Man Who Owns 4% Of All Bitcoin: His Final WARNING To Everyone Who Doesn't Own It | Michael Saylor

0:00 I used AI to make 15 billion dollars last year. >> You did? >> I did because the AI gave us a solution to the problem that no one had ever encountered before in the history of the world. And so my advice is don't try to outwork the robots. What you want to do is ask the AI to do something that's never been done before. And if you want to create these incredible success things, you want to locate the magic opportunity. I know this because I'm a technology entrepreneur and [music] we're the biggest buyer of Bitcoin in the world. So, what is my mission? I'm preaching the gospel of digital empowerment [music] and Bitcoin is digital money and it's going to be the best long-term capital asset and you can actually own something and someone more powerful than you can't take it away from you. >> What you mean they can't take Bitcoin

0:46 from you? >> So, this is a stack of currency. You walk through an airport on this, they ask you if you have cash, they just take it. So cash in a physical form is a problem. So what do you do? You put it in a bank. So the bank then decides whether you get to keep it and whether you get it back. But I could move a million dollars of Bitcoin from here to anywhere to London to anywhere in cyerspace in a few seconds. So the last thing in the world you want to save is money. >> So what about this? Why not just put all of my money into gold? >> Well, gold is up 12% a year, but Bitcoin is up 33. >> What about the S&P 500? you're going to get double the performance from BTC that you would get from like the S&P index. >> So, should I buy a house? >> I will tell you why you shouldn't buy a house. >> And then you sold a bit of Bitcoin recently after telling a lot of people

1:32 sell a kidney if you must but keep the Bitcoin. So, why did you sell the Bitcoin instead of your kidney? >> Because Michael, beyond just buying [music] Bitcoin, what is a good strategy to build and become wealthy in your view? And then you [music] have 10 rules for young adults building a strong foundation for their life and career. So, let's go through these. So, first >> this is super interesting to me. My team given me this report to show me how many of you that watch this show subscribe. And some of you have told us according to this that you are unsubscribe from the channel randomly. So, favor to ask all of you, please could you check right now if you've hit the subscribe button if you are a regular viewer of the show and you like what we do here. We're approaching quite a significant landmark on this show in terms of a subscriber number. So, if there was one simple free thing that you could do to help us, my team, everyone here, to keep this show

2:18 free, to keep it improving year over year and week over week, it is just to hit that subscribe button and to double check if you've hit it. Only thing I'll ever ask of you, do we have a deal? If you do it, I'll tell you what I'll do. I'll make sure every single week, every single month, we fight harder and harder and harder and harder to bring you the guests and conversations that you want to hear. I've stayed true to that promise since the very beginning of the D of Co, and I will not let you down. Please help us. Really appreciate it. Let's get on with the show. [music] Michael, because of your success as a technology entrepreneur, you are a multi-billionaire from my math and you're heavily focused on digital currencies at the moment, specifically Bitcoin. What else do we need to know about you in terms of what you've built and accomplished outside of that? >> I always wanted to make a technical

3:05 contribution. So, the the early business was business intelligence. So how do you extract intelligence from large raw data sources and that was what micro strategy did. We created a global business intelligence company and [snorts] I think in 2020 when the co lockdowns took place and the world turned upside down that was when I discovered my greatest idea and it wasn't even my idea right it it was Satoshi's idea but I I discovered Bitcoin in 2020 and the company today is $60 billion but we peaked about 125 billion so we got somewhere between 100 and 200 times bigger since we discovered Bitcoin >> and when you speak to the general public now when you do podcasts like this, what is the the essence of the message that

3:50 you're aiming to communicate to them? >> Bitcoin is uh is digital empowerment, digital capital. We're living through the digital transformation of assets and this is just as profound transformation as digital intelligence. The real profound breakthrough of Bitcoin is this idea that you can take economic energy, convert it to digital form and tightly bind it to the person, the family, the company, but the country. We can talk about how we all hate countries, but you know, the history of the world is all the weak countries getting smashed by all the big countries. So if what you're interested in in is empowerment and

4:36 fairness and equity for the small company, the small family, the small person, the small country, the weak. How do you do it? Well, you basically encrypt the money, put it in cyberspace, protect it with a private key. It's like now you can actually own something and someone more powerful than you can't take it away from you. >> There's two types two types of money there in front of you. There's dollar bills and then I've got a couple of Bitcoin on the table. What you mean they can't take Bitcoin from you? >> Okay. So, this is a stack of currency. You walk through an airport on this. They ask you if you have cash. If you do, they just take it. Cash in a in a

5:22 physical form is a problem. So what do you do? You put it in a bank. Well, a bank is uh is a counterparty. So the bank then decides whether you get to keep it and whether you get it back. You go to the bank and you ask for it back. They might ask you why you ask for it back. If you ask for that much back, they file a form with the Treasury Department. You know, if you ask for too much money back too soon, right? Someone comes knocking on your door. So the challenge with this this is fiat currency and um you hold this at the pleasure of the nation state and by not just your nation state it's like every country on earth gets to decide whether you get to spend this stuff right- which is interesting and if you want to actually transfer money to someone in another country you need the permission of your bank another bank the central

6:09 bank of their country the correspondent bank there might be seven different banks that have to decide whether the money gets from here to there. So, this is permissioned money, you know, that's uh managed by the state. And with Bitcoin, I can take a million dollars. I can actually encrypt it in a chip in a physical coin, the cusacius coin, and that's a million dollars. I slide it across and it's literally a bearer asset, you know, and so that's one manifestation of it. But you could also put it into information form. I could transfer this to you just in the form of a private key that I wrote on a piece of paper that I gave to you. >> A series of letters you could give me. >> Yeah. Or I could send you a message. I could send a text message like, "So,

6:55 good luck getting a million dollars of gold from here to London if people don't want you to move it. But I could move a million dollars of Bitcoin from here to anywhere in a few seconds." The idea was I don't want to trust Apple or Google or Morgan Bank or a central bank or a government, right? And so in the extreme case, you know, two people can meet in Africa and I can trade you some Bitcoin for your truck and I don't need the permission of seven banks and 16 governments and 32 other bureaucrats in order to buy that truck. What is it that most people, the average person doesn't understand about the nature of money as

