LIVE: Anthony Pompliano Reveals His Cryptocurrency Investment Strategy for 2020

[00:05] channel we are happy to have as a guest today investor entrepreneur a man who built and sold to technology companies ran multiple product growth teams of both Facebook and snapchat hosts of the wildly successful pom podcast co-founder

[00:21] and partner and Morgan Creek digital you've seen him on CNBC you've seen him on CNN now we see her at Ulta point Daley the great the powerful Anthony pop Leon oh thanks for being here man yeah thanks for having me guys you're super

[00:35] excited so I you were just telling us that New York starting to open up again that New York starting to open up again there are uh restaurants had some stuff going on in terms of outdoor seating and more people on the street so we'll see

[00:49] do we wear the masks do we not wear the masks so much conflicting information from me in New York there's only there's only masks where there's pretty much go into without the mask there they're heavy mask

[01:02] believers right right so for the audience here's the game plan team we'll be talking about Bitcoin the US economy general and cryptocurrency in general

[01:14] will be on for about 50 minutes hopefully we see a question from you and the chat Aaron will be looking at the chat I feel like this is the man to talk pomp always brings you know that the truth of the perspective we'll see we'll

[01:27] do you ever feel like if you and Mark Yasuko went on CNBC together you'd break the internet I don't think they'd let us do that too many people um but uh I get

[01:40] first general question about Bitcoin what are your thoughts and the current state of Bitcoin in 2020 slash what are you most excited about yeah I mean I think that Bitcoin has basically done exactly what we want it to do what we

[01:56] expect it to do and there's a lot of people who are incredibly intelligent in the space they do a lot of analysis on all the intricate details I tend to just zoom back out and say Bitcoin has two core functions or two core aspects to it

[02:10] one is it's the most secure computing network in the world is accelerating right it's becoming more and more secure over time and the second is that supply and demand economics still remain valid and so having the

[02:26] having actually occurred like the actual execution of the code was a big kind of milestone and I think again just another data point that shows that this is a scarce asset it will continue to have a disinflationary monetary schedule and if

[02:40] disinflationary monetary schedule and if demand rises over time even if at a very will continue to increase I think scarcity that's from me

[02:52] personally I think that's the one thing that people don't really understand is really significant with Bitcoin the scarcity you know I'm talking about yeah it to me it's a it's a weird thing where the asset is scarce but when I go on I

[03:09] can buy right when I go on an exchange if I want to work for it and earn it I can get access to it and so people don't think of it in terms of quote-unquote scarce the second piece of it is you can buy you know a dollar of it right is

[03:24] like a house for example there's only so many houses in Los Angeles right and they're expensive and you can't buy a piece of one in most cases right and so

[03:36] with Bitcoin there's some elements that kind of slide this scarcity or make it less obvious and that's why again I just zoom out and say okay you have to remind yourself like what is this thing why is it important what makes it valuable and

[03:50] if those things don't change as time goes on my conviction actually deepens because you're just saying that hey this thing has been valid for a longer longer time period therefore it has a higher probability of continuing on that trend

[04:04] The Linde effect Delinda effect correct now that now that we are post having second half of 2020 what how is how do you think this next cycle is going to be different than previous cycles in the past ten years I

[04:20] think that the people on in legacy media are gonna have an absolute mental if half of what I think is gonna happen happens and ultimately what's gonna

[04:32] occur is bitcoiners are gonna be proven right the concerns around quantitative easing and all of the monetary stimulus and kind of the Fiat system again I think we continue to see kind of cracks in the wall if you will and and there

[04:48] issues there which for central bankers to just make short-term decisions right short term yeah it's great decision long term it's a horrible decision and on top of that I think you're gonna see Bitcoin continue to gain dominance in the world

[05:03] and as that happens the US dollar exchange value will go up and you know if we're looking at an asset that goes up past just the all-time high right I mean really I think that point alone you're gonna see kind of the mini mental

[05:16] breakdowns on the on television and in print but if this thing goes to a well all these numbers that are getting thrown out there I literally think that television like they'll go literally just throw their hands up and go what

[05:29] just throw their hands up and go what the hell is this and now I look actually most of the people on CNBC to their credit either one they understand it and

[05:43] our believers that this thing has value to they understand it and have what I to they understand it and have what I would consider in intelligent ideas and opinions around why they don't believe it will have value in the future right

[05:57] so kind of like I understand it but I don't believe X Y or Z aspect is valid there's very few of them that I would put in like the ignorant camp of course there's a couple but most of the people on CNBC that end up being ignorant or

