Power Without Permission

I don't have to worry about money anymore. I can fund all of the needs that I have and all of the wants that I have through a retirement and perhaps even earlier than that, if you're smart about it, and there's some strategies and techniques that I write about very, very consistently on how to do that. That is a really great goal to have for any individual, any family, but it does leave the question begging what happens if I actually can't access that wealth that I've saved up for decades. And the answer to that question is, well, you should have bought some Bitcoin because it's the only thing that you actually can truly control and own in this world that you don't have to rely on other people giving you permission for the hard-earned wealth that you've been able to bring into your estate. Trey Sellers, welcome. Hey, Sean. So good to be with you, man. So good to have you. We're long overdue. I'm glad we got to reconnect recently in person and get a time on your calendar to do this.

And I think, you know, we go back a few years, Trey, in Bitcoin and otherwise. And what I'm excited to talk with you about today and I hope will be, I'm confident will be very helpful for those who I often say are perhaps on the bubble. You know, they know the money's broken. They know inflation is a huge drain. on their lives, but perhaps they just don't quite know what to do. They might be familiar with Bitcoin, but uncomfortable with taking that step. And so, you know, while we're not going to go through a tutorial, though you offer fantastic help as I am a client at Unchained, we'll touch on that. I think this really is to talk about the why. And from your perspective, I think you've got great insights on the why. And so let's start by talking about the fundamental power imbalance. in money. You spent 15 years at Goldman Sachs, Truist, other major financial institutions.

From that vantage point, talk to us about the power dynamics between institutions and individuals in traditional finance. Who holds the leverage? Who holds the information? And where do these asymmetries show up? Well, I think the answer to that kind of lies in the question and the implication for that question, which is that, of course, these large financial institutions and banks hold a lot of leverage over people's financial futures. The financial products that you own, the stocks, the bonds, to a large extent, the real estate, all of these things are very tightly controlled by the financial system that has grown up over the last, call it 100 years. And, you know, those stock certificates for the ETFs that you own or the individual companies that you own, they're held by the DTCC. You don't actually have ownership directly in those. You

kind of have rights to some of the benefits that come from a exposure to them. But there's There's not really a direct line of ownership between you and the financial tools that most people are using to secure their wealth and build toward a retirement, a nest egg, a legacy for their family, and that kind of thing. And Bitcoin very promisingly provides the exact opposite of that, which is, you know, one of the things that intrigues me about it so much is that you can actually directly control and directly own the wealth that you are building with Bitcoin. and not have to trust in this extraordinarily obtuse and complicated financial apparatus that most people are purely plugged into. I write a lot about financial independence and the intersection there with Bitcoin.

And the traditional way that people think about financial independence is purely on a value-saved spectrum, which is that, hey, if I start with zero and I reach X number some years later, I don't have to worry about money anymore. I can fund all of the needs that I have and all the wants that I have through a retirement and perhaps even earlier than that if you're smart about it. And there's some strategies and techniques that I write about very consistently on how to do that. But it's very narrowly focused on that. That is a really great goal to have for any individual, any family. But it does leave the question begging, what happens if I actually can't access that wealth that I've saved up for decades? And the answer to that question is, well, you should have bought some Bitcoin because it's the only thing that you actually can truly control and own in this world.

that you don't have to rely on other people giving you permission for the hard-earned wealth that you've been able to bring into your estate. And that's a crucial point. I mean, how does the permission structure of traditional banking shape who gets to participate and how? Because I think, you know, at Truist, you were running risk models. You've done that work elsewhere. So, yeah, talk to us about the permission structure. You know, as you say, who gets to hold what, who gets to access what and what, you know, I think frequently happens. We hear these stories about people showing up to take their cash and they can't. So, yeah, permission structure. Well, the cash doesn't exist. I mean, it does exist on a ledger somewhere and there's some portion of the money supply that is available in cash and that circulates around the economy. But if you go into a local community bank or commercial bank branch and you ask for $50,000 in cash, first of all, you're going to get a lot of questions as to what that cash is going to be used for.

And very likely they're going to say, great, come back in a week. We need to order that. Right. They don't they're not just sitting like I think the old Western, you know, thought of a bank is that it's just sitting on this safe and a pile of cash in the back. And that's where your money is held. And then whenever you need to access it, you go in and you can withdraw it. That's just absolutely not the case. It wasn't even the case. And it's a wonderful life. And that was the 40s. No, exactly. And obviously, like that, that really sits at the base layer of what leverage is built into the financial system, the fiat financial system anyway. Money is a very weird concept in the fiat world, right? Because it kind of doesn't exist. I actually think, you know, a lot of people talk about Bitcoin as being intangible and it's digital and you can't really hold it and that kind of thing. I actually think it's a lot more real and tangible than the dollars that you're holding.

