Welcome back to Speak Up with Anthony Scaramucci! In this captivating episode, join us as Anthony, CEO of SkyBridge Capital and Wealthion host, sits down with the insightful Anthony Pompliano, investor and the mind behind pompletter.com. It’s a no-holds-barred conversation diving into the crypto universe, discussing everything from Anthony’s first Bitcoin to the future of decentralized finance.
Anthony Scaramucci 0:01
Pomp… Have you read every one of those books behind? You see me I don’t have any books behind me. So it’s a sign of a vacuous mine. Every one of those books you’ve read every single one of them and I figured that you read all the same books, you just got them on Kindle. You’re smarter than me. You don’t have all the physical trash that I got behind my head. Make sure it looks fun. Look at this pump. This is I’m at the Bacharach Hotel. We’re doing the show live. So I’m in the city today. And they gave me a pen from the Thomas Jefferson arrow. Of course, one US dollar and the Thomas Jefferson era has maybe $2,000 of 2023 purchasing power. So I think that’s a big topic that we should talk about on today’s show. Yeah, George Washington like you’re just gonna stroke out a couple of important documents there. All right, this to speak up was Anthony Scaramucci.
So pop the world is passing me by at least I’m mature enough to understand that I’m aging out as an elder statesman in the world of investments all wealthy on clients demanding a crypto tutorial from none other than Anthony pomp Leon O and so before I introduce my good friend Anthony pomp Leon a pop when did you get into crypto Where did you buy your first Bitcoin?
Anthony Pompliano 1:29
I don’t remember the first Bitcoin. I started mining Aetherium in 2016. And the first price I remember is like seven, eight bucks. And then the first like, oh, I should pay attention to this was the 2017 bull market. But as many people I thought I missed it. I was like, Oh, like this thing’s already a thing. You know, I completely missed all of the upside how stupid I was, was, was I? But obviously that turned out not to be true.
Anthony Scaramucci 1:58
So Anthony Pompliano, Italian American, grew up in North Carolina, went to a school that is very famous, because another very famous and very wealthy Italian American went there. KENNETH Langone Bucknell University, a small school out in Pennsylvania Lewisburg, Pennsylvania. What did you do after Buck now?
Anthony Pompliano 2:22
I was in the military, walla walla in school, I did a deployment to Iraq. During my junior year of college, I got pulled out of school to do it. And then when I came back, I started my first business. And really, it was me running from getting a job. I was like, Well, it sounds way better. And so I ended up building two software businesses that were, you know, small, profitable things, ended up selling each one of them, made a little bit of money, but not enough to retire. And then decided, hey, I either need to go to business school, or I need to go somewhere where I can learn how to scale these things. How do I build them bigger? And so I took a job as a product manager at Facebook, and went out there and learned quite a bit and, you know, kind of really create an inflection point for my career.
Anthony Scaramucci 3:05
And the crypto experience 2016 Why did you start mining and theory and what what got on you and what did you see? Somebody like me an elder statesman and institutional is did not see it. The Winklevosses came to me at a salt conference in 2014 tried to explain to me Bitcoin, I looked at them like they were crazy. And so I missed it. You saw it? What did you say? What missed
Anthony Pompliano 3:31
it too, right? In the sense of I think it was 2013. I was first time I heard about it. I’ve got like DMS we’re all, you know, messaging with people about it and completely dismissive. And then in 2014, or into 2014, maybe beginning of 2015. When I was at Facebook, we had David Marcus from PayPal is a former president of PayPal. And he and a couple of folks who came with him had been talking about Bitcoin and potentially, you know, could they integrate it into products? Or what would happen? I turned to one of the engineers who sat near me and I said, you know, what do you think about this? And you just said, it’s stupid. I never Googled it. And anything I just okay, smart person told me it’s stupid. I moved on 2016 What really got me there was not the world called Bitcoin or crypto pitch. It wasn’t you know, hey, we’re creating a new financial system or any of that stuff. It was simply a young kid who’s in college said, you can mind you this device equipment, you plug it in, and you can get money for it. And my family had been in the data center business for a long time. And he basically pitched it to me, it’s just like a new type of data center, that’s lower cost to actually operate. And so, you know, I’ve done what I’ve done many times, usually doesn’t work out the time it did. I took some money, I bought the machines, I got them plugged in somewhere. And I just waited. And I was mining about five Aetherium a day. But $8 not really going to write home about a couple, you know, 4050 bucks. But then all of a sudden at the beginning of 2017 the price of ether went from eight $10 To 30 to 100 in a couple you know, three or four months, and I was like oh I should pay attention to something’s happening here that I don’t understand. And so I pretty much took, you know, a year and a half or so to do a pretty deep dive, and it was getting high conviction and then decided to focus a lot of my time and energy on it.
Anthony Scaramucci 5:13
Okay, so theory is the first spot, you go to your mining Aetherium you’re mining it in the 2030 $40 valuation, where is it theory of now Anthony.
