WEBVTT

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<v Speaker 1>And then we get a ha moment. Bitcoin. Now what's

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<v Speaker 1>really important for your listeners, And I know this from

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<v Speaker 1>my global investing Five years before bitcoin was released in

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<v Speaker 1>January of two thousand and nine, before that came a

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<v Speaker 1>technology called Empessa, and Empessa was a telecom wanting to

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<v Speaker 1>find a way to bank the unbankables in Kenya and

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<v Speaker 1>it exploded.

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<v Speaker 2>This episode is brought to you by Propy, which is

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<v Speaker 2>sharing their vision video, signing up and inviting a friend,

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<v Speaker 2>and much more so. If you'd like to learn more

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<v Speaker 2>about Propy, visit the link in the description. Welcome into

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<v Speaker 2>the Thinking Crypto Podcast. I'm your host, Tony Edward, and

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<v Speaker 2>my guest today is Frank Holmes, who's the co founder

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<v Speaker 2>of Hive Blockchain Technologies and also the CEO and CIO

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<v Speaker 2>of US Global Investors. Frank, great to have you.

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<v Speaker 1>It's great to be with you, Tony.

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<v Speaker 2>Frank. You have a plethora of experience in the markets,

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<v Speaker 2>from gold to doing IPOs and tradfy and now of

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<v Speaker 2>course building with bitcoin and crypto. And I have a

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<v Speaker 2>lot of questions for you because I want to get

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<v Speaker 2>your perspectives and you know your loads of experience. But

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<v Speaker 2>let's start with your background. Where are you from, where'd

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<v Speaker 2>you grow up? And what's your what made you want

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<v Speaker 2>to get into finance?

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<v Speaker 1>Well, I characterize myself as a text can a textan Canadian,

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<v Speaker 1>and I've been living here for thirty five years in Texas,

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<v Speaker 1>in San Antonio, and I'm known for the world of gold.

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<v Speaker 1>I wrote a book on gold and that journey of

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<v Speaker 1>understanding the dynamics of gold, what are the supplied to

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<v Speaker 1>manufacturers globally gold mining? And you start to realize it

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<v Speaker 1>takes you down other paths, and the gold space led

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<v Speaker 1>me down to bitcoin, and in two thousand and fifteen,

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<v Speaker 1>I launched the first thematic what they call smart baita

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<v Speaker 1>two point zero it's jets etfrom the New York Stock

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<v Speaker 1>Exchange to capture the global airline industry. Because I was

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<v Speaker 1>traveling all over the world. I want something to so

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<v Speaker 1>how do I get my money back? And all this

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<v Speaker 1>money I'm spending traveling And so I recognized that something

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<v Speaker 1>was happening in the bitcoin ecosystem. I went to Consensus

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<v Speaker 1>in twenty seventeen and I remember vividly Abigail Johnson, the

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<v Speaker 1>CEO of Fidelity, was speaking at the conference and was

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<v Speaker 1>talking about bitcoin mining and blockchain why was so important

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<v Speaker 1>for the backbone? So I'd done work prior to that

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<v Speaker 1>and said, okay, well, let's see we can launch a

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<v Speaker 1>bitcoin etf Because I launched the jets well, I realized quickly,

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<v Speaker 1>at one thousand dollars an hour legal bill, it wasn't

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<v Speaker 1>going to go anywhere. And I went to Canada and

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<v Speaker 1>the same thing. They were basically anti bitcoin ETF, and

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<v Speaker 1>fortunately it didn't really occurred last year that it finally

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<v Speaker 1>got launched a bitcoin ETF. So I launched the first

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<v Speaker 1>crypto mining company called Hive Blockchain Technology, and then subsequently

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<v Speaker 1>changed the name to High Digital Technologies because you realize

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<v Speaker 1>you're really in the data center business. And I'll give

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<v Speaker 1>you more color on that, but it was the first

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<v Speaker 1>crypto mining company, and when we went public, we had

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<v Speaker 1>some basic value vision statements that we made and that

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<v Speaker 1>mission was to be green only. So we launched in

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<v Speaker 1>Iceland and then we went into Sweden, and then after

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<v Speaker 1>the first halving, we came into Canada in Montreal, and

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<v Speaker 1>then we built a big campus using eighty megawats on

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<v Speaker 1>the border of Maine and New Brunswick, so we're only

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<v Speaker 1>using hydro electricity. And now we've grown to Paraguay where

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<v Speaker 1>we're going to increase our production profile from six exa

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<v Speaker 1>hash to twenty five over the next nine months. So

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<v Speaker 1>we function in nine time zones, five languages, and I'm

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<v Speaker 1>so proud of the team, Tony. We keep showing up

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<v Speaker 1>in anthipower as the most efficient bitcoin minor.

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<v Speaker 2>That's amazing and what a journey, Frank And you know

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<v Speaker 2>you were trying to get an ETF around bitcoin in

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<v Speaker 2>the early days and certainly it's been an arduous journey

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<v Speaker 2>for many folks to get to what happened last year

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<v Speaker 2>with your final approval. You know, what are some similarities

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<v Speaker 2>that you see with the gold market and bitcoin, because

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<v Speaker 2>many folks categorize bitcoin as digital goal at store value

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<v Speaker 2>has some better properties around it than gold itself. And

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<v Speaker 2>was you know, maybe when you heard Abigail Johnson or

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<v Speaker 2>what was your first encounter with bitcoin and when did

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<v Speaker 2>it click for you? What was your aha moment?

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<v Speaker 1>Well, the haha moment is that someone as one of

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<v Speaker 1>the largest asset managers in the world, doesn't speak at

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<v Speaker 1>investment conferences but speaks at consensus, and that was saying

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<v Speaker 1>something big is happening outside of this realm, this world.

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<v Speaker 1>There's another metaverse and and exploring and discovering the metaverse

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<v Speaker 1>of crypto was so shocking to me, Like I feel

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<v Speaker 1>like I was kept in a cave of how it

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<v Speaker 1>was evolving and learning that there's thirty million kids around

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<v Speaker 1>mining ethereum with their GPU chips and when they went

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<v Speaker 1>to bed, so you had this incredible ecosystem before they

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<v Speaker 1>went from proof of work to proof of steak, which

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<v Speaker 1>was the disaster which but back then it was interested

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<v Speaker 1>to see these kids were gamers go to bed mining ethereum.

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<v Speaker 1>I had a paper route. I slept papers in the

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<v Speaker 1>snow in Canada in the seventies earning money. And these

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<v Speaker 1>kids are all of a sudden mining ethereum and they

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<v Speaker 1>found a way at the age of twelve years old

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<v Speaker 1>to get cash for it to upgrade them by a

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<v Speaker 1>new computer system. So they had the exchanges have been

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<v Speaker 1>created outside of the normal regulative world and methodologies to

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<v Speaker 1>crystallize in transform this transformation of something digital into cash

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<v Speaker 1>to be able to upgrade a computer that was an

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<v Speaker 1>odd to me, and I became so accelerated in learning

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<v Speaker 1>what was going on.

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<v Speaker 2>And you know, in regards to what you said about

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<v Speaker 2>the kids mining, right, we're heading into a more digital world.

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<v Speaker 2>I think we can all agree on that things are

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<v Speaker 2>not going to get less digital, and the next generation

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<v Speaker 2>is not going to necessarily want to have gold bars,

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<v Speaker 2>so to speak, but they're going to deal with digital

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<v Speaker 2>currencies and NFTs and these different things. Do you see

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<v Speaker 2>bitcoin becoming a larger acid than gold itself having a

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<v Speaker 2>larger market cap and so forth.

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<v Speaker 1>It's a great question. I think you will probably find

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<v Speaker 1>some way how the ordinal art world was able to

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<v Speaker 1>take a one hundred millionth of a bitcoin and all

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<v Speaker 1>of a sudden create value by attaching something to it.

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<v Speaker 1>That's going to happen with gold. I know that I

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<v Speaker 1>was a fun and was an early investor in the

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<v Speaker 1>creation of where you make that attachment like an NFT,

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<v Speaker 1>but you actually have a piece of art that's transferable

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<v Speaker 1>into one gram of gold that can digitally be sent

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<v Speaker 1>around and you can make a claim on it somewhere else.

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<v Speaker 1>So that technology will evolve, and I think probably they're

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<v Speaker 1>going to become where there's one on one is eleven.