[06:09] themselves are pretty well versed and understand it but they bring some guests right they come on and they just say ridiculous things and now like even the Sachs had via the big presentation they

[06:24] did and I saw somebody tweet that it looks like they went back to 2014 and Bitcoin and just like recycled them right you know six years later and so you know part of this is you gotta understand the incentives for somebody

[06:37] on Wall Street compared to Silicon Valley or else who cares about anybody's opinion even mine like who cares what I think right the markets gonna determine what happens here in the last 11 years to

[06:50] kind of prove that everyone who is bearish was an idiot right I mean if you bet against Bitcoin historically you've been wrong every time given enough time your opinion super chapped crypto and culture asks

[07:05] for pom what's your favorite metric for valuing Bitcoin price example on chain metrics and such yeah I don't worry at all about short-term price movement I couldn't tell you where the prices today when I tweet what the price is literally

[07:20] it's because people are like blowing up my mentions telling you what it is to me I don't worry about the value today or even in the next you know two or three years when I think about value I think out in terms of a decade plus right and

[07:35] the reason why I do that is Bitcoin is a very binary investment to me right it either is going to become the global reserve currency or it's gonna be you know not even worth talking about in 10 20 years and if that happens if it does

[07:50] kind of ascend to a global reserve currency status it will from a financial return perspective in US dollar terms be the best investment of all time right in terms of the importance in the world again or the global reserve currency

[08:05] right may kind of self-explanatory there and so when it comes to these individual metrics I don't personally look at anything what I do think is a really interesting one is there's a spring work that I have in my head when I talk to

[08:17] institutional investors around to determine the value of something like this you need us to in push means supply and demand in an equation to determine the price right well indeed let's say gold market we generally know what the

[08:30] existing supply of gold looks like we generally know what the incoming daily don't know exactly but we're pretty close and then we can plot out or kind where we think the price is today and where we think it's going in the future

[08:46] with Bitcoin we actually have a hundred percent certainty we know what the or stolen or whatever we know exactly how many exactly how many are gonna come online today and so you can almost like be

[09:00] accurate with one half of that equation right down to the exact Bitcoin and so now all you have to do is you've got to be able to forecast the demand and you superbear case whatever but you've actually made a simpler mathematical

[09:14] equation to try to determine what the fair value is today and what it think that bitcoiners in general or people interested in the asset have an advantage compared to traditional markets right they have two inputs that

[09:26] are variable but they have to figure out we really only have one and I think that's where you see things like you know stock to flow ratios or the done a great job with like those things are proving to be hyper hyperactive or

[09:41] accurate and the reason being one half of the equation is a known verifiable of the equation is a known verifiable you know input and obviously you're a big pointer we consider ourselves more Bitcoin fundamentalists it's almost the

[09:55] same thing almost do you consider yourself a Bitcoin maximalist no not at I think that from my perspective I haven't talked about this too much but haven't talked about this too much but to me the breakthrough and all of this

[10:08] is triple entry account right or what I call like automated findings and so the idea is you know if you go all the way back to kind of the time of the Medicis probably one of the greatest inventions in human history literally there's this

[10:24] guy who's dessert the father of accounting he was writing a book on these Italian merchants were literally using kind of debits and credits system to keep track of their businesses he wrote a kind of a section in this

[10:38] mathematics textbook about it and Leonardo da Vinci at the time is painting the Sistine Chapel and he figures out that there's this book that exists that has another section on math and art so he gets the book he starts

[10:51] reading it he really latches on to this double entry accounting idea has this guy come and in tell more about it he ends up telling his friends his friends they then kind of popularized double-entry accounting and that

[11:05] literally was the foundation or all sorts of innovation entrepreneurship the Industrial Revolution like all of that stuff came from that single debits and credits system but it was very silent so if you

[11:19] credit system where double entry accounting for our business for myself each one of you do individually but our balance sheets don't talk to each other right or our pls don't talk to each other and so the corollary is think of

[11:32] communication previously it was really really hard to communicate with people go visit them in person right as the telephone got invented then the internet more that we could get people interacting and communicating with each

[11:47] cumin is a node in the human network right the more those nodes kind of communicated they all send human productivity went through the roof right all kinds of things that previously were unavailable well I think that's the same

[12:00] accounting triple entry accounting is essentially the same thing it's connecting balance sheets right or or these debits and credits systems and it's turning them into a shared ledger where you I and ten other people can all

[12:15] now transact with each other in a very connected way that way was previously there's things like permissionless right and all that but ultimately triple entry accounting is super important so first

