Max Keiser and Michael Saylor were greeted by a rollicking crowd at Bitcoin 2021 in Miami, Florida. Saylor trailed onto the stage Keiser, whose arms were outstretched with his palms facing inwards, as he pulled his fingers towards himself repeatedly. He then raised his elbows above his heads as the bass-driven music and crowd reached a crescendo.
“Yeah!” Max yelled, as he pulled his arm back and forth signaling jackpot. “Yeah! We’re not selling! We’re not selling. [expletive] Elon! [expletive] Elon!”
“Dude,” Keiser said as the crowd began to calm, but remained standing. “Alright!”
“We talked this morning to coordinate our outfit,” said Saylor, wearing an all black suit with at least the two top buttons unbuttoned and a shiny silver belt buckle visible to the eye. “And I wanted Max to wear black and Max wanted me to wear a white…so we agreed.”
“Have a seat,” said a purple-spectacled Keiser, wearing his patented white suit with a black and white-lined t-shirt underneath, no socks, and a pair of loafers. “Alrighty. Michael Saylor. GigaChad.”
Saylor cleared his throat. “Max Keiser, High Priest of Bitcoin. Father I have sinned…”
“What does it feel like to be a noobie?” Keiser zinged, the crowd laughed.
“You know,” Michael began pointing out he bought his first Bitcoin a year ago yesterday, while Max looked at the audience, licked his fingers and flipped to his second notecard.
“And so this is the end of my rookie year,” said Saylor.
“Right on,” said Keiser. “I wanted to get into that.”
Keiser explained how in 2014 Saylor’s friend, Eric Weiss, the CEO of the Bitcoin Investment Group, spoke to him about Bitcoin. Saylor more or less ignored it. In 2020, Weiss mentioned it to Saylor again. Within a few weeks, Saylor was buying tens of thousands of bitcoin himself and his company.
“What the [expletive] happened?” asked Keiser.
“Well, I guess I lost faith in all of my traditional investment strategies,” said Saylor with his index and middle finger of his right hand held over his temple. “I didn’t really think much about the dollar and about inflation. I thought there was no inflation. And I thought I could just sit and own big tech companies and the world would work itself out. And I guess around March, everything changed, and the monetary inflation rate tripled…”
It became clear to Saylor that the big tech trade was a crowded trade. “At the point that my niece, in her early 20s, was telling me about Apple stock, I figured that maybe it wasn’t cutting edge.”
Saylor looked around, and he discovered Bitcoin. “And when I discovered Bitcoin, I thought, ‘Well, this is digital gold on a big tech, monetary network, and it’s going to grow by a factor of 100.”
Saylor then thought he should buy as much as he could. “What I tell people even to this day is, I was buying it, and I was thinking, I have to buy as fast as I can, as much as I can, because someone else might figure this out before, and then I won’t be able to.”
Keiser stopped Saylor at this point. “Okay, that’s really interesting for shareholders,” he quipped. “But, my understanding is that you were visited by the ghost of Satoshi at night, and it came to you in a dream and converted you. That’s not the story?”
“Yeah,” Saylor said. “Satoshi speaking through all of her or his disciples on YouTube.”
“Your laser eyes are pointed right at my brain right now,” said Keiser. “Are you stealing my private keys?”
Right at this moment, Keiser reached into his right pocket, and pulled out a square of tinfoil, which he placed on his forehead.
“You should keep your private keys. I don’t want your private keys,” said Saylor.
“Okay,” said Keiser. “Well, we just met, so I guess that would be a bit forward. Let’s move on to some recent comments you’ve made.”
Keiser mentioned Saylor had talked about Bill Maher. “You said the following: ‘There’s something cruel and tasteless about a rich white male who wants to deprive billions of poor men, women and children in Africa, Asia, South America the basic human right of economic self preservation, so they can generate a few laughs,’” Keiser repeated Saylor’s words. Keiser noted the profundity of the comment, and asked Saylor to tie it into Bitcoin.
“After you study Bitcoin, the lightbulb goes off,” said Saylor. And what I realized is anybody on earth that wanted to own anything—they wanted to own some property—has a choice. You can buy land somewhere, but someone can tax it and take it away from you. You can buy gold that someone can take away from you. You can buy stocks, but you can never take possession of it. You can buy debt, you can never take possession of it. You can buy jewelry, people will take it away from you. And Bitcoin is the apex property of the human race. It’s the first time we figured out how to create true property that you can take possession of with full custodial rights, that’s least likely to be inpaired, that’s most mobile.” It doesn’t matter how much money you have.