Anthony Pompliano 5:25
It shouldn’t be like 20 220 $400. I wish that I could say that I was smart enough to hold. I sold it all around 300 bucks, and thought I was a genius because I was up, you know, 30x and instead had too much pride to buy back in as it ran all the way up to $1,400.20 17. But what happened during that time period was, although I was sitting on the sidelines, in terms of not buying back into the Ethereum market, I was I was learning I really sat down and I was studying is if you know, I was in school, and what I came to the conclusion of was, maybe Aetherium was going to work, maybe it wasn’t, but Bitcoin specifically was, you know, a much higher conviction thing for me. And so in the summer of 2018, I went out and raised a fund, and I waited. And so Bitcoin went from $20,000 at the end of 2017, crash all the way down to $3,200. And I made a pretty sizable personal bet, sub $3,500 on Bitcoin, and then from there, decided to start allocating the fund and kind of really said, okay, you know, I think that’s the bottom of the market and let’s go
Anthony Scaramucci 6:34
so one of the things about wealthy on and speak up with the Moocher, Anthony Scaramucci, is that we are very customer oriented, very viewer oriented, we got a tremendous amount of feedback over the last couple of weeks about getting somebody on that could take the group through a deep dive. So it’s not CNBC, where you get five to seven minutes, when those shows are great, and so forth. But this is a show where we would like you to explain to a viewer, what is crypto? What is something like Bitcoin? How is it distinguished from something like a Aetherium or Solana? And take your time yet take us through what you know, and what you would want somebody that doesn’t know anything about the space to know. Yeah,
Anthony Pompliano 7:22
I mean, let’s start with Bitcoin. First, I think it’s kind of the easiest one to wrap your head around. If you think of what a currency is, right, a currency is issued by a government or central bank. It basically is an asset that people either believe will hold its value and store value, or people can use to exchange for goods and services. The dollar specifically used to be backed by gold since 1971. We’ve unpacked it, and now it is really just the full faith of the federal government. And the reason why the dollar has value is because you and I believe it has value. When people think of Bitcoin, especially people who, you know, I’ve been in finance, maybe even before the unpacking from gold, but definitely before bitcoins existence, they said, Why would I trust this new thing? But what I think is happening with Bitcoin, specifically is that there’s an entire new generation of people, right? If you are 16 years old, you’ve never lived a day of your life without Bitcoin being in existence. And so for this new generation, they believe right, they see that there’s value in it. Now what exactly is it is important, you can think of a automated central bank is the way that I describe it. And so what that means is, there is a organization, but rather than a be made of people who go into a conference room and make decisions based on the monetary policy, the monetary policy was determined by one person, they wrote it into software, and that software is not going to change. And so what’s happening here is the monetary policy in the United States $1 unlimited supply, and we constantly change, are we printing more? Are we taking more out of circulation? Are we changing interest rates, or all this kind of manipulation of the currency? With Bitcoin, there’s only ever going to be 21 million, and right now 900 Bitcoin a day come into circulation. And so when you see that what happens is that one of the reasons why people are putting more value or ascribing trust to this is because there’s certainty. If I asked you, you know, what our interest rates going to be tomorrow, you don’t know if I asked you how much money was printed today, you don’t know. But if I say to you how much Bitcoin was printed, you know, exactly, because you can go and you can verify it online. And so when you think of a digital currency, a lot of people say, Well, I don’t like digital currencies. Well, the dollar is a digital currency today, right? I don’t carry around tons of cash outside of my Italian singles. But other than that, what I’ve got to do is I gotta go, and I’ve got to use the internet to move money, right? When I go and I spend a credit card or I go when I tap Apple Pay or whatever, I’m using digital currency. What we’re really talking about is not so much a form factor change as much as we’re talking about a monetary policy change. And so when people look at Bitcoin, another component of it is just, you already have a world full of multiple currencies right here in the United States. We are Dollar maximalist carry dollars we use dollars we get paid in dollars to pay taxes in dollars we save in dollars. But if I go to Mexico, I walk across an imaginary line right now all of a sudden their peso maximalist, somebody there does the exact same thing. And so one way to think about Bitcoin is the people on the internet. They’re just Bitcoin maximalist, right? They use Bitcoin to get paid to pay taxes to do all this stuff. And so I think that’s really a couple of different ways to kind of wrap your head around it. It’s a currency just like anything else. It’s got a little bit different monetary policy, and a younger generation is growing up seeing this as a viable alternative. And the more people that believe in a currency, the more value that it attracts, and it seems like it’s heading in the right direction.
