0:02 Do we still even have the theme song to start the show? Does it start? I haven't watched one of our BDs. I haven't. I haven't watched two today. I don't remember. You've got to be close to the
0:15 mouth or Jacob yells at us. So you try to keep it a fist. I only my earworm for podcast themes is always Chuck Yates needs a job. Yeah, that's pretty good Yeah, I want to get a new song there
0:31 because I had the one song that sounds like the cure. And the one I use now is the ACDC one and I've kind of been stuck on that for the two years and I can't get rid of it. You know, 90s random's
0:43 favorite thing is he and I went to New York together to get a Frankie's party. And he busted me because we're just walking around and I'm singing my own theme song. I think that was Pete Chuck
0:54 Norris Do you have an ACDC photo bomb? I doubt I've never met the ACDC. Apparently, they're playing in Dallas in September, October. They're doing the stadium tour. Yeah, a friend of mine said,
1:09 Clear your calendar. I've never seen ACDC. It's one of them. Oh, they're really good. I know it's one of the longtime kind of gaps in my concert. Yeah, historically need to get to that. So
1:21 significant upgrade to both Colin and Kirk, Lisa Hubp. Thank you for joining us. Thanks for asking me This is so cool. Very cool. I feel like I've made it to the big time. Oh, no way. Yeah.
1:34 The, have you had her own? No. No, that's the big time. No,
1:42 you should aspire to it to a way more than that. But anyway, you're cool to join us. Kick us off all things Bitcoin. Where are we in the world level set us there? Yeah, it's January 13th We are
1:55 one year into. the biggest financial institutions in the world launching their ETFs.
2:03 It's been hugely successful. And that's probably an understatement. Yeah, so BlackRock, Fidelity. BlackRock Fidelity, right. Did JP Morgan do one? No. There's still a holdout. There a
2:18 holdout, who did do them? Gosh, it's been 14 months. Like no one's even talking about who's vying for these arc I think Cathy Wood has one. I mean, I think BlackRock is the big daddy in the
2:30 group, but I looked up some numbers. They've recorded their highest trading volume is500 billion a day.
2:40 They've got about37 billion of inflows. IBIT, which is BlackRock's, is52 billion in assets in the first 11 months. I mean, it's the most successful ETF of all time Yeah. Vassettes under
2:56 management. signaling a huge shift. I actually did some research a while back and I looked for it to bring today, but I wanted to know who owns the BlackRock ETF, right? Because at the beginning,
3:09 when the ETF's launched, there was a statement that came out that most of the people were retail. It was just you and me, we were buying some Bitcoin for our portfolios. But actually, I think
3:21 about six months ago, I did some research and it's really the largest holders are millennium It's the
3:28 Tudor funds, it's all the big hedge funds. Yeah, now I can totally see, this is gonna be like the most anti-Bitcoin thing ever said, but it comes from somebody that loses his car keys every day.
3:46 I don't know that I'd ever want to hold Bitcoin in my own wallet, 'cause what is it? 16 passwords, you have to remember somewhere I would mess that up. So I get the appeal of an ETF. I get the
3:59 appeal to from
4:02 a tutor or whatever, being able to move in and out of a regulated entity as opposed to a Bitcoin with a wallet. And if you didn't remember the 16 passwords and you lost money, there's some
4:18 practical features of an ETF that makes it appealing Yeah, I think it depends on what you're looking to protect. If you're looking to protect your ability to transact and you can't use money in any
4:36 other way, you're figuring out how to hold your own Bitcoin, right? Because I'm not buying coffee with the BlackRock ETF. And I was in Africa, we were talking about it right before Christmas,
4:47 was there for two weeks. I used Bitcoin almost every day that I was there
4:54 So, you can't spin the BlackRock ETF. Right. In the coffee shop in Africa or Costa Rica or wherever. I mean, the point being that people all over the world use it as money. We use it because we
5:08 think the numbers gonna go up, which is fine too. Yeah, no, that's really interesting. I was out, we, the small town I live in, Richmond, Texas, we shut down Morton Street, which is in
5:20 effect, Main Street, three or four blocks and we'll do art fairs and we'll have old classic cars show up. It feels like we do that about once a quarter or so. And last time I was out there, one
5:35 of the bakeries took Bitcoin. Brilliant. One of the art people that were selling their paintings took Bitcoin. Brilliant. Yeah, it was, it was pretty cool, had the QR code. So tell us more
5:50 about Africa real quick. Yeah, I went out there for the Africa Bitcoin Conference. This was the third year that they've done it. It's the first year that I've attended. It was huge, much larger
6:02 than I thought. A couple thousand people, I think, were there filled huge conference rooms in a beautiful hotel, the JW Marriott and Nairobi. And, you know, we get really excited. We think
6:17 people are building cool things in the US on the tech side.
