin Camp Su freaks do you have a credit card
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(18:26) 20 at checkout for 20% off your order that's bit keyworld code tfc2 and I'm not sure if you've been paying attention to this but the dislocation between Bitcoin and the rest of broader crypto has never been as wide as it is today um I think James check from Czech on chane he posted a bar chart the other day that blew my mind which is if you took the rest of the Bitcoin that hasn't been mined yet and you basically spun it out as its own asset uh with its own market cap based off today's bitcoin price it would be the
(19:02) fifth largest cryptocurrency so you have like the the Bitcoin that's already been mined I think ethereum Ripple salana and then Bitcoin again just the Bitcoin that needs to be mined um and I think uh whether it's Ryan Cohen or whoever I think it's becoming clear that Bitcoin is a completely unique beast in this uh very confused world of broader crypto and I think even um long-term eth bag holders and even the salones are beginning to concede like yeah it's different and they're trying to create narratives of how they're
(19:39) differentiated and don't compete with Bitcoin yeah absolutely I mean eth is down 177% year today and Bitcoin is up 5.3% so it's already this year we're seeing that Divergence and if you look back on the Cycles eth hit the eth Bitcoin ratio hit an all-time high in 2021 and it's just been grinding down ever than that it was 2017 ju oh actually you're right yeah you're July 2017 it hit like 0.
(20:09) 14 per BTC 014 BTC and it's Fallen since then it gave it tried to get back there in 2021 but didn't quite make it I think it got like 0.1 okay yeah I was looking at the five-year chart but actually I do remember you're right it is 2017 but that that's the problem with all these alts is that they all get ground down to zero against Bitcoin just because they don't have the fundamental characteristics that that Bitcoin has and you know we covered that in in the discussion is like 50% of the block over 50% of the blocks of ether are ofac compliant so if you're going for
(20:40) immutable money or whatever Bitcoin is the clear the Clear Choice here because ethereum is already captured I mean so so much of it has already been uh you know pre-mined but we also have the issue of um you know the sound money fallacy which is essentially they say oh we're Ultras Sun money cuz we of deflation well you are able to change issuance and that's the definition of sound money it doesn't matter if it's deflationary right now it's the fact that you guys can change it from inflationary to deflationary whenever
(21:09) you want and so defeating that those misconceptions was like so important for for getting more of the GameStop retail investors to truly understand the you know the massive sea change that Bitcoin represents yeah and even I mean ethereum is actually inflationary again now because they've ah so beautiful and and this is predicted by many bitcoiners uh humble brag including myself for years is like they theum is the perfect representation of a second system problem like when they did the merge and the transition of proof of stake they
(21:43) were like oh we're going to make it perfect this time and they completely made a complicated rubbe Goldberg machine and could not foresee the unintended qu consequences of the changes they were making and part of that was the architecture of the base layer of ethereum is such that it's like gets really expensive to transact and that pushes everything up to l2s which is Big Meme and those are very centralized so you have all the activity pushed up to the l2s and the whole meme around Super S money or whatever they're calling it
(22:19) what were they calling it super Sone no what were they call Ultra ultrasound money there we go different Pokeball um the uh the ultrasound money like they were like all right like as fees go up we're going to burn a lot of the ethereum but they the Dynamics of the system pushed all the activity up to the second layers and so there's no activity on the main chain so now it's inflationary again and it's just been beautiful to see yeah you know vidc butan himself wrote a paper in like 2015 or 2016 um and he created this this
(22:55) concept of the blockchain trilemma where you know any blockchain has to optimize between two of the three corners of a triangle and the corners are scalability decentralization and security and so if you optimize for scalability which is transaction throughput and let's say security you lose decentralization cuz that's just a a SQL Ledger like that's what the FED has right now with their Master accounts like they just have a giant SQL Ledger they probably have very very Advanced encryption but because there's only one node they can just do
(23:24) everything instantly and the scalability is extremely high and the problem that like he understood at the time part of the issue but he didn't fully connect the dots in that any money or any like true currency needs to be the you know the bottom and the the bottom half of the triangle so it needs to be decentralized and secure it does not need to optimize for scalability because by optimizing for scalability you will lose either the security the decentralization and you want the base layer of the monetary system to be
(23:54) decentralized and secure and you can build scaling Solutions on top of that and so what if ethereum did and what all these other altcoins keep doing is they keep moving towards this scalability issue and they say well we want the base layer to be able to transact 10,000 times per second well great guys you can't coordinate that many nodes at once you need to have miners with an insane um you know internet connection to be able to process you know that many transactions and then be able to do blocks like every you know 30 seconds or
(24:23) whatever you need for that to happen so you're you're not essentially creating a real you know money that's based on uh sound characteristics sound uh sound Austrian principles you're you're basically creating another sequel coin and so that's what I just keep calling them it's like whenever they keep coming at me they're like dude look at salana like look at the TPS I'm like great guess what you can only run it you can only run nodes in an in a in an Amazon um data warehouse you can't run this thing in in Africa like you can on
