I Hold Zero Cash; They Will Force Banks to Fail Warns Bitcoin King Jack Mallers
“Dedollarization started in ’08-’09 because the world realized they don’t care,” says Jack Mallers, CEO of Zap, a Bitcoin investment and payments company operating over the Lightning Network. In this insightful interview with Daniela Cambone, Mallers shares why he stopped using the U.S. dollar in his daily transactions and switched to Bitcoin in January. “They’re lending me a currency that’s constantly being debased. So I get to spend that currency without actually having to own it,” says Mallers. He views money as a representation of our time and energy, which can be saved or exchanged. Mallers argues that the global debt to GDP ratio indicates governments have borrowed extensively from our future without growth to repay it, leaving a loss that must be realized somewhere. Tune in to understand Mallers’ perspective on the financial future and why Bitcoin is central to his strategy.
CHAPTERS:
00:00 Gold and bitcoin
4:41 Jack’s thoughts on the Fed
7:06 Banks failure
8:36 Weaker dollar and debt
11:18 Money printing
13:40 Bitcoin price
16:38 Jack’s view on the U.S.
18:10 Jack has zero cash
23:22 Purchasing power diminishing
24:58 Jack’s life before bitcoin
27:00 Bitcoin ETF
29:20 Bitcoin 2.0
30:49 Why not gold for Jack?
36:01 Central banks buying gold
41:18 Bitcoin volatility
TRANSCRIPT FROM VIDEO:
00:06
Hi, this is Daniela Cambone. Welcome back to the Daniela Cambone show. Thrilled to have my next guest on because it’s been so long in the making. He is Jack Mallers. Sure you’re familiar. He’s a household name, especially in the cryptocurrency world and Bitcoin planet. He’s a Forbes under 30 recipient. He’s the founder and CEO of Strike, basically a system that lets you use Bitcoin to make daily payments on the Lightning Network. Something that Michael Saylor has said is the absolute-
00:36
future. So please welcome to the show Jack Maulers. Jack, so good to see you. I’m thrilled to be here. I’m pumped. And that was a hell of an introduction. I appreciate it. Look at this digital hug. Is that what you were offering me right there? There you go. That was a digital hug. I wanted to wear a hoodie today and now I see you’re not even wearing a hoodie. So- Oh, summertime shy. Summertime. I only get 90 days out of the year I get to sit in the sun. So my skin’s got to take advantage.
01:04
So let’s just break the ice here because I know I get this push back. They’re like, wait, but you’re the queen of the precious metals world. And we have you one of the Kings, I could say of the, of the crypto of the Bitcoin world. Um, so whenever these two worlds collide, I feel like I need to explain people cause they’re like, wait, but he’s in Bitcoin, but I got to tell you this, Jack, I was just at the Bitcoin conference.
01:34
was held in Montreal. And I think that, you know, there’s been so many gold versus Bitcoin debates. But I think it’s a beautiful thing when we remember that these two assets are really working towards a common goal. And so obviously I want to explore Bitcoin, want to explore gold with you today, want to talk to Fed monetary policy, which I believe is the common denominator, but just your thoughts. Do you think that gold and Bitcoin are just…
02:03
pitted too much against each other. I mean, do you see what I’m saying? That they’re working for the same cause. Sure. Yeah, I think we share a similar thesis and outlook on the world, which ultimately is shared human values, which is ultimately probably why we have great energy on the introduction to this show and we’re gonna be friends, right? I mean, a shared outlook on the world and shared values is what build relationships, which is the only thing that you can really die with. So I agree on that.
02:33
I do also though think that money tends to be one. And so I don’t totally envision a world where we have many monies, especially if they aren’t imposed and enforced by government and violence. And so that’s where we can probably have debate and have some fun and where I see the difference between gold and Bitcoin. But on net, we probably agree more with each other than any other sector, chapter, division of…
03:01
the universe and society at large. So for that, I have a lot of respect for you. And as I said, I’m a huge fan of the show. I appreciate that. And I’m always willing to hear, you know, to learn more, obviously about your wheelhouse and your expertise, which is Bitcoin, but let’s start with some common ground and talk, you know, for my audience that’s new to you and get your thoughts on what the Fed is doing with interest rates, how they…
03:30
completely destroyed the financial system, I think you’ve said in the past. Your thoughts on what, I mean, I’m assuming you think the Fed should not exist. Totally, yeah. I also, I think right now we’re in this really weird environment where we’ve had rates that were raised faster than they’ve ever been raised before, and they’ve persisted, and now we have this Fed that’s trying to…
03:55
scare markets and claim higher for longer, where in reality, I don’t think it actually matters. It’s clearly inflationary. Whether you’re looking at the stock market, gold, the real estate index, Bitcoin, everything is double digit, year over year returns. And so it’s clearly stimulative still. It’s clearly inflationary still. I think people can get confused by the price of money, which is interest rates. But what about the supply of money?
