Bitcoin outlook for 2025 with Tether co-founder William Quigley

Transcript

GM good morning welcome to the milk Road show The Daily crypto show that's fresher than new bed sheets on laundry day I'm your host Jay Hamilton and today we are joined by William Quigley seasoned investor co-founder of tether the largest stable coin in the world also co-founder of wax blockchain a leading project in Bridge technology now last time William was on the show he predicted 100K Bitcoin by the end of 2024 or we would be slightly off and he would be worried and here we are at 100K So today we're going to look into 2025 and see where William thinks Bitcoin will go by the end of q1 and throughout the rest of this cycle we're also going

to get his thoughts on Trump in power and what that could mean for banking reform in the US and why everybody is going to need a little piece of Bitcoin from corporations to nation states to investors just like yourself now before we jump if you enjoy this episode please do me a favor and subscribe or like our show it helps us get more big guests just like William also I have an important announcement I need to let you guys all know about there is a scam going around claiming that we are launching a token the milk token I want to be very clear we have no plans and never will launch a token this is a scam

so please be careful if you get this email or if you come across it leave it be do not click do not engage stay safe out there my friends as the cycle continues scams are going to become more prevalent unfortunately so please please spread the word and protect yourself and when in doubt if it's too good to be true it probably is anybody who tells you you're going to get free tokens for no reason there's probably a lie in there so be careful now before we jump in we just need to take a moment to hear from our sponsors who make this show possible meanwhile is the world world's first licensed and regulated life insurance company built for the Bitcoin economy they do everything in BTC you pay in BTC they pay claims to your

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designed specifically for micro strategy stock position yourself with Precision with T-Rex you gain access to power powerful tools for sophisticated investors William welcome back to the milroad show hey good to see you yeah great to have you okay let's start with last time you're on the show as I mentioned you predicted 100K Bitcoin you actually specifically called out December 10th as a date that you would be watching I'm not sure why you called out that specific date at that time but uh you obviously are very Avid in watching past PS and identifying how patterns repeat themselves tell us how do you

feel about where we are and how the pattern is looking so far in this cycle for Bitcoin well as we talked about last time I thought Bitcoin um needed to continue the pattern that had followed previously in previous capitulations uh happenings happen in May or April or May you have capitulations in August or September kind of goes flat and then starts to ramp up in Q4 and that sets it up for a nice bull market in the following year in this

case 2025 and uh that's precisely what's happened uh we had the capitulations in August and September and then uh right around November we started seeing Bitcoin take big leaps and hold those ultimately short time ago surpassing 100,000 and retreated a bit since uh but uh anywhere in the the mid90s to you know 105 110 to me is is a great sign that uh Bitcoin is doing what it is done historically and therefore 2025 will be an except year for for Bitcoin

performance and where Bitcoin goes so really do all the altcoins so that's why we want to pay most attention to bitcoin uh before we get into where you expect Bitcoin to go throughout the rest of this cycle I just want to touch on something you mentioned before we started recording uh which is that you expect there to be a pullback or you wouldn't be surprised if there was a pullback just talk us a little bit about that and why you think that's going to happen and maybe not such a bad thing yeah for a couple of reasons even outside of the context of Bitcoin um you'll always have uh individuals who are looking at where something has gone

maybe at what entry point they had and saying you know what I'm good and taking some of their profits so that alone is going to slow down the upward movement of any uh globally traded asset and then you have the impact of of uh lots of people who are sort of they're trying to time things and so um lots of people will look at the the herd and they become part of it and as you see um great momentum building you have many people on the sidelines thinking I've got to get in before whatever before is

uh uh get in before it hits 100,000 uh getting before it hits 150 and so those people um I guess I would call them they're not the hodlers okay they're they're momentum people and uh the reason why I I had said I know if it was to you but to some others that um once Bitcoin hit 100,000 uh which took what 14 years um it could hit 200,000 in four months five months and in fact it actually kind of needs to if it's going to fulfill its uh it's its role from prior patterns it needs to do that

because this um this cycle will if if we look at the his historical um patterns of Bitcoin the cycle will end in 2025 uh and so if it needs to be what I had said previously um 5x from its preh haviing um amount preh haviing was about 65,000 so 5x call it 325,000 if it needs to do that and it needs to do that before December 2025 then um by Midsummer should be kind of at the halfway point it should be Beyond 200,000 um and I've had some people say you know for it to go to$