7:43 it's sat in their bank as it relates to the debasement of it or the sort of inflation of it? Because most people think if they've got, you know, $10,000 in their bank and they keep it there and maybe getting interest on it at 4% a year, they're going to be good. >> So, this is about $10,000, I guess. Um, one acre of land in Miami Beach on the water cost $10,000 about a hundred years ago. I know this because I have a house on the water and I have the the deed of sale and it was about on two acres and it was $20,000. The entire house cost $100,000 and uh it's about $20,000 worth of land. today. Uh, one acre of land on this the same acre on the water

8:29 $10 million maybe $20 million. So, you know what happened here, right? It's the same dollar. It works out to be a,000x increase in price. So when land goes from $10,000 to $10 million, that means that the currency, the dollar, the money, lost about 7% of its economic value every year for 100 years running. If you lose 7% a year, you know, then you get cut in half, right? 10 times, right? So what do most people not know about about money? What they don't realize is that the best currency money

9:14 being a medium exchange unit account store of value, the dollar, the best in the 20th century and the 21st century, the US dollar lost 7% of its value every year going for 100 years. That's the best it's ever going to get. It's not that good for everybody else. If you go to most other countries, they lose 14% of their value. And so they collapse in about 30 years. So what you have is a situation where if you store your wealth in currency in in the money of the society the question really is just are you going to lose most of your money within 10 years that's the weak currencies in Africa for example most currencies in Africa you couldn't hold you your wealth even for 10 years maybe 5 years or are you going to lose all

10:00 your money in 30 years hyperinflation happened in Brazil happened in Argentina you know that's Mexico. That's most places and that's the status quo. The average fiat currency, you know, collapses in about 29 years, I think. And then the best is if you happen to be a citizen of the greatest nation in the world and you win all the wars, you're just going to lose all your money in, you know, half life is 35 years, you're going to lose your money over the course of a hundred years. >> So, should I buy a house? So, you get to the next interesting point, which is that $100,000 in 19 uh 26 in Miami Beach today would be worth $100,000. That house $50 to $100

10:46 million. So, the house is better, right? In fact, if you're trying to preserve your wealth, you have to acquire scarce desirable property. So, your choice is, do I buy real estate? Do I residential real estate? Do I buy commercial real estate? Do I buy a private company? Do I buy a public company like stocks? Do I buy collectibles? So, let me tell you why you shouldn't buy a house. Because uh there's a 2% property tax on houses in in Florida, which means that if you buy a house, you pay 2% of the value every year. 2%, you know, means that every 36 years, you actually pay the cost of the house in tax to the government. not a very good store of value because uh you're taking on a massive tax load and you're taking on a

11:33 maintenance load. But having said it, it's still a better deal than just holding cash in a bank or holding cash in a safe. You know, commercial real estate looks a bit better, right? Because with commercial real estate, you can offset the tax, the insurance, and the maintenance cost with rents. So, what really works out with commercial real estate most of the time is you buy a million dollars commercial real estate, you have a bunch of fees, you charge rent, the rent offsets the maintenance cost. You don't really make any money on the rent, but the underlying million dollars appreciates 7% a year every year. And so, you actually can build wealth with commercial real estate if you can just cover the maintenance expenses. Most people are are told that the way to build wealth when they leave university

12:20 and they get into the working world is to buy a house. So most people that's what most people do. They they get a job, a 9 to5, they take the money they get from that, they go and get a mortgage, they buy a house, and they move in. That's kind of what we're all told implicitly. Is that a good strategy to build and become wealthy? In your view, >> the only way that it's a good strategy is you're buying the house in a jurisdiction where the property taxes are manageable, then yeah, you can you can generate some wealth. But if I flip that and you end up taking a 7% mortgage and you get massive tax and massive insurance expenses, then that same investment, you know, works out the other way and it it crushes you to

13:06 death. So, a better idea generally is commercial real estate if you're if you actually have the, you know, the business acumen to to uh get in the commercial real estate business because you can pass all the expenses through to your tenants. These things are all hard, right? Real estate business is hard. Starting your own company is hard. Investing in other companies is hard. The conventional thing, the safe thing is I just put all my money in a money market and I get paid 3% and then after tax I've got one and a half%. And the currency is losing 7% of its value a year and you're just losing five or 6% of your wealth every year for your life. So that's why Bitcoin is such a compelling thing. That's why people that believe in Bitcoin are passionate about

13:53 it because the average person shouldn't have to be a real estate expert. They shouldn't have to be a tax expert. They shouldn't have to be capable of launching their own restaurant or bar or bakery. You shouldn't have to be a stock picker. Why shouldn't the typical person just be able to take their money, put it into an asset which appreciates in value 15% a year, and they don't have to worry about it? >> What about the S&P 500? they could just put it into the stock market, right? >> Yeah. John Bogle's real contribution and the success of uh the S&P 500 is this idea that currency is not a store of value. Real estate is illquid and scary and difficult and inefficient and high maintenance. So what is the liquid

14:39 capital asset that I can I can buy? And it turns out to be like SPY. It's just the S&P 500 in the form of an ETF. So that has returned 15% over the past 6 years over a 100 years maybe 10% something like that >> every year >> and if the US dollar is losing 7% of its value in scarce desirable terms over the course of a 100 years and you're getting 10% you're getting a 2 or 3% boost and return for accepting the volatility uh of being invested in the stock market but it's not a bad idea right it if you want the conventional best idea to preserve your wealth without taking on individual, you know, corporate risk and individual real estate risk. I just buy the S&P index

15:25 and wait. >> What about this? >> This is gold. >> Yep. >> Why not just put all of my money into gold? >> It's not an awful idea to buy gold. Gold is up um 12% a year for the past six years. So whereas the S&P is up 15, gold's up 12, the NASDAQ's up 18, Bitcoin is up 33. Okay. So generally if you look at the world and you say where do you want to save your money, you want to buy a capital asset, gold's a winner, S&P's a winner, diversified tech stocks are a winner, Bitcoin is a winner. Now you're going to say to me, well then, well, why Bitcoin? Well, the answer is