(24:51) bitcoin like this is this is more centralized than anything you could even bring out to me like this is it's hilarious that they keep dragging the Bitcoin quote unquote uh decentralization failure because Black Rock owns some and because some of the ETFs own some and sailor owns you know 400,000 or whatever and then they don't point out the same you know or even worse um issue with with salana and with all these other other meme coins that just need like basically to sit in an Amazon warehouse to even run yeah I feel
(25:23) like every 3 months they need to pull the salana cartridge out of the uh the gaming system blow on it and put it back in it goes down and then they Cally coordinate to turn it back on it's uh it's laughable and the uh and and I just released an episode this morning I recorded last week with uh Lisa nigat who's a longtime uh lightning developer and that's it's fascinating too cuz like L2 is one of the big memes of this cycle and lightning is technically I hate the term L2 but it's a layer two um on bitcoin and when you compare lightning
(25:58) to all the other l2s are being spun up whether it's ZK rollups or uh whatever Bas is that coin base is spun up like even once you scale via second layers on bitcoin what we're finding is like relative to all the other l2s lightning is extremely decentralized and then on top of that it's ex it's a double-edged sword it's hard to know exactly what's going on which is a privacy benefit for people as well you can't audit lightning without going to individual node operator and getting them to download the Json files of all the traffic
(26:34) through their nodes to understand what's going on so you have this incredibly robust decentralized L2 building on bitcoin as well that people just completely ignore yeah exactly and that's what we were you know that's what I've been pushing for um for the board to do is to realize the use case of lightening especially for you know if we're talking about GameStop or even any other company right if you want to do microtransactions in in the storefront if you want to do even like POS uh sales right like at the store you can do all
(27:06) this on Lightning like they act as if it's impossible and they act as if oh well I'll have to wait 30 minutes at the store for the transaction to settle on the bass layer it's like no you don't if you're just buying a video game for 20 bucks and you got a discount code from a friend like you can go in pay with your lightning you know open up a lightning Channel pay it pay the invoice walk out and you'll be good like yeah you don't have to over complicate guys I bought a hat with lightning two days ago it took
(27:31) me two seconds I was like then have to put in my credit card information and have to put in my address or any of that obviously for the shipping I did but for the financial information the billing information just like oh Point click Send me the this rip was brought to you by great friends at Unchained as bitcoin's role in the Global Financial landscape evolves understanding its potential impact on your wealth becomes increasingly crucial whether we see measured adoption or accelerated hyperbitcoinization being prepared for
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(28:53) and what's going on there cuz that's that's another big thing that's going on right now that I think people really need to be paying attention to is this I don't want to call it chaos but you have very material things happening in the gold market particularly the draining of vaults in London where this spank of England or the L lbma um and an insane amount of physical gold coming to vaults in the United States yeah yeah there's and so I wrote um I wrote a piece last Sunday called um you know gold breaks the lbma and I was
(29:33) detailing in that piece the process by which you know there's essentially a run on the gold markets in in London specifically but also in the US so in the month of January we saw on comx a record 19,000 more than 19,000 deliveries of um of contracts and physical deliveries and that equates to 1.9 million ounces which is $5.
(29:59) 2 billion and this is record oh do you want to well I was going to say just to clarify this so comx it interacts with the CME contracts right the people calling CME futur contracts in kind yeah exactly yeah yeah and the comx I mean the comx is the North American uh Commodities exchange that is used to to settle basically all uh Commodities that you think of trading as like copper um you know wheat soybeans and then obviously gold and silver as well um and comx the the thing about it is that in North America and in in London by the way all
(30:32) the Futures markets are Prim primarily cash settled so it's this giant game of um you know paper shorting where a bank a bullan bank can take 100 ounces of physical gold they have in the vaults and they can sell forward a thousand ounces in the Futures markets and because 97% of participants are not taking physical delivery they take cash delivery they're able to just continue this game and roll the Futures forward continuously and so it's a mechanism by which um the bullan banks and just the structure of the exchanges can
(31:06) essentially suppress the price of gold in real time and we've known about this for decades by the way I mean this has been written about by uh there's a couple bloggers called another and friend of another or foa who were writing about this in the late 90s on the Gold Trail blogs um there are people you know like obviously Peter Schiff has been talking about this Mike Maloney like this has been well known in the gold space for years but the question is when will the gold market break when will the when will all the paper shorts
(31:32) or paper Futures owners come to the door and say hey man I have an ounce for or I have a I have a contract for 100 ounces of gold to give me the gold right now and then the vaults are all empty and the market goes haywire and the market is completely breaks down and I believe that this you know this could be a stress test for that exact scenario because what's been happening is we've seen this huge surge in um in current contracts on the comx being delivered and like I said month month of January was the highest January month in
