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The Honest Money Show is your guide to understanding what money really is, and where Bitcoin fits in. Hosted by Anja Dragovic, Australia's female-led, Bitcoin-only podcast, it cuts through the noise to explore how money shapes our lives, why the current system leaves so many people behind, and what a clearer, fairer future could look like.
Expect honest, accessible conversations with some of the most interesting thinkers in the space, the kind that take you from "I don't really get this" to genuinely curious. No hype, no pressure, just money, made clear.
Whether you're brand new to these questions or already deep in them, you're welcome here.
They thought it was a Ponzi scheme,
the market was just scratching their heads.
And then when it traded below one,
people went the other way and they were
like, okay, this is doomed to fail.
The extremes of trading at call it forty times
what your Bitcoin is worth to all the way
to trading at pennies on the dollar.
Drink water, stay calm and buy Bitcoin.
Welcome back to another episode of Honest
Money. Joining me today is Tim Kotzman.
Tim is on a mission to become the world
-leading expert in Bitcoin as a treasury
reserve asset. Welcome to Honest Money,
Tim. Thank you. Thanks for having me and
pleasure to be here. And it's definitely a
journey with that sort of introduction. So
thank you. You're very welcome. Maybe
let's get started with the Clarity Act
because that's kind of the biggest news in
Bitcoin right now. Obviously, the Senate
declined it. Do you want to tell the
Australian audience a little bit about
that? Yeah, the TLDR is it failed
yesterday. Yeah, really many of the
analysts in the space, the Bitcoin space,
the crypto space, digital assets, viewed
it as America remaining competitive and
leading in the crypto space. Maybe a
slight tailwind for Bitcoin itself, but
really more, just as the title suggests,
more clarity from a regulatory standpoint
in the United States for digital assets.
And we saw on social media today, the
commissioner of the SEC, the commissioner
of the CFTC, come out with statements that
they are continuing to along in the
process of rolling out their own pro
-digital asset, pro-crypto guidance,
guidelines within their authorities. And
so that will be great, but could
technically be overturned by the next
administration. So it'll be interesting to
see how that develops for the next two
years. Of course, we have the midterm
elections coming up in November in the
United States. So, yeah, it's unfortunate
that the Clarity Act did not pass,
especially at least through social media.
You saw Senator Cynthia Lummis and several
others, including representatives from the
White House, Patrick DeWitt and others
before him really trying to garner support
and working tirelessly to get that done.
So, yeah, it'll be interesting to see just
how pro-innovation and pro-digital assets,
pro-crypto, the Securities and Exchange
Commission and the CFTC will be as they
continue to roll out guidance here. I have
seen some criticism online that this was
done to score essentially political
points, but what is the impact on
corporate treasuries specifically why this
bill is not going ahead? Corporate
treasuries, meaning Bitcoin treasuries. I
don't see an impact. The executives at the
leading treasury companies that I talk to
on a weekly basis have said for some time
that it was more guidance, rulemaking
around crypto and not necessarily Bitcoin.
Bitcoin has been clarified by the IRS as a
commodity since, I believe, 2013. So,
Bitcoin, when Michael Saylor and others
tweets out that Bitcoin doesn't need
clarity, that is very clear to me that
Bitcoin stands alone. And then we were
looking for competitive and America first
sort of reasons to clarify, you know, the
rest of crypto outside of Bitcoin. Right,
right. So, with like Bitcoin treasury
companies, obviously that's a very new
concept. What have we learned in the last
four or five years? How long has it been
since it started? Yeah, so halfway through
2020, August of 2020 is when MicroStrategy
at the time, now Strategy announced that
they were acquiring $250 million of
Bitcoin for their balance sheet. And it's
been quite the iterative journey since
then. You know, they continued to buy
Bitcoin from their cash reserves. They did
a tender offer to give existing
shareholders an exit if they did not want
to continue with the company as a
shareholder with this new Bitcoin
strategy. Strategy then took out
convertible debt. So, it's an instrument
that converts from debt into equity at
different price points. They used that
instrument to acquire additional Bitcoin.
And then with the invention of the
preferred equity products, they're
literally, you know, IPO-ing a product and
then selling additional shares into the
market at $100, buying Bitcoin with that
$100 per share and paying out a yield.
Currently, Strategy is at 12 or 12.5%.
Sorry, 12. And then 12 or 12.5% Strives at
13%. And, you know, the bet is that
Bitcoin is going to go up more than 12 or
13% a year. So, you can pay out that
dividend. In Strives' case, they're paying
it out daily, every business day, and
buying Bitcoin with it. And then, yeah, as
we kind of get into the financial
engineering, it's becoming clear to me
that there
may be just a few leading companies that
have really large Bitcoin balance sheets
like Strategy, where they have, you know,
I mean, by the end of the year, they could
potentially have a million Bitcoin on
their balance sheet. Yeah.