[12:29] time that gets actually put into practice is with Bitcoin it explodes hundred billion dollar asset in about a decade now there's going to be other places where we can apply triple entry account right we've invested a number of

[12:43] businesses I think the big question is like who builds the technology that manifests the application of triple entry accounting to their business so it'll take a figure technologies which we wrote a big check to they're trying

[12:55] to do it for all sorts of debt products right so home equity line of credit student loan refinancing that type of stuff we've also invested in businesses ethereal right and they're realizing hey there might be some benefits there and

[13:09] so for me it's less about like maximalism around a single blockchain right or a single piece of technology it's maximalism around triple entry accounting will be the most disruptive in our lifetime hands down period it'll

[13:23] make the internet look like doesn't even matter right when we look back a hundred two hundred three hundred years from now now what that also means though is I am a maximalist in the sense of there's only gonna be one currency we get one

[13:37] shot to separate money from the state right and that's gonna be a Bitcoin if Bitcoin does not work we will never separate state money right and the reason why is it's all about trust money is not a technology problem it's a trust

[13:50] country where the currency is fail so take Venezuela is kind of the preeminent example recently everyone believed in the state currency that state currency failed when Venezuela shows up and says hey guys sorry about that like we have a

[14:03] second one like here's our new currency everyone's like I don't show us hell no I'm not putting my wealth there right and they go seek other options whether that's US dollars gold Bitcoin whatever it is same thing I think happens here

[14:15] with the separation of state money we have one shot on a global stage two separate state money if it doesn't work it doesn't matter what else get comes along as a currency people will say oh separation of state money doesn't work

[14:28] right and so I think that that's a important nuance for people to understand is you can actually be a maximalist around currency being bitcoins are one shot to separate state money and still believe that the

[14:42] application of triple entry accounting will be pervasive in you know pretty much every other aspect of the global economy I love it I want to check the chat Aaron how many people do we have watching oh man we have almost a

[14:57] thousand nine hundred fifty people watching 218 likes everybody take two seconds hit the like button for Tom I do want to point out Tom's links are down below in the description he has a podcast he has a what's your

[15:11] favorite way to get pumped content you Sonny I Love You Tube that's this stream but he's on Instagram he has a week weekly newsletter and if everybody who subscribe to his YouTube page he's breaking up Clips like all the good

[15:27] youtuber is gonna do he's doing it right pump ends just what is your primary audience would you say for your YouTube page well it used to be people who are interested in Bitcoin and now it is people who are interested in

[15:42] business technology and Bitcoin pretty much I mean I've really tried to make a concentrated effort to start including a lot of other content other than just Bitcoin content and the thought process being you know if you just look at the

[15:57] two people that are there kind of the top of the screen so you've got PD Mangum who's a 65 year old scientist who's super into health and fitness he's kind of figuring out how to use diet and exercise to increase longevity he's also

[16:11] able to get him to come on talk all about health and fitness and diet and slip in Bitcoin and so it exposes a whole new audience to Bitcoin same thing

[16:23] with with Dustin Wilson he's the master Somali there's only 200 of them in the in the world and he's a good friend of mine but he's got this whole wine talking about wine and all the intricacies there well Dustin happens to

[16:38] can have a kind of a conversation that is a piece around Bitcoin the rest is about and so it's a way to kind of expose more people to the idea of Bitcoin ooh did he give you any wine recommendations he did I can't pronounce

[16:55] them he knows that him and I always joke when Light and usually he likes to go to places that maybe don't don't hang their hat on having Bud Light night oh look its water for the common man yeah well I

[17:11] gotta have Bud Light or it doesn't make sense nice I like it and speaking of you're talking about sort of an you invest in companies at your hedge that you're a firm generally speaking what sort of your fun strategy

[17:24] for investing in cryptocurrency in digital assets and maybe how does that differ from your personal strategy yeah so at the fun level we basically invest in two things we invest directly into cryptocurrency so obviously a Bitcoin

[17:38] about 15 to 20 percent of our funds go into that and then we also invest into the infrastructure of the industry so everything everything from exchanges to wallet to mining all

[17:52] look at there on the infrastructure side and the thought process is if you look at the entire kind of blockchain industry the two things that have outperformed everything else or infrastructure and Bitcoin right and so

[18:05] kind of if you look out over a long period of time with a venture capital investing those two things should drive the highest returns and I'd assess what we're in the business of doing for for our limited partners but I know you have

[18:19] the the bitwise fund which is pretty much the top ten - XRP and stellar isn't there another fund with like Bitcoin etherium the twenty basically we just have a fun that that fund really what we did is we structured it in a way it's