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<v Speaker 1>I think the whole idea that when people don't realize

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<v Speaker 1>and all these people buying the bitcoin ETFs Ria is

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<v Speaker 1>recommending them, they do not know often that one bitcoin

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<v Speaker 1>is worth one hundred million satoshi's and if they go

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<v Speaker 1>and buy a penny stock, they might as well just

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<v Speaker 1>go and spend one thousand dollars and buy one thousand

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<v Speaker 1>dollars of total h ODL, which is van x bitcoin

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<v Speaker 1>ETF on Robinhood, and they've got a million satoshi's and

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<v Speaker 1>when that satoshi hits a penny, that bitcoin is worth

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<v Speaker 1>a million dollars. Well will that happen? We found from

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<v Speaker 1>our bitcoin inventory that some of us A tootions were

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<v Speaker 1>very valuable because of their number sequence at the time

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<v Speaker 1>that they were mine, and they were worth ten dollars.

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<v Speaker 1>So when someone said to me that bitcoin go to

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<v Speaker 1>a million dollars, is it easy? Because it just has

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<v Speaker 1>to be at a penny, it's worth a million dollars.

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<v Speaker 1>So the math behind that is Metcalf's law, which basically

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<v Speaker 1>says that if you have supply limited and demand grows,

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<v Speaker 1>the price will grow exponentially. I know this from my

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<v Speaker 1>resource expertise in the diamond world. Did you know that

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<v Speaker 1>after World War Two only three percent of Americas used

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<v Speaker 1>a diamond to validate a commitment for marriage. Only three

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<v Speaker 1>percent is now eighty Because the beers influence, but they

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<v Speaker 1>control the supply. It wasn't capped the twenty one million

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<v Speaker 1>coins until the Russians that are flooding the world with diamonds.

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<v Speaker 1>The de beers had such a monopoly that they grew

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<v Speaker 1>eighty percent adoption. Then in the sixty five they went

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<v Speaker 1>to Japan and did it all over again. So what

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<v Speaker 1>happens is that scenarios shows up in the world of art.

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<v Speaker 1>If you have one of Picasso's original prints of one hundred,

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<v Speaker 1>or you had any warholse thousand prints of Mao that

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<v Speaker 1>came out of one thousand dollars, they went up to

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<v Speaker 1>fifty thousand dollars because the supply was limited. The adoption

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<v Speaker 1>and the growth of China and the adoption of any

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<v Speaker 1>who art it grew exponentially. Well, this makes it very

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<v Speaker 1>easy and understandable why bitcoin using Metcalf's law will grow exponentially.

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<v Speaker 1>What other important laws are there are like Moore's law

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<v Speaker 1>that says the engineering and the cost of a chip

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<v Speaker 1>is going to drop every couple of years, and therefore

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<v Speaker 1>it's more affordable for more people and that's driving the

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<v Speaker 1>technological evolution. Well, you have these laws that are very important,

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<v Speaker 1>but never forget Murphy's law, because you just don't know

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<v Speaker 1>when you would think that this year of bitcoins should

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<v Speaker 1>be on a terran has gone through a correction, So

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<v Speaker 1>Murphy always shows up.

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<v Speaker 2>Yeah, great points, and I love the example of Metcalf's

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<v Speaker 2>law and network adoption. Now you mentioned that in certain instances,

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<v Speaker 2>certain stitutions were more valuable. Is talk to us about,

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<v Speaker 2>you know, what you're encountering in the open market with

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<v Speaker 2>folks looking to buy bitcoin, whether the institutions are they

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<v Speaker 2>focused on where this bitcoin was mine and what type

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<v Speaker 2>of energy was used to mine it.

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<v Speaker 1>No, no, there is, there is for hive hive being

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<v Speaker 1>green only. Intel approached us and we were the first.

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<v Speaker 1>We have many first in this trajectory of hive evolving.

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<v Speaker 1>We're the first to balance the grid before it became

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<v Speaker 1>a big benefit for Riot coming into Texas. We were

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<v Speaker 1>doing this in Sweden and first to recycle electron of

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<v Speaker 1>energy from a data center into a manufacturer building and

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<v Speaker 1>save that building as one hundred and seventy workers, saving

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<v Speaker 1>them three hundred thousand dollars a year on their electrical bill.

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<v Speaker 1>So with that what we found because we have hydro,

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<v Speaker 1>Intel reached out to us to create the first AS

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<v Speaker 1>chip with them and it became the buzz Minor. Then

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<v Speaker 1>they got out of the business. They had other problems

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<v Speaker 1>of our enough R and D to compete with Nvidia,

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<v Speaker 1>but were they approached us and inn Vidia allowed us

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<v Speaker 1>to buy GPU chips that were also used for AI

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<v Speaker 1>other bitcoin miners that were only miners bought in Vidia chips.

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<v Speaker 1>They could onwly mine ethereum. We had the ability and

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<v Speaker 1>the skill set of mining ethereum, and when Ethereum went

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<v Speaker 1>away from proof of work to proof of steak, we

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<v Speaker 1>were able to repurpose and start using our GPA chips

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<v Speaker 1>for AI adoption, and that business is growing slowly and nicely.

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<v Speaker 1>We see many people coming out and raising a lot

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<v Speaker 1>of money in the bitcoin mining get into the HPC realm.

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<v Speaker 1>The million people that we see successfully have done it

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<v Speaker 1>has been Core Scientific and that's part only because core

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<v Speaker 1>Weave is funding it. It's very expensive for your listeners

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<v Speaker 1>to understand one megawater of electricity for bitcoin mining is

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<v Speaker 1>going to cost you about a million dollars of infrastructure spending.

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<v Speaker 1>If you're going to go to high performance computing what

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<v Speaker 1>they call Tier three, it's a minimum ten million dollars

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<v Speaker 1>of infrastructure spending excluding the chips. So last week when

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<v Speaker 1>I was at at the Blockchain Summit in Washington, Cambridge

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<v Speaker 1>Analytics at the University of Cambridge had a study and

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<v Speaker 1>they said the cost of transport going through the transformation

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<v Speaker 1>of bitcoin mind to high performance computing for AI is

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<v Speaker 1>thirty three to one, it's a much bigger spend. So

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<v Speaker 1>what did we do that was unique. We put our

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<v Speaker 1>chips on bare metals platforms and where coders could all

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<v Speaker 1>of a sudden rent them by the hour. They don't

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<v Speaker 1>have to be locked up and long like on demand supply,

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<v Speaker 1>and that's what we've been able to provide, and we

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<v Speaker 1>continue to buy more Nvidia chips and we're now we're

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<v Speaker 1>going to start building our own data centers that are

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<v Speaker 1>only high performance computing. But to get the same revenue

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<v Speaker 1>for one hundred megawat bitcoin mining facility, you need only

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<v Speaker 1>ten minute megawatts for high performance computing, So this ten

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<v Speaker 1>to one ratio is important to recognize. But the chips

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<v Speaker 1>are much more expensive. You're spending thirty five thousand dollars

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<v Speaker 1>for an Nvidia chip, not three thousand, five hundred dollars,

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<v Speaker 1>So it's for investors to recognize there are big differences.

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<v Speaker 1>And then when you're tech technician mining bitcoin, the skill

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<v Speaker 1>set is very different than GPU chips. It's like driving

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<v Speaker 1>a Bronco truck versus driving a Ferrari. The engineering, the skills,

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<v Speaker 1>the temperance like the Ferraris always have to be brought

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<v Speaker 1>in for updates and checks et cetera. Are Broncos rugged

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<v Speaker 1>and that's what ACE chips are like. They're rugged, and

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<v Speaker 1>that's the big difference that you see. But for us,

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<v Speaker 1>we're so excited about what we're doing, in particular in Paraguay,

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<v Speaker 1>which I want to come back to, because we are

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<v Speaker 1>balancing the grid in a different way Tony. In Sweden

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<v Speaker 1>we are able to hedge and give back the energy

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<v Speaker 1>whenever there's a spike in the energy, go from thirty

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<v Speaker 1>megawats to three and fifteen seconds and back up. But

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<v Speaker 1>in Paraguay they built the biggest dam with Brazil in

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<v Speaker 1>the western hemisphere, and half of the electricity goes to

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<v Speaker 1>Paraguay and the other goes to Brazil. If Paraguay doesn't

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<v Speaker 1>use the energy, it all goes to Brazil. And so

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<v Speaker 1>they were taking this energy and they were selling it

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<v Speaker 1>to for a slight markup to Argentina, and Argentina was

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<v Speaker 1>a disaster till Malay came in and it was no paid,

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<v Speaker 1>so it had a huge fiscal strain on the government

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<v Speaker 1>running their business. And so now we've seen Malay give

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<v Speaker 1>back some of the money. So they went from no

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<v Speaker 1>pay to slow pay. But bitcoin miners that get paid

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<v Speaker 1>every month, so it allows them to get US dollars

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<v Speaker 1>every month, and it's an embedded currency hedge that no

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<v Speaker 1>bank has the capital base to do except for bitcoin miners.