Sure, you can pull out a $20 bill and this is a tangible thing that's in your hands, but it actually just represents a spot on some kind of amorphous ledger that's out there that really the banking system and the Federal Reserve are managing on behalf of the economy. And there's accounting rules involved in how all of these debits and credits and assets and liabilities are structured throughout the economy in the U.S., but then also globally. But it's very abstract. It's very complicated. It's very not tangible, unlike when you're holding Bitcoin where you've got the private keys there. Like this is actually it's it's it's digital, but it's it's physical in nature in the way that you actually interact with it. And then it can be transformed into kind of a physical representation through a seed phrase, through, you know, hardware devices and that kind of thing. It's actually like so much more real than the dollars that you see in your bank account.

Well, and that's a great seg. So, you know, to get into Bitcoin and sort of this redistribution of power away from the institutions to the individuals. Bitcoin's white paper talks, of course, about electronic transactions without relying on trust. That's a quote. But I think that that, I would argue, and I'll see what you think, undersells what actually changed. It seems like Bitcoin fundamentally redistributes power from institutions to individuals, as I mentioned, and from gatekeepers to, as you said, anyone with keys. And so how do you view this transformation? What specific sort of power dynamics shift when money becomes a bearer asset rather than, as you said, a ledger entry? I think that you're absolutely right that there is a power dynamic that shifts here. I think about it as kind of the leverage that a single individual has with a gun kind of pointed

at a crowd of people who don't have a gun, right? Like if you think back a long time ago when like gunpowder was invented and firearms were kind of just coming of age, if you're a guy with a musket and you're fighting people with bows and arrows, you've got a strategic advantage. You've got leverage in the situation that puts you as an individual at a much stronger position relative to the group that might be attacking you or the people sitting on the other side of the table of this interaction. Right. And so, you know, if you are not reliant on other people to give you access to your money, you don't have to ask permission when you want to interact in the economy. When you need to go out and get the goods and services that will provide you with sustenance and solve for the needs that you have in your day-to-day life. When you need to move or go someplace else, either because you as a group or as an individual are being persecuted or just because you want to escape from the life that you've lived for a time and want to explore other parts of the world.

Um, when you're using the fiat financial system, you're, you're very much tied into the limitations that it has in terms of reach around the globe and in terms of the ability to actually just transact in the way that you see fit when you see fit. And that is really the fundamental thing that Bitcoin provides for you as an individual who has taken their sovereignty very seriously. And even the threat of that ability is something that keeps these institutions in check. Right. If, you know, in It's a Wonderful Life, the threat or the bank run that's that's happening there is actually putting a check on the financial system on that banking system because, you know, they couldn't come up with the money when everybody is demanding for it. And everybody's expectation is that, hey, this is my money. I've got a demand deposit with this bank, so I should be able to get my money in the current fiat financial system.

Think about it. There's endless bailouts and everybody knows there are endless bailouts. And, you know, a lot of people talk about fractional reserve in the fiat financial world. I actually think like in the way that it's currently constructed, there is no fractional reserve because the reserves are actually infinite because they will just print them. And everybody knows that. So the bank runs of old don't really have the same type of threat there because that money is conjured up out of nowhere in order to satisfy the nominal value of what you are owed from a bank. That cannot be done with Bitcoin, right? If I've got a deposit with a bank or an exchange, an IOU from that person that is denominated in Bitcoin and I decide I want to withdraw it, they cannot just conjure up new Bitcoin to credit to my account and send it to me. That has to come from somewhere. It has to come from somewhere. And then, again, like this goes back to just how tangible Bitcoin actually is.

I, when I hold private keys to Bitcoin, when I take that sovereignty to myself, I have the Bitcoin. Nobody else does. You cannot have this like dual nature of ownership in the way that you have with dollars in the fiat world. And I think, yeah, and I think that's actually a really profound point regarding fractional reserve is a misnomer or a myth because there is no end to the reserve. And I keep going, right. I keep going back in my head to, granted, it's a favorite movie of mine and Christmas will be here soon. But I keep coming back to that scene, the bank run, and it's a wonderful life. And now, as you've just put it, thinking that, A, you would be laughed out of the bank or, you know, put to a hundred questions. You know, reimagine that scene where you walk in and are either roundly rejected or you're asked to fill out a form to take out your money.

And number two, ultimately, the bank can't fail. Now, in truth, of course, the federal government gets to decide which banks fail and which ones. It has become a political decision as opposed to an economic decision as to which banks fail. Which is obviously has tons of moral hazard built into it. And there's a lot of implications of giving the banking system – the people who run the largest banks tend to have much more leverage and power in those types of situations. And we saw that very starkly in the recent episode with Silicon Valley Bank, right, where, you know, there's a lot of power dynamics that the larger players in this market have in order to make sure that, hey, they're not going to fail. But it's maybe OK if some of these smaller community banks or regional banks are allowed to fail or just be subsumed into the larger banks, which creates a consolidation, which creates more power.