[18:33] called the Digitas set index fund literally digital asset index fund comm literally digital asset index fund comm and what we tried to do was create a index fund that was passive that looked exactly like the S&P 500

[18:45] so the S&P 500 is a collection of stocks actually not even 500 in there but but it's collection of stocks that have market key market weight averaged rebalance it on a periodic basis and then they put some rules around float

[18:59] sp500 because it doesn't have enough flow right same thing here is we said hey let's take the top 10 let's market weight average them will rebalance it on a monthly basis and then we created some float requirements that's actually why

[19:13] XRP stellar and I think maybe one or two others ended up getting excluded because they held too much of it and there wasn't enough float and then the way if Bitcoin continues to gain market

[19:26] dominance when we first launched the fun to think Bitcoin is like 60% of it now it's over 80% last time I looked I don't know what it is you know in the last week or two but what ends up happening is it's a way for let's say an

[19:39] yeah sure you're talking about this Bitcoin thing but what about all these other things right we can say hey go ahead and buy a passive index of kind of they're doing is they're getting you know 80 plus percent exposure to Bitcoin

[19:53] everything else is super small you know you might get kind of 2 3 percent of other stuff which is fine it's a way to get people in but but our main focus isn't so much that that passive index fund our main focus

[20:06] that's where a majority of the capital manages that's where really where we think a lot of the returns are gonna come from you personally obviously you are you know almost all in on Bitcoin or whatever obviously huge bid corner but

[20:20] are you exposed to anything else just for the gains I think that I have a little bit of some stable coins that blocks my keeps giving me on a on a remember to go convert it to Bitcoin um so I think that's pretty much the the

[20:36] only other thing that I have either gee USD or USD C whatever the hell they're USD or USD C whatever the hell they're giving me but III think that you know I'm 99.9% Bitcoin I wouldn't even really count that as anything so you know

[20:49] called a hundred percent Bitcoin and then really the thought process is it's a very single concentrated bet right I've got very deep conviction in it and we'll see what happens and thus far it's been a good choice compared to the S&P

[21:04] look if you uh you know I know we're if you de nominate the SP and Bitcoin versus dollars the SPS down right and and so I tend to think about that quite a bit of there's a lot of financial

[21:19] engineering going on in the Fiat system the Bitcoin system again relies on two things most secure computing network in the world and is supply and demand that's valid I think the bitcoins gonna be a pretty good place to destroy your

[21:34] wealth and let's transition a little bit to the economy but first to superjet we're getting inundated super shot so say as little as you like so we can fly through these but we just spent three real quick I mean don't you hate it when

[21:47] you touch the screen again and then disappear okay okay do you think that one day we will put an order this is big picture do you think that one day we will put an order in for Bitcoin on an exchange and have to wait hours or days

[22:02] in mind because there just isn't enough Bitcoin no that's had Marcus don't work somebody who's willing to sell it's just not what price so that person who goes

[22:14] if somebody goes in and says hey I want to buy Bitcoin and there's no Bitcoin whatever nine thousand ninety five hundred ten thousand whatever the prices in says well I'll buy your Bitcoin for twenty thousand somebody will sell right

[22:29] so it's less about access and it's much more about price and you know do I think that that can feed into a price appreciation for sure you know I can to the big show yet wait till central banks start buying this stuff putting in

[22:43] their reserves right so I don't think we'll see that day I think you'll just see price move a lot right I like it and then just actually one more from crypto and culture who says thank you for the three entry accounting reference is

[22:56] there a book that I can share with my CPA buddies that really breaks down three entry accounting model there's not I've tried to get a couple of people to write one no one will do it but there's not one unfortunately if you just google

[23:10] around triple entry accounting there's some good kind of articles and blogs that Google Points YouTube but but unfortunately notebook then just finally unfortunately notebook then just finally Ike says happy belated birthday Paul I

[23:22] appreciate that it was yesterday right it was I can't hide anything these days I'm not a big birthday guy but if I doesn't know that plane is out tweeting it but uh good dude how do you celebrate I did the same thing I do every day work

[23:39] this isn't work this is fun right like the fact I get to do this stuff every day is is a complete joke frankly hey by the way tell Polina the old Queen daily army said hi I saw her in the background we love lunch money she's in the other

[23:53] room now but yeah she over tell her that's cool alright US economy sort of big picture but we'll start with a specific question last week in this last week we saw stock and recently bankrupt companies like Hertz trade higher than