(32:07) uh probably like 5 years of deliveries and if you look at the chart it it eclipses every other month by more than double they had to deliver 1.9 million ounces to uh people who were redeeming their their their futures for comx and comx responded by buying 11 million ounces of gold and filling their coffers basically front running this this surge of deliveries because I think they're realizing that their their inventories are getting too low because especially since Co they've been being drawn down especially by deliveries into into the
(32:39) West into Shang or east sorry into Shanghai and so comx has been loading up on this gold and about half of it's been coming from from uh producers from gold miners and then the other half has been coming from M mainly the lbma and so with this strain on the New York and us-based gold markets we've seen a draw of gold uh in you know West to to the US but we've seen the same simultaneous drain in in the UK and that's caused this chaos because the UK Market is thin and all the all the bullan banks and participants are trying to work on
(33:17) getting physical um liquidity right so they're trying to get the actual gold in hand to be able to make these deliveries and the problems they they've been running out of physical gold on hand and so they've been moving to the bank of England to get a source of of gold liquidity so that's been the the trend here for the last month or so and it's been increasingly playing out especially in the price yeah the because I and it's aett correct me if I'm wrong but comac physical delivery is almost at or surpass the point of covid when this
(33:56) happened in 2020 because that that I remember this popped up in 2020 too like when you had Co come the lockdowns and everybody freaked out you you had a similar similar situation arise um and it seems to be about to or already have surpassed what happened in March and April of 2020 which is perplexing because the comparatively like um doesn't seem like the global economy is as uncertain yes it is somewhat uncertain right now but compared to how uncertain it was in March April 2020 it seems to be in a much better position
(34:35) today which just brings up the question like why is this happening now so there's a couple different theories um there the first one is the trade War and the tariffs it seems that there's fear that the current Administration will submit significant tariffs to Gold um and that has caused these bullan Bank Traders especially in New York to rush to take physical delivery of their Holdings in London because the problem is a lot of these institutions actually hold their physical gold with uh London based custodians so for example the GLD
(35:13) ETF which holds you know well over a million ounces of gold has all their Holdings in HSBC all their gold Holdings custodi custodi by HSBC and all of those are in London and so if they want to take if they want to front run right some sort of tariff threat of moving gold from one country to the next will have 20% uh like fee attached to it then they have to move the gold uh right now I think that that's part of it I also think we're seeing uh massive gold demand from institutions I mean um 2024 was another record year for Central Bank
(35:49) gold buying uh especially q1 was the was the highest uh gold buying q1 in in history that that we have you know recorded for central banks so there's been this pull of liquidity in general from uh the exchanges to the central banks and that's especially true for you know Asian countries like China where you've seen not only the Central Bank continue to buy all throughout 2022 2023 and 2024 but you've seen huge retail demand and that retail demand has has been in mainly physical because the differentiator between the comx and the
(36:25) lbma and the SGI which is the Shanghai exchange is that the Shanghai exchange is physically settled only so if you buy a contract you are taking delivery no matter what it's like it's not really an option and that means that if there's a price differential between Shanghai and uh the comx or the lbma you can go to the lbma and buy gold and then take to physical delivery and then ship it to Shanghai and sell it for a higher price and ever since around late 2022 I and I covered this in another suback piece but ever since late 2022 we've
(37:02) seen uh $30 to $50 price Divergence between physical gold prices spot gold in Shanghai and spot gold in the comx and in lbma and so that's caused this drain of this institutional and Retail drain of gold from west to east um as China enters this I think kind of deflationary Crisis that they've kind of sleepwalked into yeah and what are your your thoughts on the other Theory hanging out there about Scott bent how he's been talking particularly over the last 18 months about this need for uh a like a brenon Woods or Plaza
(37:43) Accords excuse me uh soon which would necessitate like a repricing of the gold the treasury holds at the Federal Reserve from $42 an ounce to U maybe spot price some people even saying just mark it up even higher than that well I think that that that could be part of the Catalyst I mean it word Brent Johnson says it's best right like words are Easy Action is what counts so same thing with bricks with their prognostications that they're going to be starting a a currency block and basing it on gold and silver and all the
(38:23) Mike Malones and the Peter shifts of the world you know uh have an aneurism and and go on Twitter to celebrate you know every time there's a headline like that to do it in practice is much more difficult and as you know like gold especially if it's pegged to a certain dollar amount per per ounce is it's you know it's provides structure to the monetary system but it also limits the amount of money at least ostensibly that they can print and as we're going to a cycle where federal debt to GDP is 132% the Fed funds rate is still above