04:23
They’re still stimulating. They’re still printing dollars. And so I actually don’t think it matters what the Fed does. It’s all stimulative. And the reality is my favorite metric is global debt to GDP, because it really, to me, it just tells the story very cleanly, is that I view money as our time and energy in an abstracted form, our time and energy in a market good that we can either save or exchange.
04:53
Governments around the world have about borrowed a tremendous amount of our time and energy from our future with no growth to pay it back That loss has to be realized somewhere. Okay, so Where’s that loss can be realized? They have two options either the people that lent them the time and energy or the money Aren’t gonna get it back and those are who the bondholders Those are all of the banks all of the wealth in the world or they’re going to debase the currency
05:21
of the general populace and take time and energy from them. And that’s what we call inflation. So to me, it doesn’t really matter what the Fed does, hire for longer, we’re gonna cut. It’s all load of nonsense. It’s all very distracting. It’s that there’s a loss that has to be realized somewhere. And it’s either going to be all the banks have to collapse and the bond market and the sovereign debt market is gonna go to zero or.
05:44
they’re going to debase the currency and inflate their way out, which is just ways of abstracting time and energy away from the populace to make themselves whole on what has been an egregious mistake in government and in fiat currency. Which of the two do you think is more of the likely scenario? You tell me, I mean, come on, if they wanted to listen, if I became the dictator of America, where I can make any decision I wanted to do, what I would do is have the banks fail.
06:13
I mean, we’re running 2008 back. I mean, if they wanted to let the banks fail, they could have. I think de-dollarization started in 08, 09 because the world realized they don’t care about the value of this world reserve currency. They don’t care about protecting the shareholders of this dollar network. And they bailed those guys out. And that’s the only way. And the reality is there’s no easy way out. The other way…
06:41
is you need to debase the time and energy of everyone that commutes to work every single day. So think about it. I mean, why are people getting married later in life? Why are people having less kids? Why are people having less housing? Because it’s more time and energy that goes into a quality of life that we expect. Because they’re debasing our money. They’re debasing the time and energy that we’re contributing into the universe to make themselves whole on the whole in the balance sheet, right? On the global debt to GDP ratio. So I think they’re going to debase the currency, which by the way…
07:11
where we agree Bitcoin, gold, these are both assets that are outside the purview of their reach, right? They cannot debase these. And so it is a way to protect your time and energy in my opinion and why these assets probably perform very well. When you say they, you’re speaking of central bankers, correct? Yeah, I mean, the reality is Janet Yellen is Jerome Powell’s boss. I mean, that’s the reality. Maybe not literally yet.
07:41
But practically speaking, I mean, Jerome’s job is to put in policies and pathways in order to stabilize the bond market, right? That’s the whole overall position of the Fed. The Fed doesn’t really have much of a choice and much authority anymore. So I guess I’m talking about central banks, but in practice, central banks and government have a lot more overlap than they were intended to be when they were founded. Well, okay. So let’s take it one step further.
08:09
Because I can understand the dialogue of if there is truly a disconnect between the central bank and the government, the central bankers wanting to debase the currency. But when we’re talking about America as a whole, the superpower of the world, why would they want to let go of that status? I don’t think they want to let it go, but Janet Yellen benefits tremendously from a weaker dollar. Right? I mean, in the sense that, I mean, what she…
08:38
How is she going to pay all this debt back? So I think- But maybe they’re going to say, we don’t care to care. We just won’t pay the debt back. Let it roll. Well then who’s realizing the loss? There’s a real loss that has to be realized by someone. There is no easy way out. And that’s why I like calling money time and energy abstracted because money isn’t just a piece of paper that people can print.
09:05
I go to work every single day and I exchange that time and energy for what we call money. And so who’s realizing the loss is the real question. And if it’s just going to let it roll, then maybe those financing all these loans over the years, which is our banks, all the higher upper echelon wealth in the world, they’re not going to get paid back. So for example, the bond market is getting absolutely obliterated right now. Every bond holder is realizing, holy shit, I got a terrible deal from the US government.
09:35
This is a disaster. This is a mess. Why are we seeing a Bitcoin ETF? Because people want other avenues to see real returns with their capital. And so if we keep going like we’re going, then maybe it’s the bondholders that are the ones that are having to realize the loss. But the game is who’s realizing the loss. And that’s why we explore this idea of what is money and where should we put our money, which is where should we store our time and energy, right? That’s how I like to think about it. But
10:01
The idea that there is a loss that isn’t going to be realized is nonsensical. And that’s political speak. That’s what they want you to think. Well, I’m sure you saw that clip that went viral of, you know, people thought it was almost fake for how insanely silly it was of Jared Bernstein, chair of the council of economic advisors, which is the main agency advising Biden on economic policy. He was saying, well, the U S can’t go bankrupt.