16:11 if you're living in Turkey, if you're living in Argentina, if you're living in Brazil before the currency collapses or Mexico or Venezuela or any country in Africa, you don't get gold, you don't get the S&P, you don't get QQQ, you can't buy diversified real estate in the US. Those options I named are a western world conventional capital assets. So, the big mistake, don't invest in non- capital assets. Don't put all your family's money in soybeans, you know. Don't buy barrels of crude oil. Don't buy cotton. Don't invest in things that a factory or a robot or an AI can generate infinite of. You buy things that the robots and the AIs and the big

16:57 factories cannot pump out by the million gallons. And so what is that? It is maybe an ounce of gold. It is a share in the 500 most desirable companies in the world. It is one out of 21 million Bitcoin. All of those things are things that the robots are not going to create infinite of. Those are capital assets. Which capital asset is a function of where you live and what your mindset is. If you're living in a war zone, my advice is Bitcoin because you're not carrying this through a checkpoint, right? Like, you know, if if you need to go through an airport, you want something that you get to keep and take with you. You talked about the robots

17:43 there. >> Yeah. >> And uh when we say the robots, I think we mean both the the surge in robotics we're saying, but also artificial intelligence that's going to empower them to be very very intelligent. >> Yeah. How has this changed your thesis and how you view the future? Because it's it's a profound surprise, I think, to all of us that artificial intelligence is accelerating at the rate we're seeing. >> Technology fails until it succeeds. When I was at MIT, people were trying to make, you know, speech recognition work. It just didn't work. For a thousand years, people wanted to fly and it didn't work. And in 1902, the New York Times declared that every learned scientist knows that you'll never be able to fly. And then in 1903, we fly. In 2023, you know, the AI started working. You can see what's happening.

18:28 We've affected the digital transformation of intelligence, cars are going to drive themselves. It's pretty clear that anything that takes massive human labor, you know, whether it's lawyering, writing a contract, or composing a poem or composing a script or composing a book. It's like, you want a book? Tell the AI what kind of book you want. Here's my 10. You know, I want this. I want it to be set in London. I want these protagonists. Can you make it like that? Put some more violence in it. You know, Voltater, right, was impressive because he created, you know, this much literature and and when he did it, it came out of the mind of one man and that was quite amazing. And, you know, I think we're always going to admire the people that did it first,

19:15 right? But, you know, the AIS will think for us. you know, put the AI into the robot. We're not that far, right? Like when I when I sit and I talk to my voice assistant, whether it's Chad or whether it's Grock, and it's it's like she knows everything and she keeps getting smarter, you know, you know, every single week she gets smarter and it's like what happens when they go into a robot? It's like, well, you can you pretty much can imagine a billion robots and maybe we'll pay 200 bucks a month for a robot and the robot will just pretty much do everything. And so the question is, do you want someone to do everything to cook, to clean, you know, to take out the trash? Would you like a

20:00 self-driving car? Of course you do. We're on the verge of these perfect products, right? that like we'll get to the point where we're like I I you used to actually have an oven that burned things like what what it was stupid. Yeah, it was too stupid to know it was going to burn the Huh? Why didn't you just put intelligence into the appliance, right? Why why would you ever have an unintelligent impliance right at this point when it gets exponentially cheaper? We used to get in traffic accidents, right? like like the big reveal, right? The big the big inversion is when people realize that the self-driving cars are safer than the person driven cars, right? It's like you used to make

20:46 mistakes. You know, the irony of course is now when you send a message to someone, if you want to prove that it came from you, you have to actually put errors in it, right? It's like if you put errors in it, I believe you typed it. you know, the AI can draft a thing as though it had a PhD in English and it had 20 years experience as a copy editor. And so we're reaching this point where lack of of effectiveness is just laziness, right? Like if you wrote something which wasn't perfect, it's because you're lazy, not because you're not perfect. I mean, the AI create perfect documents. They do perfect research. the robots will do any amount of work. And I I think Elon makes

21:31 this point which is we're about to trip over an age of abundance. >> Do you believe that's true? What does that say about Bitcoin? Because I'm looking at some of the quotes here that Elon said about the age of abundance and he says in a future where anyone can have anything. You no longer need money as a database for labor allocation. If AI and robotics are big enough to satisfy all human needs, then the relevance of money declines rapidly. I'm not sure we will have it. If you are stranded on a desert island with a trillion dollars, it will be pointless because there is no labor to allocate. In a benign scenario, we will have universal high income, not just universal basic income, meaning anyone can have any products or any services that they want. Universal high income via checks issued by federal governments is the best way to deal with unemployment caused by AI/rootics

22:18 because AI [snorts] and robotics will produce goods and services far in excess of the increase in money supply. So, there will be no inflation. Work will become optional. Kind of like playing sports or a video game. You can go to the store and buy vegetables or you can go and grow them in your backyard because you like growing them. That's what work will be like. AI and robotics are going to make so much stuff and provide so many services that they will actually run out of things to do for the humans. Money is fundamentally information. The true constraints of the future won't be financial. They'll be energy and mass. >> He's half right. I agree with with part of what he says that is consumer goods, consumables, utilitarian goods uh will become abundant, but there are always

23:05 going to be scarce desirable goods that will not become abundant. And I I think he overstates the case. Money will still be valuable. Wealth will still be valuable. But I'll give you an example. Henry VII didn't have clean water. Did not have heat. Did not have cooling. these things the king of England did not have and technology gave all these things to the middle class and so if you live in the middle class today you know you can have your appendix out you know but Henry VII didn't have dental crowns he didn't have x-rays so you get modern medical care you know the infant mortality rate has plunged life is safer clean water clean air right clean food and technology gave them to us We stamp