6:22 Really, you haven't even seen cool stuff until you've been to Africa to see what they're building. And again, because they need solutions. So one of the builders that was there actually standing
6:34 at the coffee shop, he had a ring on that looked like that or a ring, and he just tapped the payment processor. He just tapped it, boom, that was it. He paid in Bitcoin. And so I'm like, what
6:48 is that? That's amazing He's like, Ah, it's. whatever, you can buy
6:58 the ring off of, you know, wherever, they're10. But then you, I don't even know 'cause I'm not technical, but essentially you can load Bitcoin onto this. And it is not energized. You're not
7:10 plugging this thing in. It energizes when it touches the payment reader. But he came up with it because the country where he lives, most people don't carry a cell phone. And so he was thinking,
7:26 well, most people don't carry a cell phone, and so they can't scan
7:33 a QR code to use their Bitcoin. How could they store Bitcoin and carry it with them? Well, everybody can wear a ring. And so he made this thing. Oh my gosh. And I mean, so maybe that doesn't
7:41 sound like huge, but it really is, right? It's going to solve a problem for a few million people in a community.
7:51 mechanism, where is the Bitcoin stored? Well, Bitcoin always lives on the blockchain, right? So he has, I don't know what the process is of how his name is dread. I don't know what his process
8:03 is. I'll find out and get back to you, but, um, or you, you should meet him. Um, but it's, he's, he has somehow loaded the value onto this. I mean, is it connected to something like river
8:16 or no, no, it's custody A guardian or just, no, no, he's got his own. I wish I, I wish I had dug into it, but there was, there's a lot. Um, I mean, I would think as a, as a ring, you'd
8:31 want to load, load, you know, kind of like a, a credit card, if you will, a temporary credit card. You'd want to load5 because if your ring got stolen, you obviously wouldn't want. Right.
8:45 Well, I think that's exactly right I think it's it's something like he has a say.
8:51 you know, Bitcoin on like a, like you're saying. I forget what those things are called. The chip of some sort. Right. Yeah. That he's loaded. But anyway, Africa Bitcoin Conference, Jack
9:02 Dorsey was there. He sat in the front row every single day of the conference, like he always does. He attends the conference that's in Riga, Latvia, same thing. And that was four days long. It
9:15 was two days of Noster, two days of Bitcoin. He sat in the front row all day, every day, focused on the presenter, which was amazing. He also paid for the Riga conference. And I'm sure he was a
9:33 significant part of the Africa Bitcoin conference. But the point is, people came from all over Africa. Thousands of people came from all over Africa to talk about Bitcoin and things that they're
9:42 building. And while I was there, I also got to go visit gridless Bitcoin miner that's based in Kenya.
9:52 I got to go see one of their minds, which was basically on the side of a mountain connected to a hydroelectric facility, and the people that live in these huts on this side of the mountain had had
10:08 very little access to power before. The electricity provider had come in and set up this infrastructure, but he couldn't operate because he couldn't sell the power for really what it cost him to
10:21 operate, right? So he, I don't know, for years it's just sort of sat there.
10:28 He has now partnered with Gridless. Gridless is the buyer of first and last resort, basically. But now these houses all have power, and they have more stable power than in some cities in Africa
10:41 because of the Bitcoin miner who's come in to, you know, not only just be the underpinning the financial security for the power provider.
10:53 But it's a win literally all the way around. So in effect, create a base load demand for power
11:01 and get the assets up and running and that allows them to run a wire to houses and stuff like that. Right, but wait, there's more.
11:11 So why I think this is all really cool? And then maybe we can tie this into what I focus a lot on which is helping energy companies get their minds wrapped around the fact that Bitcoin mining is
11:28 directly tied to our national security.
11:34 Those folks in Africa, that mining operation, when Bitcoin is the underpinning for the world's financial system, which it will be inside of 10 years, I would say,
11:47 you are going to have to have access to the transaction space, to the block space, right? You can't just own Bitcoin in the ETF. And you can, me, I can't just own Bitcoin
11:59 and have my transactions processed, right? You have to have a miner who is taking those transactions that can form those transactions and put them into a block. And so those folks in Africa will
12:12 never be cut out from the global financial system They always have block space in which to transact, right? Unless their government coops it and does something else with it. But I mean, I don't
12:25 see any of that happening. But here in the US,
12:30 working with energy companies and specifically with guys that have, maybe we call it stranded gas, maybe it's just disadvantaged gas like Waja and you tell them you know, let's set up a Bitcoin
12:47 mining operator. It's accretive to you and it's operationally friendly.
12:52 And oh, by the way, we need this. It's a matter of national security, helping them connect the pieces.
12:60 It's like, for me, just absolute nirvana. And, you know, we talk a lot about grid instability, the threats to our grid, why we need to stabilize our grid, why all these new power sources would
13:16 be great for our grids. That's great. But what if Russia, China, Iran attack our grids? We already have evidence that Iran has been here and has been at some of our big transformer sites. And so,
13:36 if our grid is attacked and all of our Bitcoin mining is on grid, We then, the US. looking out again several years, if we connected all of our Bitcoin miners to the grid and the grid goes down,
13:53 we in essence would be locked out of the global financial system, much like we locked Russia out of Swift.