(38:57) 4% inflation is rising again I think the Practical uh the Practical ability of them to convince enough stakeholders to actually reart the gold standard is is very low I mean I think that's I think it's more speculation and and hopium on their part yeah that's a good point great quote much easier to talk than it is tacked yeah where do you think this goes you think this is the the big event that everybody's been talking about you mentioned the gold bugs have been um screaming from the rooftops about the these paper trades suppressing the price
(39:35) for for decades and and I I think it's safe to say they've been cast aside I think somewhat wrongly as just Nut Job conspiracy theorist M um is like what maybe the other way to phrase is like how long does this have to continue before something truly breaks and you have like true price Discovery in gold well the from the lb's own data records we know that there's about a billion physical ounces of gold in London and around 800 million of that is already claimed and so these stresses we've seen in the markets have been indicative that
(40:11) we're starting to near you know a Breaking Point right and a Breaking Point doesn't mean necessarily like oh okay all the banks collapse and the end of the world it just means gold getting repriced upwards like dramatically like a several hundred or even a, move uh in in spot gold markets with within a week or something like that um the the indicators have been numerous and I'll go through a couple of them first off like we said around 80% of the gold in London is claimed and the bullan banks are kind of panicking because you know
(40:42) they've been trading this paper credit version of gold basically unallocated paper ounces between each other and it looks like the the markets that facilitate that are starting to freeze up the bulling Banks and the dealers are not wanting to make make those trades or to even try to redeem the paper unallocated gold and they've been going to the Boe because they you know they're they themselves are running out of physical gold so they've been trying to find other sources and the bank of England has you know a sizable amount of
(41:11) of uh of physical gold I think you know over 40 tons and so they want to have you know some sort of liquidity and the Boe has a leasing program where they can lend you gold uh at different rates obviously for different uh maturities and you just have to give it back to them so to get this liquidity because it's mainly liquidity issue all these bulling banks have be going to the Boe the problem is that the Boe is not set up currently to manage this kind of demand and this kind of um you know logistical constraint or or uh or or
(41:42) pressure and so that's meant that the uh the weights at the Boe have extended to like four to eight weeks for even authorized participants to get physical redemptions of of gold and the the Boe also sells these like paper unallocated um gold certificates basically promises to get gold and the the Delta between those uh paper you know paper promises for gold and and the real spot Market is now widened to you know several hundred times larger than what it normally was and for reference it's only like a $5 price differential but normally the
(42:19) boe's gold they're they're at least they're paper promises their IUS their gold shirts trade within a few cents of spot and they've blown out to $5 so this is a a massive massive dislocation in the price for for the boe's paper gold and it's showing that you know the market essentially doesn't doesn't believe that they have all the gold that they've they've claimed yeah I I think the weight like this is essentially you have a a bank run in the beginning stage of bank run like the weight times persist and God
(42:51) forbid they get longer you sort of have the social element that Creeps in where it just feeds on itself yeah no totally and we've seen like we've seen the contagion spread in um you know late so late January we saw that's when the first basically the first warning signs of the boe's logistical you know constraints started to to show up where they started putting delays on physical Del deliveries of gold where their paper you know search started trading below market value then we saw um you know obviously like
(43:21) refusal of redemptions for for retail investors and for non-authorized participants which are authorized pres are just the large institutions and banks that that own gold and then we saw this move to even the ETFs so GD ETF like I mentioned earlier they custody um well over a million ounces in in HSBC in London and the GLD ETF restricted short selling on their stock or on their on their ETF shares at the end of January and then they also saw a like a 6% rise in the borrow rate of their shares because what authorized participants
(43:58) were doing was they would take GLD shares and you could redeem them for the fiscal gold but only redeem them in London and you you had to be obviously a bank or broker dealer and then they were taking physical delivery so they're using the ETF shares they're borrowing them they're redeeming them and then they're taking physical delivery of the ETFs gold that's stored in London itself and so the like the pressure you can see is building and it's it's substantial because again we I don't think we've seen this kind of stress in the markets
(44:28) you know since Co or even before so this it is significant for sure where are we trading right now for gold yeah gold hit like 2880 uh yes or at Le I guess that'd be Wednesday it was an alltime high and then now I think it's like in in the low 2800s but it's been hitting all-time highs for the last 3 weeks or so yeah now it's uh I don't even say like cuz again in 2020 I remember I recorded with Roy saog while this was going on he's a long time um gold Trader I think he very good knowledge on the bulling markets and at
(45:10) that time it was like ah things could really get out of hand here and obviously um things settled down now it's bubbling up again only 5 years later it's like all right what uh is this just another sort of temporary bubble up like it was in 2020 or do things get more serious this time around and you have a different Confluence of variables contributing to this whether it's the tariffs um or just uh people calling more physical because they don't trust that the uh the paper is representative of all the gold that that