And so, it's just becoming clear to me
that the preferred products
as they are beggining to really take hold
and, mature and season
that you can continue to see what Strategy
is done in the past what Strive is currently
doing which is buying some weeks billions of dollars
some weeks tens of millions or hundreds of millions of dollars
worth of Bitcoin
with the intention to largely never sell
the Bitcoin. So, you see different
concepts, several additional announcements
from companies that are going to acquire
cash flow positive businesses, or similar
strategies to then use that cash flow and
buy Bitcoin. And that's an excellent
strategy, but I don't think it has the
scalability that something like digital
credit might have. So, yeah, it's been
really interesting over the past several
years to see how all this is developing so
far and, you know, which companies are
sticking with the strategy and which
companies, for different, very, you know,
reasonable and legitimate reasons, are
saying, you know, maybe we need some of
this capital for our operating business.
And so we are no longer in the Bitcoin
game. So, yeah, it's it seems to be very
early. It most certainly does. And like
I'm noticing this criticisms kind of
coming from all ends. There's criticisms
coming from Wall Street who may not
understand Bitcoin very well. And this is
just kind of this play is, you know,
blowing their mind. And then there's also
criticism coming from the Bitcoin
community who basically, you know, that
tension between Main Street and Wall
Street, they never wanted Bitcoin to enter
Wall Street essentially. So how have you
seen that space evolve and where do you
think it's headed? Great question.
The Bitcoin purist or Bitcoin maximalist
view of not wanting Wall Street to enter
Bitcoin, Bitcoin, I can understand from an
ethos perspective and a cypherpunk
perspective. But I think it's short
sighted to not realize that for Bitcoin to
continue along the adoption curve, that
you're going to have companies and
countries and institutions very slowly at
first, but adopt the asset. And as far as
Wall Street looking at it and not
understanding it, I think we are early.
But, you know, during the peak into last
fall of last year, 2025, I remember
walking down the street in the evening
here in Manhattan and hearing, you know,
finance people talking about debts, right,
digital asset treasuries and almost like
the meme subject of like the cool thing of
the moment. So I think the more products
that retail investors and institutions see
from ETF products to the public equities,
you know, the better for Bitcoin because,
I mean, of course, the digital credit
aspect of it, when you're able to tap into
the fixed income space and they just want
that, call it 10 to 15 percent yield, if
you can give that to them and take those
proceeds and buy Bitcoin, then it sounds
like it's a win-win for everyone. But it
is fairly complex and it is extremely
early. As I talk to some of the, you know,
executives at these companies, it is
something that they have their teams
looking at while the markets are open
every moment of every day. And just, you
know, we can talk in broad strokes about,
you know, issuing additional shares or
not, but it really does, for some of these
things, take that very traditional finance
background and mindset to be able to think
through all
of the different players in the
traditional markets that may be trading
your stock on a very, you know, high
frequency, might be shorting your stock.
And so there's a lot of game theory that
is really interesting to dive into that we
talk about on the hurdle rate that I do
with a couple of the executives from
Strive that the guys on the True North
podcast talk about. You know, it's, you
know, sometimes an hour or two of just
putting a spreadsheet up on a screen and
talking through it, which some of it, you
know, is like, you know, I have to listen
to it twice to really kind of think
through the mechanics of some of it. And
so it's really, really fascinating and
maybe more fascinating the more that you
enjoy finance and the engineering aspect
of and the technicals of game theory and
finance and everything coming together in
this very fast-paced digital economy.
Yeah, I'll definitely drop that in the
show notes for any finance nerds that want
to geek out. But I want to talk a little
bit about like the customer of, so
someone, an investor, who is not
necessarily wants to own Bitcoin as a
bearer asset, but they just want price
exposure to it. Why would someone choose a
Bitcoin treasury over like a Bitcoin ETF?