10:30
because we’ll just keep printing money, which begs the question, well, why does the government even borrow in a currency we print ourselves? Why does the government borrow? And he could not answer the question. Like you said, they print the dollar. So why does the government even borrow? Well, again, some of this stuff gets…
10:59
some of the language that the MN, some of the language and concepts. I think this is a perfect example of why money that we use within society, so again, money solved this idea of barter, so we can hyperfixate and focus on our jobs and we don’t have to exchange them for someone else’s job. We can exchange them for money and then use them in an economy. That’s what allowed us to have billions of people in the economy, digitize the economy, have an economy on the internet.
11:28
And what we exchange our time and energy for cannot be centrally controlled by a group, especially government and politicians, because it will just be abused. And so that’s what I think we’ve seen is just compounded abuse over decades and decades and decades to people that supposedly make decisions. They don’t even know how it works. So to me, it was just a clear as day example. And I mean, even right in there, right. I think he’s right, by the way, the U S government can’t default.
11:56
I think that’s true and that’s the position they’ve always taken. So they will print, which is another way of saying they will inflate, they will debase. So they will take the time and energy of the general populace that has to go to work. Everyone that has to go to work every day will get less housing, less groceries, less gas, less cars, less family, less life expectancy in order to finance what they’re doing. And the only other way is for them to let the bond market collapse and for us to reset the whole thing. So he’s right.
12:26
Whether he knows it or not. He’s unfortunately looks clueless and uneducated though, but I don’t know if either of us are surprised by that No comment there but Look, I’m sure people have seen other interviews where you’ve spoken about Bitcoin Going to a million and not to you know exhaust this that nauseam But of course, you know when we hear these type of targets we want to understand and for maybe the folks watching who are new to you want to understand like
12:55
What is this based on? If it’s based on banks failing and a complete reset, that would be a deflationary environment. So I’m trying to understand how do we get to a million dollar target from your perspective? Well, I just don’t think people have a big enough imagination for this upcoming cycle and what’s going on. And I think we’re entering the last chapter of this macro economic
13:24
system of sorts. Really this is post-World War II and you have this American hegemony that we’ve, I’m American, that we have been trying to protect and persist for a long time. And I think we’re seeing potentially the final ends of that. I mean, let’s look at now there’s a dollar yen, there’s a swap line with Japan that we just opened, right? I mean,
13:51
We’ve seen currency crisis in Nigeria and in Turkey. Now we’re seeing one in Japan. Soon China’s gonna have to devalue. And so my simple math and logic is again, like there’s a loss that has to be realized. Do I think that the United States of America is going to default and have JP Morgan and all of their financial institutions and banking underbelly collapse?
14:15
We’re seeing what that looks like in Argentina, by the way. It’s not easy. I don’t think any politician is, I don’t think Trump or Biden or RFK is going to get up and say, I’m going to take away your healthcare. I’m going to take, I’m going to inflate everything around you. I’m going to crash everything you know. All your bank deposits are gone. We’re going to go through the great depression because it’s in the best interest of America. That’s not what politicians do, right? I think politicians are going to say, here’s a bunch of free shit and this is why you should elect me. And they’re going to have to.
14:45
fill the hole of this deficit. And that I think it’s not impossible to think. I’m quoted saying 250,000 to a million. That’s my range. And the range is wide, but you’re asking me to price something in a piece of paper that politicians, as you pointed out, that don’t even know how the system works are actively debasing. So, I think it trivially gets to 250,000. I think a million is possible within the next 18 months for that reason. I mean,
15:14
Even what’s happening right now in Japan is terrifying. They’re literally testing a swap line to protect the Japanese currency. The Japanese currency is getting so weak, China’s going to have to devalue soon, probably. So I think a million is reasonable, given the amount of debasing that they’re going to have to do to hold the system up and bail out the bond market.
15:40
You said you’re obviously American, you live in the US, but I know that you were a significant voice in helping get Bitcoin recognized as legal tender in El Salvador. Have you considered moving outside of the US? No. My position as an American when I was… So I’m 30 years old now. When I was born and raised here, America…
16:08
was taught to me as liberty, freedom, democracy, innovation, equality, and I believe those things. And I think leaving America entirely is giving up on America, and I think America is one of the most successful startups of all time, so to speak, and it represents human ideals that I still believe in. And so I plan to fight for those ideals. And so I still think that there is an America that believes in what it’s intended to be.