100,000 let's say in December to 200 by March that seems impossible but uh from August to November less than four months it already doubled right so Bitcoin doubling during these bull market periods is nothing for it from on a historical basis even though it does seem wild to think about in March Bitcoin could be 200,000 um I'll make another prediction I'll say if in April it hasn't surpassed 200,000 yeah that's a concern okay so hopefully we're at 200,000 uh I love your bullishness uh

and I I'm I'm on board let's get there you said that the cycle likely ends in 2025 or not ends but peaks in 2025 uh where do you think we get to where do you think Bitcoin gets to before by the end and do you have any rough timing on when you think that Peak might be 325,000 um before the end of 2025 and it might it might do that in March you know and then Retreat and then probably before year end before year end have a nice pop again that would have been the kind of the 20 uh 20

2021 uh cycle uh so it might do that that wouldn't surprise me um I I would like it to do more than 325,000 me too yeah and I'm looking at what it what um the multiples it's achieved in previous cycles and how those multiples uh keep getting cut by about half right so as I've said you know first haveing 50x second haveing 20x third haveing 10x so you know 4 to 6X would probably be what we would say oh that's pretty consistent if it

followed it precisely and um so that's where I get the five and if there the other factor that pushes this is is Bitcoin is obviously incredibly volatile and and um with ETFs it's easier to hold but it's a it's a a um very new globally traded asset Right This Is Not Gold or copper right this is really a new asset so which means there's a lot of risk you don't know how it's going to behave if we had 50 years of data we'd feel a lot more comfortable than you know less than 15 and so as a result if you are going

to hold something like that it needs to deliver exceptional returns uh or else why would you ever touch it you know you don't want um uh lots of downside volatility and very little upside right that's not a good combination um and that's why um there's almost like this this compelling aspect of it uh and of course there are some people who I I think it's more a little more wishful thinking but there are those in the media and smart people who say 500,000 750,000 1 million um that

would be out of the pattern if it did that in this cycle which is the reason why I don't think it will um but again you know we don't have that much history uh less than 15 years so um it's much more uh capable of doing something we don't expect but um it makes me feel very good when I see it all of the uh patterns leading up to a solid bull market all taking place um so that's where we are now at the end of 2024 me me too it also makes me feel really good uh let's talk a little bit about the catalysts of what can get us

to these numbers so people listening and uh can understand where these come from these aren't you know random predictions that we just pull out of a hat there's reasons and things that we expect to happen in 2025 first let's talk about the Catalyst that's happening right now and that's 100K Bitcoin what what does it mean for Bitcoin to pass 100K what's the impact of that well it's the number is symbolic right 100,000 it got a lot of press and uh I think uh this is good and bad for for your audience who uh who uh trade stocks they're familiar with this

word capitulation you right and and capitulation is a kind of a scary word too what it means is the last hold out has just given up their skepticism and said okay screw it uh that's where this thing is going I'm in and the capitulation phase typically uh means that the upside is probably coming to an end because that's the last money on the sideline that moved in to the category uh we did have some capitulation or at least some apologies I saw people who have been naysayers for

like 10 years maybe and now it hits a 100 and and they're starting to feel dumb you know the PE it's like it's kind of like the people who now I'm dating myself but the people who are like there's no way that Amazon is ever going to survive you know it just it's just no one wants to do uh retail online and and and then it did collapse you know uh and after when the dotom bubble burst and for a few years it wasn't doing so good and of course it had whatever it was 15 years of operating losses but if you if you looked at the comp other metrics you could see this thing

is um stable and rapidly growing on a lot of other important metrics other than profitability and the stock market was happy to fund that well um I think a lot of people are looking at Bitcoin and saying you know this ETF thing like that makes it seem pretty permanent like like there's a lot of interest it's over a 100 B billion dollarss of of net asset value over a billion dollars a day traded um that seems like it's it's propelled itself to you know like the the most important among the most important ETFs and uh and then you look at uh how we used to every year around

