SaaS末日、18个月熊市与Bitcoin对量子计算

The revenues from all these companies are basically going to get back in and be reinvested in the megacaps that can actually create them internally. This is the best trade of all time. We didn't build anything useful.

All in all, my best guess is that it's a 9- to 18-month bear market before things get better.

Oh my fucking God.

6 years of MicroStrategy buying isn't even 75% of what will be unlocked when quantum computing comes, which it will. It's an inevitability. Really, what we have to hope for is—

Yo, what is going on, Jonah? How are we doing?

How are we doing, Avi?

We're great. Look, we've got 70 people on. Jonah is looks-maxing.

Oh, yeah. Another thing I shared.

What the hell?

You see this warm, suntanned skin tone of mine right now?

Yeah.

It's not really me. I'm using a video filter.

Oh, you're using a filter. This is all me, baby. This is all you're going to get.

Yeah.

No filters here.

You're naturally tan. I'm naturally pink when I'm cold and see-through when I'm not cold.

Yeah, that's—

The downside to being 100% Ashkenazi Jew, you know.

Yeah, exactly. Actually, I got it backwards.

I'm see-through when I'm cold and pink when I'm warm. That's how I roll.

All right. Now that these are all the real ones, everyone on this podcast right now, I want you to know that you're an absolute real one. We're going to tell you guys something that we're not going to tell anyone else after I post this tweet. Do you guys remember the terminal that we were working on?

I remember.

You, Jonah, you remember the terminal that we're working on? We're pushing out a major update in the next 2 to 3 weeks, and I think it's going to be a very competitive product. The token is currently trading at an $800,000 market cap. That's just for you guys.

Let's talk about your house in Puerto Rico for a second. What's out there? Is there a pool?

There is no pool, unfortunately. That's just the patio. It's a nice patio. I had it repainted about a year ago, this nice blue.

Beautiful.

Yeah, no, it's really nice.

I have a shelf, too. Nice copy of the Talmud you've got going on there, or whatever that is.

It's too small.

No, it's not the Talmud.

These are all the books from my childhood. I've got the Harry Potter series, the Artemis Fowl series, The Alchemist for the real ones who know that, and this book. You would love this book, Jonah. Hold on. Check this out.

These are probably 2 of your favorite books in the world. The book club is one of my favorite segments on the show.

These are probably the best books in the world.

I love both of those.

I knew you would love this. You were the one who told me to get this.

I'm pretty sure you also told me to get this one, but—

I did.

Yeah.

The Bible and The World for Sale.

This is a phenomenal book. It's a riveting piece of text. It really is.

It's incredible. The little table at the back that shows Vitol's earnings—I can verify that. Or maybe it's at the front; I forget which. It's either at the very first or very last page. Those earnings are real. I can verify that I was up in there, and those numbers check out.

Yeah, the net profits are pretty insane. They published a book just before the wild ones started. The thing is that Glencore had a lot of years where they just lost money.

1. Own vs Rent And SaaS Apocalypse

Yeah, that's because they decided—basically, there's the old adage: if it flies, fucks, or floats, you're supposed to rent, not buy. Obviously, that's foul-mouthed, and I would never coin that phrase myself. But an additional corollary to that theorem in the world of trading is that if it's a hard asset, you're also supposed to rent, not buy. Those things depreciate.

What Glencore did wrong was, unlike Vitol, which is asset-light, Vitol rents everything. They have the world's second-largest navy—but it's all rented boats, right? Behind the United States, sorry. They don't own any ships for obvious reasons. Glencore went the opposite direction and went super asset-heavy. It bought a bunch of mines, assets, cargoes, and all sorts of crazy things, and that basically diminished its returns to the shareholders.

This is what happens when you go from being a private partnership to a public company. Everybody at Glencore cashed out around 2011 or 2012, or whenever the IPO was, minted a bunch of billionaires and centimillionaires, and then the company went asset-heavy and did the whole quarterly-earnings thing. Basically, the best model for these companies is asset-light, with majority ownership held by employees, not outside shareholders. Then Glencore flipped that, and that's what happened there.

Yeah, that makes a ton of sense. That's actually a good segue into 2 things. One, I'm pretty sure Twitter's down, which is why we have zero viewers right now. I don't know if Twitter's working on your end, but it just totally crapped itself on my end.

Twitter's been down all morning.

Yeah, Twitter was down all morning.

I think it's back down now, so we're—

Because they were bragging about how Facebook has 150,000 employees and they have 30,000. It's like, yeah, this sort of—thanks, Twitter. Good job.