16:37
I think, unfortunately, I do think that post-World War II has to unwind. And I personally, as an American, I find Bitcoin to actually be far more American than the dollar in many ways. And so I will continue to innovate and build towards an American future that I believe in until I’m either kicked out or…
16:58
Or I believe that it is unfeasible and that there isn’t enough of America that shares the same ideals as I do. But I do believe that this country is united behind those ideals. And we’re generally frustrated about where we’ve ended up, but I, I’m not, I’m not going to give up. Is it true? You have zero cash. I read that somewhere in your bank account. Yeah, it’s true. So you, you’re, you are a hundred percent Bitcoin. Yep. Yeah. I actually, uh,
17:26
So the way that works is I, so I own $0 and I spend on credit cards, which to me is the best financial product that a bank’s ever given me because they’re lending me dollars for no collateral. So they’re lending me a currency that’s constantly being debased. So I get to spend that currency without actually having to own it. And then I hoard Bitcoin, which is the hardest asset of mankind, the best performing asset ever since it was invented over the last 15 years.
17:55
So I’m just running a short dollar trade, a speculative dollar attack in my day-to-day life. It’s very logical as I own the thing that goes up the most and I borrow and spend without needing to own the thing that goes down the most. Yeah, no, I’m fascinated because I’m sure a lot of people watching are thinking, okay, Jack, you live, breathe, you are like a walking Bitcoin, but how realistic is it for like an everyday Joe?
18:24
or Joette to be living that lifestyle of zero cash, no money in the bank, 100% Bitcoin. Because you know how to work the system. I mean, how does it work with taxes? I’m asking like realistically, how difficult- So the products that I use to do this, we’re actually making public at Strike. So I don’t really like pitching Bitcoin with my company because it feels salesman-y. So you got to just take it. This is just how I do it. You guys can do it however you want.
18:54
But we at Strike offer a real time, we integrated RTP FedNow. So we have a real time withdrawal feature and we have a direct deposit where you can get your paychecks in Bitcoin. So all of my paychecks land in my Strike account as Bitcoin. And then every single month, whenever I need to pay down expenses, then I swap it to dollars. I real time pay those bills. And so I’m effectively just using Strike as a Bitcoin checking account.
19:20
And I think it’s more than reasonable. I mean, first of all, the best way to achieve this is to live within your means. So if you’re spending less than your paycheck, then it’s never really, really a huge issue. The, the risk is that Bitcoin draws down so much that it depletes your total value and in that you have expenses that exceed that number, right? If Bitcoin goes down 80% and now all of a sudden you don’t have enough capital in dollar terms to pay off your expenses. So that’s the risk that you need to measure as an adult.
19:48
But I think it’s more than reasonable to, as long as you live within your means and you have some cushion that is going to cover expenses in some dramatic event, then it’s the most logical thing to do is to hoard the money that goes up the most against and borrow the money that goes down the most. And I’ve done really well. I think when I made this decision was on the first of this year, I think Bitcoin is at like 30 K or something. And so everything around me has gotten at least half off. Oh, it’s a great way to live.
20:18
Wow. So, okay. You made that decision, zero cash, as just January this year. Yeah. I mean, I was generally long. You’ll never meet a human more long than I am. I mean, it’s my business, my assets, everything about me is long Bitcoin. If Bitcoin goes to zero, I don’t know what I’m going to do with myself. So that’s how long I am. But I made the conscious decision, not only for logical financial reasons, as I just said, but more as a matter of statement too.
20:47
to just, I don’t even want a dollar right now because I don’t agree with the way they’re being managed. I don’t agree with the future outlook of them and what they stand for. So that was Jan one. And yeah, like I said, I mean, if Bitcoin is averaging, let’s say 50 to 100% year over year over its course against the dollar, then you’re talking about living a life where every single year everything around you gets half off. It’s a fun way.
21:12
live. I was having audio issues. Were you referring to Bitcoin ETFs that you’re, were you talking Bitcoin ETFs there, Jack? No, no, no, no. I’m just saying if Bitcoin, the asset averages 50 to 100% year over year, which that number fluctuates because at its peak bull annualized returns average out way north of a hundred percent in the peak of its bear market after Sam Aikman freed to something criminal.
21:41
then Bitcoin’s average returns are coming down. But generally speaking, it’s the best performing thing. And if you live your life on Bitcoin, everything around you is around half off year over year. Your dream house gets half off, your groceries are half off, your gas is half off. And so it’s a phenomenal way to store your time and energy. Like I said, I mean, I work hard for the world and in return, I store that in Bitcoin and it rewards me for that. And so I encourage everyone
22:10
download strike and do what I do, which is get your paychecks and Bitcoin and then use the instant payments to pay your bills. Does that, you know, whether you’re, you know, Bitcoin gold, whatever side, um, do you, do you find it’s fascinating that how many people don’t realize, uh, how their purchasing power is diminishing year over year? I mean, they’re just clouded by this news. Do you think it’s purposely kept from?