23:52 out infinite Coca-Cola, infinite Hershey's bars, ice cream, right? Running water, right? Electricity. So all of those things have been given to the middle class, the working class in the developed world, right? Not everywhere, but let's say in the developed world. But everybody doesn't get a Hampton's house. Everybody doesn't get their own private jet. They don't get their own private yacht. So what happened with the explosion of affluence? Massive utilitarian entitlement. lots of cars, but you know, okay, so everybody gets a car, but how many people get a Porsche? What happens with humanity is we always invent the luxury car? We come up with the trophy asset. And and again, uh but most people don't actually want that. They want to be able to like feed their family and not have to worry about

24:39 the bills. So all of those people, you saying that those people are going to be they're going to be good. They're not going to have to worry. I'm saying that if if your aspiration is a good life, if you want infinite food, infinite energy, infinite education, infinite entertainment, right, you're probably going to get it. My point is in theory, right, why does money matter today? Because everybody, you know, has electricity and water because people want to buy something more than water. By the way, water is the proletarian drink. >> What does that mean? >> It means that if you go to a restaurant, you don't and you can't afford anything else, you ask for a cup of water, right? [clears throat] And then if you have some more money, you get yourself a Coca-Cola or a soft drink and that costs

25:26 five bucks. But if you have more money, you buy yourself a vodka. And then when you have more money, you want to buy yourself the specialty high-end tequila. And eventually people find a way to spend $38 on a drink. And uh you know in New York City, you know, you can see that everywhere. Why do we go to restaurants and pay $300 to eat at a restaurant because you can actually feed yourself on three bucks a day? And the answer is there's always going to be a hierarchy of affluence and people are going to find things to aspire to that will be more than the utilitarian mean that everybody gets. If I give you a universal healthcare, people want private healthcare. If I give everybody a house, someone's going to want a house twice as big. Everybody's always going to have a

26:12 reason to want something more, you know, >> because we're status orientated animals. >> That's the cynical way to look at it. But the other way to look at it is I wanted to be sitting on a mountain peak skiing, but not that mountain peak because the snow's not good on that mountain peak this week. >> And it's too busy on this one. >> Yeah. And that one's too crowded. you know, it's like there there's always going to be some exclusivity. You know, there's going to be a quest. So, I I think that money's not going away. I think it's pretty obvious if you look around you that that uh people still need money. It is true that the basic needs in life, basic transportation,

26:59 basic energy, basic health care, all of those things can be manufactured in quantity and they'll get progressively cheaper. We'll call them consumer goods. If this uh knowledge work does become, I guess, taken by the robots and the AIs, there's some people say there's going to be new jobs created and everyone will be fine. But it's not clear to me that there will be enough new jobs created in a period of time um to satisfy the demand of people to have something to do professionally. It used to be everybody was a farmer, right? And then all of a sudden in America, we have new jobs like called accountants and lawyers and film producers. You're a podcaster. Your job didn't exist 20 years ago. It did. You know, the job description did not exist. The business did not exist. There's a

27:44 lot of things that exist today. Yeah. I there are people that make a living putting on makeup and clothes and posting on Instagram and that was not a job that existed 30 years ago. So there'll be a lot of new jobs. There'll be dislocation. There's going to be political unrest. What do I think? I think this is the best argument in favor of encouraging a free market and allowing uh liberal uh unregulated businesses to prosper because if you have a progressive society and by the way the United States is sort of more progressive >> define progressive in this context >> you're allowed to start a business you're allowed to sell a product it's not illegal to to create a

28:33 But you you can't do what you're doing in Cuba, >> right? In North Korea, you couldn't do it. >> I read something crazy last night about driving autonomous cars. It said lawyers are trying to stop block EVs because these particular lawyers make a lot of money from litigating car accidents. >> We wouldn't want people to not crash. >> Yeah. >> Like Yeah. So the point is there are all sorts of laws and restraint of trade like you can't have an Airbnb in the face of modern technology. If you have modern technology and it's creating dislocation if your goal is to embrace the technology create maximum productivity and then minimize the disruption and the inflammation then the more degrees of freedom you

29:18 offer the less pain there'll be. Because in a more free society, you're going to have 10,000 new kinds of businesses pop up or 100,000 new business opportunities that no one conceptualized. And they'll be threatening to the status quo, but they'll be rational and they'll create value. And then they will create gainful employment and they'll create wealth for all the people that are displaced, right, by by the technology. >> Steve, what you doing? Uh, just making myself a delicious coffee >> from the freezer. >> From the freezer. Have you not heard about Contier? >> No. >> Oh my gosh. This is going to change your life. A couple of months ago, the founder of this business called Matt sent a big shipment of this coffee to

30:06 our office in London. What most people don't know is that the processing of coffee takes out a lot of the taste. So, what they do is they flash freeze it at the optimal moment when it's most tasty. And they send you in the post the coffee in these little frozen ice cubes. Now, Matt sent a big shipment to my office. I moved it to the kitchen. I said to the team, "Knock yourselves out." And then I saw so many messages in our Slack channel of people going, "Oh my god, what the hell is that? It's so delicious." All I have to do is pop it out in the morning using the little button on the back of this thing. I pour my hot water in and I mix it and that is done. You can get $30 off your first order of Cometier coffee if you go to cometier.com/stephven. try it and please Instagram DM me, LinkedIn me and let me know if you love

30:52 it as much as I do. One of the things you've heard me talk about quite a lot over the last couple of years, and this is something that's true in business and content, but also with everything in life, is that consistency is the thing that really, really compounds. The same is true in sales. When your team is small, consistency happens naturally. The team knows of every deal, so nothing gets missed. But as I've experienced, when you grow, this starts to break down, and deals start to slip. Follow-ups don't happen. Leads go cold. That shouldn't have. And when this happens, a lot of leaders look at it and think they have a people problem. When actually it's a systems problem. The businesses that I've watched scale well commercially all have a system their team uses every single day. And for my team, that system has been our sponsor, Pipe Drive. It's an easy to use intelligent CRM tool for growing sales teams that gives you visibility of every