And then, you know, but ultimately the fiat financial world and the banks, these financial institutions, they do, their power rests on this. It rests on this licensure that they are able to obtain from the state, from the government. that says we sit at this very strange privileged position where the entries that we put in our records are entries that other people are not allowed to do. We are the only people who are allowed to do this, which is to create money when we create a loan. Excellent point. When you take out a mortgage, there is new money that is created in that time. It will be extinguished There a lifespan associated with that new money But for 30 year mortgage that 30 years And then there some interest associated with it But for that 30 year time span you starting with let say of new money that

entered into the economy that goes into your bank account, uh, or the bank account of the people that you're buying the, uh, the home from, uh, and that new money then circulates and all of this, you can't do that as an individual. You can't do that as a non-bank. But as a bank, you have special licensure from the state that allows you to just conjure up new money. It's very strange when you think about it. It's very strange. And I would say it's also that that is a, you know, I wanted to almost put a period on that in the sense that that statement is so important, I think, for people to hear and know and understand. is they are creating money, you know? And conversely, and I think, you know, you talked, you raised some great points, Trey, about, you know, having private keys and how does that sort of change the relationship. What does it mean that Bitcoin doesn't care who you are, where you're from, your politics, or what institutions think of you

as compared to what you've just laid out? Yeah, you know, it's funny. I can this is bringing me back to some of the different training and stuff that people who work for banks need to go go through as part of the regulatory apparatus, which is all about like non-discrimination and this and that. Right. And yet. And yet we all know that this is a permissioned environment, that humans are humans and that, you know, some of these biases do seep into the way that people are interacting on a day to day basis. And Bitcoin does not see any of that because there's no real human involved. Like the only human involved is you. The only human involved is the person who decides I am going to create my own Bitcoin wallet, my own private keys, and then receive Bitcoin there. And the network obviously is completely blind to who is controlling those private keys, where this money is going from address to address.

It is truly the most egalitarian way to run a monetary system because it's completely blind to what those users are doing. Now, of course, there are scaling issues associated with Bitcoin, and we have to figure out how to manage that in a way that keeps as true to the way that the base layer works as possible. But, you know, fundamentally, the point that you're hitting on is that you as an individual, you as a miner can just interact with this network without asking any permission from anybody. And nobody can stop you from doing that. And I think it is worthwhile to contrast that again for those who may be new or newer to Bitcoin is that holding a Bitcoin ETF might be the right place to start. You know, you've got to start somewhere. But but what you've just described are inherent permissions, rights, abilities that only holding your private keys grants you. Right.

And I think it's you know, to me, it's it's quite important to underscore that is that if you are dealing with your brokerage, if you were, you know, holding your Bitcoin at a bank on a cash app, wherever it may be, you do not enjoy those rights. And I think, you know, as I say, I've got to start somewhere, but I think that's an incredibly important point to underscore. And let's again, bringing it back to, you know, the content that I'm writing on a daily basis. Right. What does it mean to achieve financial independence if you don't have the sovereignty over the money that you've saved going forward into the future, into your retirement? Right. Like the political system right now, the political like environment, the global geopolitical environment is really weird. And there's a lot of funny moving pieces here, funny risks that are out there that we don't really exactly know how are going to play out. And so it's maybe unlikely and you can put whatever handicap you want on different scenarios playing out.

I'm generally an optimist that things are going to work out. But that doesn't mean that it's a completely zero chance that, you know, some of these worst case scenarios could play out. It would make a lot of sense, even if you do have a large amount of trust in the financial system that you're using on a day-to-day basis, to at least have a little bit of a hedge there, right? And so that's a lot of some of the messaging that I like to have for the people who are coming to talk about financial independence from the traditional lens that they've got. That, hey, this does give you like an extra vector of freedom that you haven't really considered up to this point. Yes, yes. It's as if you saw my next question, which, you know, you have not. So as I was thinking about our conversation, you know, it's called trust revolution. And it occurred to me that really we could reframe it as the verification revolution. And by that, what I mean, and I think you've just opened that up nicely, is in traditional finance, you have to take institutions that they're word, that your balance is real, that they're solvent, that they'll honor withdrawals.

You know, Bitcoin lets you verify everything, the total supply, your balance, your transaction history, all of it. And so how does this shift from taking their word for it to prove it to me, change the nature of relationships between individuals and money systems? Well, for one thing, if you are holding your own money and you're not relying on an institution, it makes it a little bit more difficult for those people who are controlling your finances or helping you to manage your finances to kind of hide the fees that are flowing their way and to scrape whatever basis points off of the top of that. I think a lot of people don't have any idea how much they are paying their financial advisor, how much they are paying the issuers of the securities and the ETFs and the mutual funds and whatever that they own. Those expense ratios, the fees that are embedded into those things are sometimes a little bit hard to track down and find and to figure out what the actual total fee burden is.