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<v Speaker 1>And when we come in we help build their infrastructure.

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<v Speaker 1>We take this raw high voltage power which would blow

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<v Speaker 1>out any normal hair dryer and toaster, down to low

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<v Speaker 1>voltage that we need for these data centers. And that

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<v Speaker 1>that's fifteen million dollars spend. You know, that's a big spend,

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<v Speaker 1>but we help the economy, we help the country. We

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<v Speaker 1>have now employing three hundred some odd people building our

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<v Speaker 1>data centers out. We're already starting on turning on some

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<v Speaker 1>of the machines and we'll have a material number next week.

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<v Speaker 1>That's what we're hoping for as machines come in and

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<v Speaker 1>the wires come in, but they're is sort of the

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<v Speaker 1>exciting part is that we'll become the biggest user of

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<v Speaker 1>electricity for the end. It's called a utility owned by

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<v Speaker 1>the government, so we'll become an important balancing of the

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<v Speaker 1>grid for them in a different way than we're balancing

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<v Speaker 1>the grid in Sweden. Wow.

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<v Speaker 2>And with how things have changed for bitcoin and crypto,

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<v Speaker 2>I mean, the United States is looking to establish a

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<v Speaker 2>bigcoin reserve. You have all of Wall Street here looking

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<v Speaker 2>to launch different products around bitcoin. They've obviously launched a

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<v Speaker 2>Bitcoin's body TFS, and we're seeing a lot of demand there.

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<v Speaker 2>Are you on the mining side now getting a lot

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<v Speaker 2>of demand from investors or customers who want to use

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<v Speaker 2>your services because we're seeing some sort of game theory

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<v Speaker 2>play out here.

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<v Speaker 1>For bitcoin, we are. I think that the first big

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<v Speaker 1>wave of the US becoming a dominant player took place

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<v Speaker 1>when China dumped all the machines and put people in

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<v Speaker 1>jail and confiscated and destroyed all the ACIC miners that

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<v Speaker 1>they could. The idea was important for the listeners of

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<v Speaker 1>being decentralized, and I'm going to sorry we've back and forth,

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<v Speaker 1>but in the world of gold, like bitcoin, there are similarities.

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<v Speaker 1>They're decentralized, so no one government, no one country, no

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<v Speaker 1>one central United Nations controls the price of gold, and

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<v Speaker 1>so central banks use gold as a medium the same

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<v Speaker 1>thing as with bitcoin. The big attraction with bitcoin is

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<v Speaker 1>that there's one hundred and ninety five countries, one hundred

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<v Speaker 1>and ninety five central banks, but there are now over

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<v Speaker 1>twenty thousand notes around the world. And you've got to

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<v Speaker 1>think of it like the old imagery from watching Star

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<v Speaker 1>Trek or Star Wars where they have a force shield

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<v Speaker 1>around them and missiles come in and the force shield

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<v Speaker 1>sort of bends and then comes right back. It bens,

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<v Speaker 1>it comes right back. That's the big point force shield

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<v Speaker 1>around the world. And so China blows everything out and

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<v Speaker 1>it bens. The prices come down and difficulty comes down,

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<v Speaker 1>and that comes right back stronger than ever. And who

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<v Speaker 1>it made it stronger was America, in particular the state

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<v Speaker 1>of Texas. And so when you start going down the

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<v Speaker 1>path of what is gold, what is paper money, when

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<v Speaker 1>you start realizing it all started with the Magna cart

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<v Speaker 1>in twelve fifteen of where private property rights led to

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<v Speaker 1>human human humanitarian rights, and whenever in the past thirty

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<v Speaker 1>years they've taken away private property rights like Venezuela, they've

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<v Speaker 1>taken away human rights. So really they're connected. Private property

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<v Speaker 1>and human rights are really so cemented together. And the

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<v Speaker 1>evolution of private property rights really grew with common law,

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<v Speaker 1>not with civil law. It grew with common law. Patent

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<v Speaker 1>law was important. It came from common law and civil

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<v Speaker 1>law copies which takes place in common law China built

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<v Speaker 1>their stock exchanges based on common law rules. They the

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<v Speaker 1>only way to attract capital if you go in downtown Dubai,

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<v Speaker 1>which is civil law, sharia law all around it. They

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<v Speaker 1>create a square mile which is common law, and that

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<v Speaker 1>is the best property rights. So the idea of bitcoin

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<v Speaker 1>really comes out of the concept of private property rights

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<v Speaker 1>like gold. So I have cash in my wall, in

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<v Speaker 1>my pocket here and this is my I have had property,

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<v Speaker 1>this is mine. It's in my pocket. When I put

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<v Speaker 1>it in the bank, all of a sudden, I don't

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<v Speaker 1>have total control. I've lost my private property rights. If

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00:21:09.839 --> 00:21:11.640
<v Speaker 1>they want to shut down or make it difficult for

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00:21:11.720 --> 00:21:15.279
<v Speaker 1>me to get my ATM working, the card doesn't work.

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<v Speaker 1>So recognizing what is private property in a lot of

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<v Speaker 1>parts of the world, it's the gold Bengals. The women

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<v Speaker 1>that got out of Syria the first just took off

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<v Speaker 1>their twenty four carroc gold and they got out. That

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<v Speaker 1>was their portable wealth. The same thing with Vietnase people,

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<v Speaker 1>the boat people in the seventies ago. First they call

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<v Speaker 1>it a gold tail, a grammar gold got them out.

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<v Speaker 1>That new ticket out of an oppressed country will be

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<v Speaker 1>bitcoin because you're able to protect it's more portable than gold.

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<v Speaker 1>It's but it's not as pretty as gold unless you

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<v Speaker 1>make the bitcoin design and logo. But gold can be

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<v Speaker 1>made into so many beautiful jewelry and images, especially when

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<v Speaker 1>you go throughout India. Every state in India has its

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<v Speaker 1>own unique design, but it's all twenty four carat. And

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<v Speaker 1>so I think that what we're seeing in the evolution

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<v Speaker 1>of the digital world is that bitcoin, no doubt, is

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<v Speaker 1>the critical element. And the blockchain with which I'm giving

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<v Speaker 1>a speech next week in Paris on it how it

359
00:22:19.480 --> 00:22:23.480
<v Speaker 1>was Looking back in time with ninety one is when

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<v Speaker 1>two professors are basically Bell Labs. Bell Labs basically invented

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<v Speaker 1>blockchain as digital timestamp. They went nowhere and along comes

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<v Speaker 1>hashing power to try to stop spam by doctor beck As,

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<v Speaker 1>a cryptologist, which is really fascinating to watch. And then

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<v Speaker 1>we have a big gold by another cryptologist by Nick Sasbol,

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<v Speaker 1>but they really they just are stepping stones. And then

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<v Speaker 1>we have Napster, which shows the power appear to appear.

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<v Speaker 1>And then we have the Defense Department the US on

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<v Speaker 1>Lisha shaw to fifty six, which is the encryption that's

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<v Speaker 1>used on your cell phone for facial recognition. And then

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<v Speaker 1>we get a ha moment. Bitcoin. Now what's really important

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<v Speaker 1>for your listeners? And I know this from my global

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<v Speaker 1>investing five years before bitcoin was released in January of

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<v Speaker 1>two thousand and nine. Before that came a technology called

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<v Speaker 1>Mpessa and Impessa was the telecom wanting to find a

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<v Speaker 1>way to bank the unbankables in Kenya and it exploded

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<v Speaker 1>like it's more than ten percent of the GDP of

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<v Speaker 1>Kenya today. I was with a driver in London six

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<v Speaker 1>months ago and he was telling me how he uses

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<v Speaker 1>it to send money to his family. He has paid

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<v Speaker 1>him at being a uber driver in pounds and he's

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<v Speaker 1>able to easily convert to send it down to Nigeria.

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<v Speaker 1>Another drivers tell me in Ghana SOPs it technology, which

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<v Speaker 1>shows you the idea of digital timestamp. You realize the

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<v Speaker 1>real biggest centers of money in the world are telecom

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<v Speaker 1>companies and banks need the telecom actually to make it work.