31:38 deal in your sales pipeline at every single stage. And it shows you what needs to happen for that deal to move forward, all in real time. It's what keeps our commercial operation consistent when we were a team of five or when our commercial team was a team of 50. Over a 100,000 companies are already running their sales on it. So, if you'd like to join them, sign up at piperive.com/ceo where you'll get an exclusive 30-day free trial instead of the usual 14 days and there's no credit card needed at all. Head to piperive.com/ceeo. You know, earlier you were talking about how you can get AI to write a book. I was thinking as you were saying it, the interesting thing is I now ask my AI um what book I need to read and to make that book for me versus being prescriptive to it and because it has this huge memory on me. It knows what

32:24 I'm dealing with. It knows the businesses I'm building, the problems I have. And so I just say what what do I what's the question I should be asking you? Which book should I be reading? And then can you make that book for me? Make it 20 pages. is I like it in this particular style cuz it's my favorite style of author and then I want to download it as an MP3 file and listen to it on my way to work. I have 43 minutes. Could you say what should what's the question I should be asking you? Yeah, you're you're using you're using that as an example, but at the end of the day, you have to govern the state space. For example, anybody could say what question should I ask? But the real issue is what's the what are the input constraints? If you're a baker in Nigeria in Logos, >> okay, >> right? There's a certain set of conditions that are different than if you happen to be a fireman in Los

33:11 Angeles. >> Yeah. >> Right. And so what's the state space that you're exploring in order to create a contribution? And uh I I'll give you an example like um I used AI. I used AI to make $15 billion last year. >> Is that true story? >> This is true, right? >> You did? >> I did. Yeah. >> And I used an AI to make $15 billion in a way that no one would ever conceive that you could make $15 billion. >> This is a true story. >> Okay. Yeah. Let's let's go back to me in 2025. We have a company that has billions of dollars of Bitcoin, uh, $30 billion of Bitcoin. We want to actually raise capital to buy more Bitcoin. We maxed out the equity markets. Uh, we became the largest issue of convertible bonds in the in the world and we maxed out the

33:58 convertible bond market and and uh that was our journey in the first five years of our Bitcoin. >> To simplify this for Jenny and Dave, you borrowed as much money as you could from traditional means. >> Yes. >> Okay. Yeah. >> To buy Bitcoin. >> Yeah. >> Yeah. By the beginning of 2025, we had issued as many convertible bonds as you could issue. We were the largest issuer in the world and it wasn't scalable. So, we needed to invent a new type of security, a new type of credit instrument that we could use to borrow money to buy more Bitcoin. So, we went to the AI. I went to the AI and I started exploring how do I design a preferred stock? And so, I said, I think I want to create a security that's not a common equity and I don't want it to be a bond. I want it to be some hybrid in the middle. A preferred stock, you know, for the layman, it's it's just a

34:45 security that could be anything. You can give it any terms. I can sell you a preferred stock and give you the right to put it back to me in 12 months and it looks like debt. I can give you a guaranteed coupon on it. I can give you conversion rights and and make it look like equity. So, we used AI to design a a convertible preferred stock called STRK. when we did it, no one had ever created a preferred stock uh that was backed by Bitcoin before and uh and we'd never issued it. And so it was kind of a combination of financial engineering and digital asset engineering and legal work and securities law. So we built it and uh and you know when we asked the lawyers and the bankers, they're like, "Well, no one's ever done it before." Okay? And you know their their answer by

35:31 the way is no one's ever done it before and people don't do that. So, we don't think you should do that. And we're like, well, everything else that people have done, we've maxed out. And so, we're kind of at the point where our growth is going to stop unless we find a way out of the box. So, we're going to have to do something no one's ever done before using new technology, right? We're using digital capital, we're using uh digital intelligence, and we're using a digital treasury company. So, three new forms of something in order to create value. And uh after we done three of them, we decided what we wanted to do was create a short duration credit instrument, one that would be would trade stably around $100, around par. And we're trying to

36:17 figure out how do you get a preferred stock to trade at at a stable level. It's what what you would call technically short duration credit, but it's like we're trying to create a money market type instrument where people can buy it at 100, sell it at 100, collect the yield, and not worry about it trading up and down or being sensitive to interest rates. Well, if you do that, you have to ver in order to get it to trade stable, if you want the price to be stable, you have to change the dividend rate. And so, we created an instrument that where we could tra change the dividend rate every month. Now, had anybody ever done it? No. In the history of the world, no one ever created a variable dividend rate preferred stock. Is it illegal? No. Why has no one ever done it? No one ever had a reason to do it. They never thought to do it. The lawyers, the bankers, the

37:05 conventional investors, they're like, "Well, we've never seen it done before. We're not sure you can do it." We go to the AI. We said, "Well, can we do it?" They're like, "Of course you can do it. Just do this, this, and this, and this, and that." Well, they said they don't like that. We'll just do this, this, this. >> Which AI? >> Chat, GPT, Open AI. So, Chbt made you $15 billion. >> Yeah. Because the short of it is we brought that IPO to market. It became a $2.5 billion IPO, the biggest IPO of the year to date. And then we put a shelf registration on it. We sold another $8 billion of it. So, we sold 10.5 billion of that instrument plus4 billion of the other instruments. So, we basically sold $15 billion of credit, which kind of equates to the company making about $15 billion. >> I'm thinking about what this means

37:51 generally for the average person listening >> because everyone's like searching for business ideas and new ideas. And you're telling me that you you can use AI now to come up with novel business ideas and solutions that are outside of the box and that would generate value for people. um you though there is it's almost like hearing that there's an arbitrage opportunity with this intelligence. I was reading something the other day that said only 2% of households have a chat GPT or AI subscription still. So do you think there is an an arbitrage there for people who go to AI now and and can build business ideas from it? If if you're an entrepreneur, right, if you if you aspire to create a business or create something of value, then it's the no-brainer is you definitely should pick

38:37 one or more of these AIs and maybe you want to become adept using multiple them. They're they're just different tools. It's it's kind of like saying you got to learn how to use a computer and you got to learn how to read reading, writing, arithmetic, right? Just basics. And then once you've done that, you you do need to have some domain expertise in something, right? The question is what are you going to do, right? You either want to create um a new product or you want to create a new service or you want to radically transform an existing product or service using AI to be much cheaper, much better. But to my mind, you know, I would try to create something magical. Like for example, can