And when you are just kind of blindly trusting somebody else with managing that money and actually dealing with the custody of it, it becomes that much more at arm's length where you can't really verify what is going on under the hood and how much you are being fleeced under the hood. Now, I don't mean to say that to say that financial advisors are just out there trying to screw over their clients. I don't believe that. But some. There are some. But the financial infrastructure as a whole absolutely is incentivized in that way, is actually structured in that way to extract as many fees as possible from the people who are using those services. And I have nothing wrong with people paying fair fees for services that they are getting. I would suggest that what you're saying is the information asymmetry disappears.

with Bitcoin. That's right. That's right. Because I can see, and in some cases, like if you're holding your own keys and you're using a financial advisor and they're maybe rightly entitled to some portion of like some percentage of the value that you've got there, at the very least, like if you're holding your own keys, you've got to be actively involved in sending them that fee, right? Which is going to keep them in check. It's a push, not a pull. Exactly right. It's a push, not a pull. It's so important. And it keeps them in check because they've got to now ask you for that fee and they've got to be very nice to you and treat you well. Right. And you're very much aware of the fees that you're paying. Right. So, again, this goes back to this power dynamic that you're referring to, which is that it shifts the power back to you if you are directly controlling the money and you have direct line of sight into what you own. Yes. Yes. And I think, you know, maybe to underscore that, whether it's your writing, FireBTC, or it's your work at Unchained, do any anecdotes or stories occur, Trey, with regard to you helping clients understand Bitcoin and then seeing it click that there is this verification, you know, capability?

Does that, you know, click at a particular time or have you got insights into when that really sort of becomes real? I think the majority of the clients that I'm working with in Unchain, the majority of Unchain's clients have already started to make that realization before they come to talk to us. We operate very much at the base layer of the Bitcoin stack, right? Like you are controlling your wealth directly. You're doing it in a very robust technical way, and we're here to help you with that. But, you know, I think most people who are first being exposed to Bitcoin, first of all, number go up technology is the number one recruiter for Bitcoin. That has always been the case. And I think it always will be the case, at least for the foreseeable future. And I think that's perfectly fine. What that means is that people are focused on Bitcoin for the very narrow purpose of making more money, basically.

Right. Like fair. I just want to increase my wealth. And if you don't know better, which most people don't know better when they're first starting to explore these ideas, the ETF looks great. Right. The ETF is a great way that I can ride the Bitcoin train into the sunset and I'm going to 10x my wealth, you know, and and I don't know to ask those questions around, you know, what is this exposure that I actually have? Right. And I think, you know, as somebody say, particularly those of us who are in the West and we're, you know, we enjoy certain benefits is it number go up is more important than freedom go up. But if you move to Central Africa, that that may well invert depending on the situation. But I take your point. Absolutely. Absolutely.

The people in Mexico who are, you know, they're living day to day and they don't have this like excess money available that they can save to actually save for the future. Right. Nor do they actually even think about that because it's not part of the culture to do that. The culture is that you're just kind of working your job or you've got maybe a little tienda or whatever, and you're just making enough to make ends meet and moving forward. And you're not necessarily thinking longer term. And I think that is downstream, like the culture of that is downstream from the politics and downstream from the money that is embedded in those societies. And because of the privileged position that we are in as Americans and the history that we've had around capitalism and the building of capital over a long period of time in a very robust way, it's more natural for us to think about long-term savings, about retirement, these weird things about retirement.

Like most of the world does not think about retirement. What is that? What does that word even mean? concept in their mind, right? Which blows our minds as Americans because we've grown up thinking, okay, yeah, I go to school, I get a job, I work for 40 years, I retire at age 65, I've got social security. And like, there's this norm that has been created. The arc is defined. Exactly right. And that did not exist for most of human history. And it's very – it's actually a very new concept, which is kind of strange to think about just because we've been so embedded in the idea of saying, hey, I'm going to like sail off to the sunset and just go – Once I've got this number. For 30 years, once I hit a number. Yeah, exactly. Well, and I think on that note, let's talk again admittedly about those in the West who are thinking in that way.

So from verification to credibility, and so traditional finance runs on credibility. You believe Chase Bank because it's been around for, what, 200 years. It's regulated. It's certainly too big to fail. Where Bitcoin runs on cryptography, you know, and math doesn't care about reputation or history. For someone building serious wealth, how do you help them think about these two different models or approaches to credibility? When does mathematical certainty beat institutional reputation? Well, there is a spectrum for a lot of people, I think. You know, like it's not bad that we have trust in society, that we built a society that has people that we can trust and institutions that we can trust for the most part. We'd be in trouble without it, right? I mean, though it's on the decline, arguably, we are lucky to have it. Yeah. Yeah. And so, you know, who was it? Reagan said, trust, but verify. Yes. And Bitcoiners kind of flip that and say, verify, don't trust.