Anthony Scaramucci 10:43
So pomp, you’re referencing Italian singles. Okay, so let’s talk about it. I came on your podcast, I brought them with me, Look, these are Italian singles, right? So in our neighborhood that we grew up in, right, we hand these things out to people, we get them excited. Right, exactly. Okay. But let’s just for our viewers, just for you, just for you. Yeah, and I appreciate it, Anthony. Now, this is made out of cotton. And it’s made out of linen. Go google it. Okay. It’s one part cotton, one part linen. Why do we trust this pump? And why should we trust Bitcoin? Yeah,
Anthony Pompliano 11:16
I mean, look, there’s a huge reason why we trust the dollar is because every single time we try to go spend it, somebody will give us a good or service for it. Right? If I go to the store, and I give them a $20 bill, they will give me whatever in the store is worth $20. And so we trust, because we’ve been trained over time that it works. And there’s nothing wrong with the dollar from that standpoint, that’s a great medium of exchange, right? There’s people all around the world that would love to have dollars, if possible. The reason why I think that there’s people who are saying wait a second, maybe I don’t want to have 100% of my wealth in dollars, is because historically, the dollar has been devalued. And so if we go and we look, I mean, just from 2020 to the end, or I’m sorry, to the end of 2020 to $1, lost about 17% of its purchasing power. So what it took to buy with $1 now can only buy at seven cents, you know, three years later. And so people say, okay, hold on a second here. If I’m a wealthy person in America, I’ve pretty much learned the trick to building wealth, get out of dollars, right? If I own stocks, the stocks go up about eight to 11% a year because the dollar is being devalued. Real estate goes up, right? real estates responsible for 90% of millionaires in America, supposedly, if that’s true, what are they doing, they’re getting out of dollars for holding an asset, that asset is priced in dollars, the dollar gets devalued need more of those dollars to buy the asset later. And so what ultimately really I think is kind of becoming more apparent to people is that the dollar is amazing as a medium of exchange. And something like Bitcoin, or other types of store value assets are great for saving. And so that’s really where I think you’re kind of seeing this bifurcation is people are going to say, Hey, I’m gonna use my dollars to spend, and then I’m going to use my bitcoin to save for the foreseeable future.
Anthony Scaramucci 13:00
Okay, I mean, it’s a it’s a very good summary. And so people are probably a little still confused pockets I was in the beginning. But basically, what you’re saying is we trust this, because we can give it to somebody else. And as a result of its we trust it, what it really is, is a database. Right? What’s unique about Bitcoin is that it’s a fully transparent, fully distributed database, which basically locks us into value exchange between each other. And so once we understand that money is a technology that we’re using, so that we don’t have to border, well, then how do you make a more perfect technology, which is precise and can’t get devalued by a government? Okay, and that’s basically what something like Bitcoin would represent. So let’s now go to something like a Solana or an Aetherium. What are those, Anthony? And how would you describe those to our listeners?
Anthony Pompliano 13:58
So if I look at the entire cryptocurrency market, I basically would draw if I draw a line, I will put Bitcoin on one side of the line, it is trying to be money. And then I would put all these other technologies, things like Solana, Aetherium, etc. And they’re trying to be technology platforms. So you can think of Aetherium as a decentralized version of let’s say, Apple’s iOS system, right? So if somebody wants to go build a mobile app, they go and they write software, they use iOS, which is the operating system to write that software. They didn’t list it on Apple’s mobile store, right, or their app store. And then users can go in, they can download it. But what you’re really doing when you build that mobile app is you’re building it on top of iOS, this operating system. What a theory essentially has done is they said, Well, wait a second, why does Apple get to make all the rules? Why does Apple get all the control? Why does Apple have kind of this monopoly on this technology? And so Aetherium basically created a operating system. They call it a decentralized computer, but basically an operating system where people can come and they can go ahead and you can actually build stuff on top of it. it. Now what you build is up to the individual developers, some people want to build dating app, some people want to build, you know, exchanges to trade on, some people want to build the next great video game, whatever they want to build, they can build. And so what’s unique about it is if you want exposure to Apple’s App Store, you gotta buy Apple stock. But that also means you got exposure to their VR bet to their phone, bet a bunch of things with Aetherium, which are able to do is you can actually buy ether, which is the cryptocurrency of Aetherium. And you get direct exposure to the rise or fall of popularity of the Aetherium operating system. And so really, I think what we’ve seen with Aetherium, and many others now, is there’s this change from centralization to decentralization. Rather than have a small group of people control things, we actually want the the majority of people to control them. And then also the ability for individuals to participate in the rise and fall in popularity and value of products, not companies. So being able to just invest in Amazon’s AWS system versus all of Amazon. And so by doing that, now, you actually are able to incentivize people who are playing in that ecosystem. So you can imagine if you hold ether or the Aetherium token, now all of a sudden, you’re really, really incentivized to see a theory and be successful, right. And so it creates these network effects and kind of unique aspects that really drive behavior in a way that maybe traditional centralized companies haven’t been able to accomplish.
Anthony Scaramucci 16:27
Okay, and this is why I wanted to bring it on. And because you describe it in a way where people can understand it. And so, so ultimately, would you say, a theory? is a another form of currency? Or how would you describe a theorem? I think we both could say that Bitcoin is definitely a form of currency. How would you, how would you describe a theory?
Anthony Pompliano 16:51
Yeah, I think that what is unique about Bitcoin is that it is only trying to do really one thing, which is be that currency, right? And so that’s why I say when you draw that line, it’s like, hey, what’s trying to be money? Okay, Bitcoin is trying to do that. These other platforms, they have aspects of money on them, right? I always joke that like an airline has all kinds of miles and flights and you know, different incentives, whatever. But what you’re not going to do is you’re not going to take your airline miles and go to Starbucks and buy your coffee with it. Right? It’s only used within that ecosystem. And so same thing with the theory and they have an ether token, you can use that to pay for things within that ecosystem. But you can’t take it outside of the ecosystem. And so, you know, yes, it has a currency element to it. But really, the kind of focus of the developers and the people who are working on this is to build that operating system, which then applications can be built on top of and ultimately serve the users that are kind of like at the end of the experience.