(45:48) exist in these vaults mhm yeah and you know there's also been regulatory changes right we saw adop you know change to the NSS R which is the net staple funding ratio with bosel 3 in 2021 that allowed gold but only physically phys physically held and unallocated gold Holdings to be counted as 0% haircut assets under basil so basically allowing them to be treated as like reserve a reserve asset like just like treasuries or you know MBS or whatever whatever other high quality Bond so um those changes have happened
(46:24) and have there's been also a categorical shift with institutions view of gold obviously so we we've talked about with Central Bank buying and with retail institutions buying retail and institutions buying especially in China um there's been a demand for gold but I think you know we're both in agreement that gold is the uh the old Boomer Bitcoin and it's just buyer better to buy Bitcoin because you don't have this settlement issue in the trust me bro IOU problem that the physical gold market has and it's it's it's systemic it's
(46:55) it's structural to the to the market itself self right there's is something else that the some of the gold bugs I think they misunderstand is they apply their Austrian economics on how the world should work right the gold should be the money that everyone uses and everyone should walk around with flakes of gold in their pocket and gold bars and be shaving off a little bit for a coffee and shave off a little bit for your groceries and get a bigger chunk for your car repair the problem with that again is that gold has a dis settlement
(47:21) and centralization issue where it's impossible obviously for microtransactions to be conducted in Gold so it gets centralized and stored and it's just like a phys this is just a mechanistic like physical law that is impeding gold and then once you do that once you centralize the gold and issue paper promises to to transact in it you get this issue of okay well do they really have the gold can we trust the auditor even if they are audited and then some banks obviously like the Boe has been refusing Audits and the FED has
(47:49) ref you know famously refused audits so no one really knows if they actually have the gold or if they're just holding uh gold credit with other institutions that also say they have the gold so the this issue is systemic to the market and it's structural and even if we reset the system today back to 100% gold reserves it would eventually start to to perpetuate itself again it would eventually start to to to see more paper gold trading Than Physical we start to see more and more promises well taking delivery is is difficult right at the
(48:21) comex it's 100 ounce bars and so if you're a retail investor that's $280,000 or whatever like you're not going to take that physical 100 ounce Barn delivery so you just settle it for cash and you would just see the system perpetuate itself again and explode to the current you know 10 to one paper to Gold uh leverage ratio and it would just it would just happen again yeah yeah Gold's physical nature really cucks it in some regards that's what it's been fascinating to to watch as a big winner I'm very what you just described is uh
(48:57) would be chaotic for our gold bugs I'm very sympathetic to our our gold bug brethren in the sound money Community here the broader sound money community and that's I mean that's what bitcoiners have been beating the drum on for the last few weeks as gold has been consistently hitting new all-time highs and bitcoin's been range bound between like 95,000 and 103,000 is Gold's going to lead the way bitcoin's going to follow but it's going to outperform by multiples in terms of how much it appreciates comparatively and I I do
(49:28) think there is a lot of credence in that iidea I think at least in a short-term history post 2020 it's traded that way um that sort of correlation that lagging correlation and outperformance that Bitcoin has with gold but you can you can feel it like in the Bitcoin world today you had Abu Dhabi announced that they have a 430 or maybe not announced it was disclosed that they have a 430 million doll position and in Bitcoin ETFs um obviously the Administration is very Pro Bitcoin at the very least from a regulatory perspective to let it
(50:03) flourish and potentially at a strategic Reserve level um and it feels like the the Tailwinds are building and then Bitcoin is just range bound and the range is getting Tighter and Tighter and something's going to happen at some point I think in the relatively near future where it breaks one way or the other and my um my belief is going to be up granted anybody listening new to the show my bias is uh Bitcoin up always so take that with a great assault but it feels like things are are coiling for a big move oh for sure and generally again I'm
(50:37) not a chartist I'm not a technical day day-to-day Trader but I you know I've had I have read those books and I have traded before um generally if you see you know a narrowing range and and increasing volume within that range it's it's coiling up for a big move either way and I agree I think that the move is going to be eventually to the upside because gold has historically and again I wrote another Subs piece about this called printer is coming back in October of last year but gold has historically front run waves of QE by about 12 to 18
(51:07) months so if you go back to uh the first gold bull market or maybe not the first but the first major one in this Century in you know 2005 to 2011 um gold front ran the first major waves of QE first in in 2008 and then the next QE2 that started in 201 2012 and even qe3 and then once you know QE was seen to not be like the balance sheet was stabilized gold started to get ground down again and and fall to its you know alltime lows of like 1,50 an ounce or whatever or I guess you know 10e lows and then we saw it front run
(51:47) even before covid we saw in December 2018 gold start to enter a bull market uh rally and uh basically you know front run the QE uh and run all the way up to $2,000 and 7 270 an ounce in August of 2020 um while the Fed was just starting QE and then obviously it started to retrace as the Fed was doing more QE but what it was doing was it was foretelling of a of the next of the taper cycle which you follow it you know August 2020 18 months later is roughly when the FED started to do um you know their taper and so which