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<v Speaker 1>But they've been trying to stop the evolution and the

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<v Speaker 1>adoption of bitcoin. The bank lobbying groups in the US

388
00:24:20.000 --> 00:24:24.839
<v Speaker 1>have had a major, significant political influence of harming the

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<v Speaker 1>adoption of bitcoin. But I think we're going past it.

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<v Speaker 1>We're still going to have this volatility. I agree with

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<v Speaker 1>Abigail Johnson that blockchain, all stock settlements should be on

392
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<v Speaker 1>the blockchain, all federal financial disclosure, et cetera, to be

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<v Speaker 1>on the blockchain, that the confidentially between the two parties

394
00:24:44.599 --> 00:24:47.359
<v Speaker 1>is there. But as all time stamped and an open ledger.

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<v Speaker 1>I think these are all This adoption is in full speed,

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00:24:52.519 --> 00:24:56.720
<v Speaker 1>and Bitcoin proved it. All the other crypto coins is

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00:24:56.839 --> 00:24:58.480
<v Speaker 1>all because of Bitcoin.

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<v Speaker 2>Yeah, oh, sorry, didn't mean to cut you out there, Frank.

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00:25:02.200 --> 00:25:04.359
<v Speaker 1>No, no you didn't. I just start talking about I

400
00:25:04.680 --> 00:25:06.799
<v Speaker 1>get I need something to drink because I get so

401
00:25:06.920 --> 00:25:12.599
<v Speaker 1>excited talking about it, this technology and how it's evolved,

402
00:25:13.200 --> 00:25:16.359
<v Speaker 1>and I see the significance of the ordinal market. I

403
00:25:16.440 --> 00:25:19.920
<v Speaker 1>see the significance of Bitcoin. What really surprised me is

404
00:25:19.960 --> 00:25:23.160
<v Speaker 1>that hearing last year bitcoin is dead. Bitcoin is dead,

405
00:25:23.200 --> 00:25:26.359
<v Speaker 1>and I'm scratching my head. If you stop bitcoin mining,

406
00:25:26.799 --> 00:25:30.839
<v Speaker 1>then the whole bitcoin ecosystem actually dies. You need to

407
00:25:30.960 --> 00:25:34.240
<v Speaker 1>have these nodes everywhere in the world validating. You need

408
00:25:34.319 --> 00:25:38.079
<v Speaker 1>to have this decentralized mechanism. And I think what's going

409
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<v Speaker 1>to happen is that Paraguay will become the most dominant

410
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<v Speaker 1>place in South America and robob you're going to see

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<v Speaker 1>in East Africa. Ethiopia is doing everything to be part

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<v Speaker 1>of the cryptal mining ecosystem, and I think this is

413
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<v Speaker 1>really important that America and Europe is going to be,

414
00:26:00.079 --> 00:26:04.079
<v Speaker 1>Germany and Sweden and Norway are going to be part

415
00:26:04.319 --> 00:26:07.799
<v Speaker 1>really key for this ecosystem to continue to evolve and

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<v Speaker 1>new technology will come along with it.

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<v Speaker 2>Question on you know, you mentioned that the mining needs

418
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<v Speaker 2>to happen or a network fails, right, eventually all biquin

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00:26:19.119 --> 00:26:21.599
<v Speaker 2>will be mine. What do you think happens after that?

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<v Speaker 2>Will miners keep going to handle transactions and fees?

421
00:26:26.519 --> 00:26:31.480
<v Speaker 1>Absolutely, and there'll be new technology, new breakthroughs like ordinals

422
00:26:32.599 --> 00:26:34.559
<v Speaker 1>of how you attach a piece of art. And what

423
00:26:34.640 --> 00:26:37.799
<v Speaker 1>a lot of people didn't understand was that having a

424
00:26:37.960 --> 00:26:42.400
<v Speaker 1>picture of my nine year old daughter walking down down

425
00:26:42.480 --> 00:26:47.200
<v Speaker 1>the beach in Miami holding her hand on her birthday

426
00:26:47.759 --> 00:26:50.400
<v Speaker 1>and there's a photograph, and all of a sudden, the

427
00:26:50.559 --> 00:26:54.319
<v Speaker 1>value I want that ordinal. I want to just get

428
00:26:54.359 --> 00:26:58.480
<v Speaker 1>that ordinal, attach that photograph and digitize this moment in time,

429
00:26:59.279 --> 00:27:02.240
<v Speaker 1>and that I can go and get that exact hour.

430
00:27:03.119 --> 00:27:07.000
<v Speaker 1>I mean, that's incredible. So the value of that number

431
00:27:07.440 --> 00:27:10.640
<v Speaker 1>goes from point zero zero zero sixth sense to all

432
00:27:10.640 --> 00:27:14.640
<v Speaker 1>of a sudden worth ten dollars because I'm emotionally attached

433
00:27:14.640 --> 00:27:17.680
<v Speaker 1>to that photo. Well, someone else is in Prague, and

434
00:27:17.720 --> 00:27:21.279
<v Speaker 1>another person is in Buenos aias another person is in Singapore.

435
00:27:21.640 --> 00:27:25.680
<v Speaker 1>They're all having these emotional moments, and those emotional moments

436
00:27:26.000 --> 00:27:28.720
<v Speaker 1>all of a sudden can be locked in time and

437
00:27:28.839 --> 00:27:33.799
<v Speaker 1>digitized at a specific number sixty four digits. I think

438
00:27:33.960 --> 00:27:37.839
<v Speaker 1>is very exciting and only makes the network more valuable,

439
00:27:38.640 --> 00:27:40.799
<v Speaker 1>especially when you think of moving grams of gold.

440
00:27:43.039 --> 00:27:46.319
<v Speaker 2>Yeah, tell us a bit about your strategy as far

441
00:27:46.400 --> 00:27:49.480
<v Speaker 2>as when you mind bitcoin, are you selling it, are

442
00:27:49.559 --> 00:27:51.119
<v Speaker 2>you holding it? Or is it like a fifty to

443
00:27:51.160 --> 00:27:54.039
<v Speaker 2>fifty split on how you handle the actual token.

444
00:27:54.319 --> 00:27:56.000
<v Speaker 1>We were the first to do hotaling and we were

445
00:27:56.279 --> 00:27:59.759
<v Speaker 1>holding our THEEUM and it was a big win for us,

446
00:28:00.680 --> 00:28:02.559
<v Speaker 1>and we sold lovery theory and we did not get

447
00:28:02.599 --> 00:28:07.359
<v Speaker 1>into the staking game, and so we then started increasing

448
00:28:07.440 --> 00:28:10.880
<v Speaker 1>our bitcoin. We've used it because one of the nice

449
00:28:10.920 --> 00:28:14.039
<v Speaker 1>parts there's third party analysts will it will share with

450
00:28:14.200 --> 00:28:17.920
<v Speaker 1>you that we have the highest returns on invested capital.

451
00:28:18.480 --> 00:28:21.680
<v Speaker 1>So we are if you look at our bitcoin operations,

452
00:28:21.759 --> 00:28:26.119
<v Speaker 1>besides being the most efficient mining facilities of how we function.

453
00:28:27.000 --> 00:28:30.279
<v Speaker 1>We have the lowest GNA to minor bitcoin. We have

454
00:28:30.400 --> 00:28:34.799
<v Speaker 1>the highest revenue per employee mining bitcoin, and we're very

455
00:28:34.960 --> 00:28:39.119
<v Speaker 1>frugal of how we manage the operations, and that sort

456
00:28:39.119 --> 00:28:44.079
<v Speaker 1>of lends itself into the bitcoin mining and putting it

457
00:28:44.160 --> 00:28:46.000
<v Speaker 1>on your balance sheet, because there's a time when you

458
00:28:46.200 --> 00:28:49.799
<v Speaker 1>have it. So we had in our balance sheet and

459
00:28:49.920 --> 00:28:52.839
<v Speaker 1>it grew. It was sixty percent year over year. Each month,

460
00:28:52.880 --> 00:28:56.559
<v Speaker 1>it was growing, growing, growing, and we're expanding into for

461
00:28:56.599 --> 00:29:00.400
<v Speaker 1>one hundred megawats into Paraguay, and all of a sudden

462
00:29:00.440 --> 00:29:03.480
<v Speaker 1>bitfarms opportunity came in that not only are we going

463
00:29:03.519 --> 00:29:05.400
<v Speaker 1>to go one hundred megawats, we're going to attack on

464
00:29:05.519 --> 00:29:08.720
<v Speaker 1>two hundred faster. So we would use and souls for