This is actually a good segue, and I'm curious about your take on this because I wonder if there's a corollary between what's happening with the capex spending of these massive tech companies and what you just said, which is that it's better to rent than to own. All of these companies are saying, "Hey, we're going to build these massive data centers and spend a lot of money because we want to own the data centers, because we think it's going to be smart to own them."

There's also the other argument, which is that they should not be spending all of this money building out data centers. They should basically be going out to contractors that will own the data centers themselves and rent them, just in case these data centers massively depreciate at some point in the future. It's much better to rent than it is to buy, right? Than it is to actually own them.

2. Bitcoin Quantum FUD

One of the things that I think a lot of people are confused about right now is whether they're actually going to follow through on this, whether it's better for them to rent, and whether they're going to walk back their capex spending. That would be very good for their stock prices because it would mean stock buybacks could return, but it would be very bad for all of the stocks that have done very well recently in the data-center world. This is kind of a middling ground here. We're not really sure what's happening, but I'm curious about your take.

Yeah, no, it's a great point you bring up, and it's sort of nuanced. At the end of the day, every company is a trading company. Google kind of trades ads and compute. Glencore trades physical commodities. There's a clear distinction regarding when it makes sense to own rather than rent.

Actually, let me take an even further step back. Let's use the oil industry as an analog because it's 100 years old, per The Prize, the book you just held up, and there's a long precedent there. There are 3 components of any industry in oil. You have production, which is called upstream. Then you have trading and intermediation—the middlemen—which is called midstream. Then you have sales and distribution, which is called downstream.

In oil, downstream is refining and then taking the refined products and selling them at the rack to trucks, at the pump to drivers, and in jet-fuel tanks at airports and stuff. Basically, upstream, midstream, downstream.

If you're just a midstream company, buying assets is the stupidest thing you can do. It feels like a honey trap that everybody just falls for. If you're an upstream company, you cannot rent. If you're digging stuff out of the ground or making things, you have to own a factory. You can't rent a factory—I guess you could kind of go with a contract manufacturer or own royalties from streams of oil.

Like it happens, but the big, big mega businesses own. Downstream, you also have to own, right? Then we're going to take this analogy back into tech and try to draw some trading conclusions.

Downstream, you've got to own a refinery. You've got to own the means of production, sales, and distribution. Otherwise, you're just going to be drop-shipping. Drop-shipping only gets you so far, right? You have to own those channels.

Basically, where midstream companies get tripped up is when they try to go from being a Glencore to an ExxonMobil, which makes sense. You want to expand horizontally into the whole market and become this vertically integrated behemoth. If you don't go all the way, you just end up as an asset-heavy midstream trading company, and that's a terrible business. The companies that succeed, like BP and Shell, bought the assets and followed through.

So, going to data centers, it's a very interesting problem. You have data center companies like CoreWeave, which I think are kind of a bad bet in the long run, for a variety of reasons, depreciation being the number-one factor. And also—I don't know, maybe not. We could talk through it.

If you're Google, Google is kind of like the Exxon. Meta, Google, Amazon, and Microsoft—these are like the ExxonMobils of the compute world. Given that they are vertically integrated, I think it does make sense for them to own the assets.

The reason why it makes sense for a vertically integrated company to own assets, whereas it does not make sense for a midstream company to own assets, is because they extract the full optionality out of those assets. They can pull from their supply during times of shortage. They can push into their sources of demand that they own during times of excess. Those assets actually produce more optionality, which justifies them.

If you're just an asset owner like CoreWeave, there are going to be real cycles for that business, like a midstream asset owner. So, basically, yeah, I agree. Jim Chanos said CoreWeave is basically a landlord for chips and that their assets depreciate rapidly. That would be a scary business to be in, just amassing physical piles of chips and wires and sitting on them.

The only major difference might be: Have we reached the pinnacle of chip development? Is chip development going to slow down a ton because we've reached physical constraints on what you can do with these chips? This is actually an interesting question because it's kind of what happened in the Bitcoin-mining space.

Bitcoin miners were horrific investments early on because the rate of development was super, super fast. Every year, they were coming out with new miners, and then suddenly the pace slows down. The development timelines for Bitcoin miners are pretty long now because we've reached literal physical constraints on what you can do with these chips.

Yeah.

It's like Bitcoin-mining difficulty is just skyrocketing.

It's skyrocketing, and it's not because of chip development and faster chips. It's because people just keep amassing more. We're producing more miners, right? Whereas in the past, the difficulty was skyrocketing because a new chip would come out and 20× the efficiency of a Bitcoin miner.

So the question is: Does it become a better business over time as chips become more stagnant because we've reached physical constraints?