39:25 you create something that does everybody's accounting does, you know, does the work of a million accountants and sell it for 10 bucks a month? Right? >> If you were 18 now, if your kids came to you and said, "Dad, what should I go and study at university and what shouldn't I study at university?" Would your answer be different now as we stand on the foothills of this new technology? >> You want to study the new thing, right? You want to learn the new thing. And so if you look at the history of of science, the real question is what's on the S-curve. >> On the S-curve, >> the whole theory of the S-curve is for a thousand years we try to fly and infinite energy makes no progress. You cannot fly. And then in 1903, all of a sudden we can sort of fly. And in 66 years, we go from flying 20 miles

40:11 an hour to flying 300 miles an hour. First a fighter jet, then a passenger jet. Then we have like rockets that are unmanned. Then we have man rockets and then we have rockets that go to orbit and then we have rockets that go to the moon. And so that's an example of an S-curve. But then you know what happens in the mid70s we designed the 737 the 747 and we hit a wall you know and 737 is still the primary airplane for the next 50 years. And if you look at the efficiency of an airplane from 1975 uh to the year 2025 over 50 years the modern airplanes are 15% more efficient like so what you got was a diminishing return and when you're on the scurve things are doubling every 3 years you're doubling you're doubling you're doubling

40:57 your exponential growth and then you hit diminishing returns and then you stagnate and then you stop and then things are just not getting any better. So >> let's show an S-curve on the screen and also uh the the new S-curve coming in below it. >> Like when I was at MIT, you know, everybody basically flocked to electrical engineering and computer science because that was the cool thing. And so the mistake to make when you go to school is you get at the end of the Scurve. You basically start studying something that has hit diminishing returns. And once you hit that diminishing return, no material progress may take place for 100 years. It might be that you just can't break through. Propulsion technology is the limiting factor. Like

41:43 why don't we have planes that will fly, you know, supersonic, you know, on um, you know, a tank of gas that's this this much, right? Or fusion drives. Well, because we don't. Now on the other hand, semiconductors uh started exploding and semi and semiconductor technology has continued to advance. We haven't hit that limit yet. And that's that's why so many profound breakthroughs were made in computer science over the past 50 years. This has kind of hit an S-curve, hasn't it? As a form factor, my iPhone here, you know that over since the iPhone, as you said, since iPhone like 6, it hasn't really gotten thinner, better. the battery hasn't really taken a leap forward as such. So, we're now looking

42:28 for another form factor to interface with computers. >> Yeah. You know, the iPhone 1 didn't have cut and paste >> and we didn't get cut and paste till the version three. And so, there was a rapid improvement versions 1 through six or 1 through 7, call it. And at that point, you start hitting diminishing returns. And if you were do some utility function and you were to score it on a scale of 1 to 100, you would have gone from like five to 70 in a hurry and then you would have gone from 70 to 90 over the next few iterations and then you're 91 92 you hit that limit and now if if you are starting a company right you don't create another iPhone right

43:13 [clears throat] the real question right now is uh can I create smart glasses where I have something that's like my Maui gym sunglasses. I put them on, they weigh nothing and they have the camera and they see what I see and they hear what I hear and they know where I am and plug that into AI. And in that point, I can just say, "Hey, Eve, what is that?" You know, where am I? And tell me about that. And and it's like, why do I have to type anymore? When I met um Mark Zuckerberg, he showed me the the device that's on the way from Meta. This is not a secret because I know they've talked about it publicly, >> which is just a it was just a plain wrist strap with no screen on it, but it linked to the glasses. And in the

43:59 glasses, when I looked around, I could see all of my screens and everything like that. And I and if I just because of this wrist strap, if I just click, it clicks on all the stuff. So, I was just sat here with this little wrist strap. The wrist strap again was just like a cotton bracelet, very thin cotton bracelet. And as I just looked around, I could click on everything and open things and call people insex and go on YouTube, etc. And it was just up here in my peripheral. You imagine again, imagine that on an S-curve. At some point, it's going to be a some sort of like almost like contact lens type thing that's that I can just, >> by the way, this is why you should study fantasy, right? Because they have this, right, in magic worlds, right? This is like, you know, like I just wear my talisman, you know? I have a necklace. What is it different? Oh, it makes me omnisient, all powerful, immortal,

44:44 indestructible. I live forever. Well, well, what do you have to do to make the product work? Nothing. I'm wearing the wristband and I walk and every door opens to me and stuff happens. And here's where Elon gets it right. It's like the number one engineering mistake is engineers want to optimize a part that shouldn't exist. Like, make the parts go away, right? We start on the topic of what should you study, right? It's study technologies that allow you to create magic things that your parents could never. If your parents would say that's magic, you're on the right track, right? So like how about what's better than the wristband? Just like how about you just like implant one pellet >> neural link? >> Yeah. Maybe it's a neurolink. Maybe it's uh maybe it's when I'm born there's a

45:30 slight implant and now I I hear like I can talk to the AI in cyerspace forever. >> But should you go study that because conceivably the artificial intelligence and the robots are going to be the ones that create that technology if they have a PhD and everything and that's accelerating. >> Yeah. Well, I guess we're back back to the what should you study? You ought to study digital intelligence or digital assets if you can generate you know, generate proteins, gener uh generate any kind of uh life form or enzyme or protein or the like. Maybe it's interesting, but I think um with regard to AI, you don't want to learn how to do things the AI can do. What you want to do is learn how to ask the AI to do something

46:17 that's never been done before. Like if I were to go back to school, 95% of what I learned uh I probably wouldn't want to study. >> What about a surgeon? Do you think you want to be a surgeon? >> No. >> What about a lawyer? >> No. >> Accountant? >> No. >> Driver? >> No. At some point, what you have to do is ask a aren't really answering the question yet, but you you have to ask whatever is the marginal question that hasn't been answered by the civilization. Maybe I'll take it. I I'll take that position, which is the way you create value in the world is you bring something into the world that wasn't here before. >> This is something that I've made for you. I realize that the dire audience