Great question. The ETF gives you one-to
-one exposure to the price, but not the
asset. So if you buy a share in the
Fidelity or BlackRock or Bitwise or other
ETF product, you're really just one-for
-one matching the price action of Bitcoin
for that time period that you're holding
that share. Whereas what the Bitcoin
treasury companies are targeting is, and
it fluctuates, they are looking to have
what they call amplified Bitcoin. Bitcoin,
so this
gets a little bit into the weeds because
you also have 2x Bitcoin ETFs, which mimic
twice the return to the upside or the
downside on a daily basis of Bitcoin,
Bitcoin, which we're not talking in a way
that we're giving financial advice here,
but that's more of a trading vehicle, not
necessarily a long-term buy and hold
vehicle, especially when the price goes
against you. But what the treasury
companies are endeavoring to do is to have
something around twice the volatility and
amplification of Bitcoin itself. And I
remember Jeff Walton, the chief risk
officer at Strive, recently describing, I
believe it's between 1.5 and 2 point
something, maybe 2.2x what Bitcoin is
doing on an amplified basis. So if you
think about someone that really enjoys
volatility, they enjoy trading volatility,
and they don't even care about the asset,
or you think about someone that maybe
bought Bitcoin a decade ago and really
enjoyed the ups and the downs of an 80
volatility asset. And now they're seeing
that the volatility has gone down on
Bitcoin itself as an asset. One of these
treasury companies might be interesting to
them from an amplified volatility
perspective.
Let's talk about the book value of the
company and how the value of these
companies is measured, essentially. Sure.
Yeah, it's very interesting, both to the
upside and the downside, because of the
amplified nature of these companies, that
it's not an exact science, an exact book
value of... We have a billion dollars of
Bitcoin, and so our stock price is trading
at a billion dollars. We've seen
everything from companies in the United
States, in the UK, in Japan, trading below
book value all the way up to 2, 3, 4, 10,
20, 30, 40 times book value at the peak.
And so, of course, that attracts
speculators, traders, and in some ways
looks like crypto, which is kind of
interesting, meaning things that just have
wild volatility to the up and downside.
During the past year, you've seen
companies that, when Bitcoin was going up,
they went up, and when Bitcoin went down,
I mean, the equity stock prices went down
over 90%. And so that amount of extreme
has been really interesting to follow
because you have analysts watching and
trying to game theory through, you know,
depending on which jurisdiction and which
exchange these companies are listed on,
are they going to be delisted? If the
stock price on the NASDAQ, for example, is
under a dollar for a certain amount of
time, the NASDAQ exchange will send a
letter to the issuer and say, hey, you
need to remedy this, or you might be
delisted. And different exchanges have
different rules and protocols around how
they treat that from more of a
conversation to an official letter. So the
extremes of trading at, call it 40 times
what your Bitcoin is worth, all the way to
trading at pennies on the dollar, 10
cents, 5 cents on the dollar of what
something's worth, has been very
interesting to not only see, but try to
think through. Because the reality is, if
a company had a billion dollars of
Bitcoin, but it's only trading at market
cap, a book value of $100 million or $50
million, well, of course, if they went
into the open market and sold that billion
dollars worth of Bitcoin, then they would
have a billion dollars. But that's not
what the market is valuing it at. So it
reminds me of the phrase, the market can
stay irrational longer than you can stay
solvent, or something to that effect.
Which is, so it's been really interesting
from an analytical point of view, you
know, commentary point of view, and having
the opportunity to interview a lot of the
executives in the space, all the way from
how they think about some of the new terms
that have come about, like Bitcoin per
share, MNAV, as a big one
all the way to how they think about
their treasury strategy versus their
operating business to potential mergers
and acquisitions. You know, if they get to
a certain size, would they be willing to
entertain purchasing another, you know,
acquiring another company, whether it's
for the Bitcoin strategy or for the
operating business. And so, yeah, I mean,
the True North podcast really has been
focused on just analyzing for the past, I
believe, two years, just what Micro
strategy, now Strategy, is doing. So, even
if you multiply that by the top 30 or 50
Bitcoin treasury companies, there's just
almost an endless amount of analysis that
you could do. And a lot of, like, okay, is
the market giving any value to the
operating business? And how much value are
they giving to the Bitcoin? And again,
that's not necessarily a negative or
positive statement because we've seen the
extremes of both just over really the last
two years. Yeah. So, let's take strategy
two years. Yeah. So, let's take strategy
as an example, because I didn't even know
that some of these companies traded like
20x at a premium. I thought it was more
around 3% or 4%. What was the top that
strategy did? Strategy, I remember being
interviewed for an article, a publication,
and I believe they were around 3x their
book value, right? They were printing
money and buying, yeah, I forget what the
exact phrase was, but buying like $3 of
Bitcoin for every share that they were
issuing more or less on. So, it's very
accretive to shareholders. And maybe we'll
get into it later, but this is really
becoming a two-way market, especially with
strategy coming out and selling some of
their Bitcoin toward the bottom of the
market to really show everyone from
shareholders to credit rating agencies to
other stakeholders that this is a two-way
trade, and they are viewing it that way so
that everything that they do at any moment
in time is accretive and positive to the
shareholder. And it's not something where,
you know, with their strategy's credit
rating that they've received right now,
when you really look down the details of
that, the credit rating agency has given
them $0 in value for the Bitcoin on their
balance sheet. So, when that's really the
focus of your business, that's kind of a
tough place to be. So, maybe we're early.