The way that I view it is that amassing piles of hardware in data centers is going to converge toward the returns of a real estate landlord business, like a commercial real estate empire, which I guess is good business, right? They're not going to go bankrupt. Glencore didn't either. But it's not going to be the hyper-growth, exciting thing to do because, again, you're a midstream company and you're just a hard-asset owner.

You're not nimbly renting the assets. You need to use high leverage to basically surf some megatrend, to surf some tsunami wave, kind of like Bitcoin miners weren't a great business until they pivoted to AI. Maybe there will be a next big thing that CoreWeave can latch on to after AI, but somehow I don't think so.

I think this is the final wave in the set, to stick with my surfing analogy. Once they've ridden that out, it's going to go down. I wouldn't be long CoreWeave here, that's for sure.

However, I don't think it's a bad idea for Microsoft and Google and the other hyperscalers to be amassing physical infrastructure because they're actually going to need it for a long time for inference, and there's tremendous optionality in there.

Let's say that we go into a glut of compute. There is never going to be a shortage of demand from their internal needs, right? Meta advertising and just usage.

Google will always have a place to put the compute. This is why Exxon has assets, right? When there's a glut of oil, they can just shove it into their refineries and tell their refineries, “You can't buy from anybody else.”

Same thing with Google owning a data center. If the external demand for compute dies down, they'll still have internal demand for compute that far outstrips their physical infrastructure's ability to provide it. So it makes sense for them to own. Are you kind of getting what I'm—

3. 18-Month Crypto Bear Market?

Yeah. No, I get what you're saying. I also think a big part of it is that they just have the money—

Yeah.

—to basically eat the low times, like eat the lean times. But I do think that the amount of money they're spending is sort of making a bet on exponential growth of demand. If we don't see that exponential growth for an extended period of time, I think we could see some issues.

I'm of the opinion that it's possible we're actually going to see some walkbacks in the capex spending that these companies are doing. Basically, everyone's gotten so nervous. I mean, Google's not trading at 300. Meta has been doing terribly. They've been caught up in this rout of tech companies across the board.

But I don't think that's very fair. I think this is actually a pretty good time to go buy Google now. This is a pretty good time to go buy Meta. It's a pretty good time to go buy all these megacap tech companies.

One thing that we're not quite appreciating is just how horrible the SaaS apocalypse has been. What it also means for the large-cap companies is that everyone who pays insane amounts of money to use Atlassian, to use Intuit, to use Workday, and the amount of money spent on Slack, Adobe, and Salesforce—the companies that can cut these people out now because of AI, the speed of AI development, and what you can build internally are going to save—there's going to be tremendous savings.

The revenues from all these companies are basically going to get back in and be reinvested in the megacaps that can actually create them internally. This is the best trade of all time right now.

I mean, it's already sort of played out. I don't know if you want to take the short side here. I don't know if you want to continue to short Adobe, down 25%, or continue to short Atlassian, down 47% year to date, right?

Basically, what you're going to see is that the revenues that were going to those companies are going to be absorbed into savings from Google, and we're going to see the profit go up. This is what people talk about when they say AI is going to improve productivity, streamline companies, and basically increase margins.

It's all this. It's all the tens of millions, hundreds of millions of dollars that are spent on these companies, which produce billions of dollars of revenue in total, that are going to collapse now. I think a lot of these things are going to be built in-house.

Salesforce is a great example of this. In the next 3 years, I guarantee that a lot of people are getting rid of Salesforce because they've just built their own internal tools. So this is the SaaS apocalypse to me. What everyone's talking about in all these shorts is really relegated to the B2B area, to these large companies that can afford to develop in-house.

But B2C, I think, is a little bit safer just because the average consumer is really dumb. Once they buy into a product, it's quite difficult for them to switch.

And distribution is still key. When it comes to the consumer, the consumer is never going to make the calculation: Could I build this myself, or should I spend money to pay for this thing?

Businesses are making that calculation every single time they sign up for a product: Should I build this in-house, or should I buy this from somebody right off the shelf? This is exactly the discussion that we were having. Do you build it yourself? Do you own it, or do you rent it?

For the most part, because there's been such a high bar for entry for building software, and because it's so expensive, the answer is rent.

You want to rent because you don't want to—you know, it's inefficient to build it yourself. But now I think it's very efficient to build it yourself. So that's sort of—I’m still on this trade. I think you buy the megacaps, you short everything else. You short the service providers to the megacaps right now because they're just going to figure out how to do everything themselves at this point. I think that's actually probably a pretty actionable trade.