(52:26) is March 2022 so this cycle has been seen again and again and obviously like you said gold has much less uh sensitivity to you know changes in global liquidity than than Bitcoin does like we're talking orders of magn well not orders of magnitude but multiples less you know if if net liquidity Grows by a dollar gold might go up by a150 and Bitcoin might go up by $5 like it's that severe but gold has historically been this front runner of of global liquidity and so if you take the gold chart and you um you know I guess you you push it
(53:03) forward or push it back to the price of Bitcoin it also foretells of a massive rise in the Bitcoin price in the next you know six months or so and so if if the gold price is correct right now which it's I I think it is and signaling that there's essentially another wave of QE coming and that wave is going to be pretty substantial and that will result in obviously higher Bitcoin prices yeah and that's the many people are surmising that that QE is coming something's going to break in terms of liquidity in the system where is exactly
(53:37) unclear I guess s that to you like we're looking at the markets right now reverse repo um is is draining I believe it's under 80 billion right now available in the reverse repo markets falling all the way from 2 trillion in 2022 I believe so that is is a significant uh alarm Bell I think that's going off and then on top of that obviously you have a bunch of debt rolling over right now here in the US and I believe tomorrow uh the 2015 there's a block of 66 billion doll worth of 2015 10year Treasures set to roll over they were issued at
(54:20) 2% and they'll roll over tomorrow at like 4 and a half% and so that that represents I believe like a uh $130 billion of additional interest expense on the debt annually just for this one block of 10year treasuries and we have 6 trillion of of treasury notes bonds and um bills to roll over in the I believe the first half of this year and so whether it's an overt liquidity crisis caused by something like reverse repo draining and Banks not being able to trade reserves or um somebody looking at treasury issuance and the rollover and saying hey
(55:00) we need to um figure out a way to to lower rates to bring these yields down so that we're not rolling over and adding $500 billion do annually to our interest expense yeah exactly I mean you said it right there's yeah 6 trillion in the first 6 months I think the total number for 2024 is around $10 trillion of debt to be rolled over right almost a third of the entire federal debt load this is an extremely debt every a year and that's part of the reason why I've been um arguing why the FED is actually easing right despite the fact that we're
(55:34) not in a recession we're not fighting a direct War even though we're funding two Wars obviously indirectly um we're not fighting a direct War there's no major banking Panic at least on the surface so why is the Fed cutting right if everything's so great and the economy not solved yeah yeah you're right it CPI inflation's been rising since uh you know TW September of of last year has been going up for each consecutive month and then this month obviously uh January we saw uh CPI rise to 3% and PPI rise to three and a half and that's a major
(56:10) warning Bell that things are going wrong that inflation is moving in the wrong direction and yet the FED all they've done is to say okay we'll still cut but we'll just cut a little less and historically the problem with that is that obviously first of all the FED has never done a cutting cycle without doing Q uh ever since 2008 so if we if we're going to be doing this cutting cycle and not doing QE it would be a break from the historical norm and also I think operationally it'd be next to Impossible because if you're going to cut rates
(56:39) especially to zero on the FED funds rate you have to have the entire yield curve kind of follow you there and without fed buying it's going to be impossible to move the yield curve to be you know especially the front the short end or the front end to be um to be on on par with you know around where fed funds is at so if you're operationally thinking and you're a Fed a Fed Governor you know how do you do this how do you how do you pull this magic rabbit out of the Hat how do you lower rates without causing more inflation and without doing qwi I
(57:12) think you can't do it and if you have to choose between treasury market solvency and more QE and just getting yelled at on TV I think you're going to choose the latter yeah I forget it was earlier this week or last week but Dr Pal's comment post fomc meeting were pretty interesting where he explicitly said like we can't do QE until interest rates are by the zero bound so I think I think that's what is if my memory serves me correctly it was something of that like sort of choreographing like yeah yeah historically he's right but
(57:47) he's also here's the other thing thing that people should notice is that we haven't had a slow steady cutting cycle since the 1980s so every cutting cycle since you know mid 80s post V vulker shock has been basically like very quickly down within 12 to 18 months the rate goes down 5% right you saw that in the 90s you saw that in the 2000s with the tech Bubble Burst where if F funds rate fell all the way to 2% from like you know 5 and a half or 6% before you saw it again in 2008 obviously we went from 5 and a quarter all the way to zero
(58:21) post 2008 and then again we saw this in in 2020 with Co we saw the FED funds rate dropped to zero within very very short short amount of time so with them talking about this slow and steady cutting cycle again I think it is going to be slow and steady until there's an issue or until just the funding needs of the government are too much and once that that funding need becomes too much they just don't have a choice they're just like okay we have to lower race to zero we have to do QE we have to grow our balance sheet again and they'll