“If you have a billion dollars, you can buy a building in Manhattan or Bitcoin, you’d rather have the Bitcoin. And it doesn’t matter if you have $387. If you have $387, you can still buy bitcoin and take it anywhere. And, if you compare that to buying silver or gold or land or stock, your custodial and property rights are impaired by everything else. And so I think Bitcoin is truly a seminal invention of the human race, because for the first time in human history, we can grant property rights to 8 billion people. And that’s what I think is cool.” The crowd cheered.
“Is Bitcoin designed to attract attacks?” asked Keiser. “It seems that it is and the level of attacks are rising to the state level, etc. And is it a bug or a feature?”
“I think that which does not kill Bitcoin makes it stronger,” said Saylor.
“Right,” Keiser immediately said, before swiftly moving onto energy. “So, total global energy production is about 160,000 terrawatt hours per year.” Keiser asked the audience how much of that goes into Bitcoin. The choices were 10%, 5%, 1%, or 1/10 of 1%.
“Of that, how many people think it’s 10%? Raise your hand.” Few raised their hands.
“5%?” Few raised their hands.
“1%?” Few raised their hands. “This poll sucks.” “One tenth of one percent?” The crowd cheered.
“Right,” said Keiser, who then asked what Saylor makes of the FUD which states Bitcoin wastes energy and is bad for the planet.
“Bitcoin is an extraordinarily disruptive beneficial technology to the entire energy industry,” said Saylor. “And as I studied it, it became clear to me that it’s the highest value use of intermittent energy, it’s the highest value use of renewable energy, it’s the highest value use of wasted or stranded energy, and it’s the highest value use of energy period, period. And it’s the solution to developing power plants in remote locations, it’s a solution to driving up efficiency of plants and driving down cost, and it’s a solution to solving any kind of challenging energy problem. And I think as the world understands that, they’re going to embrace it.”
Keiser then brought up how Bitcoin miners are leaving China for the US. “Let me ask you this,” began Keiser. “It seems that if we went on the global Bitcoin standard, total global energy use would be cut by an enormous amount, because you’re defunding central banks, you’re defunding fiat money, you’re potentially defunding huge military operations, just by going on a Bitcoin Standard. Isn’t that the greenest thing anyone could possibly do?” The crowd clapped and whistled.
“Yes, said Saylor. “Bitcoin is the most efficient use of energy that the human race has yet come up with. I looked at the annual report of Google. And Google puts about $170 or
$180 billion of energy into their business to create $1.8 trillion of assets. Bitcoin puts $4 billion of energy and capital investment to create an $800 billion asset. So, Bitcoin, you put in $1, you get out $200. Google, you put in $1, you get out $10. I studied the entire S&P index and all the annual reports you put in $1, you get out $4. If you look at a bank, JP Morgan, they spend $1 to generate $3.8 dollars of value. And if you study an airline, they put in $1 to get out 40 cents. So, Bitcoin is some 20 times more efficient than Google, and is 50 times more efficient than a normal company, and it’s 500 times more efficient than real energy producers.”
Saylor continued, stating that he believes Bitcoin miners are under-appreciated. “They’re the first line of defense against the entire network. They’re securing the network. And the way the Bitcoin mining works is, they’re finding the jurisdiction that has the most political support. So, Bitcoin miners are finding political capital. They’re finding energy capital, and they’re finding the cheapest energy. They’re finding engineering capital; they’re engineering these beautiful Bitcoin mining centers that are heat engineered, very complicated. They’re finding technical capital in terms of semiconductors and ASICs. They’re putting all that together, with the raw energy, in order to provide security to the network. And they’re migrating continually to the cheapest power, the most supportive political jurisdiction, and they’re instigating upgrades in the technology, and they’re doing that dynamically without being told to do it to the benefit of everyone in the entire ecosystem. I think that’s really a beautiful thing.”