Anthony Scaramucci 17:47
Okay, I mean, so let’s, let’s go over a couple of these. So what’s the difference between an Aetherium and say something like Solana?
Anthony Pompliano 17:57
Well, Solana is going to work and Aetherium is not No kidding.
Anthony Scaramucci 18:01
You’re bullish on Solana. I’m,
Anthony Pompliano 18:03
I’m kidding with that comment. Yeah, no, I definitely am.
Anthony Scaramucci 18:06
And that’ll be, that’ll be the headline from the show, which is what I love about, you
Anthony Pompliano 18:10
know, the look, Solana basically had the benefit, right? Aetherium looked at Bitcoin there’s a gentleman Vitalik Buterin, who he actually was working on Bitcoin he was writing for Bitcoin magazine. He was very into Bitcoin. I think he still is into Bitcoin, if you were to ask him, but he realized, hey, this blockchain technology, I can manipulate or change it in some way, evolve it so that I can do something else with it. That was the birth of Aetherium. Solana basically had the benefit of looking at Bitcoin, looking at a theory on this. And hey, we can make some changes. And we can really go after what they were looking for as high throughput lots and lots and lots of transactions, and to do it very inexpensively. And the idea was, the more inexpensive the transactions, the more people will want to use it. Right, the more use cases that come. And so they’ve done a fantastic job doing it. The reason why I say I’m bullish on Solana is not because I’m some, you know, smart person who’s figured out something and no one else has, I just look where the developers go. Right? When I first started investing, and I remember when I wrote my very first angel investment check, I asked somebody who was very well known angel investor, what’s the secret? How do you find great companies? And he said to me, never think you’re smart. Always just follow the developers. And it has, you know, over and over and over again, always been right. And I think Solana in terms of that developer activity shows that people are building there and there’s a lot of value that’s going to occur.
Anthony Scaramucci 19:22
So are they building there and Aetherium? Or have some of those developers moved from Aetherium to Solana? Both,
Anthony Pompliano 19:31
I think some people are saying hey, look, you know, I was building on a theory and before, for whatever reason, I don’t want to do that anymore. Could be technical could just be a hey, I want more intellectual stimulation and a new challenge. And they go to Solana, some people have been building on Aetherium or other blockchains. And they realize users are flowing the Solana and so they say let me go build we’re kind of the users are let me go fishing the biggest pond. But some people are saying, Look, I’m building on multiple blockchains, right? There’s many, many projects or applications that are very popular right now that are on all kinds of blockchains right? If To look at stable coins stable coins are basically a digital token that’s backed by $1. So when you buy it, it’s $1. Similar to if you go to your bank account, you get $1 sitting in there for every digit that’s sitting in your bank account. Well, the stable coins are actually popular on blockchains that people wouldn’t expect. For example, tether, which is the largest stable coin, the most popular blockchain is on Tron, which started out and a lot of people kind of dismiss it. They’re like, this is stupid. What is this thing? It’s a scam. Right. And so what I think ends up happening is tether doesn’t care if Tron Aetherium Solana or anywhere else ends up being the place that works. They want to be everywhere for everybody. And so their application will be across these different platforms.
Anthony Scaramucci 20:40
Right, and just for our viewers and listeners, what Anthony’s referring to tether is actually a stable coin, on the internet. And so what ends up happening is you can store value in US dollars in tether. So if you’re in Bitcoin, and you want to trade out a Bitcoin and put it into US dollars, but not come off the chain, so to speak, you can store it in something called tether. You can also store it in the circle stable coin as well. And so there are a theory and based stable coins and Solana based stable coins. And I think with Anthony’s pointing out, his tether is sort of like a Swiss army knife for all of these different technologies, all these different tokens when you want to swap out of the token into US dollar. You can do it in the form of tether. Is that fair to describe it that way? Anthony?
Anthony Pompliano 21:33
I think a great analogy is Facebook has a iPhone app. They got a web app, they can go to facebook.com on your computer. And they also have an Android mobile app, right? They don’t care where the user is. They want to be everywhere. And so iPhone Android desktop, it doesn’t matter. Same thing with tethers doing they don’t care what blockchain you’re on, right? They’re gonna be everywhere. Okay,
Anthony Scaramucci 21:51
so you talked about mining you mind Aetherium? is can you mind something like Solana? And obviously there’s Bitcoin miners, and there’s companies that are set up to be bitcoin miner. So what is mining? Extract? Describe that to somebody? Yeah. So let him tell us if you’re able to do it across different tokens. So
Anthony Pompliano 22:13
let’s talk about Bitcoin mining. First. I think that, you know, it’s kind of always the the place to start. The way that the Bitcoin Blockchain works, when it’s decentralized. The only way that it really can work is if a lot of people aren’t participating, right? And so rather than have that centralized hierarchy and decision making, now you have decision making all around the world, the way that I describe the Bitcoin Blockchain is actually like a game of Monopoly. So if me, Anthony and two other people sat down to play Monopoly, we would set up the board, we put our money out in front of us, and we would start to play. Now the way the blockchain works is imagine as I rolled first, I had a legal pad sitting next don’t don’t play
Anthony Scaramucci 22:48
with Dierdre Scaramucci, by the way, because she will beat your brains. And I think I lost 10 Straight in a row to her
Anthony Pompliano 22:55
she can’t when I grew up in a family of five boys, we never we’ve never finished the game. Somebody flips the board.