[24:09] before was bankrupt it feels very much like when we're entering into a bubble where we are in a bubble what's your take on that those two things right so the stat I think I saw don't hold me to this I think it's in the last ten days

[24:22] this I think it's in the last ten days they're on a net basis over that 10-day single stock is up let's end it you literally could have just close your eyes and pick any stock ticker and you'd be up there's a reason

[24:35] for it structurally the Federal Reserve is pumping asset prices to the moon right and they're doing it in a very systematic way until they stop doing you're gonna continue to see that happen they're gonna have to devalue the dollar

[24:48] at some point and and I think that's gonna be a pretty material event when they do in are successful there but when it comes to something like Hertz I think it was up 800 percent in like a week or 10 days or whatever it was one day was

[25:01] literally up over a hundred percent after they had filed for bankruptcy and look people made money like that's the crazy part right is like there's people who made money that day but I do think that obviously we know that that's a

[25:14] pretty stupid world things have gone insane I don't expect that to last forever but thinking last insane you know for quite a while and then the the sell more stock into the market look the fact that they're being allowed

[25:29] to do that is absurd but at the same time like I'm a free-market you know proponent and so the people are dumb enough to buy it it's kind of like look Ben you're the idiot right and don't be an idiot it's not so I don't know that

[25:43] that one's a little more nuanced to me but but it's pretty crazy to see all this happening and we've seen the Fed printed so trillions of dollars and it worked like large companies in the stock market you know unemployment has never

[25:56] but everything is reaching or almost reaching all-time highs for traditional markets what do you foresee is sort of like the next step or like another bullet they can fire if this inevitably doesn't work so I always say that

[26:11] they're out of bullets in terms of things that they can do from a option standpoint what they can do is they can go bigger with the options they've Federal Reserve only has two tools at their disposal every central bank has

[26:26] two tools they can move interest rates or they can print money right and you know news flash I literally wrote about it as early as at the glass June they're gonna go down way far on the interest rates and they're gonna print a bunch of

[26:39] money I had no clue there and go to zero and I definitely didn't say they were they could go negative that would be the bigger move and interest rates there's a religious element to that right people get super nervous and about going

[26:52] bunch of controversy but they could do it on the quantitative easing side like they're not even warmed up yet right I mean literally I saw today the current administration is putting together a proposal for a 1 trillion dollar

[27:06] infrastructure package in May the House of Representatives passed a three trillion dollar stimulus package that ended up getting struck down by the Senate see just look at this you're like look the Fed balance sheet is expanded

[27:20] seventy five percent this year right it's up three trillion dollars and if infrastructure bill passed that they're supposedly gonna propose here that would be a hundred percent growth literally a doubling of the Fed balance sheet in a

[27:35] couple of months like this is insanity and I wrote about this morning I said look at the end of the day it's like playing with fire write it when you're a kid should you play with fire no can you play with fire not get burnt

[27:49] sure but if you play with fire long enough you eventually get done say think of the Federal Reserve right can they print money of course can they print money and solve the short-term problems and not cause long-term damage maybe

[28:04] should they not pay attention to history and print forever as much as they want it's insanity I think so I think that's where we're at is like they saw in 2008-2009 like oh we printed we never saw the high level of inflation in kind

[28:19] like let's just do that same playbook again but if you actually look at the problems we have today it's really just a repeat of a lot of the problems we had in 2008-2009 and they're just bigger this time so now we've got to print

[28:31] hundreds of billions and so I think what you're gonna end up seeing is they're the road keep devaluing the currency you're gonna keep stealing the wealth of the bottom 50% of citizens wealth inequality gaps gonna continue to

[28:43] separate you know if they can't get together you know a better plan on everything you're now gonna have people who are marching in the streets not only important cause and that's kind of the impetus for

[28:57] a lot of this but you better believe that there's a lot of people marching in the streets because we have 40 plus million people who lost their jobs and most protests happen on the weekends and then one day comes every it's gotta go

[29:09] to work and the protest kind of fizzle out 40 million people who didn't have to out 40 million people who didn't have to go to work right so like and by the way socioeconomic classes right they happen to be minorities that are hit the

[29:21] just kind of like creating this almost perfect storm where monetary policy is going to be a short-term band-aid but it's gonna create incredible long-term it's gonna create incredible long-term you know negative effects and it's an

[29:36] experiment like there is no playbook for this let's see what happens working right now eventually do you do you foresee because of what you just

[29:50] said and more are we heading into a recession you know best guess nobody knows for sure and what's your sort of big picture take on if traditional year or even a depression or a depression what's your take on sort of