The Salesforce stock price—I mean, you've got to be careful, though. The Salesforce stock price is almost down to the 2023 lows. It's trading at $189 right now. Its all-time high was at the beginning of 2025; it was $362 when Trump got elected, the day after. Now it's down like 50%.

The way that you short generally is you wait for the bubble collapse to occur, but then you don't short on the way down, right? What you do is wait. At some point, there's going to be a violent bounce. But if you believe strongly that you're in a secular downtrend, then that's your entry, right? Salesforce is actually not almost at the 2022 lows. The 2022 lows are $131; it's currently at $190.

But basically, what you wait for is a 1- to 2-week period where the performance is up like 15% to 20% on these companies, and then you go short, right? That's the way that you manage a short: you want to short these things in strength. So, if I'm constructing a trade here, I'm definitely still a buyer of Google. I'm still a buyer of Amazon. I'm a buyer of Microsoft. I'm not telling you to short Salesforce and Atlassian here, but I do think this is a trend that's going to continue for an extended period of time.

I view this as the alt-market blowup equivalent for crypto, right? When you hit a bear market, the shit that is useless goes to zero. The thing is, it's actually easier to short Salesforce, Atlassian, and Intuit because they actually have revenues that you can look at.

4. Prediction Markets vs Crypto

So all you have to do is say, “Okay, let's see. Have their revenues actually gone down? Are people actually canceling services?” If you don't think that there's anything to reverse that trend, these are phenomenal shorts. I like your framework for shorting stuff. At the beginning of the year, you were talking about shorting meme coins because they just bounced.

Looking at my least favorite one ever, WIF—or my favorite one to hate, the one I love to hate—it traded from $0.25 up to $0.50, and now it's trading at $0.23. In these violent bear markets, you get squeezes. If you're just sitting there ready, with the hammer in your hand, ready to play some whack-a-mole, you can make some money. You can whack some moles.

Yeah, I mean, it's really the same trade as the crypto trade.

How is the crypto trade going, by the way?

I think—I sound like a broken record. You just got to wait it out. It's not the hot item right now.

No, I mean, our daddy Mike Ippolito tweeted something. Let me try to pull it up here. He's saying he expects crypto to go into a 9-month minimum bear market. Let's see here. I'm going to read his post because I think it's relevant, and I want to talk about it with you. I'm kind of wondering the same thing.

“Some thoughts on this market. I think it's likely we're entering a full-on crypto winter. I'm also open to the idea that this bear will be as bad as 2022, perhaps even as bad as 2019. The short-term reason for this is that the industry is in an air gap created by unsustainable valuations and regulation. We've been pounding that table on this podcast for years.

“Historically, valuations in crypto have been driven by the hot ball of money. Money comes in, and because it was literally illegal to generate value for tokens, revenue and cash flows were entirely disregarded. Prices were set by the amount of capital times the supply of tokens. The sexier and more risk-on it was, the higher it went.

“There are 2 things that are different this time. The biggest difference is that it's clear that there will be a regulated path for crypto projects. This is—I’m skipping ahead—this is good, but it presents an obvious problem for protocols valued purely based on speculation. Once there is a regulated way to generate cash flows and not get thrown in jail, that is all the market will want.

“So what is confusing many investors and founders right now is that fundamentals are growing, but tokens are still selling off. This is because we're resetting how valuations will work, and the starting price for almost every project was way too high. We said that on this podcast. Additionally, crypto is getting absolutely mogged by AI. The last couple of years of memecoin stupidity are catching up with us, and unfortunately, we didn't build anything useful.

“All in all, my best guess is it's a 9- to 18-month bear market before things get better.”

Oh my fucking god. Avi, what do you think?

Yeah, I think that's pretty reasonable, but it sort of depends on what you think of when you say bear market, right? There will obviously, in my opinion, be a bear market for really shitty, terrible assets. But you have things like Morpho and things like Uniswap that are getting bought up by large institutions right now. You have things like Hyperliquid that are generating real capital.

I'm crossing my fingers that one day Syrup will stop sucking ass and actually start going up again. But these things are actually generating real revenues and becoming real companies. We've talked about this ad nauseam in the past, and I don't really want to beat a dead horse, but this is the dot-com implosion moment where your Pets.com goes to zero, but everything else ends up going up, right?

All the stuff that is actually a good company, run by smart people who are looking to exist in 5 years, while most of these crypto projects are just looking for a quick buck—the things that are actually trying to build—I think are very, very, very good trades. Right now, what's happening is they're being dragged down by the broader market. They're being dragged down by this idea of a bear market, right?

I mean, Hype's trading as much volume as Coinbase now. That's insane. Hype's not valued nearly where Coinbase is.