(58:50) create another reason why they'll talk about this is transitory it's a temporary government program etc etc etc but but the end result will be more liquidity more Bond buying and more monetization of the debt yeah that's what I think obviously the Trump admin has to be aware of what's going on particularly in treasury markets and all the debt that needs to be ruled over where yields are and I guess is that and I think people are uh hoping for a Saving Grace in Doge and all this cutting like all publicly is being positioned as and
(59:27) rightfully so to a certain degree as a way to root out corruption and wasteful spending that that Washington has engaged in um in recent years and decades uh if we're being honest um it is had has been interesting like since Trump's got into office like without cuts the yields been coming down and I think that's because Bond B saying it looks like at least on the fiscal side the US is putting an honest foot forward to try to get things under control start with us Aid um M to Medicare Medicaid uh the IRS is getting
(59:59) audited and um there are hopes that eventually they'll get to defense um which is a large part of our spending and maybe I I don't the probability I would put on this is very low but is there a way that the Trump admin could thread the needle with all this cost savings on the fiscal Side by essentially like sending Elon and his crack team of autis in to figure out where the money's being being wasted and cut it out as quickly as possible to signal to potential Bond buyers like Hey we're getting our act in order like you should be buying our
(1:00:34) bonds well I think editing you know auditing the defense department is a very quick way to get yourself uh suicided on you in your car on a Sunday um but I'm I'm look I'm hopeful Doge has done much more than I initially thought um with finding corruption and and waste obviously um but I also know you know as a pragmatist and as someone who you know has studied the the federal budget the real the real you know monster in the room elephant in the room is the non-discretionary spendings Social Security it's the Medicare Medicaid it's
(1:01:12) you know defense it's those things and those things are extremely hard to cut and like let's say let's say 10% or even 20% of that spending is fraud and we can just cut it out completely without having an adverse effect politically um the rest of it is not and if the Lion Share is is you know fundamental spending that's going to voters they're not going to vote for their own paychecks to be turned off their own Social Security checks or their Medicaid Medicare assistance to be to be halted and so what that means is that
(1:01:44) politically it's it's next to impossible for them to cut that spending and I think you know unless Trump is able to get a coalition of Republicans together that have enough willpower to become essentially like tea party participants and Ron Pauls and just slash the budget and axe all their political careers and and be out of politics forever uh I think that the budget problem is not going to be solved just by Doge you know they they might cut a few percent but him talking that he's going to cut you know two trillion of spending a year I
(1:02:16) mean you got to go after Social Security and defense for that there's no other way around it yeah and even if we were being generous and saying ah maybe yeah maybe all the will happen you can do that like they're still mhm the the clock's still ticking in the sense that when you to roll over this debt yields are where they're at and the market reaction to the spending cuts may not happen until after his first year in office after which point like all that debt already of been rolled over at higher rates and you're
(1:02:45) stuck with that interest expense um so yeah it's a show yeah it is a show and you know that's so that's the irony is that um I called this the the Peruvian bull debt Paradox had a tweet about it in like October 2022 that went kind of viral where I was basically saying like here's the irony is that the higher they hike the further they move behind the curve because with this debt load you're raising rates into an environment where your interest expense will blow out and then you know your borrowing rate obviously will blow
(1:03:16) out because you have to finance that that additional uh interest expense cost and then that means that the curve is essentially steepened more and more because you have to you know borrow more and more and pay more and more interest expense and so the the debt spiral accelerates and that means that with the next wave of QE when you have to do the next round of easing you're going to have to be buying more bonds than you would if you hadn't hiked ironically and so there's no there's truly no way out of this conundrum like they're trapped
(1:03:44) in this black hole of their own design there's no you know there's no magic button they can press that will get them out of this they either die via inflation by cutting rates to zero and doing QE or they die eventually by inflation by raising rates to 5% and incurring a bunch of interest expense and accelerating the national debt spiral and then lowering rates and buying a bunch of that debt that they you know caused in the first place and so there's there's no easy solution for the fed or for really any Central Bank
(1:04:16) that's facing you know above 120% debt to GDP I mean QE is is really the only answer here it's going to be infinite liquidity soon how high does Bitcoin go I mean hard to put a a price Target right as uh Max Kaiser says you know Bitcoin has no top cuz Fiat has no bottom uh but I would say I mean this cycle obviously uh targeting 250k you know hopefully up to 3 300 350 potentially but I mean in the end game obviously in the next 10 20 years I mean we're talking millions of dollars per Bitcoin easily yeah yeah and I I think
(1:04:55) uh I think things could get weird this year in the in the Bitcoin Market it's because of all these factors we've been discussing over the last hour um and and it it is with this Trump Administration with Doge it does seem like again there's an honest effort to cut out the waste and spending but as you said this conundrum that exists with the death that already exists like there's it's I don't want to say it's a it's a worthless effort cuz I do think it's earnest and worthwhile and virtuous to cut out all those waste and