the globe there would be a mixture of good and bad news often on the regulatory front usually for every positive piece of news that some country that was now Banning it or greatly restricting it or whatever like look around us um there's no meaningful country who's coming out right now and saying blockchain is bad and we are going to arrest people who hold Bitcoin you know it's um uh wherever the US goes uh for right or for wrong so does the rest of the world and with Gary gendler the chairman of the C saying he's going to step down on the day Trump is

inaugurated uh uh uh becomes president we uh we know how how anti- blockchain he was in crypto um the US with Trump's very Pro crypto policies provided he you know delivers but at least if we look at his cabinet um there are no DieHard anti- crypto people um I think the federal government is going to become much much more receptive and as that happens the rest of the world is going to do what they always do up let's follow the Americans so it's going to be very good news it would seem for blockchain and for Bitcoin in general um

through 2025 we'll have setbacks because there's always something um this time around I'm really hoping that um the dumb um Bitcoin lending platforms don't take off I'm hoping people understand uh there's no free lunch do not hand over your Bitcoin for an IOU from some sleazy company that doesn't have audited financials that that doesn't have quality management you know like like people did in the last cycle um I I hope the community kind of like attacks those types of businesses because that really

the deleveraging of that last uh last cycle was super painful not to mention of course the scam artist Sam bankman yeah no kidding yeah and and unfortunately as you said those things will happen again particularly some people are going to get scammed they know so it's just don't don't sit there and say hey because we're evolving and our Tech is improving and we have we're starting to get regulation oh it's all safe now like you really do need to be vigilant and watch out for yourself uh in our in our prep for the show you said something great to me in an email exchange we were having you said that uh

a result of 100K Bitcoin was that it forces everyone to ask the question okay should I own Bitcoin like it's now at the point where you you can't ignore it and and when I say everyone I I don't just mean retail and everyday investors I mean corporations I mean nation states and we're seeing that right now Amazon just recently a letter was produced from Amazon shareholders saying we think that Amazon should hold 5% of its Assets in Bitcoin Amazon has over 500 billion dollar in assets $88 billion in cash or cash equivalence and there's the potential now we'll see if that

shareholder vote passes or not not uh Microsoft is voting today right now as we're recording on whether they will start to buy Bitcoin on their corporate balance sheet what's the the impact of these corporations and do you expect that large corporations in the next year Amazon Google uh Microsoft might buy Bitcoin or do you think we're still too early I think we're too early I I don't think I think right now it's more of a press release phenomenon like look at we bought Bitcoin um so I've been a CFO many times I uh I would be reluctant to hold it at on my public balance sheet uh uh so

think about it this way you know you're a company and you sell whatever t-shirts and books and electronics online your Amazon um you have trained over 25 years you've trained um Equity analysts uh the people who read your 10ks and your 10 Qs and tell uh uh the investor Community what they think of this company you've trained them on the things that you believe uh Amazon should be judged by and uh it it becomes um uh after a company's been public about 10 years even better 20 years the analyst Community can get a good of okay a new

product's coming this is how it's going to affect the earnings per share and so forth and so um what you don't want as a CFO is to have this weird thing on your balance sheet that gets marked to Market and that moves up or down 5x to 0.25x and it's a meaningful enough number that it has that it's disclosed and so your EPS is like doing this weird thing and then what you're going to you know the analyst Community then needs to strip out the Bitcoin piece of it and say this is um you know earnings uh excluding volatility from so

yeah I don't think it's a it's a proper thing on a balance sheet of a big company um in this current phase uh maybe somebody could come up with an argument that I would say possibly um if you look at like micro strategy this was a company I mean I remember micro strategy when it was a private company in in Northern Virginia back in the 90s and it was um most of your audience uh they were probably in elementary school or maybe not born yet but back then um micro strategy among like the investor Community was like um it isn't

equivalent to Amazon or whatever but um but it was it was a company every might have been like a Twitter I mean people knew about it right it was this highflying software company doing a lot of like data uh analysis Michael uh sailor was uh was pretty well known and then the company had some accounting issues it crashed it disappeared uh Michael needed to figure out how do I ever breathe life back into this thing like nobody cares about micro strategy every once in a while I would catch myself thinking I wonder what ever happened to micro strategy so for him that was a um uh it was a way to get back on the map right and and he's like