Yeah. I do remember when they sold 32
Bitcoin, they made like news around the
world, and that was kind of at the bottom
of the bear market pretty much. And you
think that was more of like an optics
exercise to signal to their shareholders
that they can do that? Yeah. I think it
was really important to not only show the
market participants that they are now
viewing it as a two-way trade, but also show
It was important
for Strategy to show both the market
participants, the shareholders, the credit
rating agencies, that they're now viewing
this as a two-way trade, as well as it had
become a narrative in the market that
strategy was basically holding up the
market by continuing to buy Bitcoin. And
so that narrative largely went away when
they sold Bitcoin, and within the same day
or two, the price of Bitcoin went up
substantially. So, you know, not by $100,
but it was going up while strategy was
selling. So I think it was important to
both go away with that false narrative and
also to, again, signal to all of the
market participants that they're
willing and able to sell Bitcoin, Bitcoin
and the price of Bitcoin was not going to
fall by 25% because they were having an
outsized influence in the market. So it
showed that that was not the case, which
was good, yeah.
In your opinion, now that you've, you
know, spent quite a few years monitoring
this space, like what makes a good Bitcoin
treasury company? What makes a bad one?
Lack of conviction makes for a bad
strategy just because the volatility of
Bitcoin, even though it's decreased over
time, both from holding for a long-term
perspective, as well as messaging to the
market. It's just in the same way that
personally, if you're not looking to hold
Bitcoin for at least four or five or 10
years, it may not be appropriate to buy
it, right? So we're not here saying
everybody should buy Bitcoin and Bitcoin's
the answer to everything. It's like, well,
with the volatility, maybe it should be a
part of your portfolio if it's something
that you are able to just hold for four or
five, preferably 10 years or more.
Same idea on the corporate level. We've
seen some examples of corporate boards of
directors not being on board. And so, you
know, you can have an excited employee or
CFO or even CEO. And if the board is not
going to approve that sort of a corporate
action, then that's not really, of course,
going to become part of the company
strategy. I think the best strategy that
we've seen so far is to have a clean
balance sheet without convertible debt and
without any debt whatsoever, making the
story really easy for shareholders and
credit rating agencies and other
stakeholders to understand. And the best
example of that right now in the market is
Strive. They went public less than a year
ago. They made a very thoughtful decision
not to take on any debt, including
convertible debt. And something that I've
seen over the past few years is that
sometimes you'll see a certain financing
and see the effects of what it might be
doing to the stock and wonder, well, why
did that executive choose to take that
financing? And oftentimes it was the best
financing that was available at that time.
And so in many cases, you're able to just
kind of wait and do nothing and refinance
out of some of those, you know,
convertible debt financings and other
financings as the market comes back and
turns in your favor. But again, I think
having a clean balance sheet and in
Strive's case, you know, similar to
strategy, having that preferred product
there where you can issue additional
shares, buy additional Bitcoin, that seems
to be a very powerful message to the
market where you can hold one share, one
equity share of a company and have more
Bitcoin attributed to that share over time
by being able to accretively purchase
Bitcoin. And I think about it as not
printing money, but it's certainly the
arbitrage of you're paying out a yield.
And if Bitcoin goes up more than that,
then you're able to hold the Bitcoin and
maybe in the future do something more
active with it. But I know that strategy
and Strive have both made the case that
through utilizing their Bitcoin balance
sheet, coupled with the digital credit
preferred equity product, that is how
they're mobilizing and really viewing
their balance sheet as now an active
strategy, as opposed to taking on
counterparty risk. Michael has said time
and time again, you know, you don't want
to get wiped out. You don't want to take
on, you know, short term leverage of some
sort. And so the interesting thing about
these corporate treasury plays is the ones
that are structured to be able to both
withstand the downside volatility to
Bitcoin and also have that amplified
nature on the upside without, as you see
often on social media, being liquidated is
really one of the keys. And it's something
that, you know, I think a lot of
shareholders value, along with the
companies that are out there on a regular,
you know, monthly or even better weekly
basis, continuing to buy Bitcoin, which
very few companies have been able to do
consistently over the past, you know, six
to 12 months. Yeah. So how many companies
So how many companies
do you believe they will exist in the
future? Are we talking about like large,
specifically large ones? Are we talking
about a dozen, less than a dozen or
hundreds? I think you'll see a growing
sector and you'll see dozens and hundreds
of Bitcoin treasury companies defined as
companies that hold Bitcoin of a
significant size on their balance sheet,
meaning, you know, hundreds of Bitcoin or
thousands of Bitcoin. With that said, it
appears at present that if the strategies
and the strives of the world and, you
know, several companies outside the U.S.
