The Pomp Podcast
00:00:00 · Anthony Pompliano
[00:00:00] S0: An abundance of money, dollars, means that the scarcity of Bitcoin is more valuable. AI is an abundance technology. It is going to bring an abundance of dollars. It's gonna bring an abundance of intelligence. It's gonna bring an abundance of information. In a world of abundance, scarcity becomes more valuable. So I am bullish on Bitcoin. I am bullish on gold. I am bullish on land. I am bullish on scarce collectibles. We never talked about this on the podcast. What's going on, guys? Today, got a great conversation with Polina Pompliano. In this conversation, we talk about what's going on with Bitcoin. What... One of my greatest regrets in the Bitcoin industry is. We also get into AI. What's going on with the Anthropic IPO? Why exactly I am very distrustful of a certain group of people who are building a lot of the AI technology? What's going on with the robots? Polina's scared of the kung fu robots. We'll get into that too. And we talk about whether your portfolio is actually gonna do better or worse going into the end of the year, and what exactly I think is so bullish about certain assets. All that and more in this conversation with Polina Pompliano. Alright, guys. Polina is back. Welcome. Thank you. I appreciate it. Our kids turned one. That means as Polina comes back. It's just a year. She's gone for a year. Now you're back. Go ahead. What questions do you have
00:01:08 · Polina Pompliano, Anthony Pompliano
[00:01:08] S1: for missed the people. I think the people have missed me. But the first question is, what the hell is going on with Bitcoin? I leave. It drops. People are claiming it's over. Jason Calacanis,, Polina Pompliano, they're all saying it's dead, and it only went down under 80 k. [00:01:26] S0: Well, we need people to say Bitcoin's going to zero. We need two sides to the market. And if... When everyone says Bitcoin is going up, that means that it is consensus that it's going up, which means that there is much less of a return available because there's no mispricing in the market. But the louder that people are saying that it's going to zero, it's going down, it's over, whatever, you know, narrative they wanna spin, that means that you get a disconnection between the fundamentals and the price. And that is when investors who have conviction are able to capitalize on the opportunity. So every time I hear people saying that stuff, regardless of who it is, I I really like Jason. I like Chamath. They... They've both been incredibly kind to me over the years. I don't agree with them that Bitcoin's going to zero or it's over, but they're smart guys, and maybe they're right. [00:02:12] S1: Who knows? I was gonna say, how do you know the bears are not right?
00:02:15 · Anthony Pompliano
[00:02:15] S0: They could be, but, like, that's the risk that you're taking. And so when you get that dislocation between the fundamentals and, and the narrative, then if you are correct and you have conviction and you are willing to have the courage to deploy capital into the asset, that's how you drive asymmetric return. Now with that said, let's go and look at what are some of the fundamentals. Well, first and foremost is a lot of Bitcoin's value is derived from the security of the network. For years, go back, check the tape, look at the receipts, I have been saying, people would ask, what is Bitcoin backed by? And I would always tell them, the single most valuable commodity in the world, computing power. And people are like, what do you mean computing power? Now everyone's talking about computing power as one of the most valuable commodities in the world. And so Bitcoin is backed by computing power. There's a scarcity of computing power in the world. People are literally scouring the earth and thinking about going to space to get more computing power. Bitcoin is the strongest computer network in the world, which means it's incredibly valuable. It is very secure. It's very decentralized. All of these components. And so that's first and foremost is if you look at hash rate, hash rate is back to almost all time highs, which is fascinating because the Bitcoin miners, many of them started to transition to become HPC or AI data centers. So you took a bunch of the large players and basically took them offline. Mhmm. But Hash rate is coming back and almost back to all time highs. My friend Will Clemente pointed that out. I thought that was a very, important observation. Second thing, where is a net new buyer going to come from in order for price to continue to appreciate? Well, we know that the Bitcoin ETFs have done that. We know that individuals are still continuing to accumulate. But now there is research coming out, I think it was Fidelity that put this out first, is that the perpetual preferreds coming from strategy, strive, etcetera, are producing net new demand for Bitcoin. I think there's over a 135,000 that have been purchased as part of the perpetual prefers. Why is that important? Well, if you can now take a 135,000 Bitcoin off the market and they go into these perpetual preferred vehicles, that is very similar to the ETFs.
00:04:23 · Anthony Pompliano, Polina Pompliano
I think the ETF number is something like 800,000 Bitcoin have gone into the ETFs. So you have almost a million Bitcoin between the ETFs and the perpetual preferreds that have already been taken off the market, and then you have perpetual preferreds that are continuing to increase. Strive took, I think, 5 or 6,000 Bitcoin in the last week and went and purchased it via proceeds from their perpetual preferreds. And so you say, okay. I have computing power and hash rate continuing to increase. I have this narrative dislocation, and I see a net new buyer in the market. Hey, man. I'm excited about Bitcoin. I'm not saying Bitcoin's going to 1,000,000. There's all kinds of crazy price predictions that people are throwing out there. I think Bitcoin goes to 1,000,000 at some point. Just don't think it's gonna happen next year, but I think that Bitcoin looks very attractive here. Because, basically, what you had is you had Bitcoin go from a 125 k down to, let's call it, 60 k or so. So a 50 ish percent drawdown. Great. Then guess what happened? It had this very violent puke, which usually marks the bottom of a bear market, and it has recovered back. And so what you have is you have kind of confirmation that the bear market is likely over. If that's the case, from here back to all time highs is about a 50 return. So at what point is that gonna happen? Is that gonna happen in three months, six months, twelve months, twenty four months, whatever? But a 50% return from here going back to all time highs. But then if you look historically [00:05:46] S1: about to hit the holidays.
00:05:46 · Polina Pompliano, Anthony Pompliano
[00:05:46] S1: about to hit the holidays. [00:05:48] S0: Then if you look at history, the fourth quarter tends to be very strong. [00:05:52] S1: What I'm saying.
00:05:53 · Anthony Pompliano
[00:05:53] S0: If you look at the equity market, the fourth quarter tends to be very strong. But more importantly is the fourth quarter of midterms tend to be even stronger. And so right now, in this 80 to 85 k range, what we're watching is a weakness. People are saying, oh, it's going to zero, all this stuff. Well, in the month of October, when you're going into midterms, usually, there's a lot of concern about there being no certainty. Who's gonna win? Are the Democrats gonna take congress? Are they gonna take the senate? Can the Republicans defend it? What's going on with Trump? JD Vance is running around the country, and he's doing all of these different, you know, speeches and rallies. Trump is campaigning. Which candidates are they gonna back? Are the Democrats gonna be strong enough? Can they exploit any of the mistakes the administer... It's all noise. So what happens is people basically want certainty. As we get close to the midterms and we get certainty, all of a sudden, people say, oh, nothing bad happened. Let me go keep investing my money, and they'll start pouring capital back into the equity market and into the Bitcoin market. And my guess is that going into the end of the year, you're gonna see strength in both equities and Bitcoin, and we're gonna end the year higher than where we are right now in both of those markets. So it goes back to if you have fundamentals, if you have seasonality type based stuff, and you have a very clear reason why the narrative has dislocated from those fundamentals, that's when you should be excited. And I think going back to the people calling it, going to zero, all this stuff, hey. Thank you. I appreciate all of that because it actually provides the opportunity. And if you look at... Again, what have we been doing in the public company for the last couple of months? We have a lot of Bitcoin. We've been selling Bitcoin at NAV and buying back shares, which is us buying more exposure. We're cranking on the Bitcoin exposure for every shareholder. We're trying to get more Bitcoin exposure because I have a generally bullish, view as to Bitcoin's future over the next, you know, twelve months or so.