screw it I'm gonna basically become a hedge fund a publicly traded block a Bitcoin hedge fund uh I at some point you might even see I suspect him split it off there'll be the micro strategy bit coin Holdings and then this operating company because if you're a CFO of that company micro strategy no one wants to hear about how the core software business is doing no no right they're gonna be like what like stop tell us about how many more bonds you're gonna issue to to buy more Bitcoin um uh so they've become a publicly traded uh uh leveraged Bitcoin Hedge fund and uh uh I think for Michael

sailor at his age especially he's like hell yeah I want to do something different right but I kind of feel like there should be split up so um that's for me on the company side I don't think it's a great asset to have on your balance sheet because people invest in companies because they believe the products or the services of that company are selling into an expanding Market with expanding margins and they've got a a good Innovation Pipeline and that's how you want to think about it you know I don't think any of us would U you know if I if if I created a competitor to Uber and uh it was a terrible service right shitty cars shitty service but um

I gave you like a cash back thing on every trip which was Bitcoin um I I don't think that would do well because I think people would just say you know I'm wanting to use you because you can take me from point A to point B I don't really care I can buy Bitcoin off an exchange so that may not appeal to the uh the Rabid Bitcoin Maxis here but um uh if you want to get into it buy an ETF um and like I said there may be an argument uh for instance coinbase You could argue that coinbase is already completely correlated with crypto so if it had a lot of Bitcoin

Holdings I don't think that would necessarily be a negative yeah do you uh I I'm not sure if you've thought at all about this but do you have any concerns around micro strategy with all the buying they've been doing they're obviously they own over 2% of Bitcoin Supply now so when we think about Black Swan events if there was an unraveling of micro strategy and they were forced to panic sell their Bitcoin that would be a really bad possible event do you have any thoughts on if there is the potential of that happening here well first I'd say um we've already lived through this before great scale

trust had 3% of BT maybe it still does you know um 600,000 or so BTC micro strategies around 400,000 so um uh I put those about in the same bucket micro strategy and greats scale trust um and it's like U yeah on the one hand 2% but if you told me um you know some investors accumulated 2% position in Microsoft I wouldn't care 20% I might go oh that's a lot so uh uh no no issues there um also um the uh uh he was he's always been

very very smart Michael sailor and if you look at the uh the way he has had micro strategy acquire the Bitcoin it's um It's a Wonderful uh uh lowrisk I dare say almost no risk um uh Contraption for micro strategy because you know they issue a bond the bonds are backed by the Bitcoin they buy which there's no like ability to do a margin call on his bonds you know it's like the Bonds mature on next date and um the uh right now of course they're

weighing the money and uh let's say the bonds matured and Bitcoin had collapsed well the it's kind of like having a u a commercial mortgage back security if the underlying mortgages on the properties uh are worthless because the properties are worthless to some extent that's true right now in many big cities U the bond holders get that worthless property right but the issuer of it is is not harmed you know that was the benefit of the bargain so if on the other hand micro strategy

had issued corporate bonds guaranteed by the assets of micro strategy and uh uh they couldn't pay back the bonds because the Bitcoin they bought didn't give them enough money to pay back the bonds and then micro strategy went into receivership and then some I hate these bankruptcy receivers they grabbed all the Bitcoin and they just dumped it at spot prices yeah but you know that would hurt us for a month and then we'd be okay again but the way he's done it has been such a u uh such a well constructed way maybe there's a flaw in it but um uh I've looked at them

and and I don't see any big risks for you know for certainly not for micro strategy the issuer of it um I bet you there's some companies out there that wish they had done that you know and the fact that Michael says you know it's going to get to a million or whatever and then he says and I'll be buying at a million too as well right and I think his 2050 projection uh is uh 13 million and uh he'll be dead by then so he's never gonna be held accountable for it it's really good when you're going to make predictions the one I made with you guys a few months ago those are stupid predictions you want to make a