Anthony Scaramucci 23:01
You’ve got sorry about the phone are in there. But so it’s the legal pad.
Anthony Pompliano 23:07
You know, let’s say we start at 10 o’clock. Right. And so 10am And I say, okay, Anthony Scaramucci pays Anthony Pompliano $200 10am. Then all of a sudden, somebody else owes you $100. And I right, somebody else owes Anthony Scaramucci. $100. Right. And I keep doing that. And for 10 minutes, I write down every single transaction. That’s a criminal legal pad. After 10 minutes. Okay, pause, I rip off the sheet of paper and I put it to the side. We keep playing, I write down every transaction again, I’m a second piece and we keep doing this right? Every 10 minutes. Each piece of paper represents 10 minutes, then all of a sudden, you say, Hey, you see that guy sitting over there? I think he’s got my $200. And he says, you know, Anthony, I paid you the $200. We go back into the stack of papers and we see 1047, right? This guy paid you $200 Okay, we’re good. Let’s keep playing. Right? That ledger that that record of what’s actually happened is what the blockchain does. So every 10 minutes, what the blockchain is doing is is looking at all the transactions that happened in the last 10 minutes. All of these miners are basically looking at it along with Node operators saying, Yep, everything looks good. No one’s cheating. No one’s doing anything illegal. And then what it does is it basically freezes it, it drips the paper off that legal pad, it says, Okay, we’re not going to touch this anymore. It’s immutable now. And it’s going to be chained to the last connection. And so when you think about it, each piece of paper is a block of transactions. The blockchain is a chain of blocks of transactions. And so what miners are really doing there are miners are making sure that the rules are enforced, making sure no one’s cheating, right. Now, why would they do this? Because it costs money, you got to buy equipment, you got to spend money on energy, you got to go and run the facility, etc. It looks just like a data center. They’re doing it because they’re getting paid to do it. So when bitcoins monetary policy was written, Bitcoin is putting Bitcoin into circulation every single day right now. 900 Bitcoin a day come into a circle They shouldn’t the miners all around the world are competing for those 900 Bitcoin, some days, you get a lot, some days, you don’t get a lot, right. But what the miners are really doing is they’re running a business. And so if you think of a data center business, there’s an entrepreneur who’s gone and bought computing, power, rented power, got computer hardware, and they have a sales team, they go up, they pitch for business. Here, what the miners are doing is they’re buying the hardware, they’re renting the power in the facility, but they don’t have to go pitch for business. They don’t have a sales team. They simply just turn their machines and pointed at this algorithm, they run the algorithm, and they’re paid for doing so. And so it’s a very, very profitable business if you run it correctly. And so there’s a constant incentive for more and more people to join as miners. And what’s ended up being the result of that is the Bitcoin network is the single, largest and strongest computer network in the world has more computing power running it than anything else in the world, because of that free market incentive.
Anthony Scaramucci 25:54
Okay, again, brilliant exposition. Why does the government not like this stuff? Like, why is somebody like Elizabeth Warren? So anti crypto, and we get clients or viewers saying, you know, it was crypto used to hide money? Is it for terrorism? Why is somebody like Jamie Dimon who I think is probably one of the smartest people period, the end? You know, why is he saying shut it down? And so on and so forth?
Anthony Pompliano 26:24
Well, you know, first on the commentary in terms of like, what are some of the issues, right? Terrorism, criminals, etc. Criminals use toothbrushes. Criminals use cars, right? They fly on airplanes, and they wear clothes. No one is saying that, hey, we shouldn’t let them wear clothes or used cars or use toothbrushes. And so what really is kind of the crux here is it’s kind of like the boogeyman, right? is like, Oh, they use this thing. When you actually go and you look at the details, there’s a former director of the CIA who did a big study, and what he found was less than point 4%. So less than one half of a percent of all transactions on the Bitcoin network are for nefarious or criminal use cases. And if you compare that more than $2 trillion a year is just money laundering alone in the Fiat world. And so the criminality is actually much more prevalent in the Fiat US dollar system than in the crypto system. Now, why is that? Well, it’s a public ledger. And so if you go talk to the DEA, or the FBI, or law enforcement, they love when people use Bitcoin for criminal activity, because there’s an immutable record out in public that can be looked at at any point that they can trace. And now there are stories after stories where they are finding previous criminal. So use this stuff, by tracking down with new technologies. And so criminals are coming to their senses and realizing we shouldn’t be using this technology, let’s stick with cash. Now, why do some of these people hate it, I would separate the critics into two categories. There’s the people who actually don’t like it, I believe Elizabeth Warren actually doesn’t like it, she actually would like to see it shut down or kind of, you know, put back in the box. I don’t think that’ll happen. But but that’s her desire. People like Jamie Dimon, it falls back to kind of a different category, don’t listen to what they say, just watch what they do. And you can’t at one point, go and testify and say, Hey, we shut this down. While at the same time you’ve got you know, 200 people running a blockchain team inside of JPMorgan, you can’t be a participant in the Bitcoin spot ETFs. And going in and providing capital and going to help, you know, push those, if you’re also saying that you think it should be shut down. And so everyone, I think, understands kind of the game that gets played. A lot of times when folks go in front of politicians and regulators, etc. Executives will share either a personal opinion, or share a certain view of the world, but they also have a fiduciary duty to their shareholders. And so you can think that it’s the worst thing in the world. But if this is the technology that may disrupt your bank, you probably need to be able to say to shareholders, hey, I was doing my best to stay ahead of this thing. And we were also simultaneously working on it. And so I think that that second category, there’s a lot of talking a lot of critiques but really their actions speak much, much louder than the words
Anthony Scaramucci 29:04
Okay, so very, very helpful. I want to keep going. You have something called a halving Okay, is that only for Bitcoin or is that for everything?