have also launched preferred products or
are in the process of launching preferred
products. I believe that digital credit
preferred product strategy will be taking
those, call it five to 10 companies over
the next few years and really setting them
apart from the follow on or the next kind
of level of companies. So I think you'll
see maybe five to 10 very large balance
sheet Bitcoin treasury companies. And then
you'll kind of have the second wave or,
you know, it'll be interesting to see what
the numbers actually are. But, you know,
maybe five to 10 companies within the next
year or two can have 50,000 to 100,000
plus Bitcoin on their balance sheet versus
a class of companies that maybe have
hundreds to thousands of Bitcoin. And of
course, we're talking about, you know,
Bitcoin at, you know, $70,000, $100,000.
It's really interesting to think what will
happen when it's, you know, multiples
higher than that as well. What do you
think is holding back really big players
at the moment who have every opportunity
to buy Bitcoin but aren't necessarily
doing that? There was a narrative and a
meme maybe a year ago over the past
several years that Saylor in particular
was always buying Bitcoin at the top. And
he has said himself, I'll be buying
Bitcoin at the top forever. You know, I'll
be buying Bitcoin at $70,000 and $700,000,
etc. And I think the reality of that is
that you can make financial moves when the
market is open to you. And when the market
is open and the prices going up of the
commodity of Bitcoin itself, you're able
to have more access to the capital
markets. So to the extent that Strive has
had their product, Sata, at $100,000 most
days and they're able to buy more Bitcoin
through that program in what I think we
would all agree is a down market, a bear
market, is really constructive. The really
interesting thing is that we have seen
strategy buy sometimes over a billion
dollars of Bitcoin in a week with their
both issuing common stock shares and
preferred equity shares. But not really in
a raging bull market, if you will. So we
really have not seen digital credit in an
up market. We've certainly not seen
multiple issuers of digital credit,
referred equity products in a bull market.
And when you start thinking through the
amplification aspect, when you have the
price of Bitcoin going up and their
balance sheet is becoming de-amplified and
they have access to the capital markets,
just how quickly they might be able to
start buying a billion dollars or call it
$10 billion of Bitcoin a week. Then you
multiply that over even five or 10
companies. That could get pretty
interesting, not only for the companies
and their financial performance, but as
Bitcoin's market cap grows, of course, it
will need larger pools of capital to, you
know, not just retail buyers in order to
continue to have what people are seeing as
a really attractive, call it 30 to 50
percent return per year over time with a
lot of volatility. Yeah, on that whole
volatility angle, I know this, we haven't
had a raging bull market, at least not
since I've been in Bitcoin. And I keep
telling my friends, I was like, I just
want one. Just give me one so that I can
experience the thrill that they've all had
the chance to experience in the early
days. But do you think this last bull
market being so disappointing and
underwhelming, do you think that's made
some CEOs nervous? I think it's probably
caused some CEOs to maybe
put some Bitcoin on their balance sheet,
but not really double down. Yeah, I think
that's a reasonable argument.
And also, you know, the whole narrative of
hot money and, you know, the hot item of
the moment, there maybe can only be one
hot trade at the moment. And so, you know,
if this past year was all about the AI
trade and SpaceX going public and things
of that nature, you know, when Bitcoin
becomes the hot thing again with this hot
money, quote unquote, coming into it, I
think that I think that could be something
that with the advent of these preferred
products could have more upside than what
we saw last year. Yeah, I think it would
be really interesting to see what heights
Bitcoin will reach this cycle, because if
we get to like $300,000 per coin or
slightly above mark, that means we'll just
be second in terms of market cap will be
just behind gold. So we'll be in front of
Nvidia and in front of all of like, you
know, obviously silver. So that will be
very interesting. I think that's going to
make a lot of people very bullish again if
we get there. But yeah. Yeah, I think
it'll be interesting to see which
companies continue their existing
playbook, which companies go from more of
a passive strategy, whether that's in
capital markets or in the messaging of it
through media or both. And what new
players come on to the scene? Because
during the last Bitcoin treasury season,
you had some companies announce that they
were going to put Bitcoin on their balance
sheet. Their stock went up. Then they
never put Bitcoin on their balance sheet.
So it really takes a certain amount of
time to really see, right? OK, we have an
announcement. Are they going to actually
do it? And then, you know, really, are
they going to message on a regular basis,
not just through quarterly reports about
what they're doing? And if so, you know,
is there conviction there? Is there
thoughtfulness there? And so there seem to
be several different buckets that Bitcoin
for corporations actually did some
analysis on, you know, different segments
of the industry that could be as just like
two examples. One would be they're just
buying and hoarding some Bitcoin. It's not
an active strategy versus a company that's
endeavoring to buy Bitcoin every week
using digital credit.