prediction that's like 50 years out right you you yeah we' seen this with all the climate people it's like oh the World's Gonna meld in 20 2010 20 you know that those are bad predictions uh but um though he has made some near-term ones um so yeah I'm not worried at all about that um and it speaks to the broader thing about well uh what is going to be the impact of this this uh broadening of the buyer base of Bitcoin right so it's like oh could it become a reserve asset that that governments hold could which by the way wouldn't bother me at all because

governments aren't going to go um you know bankrupt at least not in the traditional sense uh especially governments that are allowed to print their own money they can never go bankrupt so I love the idea of the United States buying Bitcoin I don't think will ever happen to be honest but uh you don't think it'll ever happen really no no now somebody might say it's already happening because they seese money okay right the government seizes property from people and maybe under Trump uh it won't sell I don't think I'm a conspiracy theorist but um I felt like every time we would be in a little bit of a

uptick the freaking people in these federal agencies would announce they're going to sell 50,000 BTC at spot or 100,000 right I've seen it again and again and I'm like this is this to me is like um uh it doesn't seem coincidental so I wouldn't mind a four-year pause I wouldn't mind a four-year pause on um selling Bitcoin um does does the federal government need to sell it of course not it can just add a zero and and you know print more money so um uh just like it holds some gold if it's gonna hold some gold I don't know what fort KNX has like

500 billion or something of gold if it's gonna hold gold why not like why not hold some Bitcoin um um how much that would influence the price I don't know um you know you can do the math but it's the Chinese bicycle math like when I was a young venture capitalist uh we called uh Chinese bicycle math when when somebody would um say to us look the market is a billion people you know like Chinese Bic if every person in China buys one bicycle that's a billion bicycles um so it's sort of like very high level and not very deep um uh you hear this a lot if every corporation

just took 1% of their assets and yeah but I don't think they're going to um on the other hand uh I think it would be very beneficial for us if um the ETFs continue to grow and the reason for that is uh the holders of ETFs a lot of them and your audience might not understand this a lot of the holders of ETFs are retirement accounts and you say okay why would I care if it's in my Roth IRA or 401K versus uh in my whatever Robin Hood account well here's the reason because most people who acquire stocks in the retirement accounts are not day Traders

they're not even year Traders uh in fact you see constantly um education aimed at retirement account holders saying you need to rebalance at least once every 10 years right please yeah please rebalance and God knows I've been guilty of this it's uh it's this like ah it's my retirement account I'm G to get that in 25 years it doesn't matter and so those ETFs could become in the geology of the hodlers they could become those that like you know haven't moved in 10year types right which would be really good because um I haven't looked to be honest I haven't

looked in like a year but um now it's the bull market I'll be looking again but historically uh less than 10% of Bitcoin has actually been traded you know so you have like 20 million of course it's it's grown from zero but like roughly 20 million uh uh Bitcoin uh you have the four million or so that's lost forever right and then you have like uh 15 million or so maybe a little less that's that that doesn't move much in in the past three years five years so um there's this small amount that freely flows which is why it's so subjected to volatility because

there's not much right um there's not much that's available and If you have a a Hoover vacuum cleaner like a big ETF or Michael sailor just hoovering up hundreds of thousands of Bitcoin uh and you've got you know guys like me you who are h well where does it come from well there's you know for people to part ways that has to be very highly priced yeah it's uh it's very interesting that you you bring that up because uh we had uh Matt Hogan the chief investment officer from bitwise uh recorded last week this episode hasn't come out yet uh it comes out in a few

weeks it's his 2025 prediction so giving giving you listeners a little bit of a a tease here uh but one of his very interesting predictions was for the the Department of Labor has basically said said they haven't put in strict rules but they've basically said that they've made it very difficult to to get access to bitcoin three or 401k and his belief is that next year that will change and they will relax a lot of those rules and nobody's really talking about that but exactly what you're saying that's those are the type of if those rules are relaxed if these that type of fixed income investor now has access to to

purchase Bitcoin and they're very likely not going to sell it when they buy it that could lead to a lot of flows and like and flows that they're they're holding it for for the long term ju and just to make one um uh point in what you said I don't think it's the fixed income investors right I mean those fixed income are like they're the 75 year olds golfing um you know they need a fixed percentage of income uh to to fund their life um so in fact if you're asking me I would say don't you dare touch don't touch it too too volatile um but to the