[30:04] depression what's your take on sort of Bitcoin yeah I think Bitcoin people have forgotten that Bitcoin was a non correlated asset for ten years eleven correlated asset for ten years eleven years right and everyone is yelling and

[30:17] screaming that bitcoins non-correlated for right now yes over a 10-week period it's non-correlated but if you go back to the 2008 financial crisis gold went

[30:29] to the 2008 financial crisis gold went down 30% in the summer of 2008 right so a safe haven asset dropped 30 percent over multiple months why is that important because during a liquidity crisis people sell all of their risk

[30:45] assets right they sell the things that previously were thought to be non-correlated whatever well if you then expand out across the entire crisis in expand out across the entire crisis in 2008 so from like say 2007 to 2011 gold

[30:58] was up like 3x almost it hit an all new all-time high and ended up coming out that entire crisis well look at Bitcoin bitcoins following a very similar trend down 50% in a single day it was down in in very big numbers overcome the real

[31:15] bad part of the liquidity crisis and it's moving with stocks but ultimately Bitcoin in most people's mind is denominated in dollars so is the stock market and so if you're gonna pump asset prices everything's gonna go up what

[31:28] difference is the fundamentals of Bitcoin or getting stronger so you get fundamentals are going up into the right the economy though is doing something different stock prices are going up into the right but the economic data is

[31:42] you're getting a separation between stock prices and the reality or the actually getting them moving in tandem so it can appear to be correlated for you know five years from now we'll look back and say hey there was a three or

[31:59] six month period where Bitcoin and other assets were correlated but at some point there is a separation and you'll see kind of Bitcoin continue to follow the movement of the fundamentals whereas you'll see either fundamentals

[32:11] drastically improved in this economy or you're gonna see stock market prices have to drop to kind of meet reality at some point this Paul Tudor Jones said bitcoins the fastest horse in the race I think that he's right

[32:24] think that he's right um let's transition to aetherium for a little bit just big-picture type questions does aetherium have fundamental value and sorry bullish on the price of ethereal or how do you look

[32:37] at it I personally tell people I do not see or understand why ethers price will go up in the future right and an ether not aetherium the platform that you build on if you look at the way that ethers

[32:53] monetary policy is structured it is identical to a fiat currency there's a group of people who make a decision on a periodic basis as to whether increase or decrease the supply to their credit they've made a decision to decrease the

[33:07] incoming supply every single time so far but the opportunity exists for them to go the other way and in that point they would actually be engaging in a form of quantitative easing right whereas Bitcoin programmatically

[33:23] is designed to continue to quantitatively Harden and so I tend to think that although ether itself's monetary policy has continued to do the kind of a sound money like principle that's not actually how its structured

[33:39] it does not have to do that and this goes to the number one point when it comes to kind of value when it on a currency basis it's not gonna be a currency is gonna be digital whether it's Bitcoin whether it's kind of this

[33:54] it's Bitcoin whether it's kind of this eath is money stuff or it's a private corporation you know or like a like a Facebook public corporation or it's a digitize their currencies where the competition is going to occur is solely

[34:07] at the monetary policy level and I think bitcoin is the only currency in the world that has a quantitative hardening mechanism that is hard-coded into the product and will not be changed absolutely

[34:23] so any coin that's going after fast cheap payments pointless you have to be cheap payments pointless you have to be a store value first so yes in a sense and what I'll do is let's start not with the crypto currencies let's just start

[34:37] with money as we know it today right look at what the US dollar is we it originally was gold and gold is really hard to transact heavy it's hard to you you got to literally cut it up right do all these kind of things to use it as

[34:51] money and that was money for literally hundreds if not thousands of years at some point we decided hey this sucks like let's create a better technology and we created paper claims on the gold

[35:03] so now the gold will sit in a bank or in a vault or house or whatever and I'll just trade you this piece of paper that represents some amount of gold you somewhere you have a claim on it right and we do that for a long time and then

[35:17] eventually we built on top of that things like a credit system electronic can't get this like stacked layer but the foundation of that was gold now we

[35:29] made a mistake in 1971 of coming off that gold standard and basically kind of and you know we're still pretending like the houses is that it's never been a good thing in history but uh but we'll see if we can

[35:43] defy history with that Bitcoin is very similar in that Bitcoin is all about spectrum for the institutional investors and I say look you could have one or the

[35:55] other you can either have super fast sexy innovative all that kind of stuff on one another spectrum or you can have rock-solid best-in-class security you get one or the other you cannot have both and what bitcoin has

[36:08] trade-off is it has chosen for the rock-hard security first now if you want to get all of the other super sexy fast scalable things you do not build it into