Let's go back to strategy a little bit
because I want to go back to MNAV. And for
listeners who don't know what MNAV stands
for, it's multiple of net asset value. So
I vaguely recall in, I can't remember what
month it was, but let's say mid 2024
strategy was trading at MNAV of three
around there. And then it dipped to below
one. And I remember when it was, it was
trading at three that it was people were
getting like nervous what this premium was
about. They thought it was a Ponzi scheme.
They were just really like the market was
just scratching their heads. And then when
you traded below one, people were, went
the other way and they were like, okay,
well, this is doomed to fail. How, like,
how do you explain this to retail
investors? Great question.
I think it's really important. And a lot
of the individuals that I've worked with,
especially in media over the last few
years, have been very deliberate in
saying, we own Bitcoin, whether it's in
cold storage or on an exchange, but we own
Bitcoin, the asset itself. And then in
addition to that, you know, we are
interested in these equities that are
holding Bitcoin. So I think that's an
important distinction to just start with.
And then from there, there's several
different schools of thought. One is that
there's a lot of value in buying an equity
below book value and selling it when it
goes above book value. You might think of
that more as a trade. And then there's the
school of thought of someone that would
buy micro strategy stock and they want to
hold it for 10 years or 20 years, as an
example, because they understand the
volatility and maybe even the cycles. If
you want to use that term of Bitcoin and
their thesis is that the amount of Bitcoin
per share, you know, the value of Bitcoin
per share of that equity is going to only
increase over time. And the equity, the
common stock is going to trade wildly, you
know, as far as book value goes from, in
some cases, again, pennies on the dollar
to 3x or above. And so, yeah,
there's a lot to kind of analyze and be
thoughtful about.
And, of course, I view Bitcoin, the
commodity as something that I can buy and
hold, and then the equities as further out
the risk curve. If it's Bitcoin, you know,
there are additional things to consider
because there is a management team,
because, you know, the management team of
a company can decide that they're no
longer pursuing the strategy. They can
double down on the strategy. They can
issue additional shares to protect the
credit rating of a company, even if it's
short-term dilutive and not technically
accretive to the current shareholders. So
there's just a lot to sift through and
understand. And I think my hope is that as
we venture into what you might call
Bitcoin Treasuries 2.0, that there's more
and more education around it from
hopefully not a completely boring, but
somber, sober point of view of here are
the tools, here are the, you know,
available on-ramps to different flavors of
Bitcoin. And... I don't think it serves Bitcoin
And... I don't think it serves
anyone in the community to, you know, kind
of hype something up when, you know, it's
like, wow, it went from X to Y, and this
is so exciting. I mean, for myself
personally, I've always found that even
just buying, you know, $1 or one share of
something, then it's on my screen and I'm
going to pay attention to it. It's up,
it's down. And so, you know, everyone has
a different way that maybe they feel is
appropriate to learn about these things.
But I think the more that... I think
there's a way to have fun with it and be
educational about it and even try to make
money with it and be a capitalist while
still being a Bitcoiner. But I think
there's, you know, of course, a lot of
colorful personalities in the space and
definitely in the visible public media
side of it. So, yeah, that would be my
hope is that we can continue to have,
like, very constructive conversations. And
sometimes that's easier said than done if
you don't know, like, who should I be
listening to and how does this all work? I
think the fact that over the past week or
so you see strategy coming out with these,
not white papers, but almost like
institutional quality investment decks,
presentations about Bitcoin as an asset is
extremely constructive. Because then
you're speaking to whether it's a retail
investor institution. And, you know, it's,
you know, it's, you know, leveling it up
to that institutional sort of feel. And,
you know, hopefully along with that comes
a seriousness of, you know, we want to
understand this because no commodity
investment or financial what have you is
going to be appropriate or attractive to
everyone. And so, you know, it reminds me
of, you know, I have a background in land
and energy and a little bit on the private
equity side of managing capital. And when
I was presenting one of my projects to a
chief investment officer of a family
office and was asking for some early
feedback, he said, you know, I think that
was, you know, your presentation was good.
But if you're going to talk about the
benefits of what you're doing, you also
need to call out at least a few, like
during your presentation of the risk
factors. Because if you don't, it just
comes across as disingenuous. Like you're,
you're, maybe you're trying to sell
something and maybe you're doing it in
good faith. But, you know, if we're, you
know, we can talk about memes and how
volatility is vitality and that's great.