(1:05:30) highlight the corruption and kick these parasites out of DC but I think the end state of the debt situation was predetermined once we passed a specific threshold 120% debt to GDP is one many people like the reference as once you pass that you don't come back who knows what there was there but I think wherever that line is we crossed it a long time ago and there's nothing anybody can do to to fix it to go back yeah on the other side of the line yeah we crossed as I term it then monetary Event Horizon right and so once you
(1:06:05) cross that 120% debt to GDP um you have this issue of you know any any increase in in GDP gets financed by additional debt and the the ROI on that debt becomes negative you have to go into more debt with each marginal dollar to produce diminishing returns of growth of of real GDP and so that means with diminishing growth of real GDP you have diminishing obviously real tax dollars coming in and so that's why your ability to finance that debt is collapsing and you have to um you know you have to pay it by borrowing right so your ability to
(1:06:40) to fund it by real tax receipts falls off a cliff and you you have to borrow the difference and that increasingly means more and more money has to be borrowed the reason why the 120% is like the figure that everyone thinks of is because Hindenburg research released a uh report uh I think this was like in 2017 where they analyzed every country since 1850 that's gone above uh 120% debt to GDP and they found that you know 54 out of 55 countries had defaulted by either you know a straight out demonetization of the currency a
(1:07:15) hyperinflation inflation or a depression and the only exception out of those 55 countries was Japan and Japan is obviously currently in its own like Yen crisis slow motion uh currency currency meltdown and so there's really been no exceptions to to this Harden fast Rule and the US even though it's a reserve currency which grants it additional borrowing capacity and additional demand for its currency outside of its own borders the US is not immune to math either and so because of that we're you know we're running up on
(1:07:49) this increasing inflation lowering rates conundrum and I think the uh you know the price for Bitcoin that environment is is whatever it it needs to be in a in an infinitely debased World it needs to be way higher in an infinitely debased world uh I think that's easy easy to say um thank you for doing this I know Friday afternoon we sort of put this together last minute but I saw you put out your piece on Sunday and I think it's very important if you're listening to pay attention to the gold markets I know this is a Bitcoin podcast and many
(1:08:21) people like oh Bitcoin Gold's a shitcoin why leading indicator very important and I think seeing the flows of physical gold that have uh materialized in the last few weeks has been very fascinating to watch play out this is exactly what was happening in the beginning of 2020 before there was a ton of Market volatility and I think that alone is a canary and the coal mine that we've seen before it's happening again you should be paying attention to it exactly like I said gold is front running liquidity like it has done in the last three
(1:08:52) Cycles if that's true that means Bitcoin is being primed for for another huge move higher and you know if you're a bitcoiner and you're thinking yeah who cares about the gold market this thing doesn't really matter it's anachronistic it's a pet rock I think that that's completely wrong because again you have to remind yourself that these institutions function on this older standard of of how things are you know how things are valued and for them Bitcoin is extremely speculative and they're just starting to get their toes
(1:09:21) in but gold is something they understand and gold is for them the Hedge against uh inflation and debasement they literally don't have the infrastructure to have Bitcoin as Reserve asset particularly like the banking the banking sector specifically like like you mentioned basil 3 like has made gold physical gold like a an asset they can hold as a Reserve without taking haircut on it um like here in the United States at least like and Europe's completely but here in the United States we just had Hester Pierce at the SEC repeal
(1:09:53) Sab 121 and issue Sab 122 which allows the banks to to custody um Bitcoin um but they haven't built out any of that infrastructure if they wanted to um they couldn't even do it yet there was announcement I believe State Street and city um have signaled that they're going to get into it but you literally need to adopt technology set up processes compliance all that to do it first to bring on bitcoin as an asset whether you hold it on behalf your customers or the the bank itself and that infrastructure exists for gold and it's being leveraged
(1:10:25) use right now and that's something we should be paying attention to yeah and this is a massive opportunity obviously for Bitcoin companies right go go start a custody service and get a bunch of bitcoiners together and teach institutions how to how to safely custody their Bitcoin and you know help this adoption curve along because you know getting institutions in the door obviously increases the flywheel effect of Bitcoin and and their ownership of individual coins doesn't affect you know the nodes or the miners and so that's
(1:10:55) you know that's bullish for the price and bullish overall for the ecosystem yeah and if and if you Bankers out there are listening to this and you're thinking like we need Bitcoin infastructure uh a magic partner at 1031 we have a lot of portfolio companies that could help you out hit me up okay we can help you Prov bow it's always a pleasure we got do this more often I think I say this every time come on this is fun I love talking macro with you Marty you're you're very knowledgeable and you always ask really good questions
(1:11:21) that make me kind of squirm in my seat to to give a good answer so maybe we should do a quarterly Peruvian bull update we'll uh we'll try to mix that in let's do that sounds good all right you go enjoy your weekend Happy Valentine's Day hope you have a good one thank you all right peace and love freaks