14:02 So I know there was a lot there, but. So taking it to the US. energy companies, particularly producers, as you point out, there's a lot of quasi-stranded to stranded gas or severely undervalued
14:17 gas that would otherwise take advantage of what Chuck has been talking about for at least a year as his mantra
14:27 molecules to electrons. And as I've said recently, it's a little surprising to me that this pivot by the producers. You've seen some early fairly notable announcements on the part of Exxon and
14:45 Diamondback saying we're open for business, but what
14:51 what what what's driving the inertia? Is it is it regulatory? Is it political? Is it just a traditional energy mindset that, you know, or is it something another thing that I've thought about?
15:07 There's been a lot of emissions reduction goals and targets set. Well, if I started adding a bunch of generation to my asset base off grid, then if it's natural gas fired, obviously I've got
15:23 emissions that are added back. Is that, you know, is that part of the the pushback or the inertia, kind of the slow to embrace? What seems like a pretty obvious opportunity just given the larger
15:37 backdrop of what we think is coming in this wave of power demand related not only to to Bitcoin, but also to high performance computing and AI. So what's
15:49 the pushback or what's the reticence? Well, I think it's the malware that is located in each person's brain, right? You have been told by people in the know, and I'm really being sarcastic, but
16:04 you have been told by Elizabeth Warren and Jamie Dimon and Warren Buffett that Bitcoin is for terrorists You have been told that for years, and that is a really hard narrative to shake. And I think
16:20 that the launch of the ETFs, I mean, God bless Larry Fink for really outing his negligence in looking at Bitcoin carefully. I mean, he literally said, I've now looked at this again and I've
16:35 changed my mind. Bitcoin is hope, right? Like, and they launch their ETF And it's the most successful ETF of all time, so I mean. Maybe he had an incentive to say these things, fine. But it's
16:49 a little bit of that. It's also, you know, when we have conversations with energy companies and they're, you know, if they humor me and they'll want to model this out, okay, well, what does
17:01 this look like going forward? What's hard, right? Because two factors mean, as Dan Morrison frequently says, like producers are the ultimate optimists, right? They always think price is going
17:16 higher.
17:18 But there's also no Bitcoin forward curve of any length. And so
17:24 it's, you know, if you think that natural gas prices are going to continue to rise and you're really not sure that Bitcoin's even going to survive and certainly there's no forward curve that shows
17:36 it up into the right that anybody trusts and certainly no one's trading it. I mean, I think you can trade three years. but it's not like that gas where we could trade a 10 year strip. I mean,
17:45 when I was trading, we traded 10 years. That wasn't. Yeah, I think on the NIMEX, you're allowed the next six months, and then you're right two years after that in December that you can lock in
17:58 Bitcoin on. So you can't really hedge it, usually. I think, you know, another interesting thing that I've heard, 'cause we had this specific issue come up, Colin and I went
18:12 and met with one of the large GMP companies, and they go, what happens with our land with our royalty owners? You know, we start mining Bitcoin. How do we handle natural gas? They're not paying
18:26 for their share of, you know, the mining equipment, et cetera. So I don't think they should get profits off it. You know, what do you do? And there's at least been some work done by folks where
18:38 you sell at whatever the market rate is of natural gas. There's not a good standard there that's set so you do get sued if you have a big sophisticated land on a royalty holder there but I think
18:55 we're at least starting to coalesce around different ways of handling that that seemed to seem to work but that was a big frustration early on But how would you get paid if you had cattle there? If
19:08 you were raising cattle on top of land where there's production under the surface? I don't know, but certainly we've.
19:18 Yeah, you told the
19:22 land owner they get a quarter of the revenue and then you're taking their natural gas and saying it's worthless and you're making something out of it Do they get a quarter of that profit? You as the
19:33 EMP company don't want to do that because you're like, Hey, I paid for a bunch of miners here that comes in that comes out so that. I don't know that the key is there wasn't really a clear path to
19:45 that, but I think what it's coalescing around is we have a subsidiary, we take the market price of whatever we could get if we sold it into the pipeline, we sell it at that rate to the subsidiary
19:58 and the subsidiary makes whatever. The other thing I think about Bitcoin mining from EP companies, you're right, it's just kind of the stodgy mindset of why would we do this, which is weird
20:10 because I've always felt like the EP business is the most entrepreneurial folks on the planet out there.