But, you know, I think it's important to,
to be balanced and in a way that people
can see the professionalism or at least
the thoughtfulness around an answer
instead of something that more so
resembles speculation or, or, or something
on that end of it. And, you know, there's
a, there's a place for, for everyone from
very conservative investors to
speculators. And I think that's, what's
really interesting as you have these
different factions of Bitcoiners, right?
Store of value versus using it as a medium
of exchange. You know, maybe it will be
all of those things and more as it
continues throughout its adoption curve
and adoption journey.
But one thing I find really interesting is, um, do you
have any insider knowledge in terms of how
these internal investment teams, like the
CEO, the CIO, the, at the CFO, how do they
have conversations around Bitcoin? Are
there particular models that they're
looking at? Um, how are they actually, um,
how are they looking at Bitcoin internally
to value it? That's a really interesting
question. I'm not as thoroughly
experienced in, you know, what, like
several different data points to really
thoroughly, accurately answer your
question. Um, but from, you know, what
strategy has just put out, um, I know
notes and, and, uh, reports analysis from,
uh, traditional banks, from companies like
Galaxy, you know, institutions in the
space, um, that, you know, really looking
at the historical volatility. And modeling
that into the future is something that,
um, several of the Strive executives have
talked about when they're modeling out.
Even if we buy Bitcoin, um, even if we buy
Bitcoin, as an example, and would have to
sell some of the Bitcoin in order to pay
the dividends, you know, would that model,
um, work? And, you know, step through it
sometimes on a podcast and say, you know,
even if you slice off a little bit of the
Bitcoin to pay out dividends in that
digital credit model, that it, uh, it
actually still does work, um, with your
thesis being that Bitcoin's going up by 30
% to 50% per year, um, with volatility. So
I think, uh, yeah, I'm, I'm not entirely
sure how every single, um, treasurer or
CIO, um, views it. But, um, I see,
especially with the Strive team that, uh,
and, and, uh, hopefully all of the Bitcoin
treasury companies that, you know, you
have executives that have conviction in
Bitcoin. And I think it is very apparent
when, uh, you're able to sit down and talk
to some of these executives that, um, like
Michael Saylor, that they don't just have
conviction. They have deep conviction in
the long-term store of value, um, aspect
of, of the asset. And they've taken the
time to study the history of money, study
history itself, study macro, study, uh,
interest rates and the financial markets,
um, in the U.S. and, and beyond to try to
be thoughtful as to, you know, what can we
do in the U.S. markets? Um, how, how is
that most advantageous? But also how do we
export it? Whether it's, um, going and
launching a product in a different country
or whether it's, um, a company in one of
these jurisdictions in Europe or Australia
or beyond. Uh, uh, uh, you know, launching
one of these Bitcoin treasury companies.
Yeah. Unfortunately in Australia, we had
one launch in 2024 and, uh, our Australian
stock exchange has this weird cash box
rule, which doesn't allow you to hold cash
like products up past a certain threshold.
I think it was like around 30%. So the
company, which is locate technologies, I
interviewed their CEO in one of my podcast
episodes, they actually had to move to the
New Zealand stock exchange because the
environment was a lot more favorable to
them continuing to do what they wanted to
do with Bitcoin. So that can be a great
lead, um, into the question. It's like,
obviously the U S is leading the way
globally. Do you see any other countries
as kind of worth looking at that are
interesting? I think there's, um,
many jurisdictions, um
that will have Bitcoin treasury companies
that are, um, doing the right things for
the right reasons and may even, you know,
have a great story over time. Um, largely
because of Bitcoin itself. I mean, uh,
I've, I've heard several times that, uh,
you know, if you want to start a business,
you know, maybe take out some additional,
you know, financing, raise some additional
capital and buy Bitcoin with it. That way,
um, the joke kind of goes, if, if, if, and
when the business doesn't work out, at
least you still have the Bitcoin. So, you
know, I think, uh, you know, my view is
Bitcoin, such a powerful commodity, such a
powerful asset and technology in and of
itself, that even if some of the operating
businesses, um, these of these public
equities, um, you know, don't grow the way
that the executives want, or they go
sideways or something crazy or unfortunate
happens. Um, you know, I think the, I
think it'll be still a great story in so
far as, um, not only is everybody a genius
in an up market, we've all heard that
phrase, but, um, Bitcoin itself will, will
really do a lot of the heavy lifting as it
continues to, um, appreciate and value.
Let's talk about tokenization of
stocks. What trends are we seeing there?