Anthony Pompliano 29:16
But bitcoin is the only major cryptocurrency that has this. Again, when we talked about the monetary policy, there’s 21 million Bitcoins will ever exist. About 19 million of them are so are already out in circulation, the way they got into circulation is every 10 minutes 50 Bitcoin were distributed for the first four years. After four years that number was cut in half from 15 to 25. That is the havening right every four years, the incoming daily supply is cut in half. So went from 15 to 25 to 12 and a half to 6.25. And now is going to get cut in half again coming up here in April or so. And so that having point I always say is important because it’s basically a supply shock, right. Imagine if gold miners all Sudden tomorrow, everyone decided they’re only going to dig up 50% of the gold they were digging up last year be a big deal. If demand for gold stayed the same, the price of gold would have to rise because there’s less gold coming into the market. That’s what happens every four years with Bitcoin. And what we’ve historically seen is that the price of Bitcoin rises very aggressively about 12 to 18 months after that having period.
Anthony Scaramucci 30:23
Okay, so that that is a program design, which decreases the supply of Bitcoin, which theoretically would then potentially increase the value of Bitcoin. Is that fair to say? Because every time that that’s happened, Anthony, we’ve seen appreciation in Bitcoin.
Anthony Pompliano 30:45
Yeah, I mean, it’s just supply and demand, right? I don’t got a big brain. I didn’t pay attention a lot in school, but I do remember economics one on one. And what they taught us was if supply goes down, and demand goes up, and the price has to move to be able to clear everyone. And so that’s ultimately what happens here as the supply is going down with Bitcoin. There’s also other supply dynamics like last Bitcoin, etc. And demand seems to be rising. You know, if you go back 10 years ago, it was basically crazy people on the internet. Now we’re talking about Larry Fink going on national television talking about how great bitcoin is. And so as global demand rises, and supply decreases, the price should still have to keep going up to accommodate everyone.
Anthony Scaramucci 31:24
Okay, so you mentioned Larry Fink, I met with Larry Fink. In Abu Dhabi a few years ago, he was negative on Bitcoin. Obviously, Jamie’s negative on Bitcoin. I was negative on Bitcoin, you were told by a very smart engineer to be negative on Bitcoin. Most people start the journey as not understanding Bitcoin and being negative on Bitcoin. Explain your eureka moment, if you don’t mind. And then I’ll try to explain mine quickly, and then we’ll go to some questions from our outside audience.
Anthony Pompliano 31:58
So the easiest way to describe it is just, I now have just started calling it the trait of our generation, which is what is the one thing that you’re the most certain of in finance, and for me, it is that they are going to continue to debase the currency, period, right? national debt, bunch of issues, but they’re gonna have to continue to debase the currency. If they continue to do that. Things that are priced in dollars are likely to be much more valuable in the future. We talked about real estate stocks to a degree, Bitcoin, et cetera. And Bitcoin to me what the aha moment was, is that it was a currency that could not be manipulated, no one could hold it, no one could create more of it. And so what I liked about it was it was frankly, 180 degree different than all the fiat currencies in the world. And what I saw was that it was very similar to gold, it had sound money principles outside the system, no one could create more of it. But what I’ve known from being a technology investor, is that the digital version of an asset is always at least 10 times bigger than the analog version. So if you go back throughout history, and you look at tons of things that have been digitized over time, they end up being worth 10 times more, you can imagine something as simple as email versus physical letters. Right? How much bigger is it when you do that? Think of TV stations versus all of the internet on YouTube. Right? The digital version ends up being worth much, much more. And so if bitcoin, just simply as digital gold, and when I first came across it, it was worth not a lot. Well, unless something catastrophic happens or an external shock, it’s probably gonna be worth a lot more in the future. And so it was a bet worth taking. What about you?
Anthony Scaramucci 33:39
Yeah, so my eureka moment was actually in the White House. I don’t think I told you this on your podcast. I was. And it happened on a Wednesday and because I was only there for one Wednesday, so that’s how I know it was a Wednesday when the when two fed guys showed up with the white paper discussing the digitization of the US dollar and using the blockchain to do it. I said, Okay, I didn’t What do you mean like blockchain like Bitcoin? And they said, Yes. And then they said to me, man, you should really get up to speed on what Bitcoin is. And then I got fired. Shortly thereafter, I went and bought the URL skybridge bitcoin.com. But even then, Anthony, I was very, very cautious. My first time on your podcast if you remember, we were discussing the history of money. And we were discussing my interest in Bitcoin, but I had not yet made a Bitcoin investment. And then obviously, in October, November, after long conversation with Michael sailor, we started deploying eight and then eventually nine figures into Bitcoin. We actually own things like Solana and Aetherium as well. Let’s take some outside questions. I think we’ve got a voicemail caller left us a voicemail a few days ago. Let’s play that one first, and then we’ll take some outside questions.