Keiser points out how Christine Lagarde, head of the European Central Bank, refers to Bitcoin as an escape hatch, and how that is a negative attribute. Keiser wants to know what Saylor thinks about that. “When you say Bitcoin is savings technology, in a world where everyone’s dissipating their energy, the most rational thing is to conserve yours,” answered Saylor. “And so Bitcoin is conservation of energy. You can store your lifeforce and fiat and know you’re going to lose one to 2% a month. You might lose 4% a month in a collapsing currency. You can store all of your economic energy in credit, and that’s not much better.”
Saylor notes that with equity, you run the risk of a company diluting their own shares. “At least Bitcoin
has no CEO to print 10 million more Bitcoin overnight, whereas that might happen with an equity. So, when we talk about an escape hatch, if you’re looking for a safe haven, I see Bitcoin as the most secure, most reliable, most certain thing in the entire economic universe. And if you’re looking for some place where you can store your life force, your economic energy, there’s no real question. Bitcoin, you can store it and take it with you wherever you want, or you can put it in land and a state subject to a governor or mayor or country, or you can put it on the stock exchange, and you can worry about what the CEO or the board of directors will do the next day.”
Keiser asks why certain executives, academics, and economists are so averse to Bitcoin. “They develop Bitcoin Derangement Syndrome, and they seem genuinely threatened by it,” said Keiser. “What goes on in the mind?” Saylor gave his take.
“I think that if you’re comfortable in your environment, if you have plenty of wealth, and you’re in a comfortable situation, then it’s in your best interest just to assume that things will go on the way they are and you can’t imagine a change in the underlying physical circumstances of your environment. If the ship is sinking, and you know the ship is sinking, then you become enamored with the lifeboat. But, if you don’t know the ship is sinking, and you’ve got the luxury cabin on the ship, and someone comes and knocks on your door and says you got to run out and jump in the water right now, you think that it’s a nagging problem.”
To appreciate Bitcoin, you’ve got to put in the work, says Saylor, and you have to have the motivation. “Some people put in a lot of work, learned it, and understood it,” said Saylor. “And then, of course, they’re very passionate about it. Others, they have the motivation, but they haven’t put in the work. And then a lot of people don’t have the motivation. It’s not going to change their life, and so they can’t conceive of their worldview changing or sinking…Whenever I see anybody criticizing it, I say, ‘Well, what’s your solution to people in Argentina?’ Right? Like when you’re in New York and Manhattan, and you’re at a cocktail party, and then you’re criticizing this, like, what are you saying to everybody else in Africa or South America or Asia or Venezuela? What is your solution to them?’”
Saylor believes Bitcoin critics just don’t get Bitcoin. “I’ve never seen a critic say, ‘I hate Bitcoin. I think that people in the rest of the world should buy Apple stock to save their life savings in Africa to avoid having it stolen by the local government.’ Nobody says that. So if you don’t give a constructive solution to the problem, then you’re just reflexively rejecting a new thing.”
Keiser asks if Saylor is a corporate heretic. “And what I mean by that is in corporate CEO suites, they borrow money and they buy back their own stock, and their executive options go up a lot in value, and they cash out,” said Keiser. “You looked at this situation, and you said, ‘Oh, the ice cube on my balance sheet is melting, I’m going to buy bitcoin, I’m even going to borrow money to buy bitcoin.’ It seems almost like a speculative attack on the central bank itself. Is that a fair characterization?”
Saylor says the conventional Treasury strategy for a decade was always to buy short-dated treasuries. “And in order to get my stock up, I buy back my equity and leverage up my cash flows,” explained Saylor. “I watched 99 out of 100 of my competitors all go out of business pursuing that strategy. What they do is they do a dilutive acquisition where they buy another company, and they keep bolting on acquisitions until they got 37 companies, and it all falls apart.”
They then sell the company, go private or they keep buying their stock back and leveraging it up. One way to do that is decapitalizing the company, the other way is diluting the company. “What I was doing with Bitcoin was saying I don’t want to decapitalize the company, I want to keep the capital or grow the capital, but I want to put an asset on the balance sheet,” said Saylor. “And a big breakthrough is I can convert my cash from a liability to an asset. And then we realize that if that asset is going to go up by more than 10% a year, and you can borrow money at 5%, or 4%, 3%, 2%, then you should pretty much borrow as much money as you can and flip it into the asset. And why wouldn’t you?”