No. Coinbase—although they're converging quickly. Holy moly. Coinbase is just imploding. You know what? You're right. This really is the technology market in 2001. Pets.com is dying, and Amazon is getting hit in sympathy.

But the next 25 years are pretty bright for the projects that actually build. Another one that I didn't want to leave out: my favorite, Aerodrome—or, as my Italian and French friends pronounce it, Herodrome. I think it's got a lot of upside from here. It's just a question of when the good stuff stops getting dragged down by the bad.

Mike Ippolito says 9 to 18 months. To me, that just feels like—and I don't blame him, because I pull stuff out of my ass all the time—that feels like a time frame that's been pulled out of his ass. Now, I don't have any issue with that. I just can't help but wonder, and we should probably discuss why: what is there?

In the past, there were catalysts. It was like, okay, well, Luna and FTX just blew up and volumes are down 90%. People probably won't reengage for at least a few months, maybe years. Here, it's like, what? All the regulatory and narrative backdrop is so constructive. Why should it take 18 months for the valuation convergence to occur?

There are huge trades here: short garbage against being long good stuff. Short Coinbase, long Hyperliquid; short WIF, long Aerodrome. What am I missing? Why does it take 18 months for the market to correct, or is Mike Ippolito right?

I think what happens here—well, there are sort of 2 things that we need to talk about. If you're an investor and you're just thinking about, “How do I think about trading the crypto market?” 2 things are true.

One is that we're having a massive blowup moment, and this has been talked about. It's probably going to take some time to wash out all of the exuberance that we experienced. I think we pulled forward a tremendous amount of value just because of what Trump did: pumping up the crypto markets, launching his TRUMP coin, launching the grifty-ass Melania coin, basically trying to bring in as much money as they possibly can and then exit the nonsense.

What is also true is that animal spirits always return. They always return. All you need in order to get a massive, massive, massive rally from altcoins, from crypto as a whole, from memecoins, from any of this shit, is simply for valuations to go low enough to the point where it doesn't take that much capital to send them higher.

Then suddenly you're going to start to see, like, if PEPE goes to $50 million or $100 million, it's probably going to 5x to 10x at some point after that because I don't think animal spirits go away completely. Over time, it trends to zero. But there's always going to be pockets of exuberance where everyone floods into the market. It's very simple.

It's very monkey-brained. It's always monkey brain. Yeah, Melania.

I'm sorry. I just had to share a Melania coin while we're here. That's all I have for now. Oh, here. Let me remove it from the presentation. Sorry to interrupt your rant there, Avi.

That was good, Jonah. I'm happy you brought that up.

No, the animal spirits are back. Also, another piece of evidence of this is prediction markets. To me, prediction markets are the new crypto.

5. 1000x Fam And Playing The Long Game

People have gotten a little worn out and drained from betting on random meme coins and tokens, you know, 2021 and 2017-style ICOs that have no connection to any business, if there is even a business—especially the 2017 ones. It's like, this is Python for crypto on the moon, for when future spacefaring civilizations will need that. This is the coin that they will use. Obviously, people would gamble on that stuff back then.

In 2021, there had to be the veneer of a business. No businesses materialized except for gambling ones. Now I think prediction markets are the new altcoins, right? Why bet on some random crypto project? Why, even if it's a halfway decent one, bet on LayerZero, Monad, or Gonad, or Sei, or Sui, or Aptos, when you can gamble on how many times Bad Bunny will grab his junk at the Super Bowl halftime show?

Right? Like, 9 bid at 16, lift the offer, you hit the bid. Prediction markets are the new shitcoins. I think a lot of attention and gambling money has just shifted to other sources of sugar rush online.

Yeah, it'll come back. The very specific reason that it'll come back is because prediction markets are not a cohesive entity. They're not a cohesive thing where everyone on the prediction market is making money together because the markets are correlated.

Community building there.

There's no community building. There's really nothing. Honestly, it's very, very, very rare—obviously, one-in-100 events happen. The density of 10x to 100x events that occur when crypto is hot is way higher than it will ever be on prediction markets. Obviously, crypto is—

I mean, imagine this: crypto is the equivalent of going to a casino and losing over and over and over and over. But then, for a 15-minute period, everyone's slot machine is hitting. Everyone is making so much money. Everybody is buying bottles of champagne and sending them to one another.

It's like Ocean's Eleven.

You're just having the greatest time of your life. That is what crypto is. That is the value of crypto. It's this weird niche game. I'm genuinely serious.

It's so real. It's so real. I've never heard of it that way. It is like when everybody wins at the same time.