Speaker 2 34:56
Anthony. My name is Jeff from Connecticut. I’m curious on your thoughts. About the helium network, do you think it has any legs, I’ve been running a helium minor and haven’t really made anything from it yet. But all the crypto on the rise, I’m optimistic free think.
Anthony Scaramucci 35:12
So and I’m going to ask you to take that.
Anthony Pompliano 35:15
So I’m looking right now for the exact data. But helium, basically, for those that are unfamiliar, is, it’s a mobile network that, again, is kind of decentralized and distributed. And people can buy a machine, they can basically plug it in, and they help provide, you know, some sort of mobile coverage to those that that are around them. So you can imagine in New York City, there’s much the cell towers right with Starlink, they maybe be sending them down from satellites. But what happens if people actually own it, and they can just put it in their house very similar to like an internet modem, and you provide coverage in exchange for doing that you get paid helium tokens when people use that service that you are providing? Now, that sounds like Ah, okay, maybe that’s crazy idea. Maybe it works, maybe it doesn’t. Here’s the interesting thing is that the helium network is now actually traveling much more than the T Mobile Network, or I’m sorry, the helium network is closing in on the T Mobile Network, in terms of the amount of gigabytes that’s actually traveling on this network. So is becoming much, much more popular. Now, if users actually end up adopting this. And they actually are able to withstand or withstand any sort of drop in that popularity, then people end up owning that cellular network versus a centralized company. And so if that was to occur, of course, the token and the network would become much more valuable. The reason why I think people are cautiously optimistic, hesitant, whatever word you want to use, is because there has been a number of these examples where if you’re paying people, they show up, right? They’re not missionaries, in terms of people who want to go build Facebook or Amazon, they’re mercenaries, they’re like, Hey, you show me I buy this machine, I plug it in, I get paid some money. Okay, cool. I’m gonna do that until there’s enough people doing it where the return is gone down, and I just move on to the next thing. And so you got to be careful. But right now, helium is probably one of the best examples of what is possible with these decentralized networks.
Anthony Scaramucci 37:07
Okay, it’s great. It’s a great answer. I’ll just add that we own both the equity in helium, and we own the helium tokens. For those reasons. There was a great New York Times article, perhaps we can put that link on our website about how helium is one of these tokens is actually has great use cases in the world, and is being used all over the place. And so we like it. It’s also Solana based token right. And I mean, they’re trafficking on the Solana network, which is a fast, low cost network, which is another reason why we like it. Um, before I go to the let’s take this email, but before I get to the email yet, what keeps you up at night? What do you worry about?
Anthony Pompliano 37:53
And then we’ll go to the in life or in, in Bitcoin and crypto.
Anthony Scaramucci 37:57
Why don’t you give me both? Oh, in
Anthony Pompliano 37:59
life is just making sure I’m happy. Right? As long as as long as I’m happy, I’m good. But if if not, then, then there probably be some issues. And then when it comes to the financial world, you know, it’s just kind of there’s this thing, or if my daughter gets upset, that could always be bad.
Anthony Scaramucci 38:17
That was like, right on cue, so yeah, perfect. This perfect. Every parent listening knows, you’re as happy as your least happy child. The facts. Every parent knows that right? 100%.
Anthony Pompliano 38:29
On the investment side, I’m a big Andy Grove, only the Paranoid Survive believer. Amen. Right. And if you think about, I’ve got another friend, Matteo, who runs a company called eat sleep. And he’s at the saying he was this shit is coming. Right? Like, just like, just keep in mind, no matter how good or bad a GM, like shits coming. And so I think that it’s less about like, there’s a specific thing. It’s more of just what are the risks that we currently face? And how do we kill those risks? Right? If you think I’m most entrepreneurs, the non entrepreneurs would say, Oh, they’re risky. They’re risk takers. They take a lot of risks. But actually, when you talk to great entrepreneurs, they’re risk killers, right? They don’t want risk. They want to get rid of that risk. And so I think it’s just trying to constantly stay ahead of what are the things that could potentially hurt us or take us down and make sure that we reduce or mitigate as much as possible?
Anthony Scaramucci 39:19
Well, that is a great answer. I mean, I sleep very soundly at night, because I am a little sunart, which is a Italian expression for I guess I’m just either stupid or I’m just too tired. One or the other. Let’s go to the let’s go to the email questions. Can you explain the Bitcoin ETF and what in kind and cash settled mean? Does it really matter? Why are we being forced to do one over the other and this is from Mike from Arizona? And Mike, thanks for tuning in to speak up.