other point if we could make it not only uh administratively uh allowed or or at least not filled with friction and uh educate people uh that might be the of the list of things I would say make $1 million Bitcoin uh likely that would probably be in the top three list of of things because we have 40 Whatever It Is 40 plus trillion dollars of um of wealth held in in publicly traded assets just in the US and um uh bitcoin's two

trillion uh being able to give those people exposure to to crypto which is for me which is a great place for it to be set it and forget it you know uh you're 45 years old you're like you know what I'm not going to like an idiot but I'll take um 50 basis points you know 1200th uh not even 1% one2 200th of my assets and put in the Bitcoin it is irrelevant if it goes to zero right but it could make your your um your annualized yield ultimately maybe double

right this tiny little thing so um uh you'd probably have to rebalance it at some point but I really like the idea of uh of uh people who have Investments that are targeted like 10 years plus uh so think of all the um endowments uh charitable foundations um uh uh organizations that have a mandate basically to survive in perpetuity uh you know the Getty truck it's it's got this uh you whatever the money is now when I was an auditor I actually audited Getty trust it was 20

billion it might be 50 now I don't know what but uh you know that thing which is going to be around as long as the United States is going to be around uh of course uh University endowments I mean they're the um you know the oldest institutions in the United States been around since the you know 17th century some of them they should all it there's no reason why they shouldn't and and um essentially um any limited partner that a venture capitalist approaches for money and uh for your audience when Venture capitalists or private Equity people or hedge funds raise money they don't generally go to the public they go to uh what we call the limited partner

Community which is University endowments charitable foundations um some giant corporations like insurance companies that hold large amounts of capital um uh groups like that some family offices So You Think Like The Gates Foundation you know giant um uh family offices who have a a uh a time frame of multiple Generations like the fact that those people are going into um uh Venture Capital funds which are 10e plus dated some even 15 plus if they like biotech means it was a missed opportunity to

begin with by the way I did speak to such groups years ago because as a venture capitalist I knew a lot of them and I and I gave what was I call it an IQ test I think it was an IQ test because if once I said what I said the only answer was to buy it and and I'm just being realistic it was like um it was like you could say it was like a lottery ticket in the sense that if you buy it and you lose who cares because it was a dollar but it was a lottery ticket with a lot of fundamentals that pointed to it being important and if you're already buying things in the technology Arena if you don't want to be us Centric a lot of

these places have to think about well you know the US market may become like Europe at some point it may it may kind of stall GDP may be flat for a long time you want to be in areas that are growing well crypto is a globally traded asset um but uh they were scared away generally by Wall Street people who told them it was a scam and uh the definition of a scam to a Wall Street person is a asset that they can't make a commission off of right so that that's the reason I think most of them said don't do it yeah great thanks that'll be big yeah we

should play pay attention to it and and and let's be clear those institutions are not buying Bitcoin maybe a few maybe a few of them like we know Wisconsin pension fund bought some Bitcoin uh but I feel like the earlier this year but those institutions are not yet buying and mainly they're not yet buying because they have very strict mandates they are very large institutions that they don't make changes to their mandate very quickly and their mandates don't say go buy a high risk what would be considered a highrisk asset such as Bitcoin so they're just literally not allowed to now some of these organizations they can buy bonds though and there is there is a way that they can back into it they could go and buy

some corporate bonds from a I know that for example in Bitcoin miners issued about four billion in convertible bonds in November and who do you think those are being bought by a lot of those bonds are being bought by these large institutions who do want access to bitcoin but can't just go directly buy it yet yeah and I'll just say though um again I've talked to a lot of these uh limited partners over the years as a venture capitalists no their mandate doesn't say buy crypto but they have an investment committee and the investment committee has decided on an allocation schedule so whatever 50% is going to be in super

secure like uh uh Global Corporation stocks and then you know some will be in real estate and some will be in Commodities but they always have a small allocation I think Calpers the uh California retirement system for public employees Calpers had a mandate which they never were able to hit which is kind of funny of 2% of their assets should be in venture capital and they could never do it because their assets kept growing and um uh frankly faster than their Venture Capital Holdings uh and um uh they were uh you can only write Small