And, you know, I think there's room for like a middle ground there, which is that you should absolutely take verification first and take that sovereignty into your own hands. But it's okay to build relationships with people that you trust and rely on. And that includes institutions that are providing very valuable services there. A large portion of the success that Unchained has enjoyed is in this paradox or contraposition of saying that we are going to help our clients to hold their money, their Bitcoin very sovereignly and have unilateral control over it. And by the way we you should trust us to be able to help you with doing that And you should trust us to be able to help you and do right by you when you are looking to convert some of your dollars to Bitcoin when you looking to borrow against the value of it when you looking to set up a retirement account that holds Bitcoin where you get like the trust embedded in the financial system and the rules order of a retirement account And yet you also get to hold your own keys to control that Bitcoin directly as part of that

It's a strange concept to a lot of people, but I think that the trust that Unchained has been able to build in the way that we've approached the market in a very conservative way and building for a very long term, a very long term oriented low time preference approach has enabled us to be successful and to attract the types of clients that we want to attract, which are those people who take sovereignty very seriously and yet also want to make sure that they are have all the financial services built around them that they actually need in a go forward basis. Well, and without naming names, of course, I wonder, Trey, if you have, you know, some stories you could share about clients, colleagues where, you know, that Bitcoin's cryptographic guarantees have saved them as opposed to institutional promises. You know, I don't know if you find yourself in those situations where, you know, you had to move some money at 2 a.m. on a Sunday or other sorts of insights into making that real for those who are thinking about this and really trying to conceive of what this shift might look like.

I'm thinking right now of a business owner who runs a SaaS company, who I think you are acquainted with or know as well, who had all of their cash at Silicon Valley Bank when that whole episode was happening. and following on from that episode, he as a great Bitcoiner and a client of Unchained was able to make the case successfully to the board of the company to say, hey, we cannot allow this to happen again. We need to have this hedge in the form of Bitcoin that we control the keys to so that if there is some type of issue or hiccup, we can make payroll the next week, right? And that weekend was very stressful for a lot of business owners who were using Silicon Valley Bank as their banking partner. And could you, by the way, give us a little give us a little back story on what actually happened there.

Yeah. So Silicon Valley Bank is a bank that was very like tech focused in terms of the clients that they had. And what happened was there was some kind of mismanagement of their balance sheet. when rates on treasuries was very, very low, like, you know, 25 basis points or what have you, they took the assets that they had that they collected from depositors and all of this, and they invested it very heavily in U.S. treasuries that were long dated. They were bonds. They were not like short-term bills. And what that means is that you have interest rate risk. It means that if interest rates rise, the value of those securities that you're holding on your balance sheet to maintain your cash position, to have liquidity that you can use for funding your business and making loans and all this, that cash balance dropped in value very rapidly.

If you're familiar with the way the bonds work, there's an inverse relationship between the value of the instrument that you hold and the interest rate coupon that it is paying. So when interest rates go up. And if they go up dramatically over a short period of time, the value of that security of that U.S. Treasury drops very dramatically in correspondence to that. And that's exactly what happened. The capital, the liquidity that depositors and that the banking executives thought that they had on their balance sheet dropped off a cliff very rapidly because the Federal Reserve came in and decided they needed to finally take action to quell the rising inflation that was happening back in 2022 and 2023. And Jerome Powell came in and raised rates very drastically. What was it like four or 500 basis points, four or five percent over a very

short period of time, collapsed the value of the bonds and basically made the bank insolvent, basically made the bank insolvent. And that led to a massive intervention from the Fed. They opened a program called the BTFP, which we don't need to get into the structure of that. But there was a cascade. Came in and they backstopped all of that. But before that program was released, essentially what happened was the bank was shut down over the course of a long weekend And as the regulators and the FDIC and the Fed were all coming together to figure out a solution for this, what they ended up doing was just printing a whole lot of money. They basically put in yield curve control. Yeah. Imagine that. All these terms. When all you have is a hammer, right? But over the course of that time period when this was playing out, the business owners who had their banking deposits, their cash balances, and the services that they were using for banking with Silicon Valley Bank, they did not know if the bank was going to open on Monday.

Was it going to be acquired? Was this going to drag on for weeks or months? And if that's the case and you can't access that money, how do you make payroll? How do you pay the people who are working for you? How do you pay vendors that are owed money for some of the supplies that you're buying from them or whatever? And so I think that experience opened a lot of people's eyes, including a lot of our clients, to say, hey, I've got this business. I've got a cash balance here. Some portion of that at least needs to be in money that I directly control. And what is a better tool for doing that than Bitcoin? There is none, right? It is the best tool for the job. And a lot of people started to realize that as a result of that particular episode. And then so that was a very long winded way of giving you one example. There are plenty of other examples where people are just individuals and they come to us either because they've had a terrible experience with something like FTX or something like Celsius, or they have made mistakes that have caused them to lose Bitcoin in the past, or they're just terrified of the prospect of making a mistake that would cause them to lose Bitcoin or not having their family be in a position where they can actually get access to it in a succession planning situation.

That is me. Yeah, as an example. Yeah. So many of my conversations are focused on that. And what Bitcoin's cryptographic nature and the way that the custody models that Bitcoin allows for the position that it's able to put you in is to help you solve those problems. How do I not lose my Bitcoin? How do I pass it down to my family? How do I access it as and when I need to? And that is how the cryptography that is built into Bitcoin really, really helps people in a very visceral, emotional way for themselves and for their families and for their businesses. Well said. And we are absolutely going to go deep into, you know, what it means personally. I do want to take a brief aside or make a brief aside. As I'm thinking about a lot of what you said and thinking about maybe my bias speaking, you know, but all of these sort of highly technical terms that we hear in finance and financial services. services. Could you net out for us, what is this wave and all this buzz about Bitcoin treasury?