465
00:29:08.759 --> 00:29:11.599
<v Speaker 1>a bitcoin at one hundred and one thousand ninety some

466
00:29:11.759 --> 00:29:14.519
<v Speaker 1>one thousand to be able to lock up and get

467
00:29:14.599 --> 00:29:18.880
<v Speaker 1>that transaction, and it worked out well. You know, we

468
00:29:19.680 --> 00:29:22.200
<v Speaker 1>all of a sudden now have a growth plan. I'm

469
00:29:22.240 --> 00:29:26.599
<v Speaker 1>not going from six to fifteen mega exa hash, We're

470
00:29:26.640 --> 00:29:29.519
<v Speaker 1>going to twenty five and we have the strongest growth

471
00:29:29.920 --> 00:29:33.759
<v Speaker 1>profile and it's different than these other cryptal mining companies

472
00:29:33.799 --> 00:29:37.039
<v Speaker 1>have been doing all these convertible notes to buy bitcoint

473
00:29:37.400 --> 00:29:41.359
<v Speaker 1>that's for me. That is the brilliance of Michael sailor

474
00:29:41.759 --> 00:29:45.200
<v Speaker 1>for micro strategy of Michael Senter is done. But all

475
00:29:45.240 --> 00:29:47.200
<v Speaker 1>of a sudden, all the other mining companies getting into

476
00:29:47.240 --> 00:29:50.400
<v Speaker 1>that realm. Only've done for me is create shorting on

477
00:29:50.480 --> 00:29:54.279
<v Speaker 1>their stock. They do these financings and now you say, well,

478
00:29:54.319 --> 00:29:56.400
<v Speaker 1>we did Severn fifty million dollars, so if they had

479
00:29:56.440 --> 00:29:59.480
<v Speaker 1>to go buy back stock because people are shorting against

480
00:29:59.519 --> 00:30:02.960
<v Speaker 1>the position, and most of these guys are offside now

481
00:30:04.279 --> 00:30:07.559
<v Speaker 1>that they were buying the bitcoin. And so every time

482
00:30:07.640 --> 00:30:10.960
<v Speaker 1>there's sort of been binge buying going in of a debt.

483
00:30:11.359 --> 00:30:14.160
<v Speaker 1>And you've seen this when they're all going to Celsius

484
00:30:14.279 --> 00:30:18.359
<v Speaker 1>to borrow and other groups at fourteen percent, it dismantled argo.

485
00:30:19.960 --> 00:30:22.720
<v Speaker 1>It really hurt many of these crypto mining companies. I've

486
00:30:22.920 --> 00:30:26.359
<v Speaker 1>never done that. Every crisis that happened from Celsius to

487
00:30:27.319 --> 00:30:31.880
<v Speaker 1>Ethereum going away to sambankment and FTX blowing up the industry,

488
00:30:31.880 --> 00:30:35.160
<v Speaker 1>they're that six month period. We still have operating income

489
00:30:36.200 --> 00:30:39.200
<v Speaker 1>because we run this operation what we think, so we're

490
00:30:39.319 --> 00:30:43.839
<v Speaker 1>being contrarian. We turned down doing a convertible note to

491
00:30:44.000 --> 00:30:47.920
<v Speaker 1>go buy more bitcoin we said no, we believe in bitcoin.

492
00:30:48.400 --> 00:30:52.079
<v Speaker 1>That's why we're going to buy more machines from all

493
00:30:52.160 --> 00:30:55.200
<v Speaker 1>the providers, and that's why I've been able to We're

494
00:30:55.279 --> 00:30:57.799
<v Speaker 1>not going to do these convertible notes to buy more bitcoin.

495
00:30:58.119 --> 00:31:01.519
<v Speaker 1>We would sell some to research footprint, and then we

496
00:31:01.599 --> 00:31:04.599
<v Speaker 1>can replace it very quickly at our balance sheet. So

497
00:31:04.839 --> 00:31:07.920
<v Speaker 1>that drives the highest cash, low returnal and investor capital

498
00:31:08.039 --> 00:31:09.839
<v Speaker 1>model of all the crypto miners.

499
00:31:11.119 --> 00:31:12.839
<v Speaker 2>Frank, what are your thoughts? And I have a bit

500
00:31:12.880 --> 00:31:15.720
<v Speaker 2>of a concern on this. We saw game Stop just

501
00:31:15.839 --> 00:31:19.359
<v Speaker 2>enter the game. They're going to raise one point five

502
00:31:19.400 --> 00:31:22.720
<v Speaker 2>billion to buy bitcoin. I am a bit concern about

503
00:31:22.720 --> 00:31:25.079
<v Speaker 2>what Michael Sailor and Strategy is doing because of the

504
00:31:25.119 --> 00:31:27.400
<v Speaker 2>amount of leverage. Not that if they use their cash

505
00:31:27.440 --> 00:31:29.880
<v Speaker 2>on their balance sheet to buy bitcoin, no problem with that,

506
00:31:30.039 --> 00:31:32.839
<v Speaker 2>but the excessive leverage. Are you concerned at all about that?

507
00:31:33.319 --> 00:31:35.759
<v Speaker 1>I'm not so much concerned about him because what we

508
00:31:35.920 --> 00:31:40.079
<v Speaker 1>have found with Hive is that these funds are shorting

509
00:31:40.240 --> 00:31:43.799
<v Speaker 1>Hive and we're not doing the transaction. Because the size

510
00:31:43.839 --> 00:31:46.279
<v Speaker 1>of some of these other crypto mining companies are the

511
00:31:46.400 --> 00:31:50.920
<v Speaker 1>funds they're raising, they can't get short the stock. Here's

512
00:31:50.960 --> 00:31:54.799
<v Speaker 1>you have to understand capital markets, these convertible notes are

513
00:31:54.960 --> 00:31:59.319
<v Speaker 1>often leverage eight to one, so they're going to go

514
00:31:59.559 --> 00:32:02.319
<v Speaker 1>and short the heck out of your stock so that

515
00:32:02.440 --> 00:32:04.559
<v Speaker 1>they're not going to have this risk and they want

516
00:32:04.599 --> 00:32:08.319
<v Speaker 1>a torque on the upside. That's roughly what that model is,

517
00:32:09.440 --> 00:32:12.640
<v Speaker 1>Michael Sailor being the first to do this on a scale.

518
00:32:13.240 --> 00:32:15.599
<v Speaker 1>And then all of a sudden you see an ETF

519
00:32:15.759 --> 00:32:20.680
<v Speaker 1>created with Tesla, a single purposed ETF with Tesla, And

520
00:32:20.759 --> 00:32:23.759
<v Speaker 1>what does that single purpose ETF do? And just covered writing?

521
00:32:24.160 --> 00:32:27.960
<v Speaker 1>Because Tesla is so volatile, money comes in. They merely

522
00:32:28.079 --> 00:32:31.839
<v Speaker 1>sell twenty day calls. Twenty day calls, so the income

523
00:32:32.079 --> 00:32:35.000
<v Speaker 1>coming back to that investor is two percent a month,

524
00:32:35.640 --> 00:32:40.720
<v Speaker 1>twenty four percent a year, sometimes higher. So Tesla goes down,

525
00:32:40.839 --> 00:32:44.400
<v Speaker 1>but they're still getting this return capital and they put

526
00:32:44.440 --> 00:32:47.160
<v Speaker 1>that in their four to one K or their IRA

527
00:32:47.680 --> 00:32:51.200
<v Speaker 1>and they're getting this this income coming back basically tax free.