Keiser wonders if Bitcoin checks the ultra low interest rate policies by central banks that seem to be there to only benefit a select few at the top, while disenfranchising the many. “If all corporations did what you guys are doing, it would seem to disrupt the central banks, which in fact, would then help Bitcoin. Is there a virtuous cycle here? Should corporations take a more politicized stance and do this for that reason as a way to get rid of possibly the greatest threat we have and that is the central banks…Is there a political angle to this at all? Are you allowed to say that?”
By now, Saylor was bright red, and had a large smile on his face, while he rubbed his forehead with the palm of his hand. “I think we can all go forward constructively together,” said Saylor after not even a second had passed, causing Keiser and the crowd to laugh. “And, look, Ray Dalio says he’d rather own Bitcoin than a bond. There’s 100 trillion in bonds. That was a big statement that he made just a week ago. Corporate treasuries are holding bonds. As people rotate bonds and cash into bitcoin, price discovery will return to bonds and that means that you can buy an annuity for a fair price and that’s good for the world. It would be good to be able to buy a bond that had a good annuity stream.”
Saylor also believes that price discovery will return to stocks and investors will be able to buy a stock that pays a decent dividend that’s less risky. “And that will be good for the world. If we de-monetize residential real estate, you’ll be able to buy a house at half the price that’s twice as good, that’ll be good to the world. And so I think that the virtuous cycle is Bitcoin is de-monetizing gold, your jewelry will be twice as good, half as expensive, it is demonetizing real estate, your house will be twice as big, half as expensive, it is demonetizing debt, you will be able to buy an annuity that yields 8% interest with no risk. It is demonetizing equity and ETFs. You’ll be able to invest in a company and not pay 50 times revenue and take a risk, you’ll be able to invest reasonably. And so, Bitcoin fixes everything. And if you wish me to make a political statement, the political statement would be: it fixes government, because as it fixes everything else, governments act rationally.”
Certain governments are acting rationally at present, says Saylor. “In weak countries their currency collapses to zero,” said Saylor. “And they have to adopt a new currency. Right now they’re adopting the dollar. I see a world where eight billion people have a mobile device and they have a digital wallet and they have a digital currency, like $1 or a euro, and then they have a digital asset, Bitcoin. And Bitcoin links together 8 billion people, links together 100 million companies, it synchronizes the world across political jurisdiction and it returns rationality to the entire financial system, and it returns freedom and property rights to the human race.” The crowd cheered.
Saylor has alluded to Bitcoin as a new life form, Keiser noted. “And sometimes you refer to it as evolving.You say nothing can compete with Bitcoin as money unless it’s a unique beautiful creature that does something unique. It’s like a plankton or a lobster. You refer to one of the [expletive]-coins out there, Ethereum, as a shark-duck that lives in trees, right? So you use these life affirming metaphors quite often…The reason I bring this up is because the difficulty adjustment, the way it acts, seems like it’s alive in a lot of ways. So what are your thoughts on this?”
Saylor believes a crypto is a living creature. “We’ve released life in cyberspace,” he said. “And Bitcoin you could think of as plant life or a plankton. It’s a base level life. It’s not the most complicated creature. You could think of it like some of the other DeFis they want to be animals and run around, and Bitcoin wants to be greenery and cover the entire Earth. Once you’ve released the DNA of Bitcoin, you just have to let it fester everywhere in the world and let it be it. I think the beautiful thing about Bitcoin is, it’s done. There’s no reason why it can’t become one hundred trillion, two hundred trillion, three hundred trillion dollar creature. The fundamental difference, I think, with a crypto asset like Bitcoin versus what other people are trying to do in the space is the whole idea of a crypto asset is I put my monetary energy, my life force into it, and then I let it live for the next 1000 years. And it’s okay just to be alive for 1000 years…What’s wrong with being rich forever, right?”
And, in Saylor’s mind, that’s what Bitcoin is. “And then all of the innovation will take place at layer two, I think when Square builds Bitcoin, when PayPal builds Bitcoin into its layer two, as people build Lightning applications into their applications on layer two, I think they’re doing all the beautiful, intricate, functional, high performance things. And they take the risk, they have the upside, but we don’t impair the underlying base layer. The life force of the world is Bitcoin. We just gotta let it be and respect it for what it is and not mess with it.”
Saylor adds: “We say Bitcoin is hope, and Bitcoin fixes everything.”