You know, what does that really mean? I'll give you a cynical answer to that. I clipped myself because I was going to get my own answer and then I wanted to zip it. Okay. So the cynical answer is you as a buyer of a Bitcoin treasury company, basically a Bitcoin treasury company is a company that is using the tools available in the capital markets to raise money to buy Bitcoin for their own balance sheet. And the cynical answer to your question for people who are not part of those actual companies but might be interested in buying the shares of those companies in hopes of making money on the value of those shares going up is that you are giving other people money to buy Bitcoin on your behalf when you could just buy it yourself, right? And most of the time you're paying a premium for that privilege. Now, most people who are doing this are doing it because they want to go out the risk curve beyond Bitcoin. Bitcoin is very safe, right? Like we kind of know what it's going to do. It is volatile, but it's pretty much like, hey, I'm going to make 40, 50, 60% per year over time.

Sometimes it's not enough for people and they decide, hey, they're seeing dollar signs right behind their behind their eyelids and saying, I want to take a little bit more risk. And and the goal in doing that should always be. Can I outperform Bitcoin? There's no there's no reason to take that extra risk unless you think you can outperform Bitcoin. And historically speaking, some of these companies absolutely have for certain short periods of time. But the whole last year or so has been a very tough trade for some of this. I have a newsletter post about this specifically that was written back in June when the premium that people were paying for certain companies that were out there was very, very elevated. and there was so much euphoria in the market. Oh, these things are going to continue to go up in the moon. And I was getting the sense that, like, people just don't understand how the math works here

and what the actual risks are that are embedded in investing in these types of things. Right, because, oh, by the way, you are walking, you're walking or sprinting, you know, no judgment, do what you want to do with your money, but you are sprinting back into the scenario where you must trust and you likely cannot verify. And as you said, all the risks, all of the opaqueness that the traditional financial institutions bring is what you're staring at. And I'm actually really glad you – I'm glad you went there. I could have been more precise. And what I really meant to ask was about Bitcoin treasury strategies. And so what does it mean for a company? No, but it's great, right? So I think you've just painted a very clear picture of what to be aware of and what to, I would argue, steer clear of. But I would say that a Bitcoin treasury strategy is a fancy way of saying save in Bitcoin as a company. And I appreciate, as I know you do deeply, that if you're a small business and your operating capital is most of your operating capital requirements are most of your capital, then the volatility of Bitcoin may be very difficult to weather.

But in the sense that you do have free cash flow, is it really anything more than just, hey, as a business, do what you would do as an individual, which is saving Bitcoin so that as you as you laid out, you don't get into a Silicon Valley bank situation. Would you would you paint that differently? No, I don't think so. You know, there are a whole lot of different there's a there's a very broad spectrum of businesses who might have a treasury. Right. There's very closely held individual LLCs and that kind of thing, which, you know, there's really very little distinction between that and the personal Bitcoin that you hold. And then there are large corporations who have all kinds of very sophisticated treasury management apparatuses and rules for how they manage their treasury. And there's everywhere in between. I think the key point here is to say, and I can kind of illustrate this with an example from a recent trip that I had to speak with a CEO and a CFO of a S&P 500 company that is thinking of adding anywhere between $100 million to $200 million worth of Bitcoin on their balance sheet.

And in looking at the history of how they've managed their cash, and there's a lot of nuance here, so just bear with me, right? But if you look at this on a quarter-by-quarter basis, at the end of every quarter, they had no less than $500 billion worth of cash at end of each quarter. And upward of like – B, billion with a B. Sorry, 500 million. Did I say billion? Okay, still, you did, but that's okay. I was thinking – yes. Sorry. That was an impressive meeting, Trey. Yes. $500 million worth of cash on their balance sheet and anywhere up to $3.5 billion in some of these instances. And what I noticed is, hey, you've got this floor of $500 million. Well, if you layer in a calculation of 7% purchasing power erosion that could be taken from just the average monetary base or monetary –

The melting ice cube. Melting ice cube of M2, right? If you discount that cash over time, well, in the last 10 years, it has halved basically in value. What you could have bought with that $500 million 10 years ago is value that you can only buy of $250, $260 million worth of things today. And so the value of that cash is being eroded away and it's just sitting there in an asset that is designed to lose value. And so why would you do this? Why would you make this this some would say conservative decision? Others would say it's just highly not accretive to shareholders, let's say, right? Like you're just letting this money evaporate into the atmosphere. If you take some portion of that and you buy Bitcoin with it and you assume a very conservative increase in purchasing power over time, you can offset completely that erosion from the cash, still serve all of the liquidity type of goals that you have for the company and being able to fund the balance sheet or the P&L in the way that you want to.

And in some of the optimistic scenarios, actually massively grow that balance sheet in a way that serves the business to make acquisitions in order to just put a floor under the stock price that would otherwise just be kind of eroding away. And so there are a lot of different ways that you can think about doing this But the whole point of a business is to create retained earnings and to distribute funds to shareholders Well if you able to create more value by storing those retained earnings in the business without decapitalizing it and being able to fund other ventures that may return more than Bitcoin over time, that seems to me to be a really great way to think about it. And that's exactly what these folks are thinking about at this particular company. Well, if we then take, and I think the parallels are strong, if we then knock a few zeros off and we bring it back down to the individual.