Anthony Pompliano 39:53
Yeah, I mean, the Bitcoin ETF basically is just another way to get exposure to Bitcoin. You know what it is not is that you’re not buying Bitcoin. You’re was buying exposure to Bitcoin. But there’s a lot of people who can’t buy bitcoin, if you’re a large institution, if you’re not comfortable buying Bitcoin and holding it, but you want exposure to the price, then ETFs are a great solution. The difference between in kind and cash settled, we could spend hours on the nuance, basically, what I explained to people as if you’re buying the ETF, you don’t care, right? The only people who care are the people who actually manage the ETFs. And the cash settled could be a little bit more difficult for people like greyscale, who already have a lot of Bitcoin. The inkind could be kind of a new twist for people who are starting a brand new ETF, but ultimately, the end user doesn’t really care and neither direction.
Anthony Scaramucci 40:41
Right. And I think that they’re why the government is doing this, in my opinion. And Anthony, you chime in. Michael, they want to a Cash to Cash Transaction. They’re afraid of people that have Bitcoin, that may be outside of the AML KYC protocols that can swap their Bitcoin into the Bitcoin ETF and so I think we’ll eventually get that but at least not right now. Let’s go to one more email and then we’ll let you go my friend. I’m a senior I don’t wish to involve myself with multiple altcoins and wallets. I have some bitcoin on a trays or, but but should I be adding eath and my I missed buying Solana in time Sanjay from Canada. So I’m going to start by saying I don’t think you’d miss buying Solana. And if you’re listening to this show, Anthony said something about pride. And Anthony says something about having too much pride or being too much emotion baked in when he sold his ease, and then watched it go up. But now is that 2400 He sold it to 300 could have bought it back at 500 and made a fortune. But I don’t think you’d miss Solana I think is a very, very good opportunity for Solana. But Anthony answer that question for Sandra from Canada. Yeah,
Anthony Pompliano 42:01
I think it’s all about time horizon. Right? If you said to me, you’ve got to pick one coin that you think is going to be around 20 years from now, the only one I’ve got really deep confidence in his Bitcoin, right. And so I keep majority of my portfolio there. If you say to me what’s going to happen in the next six months or 12 months, I believe that we started a new bull market. And most if not all, of these assets are going to go up to some degree, some of them will go up more than others, but for the most part, they kind of all rise together, there’s there’s high correlation. And so I do believe that it’s kind of a story of like, being in the market is more important than where you are in the market. And then time in the market is more important than timing the market. And so if you get those two things, right, then you’re probably okay. And then any decisions you make between individual cryptocurrencies, etc, is you’re just optimizing, you know, potentially a good investment between good and great. But as long as you’re in the market in some form, or fashion, in a risk way that you can kind of handle you should be in good shape.
Anthony Scaramucci 42:57
Okay, I just want to ask CONTROL BAR control room. And the other email questions before I say goodbye to Mr. Pompliano. Our is our last one Anthony ready. The theorem adoption for use with smart contracts does not appear to gaining much momentum in the marketplace. It’s it’s solving problems, or just an additional layer. This is Kyle from Nevada via email. Yeah, I
Anthony Pompliano 43:22
definitely think that it’s solving a problem. You know, smart contracts are not only getting more and more popular in Aetherium. Now they’re starting to infiltrate on to other blockchains as well, Bitcoin, for example, is now starting to figure out how to bring smart contracts to Bitcoin. And so is a theory, I’m going to be the place where smart contracts end up being the dominant thing, and that’s the one that survives, or do smart contracts become popular somewhere else? Not really sure. But what I do know is that a smart contract is just automated code, right? It basically says if then, so if Anthony gives me the deed to his house, then I give him the money to buy the house, right? And so that’s something that’s been going on for a long time, we now have this new term smart contract. But really, it’s just code that executes based on preset parameters. And so I think that that will always be something that’s important in the software world.
Anthony Scaramucci 44:10
Anthony, how do we find you? Okay, you are a fascinating human being. You’re an young entrepreneur, I think your your your generations, Kenneth Langone, hopefully I’m gonna see your name on a hospital someday or even bigger than that. Maybe even a university. How do we find you?
Anthony Pompliano 44:27
Just on Twitter? Just twitter.com or x.com? I guess now, a Pompliano. Just my first initial last name, and
Anthony Scaramucci 44:35
I do plenty of you but you do a podcast. We find
Anthony Pompliano 44:39
why tweet the podcast every day. So if you’re on Twitter, then you’ll see the podcast but it’s just the pump podcast.
Anthony Scaramucci 44:45
Newsletter, I’m a subscriber to your newsletter. How do people subscribe to your newsletter? Pomp
Anthony Pompliano 44:50
letter.com. And I have a steam guest like Anthony Scaramucci join all the time.
Anthony Scaramucci 44:57
Yeah, but you know, you know what, I love it. because that I tell you symbols and you use Italian symbols. See that? Yeah, of course then someday there’s going to be a lot of Italian singles built into one bitcoin token. That’s for sure. Anthony, thank you so much for joining us on speak up with Anthony Scaramucci, guys, you can send us voicemails emails, you can dial into the show nine to the mooch 928-436-6624. So grateful to have you on and I hope you’ll come back.
Anthony Pompliano 45:29
Absolutely. Thanks so much for having me guys and hope it was valuable.