[36:21] the core protocol or the layer one protocol you build that into layers on top of it layer 2 layer 3 layer 4 so we see things like liquid we see it with lightning Network whatever right I tend to be bullish on them doesn't mean that

[36:34] else may have to build something else that actually ends up working but just like gold was layer 1 and then we got paper claims and credit and electronic money and all that built on top of it gold as the actual base layer never

[36:47] changed right we didn't go and say hey let's take gold and caught with some new super fashionable way to use it it just was gold same thing your Bitcoin is Bitcoin securities number one everything will be built on top of it and so what

[37:00] ends up happening is most of these other block chains or cryptocurrencies in my personal opinion they're trying to kind of skip the hard work right and what I mean by that is they're trying to build in enough security along with all the

[37:15] super sexy shiny innovative type stuff I think what many people in the Bitcoin community believe is there is no such thing as enough security it's either you're secure or you're not and especially when you then look at it and

[37:28] somebody - the other day I said look at the 3 4 or 5,000 crypto currencies that are out there if the United States wanted to attack them how many would it be successful with I literally let's say there's 5,000 coins I literally think

[37:43] there's 5,000 coins I literally think 4999 of them right there's there's one ultimately secure and it's the strongest computing power is no government in the world as a stronger computing network than Bitcoin

[37:58] and so when you look at it like that that's the game theory here right is how do you get to that money this is a multi-decade type play in my opinion and so that's why I don't worry about the price I don't like it's so

[38:11] binary but also I have such deep conviction because I think that all we are doing is we're rebuilding history we're just doing it now in this digital we're just doing it now in this digital world and in a new format I like it and

[38:25] in our final 10 minutes I have one more question on a theorem by the way we got question on a theorem by the way we got 1440 people watching 500 likes guys let's get the likes up to 600 final 10 minutes we do have a hard out if you

[38:38] want pomp back on the channel guys this is what it takes this is what it takes um but it gets to a thousand likes I'll come back oh um boom that's too hard no I'll definitely get to it in the next 24 hours but by the time you leave and

[38:53] Aaron and I totally and I totally agree about Bitcoin as it sound money versus about it on the channel all the time but in terms of D Phi and aetherium really

[39:06] being like the crime hype around D Phi what do you look for in terms of projects being built on aetherium that you said your fund investing yeah so let me separate that into D Phi first and then the etherium aspect of it so D

[39:20] and then the etherium aspect of it so D Phi in general I look at D Phi and I bit more not it fits into something I call automated finance so if you look at automated finance that's basically machines running transactions

[39:33] interactions all that kind of stuff D Phi specifically is maybe not automated but it's decentralized right and so you could still have humans and so you could still have humans participating so way I think about it is

[39:46] participating so way I think about it is 100% of D Phi will be automated but 100% of automated finance or I'm sorry some portion of automated finance will not be decentralized right so the bigger opportunity is not defy its automated

[40:01] findings and automated finances Academy we'll have some deep bye in there I think that it has incredible value and we've actually invested a number of but to me it's less about the decentralized aspect and it's much more

[40:15] about the automated finance element and there's people in the you know theorem on that whatever but ultimately that's what I think is it's kind of where the finance it's just a much bigger addressable market the second thing is

[40:30] etherium today for most use cases that people are trying to build on is probably the best thing to use right so we we tend to think that a lot of the work that's happening on ethereal it ends up being R&D right so if you look

[40:44] at pretty much everything that's built on the defy site on ethereal in the matter like it's so small that doesn't matter and by the way like Bitcoin as a scheme of the global financial system either right so it's not a knock against

[40:59] a theorem it's just the law of numbers it's just that the way to look at the size and so what ends it has to happen here is one of two things are going to occur either people are going to continue to build much more usability

[41:13] better user experiences all of that kind of stuff into decentralized finance aetherium or that is going to happen using Bitcoin as the core function of money right and I wrote this post one time where I drew

[41:28] kind of two different diagrams on one side I said you have decentralized money it's provably a store of value it's provably a medium of exchange Bitcoin all of the infrastructure historically around Bitcoin has been

[41:41] exchanges if you look at all the custody providers and all of that stuff has been decentralized money with a centralized infrastructure around on the other side the competition is you have decentralized infrastructure there's all

[41:56] the dphi stuff that we're talking about but you have money that actually isn't money right Ethan's money is not true it's just a fiat currency and again people may use it to exchange value but ultimately it will so come to the same

[42:08] thing that every other fiat currency that's right if you can print money you will do it right and so mark my words ether will eventually print money at finding should incentivize so you get one of two things either you