Checks to venture capital funds you can write a billion doll check to a giant private Equity Fund right which is one of the reasons private Equity frankly has done so well because as these Mega Sovereign wealth funds and us um Municipal and state um retirement funds as they became bigger and bigger and bigger it just it made no sense for them to write the equivalent of a of a $1 check to 50 funds and they're like I'd just rather put a billion into Blackstone you know and so um and there are ways that they tried to make it more scalable but they did have a mandate to

invest in inov in ation right and uh and a lot of the endowments Caltech had had a mandate to invest part of it part of its mission was to be investing in the future of innovation In America which pretty much meant Venture Capital um and maybe they shouldn't own this stuff directly maybe they should invest in crypto focused funds right I could see that but I if I were on the investment Committee of one of these groups you know I would have taken a certain amount but again would have been very little maybe 1% and I would have bought Bitcoin directly because I

don't have to pay a 20% uh tax uh which is called carried interest that's the portion of the profits a fund makes that it keeps for its managers and it gives 80% of the upside to the um to its investors so you kind of you you you bypassed that um but I I always sensed two things when I would talk to these people and I there was nothing in it for me other than wanting them to do well I wasn't selling them Bitcoin you know on a commission basis but it was um uh a little bit difficult where do we custody it and all that I think that problem could have been solved but that was one problem and then the other was um the managers who work for these

endowments um their their uh bonuses are B based on relative performance so as some of your audience may know uh uh it doesn't do that much for these guys to stick their neck out and maybe they have one good year and relative to everybody else they did better so they get a bonus but if there's a bare market for four years um and you do what everybody else does you perform poorly you don't get fired because it's grading on a curve and so they kind of feel like I don't really need to own Bitcoin because um if uh yeah if I miss out on it going up well no one else owns it either except

for these random people so I'm not going to be judged poorly and if Bitcoin does bad and drags me down in years where everybody else is doing well I might get fired I might get fired so you always have to look at incentives right when it comes to how people are making decisions because they are in economics we call these agency costs an agent is someone who you've instructed to do something on your behalf and an agent could be employee right it could be any it could be an Uber driver someone you're instructing to do something on your behalf and economists have this phrase agency cost which is the person who is doing the

task is never fully vested in helping you perfectly they also want to help themselves so they all and if you have a good incentive system you recognize that and you accept it right but uh I would say with guys like Larry thinkink for your audience he's uh um the uh uh the founder and and and chairman I guess of Black Rock managing 10 trillion in assets I'm old enough and it's not that long ago to remember when Larry Fink was calling Bitcoin you know and crypto the stuff that money launderers and tax evaders uh were were interested in and to see him talk about Bitcoin now and

this giant smile on his face and the reason is simple he's decided that retirement account holders want to own it and that's the reason why which I had such an issue with gendler personally reached out to Black Rock and said you guys should do an ETF for Bitcoin like why should Black Rock be rewarded and have this like cart blanch ability to do an ETF when there were people out there friends of mine since 2015 trying to do it who were told no you're scumbags you know so good writt to him yeah yeah no kidding yeah uh William I we're gonna

have to cut the episode off here because uh we're we're we're well overtime but this has been a fantastic conversation uh always a pleasure to have you on the show really appreciate your cander and your experience in the space and uh we'll we'll have to get you back on uh in March to check in uh where we're at or April March or April March or April we'll see yeah yeah it'll be fun I'll be looking forward to uh what's happened that's what I like to hear I I'm glad you're having fun so are we everybody have a wicked awesome day thanks for listening in as always if you liked today's episode please hit subscribe and make sure you follow us don't miss out

on the next one there's also a link in the description to our free 5 minute daily newsletter where we simplify crypto for you while making you laugh and if you're willing to step up your crypto investing game we're going to also leave a link for milk Road Pro you get access to our portfolio where you can see exactly what we are buying this is your number one resource to help you invest successfully in crypto one final note this show is for educational purposes only and nothing we say is financial advice investing in crypto or any asset is risky and you should never invest more than you can afford to lose thanks so much for listening in my friends have a wicked awesome day