20:19 The other thing that kind of pops up is if you look at mining, it's truly what's interesting about it is there are no barriers to entry. So the profitability of mining is it's really hard to model
20:37 out. mining this is going to be profitable for me all in on the CapEx. Now, it's sort of self-correcting in
20:48 self-correcting that equipment prices do trade with Bitcoin prices and the like. But the mining piece of Bitcoin was designed to not be wildly profitable because it didn't want to suck the money out
21:04 of the system. That being said, at least in the whole time I've looked at it, there's never been a point if you set up the computers where you would ever choose to not mine. You always get more on
21:20 a unit price for your natural gas if you're mining. Now, it may not pay back the money you spent on the computers, but every EP company runs their natural gas to a gas processing plant and makes
21:34 the choice every day. Do we leave? you know, do we strip out ethane or do we reject the ethane? You know, what do we, what do we do? How do we best sell it? And you ought to be doing that with
21:45 your natural gas. There's a revaluation of natural gas and some basic Bitcoin versus pipeline sales that I've seen, you know, you've got a lot of room for error because the multiples above what
21:58 we're seeing at norm, there is such a thing anymore as normalized prices I don't believe there ever was, is quite large. And so
22:09 given kind of the risk-seeking nature of the industry that we grew up in, this seems to be kind of a large
22:23 or a target-rich area to, and I think that's what Diamondback was talking about is, look,
22:31 we're giving away natural gas, we mostly produce incidentally with oil through associated gas. And, you know, I think they've led on some of the more progressive pronouncements among the industry
22:47 and in various ways, the SMRs, et cetera. But yeah, I think getting over that hump, that stodgy mindset hump is taking longer than I thought it would, just given how big the arbitrage between
23:07 the molecule and the electron, converted molecule is from a value and a price would be equivalent. It's changing though. I mean, in the last 2025, in the last four years that I've been sitting
23:18 down with energy companies and having this conversation, it is drastically different today than it was four years ago. But who's actually doing stuff? Well, at scale in It's not a good one.
23:33 I don't think that the energy companies have fully embraced it. We know that Hillcorp has a pilot program in Alaska.
23:44 I wouldn't be surprised if there were others that are just unannounced. But rumors are conical. I mean, your industry, you were, first of all, a couple of things. You have been talking about
23:57 this and energy flourishing that concept at Empower for at least three years, four years maybe. At your first Empower, there was a panel on energy flourishing, energy security. You guys have been
24:14 talking about it for a very long time.
24:19 That party that we were at last month, we were all at last month with the governor of Alaska, there was discussion of Bitcoin mining and it wasn't that it's for terrorists. That's really new
24:34 because I go to a lot of cocktail parties and I speak at white PO. events and it used to be, oh, but isn't the government gonna shut it down? No one ever says that anymore. People are really
24:46 trying to dig into it. Anchors are trying to dig into it. Private equity groups are trying to dig into it. Especially the private equity groups because when you can demonstrate to them that you can
24:58 make their asset more valuable in a sale, like by adding a lot, by just a small portion of your
25:09 power, do Bitcoin mining, they're going to pay you this much a year. That's going to be one million or four million a year. Oh, this asset trades on an eight multiple. So that's32 million in a
25:20 sale of an asset, right? Like it starts their brains returning. Yeah. Because they're not long-term companies. It's even more compelling when the governor who's leaning into it of full 6 foot 9.
25:32 Yeah. Okay. He was tall, right? He was a, he was a, he was a, he was a giant. So, and, you know, we've talked about
25:42 Canada's making a little noise around it. Alaska certainly is leaning into it. They're just natural advantages of having a huge endowment of natural gas. Most of it stranded. Oh, and by the way,
25:59 you're in a much more advantageous climate for the operation of machines, compressors, turbines. So,
26:10 they get it. Yeah. Yeah. We're having a conference in Alaska over Fourth of July, a Bitcoin conference. Somehow, I've gotten unofficially put on the planning committee.
26:21 But, you know, I mentioned it to the governor when we met him. And he was enthusiastic. In fact, I need to speak to him. I need his contact info from somebody out there. because he asked me to
26:32 come speak at their energy conference in June, and I said, Yes, but I don't know anything about it, and I don't know how to find him. I hear it's very difficult to go through their website.
26:40 Anyway,
26:43 states should be very enthusiastic about this. When
26:48 I run the world, I would give tax incentives to the energy companies for mining Bitcoin. Again, because it's a matter of national security We have to be forward thinking with Bitcoin. It's fine to
27:05 think of it as an asset, and it's done so well. The ETFs are record numbers. That's fine, but it's a much more strategic asset than just from a financial standpoint. The value of global assets
27:21 today, I think, is roughly, what, 900 trillion in Bitcoin is at2 trillion? I mean, it's 90, 000. So 18 trillion, 19 trillion, 2 trillion. Yeah, so - So it's nothing.
27:38 With a.
27:41 Still has a T in front of it, so that - Yeah, but in terms of participation in the portfolio of global asset value, the notion that it gets to two to three percent is not out of the realm of
27:57 historical precedent. Okay, but right And we've done this math a couple of times, which, you know, for people that love price predictions, 900 trillion of total global wealth, let's say that
28:12 Bitcoin becomes a five percent allocation. Right, so like jewelry, commodities, fine art, right, Bitcoin, let's say it becomes a five percent allocation.