Let's talk about individual sovereignty. And I want to talk very much about your personal story, Trey. You, as you share in BTC Fire, your newsletter, you share that you achieved financial independence in five years and left Wall Street to work on Bitcoin, which is not just a career move, that is a shift in values. And so what does it mean to you personally to hold wealth that requires no one's permission, no institution's approval, no government blessing. Like, help us understand. And this is one of those things that I've experienced that are hard to communicate until you felt it, but I'm going to ask you to try. How has that changed you as a person, as a father, in how you think about the future? Yeah, it comes back to some of the comments I was making before, which is that for me, me, like it's start my financial independence journey started as I really don't like my job

and I want to get out of here as quickly as possible. And I found this financial independence retire early framework that I that I write about on a weekly basis. And it kind of immediately resonated with me. It was like, hey, I can use the structure and I wasn't thinking about it this way, but I can use the structure of the fiat financial system that the stock market is kind of always going to go up. And there's always, at least historically speaking, has always been some delta between the of growth in the real purchasing power of being able to save in the stock market over time. And all I need to do is be very intentional about my spending and and then stock away, stack away my stocks as quickly as possible to get to a point where that savings portfolio can fund my lifestyle. And there's some, some, you know, pretty simple calculations that you can do to give you an idea of what that number looks like. But this started to morph the way that I

thought about my, my personal finances and the way that my myself and my wife, my family approached the idea of retirement. And prior to doing that, like, I, I was kind of rudderless, I really did not have a intentional approach to building wealth over a long period of time. I just kind of went where the tide took me or where the Gulf Stream took me, so to speak, right? And having this framework or this approach to personal finance really opened my eyes to the possibility that this is even something you could do. And that's a very important, I think, stepping stone for people when they're just starting to think about their personal wealth and their family's wealth and what building for the future actually looks like, taking that low time preference view that we have with Bitcoin. Around the same time that I found that, I found Bitcoin. And I started to actually realize that, well, if stocks are good at this, Bitcoin is even better, right? Because of all of the enhancements that it makes to holding money directly and to the growth that can be experienced with a fixed supply monetary asset that's undergoing rapid adoption across the world.

what better what better vehicle for growing wealth than bitcoin so i shifted my approach there totally toward bitcoin and then i'll repost you there trey because i think the the sort of bookmark that i want to put there and don't let me put words in your mouth but i think what's important to call out is even as i opened to that question this is not a story about or a conversation about a guy who got lucky, grew up with a silver spoon, sold a company, made $20 million, and therefore it was just a matter of how do I get 7% return and my children's children are good. I think this is about, I would argue, tell me if you disagree, redefining independence and as I chose the word sovereignty. So perhaps could you sort of give us a look back at your mindset pre-Bitcoin as to what financial independence meant and then after Bitcoin. I didn't have a concept of financial

independence before I found the FIRE framework and before I found Bitcoin. And I definitely didn't have a sense of like true sovereignty built into that framework until I really fully understood Bitcoin, until I started holding my own keys and running my own node and like doing all of these things that Bitcoiners, you know, talk about as being able to live that sovereignty and actually apply that sovereignty that Bitcoin makes available to everybody who wants to who wants to grab that opportunity. I came from a libertarian background, for sure. So I definitely had that strain of thought underpinning the way that I was coming into viewing Bitcoin. And, you know, perhaps that has, I don't know, I haven't really thought about it. Perhaps that has some influence on my susceptibility to understand the FIRE framework and what possibilities might belie adopting something

like that or just making it easier for me to see value in approaching things like that. And to put the work in it, right? To see that there was value in doing that work and to carry it out. Yeah, yeah, absolutely. But like I said, And, you know, I kind of started my career. I didn't really think about saving all that much. I just kind of assumed that it would happen to some degree. And, you know, I made, you know, decent money. My wife made decent money and that kind of thing. So it wasn't really anything that we really were worrying about too much on a day-to-day basis. But I started like the corporate – this is maybe taking down a different rabbit hole. But like the corporate environment for working and the cubicles and the management structures and the meetings and all this stuff, like for a lot of people, it's kind of soul-sucking. This is exactly what I want to talk about. And when you do it for long enough, like you start to become cynical and you start to become pessimistic and you start to dread every day.

Right. You've got to deal with this commute. You've got to manage all of these people that you don't necessarily like, but you've got to get along with that don't necessarily share the same values that don't necessarily have your best interests at heart. Now, don't get me wrong. Like I worked with a lot of really great people, but they're all being influenced and pulled and pushed by the incentive structure that that corporate entity has as well. And so it's like when push comes to shove, these entities don't really care about the individual all that much. They, I think, are well-intentioned. But again, like the structure of the economy itself, the way that these corporate apparatuses have to operate, it does put pressure on people that puts you as the individual who's working for them in a kind of vulnerable position, right? And what you can do when you take control of your personal finances.