It's just so much more fun to all make money with your friends. That is the core value proposition of crypto. It is not a tool for gambling. It is a tool for gambling with your friends, making a ton of money with your friends, and being part of a community that just minted millions of dollars for God knows what reason. Prediction markets will never let me jump in.

They'll never be able to replicate that. Who's all winning together? Nobody. These events are completely uncorrelated.

They're zero-sum also. That's the difference. Crypto—

Community building there.

There's no community building.

No, it's zero-sum in some ways. Crypto is zero-sum if you think of it as a closed system. If you think that the communities built by crypto can bring outside money—ex-crypto money—into crypto and generate immigration, then it's not zero-sum, the way that the United States of America is not zero-sum.

An individual prediction market is literally a zero-sum game. Maybe the market cap of money invested in prediction markets continues to grow, but each one is a zero-sum game. The reason why I think prediction markets will drain retail a lot faster than crypto did is precisely for the reason you just described. There are sharps at the tables of these prediction markets. There are people who have actually talked to Bad Bunny before the halftime show, and he's like—

They're like, “Hola, I'm going to grab my junk 25 times. Take the over.” Right?

What? Why are you obsessed with the idea of Bad Bunny grabbing his junk?

Because he did. He did. It was very inappropriate for my children. I had to turn it off. It bothered me, so now I'm harping on it.

You're just stuck on this point, like he just kept grabbing his junk.

It's like, “Come on, man. It's the Super Bowl. Don't do it. I've got a 3-year-old girl. Stop it, Bad Bunny.”

Every time I exit my Jew bubble—honestly, I'm in my little religious Jew bubble in L.A.—everything's sort of the way I'm used to it. Every time I open the shades and peek out a little bit, I'm more and more horrified by what's going on in society. It feels like a total alien invasion is taking place that I'm just sheltering myself from.

Anyway, my point here is that it's a zero-sum game, and every single one of these markets has some insider who actually knows the outcome of these bets. They will drain retail a lot faster than retail got drained by community-style investing and vibes and the sort of grand vision that you have when you sit down at the craps table of crypto.

Except the difference between a craps table and crypto is that the casino doesn't allocate the bet size, right? Money can come in ad infinitum in crypto. So, yeah, man, I think—

I think so, and this is what I would advocate for: You really shouldn't write crypto off. I'll explain that more later. You can't write crypto off because it will always come back. No matter what happens, it will always come back because all it has to do is go down enough so that people are willing to gamble on it again. It can't go to zero. That's the thing.

Actually, people are coming back on the podcast now. We're up to 2,000, which is still very low, unfortunately. Twitter breaking really left us with you guys. I'm very happy that you guys are here, and I'm very happy that you're listening to this podcast because, again, it means that you guys are the real ones. You guys are the ones who thought through Twitter breaking down. Maybe you're even on YouTube. If you're watching on Twitch, that's crazy. There's 1 person watching on Twitch. I don't know who that is. Shout-out to you.

Yeah.

That's nuts. Who the hell watches this on Twitch?

There was a guy on Twitch who added something in the comments. He asked if there are Black Jews, and I wrote, “Of course there are Black Jews.” Amari—

That guy's not on Twitch.

Oh.

What is it?

Yeah, here we go. “Avi looks Black in this light.”

Yeah, that guy's on YouTube. I love our YouTube listeners. Those guys are the peak.

Those guys are the real ones, actually.

I might have to take it back because I don't know how many times I've explained this. This is just what my eyes look like.

Yeah.

I swear to God, I got good sleep last night. I don't know what to tell you.

Maybe you should try some cosmetics by Kylie—Kylie Cosmetics. You can just apply a little eye, whatever it is, touch-up.

You think I want to wear makeup?

I put on a video filter. We may as well just totally cartoon ourselves and become— instead of 2 Jews talking about crypto, we could become 2 Korean girls talking about crypto.

Nothing on Instagram is real anymore.

What would be a crazy crossover?

Crazy crossover.

If we did a “Get Ready With Me” and talked about crypto, what we would do is be on 1 side of the screen, and we'd get some girl to get on the other side of the screen. She'd be putting on makeup, and we would just be talking about crypto. The audio would be solely crypto, but it would be some girl getting ready.

I think that would work on TikTok. If we ever want to go for the TikTok, I think that's what we've got to do. I actually had a group of TikTokers that tried to rent my house back in 2020 during COVID.

The sad thing is, it actually would have been preferable to the tenant I selected, who's obviously the guy. But my real estate agent was like, “All right, I have to show every offer to a landlord.”

It’s legally required in the state of California. I don’t recommend that you take this. Let me caveat what I’m about to say with that: a group of 18 TikTokers want to live in your house.