22:40
the general population? I mean, Oh, well, I mean, purposely kept sounds maybe too conspiratorial, but I do think that central banks and governments benefit from people not knowing that information. And so it doesn’t surprise me that it isn’t on billboards in New York City and isn’t taught in university. So I do, but you know, I don’t think that there’s a blueprint.
23:08
under Biden’s desk that goes through gatekeeping this info. But yeah, I think, so listen, first of all, inflation isn’t a broad metric. Inflation needs to be measured on a per instrument or per asset or per service or good basis. And so if housing in America is getting 20% more expensive every single year, unless you’re getting a 20% raise every single year at your job, you’re not working towards owning a home.
23:36
Right. And that’s so to me, that’s just like the very base level concept. So you need to store your wealth, your time and energy in something that outpaces that 20% and that is just a hard asset. That’s a better money. And if that is gold or Bitcoin, but that’s the idea. I think it’s very simple once people understand it, but yeah, I am generally surprised. Jack, I know we always speak of your life, you know, with Jack and in the Bitcoin world, but I want to know about.
24:05
who you were before Bitcoin entered your life. What was life like for you before Bitcoin? Well, I was 18. I was- You were 18? Yeah, I was going on my first dates. I was playing a lot of chess. No, my Bitcoin story is my dad. My dad got me into Bitcoin. I have a family that has some finance history here in Chicago.
24:34
And I would say, unfortunately, my dad isn’t a gold bug, but similar outlook where he’s lived his life short dollar. I mean, the whole thing is once you understand how this all works, they have to debase their way out. And so real estate, Bitcoin, that was how I was raised is short dollar, generally speaking. But I don’t know, I played basketball, football, baseball. I’m a former chess champion here in Illinois. And
25:01
When I was 18 years old, I was getting the courage to probably ask a girl out on my first date if I had to guess. I can’t really remember exactly where I was, but something like that. Fair enough. Yeah. I mean, it’s obviously completely changed your universe. Of course. I mean, I think of Bitcoin more than a better money. Bitcoin, for me, has been life purpose. If you think about the story of humanity, I think it’s the story of engineering a better world.
25:31
And to me, Bitcoin represents that in its full form. And it’s allowed me to participate in conversations and in education that I would never be privy to and relationships that I would never be privy to and ultimately be part of something bigger than myself, which I think we all want, whether that’s in family, whether that’s in work. And I think in life purpose is being part of the human story that is larger than us. And Bitcoin for me is the best expression of humanity in that way.
25:59
I’m curious to get your thoughts on ETFs, the Bitcoin ETFs, which many would argue is a double-edged sword. It financialized Bitcoin, just like the ETFs financialized gold. Does that make it part of the system and against the ethos and what Bitcoin was created to be? No. So I think gold, unfortunately, and we can get into the Bitcoin gold debate, but I think gold concentrates.
26:28
which is just an unfortunate property of the metal itself. Bitcoin doesn’t. In fact, there’s an all-time low of physical Bitcoin on exchanges today, which implies that they’re being custody by the individuals. The fact that I can put a physical Bitcoin in my brain is a technological innovation. I can’t put a gold bar in my brain when I put it through my ear or through my mouth, right? And so I don’t think that the risk of Bitcoin concentrating is near what it was
26:57
with gold. I also think because Satoshi released it on a mailing list and walked away is the fact that it’s so well distributed already through the people. If Satoshi took it to Goldman Sachs and listed it on a public exchange, I think that it would be concentrated, but Satoshi did not do that. And so I think it’s nearly impossible for someone like BlackRock or someone like Michael Saylor to achieve a position that’s big enough to concentrate Bitcoin.
27:23
So I don’t see it as a risk in that standpoint. I do see it as a risk in that it’s still a financial instrument that’s within the existing old school financial system. Right? You don’t actually own Bitcoin. You own Larry Fink’s security that represents Bitcoin. And so I think those are two entirely different assets and you’re sacrificing a lot of the benefit of owning Bitcoin for the convenience of the ETF.
