Despite Our Bitcoin Fanaticism, We Sold It All—Here's Why (& Our Current Financial Positions)

In this episode, we explore the evolution of Bitcoin and cryptocurrency, focusing on market timing, cryptographic challenges, and the potential impacts of quantum computing. We examine critical technical upgrades such as SegWit and the resistance within the Bitcoin mining community. The discussion also covers our decision to exit Bitcoin, investment strategies for high net worth individuals, and the shifting dynamics in venture capital driven by AI advancements. Further, we delve into the promising sector of AI-driven GPU data centers and their investment potential. Lastly, we touch on the unexpected shutdown of the UK Biobank and its broader implications.

Malcolm Collins: [00:00:00] Hello Simone! I'm excited to be here with you today! Somebody told me, one of our fans, they said, you guys need to do more episodes on like, How to make money and do business stuff . And at first I was like, well, I think we sort of covered those in our episodes.

Like how do you get rich? And things like that, because we've already done episodes on that. But I was like, no, actually I have some updates because in that episode, I told people very strongly. I said by Bitcoin this was on, this is not

Simone Collins: investment advice. We are not advisors and this is all hypothetical.

And we're talking about our personal experiences.

Malcolm Collins: I strongly felt it was a good time to buy Bitcoin. And the episode largely went into like, why in terms of valuing and investment, why Bitcoin was good on November 13th, 2023. And this is when the price was at 36. 5 K. Today the price is at 65. 4 K

Microphone (2- ATR2100x-USB Microphone)-1: No, the price has gone up to 67.2 right now this morning. So if you sold now, you would make even more money

Microphone (2- ATR2100x-USB Microphone)-2: off of this idea that we did. And for those who are like, oh, well [00:01:00] you, you know, you didn't. Get out at the top here. I am okay. Was doubling my money.

Speaker 5: I was paid too much! Billion dollars worth of Bitcoin two billion dollars well at the time a few days later the value spiked to like ten billion Then filled a fifty million and spiked again to a trillion and then dropped a bunch of times and right now It's all worth like seven or eight bucks.

Ah, geez. Yeah, I'm super pissed

Malcolm Collins: And we will be airing this a little after we record this, but we ended up closing all of our Bitcoin positions. And one of the reasons why we're doing this episode is just as like a, if I have an episode out there telling people go buy Bitcoin, And I have sold all my Bitcoin, which you didn't

Simone Collins: do because it's all not investment advice.

And this is all hypothetical.

Speaker 6: BiTcoin and you. Why you should be using the only truly free currency.

Greetings, financial wizards, industry leaders, and curious spectators, and welcome to the future. Yes, we're living in a high tech cyber world where just about everything is digital. The cinema has gone digital, radio is digital, why even love is digital? So then why, with the whole world going digital, are we still using dirty, crazy, non digital [00:02:00] government money?

That dollar bill in your pocket? A Nazi probably touched that So there's another way to spend and save money without the involvement of the government or the Nazis.

Bitcoin is that way. , Bitcoin is a purely digital currency that uses complicated cryptographic science to generate lots of super hard math problems. These math problems are converted by computers around the world into seemingly random strings of numbers that some people have agreed to pretend stands for a highly volatile potential sum of money.

Solving these math problems is called mining

you see, Bitcoins aren't backed by any real world items, such as gold or by a governing body like the Federal Reserve. So the value of a Bitcoin is entirely bubble based. But what a bubble it can be! Without the nuisance of regulation or real world value, a single Bitcoin could be worth anything from negative infinity to infinity billions of dollars.

I imagine if it reaches even half of that. So, whether you're a libertarian or just want to spend your money like one, consider converting your wallet to a Bitcoin wallet. Who knows how much it'll be worth tomorrow? It could be anything.

Simone Collins: And we're only talking about one

Malcolm Collins: person says I bought X, you know, other people are going to be like, eh, it should probably, [00:03:00] you know, be interesting if

Simone Collins: people were influenced by that episode, one, they would have profited as long as they held about

Malcolm Collins: doubled their money. So good for you if you did, but also remember to sell.

But I want to say,

Simone Collins: yeah, we, we don't want to be dicks to people who we may have inspired through our own actions. to get Bitcoin by not also sharing our concerns about Bitcoin now.

Malcolm Collins: Yes. And I will say, I mean, I'll, I'll briefly give my bigger concern about Bitcoin then I'll go into the specifics of it, the ways that Bitcoin can get around this particular problem and why I don't think they will be successful, but where they have been successful at doing something like this in the past yeah, there's a time in the past where Bitcoin got around the miners.

Where the miners didn't want to do something and Bitcoin forced them to the rest of the Bitcoin community to force them to. So we'll go around how that ended up playing out in the past and why it's very unlikely to happen this time.

And after we talk about Bitcoin, what we're going to do is we are going to go into what we are thinking about doing with capital right now. [00:04:00] Because it's a pretty tricky time in the markets right now to know where to deploy. So the general gist of why we're getting out.

So you don't have to watch the full episode is everyone has always known that quantum computing is a risk to Bitcoin and it's a unique risk to Bitcoin because the Bitcoin governance system is kind of captured by the miners who have equipment that is specific to Bitcoin. to working on the type of simple algorithm that bitcoin uses, which is not very quantum resistant.

And so they have a huge interest to not have a change and we'll get to where the fight is going to be over that in the future. And people can be like, well, it might update or anything like that. But here's the thing. I have talked to a lot of Famous Bitcoin investors recently who invest publicly in this stuff and their firms and ones who are like really, really big on Bitcoin.

These are people who have, you know, multi billion dollar positions in Bitcoin. And I was asking them about what they thought of the quantum risk threat and they were like, yeah, it'll probably be a threat in a couple cycles, but [00:05:00] it's not going to be a threat right now.

And I've, and this is the conversation. This isn't like if you, if you're hearing this and you're like, oh, he's describing a conversation he had with me. No, I've had this conversation with like five people. five people at this point. This is something that like everyone who is very educated and still holds a position in crypto seems to think right now.

And that really worries me because this is very different from the Bitcoin narrative before, which is to say, Bitcoin is a persistent new financial disruptor. And a new type of asset that will be on the market permanently. This is now people saying, Oh, well, eventually it's going to go off the market.

But in the meantime, I th