47:02 are strivvers. Whether it's in business or health, we all have big goals that we want to accomplish. And one of the things I've learned is that when you aim at the big big big goal, it can feel incredibly psychologically uncomfortable because it's kind of like being stood at the foot of Mount Everest and looking upwards. The way to accomplish your goals is by breaking them down into tiny small steps. And we call this in our team the 1%. And actually this philosophy is highly responsible for much of our success here. So, what we've done so that you at home can accomplish any big goal that you have is we've made these 1% diaries and we released these last year and they all sold out. So, I asked my team over and over again to bring the diaries back, but also to introduce some new colors and to make some minor tweaks to the diary. So, now

47:47 we have a better range for you. So, if you have a big goal in mind and you need a framework and a process and some motivation, then I highly recommend you get one of these diaries before they all sell out once again. And you can get yours at the diary.com. And if you want the link, the link is in the description below. There should be a button just down below here. And if it says subscribed, you're already subscribed. If it says subscriber, that means you're not yet. And if you're not subscribed, please could you do us a favor and hit that button? It helps the show more than you know. And according to the algorithm, you're someone that watches our show, but you haven't yet hit that button. Thank you so much. >> Beyond just buying Bitcoin, is there any sort of actionable steps that the working class should take right now to prepare for this robot transition that

48:33 you're talking about? >> I mean, the actionable step is is learn >> learn about the robots >> digital >> like understand digital. For example, how much content's available on YouTube right now? like >> infinite rather now >> right what can you get for free on YouTube and what can you create of value right if you're in the business of content creation my advice would be study digital channels as it's like should I go and become a stage actor on Broadway it's it's a it's a a much smaller thing Mr. beast can get 100 million subscribers. You can get 20 million subscribers. You're not getting 20 million subscribers if you do the thing

49:19 that your parents' parents did. So, I think that you want to look at digital platforms. There's there's digital communication like X or Instagram. There's YouTube and and the like, but there's also there's also digital intelligence. I >> Let's just stress test that first point a bit. I guess a lot of content creators are thinking at the moment now because of these frontier models that can produce video, content, pictures. A kid in Mumbai or Manhan where we are now can set up an agent while they're asleep and say, "Listen, just post 100 videos while I'm asleep on this every single platform. Actually, I'll make five agents and I'll ask all of them to post 100 videos each." So, you're going to have this you have in terms of supply and demand, presumably that's a supply

50:04 shock. there's this slop tsunami coming in and then if you look at demand of attention online it is arguably fixed. Financial times did a report said that young young people are actually starting to come down in terms of time spent online. >> Uh slightly older generations are starting from a lower base. They're still going up but they're starting from a lower base. So you got a tsunami slop of supply and fixed demand. >> This even this business feels a little bit insecure. Actually a lot of the major podcasters are actually down on YouTube. If I look at the top who I would consider the sort of top five podcasters in my niche, um, every single one of them is down at least 50%. In the last 20ish, uh, 12 12 24 months. >> Well, the solution is certainly not to not pay attention, right? So, for example, if you're in the business of creating content right now, you would

50:49 ask the question, can I enhance the content with AI or can I better market or distribute the content with AI? >> What is the moat? the moat's going to be the most talented content, the person creating the best stuff that everybody wants to see. There are videos being created like here's a walkth through of a 16th century warship and you know I don't know if you've seen a guy constructs the entire warship from the keel and he creates the ribs and he shows you the lower deck and the ballast and he takes you through every step and it's a three-dimensional uh video animation takes about an hour and it's absolutely riveting. I have no reason to care about 16th century warships, but I can't take my eyes off it because it's just so fascinating to

51:34 see him explain everything. >> Are you saying creativity is the mo still or understanding what humans want and then delivering it which I guess is creativity? Let's say the Led Zeppelin example. But what what you see in human history is within 10 years of whenever there's a new technology platform, there's some geniuses, they push it to the limit and they do 95% of everything that can be done and it all happens within 10 years and they live forever. So >> why didn't anybody before Beethoven do stuff with the panel? uh the piano comes out, some genius does stuff with the piano, right? And between Beethoven and Shopan and you know and a few players,

52:20 it's like it's not clear to me if humans try for another 10,000 years, they'll do much better. So with Led Zeppelin, you had electric guitars and you had amplification and everything kind of clicked late60s like the sound of the early 60s was not quite there and then by 197172 you could do some amazing stuff. And if you think about all the classic rock between 1970 and 1980 you have human creativity pushing the edge of the envelope in so many directions. And then you hit this diminishing return. And then along comes sampling, right? And then you get Swedish House Mafia and Aviche and that's new technology. And then they push it to the extreme. And then along comes YouTube and Justin

53:06 Bieber comes out of nowhere, you know, and Mr. Beast comes out of nowhere and they push it to the extreme. And what you see with every generation is I give you a new thing whether it's a piano or electric guitar or internet. Think about Facebook and Mark Zuckerberg and what he did at just about the point when you could do that with the web. And then think about the early mobile apps, you know, WhatsApp and the like. It's like what you want to do if you want to create these incredible success things is you want to locate the magic opportunity right at the right point on the Scurve where it just now became commercially viable to do it and it's a

53:51 zero to one moment and you want to be there. You want to be the first person that applies that technology, right? Uh to this new idea. Like what did our company do to to go from nothing to $60 billion or from 1 billion to 60 billion? We were the first company to take digital capital Bitcoin and put it together with digital credit and a digital treasury model. So we created a credit instrument, a security that you could never created before. or you couldn't have made it 10 years ago. You couldn't build it on top of anything other than Bitcoin. So we needed to get to the point where we had 10 or 20 billion dollars of capital and then we could create this thing that was a

54:37 multi-billion dollar thing and that becomes resonant and that window is like 12 to 24 months and you go through that window and you create something that might be a hundred billion dollar thing because you go through if you went through 36 months early you smack into a wall and you fail. And if you wait like at this point our company is 20 times bigger than the next biggest one, 50 times bigger than the company doing something similar. Did we plan it? Not at all. We found some extraordinary cool thing. We committed to it with all of our heart and soul and we declared we were going to make it work come hell or high water. And we got punched in the face a hundred times. And every single time we ran into a problem, we stopped.