27:50
So that, I think there’s risk for those that are opting to own an ETF as opposed to the physical Bitcoin, but maybe they’ve evaluated those trade-offs and those trade-offs are beneficial for them. But on net, I think it’s a phenomenal thing for the industry because Bitcoin is this permissionless system. Everyone has a right to do whatever they want with it. The rules are set in stone. No one can change them and they are what they are. And so people can do whatever they want. And I think it’s great that banks and Wall Street are on the same team as me. It’s very telling as to where the…
28:19
global macro environment is right now? Educate us a little bit more on that because, you know, obviously I’ve done enough Bitcoin gold debates where the response is always like, well, Bitcoin can’t be rewritten. Someone can’t rewrite the software. And I know that Bitcoin cash is brought up as an example of exactly it failed. It couldn’t do it. I get it. But why can’t a Bitcoin to
28:46
point O be created just because Bitcoin Cash failed. Why can’t it? I mean, it can. You can create your own money and you can test it in the market and see if it gets adopted. I would wish you the best of luck. I would bet my life you’d fail for a variety of reasons that aren’t personal. But I think something like the dollar has a lot of adoption because of the US military.
29:14
That’s why, because it’s enforced. If I don’t use the dollar, they will put me in prison. That’s why I use it. So there is a level of violence that enforces money. And if you don’t have violence, then it needs to have sound money properties that advantage not only the people holding it, but advantage them holding it against every other money. And so you can create as many monies as you want. I would wish you the best of luck. And we’ve seen that. I mean, there’s been 10,000 million
29:43
alternative cryptocurrencies and none have come close to competing with Bitcoin. And so, you know, I guess I’m going to get to the question. I mean, you know, you kind of paved the way you said your dad showed you the way he wasn’t a gold bug. You got into Bitcoin. But why isn’t gold an answer for you or at least part of your portfolio? I’m so convicted in Bitcoin. I think money concentrates is one. My portfolio may not be everyone’s portfolio. Let me answer it this way.
30:13
Again, I love this idea of money is our time and energy in an abstracted form. Whether you mow lawns or you’re an accountant or you’re the CEO of Strike, you spend your time and energy and in return for that, you get money. So what does that money need to do? It needs to do two things. You need to be able to save it through time and you need to be able to exchange it and move it and what we call traditionally through space. So how easy is it for me to exchange and move my money?
30:42
and how easy is it for me to save and persist my money through time. So for example, if I were to work as the CEO of Strike and get compensated in barrels of wheat, my money would be expired next week so I wouldn’t be able to save it. And if I wanted to send that wheat to Europe, it’d be very difficult for me to do that. So it’s not good at exchanging and moving through space, and it’s not good at saving and moving through time. Okay, let’s look at gold. Gold, under the best circumstances,
31:11
is 2% inflation. That means gold has a half-life of around 30 years and through the life expectancy of an American like me, around 70 years, over half of my wealth is gone with 2% inflation. So that’s it saving through time. Now moving it through space, how easy is it for me to say, oh I would like some of my gold to be in France tomorrow?
31:37
not easy at all. How easy is it for me to even store a billion dollars or a million dollars worth of gold? Not easy at all. So I think for that reason, gold is not an amazing money. I think it’s the best commodity, which at the time, sometime in human history was probably a really good money, but not today. Because if you look at Bitcoin, Bitcoin has an inflation rate of zero. So how much better is an inflation rate of zero than 2%? A million times better. Bitcoin’s half-life
32:07
And worst case scenario is like billions of years, but practically speaking, according to math, it’s, it’s infinity, right? My money is never being debased ever. And how easy is it for me to move some of my Bitcoin from Chicago to France by tomorrow? In fact, I can get it there in less than 10 seconds and at fraction of a cost. So it’s better to travel through space and time, which are the properties that, you know, I, I want my time and energy to have. And so.
32:35
I just never understood the gold pitch. It’s defective money according to the properties of what I want my money to do. The last point I will say is what a gold bug would traditionally tell me is, listen, it doesn’t have the history that gold has. It doesn’t have the brand and the reliability. Well, if you need something else to have the brand and the reliability of gold.
32:58
then you’re pricing yourself out of ever getting anything better or the new innovative technology technological thing. That’s like a general manager in the NBA saying, I’m not adding another player to my roster that doesn’t have the credibility of LeBron James. It was like, well, then you’re never going to draft anybody. You’re never going to get Steph Curry. You’re never going to get Kevin Durant. You’re just going to sit and wait for someone to exceed the credibility of LeBron James. And LeBron’s getting old and LeBron isn’t the best basketball player anymore.
33:27
And so I think like, if people are going to want to wait for Bitcoin, fine, then you’re not going to get part of the gains that I’m getting. And I can’t argue with that. That’s your decision. I think it’s a really stupid one, but what can I say? So I think for those reasons, Bitcoin’s obvious to me. And I’ve never heard anyone convince me otherwise. And I would argue, you know, I’m. The goat for me is Michael Jordan. I don’t care what anyone says. Sorry, Joe.