So post-Bitcoin, that looks like what? Yes. What you can do when you take control of your personal finances and when you adopt Bitcoin is you can take that power back. You can fully own the wealth and the future that you are building. and as you get further and further into that process, you become less and less reliant on these institutions and companies that you are working for. And you can start to put yourself in a better negotiating position, right? Because at a certain point, you could just walk away. And that's ultimately like what this should be about from a personal finance or financial independence standpoint is how do you put yourself in a position where you don't have to be there anymore? or where you have at least done enough where if you needed to walk away, you could. And you would have like a cushion or a safety net. It may not mean you stop working, but you have got, yeah. And I think that's... And focus on the things that you actually find passionate.

Yes, as you and I discussed in Nashville, you know, a couple of weeks ago. Exactly. And as I say, I know it's a tall order, but I think that is in fact the gist, the spirit of what I want to convey here is it's not, you know, 100 million in the bank and you're flying around in private jets sitting on the beach. By all means, you can get there. But it is that subtle shift. And I think maybe another way to draw this out, if you don't mind talking about it, I know you're a very, very proud, devoted father of two young girls. Like, how do you think about raising kids in a world where this kind of autonomy is possible and now for you is real. Yeah, it's kind of a difficult environment that we find ourselves in as parents, I think. You know, as a Bitcoiner, you want people to, you want your family, you want your kids to

learn those values and incept them and make it part of their makeup and to carry that forward, whether it's the principles of just understanding how money works and how the financial system works so that they can use it to their advantage and actually benefit from it instead of be prey to it. Um, and, you know, but at the same time, there are all these different systems in place that will distract them in different directions. And I think you've covered that on a few different, you know, uh, episodes that you've done, which is just around, you know, the social media that's there, the influences around, um, their, their friends that they are associated with the schools that they go to the teachers that they're exposed to. And I think, you know, when you adopt Bitcoin, when you think about the sovereignty that Bitcoin provides for you, it starts to turn you a little bit more internal in the way that you approach the conversations with your children.

And even if you are, even if those kids are still in some of these different systems, you at least know enough. You've opened your eyes enough to be able to kind of counteract some of the negative things and focus on some of the positive things that they can get from these different relationships and the institutions that they are growing up in. Right. Like you can't insulate your kids from the world. No. The world's a very weird place right now. But you can choose. That's what's so powerful. And you can show by example that this whole other path, this whole other world, and this whole other way of approaching your career and your finances and the thought processes that you have around what is valuable, what you should spend your time on, what you should spend your money on, all of that stuff you can lead by example with. And I think that's actually the most important lessons that your kids get from parents is like, what are they seeing?

How do they see you interact with the world? How do they see you go through your own thought process? Not what you say. It's how you live. Exactly right. Exactly right. Well, and let's close here, Trey, for a few minutes. I mean, you are speaking with, what, hundreds, thousands of individuals and businesses every year. And so when you encounter someone, as I believe, you know, many watching or listening to this will be, who, as I mentioned at the opening, they know something's wrong. They know the monetary system is broken. But perhaps they're not yet ready to take those first two or three steps. So as a fellow, you know, sales professional, when you realize you're not going to get a yes, what are the two or three most important things you leave with someone in that conversation to put them on the path to understanding why they will want to say yes to living on a Bitcoin standard? How do you get them started?

I mean, I think everybody comes for number go up technology to begin with. And so, you know, we can talk about financial independence and we can talk about sovereignty and using Bitcoin and that kind of thing. But people, generally speaking, just want like next year to be better for them than the previous year was. And they already they already understand, as you were talking about when we when we first started this conversation, people already understand that the money is broken and that inflation eats away their savings, that you have to save in order to get ahead. And the FIRE community definitely understands this, but they understand it intuitively, right? And so I think like riding on the coattails of the momentum that people already have and their desire to improve their lives is really the best way to help people start down that path. and then talking to them over time about the things that you are doing to say,

hey, you started buying Bitcoin. It's been a year. You probably have like a decent sized balance here. The next step is X. It is starting to think about like taking a little bit more sovereignty, controlling the keys to that. Like, here, let me show you how to do that. And I'm happy to help. And so I think like appealing to the momentum that people already have and the incentive structure that they already have. Which is a way to help them move in the direction that we all want them to go, which is to take more sovereignty over their personal finances, to take more sovereignty over the way that they interact with the world, and to ultimately move the world toward a Bitcoin standard that we know, that we feel, and that we expect will create a much better world for our kids and for the human experience across the globe. Couldn't end it better than that. Trey, thank you so much for the time, for your insights. I will be sure to share, of course, FireBTC, your newsletter, your website, and get people pointed your way if they want to learn more.

Absolutely. I appreciate it, Sean. Really great conversation. Please, anytime you want to have me back, you know, I'm here for it. I'd love to. You got it. We'll do it again soon. Thanks, Trey. All right. Take care. Bye-bye. Thank you.