55:23 We recalibrated. we went a different direction and the process of creating something beautiful like the beautiful thing like everybody wants a bank account that pays 10%. So if you can figure out how to give people this thing they want with a new technology that was impossible that did not exist 5 years or 3 years earlier then you resonate in the society right you'd go viral like we were just the first ones to get there it exploded. If you gave me a billion dollars right now and said run a marketing campaign it wouldn't be as effective like you couldn't buy the success with a billion dollars of marketing. You just have to the Led Zepp guys, they didn't spend a billion dollars marketing. You got to be in the right place, the right time, and you

56:09 have to have the courage to offer people the new thing. I have been thinking a lot about this this idea of you said, you know, if you spent a billion dollars, you couldn't go as viral as that. And if someone came along and spent a ton of money today, they couldn't go as big as, let's say, Michael Jackson. When we go back through history, I was thinking about this this idea because I watched the Michael Jackson documentary recently and he was at a level of fame that is I don't think we've ever seen since. And I think part of the reason why was because there was a constraint on the distribution channels back then. So in my house there was 20 albums over there, box set albums and Michael Jackson was like three of them. And then the other way that we could consume was the TV over there and there was like six channels and MTV was

56:55 one of them and it was Michael Jackson all day. [snorts] In the world we live in now where there's my phone experience >> is a completely different phone experience to yours because of AI. AI is learning what I like and showing me my own little version of the world. I [snorts] wonder if it's possible to be as big as a Michael Jackson once was for anybody these days. And actually I I even with the YouTuber you mentioned earlier, I wonder now if fame or or being a content creator or musician once looked like this, this sort of like high ceiling and then you're known for a hundred years like Michael Jackson. And now with algorithms that are personalized, does it now look like this?

57:41 Shorter and shallower, is it possible to get big? You could say, well, I can't get as big as Michael Jackson, but on the other hand, Elon Musk got big, right? Like like there are things that get big, right? Companies get big. Open AI went from nothing to how many users in just a few months. So I I think what you could say is going viral is about hitting a resonating frequency in the civilization whether it's an artistic frequency or it's a political frequency or it's a it's a technical frequency. Yeah, there are some things where there's going to be a glut. There's going to be well let's take Instagram, right? It's like on one hand a billion people have like bad

58:26 photos posted online but on the other hand there are people that managed to get you know 8 million followers and they you know are the Kardashians you know you have these people that get massively big and that's the other side of the equation. So I don't really know how it all plays out except for the fact that it seems clear that there is room for human creativity and innovation. And if your goal is to make a contribution, right? If you're at if you're in your working years where you want to upgrade the world and make a difference and be remembered for something, then a a pretty simple principle is

59:14 don't keep doing the same thing over and over, working harder and harder every year, fighting against the modern automation, you know, epidemic, right? Don't try to outwork the robots. It's like you're you're lamenting, you know, how difficult it is for a content creator. But let me remind you that it used to be you would go be a college professor and teach 200 students a year for 20 years and you would feel that your life contribution was 4,000 people whose minds you touched and now you get 4,000 people a second. Okay? So you're judging yourself against the next thing. But if

59:59 you look back in time, technology has given us the ability to amplify our intellect and amplify our creativity in a way that is uh unprecedented in human history. >> Yeah. I think I think in part it's I'm wondering now if we're kind of we technology said okay you can reach more people TV radio all these things and actually now with intelligence it's saying oh we can figure out exactly what Michael wants so we're starting to live in these smaller echo chambers where your creative idea or your creative piece of content reaching lots of people is going to become harder because the algorithms are now in the way and they're deciding who sees what um and they're optimizing for the the I guess the platform the the platform's monetary desire the The thing that I think is

1:00:44 really interesting and I've been mulling for the last couple of months is that that which is really really hard and scarce and actually you could say something being hard and scarce are are are the same cuz to create something scarce is also hard like you did with that financial instrument. Very few people on earth could have created that. We don't run public companies. We don't have the information etc. or even that YouTuber you mentioned who walks you through those uh the 1600s or whatever. That is very hard to do. I've theorized that actually pursuing that which is hard and scarce. Getting you to come here today is not easy. So that's kind of my moat. Michelle Obama coming and sitting down with me here is still kind of my moat. Um is is is what we should aim at. What do you think of that as a theory? I agree. Let's say you have a business, whatever your business is

1:01:31 right now, the right thing to do is to spend an intense time with the AI considering what are all the ways you can upgrade and improve the product or the service you create, right? Uh, for example, like it used to be you do this in English and the issue is well what if what about Japanese or Chinese or French or whatever and you know the hard way is you learn 20 languages and you know but then how does your guest or we translate it or you hire you know we used to spend money to hire translators but now you could have the AI translate this into a 100 languages right now the question is should you or not can I enhance it right it's interesting when someone describes something, but you're like, let's just put up a chart of the S-curve there. And

1:02:17 then the next step is, can I market it better or distribute it better? And the next step is, am I creating something that'll be valuable in a decade? Well, will it be valuable in a hundred years? >> Well, this is probably a good time to mention this. 24 months ago, we started exactly that, which was there are aliens. No, no, no, no, no. Uh Arabic me. Yeah. And ask yourself how many people that do podcast interviews offer that level of quality of content. And I think that you're I think you're outstripping like I don't know of anybody else that's done it. Neither do I. >> Right. >> We started almost 3 years ago and for the first 24 months it was a tragic failure. So you had the data scientists

1:03:03 in the corner of our office failing for 24 months and then about 12 months ago for the first time ever we saw that the translation technology underneath us had improved and that we could get the view duration in Spanish to be [snorts] higher. >> Yeah. >> Than English. >> And how many months do you think Jimmy Paige spent trying to master the electric guitar? >> More than 24 months.

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