Full disclosure, they’ll be skateboarding off your roof into your pool, crashing Lamborghinis into whatever the front staircase is. They’ll repair it. Here’s an insurance deal. And the answer was no.

Trying to tie this back into investing, crypto right now is being handed from OGs to TradFi. The two of us are sort of like the real estate agent podcasting to TradFi, saying, “Guys, crypto’s offering itself to you right now. It’s a bunch of 18-year-olds that want to crash their Lambos into your swimming pool and skateboard all over your house and stairs. Do you want it?”

TradFi is just like, “Maybe we’re going to be a little selective here and try to DCA into Bitcoin over the next 72 months instead of just FOMOing your bags right now.” I think that’s making life very difficult for people who work in crypto, especially crypto VCs. I don’t know how they’re coping right now. That’s got to be a very difficult job at the moment—tricky to navigate.

Chris Dixon posted a long thing about it. I basically think the only way to invest in crypto here is to play the long game. It’s almost impossible to trade the short term unless you’re pairs trading it, in which case, shout-out to Pair Protocol and the thing they’re doing on Hyperliquid. That’s probably the only way to actively trade crypto here without getting annihilated.

I think that’s unfortunately fair. Yeah, maybe go sign up for Pair Protocol and just start putting on all these pair trades.

The issue, obviously, is that the interest right now is dead. I’ve been talking about this for a while: I have my framework. It’s called value versus momentum, and we definitely have downward momentum. The question is, where’s the value?

My take is that there’s value at $60K to $64K per BTC, and that’s where I would look at accumulating long term. Maybe we get down to $52K, at which case you really can back up the truck. But candidly, that’s what I said at $80K.

I was like, “I think this will be good.” And then we traded straight back from $90K to $93K, back to $86K, and you’re like, “Okay, I guess there are infinite sellers.” There’s no real narrative for Bitcoin to go up right now because it used to be the gold narrative, and I think it’s decoupled from gold for too long for that gold narrative to come back.

It really just has to be a global liquidity narrative. It has to be, once again, the fastest horse in an all-up market. We have to be in a market where everything is doing well, where liquidity is getting pumped into the system and animal spirits are back, for it to reverse. Or we need to be at a price where basically everyone looks at it and goes, “That’s a massive bargain.”

Yep.

People are doing that, by the way, even super far away from that. I do think the quantum FUD—

We’ve got to talk about that, too. That was my next comment: quantum FUD.

We’ve got to talk about the quantum FUD. People keep asking me about that.

6. 1000x Terminal

I can confirm the quantum FUD is real. [snorts]

To explain what the quantum FUD is, there are really 2 different levels of fear around quantum hurting Bitcoin. The first level of fear is if quantum computing gets to the level that it needs to, which it currently is very far away from, and most experts think that it will take at least until 2030 or 2035 to get the qubits up to the level needed to actually crack the encryption that’s used to create private keys.

The fear is that if we get quantum computing, all private keys as they stand right now are crackable, which means that your Bitcoin as it stands right now is not safe. There are a lot of people out there saying that when quantum computing comes out, Bitcoin will go to zero because everyone’s Bitcoin is going to get stolen and nuked.

That’s going to happen because Bitcoin developers are not going to introduce quantum-resistant Bitcoin accounts. They’re not going to develop it in time. They’re sticking their head in the sand, and—

That’s going to be the catastrophic end of Bitcoin.

That is not true. I think that the Bitcoin developers will introduce quantum-resistant accounts, and we will introduce a quantum-resistant mining algorithm, which is actually less of a fear than quantum-resistant accounts because quantum computing has a much harder time breaking SHA-256 than breaking randomly generated private keys. But that’s another discussion.

I think we will fix that. The main actual issue, which is why people are scared, is that in order to have a quantum-resistant Bitcoin account, you have to move your Bitcoin to a new address. You have to generate an entirely new private key and move your Bitcoin over.

Any Bitcoin that isn’t moved, that sits in an old address, is vulnerable to quantum computing. There are 1 million Bitcoin that Satoshi owns sitting in a non-quantum-resistant Bitcoin address. That means the moment the first quantum computer is created, there’s a massive bounty out there, and 4 million Bitcoin will immediately be sold, probably on the market, or taken control of.

For context, MicroStrategy has been operating and buying Bitcoin for the last 6 years, and they’ve accumulated 288,000 Bitcoin. Six years of MicroStrategy buying is not even 7.5% of what will be unlocked when quantum computing comes, which it will. It’s an inevitability.

Really, what we have to hope for is that the first people to crack quantum computing are not massively greedy, and they crack Bitcoin, crack that private key, and burn the coins or something. The other possibility is that we fork Bitcoin.