528
00:32:52.240 --> 00:32:55.839
<v Speaker 1>Micro strategy does it too? Well, what does this really mean? Well,

529
00:32:55.880 --> 00:32:58.839
<v Speaker 1>it means that when a market maker has to go

530
00:32:59.359 --> 00:33:03.079
<v Speaker 1>and and go short because he's going long the calls,

531
00:33:03.160 --> 00:33:06.160
<v Speaker 1>he's forced to do the cover writing. It creates more

532
00:33:06.319 --> 00:33:10.200
<v Speaker 1>trading and then they go borrow from the ETF, So

533
00:33:10.599 --> 00:33:14.240
<v Speaker 1>a lot of these atfs will lend out their stock

534
00:33:14.839 --> 00:33:18.960
<v Speaker 1>that money's gone into, so it's all a borrow game

535
00:33:19.799 --> 00:33:23.000
<v Speaker 1>and it's all trading off of basis points. Well, Michael's

536
00:33:23.039 --> 00:33:27.599
<v Speaker 1>strategy has so much more liquidity, just like Tesla has

537
00:33:27.680 --> 00:33:31.440
<v Speaker 1>so much more liquidity. I think the only company now

538
00:33:31.519 --> 00:33:33.920
<v Speaker 1>has been Marathon has been able to get some time

539
00:33:33.960 --> 00:33:36.160
<v Speaker 1>of a product, whether money's going in to do the

540
00:33:36.240 --> 00:33:41.079
<v Speaker 1>cover writing program. All these traders are trading between various

541
00:33:41.160 --> 00:33:44.079
<v Speaker 1>pools of capital they call the dark pool, they call

542
00:33:44.200 --> 00:33:48.680
<v Speaker 1>the list of NASDAC pool, and they're trading for basis

543
00:33:48.799 --> 00:33:52.799
<v Speaker 1>points in between all these markets as arbitrage that's going on,

544
00:33:53.680 --> 00:33:57.160
<v Speaker 1>And so what investors have to realize is they're often

545
00:33:57.279 --> 00:34:01.559
<v Speaker 1>leveraged eight to one. Well, some of these funds that

546
00:34:01.640 --> 00:34:05.480
<v Speaker 1>are leverage eight to one, they can only handle volatility

547
00:34:05.960 --> 00:34:09.400
<v Speaker 1>a three to five percent and they're out. They unwind

548
00:34:09.440 --> 00:34:12.280
<v Speaker 1>their position, so Bitcoin starts to sell off of it.

549
00:34:12.599 --> 00:34:18.000
<v Speaker 1>They sell eight times, and so you get this greater downfall.

550
00:34:18.800 --> 00:34:22.559
<v Speaker 1>And for me, it is frustrating because we're falling with

551
00:34:22.760 --> 00:34:26.920
<v Speaker 1>bitcoin prices and but we're growing our revenue, we're growing

552
00:34:26.960 --> 00:34:31.159
<v Speaker 1>our peti hash and so we're funded so I'm very

553
00:34:31.280 --> 00:34:35.079
<v Speaker 1>happy where we're positioned for that growth. But we do

554
00:34:35.320 --> 00:34:38.480
<v Speaker 1>see that the that we're being used as a case.

555
00:34:38.960 --> 00:34:41.880
<v Speaker 1>So some of these funds say, let's take ten crypto

556
00:34:41.960 --> 00:34:44.880
<v Speaker 1>mining companies and we'll short the whole basket to buy

557
00:34:45.000 --> 00:34:50.039
<v Speaker 1>this convertible note. That's what's going on, and it's very

558
00:34:50.199 --> 00:34:53.159
<v Speaker 1>different than micro strategy, which has a big and dollar

559
00:34:53.320 --> 00:34:57.440
<v Speaker 1>ETF that has much more liquidity around it for him

560
00:34:57.519 --> 00:34:58.719
<v Speaker 1>to go do his funding.

561
00:34:59.119 --> 00:35:00.400
<v Speaker 2>God, I appreciate that clarity.

562
00:35:00.679 --> 00:35:03.320
<v Speaker 1>I'm sorry it sounds confusing.

563
00:35:04.079 --> 00:35:07.159
<v Speaker 2>No, it's great insight and I'm definitely learning here. It's

564
00:35:08.639 --> 00:35:11.760
<v Speaker 2>I appreciate that knowledge. I want to get your thoughts

565
00:35:11.920 --> 00:35:15.199
<v Speaker 2>on the bitcoin reserve and what we're seeing globally. We

566
00:35:15.320 --> 00:35:18.440
<v Speaker 2>have Bhutan that has been mining and buying bitcoin as

567
00:35:18.480 --> 00:35:21.199
<v Speaker 2>well Al Salvador. Well, the United States just put up

568
00:35:21.239 --> 00:35:24.840
<v Speaker 2>a big flag that we want to establish as bigcoin reserve. Frank,

569
00:35:24.920 --> 00:35:28.639
<v Speaker 2>do you see central banks in the coming years holding

570
00:35:28.679 --> 00:35:29.880
<v Speaker 2>bitcoin like they do gold.

571
00:35:31.920 --> 00:35:36.840
<v Speaker 1>I think all the terror for right now is creating

572
00:35:36.880 --> 00:35:41.159
<v Speaker 1>a distraction from central banks sitting down around a table

573
00:35:41.239 --> 00:35:44.679
<v Speaker 1>to say we better own some, or government politicians to

574
00:35:44.920 --> 00:35:50.000
<v Speaker 1>own some. And we've seen the unsettling of what's taking

575
00:35:50.039 --> 00:35:55.519
<v Speaker 1>place right now. And when you look at governments, as

576
00:35:56.000 --> 00:35:58.559
<v Speaker 1>I do this as a money manager and I write

577
00:35:58.599 --> 00:36:02.400
<v Speaker 1>this at all my prospectuses, we believe that government policies

578
00:36:02.480 --> 00:36:06.559
<v Speaker 1>are a precursor to change. Thus we monitor and track

579
00:36:07.039 --> 00:36:09.320
<v Speaker 1>basically the g If you look at the G ten

580
00:36:09.480 --> 00:36:16.840
<v Speaker 1>countries based on GDP or population, they will move markets

581
00:36:16.960 --> 00:36:19.320
<v Speaker 1>around the world. So you have to look at either

582
00:36:19.480 --> 00:36:24.039
<v Speaker 1>fiscal or monetary policies. When we see there's a trade

583
00:36:24.119 --> 00:36:30.039
<v Speaker 1>war with tariffs, that's a fiscal policy. Historically, when this

584
00:36:30.199 --> 00:36:34.079
<v Speaker 1>starts to take place globally with the G ten countries,

585
00:36:34.719 --> 00:36:38.800
<v Speaker 1>then the global world starts to shrink in trade and

586
00:36:39.000 --> 00:36:41.199
<v Speaker 1>it's trying to find a balancing until all of a

587
00:36:41.239 --> 00:36:47.840
<v Speaker 1>sudden it changes. This cycle under President Trump is driven

588
00:36:48.079 --> 00:36:51.440
<v Speaker 1>differently than in the thirties. In the thirties it was

589
00:36:51.559 --> 00:36:56.800
<v Speaker 1>driven by farmers. Farmers had a big say in politicians

590
00:36:57.400 --> 00:37:00.960
<v Speaker 1>and voting, and they came when the Hootsmaal teriffs and

591
00:37:01.039 --> 00:37:03.480
<v Speaker 1>it creates this tariff war, and everyone in the world

592
00:37:03.559 --> 00:37:05.719
<v Speaker 1>hated America for a couple of years. Then they had

593
00:37:05.760 --> 00:37:08.079
<v Speaker 1>to redo it all and they start getting back, but

594
00:37:08.360 --> 00:37:13.920
<v Speaker 1>it takes long to rebuild those relationships, and so We

595
00:37:14.039 --> 00:37:16.840
<v Speaker 1>are just in the vortices of this sort of downdraft

596
00:37:17.239 --> 00:37:19.559
<v Speaker 1>of people trying to figure out what will it. Trade

597
00:37:19.599 --> 00:37:22.920
<v Speaker 1>warfs mean, is a legitimacy to it. Who's behind this

598
00:37:23.039 --> 00:37:27.079
<v Speaker 1>in a big way are unionized manufacturers. You saw when

599
00:37:27.119 --> 00:37:29.800
<v Speaker 1>President Trump spoke this week, he brings on the union

600
00:37:29.880 --> 00:37:34.280
<v Speaker 1>bosses to talk about what's happening in manufacturing. So this

601
00:37:34.519 --> 00:37:39.599
<v Speaker 1>is political, there's a rational reason behind it. How it's

602
00:37:39.719 --> 00:37:43.559
<v Speaker 1>delivered is not for me. I think that how you

603
00:37:43.719 --> 00:37:47.920
<v Speaker 1>treat Canada versus how you treat China as the same

604
00:37:48.039 --> 00:37:51.199
<v Speaker 1>blood hammer is just not good. But it is what

605
00:37:51.360 --> 00:37:54.559
<v Speaker 1>it is, and it creates this sort of unwinding in

606
00:37:54.639 --> 00:37:59.280
<v Speaker 1>the capital markets, which has impacted bitcoin prices. Because bitcoin

607
00:37:59.360 --> 00:38:04.880
<v Speaker 1>has now gone mainstream with ETFs its recognizing that transition

608
00:38:05.440 --> 00:38:09.039
<v Speaker 1>of coming into this ecosystem. So I think the adoption

609
00:38:09.239 --> 00:38:12.599
<v Speaker 1>will continue. I think when we get stability on the

610
00:38:12.880 --> 00:38:17.199
<v Speaker 1>teriff dilemma of where things are, that all of a sudden,

611
00:38:17.199 --> 00:38:20.760
<v Speaker 1>other governments will start to acknowledge that. In the interim

612
00:38:21.079 --> 00:38:25.679
<v Speaker 1>they continue to buy gold and the financial calamity, we'll

613
00:38:25.719 --> 00:38:29.400
<v Speaker 1>continue to see central banks buying more gold and gold

614
00:38:29.559 --> 00:38:32.639
<v Speaker 1>is far ow performed this century. The s and P

615
00:38:32.840 --> 00:38:36.599
<v Speaker 1>five hundred and gold has been accepted since they create

616
00:38:36.639 --> 00:38:42.800
<v Speaker 1>the GLD. The bitcoin ETFs are unprecedent how fast they

617
00:38:42.960 --> 00:38:47.000
<v Speaker 1>grew in the acceptance of them as an asset class.