He then delved into the dynamic at MicoStrategy post-Bitcoin. “Our stock was at $120 a share, when we actually decided to embark on this strategy. And it imbued life into the company, the employee morale was dramatically boosted. We just had our best first quarter we’ve had in a decade. I was ready to quietly retire. I had not posted on Facebook, not posted on Instagram, not posted on Twitter for four years just about, and then Bitcoin happened to me, and I got dragged into the limelight again. And here I am.”
Keiser asked Saylor to expand on the improved culture of the company since MicroStrategy gained so much attention after investing in Bitcoin. “The employees are really fired up,” said Saylor. Keiser asks if that is another selling point, beyond the risk of inflation and holding cash, for executives sitting on the fence when it comes to buying Bitcoin or not.
“Bitcoin is a technical imperative, it’s an economic imperative, and it’s a moral imperative,” said Saylor. “And if you want to revitalize your company, then you need to embrace it, right? And we see that example. If I have a billion dollars on the balance sheet, and it’s in cash, I’m losing $200 million a year. You’re draining money out of the balance sheet. And if it’s not on the P&L, you’re not bringing it in on that side. So, you’re sucking energy out of the company with the conventional Treasury strategy.”
When MicroStrategy began investing in Bitcoin, energy began to be injected into the company. “It’s like jacking your company into the electric power grid,” said Saylor. “If you look at successes like Square and PayPal, by them plugging into bitcoin, it injected energy into their P&Ls, and I mean they’re just wonderful success stories in the industry.”
Saylor believes that Bitcoin can help everyone in the world. “I go on CNBC, and I look on Twitter, and I find like my interviews run 750,000 times on Twitter. I said to my friend, Eric, ‘What’s the NBC audience?’ And he goes, ‘Oh, they only have about 190,000 people watching.’ And then I said, ‘How did this play against other stories?’ The CEO of Exxon Mobil went on CNBC to talk about the most important thing in the business. He had 4,000 views. The CEO of Apple Computer goes on CNBC: 12,000 views. Barry Diller goes on CNBC, and he talks about how he hates the Apple Store and how the entire mobile app ecosystem is wrecked: 12,000 views. And so I think the story here is, Bitcoin is hope for eight billion people. If your company is going to be meaningful to the world, do something to spread Bitcoin, and if your company is sitting on a balance sheet that’s investing their money into an asset, which is losing 20% of its value every year…stop the bleeding. Just stop the bleeding.”
Keiser mentioned Saylor’s pinned tweet. “#Bitcoin is a swarm of cyber hornets serving the goddess of wisdom, feeding on the fire of truth, exponentially growing ever smarter, faster, and stronger behind a wall of encrypted energy.” Keiser asks how important the Cyber Hornets are to the Renaissance 2.0 that is Bitcoin.
“I think that the reason that Bitcoin is going to win is because of the community ethos,” replied Saylor. And when I refer to Cyber Hornets—yeah, I refer to everybody on Twitter and everybody in the community that’s educating the world and defending Bitcoin. And they’re the loud in your face Cyber Hornets.” But, Saylor was also thinking about every Bitcoin miner running a Bitcoin mining rig everywhere on earth.
“They’re fighting for the network,” he continued. “And I was thinking about everybody running a node— I think a node is like an altar to Satoshi in your house. As long as everybody is running that node, they’re defending the network, and they’re defending the movement. And I was thinking about every company, and I was thinking about every single technology that integrates into bitcoin, I was thinking about every analyst and every politician, and every journalist that’s defending, speaking out for educating or supporting this network, and it’s happening in every country, in Korean and Japanese, and Spanish and Russian, everywhere on earth.”
There is one thing that Saylor just loves. “If you go on television, you’re the CEO, and someone says, What do you think about Bitcoin? I think, Okay, I’m going to talk about this and try to explain to the world why this is good for the earth, good for technology, and the future of humanity. And then when I get done, I go home, and I turn on the television, there’s another Bitcoin CEO. And then the next morning, there’s another Bitcoin CEO, and the next day, there’s an analyst. The next day, there’s a politician. And I just think that’s so great to be in a community. Every one of them is a Cyber Hornet. They’re all fighting for Bitcoin. And when someone falls, someone else will stand up and carry the banner and take it forward. And I don’t think you can say that about anything else on this earth.”
“Cometh the hour, cometh the man, Michael Saylor,” said Keiser, as Saylor thanked the crowd. “Let’s give it up for the Saylor Man.”