28:25 That would be45 trillion divided
28:31 The number of bitcoin assuming a static nine hundred trillion rise base that's a little more than two million dollars of bitcoin and so I mean I've been using this example for two years or three years
28:45 this very example and someone asked me a long time ago when will this happen like what will set this off and what I think the biggest signal is and again no one is talking about it very few people are
28:58 talking about it is that you know when Russia starts using bitcoin for global exchange of value for their natural resources right it will force the hand of everyone else to use it and when we kicked
29:17 them off swift and wouldn't let them sell natural gas into the dollarized World right and they're the second largest producer after the United States they set up bitcoin mining And they have said in
29:31 2023, they mined one out of every five Bitcoin. So think of the hash rate that's coming out of Russia, the physical mining that's coming out of Russia. We now know that they're using Bitcoin in
29:44 trade. And, you know, when I look at the picture of the 38 countries that stood together and took that BRICS photo in front of all those flags, I mean, to me, that's a pretty giant FU to the
29:57 United States. And that concerns me greatly. And that's why I've long said that I've believed Elizabeth Warren is the biggest threat to national security that we have, not Putin. Because she has
30:07 so knocked the reputation of, you know, an asset and a tool that we should be using to protect our financial sovereignty. You know, I think some of the, you know, the, maybe the indirect law
30:25 There are work injuries and spoke about it pretty recently. That
30:32 Yeah They've seen their the Andreessen Horowitz is the largest investor in Crypto startups and they've seen a number of their entrepreneurs get debunked that's that's a real acute threat I mean I know
30:48 I worked for Caitlin long at custodial bank and most of the net most at many of the people that would call us to inquire about banking had been de banked mean we had one customer who had been debunked
31:02 by eight banks and they're in a bitcoin adjacent business they're not bitcoin miners there are sick actually a software company will in the end the craziest thing about all this is the leading
31:17 currency for illegal activity in the world is the US dollar right it's cash it's not even close you know I mean and so on it I know we want to get to
31:32 a pretty significant deal, but
31:37 it's been over a year and a half ago. I called them the 180s or all these players that are reversing course. Like we've seen G-fans come unraveled.
31:51 Ned's Air Alliance, you know, I think Arjun cheered goodbye and good riddance to G-fans I think on the heels of JP Morgan being the last to leave the Ned's Air Alliance in the parade of US private
32:05 banks that we're saying we're, you know, we're not going to be beholden to this
32:13 singular climate carbon driven agenda. And so do you think we continue to see that type of rollback to reversal that then accelerates the lifts? the national security priority for Bitcoin, crypto,
32:34 and everything else that's
32:38 computing an AI-related
32:41 politically where we actually make significant progress, given the change in administration.
32:49 I think they're very - For four years is in a long time. Right. Very few people are talking about the true national security implication of it. Very few people.
33:02 And, you know, I mean, Bitcoin mining, just on the scale of what we're getting ready to talk about is the demand from data centers. Like Goldman in their report that they published in April,
33:16 they specifically say this does not include Bitcoin mining because it's so insignificant, right? The data center demand is, dwarfs anything Bitcoin mining will do. I mean,
33:31 one percent to 99. I don't know what it is, but the data centers are the whole story of power demand. And you really need to see national security and power demand as two separate issues. Yes, we
33:45 want our grids to be strong. But then what happens if our grid is attacked? And that is a huge real threat Yeah, it's interesting. So I'm about halfway or two thirds of
33:58 the way through Zuckerberg on Joe Rogan. And you know, he's doing his maya culpa of, but and he did spend 500 million dollars giving money to
34:16 democratic causes to round up votes and the like. That being said, And I can't believe I did this. Maybe it was 'cause I was working out and I was exhausted. But I was almost feeling sympathetic
34:33 for him. I mean, he's talking about government officials calling and yelling at his people. And, you know, I felt somewhat sympathetic to him saying, you know, hey, we were deferring to the
34:48 government a little bit. This was a health crisis. And you think the government's gonna tell you this. But then when he says, oh, I wanna do his right software code and build products that are
35:01 cool and stuff. And so I'm deferring to people. We get these fact checkers in. And he's like, well, behold, I looked up and it was things like, you know, everybody that's sick, whether it's
35:14 COVID or not, should go outside and get some sunlight. We all know that. We all know you should get vitamin C. I mean, Linus Pauling won the Nobel Prize for that.
35:24 I'm actually becoming somewhat sympathetic to, which I probably shouldn't be, I should be more cynical, but the social media companies, the banks that all had to join this, I mean, you've
35:37 literally had to do this to protect your franchises or else be canceled. And the only one, but the only one in real time when he realized what was going on that blew the whistle and all of it was
35:55 Elon. Yeah, and he bought Twitter. So my question is, in the example that Zuckerberg gave about, okay, they're asking them to take down fact-based information about vaccine side effects. Yeah,
36:09 that's scary. That's the red line, right? And, you know,
36:16 he went on to further explain how the weaponization of,
36:23 what the US. government wanted via
36:28 the sanctions and the fines that they faced, and particularly European companies. I think he said US. tech companies have been fine, 30 billion over the last 10 or 20 years, which is a shocking
36:41 number. And instead of getting defended by the US. government,
36:49 we want the US. to win We want US. tech companies certainly to win. Instead, there's, you know, there's an extension of that threat mechanism. And so, you know, you're at a crossroads, I
37:00 think, morally. But again, people don't think for themselves, right? And
37:09 I don't feel, in
37:13 the slightest bit,
37:15 any fondness towards Zuckerberg. I mean, I'm proud of him that he came out and admitted everything he's But like, dude, you lead one of the largest companies, like grow a pair, like be a leader.