33:56
Me too, being from Chicago. But just logically speaking today, right? Can you imagine if someone said, hey, unless someone achieves the credibility of Michael Jordan or LeBron, we can’t entertain them? That’s what a gold bug sounds like to me. It was like, what do you want Bitcoin to do? It can’t create years of existence. That’s, you know, so it’s just gonna continue to outperform it for the reasons I explained. And you’re gonna have to watch me accrete more wealth than gold bugs every single year.
34:26
What do you okay so so you know just to defend gold here a little bit if you want to talk inflation hedges and and safe havens gold outpacing treasuries for the first time in 35 years seen as the safest bet and that aside. Explain to me where there would be a mind shift where central banks are not hoarding gold in times of geopolitical crisis.
34:54
and inflation, China buying at record amounts. I mean, what would it take for central banks to be like, yeah, you know what, let’s forget hoarding gold. No, so here, let me pitch the gold bull case. Cause again, I think as much as I wanna poke fun at you, I think we’re more on the same team than not. Gold is the only money or asset that all central banks around the world agree that has value.
35:23
And that within itself is valuable. And so I think that there’s a non-zero chance. In fact, every day it becomes more likely that central banks are going to debase their currency against the gold that they’re hoarding and acquiring. And that is very real. And for that reason, I think it’s logical to own some of the thing that central banks are likely going to agree has value and debase their currencies against. That I have no issue with. So maybe one day I take.
35:51
my portfolio and I turn 1% of it into gold. But even if I were to split my portfolio, but even well, I won’t do that. You heard it here at first folks. That would be the, that’s the gold bull case. The thing that I think is hilarious though is even if let’s say last year I were to take half my portfolio and say half gold, half Bitcoin,
36:16
My portfolio would then again be 90-10 Bitcoin because Bitcoin is just that performant against gold. So you can’t even have an even portfolio unless you’re constantly taking away from your Bitcoin and reinvesting it into gold because it’s that performant. So even if you have some gold exposure, I see it as minimal compared to Bitcoin, even if you start 50-50 because Bitcoin is just so much more performant. Again, for the reasons I said, the difference, I don’t think people understand the difference between 2% inflation and 0% is…
36:45
astronomically large. You’re talking about, oh, I can store my money for 30 to 50 years to I can store my money for billions of years. And I don’t, I don’t really know how we as humanity can say, we’re going to take all of our collective time and energy and store it into something where we don’t know how much of it there is. Like whenever I I’ll Google how much gold is there in the world? And it’ll be a rounding error. That’s like the size of Bitcoin’s market cap. So here’s the point that the Bitcoin cap loves to bring up.
37:14
of how Bitcoin is finite but gold is not. There’s only so much gold and I don’t want to hear, oh, we can mine it on Mars, Jack. Okay? Because you and I both know it’s not going to happen in our lifetime.
37:30
What do you think? The problem with the problem that we have, generally speaking, is in markets is more demand finds more supply. The reason I can’t store my value in an iPhone is because if all 8 billion people wanted 20 iPhones each, Apple will just manufacture them and produce them. So more demand always finds more supply. That’s always been true for gold as well. And so you can make the argument that that will happen after I die or that will happen
38:00
after aliens come down here, or you can just take the very simplistic, mathematically guaranteed approach that there’s never going to be any more Bitcoin. I don’t have to speculate on whether it involves aliens or my lifespan. I mean, I can take my time and energy in my life, turn it into Bitcoin and hand it to my kid with absolute certainty that it’s not going to be debased and devalued. And so why would I even entertain? It sounds like a gold bug that wants to argue me with that. I don’t get it.
38:30
For you, Bitcoin is generational wealth. Your conviction is you will hand down this wealth that will never die to your kids, your grandkids, your great grandkids. Well, for me, Bitcoin is the best money. Again, it’s the best thing that travels through time and through space. I use Bitcoin, as I said.
38:52
So I still, I mean, I exchange Bitcoin for real goods and services every single month. And it’s very good at that. I can take any fraction of my Bitcoins. It’s liquid 24-7, very liquid in every currency all over the world. So it’s phenomenal at that and it’s phenomenal at persisting its wealth across time. And so in what money is intended to be, which is not barter, which is scaling our economy, it’s the best hands down.
39:22
Like not even close and so that’s what I use it for but I do think that that’s a really cool idea You know, I think being able to spend a life Contributing to the world and storing that time and energy of contribution into Bitcoin and handing it down is the closest thing We’ll ever get to living forever, right? I like I think that’s really really cool Like how do you give your life’s work to your kids? You can give them the house that they grew up in right you can give them your stock portfolio
39:50
But I think giving them your life represented in Bitcoin is a really cool novel concept that is going to become increasingly popular. Absolutely. I think that that is a beautiful thing. I guess my last question you can bring it home for us with this, because I’m sure a lot of folks are watching this thinking, Oh, I want to live Jack lifestyle. Um, how do you, I mean, educate me a little bit on how you deal with obviously the swings in volatility.