We soft-fork Bitcoin, and those coins get locked forever. They get lost. They basically get burned. They get sent to a new address, and they don’t exist anymore. They’re gone. The issue here is that if you fork Bitcoin, obviously you’re saying Bitcoin’s no longer immutable. We’ve had this happen before with the BCH and BTC hard fork.

BSV.

And BSV. But what’s happened? The forks died. BCH died.

Well, dude, sorry. This is exactly what’s going to happen. Let me just give you the play-by-play.

Quantum computing will start to get threatening. We don’t know whether it’s in 2 years or 20, but before the chain gets hacked, the devs will fork Bitcoin. The current Bitcoin that you and I have in our cold wallets will become Bitcoin Pre-Quantum, Bitcoin Pre, and then you will get issued Bitcoin Post-Quantum, just like there was the BCH fork and the BSV fork.

Bitcoin Pre will trend toward zero, just like BSV and BCH have, and Bitcoin Post will just keep on trucking, pick up at the same price, and do whatever Bitcoin Pre would have done if it weren’t for the quantum threat. The other thing is that the quantum threat applies to your JPMorgan account, your stocks, your bonds, your grandma’s stocks and bonds.

Society has just got to fork everything and switch it between Pre and Post. There will be entrepreneurial hackers out there who steal grandma’s pre-quantum assets and sell them off while they still have value. But honestly, I just don’t see a problem here.

This has literally happened already. Every chain we care about has been forked—I guess not Solana, but the big chains have been forked. ETH has been forked. This is just normal for crypto. There is no reason to fear.

Even if you’re a Bitcoin Pre-Quantum maximalist, and you don’t care about BCH and BSV, you just care about the current fork of Bitcoin that we’re all trading, which is not going to zero, and you’re worried that somebody’s going to steal Satoshi’s coins with a quantum computer and sell them to zero, I guess the big reveal of the show—we’ve only got 3 minutes left before the end of the show—is that Satoshi is Mike Epilo [?], and he’s smart enough to move his coins over. He’s going to protect us, and we’ll be fine, basically.

Thank you, Mike. We appreciate your sacrifice.

We appreciate you. Thank you.

Anyway, this was a fun show. This was good.

It’s always fun. The hour went by like that.

We’ve got to—I want to end with one thing now that we have some listeners that have gathered. As you know, Jonah and I have been working on the 1000x terminal. So, if you go into your browser and type in 1000x.money, this is the terminal that we’ve put together. Unfortunately, our dev broke his arm, and for the last 2 months we’ve been struggling to push out a good product. We think we found a pretty amazing solution and partnered with a group that has built an internal LLM that is really, really, really good, and they need a good distribution partner. So, we’re joining forces, and we’re probably in the next 2 to 3 weeks going to be pushing out a pretty major update to our 1000x terminal. Obviously, as always, the 1000x coin will take half of—at least half of—the revenues, if not more, from this terminal. I think we’re going to be able to build something pretty incredible. So, I’m going to put two things out to the community. One, pay attention to the 1000x coin and the 1000x terminal over the next few weeks, when we end up pushing out the update in the next 2–3 weeks. I would love it if you guys ended up using it, signed up for an account, and tried it. Right now, it’s broken, so don’t worry about getting on there and trying it. But I did want to give you guys, the real ones, a heads-up.

Because it’s possible that if the terminal is really good and a ton of people sign up, a lot more people are going to find out about the 1000x coin. And I wanted to let you guys know about it now, before that happens, basically.

Yeah. I wouldn’t interpret that as a shill for the coin. Our half of whatever revenues come from this terminal is going into the coin for sure, because that’s what we promised. Promises made, promises kept here on the 1000x.

Promises made, promises kept. I would say what’s exciting about the terminal is that when you bootstrap a project, even when you get kicked in the nuts, like what just happened to us, there’s nobody shutting us down or bankrupting us or calling back debt. We’re just going to keep going. We’re going to will this thing into existence.

I mean, between the two of us, we’ve sunk multiple hundreds of thousands of dollars. We’ve lost a lot of money on this so far, but we’re—

Ain’t no thing, Avi. We’re just going to keep going until we plug it. We are absolutely plugging away.

So, do not worry, do not fear. We are not abandoning this project. We will never abandon you.

So, just know that we’re working our asses off for you. Obviously, Avi’s got a fire in his belly now. I love it. So do I.

We’re back. We’re back to roll.

Love you, bro. This was great. Thanks for talking to me every week. I learned so much.

This was awesome, Jonah. We’ll catch up soon. See you soon. Later.