37:31 You're worth billions, you could actually do it. Elon goes on TV and says, you know, you can go F yourself to all the advertisers. Like, I mean, Jack Dorsey has probably more eloquently said
37:45 the same things. Like the government works for us. They work for us And if we continue to just bow to, you can't say this, you can't say that, your company can't do this. Like, I'm sorry, are
38:00 we not China? No, I mean, it's scary level 1984 type stuff that was going on that Zuckerberg was recounting, that the Twitter files were recounting. I mean, it was, it was really bad. And,
38:15 you know, the thing I don't like is it's getting portrayed as, as, oh, okay, people are just sucking up to Trump. I think this is, in effect, people had a foot taken off their neck and now
38:32 they're able to actually say stuff. So I don't feel like it's sucking up to Trump necessarily. I think it's opportunistic, cynically. It's, and you've seen the parade of those who were in the,
38:48 in the, Marilago. Yeah, before that parade and, you know, the last four years were
38:56 going along quietly. That all of a sudden, you know, kind of reading the tea leaves and seeing the winds change. The question is, is
39:06 this pivot back to mitigating and reducing censorship? Is it permanent? You know, what's the battle that's going to surely unfold? I've read a lot of critique of the Zuckerberg-Rogan podcast as
39:24 well, and there's vehement opposition still that this is
39:35 mostly driven and hugely funded by a right-wing
39:43 body of thought and kind of political power moves. So we'll see. I grew up in the industry as a research analyst at least half my career and always
39:59 tend to
40:01 read things with as independent and an objective. And if something really is off or seems to be a complete misstatement of fact, you think about it more in an objective analytical way. But I I
40:20 still adhere to the adage that the cure for bad speech is more. No. Not less. Well, it's been amazing the transformation 'cause I mean, if you think about what happened like in the COVID
40:35 situation, you basically, the only way to use an emergency vaccine is to have no other therapeutic cures. So things that could help, you know, vitamin C, vitamin D, intermectin, whatever, any
40:50 sort of evidence that showed that any of those, even if they marginally helped, were obviously, you know, censored. And it's just phenomenal 'cause I never would have thought liberal America
41:06 would say rich people should get the benefit of things and poor people shouldn't 'cause that's in effect what it had I mean, Joe Rogan, when he got COVID, got to go to the best on the planet, and
41:20 they recommended Intermectin. I think they put him
41:24 on the Z-pack and the magnesium and all the stuff you did, and he had a very, you know, wound up having a mild case of it. And in effect, poor people were denied that. So it's - Why were the
41:36 rates of severity and infection so low in Africa?
41:42 Yeah. Was they been using things like Ivermectin as a prophylaxis and low dose all their lives? Yeah, the chloroquine. Right, yeah. So anyway, that's a good deal. So getting back to the big
41:59 deal. Energy is, I think, central to the national security framework that you've been talking about and immersed in. And
42:12 as part of what we have coming, And I think making the grid. more robust, stabilizing the grid and certainly making it capable of meeting this, I don't know if it's a hockey stick, but it, we
42:29 didn't see commercial and industrial and residential power demand grow for a long time and now we're facing, you know, 5 growth rates is a huge, huge number. And we've seen a bit of a, at least
42:43 mindset renaissance and nuclear So you have the biggest nuclear fleet operator in constellation, 87 of their pre-calpine portfolio was nuclear generation, say, oh, and they're the ones that also
42:59 did that are operating the restarted through my island unit one and the deal with Microsoft. Expectation is that we'll get energized sometime in 2028. I'll take the over on that number just based on.
43:16 my amateur listening of the first NRC hearing a few weeks ago. But
43:23 so they go out and make a big splash in portfolio grab for one of the largest gas fired fleets available in CalPine. So what does that say? So the interesting things for me for the deal are number
43:43 one, and I haven't seen an exact map, but basically this is put in constellation into Texas and California where CalPine had assets. So you're going to, in effect, the fast growing markets. So I
43:58 thought that was a pretty interesting take. The other interesting thing I'd like to find out, and hopefully it will come out over time, who else bid on CalPine? Did we have any EMP company's bid?