40:18
that come with being 100% in Bitcoin? Well, volatility is life. Volatility is a good thing. So first of all, if you were to walk into a building and I were to tell you, you have to get to the top floor, but with no volatility, how are you gonna go up? You’re gonna be stuck in the lobby for the rest of your life.
40:44
And so the idea that we’ve all been convinced that volatility is bad is the same idea that no one’s educated on purchasing power. Volatility is human. Entropy is constant in our world. And so volatility is normal. Volatility is expected and volatility is progress. So I encourage and invite volatility as far as how do I financially deal with it. I think you have a low time preference and you live within your means. Like I said, if you.
41:13
don’t exceed if you don’t consume more from the world than you give to it, which is another way of living your life profitably, right? Like strike is a profitable business. We give more to the world than we consume from it. That’s how I think about it. And so as a human, give more to the world than you consume from it. That way you can accrue and save. And it’s very simple from there. I think that’s a really important point. Let’s just end it there because look, you’re young, you’ve obviously done extremely well.
41:43
You could live the Lambo lifestyle, but you’re turning your back on that. How do you stay that course? Cause I know a lot of folks or young people I speak to just want to get rich quick, want the money, but how do you stay focused and see beyond all the material, shiny, nice objects that you could have, Jack, you could have all of that. I think Bitcoin taught me that more than any one else or any other experience to be totally honest with you.
42:12
Because when you do understand the concept of time and energy and contributions to society, then a fancy car isn’t ever worth the Bitcoin that I’ve worked to acquire. And so I only trade and exchange my Bitcoin for experiences for people I love, to be honest. I mean, how beautiful is it? How beautiful of an idea, I guess, is it?
42:42
you know, we can make the world a better place for the people that we care about the most. And so Bitcoin taught me that it really lowered my time preference, uh, and taught me the value of things. I think it’s, it’s really impossible to value things if there’s an infinite amount of dollars. I like to draw this similarity to the promise of death. This is going to get potentially a little weird or dark, but you know, it’s the promise of We invite that. I invite that. It’s, it’s the promise of death that allows us to value our life.
43:10
If I was never going to die and I knew that, then I’d go to the gym in a thousand years. I’d think to get married in 10,000 years. I would never care to value today. That’s very similar to the dollar. If there’s infinite amounts of dollars and we’re going to roll this debt over forever, then how do I value my paycheck right now? I think what death means to life, Bitcoin means to money and to value.
43:37
Bitcoin gave me that finite promise that allows me to value the time and energy that I spent right now. And it’s not worth expending a tremendous amount of my time and energy on a yellow car that goes really fast. In the same way that knowing that I’m going to die, it’s not worth ever wasting a day, a week, a year.
43:59
That’s really well said, Jack. I mean, what does your family think of all your success? I mean, they must be just so proud of you. I’d hope that they are, but I think they also know the guy that, I mean, I’m wearing a white shirt and by the time I go to bed, it’s going to be riddled with stains. So.
44:24
That I don’t know. I mean, like I said, my parents got me involved in Bitcoin. We’ve always been the Bitcoin team. And so I’m proud of them as well. And I don’t think it really, I don’t think it really matters to be honest. I mean, we just, uh, every day we try and make the world a better place. And it’s a lot of fun. Bitcoin, Bitcoin makes life a lot more worth it in my opinion. Wow. Oh, I have tremendous respect for you, Jack. Um, I wish you continued success. Uh,
44:54
Thank you for your time today. Thank you for educating me and my audience. And I hope we meet face to face one day so we can continue these conversations. We will. This was a lot of fun and I really appreciate you as well. Growing up, I watched your show. So I thank you guys for the work you do. Now I feel really old, but thank you. No, seriously. Seriously, over the years, I’ve been a huge fan. So I really appreciate it. I’m honored to be on.
45:23
Finally. Awesome. Thank you, Jack. Jack Maulers, everyone. And that’s it for me. Thank you for watching. We’ll have more great content coming your way. So be sure to stay tuned to the Daniela Cambone show and sign up at www.danielacambone.com to stay on top of it all. See you soon.
SOURCES:
https://twitter.com/jackmallers
https://www.youtube.com/watch?v=Hlj-QQgbW90
https://x.com/jackmallers/status/1742313114362589634
https://www.youtube.com/watch?v=ZxaNA5rRY88
https://www.imf.org/external/datamapper/GG_DEBT_GDP@GDD/USA