[42:20] bring Bitcoin over and you have it kind of operate in the defy infrastructure that exists today that's things like wrapped Bitcoin TBT see all that those types of efforts or you bring the decentralized infrastructure over to

[42:35] Bitcoin right now there's some technical challenges with doing that right that's why aetherium ultimately in vitaliy created a theorem but we do think that latter example right you're gonna see decentralized infrastructure built

[42:47] around Bitcoin we've made a couple of investments there I don't think that three years in terms of like a mainstream mass adopted product I do that's where you're gonna see a lot of the value accrue we could be wrong on it

[43:02] but if we're wrong the way that we think about it is we're not wrong in the sense it's just that Bitcoin will then be wrapped or somehow brought over to the actually made investments on both sides and the way that we look at it is we're

[43:18] gonna be wrong on one of the bets the one that ends up being right is gonna wrong right I have my own personal opinion but we're not stupid right as a both and see what happens and net base is one that making money

[43:33] infrastructure around it will become decentralized over time I love it by the way as soon as you said 1,000 likes and I'll come back or like shot up by almost 250 so people definitely want you to come back I have two final fun questions

[43:50] maybe Aron and the chat has some questions but generally speaking Donald Trump or Joe Biden who would be better for Bitcoin doesn't matter all

[44:03] politicians are the same they promised the world get very little done that the one thing that I think we've learned over the last was at 12 years now both Barack Obama and Donald Trump have been highly controversial candidates right

[44:19] for 1/2 of the population or one political party and really that's been general right I think every political candidate was quote-unquote all been done on the Internet but if you look at it

[44:34] both of them have got a bunch of stuff done right in terms they passed tons of legislation and all this kind of stuff but really not that much has changed but the president doesn't really have that much power yes they could say we could

[44:46] go to war or they can you know try to influence the Fed bacon in introduce acts like you know ACA on the healthcare side whatever but then the beauty of a democracy checks and balance is that the different political parties is like

[44:59] approved and then all of a sudden and the next administration comes in they start trying to repeal right and so like you never really get kind of what you get let's say in a economy or a government like China where it's a very

[45:11] centrally planned there's a person in charge for decades and they can really implement their idea of what what should happen in the United States that just isn't the way it occurs I don't think that Trump or Biden will end up actually

[45:26] being good for Bitcoin or bad for Bitcoin it'll just kind of be indifferent maybe you can make the argument that like Trump's could fire hurt the price for a day or something but I tend to think that it's not gonna

[45:40] matter let me bullish and my final question is let me bullish and my final question is from a fan of Bitcoin Bitcoin artists brekkie Vaughn Bitcoin pump what is the best article you've read lately anything

[45:55] is fair game I saw him tweet this no I think that the I saw him tweet this no I think that the the best thing that I've read recently

[46:08] something that I read plain and I recently watched the two-part recently watched the two-part documentary on Garth Brooks on Netflix and I mean I grew up in North Carolina so I've listened to country music but I

[46:21] wouldn't say that I'm a fanatic I listen to all other kinds of music as well I that much about a story but when you watch something like that I think it's just pretty cool to see somebody who came from you know pretty poor area and

[46:34] just put the work in over decades to become the greatest solo selling artists of all time that's probably just through recency bias like that's one of the things recently is just seeing kind of

[46:48] them tell that story through so many different perspectives it's pretty cool to see interesting and see the one who does friends in low places yeah so he basically a lot of people don't know this but uh he um when he

[47:03] first got to Nashville everyone was like dude go home like you got no shot around here and he just stuck it out right and then we started to actually crank on

[47:15] some of these songs I think it was last dance they say in the thing he had like previously had that and just sat on it and then like some record producer or somebody who's helping them make the album heard it was like - what are you

[47:30] to publish this thing's like I don't know like it's kind of weird and he was of your life you don't you know get this out there and then once he released it I think some of them I want some of them promotions at Capitol Records said to

[47:46] Garth was like what do you mean it's sitting at like you know 50 on the couldn't keep that song from going to number one if I try and then within

[47:58] like cool little things like that where you just see kind of behind the scenes of how stuff gets built I'm always interested in nice final question um I was looking at the chat well we're definitely going to get to one we have

[48:14] to a thousand in the next couple hours after the people watch this so you're gonna have to come back punk sounds good to me cool alright everybody out there thank you for tuning in I love pomp on YouTube he's dropping quality

[48:29] content on a regular basis links are in the description and we'll uh see you the description and we'll uh see you tomorrow