Tokenization is super interesting because
you have, um, the tokenization of real
world assets that right now is standing
around $38 billion, but the actual, um,
equities, uh, meaning stocks and, and
similar products. There's only about $3
billion, uh, that are traded on a daily
basis, which of course means we're
extremely early to tokenizing, um, some of
the observations and research that I've
seen tends to lean toward, uh, companies
that tokenize their stock. Um, and then
the owner of the stock, um, and then the
owner of the stock takes self-custody of
the stock. Um, and it, it, it seems to be
good for the performance of the stock
because in that situation, and it gets a
little technical, um, so I'm not going to
do the best job explaining it. But
basically if you take self-custody of your
tokenized stock, um, it eliminates the
ability for market participants, market
makers, um, whoever the institution is to
short the stock. Um, so I think one of the
themes that we'll see, um, um, to the
extent that these Bitcoin treasury
companies, um, elect to tokenize their
stock could be that they really, um, rally
their community around the aspect of self
-custodying their tokenized stock, um, in
order to help the performance of the
equity itself, which could be really
interesting. Can you explain that in a
little bit more detail? How would it
eliminate the possibility to short the
stock if it's tokenized? I thought
shorting was more related to like your
betting on certain prices. So when someone
shorts a stock, they need to, um,
acquire the stock in order to short it,
they need to have that position. And so,
um, investors that I know that have larger
positions in, uh, certain equity, they
will sign agreements with their brokerage
house in order to earn interest on their
shares being lent out. And if the shares,
um, are not returned to them, then they
get that amount of cash, um, deposited
into a designated bank account. Um, but
most of the time, the majority of the
time, the stock is lent out and then
returned to them and they earn sometimes a
pretty outrageous interest rate on, on
lending out their stock. Um, so from that
aspect, um, um, you have, and I don't know
what would make a meaningful difference,
but if you had, um, a lot of shareholders,
um, not allowing the stock to be, uh, to
be lent out either, um, because they're
disallowing it, um, or because they're
taking self-custody of it. Um, and then
they can elect through that process, um,
to not allow their stock to be lent out,
which would, uh, decrease the amount of
shorting of the stock. So I think there
are probably dozens of other implications
potentially that we haven't really seen.
Um, and even if it's just, you know,
impacting the, um, the amount of shorting
that can be done on a stock, I mean, that,
um, could create just a very different
market environment specifically for, um,
the Bitcoin treasury companies and other
digital asset companies.
so you've mentioned, I think twice during
this conversation, you've mentioned the
word money printing. And I know some of
the criticisms that come from people in
the Bitcoin community is that what these
Bitcoin treasury companies are doing is
akin to money printing. What are your
thoughts and comments on that? I think
more so of the phrase, it's like they're
printing money over there. You know, one
of the, um, firms I, I used to work for,
one of our colleagues came in and
afterwards he said, wow, you know, that
business is doing so well. They're just
printing money over there. So I think of
it more as, um, you know, it's an
interesting opportunity. It's, um, it is
an actual, uh, financial opportunity, um,
less of printing money from a diluting,
um, or stealing, um, value from someone.
And more so of, um, if someone is in the
market and wants a yield of 13%, um, and
they're willing to, um, accept that
income, uh, as an investment. And on the
other side of the table is someone that is
willing to wait several years, maybe even
four or five, 10 years on a longer
timeframe for the appreciation of an asset
that they're able to acquire, um, in that
trade. That's, that's more so, um, how I
think of the, and, and I think to answer
your question directly, um, you know,
printing money, it's, you know, when you,
when you're issuing stock. And, you know,
capital is flowing in, it can kind of feel
like, wow, how did this company raise a
billion dollars in a week to buy more
Bitcoin? It's like they're printing money.
I think it's more of a turn of phrase than
anything, um, at all similar to the
government printing money and devaluing a
fiat currency.
Um, before we
finish up, do you want to tell me or my
audience why you started your podcast?
Sure. It was very much, um, meeting people
and one thing leading to another. So, um,
the gentleman who introduced me to
Bitcoin, um, encouraged me to interview a
few of the, uh, individuals that were
really studying and commentating on
microstrategy back in 2024. Um, and when I
had started the podcast in September,
October of 2024. So about two years ago,
uh, there was a lot of interest. And so
the first couple of episodes, um, led to
more guests and, and it was just kind of
like one thing led to another. So, um, it,
uh, you know, at that time there were
really only one, two, maybe three
companies that were really, uh, talked
about in the space. And so, um, I don't
know that I thought in the beginning that
it was something that was going to take
hold and be something that, um, we would
really be, um, I thought we'd be following
it, but I don't know that I realized that
it was the, you know, the beginning of the
very early innings of the next frontier of
finance between the Bitcoin treasuries and
the, and the digital product innovation.
Well, thank you so much for your time, Tim
Love this conversation. Um, let me
know if you've got any final thoughts for
my audience. Drink water, stay calm and
buy Bitcoin. Thanks so much. Thank you.