44:12 Did Exxon make a bid? Did Chevron make a bid? That would be interesting to see just in terms of reading the tea leaves of looking out over the next five years of how the industry is going to
44:24 transform who else was bidding on CalPine. Well, I mean, just my pedestrian opinion, I mean, I'm surprised that I am surprised that private equity isn't a bigger part of this market. I mean, we
44:42 know locally that they're bidding on some gas processing plants and the like. But again, if we were really thinking long term, the black rocks of the world would be buying these assets because they
44:59 are the ones who are going to be so heavily reliant on the end product, right? They need the power. And in the case of, you know, Bitcoin, which they ETF their sell to than other, about lot
45:11 whole a care don't really probably
45:14 . But I mean. you're gonna need minors with physical presence so that you can have block space. Yeah, I mean, that's gonna be a transformational leap for minors when you actually have balance
45:27 sheets. You know, you can actually run like a real business. We have equity, we have debt, we can do payables in 30 days, you know, that sort of stuff. You know,
45:41 I think the cow pine deal at 25, you know, 25, you know, to30 billion. That's just a big bite for private equity. So they might have, they might have bid on it, but you're not going to get a
45:53 stretch bid that a public company like constellation can stretch and do. You just, people are, I still don't think that we're valuing generation assets
46:05 for what their real value is, right? Like the, I mean, to your point, I think you said earlier, maybe you said it on a podcast, like need power yesterday. This whole let's build and it'll be
46:15 ready in two years or three years, the Texas Energy Fund, like that's all great, but we are so stretched for power today. I need assets today that are spending and generating electrons.
46:29 Because
46:32 I always go back to kind of the backlog of I think it's a pinnacle west They have four gigawatts in their active backlog with another 10 behind it that they haven't even evaluated or considered.
46:48 That's just one example. The thing that struck me immediately, and I've been probably to one-dimensional thinking about this, is that, you know, all the excitement around re-acceleration of
47:03 nuclear. Look at the timelines.
47:08 You know, we're five to a restart
47:13 bald facility. And we saw with Susquehanna and Amazon, some of those called interconnect agreement disputes where the where Furt came in and agreed with the plaintiff. And so there's there are
47:35 going to be fits and starts along just an inherently protracted timeline. We had Bob Coons on several months ago just talking about nuclear reality. Bob was a sub commander. Yeah, I like him so
47:47 much. Yeah, he's a he's a maxi. Yeah, I like him so much. So my first reaction was, oh, well, you know, they're they're filling the gap now. And that points almost singularly to natural gas
48:03 because the reliability, availability in the uptime and the scalability is.
48:13 really ready-made, and we've got tons of the stuff under our feet, which is cheap as hell. And so, you know, it's not coincidental that the banks and the tech companies are saying, eh, we're
48:30 gonna step back from things like net zero alliance and building these kind of grand
48:38 visions of solar arrays powering our data centers. We need to kind of not hang ourselves here and there are trillions of dollars all at opportunities of points in the value chain from banking to data
48:54 center developer, to oil and gas producer, right? To take advantage of what's coming 'cause I think we all agree that this is, this is a durable power growth super cycle as Arjun described, and
49:10 the sub-stack that he published this weekend.
49:13 And he's not loose with that term. But I think there is a
49:22 kind of shift in the posture on convenience and opportunity that is unfolding here. Right. And again, just like really draw out the national security angle of a data center or AI. Yes, we need
49:38 power. Yes, we need to stabilize our grid Yes, everyone understands that it's six X or 10 X, the amount of power required for a chat GPT search, then a Google search, right? It's an intense
49:54 amount of power draw for these tools that we're using in all sorts of applications. But
50:03 we have to have these in order to create the next layer of technology that we can't even imagine what will be, right? building power for AI for AI's sake. We're building it, we're building power
50:18 for AI and these other tools in hopes that we can solve some of the world's actual problems. Well, you're a gridless and remote Kenya example is a good example, I think, of the foundational driver
50:32 here which is playing out in other forms of energy but particularly in power
50:39 is there is a self-preservation and self-interest instinct that is going to pardon the pun, Trump, everything, when push comes to shove and that is I'm looking for survival first and then improving
50:57 my and my family's well-being and standard of living, that's what we went through. That's what everybody outside the Lucky One Billion Club is going to drive and there's just that ambient pressure
51:08 to make this happen this happen. Well, we in effect. seeded our manufacturing capability to the rest of the world and we go through a pandemic and we can't get toilet paper. I think we all kind of
51:21 learned our lesson there. And the next big one we're going to face is if we allow all the AI data centers to be built outside the United States of America, that's going to be fucked up. That's
51:36 going to be like really bad You just reminded me of a funny tweet I saw from Chris Marks this week and talking about the Winter Storm, you know, in Virginia. He said, What is it with Winter Storms?
51:46 You go to the grocery store and everybody's wiped out the eggs and the milk aisle.
51:53 No, that's exactly right. Chris is
51:58 hysterical. But now, I mean, the AI infrastructure has to happen here. It's a national security imperative. And if we don't do things like, build power lines here, cut the regulations and the
52:14 red tape to be able to get generation built. I mean, we are doing our kids as big a disservice as we are leaving them all this debt. Yeah, no. Is there anything in the collection of the
52:29 rumored blitz of executive orders? I think I've heard 100 on day one starting next week, Monday week from now that
52:41 most people think about, okay, we have this big headline grabbing OCS ban of 625 million acres, the LNG pause, et cetera. Is there anything IRA related that
52:55 might be more subtle that we should be looking for that would be really impactful from this Bitcoin national security issue that needs addressing now.