618
00:38:48.320 --> 00:38:50.519
<v Speaker 1>But I still think it's just we're going to have

619
00:38:50.599 --> 00:38:54.360
<v Speaker 1>to get stability on the tariff dilemma before we get

620
00:38:54.400 --> 00:39:00.360
<v Speaker 1>stability on bitcoin pricing mechanism. Then we'll get govern So

621
00:39:00.400 --> 00:39:04.639
<v Speaker 1>I believe it will happen. I believe that we'll start

622
00:39:04.679 --> 00:39:09.519
<v Speaker 1>to see other jurisdictions. You're seeing now Europe raising almost

623
00:39:09.599 --> 00:39:14.320
<v Speaker 1>a trillion dollars to create their own military manufacturing regime

624
00:39:15.280 --> 00:39:20.159
<v Speaker 1>because of the statements made by President Trump. What we've

625
00:39:20.239 --> 00:39:25.719
<v Speaker 1>also seen, in a very quiet way, index owners in

626
00:39:26.000 --> 00:39:29.360
<v Speaker 1>Europe have changed the index holdings of the Magnificent Seven

627
00:39:30.320 --> 00:39:33.960
<v Speaker 1>because of market cap. They grew so big they automatically

628
00:39:34.000 --> 00:39:37.000
<v Speaker 1>signal they can't grow more than eight percent. There can't

629
00:39:37.039 --> 00:39:40.000
<v Speaker 1>be fifteen percent of their indexes for all their pincher funds.

630
00:39:40.320 --> 00:39:43.440
<v Speaker 1>So there's been selling. So we're now feeling that selling

631
00:39:43.519 --> 00:39:49.199
<v Speaker 1>pressure in the stock market, and so it's just a

632
00:39:49.400 --> 00:39:52.400
<v Speaker 1>reset button we're going to go through. I don't think

633
00:39:52.480 --> 00:39:59.199
<v Speaker 1>it slows down the retail the coders and the big

634
00:39:59.280 --> 00:40:02.239
<v Speaker 1>point eCos. I don't think that that gets stented. I

635
00:40:02.360 --> 00:40:05.840
<v Speaker 1>think the use of AI, of how they can make

636
00:40:06.639 --> 00:40:09.599
<v Speaker 1>data centers better, how they can do the nodes better.

637
00:40:09.760 --> 00:40:13.079
<v Speaker 1>I think we're going to see that become more granular.

638
00:40:13.480 --> 00:40:16.880
<v Speaker 1>It's estimated the next five years that we're going to

639
00:40:16.960 --> 00:40:20.079
<v Speaker 1>go from which opened up the concept of AI for

640
00:40:20.159 --> 00:40:24.360
<v Speaker 1>everyone from these open generative use the Internet, so they

641
00:40:24.400 --> 00:40:27.400
<v Speaker 1>thinking all the data just from the Internet. What's happening

642
00:40:27.840 --> 00:40:30.679
<v Speaker 1>is they're going to do nothing but law, nothing but

643
00:40:31.960 --> 00:40:35.639
<v Speaker 1>medical research. There's nine hundred types of cancer. They're going

644
00:40:35.679 --> 00:40:38.719
<v Speaker 1>to become focused and you have become a data engineer

645
00:40:38.920 --> 00:40:42.880
<v Speaker 1>on an expert medicine for one of those cancers using AI,

646
00:40:43.400 --> 00:40:46.000
<v Speaker 1>and you will take all the research papers, et cetera,

647
00:40:46.079 --> 00:40:49.079
<v Speaker 1>start building that database. So we're going to see a

648
00:40:49.199 --> 00:40:53.920
<v Speaker 1>huge growth in data engineers. Besides data scientists making a

649
00:40:53.960 --> 00:40:56.360
<v Speaker 1>lot of money today is going to be the builders,

650
00:40:57.000 --> 00:41:02.440
<v Speaker 1>just like bitcoin datability these days, we're builders. And what

651
00:41:02.599 --> 00:41:04.440
<v Speaker 1>I share with your readers, you got to think about

652
00:41:04.639 --> 00:41:08.960
<v Speaker 1>there's no one central government, but we the people investors

653
00:41:09.039 --> 00:41:12.920
<v Speaker 1>putting money into Hive have built these data centers for

654
00:41:13.119 --> 00:41:16.159
<v Speaker 1>this decentralized mechanize in the world Hive has been the

655
00:41:16.320 --> 00:41:19.400
<v Speaker 1>leader in being all over the world. We're not just

656
00:41:19.599 --> 00:41:22.840
<v Speaker 1>in one state or country. We will now look to

657
00:41:22.920 --> 00:41:28.079
<v Speaker 1>go into America because the government's policy under President Trump

658
00:41:28.480 --> 00:41:32.199
<v Speaker 1>are not vilifying anyone in this in the crypto ecosystem

659
00:41:32.519 --> 00:41:35.119
<v Speaker 1>unless you're a bad actor. The laughter you and I

660
00:41:35.199 --> 00:41:39.639
<v Speaker 1>think that's great, But overall they want to attract. Texas

661
00:41:39.760 --> 00:41:43.599
<v Speaker 1>wants to attract, So we'll look for opportunities in America.

662
00:41:44.199 --> 00:41:48.199
<v Speaker 1>But until the stability was here, which is now, we

663
00:41:48.320 --> 00:41:50.719
<v Speaker 1>have gone all over the world and we are part

664
00:41:50.760 --> 00:41:54.199
<v Speaker 1>of decentralized bitcoint mining and I'm proud of that.

665
00:41:55.320 --> 00:41:57.199
<v Speaker 2>I love it, Frank, I love what Hive was doing.

666
00:41:57.320 --> 00:41:59.960
<v Speaker 2>And you're taking a different approach than the other minor

667
00:42:00.159 --> 00:42:02.800
<v Speaker 2>out there. I know we're coming up on time, so

668
00:42:02.800 --> 00:42:05.119
<v Speaker 2>I have some wrap up questions here for you. First,

669
00:42:05.199 --> 00:42:07.360
<v Speaker 2>if you could create your own metaverse, what would theme be?

670
00:42:08.960 --> 00:42:10.559
<v Speaker 1>What was the question? Sorry? Metaverse?

671
00:42:10.920 --> 00:42:12.760
<v Speaker 2>Yeah, if you could create your own metaverse, put your

672
00:42:12.840 --> 00:42:15.960
<v Speaker 2>Oculus or Apple pro on, you know, what would the

673
00:42:15.960 --> 00:42:16.320
<v Speaker 2>world be?

674
00:42:17.719 --> 00:42:20.639
<v Speaker 1>What would the world be? It'd be just what it

675
00:42:20.880 --> 00:42:26.360
<v Speaker 1>is today and hopefully the process of technology and digital

676
00:42:26.400 --> 00:42:31.679
<v Speaker 1>will take more people out of poverty. The electrifying. What

677
00:42:31.800 --> 00:42:34.960
<v Speaker 1>you're seeing in Ethiopia, the building out the infrastructure, what

678
00:42:35.079 --> 00:42:37.559
<v Speaker 1>we're doing in Paraguay. We're building out the infrastructure, will

679
00:42:37.559 --> 00:42:41.280
<v Speaker 1>put more electricity, more air conditioning in all the kids' schools.

680
00:42:41.320 --> 00:42:44.679
<v Speaker 1>We're already doing that right now. We're putting air conditioning

681
00:42:44.719 --> 00:42:49.199
<v Speaker 1>in a school near our data centers ninety degrees fahrenheit

682
00:42:49.599 --> 00:42:52.440
<v Speaker 1>and there's no air conditioning, so that's one of the

683
00:42:52.519 --> 00:42:56.559
<v Speaker 1>first things. So that helps overall educate people, so that

684
00:42:56.760 --> 00:43:01.480
<v Speaker 1>more people are educated, more people are having a GDP

685
00:43:01.679 --> 00:43:05.199
<v Speaker 1>per capita that allows them to feel they can enjoy

686
00:43:05.280 --> 00:43:09.159
<v Speaker 1>the freedom that bitcoin provides them with. The last thing

687
00:43:09.199 --> 00:43:12.480
<v Speaker 1>I want to share you my journey was realizing in Argentina,

688
00:43:12.559 --> 00:43:16.639
<v Speaker 1>which is so close to Paraguay, is that Argentina in

689
00:43:16.679 --> 00:43:20.440
<v Speaker 1>two thousand and two confiscated all your bank accounts at

690
00:43:20.559 --> 00:43:24.280
<v Speaker 1>US dollars and they still haven't given them back. And

691
00:43:24.440 --> 00:43:28.239
<v Speaker 1>that allowed for tether to grow in many countries. So

692
00:43:28.440 --> 00:43:32.320
<v Speaker 1>when you went there, there's no foreign currency exchange. Banks

693
00:43:32.320 --> 00:43:35.079
<v Speaker 1>will not they will give you paesels at a very

694
00:43:35.400 --> 00:43:37.719
<v Speaker 1>terrible rate, but you have to go in the street

695
00:43:37.800 --> 00:43:40.400
<v Speaker 1>and they'll give you much more. That whole economy has

696
00:43:40.440 --> 00:43:44.119
<v Speaker 1>stayed alive because of twenty five big dollars of cash

697
00:43:44.320 --> 00:43:50.119
<v Speaker 1>and pillows. And it's recognizing that. And the last part

698
00:43:50.199 --> 00:43:52.159
<v Speaker 1>in that the idea that it's going to evolve with

699
00:43:52.280 --> 00:43:55.920
<v Speaker 1>Malay in a very positive way. But coming back to

700
00:43:56.119 --> 00:44:01.360
<v Speaker 1>Paraguay for your listeners, Paraguayans love Americans. I'm going to

701
00:44:01.440 --> 00:44:06.599
<v Speaker 1>repeat this. Paraguayans are not Morduro from Venezuela, They're not

702
00:44:06.800 --> 00:44:10.840
<v Speaker 1>Pedro from Colombia. They love America. And why is that

703
00:44:11.519 --> 00:44:14.599
<v Speaker 1>because there was basically ninety percent of the men were

704
00:44:14.719 --> 00:44:19.079
<v Speaker 1>wiped out in eighteen seventy when Brazil and Argentina and

705
00:44:19.280 --> 00:44:22.360
<v Speaker 1>Uruguy were trying to take over their rich land of soil,

706
00:44:23.079 --> 00:44:28.840
<v Speaker 1>and President Hayes in America solved that problem and Paraguay

707
00:44:29.000 --> 00:44:33.199
<v Speaker 1>to this day celebrates as a national holiday of November twelfth,

708
00:44:33.760 --> 00:44:36.960
<v Speaker 1>and one of the richest state in the country is Hayes.

709
00:44:37.760 --> 00:44:42.679
<v Speaker 1>So they are there today because of America.

710
00:44:43.880 --> 00:44:46.719
<v Speaker 2>Interesting, I didn't know that bit of history. I appreciate

711
00:44:46.800 --> 00:44:49.800
<v Speaker 2>that context, so I'll have to research that. After some

712
00:44:49.960 --> 00:44:52.039
<v Speaker 2>rapid fire questions. Favorite food.

713
00:44:53.719 --> 00:44:54.079
<v Speaker 1>Part of me.

714
00:44:54.639 --> 00:44:57.599
<v Speaker 2>Oh, I have some rapid fire questions for you, such

715
00:44:57.639 --> 00:44:58.960
<v Speaker 2>as what's your favorite food?

716
00:45:00.000 --> 00:45:07.719
<v Speaker 1>Favorite food probably bread, different tastes and different flavors of bread.

717
00:45:08.639 --> 00:45:13.960
<v Speaker 1>Favorite musician or band, whatever reason. Let me see if

718
00:45:13.960 --> 00:45:19.480
<v Speaker 1>I turned up my volume here, I didn't you. I apologize, Oh,

719
00:45:19.559 --> 00:45:20.000
<v Speaker 1>no worries.

720
00:45:20.039 --> 00:45:22.119
<v Speaker 2>Well we'll add it according to you. But a favorite

721
00:45:22.199 --> 00:45:23.039
<v Speaker 2>musician or band.

722
00:45:24.199 --> 00:45:26.079
<v Speaker 1>My favorite musician Earth Wind and Fire.

723
00:45:27.079 --> 00:45:35.159
<v Speaker 2>Favorite movie, favorite movie, Chariots of Fire, favorite book, favorite book.

724
00:45:35.280 --> 00:45:39.559
<v Speaker 1>Well, I'm such a big reader. Oh you have to

725
00:45:39.639 --> 00:45:45.639
<v Speaker 1>fiction non fiction, Tom Clancy. If it's fiction, if it's

726
00:45:46.000 --> 00:45:53.440
<v Speaker 1>a biographies and autobiographies, I would say probably in the sciences,

727
00:45:53.679 --> 00:45:57.000
<v Speaker 1>there's so many of them. But one of the books

728
00:45:57.119 --> 00:46:01.400
<v Speaker 1>is a money Manager. Is a book called Misbehavior of Markets.

729
00:46:04.000 --> 00:46:08.159
<v Speaker 1>The mathematician behind fractals and how it rates to the

730
00:46:08.199 --> 00:46:11.920
<v Speaker 1>stock market, and it comes back from Einstein, so it's

731
00:46:11.960 --> 00:46:17.159
<v Speaker 1>called Misbehavior of Markets. I love books by Malcolm Gladwell

732
00:46:18.320 --> 00:46:21.960
<v Speaker 1>about his simple books. It's easy to read. I find

733
00:46:22.079 --> 00:46:24.440
<v Speaker 1>he does a great job of making a look at

734
00:46:24.480 --> 00:46:28.559
<v Speaker 1>the world differently. And I quote a book that's called

735
00:46:28.639 --> 00:46:33.039
<v Speaker 1>The Wisdom of Crowds. John Sirwaki wrote, it's a wonderful

736
00:46:33.119 --> 00:46:36.639
<v Speaker 1>book about one or crowds. Wise, I'm one or crowds foolish.

737
00:46:38.159 --> 00:46:40.559
<v Speaker 2>Interesting, I'll have to check that one out. It sounds

738
00:46:40.599 --> 00:46:43.239
<v Speaker 2>fascinating because I often talk about herd mentality when it

739
00:46:43.280 --> 00:46:46.360
<v Speaker 2>comes to markets, so I'll definitely check that out. And

740
00:46:46.920 --> 00:46:49.159
<v Speaker 2>when you are not working at high what are you

741
00:46:49.199 --> 00:46:49.679
<v Speaker 2>doing for fun?

742
00:46:51.159 --> 00:46:53.599
<v Speaker 1>I have. I'm blessed with a nine year old daughter

743
00:46:55.320 --> 00:47:00.800
<v Speaker 1>and I love to travel, travel the world and with

744
00:47:01.039 --> 00:47:04.480
<v Speaker 1>her and my wife and I run. I'm a runner.

745
00:47:04.920 --> 00:47:07.280
<v Speaker 1>I just turned seventy and I went out and run

746
00:47:07.400 --> 00:47:10.000
<v Speaker 1>seven miles and I thank God every mile that my

747
00:47:10.079 --> 00:47:11.000
<v Speaker 1>knees are still good.

748
00:47:11.559 --> 00:47:16.360
<v Speaker 2>Wow, that's amazing, Frank, that's inspirational right there. Frank, absolute pleasure.

749
00:47:16.440 --> 00:47:18.199
<v Speaker 2>Love what hive is doing, and I would love to

750
00:47:18.280 --> 00:47:20.079
<v Speaker 2>have you back on in the future. Thank you so

751
00:47:20.199 --> 00:47:20.880
<v Speaker 2>much for joining me.

752
00:47:21.599 --> 00:47:21.880
<v Speaker 1>Thank you