53:09 I've started really looking into how likely would a strategic Bitcoin reserve be? There's maybe people outside of Bitcoin don't care about it. We talk about it a lot.
53:23 And that prompted me to look at what's the history of the strategic petroleum reserve, which I won't pressure you here. But when I ask most people, when do you think that started? They think it
53:38 started when we had kind of the OPEC crisis, right? That was in the '70s and the '80s. We were really feeling intense pressure. Yeah, we had the fuel lines and you could only buy gasoline on
53:51 Tuesdays, one days, and yeah. Would it surprise you to know that the strategic petroleum reserve really was kicked off during the Spanish-American war? Oh, and what happened was we were fighting
54:10 Spanish-American war, and I'm looking at my notes,
54:13 but American ships were 45 miles away at a recolling station
54:22 during the brunt of this battle at sea. And there had been talk in Britain and in the United States, like we need to turn our battleships into oil-fired, you know, ships because they were all
54:39 fired with coal. And it wasn't until 1910 that the president was like, We need to do this, and we need to create a strategic petroleum reserve. And I think those first three were in Texas, right?
54:54 So it's always this intense pain point that makes us change. Like the, I'm no expert on the big-inch, little-inch pipelines, right, where we basically took, Here's another fun fact. During
55:08 World War II, 6 billion out of the 8 billion barrels of oil that were required by the Allied forces came from the United States. We actually laid undersea cables in 1944 under the English channel
55:29 from Britain to France to supply oil. Like, we have been doing this a really long time, yet we all think when we think oil crisis, it's like the 70s. Really, when you dig into it, it's had
55:43 strategic implications since the Spanish-American War. Like, we need to be forward thinking about Bitcoin and hashrate. So, you know, whether we put it as a treasury asset for the US, I mean, I
55:56 think that would be great, because I think the value will rise. It will be214 million in
56:01 a matter of years, and maybe we pay off for that. I mean, I don't know. I'm not an economics expert, right? But
56:10 hash rate here in the United States. We need to be forward looking about what we're really trying to accomplish. Haven't there been a couple of states that have established? Which are those states?
56:24 I think there are 12 or 11 or 12. I mean, the latest last week was North Dakota and New Hampshire put forth like we want to create a state strategic reserve of Bitcoin.
56:39 It's really smart. And we haven't even touched the granite state where there is no
56:46 reserves underground in the North Dakota. Well, we haven't even touched on it. We could go another whole hour on this is at the end of the day, the infrastructure being built on top of the Bitcoin
57:04 network, Lightning tick on down the list of all these all these applications we're boiling off are gonna be phenomenal for economic growth. And so if we're not protecting the Bitcoin network by
57:21 having miners in the United States, that's another bad thing. And that is exactly right. See, you're tying the bow on it because
57:32 again, looking back to the last war that we fought, which is what everyone has in their mind when they think about, oh, we'll go to war, we'll just blow these people up, like the whole saving
57:41 private Ryan or whatever hero image you have. Like, first of all, we don't even have those kids to go fight this war. Like the 22 year old boys that I see, I'm not sending anywhere. But
57:55 our protection was the ocean, right? Our protection from our enemies has always been the ocean. Well, we don't have that anymore. And so in order to protect ourselves, we need the best
58:07 technology. We need the strongest economy, right? National security is three things. It's a strong economy, you know, big military, and you're foreign relations. Like three critical aspects of
58:22 national security. And yet we just wanna talk about ESG and DEI and whatever the distraction du jour is. We've got to stop. Yeah, and I'll invoke
58:35 another subject, the difference between physical and financial, oil-trading Rory Johnston, who publishes a great sub-stack called the commodity context. I got that right. I gave him attribution
58:47 for the crude chronicles and he corrected me. Yeah. Equipped that
58:53 ones and zeros travel a lot faster than barrels and molecules. Yeah. So
59:01 that's, we've basically eliminated the moat that is the oceans is your, I think you're. point, put it simplistically.
59:12 But Churchill knew that
59:15 in 1941,
59:17 why there was so much desire and urgency to get the US. involved.
59:28 So, history doesn't repeat itself. Yes, it does. Lisa, this has been so cool that you joined us. Thanks for having me I might have to follow the run a show. Yes, standing invite to come back
59:38 anytime. How do people reach you? Find me on my website, lisahefio. You can also reach out to me on LinkedIn. I write every day on LinkedIn about these topics. And I do reply to every LinkedIn
59:38 message that I get, unless it's like, how's your trading going? And then I delete it.
1:00:04 But if you genuinely want to have a conversation about energy, national security, Bitcoin, Bitcoin mining, like hit me up and love to. Cool. All righty. If you enjoyed this week's show, please
1:00:15 share it with a friend, like it. Give us comments. Remember that I'm very sensitive. So if you're going to criticize, criticize Mark, not me.